well welcome again to the Mesa city council meeting for January the 9th 2023. I will note that all of our council is present with the exception of Mr Freeman who is unable to attend tonight and is excused we will begin our meeting this evening with an invocation offered by Pastor Jeremy gills of the Mesa Church of Christ followed by the Pledge of Allegiance so please stand for the prayer and remain standing for the Pledge of Allegiance let's pray father God thank you for being with us thank you for prepping us thank you for giving us this opportunity to serve and so God in this Gathering we ask that you protect our hearts in this Gathering we add that we ask that you provide gentleness to our tongues in this Gathering finally God we ask that you preserve our minds thank you for doing this for us in advance in his name amen amen thank you join me in the pledge of the United States and to the Republic for which it stands one nation under God indivisible with liberty and justice for all right thank you very much the first item on our agenda is Awards and recognitions we will begin with an anti-human trafficking month Proclamation a council member spilsbury you're taking the lead on this so please tell us what we need to know okay thank you I am honored to be able to present this proclamation in our city this is so important that we're joining in with a huge Coalition of cities across the valley and I also am proud to continue the efforts that have been made by council member Thompson previously and continuing this great work and important work human trafficking is a global plague that impacts millions of people each year including tens of thousands of Americans the United States ranks as one of the worst countries globally for human trafficking and Arizona ranks in the top 15 states with the highest rates of human trafficking per capita human trafficking impacts people across all demographics and ages including teenagers and children the battle against human trafficking includes supporting efforts in schools churches non-profits law enforcement and businesses to prevent human trafficking can intervene disrupt and dismantle human trafficking syndicates and provide resources to and support for victims of human trafficking the city of Mesa joins schools churches non-profit organizations law enforcement federal and state coalitions and the not in our city.org movement in our commitment to increase public awareness of the human trafficking epidemic that impacts our community State nation and world and we have some special guests here tonight and I want to First invite Sergeant Lee who is the sergeant of our human exploitation and trafficking unit for the city of Mesa to come up and talk about the efforts the city of Mesa has been doing and then council members got September with Gilbert will also say a few words foreign good afternoon it's great to be here thank you for the invitation human trafficking obviously is a major issue here in the Phoenix Metro area it is January it's uh human trafficking Awareness Month my name is Joshua Lee I am the police Sergeant over the human trafficking unit here in Mesa I have two detectives assigned to me one civilian investigator and one Homeland Security special agent that's in our unit we're small in numbers but yet highly effective and Powerful in what we what we can accomplish for that reason we're actually known as one of the leaders in human trafficking investigations in the state of Arizona which is one of the reasons why we're called to help other agencies throughout this state since we're small in numbers we rely heavily on the the surrounding areas to help with our investigation so here in Maricopa County we work together as a as a team excuse me um during the during the course of 2021 to 2022 we've actually completed 13 large-scale investigations arresting hundreds of suspects saving countless victims of human trafficking are if you're aware we have a very large scale event the Super Bowl is coming to town next month the Super Bowl is actually the largest human trafficking event in America with that said any large event will bring in human traffickers but it just happens to be we have the trifecta of human trafficking coming to the valley and that's the Barrett-Jackson the Phoenix Open and the Super Bowl all all in the same time frame so yes we will get an influx of criminal activity and human traffickers during that time but we've been preparing for about a year doing these large-scale operations so some of our operations we target the buyers of actual people we go after those that are buying people some of our operations are more around the traffickers the people that are actually trafficking our victims and some of our operations we go after the victims themselves to help them and give them the resources that they need to escape the invisible chains that actually bind them to this lifestyle so we really use a lot of different approaches in our operations here in Mesa the human trafficking unit we have a two-prong approach to what we do obviously the first one is enforcement criminal enforcement is very important in what we do so that's where the operations come in into play the second or education just as important often overlooked but that's what that's what we need more of is the actual education we go out to our communities we educate our schools we go to our churches our non-profit organizations we go out anybody that's willing to listen we go out and we teach them what we know about human trafficking so that they can understand what human trafficking is what it isn't how to recognize it and more importantly what to do when they actually do recognize it um lastly we do educate our our police officers human trafficking victims are often underlooked officers are are out and about with the community members and might come across the victim and not even know it that's obviously an issue so we spend time with our officers and explain exactly what to do when they come across a victim we're very victim centered victim oriented here in the city of Mesa which is one of the reasons why we're so successful in what we do um lastly we can't do it without the support of our city council our mayor's office and more importantly our citizens this job is is very difficult emotionally physically spiritually sometimes so we really do rely heavily on the the support of our community so knowing that we have the support of the mayor's office especially with this Proclamation it really does mean a lot to us not only in in the human trafficking unit but us as in general as as police officers so I like to thank everybody for their time thank you mayor council my name is Scott September I'm a council member for the town of Gilbert and I want to thank you for making this Proclamation I think it's important that every city can make this Proclamation there are many things that divide that divide us and this is something that we can all stand behind together arm and arm and say no more tonight we have a couple people here we have a council member Mark Stewart from the city of Chandler and we also have Terry and Judith Crist from City of Grace here in Mesa and then we also have Pastor Mike gallons who is the founder of night of Hope and he's going to make a brief statement pastor um thank you mayor and and council members for this Proclamation and um you know we're as a church community and leaders trying to Rally together to support um against this fight and so we have been hosting and you have been participating as well over the last four years for a night of Hope and knowing the Super Bowl's coming here we felt like we need to take this Valley Wide and so February the 10th two nights before the Super Bowl we're having an event that you're all personally invited hope that you can attend along with we have dozens of NFL football players um going to be a part of that event and our Frontline Ministries and organizations law enforcement elected officials will will be there as well as we're believing for over a hundred churches to participate that night and uh so we would love to invite you to be there and and and the Mesa City community and and thank you again for just your bold Proclamation that not in our city well the thank you pastors and uh and council members we so it's our honor to join with you regionally to do this we do have a proclamation we'd like to share with you so why don't we all Gather in front of the podium and take a photograph of commemorating that um you bet Julie you want to stand right here all right balanced all right thank you very much [Applause] and looking back thank you the next item on our agenda is the selection of our vice mayor Ms Mosley have there been any requests to speak from the public on this agenda item Northwest mayor thank you uh would any council members like to make a motion council member Heredia to vice mayor thank you very much is there a second I'll second it thank you we have a motion and a second of to select council member Francisco Heredia as vice mayor uh please cast your vote are we on it does if anybody hit the buttons let me restart oh try the motion again please uh Jen would you make the motion electronically oh no a little bit of a delay but it came up all right and then there you go yeah okay thank you all right that motion passage unanimously with my council member Freeman uh absent uh let me just add my congratulations uh it's been really an honor to work with the council member uh Francisco Heredia now vice mayor uh Heredia for the last several years he's really just been a model of community service and uh Francisco thank you for your family uh the dedication that they have I know your wife and your children are all very engaged in what you do and we're excited to have you step up and and assume this new role anything you'd like to share with us yeah no just I want to thank my colleagues for entrusting uh on me uh this uh this role you know it's it's always a blessing and uh and uh a privilege to represent city of Mesa this great City that we live in uh with being on the council we have a lot of a lot of work to do we've been doing I think a a good job I think we can always do better in the issues that we we we it comes to our to our table and things like homelessness housing Transit transportation and many other issues I think we can always do better so my hope is to work and continue that work with my colleagues with City staff with residents and stakeholders to make this uh the city the best place to live work and play so I look forward to the role and uh and we'll be keeping uh working with everybody to ensure that we do this so thank you great thank you vice mayor heridia and I just want to add my thanks to councilmember Duff for her service the last two years as vice mayor she did an excellent job representing when called upon that represented our city extremely well in in a variety of situations so thank you very much for the you took that assignment very seriously did an excellent job thank you for your great service uh the next item on our agenda for this meeting is the consent agenda so we'd invite Mr Christopher to please come forward and read the consent agenda good evening mayor and council members these are the items on the consent agenda all items listed with an asterisk will be considered as a group by the city council and will be enacted with one motion there will be no separate discussion unless the council member or citizen request in which event the item will be removed from the consent agenda and considered as a separate item item three approval of minutes of previous meetings is written item 4A act on a liquor license application for Saint Timothy Roman Catholic parish one day event January 27 1730 West Guadalupe Road item 4B act on liquor license application for Village Grill and Patio 11061 East Medina Avenue item 4C acts on liquor license application for Creative dance Collective 2107 West Guadalupe Road item 4D act on liquor license application for Rosati zellsworth 1035 North Ellsworth Road item 5A approving use of Cooperative contract for the purchase and installation of six fire dispatch Furniture consoles for the Mesa fire and medical Department item 5B approving use of one portable chemical identifier for the Mesa fire and medical Department this purchase is Grant funded by the air Arizona Department of Homeland Security item 5c approving dollar limit increase in one year renewal of the term contract for tires for the materials and Supply Warehouse for the fleet services and Mesa fire and medical departments item 5D ratifying emergency purchase an establishment of a term contract with optional renewals using a Cooperative contract for the purchase of gasoline and diesel fuel for the Fleet Services Department item 5e awarding one additional vendor using a Cooperative contract for the term contract for a heavy duty truck construction industrial Fleet and equipment parts services and accessories for the Fleet Services Department item 5f approving a one-year term contract with four years of renewal options for air filters for the materials and Supply Warehouse for the parks recreation and Community facilities Department item 5G approving use of a Cooperative contract with an initial term of two years and three months with renewal options for the installation maintenance and repairs of outdoor sports Courts for the parks recreation and Community facilities Department item 5H proving use of a Cooperative contract for an initial term of 15 months and two years of renewal options for audio visual equipment accessories and services for various City departments item 5i approving use of a Cooperative contract for a two-year and nine month term contract for communications cabling systems for various City departments as requested by the department of innovation and Technology item 5j approving three-year lease renewal 2 3-year renewal options for the city's data center space for the Department of innovation and Technology item 5K approving three-year term contract with two years of renewal options through bio solids removal and reuse disposal services for the Water Resources Department item 5-0 proving purchase of auger and liner replacements for the bar screen conveyor system for the Water Resources Department item 5m approving use of a Cooperative contract for an initial term of 18 months and three years for new options for machine shops and related services for the Water Resources Department item five and approving doggo limit increase to the term contract for residential refuse and recycling containers for the Solid Waste Department item 5-0 approving one-year term contract of four years of renewal options for Traffic Control cabinets and controllers traffic signal video detection systems and school zone flasher controls for the transportation department item 5p approving three-year term contract with two years of renewal options for Traffic Control sign hardware and materials for the transportation department item 6A approving resolution modifying fees and charges for the business services department by adding a new fee for a short-term rental license item 6B approving resolution authorizing the city manager to enter into an intergovernmental agreement with Pinal County for an installation of a gas sleeve at the Queen Creek wash item 6C approving resolution extinguishing a 50-foot drainage easement and a 45-foot drainage easement generally located near the southwest corner of East Peterson Avenue and South 94th Place so we'll have a reconfiguration of both easements and accommodate future development item 6D improving resolution extinguishing a 20-foot water line easement located at 7722 East velocity way to allow for development of the property with two speculative industrial buildings item 7A approving ordinance for zoning case 21-80 for property located east of Higley Road on the south side of Thomas Road rezone with planned area development overlay Council these permanent and site plan review to allow for a boat and recreational vehicle storage facility item 7B approving resolution approving and authorizing city manager to enter into a development agreement with RNs Development Group on approximately 10 acres of land for property located east of Higley Road on the south side of Thomas Road item 8A introduction of ordinance for zoning case 22-429 for the property located east of Val Vista Drive and South Huber Street rezone to allow for single residence development automate B introduction of ordinance for zoning case 22-546 for property located south of Virginia Street on the west side of wrecker Road site plan modification and in many conditions of approval and Zoning case z07-118 this is to allow for a commercial development item 9A approving approving ordinance for annexation case 22-01048 to DNX the public right-of-way located within the 4200 to 4400 blocks of South Sussman road to Maricopa County this is subject to approval why the Maricopa County Board of Supervisors item 10A approving subdivision Platt replant of Heritage Village Assisted Living for property located south of Brown Road and East of 80th Street item 10B approving subdivision plant replied of Master Final plat Avalon Crossing development unit one for property generally located east of Crismon Road and south of Williams Field Road item 10c approving Subdivision plat Mesa Technology Park 2 for property generally located north of Elliott Road and West of Ellsworth Road and item 10d approving subdivision plant kitchen 202 Val Vista for property on the northwest corner of Thomas Road and Val Vista Drive mayor and council members these are the items on the consent agenda thank you Mr Christopher Ms Mosley do we have any requests to speak on an item that's on the consent agenda we do not have any requests all right thank you uh I note that Ms spilsbury has made a motion is there a second seconded by a council member Duff for approval of the consent agenda please vote thank you that passes unanimously with Mr Freeman uh being excused next item on our agenda is items 11a and 11b this is for the rezoning and development agreement for property generally located east of Higley Road and North of Baseline Road for the Baseline Logistics Park development the applicant has requested a continuance for both of these items to the January 23rd 2023 council meeting council member Summers has conflicted off these items and will not be participating or voting Ms Mosley do we have any requests to speak on this item no request mayor thank you do any council members wish to discuss this item is there a motion to continue both of these items to the January 23rd meeting thank you councilmember spilsbury is there a second thank you Mr iridia please vote all right the vote is uh unanimous with Mr Summers uh abstaining due to a conflict in Mr Freeman being absent to continue this item to the January 23rd meeting so if you are interested in this please come back two weeks from tonight and we'll have that vote next to item 12 is on our agenda is the city's annual comprehensive financial report and single audit report Ms Mosley do we have any requests to speak on this item I think you previously gave me a blue card is that correct yes mayor one request any okay thank you Mr Davis welcome invite you forward to speak on this agenda item good evening honorable mayor and city council my name is Carrie Davis I reside at 7963 East Plata Avenue I currently serve as the treasurer for legislative district 15. I want to congratulate you on receiving the certificate of achievement for excellence in financial reporting for the fiscal year ended 2021 and the completion of your June 30th 2022 year-end audit as reported on page 7 of the 2022 audit financial statements the unrestricted net position for governmental activities reflects a negative balance of 886 million dollars for an unfavorable impact of 44 million dollars over the prior year page 8 reflects total revenues for governmental activities of 842 million but total expenses of 897 million for a deficit of 55 million before transfers of 116 million from the business type utility funds since 2011 the city is overspent government activity revenues by 947 million dollars and transferred from the business type utility funds over 1.2 billion to offset governmental activity overspending page 13 of the report notes the total business type utility activity revenues increased by 44 million primarily related to increases in utility rates it seems to me if the city reduced overspending the governmental activities it would not need to overcharge utility customers to cover the deficit spending the current year budget for 2023 projects a general governmental fund deficit of 139 million approximately 60 million dollars of this projected deficit is due to increased labor expenses over the prior year the budget projects transferring 120 million from the Utility Fund to offset the deficit given the likelihood of an economic slowdown in 2023 is demonstrated by recently announced significant corporate layoffs it would seem prudent for the city to take proactive stance by reducing expenditures now my question for the Mayan city council is what is your strategy for reducing overall spending overspending governmental activity revenues in order to stop overburdening Mesa utility rate payers I hope you will forgive me for sounding like a broken record but as a Mesa resident I'm concerned about the long-term fiscal health of our community and I merely want to encourage prudent conservative Financial policies thank you for your time thank you Mr Davis uh next we'll have a presentation from our Auditor in City staff on this item Irma would you like to go uh are we going to have our auditor Ms kronstrom go first Council I'll have Sandy present first the results of our audit and the single audit and then I'll do a brief presentation on the results of our financial thank you good evening so 2022 was a busy year for the Auditors and the financial staff of your city the city implemented a very large accounting standard last year gasby statement number 87 related to leases we talked a little bit about this last year that it was it was on the horizon well it it's here and it was a pretty significant impact to city of Mesa the city of Mesa has a large number of lease agreements where the city is the lessor is Leasing Property a lot of it out at the airport those types of things that are now being recorded as receivables in your financial statements offset by what we call a deferred inflow of resources where it'll get recognized over time as that money is earned but it used to be that we just reported that as a footnote disclosure it was never booked in the financial statements itself um on our side as Auditors we had some pretty significant auditing standards that changed as well one of the things that you will notice if you looked at our Auditor's report is the the format has changed so our auditor our opinion is the first two paragraphs of the report where it used to be kind of down in the middle somewhere so front and center our audit opinion um we get we issued an unmodified or what we call a clean opinion on the city's financial statements um following that is kind of the city Management's responsibility in the audit process our responsibility and the audit process those types of things if you read through that report also we've completed the single audit testing this this time this we finished it this fall um we were busy with that as well we tested six major programs this year normally we test about two the reason for that is has a lot to do with the covid-19 funding some of the rotation of the programs that we have to test over time it just fell we ended up testing the Section 8 program this year because it was due up so that was one of the six programs we did not have any findings related to any internal controls over those programs or compliance issues with those programs the city spent about 97 million dollars in federal dollars last year and we ended up auditing about 89 percent of that just because of the way the dollars fell and you know some of the programs were pretty large that we had to test um we did have one internal control finding um related to um we had some audit adjustments through our audit procedures when we were reviewing audit schedules we did find a couple of errors that required audit adjustments um from the city side and we felt that it was there were enough of them it Rose to the level that we thought we should report them to you as governance we considered it a significant deficiency not a material weakness over your internal controls but again we felt it was important enough to bring to your attention um we still have a couple of reports to complete I don't think they're anything we need to bring to you guys we're we're working um the court has a triennial agreed upon procedures we're just about done with that we have a HUD filing that needs to be done and then the expenditure limitation report which all of which will be done here in the next probably month or so so with that I'd be happy to answer any questions thank you very much Sandy Council questions on this agenda item all right thank you Irma this one looks different I apologize oh there we go they look different on the computer I apologize [Laughter] okay okay I'll go quickly through the results of our our audit Sandy went through that as you mentioned we had unmodified report it was issued clean opinion we didn't have any material findings we followed generally accepted accounting principles and all the government accounting stands board statements which as Sandy mentioned Gatsby 87 which is a big one this year some financial highlights our revenues increase for the City Hunter 2 million dollars compared to the prior year the graph shows that the majority of the revenue increases in our governmental activities but you can see a steady increase over the last three years the detail of the revenues for the governmental activities is taxes that's sales tax and property taxes sales tax revenues continue to increase for the city and you see that in the First Column unrestricted and intergovernmental revenues who are pretty steady the transfers actually were pretty steady compared to Prior year and there was an increase in program Revenue most of our federal funds arpa and e-rep are all recorded as program Revenue so that's why you see that big increase total assets for the city increased a 5.2 billion dollars the largest portion of our assets are capital assets which are our buildings our infrastructure our water plans that kind of thing and then we have other assets and some cash and Investments cash advancements increased in comparison to Prior year as well this is a snapshot of what our investments were as of June 30th of 2022 we have cash with the bank with local government investment pool with the state and also some long-term Investments the city's tour liabilities were 4.2 billion dollars if you compare to the prior years it looks pretty steady comparison to the prior years our larger two liabilities are our bonds outstanding long-term obligations and our pension and other post-employment benefit liabilities that we also have this compares the long-term obligations current euro compared to the prior year by each of the types of obligations that the city has and then this is a comparison of our pension and open unfunded liability broken up by the type of the pension system asrs Public Safety and the city's opeb other post-employment benefit plan level results of our audit and mayor just I want to thank Sandy and her team for uh coming in and doing ought to do a great job every year and Irma and her staff who have to prepare for this literally year round as you prepare for the Auditors to come in and so we appreciate their work and making sure there's a very high standard of which how we account for the public funds and I also want to be make it very clear the city does not run a deficit that would be illegal for us to do that we can't do that everything that is planned in our budget whether it's governmental resources or transfers are planned and are calculated to meet the needs of the city so I just want to be clear that in no way does the city run a deficit budget thank you thank you Council are there questions or comments on this agenda councilmember I'd just like to make a couple of questions but a couple of comments overall in the taxes we had a significant increase in our tax revenue and I just wanted to state that is an increase in taxes that is a increase in sales activity for anybody interested so we haven't increased our our taxes in Mesa in fact if we've done anything we've reduced it especially on the PRI the secondary property tax um also um that we do have reserves that we'd like to keep at a certain percentage we did identify that our Reserve funds was higher than we wanted it to be and so we intentionally drew that down like especially in our utilities and some other funds using some of that reserves instead of taking increases to offset expenses so um those are a couple of comments I want to make and share the audit and finance committee thank you thank you in spilsbury yes thank you so much for all of this um Chris I just want to ask a question then what if you know normal citizens looking at this and they see these negative amounts or whatever and you're saying we don't have a deficit right so I know it's extremely complicated and very confusing but like how could we make that clear to just the normal person reading it and my way it's very simple and since there's an auditor in a room we can we can verify okay if you isolate some schedules you can come up with one conclusion if you take all of the resources of the city they're available and scheduled to be available for our expenditures and our operating activities we do not run at a deficit so you take all our resources and that's all the taxes coming in all the reserves that we have in balance and whether we in in the transfers that we schedule from the Utility Fund since the 1940s all of those are available to pay for the operations of the city and all the Capital Improvements and all the debt service whether it's in the general fund or whether it's the Utility Fund we take all that together we have enough available resources to meet the needs of our capital and Debt Service overall so that's the plan if you want to isolate specific descriptions of revenues and taxes and only these operations over here you can show that they don't match up but that's not how we do our budget we look at all the resources available to the city against all of the needs that we're going to have and we certainly don't run out of deficit because we can't go borrow that money if that when we hear deficit I would suggest you have to go find the money from somewhere else we don't it's all included all self-sustained we we cover all our expenses with all our resources and so it's just looking at the if you want to be very if you want to be isolate certain schedules you could come up with that but that's not how the city operates yeah we consider all the resources and we've always scheduled transfers to cover Public Safety expenses and some general fund expenses and we've been doing it for decades so it's it's not we don't run a deficit we've always that's always been part of the plan perfect thank you and I I mean I have access to a ton of people that I could ask these questions to and look into and research and stuff but I have heard this from other people out in the community and so what would be the best person to direct them to or if they had questions like who should I steer people to that could that you know people who want to dig into this that it looks like a deficit to them who who could I steer them to I think Mr Kennington and Irma would both be the right people and then you guys could could tell them who they like who they think what they're talking I think they've met with several uh individuals over the years okay because I mean again I I don't want people out in the community to think that we run our city at a deficit because I know that's not true but I have heard I've heard that from several people and it is just it's like you said isolating different parts of the budget and so I just wanted to make that um available to people to know that they could come and ask questions thank you thank you I'll just I think everything that needs to be said has been said I'll just reiterate that we are anxious we are very transparent or I appreciate uh Mr Davis I appreciate your passion and your interest in this and I know I had appreciate the opportunity we've had to chat a few times and for you to meet with City staff so thank you for for being you know good faith asking these these questions uh I don't not disappointed at all you're here right but we want folks to to ask these questions and to get these answers and and I'm very comfortable uh for the reasons that have already been expressed that the city's very financially sound are we don't haven't talked about our bond rating but they're you know AAA and double A Plus and uh we uh and have a good uh report from our auditor so I I feel like I'd be anxious to talk to anyone that has questions about our financial uh stability and and uh feel proud of the job that we're doing any additional discussion on this item is there a motion to approve this item it doesn't need to be approved oh oh okay so this is not on our agenda for Action State stature requires that the auditor present the results of the audit at a regular council meeting but the state sector doesn't require that Council had to approve it it also uses the word accepting so the motion won't hurt the statute's unclear and so I'd rather so I'd rather do the motion just for rules and suspenders right I understand I know it's a very oddly worded statute so I'd prefer to have the motion thank you electronic we have Miss Pillsbury making the motion and Ms Duff seconding it uh so please vote I think you're passage unanimously with Mr Freeman absent and excused next agenda item is items from citizens president Ms Mosley do you have any requests to speak we have no requests in here all right thank you that concludes our agenda for this meeting is there a motion to adjourn thank you Mr Summers and Mr Heredia all in favor please say aye aye thank you we are adjourned [Music] [Music] foreign