City Council - Regular Meeting

Good evening, everyone. I'd to call to order the special closed session meeting of the city council. It is 5PM meeting number 3098. Madam city clerk, roll call, please.

The record will reflect that all members are present with the exception of mayor who will be arriving shortly.

Thank you. Next, we will move on to public input. At this time, any member of the public may address the council on matters which are on the closed session agenda. 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. Madam city clerk, any request to speak?

No, mister mayor.

Thank you. We'll move on to the closed session update, mister city attorney.

Yes. Good evening. The the city council will be convening in closed session regarding conferences with legal counsel regarding pending litigation items four a and four b as they appear on this afternoon's closed session agenda.

Thank you. We'll recess the closed session. Good evening, everyone. I'd like to call to order the regular meeting of the city council to 06:02PM, meeting 03:09 eight. Tonight's invocation is by doctor Deanna Helmy from the Islamic Shura Council of Southern California.

Doctor?

Good evening. Thank you, honorable mayor Lumberton, respected, city council members and council member Fink for making the connection. It's an honor to be here and to share this invocation. In the name of Allah, the Arabic word for god, dios, Elohim, the most compassionate, the most merciful. We gather this evening in a spirit of humility and shared purpose, grateful for the blessing of community and the responsibility entrusted to those who serve it.

As we begin, we ask for guidance, clarity, and wisdom. O Allah, source of all peace and justice, illuminate our hearts with compassion. Help us see one another with sincerity, listen with patience, and speak with integrity. Allow our differences to be a source of strength rather than division, and let our diversity remind us of the richness you have placed in humanity. We pray for this city, its leaders, its residents, its workers, and its families.

Grant our counsel the ability to deliberate with fairness, to seek the common good, and to act with courage, even when decisions are difficult. Let their work today and every day contribute to a community where dignity, safety, and opportunity are shared by all. We ask for your comfort for anyone in our city who is struggling those facing illness, loneliness, or hardship. Surround them with mercy and support. We also give thanks to those who commit their lives to service, from first responders to volunteers and everyday neighbors who care for one another.

O Allah, make us instruments of harmony. Where there is discord, help us bring understanding. Where there is uncertainty, bring steadiness. Where there is possibility, bring vision. Bless this gathering, bless this council, and bless the city of Tustin. Amen.

Amen. Thank you, doctor Keller. Tonight's pledge of allegiance is by Mayor Pro Tem Schell.

Please rise if you're able to honor our flag in this great country. Please remove your hats. If you have served in the military, you're able to render a salute. Hand of a heart, begin.

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. Okay. Thank you. Alright. Next, we have our presentation portion of the agenda, and we have Historic Preservation Week twenty twenty six and a presentation by Erica Demkowitz. Erica?

Evening, Chair Lombard, members of the City Council. My name is Erica Demkowitz. On behalf of the Historic Preservation Team, I'm here tonight to present Historic Preservation Week, which will be taking place May sixteenth through the twenty third, right here in Teston. This is an opportunity to celebrate what makes Teston unique, its history, its character, and its shared stories that connect our community. Historic preservation isn't just about looking back.

It's about using our past to strengthen our future. This year's theme is Tustin's Roots, From Packing Houses to Suburbs, and covers the early beginnings of Tustin with indigenous people in the Red Hill to the agricultural beginnings of a small town that later grew through the development of packing houses, the railway, early old town buildings to postwar suburbia. As in years past, the Tustin Area Preservation excuse me. The Tustin Historic Preservation Division will be teaming up with our historic preservation partners, the Tustin Area Historical Society and the Tustin Preservation Conservancy to bring you exciting and fresh ways to see and experience Tustin's history. One of the most exciting ways that this comes to life is through the signature events that we have packed for the week during Historic Preservation Week.

And we start things off at the Tustin Library on Saturday, May 16, where residents or visitors can meet the historic preservation team, members of the Historical Society, the Preservation Conservancy, view books from the library, check out some antique cars, grab some Tustin swag, and if you have kids, bring them, because we'll have coloring pages for them as well. On Sunday, we'll have an Old Town walking tour. And this year, we'll be doing what's called the Third Street Stroll along 3rd Street. On Monday, we will have a Citrus Park Walk and Talk. This will take place at Citrus Ranch Park.

Residents can meet with the Historic Preservation Team and a member of the California Department of Food and Agriculture for a walk and talk amongst one of Tustin's remaining orchards. On Wednesday, we'll have a Tustin Citrus Care Talk at the Armstrong Garden Center here in Old Town. This is a new event that we're adding this year featuring a test in business where visitors can learn more about growing citrus today. We'll also have a raffle and some tasty treats, compliments of Armstrong's. On Thursday, we'll be at the Sunset Market.

We'll have our table set up near the Historical Society Museum for their open house. Members of the public are invited to tour the museum, grab some Tustin swag, talk to us and learn more about city's historic preservation programs. On Friday, we have the ever popular Cemetery Tour, which is back. Again, this year, we'll be visiting the Santa Ana Cemetery where many Tustin icons are buried. The tour will focus on those involved in the early development of the city and the citrus and ranches.

And last but not least, we'll conclude and wrap up the week at the Night at the Museum, which will take place at the Tustin Area Museum in Old Town. Include information about the downtown improvements that are supporting the Old Town businesses. And beyond these signature events, there's also year round opportunities to engage with Tustin's history. And we have programs like the city's historic register plaque program, the Mills Act program, events through the Historical Society and the Conservation Preservation Conservancy, museum and library events, home and garden tours, and youth education initiatives that make history accessible to all ages. These programs ensure that preservation isn't static.

It's active, inclusive, and continuously growing. The events of Historic Preservation Week transform Tustin into a living experience. Residents and visitors can walk through residential districts and hear stories of the remarkable people and buildings that exist. It's a way to engage directly with Tustin's heritage. It's vibrant, it's educational, and it brings the entire community together.

This is preservation not as a concept, but as something people can see, hear, and feel. So for more information about this week's events, which I've just highlighted, you can go to the city's website or scan the QR code for the information that we will be sharing online as well as at the events. Over one hundred and fifty years later, preservation continues to shape the identity of our city. It strengthens community pride, supports local businesses, and creates a sense of place that you simply can't replicate. When we invest in preservation, we're not just protecting buildings, we're preserving the character and continuity of Tustin itself.

At this time, I'd like to also extend heartfelt gratitude to both of our preservation partners at the Tustin Area Historical Society and the Tustin Preservation Conservancy for their collaboration, assistance, and participation in this year's event. They are integral in the planning process, not only for Historic Preservation Week, but also for the city's historic register plaque program when we receive plaque nominations that are reviewed by our planning commission. So thank you. This concludes my presentation, and hope to see you at one of our events.

Thank you, Erica. Okay. Next, we'll move on to 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 matter is 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. Madam city clerk, any requests to speak tonight?

Yes, Mr. Mayor. We have a couple of requests to speak. The first is Leslie.

Okay.

Good evening, council and mayor. My name is Leslie, and I'm a resident of Tustin. In the last council meeting that I came to, I talked about the how the flock cameras are security risk, not only to the citizens of the city, but as well as the police departments themselves. They have the capability of storing data that exceeds their sales pitch promise of temporary storing and are hackable and and cost a a substantial amount of funds. Their primary edition looks like a black rectangle with the curvature on top to protect the lens and usually comes with a black solar panel, but not always.

So I went ahead to canvas out and find those I could in the city of Tustin and with the corresponding users and software with my main concern being the flock software. So there's 13 cameras on Red Hill Avenue and East Warner, all operated by Tustin PD with the Motorola solution software. There's five cameras on Newport Avenue heading north towards Edinger Avenue, all operated by Tustin PD. Two assigned with the Motorola Solutions and three have flock software already. At Tustin Legacy, there's 28 cameras in total, 22 with the Motorola Solutions for Tustin PD.

One from Lowe's with the flock system already in it, five are unidentified with unknown software and users. Eight cameras around the Costco and Tustin marketplace, two for Tustin PD with Motorola Solutions, two from a Leonardo software that I'm unaware of with an unknown user, one with Flock for the Tustin PD, and then three unknown. Seven cameras around and facing Pioneer Middle School with Motorola Solutions and operated by Tustin PD. Four cameras on intersections around Pioneer Road and Jamboree Road, all Motorola Solutions operated by Tustin PD. Seven cameras on 17th Street and Yorba Street, all operated by Motorola Solutions and operated by Tustin PD.

One camera between Holt Avenue and Dahl Lane facing the Loma Vista Elementary School with an unknown user and uses the Flock software. So in reference to that, I looked up to see how much Irvine has and they have about over 200 FLOC cameras already attached to their police departments. While Tustin only has around four to six FLOC cameras. And it is my hope that we can dwindle that to zero instead of increasing. At the moment, I am doing a research report that will highlight key points and should be done by the end of this month. If that is something that interests you, all you have to do is ask me. Thank you.

Thank you for your comments.

Mister mayor, our next speaker is Craig.

Craig? I don't see anybody jumping up. If Craig's here, you're up.

Those are all the requests that I have. And we might have one additional request, but it's not determined quite yet.

Okay. Well, we don't have one right now, so we're gonna move on to the closed session report. Mister city attorney.

Yes. The council took no reportable action.

Thank you. Next, we have the consent calendar, items one through nine. 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 wish to address the council, please submit a request to speak form if you have not already. If any members of the public who are participating through Zoom wish to address the council items one through nine, please raise your hand. I'm going to note for the record that one public comment from a guest user was received for item number eight, which was distributed by the council and made available for the public on the city's website. And item number eight is going be pulled by both the city attorney and council member Fink. Any other requests to pull an item from the consent column? Eight and nine.

And, mayor, there were two other comments that came in after that first comment.

Okay. Eight and nine. Any request to speak on the consent calendar, madam city clerk?

No, mister mayor.

Okay.

Do I

have a motion for the balance, all items except for eight and nine?

I'll make a motion, mister mayor. Second.

Motion and a second, madam city clerk.

Councilmember Nielsen?

Yes.

Councilmember Feek?

Yes.

Councilmember Gallagher? Aye. May I approve from Schenck?

Yes.

Mayor Lumber?

Aye.

Motion passes, five-zero.

Thank you. Item number eight is the proposed ordinance to regulate the operation of e bikes, bicycles, and other regulated mobility devices pulled by Council Member Fink and city attorney Kendig. But I'm going to hand it over to city attorney.

GREGORY Yes. Good evening, Mayor Lombard and honorable council members. There's been a suggestion to add a word to clarify one specific provision in the proposed ordinance before you this evening. And I agree that the suggestion would help clarify that provision. So the word or would be changed to and or in section 5,346 subsection E.

As revised, that subsection would prohibit and now I'm reading it as revised quote, operating with more than two bicycles and or regulated mobility devices side by side. So staff's recommendation is that the city council introduce and conduct first reading by title only of ordinance fifteen seventy six with that revision to section 5,346 subsection e and to schedule the ordinance for adoption of the city council's next scheduled regular meeting. And I'd be happy to answer any questions about that.

I was going to support it, but now you've added and. Councilmember Fink.

Thank you, mayor. I appreciate that. And I just want to there were several comments about this ordinance from the public. And I wanted to address them because I think there were two and just express my views on them. One was about the speed limits on the sidewalks.

And I appreciate where the commenters basically said apologies if it's summarized but basically said, hey, if there's nobody on the sidewalk, maybe we shouldn't have a speed limit or a yield issue. And the problem with that and my concern with that is the reports I've gotten just even here on Main Street that people will be riding on the sidewalks. And some of those businesses don't have alcoves or they enter right onto the street. So you might not realize that there's people there. So I think the speed limit on the sidewalks, even if it's not obvious, is still important.

And a note to all of this is that our police department is going to be enforcing this with a fair amount of discretion. I'm not saying that nobody has ever driven over 55 on a freeway or exceeded the speed limit. But I don't think that the police are going to be stopping relatively safe cyclists on the streets. What this does highlight, and it may come up later, of course, is to make this all work is to have safe spots for pedestrians on the sidewalks, safe spots for cars on the streets, and safe spots for bicyclists in bike lanes. And that's why I think we've talked I've talked about the active transportation plan. A lot

of folks

here talked about it in the budget workshop that we'll get to. But having spots for everybody is key to making the system work well. So I appreciate that. I appreciate the concerns about wobbly at a really low rate, because I've done that. But at a certain point, if it's school, in Park's sense, maybe we just get off. The second is I did note people were worried about the side by side writing. And I think that can be answered by just, you know, you don't go totally side by side. Two across is fine. Three across starts to be a little broader. But I think this is a good spot for it.

These can all be adjusted as we go forward. But I think it's very important. We've heard a lot of this here in the city and throughout the county. It's been an issue. And so I think make sure we've got a safe ordinance for our bikes and e bikes, making sure we're treating them consistently. And then the next step is making sure we have safe spaces for everybody with the active transportation plan. But I wanted to respond to those comments because I appreciate where folks are coming from. But I wanted to let you know what I thought. And I think it's a good ordinance. And hopefully, it leads the way for the rest of the county.

Was that a motion?

I'll make a motion to adopt the staff recommendation in the ordinance.

I will second it. Is there further discussion?

Yeah. Just comment. Think this is well, well overdue and and a good move on our part. My concern is the miners that have a lot of power now, much more than they used to, on the streets and sidewalks. And, I was looking at the collisions, and I did ask a question.

Although, I know in short order, didn't quite get an answer back on the collisions, how many were involved with miners. So, you know, it's it's good that we have this. And I think as we progress, and I would imagine the chief and the police department along with our other departments in city will will kinda monitor this as things progress to see what we need to change down the road. So, anyway, I'm glad to see this happen.

Thank you. Further discussion? Madam Sertig, city clerk roll call, please.

Councilmember Nielsen? Yes. Councilmember Feet? Aye. Councilmember Gallagher? Aye. May I approach them Chanel? Aye. Mayor Lundberg?

I'm gonna go aye and say that a lot of residents have asked us to do something, and I've never heard a resident say, don't do anything about e bikes. So thank you.

Motion passes five zero.

Thank you. We're going to move on to item number nine that was pulled by Councilmember Finken. It is acceptance of public improvement and authorization to file the notice of completion for the Camino Real Camino Real Park playground renovation. Councilmember Finken.

JAMES Thank you, Mayor. I just wanted to say thanks to the Parks Department and Public Works Department that have put that together. I actually went by the new playground a couple of weeks ago on my bike. And it looks really good. And there were a lot of people there. So thank you for that. It hasn't been officially tested by my Parks advisor yet, but I'm sure she'll get there in the near future and looking forward to the rest of the renovations at the picnic shelter. With that, I'll move the item.

Do I have a second? Do you want to second it unless you make a comment? All right. Second? No, you can make a comment.

I do want to thank Parks and Rec and Public Works and point out that we were $100,000 under budget. So again, appreciate the work from Director Grisso and from Director Clanton and the rest of the staff to bring this beautiful park into Tustin, update it, and do it again under budget. Thank you.

Further discussion?

Just congratulations to Chad and his team. And this is great. And I look forward to the Heidemann Park ribbon cutting.

Further discussion? Okay. Madam city clerk, roll call, please.

Councilman Nielsen? Yes.

Council member Fink?

Aye.

Council member Gallagher? Aye. May I approach John Schenell?

Aye. May I remember?

Aye. Question passes five zero.

Thank you. Next, we will move on to the regular business portion of our agenda. We have one item tonight, which is the fiscal year twenty twenty six-twenty seven budget workshop. I'm going kick it over to city manager Aldo Schindler.

Thank you, mayor. Good evening, mayor and members of the city council. In a moment, our Finance Director, Jennifer King, will be presenting an overview of the primary variables of the city's fiscal year twenty twenty six-twenty twenty seven budget, which represents both the second year of the city's biannual budget and is also year two of the council's ten year fiscal sustainability plan. The council first adopted the fiscal sustainability strategy during the budget process last year as a means of providing policy level guidance and to set a clear expectation for achieving a sustainable and structurally balanced budget that consistently aligns with the recurring revenues and recurring expenses, all the while still upholding Tustin's incredible high quality of life standards for our community. The purpose of tonight's budget workshop is to facilitate both community and city council feedback on the key budget assumptions and potential options to guide the development of a proposed budget that will be presented for council's consideration at our June 2 city council meeting.

To help promote community awareness about the city's budget process and invite participation in tonight's budget workshop, a short video was shared on the city's social media platforms. As of this morning, there were almost 4,500 hits on all of our social media platforms in regards to that video. With that, we'll display the video now. And then our finance director, Jennifer King, will start our staff presentation.

Every June, the Tustin City Council adopts a budget that funds essential city services for our fiscal year, which runs from July 1 to June 30. Last June, the council adopted a ten year fiscal sustainability strategy plan with one main goal, a structurally balanced budget where everyday revenues fully cover everyday services. The general fund powers Tustin's daily operations and is made up of three key components, revenues, expenses, and reserves. Sales and property taxes make up about 65% of our general fund revenues. When you shop or dine in Tustin, our sales tax is 7.75%.

Of that, Tustin keeps just 1%. The rest goes to the state and county. And property taxes? Of every dollar, Tustin gets only 13¢. Tustin Unified School District receives 44, and the remaining 43¢ goes to state, county, and other local agencies.

Public safety, including police and fire, accounts for over half of our general fund expenses. The rest maintains parks and streets, supports growth, community events, and keeps neighborhoods clean, green, and vibrant. General fund reserves are our financial safety net for economic dips or emergencies. With smart planning and teamwork, we're building a vibrant, innovative Tustin, a hometown to live, work, and play for generations to come. Join us for the twenty twenty six, twenty twenty seven budget workshop. For complete details, see tustin c a dot org.

Thank you. Director King, you're up.

Thank you, mayor and members of city council. Let me pull up the presentation. And thank you again for the opportunity to come before you to discuss the proposed 2627 budget. And as our city manager mentioned, this is year two of our biannual budget. And we first presented the biannual budget to you last June. And so we are coming back for an update.

Can Can we move to presentation mode real quick?

I

I'm If we can't, it's alright. Go ahead.

Presentation mode?

I don't know what else is gonna pop up while we're doing this. Let's just get in the presentation. There we go. Thank you.

Thank you. Sorry about that. I need some professional expertise. So I'd like to first start with just a brief agenda for tonight's presentation areas that we like to touch on. And we'll start with some definitions. And I talk about budget all day long. So for me, it's my daily language. I sometimes forget people don't talk like that. So we'll we'll go back and review some definitions of how are some of the terms apply. And we'll look at some examples of budget scenarios we like to bring forth to you for consideration.

And looking at we'll also look at general funds projected revenue details as well as its expenditures. And finally, we'll wrap it up with the capital improvement program. So budget language, budget terms. And so the most important budget term, we always it's our what guides our budget process. So the ten year fiscal sustainability sustainability strategy is our guiding principle.

And we'll have more details. And other items that we talk about what's recurring, which is what what do we call as our ongoing operating revenue and expenses. And what is a structural balance budget versus what's a budge total budget. And we'll talk about the general fund, the general funds reserve, legacy fund, also legacies fund balance. That's what's available to continue to develop legacy.

And we'll also talk about what is a capital improvement program. So start with the guiding principle. This slide is just a refresher of what we talked about last June. And for on an ongoing basis, what what we are looking to improve for general funds ongoing revenue through additional through new developments of city owned properties that will generate recurring property tax and sales tax. And those are funding they they are the major funding source of generals, general fund activities.

We are also looking to decrease, to be more efficient with service deliveries and to achieve operational efficiency, also continue to make pension payments to reduce our UAL burden, our pension burden. And we're also looking to reduce the use of one time revenue to fund ongoing operations. And this is a necessary step to achieve a structural balanced budget. More definitions on the revenue side. So what is recurring revenue sources for us for the city of Tustin?

What it means is property tax, sales tax, as I mentioned before, and we also collect other taxes and also fees, charges, and earnings. So those four major revenue categories make up the general fund's recurring revenue, ongoing operating revenue. What's considered non recurring revenue sources for the general fund? And those will be something that doesn't happen every year. And for instance, this council approved the sale of 1st Street, which is anticipating to be completed in the coming year.

So that the sales the sale proceeds is a nonrecurring revenue item. So is any onetime grants that we receive. Any internal sources really just means transfers coming for just for non recurring items that we need funding from other sources. And also the use of reserve is a nonrecurring item. Together between those two buckets, they make up the total revenues that you'll be seeing in the general fund.

On the expense side, it pretty much follow a same trend. Recurring expenditures include operations of the departments and that includes public safety and all other general governmental services. And it also includes programs or services that cover citywide activities. For instance, the animal care services we we contract with the county. So that is citywide programs.

And non recurring expenditures includes also, there are some citywide program in there, but they only happen once. They don't happen every year. And we also have service and equipments that only happen once or twice, and they don't happen every year. So those will fall under the nonrecurring expenditure bucket. Together, they make up the general fund's total expenditures.

When we consider a structural balanced budget, we are talking about the recurring operating components from both buckets. So the idea is your recurring ongoing revenues supports your recurring ongoing expenses, thereby achieving a balanced budget. Every agency have some kind of nonrecurring revenue and expenses, and so that is being added here to represent the total budget as a whole. But we don't we don't want to rely on non recurring revenues to support recurring expenses. Continue with somewhat definition.

What is the general fund? The general fund really is the primary operating fund for the city. Consider that like your checking account. That's your primary checking account to pay for daily operations, personnel costs, services, contracts, and city initiative. The council poll council has approved a policy to maintain the reserve level at 15 to 20% of the operating expenditure.

What is the legacy fund? You might heard different phrase different names for the fund, but what this means is that legacy fund is a primary funding source to support the development of Tustin legacy. And it gen it pulls the revenues, it pulls from the sale of city owned properties, city owned lands in legacy, and in turn, it funds the legacy development. Capital improvement program, again, it supports citywide infrastructure, parks, roads, and facilities. And those provide deliver services to the general public and local businesses.

And they are we have different kinds of funding source to support a CIP program, which later on I'll have a slide that details what is supporting the 2627 CIP program. So this is a lot of boxes in here, but I will the gist of this slide is that starting from the left, on the operating under recurring, which is the operating bucket, the general fund is proposing 105,000,000 in revenue and 106,000,000 in expenditures and has a slight small deficit of 800,000 under the recurring column. In the middle is the non recurring column that we talked about earlier. So in in this proposed budget, we are looking to have 17,500,000 non recurring revenues that includes use of general fund reserve to support 16,700,000 of non recurring expenses with a surplus of 800,000. Together, once you put the two buckets together, they lined up to ending total ending number of zero at the end.

And it's the budget balance itself. The inflow matches the outflow. If I may go back one more slide go back one slide. So what is on this slide? The what's in the 16.7 non recurring expenses?

I will have some more details coming up. But if you can keep your eye on that number, 16,700,000. And what is in the 16,700,000? It's making up of all these items that you see in the two two different buckets. And some of those items have been presented to the council last June during the biannual budget.

The only new item in this lined up is the general plan update, which is a million dollars. That is a new item that staff is proposing this year. So what this chart is showing you is this is a scenario that if we are using the general fund to fund service and equipment to the tune of 2,600,000. And still, we want to be able to show all these line items under the general fund because they are related somewhat related to the general fund's activity even though some of them are not happening every year. In that scenario, the general fund will need a transfer from the from the legacy fund in the amount of 14,000,000 to supplement the spending.

And in that scenario, the general fund will end up with a 24% reserve level and the legacy fund will be transferring 14,000,000 to the general fund to support the non recurring items. This is one end. And the other scenario, again, the same dollar amount, but the makeup of the funding source is slightly different. In this case, the general fund use more reserve to support non recurring items. We'll only ask for a transfer of 11,000,000 from the legacy fund to support two non recurring items.

In this scenario, general funds reserve will be less because more reserve is used and the legacy fund will transfer less and 11,000,000. So these two scenarios is the the the higher scenario versus the lower scenario. It book ends the the spending plan and council it's up to council, completely up to council's discretion and however you would like to direct staff on funding sources. But we want to lay out outline the two two ends just for consideration. Again, going back to general funds total revenue.

What are we looking at here is this is another presentation, just another format on looking at the numbers. The blue number 105,000,000 is the recurring piece. And the orange pie slice, 17,500,000 is the nonrecurring piece. It includes the land sale proceeds, 2,200,000 from 1st Street. And it also includes internal transfers, include transfers from land sell from legacy fund and use of reserve.

On the operating side, recurring revenue, we broke up the recurring revenue into four major categories. And sales tax is our leading revenue at 37% followed by property tax and then fees, charges, earnings, and lastly, other taxes. This is a historic trend for the operating revenue. And as you can see, the operating revenue has been trending up over the years. And percentage wise, they stay pretty consistent.

And the largest portion, sales tax stays at about 37 sorry. I jump ahead of myself. Sales tax stays at about 37 to 39%, Property tax about 28 to 29%. And the other pieces you can see it's pretty consistently proportionally on the chart. So looking at total expenditures, similar format.

The orange pie the orange pie is the nonrecurring piece And 16,700,000, you have a more you have a detailed breakdown in previous slides. And so again, it's the council has discretion of on how to fund this 16,700,000. This is a look of the general fund recurring operating expenses by department. And I would also like to present the historic trend similar to the revenue line. And again, the operating expenditures have been trending up and this is consistent with the operation with across the board with other agencies and operating expenses have been increasing probably at the rate of three to 4% at least per year.

And it also depends on MOUs. And proportionally, department each department stays pretty consistent over the years. And three departments usually have over 10% of the total. And police department usually is around 41 to 42% starting from 2023. And followed by public works usually is about 19% of the total.

And fire usually is about 11 to 12% of the total. And this is a look of the position control position, approved positions by departments of five year. And our headcount has been increasing as more we have more service deliveries, more services provided, and need we need personnel in order to deliver those services. And the largest department will be police. And for the 2627 proposed year is 166 full time equivalent.

Of that, 107 is Swan and 59 is non Swan. Moving into the capital improvement program. And this is a chart this is a pie chart of the capital improvement projects by type. And as you can see, legacy streets and traffic in combination makes up most of the CIP. Total CIP 68,000,000.

And of that, a portion of that is rollovers, carryovers from 2526. As some of the projects, we won't be able to finish the projects. They will typically be roll over into the new year and until the project is done. And so the rollover piece is 41,000,000 and the new request, it's approximately 26,000,000. Some of the rollover significant rollover projects in 2627, Heidemann Park is one And that's originally budgeted starting in twenty five-twenty six.

And also the ongoing Old Town and Main Street is another one that will be finished in twenty six-twenty seven. And also Armstrong Bridge, and that's also something that being rolled over. And also Neighborhood D Infrastructure Phase 2. And that's also being rolled over. And with the new requests, the largest one will have more details on CIPs later on.

Under the new request, some of the larger ones will be annual street maintenance. We always have annual street maintenance going every year. And we also have there's also Jamboree's Rehab between 5 and Portola. And there are some new requests, additional requests for Neighborhood D South Phase 2. This is another look of the capital improvement program by funding source.

And what we most of the city's CIP are funded from external sources. And starting from the top, the blue pie allocation clockwise all the way to the bottom water rates. And about 45,000,000 out of 68,000,000, it's funded from external sources. And the remaining is funded from sources that council have complete discretion over from land sale proceeds and general fund. On this slide and the following couple of slides, I'll go into a little more detail on what is being proposed for each CIP categories.

So this first one is the legacy category. And so you can see some of the major projects that's being planned in the coming year. Some of them already underway and continue to to be completed. And this is the next big category, streets and traffic, 28,000,000 in total, and a number of programs are being planned. For smaller category, but not least, this is the park program heading up by the Heidemann Heidemann School Park, 7,400,000.

And we continue with facilities. This is citywide facilities. So they all need some upkeeps and maintenance and some of them are remodels. And lastly, this is the water enterprise CIP program. And we continue to do well rehabs and also continue to update facilities.

So

moving on to the North Hanger, this is just a reminder. This is an something that we continue to work with the Navy, wrapping things up and continue to get reimbursement from the Navy. So far, we have invoiced Navy 104,000,000, and the Navy has paid the city 84,000,000. Now the balance outstanding is 20. And we continue to invoice the Navy for work performed and it's not finalized yet.

This last chart is the pension history and pension projection. Just as a refresher, the last time we looked at a similar chart was this past February when we present a six year pension pay down strategy. And so on this chart, it projects that if we continue to project that the city will pay off the pension liability UAL by the time we get to 31, 32. And we will refresh this projection every anytime we get updated information from CalPERS. And we expect that next update to be in August, so three months.

With that, I'll wrap up my presentation. Happy to answer any questions.

Thank you, Jennifer. And know it was a team effort to put together that presentation. So thank you very much. In my opinion, that was the best budget presentation that I've seen in eight years up here. So thank you very much for that. Do we have questions for staff before we have public input? Yeah. Yes. Councilmember Nielsen.

So, first of all, thank you very much for the herculean task you did in putting the presentation together, you and your team. Particularly, I think that's the first time I've ever seen a video for a budget and finance stuff. So that was that was pretty cool. So thank you very much for for coordinating all of that. Just a couple of things.

I'd I'd ask the city manager. He did get me some of the numbers on this, but I'm just trying to get kind of the water enterprise debt versus kind of the total city debt, kind of that ratio. I'm not gonna put you on the spot here, but, you know, I'd be curious to see, what the enterprise is versus the rest of the city, debt wise. And then the second question is, I was just curious. And for whatever reason, my iPad's not working, so I can't get to it. But is the TOT tax trending up or down over the last few years?

May I answer the first question first

on the Sure.

Go for it.

And so the Water Enterprise currently has about $39,000,000 in outstanding debt. And 36 of that is due to bondholders. And 3,800,000 is due to the city's general fund. So that those debt the repayment of all those debt is is using rate revenues. And so that is factored into our rate model.

And it's it's not using any other funding source for the repayment. On the Citi side, the Citi's general fund doesn't carry any debt. It it has an events to the water enterprise, but the general fund doesn't carry any debt.

So the but the the water enterprise, as I understand it, took a loan from the general fund. Correct?

3,800,000.

Yeah. Yeah.

Okay.

Okay.

And to answer your second question on the TOT, so far in 2526 on a quarter to quarter basis, the TOT has been trending up compared to last fiscal year.

Right.

Thank you.

We'll pick up baseline expectations here in case anybody's interested. I've seen a lot of glossed over eyes out there, but this is a workshop. We're not actually adopting a budget tonight. Anybody's watching online. We're asking questions. This will come back to us in June for an adoption of an actual budget. So the discussion we have tonight is to sort of shape the final budget that we'll be adopting later. Mayor Protepp.

Director King, thank you very much again. Big effort to pull all these numbers together and to kind of put them in a format that can be digested and understood by everyone. The reason we do these budget workshops is transparency, right? Because I've said this before in the dais that this money is not our money. It's everyone's money.

And it behooves us to make sure that we're having these workshops and letting people know where those tax dollars are being spent. So a few questions. In looking at the revenues, they're growing. The general fund revenues are growing roughly at 8% to 10% year over year. So do you anticipate that the tax revenues, which represents about 40% of the general fund income, that they'll continue to grow at 8% to 10%. And then the other question I had is around grant funding, which I know is a sizable portion. Do we anticipate that there's going to be contraction in the grant funding from the Fed and also from the state, or do we see that continuing?

And so on the general fund revenue growth trend, if we break down the growth trend by specific categories and sales tax, we anticipate that to grow by about two to 3%. And that is the outlook is continuing at least into in the next two years. And property tax, we've been seeing a four to 5% growth. And because ownership change, valuation increases, and also new units and so forth. So those two largest categories is growing at about estimated pace.

And what is there are some in other categories in fees charges, it depending on development activities. And that is the building and permit building planning permit fees that changes, fluctuates as citywide developments changes. And some years, we might get more units applying for permits. Some years, we might get a little less.

Okay. And then the other question I had is you mentioned the our pension liability pay down, which I think was $7,000,000 And then when you take a look at the go forward years, for the next five years, we're looking at an 8,000,000 payment. So is there any reason why we don't consider that a recurring expense since, again, it's going to be ongoing for the next five years at $8,000,000 And then I think the last year is at $4,000,000

UAL is a little unique. It's a little different from the normal cost. So when we talk about normal cost people that happens every time we issue payroll checks. So that's the regular pension costs. That is considered operating costs. But UAL has an end date. So we know we expect to pay it off in five, six years. Because it's end date, it's very pretty soon. So we consider that as a non recurring. Once this is also part of as we are paying down more, we're realizing savings from it.

Okay. Alright. Thank you very much. Appreciate it.

Council member Gallagher.

Thank you for the presentation. I agree with the mayor. It is the best I've seen. We're always getting better. As you'll see later, I'm always looking for ways to improve. But it was a great presentation. My question is on the nonrecurring. I'm concerned that we might be putting too many items in the non recurring that really should belong in the recurring. And even though they don't occur every year, any normal city would anticipate them coming up, right? Like we have to, you know, our annual street maintenance, those types of things.

Are things that we are replacing every few years or we know they're coming up that I don't want to mischaracterize and keep putting stuff in non recurring because I think it creates some confusion because the question keeps coming up whether we take this from the legacy proceeds or we take it from the general fund. If we we can kind of better define and make sure we're not using that term loosely on the recurring. And so I guess my question is is that is there a are we determining whether some of these things are recurring? Is it is it is it kind of a grade you get to make the decision or is there something more constraining us?

So I think the most important criteria is it it's is this something that we need to continue to be paying as long as the city is off of services? And that's one very broad stroke to look at the categories. But we also look at the expenses such as exactly what they are funding. For instance, for for IT services. And so we have in the proposed budget, we have the departments gets charged for IT services.

And part of the IT services is to replace servers, equipments, network that's necessary. And so in the 2627 proposed budget, some of the increases in some of the IT charges that we actually broke out. What is what we consider replacement, one time replacement. And what's consider ongoing subscriptions and services and consultants that we need in order to deliver to do help desk to do network engineering.

But we replace a car every five to eight years?

This And

those show up in recurring. Right?

Those show up in re in recurring.

Yes. The servers every 10? Mhmm. So that's nonrecurring?

That is nonrecurring. Okay. Yes.

Yes. All right. Councilmember Fink.

Thank you, Mary. And just sort of as a point of order and procedure here, is this just time for questions? I know we will have public

General, yeah. Questions for staff to clarify the presentation.

Should there be time when, after that, would we have time to provide more input to staff?

Doctor. Absolutely.

Okay. I just wanted to make sure I'm bifurcating what my questions versus my comments. Okay. A couple of questions then. On one of the things that came up in the presentation, and this I didn't ask you yesterday, Jennifer, so I apologize.

And you may not have the answer at the ready, but we saw this big chunk of sales tax revenue, you know, as the biggest source of revenue. How much, and again, don't expect you to have this answer now, but I would like to know this, how much of that is sort of the the Amazon tax, if you will, the online sales tax that we get through a fairly complicated process, but where we're supposed to get the sales tax from from online orders as opposed to the brick and mortar here in the city? And I don't expect if you have that offhand, I would be impressed. But I don't expect you to have that. But if you could look into that and get back to us on that, I think that'd be interesting to know, especially as the world has changed over the last twenty years and particularly over the last six and as we're looking at more housing options and as retail is just different.

Could you just give us a a very brief description of the there were two big and I asked this of the city manager, so it might be the city manager or or the public works director about the the first street multimodal project and the Jamboree. You mentioned the Jamboree rehab project just because those are very big capital projects.

And if I may, director Grissel have more information.

Good evening. Appreciate the question. I'll try to tackle those one at a time. So is really, Jamboree Roadway Improvements is really that. It's a structural improvement of Jamboree from I-five North to Portola. So that's part of our goal to rehabilitate that roadway. We applied for a regional state grant, received $7,000,000 in grant funding to tackle that project. There is a local match, which is represented by the subsequent rest of the budget allocated. But that really does entail the grind, cap, overlay, sidewalk, concrete, all of the pieces that you would see in a typical roadway improvement project. So that's a pretty big undertaking for us.

These things come up regularly. These are ten year, fifteen year roadways where we need to tackle our major arterials. And this is an effort to tackle Jamboree. 1st Street Multimodal Plan is, in essence, a very similar initiative. Santa Ana is also looking at their 1st Street corridor.

It's an exciting opportunity for us to take a look at what 1st Street looks like today and how we might improve that in the future. So it's really a three phased approach for us to conceptually look at the current condition of 1st Street, do some design alternatives, and bring those into the community, to the stakeholders, and to the council, and really engage the community on kind of similar to an active transportation plan. This is specific for 1st Street. But look at ways for us to make it safe for pedestrian, bicyclists, and roadway vehicular traffic. That was also a grant funded project. We had $270,000 I believe, in grant funds and a local match of don't quote me, I can dig it up but about $50,000

And just to stick there for a second, because I have a quick follow-up on Jamboree. Two questions on it. One is, will that be, is that project just, we're just redoing the road as it exists now? Or is there going to be design and alternatives that go into that project? And the second part of that question, you might want to answer this together, is this in conjunction with the city of Irvine on the other side? Or are we just doing half the street? Or how does that work?

We own the majority of the roadway out there or have responsibilities for paving. So where appropriate, we will work with and partner with the city of Irvine. Very similarly, we've done that in recent paving projects on Myford and other areas where we have jurisdictional boundaries that cross. But the majority of that area falls into Tustin's jurisdictional responsibility. With every project, we always look for opportunities to improve.

The baseline answer is it's very consistent with what's out there, but we're always going to look for opportunities to look for striping. We always, you know, right now in the world of active transportation, bike movements, pedestrian access, this is all of the current and emerging engineering standards are being evaluated and we'll update that appropriately with that rehab project.

Couple just there's two other questions, and these aren't aren't necessarily for you, but might be Jennifer, might be the city manager. Great job. You know, he's I mean, I don't wanna take away the the the microphone from you. I just think they might be directed elsewhere. But one question is the slide 31 talked about the UAL payoff, the $4,000,000 a year that we had been doing.

And we talked about this a couple months ago, not continuing to pay that forward. But this there's a $4,000,000 that we won't have that we won't have going out the door this coming year and in the out years as projected, is there some place where we can say, hey, we are now spending that $4,000,000 that we can point to?

So the way that those pre funding worked, were paid, they were budgeted under legacy fund. And so if we there's no future budget for those payments and what's not being spent, it rolls into the legacy funds available fund balance for other projects.

Okay. And then the last question I have for now is I attended, I think most folks attended one of the, you know, the Tesla legacy workshops not last week, two weeks ago. And one of the pieces of information out there was costs for various rehab of the North, excuse me, of the South Hangar. North Hangar's a whole different deal. But costs for rehab for the South Hangar.

Is there a CIP project for that? Is there anything in our budget materials now that starts plan you know, the CIP includes plans that are TBD on date and money. Is there anything in the proposal now that's got a project to do those rehab that rehab work?

Currently, it's not listed in the seven year CIP and that's pending council direction.

Okay. Thank you. That's all the questions I

have for now. Thank you. Any other questions before I get public comment? Thank you, Jennifer. We're to open public input for this item. If any members of the public wish to address the council, please submit a request to speak for participating through Zoom, please raise your hand. Madam city clerk, any request to speak?

No, mister mayor.

After all that. Okay. We're gonna close public input and bring it back for discussion. And I wanna start off by kind of framing this. It is a workshop. And I think overall, Tustin's budget is a good news story. We have ample funds to pay for a lot of things, paying down our unfunded pension liability, doing CIP projects that we need to do, improving roads, hiring more police. A lot of the cities in Orange County and throughout the state are not in the position that we are. And so we should start by saying, this is a good news item. We're very fortunate that we're up here talking about how do we want to spend our money and do we want to save money for other things.

And we have reserves above our policy. And we're doing a lot of things that are long time coming, thanks to past counsel direction and policy and staff also tightening the belt on expenses and alleviate some of those funds. So thank you to staff and then the community and past council for setting the stage for these options that we have. To your point, Lee, earlier, council member Fink, about the 4,000,000 in funding on the UAL pay down. We're currently funding, to Director King's point, voluntary pay down of unfunded pension liability from the legacy account.

I think, Councilmember Gallagher, this is what you were kind of alluding to, we've got to stop doing that. I mean, some point, we have to stop siphoning away from legacy proceeds for things like this. I think the UAL is a good policy, however 7,000,008 million dollars a year, as you mentioned to take from the legacy to pay that down. And it will alleviate funds in the future. But for the one time wish list items, I would like to see and I think we're moving in this direction.

But I would like to see us moving them all over to operational expenses and not one time expenses to the maximum extent possible. So we see what the real budget is. We have one time revenues, grant funding. If we get grant funding for a project, let's do it all day. But if it's from the legacy account, I think this council really needs to pay super close attention to what are we paying for and what are we giving up by paying for something that's not then going to go into a legacy project, right? So we've got I don't even want to throw a number out there because staff might fall off the trip. We've a big number for potential Southanger deconstruction. We've got a big number for potential moving of the municipal center out to the parcelization. These are hundreds of millions of dollars. And so we need to make sure that we have that in ten or fifteen years.

And each time we sort of chip away from the legacy land sale proceeds account, we're not keeping our eye on the long term. And that's on us and staff and partnership. I think we're all aligned. I just want to get that out there, that good news story. We've got a lot of opportunity moving forward. But we really need to keep our eye on how we're spending this money now so we have enough in the future. Okay. With that, we're not adopting a budget. We're just giving feedback. Councilmember Carter.

All right. Yeah.

That was I made some notes. The headline is everything is good. Right? I mean, we've got the money. We're hiring police. We're prioritizing safety. We're prioritizing quality of life through our parks and other improvements. Our roads are good. So we're we're doing everything good. So now we can focus in on where we agree on where we can improve. And and I think I'm gonna kinda piggyback off what the mayor said because because I do agree. But I do want to answer directly. You asked for fee books, so I'm going to give that first. So option you said option I'm calling them option one or two. That was the order.

Don't think they were labeled that way. But I think option two, which is where the reserve is drawn down towards our just above our target, the upper threshold of our target at 21%. This is typical. So most agencies do have projects that come up every few years, and if it's a big project, you build up your reserves and then you draw them down. That's what you do. That's what we do at OCCAN. I'm sure that's what you do at your other organizations. That's just how it works. And I think I'd like us to keep moving in that direction where we're looking at these ten year timelines and we're looking at the reserves go up as we're anticipating larger projects and we watch them draw down. That's how we would normally operate if we didn't have the secret piggy bank account, which we call the land sale proceeds.

So I would recommend option two because that's in line with typical practice. On the general plan, this is an item that we've talked about since I've been on council. Typical practice every twenty to twenty five years, you want to update your general plan. I understand this is something we want to proceed. I'm very concerned about what this is going to do to our staff time given the major focus we need to be having on the Tustin legacy to unlock that value.

And so just wanna make sure when we come back that we know it's not a million dollars, right, that's one year. What is the actual cost of that? I just want us to be I want the staff to be able to put a budget forward because there's gonna be workshops, there's gonna be outreach, there's gonna be all sorts of components. And I just want there to be some accountability. This is what it's gonna cost, this when it's gonna get done, and then that we stick to that.

And if that budget needs to include additional staff augmentation to help implement so that we're not drawing resources away from higher priority top issues. I just want to make sure that that's thought through and planned for accordingly. The last item which I do think is the most important, and get ready for those of you that have sat through these before with me. I say it every year, but I think this is going to be the year we change it. So you saw on there, we're pulling from the legacy land sale proceeds at somewhere in the tune of $14,000,000.

And every year I say, well, what are we giving up to to pay for this? Where is the budgeting that says we are going to have enough at the end of the day to do all the other things we've talked about? And the answer is over the years, this has progressed. I think we can say now with where we are on the outreach we're doing, the planning that we're doing at the Tustin Legacy that I think and this is this is gonna be my ask to staff is that you guys come back and confirm this. But I think we can set a goal, but by the end of the year, we are going to have some high level budget so that in future years when we come back and are asked, we're pulling this money out of land sale proceeds.

I wanna see the number go down from one of those categories. One of those categories that we said we're building a nicer park, we're building a nicer bridge, we're doing a civic center, we're doing something that the community wants. I wanna see that number go down and so that we can make the decision. Because right now what we're doing is we're saying yes or no, do we want, do we like this thing without understanding what the consequence is. And so I don't think we're in dire straits, but I'd rather us get this in place now so that we can maybe that second step is a policy around this so that we can secure the financial future of our community.

I just think this is I've seen it progress more and more since I've been on council, and I think we just gotta rein it in, get under control, and set a clear program for future councils. Alright. That's the end of my monologue.

You sure? Yeah. Council member Nielsen, and then I'll

So just to piggyback on what councilman Gallagher was saying. You know, having been on council before and going through the different gyrations of plans and and development at the legacies since, I think, I started planning commission 2002. So long time. You know, we haven't we've had these plans that are kinda neighborhood by neighborhood kind of in general, and we're looking at them and we're you know? And now we've accelerated that, which is wonderful.

We're doing multiple projects now instead of one project at a time in in in the neighborhood. But the one thing that and I know this is very tough to do, but the one thing is that we don't do long term projections. And to piggyback on you on budgets for what, you know, what we believe through modeling is going to be, you know, land sale revenues as we progress and basically developing the legacy and what those expenses might be. I mean, we could do modeling simulations of this to give us an idea as we move forward over the next number of years as we progress what's that what that's gonna look like. I mean, we know what it's gonna look like probably two years from now, three years from now, but I'm talking more in the future.

So that kinda plays into securing the financial future of the city and what we do for the legacy. So that gives us more information to be able to work through these things to understand what we need to spend and what we need to save on. So, anyway, that that would be my suggestion. I know it's a it's a heavy lift. I know it's a big ask, but I think in the long run, it's going to save us a lot of grief.

As far as my opinion on on the reserve, I think if we if we keep down to 20%, 21%, which I think is option two, I think that's probably the best way to go in the short term. So, anyway but I like that idea of having kind of a a separate issue where we're looking at budget and long term budgeting for the legacy so we know what we're getting into.

Council member Fink.

Thank you, mayor. I hate to agree with council member Gallagher for the second time tonight, but I do. But I think that's a really and I think that timeline that you put on it is important to sort of frame out what those backbone costs, infrastructure costs are going to be over the long and it's going to be a long term situation. So these things will evolve over time. But we're sort of shooting in the dark right now.

So if we could get that budget in place, it will be a working budget. It will be one that will have to be manipulated and molded over probably a couple of years. But to start to have that in place so we know, hey, is the I think we have a 118,000,000 in the land sale funds at the end of this year. Do we need a 118, you know, if we project that out with future sales? Is that the right number? Or are we 40,000,000 short? Or are we 40,000,000 over? So I I agree with you completely on that. So let's let's try to do that. Let me suggest also that there's a small piece of this.

And could could you pull up slide 13 on this? Because this is the option one, option two, recurring, nonrecurring. I I want to just address this for a second. So and I guess 14 is the other side, the other option of this. And I mentioned this when I in briefings yesterday, but this isn't called out specifically in the in the budget document that we've got.

It's sort of buried into these parts. And this is, in some ways, the biggest sort of weird nonrecurring piece that gets put into the general fund. And it strikes me that these items should be treated like the CIP projects. Right? We're funding them not from they're not recurring. I think council member Snell has a good question about is the UAL recurring or nonrecurring? And I guess I'd think it's nonrecurring because it's supposed to end, but, like, I get it. That's a good question. But these are the ones that are year to year going to change. We'll do the general plan in a year or two.

The temporary emergency shelter might actually be a recurring one, but there's policy decisions to be made. The capital the police capital IT projects I can see all the way here. Don't know what will come. But I think that we should treat these like CIP projects and put them into we could put it into the CIP or something else, but put it where we're laying out in the budget like we do the CIP projects. And I think we should also plan to just what I think other agencies do is is plan to dedicate a portion of our general fund dollars directly to our CIP or our nonrecurring plans every year.

We're not there yet because we're not in that tenth year of the fiscal sustainability piece that we, you know, are getting to. But every year, we should be expecting to put a little bit into those long terms that's that's added with grants and other money that we've got. And if we did that and we were at that ten year fiscal sustainability, we would say, hey. There's a police capital IT project and a general plan update that we wanna do this year that we've got dedicated money for those nonrecurring things. So I think we should capture it like that.

I think that's sort of a very small piece of capturing the long term things that other council members are talking about. I also want to say, I understand, Mayor, what you're saying about the UAL and that we're paying it out of the land sale fund. And we should another reason why you ought to be doing what council member Gallagher is is knowing what we're what we're gonna have to spend long term and what we're gonna come in long term as best as we can. But my concern, and I think it was a concern expressed by others when we discussed the UAL, is we don't want that money to just be, well, we've got $4,000,000 extra. And what I've suggested is we we say, look.

Here's the $4,000,000 that we're using. And I've suggested we put it into something where we reinvest, and we will get that money back in in ways that we you know, council member Nielsen mentioned that the the water enterprise borrowed $3,800,000 from the general fund. There are ways that we and I know the city manager's looking into this on other ways of paying interest. But there's ways that we can use our own funds internally, you know, perhaps kind of like, a little bit like redevelopment dollars were used, and lend them be able to use those to reinvest in the community to do things that will eventually bring that money back to the city's coffers as well as create long term growth. So I've mentioned a couple of things in the past, whether it's helping to pay for what would have been in the old days of redevelopment, redevelopment projects, whether it's buying the Bel Air Motel or redeveloping that and so it's not that polite, or whether it's helping businesses in Old Town or in other parts of the city in ways that we could otherwise.

And we could also then point that to, this is what we're doing with the $4,000,000 for the next five years. And it's going to come back to us, too, ultimately. The last thing I want to say is I think it's really important. We've got $75,000 set aside for matching funds for active transportation plan. And we've got nine what's the number?

I wrote it down. $19,000,000 in street projects in our capital improvement project this year has 28% of our CIP. And it would be a larger percent of our CIP in a normal year if the legacy were fully built out or in another city that wasn't doing so much in the legacy. It's a huge amount. What an active transportation plan would do is every time we do, whether it's Jamboree, whether it's 1st Street Multimodal, whether it's even our annual street maintenance repairs, is it puts into our planning and development process how we deal with bicycles, pedestrian, mobility devices, all the stuff we talked that we've started regulating today too.

And there's huge amounts. I think some of the folks from vibrant neighborhoods talked about this at the last meeting. There's huge amounts of grants that that could unlock to do more of that. So while 1st Street multimodal is great, it's a chance to kind of do some active transportation planning along 1st Street. The active transportation plan is something that would integrate all of those plans, whether it's 1st Street, Jamboree, and interconnect those as one plan, and then always have a planning document that we go back and look at to do.

So I'd suggest that we're hoping to get this grant from OCTA, is it, Randall? OCTA. But I would suggest that whether or not we get the grant, we put aside the extra $400,000 to do that because we can unlock a whole lot of money. And we wanna do this before we keep doing big road projects because we miss those opportunities to do it. Last point I'll make.

I'm glad we're doing a new general plan. I've talked a lot about a strategic plan. I think that we should probably marry those two up because certainly in the short term, the general plan can we've got a five year strategic plan from 2018, and it's becoming increasingly misnamed as a five year plan. But the general plan is the opportunity to put all of that together. So I would just suggest that we include that in the process. And I think it's the same money project timeline, at least for the short term. General plan's a lot longer, but for the next five years, it'll be the right thing. That's all I've got for tonight, Mayor. And I do thank the staff throughout the city for putting this all together.

Thank you. Mayor Pro Tem?

Thank you. I'll keep the comments brief. I just wanna bring it back to the beginning with the mayor saying, look, this is a good news story. A lot of cities would would be would love to be in the position that that we have. We have an abundance of riches.

And we've got the Tustin legacy, which that alone is in excess of probably $1,000,000,000 in value. But I do agree with my fellow council members and the mayor. We need to be very judicious about how we spend that money because that piggy bank is eventually going to run dry. And I think a North Star that we should all focus on is that our general fund and our continuing expenses should be funded by recurring revenues as opposed to dipping into our land proceeds and borrowing from Peter to pay Paul. So, and again, I think we're all in line with that.

But I do believe there are sometimes nonrecurring expenses that would merit having to take money out of the land proceeds sales and pay for those, one of those being the new cameras for the police when it comes to public safety. Again, I think there are opportunities where it makes sense to pull from the legacy fund. I do agree that we should be looking at doing a general plan update. I think the last full general plan update was done twenty years ago. And that is going to be directive and indicative of what the CIPs are going to be.

And I think, to Councilmember Gallacher's point, that it's going to be really important to understand, not in five years, not in ten years, fifteen years, and going out, all the expenses to build out the infrastructure in the Tustin legacy and how much value we're going to be able to extract to ensure that we've got enough money from land proceeds sales to actually fund that development to build out the legacy, which will generate lots of tax revenue, do all the wonderful things that we all love in this city. The other thing I'll say is when you take a look at the pie of all the revenue and how it's generated, one thing that I don't see on there, I think we should start exploring that, is public private partnerships. And public private partnerships are a way to create an annuity. So, know, again, as we go through the general fund plan update, I think we should look for opportunities selectively where it makes sense to do public private partnerships, again, which will generate, you know, an endless amount of revenue for the city. So that concludes my comments, Mr.

Mayor.

Thank you. Can you bring up slide 14, please, whoever has the toggle? Thank you. So I've heard comments from all the council members, but I'm in support of being consistent with the already adopted policy of reserve level between 1520%. If we have excess funds above that 20% to use that for nonrecurring or other uses, there's no reason to have 25% reserve and then also to pull from the legacy.

That's my opinion, and I've also heard that from others up here as well. So I'd like to move to that model. I think I I don't think. I do support councilmember Gallagher's request, and I think it's council direction at this point to develop a model. I know staff has been working on it. And we're just kind of foot stomping the fact that we really want to get it done. So thank you for the work so far. There are council direction on certain projects like the Southanger. What are we going do with that? That'll feed into that model. But I really do think it's going to be instructive and valuable in our forecasting effort to get that thing done. We just gotta get something off on paper, so to speak, and and move toward it. I don't have anything else. Any comments? Looking forward to the actual budget coming back in June.

We don't need a motion. Right, David? We're taking just

That's correct.

Feedback in general. Yeah. Okay. Thank you. Thank you, Jennifer. Thank you, staff. All right. We're going to move on to other business. Mr. City Manager, do you have a report tonight?

Yes, mayor. Thank you. Sticking to the theme of budgets, the state of California is entering a critical path regarding their budget phase as well. There's some major funding decisions that are expected to be coming in the next weeks. We're tracking our opportunities to apply for state earmarks. So we'll continue to keep the council updated on our progress so that we can bring in more funding for our community. Also, our police officer, Lauren Tharp, has been nominated to receive the Mothers Against Drunk Driving Award for 15 DUI arrests in 2025. So we're really proud of her efforts. Those are my updates.

Thank you, Alda. Mister city attorney, do you have a report?

No further report this evening.

Alright. Thank you, David. Bring it back to the council for our reports. Council member Nielsen.

Thank you, mister mayor. Just a few things here. April 22, it was a privilege and an honor to attend the ribbon cutting for the new fleet services group for Tustin Buick GMC at our our auto mall. It was very nice to see that we're still expanding and very grateful for the auto center in Tustin, the amount of sales tax they supply us by selling all those beautiful new cars and used cars and now fleet services. So it's wonderful. So anyway, it was a very nice event. And I had a couple of my colleagues, Councilman Fink and council or I'm sorry, Mayor Pro Tem.

I did get her right. Mayor Pro Tem.

Yeah. That's right. Yeah. Otherwise, I'll hear it later. Anyway, on also on April 22, attended the first of the two legacy workshops, and it was really nice to have a lot of input from residents. They're very enthusiastic. The video was wonderful, I'm assuming we got it up on the website now and so people can see it. So if you have a chance out there, if you wanna take a look at what's going on in the legacy and understand what's happening with the hangars, then it's a good video to use. So take a look. Get on our website and take a look at it.

Again, I attended the the second of two workshops on the twenty third as well. So I wanna thank all the staff members that participated in that and actually helped the the residents kind of answer questions for them and take care of some of their suggestions and everything else. So thank everybody very much for that. And then April 28, participated as a board member of the Tustin Area Senior Center Fund meeting where we discussed several items. But, the big thing is if you haven't been to the senior center lady lately, you need to go.

They have some, beautiful new flooring, beautiful new desk. And if you love bingo, come to senior center bingo as well. So it's a it's a great fundraiser for the center. So, anyway, that is all I have. Wait. Wait. Wait. Hold on. And, also, last but not least, on the thirtieth, I attended the Tustin Police Foundation Awards Banquet, which was great. Thank you to the, the the foundation and to everyone involved, chief, and all the command staff and patrol officers that were there.

Very well attended at even house, and it was a great event. Enjoyed it very much. And seeing everybody that got awards there, and it's nice to see that we have still have the best police department in Orange County. So that was wonderful. That's all I have for tonight, mister mayor.

Thank you. Council member Fink.

Thank you, mayor. I just wanna start with thanks to our parks team. Somebody reported to me that home plate at Pepper Tree Park was had been pulled up and was all janky and dangerous. And they went in, got it fixed. And so Pepper Tree Park is safe for baseball, softball, and anything else like that once again.

I attended the library advisory board meeting on Thursday, April 23 excuse me, the library advisory board executive committee meeting, which focuses on the annual budget for the county public library. The county public library's budget is actually in very good shape, in large part because ironically, the exit of the city of Irvine from the county library system, about half of the $18,000,000 a year or so that goes to libraries from property tax directly stayed with the county system. But it cost the county about $13,500,000 to operate the Irvine Library. So there's extra money. The staff, that transition is pretty much completed now.

Staff in the county library system have sort of sorted out. They had left a lot of open positions in the county library system to absorb people who had been working in the Irvine libraries. Some folks stayed in Irvine, some folks went to different places, And some folks stayed in the county system and moved all around. We're still sort of tracking how that's having a long term impact on our libraries in the county system. But the budget is in good shape.

And good news for the city of Tustin. And thanks to the Parks and Public Works folks again that we're working on a vending machine. It's now on order. And it's going to be a library vending machine placed at Veterans Sports Park, which is going to be an opportunity to check out and even potentially return books right at the sports park. And it might be a model for other places where there's outside kind of library space.

So some good news there. I'd also attended the legacy workshop on Wednesday. I guess that was the twenty second. I wasn't able to attend on the twenty third because I teach it was my last class at Western State for the the term. But attended the library workshop on the twenty third, and I appreciate the effort that went into that, the folks that showed up from throughout the community.

And I would just say to folks who are over here, tell us what you think we should do with the, you know, the that last part of the legacy that we're working on, what we should do with the North Hangar Site, what we should do with the South Hangar Site. There's a lot of ideas and concepts that are out there and floated. But it is also up to you to tell us what you think of. So if you can imagine just a white piece of paper that you have ideas for, add those to the mix at future workshops, at surveys, even here at the microphone at the future land local reuse authority. But even before that is better because we want to get those ideas.

I missed out on most of the city events last week, all of the city events last week, because I was actually in New York City on vacation. And just one of the things that was really notable to me and I've lived there for law school. But as we wandered through Central Park and walked the High Line, which Councilmember Schnell had suggested, is just how much open space there is in Manhattan. In the most densely crowded area, at least of The United States, there are huge swaths of open space that are creative, differently used. And there's a lot that can inform what we do in the Tustin legacy even if there are large structures right next to that.

You know, that Central Park is looking over 40 story high rises. So we can do that. And the High Line is a really great concept for the linear park. There's a lot there that we should sort of take lessons from as we develop that. Last note is well, two notes.

I'll I'll be having office hours on Friday, May 15 at the library from three to 5PM. So if anybody's got anything they wanna talk about, come to that. And the last thing, city manager said as long as we're on budgets. And it just reminded me of something. As we're talking about the hangar itself, I saw in the news that the federal Department of Defense is asking for $50.52000000 dollars to rebrand as the Department of War.

And I think we should try to make an effort to go and say, don't rebrand. Give us some of that money to refurb the hangar. We we don't need that money as a country to rebrand, but Tustin needs that money to do something with our hangar. I think it'd be a much better use of our our dollars. And if we could go after our legislative delegation to help us with that, it'd be helpful. Thanks.

Alright. Thank you. Councilmember Gallagher.

Two quick items. I attended the workshop. Wow. Great job. It was a you were I think you were the head of the party planning committee. It was awesome. There were sandwiches, drinks. I think I saw most of you guys there engaging. It it was very I mean, this is a huge effort, and I know it's a lot of work for staff to attend those. And you guys got the Goodyear blimp pilot, so I peppered with all sorts of wild questions. Super interesting. But everyone did a great job. Really excited to see the consolidated feedback. And then the second one was it is the it is the National Day of Prayer on Thursday. It's the first Thursday of May of every year. It was created in 1952, which means this is the three hundred and fiftieth anniversary. Don't check my math.

That's a good job.

It's a

big deal.

So if you haven't prayed in a while, never prayed at all, think about it on Thursday. You can pray for peace and our city. I will be doing that. So that's it.

Thank you. Mayor Pro Tem.

Appreciate it. On fourtwenty two, I also attended the legacy workshop. And I was going say, Nicole, the video, amazing. Again, the food, the engagement. JPW did a wonderful job. And, you know, the one thing we talk about transparency. You know, we do these workshops not to be a dog and pony show. We do because we generally want to engage with the community and hear their feedback. And I see that William Johnson's in the back, brought his fiancee. And we had a conversation.

And I walked him over to JPW. And they had a conversation about maybe better ways that we can engage and find people where they're at. Because, again, we want to hear that feedback because this is all of our city. So again, I hope when you attend these events, you get value out of them and you understand that we're really genuinely there to listen and to take that feedback apart and modify our plans accordingly. On 04/23, I attended coffee with a cop at a very, very nice McDonald's off of Red Hill, and I actually met Grimace. And does anyone know what Grimace actually is?

Dinosaur.

No. He's not a dinosaur. He's a taste bud.

I thought he was

I did not know that Grimace is a taste bud. So anyway, guess, delicious food. Remember, they had coffee. They were very gracious. What's that?

Fake news.

It's not fake news. He is. He's look it up. Google it. Chat GPT it. Grimace is a taste bud. And the chief was there. So it was good. It was a great time. And the owner of that McDonald's was very gracious, was giving free food and coffee. So it was really a fun event. On actually, tomorrow, I'm gonna be attending the OC Business Council's health care forum. It's the fourth year that I've attended it. All the the the top executives from Orange County's largest hospitals and health care systems will discuss kind of the innovations that are affecting the industry. It's definitely time well spent, and it's good to have connections to those folks who maybe someone may want to spend some money and build out in the legacy.

And then last but not least, I thought you were going to mention something, Councilmember Gallery, but today is Cinco de Mayo. So I want to wish everyone a happy Cinco de Mayo, but a little history. And I did not know this. Everyone thinks Cinco de Mayo is about margaritas and maybe beer and great Mexican food. But the history of Cinco de Mayo, it commemorates the Mexican army's unlikely victory over French forces at the Battle of Puebla on 05/05/1862 and became a symbol of resistance and national unity.

So those celebrations in The US began in '62 and '63 1862 and 1863 in California. And Mexican Americans in the Southwest held these early celebrations as a show of solidarity against French intervention in Mexico and to celebrate their cultural heritage. And that celebration of cultural heritage continues today. So happy Cinco de Mayo. And last but not least, my daughter's not watching, but I have a 16 year old daughter who passed her driving test today. I will probably get some more gray hairs. Ava, congratulations if you're watching on getting your license. And that concludes my comments.

Thank you. I also attended the April 22 Legacy workshop. Thank you to staff, Nicole, Erica, your team, and all the staff that showed up. We noticed as a council when you take time out of your evening to engage with our community. And we were all there as well. But that's unique, I think, to Dustin. Not a lot of city employees would just show up want to engage with and answer hard questions. So thank you to everyone who showed up and participated in that. Job well done. On April 23, attended the OCFA board meeting where we talked about budget just like we did tonight.

And OCFA is in really good shape thanks to some forward thinking on pension pay down, just like Tustin is doing. So grateful to have a partnership with the OCFA agency. On April 29, the Tustin Community Foundation nonprofit interfaith meeting where we had Stephanie Ensen, our our Tustin library branch manager, come and present all the programming that's available during the summer events. I know council member Fink talks about that a lot. But right outside our doors here at the Tustin library, which is it used to be at least the second most visited library in the county. Is it number one now? So the most popular library in county system. On April 30, I also attended the Tustin Police Award Banquet. Really good job. Thank you for inviting us.

Councilmember Nielsen and I sat with command staff. And the Tustin Police Officer Association president, current president Beck Spensen, I think summed up the way I feel. I think our council feel and I think staff feel. And he said, you know, while a lot of people thank Tustin PD for the service, they're really grateful to be able to serve the Tustin community. And that says a lot about the people in our city and why we all show up to work to serve you. And I just really appreciated that comment that he made. Okay. So upcoming some events, and then we'll adjourn. Summer class registration, priority registration for Tustin residents begins on Wednesday, May 6 at 5AM. Registration opens to nonresidents on Friday, May 8 at 07:30AM.

So if you're a Tustin resident and you wanna register for a class, 5AM, May 6. We also have the third annual Tustin historic preservation week. Various events will take place. We had a presentation on it earlier tonight. But various events will take place Saturday, May 16 through Saturday, May 23. Visit testonca.org/historicpreservationweek for details. And we have a save the date for the Sunset Market, which is back this month, every third Thursday of the month, May 21 through September 17 in Old Town, five to 08:30PM on the third Thursdays of the month for the next five months. With that, we will adjourn. The next meeting is scheduled for Tuesday, 05/19/2026 for the closed session meeting at 04:30PM and the regular business meeting at 6PM. Thank you. Have a good night.