Thank you >> for all the work. >> Ready? >> Okay. Good morning. I'd like to call this meeting to order. Miss, would you please call the role? >> Mayor Plet Wardo, >> present. >> Council members Roland Beretta >> here. Okay. Can we see Mr. Betta too? >> Uh, there he is. All right. Okay. Sylvia Compos >> here. >> Eric Anthu is not here yet. Giller Nandez >> here. >> Kayn Paxton is not here. Ever Roy >> here. >> Mark Scott >> here. >> Carolyn Vaughn >> here. >> City manager Peter Zenon >> present. >> Deputy city attorney Buck Bryce >> present. >> Okay, we do have a quorum present to conduct the meeting. >> Great. Thank you, MissWa. So, this morning we have a presentation on the capital improvement program or the CIP and an overview of the city's debt profile and potential adjustments to the fiscal year 2026 proposed budget. >> Then, mayor also after that, we'll do a wrapup of potential amendments that we've been tracking over the past four weeks. So, we'll go over that with city council as well. It does reflect the community input sessions that we've had. Uh last night was the seventh. So, uh, we're making recommendations to amend the budget. Just minor based on, uh, consensus, uh, statements from the community over those seven meetings that we've had, plus, uh, uh, we have some, uh, recommendations based on council input over the past four work sessions where there seems to be consensus where we've placed things on a document, and we'll go over that as well after those two items. >> So, the capital budget, the debt plan, and then the wrap-up amendments process. >> Okay. Thank you. >> Morning, mayor, council members. Edmonds, director of engineering services, and I'm going to be uh presenting the recap of the proposed capital budget and also what we call our uh capital budget uh scorecard. This is something that uh we implemented last year uh where the budget office has developed a way to kind of track how we're doing on implementing the capital program. Uh so I'll be going over both of those. Um now part of this is review. When you were going through the the meetings, the workshops with the operating departments, they they also talked about uh their capital plan. Uh and I'd like to say that uh this is not really my work product. the the CIP is a mutual effort between the operating departments, the office of management, budget, uh, of course the executive leadership team and u and of course city council plays a role. Um uh once the CIP is approved, it becomes marching orders for my department for engineering services uh to manage the delivery of the CIP. And of course that's a team effort and involves every department in the organization uh as well as city council in delivery of those projects. So uh we facilitate that. Engineering services acts like a program management office for delivery of the CIP. So um okay I had a different slide starting here. Well uh two things I want to call out. Uh the first reading on the CIP is going to be next Tuesday September 2nd. Uh and the second reading is going to be September 9th. Uh also according to uh the city charter article 5 section 3 it also calls for adoption uh by the planning commission that was reviewed and approved by the planning commission on August 20th. Uh so what is the CIP? Uh the CIP I I think it's important to emphasize this is really a planning document. Uh and we update this once a year. uh and it's it doesn't change that dramatically from one year to the next. It's kind of a refresh uh and an update. Um so we consider it like a 10-year plan looking at capital projects over 10-year horizon uh that are are needed. Uh we reestablished a capital budget office uh in 2018. Um, prior to that, for several years prior to that, we had kind of a half of an FTE that was putting together a book that would be reviewed every year. Uh, they didn't even look at the long range projects back then and it really wasn't emphasized. There were a lot of departments that uh really didn't participate in in the process. So, uh, that budget office was reestablished in 2018. Uh, we have been improving year-over-year going through this process. Uh I think you'll see as I go through we're we're getting much better at this as an organization. Um you know the way the book is developed the the budget office works with the operating departments to uh create a list of their needs. Then they identify uh potential funding sources. uh and as I mentioned once you adopt it uh it kind of becomes marching orders for us to implement that. Okay, we have three baskets that we look at three categories. So when we talk about the capital budget, we're talking about the year one budget. Um so that's the the first year and that's the number that we throw out. the CIP is X number of dollars. Now for a project to move from long range which is 4 to 10 into short range funding has to be identified for the project. Um now sometimes uh the projects are are partially encumbered when construction spans multiple years. Uh, a typical project delivery can be from three to five years. I I have some construction contracts that are actually four-year contracts. Um, uh, but as you're going to see, we're getting a lot better at the the projects that are moving into short range are projects that have been identified previously in the long range. So that's something you want to see and we're getting better at at doing that. Okay, this is the way that the current CIP breaks down uh by uh department or category. Obviously, the largest one there is water. Uh now the table on the right, we've split that into the Inner Harbor project and all others. Um and that's close to half and half. uh the inner harbor was 210 uh and uh the remaining water uh was almost 180 million. And as you know the there's a special PMO that's established dedicated PMO for the Inner Harbor project. So, we're managing the CIP minus Inner Harbor and we basically do the same type of activities that that PMO does, but for the remainder of the CIP. Of course, water, waste, water, streets are are the big three in there. Okay, these are the funding sources. So revenue bonds is the largest uh source of funds and then the second is the swift funding and third is uh is geo bonds. Now go bonds is is a category that uh we uh consider a very special uh even though it was the third highest source of funding. Um, as you know, GEO bonds have to go to referendum. You have to go to the voters. And so, um, we take that very seriously. And that covenant that we have with the voters, uh, we want them to have the confidence that, uh, we're going to deliver the projects that they approve with their votes. So, this is a graphic that we put out in our quarterly uh budget performance report. And uh I think we're doing pretty good on this. Uh now uh on 22 and 24, we're getting close to halfway expense and encumbered on 22 and close to a third on 24. I expect both those to be uh actually going up a good bit uh before end of the calendar year. Uh we've got a number of projects uh advertising or getting ready to advertise for bid. So there should be several uh bond 22 and bond 24 projects coming to council for award before the year end. So I think we'll finish out uh the calendar year around 80% on bond 22 and uh 50% on bond 24. So this slide shows what we're calling the FY25 CIP scorecard and we look at uh how we're doing based on number of projects that are on schedule versus delayed and uh also with the dollars and that comes out about the same either way. So uh there were 272 projects uh in last year's CIP of that 229 are on schedule and by that we mean the planned encumbrances were made during the fiscal year. Uh if we were not able to make the planned encumbrance uh we call it delayed. So there were 43 projects uh that didn't meet the encumbrance schedule and are delayed. So, of the um 1 billion in planned encumbrances, we were able to award uh uh encumber 861 million of that. Um so, for my department, that was uh another record. We've awarded $624 million of contracts, which was 100 million more than we did last fiscal year. Now 147 million uh is just shifted from last fiscal year to this year year one uh because we didn't get the incumbrance made. So you might wonder what are the factors what caused the project to be delayed? So, excuse me, I'm finding an upper respiratory thing here. Um, so I would say the most common factor is that uh our understanding is incomplete when we put a project into the CIP and there are things that uh complications that we become aware of as you move along execution. There are constraints and interactions that we weren't aware of when we programmed the project. So that can be due to external dependencies that are beyond our control such as permitting, external funding, uh outside stakeholders, land acquisition, not getting the number of biders, uh bids coming in over budget, things like that. So um and sometimes we have to delay things intentionally because project comes in over budget. We might delay other less urgent projects to create funding. Okay. And I would say overall uh we're doing way better than uh we did when I first started here and um doing better than we did last year. So last year we had um 75% showing on schedule and city manager stated they uh wanted to get to 80% which I thought was kind of a stretch goal at the time and it appears that we've actually exceeded that and reached 85%. So I'd say as an entire organization we're getting better at doing this. Thank you. Okay, this is a summary of the current CIP. So there's uh 243 projects in the CIP. So 33 of those are coming from uh long range to short range. There's 18 new projects. uh 158 ongoing projects and um 34 projects that were in the delayed category. So total is $765 million. And so the next slides I'm going to go through these fairly quickly. Um they cover the same information by category. We'll be switching back and forth between the uh report card for the FY25 and what's included in the FY26 CIP. So each of the next uh slides are going to go by category in this order. So airport, there were seven projects uh adopted last year in the CIP. Six of those are on schedule, one is delayed. Uh so if you go by number of projects it's 86% on schedule. If you go by budget it's 96 because the delayed project was a very small project. So for FY26 there's 10 projects total of 10 uh $8 million. So economic development and this kind of crosscuts various areas. The um these are TUR's projects. These are sales tax projects. Um so they had 36 projects. Uh six are showing as delayed. Uh so that's 83% or 74% uh on schedule. And uh one of the projects is showing as delayed I want to call attention to. So that's the White Cap and Gypsy project which was a TUR 2 funed project. Uh and pulling the financial reports they show that is delayed because we haven't touched that money but we actually uh decided to do that project with ARPA funds. So uh that project's actually about substantially complete at this point and uh those turf funds are not going to be encumbered. We're actually going to release those so that can be used for for another use. So for FY26, we've got 23 projects in the economic development category for a total of $23 million. Uh parks and marina. Uh we had 45 projects uh 38 on schedule. So we're about 84 or 74% on schedule depending on how you slice it. So, three projects that it's really going to be one contract, one project is a Greenwood Sports Complex is listed as three separate projects in the CIP that's getting ready to bid. Um, so we'll be bringing uh contract award before the end of the year on that one. So for FY26, we have uh 36 projects for a total of almost $38 million. Public facilities. Uh there's uh they had 19 projects last year. Two were delayed. Um so their performance is 90% almost or better for FY26 uh 15 projects for a total of $12 million. So, public health and safety um 18 projects. The the four projects that were delayed are um solid waste projects and that was uh intentional. Those were postponed um at the request of the department. So for FY26, there's 19 projects for a total just under $34 million. Um some of the projects that have been delayed are facilities projects. We've been going back and re-evaluating uh the need on those. And um uh some others, they've been self-performing some work that they thought they might uh contract out, streets projects, 44 projects. Um total last year 38 36 are on schedule, eight projects are delayed. Um those are mostly bond projects. Uh, one of those needs to be cancelled uh due to uh text dot opposition. Uh, uh, two have had some regulatory interference. Uh, but those hurdles have been cleared and those should be uh, uh, awarded before the end of the year. So for FY26, there's 46 projects, total of just over $76 million. Uh gas had eight projects last year. Uh two of those are are delayed mostly due to real estate issues. So for FY20, a total of eight projects for just under $40 million. storm water. Uh they had 13 projects. We're reporting all of those on schedule. So, they get the prize. Now, most of their projects were uh kind of Idiq contracts. So, those were fairly easy. They weren't specific projects. Uh but uh they still get an A+. So, still showing 11 projects for FY26 at $31 million. Wastewater uh 29 projects um 23 on schedule, six delayed. So, that gives you almost 80% on schedule. Um some of those it's been uh intentional uh due to budget uh because some projects have uh come in uh the bids have come in over budget and we've had to postpone some projects. Um for FY26 we have uh 24 projects with a total of just under $110 million. water. Um 53 projects. Um there's seven in the delayed category. So we're around 90% on schedule. Um some of the ones that are delayed are due to real estate issues and there's been some intentional postponement to create budget capacity. And one project was a boat ramp at uh Lake Corpus Christi which there's some obvious reasons why we're holding off on that one. Um so for FY26, 46 projects listed, uh total of just under $390 million. Okay, I've made it to the end barely. I apologize for my voice failure. So, I'll take any questions at this point. >> Thank you, Jeff. And we'll do question and answer here and then go to the next um presentation and do the same the overview of the city's debt profile. Does anybody have any questions, concerns? Okay, let's move on to You do have one, Councilman Hernandez. You know, obviously we have uh concerns with our debt and I know you're about to talk to it. Is there any projects in here that we may look at possibly, you know, prioritizing? I know in the past I've asked for prioritizing of projects, but I don't really see a prioritization list here on these projects on a on a department level. Was that ever part of the discussions when developing the CIP? >> What was the second statement? Councilman Eric, you >> okay? >> I heard the first part, but the second part. >> All right. So, I'll I'll restate the whole thing. In many times, we brought this to council over the years. We talked about prioritizing the >> the projects so you know which ones to do first versus, you know, kind of debating. There's some obvious things there as well where some are more easy to do than others. uh but in terms of selecting projects so maybe we have to whittle down the CIP uh so we don't overextend ourselves in debt there's not a prioritization of these projects >> um I think there is per you know per area and so the departments have looked at uh capacity especially in water and wastewater and have literally moved some back into future years and they're not recommending them this there. Um, and some of the other areas projects uh are there's very few brand new projects and other areas projects have been moved into the 26 plan that had been in the 10-year plan uh or in the second year of the 10-year plan. So, there's prioritization based on plans that the prior councils have seen in terms of implementing certain projects. And I don't know if Camille has you have anything else, Camille? uh you actually Camille terrace CCW um you actually got everything but each of those project pages has a designation of priority level one two three so for example for CCW level one means that we committed to this project it's either under completely under design or um completely funded the contract has been executed there are level two projects which are necessary and uh have to be done level three are um long longer range short long range so in the years three and then anything that we didn't prioritize as a necessity project it's in the long range. So we made the effort to make sure that what we're presenting in the short range are projects that are essential to the operations of uh of the util of the water utility system. uh similar was done like streets, right? All of them are going to be priority one because they're uh approved by the voters, right? There's that's wanted. They're going to be priority one projects uh there's uh no moving them anywhere. And similarly on other departments that was done the whole effort behind this is to show in the three the first three years projects that are necessary for the operations of individual programs. So for airport or for solid waste or for CCW. So that's that's the thing. Anything that does not need to be that can be moved to long range like the city manager said, those efforts were done to move those into the long range to make sure we're not just putting projects in the short range that potentially are not essentially needed right now. >> Okay. I I've seen what I've seen the priority levels, right? Yeah. But the majority of them here are priority level one. >> I mean you go through a whole section and I think I mo all of them are priority level one and then two of them are priority level two like for in the streets program. >> Well the street >> or no waste water >> for wastewater. Yeah again consent degree all of those. >> That's not exactly what I meant. I mean an order of priority. Right. So you might have you the majority of them say priority level one but what you know do you put them in order? uh do you have like some ones that you absolutely have to do and others that you are can be pushed on if you had to which one would you do first? >> So that's where the breakdown of the years. So certain projects are in years two and three that's where we're saying these have to be >> we're talking two different things, right? So like when Jeff presented that they got to 85% of the projects and 15% of the projects didn't get done. Okay. So was were those the priority projects that we needed to do versus ones that could have been pushed off or were they the projects that that had to be done but got pushed off for another reason? >> So speaking for CCW, the projects that were delayed are projects that are needed and have to be done but there were either like he said um we had to do real estate deals which delayed the project. It's a necessary project. It's for the newest river pump station, the line that's coming to ONS. It's a it's a mandatory project, but because of the real estate uh contracts that delayed us, but it's being executed at the beginning of next fiscal year. There's uh the um uh coal um no the flower bluff line that's a necessary project. It was delayed because of Sue uh work. So the the testing of the ground to make sure thing. So that's a delay for it. All of the projects that are delayed there um are necessary project. Another delay which happens very often is if we're getting grant funding. So two of the projects that were delayed on the wastewater side are CDBG MIT funded the mitigation grant. We got it. We came to council few weeks back. So that's but because we're hoping that money is going to come earlier in the year, it got delayed because the delay in how the money was delivered, but it's a necessary project. It's a project that we've been working for for four years to get the funding. >> Councilman, just one final note on your question is that we don't have the projects ranked, but if you'd like us to try to do that, we can do that for you. These are all these are all assumed to be high priority. they're in the CIP because of that and they were all approved by council last year. However, if you want us to rank them from one to whatever, uh, we can do that. >> Okay. I mean, I just I want to make sure we understand this correctly because you have like improvements to Labot Day Park as a priority level one um project. Uh, and that's equivalent to a bond project on the street. >> That's right. That's a bond project. So, but I mean is that I mean are are we going to have detrimental aspects if that gets pushed off a year? >> That's that's voter approved bond program project. >> Well, I get it. I understand. But I'm talking about, you know, realistic aspects of it, not >> I mean the the the idea behind why we put all bomb projects as prior number one is because they're driven by the voter approval, right? the council one, as Jeff was saying, we're trying to deliver these bomb projects as quickly as possible. So, we prioritize them as number one, you know, to try to get those projects done. Uh or as quickly as we can. Obviously, there's a timeline. Uh but if the council wants us to to delay bomb projects, we could. It was just that wasn't when we're putting this together. We >> You're missing my point here, right? Jeff has limited, you know, he has a certain amount of staff that has to prioritize the work that's being done. And so I want to make sure that it's clear to him what the priorities are, right? And so if everything is priority level one or the majority of it is, >> yeah, >> how does that really >> Yeah. So Jeff has a team of uh you know of of teams made up of various uh disciplines and the goal is to advance all the projects almost simultaneously. Obviously, bigger, more expensive, more complicated projects take longer. But if you recall, uh because uh one reason we're getting all of our barn programs done now within four years rather than 12 is that all projects at least in streets go under design 6 months after the vote. The city council through a mass selection process awards design contracts not to the same design firms but a dozen at least. So, uh, private sector partners are designing projects simultaneously while we're bringing construction projects to council. So, it's a complex process, but um, obviously we can't work on them all, Councilman. So, there is there is planning where certain projects and Jeff's work plan and Rottner's work plan have priority and Jeff should speak to that. I don't know if you can speak to that Jeff but >> well there there is constant interaction with the operating departments on on priorities and and urgency of projects and uh of course whenever we have a project uh for example come in over budget. The typical thing that we have to do is look at is there a way are there projects that have encountered uh challenges that can't get executed in this fiscal year and we can shift funding from those projects. So there is kind of an ongoing conversation about this um pretty much continuously. >> Okay. Uh, I've brought this up on multiple occasions and it's not, you know, we talk in circles, so I I don't know if it's ever going to get really identified as what's priority and what's not, but Okay. Thank you, >> Councilwoman Compos. >> Thank you, Mayor. Okay. So, um, back to page six, Jeff. on um the 2018 bond we have you know similar to what I mean what what are the projects that are still waiting for a 2018 bond in 2020 that's you know do you know what those specific projects are >> uh the 2018 bond um we had some projects uh that were put on on North Beach >> uh that uh we couldn't really move forward because we had this question, are we going to put a navigation canal down the middle of North Beach or not? And and these projects were crossing uh the alignment for that potential canal. So, uh there was a lot of time that we had to answer that question before we could really even get out of the starting blocks on those projects. >> Yeah, that plus the bridge, Jeff, we weren't because it was uh because of the design build nature of it. it wasn't for certain where certain aspects of the bridge would terminate and ramp off and so we didn't want to build the street only to have to tear it up because that's where the exit would be. >> So the 2018 bond is is for North Beach. Is that what >> those were the main main projects on that and I think this is uh they're going off of what's in the financial system. I think there have been some incumbrances that may not be reflected in that. In other words, it might not be totally up to date because we used some of that funding I think on the North Beach project that may >> Okay. So, so now the bridge has been built. Now we have it looks like we've mostly complete. I mean, there's still I see still some uh working on the street. So, when do we anticipate that these the remaining last bonds will be executed? >> I think Jeff said it. They're already being executed. Just this bar doesn't show complete dollars spent, but the money's have been encumbered. >> Okay. >> Uh we brought to council contracts to do uh the the roads including uh Beach Avenue uh Berles and the drainage canal work as well. So, >> okay. >> There was one other project on there that uh was at the JFK Causeway and uh we were >> tied up with a regulatory uh interference. Um, and we just recently cleared that uh where we got the uh wet area under the bridge uh out there where not Snoopies and Docks is uh we got that uh declared non-jurisdictional so we can move forward with some improvements. >> That was the Army Corps we were waiting on. >> It was we we got that just recently, >> but it was the Army Corps, right? Army. Yeah. The US Army Corps of Engineers was It takes time to get permits. So that was a delay. That's why that delay occurred. >> Wow. But the project's moving forward and uh there's been a lot of community engagement >> on the devel on the design of it, what it what it would actually be. >> Yeah. Well, I you know, I can understand why North Beach has been, you know, uh harboring on on that. You know, that they want uh results from their bond. So, >> there Councilwoman, they were in agreement with this with the schedule and they know that it was out of the city's hands. >> Okay. >> Yeah. We couldn't do we we couldn't reconstruct beach because we weren't sure of the of the terminus of where the bridge the new bridge would ramp off. >> Mhm. >> Um but now it's all under it's all under Yeah. design and construction. >> Okay. >> Yes, ma'am. >> Well, and I also noticed that uh 2014 it was actually on this. So we actually had bonds from 2014 that we just completed. Is that what I'm saying? Is that >> we had bond 2014 100%. >> Yeah. Yes. So now it's 100%. So that's the remaining funds which was like 1% of that bond was for the harbor bridge mitigation. So the park projects that just came to council very recently were funded partially by the bond for 2014. So now because that was and it's encumbered that's now at 100%. But that was the outstanding little bit. Wow. In that bond. >> Wow. Okay. All right. Um, the other question that I just had, it's just why did y'all group P public health and safety on this one? >> Can can you elaborate, please? >> Well, you have it on your uh I guess page 17 on the projects. I don't know why y'all group public health and safety budget 18 projects, you know, you just grouped them all together. Why was that? >> So, public health and safety, it's a program, right? Is there if you look at the actual solid >> public health, safety and solid waste. >> Yes. So there's so public health and safety consists of fire, police, and solid waste projects and if you look at the summary page from the public health and safety section in the book, right? They're individually uh separated so you know how much is saying that's a grouping that has been done since I took over the the program. Um >> why is that? that doesn't seem to jive. >> Um, >> it's well >> I I I think uh in part those those tend to be grouped together under a bond category. Uh and you'll see this across multiple cities. There's uh you can separate it. This is just historically this is how they have grouped uh those categories in the CIP. H. Wow. All right. Those are the only questions I had. Thank you, >> Councilwoman Vaughn. >> How many How many grant writers do we have? One. >> We have u uh one. We have two. We have two. And then in this budget, in the proposed budget, we added $100,000 for grant writing contractual services. >> Yeah. >> Excuse me. So, we have two that are in finance that can service the entire city. And then each of our departments, some of our departments have dedicated grant writerfish school people. So like in the police department, fire department, health district, um they have dedicated staff members that write grants often. Animal care, similar, >> but we added two in recent years to kind of overarch the organization where some departments that might not have dedicated people to write grants, that's what those two positions do. And then we added $100,000 in the 26 proposed budget for >> Well, that's good because they can certainly pay for their salary. >> Absolutely. >> And it's only 6.3% of the funding. Have we set a goal? Say this is how much of this we want you to do because if you don't give them a standard, they're not going to reach it. >> Yeah. >> And and I know at the county, and I know I'm not at the county, but that we almost lived off of grants because they don't have any money. >> And so to me, we ought to set a goal, Mr. Cone, and say, "We want you to reach this." >> Yeah. >> So we can get more funding. And I would be curious because I think police do it well. I don't know about the fire, but what what are they in each department? What are they reaching? How much of that percentage is theirs? >> Yeah. So there's the you'll see a greater percentage in the operating budget. >> So in the capital budget, maybe Heather who oversees it can speak, but the the amount of grant opportunities for construction >> Yeah. >> is less than operating. So a lot of the grants that we bring to council weekly deal with operating >> Yeah. uh with staff, with uh programming, that type of thing. Now, we do have one grant that uh we applied for for the um for the uh Flower Bluff Trail to Trestle. Uh that was like a $13 million grant. >> Very unique. And so that'll help rebuild that trestle uh from Flower Bluff to the OSO preserve. That's a good example of a grant >> that was good. Yeah. >> A lot of these grants that are shown here are uh airport grants, FAA grants. >> Okay. >> Yeah. Yep. >> Yeah. Yeah, and I'll add to that on the on the capital side, those grant opportunities kind of eb and flow. Um, like Peter said, the a lot of times we get more consistent grant funding within our operational budget. The um capital projects really do eb and flow depending on what grants are available and what projects we have that match up with those because we don't want to apply just for grants just to be applying for them. We want to make sure that there's a need. And um you we do do a good job of trying to go through and say, "Okay, we have these projects." And that's what's been great with the long-term planning is we work very closely, our grant writers work very closely with the utilities especially to say, "Okay, what do y'all have coming up? Here are some granting opportunities. How does that fit in with our planned CIP >> and I understand that." So, but I just hope we get the percentage goes up that we >> we we try we try. So, >> no, you do. You'll have more help. Thank you, >> Heather. Sure. The other thing I was going to ask and I may have overlooked it is, you know, I think we talked about in water that in order for Mary Roads to get more water, we had to have another pump. >> So, is this in the plan and and I could have overlooked it because I was looking at this at midnight last night, so my eyes could have got tired. >> But is it? >> Sure. Uh Nick Winkkelman, director of water systems. So, there is a spare pump for Bloomington and Woodsboro pump stations that have been ordered under the existing capital project. Mhm. >> They will arrive next month, but keep in mind to fully install those and make them operational, we'll have to shut down the Mary Roads pipeline. So, the functionality, we've got to work on that and figure out the timing. Additionally, LNR is working on spare pumping equipment. >> So, is this normal? Every time you put a pump in, you have to shut down the whole pipeline to put one pump in. >> So, >> it just doesn't make sense to me. I get it, but it just doesn't make sense because they're in different areas. >> Well, and and let me back up. So, if you when you shut down the Woodsboro pump station, >> you you're limited to pumping schedule three. >> Okay. >> So, when I say a shutdown, it's also a limitation. >> Still going. Okay. So the the original design of the pump stations included a space for spare pumping equipment, but it did not include uh what we call the header piping to connect it to all the piping to actually pump the water into the pipeline. So to do that, we've got to shut down the pump stations now to do those improvements at um Bloomington. So Bloomington's needed to pump schedule three. So, if you shut Bloomington down, the pipelines's got to go back to schedule two or 2B, okay? >> Is what we call it, right? >> I just want to make sure we've got the funds to have the pump and to be able to do that in the future, >> right? We're fortunate for uh uh council support of those capital projects and and one of them was a change order um request that council approved this fiscal year. >> Just making sure that >> you can just add to that though. So the recent discussion that we've had and Nick if you can just stay there for a second just um we the Mary Rose pipeline putting 100 million gallons into the pipe none of that project is in the CIP today. Uh that conversation has come up because of the water potential water source excuse me at Evangeline Evangelene. Uh so right now we're carrying all the water rights that we have through the pipeline whether it's the lower Colorado or the um or Lake Texana. So the pipe is carrying all bought water from the from the east. When Mary Ro, excuse me, when Evangeline comes online, we're looking at now the potential of putting more than just the 12 million gallons in. But to have 100 million gallons or plus, there has to be, as Nick has said before, complete redesign of the pumping. So you'd have to we have to figure out the cost for the engineering, the the construction, that's not we don't have any figures on that yet. So that's not in the in the budget today. But as we move forward with a with Evangeline, we'll have that simultaneous conversation with the council on the capital cost. >> Okay. I just think it's so important for the future that we have to make sure we have the money for that. Thank you, Mr. Simone. >> Okay. >> I only have one more and it's just because I'm nosy on on that council text that that you had to cancel. What was that project? >> Uh that was improvements at the Encantada Park Road 22 uh intersection. >> Okay. And uh we had some ideas of changing that intersection and uh text wouldn't approve. >> They didn't like it. Okay. >> We wanted to do. >> Okay. Thank you. >> Thank you, Councilwoman. Um on grants, Peter, just a couple of things. I think we Well, it may have been brought up before, but we've had um we have two two right. Uh >> we have two one uh one is filled, one is vacant today. >> Okay. So, we don't have two filled. >> No, we have two positions. Um, and let me just see. Is they both filled? Okay. Well, I guess in the last two weeks we filled the second one. So, they're both filled. >> Are they contracted or are they >> No, the city staff, the city employees. >> So, what I'd like to see is um how do we prioritize what they work on? We have 29 departments. Pat does an excellent job of I mean, I know you'd like a grant writer, Pat, but you do such a good job. Um, you've got you you've got it down. I know Laura is here. here. I saw her walk in. Libraries, libraries, there you are. They they do their own grants also, but I know that's that's a big struggle over there. Animal care services, nobody does anything there. And and I I know I know a lot of people up here know there are a lot of grants. Um probably for all departments across, you know, this organization, but especially animals. So, my point is is how do they prioritize what they work on? who says, "Okay, work on this grant or this department for a grant." You know, how does that happen? And I'd like I'd like to see a a list the whole council of what grants have been attained since we've had a grant writer or I think we've only had one, right, in the past. This is the first time we have two. >> And the 20 in the current year budget is when we added the second position, right? And it's been vacant filled, but it's it's filled again. It's filled again now. And I think we've had one kind of on and off, >> right? Yeah. For we added the one I think three years ago, right? >> And then we added the second one last in the current year budget and now we're adding 100,000. But we did Sergio in finance did present a report. >> Exactly. >> And Heather may want to speak just a little bit to it, mayor, on what the prioritization and what grants we've. Yeah. So the grant writers work directly with the departments and so they go through on a regular basis talk to the departments about what needs they have, what opportunities there are. Then they go through and they do the research and they look, you know, grants go through funding cycles and so not all grants are available all the time. And so there are multiple areas that you go to go do that research. So looking on there are um posting boards, there's the different organizations or um that offer a lot of grants and so they are constantly monitoring what those opportunities are. They share those opportunities with the departments and say okay um animal shelter you've got there's an opportunity for a grant for $50,000 for this. Read through it and tell us do you think that you would you know do you have an opportunity for this? Is there a need for this? um do you meet the criteria? Then that comes back to the grant writers and they say yes we do, no we don't. And then we move forward from there. So it's very much a collaboration between the grant writers and the departments based off of the department's needs, department's priorities, and what's available during the current funding cycles. >> Okay. So that said, I doubt I'm sure it is very difficult for one person to go through 29 departments. So, I would imagine that right off the bat they take 20 and I don't know, but I'm assuming they're going to say, "Well, let's mark this police." They're not necessarily going to go do grants for CCPD. So, that gets kind of taken off, right? >> Not necessarily. I mean, they're looking across all the, like I said, I mean, they they look at they look at this on a daily basis, basically. What's out there to be able to be applied for? What are the needs that have been identified? And so, um, you know, they're they're working with the departments constantly. >> Okay. Well, but but it's one person. So, I guess what I'm saying is there are departments that are in great great need. And so, I'd like to prioritize those where they're not right now. You're saying they're kind of all over going, "Well, let me look at this. Let me look at that. Let me see if this one's good." And I'm not saying that's a maybe the process works. But if we prioritize out of 29 departments, which five are in are in the greatest need and then they go look for maybe that to see what's available there that could help us. >> So, mayor, um to add to Heather's uh to what Heather's provided, so the way our grant uh writers work is we subscribe to a software that provides our grant writers with the opportunities. we're able to subscribe to specific programs. Um we're on the process of onboarding departments so they can get notifications of which programs are out there. So it's it's pretty much uh we are working with all programs and uh as Heather mentioned depending on the availability of of funding out there um we'll go after those grants but some departments aren't um you know match has been an issue u or the program doesn't line up with what we're trying to do the funds that are available at the time. There has been a large cut of federal funding recently and so even though we're adding more folks there are some programs that are no longer available. Uh what I do want to share is we've applied for 38 about 38.9 million. This year we've been awarded 35 million. We have 8.2 million of applications under review and we have 30 million in process right now. >> I would love for us to be able to see that information if you can send it to us. That is great. We'll bring it back. >> Where is that going? >> We that was from your report that you gave to we presented to council a few months ago. >> Uh yes sir. And this one's updated up through July these speakers. >> Okay. We'll bring it forward again. >> Why don't we do this regularly? we can >> use these reports regularly so we can see this is great this department got it and I don't mean to cut anyone out but animal care services >> I know there's so many grants out there and and I don't know you know maybe it's not it's not my world so I'm just trying to say let's prioritize in some of the the the most needed departments we appreciate that >> yes ma'am and so we do subscribe and animal services is one that we are pushing to the department and they're jumping on as quickly as possible >> okay great thank you and and lastly because we're on grants you know uh right now we have the GLO commissioner Don Buckingham. She's in in town and she um actually there's a little check presentation I think she's giving to Newasis County. The city is receiving well over I want to say it's 140 million and it's flood mitigation is what they're doing and and across not only county but it was very um very impressive and so we're very grateful to the GLO to Commissioner Don Buckingham. kind of want to throw that out there. But I'm also curious to know because theund I want to say 40 million is going towards our wastewater treatment plant. So I'd like to know how does that fit in and what what is it we're we're using those those monies for? >> Yeah, Nick, it's probably the CWBG MET monies where we're putting in backup uh generators and >> is that what it is? >> Yes. >> Yeah, it's backup generators for our wastewater plant and it's specifically Greenwood. It's focused on Greenwood. >> Greenwood, >> right? We applied for that through competition and that that gives us redundancy at Greenwood which if there was a power outage the plant would shut down. >> Yes. >> So this uh it's a pretty extensive project right? >> It it is and Camille reminded me that this also includes OSO. So it depends on how far we can stretch the dollar, but it's the it's the two plants. So with with any generators, there's a lot of engineering to to design how to integrate that electrical backup, too. But yeah. >> Great. Great. Thank you for those details. Okay. Uh, Councilman Scott. >> Oh, geez. Thanks. First of all, I'm starting I'm starting to notice a lot of Kleenexes in the room and at some point I'm leaving. Mayor, if there's uh cuz I mean I know I thought Jeff's just making it up, so we'll feel sorry for him. And I'm totally cool with that. But then I started looking around and like and then there's there's snipples around me, man. What is going on? And here's the answer, by the way. It's because the weather's changing that our allergies are acting up, which means rain is on its way. So, that's my positive thought for the day. I had two things. >> Oh, and I Yeah, mayor. I don't want to I don't want I just want to point out it did rain during my It rained during my mayoral reign on Tuesday. So, I just want to It's kind of leader. Two things. One, um you probably provided this before and I might may have been on the council. I'd like to see kind of the the grand plan uh on North Beach as you come off that ramp and then turn around and come back to, you know, to the Texas State Aquarium. Is there a map or is there >> I'm just curious what that experience is going to be. It's weird because you got to you're >> you're going farther down uh North Beach, but on the other hand, if it's a pleasant, you know, kind of a cool transition back to the Texas State Aquarium, that could be a benefit. I just hadn't seen it. >> I We can get you that. Yeah, we do have that Councilman. >> Okay. >> I'm kind of hoping you'll be able to actually do it here in the next few weeks. >> All right, that's cool. Any number one, number two, >> if there if there is I've been on councils that were criticized for uh not getting u bond approved projects done on time. So, I just I want to be a voice that says don't slow any of that down. I I don't I don't necessarily care whether you prioritize some one and some two and some three, but I I think I want to be a voice that says we made a commitment to the the taxpayers to get bond voter approved bonds done and I I want I want those all to be prioritized and get done. Any just want to be that voice. Thank you, mayor. >> Yes, Councilwoman Compos. >> Uh thank you. I I back to the grant. Thank you for mayor uh for mentioning about the grants and you know uh wanting to have more information but like one of the things that since it's going to be a new position again uh the homeless uh and also you know again sidewalks um I think I brought this up before that somebody pointed out that there was grants for sidewalks but if there's no one advocating that you know to apply for homeless grants or to apply for sidewalk grants or so that's why you know it would be nice for us to be able to prioritize and say could you be looking out but then I don't know who would be the one to follow through on that right >> right >> that would be the issue because there's no one to oversee sidewalks or who where would it >> where is yeah so Ernie's in charge of the entire rightway public works so Ernie would be the the first point of contact >> and then the grant writers and Sergio who just spoke uh would be second point of contact but um >> with the homeless, where would that fall under? >> That would that's going to fall under planning and community development. Okay. Planning community economic development. So um that one that new position that we have in the proposed budget would that person would be the first point of contact. >> Okay. >> And then um you know the the uh finance department and grant writers would be the second points. >> Okay. So like for example the trestle you know that was a huge uh grant and >> but that where did that come from? like how did >> that came from us being aware of the uh of the issue on flower bluff and it actually started though from the a grassroots effort >> right that's what I thought >> leaders right so community leaders in flower bluff and the city partnered with each other >> and understood their desires with the trestle uh we were aware of the grant we actually Dan Mcan actually applied for the grant >> okay >> uh the island the flower bluff group the community group uh actually applied for some pregrants that helped us do some pre-esign work and then Dan uh discovered this grant that was out there through the park through the park system and we applied. >> Uh one thing we had to do though is is budget about a million dollars for engineering for the design work. The grant covered all the construction. >> Okay. >> But we did finally it took a little bit of time because we identified money for the design. So, >> so kudos to the community for, you know, initiating this. And >> we tell them that every time we go down there because that's a wellorganized >> uh group of individuals that advocate for that community. >> Okay. >> It makes a big difference. >> Thank you, Peter. >> Yes, ma'am. >> Councilwoman uh Paxton. >> Thank you, Mayor. Um I have like just a quick comment I think on the grants. I know that we are not necessarily that unique. I mean, municipalities all over the state face very similar issues and that's why there's resources that can notify us as certain grant opportunities come up and we can check for our um you know if we qualify for those or not and then of course going through the department priorities. But I think two things that in my experience are very important elements to steering our grant initiatives are certain city initiatives like that we're doing you know citywide whether that's bike trails or trees things like that but I think another big part of that kind of going into like the efforts with the flower bluff citizens council is you know each I think each council member with their district has priorities and working with the grant department helps push those through in addition addition to what they're sorting in each department. So unless things have changed, I think that's a that's a pretty fair description of those efforts. But my questions on page 308 and 309 in the um CIP book, I know um they're both referencing the Noasis County Groundwater uh system program. I was curious. Um, page 308 does designate funding this goround. Page 309 does not. And that's more specifically re relating to the pump station. Um, and all of our discussions and planning for that um resource. My understanding is we've already begun test wells. And so with the test wells in place on and and and correct me if I'm wrong, the way I read this is this is helpful for that 250 acres that we bought. Um, so if this is relating to that project and we're not securing funding in this fiscal year for that pump station and sort of things, is long story short, is that going to delay our efforts where we're already um getting into the ground with some test wells and things like that. >> Page 309, there's nothing in this budget. Page 308 for some initial stuff. There is. >> Sure. So, so real quick, u on page 309, what's called the Noasis River Wallwater Pump Station piping and system upgrades, that project is associated with the pumping station at along the Noasis River pumping water from there to Owen Stevens. So, that's a project that's independent of any groundwater well project. the the project on page 308. Yes, that's our Noasis groundwater program. The funding and expenditures there and you can see it includes the grant from the state that is for the the construction of uh primarily the western wellfield. So the property that we purchased earlier this year. So that would be the buildout of that wellfield along with conveyance uh to the river provided we we obtain that second bed and banks permit. Now recently we started talking about opportunities for a brackish groundwater facility that is not identified in this project page. >> Okay. >> Right. Because it's been recently. >> But this at least continues this project and this prevents delays from accessing that. >> Right. That's correct. Yeah. We'll continue that project. The delay, the gap on that page 309, the 26, that's because we we're redesigning the project. So, the 16 million that's in the in the prior years, that's active money being spent right now. Uh we came to city council recently to acquire some property to be able to kind of redirect the pipe that way instead of >> boring underground. >> Okay. >> And there was some challenges with one of the one of the properties where was undermining dirt around our important pipeline delivery system. So, is that correct, Nick? So that gap is just to get caught up and continue to execute the 16 million and by the time all the redesign work is done the uh the properties are acquired then you'll do the installation work in those next two years. >> Yeah that's that's correct. So the project it it uh be because of adjacent properties and the complexity of that pipeline corridor uh it was the most prudent decision to purchase additional properties which we did with council approval this year. The design contract was has also been awarded. So, we need some time for further design to complete it. Then construction. >> Okay. >> And it it goes back to to more detail and foresight. We're looking into properly budgeting per year. We're taking a real close look on that. >> Yeah. I Okay. I appreciate those efforts. Certainly. Thank you for that clarification. My next question. On page 311 of the CIP book, I see um funding listed as uh in the prior year category. And I presume some of that has to do with um those initial study contracts that we entered. But what I didn't see was funding this year, next year. Um should they bring that because I would anticipate they're going to bring some findings to us in the near future. Um, and so I was curious if we correlated with them on any kind of estimates or >> Right. So that that was a uh professional services contract uh that was awarded to Garver Engineering. They are evaluating uh our reclaimed water and the best use for that water and they they're currently doing that work. Uh we met with them recently. It also includes basically it's got a couple of priorities. First one is the quickest. Uh is there a good way to get water uh to the river to help supplement our flow or to other users? Uh the other one is uh to further investigate aquafer storage and recovery. And then the third tactic they're looking at is direct portable reuse. Now all of those will have different construction costs, different design fees. So, this is a pre-engineering project so that uh all of us can make the right decision on how to proceed. >> Was there um do we have a timeline on when they'd present back to us? I'm just >> what I don't want to do is get us in a position where we have a result and then there's >> Right. Um the uh Nick will answer that question. I want to add that we have another we have a proposal uh that we're bringing to council on the 9th. Um >> is that accounted in here anyway? That's not in here either. Uh but that's a project where a local firm partnering with a a state enabled authority in the Houston area, G Coast Authority, >> um has a a proposal for us on reusing all of the water from OSO and Greenwood um and and uh putting it into production. So, >> do we have any type of a financial parameter at all from either? >> No, we're meeting with them. We're meeting with them again today to to review the final presentation. So, we'll have to see. They didn't we didn't have it as of Do we have it unless Yeah, we don't have it as of yet, but we'll see today if we can have them give us some type of range of uh what that would be. >> Yeah, that way we have um some kind of room to take some action because I think that could be a fairly quick turnaround for some >> we agree. Right. >> So, if we could add Right. And one of the one of the uh pluses for this council on that project is that they would issue the debt so it wouldn't appear in our capital budget. It would be uh they have the they have ability to issue government rated debt >> on this new project, not the the other. Okay. >> Yeah. So, it wouldn't show up in the CIP anyway. It would be an operating expense. >> Okay. Perfect. Thank you for that clarification. And then my last question, um Jeff mentioned a boat ramp at Lake Corpus Christie, but I saw um a little article that there was this week placed a a temporary boat ramp specifically for shallow >> I saw that too. that was in the state park system. I don't know did you guys track that? I I saw it myself and like sometimes I'll learn things out in the media for the first time which is not good but that's fun. >> That was actually a state park system. >> Uh so the state put that in. It's a sh it's a a ramp to recognize the water's too low. You may have seen to the right was the act was the other boat ramp that normally was used. >> So that is um I don't know if anybody here can speak to it. My curiosity is from what I can tell is it's um it's movable so it can adjust to influxes and reductions in that in that water system. So my curiosity is if that if that potentially could translate into some savings in our forecasting here. >> Yeah. >> Well, as you can see, we we push that back right to the the current conditions. And then as as part of your um budget packet is an increase in some of the fees at Sunrise Beach to that would eventually fund that project. And if those that that doesn't happen, then we would we would essentially continue to move that project out or or >> are those fee increases? >> Yes. >> Supposed to start now or >> for uh >> they're up for consider consideration and then they would project it start January. >> Can we >> Oh, October 1st. October 1st. >> Well, if we is can we evaluate that um technology that was just installed this week and see if we can delta there? >> We can. Yeah. >> Okay. Perfect. >> Yeah. >> Thank you so much. Councilman Roy. >> Okay. Um couple things, Peter. I was trying to remember years ago, right? And because this kind of goes handinhand with the grant writers. Um, were we set up from a staffing hierarchy or whatever as far as like all the accountants were linked together? Because right now it's departmentalized, right? But wasn't there a time when all the accountants had like a main accountant and then um there if all the IT was even though different departments had it, there was a main IT person. >> Right. >> So it's right that that's we refer to it as a shared services concept. Yeah. So that does exist in IT especially uh where Peter Collins has brought all the IT people either in his department or he has some oversight if they're in another department. Um, and where I'm heading with this is that when you think about the grant writers, because um, what I'm curious about in terms of talking about a a report card is that um, number one, if in the hierarchy, I'd like to see who does the who do the grant writers report to right now? >> They report to Sergio and the finance director. >> Okay. >> Yeah. Um but I think what's important especially with grants uh is that not only tracking the ones that we have been successful in but also kind of understanding the ones that we weren't successful in and just in terms of looking at an overall ratio. So, for example, if we apply for 150 grants and we get 30 grants, kind of seeing if there's a uh significant reason, you know, and I know sometimes with grants, we turn grants down because of the obligation that grant might put us under. We learned this with public health. And so just being able to understand that as a council to to say, okay, yes, we had 130 grants, for example, we got 30, we had 20 that we turned down because they it wouldn't have been advantageous for the city if we had to adopt a certain method or something >> so that we can just get a better understanding on that. I think it's and then also making sure that even though all the grant writers may one for police, one for fire that they are communicating with each other and just um from in terms of best practices. Um you know I think that would be good. Uh the other thing I wanted to talk about was the impact that the bridge has on coming down the the current the old bridge, the harbor bridge when it starts that demolition period. And I know that that's been the challenge on North Beach and just other areas around, you know, uh, in the sea district and that trying to understand what the landscape's going to look like and how it's going to impact the infrastructure in those areas once that bridge does come down. Um because I know that early on at the beginning of the year we had I think North Beach had seven different requests and we met with that community and said okay these are the priorities that they wanted and so as I look as we get further on in the year where we're at some of those things were pretty easy but I think they were also tied into grants like the signage at the historical near Pier 99 was that a grant that >> so no that was going to be tur spending and we're moving Yeah. Exactly. So, the the historical plaza um we do have a project um that we'll be bringing forward for the tours board to consider. Um parks and wreck is working on that and we worked with the department with the neighborhood association to identify those aspects they wanted. Um I think we're breaking it into a couple of phases and so yeah, we're working on that. >> And as far as the benches go, were we looking at grants for to try to I know that we've had several community groups talk about adding benches and certain things to our parks. again. So, uh, specifically on North Beach, we were we're working again with the community association to identify those aspects of things that they're looking for along the the the beachwalk. Um, that would be using either parks or recog funding or tourists funding. Um, as far as across the park systems, we continue to look for opportunities within either our current budget, the park development budget, or for granting opportunities. >> I know nourishment nourishment's also an important thing that I know that there's grant monies out there for that. >> Yeah. So just just thinking about that, I mean it's pretty robust. I think we can save the city quite a bit of money if if we put our efforts together and and approach those things um strategically. >> And to point out exactly and u and parks and wreck actually just recently um made an offer to a person for a grant writing position within embedded within parks and recck. So we are continuing to find identify those opportunities to have someone dedicated to that. >> Okay. Um that's all I had. Thank you. >> Sure. >> Okay. Uh, Councilman Hernandez, and then we're going to move on to the second uh, presentation. >> Uh, yes. Thank you, Mayor. One thing I had forgot to ask about uh, under the water uh, raw water supply projects, I noticed that Angeline wasn't in there. Could you provide us the information so we can make an amendment to the CIP to add it? >> Um, we can, although the council where the the um, next step on that would be in October to bring the contract to city council. >> Okay. It's just a plan, right? This is a plan. >> Um, all these projects are funded that are in here. >> Yeah. What I would go ahead. Yeah, >> I'm sorry. What I would propose um um just to mention um to Councilwoman Paxton's um the groundwater project has a long range um aspect of it as well, years 4 to 10. Those don't have identified funding, but it's a recognized project. We could add the evangelene uh to that long range as a separate line and once we get to um once we get to the point that we want to commit we'll then amend the budget to shift it from the long range to the short range and then assign a a funding source to it. So that that would be a solution. So it's in the plan. It's not in the short range just like the city manager said because of uh we don't know the full cost and then the funding but it's in recognizing the plan and it can be quickly shifted from just one action from the city council from >> it's not in the long range plan. No, no. I I'm proposing we could add it uh which doesn't require an amendment. Uh then we can add it bringing as an amendment u for the second read because the first one was posted. We can add it that we're going to add this project uh to the long range. >> Um >> yeah, >> you know, I'm I'm I'm hesitant to go with that recommendation because I think this is more of a shorter term issue than a long-term issue because long-term issue is beyond three years. This is what you know what Camille's saying councilman is it's not a council approved project yet >> and once it becomes one in October then we would amend it but he we would put it we would it would be recognized in the CIP that the uh the example that we can use is bond programs uh when we put a bond program out uh until the voters approve it we keep it in the long range plan and then once it's approved we move it into the into the first year plan >> so we could >> what I'm saying it's not even in the long range plan >> I know that's But that's what we're saying. We'll put it in whether we decide to put in the short range or long range. We need information to put it in there. So could you could create a page or some information so we can include it >> and and the council will decide whether it's in the short or long range plan. >> Sure. >> Okay. >> We can that would be for the second reading because the first reading was uh already posted. So we can't amend that unless you want to do it on the floor. >> Well, I need the information. We'll make the recommendation for next week, but we would recommend the long range because it's not a it's uh not approved yet. That contract, we just worked on it yesterday. Yesterday, in fact, and the plan is to bring the evangeline contract for the water right purchase and land e land access uh at first week in October. In part because the appraisal that we asked for uh will be done. Then it's a 45day delivery on the appraisal. >> Okay. Again, this is just a plan, right? No, the first year is a budget and then every other year is a plan. >> Okay. So, even if you put this in year two, you could still have a page for it. >> Okay. >> Something along those lines. >> The year two and year three are not part of the budget. >> You're right. You're right. We just don't want to we don't the >> we don't want to um deviate from the the strategy of the first year is a budget. Those are council approved or voter approved projects. >> Understand? >> But we can put it in the second year and then you'll have a page for it. Peter, I understand. Yeah, you know, we you know, we do, you know, we did make a a council motion to give you the authorization to go do the contract. So, I think we did make an action for it. >> So, I I just want to have that information out there for public consumption. >> No problem. We can do that. >> All right. Thank you. >> Okay. Yeah. >> Thank you. So, we're going to move on to the overview of city debt profile. >> Okay. Okay, I'm Victor. Victor, Victor Kyogre, our financial adviser, is going to present on this. Uh, Victor helps us with our our debt plan and and our bond programs and other financial matters of the city. So, honorable mayor, members of council, Mr. Zenoni, thank you for having me here this morning. Uh, for the record, my name is Victor Koga with Specialized Public Finance, and we have the honor of representing the city as your financial adviserss. Thank you. And I appreciate your patience with me here today. I have a big setup here, pretty intricate. Um, one of my biggest fears, I've been doing this now 25 years. One of my biggest fears is uh maybe missing a highlight of a presentation or a big point that we wanted to address. The other sphere is to put people to sleep because bonds aren't the most exciting things to talk about. Um the first two or three years of my marriage u my family and my in-laws thought I was in the jail bond business and not in the municipal bond business. So um but the sad thing is over 25 years I still haven't found a way how to make this funny humorous presentation. So uh with that I I hear my job is to give you u your information and where you stand with the city what the future might look like. And so um here today I want to thank you for letting me present this information to you. The um purpose of the presentation is to give you a clear picture of the city's debt obligations. Uh we'll talk about the recent financings we conducted the ratings of the city. Uh and also talk about the planning framework because here we're in a CIP budget. We're looking at this upcoming year and even future years. And so we'll talk about how all that fits into how much debt we could afford and how we uh fund these important projects for your community. And so the slides ahead uh we'll talk about and review the um how the city continues to benefit from a strong bond market reception, meaning there's willing buyers out there. Uh we do have a very strong rating both on your general obligation or property tax side and also your utility system revenue bond side. Uh we'll talk about um the federal interest rates we got on that and also how this all ties into um not only issuing debt but also refinancing debt the savings to your taxpayers and utility system uh rateayers based on how we've structured the debt and the opportunities you've taken. Um equally important as we were talking about the future, we're looking at how do we fit all these um project needs and funding needs into our overall debt plan uh in order to stabilize the tax rate which is the number one goal whenever we're getting ready to issue debt for the city. Additionally, with respect to the utility system revenue bond side, what we're trying to do there is preserve the utility system debt coverage ratios that we have to abide to based off of our current bond covenants. And how do we not overextend ourselves now to the position where we can't afford future needs that will uh come up? And more importantly, uh, anytime we conduct these financings, we want to always respect the economic life of the bond project that we're funding uh, through debt. And then finally, we'll talk about at the very end the uh, fiscal year 2026 uh, funding needs that the admin the staff had provided us, how that fits in um, into the long-term capacity and the protections in place you have currently for the city's taxpayers. Great. Uh, so I don't want to belabor this here, but uh, when we were, uh, had the honor of h being hired by the city as your financial advisors, I was really excited, not only number one to be associated with the city and be able to assist you with your financing needs, but, uh, the big reason was when we walked in, uh, it was very unique. The city has a 10-year CIP plan that it maintains and updates every year. Uh that is very unique unfortunately for many uh Texas municipalities. Uh uh even a five-year plan is very difficult. Uh so this is not only viewed fairly by me because there's a plan in place that we're looking to fund and we have to monitor that in order to see how are we going to afford it, but it's also viewed fairly by bond investors and bond rating agencies. the rating agencies um view this as a credit positive, meaning that the city is on top of its capital improvement needs. It's looking not only for the next year, what you're going to have to fund or looking to fund, but also 5 years, 10 years down the line. They also recognize that 10 years is a long way out and so, you know, things change every year. So that's why you have these budget workshops each year to determine based on the updated facts, you know, are these still priority projects? Uh do they still cost the same? Do we need to adjust the cost and rep prioritize other projects so that we could uh uh fit this in? So um the the on the other side there's uh some municipalities uh I won't name names but uh you know they don't have a capital improvement plan not even for the next 5 years which is um unfortunate because a lot of times when you're like that you are more in a reactive position meaning that oh an emergency comes up now we have to find money that we don't have right now to fund it and issue debt for it. So that's a credit credit negative rating agencies don't like to see that. So, all to say that I think it's very commendable that the city has and maintains a 10-year CIP budget. Uh, you know, whether it's all funded or not, or whether it's funded with debt, cash, or grants, you know, that's a determination that's made every year. So, um, here a lot of times because you do have this capital improvement budget, uh, in place that's very long. Um, the unlike the other cities that don't have one and a big needs comes up and then they have to be reactive and issue debt and call us and, uh, those aren't the best calls, even though we're able to help them, it's not the best position we want to be in because it forces you to rush. It forces you to maybe accept terms that we could have gotten a little bit better from the bond investors. But um many times because you're dealing with the long-term capital improvement plan that you're maintaining each year and going out the next 10 years um a lot of times those projects as you know have been approved by the council to allow the city staff to start moving forward with procurement with planning design uh etc. And even though you're starting the project, what's been wise practice of the city that's been commended by the rating agencies here in the last 3 to four years is that um you're not actually uh issuing debt as soon as you're starting that project or you're authorizing the city staff to start that project. That's wise because um you don't want to issue debt and start paying interest on monies that are just sitting there you're not using. uh you want to make sure you're being wise with that. So, a lot of times the city uh is funding projects whenever we come up to you and to issue debt uh and get your approval to move forward with the financing. Uh sometimes those projects were maybe from last year or two years ago or even three years ago where we're just funding it uh to complete it. Uh so again, just wanted to commend the city on that. So here uh in total it could take anywhere from 12 to 18 months by the time you initiate a project to the time you fund it and sometimes even longer in some cases that we've um uh experienced here. So this is a a a chart that I've presented to the council before. These are the four primary or most common debt financing tools allowed by the state of Texas. Uh a city council and uh can only do whatever the state of Texas allows us to do. Uh and so these are the allowable financing tools that the state has. Uh I know some are more popular than others and maybe not popular at all in general. So we have the general obligation bonds or what we call general improvement bonds here at the city of Corpus Christi. This is where we first have to request taxpayer approval through a bond referendum to uh ask them to uh let us issue an amount of debt to cover a certain amount of projects. Uh this one is going to be your most flexible tool. We use the interest and syncing fund tax rate to repay that debt. This type of financing tool will typically get the best interest rates and the bet best credit ratings uh from rating agencies. Uh these are supported primarily or the security mechanism that the bond investors have are going to be the city's authority and ability to uh collect property taxes from uh folks that are or entities that are within the city limits. The other c the other one is certificates obligation and uh don't run me out yet just because I say that word. Okay, but uh um this one is very similar to general obligation bonds and that they get the same very favorable low interest rate. Uh uh these have the same protections for the bond investor in that if uh you don't make payments, they could compel you to set an INS tax rate sufficient to uh repay that debt. uh those interest rates are the same for general obligation bonds. Certificates obligation, it depends on the city. Some people only issue certificates obligation and some um maybe never issue certification. It's just a city by city decision as to how you want to deploy these tools that you have in your toolbox to fund your projects and take care of these needs. I know here more recently the theme has been to try to limit the issuance of certificates obligation because although you still have to give notice to your taxpayers that you're going to issue that type of financing tool under current state law we don't have to have to hold a bond election to do that but it does allow your citizens to develop a petition to stop that certificate obligation financing. Uh in the past few years, the state legislature has been putting some limits with a certification before we could iss uh issue certification to uh fund an arena or to do a animal shelter, you know, things like that. Pretty much anything that the city uh functions and provides those services, you could use certificial obligation to fund those. Here they've been restricting the use of certification. Uh they really want you to if you do have to use certification, which is still legal right now. Um you could they want you to focus on public safety or public works type projects and they're not going to let you go build a new city hall. Uh they'll let you renovate your existing city hall, but they're not going to let you go do an animal shelter certification or or or fund the arena or anything like that. So um again there's limitations already in place by state and also these decisions are made by the council. The other tool are tax notes. Here the limitation is that if you issue a tax note you can't um u stretch your debt repayment past a seven-year term. And so there's uh state restrictions there that you have to pay that in a relatively short period of time. Because it's a relatively short repayment term. A lot of times when cities use this, it's going to be for smaller projects, maybe projects that have a shorter economic life like vehicles and uh things like that. And also because if it's a seven-year term, those payments are going to be high. So you can't issue too much or else, you know, you'll be experiencing increased debt payments uh automatically. The fourth one is revenue bonds, and these are for typically where we issue them here is for your utility system to fund uh your capital improvement needs uh for uh your utility system. But you so you could also do sales tax revenue bonds. These are these are going to get the higher interest rates uh because that bond investor doesn't have the more secure protection of property taxes to uh repay that debt. Uh so let's talk about the city's bond ratings. Uh here this is a chart that we uh put together and provide to you and other clients to let you know where your current ratings are by the rating agencies that are reviewing the city. um and based off of the general obligation debt that you have outstanding and also your utility system debt. U here what this chart is showing is that you see that red dash line on the on the chart to the right. Um we never want to go below that red dash line. That's if you watch movies or or you know read something and you hear the term junk bonds, that's what they're talking about. If you're below that, you're considered a junk bond. meaning that it's very risky for the investor to lend you that money and if they do it's going to be very high interest rates. Uh fortunately the city is very very far away from that uh position and if you see the blue if you go with me to the top these are the three major rating agencies that currently review uh our bonds that are outstanding. If you see on uh we have standard and poor rating agency, Moody's and Fitch ratings. These are all major credit rating agencies that municipalities use. The blue one there, that is the rating category that each rating agency places on us for that particular debt. So the blue one is for your general obligation debt or debt that is secured by property taxes. I told you earlier that those get a better interest rate and they're viewed favorably by rating agencies. And the reason why is because there's nothing more secure for a bond investor than having that collateral or security mechanism of property taxes uh that the city has uh ability to collect on the maroon color there. Right underneath there is your utility system bond rating. And the thing about here is that all three rating agencies view each of that debt category in the same. So standards, Moody's and Fitch are all in the same level. in that they view the city's uh credit rating for your general obligation debt of double A or what Moody's calls double A2 and Fitch calls double A. So, as you could see there, the top that you could get is a AAA rating. That's the safest, highest uh best rating that a municipality can get. And just like when we're borrowing money to buy a car or or or or get a mortgage, the bank is going to look at our own credit rating. And on a personal credit rating, it's it's they use numbers. Same thing with bond rating agencies. Uh, however, they use letters. And so, the higher the credit rating that you have, the better for your taxpayers and rateayers because the lower interest rate that you're going to get whenever you need to borrow that money. The maroon side there, that's for utility system revenue bonds. Uh, that's one notch lower. That's at a double A minus. And that's uh for all three major rating agencies. So um the this is all to say that the rating agencies look very favorably on the city currently for your geo bonds and utility system bonds and this is an independent third party. This isn't Victor your financial adviser uh saying that um this is these are all independent rating agencies and these rating agencies are important because rating bond investors are looking to them to give them an independent view of the credit profile of the city based on the type of bonds that you're issuing. So again, the city's doing a very good job with its uh credit rating. Uh they look at really four categories when they're looking at you. They're looking at your the economy of the area, financial performance, management, and debt position. And basically, I try to summarize this by saying that the rating agencies base you and judge you on on really two factors. Factors that you can't control. Uh you can't control who's moving in, what industries are coming in. Um you can't control people leaving or coming in. uh residential uh developments, you can't you really don't have too much control on that if at all. So, they're going to rate you on that. You you can't uh you know control the wealth uh uh ratios of the community here within the city of Corpus Christi. Uh but then they also uh judge you on things that you can control and that is are you being conservative in budgeting each year? are you uh do you have a a sufficient expenditure controls compare compared to other cities that are like you not only here in the state of Texas but you're judge and based off of other municipalities that are similar to you uh throughout this uh the country and so everything that the city's been able to control the rating agencies have uh continue to highlight that and commend that to the city saying that um you have very strong management the decisions that the city is doing are very prudent And um because of that, you've been rewarded by having a higher interest rate, higher credit rating that'll give you a lower interest rate for your taxpayers. But uh overall, things that you can control, the city has been doing a a great job uh managing that and um uh being very prudent with taxpayers money. So this is reflected here off the rating agency profile. Uh so just a quick summary regarding the recent financings that you allowed us to pursue and conduct on your behalf uh during the current fiscal year 2025. We first went into the bond market June 26, 2025 for utility system revenue bonds. And that financing we did two things with one financing. We borrowed $181 million in what we call new money or these are new funds that you're going to utilize to um address your uh improvement needs there for the utility system. We also took this opportunity uh to refinance $128.1 million of outstanding higher interest rate bond that you had out there. And that generated your rateayers uh net interest cost savings of $8.2 million that you were able to deliver to your rateayers that are going to be achieved over the next few years uh through the reduced interest uh cost payments. One thing that's unique um and I'll get too much in the weeds here uh but we there's a mechanism I told you that we were at the double A minus category. So what we investigated we did a cost bed and defendant an analysis for the city because that's what we do as your financial advisor. We're trying to get you the best rate for your rateayers and your taxpayers. So what we did is we applied for what we call bond insurance. Basically, this is where um if I were going to go and borrow money, I was young and I want to borrow a car, but if I bring my parents with me to co-sign that, they're going to give me a better interest rate, right? And so, similar thing here, but this is what we call this bond insurance or credit enhancement. So, we were able to do that. And that actually let us issue your debt for your utility system, not with the double A minus that were naturally rated on by the by the rating agencies, but that the double A. And again, the higher the credit rating, the lower the interest rate. So, because of that mechanism that we're able to deploy and utilize here, we were able to save your rate payers about $1.2 million and really foregone interest costs that you don't have to do because we got a better rate on that. Um, I told you earlier that the rating agencies view city corpus Christi favorably, but this is also reflected by the uh bond investors. We were selling about close to $300 million in bonds. That was a new money project and also the refinancing opportunity. Uh when we went out to the bond market, 53 institutional investors wanted to purchase the city of Corpus Christiey's utility system revenue bonds. And uh we actually had um fewer bonds than what we were able to get orders for through the underwriters. We got orders for $1.3 billion from investors for the $300 million that you were trying to sell. We view this, and that doesn't happen all the time to every city. We view this as a positive because there's bond investors out there that are wanting to um make a bet for a lack of better term on the city of Corpus Christi because they see that they're going to get repaid their debt and the decisions that the city has been making have been good and they feel comfortable with lending you that that money. Um that transaction closed July 17th. Uh we also on August 18th we issued general obligation bonds. Uh these were um uh in total a little over $84 million in bonds. And we sold general obligation bonds. These are the voter approved bonds that you have authorization to issue. Certificates obligation. We sold some taxable certificates obligation and also some tax notes. All of them came in under budget. We're budgeting about 5%. They came in about 4.39 4.4%. So again overall good news for the city. This one was also overs subscribed and this was about 1.4 four times over subscribed. There are more orders in the bonds that we have available to offer the market and this one is going to close on September 16th. Uh no action is uh required by the city for that closing. So let's talk about how much debt we have and and a lot of times even me I've been doing this 25 years and you see oh god we're going to borrow a million dollars or hund00 million and we we've been fortunate we've seen low and and and and and large amounts but it's all a matter of perspective. We've been, like I said, I've been doing this 25 years and we've been helping many cities throughout the state of Texas and some have issued, you know, half a billion dollars at once and some have issued half a million dollars all at once. And to me, it's all the same because it's all um uh uh relative. You know, a small city is only able to afford half a million dollars, but a large city may afford half a million dollars. But at the end of the day, it's all the same. It's all relative. So we always u uh respect that and make sure that you're feeling comfortable and you're in a good position to uh continue funding your bond programs and your capital improvement needs. So the debt that's secured by your property taxes currently the outstanding balance as of the end of this fiscal year and it includes the recently sold bonds that we conducted for you earlier this month. We have an outstanding principal balance of $578,590,000 currently at the end of the fiscal year is what that's how much we owe bond investors on a per capita basis. That's about $1,221 uh uh per citizen that's paying property taxes and that that's a or per population that you have here within the city. Regarding the utility system, these numbers are higher because the utility system is going to be more capital sensitive, meaning you need to invest this costly infrastructure to provide the services that you're continue to provide to your rateayers. Here, these bonds, we have a total principal amount at the end of this uh fiscal year of $1.45 billion. If you look at it on a per capita basis, that's $4,575 thou uh dollars. uh on a per capita basis, but I put two asterisks there because um as you know, you're a regional provider of water and so your services and revenues that you bring in for that service extend beyond the city limits of the city of Corpus Christie. So, I just want to put that asterk. Um the rating agencies, they're not really looking at that 4,75 $100 per capita debt. They're looking at the your overall scope and the overall services and the number of uh rateayers that you have out there in the multi-county service area that you have which is about half a million people uh more than the 317 here in the state. So uh what does this does not include are the voter authorized bonds that the voters gave us authority to issue on their behalf from 2022 and 2024. So those are not included yet there yet because we've not issued that debt yet. So, a little bit more detail here for your property tax or geo supported debt. We have 37 bond issues outstanding. Uh, the principal amount, as I indicated earlier, was a little over $578 million. The final repayment term uh or payment date is 2045 for the property tax debt. The city has been very prudent. You've limited your uh repayment term on any property tax supported debt to no more than 20 years. And so this gives you puts you in a good position in that you're putting future councils and future staff folks in a good position to be able to afford bonds because you're paying these bonds off earlier than what is typical. Many cities, municipalities will go up to 25 even 30 years uh and extending them because they want to reduce maybe the tax rate or they want to reduce the payment but you're not letting you know future uh councils be able to um conduct the needs and finance the needs that they have. So here the blue in each bar that's your principal payment that's structured. The yellow is the interest rate or interest costs that's scheduled based off of the debt that you have outstanding. All the debt that we've issued in the past here at the city have been uh fixed interest rates. And so these aren't variable interest rates. It's not going to change. The only time the payment structure changes or that rate changes is if you decide as a city to maybe utilize extra cash to pay off bonds early or if you conduct a refinancing like we've done in the past uh for the city. This is just a um a look here at your annual debt service payments. Uh this is your principal and interest payments per year on a on a fiscal year basis. So for this upcoming year, fiscal year 2026, the uh payment that we have um uh due is a little over $65.2 million. So that amount where that revenue is going to come from to make that payment to those bond investors is going to be your interest in seeking fund tax rate or your debt service tax rate. But you could see there it rolls off every year as you move on. you're going to be paying off debt and you're going to allow yourself and other councils the opportunity to fill those gaps in with future needs if you need to address those through a bond issuance. On the utility system revenue side, uh here we have 21 debt obligations outstanding. We have a principal balance of $1.45 billion here with the utility system because the needs have been great greater than the go side. Uh here the strategy has been to amvertise or set up repayment schedules for your utility system revenue bonds over a 30-year basis. And the reason why is because we're trying to still make the rates affordable. We're trying to meet the covenants that we have with the bond investors out there um and the and the limits that we have uh for us to be able to issue additional debt. So here the debt repayment final payment is going to be 255. Uh this is a little smaller here. So I'm glad you have it in front of you too, but this is over the 30 years uh what the average annual or the annual debt service will be. This is your principal and interest for this upcoming year. We have principal and interest payment due for the utility system revenue bonds of $103 million. Uh and it's going to be a little stable there for a little while and then it starts dropping off again as you're paying off outstanding debt as well. These are also fixed interest rates. So, uh, let's talk about, uh, the property tax if you're still with me. Nobody's I don't see anybody asleep yet, so that's good. Yeah, I'm feeling good now. But, um, here, um, whenever we're planning, and again, we're looking at a 10-year CIP. We're looking at asking voters for general obligation debt to fund streets or whatever projects they allow you to do. Um, it's not something that's just presented to the voters based off of, you know, this is what these, uh, projects are, these are what we think we need, this is how much we think they're going to cost. This is all part of this overall long-term comprehensive debt planning that we assist the city with. And so one of the things that we look at particularly for bonds that are going to be paid by the property taxpayers um through either go or cos or tax notes is um that payment is going to be based off of what the property values that you have within the city to repay that debt or what we call taxable property values. Um as you can see there, I'm glad I have it here because it's a little small. Um, this is going back to fiscal year 2017 and each year has been different just based off of what the appraisal district has set those values. Of course, the city council has no control on say on those property values or what you have here. And so you can see there we had some pretty healthy growth and in 2022 to 2024 here at the city of Corpus Christie and also many municipalities throughout the state. Um, uh, appraisal values uh, jump because of the economy. people are wanting to move to Texas and made real estate very valuable. Unfortunately, this current year that we're in, fiscal year 2025, we actually u uh realized an actual reduction in the amount of property value that you have to work with here as a city. Uh and so that went down slightly. Some of it was because of maybe the appraisals, you know, didn't go up as high as they normally do, but a lot of it here, to be honest, is to is because of um additional reductions that you gave uh property taxpayers within the city. You increase the homestead exemptions and everything, which is um uh good for the taxpayer, but then when you're working on a budget, that just means you have limited resources and revenues to work with. So then you have to make these tough decisions. What are we going to cut in the budget? And uh are we still able to afford our debt? Uh right now based off of these projections here and the re reduction in values that you achieved this year, we're still in a good position. We're still able to afford your property tax supported debt. Um but we're very conservative when we're planning this and developing a plan for you in the long term in that although on the last 10 years, you could see here on the average annual basis we grew about 5.2% per year on your property values. uh last um five years is 6.29%. So a little bit higher growth even though we did have that reduction last year. This year good news is that you all didn't go down. You actually went up by about 2%. So we always like to see that uh increase because that impacts what rate we have to set to be able to pay the bond investors their principal and interest payment back. Uh but you can see there in the blue that is the projections that we're using in our current bond affordability or bond capacity models to be able to afford these voter approved bonds. Uh you can see there that we're we're we're purposely uh using a lower estimate and we do that on purpose because we want to be conservative. The last thing we want our clients to do is to overpromise and underdel uh on their bond projects. And so one of the main factors is can we afford those bonds and when and when are we going to have those um funds available to continue these projects. So you can see there moving forward our models for the next three years is showing a 2% uh property value increase. Uh after that it's 1% and after 2035 it's going to be 0%. We do that on purpose again because we want to be conservative in us telling you how much you could afford and when. Uh so this leads into the property tax rate. Uh the area that I'm uh delv into more is going to be the interest and syncing fund tax rate. That those taxes within that bucket can only be used for the repayment of outstanding debt uh that you have and the maintenance operation there is just to run your um operations of the city. So here the total tax rate that's being proposed as you know is going to be the same as the current year and the same as the previous year at 59.98 cents per $100 valuation. the 22 cents that's identified there under the interest and syncing fund tax rate or debt service tax rate. That's the uh rate that has been stable and on purpose the city has are wanting to keep that civil not been wanting to increase it to afford these new debt issuances to pay for your capital improvement needs. So the bond elections whenever the city has gone for bond programs it's indicated that it's a no tax rate increase. This is what you're talking about there. the the goal is to keep the INS tax rate at 22 cents and be able to afford your existing debt and new debt. Um, of course, you like I said earlier, you have no control as to what the property value is going to be set at by the appraisal district. And so, that component could change. Uh, the bottom graph is just a a look at your last five years of tax rate. You've been able to reduce the tax rate uh for the community by about 5 cents to cover your operations and also your debt. And so um overall, you know, the rating agencies look very favorable, very very favorable on this. I think I've been talking too much. I'm already stuttering. But um here just to give you a glimpse into a onepage information regarding the uh additional uh savings that you provided your uh taxpayers, particularly your homeowners, is that uh for this current year, what you were working with and why the property value decreased from the previous year by about 5%. is that you increased your homestead exemption from 10% uh to up to 20%. So you doubled that. So that was really the largest factor why those values went down that you're working with. You increase the over 65 homestead exemption from 50,000 to $62,500. Uh then you also made a change to the disabled person exemption from 50,62,500. All the other uh areas were not changed and uh those are still uh in effect currently. So, um, regarding the bond programs, we, uh, we're still working on the November 2022 and 2024 bond programs in with respect to the financing. A lot of these projects may have already been started, but I said earlier, we don't want to issue debt and pay on interest on money that we're not using and deploying. So, this has been another strategy that the city has been working with. Uh currently um for the 2022 bond program that the voters allowed you to move forward with, they let you borrow on their behalf $125 million to cover the projects within the four propositions that you offered there that's listed there. Uh currently we've accessed to date $80 million of that $125,000 authorization and what remains is $45 million that is what we call authorized but unissued. We haven't tapped that money uh just yet to to um pay for the projects. In 2024, the city again based off of its two-year cycle address the voters and asked for $175 million to address projects, park, recreation, public safety, and library. Um and one thing I want to commend is it really stands out to me uh in representing other municipalities is that the approval rate was really high there. Whenever you're going above 60% that means that the uh obviously the taxpayers are okay with you issuing debt for these projects. They're popular projects and that the city can deliver of this bond authorization that we received recently of $175 million. We have not accessed any of that funding yet. But that's not to say as was described to you earlier in the previous presentation that those projects have not started just yet. We're just trying to be strategic and not issue debt and uh pay interest on money that we're not using. And so going towards next year and the information provided to us by city staff is that they believe uh based off of their uh project estimates that the uh general obligation bonds, these are the voter approved bonds that they will likely need about $75 million uh in the authorization that we're we have outstanding and also certificates obligation. But uh these are likely going to be for uh two reasons. Um number one from my understanding is is going to be for some cost overruns on some street projects. And then the other purpose primary purpose is going to be for uh for the solid waste area because we're funding that through debt is for their infrastructure. The other component is going to be tax notes potentially of $2.7 million and my understanding that's for developer uh repayments or reimbursements uh that you've committed to. Uh and also currently the approximate amount that the city is looking to borrow for the utility system is about $230 million. Uh again, you know, these aren't set in stone yet. going to depend on um the projects where they are in terms of the timeline when I come back to you next fiscal year to see if we do we really need this much we need more and so that determination will be made by you uh in the next few months. So just some of the overall uh fundamental components in our debt planning that we work handinhand with city staff and they're always uh great to work with and very responsive is that we never want to issue debt and have that debt longer life out longer than what we're actually funding. We don't want to issue a 30-year bond for a vehicle that's going to last us 5 years. So, we always keep that in mind whenever we're structuring this for you. As your financial advisors, as indicated earlier, we're using conservative attacks and revenue projections. We're not going to say that, oh, you could afford this because you're going to grow 10% per year on your property values, which that's not the case. Um, we review the capacity and sensitivity analysis. We have to be very mindful of that because in order to issue additional debt, we have to um confirm with the existing bond holders that we could afford this debt and we're not going to put their repayment at risk. Uh again, these uh uh the goal of the city has been to keep the INS tax rate stable at 22 cents per 100 valuation to be able to afford your voter approved projects. Uh the utility system, we look at debt service coverage ratios and reserves. We make sure that before you issue that debt uh that you're able to afford it for the long term. And of of course what we've done here recently is that we've been able to pursue refunding opportunities whenever the market allows uh in order to reduce those interest costs for your taxpayers and your rateayers. This one I'm not a big fan of because uh you know all this is saying is that these are the top eight cities and this is your your population and and and really it it's very hard from a rating agency perspective or from a bond investor perspective to be able to uh judge different cities and it's never an applesto apples comparison. All cities are different. you know, um, some cities maybe have a lot of deferred maintenance that, you know, wasn't addressed previously and now they have to fund it or the current council has to fund it through debt issuances and so it might skew the numbers a little bit. Maybe other cities that have been issuing debt early on and addressing those capital infrastructure needs so that they're not issuing as much debt and they've already addressed it. But here, this is a look at the top 10 cities based off of the uh population of those cities. And also, we're showing here the property valuation that's in the middle of the uh the top chart there. You could see the uh valuation for the city of Houston. It's a larger city, a little larger area. There's they're working with property valuation for the M and INS tax rate of about 325 billion. Uh we're working with 31 uh billion or 30 billion u with property values. So again, it's all relative and it's just we have to work with what we have to we have. Uh the next column is the debt outstanding that we shared with you earlier and then the right side is the ratings that each city has. Again, no city is uh exactly alike. And so these are going to vary as well, but on a debt per capita basis, if you wanted to compare yourself against the other uh seven larger cities, we're about the middle. It's still pretty manageable. It's, as I indicated earlier $1,821. So, this is again just to show that, you know, overall the city's doing a good job and being prudent with uh your debt management and um are in a in a fine position to continue issuing debt if you wanted to to address some of the projects that you consider are a priority. Uh, and I'm going to end with this. And um, I'm so sure people are glad that I've meant the final slide here, but uh, just want to end with this because I think a lot of times in my industry, um, I'm I'm I'm in a tough industry. Um, I have to deal with the word debt and I have to deal with the word taxes and those, especially in Texas, are not very popular. But, um, that's not to say that they're bad or evil or anything like that. It's just, you know, you have to address some of these capital improvement needs for your rate payers or for your constituents to provide them streets, provide them water, what have you. But, um, as I indicated here, and this is not just coming from Victor, your financial adviser, but bond rating agencies and then bond investors as well who are wanting to borrow you, lend you that money. Um, the the city has been doing a good job in its debt management. Of course, a lot of these numbers, 1.4 billion sounds a lot for utility system, some half a billion sounds a lot for your property taxes, but again, it's all relative. It's all based on what we're working with in terms of that revenue source that you have, whether it's the utility system or your property taxes. But the city has been very prudent with this debt management. Uh we in the last 10 years has conducted eight financings on your go side. These are property tax debt. You've saved your taxpayers about $25 million on the utility side. We have more debt out there and uh we've conducted additional refinancings and your rateayers have seen through the city's actions. council and staff uh interest cost savings to your taxpayers of about $111 million. But um I I guess those are the closing things that I want to relay to you. I just wanted to here my job is to give you uh all the facts about where we stand right now, where where we're going to go in the near term and um where we're going to go in the long term. Uh so um the city again is in a very good position and um that was a a lot of probably a mouthful there. So uh but I'll be happy to answer any questions you may have. Thank you, Victor. Very good presentation. We appreciate it. Uh, Councilman Roy. >> Yes. Uh, >> oh, >> thank you for your presentation. So, I want to go back and and I want to look at the slide on page 35, which is basically your security mechanism, and it talks about property taxes under the general obligation utility system. and and and and this kind of stems from a conversation I had at our last uh town hall meeting um last week and there was a question that was brought up to me and I I'm uh so I wanted to kind of discuss this uh when you take a look at Corpus Christi as a whole I think we are a unique city because of the fact that we have these IDA agreements right >> yes >> and you look at uh other cities like Bowmont Houston Um, and correct me if I'm wrong. I think historically IDA agreements, um, I don't want to say that they started in Texas, but I know that a lot of states really don't have these IDA agreements, right? >> Yeah, each state is different because some states, you know, have income tax as a revenue source for municipalities and so we don't and and so yeah, each state is different, but I'm not sure exactly on the genesis of the IDA, but uh, uh, we certainly have one here. So with that, what I was thinking about is that when you take a look at S&P, Moody's and Fitch in terms of how they look at our city in in terms of strengths and weaknesses and and I was in this conversation with a a citizen talking about our 15-year uh IDA agreements as far as the term goes. Do you believe that is does that have an impact in terms of how our credits viewed with the IDA agreements? Does it has it significant? Does it play a role in that at all? Positive, negative, I just want your opinion on that. >> Yeah. You probably saw me smiling in the side because I was smiling at you know thought it was a humorous question but uh that would make me very excited as your bond financial advisor because if those IDAs were swallowed and being part of your uh boundaries and for me as your financial adviser we're structuring your debt. Well, maybe we could afford even more capital improvements using keeping that tax rate the same or maybe we could even reduce that tax rate and still uh take advantage of those property values that that are there. However, you know, um that's just a very selfish viewpoint um uh from my side because you'll be able to afford more because now you have more property revenues that you're going to be collecting on. From a rating agency side, they might view that as a positive because now you're in their ter in their eyes wealthier in terms of the city. And then bond investors too will look at that. Um of course, I can't uh speak for the staff in that uh you know, if you do take those in now, you're required to provide services to them, right? uh as well. So you have to factor that in on the M side. I'm I'm only on the INS side, so it's a very selfish view. Thank you. Um uh but I think it would be a credit positive for the rating agency, bond investors, and Victor if those were in the city. >> Yeah. So what I was thinking is that when they come out with these ratings, I I was wondering, do you get an actual summary in terms of key points that they feel went into why they rated us a certain way? And I just wondered if that topic ever came up and and >> Oh, absolutely. Yeah. So, um, fortunately, you know, my presentation was long enough. I I don't want to really like, um, you know, do away with my job and provide you those actual rating reports. Obviously, you can have access to this public information, but in each of those rating, uh, information or rating reports, um, I joke around that, uh, you know, if you have trouble sleeping at night, you might want to pull up a rating agency uh, credit report because that'll put you to sleep real quick. Um, and so there they identify things and they even talk about things that the city is dealing with and trying to manage and that's your IDA agreements. And so I know this past year was a big year where we had to uh renegotiate those and come to new terms. And so the rating agencies take that all into account because you are still getting those pilot uh payments coming into the city. So that's all a factor of the revenue that they have to measure and conduct. So, u yes sir, that that's a long way of saying that they do take into account the IDAs and they do mention that on the rating reports. >> Yeah. Because the other thing is I was thinking because they were basically challenging in terms of the term, but if we have a 15-year term and we're sitting there, that's 15 years of of I I guess you want maybe I'll use the word stability in terms of we know that that is in place for 15 years. So I just kind of wondered um h how that came into looking at because that definitely is >> part of a security mechanism that we have that other cities in Texas when we comp because we're always comparing oursel how is Corpus Christi related to whatever Austin or >> Midland Odessa or Amarillo whatever love and um so I I thought about that and thanks for your feedback. The other thing I just this is an observation. This doesn't really have anything to do with your presentation, but it does in the terms of when you take a look at what you know when we go out for these bonds and you look at the voters because the voters have the opportunity and you said that anything over 60% is generally pretty favorable. Um because I know that recently we've had a lot of dialogue in in terms of what the people want or what they respect and what they don't want. And I thought it was interesting. And I just want to highlight this that when you take a look at the last bond and even the bond before that that public safety ranks the highest at 74%. So that tells me if I'm looking at this right that the people are definitely behind our public safety initiatives and the officers and fire department and things of that nature. And um at the same time I mean roads roads are significant but they didn't score as high as that. And I just wanted to note that for everybody as I I think that topic's been coming up at council a lot lately. So that's it. Thank you for your presentation. And that's all I had. >> Yeah. Thank you. >> Thank you, Councilman Councilwoman Gmples. >> Thank you, Mayor. Um Okay. Thank you uh Councilman Everett for uh bringing or Roy uh for bringing that up about the IDAs and how it does impact our our bonds and our overall picture, you know, um for the city. So, um just speaking, I I wasn't going to mention that, but I'm glad that he brought that up. So again, uh, Victor, you did say that if these, uh, corporations were part of the city being the value that they are, that it would actually bring even additional, uh, tax revenue to the city. >> I I feel I'm being put in a position. >> Yeah. No, I mean, it's not, but just looking at it uh, you know, you're not >> Yeah. looking at it from just um just from financials because we deal financials, we deal with the the state map and everything and so because if I was a bond investor or rating agency and I'm going to try to dance around this as best as I can. If I was a bond rating agency or investor and I'm thinking about and I live in New York, California, wherever, not in Texas, and um if I was looking at this uh investment opportunity that's uh presented in front of me and I see that the property valuation that the city has to work with is higher than what it was before, whether it's because IDAs are for a corporation coming in, uh that's going to be looked more favorably by the rating agencies. That is not a endorsement from Spiffy or special or special plug finance or Victor about whether you should have IDAS insight or not. You know that's out of my realm of expertise. Uh but um but you know the more values you have within the city the more you could afford and maybe the more um tax rate you could reduce. >> And that that's the basics it is. It's about the more properties that you have in your city and that you can uh evalu evaluate and count that it would naturally bring in more taxes into our city. So that that's basic. Okay. So >> and and just on that note, just real quick, just to have some levity here, I think uh I don't want to open my email box when I get back to the office because maybe industry is going to, you know, have all the uh complaints about me, but no, that's just we're just looking at this on a black. >> It's overall. Yeah. No, I think it it's natural. It it I mean it's just basic knowledge. That's all basic. Okay. So, um the other thing that I wanted to just say was on the uh bonds uh I guess like investing in sidewalks, wouldn't it it actually increase the value of the property? So again, okay, you're asking >> again the same thing. Yeah, I I mean I, you know, because I don't I guess that's not that's out of your purview, but again, that's what I'm I'm thinking that if you uh sidewalks are built around because you're investing in the homestead that it would naturally also increase the value of the property. Just I wanted to throw that out there. I'm sorry, Victor. You're the one that's there. But um >> yeah, I'm a financial advisor, not a political consultant, so don't look to me that I'd be pretty bad at that. >> Yeah. No. Um but uh Okay, so back on to the um Oh, I did want to mention, have you been tracking Senate Bill 10? >> Is this the 1% I I get? Yeah. Yeah, it's >> uh >> has it I don't know. Has it passed or not? No, I think I think that the chances are looking extremely high that that's going to go through. Yeah. >> And that limits your future revenue growth. >> Exactly. Yeah. You didn't mention that, but I guess you know you can't because it's not a certain thing. >> Yeah. Well, well, I didn't I didn't focus on that cuz um it's quite funny, but but on that's going to be more impactful on your maintenance and operation side that uh in your general fund side, you're going to be limited as to how much revenue you could increase each year. And uh to me just because you know obviously I'm I'm advocating for municipalities is that >> uh it it's it's a tough bill because that is a lower bar and and and not it's even lower than what the natural inflation rate is going to be each year because as you know one thing that we can't stop on the finance side is inflation. Uh whether it's high or low inflation is always going to continue. And so that's just my kind of two cents on that. But uh but that's going to be more um impactful on your maintenance and operations side and less so on your interest and syncing f side that I care about because that's what you use excuse me to repay your debt. >> Yeah. I I find it very difficult. I I keep you know I was asking Ryan how where's the mentality on that to introduce a bill that would reduce it so significantly and like you say you know it is basic knowledge that you know prices go up and we have to be able to maintain our you know our streets and our infrastructure so it's very difficult to to accept uh what's going to happen but in order to make that kind of uh bill up. It would have to come back down to probably I guess increasing you know um rates water because we you know the water or uh I'm just trying to figure out where we would get the money. I mean well I guess the water would just be for the water but fees I guess. I don't know. I'm just like it's difficult to comprehend. So I'm trying to figure out where we would actually get the money. So, okay. Oh, and uh I don't know if the public does know about Senate Bill 10. Could you do you >> I'm not an expert. All right. >> I'll let the public there's been news stories on it. So, uh we're aware of it and Heather was in Austin recently following the council's uh legislative priority uh that says, you know, don't uh impact our ability to levy revenues. So, um but it does look like it's going to pass. It's going back to the Senate, I think, um, for an amendment on excluding public safety in that calculation >> and and we're going to have to probably reduce the budget is there is no it's really not >> we can't overfee people to balance the budget. So, it'll be a matter of reducing >> right >> expenditures because 1% growth is uh is pretty slim >> and and because it's happening right now uh and we've been discussing the budget, I I'm just uh putting it out there into the public that if there's any way that they can call their officials and um you know, support and uh against this, please do. Thanks, >> Councilman Hernandez. >> Thank you, Mayor. Um on page 35 you kind of talk about the outstanding debt but you only talk about principal >> correct? Yes sir. >> Uh but you have a couple of slides 37 and 39 that add in the total uh interest as well. So we went from and I'll go back to from the end of last year we uh according to brb.t texas.gov gov. We had outstanding principal a total of revenue bonds and general obligation bonds of 1.65 billion with interest of 841 million for a total of 2.5 billion with regards to what the city owes. And this year we went from a to a total principle of 200 I mean of of two billion and interest of 1.1 billion for a total of 300 I mean $3.1 billion that we owe on a per capita basis that would be 9,917 uh per capita just based on what you provided us in the information. Okay. So, in one year, we've increased our um principal by three and a half $350 million and our total uh money that we owe by 600 million. Is that correct? >> Yes. And that's on the individual slides. That's the most information. Yeah. So, there your your figures are tracking to the information. >> Okay. So, you also had an amount here that was excluded based on the solid waste uh information on the per capita, but I'm assuming we I added that back in when I looked at the total the total debt. How much is too much debt? I look at it from uh bing and let me step back here real quick because um what these metrics that we're showing and it's not like oh we want to show more favorable side. That's not what we're doing. showing you what is industry standard with these uh ratios here on a per capita basis. Whenever we're talking to rating agencies and and bond investors, uh the ratios that they use, and this is just one of a 100 ratios that they use when they're analyzing whether to rate you or invest in the city, this is just one of the factors there um using a per capita per on a debt basis. But what is standard for rating agencies and investors to use is on a per capita based off of the principal amount that you have outstanding because that principal amount is not going to change when once you borrow that money for that principal amount that you borrowed. Uh in this case property taxes, it's about $578 million. Yes, we do have interest to factor in when we're setting the tax rate and that's why we listed that here. And so uh we want to be transparent as possible. the ratios that we're presenting to you here, it's not because we're trying to make the cities look fairable. It's because these are standard industry ratios that we're looking at. So, that's number one. Number two is although the principal amount that you borrow, that's never going to change and you have to pay it back uh or else you'll be in default. What does change here uh if you look at the interest column although it's fixed in that we got a fixed interest rate for the city and if you do nothing with your debt don't issue anymore don't uh uh pay any of these bonds off early don't refinance that interest column is not going to change because we have fixed interest rates so that's good and the stability and you'll be able to plan for it but it could change like it's changed here recently whenever we try to refinance bonds it could go down like we've demonstrated ated with the utility system, it's gone down about $100 million. So, so that's why the the rating agencies and bond investors, they don't focus on the overall debt. They they know that you owe two $578 million in principal. They know you have interest of $500 million and the overall is going to be uh principal and interest. So, they know that. So, what we're trying to show here is just industry standards of how we view this debt. Um, of course, there's state information that you have the principal and interest out there and they factor that in. So that you know, so I just wanted to clarify that what I'm showing you here is industry standard and it's not a sales pitch to make the city look in a better position. Uh rating agencies, bond investors, they know that you owe principal and interest. What they're rating you on is what kind of decisions is the city council, city staff, how are they managing it to be able to repay the principal and interest over that time. Um, you asked about what's what's a good amount of debt. Well, you know, I'm pretty concerned my personal finances and so that's kind of skewed in that way. Um, nobody is a big fan of debt. But when you talk about how much is too much debt, you know, some people have different opinions. I'm sure if you were to ask each individual council person what that figure is, everybody's going to come up with a with a different figure. And so what we look at here with the rating agencies and when they look at all this, how much you have a debt outstanding, when you're going to pay it back, how quickly, how long, um, they're they're rating you on on similar size cities. So there's not a clear numerical number that I could give you about what's too much debt. What we could do is the these rating agencies view the city corpus Christie at a high rating category at the double A. That's a phenomenal rate. um you could go into the market like we was demonstrating you could get a good interest rate and buy a lot of buying a lot of buyers. So when they come up with that rate, they're looking at similar sized cities throughout the country and um the ones that are maybe double A minus, they're probably like that because maybe they have more property values they're working with. Maybe they have a lower debt profile. So the amount of debt is not a one individual indicator about where your rating is going to stand. Uh because these rating agencies when they're viewing you on a comprehensive basis, they are also looking at um are you addressing your capital improvement needs or are you making a decision as a city to defer and delay these project needs. And so a lot of times even though you might have a lower debt amount as a city because you haven't issued as much debt that's telling the rating agencies based off of the other information that you look well why haven't you address your facility needs five years ago it would have cost you $20 million if you continue away because you don't like debt which is fine um it's going to cost you now $40 million. And so those are all the kind of is is I'm what I'm trying to say is that there's different levels. There's a balancing that you have to do as a city about what projects are important to us, how much do they cost now. If they're important to us now, are they still going to be important to us 10 years from now? And if we don't like debt and don't want to issue debt until 10 years now, it's going to cost you more. So you just have to factor that in. And so the rating agencies, bond investors, they look at everything. So that's a very very very long way of saying that. I can't give you a number. What we could say is that if you wanted to go up to the double A plus category uh and you could work on things that you can control and maybe one of those is the debt per capita. Well, what do those cities what's their debt capita? So, we could try to get there. But I just want to emphasize that it's not one ratio. It's not one decision that the council does to want to focus on these rating agencies. They look at you as a whole like we talked about earlier. They look at the fact of, you know, how much of the revenue coming in from IDAS. And so, um, uh, you know, I can't give you an answer, but I can tell you this now is that the rating agencies view you as highly rated, uh, very safe. Uh, and they look at all the debts that you have outstanding principal and interest, and they're still affirming your credit rating at that level. And as demonstrated, we're still able to more buyers than needed to lend you that money so you could address your needs. But, you know, if you look at your debt ratio, you want to reduce it. Well, again, that that's fine, but you're you're making a >> Let me let me rephrase that decision, Victor, because you went on to a long spiel. Yeah. On this. >> I I have a habit of >> So, what what's a what's an upper limit of debt here? I mean, should we go to six billion in debt, 10 billion? What I mean what what is your recommendation as to a good limit as to how much debt as a city based on our revenues based on our the amount of you know per capita we have how much we have assigned how much debt what is exceeding for you that would say hey Corpus Christi maybe that's too much >> you see um and I'm trying to be uh as diplomatic as possible >> you don't have to be diplomatic no be blunt yeah no you're you're my boss blind I am blunt transparent, but I'm trying to say see make it seem like um uh be nice. But >> be nice to straight. >> No, no, no. There there's there's not a number out there because as I indicated earlier, when you view and compare yourself to the top 10 cities out there, it it's not really a good fair comparison because each city is in a different position. >> I'm not asking you to compare the same for us based on what information you have from us. I I think in the current deposition you have the planning numbers that we're looking at in terms of how much you could afford whether it's the utility side your uh property tax side everything is still manageable. I'm the first one that's going to tell my clients, you're overleveraging yourself because I don't want you to get uh reduction in your in your in your in your credit rating and I know that you're going to have future needs and so don't put everything all here at once in the debt because five years from now when other needs come up, you're going to have to address it. But there's not a figure that I could give you and I don't think anybody >> is there a percentage. >> Uh >> Victor, I I think I I I hear where you're going. I hear where you're going. Give us something. >> We hear where you're going, Victor. What you First of all, >> I don't know that you can actually answer that question. And and I understand your position, but but the councilman's point is where are we? Are we nearing that leverage point? Like where are we? Let's just say it's a scale from I don't know one to five where you would you know you like you just said you would tell a client I'm I you know I would never tell them to whatever your statement just was um if you were getting close to that he's trying to find out are where are we in in in terms of getting close to that like >> I'm sorry I'm just uh dancing too much and talking too much but >> you're tap dancing really well. >> Yeah I'm I'm pretty good at it. Yeah. Um I've heard uh so I get asked this a lot not just by the city corpus Christ but other uh clients like what is affordable how much capacity do we have so and I've been doing this a little while I already that part I already uh have a answer for when you talk about debt capacity how much can you afford there's the um legal capacity that you have based off what the state of Texas says you can't exceed your tax rate to repay that debt so we have a legal capacity And then you also have, which is not my realm of expertise obviously, is the political capacity. You're the ones that are going to go to your voters and say, "Hey, we want to borrow $100 million for X, Y, and Z. Um, we could afford it, and it'll the tax rate would be manageable, but that's more of a political um uh decision." Uh, in terms of the legal capacity, if you look at the tax rate here, we're on page 41. Uh, the INS tax rate is 22 cents. your M tax rate is uh 30 close to 38 cents. Um under the state of Texas, we are not even close to the capacity level that you're allowed legally to set to be able to repay your debt. So from my position here, >> stop right there. I want you to stop right there. Okay. So based on that 41, this was leading to my next question. >> Yes, sir. >> In this year's uh legislative session, there was a House Bill 19. >> Yes. >> You I'm sure you're familiar. didn't pass, but it was going to limit the amount of debt as a percentage of your uh property tax revenues or add tax revenues to 20%. >> Based on the numbers we have here of 22 and 38 cents, that's like 30 close to 37% of the of the our tax base revenues. So if we're limited, I mean, we probably should start looking at reducing the amount. And this is just on the general obligation side, on the taxpayer supported side, maybe start to reduce that number because the when we reduced our tax rate from 65 cents down to 60 cents, and I'm rounding um it was all in M, not in the not in INS. So, we should probably start looking at in and I don't know where the city manager went, but we should probably start looking at reducing the the amount on the uh INS, you know, by, you know, reducing that to 20 cents or, you know, working our way down seeing that this is possibly coming and make the plans that way. And if we're going to be limited in how much revenue we can do on on the property tax, maybe that should move to to maintenance and operations. So, maybe a 20 cents and 40 cents. um that capacity. Now, I know that's probably not beneficial for a financial adviser that gets a fee on on selling bonds, but I think we have it's going to be the the legislature that's going to dictate that to us. >> Well, well, in defense of my role and position as financial adviser, um I fiduciary responsibility to the city by federal law and regulations. So, we're a highly regulated industry. Um I don't look at how much Victor is going to make or my firm's going to make. my first and only uh goal because I'm subject to federal law is to make sure that the decisions you make and the way I'm leading you is going to be in the best interest of you and not for me. So just out of defense of my uh industry and myself uh to that. So you asked about what ratio how much is too much. So what I would advise I'm going to try to be diplomatic here too. What I would advise is um because that bill was presented, you know, House Bill 19, the ratios that they're using um nobody knows where they came from. The industry believes it's just, you know, arbitrary. Maybe just try to get it as low as possible. The insertion of that ratio within that proposed bill that didn't pass, and you're right, maybe it can will pass, you know, a couple years from now. And I'm not a financial adviser for it, which is fine. It is what it is. Um the ratio that they use is arbitrary. It it it has no meaning or background when it comes to how rating agencies and bond investors look at a city before they make a decision to lend you millions of dollars. >> Okay. But they're not projects. >> I I don't think believe it's based on whether or not what rate agencies look at. The state legislature looks at it in how we raise taxes or how we increase the no new revenue rate or whatever we call it the fact the tax rate whatever. So what has been happening is they put a limitation on our maintenance and operation. Yes, sir. >> So a lot of cities including us move stuff over to to INS. >> Yes. >> Okay. So now Okay, you're going to do that. We're going to cap you on INS. Okay. So I mean it has less to do with what your >> thoughts are in terms of >> focus on >> what well your industry's you know view of debt with regards to city. They're more looking at it from a revenue perspective and a tax rate perspective. So you mentioned there's the financial side and there's a political side. Yes. >> It's not just us politically that are affected by this. We also have you know state and federal regulations that we have to contend with. So um you know just looking at from their perspective from that lens is what we need to make sure that we keep that in mind not just what u rating agencies uh put forward. >> Yeah. Yeah. That's obviously a individual council decision, but if I could just go real quick to page 43 on the slide. What I do want to emphasize and and you know uh there's a tax rate and then INS tax rate and they want to uh you know dictate or the state does how what amount you could go up or how much you could have. The tough part about the interest and syncing fund tax rate is that for the vast majority of the debts that you're using that tax rate to repay were all voter approved. And so the big um thing that we found with House Bill 19 in our industry was that these voters in 2022 2024 they overwhelmingly said yes city of Corpus Christie you need to issue almost $300 million in debt here to take care of these projects. And so for the state to come and say, you know, let's just do away with what the voters at Corpus Christie said in 2022 2024 and limit how much you could access of this voter approved amount that they gave you may not be fair to all cities. And so the INS tax rate that's pretty sensitive because you could only use that to repay debt and you have to for the most part get voter approval which you all did almost $300 million for these projects. And so that's the that's the sensitivity there and why it's not just a clear ratio that we need to look at in terms of how much that debt we have outstanding. >> I understand. Thank you. >> Councilman Scott. >> All right. Yeah. Let me just run through mine quickly. Um when our IDA agreement lasts how many more years? >> Uh 13 more years. >> Okay. I appreciate the conversation about IDAs, but I think that's a wonderful conversation to have in 10, 11, or 12 years. Um, I also think that we we talk about gross lack of gross income, but it there's a net involved, right? So, if you did take them out of IDAS, then we'd have to provide services. God help us if that happened. My opinion. Um, I I don't know much about the Senate bills or the House bills. Um um I I So when people look at our long-term debt, do they include I I look at I I got the um uh principal and interest repayments. They look at lease long-term lease agreements, too. Is that is it all about long-term liabilities or it's just about debt? >> No, sir. It is about the whole financial operation of a city. So that includes not only the debt repayments that you're making, but you also have legally the uh option to uh pursue what we call lease purchase agreements that are paid from your M side. And so when the rating agencies look at you, yeah, they're focused on the INS side, but they're also really looking at your M side. I know recent discussion the council has what should the general fund balance be? Well, that's one of the many factors that they look at because they're also looking at your M budget. So, so everything you can't um I guess there's nothing to hide from the rating agencies and your financials because they're looking at the whole city. >> I I guess there's there's some ongoing conversations uh about avoiding any additional debt and taking on long-term lease agreements like water. But my point is that still shows up in long-term liabilities and the rate pay the rating agencies are going to look at all that. Yes. Right. And they're gonna it's going to to some extent limit what we can borrow if there is a cap. >> Oh no, not to some extent to a definite extent. Uh that's a if you do those lease uh whatever arrangement it is where you're not issuing the debt for that project and you don't own it but you're part of it and you're making payments on it. U the rating agencies know you still have this other liability even though you didn't issue the debt. Somebody else maybe have issued the debt. But there's no there's nothing's free in life. you know, you you're going to pay for it one way. Either you issue the debt and you make those annual principal and interest payments and you're the owner, or you partner up with another agency that borrows the debt for that project, but you're going to have to sign a contract for them to sell you that product. And in that contract, it's going to have a certain amount of the debt that they have to repay to make themselves whole and make themselves profitable. So either way, both those numbers, the rating agencies are going to know that you have to factor that in in your in your budget to u and and then they determine what your financial health is going to be. >> Got it. By the way, I think you do a great job. Uh but y'all are kidding about dancing around and I just want to note I had a fantastic question that I now have no idea what it was because there's been a lot of dancing, man. I don't know. >> But that's I guess it worked. >> Yeah, that's the strategy. You did a lot of dancing and people forget. Uh I'm going to go uh long-term ID uh pay them back. Oh um I thought it was interesting what you were saying is that we should include IDA payments to because it does offset you know the the you've got this model of debt to to how much per uh per rateayer or per citizen. U but if you if you if you reduce that debt by what IDA commits to it is that what you were trying to say? All right. That's right. If I'm wrong, we'll talk later because I I don't want to take any more time. >> Saying that IDA agreements actually strengthen our credit position. >> That's my point. And >> asking for his opinion. >> Got it. Um, hey, let me just ask it this way. Are So, you you've looked at our CIP, current and future, the 10-year plan. >> Yes. >> Are you comfortable supporting that plan as our financial adviser? the the the amount that's listed there. And I talked about earlier that it's good that you have a 10-year plan, but it's a annual year-to-year decision that you have to make and the staff has to make about whether you could still afford that plan. The affordability factor is on an annual basis and is updated each year. The affordability factor goes back to what our property valuation is as a city. What type of rates are we setting on the utility system? So, the the long-term 10-year plan, I could run numbers to say you could afford it, but then you're going to have to make a separate decision about what type of revenues do we have to increase to be able to continue to afford. What I could say now is that based off of your fiscal year 2026 plans, uh what you need, and also looking in the, you know, two to three year to fiveyear range, uh that's where we would feel comfortable being able to project with could afford it. But uh but yeah, you're you're >> you're comfortable with our 2026 to the five-year plan. I mean, you I've not heard anything from you that says, "Hey, you need to you need to cut that in half or you know that you should only do x amount of that." And that's fine if you do. I think that's what we're looking >> Yeah. And and it really it doesn't really matter what Victor thinks. What matters is the bond rating agencies think. And so we told you that they look at everything. They look at your 10-year plan and they understand you have quite a bit of needs. And so, uh, they reviewed it and they're still rating you at that double A category. And so, it's more important what what they think and but they also realize too, just like I said earlier, it's going to be dependent each year based off what you could afford based off your property taxes. >> So, are you in opposition to this the 2026 CIP plan? Do you support the 2026 CIP plan? >> Uh, so based off of the let me uh qualify the status here real quick. If you could go to if you go to page 45. So this is what I have to work with and I'm grateful that the city provides this uh in advance because I talked about earlier some cities are reactionary. Based off of this I'm comfortable that you could afford it based off of the uh rate settings that you have particularly on the INS side. >> Got it. I got I got it. Um, hey, is it is there some some ratio that's, you know, debt per capita as it goes up and average personal income growth as it goes up? Is there that'd be interesting? Is that do people look at that? That that's got to be part of the affordability factor. And do we have that for Corpus Christi or the Nois County? Is that something we could see? Yeah, that's something that we >> brag about how our personal income growth has gone up through a lot of our economic development work. I'm just be curious to see how it goes with uh you know the debt per capita. >> That's one of the ratios that the rating agencies look at. >> Cool, man. Love to see that. Hey, I think you do a great job. My last note is I I didn't say this earlier, Peter. I think your whole staff has done a fantastic job. This has been a a very good experience for for me and and I appreciate everybody in the room. Just wanted to get that out. Thank you, Mayor. >> You're welcome. Uh, last we have uh, Councilwoman Vaughn. >> Well, I think you did a really good job and you know, Gil, he is the one that just makes the speaker feel uncomfortable and that's just his role. So, thanks mayor for trying to rescue Victor, but you did a really good job, but he had some really good questions for sure. So, I don't have a lot of comments. I just want to say when you hear something good, you said the 10ear CIP was unique. So, that to me that is a it's to you, Mr. Yeah. >> city manager and I think that's good. I think we should compliment you on that because I like looking way down the future. I think that's important for the city to do it. So, I think what you're saying is 2026 plan to Mark's uh comment looks pretty good. >> It's affordable. >> It's affordable. Okay. >> As your financial adviser, fiduciary responsibility, I could >> and you know, that's what you're supposed to tell us. That's one of the reasons we have you. So, director, >> if I may just real quick, uh uh >> you want to back step here? >> Yeah. Uh no, no. uh you know and the reason why I can't say can you afford the full 10-year plan because my crystal ball out of everybody's is the most foggiest uh people ask me what interest rates are going to do in a year from now I don't know I don't know what rates are going to do uh next year same thing with the city its value is the economy you know so it's very hard to project but I know that when we look at this and determine if you're if it's affordable or are we going to be a pos negative position with the rating agencies or bond investors we're going to have difficult time finding a market for those bonds uh the more immediate years are are better I may be able to better measure that and provide guidance to the state that hey maybe we should delay some of this or can we readjust the priorities in terms of when we need that funding. >> Okay. Well, I guess that's a good answer. >> Yes. >> Thank you. >> Yes, ma'am. >> Okay, Victor, you dance well. >> Oh, thank you. No, no. Th this was as as mentioned, those was a really very educational and informative and at the end of the day and I didn't mean to come in and save anybody, but I know where Gil was going with it and I agree. I think it's an important question and it's extremely difficult for you to say, you know, yes, no, or here's the number. And to Mark's question, too, I mean, we just want to make sure as an adviser, you know, we're we're on the right path and we have to balance it. But I really appreciate your your response as to, you know, what is a good place. It depends, right? It's not a good thing when you're delaying. Um I mean, we got ourselves in many years of of of financial issues because of delaying maintenance, etc. So, thank you for doing a great job and thank you for everything you've done for us today. We appreciate >> for having me. Appreciate it. Look, great to see everybody. >> Uh thanks, Victor. So, we're going to move on. It's 11:45. Uh we have the last one, proposed operating budget amendments. >> Yes, this will go pretty quick. This is just a summary of uh of what we have been tracking uh that would change the proposed budget that I presented to council about a month ago. Uh this is just a a kind of a review of it. You'll see the same on Tuesday. There's no vote on this today. It's just a a summary of what we've been tracking. So today would be good if you can if you wanted to provide any feedback on what you see here. Is it did we capture everything? Uh we listed on here the street user fee as as something to continue to be discussed. We think there is consensus on the council to institute it, but we didn't want to presume that. So it's just here to have another discussion today and maybe again Tuesday. Um so that's it. So Amy's going to present this portion of this of the presentation. >> Yes sir. Thank you. Amy Cowi, director of management and budget. Just to recap, we have conducted seven community input sessions throughout the city. The last one was held last night in District 2, and they've all been very well attended. We've had an average attendance of about 40 citizens per session. Consistent across all of these input sessions was a a message that libraries are important, right? And this includes resources and materials for our library staffing and our hours of operation. Um we also heard about um potentially charging for our effluent water reuse program. Um other comments made were related to general uh fees and revenues, parks, parks amenities, pools, senior center programming, industrial district agreements, streets and sidewalks, trees, water security, public safety, and house services and infill housing and storm water. And then we've conducted four city council budget workshops. Our first workshop was August 7th where we went over the general fund, the assumptions in our general fund proposed budget. On our second workshop, you heard from CCW staff on their operating and CIP budgets and proposed rate increases. On the third workshop, you heard from our public works department. And then this is our final and fourth budget workshop. So to go through the budget amendments and again these are the um items that are changing between what we provided you in our proposed budget to what we'll be bringing to you on Tuesday for adoption. This slide is uh specifying those changes that are in the general fund. We also have our schedule of adjustments that lists the same information attached to the agenda item for Tuesday. So, it's available for the public to view there. Um, we had some more detailed reports provided by the appraisal district after the date that we proposed the budget. When we received the detail for our uh TUR properties, we had to make some adjustments. So, you'll see revenues being adjusted down on the turses. We had a slight increase in revenue in the general fund and a slight increase on the geo debt fund. for expenditures. Um, we are removing the 16 part-time positions that were in the proposed budget for the new parks based on the project completion schedule. We shouldn't need those 16 seasonal lifeguards in FY26. That would be a need for the following fiscal year. We're adding 32,000 for the city auditor software that's been requested. We're restoring the 50,000 to libraries for a books and periodicals budget. We're restoring the position to the library. And then we're increasing our transfer to the streets and the residential streets streets funds. This is also due to the um detail received on our appraised values, the certified values. And then we're adding programming for Northwest Senior Center. These amended uh revenues for the general fund in total would be 341,73,752 and then the total amended expenditures would be $346,718,390. In the wastewater fund, we are bringing forward for consideration a proposal to add a fee for the effluent reuse program in the street maintenance fund. The top section are included in the numbers currently uh for consideration on Tuesday, which is the increase to the um street maintenance fund uh per policy. And then we've we're adding 2.72.8 million for tax notes. Um you're you'll see the revenue and the expense here. That is for developer participation agreement funding. And then down toward the bottom half of this slide is what we would propose that council consider is is restoring a street user fee and um associated expenditures. This following slide has a little bit more information on that. Just as a reminder for yourselves in our community, we did have a street user fee that was adopted in July of 2013 and went into effect January 2014. It was adopted for 10 years and it sunseted on December 31st, 2023. And so December 2023 was the last month that we received that revenue for the street user fee. Staff is recommending that we consider reinstating this fee with an inflationary factor. It would be $667 per month beginning January 1, 2026. And that would generate 11.3 million in revenue for use in the street maintenance fund. The residential street reconstruction fund. The amendment that we have here is again related to um the property values slight increase in revenues and this is the uh adjustment to the TUR revenues. TUR 2 would be decreasing um total property tax revenue would be decreasing by 321,000. TUR three it's decreasing 181,000 and TUR 4 is decreasing 186 almost 187,000. We are proposing to add an appropriation for the Corpus Christi Housing and Financing Fund. This fund has not historically been part of our proposed operating budget, but we're proposing to include it based on an item that was brought forward to the board July 29th for consideration in order for have the ability to um authorize that spending. We would include this in the proposed budget for the equipment replacement fund. This is essentially an in and out. We have um included new equipment purchases in the budgets for operating departments. However, we neglected to include that budget in the vehicle and equipment replacement fund. So, this is correcting that. We would be that $4 million coming into that fund is coming out of departments and is already budgeted. And then the 3.3 is the appropriation that we would need to execute that. The engineering fund, this is another correction. We did add 10 positions if you recall in the engineering fund with the proposed budget. As part of that, they do need vehicles and so um the proposed budget did not include this funding for vehicles and we're correcting that with this amendment. Again, this is a slight increase to our property tax budget in the GO bond based on the um property values. This is not an amendment to the proposed budget. Our FY26 proposed budget is not changing for the workers compensation fund. But I did want to bring to your attention that there was an error on that financial statement for FY24 actuals. The column for FY24 actuals had not been updated correctly. And so when we went back and reconciled that, it changed um as you know the ending balance in 24 flows through 25 and 26 to our beginning balance. And so it had an overall impact in what our funds available in ending balance would be in 26. This slide shows our authorized positions. This first position that's removed um from our authorized count is it had no funding impact because we were transferring a position from the general fund to the facilities fund. We did transfer those funds in the proposed budget and we did add the position in the facilities fund. we just neglected to remove it from the count on the general fund. So, this is a correction. Then it reflects the uh reduce 16 part-time positions from parks, restoring the library position, and that amends our total general fund position count to 2,141 positions. There's no change to enterprise fund positions, internal service fund positions, or special revenue fund positions. And so the total proposed operating positions would be 4,074. And then we did have a correction to the health grant funded positions. Um we had it at 31 and it should have been 41. So that increases our total grant funded positions to 92 and total amended city position count to 4,166. This is a nice chart um that shows our position count year-over-year. You can see a five-year history with the previous four years adopted position counts and our proposed position counts. Um on the left side, you'll see the civilian positions, part-time and full-time. And then on the right side, you can see our public safety positions for firefighters and police officers. And of note, you can see that we did increase police officers and firefighters by five each in the proposed budget. Our next steps, well, today we're here to review the amendments that we're bringing before you on Tuesday. Um, these items that you've seen in this presentation are reflective of the feedback we've received from yourselves and from the community in the last month. The one item that's not included in the budget for Tuesday is that street user fee that we hope to hear from you today some direction. And then on Tuesday, September 2nd will be our first public hearing and reading of the budget. That agenda that's posted, like I said, does have that schedule of adjustments. Um, and it's posted on uh our our legisar system. any changes from the discussion today uh we would bring forward to you on Tuesday for consideration and then on September 9th we do have a public hearing and second reading on the budget where we hope to adopt the FY26 budget. Just a reminder the budget must be balanced. So any changes one direction would need to have an offsetting change in the other direction. The new fiscal year starts on October 1st and any again any amendments would need to really have a net zero impact on our overall financial statement. Thank you so much. >> Thank you Amy. >> Uh Carol, uh Councilwoman Vaughn, >> just a couple questions. Okay, on the libraries, so you've got what was the position that you're restoring? Where was the library? Which library was that? This was the branch manager at the heart library. So that position will be restored and the department is looking at how to best utilize that position knowing that there were still some operational changes there. >> So how many positions are over there now? How many do you have >> at the heart library specifically? >> I'm not sure ma'am. I'd have to get that for you. >> Laura, the library director can help on that. Laura Garcia, library director. Uh we just have one manager position which is vacant and then we have four library assistants and a youth services librarian. >> So you have four library assistant >> assistants. Yes. >> One that's vacant. >> The manager position is the one that's vacant. >> And that's the one you're filling. >> Yes. >> Okay. How big is that library? >> Uh like square footage. Just >> I'm curious how big it is. About >> 13,000 square feet or so. >> Okay. And you're saying you're restoring books? What's that exactly mean? Restoring books for the libraries. >> That that would be the position. What was also cut was the books and periodicals um collection funds. >> Oh, >> and it's not just for that location. That one is actually housed at the Laura Tama Library, the the fund itself. And from there, we distribute to the other branches to the other five branches as well. Yeah, Councilwoman, the the proposed budget reflected what the school district was uh suggesting uh how we modify hours, >> which I think cut them more than in half. But since that time with Councilwoman Paxton, we've been in the community and we've restored quite a few hours. In fact, if we if we open that branch on Sunday, it will be almost restored to what it was prior to the reduction in hours. >> Okay. So the the reduction in the book budget was reflective of it being open less, but now we're probably open about the same. So we're saying let's restore the book budget. Same with the position. It was a branch manager and Laura's uh it may not be a branch manager per se, which is a higher level, higher cost position. It may be something in between uh what what you know some of the positions there and the >> it'll all be dependent like the city manager saying on the the hours that we finally settle on. Uh but that's the individual that oversees the branch. um does the collection for that branch and so forth supervises the um the staffing and so forth. >> Okay. It's just been such a big issue. I want to make sure I understand it because it'll probably come back up. Okay. Thank you, Mr. Cen. So, have you got all the positions filled? Do you keep them on the budget thing? The positions you don't have filled that you're wanting to fill. >> Uh what we do nowadays is we we reduce the salary line item. Mhm. >> So if a department has a pattern of having certain number of positions vacant, it's not the same one, but this turnover factor that happens. >> Uh we reduce the total amount of of personnel services uh budget to be reflective of patterns we see year-over-year. So take public works as some of those frontline uh uh you know, street street uh production crew crew positions are hard to keep filled because of the toughness of the job. It doesn't mean the same positions vacant for 12 months, but people come and go. And so there's a natural turnover rate. Okay. >> And so we reduce the personnel line item budget to reflect that. So we're not funding personnel at 100%. >> Yeah. >> It's a lesser amount based on patterns of vacancy rate. >> Okay. Yes. Okay. And my last one was on the grant funded total over there for um wait not yeah health grants correct error positions. Explain what is that? I mean it's grant oper operate. Let's see. grant funded total proposed positions. >> This is what we got the grant for. So, we keep them as long as we've got the grant. >> Correct. And this doesn't change the total dollar amount associated with those grants. It was a clerical error in our position schedule. Okay. >> It was we put it in the proposed budget as 31, but it should have been 41. >> 41. Okay. Thank you. >> Yes, sir. >> Councilwoman Compass. Uh thank you, mayor. Um well, I just want to also say thank you to the staff, uh to everyone for all your hard work. I really we I really do appreciate it. And I also wanted to just say that, you know, yesterday we held our last uh input session. And um and one of the things because it it was the last and it's so close to us already voting on the budget, which is next week for the first reading. uh it really came to mind about you know how much uh we really would um like to include some of the suggestions or some of the desires that the community actually has. So I um you know I stated last night I would like to see us start way earlier with the input sessions. Um I think staff starts you know looking at the budget I don't know in March. But I am grateful that Mr. Zenoni uh did bring that uh as as one of the you know tenants you know when you uh um were hired here is to bring the input session. So I'm I'm really grateful for that. But I think um just like the um public comments, you know, we made some few changes and I I feel like it's improved. We probably can still improve some more, but I think I'd like to see us uh go, you know, a lot sooner than later. I would like to see it in March, but that's just my preference. Um, I also just wanted to uh ask about I know it's not it wasn't part of the library budget per se, but there w it was mentioned last night about the social worker that uh was housed there. I don't know if that's still going on at at the Ratama, but that person was, I believe, helping, you know, some of some individuals and they were really taking advantage of that. Is that still going on? >> So, so we have a partnership with Texas A&M Kingsville, their social work program. And so during the school sessions, um, if we get someone that wants to come and do like their practicum and so forth, uh, that's where they come. And we've done that for about maybe now 3 years. >> And so they come during the uh sessions, the school sessions, and they provide a certain amount of hours depending on what they need. And so we do uh let the individuals know that they are there um they're not a yet a they don't have their degree yet, but they're working towards it. And like I said, it's part of a practicum that we've been doing with them. >> And so it just depends. Sometimes they'll provide maybe 20 hours a week. It just depends on what's needed. And so one of the things that we have looked at um and and and yesterday actually got someone else that did from I think there's a program also at Delmare and they also want to try participate. So we're working through that. We have looked at we will be looking at trying to see if there's any type of grant program out there. At one point the state library was providing grants towards something like that but I haven't recently looked to see if that's still a possibility. >> Okay. Well thank you for that Laura. Um and I also just wanted to mention about the um vacancy rate. Um yesterday I uh had my my meeting with uh Ernie Deagarsa and he just mentioned how uh Manuel had done a video about um you know vacancies in for the city and how they were able to fill a lot of those positions. I understand I just heard Mr. Zenon say that, you know, that the public works is is difficult to fill, but I'm not sure if that's exactly the case, but I'm just saying that um, you know, as far as I know, you know, it does help, you know, to just go outside the box to fill some of these positions because we have them budgeted. I mean, you know, and you know, that would provide would provide a job and, you know, would help everybody. So, >> yeah. Council woman. Yeah. Just to make make sure I was clear. So, it's not necessarily difficulty to fill, >> but it's sometimes difficult to retain uh once somebody actually gets in that work environment where it's 100 feels like 110, then you're dealing with 200°ree asphalt. And >> so, folks can tend to say, "I can't wait to get this job." Then when they get in it, they're like, "Oh my god, I need to get to the next job." Okay. >> So that's also some of the positions have challenges just because of the rigor, the toughness, the >> the elements that we can't control like the temperature and the temperature of the asphalt. >> Uh but we try to make accommodations to make their workplace uh tolerable or enjoyable to include having shelter in place breaks with shade and >> yes >> and and drinks uh like Gatorade, that type of thing, right? So naturally, you know, there's a there's a toughness in some of these jobs, tougher than others. And so our job is to overcome that and try to make it as accommodating as we can. But even then sometimes it's you know it happens >> well and and I just appreciate that department uh because of that you know because it is >> it's not for everyone you know to be out there like that. Uh and um and I know that that department uh and I'm sure all the different departments does maybe I don't know but show their appreciation. I I've been invited um since I've been elected to their annual I guess appreciation uh barbecue or lunchon or something and it's just so nice to see the camaraderie there and the appreciation and and so again you know thank you uh to all the departments but especially uh public works. So thank you. >> Thank you councilwoman. A couple of things I I I agree. I think that it's a little too um close together. Whoever ends up being I guess you'll do we do it in order. No, we don't do it in order because that would have been five. Um the the input sessions, her input session was the last one, right? And then you already have this planned out and I don't know that that really is enough time. I think it's it's important, right, that we have enough time for the input to really be taken into consideration. So maybe we can move those up or you know, I don't know. And the other thing I think they're great, you know, the input sessions, we didn't have them before as was mentioned. >> Well, we have seven too now, you know, >> but I think when we have 300,000 people in a city and you have 40 people on average that attend these, >> we're not really hearing everyone. And I know that's a very difficult thing, you know, to do, which is why now we've implemented the uh >> the text text messaging. But that's why it's so important for that to grow because if we were able to text people, can you imagine how much input we would really get about here's where I'd like my tax dollars to go or this department, not this department. We would just get so much more input and we really this is really about hearing from as many people as possible. So, I I would just challenge you, Peter, to to think about or have staff think about how else I understand we have to grow the base as far as texting, but how else can we reach more people, you know? I mean, most people, you know, they work, they get home at 5, 5:30, 6, they have kids, they're that's their priority. 40 people showing up. Hey, 40 people, that's great. I'd love to know the ages of those 40 people. um because it's difficult when when you have families, but there's got to be we can come up with a better way to reach more people to hear how they feel about the bud their their tax dollars being spent. Just a challenge for staff. >> That's good. Yeah, we're improving every year. So, as an example, we had five districts that we went to, now we do seven. Uh we've modified the program to make it more familyfriendly um from time to time. You know, last year, as an example, we had that eating establishments, that type of thing. Uh but I would submit that most cities, they struggle. It's not just our city with citizen participation in a lot of topics including the budget, but that doesn't mean we don't continue to try. So, uh we did do a survey as a reminder early this year and the results were pretty consistent with what we heard um out out there on the districts and our town hall meetings. Uh but we can move um we can move some of the engagement earlier in the process. >> Yeah. >> And and see as well. So we we appreciate the challenge and and we'll we'll as we've done every year make adjustments uh to uh better meet the needs of the community and get more engaged. The age group at our workshops was pretty diverse. It was uh young 18y olds to retired seniors and so and in between there were parents there that said I have x number of little kids at home and um so it's it's not just a particular age group which was nice to see. um at all seven of them was a pretty wide range of of age spectrum which we like to see. >> How was the survey done? >> What was that? >> How was the survey done? >> The survey early in the year was a was a uh phone survey, Heather or >> online survey. An online survey. We I think we >> talked to the council about it in what was that in March or >> It was in May. May >> in May. Yeah. >> Yeah. It it was a it was a not too long of a survey, but it said if you had um it it asked them to kind of develop their own budget if those >> basically to write priorities. >> Yeah. Yeah. So >> yeah, that was just that was a new thing we did this year and and that helped it guided us in the in the recommendations and the budget for the council >> or maybe like utility bills. But anyway, that's just my little challenge there because I'd just love to see more people >> Absolutely. >> get involved. >> Okay. Council uh Councilman Hernandez. >> Yeah. So, with the changes that you're recommending, did was there any changes to our own reserve balance in the general fund? I think we had it about 180,000. >> Minimal. It actually increases slightly because of the adjustment to general fund revenues. Okay. The expenses were offset by that. >> Okay. I know uh uh the city secretary's office was short about $53,000. So, I want to add that back into the the budget that they uh that they needed for because I think it's going to reflect on um the personnel that are in there and holding something open for a certain period of time, but that might affect the the assistance we have for council, >> right? >> So, I want to make sure that I mean it's not a significant amount. >> We can restore that. >> So, please please >> Yeah, we'll put that on for Tuesday. >> Okay. there was a it was a position that would be um partially unfunded for the year, but right >> given that we got a little bit more property tax with the final roll uh that'll allow us to restore that. >> Okay. And secondly, uh I I'll say this again. I'm not for reinstituting the uh street user fee onto the utility bill. There are no protections on the utility bill if you don't pay them. Right? Unlike unlike uh property tax where you have some protections for people over the age of 65 or people that are over or are disabled, there's no protections on the utility bill and we have a lot of upward pressure from water, wastewater, and storm water on the utility bill. I don't want to add more to that. Uh I would recommend us going and asking for to whether it's a referendum or whatever. Uh we still have those two cents that we can go back and get ask for and if we need to ask for more than that, then we we should do a referendum. We could do it in May if we need to, but I I think it should be through the normal process of of um of funding it through the general fund through our normal funding levels, not creating something that may prevent people from being able to pay their utility bill. >> Yeah. >> Okay. That's that's my opinion. Thank you. >> I agree with that. Okay. There being no further um questions, I want to thank everybody, staff, all the directors, everybody that that uh did you have something? >> I just didn't know. I saw Council Paxton lights on. I already turned your light on. That's why. >> Thank you, Peter. Let me scratch that. Go ahead. >> No, real quick. I know some of the feedback that we saw was um suggestions to hold yes the public input sessions a little earlier but some on the weekend and and my thoughts were going to something like maybe in the mornings at the parks doing combining things like those um really great parks and Rex days that we have where we have the amphitheater in full swing we have some bounce houses things like that not not necessarily to to make a full event out of it but to just really embrace that community element, get get multiple things that accomplished at one time. And I think we had I feel like we may have spoken in the past about the survey um being you said there's an an a section in there that's kind of build your budget, but I think what I'd like to see in in most of our surveys if we um were to embrace a little bit more open fielded type questions because I think sometimes when we kind of get in these assumptions of categorizing things we there's a lot more of the story that maybe we don't think of. And and I think I like those open fields to be really included so people can can flesh out ideas organically. >> And just so you know, we did have one field where we asked, "Is there anything else that you'd like to share with us or that you'd like us to know?" And and we did receive quite a few responses. >> Excellent. Well, thank you for your presentation today. >> Yeah. Thank you. >> Yes, Sylvia. Good. Uh I I just would like to add to that about the the different options that hopefully we'll be discussing about the input sessions, but it kind of would be nice to have like one big general input session, just at least one, you know, where I know it's different districts, but I'm just saying, you know, sometimes if you know you've only got that last chance that it's for even though we know it's for different districts. Yeah. I'm just saying like to have like a big buildup and say this is the last big venue, you know, the best event that you can attend and, you know, really publicize it. >> There is a city there's a required public hearing at city council in this room. And so that's one example. >> Uh but I would agree with you all especially if the if the state caps our revenues at 1%. Tough choices are going to have to be made >> because there is no more revenue. So we're talking about do we cut what? Parks, animal care, libraries, >> and and how So, the community really is going to have to come out and help you and us on what what do we want to keep? That's the question. If we're capped at 1% revenue, >> then we don't, you know, and property taxes are one of only two revenue sources of significance in the general fund. >> So, more than ever, we have to do this call to the community like we've been talking about at our library meetings >> and they've been coming out and we so we need to hear them and so we'll be especially doing that next year. >> Yeah. As a matter of fact, last night, you know, it was mentioned she saw it in the news just like an hour before or something. You know, it was just she saw it and and she came. So, you know, we always could do a better job at advertising and getting it out. And like you say, maybe in a utility bill, >> right? And that's the challenge. I think we do a better job just getting the word out. We can't always reach everyone, but I think we could do better than 40. >> Yeah, we agree. So, that's why we'll keep working on it. >> Yeah. Thank you. All right. So, thank you to staff. Thank you to everybody. Victor, thanks for being here today. All these uh the three presentations were great, very educational. Um and we will look to wrap this up uh next week. >> Yeah, next Tuesday. We do have this uh we did get a comment this morning from one of the council members to reconsider the agenda for next week in terms of what gets done first. But just we did put the budget on the agenda first for next week, but that's you know, >> I saw that. Yes, I was going to talk with you. Yeah, because we also have some other big items next week on the agenda as well. But >> okay, >> but what this gives you today is this is what will be presented on Tuesday. So we'll have you have between now and Tuesday to you know to talk it over, call us if you have questions. Uh we got the two amendments from today's meeting. One to restore the secretar's position and secondly to add a CIP page for uh the evangeline project. We'll put that in 27 for now FY27. And so that page will be in the budget so people can see it and have reference to it. And then if there's any other changes, just let us know. And and of course, we'll be here Tuesday to collect those as well. Okay. >> Um, hang on. >> Let's see here. Actually, since we're online, we should probably make that change now so more people can hear it. >> Which one was that? >> Well, we can't change, right? We can't make changes to the to the agenda. >> Oh. Uh, no. The agenda is posted, but you >> That's what I mean. The posted. >> Yeah, but you can, as you know, the chair can um modify. >> No, I know. But I'm talking about we can't change the agenda. >> We cannot change it. No. By state law now, it's it's posted and it's posted and we can't change it. It has to be um how many days? >> Three. It has to be posted three business days prior to the meeting. >> Right. >> Yeah. >> Can we talk about moving it to >> Well, no. But I I think and I agree with you. I think um I just people are looking at the agenda. That's the hesitation. They're looking at the agenda now. We can't change it. And those items are what numbers? >> Uh the the the desalinization item and the loan are the towards the end of the agenda because the individual >> towards the end right after a whole lot of budget terry items. So I I would like to move them forward and and this might be a good um opportunity since we're online um to let the public know um and maybe put it out there. Again, my concern is people that are looking at the at the agenda saying, "Oh, they're not going to be >> Yeah. Let me just ask real quick. Can Can the content of if we're not changing the content, just the order, could you repost it or?" >> Well, I would say that it's not uncommon for the council to uh change the item the order the items they um review. I mean, it's it's commonly done. >> Yeah. The question is, can we repost the >> No, no, it's already posted. That's that's posted. >> Okay. Okay. Hey, mayor. We'll do what we did uh similarly, which is we put a news release out, and I I forget what it was to say we're going to consider these first. >> Yeah, >> Councilwoman Bonnie has a good point. We're we're reading each other's eyes, but >> we we get >> trashed up here. And if they do not know, I mean, they've been watching that agenda. If they do not know, we're going to do that. But I agree, I wish it had been up further, but if they don't know, they are going to get ticked off. Keep >> it the way. >> Just an just an idea. Hey, if y'all don't mind I'm coming up here. I'm used to it now. It doesn't bother me. >> Well, Councilman had it was it was a suggestion and I think it was it was a good one because we all know how long the day is. >> Put your um Yeah. >> I just feel like this vote is the biggest vote that we're going to have on our political career. So, so I just want to make sure, you know. >> Okay. So, you want to We can leave it. >> Let's just leave it then. >> Let's just leave it. Um >> it's on you, Caroline. >> Take some breaks. Okay. All righty. Well, there being no further business, this meeting is now adjourned.