Commission - Regular Meeting

quick meeting but all the effort and thank you guys for keeping us chugging along here. So with that we'll start our study session and um start with the request for commissioners to look at having a city commission representative on the parks and rec commission um mayor prom h sorry uh that was your name's on this but I know that the whole ad hoc had that discussion and you brought it up previously during a meeting so why don't you go ahead and lead with that. Yeah, thank you, Mayor Shamro. So, at the ad hoc interview committee for the parks and recreation committee, this uh topic came up of whether or not we would be interested in adding a commissioner, a city commissioner as a standing representative on the parks and recck commission. And um that we had some very brief conversations around that at the ad hoc and wanted to bring it forward to this committee and really looking at whether or not that might offer the benefit to strengthen the connection between the advisory committee that's doing some of the planning work and advising the city commission and the elected body that's responsible for policy and the budgetary decisions. So a lot of this was in uh the communication that was distributed in your packet. But in terms of the scale and visibility of parks and wreck, it represents one of the city's largest expenditures outside of police and fire. It's also one of the most visible services that residents experience day-to-day. And because of that scale and impact, we had a brief conversation about whether or not um improved coordination between the advisory committee and the city commission would be important. And that also helps us align with some of our other city boards and commissions with similar focus. Hickory Hills Advisory Committee, the Brown Bridge Advisory Committee, the Joint Rec Authority, all have city commission representation on them. So it would also in addition to improved coordination and communication, it would create more consistent

governance structure among these other committees and some improved continuity. Um, I think it also could help with strategic alignment of the parks and wreck new master plan as well as the city's strategic action plan. And having a commissioner at that table would help to assist with shared priorities, fewer disconnects, and a smoother implementation of some of the decisions that are coming from that group. So, um, I emailed Lauren early on. She indicated that there were no legal barriers to this change, but we would have to have a change in ordinance. So tonight's just really about policy direction. It's not a final um final action. So just wanted to kind of open it up to the group and and see what the opinions are.

So I wanted to also say it seemed like this had at least initially a lot of support to at least have the discussion. Is there anybody let's start out that has a strong feeling that we shouldn't do this because if not then we'll continue we'll proceed to um the kind of questions here were do we wait for attrition and replace a seat or do we want to expand it out by another citizen and a city commissioner and make it a nineperson board so I you know we could start there um I also wanted to ask really quickly what's the terms for um parks in Iraq is it a length four three or four threeear terms would we want the city commission wants to be a threeear as well or would we be looking at a fouryear? Um I would recommend a two-year term to track what the term of city commission

because we have that go different ways too of two and four and planning gets weird too I think. So okay so three seats expired this September. So this is kind of like the optimal time if we were going to have a city commissioner on this board. I I prefer to do it through attrition. I don't want to see some I prefer seven rather than nine. I'd like to see it done through attrition and it'll just give the opportunity. It looks like those three commission those three uh appointees on that parks and wreck right now are the junior serving

like they have the least amount of time. So I don't know if someone might think this isn't best for me but I think that's the opportunity that they could reapply and if all three apply we would pick two. But that's just kind of my thought on it. Okay. Go ahead, Lance. And then how long are the the meetings generally? Uh because I I tend to agree with Ken on this. Um you add nine people, that's you know, 20 more minutes of talking. Uh at least uh potentially at least if they were a city commission meeting. Um so yeah, just curious. I don't want to make these meetings too long that people don't want to be on them. Uh if we were to go up to nine members versus just do this through attrition and add a single commissioner. Mhm.

Mitchell, you served on the parks commission. It tends to be about an hour and a half or so. Heather, you had your hand up. Um I agree. I mean, I'd rather do attrition as well. The problem is is that um all these seats go up in September and I think the master plan summer so we'll miss strategic meshing that that should be going on. So, is there a workaround here we can have?

It was kind of interesting. We had two applica applicants for the position and we just appointed them and they were just added to it. So, if we did remove someone, we would probably get rid of someone that we just appointed to it. So, I wouldn't want to see it. I wouldn't want to see it done like that. Yeah. Um, so I think that that's something where we could get a little creative. Could we kind of pre-select the commissioner we want to know and have them audit after a fashion or um is there room to create exficio? Yeah, I mean you could initially and then make it a permanent person. All of the above are options really or you could simply have a commissioner that you designate that attends the meetings and isn't

you know that's sort of what you're saying with exeicio really if they weren't voting but uh you know there's any of those options would work. Well, the difference between kind of auditing versus exeicio could be that the exeicio would actually have a right to speak during discussions but wouldn't have a vote, right? Um, so if we could add I'm gonna have Lauren double check on that before it comes back to us, but would that be agreeable that everybody have that and then come September we would kind of do that shift and however that policy needs to be written. Um, or is that is that the will of everyone? And I think it would be important to have somebody vote, but if you guys think that just having an exeicio on it would help, but that but then you wouldn't have a vote. So

I think the exeicio would work over the summer months. I think it's versus just having someone just audit the meetings because then you're sitting and you're making public comment at the end of discussion, which isn't that helpful. So I think having an exeicio member that's actually participating with the group and in the discussion and in the deliberation would be helpful. and then moving for that September date to actually add the the commissioner city commissioner as a standing member of the group. Okay. I I agree. Okay. Also, for sake of continuity, we have recently appointed somebody

uh but we do have three seats uh that will come terms due and if those three people decide that they don't want to apply, which I think is unlikely, we could have very significant turnover. So having a few seats that have been there through the process can really help

get some sea legs there. Okay. Okay. So, what I'm hearing from everybody is we want exeic policy would bring us forward and allow us to have exeicio added as soon as would be allowable by process to tide us over till September at which point we would make one of those open seats a city commission designated and keep two public seats on that and we'll have that brought back to us. Was there anything else that people wanted to add or any gaps we see in what we've discussed? Great. Well, thank you to that whole ad hoc for bringing this idea back to us and I think that this will be a good positive movement for us. So, we'll look forward to that coming to us in the next couple weeks. With that, we will then move on to the uh fiscal year comprehensive audit. Heidi?

Uh yes. So, we have um Doug Breto with our auditors Hefner here and he's here to present our June 30th, 2025 audit uh results and to very briefly do so. Thank you very much. He's usually pretty good. Yeah, I'm good at brief. I can do that. Thank you very much. Um glad to be here tonight and just go over it. It is June 30, 25 year end. Um the audit this year for 25 went much better than the 24 audit. It was not only was it Heidi's first full year, but we didn't have that data breach thing to deal with

for 25. Sorry to bring up bad memories, but uh staff in 24 basically had to redo all a lot of different schedules and balancing reports. So, it went much smoother this year from both I hope their standpoint and ours. So, appreciate everybody's work and helping us uh gather up all the information for the audit. Um so this year we did a financial statement audit in accordance with generally accepted auditing standards as well as generally accepted government auditing standards and also completed a single audit of the federal expenditures the expenditures of federal awards. So um we had no findings. Um I don't know if you have the statement in front of you. If you do I'll throw out a few page numbers but um basically on page one is the opinion on the financial statement. Um there's not a slide for this, but the opinion was a good unmodified opinion. It says in our opinion, the statements referred to above present fairly in all material respects the financial position of the city. So that's a good clean audit report and certainly what you hope for. And then also in connection with the single audit, uh there was 1.4 million roughly in federal grants that that we have to look at and uh determine which ones we have to um drill down into to to do a full audit. Um but there were no significant deficiencies, material weaknesses or findings reported. Uh those reports are back on page 133 and 135 of the report. So so all in all a good clean audit and everything went very well. Um and then just by I have just a few slides put together with a few highlights. Um I do want to emphasize I want to make sure I address what you want to know about. So if there's other questions I'm certainly happy to take those. But um the first few slides here are the overall governmental activities which are all of the activities of the city other than

water and sewer all boiled down into a full acral uh basis. So you can see here the expenses by function and they the functions of general government, public safety and so forth compared to the direct or program revenues. And what this slide really emphasizes is the non where where do the non-program revenues go and they are used to to make up that difference between the expenses and the program or direct revenues. So you can see general government uses some of the property tax. Public safety uses that. Public works is a little bit odd because the program revenues include your act 51 street revenue for example and that money is actually capitalized at this level not expensed. So the expenses are are lower, but the the revenue stays there. And then the same with culture and recreation. There was some capital uh grants that were received, but so they're not expensed, but the the revenue is there. So, and then this is a a pie chart on that same basis of where the revenue is all coming from. And you can see the the bigger piece there, the 44%. I don't know how we ended up with two of the same colors here, but but the 44% is your property taxes. So, so and that's the next slide I'll show you the consistency from year to year and 28% this year in capital grants. And that's a bit higher the last couple of years than what it has been. And here you can see this is a comparison of what that pie chart information has, but a comparison for the last five years. You can see property taxes, the bigger number way on the the right there, um, consistently has increased over the years. Capital grants the last couple of years has been much higher. So, you've been going after and getting some grants. And even though the the bars are very small, but the interest and other

bars there, um, you can see the last two years the interest income has jumped pretty significantly. um on this, you know, $20 million chart, it doesn't look like much, but that's up up a lot for for the last couple of years, which is very good. And that's just interest rates plus the the type of investments that the money is in. So, then just to cover a couple things on the general fund, uh page 106 is probably the best place to to see where this information is coming from. Um this is just strictly your general fund now. Um expenditures by function and you can see over the last several years things are pretty consistent um among all the different they they steadily increase. Um nothing unusual that I wanted to point out on this slide. Now your general fund as reported in the financial statements is a little bit different than the general fund that you use for budgeting. Um, in the financial statement, we're required by Gazsby 54 to combine several of your other smaller funds into the general fund. So, this chart shows you the um the general fund fund balance both on the internal basis, which is the lighter blue line, and then on the Gazsby 54 basis. And you can see that they're pretty consistent in both ways. Um, for the year ended, the budgeted loss on the overall Gazsby 54 basis was 4.1 million and the actual loss was just just under 600,000. So, you finished well ahead of budget.

And on the internal general fund, it was a budgeted loss of 3.5 million and your actual loss of 300,000. So, you finished ahead of your budget on both basises or both the budget basis, I guess we'll call it, and and the Gazsby 54 reporting basis through all those notes really quick. Okay. Then just the the wastewater fund, the sewer fund. Um we just look at here the revenues and expenses compared compared to different years and make sure that there's a positive net change in position here and there has been for the last five years in both the wastewater and in the water fund which is the next slide. So we just uh try to monitor that to make sure that um if there is negatives we want to point that out to you for rate setting purposes. But it looks like things here are going relatively smoothly.

And I just want to point out that uh as I think is widely known and we're going to talk about fund balance for general fund in the next agenda item. But here for wastewater and water there has been um a period of time where revenues are exceeding expenses and that's uh strategic because we have a lot of very high dollar capital needs that are required to maintain that critical infrastructure. So, I just wanted to point that out. Yes, it is okay to have a positive bottom line, especially in these two funds.

It Benjamin, is it is it safe to say that that those excesses and those funds are going to go towards the membrane train replacements that we didn't talk about last meeting? Yes. Yeah. For wastewater. Yes. and other and then wastewater also has some other very significant uh capital needs as well as the the water infrastructure too. Tens of millions of dollars.

Yeah. And and one other thing to point out, there's not nothing on the slide, but on page 25 is your cash flow statement for the for the enterprise funds. And the cash and cash equivalence at the end of the year for the wastewater fund is 5.8 million. Uh in the water fund, it's $5,000. So that's There's not a lot of cash there. There might be some tied up in investments. Yeah, there's 2.8 million tied up in investments in that water fund. So, but all in all, the cash balances are not outrageous by any means with some of the capital that has to be taken care of. So, that was all I had to present. That's the end of the slides. Is there any other areas of concern that I can address or things you might have noticed that raised questions?

Uh I guess maybe one question it was uh so when we're looking at this one, do you have the rest of the slides from the packet? Who's who's the scroll master of? Who's the scroll master? He doesn't. It was page 34 of the 161 page packet. Oh, that that's not going to be up there. That's not up there. Well, there was an $8 gain on the sale of a capital asset and it was it was a $8 it was it had its own line and I just it perplexed me. Well, fair. It was that's in governmental activities um on change of net position. It was of the 161 page packet. It was on page 34. Yep.

And then when you went into the audit, it was actually page 16. Yeah. Here you go. wanted to look at it and see it, but I think governmental activities. I couldn't tell you what number or what that relates to. For $8, I likely did not look at box of crayons. I I just uh Well, the printer turned out to be more valuable. It was it was about the only single digit. Yeah. On the entire on the entire packet. So, well, it's it looks like it's the net of gain and losses. So, we we sold some things and then we gained. So, that's that's the net. It wasn't just one thing. It wasn't just one thing where we made $8. Great question. Fascinating.

Other questions? I have just a little one. Would the um ground bridge trust dispersement be why capital grants are up this year? That didn't get voted on until the fall, right? This was through the end of July of June. Oh, it was. Okay. Yeah. Yeah. That wouldn't have been recorded before June 30th. We've been just very fortunate. Sounds like getting a lot of good grants. Yeah.

Uh I I mean I guess we're going to talk about the unassigned general fund balance a little bit later. And there's the 11.42 and then they also talk about 8.79 million. One's 41 42% and one's 34%. And we try and target a 15 to 20. That's our Is that our policy? That's the city commission policy. That's our policy that and we're required to maintain no less than 15% by Gazsby. Is that correct? No. There Gazsby has a a rule of thumb so to speak, but there is not a requirement. Okay. What's the rule of thumb? The for a city this size 10 to 15%. Okay.

If if it for a lot of smaller cities, I usually tell them 25% because 25% is a threemonth operating slush fund, if you will. in case something happens, they can keep going for three whole months. But, uh, Traverse City has a lot more going on or bigger cities in general. So, so one of I don't want to jump to anything, but we're going to talk later about possibly waving the policy of maintaining the 15 to 20%. Correct? Yes. As an increase or underneath or over, we're going to go over. Yeah. And we'll talk about that extensively. want to continue to go over for the capital stuff that we're going to talk about, right?

Okay. Okay. I was just kind of like setting a thought in my mind. Okay. Exciting stuff. Stay tuned. Not really. Just other questions right now about the audit. All right. I think that was great. Thank you so much. Thank you very much. Appreciate it. Yeah. Okay. Back here. Okay. Okay. So, with that, we will now move on to the general operating fund balance, and I'll have you kick that off, Ben.

Yes, thank you. My uh document is loading here, but I uh just want to go through a few points, then I'll turn it over to the city treasurer and finance director, Heidi Shepy. But, as was just mentioned, the city commission has a uh general fund fund balance policy that says that you shall have no less than 15% or no more than 20% of your general fund uh operating expenses. And uh I'm coming to you now because we're in the thick of preparing the city manager's proposed budget that would be will be presented to the city commission in May. And before we get too far into that, I wanted to get some direction from the commission on uh adherence to this fund balance policy. And that policy is completely at the city commission's discretion. Uh and so um you have a memo in the packet from Miss Shepy uh that indicates that in order to align with the city commission's maximum fund balance um there would be approximately 3.54 million uh above uh the of the unassigned fund balance that would then be available for uh redirection if you will for by the city commission. So 3.54 million. Uh and I want to highlight a few items. Uh as is widely known, we are for the first time building a multi-year uh uh budget. Uh projections to provide elevated context and strategic intentionality in developing the budget that will reveal certain trends that won't be more fully into view until September of this year uh when Treasury accounting cycles are much more complete. Uh we have a variety of near-term financial pressures uh including over the last few years uh as is the case with multiple employee markets, we've had to significantly increase wages uh in order to attract and retain employees in an increasingly competitive job market. We have less and less applicants uh for positions and

we're continuing to evaluate our wages uh because we have critical services that have to be provided by those employees. uh and uh and and also uh that of course uh means there's a require increase in uh pension contribution as a result of those uh increased wages and we have budgeted for this coming fiscal year 1.1 million in fund balance uh toward our unfunded underfunded pension liability. Also related to pension our plan is presently funded at 55.2% 2% will be required by the state soon to increase uh those minimum contributions. We also have some capital and infrastructure and revenue uncertainty. Uh we just had over $7 million and anticipated general fund appropriation for this coming fiscal year to fund critical capital improvement needs. We're also taking uh for the first time really a strategic view, a holistic view of our facilities assets. For years, the city has had facilities that uh have not been uh budgeted to be maintained like they should be, and we're doing that now. As you know, we have a facilities manager on board as well. Uh that's going to require a tremendous investment that we haven't had before. There's also the governmental center building uh as well as the law enforcement center building uh future of them uh which is unknown but this building is having more and more issues as uh we also have some issues uh at the law enforcement center and those are going to be very big ticket items. I also want to share that when the voters approved in 2023 the millillage to fund primary transport services to be provided by our fire department, it uh aims to cover the uh cost of personnel and the acquisition of ambulances but did not account for the building of the new facility that will be necessary. That is a very important item and I anticipate we will likely

need to go back to the voters for a millillage for that uh important need to provide the service that the voters approve. Also, which we'll talk about in the next agenda item, there's the big looming question about the future of TIFF 97. Uh and we don't know what that looks like in terms of uh whether it'll just simply expire, if it'll be reset, renewed, or something uh in between. We also have a lot of policy initiatives and strategic planning initiatives. So we have core services we provide and we're now looking at strategic investments. And so I'm coming to you uh with the recommendation that you allow us to build this coming year's budget not uh com basically suspending that fund balance policy. So that in September uh we would ask the city commission to establish an ad hoc committee uh consisting of three commissioners and it would also include the city treasurer and myself to develop a plan for how to allocate that uh outstanding fund balance and I think that uh that is in my view the uh most prudent thing to do but I didn't want to make that assumption and come to you with a budget in May that uh didn't take into account this fund balance policy. We have the time now to pivot if that's what the city commission wants. And I know I've said a little bit more than maybe I intended, but Miss Shep, please add anything that you think needs to be highlighted, too. And I know you've got your presentation as well.

Uh yeah, I can just start the presentation if that's so the fund balance um policy. Uh as Ben said, um we're trying to determine um when creating the budget where we want to go. This presentation is just a snapshot of the general fund um as reported by our auditors as of June 30th. And so just for the new commissioners just to kind of review what is fund balance. Um so fund balance represents the uh the city's financial reserves kind of uh essentially our savings account. So that that's very helpful um when when dealing with cash flow. um when we start the uh the fiscal year in July, uh we want to make sure we have enough to cover um all of our expenditures as as the taxable revenue comes in. Uh this the reserves exist not only to protect the city during emergencies and unexpected events, but it also helps um manage the economic uncertainty and the revenue volatility. Um, as the auditor said, we re uh interest has been really good the last couple years, but it's totally relying on the economics and and the market and those kind of things. So, um, we don't like to take anything for granted and want to plan um, accordingly. Uh, fund balance policy. Um, as Ben has stated, I'll try not to repeat uh some of the stuff, but um, as shown in the slide by the auditors, we have the general operating fund and then we also have the Gazsby 54 general fund totals. Um, the policy adheres solely to the general fund. So on the slide that the auditors had, it was the lower of the two the two bars that were referring to. And um the policy it's it's a good policy and it it does uh is in line with Gazsby the government accounting standards boards in terms of the recommendation of 15 uh to 20%. Um overall uh in in the packet we had like

the calculations but I'll just kind of go through the Gazby 54 as shown in the auditor's report was 14 uh.4 u mill million dollars. that includes the general operating fund and the gazsby 54 of that the unassigned portion um is 11.42 million and that gets us to 41.9. 41.9 obviously is significantly higher than the 20% goal. Um but that is uh reflects a strong overall financial capacity of the city as a whole. But this also is all of the funds not just the general fund which the policy we have to adhere to. So the general fund as a snapshot the total fund balance is 10.27. Um with that we have to back out um the non-spendable items uh inventory prepaid expenses um already assigned fund balances from the 2526 budget. And then so after that um we have plans set aides then it gets us down to the 8.79 million. This is the figure that we use to determine compliance with the fund balance policy. So there's a lot of numbers and a lot of compile but 8.79 is kind of where we're landing in terms of the general fund um operating wrong this way. There we go. Okay. So policy comparison. Um so fiscal year the uh the general operating fund budget was 26.28 million. Um of that the unassigned 80.79 equals roughly 33% of the total expenditures. So 33.5 expenditures um place places us above. But I just want to call out in comparison. So, um,

in the audit, we had a fund balance of 88,793,000, which is the 33.57. Last year, we had a fund balance of 8,893,000. So, realistically, our fund balance only went down $100,000, but we went from 40% down to 33 because our expenditures jumped. So it's really not a matter of what we have. If the expenditures are going to pace higher than that reduction, that percentage is very volatile and can go pretty slow pretty quick or pretty low pretty quickly.

So just wanted to put that out there. So what this means is um obviously we are compliant we are in compliant with our policy because we are above what our goal is. But we uh want to um one of the things we want to request is to suspend the policy. So the current unside fund balance exceeds the 3.5. Um but we want to consider future priorities as Ben said that are uh this excess reflects uncertainty and we've been planning for future obligations. So it was intentional to grow the fund balance for these uh plans in the future. certain things that we have near-term financial pressures. Um, as as Ben said, the near the recent wage increases um they have higher fixed costs and those fixed costs are going to carry forward permanently and in perpetuity and they're going to increase by colas every year. So all of that um we want to consider when making this decision. Um pension contributions also follow along with the wages. Health insurance costs um HR uh has brought in some numbers. those are increasing um as well. Um the fiscal budget this year we we budgeted 1.1 million and um budget balance. So to balance the budget so when we created the 2526 budget we didn't have enough revenues to cover so we had to intentionally budget 1.1. Now whether we'll actually use that um department heads do a really good job of staying within their budget and being reasonable. Um, but realistically looking at the preliminary numbers, we're probably going to need to budget fund balance again this year to balance the budget. So even though we have that 3.5 million, if we use a portion of it to balance the budget for the 25 26 27 budget, it's really not that full

amount.

So, um, pension funding status, that's another thing you'll be seeing from me. Um when I first started the state came to us and basically said we are underfunded and have put us on a corrective action plan. Um we have been intentionally um increasing our ARC payment uh annual required contribution to uh MS and uh that has helped but and again our our pension liability is based on our wages. So um the w uh 55.2% 2% is based on the June 30th, 2025, but it's the actually June 30, 2024 actuarials. So, we're always a year behind in calculating that, which doesn't take into effect some of the significant um negotiated increases that we've had with personnel. So, um most likely you'll be seeing um that corrective action plan coming to you in the next month or so um from the state and I'll be asking for an additional contribution uh to to go into that to comply with the state's requirement capital and facility needs. Um, as Ben had stated, capital improvement plan was just uh given to the planning commission, but you'll see there's over 7 million in general fund requests from the CIP alone just for general fund contributions. That doesn't include the one mill that we have dedicated to street funding. Um, and uh we do know this this building and the law enforcement center are something we want to start planning and saving for. Um, most likely if we had a big expense like that, bonding is where we're going to go. But the cost of interest on those kind of things, anything we can have as a as a down payment, as you know, with a down payment on your home, you're going to save yourself in the long run. So, if

we did have um any extra in the fund balance, that could be somewhere we can direct it as well. And also um you guys just voted plant manor man real point was engaged for facilities analysis and so we'll be getting that report in 8 to 12 months and I think what we're going to see is there's going to need some uh contributions for some of our current buildings that we have. So those are the kind of things that the fund balance is not meant to be for ongoing expenditures. It's for one-time things like these kind of things. And when you draw it on the fund balance, you don't want to use it for wages or anything anything that's going to be going forward in perpetuity. It would be these one-time uh expenditures. Right. So, facility assessment estimates. Uh so, Tower Pinkster um had done an assessment June January 30th, 2024. They had identified 11.16 million in facility grade upgrades needed. That's just for fac for city facilities. Governmental center alone is 8.81 million. DPS building 1.6. And then MS4 the CIP has an additional 750,000 for brine management. So those are just a few things on the horizon, things we're looking to plan for. And fund balance is is kind of what you want to keep an eye on. The intentional use of fund balance is our goal here.

Uh as as stated, revenue risk. Um the CIP uh we have $26 million in DDA TIFF 97 revenue budgeted in the CIP over the next six years. Now um that is totally dependent on whether the the tiff 97 is renewed. Now that doesn't mean that this general fund will have to rec cover that full 26 million but that means the hard decisions are going to be need to be made whether those projects are going to be done or not. So, so, um, if the if TIFF 97 does not renew, then it'll be up to this, uh, commission to decide of those projects what what you want to use general fund money for. And then if you're using general money from fund for that, then what don't you want to do that's also on our plan. So those are um just things we want to always plan for, think about and make sure it's it's a conscious conscious decision when we make this uh going forward. Um policy and community priorities. So you also you guys have just um the uh objectives and key results which I thank you because it'll help with my submission for the budget for we're hopefully going for a budget award for GFOA this year. Um Fingers crossed

and this is this is what we needed. Uh also affordable housing focus um increased pilots. Um well and we all know that housing is an issue in the city but every pilot that we approve has an effect on the revenue and the bottom line in in terms of that taxable revenue. Um when when Doug was here he showed taxable revenue was our significant revenue source. So, as as we approve these pilots, the pool of revenue does go down. Um, current pilot impact is uh roughly $600,000 annually. Um, historically roughly 6 million. Now, this is um we don't have the records going back. So, kind of what I did is I took this year's um taxable revenue concession and times it by the number of years that the pilot has been in effect. So, this is take it with a grain of salt. Just a rough number there, that six million cumulative. Yeah.

And that doesn't account for the increase in property value that is caused by some of these developments over the vacant land that existed beforehand. Right. Correct. This is just the the current taxable value compared to the pilot rents and the difference between the two and then times the number of years. Just back in the math just to give you a rough rough estimate. Essentially money we would have had if there was the pilot wasn't Yeah. Yeah. Yeah. And the property was still in existence as it currently is. Correct.

So planning for the future. Uh as you've heard um this year is going to be a multi-year budget forecasting. So we're going to have the fiscal year 2627 um that you'll be voting and approving on. But then it'll also be 2728 and 2829 estimates. So you'll kind of we'll be able to gauge how that fund balance is going to draw down or what's going to happen with those personnel numbers. So um a goal is to improve our long-term planning, anticipate these financial risks early so we can get ahead of them and just make informed decisions. So based on everything that both Ben and I have said, uh our recommendation um due to the the near-term operating pressures, long-term pension obligations, we re recommend that we suspend the fund balance policy just for the fiscal 2627 uh budget year to allow time for uh comprehensive planning and evaluation of all of the information uh going forward.

So really quick question about that. You've said that you want to have the ad hoc formed in September when we have a clearer vision. Is this something that the suspension of the policy though would that be brought to us like in the next business meeting or two? Yes. Okay. Just wanted to clarify the timeline on that. And then uh and then based on the work of that ad hoc committee, you could do mid-year budget amendments, right? City commission always has that flexibility. So it's not like you're you're not able to really as a budgetary standpoint consider a change until June or July of next year. you could do a mid-year budget amendment. Uh so I just wanted to make that clear too.

So I believe this is the final slide just the kind of key takeaways. Um our fund balance I mean it's significantly above our policy. It's it's strong but it is under pressure. Um and it it's a little misleading in terms of excess capacity. Um we have sign significant risks ahead pensions facilities capital fundings and so we want to make sure we preserve that flexibility. um for going forward in budgeting and that's all I got. So, I just wanted to say that I'm really appreciative of this has gone through many budget cycles now. Went through a real tightening of the belt at TCLP to get our pension um liability down and some of the other things that we've I've looked at and we hear and it's gone the fund balance has gone a couple ways where it's been we've got all this money sitting here. Can't we do this project for $600,000 or can't we add this for you know half a million here? And then it's also been but we know we have these huge expenses coming up. This building is falling apart. We've all talked about that for years. And so it's been this kind of holding both thoughts at once without actually having seen it laid out. So I really wanted to say having gone through this several times how much I appreciate this presentation. And just thing I one thing I've been um trying to encouraging the department heads when they come to you with a uh with a project that's not in the budget the in in the motion you'll see intentional use of fund balance. that's drawing down this fund balance. So,

and that's a good point that it has come to us from staff before, but sometimes it's us ourselves too up here as the body deciding to spend money on things that we decide need to be spended on at that moment for better or worse, but we don't have this whole picture. So, I'll open up for anybody's questions or comments. Go ahead, Lance. Yeah. Do we have an estimated uh time in like number of years where we will be spending this back down to below the 20%? I actually think the 20% is a low number. um most of the boards that I sit on, uh it's sort of 30 to 35%. So, um I'm surprised that it's so low, uh at 20. Um I do support unc on capping this or at least changing that uh number in the future. I'm sorry, kind of two questions.

Yeah. So, to answer your question about um sort of the pace at which maybe it would be spent down, I think that's really a that would be the work of the ad hoc committee if you agree to this approach. Uh, and that would be outlined within that. Okay. Thank you. Um, oh, go ahead other. Um, first of all, I want to say it's really nice to see all those murals and other art commission projects decorating. Very nice. Colleen did a great job presentation.

Um, so I I think it's prudent to follow your lead here and wait except I'm really concerned about the striping. What are you know it was it's a public safety hazard. Uh we've got a lot of people coming to town. We didn't have any crosswalks. We didn't have any bike lanes all summer long. Um what is the plan? Do we have stripers coming in the spring? Can we put this off? You know that I know that it's it's maybe a 300 500,000 investment along with the two staff people for that could also work on snow. Um, I just want to keep that up at the front to make sure that we're we're prepared for this summer and we don't have one like that.

Thank you for uh raising that issue. We'll be coming to you here uh relatively soon with something on that and we'll take the direction from the commission at that time. And so I had a question too and I know this will somewhat be the work of the ad hoc but I'm guess I'm curious again this is our first time approaching kind of this holistic view as well as a multi-year budget coming up is in the future as we get kind of our arms around this better and create a new how we want to reallocate is this something normally cities would say okay instead of saying hey look we've got this pile of money it would be we're going to try and over kind of like what we do with the water fund are going to try and over budget in some of these areas in the future and know that there's large expenditures coming behind some of these. Some of them are just have a safe cushion because we have so many different funds that we and that aren't just enterprise funds and so are we going to start looking is that potentially something we'd start looking at. Is that kind of a a basic rule that we haven't always been doing or is that something that'll come out of the ad hoc recommendations? I think it'll come out of the ad hoc recommendations. And I'll to answer your question directly, uh, cities handle these types of budgetary situations differently from city to city. Some cities are very conservative with their uh, budgeting. Others are very aggressive. Uh, you know, you can kind of characterize it in different ways. Uh Traverse City has historically uh been very uh prudent and I'd say conservative to make sure that we aren't caught in a situation that's uh scary. And uh that's really in that same spirit that we're making this recommendation is to not have to come to you in the next couple years with um some very difficult decisions to make.

Other questions? Go ahead Laura and then Mitch. Yeah, I mean I first of all Heidi, thank you. I appreciate the time that staff took to approach not just these different scenarios, but also the multi-year forecasting and budgeting. I think that's going to be really helpful to this body to help inform our conversations moving forward with how we approach the fund balance. Um, I agree with this recommendation. I think it's it's solid. It's responsible. it will give us the time to be more thoughtful and more proactive and less reactive in our approach to the fund balance. So I agree with it. I'm particularly sensitive to the discussion around the pension and the the underfunding of the pension and I I would hope that that can be something that we the ad hoc in September can dive more deeply into because that that to me seems like a big risk for the city and I'm not sure as as a new commissioner up here is has that been a policy of the city to just meet the minimum requirements and is that something that should be revisited because right now when we look at the investments and and the performance of our investments, things are good, but the headwinds could change and and that would represent a significant risk to the city. So, I think as we look at this fund balance and the facility needs, the capital needs, the the um uncertainty of the tiff and the ambulance services, this just makes good solid sense for this city commission to wave this policy for this year. So, thank you.

Yes, I'm curious. We can do as best as we can to plan within our walls and within our city limits. But how proactively are you looking at um that landscape beyond that because last year we did have a federal shutdown. We have had this year a partial federal shutdown and there could be a looming one but on a bigger scale uh the governor announced on a state level which we do get much more money um in her saving Michiganders money plan uh and $90 million in tax break in property tax breaks to seniors which we have more seniors than other parts of the state. So y

uh how well have we been looking at potential changes like that and their impacts?

So revenue projections is one of the big things that we're starting to look at and um I mean I mean on just to be honest the current year's upcoming budget we can get pretty close. we know, you know, where but when you're out two to three years, it's I don't want to say best guess, but it is it's not going to be 100% accurate because one change in lancing can change as we know the gas tax is now longer. So all of that, it's just everything the sale we get a percentage of the sales tax now. We don't get the sales tax because it's a gas tax, but now we get the money for the roads. I mean, they do their shell games and we just try and follow. So, so, um, revenue, uh, general fund revenue is something that we're trying to have a a way to project in in reality, but we we do know it's not going to be 100%, but we will do our best.

And I I will say Oh, go ahead. Please go ahead. You can go ahead. No, no, mine's just an off comment on it. So, you you have a question. I just if you were carrying on that note, I wanted you to keep going with No, no, go ahead. It was off topic. Um, I I wanted to ask about the the MERS pension. And it sounds like with the increase in employees over the last couple years just because of the demand and then the the requirements of increased wages to get them in the door that MS pension slipped underneath the 60%. And that's something that we like to maintain is that 60% rate. That is the state required. That's required by

Yeah. Yeah. We we were put on a a a corrective action plan because we are under the 60% and we will remain on that action plan until we are back up to 60%. We did um reach out to the actuary to MRS. Roughly 1.2 million is what it would take to get us to 60% estimatedly. And just to clarify, just make us to 60%. Just want to be perfectly clear that when we're talking about the pension status, we're not talking about police and fire pension, which is uh better funded uh uh by quite a bit. We're talking about all the other employees of the city.

Yeah. Right. Okay. And and I'm just wondering because I understand how that act 345 pension works a little bit more. It's a snapshot of the amount of employee employees you have over a period of time and what their benefit exist what that consists of but it's a period of time and when you reamortize it it's a new picture and that's what I wonder is how often is this MS pension reamortized so that you can I'm sorry if I'm saying that wrong rea amortize. Thank you. How often is that done to like look at the number of employees you have, the projected retirement dates so that you can like figure out because your your pension funds are never 100% funded. They shouldn't be, right?

But you should know how many people are in your pool and when you expect them to retire and what their benefit should be. We have an actu actuarial report done every June 30th. So, okay. The mer is every year. December. Yeah. Oh, yeah. We get it. we get it by June, but it's for effective December 31st. So, this this 1.2 million is very much more real time that we reached out um when when making this presentation. I just wanted to know what that was um what we would need just to get to the 60% and that is based on the last year's actuarial. So, um it could potentially be more, but at minimum 1.2 million would get us to the 60%.

Okay, that was that was I had a big question. I didn't want to interrupt you earlier and then we kind of started like throwing questions in but that was my biggest question on that mer pension is when was it amor amiratesized I can't say it I app I commend you for trying so many times because I haven't I avoid it I'm not a quitter but um thank you for that I curious and I just Brian uh Postma is here he's um the uh very very uh imperative to the office and my de chief deputy John I just want to give them Uh thanks for everything they've done to help with this as well. Yeah. Laura, you had your hand up.

Yeah. Quick question. So with the ad hoc committee that would be formed in September, would that would one of the goals of that ad hoc committee be to um relook at this policy and the the range of the recommendation, the 15 to 20% and bring forward the new you know stick within that range or are there other options? It certainly would. Uh, yes. And and and I also I didn't comment specifically, but I appreciate your suggestion about it also looking at the pension situation. I think that that's important.

Uh, and I fully support that and we plan to make that part of the scope of the committee. that'll be articulated when the committee is formed so it's clear as to it scope because I mean clearly with you know different than Atlanta's reference to a 30 to 35% we're sitting on taxpayer dollars and we have an obligation to be really careful with that public money I mean to be good stewards of of those tax dollars and so I think looking at that range and and what the various recommendations are and best practices um is really important

and I agree and one thing I was goingonna to say really quickly kind of on that note and a couple of people who contributed to the policy at the time and had very different um thoughts from had a lot of range of where we ended up are here today. But um one of the things that was brought up when we had this policy discussion years ago and I remember was one of the people who was on the commission at the time was arguing, well what if we get floods or something like that and we need to have these this money until there can be um you know make we get made whole again somehow or another through insurance or something. And at the that was an argument for a much larger balance at the time. And at the time several of us myself included said well you know there's FEMA there's all of this other stuff. And historically that has been the case. Now what we've seen in our own state in the last year or two is that's not always guaranteed the way it used to be. And so while we're having these conversations about these very important local things, I think as we are reexploring it and and being conscious of the fund balance, there is the responsibility we have to the taxpayers. Absolutely. Um but that kind of security that we used to have there for some of these larger kind of force majours or act of god that we used to kind of have some more reliance on our partner and governmental organizations might not be as strong as it used to be too. So I think that's something for us to keep in mind because it's a very different mindset I think now from where we were seven or eight years ago when we had this conversation.

It's a balance and I think it's important. Well, yeah. I'm not saying over one over the other, but just bearing that in mind that that was part of the conversation at the time. And I think it's important that every few years this body has an opportunity to revisit those issues and and keep in mind of of that balance and and how we approach it as elected elected officials. Well, and I appreciate um Benjamin bringing it up. K, you had your hand up.

Well, I guess it kind of goes back to to what Lance said. I I like that we keep that 15 to 20% policy for the unfunded or the unassigned general fund that fund balance. Um we keep that low because that's those are tax dollars that some that's somebody's tax dollars that we took that we didn't spend. And if we are going to override this policy, which I do think is a good idea,

um we need to be mindful of how we're spending other monies and we have to take into consideration we're going to get other asks along the way. people are going to be asking for pilots. Um the homelessness task force has, if you've talked to them, if you've seen any of their presentations, they're going to need financial contributions from the city. One of the things that I saw in that audit was $711,000 of marijuana tax money that just goes into the general fund. I don't know if we have ever decided if we would earmark it for things. It's uh there has been allocation specifically for things like

uh not like things such as uh uh police services. Uh for instance, we have uh social workers that are embedded within our police department now to uh help really address some of the more complicated issues associated with uh homelessness for instance. Uh, and so, uh, beyond that, uh, overall, and correct me if I'm wrong, Heidi, uh, it's it's o the rest has really gone into the general fund. If a city commission ever wanted to have a more specific discussion on where those funds go,

certainly uh, we have tried overall uh, and this is to the point that Heidi made earlier that when you don't know for sure what your revenue is going to be, that cannabis revenue is not guaranteed. Uh, and so we uh try to not fund things that are ongoing. I know I just mentioned social worker, but they are also uh uh partially covered by grant revenues too. And that's something that um uh the folks in those positions are aware of.

Just to call out too, we also knew this year um and you'll see it in the budget documents, we created a new um department uh substance response. So, the COAP grant, the um opioid, and the marijuana revenue. Um we're trying to not tie it out one to one, but so for easier tracking for anything that the police department does, anything that has um related to those topics, we've created a separate department for tracking. So hopefully we can get a better idea on those expenditures. I mean, that's that's in my mind that's been money well spent. They're doing such a good job. they're presenting at conferences around the country with the work that they're doing here in Traverse City. So, I I'm completely pleased with their performance and that, but I'm just

I think about that money because there's going to be an ask relate we know it's coming related to homelessness services. So, and I think about that marijuana tax money as an opportunity for that. I don't know if it's something for another discussion for another day, it but it probably would be. I would say that when and I don't think this was an official maybe it was an official policy passed by the city commission but as the one who spent five and a half years on the cannabis adox um I can tell you that when it came to the commission it was recommended that it come specific and we were actually the money and the conversations were happening at the same time we were finding out about the opioid settlements that we are a part of still

um and all that one came with strings attached to it the opioid settlements did but the conversations we had about the cannabis was how are we going to use these in kind of community enrichment if it's kind of another vice tax if you will that we're going to be taking in how do we use this to improve the health and wellness of the community that's where the conversations came about of having that's when we got our first social worker and things like that and so that was able to help us have this true community policing and focus on the issue through that those fundings if as we go to our strategic plan and we've all talked about and I had the opportunity to spend a few years during the policy conference we get some kind of tourist tax for example that does end up bringing money into our city. That would be another opportunity for us to look at a new income revenue stream in addition to everything else that Benjamin's talking about and all these other conversations we'll have of this is a new revenue stream coming in and how does that play in this bigger picture as well and where all of our obligations and desires kind of land. So, I mentioned that again in case anybody runs into any of our state reps or feels inspired to send an email about any of that. the that would be a helpful helpful thing for our a regional city like ourselves. So,

and I'm meeting with our US senators next month and we're going to highlight some of those needs. Fantastic. In DC and just uh working on the uh marijuana uh the revenue projections. It's based on the number of facilities within the city and that number is going down. So, it's the city and the state like the pot we get depends on how many are in the state total. within the city and comparative pot on purpose. No, I didn't, but thankful for that. Um,

they're giving my giving my slightly co rattled brain a little more credit than it deserves this evening. Um, no, and I I point that out because as if there's more cities that opt in, that pool becomes diluted again. If we lose shops, the pool changes as well. So to the point that was made and to your question, Ken, like that can that makes it revenue we know we have coming in. What it looks like and the you know the huge pile of money at the end of the rainbow that we were promised is there's money there, but what it looks like and what it's going to look like long term is up to a lot of variables. But I just think that if if we're going to go over this 20% and we're going to start sitting on people's tax dollars because that is

we're going to put them to good things, we should really have tough conversations about wants and needs. Like is this something that we have to have or is this something that we think would be fun to have? So it's almost a perfect segue into the next uh agenda item, but it's it's a real conversation and we're having it here tonight. So, yeah, very good point, Lance or sorry, Lance and Ken. Um, anything else on this before we move on. All right, great start to the conversation, I think. Thank you for that, Benjamin. Thank you.

And with that, we will now move into the tax increment financing impact and outcomes. And I'll leave give that to you, Ben, and then I will um go ahead and go ahead and give it to Heidi. We we only have one public comment on the end of the study session since this is all budget conversation tonight.

All right. So, uh, you have in the packet a presentation that has been updated a bit and I'll reference how it's been updated throughout my comments. Um, we, uh, of course from an administrative and financial standpoint, we just got done with budget related discussions. I need to have direction from the commission, uh, as we look ahead to forecasted uh, budgeting, fund balance strategy, long-term planning. Of course, that includes how we fund core services as well as strategic investments. uh and these decisions, the decisions made around TIFF 97 will affect how we plan for those items. And so uh uh tonight's presentation focuses on the income, excuse me, the impacts and outcomes related to TIFF 97 as the plan uh approaches its scheduled expiration at the end of 2027. Uh our goal, my goal this evening isn't to advocate for a specific outcome, but to provide clear, factual information about what TIFF 97 currently supports, what changes if it expires, and what options exist moving forward so we can receive direction from the commission. So we'll move on to the next slide and talk about why we're here. Uh as you're aware, and I just mentioned, TIFF 97 is set to expire in 2027. And from an administrative and financial standpoint, direction from the commission is needed as we look ahead to, as I had just said, uh, forecasted budgeting and so forth. Uh, this includes how we fund core services, uh, as well as strategic investments tied to the city commission's OKRs and the strategic action plan and the decisions made or not made around TIFF 97 directly affect how we plan for the next decade and beyond. move to the next slide and I'll talk about what is tax increment financing. Uh before we talk about its uh impacts the impacts of tax increment financing I want to ground the discussion in what tiff is and what tiff

is not and simply put uh tiff is not a tax. Uh it captures the increase in taxable value within a defined district above a base year. Only property owners within the district contribute to tiff. properties outside the district are not affected. In the case of TIFF 97, the captured taxes are collected by the downtown development authority, not the city or the other taxing jurisdictions. Uh, importantly, TIF does not raise taxes. Property owners receive the same tax bill whether TIF exists or not. Uh, and so if TIF expires at the end of 2027 or it's renewed, the tax bill does not change. The base taxable value contri continues to flow uh to all taxing jurisdictions. Only the incremental growth shouldn't say only the incremental growth is captured and reinvested locally. Uh pro project expenditures uh within any tiff plan require public approval by both the downtown development authority and the city commission. And the tool was originally designed to do essentially three things. fund infrastructure and public improvements, support economic vitality, and reduce long-term pressure on the city's general fund. And we'll move to the next slide and I'll talk about the context of downtown. Downtown does play a unique role in the city's financial and operational landscape. And while TIFF 97 uh district represents 2.6% 6% of the city's geographical area. It accounts for approximately 13% of the city's total taxable value. Downtown is also an area with a high concentration of streets, sidewalks, utilities, public spaces, daily use, and events. Currently, TIFF 97 captures about 4.5 million annually. The city share or what I should say is

the city originated tax revenue captured by the DDA under TIFF is approximately 2.6 million. The non city share or the non city originated tax revenue captured by the DDA is approximately 1.9 million. Uh and so I just want to be clear about the meaning of city share and non city share. uh that we've edited that uh throughout the presentation to make it clear that city's share is really considered to be the city originated tax revenue captured by the DDA and the non-city share is the opposite. Uh moving to the next slide uh five which is uh alignment with commission priorities. Uh as uh everyone just heard from our finance director and myself, uh the city's working uh to be more strategic and forward-looking with fund balance and long range budgeting. Uh the city commission adopted OKRs and strategic action plan provide a framework for investments beyond core services. Downtown intersects directly with those priorities and it includes things such as this is again in the OKRs refocusing downtown as a neighborhood, regional collaboration, public realm and placemaking investments, infrastructure stewardship, economic stability and resilience, mobility initiatives, and environmental sustainability. We'll move to the next slide. TIFF 97 has supported several projects. Notable projects listed here encompass approximately $21 million and public investment over time. This isn't a full uh list of investments made throughout the plan. And these investments include both capital improvements and ongoing asset stewardship. And you can see them listed here on this slide. Again, this is a a sampling of some of what we consider to be notable past investments. We'll move to the next slide. Uh, a

healthy downtown uh requires ongoing investment with or without TIFF. I strongly uh believe a healthy downtown makes for a healthy city. Uh, currently the DDA provides $630,000 annually to the general fund through a service agreement to offset city services including treasury, uh, human resources, engineering, DPS, and parks. Sorry, like I said, I'm dealing with a cold.

Uh $80,000 annually for trash and recycling. And the DDA also supports beautifification and holiday lighting, which do not have fixed annual dollar amounts, but do represent a meaningful operational investment. Currently planned or active capital projects include the farmers market, Rotary Square, lower Boardman autoway improvements, including uh importantly the replacement of the 100 block pedestrian bridge. These items do become important when we uh later discuss how the city's share is calculated under different scenarios which I'll walk us through in a little bit. Next slide. Uh citywide investment pressure. The city does face significant investment needs both downtown and citywide. Uh the community prioritized projects will require strategic investments for corridor improvements in areas such as 14th Street, 7th, 8th, and Garfield as well as public space enhancements enhancements. At the same time, we have to continue investing in core services, street rehabilitation, water and sewer infrastructure, and asset management or maintenance. If TIFF 97 expires, I just want to share and I will walk through candidly what the different scenarios look like. The general fund becomes solely responsible for all pro projects and programs in the district. We do lose a local regional funding mechanism and the city's ability to leverage growth for capital investment is reduced. Competition increases for both general fund dollars and external funding such as grants. And I will say importantly also uh if TIFF97 expires, you know, the other side of the coin, if you will, is that the city has more flexibility on how the funds are allocated. I want to acknowledge that because that is true. Uh the next slide, uh capital improvement plan context. This slide shows a uh snapshot of draft

CIP projects within the TIFF 97 district over the next six years. It's not a comprehensive list of all TIFF supported activity, but it highlights some notable projects that could could be funded through TIFF, not necessarily have to be. Uh, some projects would move forward regardless of TIFF. Others might require additional funding. Uh, for example, the Brown Bridge Trust Fund Lakeshore Restoration will likely need additional funds to be leveraged to be complete. Also, East Front Street uh is identified as being funded mostly by TIFF 97. Uh but we'd have to ask our question ourselves, you'd have to ask questions like what type of strategic investment do we want to make in that corridor? Uh the project cost could stay the same with or without TIFF. Of course, the the scale of that project can be modified. It can be scaled up or down. Uh and also important, this list doesn't include general maintenance, which do does uh remain a core service obligation. We're going to move to the next slide and I'm going to overview four different scenarios. uh and I'll talk through those different four scenarios and illustrate the financial implications and different paths forward. One is for TIFF 97 to expire. A second one is for TIFF 97 to reset. A third is for TIFF 97 to extend, excuse me, and the fourth and final one that we'll go through tonight is TIFF 97 extending but with an amendment to reduce the capture. In other words, to to share some of that uh capture back with the taxing jurisdictions. Scenarios two through four are calculated as TIFF resets or extends in some way before expiration. And we'll move to the next slide. Okay. And this this scenario is TIFF 97 expiring. Uh so if TIFF 97 expires, no tax

increment is captured. The city's general fund would receive approximately 1.32 million annually net of the service agreement, trash and recycling costs uh and millages. Uh so that would be 1.32 million uh annually that you'd have flexibility to spend anywhere uh throughout the city. The figure increases over time of course as a tax base grows. Uh but importantly the non city share uh or the the tax revenue uh from other jurisdictions uh that we would otherwise get about 1.9 million annually would no longer be captured uh by the DDA and flow uh to the jurisdictions. I want to importantly note that once TIFF 97 reaches 30 years uh if any of the scenarios that DDA has committed to no uh longer capturing the fire millillage. So I wanted to highlight that uh under this scenario uh the city funds assume full financial responsibility for the TIFF 97 district and prioritization would have to happen around things like capital investments, infrastructure maintenance, beautifification, holiday lighting, trash and recycling uh as well as the downtown police officer. I'll move on to the next scenario. This is if TIFF 97 resets. So in this scenario, uh, TIFF would reset to zero in 2028 and capture would only be on new growth. Uh, all of the growth in the prior 30 years would return to the taxing jurisdictions. Uh, spelled out in scenario one. 30 years is the maximum statutory term. I want to highlight that it could be less. A shorter term is possible. Uh, over a 30-year period, the projected total capture is 65.55 million. uh 36.5 million in city tax revenue that would be redirected uh 28

million in non city uh taxing uh revenue. Uh and so if this were a preferred direction, of course, we'd have to have some intentional conversations to ensure strategic alignment with the DDA. We'll move to the next slide. Scenario three. This is if TIFF 97 extends. Uh in this scenario, TIFF 97 would continue as currently structured. Uh the projected 30-year capture would be 213 million. 121 million would be uh city tax revenue that would be uh redirected and 92 million would be the non city tax revenue. Uh and again uh it's up to 30 years. You can go with less if you wanted to. Uh as with other scenarios, this again would require uh coordination and alignment with the DDA. Then we'll move on to the next slide which is the fourth and final scenario. This would be to extend TIFF97 but with a reduced capture. Uh this scenario introduces certainly more flexibility. Uh the base year would remain uh or could remain uh 1997 but the capture is reduced through a plan amendment. uh and the capture would begin only above an amended threshold either a later year or reduced percentage to illustrate and I say just illustrate because there's a variety of ways to structure this uh we've shown a 50/50 example so this means 50% would be uh uh captured uh for use within the tip district the other 50% would remain with the taxing jurisdictions if this were done over a 30-year period the total 30-year capture would be6 6 million 50 million would be returned to the city's general fund for uh use in any fashion. Uh 10 million would be returned to the act 345 pension system for police and fire and 46 million would be returned to n uh taxing

non city taxing jurisdictions. Uh and again this is just one illustrative example. There are a variety of variations. could be 100% for a defined number of years, an 8020 split 40%, you know, there's a range. Uh, and again, it would require a planning and alignment with the DDA. Uh, and then we're going to go to the next slide and just give the snapshot of uh the different scenarios. Again, scenario one, TIFF 97 expires. Uh, there's uh zero that's being captured. Scenario two, TIFF 97 resets. Non city uh share would be 28 million. City share 36 a.5 million. Uh scenario three tiff 97 expires. Non- city share is 92 million. Again that's non city originated tax revenue increment captured by the DDA. The city share uh would be 121 million. So yes you can see that the city share is greater uh than the non city share. Uh and that is important to note. Scenario four is tiff 97 extending with potent a plan amendment to reduce capture. We gave the 5050 example where the non- city share would be 46 million and the city share would be 50 million. This is a lot to digest. I uh respect that. Uh but we've tried to boil it down in hopefully as objective a fashion as possible and then we'll go to the next slide. There are some limitations with uh tax increment financing. We have a charter provision that was approved by the voters in 2024 uh that requires uh that the city commission can no longer approve or amend a tiff plan without a vote of the people. Uh and ballot proposals do apply to all types of tiff including brownfield. So I just wanted to highlight that uh even if a tiff plan is proposed, it first has to now be approved by the electorate and then even

if approved by the electorate, the city commission has to also then approve it. And uh we'll go to the final slide. Uh and this is where either tonight or relatively soon, if you need some time to digest, we need some city commission direction. uh if there's a preferred tiff scenario or scenarios that you'd like some further analysis, if you need clarification on anything, uh we need guidance on alignment with the OKRs and strategic action plan priorities and then direction on governance and oversight considerations. That's a way of saying uh if there's a direction that you want to give to the DDA board uh for them to take under consideration. And so I know that that is a lot. Uh it this is a conversation I feel the responsibility to bring to the city commission and the public to illustrate uh the uh items to consider. There's certainly others to consider but I tried to uh keep it uh fairly concise. It is a complex issue.

Um I just wanted to say two things really quickly. One is because you were you're very delicate language. I appreciate that. But the non- city money if if it goes in the scenario one you you said like it goes back to the taxing jurisdictions that's money that doesn't come to the city anymore. It does not come. So I just want to be very clear

um for the public conversation. Now what I will say is because it does go to the vote of people first. There is an ad hoc currently convening for the um with the DDA that DDA members are here tonight. I'm your representative on it. So certainly though we do not get to discern determine what this might look like or what the vote of the people will be. If there are preferences or ideas that you have based on this presentation, you can share them here that can be conveyed. Um I would also say that there is a plan at some point after the DDA ad hoc has had some time to work to bring some of the initial ideas in a joint session with the city commission as well to get feedback. So this won't just happen in a vacuum and then be sent off to the voters and never have city commission input. So here there's some opportunity tonight. You can always share with me. You can share with Harry at the DDA too if you think about this and something occurs to you later or as we bring back something that's closer to a plan that would be voted on, we would we're going to do a joint session with the city commission as well. So I just wanted to give you all an idea of what that part of the process is going to look like.

One point that I wanted to make is scenario two. If TIFF 97 were to reset, I mentioned uh 36.5 million city share, 28 million non city share. Uh 28 million is what you might call a best case scenario. And I say that because if you reset TIFF 97, the taxing jurisdictions can opt out. Uh they have that option under that scenario and I just need to make sure that you are aware of that. Thank you. So do we have any thoughts anybody wants to share? Okay, Mitch.

Yeah. uh question. Uh in scenario two, a reset, is it um required that it reset to the new year or could we have it reset to say 2020?

It depends on um how you do it. So if you extend it, if you if you reset it to like 2020, um that's more like one of the further the scenarios further down because you would have to extend it and then you and then you would either do the cost sharing or you would you would change the base year. There would be a mechanism to do that. Um, but if you just let it expire and then reset it, then you start over from the tax year that you're, you know, the new tax year that you're starting with, 2027 or whatever, whenever that's adopted and it would be voted on and then at that point also the taxing jurisdictions could opt out. Thank you.

Other questions? Go ahead. I guess um because it's going to whatever happens is going to get voted on by the charter amendment. What is the sequence of things that are going to happen? Are we going to like we do you want input from us tonight so that you can help the DDA formulate what they want to put on the ballot will we vote to as a commission to approve it then it goes on the ballot

or once it's whatever is voted on for the proposal do we then vote on that as a commission approving whatever the voters approved. Mhm. So, um I think that's sort of what uh Benjamin alluded to with the the city and the DDA board needing to understand that and work together um on alignment in in uh advance because the city commission would not vote on it prior to it going to a vote. Um it uh the way that uh it's going it's going to be implemented under the policy that was approved is that all of those steps leading up to that um the DDA would take all of the steps that they take under the statute to bring the plan and recommend it to the city commission but before the city commission would act on that it would go to a vote. So, our input is going to help the DDA formulate whatever plan that they're going to put together for a proposal for the for the ballot.

Yes. And that's also by design because at the end of the day, and I say this with respect, that the DDA uh exists potentially as a funding mechanism, an opportunity to leverage a funding mechanism if it's a desire of this community and city commission. And it's important that they take I say this humbly uh but uh the city commission's input into strong consideration. Uh and so that is part of the purpose of this discussion is to uh signal and be clear to the DDA board on uh how they should be shaping the plan that they're putting forward. Mitch,

yeah. Is there a specific timeline that is being looked at for that ballot amendment like I mean ballot uh initiative would that uh have to be in November of this year or next year or could it be in August of uh this year or is there some other the ad hoc is going on that it will be on the November ballot this year or next year? this year, but it but if if and that's because if if you desire if if you waited until next year, it automatically uh either it's it's expired at that point. Uh and so I mean that's that's an option, but that would happen by default. Yeah.

Heather had I have a question. Um it in one of those slides it says notable past achievements uh $21 million worth of projects. I' I'd like to know is um how much TIFF 97 has actually captured in the last 29 years and what percentage of that revenue went to um debt service and administrative you know transfers versus new capital projects. The latter we'd have to get back to you on. I can tell you of course we've got one more year left but the projected total capture is 4.869 million over the 30-year period or

oh excuse me. Um that's that's that's um annually. Excuse me. I I need to clarify this for you. Much lower, isn't it? Yes. Yes, it did. Yeah, we can get you answers to those questions. Yeah. I'm sorry again. I have not the best brain right now with all this cold medication I'm taking, but we'll get you clear answers to your questions. And Ken, you had your hand up and then Lance.

Okay, Lance, not Ken. I I think one of the we we um some of us looked through all of the the audit and for 24 to 25 it mentioned in that audit that there were four bridges and that the city share of those four four bridges in the downtown area that were um redone, repaired, rehabbed. 1.72 million went towards that. I'm curious what did the DDA put towards that? like questions like that. I think

kind of piggyback on Heather's question is a lot of the slides we just saw advertised continuing TIFF as an opportunity to fund infrastructure and I I'm curious how much has actually gone to infrastructure in the last 29 years

and I think that's going to be telling. I don't know the number. I truly do not know that number, but I know that the number that the amount that the DDA has collected over time has gotten bigger. So, they've been able to to accomplish larger scale pro uh projects. I do appreciate the revenue sharing component of that because we have a a tax increment financing tool. The government will say they'll match certain funds. So, I I am sympathetic to that. I like that. Um, when you look at these scenarios, I think something between scenario number two and number four, I don't I do not support the extension of it as is scenario number three. But I think it goes without saying that whatever ends up on that ballot proposal, if it fails, if if it doesn't pass, that means that scenario no or scenario one is what was what a no means. So I I think that goes without us. It's pretty self-explanatory. So

Heather and then or actually Laura hasn't spoken yet. Laura and then Heather. Did Lance go first? Oh, Lance wave.

So I I think it's important that we acknowledge TIFF is an issue that has many different perspectives in our community and likely even up here on the DAS and I think it's important we acknowledge that openly. Um, this is a huge decision for our community. Significant long-term decision. It's, as Ben said, it's a lot. And it's likely going to take multiple meetings, engagement with community leaders, and significant continued analysis before we land in the right spot. And as Ken indicated, we have an obligation to set this up for success. Otherwise, the answer is scenario no. Um, so I think a couple of things I'm hoping that we can focus our conversation around things that we agree on.

Um, and and TIFF is a a regional cost sharing tool. We have a downtown that most communities would love to have. And I have to agree with the city manager that a healthy downtown is a healthy city. It's a reflection of a healthy city. Our downtown is a source of pride for our community. It's an important economic engine and it's a place that brings people together for many of us. It's a strong part of our identity as Traverse City residents and those things matter. It's important and so again that gets to why I think this conversation and these ongoing conversations are really important. Downtown is a regional asset. It's for me I struggle as I talk with members of our community and learn more about the different perspectives. In what scenario does it make sense that one city, 15,000 residents, has the obligation for a downtown that is used by 50,000 people every single day. And so I think that also can help frame some of these conversations. Um, and I think those are fair questions to ask.

Heather, go ahead. Um yeah, mine is looking at scenario three, which is the one that the DDA would like to have happen, which extends. Um it in the tiff 97 very much underestimated the property values uh the growth in tax capture over the years like my 35% which is a lot and and yet uh scenario three and um and what the DDA has has presented and they're moving downtown for is is also pretty conservative. So what where's the evidence that supports that we're going to not have that the next 30 years will be materially different from what happened the last 30 years? So that's my first question. Um and my second one is what is this 30-year extension? What problem is it trying to solve that can't couldn't be solved by a shorter term or a shorter capture or some kind of hybrid model? And I think that that this speaks to what Lance said at the during the last conversation is what are we talking about here? Are we talking about stuff we need? We talking about stuff we want.

And Heather, I think what you just hit on though you kind of framed it that you think that there's a predetermined outcome by the ad hoc. The ad hoc is exploring how many years. It doesn't have to be 30. The ad hoc is looking at is it a renewal, but is it a renewal with the sharing in it, which would be an amended plan then? Because if we do reset, it does get into and that is on the table. Reset is on the table, too. But as was mentioned, if we reset, then we potentially lose that 1.9 million or whatever it might actually be of the non- city funds because everybody can opt out if they want to. And so these are the conversations that are going to be had at that ad hoc as well. So I appreciate the questions and we'll certainly carry those as well. What problem are you trying to solve for the next?

Well, that's what the plan will hope to include. So if people have ideas on that, I know we've talked a ton about infrastructure. I think that's something to Laura's point that we what are things we agree on. We agree on infrastructure. Do people want to drill down before you know whether it's now let Harry know, let me know individually, not collectively because I'll take it to the ad hoc, but we can't round robin. Um I think have them let me know.

Yeah, let them know. And then let but also then the joint meeting we have will be opportunities to even be more specific than just infrastructure or you know is it storm you know storm water I think is on everybody's list but are there other specific things that we see that we want Lance

uh I'd just be curious um just for an analysis around what projects infrastructure projects have been completed um and then what do the future liabilities look like surrounding those projects um you know just thinking, have we bonded for some projects? And you know, does that bond payment now come to uh the city's general fund uh without TIF? What does that look like? What's our projected necessary uh expenses? Um and then, you know, that's that kind of helps answer I think the question that Heather also had.

Yeah. And along with that, I would say in the context of our last conversation, some of these bigger ticket items that we're all talking about and thinking about, how many of those are within the DD like the DDA tiff boundaries that potentially that could assist with then in the long term as well. Yep. Laura,

yeah, I I agree with um both Heather and Lance on this question of um what are the outcomes that that we are expecting and how do we align ourselves as a group on those outcomes? So, what do the projects look like and what projects have already been committed to? What projects fit with our strategic plan? Um, is it the moving downtown forward plan, but some of that has already been stripped out. So I think to really answer this question and to direct ourselves on one of these four scenarios, we have to have an understanding of what the the end cost is of these projects that we agree on with the DDA and then how do we get there? That that's the piece I feel like we're missing and looking at I mean we I think we I understand in looking at the one slide, Ben, it'd be really great if we could have the slide with the scenario one to that one. Um, that's really helpful. So, I that's a that's an important question. I think that we have to have a better understanding of

that. I'll just say real quick and then Heather, I do see your hand up. That's the work of the ad hoc. I think to be fair, the ad hoc is starting with the move the iteration of moving downtown forward plan that was passed previously. That's not inherently what will be passed, but there is in within that the boardman storm water parking was in it previously. I'm imagining that'll be pulled out unless the city asks us to because the city is in charge of parking now. Um, so that's something to think about as well. Despite what might have been put out there, there was never there was not a parking deck in that. There's no intention of having a parking deck in that to my knowledge. That's something the city wants. Then we need to be clear that that's something that we would like to see in that plan. Um, so using that as a basis of seeing what's there, if there's other there are other things that you feel are missing, then that's where you convey it. Now we're it's but it can't come to us for a vote first before it goes to the ballot. So that's where we have to keep in mind of this process

where we have our inputs and you know letting Benjamin know at any time obviously whatever gets developed in the ad hoc will be brought as a joint um session here to have everybody talk about I would hope that our commissioners and all of us are communicating enough that there's no giant surprises that five commissioners hate the entire plan. Um so keeping that in mind of the communication as well. Um so that's I think that's where we have some answer or I can say we have some basis to start that with your questions but we don't have those answers right now nor will we until we have more meetings and discuss

because I think if we're if we're clear on that this thought process up here and and this level of communication back and forth with the DDA is then the the right funding structure which one of these scenarios fits will become much easier for us to evaluate and then set it up for success in the ballot But that's ultimately doesn't I appreciate how this was presented to us as what do you prefer. We don't have the final say on which one fits because we don't have the vote on it before it goes to the people. So what that's what I'm trying to say is the input that we give along the way. Right now your knee-jerk might be just let it all go or knee-jerk might be let's renew it but with a share. But as we talk about the plan and as it goes forward there's going to be chances for input. But that's ultimately going to shape what goes to the ballot. We do not have that final say where it comes to us to say we're supporting.

I think I think then the input is uh that needs to be shaped around uh strategic outcomes, right? That's what I think the three of us are are probably saying is like if we're going to create anything if we were to give our opinion if I am giving my opinion uh show me the outcomes and show me how the plan is shaped directly around those outcomes. I think it probably looks something like scenario four, but I I don't really know, right? Because I don't know what the outcomes are, right? And that's and I will say the strategic plan and our OKRs and everything are part of the conversation at the ad hoc level, too.

It should add up. And then I think that our discussion and our um visibility and conversations with city residents and and community engagement can help shape the strategic direction of what that looks like so that it can be set up for success. I understand that we're not voting on which one of these options is going to move forward. That's ultimately up to the voters. Um but I think that we can play a large role in setting this up um strategically so that it's successful so that it's not as Ken said scenario no. Right. Rich, you raise your hand and then Heather. Oh, Heather, sorry. I've been waiting.

Heather, thank you for the reminder. have had co thanks for your patience and and I as representatives of the city we were elected by the city I'm listening all the time so I agree we can set this up for success we you know we're not voting on obviously something that voters are going to vote on but we can help

make it successful but to get back to this whole strategic outcome thing you know our our uh OKR is refocusing downtown is a key neighborhood and I think that some of that is bringing population in there so it's actually a neighborhood but um you know with 20 2.6 uh of the land mass in in Traverse City and 100% of the post 1997 um tax growth captured by the downtown. How how does that align with uh the sta city stated goal of treating downtown as one neighborhood among many? I think this is a big question that needs to be answered.

Good point, Mitch. Yes. In terms of additional questions, one that I have is would take some homework. uh how much of the projects that have been done and other resources has been funded through outside grants and uh as a subset of that how much of that is uh grants for which we were specifically more eligible because it's a downtown DDA and a DDA TEF that's a good question

since there are certainly criteria um from bridges to uh community enhancements that the fact that it is a DDA and is uh matched through a DDA tiff structure does allow us to score more highly. Yeah. And that to the point about the Ken brought up the bridges, my recollection and is that that was predominantly paid for by grants and to funding and very little from actual city general fund. Um but that's where we'll get those numbers. I'll help Heather had her hand up again. So, um, to maybe move this along, thank you.

Um, I I've heard from a lot of people that they prefer scenario one. So, I would like to to hear something about um some information about information about how much the DDA will continue to receive from their mills from the downtown businesses. That would be good to know, I think, as well as the Oldtown TIFF. Um, and anything that comes from the downtown Fair Traver City Association, which is probably minimal. Um, and I'd also maybe you can throw in there some options for special assessments or a um shopping district model. Uh, so scenario one I'd like to see more of. And the other one is scenario 4. I'd like to see an 8020 split uh on that one. Um, without I'd like to see it w with the capture from Beta Veterans Affairs and Commission on Aging and without that. Um, I I I'm leaving the county in there because I think that a healthy city also makes for a healthy county and I think that those dollars are valuable to them as well as to us. And so scenario one, scenario four.

Thank you. That's helpful. I would like a little bit of information too that you just reminded me of Heather. So, thank you. Of um this came up, I can't remember if it was at a DDA meeting or at a city commission meeting, but it was mentioned that about a manhole cover meeting be repaire replaced. I think it was a DDA meeting. If that happens on 8th Street, the city pays for it. If it happens, then the DDA, the DDA pays a fee for that. And so I'd like to know if this goes away, the feast that the DDA pays us now to do what we do for other neighborhoods without a fee, what would that transfer look like of kind of on the city budget as well? Sure. And then Ken had his hand up and then back to you.

I guess the the last thing I really want to say about it, we're you're looking for some sort of like pearls for this like things to think about and talk about and include in whatever gets presented some sort of way to I don't think it's revenue share is or revenue share is however much money the DDA captured a percentage of it needs to be available to the city for like we talked about those one-time things opera house roof everybody benefits from that it's in the DDA district Carnegie building we have major heating and cooling issues that need to be addressed with that so some big expensive items Um, same thing with some maintenance issues over at the Beiju. So, those buildings are in the DDA or in in the boundary. And when we said, "Hey, can they contribute to that?" It was, "Sure, we can, but how much?" Like, let us know. I would like to have some of that money available for these kinds of costs that we have. So, maybe some sort of component where there's a percentage available for the city to access that's not designated. I know they're saving money towards these major infrastructure projects like the farmers market pavilion and they want to do the lower board in the restoration. They're kind of carrying that money over year over year to kind of help help it grow, but we also have those needs as a city that are not being met because this money is being captured and not coming back to the general fund. So maybe some sort of mechanism that can help with that for scenario four.

Really quickly though, um in the Carnegie building or sorry, the opera house building is absolutely correct. Is Carnegie in Oldtown? Yes. Okay. I couldn't remember. Sorry. All three of them are Oldtown Tiff. Yeah. I couldn't remember if it was just outside 97. Yeah. No. No. Carnegies in Oldtown, but Beiju's in and Oldtown's got several more years left on it. So, that's fair. Yeah. Um, go ahead. Yeah. I just wanted to you mentioned the manholes coming off in the downtown and what the effect would that uh what effect that would be on what would have if tiff went away on the general budget. Isn't that part of the service agreement that's going on right now? $630,000.

We'll get you clarification on all these items uh in writing. And you know, I think that that service agreement's only been around two, three years. So before that, the city was paying for everything. Um, yeah, we can we'll get you all that information on that. So, yep. All right. Any other thing else before we move on?

So, what direction, Ben, do you need from us? Is it which one of the scenarios were more interested in? Is it what questions we have about this? I just want to make sure you have the direction that you need. I appreciate as this conversation has evolved, I think it's helpful that we've gotten or receive from you additional information that you need and we will work on providing that in a relatively quick time turnaround but taking enough time to be accurate uh and with everything else going on. So I think the next step is really for us to return to you with that information and then continue this conversation. Thank you for asking. He's an old town. I was wrong.

Okay. So for me, I I'm looking at primarily scenario four. And then in order to evaluate the efficacy of that option, I'd have to understand what is the math going in, which it sounds like that's going to be coming more from the ad hoc. Is that right? Um so the list of projects and and how those are sequenced over what years and that gets us to the whether it's 8020 or 6040 or 5040 or 2080 I don't know I can't do that math without an understanding of what are what are the projects what are the outcomes that we are trying to address through this regional cost sharing tool

and Benjamin will bring that back as you mentioned but also in the meantime if you have other questions or wish lists or Anything else? We go through bed. We go through bed. So, and he's talking all the time to everybody. So, okay. With that, we will now move on to our last agenda item, which is the um farmers market pavilion. Just going to turn this uh Harry is here. Yep. Harry Burke Holder is the director of the DDA. And I think Harry, you're going to present this, right? And Okay, great.

Good evening. Nicole Vaness, parking mobility director. Uh just wanted to introduce this item. This is in our CIP for the auto parking enterprise fund. Uh as an introduction, this is a reconstruction of parking lot B. We have the opportunity to partner with the DDA with their project. And with that, I will turn over to Harry.

Was it for introduction? Good evening. Uh nice to be with you and really excited to talk about this exciting project. As Nicole mentioned, uh this is a really a one larger project with two main components. one component being the reconstruction of lot B uh which includes also a significant um investment in storm water as part of that lot and then the other um portion of this project which I'm going to talk about is the farmers market pavilion and u this project has been under discussion for quite some time um if we go back to one of the first investments in the DDA and tiff it was those blue awnings that used to be in the farmers market so this really has come full circle um but in 2016 2017 the DDA had engaged with some consultants uh to come up with a conceptual design for the farmers market. Um and we did and we had a great conversations and then when we started looking at the potential location for Rotary Square we essentially paused in that process to see if the farmers market could fit in Rotary Square and then we had COVID and we had some change in leadership. So this is where we are today. over the last uh almost six or seven months, we've been working with the same consultant to take that original plan from 2016 and talk about how it fits within lot B as it's being reconfigured. And I will have our consultant talk about why we're doing that. Um but we're excited to get your input tonight on the potential scope of that project. We're thrilled um that we're having this discussion. Um you know, we talked about the strategic action plan and the OKRs. I think this project from both from the pavilion and the market that it supports either directly or indirectly touches at least four of the strategic pillars that we've been talking about over the last several months. Um so excited to see this uh conversation continue. I'm going to turn this over to um Chris Good who is a partner with Beck and Raider who's been helping us essentially since 2000 2016 with the conceptual plan and then the plan that's in your packet today to

talk about the overall scope of the project that includes both the farmers soccer pavilion and the parking lot.

Thanks Harry. Uh and good evening everyone. I apologize uh first and foremost um I do have a copy of the presentation with me that says city commission instead of parks commission with today's date but um trust that uh the presentation we have in front of us is the exact presentation I have on a flash drive here. So uh just to move on to the first slide in our presentation uh we're going to talk about a couple of things. We're going to review the 2025 farmers market uh from just last year and understand how that has bearing on the uh reconstruction of the parking lot and the addition of a farmers market pavilion. Uh and then we're going to talk about the 2017 concept plan that we developed and how that evolved uh a as it is married to the 2023 parking lot plan developed by city engineering which begat the unified market plan that we are bringing forth to uh potentially go out to bids for. So if we can move on to the next slide. The 2025 uh market layout as you see here uh there were 74 vendor stalls in in this past year's market. that's been uh fairly common for the the years preceding that. Uh it provided for 66 vendor stalls with vehicles uh and eight stalls without vehicles. And uh what you can see here is that uh and if you've been there, as I'm sure most of you have to experience it, you basically have two double loaded aisles where uh the uh customers can walk uh in the parking aisle and visit vendors on both sides. uh and it's a very efficient layout both for the vendors and for the customers. Uh if we'll move on to the next slide then uh this is the 2025 non-market day plan uh excuse me 2017 2016 plan that we developed. Uh it basically uh is a further development of

the exist parking lot as it exists today. And so, uh, you put the pavilion in the center of the parking lot and we're allowed to have a, um, double loaded vendor aisle in the center. If we go to the next slide, there we are. Uh, so everybody, uh, the vendors load the pavilion and the customers can, um, use the 10-ft aisle in the center of the pavilion to access all the vendors. And then on the south side of the lot, we would have the um vendor tents as you often see now uh which would somewhat emulate the blue awnings that Harry referenced uh a little early when he was making the introduction. So this plan in 2016 2017 provided for 119 total vendor spaces of which 56 pavilion uh spaces are provided underneath the pavilion with 39 uh paved spaces and then 24 spaces without parking stalls. So, as you can see, the 2016 2017 plan provided for additional vendor spaces above and beyond uh what the market was capable of currently. Let's go to that next slide then. And this is just some uh renderings of that 2016 2017 plan. Um basically you can see uh in the uh the profile the uh vendors double loading into the the pavilion. Uh and you can also see that same uh area with just parking. Let's go to the next slide then. So then we come to 2023 and city engineering worked hard to redevelop a plan for this parking lot and ran into a little bit of a wall in that that red line you see

there is the MDOT rightway and the limits of the city property. And the problem became that we no longer are able to have four rows of parking. We're only uh able to have three because we cannot continue to locate the parking lot inside of the MD dot right away. So I'm going to say this a couple times during the meeting during the uh presentation, but the take-home message here is we uh have a reduced number of parking stalls in the ultimate plan we've arrived at. And what city engineering found in 2023, the reduction in parking stalls is because we can't have parking stalls in the MDOT right away. There's not a reduction of parking stalls because anybody's trying to reduce parking stalls or because the farmers market didn't want parking stalls. It's because we can't locate them in the MDOT right away. So the that 2023 plan is reduced to 100 parking spaces. And uh then we got asked to come in and uh fit the farmers market uh pavilion into that. And if we go to the next slide, um what we found was a much better plan uh in terms of providing the same amount of parking but also providing for the double loaded rows of uh vendor spaces that we were looking for for the farmers market. We simply asked city engineering if we could flip their plan and move that uh third parking aisle closer to the river uh and slide the pavilion a little bit to the north. And it had a number of positive effects. One of them being that uh it actually moves the pavilion would move off of uh being over top of a water man that that bisects the parking lot. So it's sufficient for for infrastructure. Uh and if we move on to the next slide, uh what we were able to restore is the original uh vendor plan where we have two double row

double loaded rows. So we have all of the vendor spaces uh that are underneath the pavilion and then we have the rows of um tents on a 10-ft sidewalk on the south edge. and those numbers. So, we end up with a total of 113 booths, 76 with parking and the remainder without parking. So, um Can you repeat that? Sorry. It's right up there. It's 113 total booths. I got it right here.

76 76 of them have adjacent parking stalls right next to the vendor space.

Oh, got it. And uh the remaining uh I believe it's 36 um I I've had a copy of this right in front of me before and I apologize. Um the remaining 36 uh do not have parking spaces. You might also notice uh as many others who I've given this presentation to have. It's really tightly packed. Um many people have asked, well, how do those trucks get in and out of there? Well, the fact of the matter is that the existing farmers market as we have it today uh has a very tightly choreographed dance of how the vendors load in and load out. The largest trucks have to arrive first early in the morning before the smallest vehicles and they load in and the same way they load out in reverse. And uh unfortunately, if you're lucky enough as a vendor to show up and sell out by midm morning,

the rules of the farmers market require that you stay the entire time. So what the the take-home message here is that yes, it is very tightly packed in order to achieve all 113 vendor spaces that we propose. But the uh farmers market committee and seeds who runs the far farmers market assured us that this is no big deal because they're already running a very tight ship loading in and loading out. Uh they also pointed out that on uh there's a variation in the number of vendor vendors that actually come to the market. uh it's fairly light it's more lightly um attended by vendors in in the spring and midsummer and then becomes much more heavily uh fully loaded uh into the fall when farmers have a lot more produce to bring. So uh also there's differences between Wednesdays and Saturdays. So, it may be that uh we find that on a lot on a lot of Wednesdays, the area underneath the pavilion is fully loaded uh and then they expand uh on Saturdays into the other spaces.

May I ask a question? Sure. What am I looking at there? All those little orange squares, are those uh vendor tents? Yes, ma'am. And then the and there's parking right next to the vendor tents. Yes. And that's for the vendor trucks themselves. That's not public parking. That's correct. When the market So there's there's actually vendor tents still on the bank of the boardman. Yes. A number of uh Well, I wouldn't say on the bank of the Boardman. They're on the the grass area adjacent to it would be a level grass area uh adjacent to the sidewalk uh uh on the south edge of the parking lot.

Yeah. Um and re recognize also that some of those vendors without a parking space um would be renting a space where they would be uh either carting in their wares or uh arriving early, dropping their wares and then parking somewhere else. Again, the original number from 2025 that I presented to you early on is 74 vendor spaces. What this presents is an expandable market that can add an a significant number of additional vendors, but it is significantly greater than the number of vendors that are currently there today. Any more questions right now or shall I wrap it up? I'll try and wrap it up here. Let's go on to the next slide then. Uh these are uh some renderings of the architectural uh design for the farmers market. It's it's about 310 ft long. So, it is quite a long structure. Uh we've um provided for a pedestrian way from uh that would connect to the bridge and um provide a a guiding way across the parking lot into the the pavilion and then uh also there would be uh brick pavers on either end. And so the our our intent is that if the budget will allow as the bids come in, we would have uh brick pavers down the center of the pavilion and then brick pavers connecting it to the south to the um the existing or potentially uh future improved pedestrian bridge over the boardman. There's also a skylight which you can see here uh that provides penetration of light underneath the structure. So, uh, lowering the amount of electricity during the daytime that would be needed to illuminate the area underneath the pavilion and you can get an idea here of the scale of the structure uh, relative to the vehicles,

the vendors and the people. The design of the structure has steel columns with concrete bases and then uh the the the upper elements of the uh roof structure are um laminated and um and wood and then various steel elements that would help with the uh structural um support of the roof itself. So there's a mixture of materials very um very much uh um intended to fit well into the Trevor City uh architectural uh patterns. And then finally, we have one more slide uh to just give folks an idea of the flexibility of this space. In many other communities, these structures are not only used for farmers markets. Uh but if the community so desires, uh you can also provide it for for rentals uh for use or the city itself might choose to make this part of various city events. Uh and this just illustrates that um the lighting that's provided intrins intrinsically within the structure that we've designed for provides a minimum level of parking lot lighting. But if you were going to uh actually use this for events, we have additional electrical outlets built into the design and additional lighting could be uh added to support that.

Go ahead, other um I I noticed there were solar panels on the roof. There are no solar panels on the roof. However, uh the structure can support solar panels if uh that was added at some time later date. That was a request for skylight. No, I thought I saw That's skylight. It's a skylight. Yeah, there was a conversation at the DDA level about Yes. solar. Yeah. And I was gonna say, so that is a question that they're asking at that board, too. So, um, really quickly, I wanted to ask Benjamin to put a little input in with this, too, actually. But first, let me open this up. Are there more questions about the design for Chris? Go ahead, Mitch.

Yeah. So, I've seen this presentation a couple times now, but a question I have is how robust are the steel columns and concrete. Because yes, we trust most people to operate their box trucks in a responsible way, but I can't help but see invariably uh some of them will uh at one point or another ding a column, not just box trucks. Yes, I would u keep in mind that uh this is no more or less uh tight quarters than in the uh various parking decks around town. Okay. So, he's asking about I think the

and as far as robustness of the design uh you know the it meets the uh structural requirements which are actually heavier than downstate uh for the snow loads and various wind loads and the fact that it is very near to the bay. uh the the architect and structural engineers in fact bemoaned to me the uh additional costs that just needed to go into the fact of where the structure is located. Uh with regard to people bumping into it, uh again, it's it's no more resilient or no less resilient than anybody crashing into any other thing. If they bump into it, it's going to chip, but it's not going to take down the whole thing. No, sir.

Good to know. Go ahead, Heather. Um, so the executive summary said that all the parking would be removed along the river, but the schematics are definitely showing parking on the river. I'm sorry, I'm I'm not understanding where you're saying. We get in our packet an executive summary at the top. Let's see, who did this one come from? Uh, from Nicole, removal of parking along the river consistent with the lower bordon unified plan.

Yes. So that is the uh 2023 design. Um and Chris had mentioned that for the circulation they had flipped and uh put the parking back on. So if you look at the design I included from 2023 um it is two rows and then the parking on the north side. So they have flipped that parking on the north side and put it back on the river. It's still three rows of parking from four.

Yeah. It just looks funny because it looks like you've done that but it's not done. Um the executive summary also says that the connection between lots B and T will be severed with the reason being that parking ident that parking is identified as surplus for potential future development.

Yes. So, uh, city commission, I'm get not going to remember the year, um, but, uh, we'll say six years ago, uh, thereabouts, uh, did identify, uh, various city- owned property, um, including even lot G at Modes on State Street, um, as surplus. And so, at that point, they were entertaining, um, ideas for potential redevelopment. And so, lot T is a property that was identified. And so knowing that that could happen and B is parkland, uh the design element was put in to separate those. So if if indeed it was surplused, um whoever was purchasing it would know um that it was separate from lot B and and lot B would not need to be um redesigned on that uh western side.

And just to clarify, that's sort of that list that has like bitner and everything on it. T was identified as on that list as well. But it that's not set in stone, is it? It seems like you're kind of putting the the horse before the cart here. And if I can answer that, um I don't I don't know there's any cart before the horse. The plan has the flexibility. The

um vehicular connection the vehicular connection between uh the two lots is severed. You won't be able to drive a vehicle from the lot on the west into the lot on the east. But uh for the foreseeable future, there's a pedestrian connection uh so that pedestrians can park in that lot and continue to use it and continue to access the farmers market. So I I would pose that it has the flexibility in the plan to uh respond to the stated uh desire to potentially devest that property, but to continue to utilize it and have the flexibility for the market to exist now and in the future under both circumstances. But I see that those two parking lots as really narrowly contained with and without that crossover um and single egress ingress on either side. So you're going to have people trying to get out of lot B and they're going to want to take a left and there's a traffic light right there on CA Chaos in the Parkway. It's going to be a mess. And then on the other side you have people who are going to want to take a left to go south on Union Street. And there's also a traffic light right there. I I see we do we have no plans as far as I know to sell that property and lot T. And so why wouldn't we keep that flow? Why would we close that up? It it just uh constrains everything. Um I also see a lot of work for that lot ti re you know plantings and all kind. What is the plan for that and who's paying for that and when does that happen? Um, you as far as I know, lot B is Parkland. Lot T is not Parkland. That's correct, right? Okay. I I wasn't sure if I heard you correctly. So, uh, I I don't understand why you'd want to

close that off and constrain people even further. One ingress egress for each of those parking lots. Yeah. again. Um I think the direction at the time that we got the uh reconstruction for the lot um was that the then city commission had identified it and we just did not um have or plan to allocate funds to remove any additional parking. So the thought was is that because we were doing a full reconstruct and not just a resurfacing like a millonfill um that we needed the west end of the lot to be as close to what it would be permanently for for another 20 plus years. And so if that's something that you are interested in, we could um potentially look at adding um you know that crossover or removing that piece. But uh again at the time the direction was that there could be surplus. And we were just trying to make it as close to permanent given the cost of uh reconstruction.

Yeah. On non-market day on non-market days it could be open. On market days you you could put some barricades there so you don't have people trying to drive in. But I get what you're saying. The that little lot TNB. I I mean, it could be as simple as a gate. I like that you have that flexibility to drive in or out either way, but that's that's designed that parking lot and I want to go back home, which I live on the east side. I drive through and take Union Street so I can take a right-hand turn. Trying to get a left-hand turn out of Cass is I mean, I'm going to have to drive

to be the right turn lady that I am. I'm gonna have to drive down Cass and then, you know, it's it's a lot. You're adding more driving hours by not having that another I I'm somewhat taken aback by just the level of attack on the plan that we put together uh with the guidance. I'm not attacking. I'm just not I'm hearing that we've done something intentionally to do it.

Well, I just want to maybe step in very politely. I I think that um that the commissioner has the prerogative to express her thoughts and I'm I'm hearing a reaction from her. I don't see it as an attack and I say that respectfully. I wouldn't step in if I felt otherwise. So I think that we just need to be open to that feedback. My question if I could really piggyback that I was about to ask was fundamentally if we decide to keep that open that doesn't change your design and what we have planned for this part of the lot. Correct. I'm certainly glad to revisit the direction we've been previously given in the past and and add in a connection. Okay. Uh connecting these two lot two lots as Miss Shaw suggested. Okay. Good.

Okay. Nicole, um was there an element of parking like metered parking in all of the pavilion spaces for non-market days? That'll be Yes. And I apologize for my squintiness. I lost a contact about a half an hour ago, so really struggle.

Oh, you're okay. Um so yes the the lot itself um is still a part of the auto parking system. So um even on non-market days it will still be ran as a parking lot. Okay. Uh we are doing a study session on March 9th to kind of do an overview of parking and some of the elimination from other projects. Uh but currently anytime that the lot is rented um those uh event per space fees go back to the parking fund. So that is something that we'll talk about too as we talk about the events or um use of the space. Great. Thank you. Do we have more questions about the design?

A quick question. What's the um net impact on parking on those non-market days change? Is there is there loss in parking spaces with this with this design? So we is that is that on the as I said there is uh a reduction in the number of parking spaces from the current lot that we have there today and the loss is entirely due to the fact that we can no longer locate parking stalls in the M dot right away. Okay. Okay. Great. And then the the increase on the vendor stalls is from 74 to 113 and that is the increase in potential capacity. Okay. Got it.

Okay. So, I was trying to let everybody ask design questions first, but I did want to bring up something because I think it gets lost as we have these conversations a little bit is we often talk about because of the nature, how things come to us. This is a project that's being funded by TIFF and DDA for the design and the pavilion and all of that. This is an example though of the DDA and the city working together. And I if Benjamin and maybe Nicole if we get into more than a broad overview. This is happening right now because the city's also going to be doing work there. And so I wanted Benjamin to talk a little bit about the work that's going to be there. Kick that to squinting Nicole. Uh I gave her a heads up that I was going to ask her to do that. Thank you Nicole.

Yeah. So this lot uh will uh include a full reconstruct. So previously when it was put on the CIP it was just for resurfacing. Um so with that we have the opportunity to upgrade the storm water management which will have a ingground infiltration system. Um I do want to clarify in the CIP if you look at the budget uh the parking portion is identified as roughly 650. Uh we did um have uh 400 as the probable estimate from engineering for storm water. So we're hoping to be able to recoup some of those funds. If not then those would fully come out of the parking fund and that was explained in the memo. So um again with the reconstruct we have an opportunity to to um upgrade that storm water system below that that lot.

Thank you Mary tag team through here with three people but we do have in this year's fiscal budget that we have allocated funds in addition to the pavilion for storm water management to to kind of go to that total that Nicole just talked about. And I just wanted to bring that up because again I appreciate that it's been emphasized that the spots we're losing we're losing because of M dot rightway not because of as I've had it put to me for some silly stupid fr fancy park uh farmers market and the fact that this isn't just arbitrarily going to tear up the farmers market one summer just to tear it up that there is actual infrastructure work being done underneath too. So do we have other questions for anybody up there? We've got all three of them now. Okay. What are you thinking about for roofing material? So that's that's a like

I just think about like the long term. If you put shingles on there, you're going to get about 20 years. And are you thinking about like metal roof versus something like longterm more sustainable? Yes. In fact, if we could back up a slide or two, they look like t slate tiles. They are actually uh metal shingles. Nice.

And it's a threecolor pattern. And um if that is um it could also default to uh a more affordable standing seam metal roof. uh recognizing that the city has a budget for this. Uh we're very hopeful that this will fit in the budget when we bid it out, but we're leaving uh the possibility uh that uh it could also be a standing seam metal roof. But the takeaway message is this is a very longterm uh 40 50-y year roof that you get with that. Yeah, I'm definitely thinking along those those plans when we start thinking about the incorporation of like solar panels onto it

because if you put solar panels on top of like shingles, you're going to have to pull the solar pan panels off when you redo the shingles. So, this is whole like more long-term thinking and I I appreciate that. The metal roof can support the um Oh, yeah. I wasn't too worried about the weight of them. more more of the to repair the roof or redo the roof, you have to take the labor and solar panels and the time and so I'm appreciate that

itch. What's the timeline for this assuming that it everything comes back from going out to bid well and you're able to start without weather delays or whatever else for when construction would actually start and when would construction be anticipated to be completed? It's a great question. Um I mean with your input tonight I think city staff will be working on uh essentially a bid package that we hope to get out by the end of the month. Um then once we hear back from those those responses then we'll have a better idea of what that timeline is. Over the last year we've been looking at doing this as a spring project. Um but there's a lot to be seen in terms of that start date but that's our intent

because that's a very heavily used part of town in July. So correct. All right. Other questions? Okay. Thank you everyone for the presentation. And with that, I will actually go ahead and open up for public comment. Any public comment on any items or anything you want. We ask that you state your name and address. Indicate if you're a city resident, non- city resident, and or city business owner. We have a three-minute time aotment per speaker. When your time is elapsed, when your time has elapsed, the timer will beep. And finally, we request that all language be respectful to all parties.

Tim Warner city residents, 608 West 7th Street. Uh back on the topic of the uh the policy for the general fund, uh the part that wasn't included in the packet uh or the presentation, and hopefully you all had a chance to look it up, but in the policy, and this is I'm just reading it for the public's benefit that may be watching, should the unassigned fund balance go above the 20% level, the city commission in conjunction with staff shall develop a plan for utilization of those funds to bring the unassigned fund balance back down to the 20% level. That's what you do. Um there's no reason to wait for an ad hoc till September. Just start the plan for the ad hoc. There's a huge learning curve to study the fund balance. Um Mr. How has already sent you an email uh about all some of the other pots of money that are out there. Um so that that learning curve will take months and you might as well start talking about what your priorities are. Um it's not like you're wasting time. Start talking about priorities with staff uh and get a head start on it. don't wait till September. Um, so you don't have to set the policy aside. You're actually following the policy because it just says work with staff to figure out how you're going to spend the money. And that that's what you should do in my humble opinion. Uh, other topic is uh, TIFF 97. And I would encourage you to think about the big picture um, and what do your neighbors think? like doesn't really I don't really think it matters what city leaders and people in powerful places think. You want what the electorate thinks if you have any hopes of having it approved. Um and then what you're up against is that $2.6 million. That's either value or tax dollars. Like that's $2.6 million every year of value to those city residents. And so you have to have come up with convincing arguments why what the DDA is planning

to do with that money is better than them having some more direct say or going back to them or into their neighborhoods or that sort of thing. U previously the DDA used to use the argument that it was uh what was it infrastructure. It was going to be infrastructure that the general fund would otherwise have to uh take care of. Well, that wasn't in your presentation. Now, now it's just projects. Infrastructure is what you should stick with if you really want the electorate to approve it. Infrastructure because that's where you can say like, well, this has to be done. It has to be paid for so it gets to needs, not wants. It really has to be needs. Identify the needs. If they're really needs, you can convince the electorate to do that. But I don't think you're going to be able to pull it together. It's not you. I don't think the DDA is going to be able to pull it together by November. Uh, and then you also have to think about who's showing up in November. I think there's going to be a huge turnout. And people aren't coming to the polls all happy and giddy about a bright, sunny future. They're pissed off. So, keep that in mind. Fred Bimber, 1223 Randall Street, city resident. Uh the present, just a few brief comments. I'm not going to comment on everything, but the presentation on TIFF 97 said that it does not raise property taxes. That claim is false. It does raise property taxes. The tax re revenue that's diverted by TIFF 97 puts a hole in the city budget that all city taxpayers have to make up through higher property tax rates. And we can see that what I have just said is in fact true when we look at how the

property tax rate is set. It's set at a level that funds both the taxes that reach the city and the amount that's diverted to the DDA. A second observation, the meager amount of property taxes that are that are paid by uh that actually are paid to the city from the tiff 97 district, the taxes on that base taxable value have had no inflation adjustment for nearly 30 years. The true value of that tax revenue to the city, its purchasing power is about half what it was before TIFF 97 began. The TIFF 97 district does not pay its fair share towards common city basic expenses like police, fire, ambulance, parks, and streets. TIFF 97 is in fact a taxpayer subsidy to the downtown. Our downtown more and more is is primarily serving tourists and non-residents. Increasingly, the downtown consists of seasonal home condos and short-term rentals. If TIFF 97 is extended, our tax rates will increase even more. TIFF 97 should expire at the end of its originally scheduled time. Not extending TIFF 97 does not mean the end of TIFFs, but something new should be brought forward that's acceptable to the voters and acceptable to the county and other tax authorities that w will be asked to participate.

Thank you, Fred. Best read 630 63 Kaiser Drive 1B I would love to love to find if there was any other industry than the tourism industry. Unfortunately that's the only industry that we have in Triber city and I don't think that trying to say oh well you know making green run the wheel for the for this is just not an answer. Um, the tourists are going to be here and unless someone else has another industry that they can point to that brings in a lot more money than the tourist, go for it. But I don't see any other one. Um, so on another topic, second topic, um, about the housing. So the charter city, um, housing authority is still currently appointments only. And if people are trying to find housing and um you know, for example, there's a consumer at Norlex Community Mental Health that has tried to contact the housing authority over a couple of things. They have not responded back to them because their office is appointment only and email and calling has not been able to um has not been able to be successful at all to this. Um, so maybe there should be some sort of solution to try to open up the Traverse City Housing Authorities office um for walk-ins instead of just being appointments only. Thank you.

Thank you,

Gary. How 926 Lincoln Street. Um, thank you. Uh, this has been a wonderful discussion around budget tonight. Um, you guys are very deliberative, thoughtful, um, and I appreciate it. So, you probably don't hear that enough, especially at public comment. Um, it was referenced that I sent you an email, which I did, um, because I was on the ad hoc committee to create the fund balance policy. Uh, the reason we did that is we consistently would see when the audit came back that we had a 42 to 45% fund balance um, with no plan of spending it other than some future plans that were unscheduled and unknown. And maybe they would happen, maybe they wouldn't. Um and to reason why we ended up with 15 to 20% is because there's a statemandated 15% emergency fund that's not included in that fund balance. So with 15 to 20% you always effectively have 30 to 35% fund balance. That emergency fund is not untouchable. We just prefer not to touch it. But if you you can touch it if you need it. So um staff can correct me if I'm wrong um afterwards or why they position isn't accurate. But when we the city commission I was on uh saw that as plenty to have a 30 to 35% fund balance including that emergency fund. Um I also just wanted to point out I'm a strong supporter of downtown largely in part because it's the commercial districts that support our neighborhoods and that's not just downtown. There's west, there's east front, there's Garfield, there's 8th Street and 14th Street. Um and for too many years our corridors have underperformed. We've started to see that turn around uh with eight street revitalization. West Front Street uh saw some investments and we've seen some private development afterwards. The DDA was ahead of the game. It was it's a it was ahead of its game in Michigan. It was ahead of its game in the country in many regards. Um I'm not going to voice an opinion on TIFF today. I just want to speak to the power of commercial districts to support my little

neighborhood in Traverse Heights. Um, without it, I'm not getting new anything because my taxes don't pay enough to replace the infrastructure in front of my house. They just don't. Um, and they never will because we don't have the density. We don't have the capacity to do that. Um, in 2017, the city did a study about the taxable value per acre of Trevor City compared to the county. You do the taxable value per acre because it's like miles per gallon. You don't just measure the size of the tank, you measure the efficiency. Um, and Trevor City as a whole is 83 times more efficient than the county. Downtown is five times greater than the rest of the city.

So it isn't just 2% of the land given 13% of the taxable value. It's actually much more efficient. Um, so for me as we move forward, I just hope we keep that in mind that you have to continue to invest in these areas that support all of us. Thank you. Any other public comment for tonight? Okay, seeing none, I'll bring it back. Any final thoughts from the commissioners? All right, thank you all for a very good robust discussion tonight. I hope everybody continues to either be on the mend or stays healthy. And we will see you all next week. Thank you on Tuesday.

Yeah. Thanks. Feeling better? Yes.