City Council - Regular Meeting

Good evening. I'd like to call to order the regular meeting of the city council. It is 6PM. Meeting number three 093. Tonight's invocation is by major Ken Perrin from the Salvation Army Tustin Ranch Corp.

Mayor Lombard, members of city council, city manager, staff, and citizens of Tustin, thank you for the privilege of offering this invocation. Please join me in as we appeal to the lord this for this meeting. Join me in prayer. Gracious and sovereign God, we come before you tonight acknowledging that you are the source of all wisdom, justice, and righteousness. Your word declares in Proverbs two six, for the Lord gives wisdom.

From his mouth comes knowledge and understanding. We begin this meeting by humbly asking that you would give us that wisdom now. Laura's decisions are made that will affect families, businesses, neighborhoods, and future generations in this great city. Grant these leaders discernment. As Solomon prayed in first Kings, give them an understanding heart to judge your people and discern between good and evil. Help them to see clearly and listen carefully and to lead courageously. Where there are complex issues, bring clarity. Where there are competing voices, bring calm. Where there is pressure, bring steadiness. Father, we pray for integrity in every conversation and every vote.

Let justice roll like water and righteousness like an overflowing stream. As the prophet aimless proclaim, may what is decided here tonight contribute to the flourishing of this community and reflect fairness, compassion, and truth. We also lift up the men and women who serve this city every day. Pray for protection over our city workers, public work teams, administrators, and all who labor behind the scenes to keep Tustin functioning smoothly and flourishing. Guard them in their duties and strengthen them in their responsibilities.

We especially pray for our police officers and firefighters. Your word says in Psalm one twenty seven, it reminds us that unless the Lord watches over the city, the watchman stays awake in vain. So we ask you to watch over those who watch over us. Protect them as they respond to emergencies, as they step into uncertain situations, and as they serve with courage and sacrifice. Shield their families from anxiety and surround their homes with your peace.

Lord, bless this city, bless this neighborhood, its schools, its businesses, its houses of worship, and its public spaces. May Tuscan be known as a place where people are safe, where families can thrive, and where neighbors can care for one another. Establish the work of these leaders' hands. As Psalm 90 says, let their labor produce lasting good. As this meeting begins, grant civility and discussions, respect and disagreement, and unity and purpose. May every word spoken here here tonight contribute to the common good. And when this meeting concludes, may those who leave this chamber do so knowing they have served not an agenda, but the people entrusted to their care. We trust this evening to you, and we ask your blessing upon it. In your holy and faithful name, pray. Amen.

Amen. Thank you, major. Councilmember Gallagher has the pledge tonight.

Alright. Please stand if you are able. Face the flag. Hand over your heart. Repeat after me.

I pledge allegiance to the flag of The United States Of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Thank you, council member Gallagher. Next, we have public input. At this time, any member of the public may address the council on matters which are not on this evening's agenda, provided the matters within the subject matter jurisdiction of the city council. If any members of the public who are participating through Zoom wish to address the council, please raise your hand. And if you're calling in, please press 9 to raise your hand. I have Kate Kirsten, the Tustin Public Schools Foundation president, on my list. Kate?

Good evening, mayor Lombard and members of the Tustin City Council. Thank you for allowing us to be here tonight. On behalf of the Tustin Public Schools Foundation, I'm Kate Kirsten, current president, and with me is president-elect Kirsten Antonius. We're here to express our gratitude for your incredible support you've provided this year for our twenty twenty five Dino Dash. It happened back in November, but it was a tremendous success, and your commitment to our cause has had a big impact on our ability to support every school in the Tustin Unified School District.

So this year we were so excited to welcome over 7,500 participants, 600 approximately volunteers, which if you compare that to our humble beginnings where our first DinoDash had about 1,000 participants and a little less than 100 volunteers. We've come a really long way. And we've also been able to fundraise a lot more. This year we raised 4 and $15,000 which goes right back to test in school. Dollars 78,000 went immediately back into the classroom to support our teachers.

And we just spent the last two weeks handing out over $100,000 of teacher and school grants. And that goes right back to all TUSD students. We are so grateful. We know we couldn't have had this success without the partnership of the city, and we are so appreciative of all that you have done for our organization to support the Dino Dash.

So as a token of our appreciation, we have one of our DinoDash sponsor trophies made by a TUSD student as they do all year, and we would love to present it to you. And thank you for your continued support in helping us help the community. Thank you.

We wanna thank both of you, madam president, madam president-elect, for all the work that you're doing for our constituents. We actually keep those trophies in the city manager's office on on a shelf, so we don't just, like, put them away.

We really love them.

So thank you. Don't take

a picture. Oh, yes. We'd love a picture.

We would like to have Manny join us though, one of our board members. Would you come and join us though for a picture too?

Madam city clerk, any other requests to speak?

No, mister mayor.

Thank you. Nobody online? Alright. We'll move on to closed session report, mister city attorney.

Yes. The council took no report of election.

Thank you. Next, we have the consent calendar, items one through 10. All matters listed under the consent calendar are considered to be routine and will be enacted by one motion without discussion. Public input for the consent calendar. If any members of the public who wish to address the council, please submit a request to speak form if you have not already. Any members of the public who are participating through Zoom wish to address the council on items one through 10, please raise your hand. Madam City Clerk, any request to speak on consent?

No, mister mayor.

Do I have I have one request to pull item 10 from council member Schnell. Any other requests?

Yes. What?

Aye.

K. Mister mayor, number seven.

K. I have Nielsen five, think seven, and Chanel 10. Any other questions? Okay. Do I have a motion for the balance?

I'll make a motion.

Second. A motion and a second. Adam, city clerk, roll call, please.

Councilmember Nielsen?

Yes.

Councilmember Murphy?

Aye.

Councilmember Gallagher? Aye. Mayor Pro Tem Chenelle?

Aye.

Mayor Lundberg?

Aye.

Motion passes. Five zero.

Thanks. Can somebody check the heater? It's like it's blasting us up here. We can try to move through this quickly. Otherwise, we're gonna start sweating, and it's gonna be uncomfortable. It might just be blowing. Yeah.

Really, but it it's fine.

You can feel it when you walk

through something.

Not a big deal. Alright. Item number five is a Board of Consultant Services Agreement to r three Consulting Group Inc. Councilmember Nielsen.

Thank you, mister mayor. Mister Grisseau, we could get a couple minutes of your time. I'll get your steps in coming across here. Thank you. So I know you had multiple responses to the RFP for this particular item, and you had a matrix.

So I'm just trying to get an idea on what kind of matrix you used for grading this particular item and why cost wasn't included, if that's a legal issue now.

Yeah, so this effort specifically it's a consultant service agreement. It's a professional based consultant agreement that is geared towards qualification based selection. So typically we release an RFP or request for proposals and we outline in that scope of work the grading criteria that we're looking for. A lot of times that's built out in their response and a lot of that is strength of experience in the realm of the work being requested, local experience supporting other similar sites agencies, technical background, and all of those kind of criterias clearly defined when we release an RFP. And we publish that for open solicitations for consultants.

We typically don't look at price in a consultant services style agreement. That is really kind of reserved for public contract code and construction contracts where low bid is the defining factor. This is all defined in our purchasing policy and our ordinance for securing consultants and contracts. And this is the similar process that we followed here.

Okay. A lot of times, I know I've done work on boards with other agencies where they actually include kind of the matrix, how they actually graded 20% of this, 30% of that, whatever it happens to be in the particular criteria you're looking for for the company you want to pick for this. So I'm sure you had that, right?

We do. I did not we do not have it included in tonight's report, but we can definitely get that. It was published publicly for all participants to see our rating criteria when they propose.

For the original RFP?

Correct.

Happy to

provide a copy.

Okay. Just for future reference, it'd be kind of nice to have ongoing. Okay. That's the only questions I had, Mr. Mayor.

I'll move it. We have a motion and a second. Madam city clerk.

Council member Nielsen.

Yes.

Council member Fink. Aye. Council member Gallagher. Aye. May I approach him Chanel.

Aye.

Mayor Lundberg. Aye. Motion passes five zero.

Thank you. Next, council member Fink pulled item number seven, which is amended listing agreement with Cushman and Wakefield for marketing solicitation negotiation services for approximately 43 acres of city on real property within the Tustin Legacy specific plan. Council member Fink.

Thank you, mayor. I I support this. I so just to, state that upfront. What I wanted to highlight is the next steps as we go forward, and just call out for the public, but also for the rest of the council, as we think about this, a couple of, things that have come up in discussions that I've had with folks in the community. One is and thoughts that I've had.

One is, as we're going through Test and Legacy, we've got a specific plan. But the specific plan I'm not sure if it's serving us brilliantly. I think it's we update it and we we meet the zoning exercise. But I'm not sure that we have a clear vision on how everything should look, how how we want that to be. And I'm not certain that we've got a great way of figuring that out until we see proposals as they come in.

So this agreement is a pre step to the next step, which is listing or putting out a bid. So I think we want to think about that when we go forward. And one thing that has been suggested to me and it may have been suggested to others is that we think about design guidelines or ideas like that as we go forward through the rest of legacy. We've a lot of diversity in how it looks and how it interacts. And maybe we want that.

But I worry as we go forward, and we're going forward quickly, which is good as we go forward. I'm not sure we are pausing to think do we want to get these, how do we want this all to pan out. So as we go forward and then this next step as we think through what that offering is going to look like, I want us to also be on the same track, not delaying anything, on but the same track, trying to think of do we want design guidelines? Obviously have our ongoing communications effort about the hangar and the hangar site helping define that area. But I want us to make sure that we're thinking through how the whole area looks as we go forward.

The second thing is a little bit more off the wall, but it's been suggested to me that when we ultimately do an offering, we may want to open up possibilities for alternative types of development. And one concept that has been promoted is single stairwell building codes. And so that that would allow it would be a deviation from the building code that we might want to entertain in this area if people are interested in doing that, but put out when we do that. And again, all for consideration as we do that. But single stairwell is an exception to our traditional building codes that requires in large complexes two stairwells on the end, which a lot of people think it may be out of date.

Again, not sure it will, but the idea of opening that up, I know as we've had other offerings, we've opened up and we've made it clear to the community we're open to alternative ideas. When I say the community, both obviously residents and the building community, development community. So I'd like to see if we think about making sure that we state that we're open to those ideas. So I just wanted to make these comments in advance because I know that the next steps as we go forward is gonna be that offering ultimately. But I think this is good. They've done a good job. It's good to move this property forward like we have others. And so I'm looking forward to that. With that, I'll move the item and certainly happy to.

Thank you. Further discussion? Motion and a second. No? Council member Gallagher, you can't help yourself.

Go ahead.

I just I I just wanted to in case anyone was watching tonight, I just wanted to highlight one of the items that council member Fink mentioned, and that was sort of that we do have a specific plan and the need to update it and design guidelines and what's the vision for the entire legacy. Just wanna remind everyone that we are spending a significant amount of time and resources to do exactly that. We kicked that off early last year in 2025 with the hiring of JPW who helped facilitate multiple outreach sessions, one on one interviews, talking to any group that would talk to us, culminating in the local reuse reuse authority meeting that was held at the Flight Mess Hall and that was attended by quite a few public members and those interested and that process was just the first phase which was significant on its own but is now carrying through to what is the vision for the Tusson legacy and that will create what the intent is there based on the input, on our planning limitations and constraints and so that process is underway now and will be done later this year as mister Schindler has promised by our next local reuse authority meeting.

Let the minutes reflect that. And so we are moving we're not slowing down, but there is a process that will create a nice visual for the public to see what is the grander vision that incorporates the input today. So I just wanted everyone to be aware of that process that it was going on. I didn't want that to get lost. But I do support everything

you said.

No. And I agree with what you're saying, and I'm glad you mentioned that it helps foster people to engage with that process. Hopefully, these timelines sort of marry up is the key. Further

discussion? City Clerk, roll call, please.

Councilmember Nielsen?

Yes.

Councilmember Fink? Aye. Councilmember Gallagher?

Aye.

Mayor Proton Schnell?

Aye.

Mayor Lumber. Aye. Motion passes five zero.

Thank you. Next, we have item number 10 pulled by Mayor Pro Temp Schnau, which is the ten year cooperative purchase agreement with Axon Enterprise Inc.

Great. Thank you, mister mayor. Appreciate it. I am very, very supportive of of this initiative as well as the other members of the city council. I wanna thank the chief of police as well as lieutenant Nelson and staff for all the hard work that they put into this.

And I'm not gonna read the whole thing, but, we've got a fragmented aging system within our police systems. And this agreement is going to allow us to come into the twenty first century and provide a comprehensive integrated public safety technology platform that modernizes where we are today. It's a big investment, and it's a very important investment in the city, in our public safety, and also in the future of of Tustin. And, again, I'm very, very thankful. And this is going to only enhance help enhance the the public safety of the residents of Tustin. And again, I appreciate everyone's work on this. So with that, I will move the item.

I'll second it. Further discussion?

I'll defer, but I'm happy to speak first if you want.

Council Member Fink, go ahead.

All right.

Thank you, Mayor. I want to echo Council Member Schnell's remarks on this point and also just point out to folks out there, if they're watching, as we procure this technology, it's really important for public safety. But it also helps protect the officers. And it protects the residents and the citizens. And I was with council member Gallagher and the mayor at the real time operations center, and I think the other council members have visited that that the sheriffs operate.

And we saw live feeds cameras in intersections. We saw officers being able to to call for help and and be able to get real time assistance. And so this technology is gonna help that. But I saw as we how at the real time operations center that were able to monitor. And they were monitoring a rally that was going on in Mission Viejo.

And I was looking at that and I'm like, why are we so concerned about that? And the officers explained to me, look, we've got a group of protesters. We've got a couple of counterprotesters on the other side. We want to make sure that we're not interjecting ourselves where we're not needed, but making sure that we're aware of this in case we need to protect the public. And then when we had the No Kings rally here in Tustin in June, I know that the police force here was monitoring that with drones.

And I was there. And nobody had any notion that the police were involved. But everybody was safe and taken care of because of that. And the body cameras that the police officers have, I think we've seen in other places how useful that is to make sure that it's protecting the officers, it's protecting the public, and there's mutual accountability with that. So it's a really helpful technology. So as as folks look at this, understand that it's helping our public safety or it's helping our our law enforcement, and it's helping protect our civil rights as residents and as people that they're working to. So I think it's fantastic. So thank you.

Thank you. Did you? I'll hold my comments. Councilman Nielsen.

Thank you, mister mayor. You know, it it's it's interesting. It's been a long time using different patches patches and different types of systems and having our officers and field officers use the system that they're currently using, taking a lot of time to do it. I think this solves a lot of ills right away. It's been a long time coming.

I know. I know that, Lieutenant Ellison and Chief Toulis, thank you very much for doing this. Definitely definitely well needed. Anything that helps our field officers, anything that helps create a better, safety environment for our residents, I'm all behind. And, this is completely awesome. So question I had when I asked some questions today was, how fast can we get it? And how long is it going to take to install it and implement it? So it was a pretty reasonable time. So I'm very much behind it. And congratulations on getting this done. Thank you very much.

Thank you. And without reiterating what council has already said, we're fully behind Tustin PD and fire, OCFA, and we're glad to be forwarding this. The ten year agreement provides some savings to the city and stability. And so thank you, Chief Lieutenant Nelson, for bringing this to us. We have a motion and a second, Madam City.

Move the item.

We already had that, I think.

Do we have a

motion and second?

Yeah, Madam City Clerk.

Yes, Mr. Mayor. Councilmember Nielsen? Councilmember Fink?

Yeah. Aye.

Councilmember Gallagher?

Aye.

Mayor Templeton Snell?

Aye.

Mayor Lumber?

Aye.

Motion passes five zero.

Thank you. Next, we'll move to regular business. We have one item, item number 11, which is the midyear budget update for fiscal year twenty twenty five, twenty twenty six. We have our director of finance, Jennifer King, to provide a presentation, followed by our consultant, Ira Summer.

Good evening, miss good evening, mister mayor, mayor Pro Tem, and members of city council. I appreciate the opportunity to come before you to talk about the mid year budget for 2526. And so just without further ado, I'll get into it. And just overview of what components will be touched on today. And first of all, I want to share some good news just based on how we have been doing for the past six months and going moving into the next year.

And we are guided by a long term fiscal sustainability strategy as a ten year plan that we first presented to council and last June, and that will guide us in what we are doing, how we plan for the future. And along a part of the plan is how do we how are we doing with pension funding? And so we have a pension pay down strategy presenting to you tonight. And we are also have our consultant Ira Summer from Truecom in the here to talk more in details. And the next topic we're gonna touch on, we're gonna touch on the general fund and the land sale proceeds budget options.

And those are the options for the council to consider moving forward. And we'll talk a little more on the capital improvement program for the coming year. With that, I will jump right into the good news section. And because this section really provides a broad context on the numbers that we'll be talking tonight. So the first piece of good news and our operating budget, the recurring budget is balanced for right now as projected.

And if you might remember back in last June, we the operating budget had a projection had a deficit, and we proposed to ask counsel to allow us to use some land sale proceeds to boost up the reserve level. And so right now, six months into the year, we're looking at the number again, we're projecting a balance recurring operating budget for twenty five six. And in relation to so along the same line, the city has also pushed out a number of competitive offerings of city owned properties. And one of the items that touch on earlier today, item number seven is probably related to this. So altogether over 100 acres of property have been authorized by the council for competitive offers.

And all those are expected to generate significant one time revenues as well as recurring revenues in terms of sales tax and property tax and other permit fees. And last December, the city closed a land transaction in Tustin Legacy, which generated approximately $42,000,000 in land sale proceeds. And on top of that, we also receive number of about $9,000,000 of backbone impact fee. And that will help funding the legacy's ongoing infrastructure development. And the transaction is projected to add about over 1,300 new housing apartment units to the local housing supply.

And we are moving along in our current UAL funding plan, which the current five year plan is ending this year in 2526. But we are projecting we are in a place to pay off in about six years and more details to come. And lastly, a lot of major CIPs are happening around town. And you can see in front of City Civic Center and Old Town and Main Street are underway. And the Civic Center generator, emergency generators also happen on-site.

So a lot of good things are happening right now. So going into the long term fiscal plan, and this is our guiding principle when we project out, when we plan for activities, when we project out for this year and the coming year. And we talked a little bit about ongoing general fund revenues, increasing those recurring revenues and that those are the funding source to support our recurring municipal services. And we are also looking for ways to decrease ongoing general fund expenses by addressing UAL pay down and also look for ways to be more efficient in terms of how we carry out municipal services. We're looking at, projecting onetime revenues and also use those onetime revenues strategically to minimize any interruptions to the general funds service delivery.

I mentioned a couple of times about operating results. So we do a projection of the operating results for the next fifteen years. And this is really looking at just recurring items without any one time or non recurring items. I call it above the line items. So the blue line here represents how we projected last June.

And the orange line represents how we are projecting the numbers to be as of last month. And you can see the numbers we are looking at the orange numbers are performing better than the blue line at certain point. And this is really basing on how things are recurring events are happening, which will impact the recurring revenues and recurring expenditures. But in general, we are in a better place in terms of projecting operating results. We talk a little developments to come and and competitive offers out there.

And this slide recaps the properties that have been authorized by the city council to go out for competitive competitive offers. And there are a number of things going here, and we are also projecting at what point we're going to see the land sale revenues to come in to city's coffer. Now we turn into pension pay down plans. And the council in last June directed staff to look at what can we do in terms of funding UAL going forward. Our five year plan is coming to an end, and we're looking to see other options.

Can we still going at the same pace or can we look at something different? And this is where so to conduct that study, we engaged TRUCOM. And I'll let Ira to talk more about his expertise and his firm's expertise. And the mayor also appointed at ad hoc formed by mayor pro tem mayor pro tem Chanel and council member Nelson. And a lot of funding options were reviewed. And ad hoc committee provided feedback on those funding options. Staff made recommendations on the funding options. So with that, I would like to turn it over to Ira to go through the details. Thank you.

All right. Thank you. A little bit about me and and the company that I work with, TrueComp. TrueComp actually got started about December ago as as GovInvest. It it was, our founders, sort of found a need to, create a software vehicle to be able to more dynamically explore unfunded liability on pension areas.

For most government agencies, especially in California, you're all in CalPERS. CalPERS gives you a report once a year. The report comes out, about fourteen months after the end of the fiscal year, and there's sort of a time lag before you end up paying things. And in that time, things happen, sometimes good, sometimes bad. And you wanna make decisions about how you pay things off.

So our we created software that helped helps agencies quickly and easily figure out the impact of those decisions as you're funding them. I joined the company about ten years ago. My background, for for over forty years now, I've been advising government agencies on pension health care labor issues. Issues. Was consulting actuary for a long time.

I actually spent a couple years as the auditing actuary for CalPERS, so I know way more about this than any person should. I tried to get away. After thirty years, I got released for good behavior, went off, thought I would just teach finance and economics to MBAs. The thing is once you start working in the finance area of the public sector, they never let you leave. So I'm back and working with agencies and getting a chance to work with cities like Tustin to help you solve these problems and understand what's out there right now because the the world's crazy. The economy is crazy. Things go up and down. There have been points where you've been things have been steady. You don't need to do much. These are not those times.

The good news is, you all started taking action a few years ago to be able to better control your unfunded liability. What this I did that. Okay. Good. There's a lot of power here pushing these buttons. What this graph represents is something you you probably saw, a few months ago when you were talking about this. It represents your, your current approach to dealing with unfunded liability. The the baseline cost for CalPERS come in two pieces. There's a normal cost piece. That's the actuarial term for the cost of each year of service as it's earned.

And that cost is gonna continue across time. It's relatively steady. It grows relatively slowly. The purple over here represents the the payments towards unfunded liabilities. So to the extent that your city is behind target on funding and by the way, 99% of the agencies in California are behind target on funding, and it's not because of anything that you necessarily did.

The main reasons unfunded liabilities appear for these agencies, biggest reason by far is over the last twenty five years, CalPERS has made their actuarial assumptions more conservative, assuming people are gonna live longer, which is really annoying. And also recognizing the fact that the some of the the investments are not gonna do as well. Back when I started working in this area, back in the early eighties, bonds were earning $10.12 percent, and you could easily earn 9% of your portfolio without trying very hard. Across time though, interest rates have come down. CalPERS has had to diversify, get more aggressive in their investing.

It's created a lot more volatility and lower expectations. The assumed rate of return right now for CalPERS is 6.8%. So way down from its peak of 8.75 than it was in the in the nineties. Lowering that, less money from investment return meant more money required from you created unfunded liabilities. The you've done you've addressed that across time by putting extra money away, some of it directly to CalPERS.

So the the light blue map bars over here are extra money that you paid directly to CalPERS to pay off the unfunded liability. Liability. And it's helped get you to a place where things are doing better. That combined with the strong investment returns in the last few years has shortened the remaining unfunded liability period as as was mentioned before. If things go as expected, if CalPERS at least hits their 6.8% target each year moving forward, you're expected to pay off your unfunded liability in 2032.

The other thing you've done, the dark green here, shows money you put into a section one fifteen pension trust, which is basically a rainy day fund. And money that goes into that trust under California law has to be used to pay off pension costs. Now the good news about that is under your control rather than under CalPERS right now. It's relatively conservatively invested, and you get to decide when you move it over, whether you're gonna use it to make regular payments because something happens and you need the extra money for your general fund, or what what we assume is being used for right now is to pay off your unfunded liability early. So the money's accumulating.

What we assumed for our projections was that when that money was enough with the money that's in there already to get you to a 100% funded, you're gonna shift the money over, and it's gonna pay off the unfunded liability. Liability. And when you pay off your unfunded liability, you contribute the purple over here, payments go away. And that's why it drops down just to the green, the unfunded liability. So this is what you're doing right now.

You are scheduled to make an additional one more additional set of payments of approximately 2,000,000 to CalPERS and 2,000,000 to the one fifteen trust this year. That's what you've done for the last four years. This is the end of your five year plan that does this. So the question that I was asked to address is what do you do moving forward? Is this enough? Should you put more in? If you put more in, should you do it faster, slower, in pieces altogether? We looked at and and there are an infinite number of possibilities here. And people wanna leave before midnight. So we narrowed it down to five that we're gonna talk about today.

First one is what I call slow and steady to CalPERS, which is continuing what you're doing, putting 4,000,000 away each year, but doing it directly to CalPERS until you get to a place where so it's enough for the next few years to get you to a 100% funded and then pay everything off right away. So it's extra money for a few more years. That's the first one. What this table represents and I'll I'll explain actually, I'll explain the five different approaches, then I'll go through the table. The second one is assuming you're doing something similar to what you're doing now, which is still 4,000,000 a year, but 2,000,000 to CalPERS and 2,000,000 to the section one fifteen trust, the rainy day fund, and then moving things over.

The third approach we looked at was saying, okay, you've got a whole lot of money in in some reserves. What if we just pay off the whole unfunded liability right now? Fourth option was paying two $5,000,000 extra pair $5,000,000 to CalPERS, $5,000,000 to the one fifteen trust in two pieces rather than four of $2,000,000 each. And then the last one that we just added is what if we stop making additional payments for a little while. And then in 2030, when you get closer to paying everything off, make one big payment at the end, which is not as big as the payment you would need to be making if you made it this year.

So instead of making a $40,000,000 payment, you make about a $14,000,000 payment and pay off the rest of the unfunded liability at that point. So what this table represents is the the cost and the net savings coming out of this. First row represents a normal cost. Remember the cost for each year of service, that's continuing for everybody. You'll notice all the numbers are exactly the same because no matter what happens, you have to pay the normal cost.

The second row are unfunded liability payments. So to the extent you have an unfunded liability, CalPERS creates a schedule. They tell you what you're supposed to pay. That is not optional. There is a minimum required payment. You have to make those payments at any point in time. To the extent you pay off faster, those payments no longer need to be made. So when you make extra payments to CalPERS, they start shutting down some of the amortization basis because you paid them off sooner and lower those payments across time. The third row shows the extra money you're paying. The fourth directly to CalPERS.

Fourth row shows the extra money you're putting into the one fifteen trust. We added them all together, and then we look to see what the comparison was. The other thing the other row that we have is we have a row that shows you have your one fifteen trust. There's gonna be extra money left over in some of these cases. And so we wanna net those out.

In all of these situations, the city ends out being in a better situation. You say you you basically get your money back that you contributed plus more under each of these options. But I wanna do a few caveats before you go counting your money in your savings. First of all, this assumes that the one fifteen trust and CalPERS hit their assumed rate of return each year moving forward. Now if they do better, you're gonna do better.

If they do worse, it may go away. Right now, my personal belief is that, we're seeing the economy slow down, but we're still seeing the markets move high. I think that means that there is a a definite risk that at some point, the markets are better gonna better reflect what's happening in the economy, and we're gonna see the markets correct and move down. If you hand CalPERS $10,000,000 and the next day the market drops 10%, it's cost you $10,000,000, but CalPERS only really got 9,000,000 out of it because they lost 10% of it. And you still have to make those extra payments to make up for So in a an environment like this, it is it's helpful to be cautious whether you end up giving it to them in pieces or hold off and potentially put it into your section one fifteen trust.

The section one fifteen trust, you control the investments, you are invested relatively conservatively. So your returns on the one fifteen trust are better than your returns on internal reserves, but not much more. Over the long term, I would expect the returns in CalPERS to be better than any of them. But in the short term, the returns in CalPERS are gonna be a lot more volatile. So there's a lot of risk involved in doing this, and that may be a reason to hold off.

The yeah. And and the other thing that happens again, one, you give money directly to CalPERS, they readjust your payment schedule, and you then have another fixed schedule moving forward. If things happen to the economy out of your control or if things happen within the city of Tustin where you have to make big payments out of the general fund, you still have to make those payments to CalPERS at any point in time. So there's not as much flexibility if you give all the money at once to CalPERS even though there's the most savings that way over the long term. So I'm try I've I've tried to make it easy, and then I told you that life is not simple.

So there are a lot of complications of this. Overall and and I get asked often, what would I do? And part of that problem with that question is I understand I see the pension. I understand the pension. If I were to pretend that the only reason the city exists is to pay pension, then the answer's easy.

But you have a lot of other things going on. And those are things I don't get a chance to see. So, the good news is right now, you're in relatively solid shape. Again, if things go as expected, most agencies within CalPERS, when I talk to them, they're not expected to pay off their unfunded liability till closer to 2040, and you're looking to pay it off in 2032. So you're in a position where you can you you've done a pretty good job.

If you've got other things that are important to do, hold off for a little while. Wait to see if the economy ever gets less crazy, and then at that point, try and address the unfunded liability. This isn't a, I have to do it now and I never get the chance to do it again. And every every year or two, you can take a look at this, see where things are going. If anything, you know, I'm a big fan of big reserves and rainy day funds and being able to have money there both for your pension issues and your other issues. Questions?

Maybe just for the benefit of these options what's the recommendation from the UAL and I guess your recommendation?

So

if I may jump back one slide. So this slide represents staff's recommendation, which was also review with the EPCO, what staff is recommending is to hold the baseline and finish the prepayment this year. And then we'll hold the baseline and coming before you, we just for the next several years, we'll be making the regular required UAL payment. And so we can get away from that. But we'll hold the baseline and come back to you, review every time we do a budget review, mid year budget presentation or budget adoption.

We'll come back and look at the UAL status. And if we have any opportunity to pre fund more to save more. And that recaps the recommendation I have on this slide. And the baseline, it's it give us more flexibility And it allows us to be more agile when the market fluctuates. The market will fluctuate.

So this is the UAL piece. And then I can move on to other budget items if the mayor decides. Okay. So let me move on to other budget items.

Can I run away or should I stay here?

If you don't mind staying, that would Thank be you. Now we're talking more numbers. Operating budget for the general fund. And we also pull in the land sale proceeds fund because there is a funding flow between the two funds when we came before you last June. So we want to bring back that option to present you both funds and show them at the same time.

So on this slide, what you are seeing is the general funds adopted budget for 2526. And also the land sale proceeds adopted budget for 2526. And with the media review, we are presenting two budget options for the city to to for council to consider. The only difference between option one and option two is this yellow highlighted line here. So before I get to that, the yellow line, I would like to just address results and how we have changed from a deficit to slight surplus.

And that's brings back to earlier slide, the general fund is balanced when we projecting out for twenty five, twenty six year on operating result basis. So for the general fund, we'll have more details on each on the operating revenues and expenditures in the next two slides. But the revenue is projecting to increase by about $3,700,000 and the expenditure is projecting to decrease by just about $500,000 So that brings the operating results to about $600,000 of surplus. And then after the operating results, we're layering on all the nonrecurring items on both the revenue side as well as expense side. And the council had providing direction in last June to maintain a 20% reserve level in the general fund.

So with the new operating results, we are looking at if we don't we don't request the strategic use of land sale proceeds in the adopted budget, we will still achieve a reserve level at above 20%. So that's why staff is recommending budget option two to not use the land sales proceeds because it's not necessary at this time. And if I can jumping into just a little more detail on revenue section. And again, those auto numbers are in millions. And you can see the largest increase is from revenue.

So those are sales tax is doing great. We are projecting at least a 3% increase. And also departmental revenue is permit revenue from development, our legacy. So in total, the operating revenue is increasing, projecting to increase by $3,700,000 and together with the decrease in transferring in from land sale proceeds. So we are looking at just under $100,000,000 of revenue in the general fund.

This is a look at the expenditure level by department. And the operating expenditure is expected to be $500,000 less than the adopted budget. And I would like to point out that in the agenda report, there is a section that discuss a pilot testing community support grant program. And that line item is budgeted under non departmental for $55,000 $50,000 for the grant and $5,000 for the administrative fees for the grant program. And that's budgeted under the non departmental level.

And with that, we are still seeing a decrease on the recurring expenditure. And we are seeing so we're projecting in total, the general fund will have $109,000,000 of expenditure. So the recommendation for the general funds budget is to proceed with budget option two, where we will not we'll forego the transfer from proceeds to boost up the reserve level. So the next section, just one more section, the CIP for mid year adjustments. So I'll go quickly through this one.

And on the overall just on a very high level, adopted CIP was $58,000,000 as certified projects and amended CIP is $67,000,000 and 42 projects. This is the time this is it doesn't mean that we open up seven new projects. It just this is the time that we true up any carryover CIP budgets for projects that started in the previous fiscal year, haven't been finished. And this is the time that we true up those carryovers. And there are a few smaller projects.

That's new requests for the fiscal year during mid year. So this slide recaps those smaller projects. And some of them have to do with building maintenance at various locations. And some of them are park related. And then some have to do with South Hangar's ongoing infrastructure, lighting, and site security in the items.

And along with the new requests and Director Grisso's team also received some grants to do some street related projects and plans. And those are also being added at mid year. And so the recommendation for CIP is to approve the carryovers and any new requests that's being listed in the slide as well as in the general report. That concludes my presentation. I'm happy to answer any questions.

All right. Thank you. Do we

have questions before I open public input?

Yes, Mr. Mayor. Just a couple

of Councilmember Nielsen?

I just want to clarify something for the option two situation that you discussed. It's a 24% reserve with that option, correct?

Yes. That's And

the grant funding, that's the community grant funding?

Yes. That is the grant program that will that staff recommends to be administered by a testing community foundation. Yes.

Okay. That's all I

have. Councilmember Gallagher and then

On the projection for future years on you had the two lines the blue and the orange I think you just said that was recurring.

Yes that is

Recurring revenue, right?

Sorry, let me go back one more. Yes, this is projecting recurring revenue and recurring the net recurring operating results.

Right. So this includes this is the net between the revenue and the expenses. When you say it's just operating, so there's no capital improvement projects included here? This is just staff and sort of okay.

Yes. Alright. Thank you.

Council Member Fink.

Thank you, mayor. I just I wanted to ask a couple of questions about the community grant program, and I see Frank Reynolds in the audience from the TES Community Foundation. Glad we're doing this. But a couple of questions. Just in terms of the grant requirements and guidelines. And I don't know if these are are these existing TCF grant guidelines? Or are these a new set of guidelines that will be developed specifically for these dollars?

If you don't mind if I may direct the question to assistant city manager Bernard.

Yes.

Thank you. Thank you. These will be new guidelines that are created in collaboration between city staff, council, and TCF.

Okay. And you said city staff, TCF, and you had council in there. Yes. Are these gonna come back to us to review before we

No.

We'll we'll handle them at the admin level in in consultation through briefings. They'll be mirrored very similar to prior guidelines that the city and TCF have used in the past.

And And I think that makes sense. I'd like I'd like to see and look. And I think as a realistic matter with the pilot project using sort of some grants that have come out in the past. I know there was a bunch during the COVID period. Yes. And I know I served on on the board for a short Frank and I had a short time overlap on the TCF board working those out, figuring out what those are. But I'd like to see those ultimately come back and, you know, I assume we'll probably have them in place before the budget cycle in June because some of them are gonna be for this fiscal year. I don't know if they're gonna get out in time. But I'd love to I'd like to see those come back so that we can see those. And then on the back end of that, this year for this year's money and next year's money.

Love to see what the actual dollars were so that we know when we're looking at this program, I guess, for '20 whether to continue it through 2728, to see how those guidelines worked, what resulted in that, and see what adjustments are going to be made. Those are just sort of the back end

If I may offer a little bit of clarification, in the resolution that is proposed for council consideration tonight, there's an overall framework that is provided that the guidelines would fall within.

Yeah. It's pretty broad. They are. I mean, it's really broad.

Intended to follow best practices and best practices between the two agencies. But the timeline that we were looking at is more ambitious than what you just described. We had hoped

Is that in the resolution, too?

The timeline is not. That was something floating between staff and counsel and briefings is the idea of the application period for this funding to be administered by TCF starting as early as March with the idea that the awards could be notified, selected, funded, and then recognized in April. So then in June, when we come back, we would already be able to report out on the pilot program and the pilot guidelines that we used and consider if any adjustments needed to occur at that point going forward.

Thank you. That's even better than what I was suggesting we wanted to do. I think it's good just to see have to work this out. And the concepts and the goals in there are good. It's just they're very broad. There's going to be more detail and how much we muck around. We probably don't want to do too much. But I think we want to see that, and we need to make sure the public sees that too.

We were hoping we could evolve it based on performance and feedback.

Terrific. Thank you.

Excellent. Thank you.

Mayor, I have a question for the city attorney. Yes. Do I need to not vote on this? No. Not TCF, no.

Would you like to take

a recess to discuss this?

Yes.

Okay.

We're gonna take a two minute recess, hopefully, and get back to this.

Kang, thank you very much for the presentation. You have to come back up. Just to bookend this conversation, just just say it is great news. You know, we're a city that is very judicious in the way that we spend the taxpayers' treasure and money. I mean, the city council, previous city councils and staff, I think, have done an exceptional job of of really, you know, watching every dollar and spending it as, efficiently and effectively as we can.

It's great news. We've got a 114 acres total. I mean, the Tustin legacy is a tremendous economic engine for the city of Tustin and allows to do all the great things that we're doing like fixed parks, you know, have the police department be able to upgrade their their systems to ensure that citizens and the police are are safe. We've got a balanced budget. I mean, that's a great thing. You don't hear that too often in city government, federal government, and state government. And we're in a pretty good spot with our pension. So hats off to our financial group, Director King, to staff, to the city council members that sit here today, and those that came before us. We are very fortunate in the city of Tustin to be in the financial position that we're in. So, again, thank you.

Thank you. I do need to take public input. We need to take public input, so I'm gonna open portion of the, item. If any members of public wish to address the council, please submit a request to speak form. And if you're participating through Zoom, please raise your hand. Madam city clerk, can you request to speak?

No, mister mayor. Anybody in the audience? Alright. We'll bring

it back to council for discussion. I want to say a couple of

things real quick. Can we

go to one slide previous, slide six, I think? Alright. Thank you. I agree with these objectives, and I just wanted to, put that on the record that our goal up here as a council has been and will continue to be to increase revenues, decrease, expenses. Item three is a little bit nuanced. We are trying to move away from the safety net of one time revenues as a stop gap. And we're trying to make an operational budget that is secure moving forward without proceeds. And I just wanted to say that out loud. We are very fortunate to have property in the legacy. We're moving quickly and selling things and investing and able to pay down our unfunded pension liability.

But eventually, with that, well, we'll run dry. And so one and two, great. Three, probably will not be as big of a tool in budgeting as we move forward in years. And I know staff is aligned with that, but

I just wanted

to say that for anybody that's watching. And then on the the TCF grant thing, it's it's $50,000 and a $106,000,000 budget. I wanna just say, I think this the impetus of this item was and staff, thank you for putting something together, pilot program that we're gonna test and adjust if it does or does not work, was an an issue that we had not currently, but in the past. And council had asked staff to put together a standardized process and system for considering grant funding from city coffers because what we were running into before was one off requests from council members or community groups, and we didn't know how handle them. So thank you, Nicole, for taking spearheading this, and thank you for putting in this budget.

Let's see if it works. I'm supportive of it, and let's see if it works. And if it doesn't, we can reassess next year. So those are my comments. Any further comments? Council member Gallagher?

I'm also supportive of recommendations and supportive of option two. I I did wanna make a couple of of comments though. I you you highlighted three. I thought you were gonna comment on on c there, operations and programs. This is the one time revenues really that using it for item c operations and programs is definitely something we need to avoid.

I think I like how Councilmember Snell, I'm sorry Mayor Pro Temps Snell sort of started this out and just that this is all positive and so I don't want my comments to seem like I'm focusing on the negative but I do think this is an area that we have improved and we need to continue to improve because we continue to have since I've been on council a very similar conversation where we're moving money from the land sale proceeds in to pay for these one time items or as C mentions operations and programs. And what we continue to push for and we're getting closer but we're not there is we need to understand the full economic picture and that's the Tustin legacy and we've got some tools now that are helping there. But I think if we can for once and all kind of lay that out, I think it'll really frame these discussions a lot better and I brought up the question about the surplus deficit graph which I think is great because we're starting to look at how we're projecting and how that's changing over time but I do think what's missing from this is looking at CIPs and you saw that's a significant portion of the budget and I know there's some items out there that are coming.

We've got the parking structure in Old Town, we have significant improvements we have to do at streets, we have other all these capital projects that have a big fiscal impact and I think if we are a well oiled machine, 24% in our reserves that's a strategy because we know a big capital project is coming, want to build up our reserves so that we can draw them down so that we can hit that project and I just don't think we're at that level of complexity yet and I think we need to get there and if we can kind of keep pecking away at that so that when we're up here during budget discussions, we're looking at those long term projections and we're looking at a full picture. I just think it'll be a lot more beneficial. And then I just wanted to add one more comment. And the recommendation does say that we are gonna come back annually and look at this UAL and I think that's really important because I I trust your forty years experience, I trust the ad hoc committee, but what makes me really nervous about this when you say it's it's nice to have money in a rainy day fund and reserves.

I totally agree with you if this entire group was going to be in control in the future. I don't know who's going to be up here, I don't know who's going be in your seat and I my role as a fiduciary is to protect the rate payer and I think if I know we've got this money I want to lock it up in a 115 trust And if you tell me I can make more on that than it's sitting in land sales proceeds, even better. So to me this I'm scared of the market to me seems like sticking money under the mattress and that's great. We avoid all market risk but we also we also miss the upside. And we also create a cash pile that for future groups could be used for other things that may not have a long term financial benefit to the community.

So I just I just wanted to say we're going look forward to bringing this back talking about it when we have some more market clarity, we have some of these land sale proceeds coming in as you outlined the 100 acres and so I support the recommendation but just wanted to add that flavor.

Yeah. Councilmember Nielsen.

So first of all, I'd like to thank the everybody in the finance department that did this Herculean effort and and put all this together. I mean, this is a lot of work. And the consultant, thank you very much for doing that. I I know. A couple of things. When I was on the council the first time, we came up with a reserve policy because there wasn't any. We were starting to chip down into single digits. And had we had a recession during those first few years, it would have been bad. We were coming out of one, and it was tough. So but we made the determination to do that because, you know, once the market dips, it gets it gets a little ugly.

You know, sales tax drops, tax revenues drop. It just it can be very, very rough. So in this particular market, you know, it's it's hard to predict. You know? There is a lot of predictions that it's gonna drop.

It's gonna correct. So we wanna protect ourselves. Does that mean that, creates a situation where we don't have flexibility? And I think the great thing about this is that we've created flexibility in our financial structures that we can do different things and look to take advantage of those opportunities. As far as the community grants, the original TCF was reinvigorated because, the city was getting bombarded with requests for money from all sorts of nonprofits originally, and TCF was created in order to take those particular requests and fund them.

The city, I think, gave them some seed money originally to do that, and they were going to be separate, and they were going to be have fundraisers in order to to fund those particular requests so that the city wouldn't have to do that. So we're kinda coming full circle a little bit. So I'm not gonna I'm not gonna hold this up by by voting against it, but, you know, I'll be definitely be putting a real, real sharp eye on this particular pilot program. That's all I have, mister mayor. Thank

you. Thank

you, mayor. I appreciate council member Neilson's perspective on that and seeing where we're you know, where we were in the past. I also wanted to sort of key off a couple of things both the the mayor and council member Gallagher said about utilization of one time revenues to fund, and you specifically called that c. And I agree with you, operations and program. And and this is why I agree with all of the recommendations here, and I think it's important.

I I've been concerned about how we're spending how how we're reserving our UAL fund, how we're paying down CalPERS. And I think, you know, we've done a five year program. We've paid it down. We've gotten into a better situation than most cities, and I think we're in the right spot to to adjust that. But I worry about some of the things that you just said, council member Gallagher, about what happens to that money. And if you go back Jennifer's not up there, so don't get up. But there's a chart there, and folks saw it. It had 2,000,000 in dark green and 2,000,000 in light green. Right? And that's $4,000,000 And I think there's a fear, a concern, let's say.

I won't overstate it. But concern that people will see that and say, hey. We got $4,000,000 to spend. Let's spend it on ongoing operating expenses. Let's keep spending it. And I'm concerned about that. Ira, I'm sorry, I forget Ira's last name. But our consultant was talking about we need to come and revisit this because if things go in the market we might need to once again change course. Which leads me to think we really ought to be putting that $4,000,000 into a place where we're doing something better with the money than we have been in the past. And that's where I think we ought to be putting it into some sort of community reinvestment fund of something where we're using the money.

Somebody told me when I first discussed this UAL pay down years ago about the city that it's one of the better investments to make to pay down our debt because it's a high interest rate. So it's good to it's good to do that unless you can come up with a better use of funds. And I think there are better uses of funds and and that's what that we could do. That's not on a programmatic operating basis, but our one as I I would say I would suggest that we put that aside in a way that invests in the community in ways that we haven't in the past. It's going to be short term, one term projects that might have returned.

So examples of that. We could we could deal with a blight in in near Old Town and use some of those funds to buy the Bel Air motel. If you write off of Pepper Tree Park, which we have a lot of our police officers here, including Serge, who knows that that is a draw for our unhoused population right off one of our most popular parks. Talked to Aldo, who talks about the old days about when we had redevelopment, redevelopment agencies, and there were funds that were able available to to put into local redevelopment efforts with low cost loans and businesses. And we have seen in Old Town over the last year despite really strong efforts, and I give our our a lot of our city staff credit for this with the Saturday farmers market and a beer garden, but we've seen closure of a couple of landmark restaurants, you know, buildings more and more vacant.

If we could use those funds one time that we put aside while we're, as I think what Ira said, while we're waiting to see if there's something else that happens. And we use that short term in ways that would come back to us, whether in the form of loans and ultimately in revenue and economic growth. And the third idea that comes from that is investing in the South Hangar and engaging in a better and a strong marketing campaign to bring back uses to the hangar, whether it be return to more filmed uses of that or Pete Beatty's not here tonight, but I think everybody about a either it's a flag day or anniversary or maybe a fourth of July event at the hangar. I know I talked briefly to council member Snell a few weeks ago about Olympics viewing in 2028. But some but putting that money aside, earmarking that $4,000,000 that we have been in the past putting aside for either a trust or a pay to purse and saying, 're gonna take these dollars specifically and reinvest them.

And as we come back and report every year, if we can continue to use that in a way that's going to create long term better growth for our budget, our economy, meet those two objectives, increasing ongoing general fund revenues, and protect that against using this for operations funding, I think that'd be really important. So I agree with all the recommendations here, but outstanding question is What do we do with that money that we freed up? I think as we said here, we know it's not necessarily money that's freed up. A lot of this is fungible. But I think if we earmark that and put that in a specified fund for these types of projects, and I'd like to see staff come back with that, you know, proposal to to flesh that out for the June budget, we'd actually be able to tell the public we're protecting it in the way that council member Gallagher suggesting, and we're using it in a better, stronger way for our local economic development and growth.

So that's my suggestion. I I don't know. You know, I guess I'd put that in the form of a motion to add that to to to the recommendations to have staff come back with the budget with a a program like that. And so I'd I'd open it up to see if anybody else wants to speak to that.

Mayor Burton. Alright.

Thank you. I just want to reference a comment that council member Gallagher made. So I definitely agree that we should bifurcate the land proceeds sales from the continuing operations. And when the ad hoc met to talk about those $4,000,000 in payments, we didn't have the updated numbers. So we were making a decision under the assumption that we're going to have a structural deficit in our operating budget.

And I think it's really important that the operating budget, like the mayor said, can fund itself. Right? That we have enough money to run the the day to day operations without dipping into the land proceed sales and borrow from Peter to pay Paul. So I agree the financial models are flexible and that we should revisit it. But at the time we made the decision, if you take a look at staying the course versus continuing to contribute the $4,000,000 in the one hundred fifteen trust and the pension pay down, I think the net savings is about $1,000,000 So operating under the assumption, again, that we were going to have a structural deficit with our operating budget, we thought it would be better to take those $4 and then be able to leverage those to balance that budget.

So again, I think as we go forward, we take a look at it, and then we can always revisit the decision and make changes on a go forward basis. Thank you.

A little bit of perspective. I'm going to add from my own perspective, this is the mid year budget adjustment and we do have a budget process forthcoming. And I think a lot of these good ideas should be entertained as we engage in forward looking budgeting. I'm gonna move staff recommendation and I'll accept a second. Any further discussion?

Okay. Madam city clerk, roll call, please. Councilmember Nielsen? Yes. Councilmember Pink?

Aye.

Councilmember Gallagher?

Aye.

Mayor Pro Tem Chenelle?

Aye.

Mayor Lundberg?

Aye.

Motion passes, five zero.

Thank you to staff and our consultants for all the hard work you've put in and the ad hoc and the past council for putting this policy in place to begin with. Thank you. Yeah. Next, we have, other business. Mister city manager, do you have a report tonight?

Thank you, mayor. An item to share. Our Main Street and Old Town improvements are reaching a milestone and nearing completion of storm drain improvements on both Main Street and El Camino Real while also preparing for the start of parklet construction in early March. To execute the parklet construction, the contractor is coordinating extended lane closures on El Camino Real in two phases. Staff are in constant communication with the local businesses and information is being disseminated through social media, our website, and on-site project signage. We'll continue to update the community and the council on the progress of that project. That's what I have tonight.

Thank you, sir. Mr. City Attorney, do you

have a report? Evening.

I'll bring it back to the council for discussion, mister councilmember Nielsen. Thank you, mister mayor.

Just a couple of things. Actually, it all involves around one date, which is the Saturday before Super Bowl, which was paper football. And, you know, a serious event if you've ever been to that. Our team, the Tustin House Lions, came in second and third the last two years. And this particular year, we got smoked. So that part was very depressing. But there was one silver lining, and that silver lining was in the sample game where I played council member Fink, I won. So that was all good. So I can use that for gloating for another year. So that's that's really all I have for tonight, mister mayor.

Thank you. Council member Fink. Three way series. At the end of

the year, who's voicing the trophy? Don't know. But I did enjoy the competition. I certainly was at the paper football event. And it's an excellent event. And I encourage all to participate in it in the future. It was really great. A couple of comments. One is on our guests from the Tustin Public Schools Foundation. I appreciate them being here this evening and presenting us with a dinosaur.

I've sponsored that event for the last several years and have a collection of dinosaurs myself. I have a particularly chunky dinosaur from the 2020 event that I was fortunate to get. And so those are are great. And if they're watching still, I'm I will re up my sponsorship for the 2026 event. I had a chance a couple weeks ago to meet the Tessa Municipal Employees Association board, and so I really appreciated that.

But to to work with our our our municipal employees, I've had chances to meet with the police officers association in the past and and folks from the fire association and have plans for to meet with them again, but it was good to meet with the municipal employees and get a good perspective on the various work that all the folks in the city do. Thank you for that. Let's see. On Thursday the twelfth, I attended community meeting of the at Zov's about the development at Enderlea Center to be called Campo At 17th Street. And there was a full house.

In fact, it was pushed out to the Zov's patio because there were so many people there. I was only able to stop in for about ten minutes or so because I teach a class at the law school on Thursday nights. But there was a great turnout. Somebody was handing out my cards. But that project looks to be moving ahead now. And I think they've had good community meetings. They've had good outreach. And I'm very excited because they're maintaining the heart of Enderle Center. They have plans to build about a 100 actually, not about. It's the number is a 100 residential units, which is far less than the 413 that it's zoned for and that people are out there concerned about.

So I just wanna make sure everybody is understands that and knows that it's a far smaller number. And I'm very excited about the plans. I'd love to talk to people if you've got concerns, thoughts about it. If you live in the area, I want to know what you're thinking. I had a chance on the next day. Went down to San Juan Cap Estrella to the River Street Marketplace. I met with Dan Almquist, who's a fellow Foothill alumni, and I know he's one of the people who's got bids in for one of our chunks of land. But I got to see the the development that he's got at the the Albacost Properties has it at River Street Marketplace. And I'd encourage everybody to go down there. It's right off the train station, and I had this thought.

And I told him, I said, we should take my, you know, my daughter down there. They've got a petting zoo. And that's a hard thing for me to say. As I've mentioned to councilmember Snell, I don't like going to Handel's ice cream because it's on the other side of Jamboree in Irvine. So if I'm willing to go down to San Juan Capistrano, that's a big deal.

But I think that it really gives an idea of some of the ideas an idea of some of to bring into Tustin. And I it it would it's it it was worth seeing. I also wanna note, by the way, on that Enderle Center meeting, I've also been in communication with a couple of folks regarding the Cypress Grove project on seventeenth and prospect. And I need to follow-up, and I will follow-up. But if folks are concerned about that as it moves forward, I wanna make sure that we're addressing those issues on an ongoing basis with folks.

So as that development hits the whole 17th Street corridor, we want to make sure that its impacts are minimized because I think that both of those are going to be ultimately positive if we make sure that they're positive. And then I attended the Smooches and Pooches event at the Bark Barracks on Saturday. Brought brought my very loud beagle to the event. But it was a great event. Huge turnout. I did not expect to see just the number of people there. It was really great to see. And the the dog park continues to be very successful. So great event by the parks department. Great turnout.

Thanks for everybody for that. I wanted to mention other people will mention this, I'm sure, too. But I believe today is the first day of the Lunar New Year. I don't want to steal Councilmember Gallagher's

You say that right as you do it.

I know. But you can still do it later. And also, Ramadan starts tomorrow. So to the Muslim community, Mubarak Ramadan, Make sure you're thinking about them, especially as you're planning events during the course of the month when they're fasting during the day. It is also Black History Month.

Recognize everybody in especially in Tustin who has served in in Al Murray, Leticia Clark, and others. I see Rob Nelson who's I don't know if Rob's our African American first African American lieutenant, but I appreciate everything the African American community has has done during Black History Month. And, of course, I, know, usually don't wander into this, but it's notable that on in Black History Month, Jesse Jackson passed away to the I this morning or last night. And so a lot of folks remember his advocacy during the times. I also want to note, I learned this I've actually learned this at mass.

But Chris Layton, who was the president of the Testament Unified School District Board in the eighties, passed away last month. So I just wanted to note that he passed away, and condolences to his family and friends. The last thing I'll just note is I want to just reiterate this point as we get forward and head towards the budget process. I know as we've done the midyear, I've said it before, but since it's worth restating that it's important to make sure that we've got a strategic plan that conceptually continues, I think, to apply, but is out of date. And I think that it's important.

It would be a very useful, important exercise for us to update it with the budget process so that when we adopt items on our agenda that say they align with our five year strategic plan, we're not adopting items that correlate to a five year strategic plan that's now three years past its date. Don't think it's going to take a big consultancy effort. I think we're a lot of it's the same, but I think it's important to update that. I'm hopeful that we could look at that aligned with our budget process because I think that timing would be right. That's all I need.

Thank you. Council Gallagher?

Yes. Happy happy New Year. No. Actually, council member Fink was the one that actually told me it was the New Year, so he he had a right to say that first. I was just wishing our mayor Botem a happy New Year, and he reminded me that it actually was the the New Year today. I did look it up, though. Interesting fact. The this is the year of the fire horse, and it's predicted to be dynamic and fast paced symbolizing independence, momentum, and bold change. And I thought, wow. That is the spirit animal of our city manager, Aldo Schindler.

And I think it's very representative of this year, and I thought it was meaningful to bring it up in the contents of our consent calendar. So we had we didn't do our usual round of applause for parks and rec, but there is the annual report in the consent calendar and wow did they do a lot. It's amazing what they're able to do. And this is a huge part of why people live in this community. It helps our quality of life.

Simultaneously, we had a police item for the Axsome equipment which is a huge investment in our efficiency, protecting our police, protecting the public which is the main reason that we are here in government is to protect the population. And so I say that dynamic and fast paced momentum and bold change represent 2026 for the city of Tusson, I mean that as a challenge. We cannot do all of those things. That's the investment in the police, paying them market rate, doing all the parks and rec unless we have the development projects. And so I challenge all the directors here, we want to be the type of community is having investors like the Enerley Center that has Tustin legacy getting a lot of response, a robust response from the investment community.

And so every department has the opportunity to be efficient with our funds, to be prudent in how we plan and to be effective on how we use the resources that we have and so I challenge all of you to embrace the year of the fire horse. Alright.

It was very poetic. Mayor Pro Tem.

Fire horse. That's good. Just very good. So I I'm gonna break my my own rule, I normally say the beginning of New Year, you get to say happy New Year for the first week, then you have to pack it away. But because it is a Lunar New Year, and that is why council member Gallagher is saying that somewhat tongue in cheek, happy Lunar New Year to everyone.

February 3, I attended the OC Cemetery district meeting. Continue to work on the development and financial planning for the Gypsum Canyon Cemetery. Very excited to see that come to fruition. We're actually discussing and negotiating with the city of Anaheim and also with the county to do some of the underground work to bring water and power into into the cemetery area so we can start building out the the underground and then eventually build that beautiful cemetery. On February 12, attended TCA joint meeting of the Board of Directors.

At the meeting, we elected a new chair and vice chair positions for for the next year. We also selected and approved the architectural services firm that is going to proceed with the design work on the improvements to the Pacific Building, which has been around for about thirty, forty years and is sorely in need of upgrades. And then lastly, we reviewed the updates of the 2526 state and federal legislative platforms for the TCA. And then on February 20, this Friday, I'll be touring the Tustin OC Animal Care facility, which I'm looking forward to that. And that concludes my report.

Thank you, mister mayor pro tem. To council member Gallagher's point, we had a lot on tonight's agenda. We focus much of the time on the budget, but just a couple of highlights. We have a very positive outlook on our finances. Thank you to staff and and past councils for putting policies in place.

We are seeing the the fruit of those labor, and we will have opportunities to invest in the community because of that, and, looking forward to making those decisions. We're activating a bunch of land out on the legacy at a pace that has not been seen, as far as I'm aware since it closed. And, that's a lot of thanks to staff and the council for being willing to, make those decisions to move now and not let Sacramento tell us what we can do with with or without our land. And, we're moving into the next generation with, law enforcement technology. It's a big deal.

It was on consent. We we pulled and talked about it a little bit, but thank you for the leadership at at PD for, taking us into that next, chapter, standardizing our tools and systems and being more effective on on the streets. And in the the fast paced notion, my family has a tradition on on Valentine's Day of watching a a a romantic movie, and my 14 year old daughter a couple years ago suggested that we watch, the one of the sappiest movies of all time, Top Gun Maverick. And so, I thought there was an interesting analogy there, and we do it every year now. But we were like an aircraft carrier that was not moving a few years ago, and we are now moving and quickly, and it takes a lot to get that momentum.

But I'm I'm feeling it as mayor, and I I really do appreciate everybody in this room for being engaged in that pace. Fire horse or not, we're we're we're moving quickly, we've got a lot of wins that we're chalking up in a sort of ho ho matter, you know, that they're on consent, and I just wanna thank everybody for being engaged in in those those victories. Okay. With that upcoming events, we have the fair housing fundamentals workshop on Wednesday, February 18 from two to 4PM at the Tustin Library, and we have the sip and stroll on Saturday, February 28 from noon to 5PM in Old Town Tustin. Tickets can be purchased from the Tustin Community Foundation. Next, we will adjourn the meeting. The next meeting is scheduled Tuesday, March third twenty twenty sixth with a closed session meeting at 04:30PM and the regular business meeting at 6PM. Thank you. Have a good night.