Aug 08, 2024 Special Council

[00:00:02]

IT IS 9 A.M..

[1. DECLARATION OF A QUORUM AND CALL MEETING TO ORDER (Room 204)]

GLAD TO HAVE EVERYBODY HERE.

WE GET COFFEE.

YOU GRAB ME A WATER, ANYONE? NO. I'M FINE. GOOD MORNING EVERYONE.

IT IS 9 A.M..

I'M OFFICIALLY CALLING THE WORKSHOP FOR THE CITY OF GALVESTON COUNCIL TO ORDER TODAY.

AND GLAD TO HAVE EVERYBODY HERE.

WE HAVE A FEW STAFF MEMBERS HERE.

WE GOT VERY IMPORTANT TOPIC TODAY.

THAT'S WHY WE ONLY HAVE ONE ITEM ON BASICALLY ON OUR WORKSHOP.

AND THAT IS TO DISCUSS THE BUDGET.

SO, FOR THOSE THAT ARE IN THE COMMUNITY, MAYBE WATCHING THIS.

GLAD TO HAVE YOU WITH US.

AND PLEASE ENJOY THE BUDGET DISCUSSION.

JANELLE, WE DO HAVE A QUORUM, BUT COULD WE HAVE A ROLL CALL? VERY GOOD. WE DO HAVE A QUORUM TODAY HERE.

BEFORE WE START ON OUR DISCUSSIONS TODAY, I WANT TO GO OVER WITH COUNCIL AGAIN.

SOME DETAILS ON THE AGENDA HERE.

WE'RE GOING TO DO ITEM THREE A HERE IN ROOM 204 WITH OUR BUDGET DISCUSSIONS.

THEN WE'LL MOVE FOR ITEM FOUR THROUGH FIVE B.

WE WILL MOVE TO COUNCIL CHAMBERS FOR ACTION AND SO FORTH THERE IN COUNCIL CHAMBERS.

THEN WE'LL MOVE FOR ITEM SIX, WHICH IS OUR EXECUTIVE SESSION.

WE WILL MOVE BACK TO ROOM 204 HERE.

THE MUSIC STOPS AND YOU DON'T HAVE A CHAIR, YOU'RE OUT.

THAT'S RIGHT. JUST OTHER HOUSEKEEPING CHORES, JUST TO MENTION THAT ON ITEM SIX, IT'S LISTED 6A1. WE HAVE OUR CITY MANAGER, OUR CITY ATTORNEY, AND OUR CITY SECRETARY.

WE WILL BE DOING OUR EVALUATIONS.

I'M CHANGING THE ORDER.

OUR CITY ATTORNEY HAS SOME COMMITMENTS THAT HE HAS TO BE AT, SO WE'LL BE TAKING THE CITY ATTORNEY WHEN WE GET TO THAT TOPIC, WE'LL BE TAKING HIM FIRST. VERY GOOD.

SO, WE ARE MOVING FORWARD.

LET'S READ ITEM THREE A PLEASE, MA'AM.

[3.A. Discussion Of The FY 2025 Budget And Capital Improvement Plan (C. Ludanyi - 45 Min)]

CSILLA LUDANYI, OUR CITY FINANCE OFFICER.

CSILLA, GO RIGHT AHEAD.

GOOD MORNING. SO THE PRESENTATION IS KIND OF BIG AND LONG TODAY, AND WE CAN MOVE AT WHATEVER PACE COUNCIL WOULD LIKE.

IF YOU HAVE QUESTIONS, FEEL FREE TO INTERRUPT ME AND I'M HAPPY TO ADJUST AS WE NEED TO.

IF MY SUBJECT MATTER ISN'T THE ONLY THING WE WANT TO DISCUSS.

SO, TO START WITH, I WANT TO REVIEW THE SCHEDULE FOR THE ADOPTION OF THE CIP.

TODAY IS AUGUST 8TH.

AND SO, CSILLA, COULD I INTERRUPT YOU? I APOLOGIZE BEFORE YOU START HERE, COULD YOU.

I KNOW IT'S ON OUR AGENDA FOR FIVE B TO APPROVE A PROPOSED PROPERTY TAX RATE.

WOULD YOU OUTLINE TO COUNCIL WHAT THAT MEANS? THAT'S. GO RIGHT AHEAD.

SO, THERE ARE THREE ITEMS THAT COUNCIL HAS TO COMPLETE IN ADOPTING A TAX RATE.

THE FIRST IS APPROVAL OF A PROPOSED TAX RATE WHICH SETS THE HIGHEST TAX RATE THAT YOU ARE PERMITTED TO ADOPT.

OKAY, SO IT'S BASICALLY SAYING THIS IS THE HIGHEST TAX RATE.

WE CANNOT ADOPT ANYTHING HIGHER THAN THIS.

AND THAT'S BECAUSE THAT'S THE TAX RATE WE NOTICE TO THE PUBLIC.

OKAY. AND THAT NOTICE IS COMPLETED BASED ON THE APPROVAL OF THAT PROPOSED.

THEN WHEN WE ADOPT THE BUDGET, WHICH WILL BE SEPTEMBER 12TH, YOU HAVE TO RATIFY THAT SAME TAX RATE TO SAY, HEY, OR WHATEVER TAX RATE YOU CHOOSE, YOU RATIFY IT. AND THAT'S SAYING, HEY, WE'RE GOING TO APPROVE THIS TAX RATE, THIS IS WHAT WE'VE SELECTED.

AND THEN FINALLY AT THE MEETING ON THE 19TH, YOU WILL VOTE ON AN ACTUAL ADOPTING OF A TAX RATE.

BUT PART OF IT IS TO BE TRANSPARENT AND TO NOTICE THE PUBLIC ABOUT THAT DECISION MAKING PROCESS.

BUT SO THE VOTE TODAY IS SIMPLY TO SET THE BAR ABOVE, WHICH WE WILL NOT GO.

AND ALSO, WHEN WE WILL.

LET ME EXCUSE ME FOR LET ME FINISH THAT THOUGHT.

ALSO, ALONG THOSE LINES, WHEN IT COMES BACK TO US ON THE 12TH OR THE 19TH, WE HAVE TO APPROVE THE BUDGET FIRST, THEN APPROVE THE TAX RATE. SO, THE WAY IT FLOWS.

SORRY, MARIE, GO AHEAD.

SO, SINCE WE'RE JUST RECEIVING A LOT OF THIS INFORMATION TODAY, IF WE'RE NOT PREPARED TO SET A TAX RATE TODAY.

[00:05:03]

WELL, BUT YOU'RE NOT SETTING A TAX RATE TODAY.

YOU'RE JUST SETTING IT NOT TO EXCEED TODAY.

YEAH. AS SHE JUST DESCRIBED, THIS.

IS TO NOTIFY THE PUBLIC THAT AS COUNCIL DEBATES THE REST OF THE BUDGET AND THE TAX RATE, IT WILL NOT SET ANY RATE HIGHER THAN THE ONE THAT IS NOTICED, AND THAT'S WHAT WE'RE DOING TODAY.

THAT'S THE 42 CENT ONE.

YES. THE 40 2A3, A TWO.

OKAY. GO RIGHT AHEAD.

ALL RIGHT. SO, ON THE 22ND RIGHT NOW, THERE IS NOT PLANS TO DISCUSS THE BUDGET.

IT'S JUST A REGULAR COUNCIL MEETING.

HOWEVER, BASED ON PROGRESS IN THIS MEETING, IF COUNCIL SO CHOOSES, WE CAN PREPARE TO DISCUSS THE BUDGET SOME MORE ON THE 22ND AS WELL.

AND THEN, AS I MENTIONED PREVIOUSLY ON THE 12TH, WE PLAN TO HAVE THE BUDGET PUBLIC HEARING AND THE TAX RATE PUBLIC HEARING, AS WELL AS THE BUDGET ADOPTION AND THE TAX RATE RATIFICATION, SAYING, HEY, IN A WEEK, THIS IS A TAX RATE WE PLAN TO APPROVE.

AND THEN ON THE 19TH, BY THEN, HOPEFULLY THE BUDGET IS APPROVED AND ALL THAT YOU WILL BE APPROVING ON THE 19TH IS THE TAX RATE.

OKAY. SO, I WANT TO GIVE YOU A LITTLE HISTORY BECAUSE WE'VE HAD A LOT OF MOVING PARTS SINCE OUR LAST MEETING AND WE'VE BEEN PIVOTING AS EACH NEW RENDITION COMES OUT.

SO, ON THE 23RD, WE RECEIVED A CERTIFIED ESTIMATE.

WE STILL HAVE NOT RECEIVED THE ACTUAL CERTIFIED TAX ROLL.

GALVESTON COUNTY APPRAISAL DISTRICT HIT SOME BUMPS IN THE ROAD WITH HURRICANE BERYL JUST LIKE THE REST OF US AND SO THEY HAVE NOT SUBMITTED A CERTIFIED TO US.

BUT BY STATE LAW, IF THEY SUBMIT THE ESTIMATE TO US BY THE 23RD, WE ARE ALLOWED TO SET THE TAX RATE BASED ON THAT.

AND THE ESTIMATES, THE 95%.

THE ESTIMATE, SO THEY THE ESTIMATED ROLL THAT THEY PROVIDED US WAS 93%.

95% WOULD ALLOW THEM TO CERTIFY.

OKAY. THAT'S GREAT. SO, ON JULY 24TH, WE RECEIVED THE FIRST TRUTH AND TAXATION CALCULATION FROM GALVESTON COUNTY TAX ASSESSOR COLLECTOR.

AND THEN ON THE 25TH, WE HAD OUR MEETING WHERE WE STARTED THIS DISCUSSION.

ON THE 30TH, WE RECEIVED A CORRECTED COLLECTION LETTER AND A NEW CALCULATION.

AND THAT WAS SIGNIFICANT BECAUSE THE COLLECTION RATE WAS DECREASED FROM OVER 100% TO 99%.

AND THAT IMPACTS YOUR VOTER APPROVAL RATE AND YOUR DEBT SERVICE RATE.

SO WHEN THEY MADE THAT CHANGE, IT INCREASED THE DEBT SERVICE RATE, THE LEGAL DEBT SERVICE RATE, AND THEREBY THE VOTER APPROVAL RATE.

BUT IT ALSO DECREASES BY VIRTUE OF THAT, THE MAINTENANCE AND OPERATION RATE, IF YOU HOLD THE RATE STEADY.

AND SO AFTER ANALYZING THAT AND UNDERSTANDING WHAT IT WOULD DO TO THE MAINTENANCE AND OPERATIONS SIDE OF THE EQUATION, WE WENT WITH THE VOTER APPROVAL RATE TO PROCEED WITH THE REST OF THE BUDGET IN ORDER TO FUND THE THINGS THAT WERE DISCUSSED AT THE 25TH MEETING, AND THAT AT THAT TIME, THE VOTER APPROVAL RATE WAS THE 428382. SO ON AUGUST 2ND, THE TEXAS COMPTROLLER CHANGED THE CALCULATION FOR THE UNUSED INCREMENT, WHICH IS ESSENTIALLY WHEN THEY DID.

TRUTH AND TAXATION. THEY ALLOWED US TO KIND OF COLLECT THE AMOUNTS THAT WE DIDN'T EVER CAPTURE UP TO THE VOTER APPROVAL RATE.

SO, IF YOU SET A TAX RATE BELOW THE VOTER APPROVAL RATE THAT DELTA, YOU'RE ALLOWED TO KIND OF PUT IT IN YOUR BANK FOR THREE YEARS, AND THAT'S THE UNUSED INCREMENT PORTION.

AND SO, THEY CHANGED THE WAY IT WAS BEING CALCULATED.

AND THEREFORE, THE ONCE AGAIN WE GOT A NEW CALCULATION FROM THEM.

AND AT THIS POINT THE VOTER APPROVAL RATE INCREASES TO 0.30530.

BUT WE'RE HOLDING STEADY AT THE PREVIOUS RATE WE SET, BECAUSE WE BELIEVE THAT FUNDS THE BUDGET THAT WE HAVE PROPOSED FOR YOU.

SO I'M HAPPY TO ANSWER ANY QUESTIONS.

BUT I WANTED TO KIND OF BOIL THAT DOWN AND SIMPLIFY THAT, BECAUSE THERE'S A LOT GOING ON THERE JUST TO HOW DOES THE LEGISLATIVE CHANGE THAT WAS DONE CONCERNING EMERGENCIES IN THE THREE YEAR LEEWAY ON THAT? BUT COULD YOU EXPLAIN THAT? SO WHEN THERE'S A DISASTER, THE CITY HAS THE OPPORTUNITY TO REQUEST THAT THE TAX ASSESSOR COUNT OR CALCULATE THE TAX RATE WITH A DISASTER AMOUNT THAT ALLOWS US TO GO UP TO AN 8% CAP INSTEAD OF A 3.5% CAP.

CORRECT. WE HAVE NOT ELECTED TO DO THAT AT THIS POINT.

AND SO THE VOTER APPROVAL RATE THAT HAS BEEN CALCULATED HERE IS AT THE 3.5%.

AND WE ARE NOT AT THIS POINT DOING ANYTHING TO EXTEND THE TAX RATE AS A RESULT OF HURRICANE BERYL.

THANK YOU. SO THIS SLIDE IS GOING TO GIVE YOU A COMPARISON OF WHAT WE'RE LOOKING AT THIS YEAR COMPARED TO WHAT IT WAS LAST YEAR. OKAY.

THE IMPORTANT ITEMS TO REALLY LOOK AT IS THAT OBVIOUSLY THE PROPOSED RATE, WHICH WE HAVE IN YELLOW, THE 428382, AND HOW THAT COMPARES TO OUR RATE IN 2024. THE FOURTH ONE DOWN IS THE VOTER APPROVAL TAX RATE.

AND SO THAT IS ACTUALLY VERY COMPARABLE BETWEEN THE TWO YEARS.

[00:10:04]

AND THE NO NEW REVENUE TAX RATE I'M SORRY.

THAT'S THE SECOND ONE ON THERE IS ALSO VERY COMPARABLE.

SO WE'RE WE ARE IN LINE WITH WHAT WAS GOING ON LAST YEAR WITH SLIGHT DECREASES IN THOSE RATES BASED ON THE INCREASES IN VALUE.

THE ONLY OTHER ITEMS TO NOTE IS THE SALES TAX RATE OFFSET, WHICH PART OF THE SALES TAX RATE IS USED TO OFFSET GROWTH IN PROPERTY TAX REVENUE.

AND SO THAT HAS DECREASED A LITTLE THIS YEAR.

AND THAT'S A RESULT OF THE FACT THAT SALES TAX HAS BEEN LOWER IN THE LAST 12 MONTHS THAN PREVIOUSLY.

AND THEN THE TAX RATE CAP PER CHARTER IS THE CHARTER REQUIRES THAT WE DON'T INCREASE THE TAX RATE MORE THAN 5% ANNUALLY.

AND SO THAT CAP FOR 25 WOULD BE THE 429293.

ON THE RIGHT HAND SIDE, YOU'LL SEE HOW THAT TAX RATE IS SPLIT UP.

THE GREEN GOES FOR MAINTENANCE AND OPERATIONS.

THE BLUE IS THE $0.05 THAT WE'RE REQUIRED TO SEND TO THE LIBRARY.

AND THERE'S AN MOU WHERE THEY SEND US A LITTLE BIT BACK ON THAT TO MEET OUR GROWTH AS WELL.

AND THEN THE DEBT RATE IS THE YELLOW PORTION AT THE VERY BOTTOM YOU'LL SEE KIND OF AN ORDER THAT NO NEW REVENUE RATE ON THE LEFT HAND SIDE OF THE 0.391198 ARE PROPOSED RATE AT THE 428382 THE CHARTER CAP, AND THEN THE NEW VOTER APPROVAL RATE THAT WAS SENT TO US ON MONDAY. THE CHARTER CAP IS AT 5%, THE CHARTER CAP IS 5%.

GROWTH OVER THAT 408850 FROM LAST YEAR.

CSILLA, WOULD YOU MIND EDUCATING COUNCIL A LITTLE BIT ON THIS SALES TAX OFFSET? SO, THE STATE LEGISLATURE HAS CREATED A SITUATION, THE TRUTH AND TAXATION CALCULATION, WHERE A COUNCIL, A CITY, CAN CHOOSE TO USE SALES TAX TO OFFSET PROPERTY TAX.

AND IN DOING SO, YOU'RE REQUIRED.

ONCE YOU'VE MADE THAT DECISION, YOU'RE REQUIRED TO TAKE A PORTION OF THAT SALES TAX AND YOU'RE ESSENTIALLY CALLING IT PROPERTY TAX.

SO IF YOU WEREN'T DOING THAT, YOU'D HAVE THE SALES TAX REVENUE ON ITS OWN, AND YOU'D BE ABLE TO TAKE YOUR PROPERTY TAX RATE UP HIGHER.

GALVESTON HAS CHOSEN TO USE A PORTION OF THAT SALES TAX TO OFFSET PROPERTY TAX.

WHAT'S THAT? AND MORE STATE LAW TAX LAW TERMS. WHAT'S THAT CALLED. JUST JUST A SALES TAX OFFSET.

IT IS THE SALES TAX OFFSET.

AND IT'S IN YOUR COUNCIL PACKET.

ON THE CALCULATION YOU'LL SEE THAT I THINK ON PAGE SEVEN YOU'LL SEE HOW THAT'S CALCULATED.

BUT IT'S PART OF THAT CALCULATION THAT THE TAX OFFICE DOES FOR US.

AND THAT'S A PERCENTAGE ISN'T IT.

IT IS A PERCENTAGE.

IS IT SIX. I BELIEVE IT'S 6%.

YES OKAY. YOU CAN USE UP TO 6%.

AND THAT'S CHOSEN.

THAT'S DONE BY COUNCIL. CORRECT.

COUNCIL AND POSSIBLY THE VOTERS.

RIGHT. IS THAT IN THE CHARTER? I BELIEVE THAT, YES.

YEAH. THE VOTERS HAVE TO CHOOSE TO DO THAT.

A LOT OF TIMES WHEN THEY INCREASE SALES TAX, PART OF THE DEAL IS OKAY, IF YOU'RE GOING TO TAKE UP SALES TAX, WE WANT IT TO APPLY TOWARDS OUR PROPERTY TAX.

OKAY. AND ESPECIALLY IN A CITY LIKE GALVESTON, WITH ALL THE TOURISM THAT WAS PART OF THE OPTION WHEN THE CITIES OPTED INTO THAT.

WHEN WAS THAT? OH, GOD.

A LONG TIME AGO. 80S.

OKAY. GALVESTON COUNTY DID NOT OPT INTO IT.

SO YOU TAKE A HIT IN YOUR SALES TAX AND THEN YOU'RE BURDENED BY YOUR PROPERTY TAX.

YEAH. AND. WELL, AND IF YOU HAVE WHAT HAPPENED THIS YEAR WHERE OUR SALES TAX DROPPED, YOU STILL HAD THE OFFSET LAST YEAR.

SO, YOU'RE JUST SOL.

SO BUT I MEAN RIGHT NOW OUR SALES TAX IS FLAT.

BUT WE KNOW JUST BY THE NATURE OF HAVING TWO STORMS IN A ROW, OUR SALES TAX IS GOING TO BOUNCE BACK UP AGAIN BECAUSE I COULD JUST CALCULATE THE NUMBER OF VEHICLES EVERY MORNING.

NO, WELL, JUST GOING IN 90% OF MY STRUCTURES HAD DAMAGE AND THAT'S ALL GETTING REPAIRED.

AND YOU WOULD THINK WE WERE GIVING SOMETHING OUT FOR FREE.

IF YOU LOOK AT THE NUMBER OF VEHICLES HEADING WEST AT 61ST STREET.

SO, YOU KNOW, THAT'S GOING TO BOOST OUR SALES TAX, EVEN THOUGH IT IS A SAD WAY TO HAVE IT DONE.

WHAT WE DON'T KNOW IS HOW THAT SALES TAX IS GOING TO REBOUND FROM THIS BECAUSE IT I THINK THERE'S NO DOUBT IT WILL REBOUND.

WILL IT OFFSET ALL THE OTHER LOSS OF SALES TAX WE HAVE I DON'T KNOW.

I MEAN WE'RE HEARING REPORTS OUR BUSINESSES ARE DOWN 4,050%.

SO IT'S GOING TO TAKE A LOT OF FENCE PICKETS TO OFFSET THAT.

HOW MUCH IS THIS THE FULL 6%? YES. YEAH.

SO, WE GALVESTON USES THE FULL OFFSET AND THAT'S 6.7 PENNIES BASICALLY.

IS THAT SALES TAX OFFSET THIS YEAR? OKAY. OKAY.

AND THAT'S A WIN FOR THE CITIZENS HERE TOO.

BECAUSE MOST OF YOU, YOU KNOW, 50% OR MORE OF YOUR SALES TAX COMES FROM PEOPLE WHO VISIT THE ISLAND.

[00:15:04]

WHEN PEOPLE TALK ABOUT TOURISM, THAT'S KIND OF THE ONE THAT PEOPLE OVERLOOK A LOT.

OKAY, SO IN OUR DISCUSSIONS COMING OUT OF THE MEETINGS LAST MONTH, WE WANTED TO PRESENT THE ENTIRE COUNCIL WITH A PICTURE OF WHAT WE ARE FACING WITH THE BUDGET THIS YEAR. AND SO, WHAT YOU HAVE IN FRONT OF YOU AND I'M GOING TO TALK THROUGH THIS SLOWLY.

AND WHEN YOU ALL HAVE A QUESTION, JUST PLEASE INTERRUPT.

SO, THE REVENUE, THE TOTAL REVENUE IN THE GENERAL FUND INCLUSIVE OF PROPERTY TAX AT THE NO NEW REVENUE RATE.

SO, IF WE USED THIS YEAR'S CALCULATED NO NEW REVENUE RATE, THE TOTAL REVENUE WOULD BE ABOUT $78.78 MILLION.

OKAY. THE EXPENDITURES IN THE GENERAL FUND WITHOUT OUR PERSONNEL IMPACTS THIS YEAR WOULD BE ABOUT $78.8 MILLION. SO THERE'S A SLIGHT DEFICIT, BUT NOT ONE THAT WE COULDN'T OFFSET OKAY POTENTIALLY.

BUT WHEN WE LOOK AT ALL THE PERSONAL PERSONNEL ITEMS THAT WE DISCUSSED AT THE LAST MEETING, WE WANTED TO GIVE YOU AN IDEA OF HOW THAT INCREASES THE EXPENDITURES RELATED TO THAT, NO NEW REVENUE RATE, REVENUE STREAM.

THE CBA AT THE 1.3 MILLION.

THE POLICE CBA AT 1.3, FIRE CBA AT 467.

THE CIVILIAN COLA WE'VE ADDED AT THE 4% AS REQUESTED.

THAT'S $728,000 IMPACT IN THE GENERAL FUND.

THE EMS CONTRACT, WHICH IS PREDOMINANTLY FOR SALARY INCREASES FOR EMS PERSONNEL, IS 747 AND THEN HEALTH INSURANCE IN THE GENERAL FUND IS ABOUT $676,000 IN IMPACT.

THESE ARE INCREMENTAL OVER OCCURRING.

OVER LAST YEAH OVER 24.

CORRECT. FAR FROM TOTAL.

WHEN WE'RE LOOKING AT THE COLA ARE WE DOING THAT CROSS-BORDER.

ALL EMPLOYEES AND WE ARE AND MANAGEMENT AND SO FORTH.

EVERYBODY IN THOSE FUNDS.

YES. SO, THIS IS JUST THE GENERAL FUND NUMBER.

HOWEVER, WHEN WE PROPOSE A CIVILIAN INCREASE, IT'S ACROSS THE BOARD FOR ALL THE FUNDS EXCEPT THEIR IMPACT IS WITHIN THEIR SPECIFIC FUND, WHETHER IT'S WATER OR SEWER OR AIRPORT, THAT SORT OF THING.

I HAVE SOME THOUGHTS ABOUT THE COLA.

FIRST OF ALL, THANK YOU FOR PUTTING THE 4% IN THERE.

I HAVE SOME THOUGHTS, BUT I'M GOING TO HOLD THOSE BECAUSE YOU MIGHT GET INTO THIS.

IT HAS A BEARING ON THE DEBT, THE RESERVE FUND, THINGS LIKE THAT.

OKAY. SO THE EXPENDITURE IN THE GENERAL FUND, WITH THE ADDITION OF ALL OF THESE PERSONNEL IMPACTS IS THE 82.7 MILLION AND AT THE TAX RATE OF 428382, WHICH IS WHAT WE'RE PROPOSING, THE ADDITIONAL REVENUE IS ABOUT $3.8 MILLION.

AND SO WITH THE ADDITIONAL REVENUE FROM THE ADDITIONAL INCREASE IN THE PROPERTY TAX, IT TAKES YOUR REVENUE UP TO THE 82.5 MILLION.

NOW, THIS IS SHOWING A DEFICIT OF ABOUT 140.

WE'VE LOOKED AT SOME OF THESE ITEMS AND I THINK WE CAN ADJUST ON IT.

WE CAN MAYBE ADJUST ON LONG TERM PARKING A LITTLE BIT, OR WE CAN ADJUST ON THE CRUISE REVENUE A LITTLE BIT, BUT THOSE ARE THINGS, VACANCY RATE. THERE ARE SOME SMALL ADJUSTMENTS WE CAN MAKE THAT WE FEEL LIKE ARE CONSERVATIVE ENOUGH THAT THEY WON'T BE CONCERNING NEXT YEAR, UNLIKE SALES TAX.

AT THIS POINT, I FEEL UNCOMFORTABLE REALLY ADJUSTING ON THAT.

SO, WE FEEL LIKE WE CAN FILL THIS $140,000 BUCKET.

CSILLA, WHERE IS THE ONE? WHERE IS THE 1.5% FOR THE FIRE PENSION? IS IT INCLUDED IN THE FIRE CBA OR IS THAT NOT EVEN ON THE LIST? IT'S INCLUDED.

OH, THE 1.1% THAT WE'RE DISCUSSING, OR 1.5% THAT WE'RE DISCUSSING IS INCLUDED IN THE FIRE CBA, RIGHT? OKAY. I'M GOING TO MAKE GO BACK TO SALES TAX, HOT TAX.

SO, I WAS TALKING WITH THE PARK BOARD YESTERDAY, AND EVERYONE KEEPS SAYING THAT SHORT TERM RENTALS ARE DOWN AND THEY'RE BACK UP AGAIN. THERE'S ACTUALLY I THINK I ASKED JANELLE TO SEND OVER TO Y'ALL THE NUMBER OF YOU SENT THAT OUT THIS WEEK. YEAH.

AND SO NOW HOT TAX AND HOT TAX AND SHORT-TERM RENTAL ARE BACK TO 5050.

WHEN YOU LOOKED AT JANUARY OR FEBRUARY THE SHORT TERM RENTALS WERE AROUND 38%.

BUT I REALLY THINK A LOT OF THAT WAS DRIVEN BY THE FACT THAT MARDI GRAS WAS IN FEBRUARY.

SO PEOPLE WERE COMING IN FOR PARTIES, THEY WERE STAYING AT HOTELS.

BUT IT IS AS OF THIS POINT BACK TO 5050, WHICH THEN THAT WOULD ALSO HAVE A POSITIVE EFFECT ON OUR SALES TAX. BUT ON SHORT TERM RENTALS WERE OVER 50%.

THEY WERE, BUT THEN THEY DIPPED DOWN.

[00:20:01]

THEY DON'T HAVE THE LATEST NUMBERS, BUT WE, SO WHAT'S HAPPENING NOW WITH A LOT OF SHORT-TERM RENTALS JUST SO PEOPLE KNOW BECAUSE IT DOES AFFECT OUR NUMBERS, IS IN THE WINTERTIME A LOT OF PEOPLE ARE MAKING THEM LONG TERM RENT, NOT LONG TERM BUT WINTER IN TEXAS THREE MONTHS.

YEAH SIX.

SO IT'S NOT A HOT TAX.

STILL PEOPLE COMING SPENDING MONEY, BUT COME.

AND IT HAPPENED IN FEBRUARY AND I JUST PERSONALLY KNEW THIS BECAUSE I WANTED TO MOVE INTO A SHORT TERM RENTAL BECAUSE OF OUR HOUSE CONSTRUCTION, AND THERE WASN'T A SINGLE ONE TO BE FOUND COME MARCH.

BUT SO NOW IT'S BACK TO WHERE IT WAS LAST YEAR AND IN MAY, IN THESE NEW NUMBERS, BE BACK TO WHERE IT'S A HIGHER PERCENTAGE.

WE ALSO HAVE MORE.

NOW THERE'S I THINK IT'S I CAN'T REMEMBER OFF THE TOP OF MY HEAD, 4700 WHERE AT THIS TIME LAST YEAR WE WERE AT 4500.

BUT THEY ESTIMATE THAT THERE'S REALLY 4900 WITH 300 BEING ROGUE THAT AREN'T PAYING TAX.

SO JUST TO MAKE YOU AWARE, WE'LL SEE THE IMPACT OF ALL OF THAT ON BOTH SALES TAX AND HOT TAX.

RIGHT. YEAH. BECAUSE WE'RE GOING TO [INAUDIBLE] IN THIS YEAR GUYS.

YEAH. AND BACK TO YOUR QUESTION, BRIAN, I'M NOT ENTIRELY SURE IF THAT FIRE NUMBER INCLUDES THAT.

I DON'T THINK IT DOES.

AND SO I WILL GET YOU MORE INFORMATION ON THAT.

IT'S IN THE BUDGET, BUT I DON'T THINK IT'S INCLUDED IN THAT CHART.

I DON'T THINK I THINK THAT'S NOT ON MY CHART.

IT'S AN AMOUNT CLOSE TO THAT AMOUNT.

YEAH. IT'S ABOUT 170,000 ADDITIONAL.

SO THE ONE OF THE FIRST THINGS THAT YOU HAVE IN THE BUDGET BOOK IN FRONT OF YOU, AND ONE OF THE REASONS I DO THE POWERPOINT THIS WAY IS SO THAT YOU KIND OF HAVE A GUIDE TO LOOK AT THAT BUDGET DOWN THE ROAD WHEN YOU'RE NOT SITTING AT THE TABLE, BUT SO EACH SECTION IS NUMBERED BY LETTERS SPECIFICALLY BECAUSE WE DON'T COMPILE IT ALL TOGETHER THIS FIRST GO ROUND, BUT IN THE VERY INTRODUCTORY SECTION IS PAGE ONE IS WHERE YOU GET YOUR TRANSMITTAL LETTER FROM THE CITY MANAGER TO GIVE YOU AN IDEA OF WHAT THE VISION IS FOR THIS BUDGET. AND ONE OF THE VERY FIRST TABLES YOU SEE IS THE CITY WIDE TABLE THAT SHOWS YOU WHAT THE GENERAL FUND, SPECIAL REVENUE, DEBT SERVICE AND ENTERPRISE FUNDS, ALL THOSE MAINTENANCE AND OPERATIONS, WHAT THAT'S COSTING AND WHAT THE CHANGES ARE YEAR OVER YEAR.

YOU'LL SEE THAT THERE'S A OUR BIGGEST INCREASE YEAR OVER YEAR IS IN IN OUR CAPITAL BUDGET.

AND A LOT OF THAT HAS TO DO WITH THE DRAINAGE PROJECTS THAT WE ARE PROPOSING TO START IN EARNEST THIS COMING YEAR OR START CONSTRUCTION ON.

AND SO WE'RE SEEING WE'RE PROJECTING A 40% INCREASE IN THE CAPITAL BUDGET.

OVERALL. THE BUDGET YEAR OVER YEAR IS CHANGING FROM ABOUT 434 MILLION TO 512 MILLION.

BUT WE'RE ALSO TAKING A PORTION OF THAT OUT OF THE IDC SILOS, WHICH WE HAVEN'T DONE IN THE PAST.

SO THAT LIGHTENS THE BURDEN.

SOME. YES.

ALTHOUGH THE $20 MILLION THAT THE IDC IS CONSIDERING ISSUING OR THE CITY IS CONSIDERING ISSUING THE IDC WILL BE PAYING FOR, IS NOT INCLUDED IN THIS BUDGET BECAUSE YOU ARE LEGALLY NOT ALLOWED TO BUDGET FOR DEBT THAT YOU HAVE NOT ISSUED.

OKAY. SO.

DO YOU? YES, YES. AND WE KNOW THAT WE HAVE THE ABILITY TO PROVIDE FOR IT, OTHERWISE WE WOULDN'T BE ISSUING IT.

SO, AS WE LOOK AT THAT CITYWIDE SUMMARY, WHICH IS YOUR NEXT SECTION AFTER YOUR INTRODUCTORY SECTION, YOU HAVE THE BUDGET SUMMARY SECTION. WE CALL THAT THE CITYWIDE.

THERE ARE A COUPLE IMPORTANT THINGS THAT I WANT YOU TO CONSIDER ON PAGE THREE OF THE SECTION AFTER BUDGET SUMMARY TAB.

SO IT'S CW THREE AND THIS IS YOUR CITY WIDE TABLE, WHICH SHOWS YOU THE BEGINNING FUND BALANCE REVENUE.

WHAT PAGE IS THAT AGAIN? PAGE THREE. PAGE THREE AFTER THE BUDGET SUMMARY TAB.

OH THANK YOU.

AND THIS BUDGET WILL BE POSTED ONLINE AS SOON AS THIS MEETING IS OVER AS WILL THE POWERPOINT.

SO ANYBODY IN THE AUDIENCE CAN GO LOOK AT IT TOO, IF THEY NEED BEDTIME READING.

IS THAT THIS TABLE? DO A RUNDOWN OF ALL OF THE FUNDS THAT THE CITY IS BUDGETING, STARTING WITH THAT BEGINNING FUND BALANCE, WHICH IS A REALLY IMPORTANT THING, AND THAT ENDING FUND BALANCE BASED ON WHAT WE'RE PROJECTING TO SPEND.

OKAY. ON IF YOU FLIP THE PAGE, CW FOUR IS IMPORTANT BECAUSE THERE'S A CHARTER LIMITATION ON THE GROWTH OF THE BUDGET.

AND SO, WHEN COUNCIL CHECKS THOSE CHARTER REQUIREMENTS, THIS IS WHERE YOU SEE US CONTROLLING FOR THE GROWTH OF THE BUDGET WITHIN THE GUARDRAILS THAT ARE ESTABLISHED IN THE

[00:25:05]

AND IT ABSOLUTELY IS.

AND I JUST WANT TO MAKE SURE THAT COUNCIL TAKES A GLANCE AT THIS LOOKS AT OVER YEAR OVER YEAR.

RIGHT NOW WE'RE DOWN, PER THE LAST REPORT, ABOUT 4.4%, WHICH AS I'VE MENTIONED, IS ABOUT $1 MILLION.

AND THAT'S WHAT'S IMPACTING OUR YEAR END FUND BALANCE.

I JUST LOOKED AT IT THIS MORNING BECAUSE THE SALES TAX ACTUALLY PUBLISHED YESTERDAY, AND I DIDN'T HAVE A CHANCE TO LOOK AT IT.

AND IT LOOKS LIKE WE'LL BE DOWN TO 4.8% OF MONTH.

WAS IT? SO, TODAY'S THE AUGUST IS RELATED TO JUNE.

SO, IT'S BEFORE BARREL AND ACTUALLY THE JUNE YEAR OVER YEAR NUMBER IS GOOD.

IT'S A SMIDGE.

IT'S LIKE 0.6% HIGHER THAN IT WAS LAST YEAR WHICH IS GREAT.

BUT IT WASN'T ENOUGH TO OFFSET WHERE WE NEED TO BE YEAR TO DATE.

AND SO WE'RE PROJECTED TO BE DOWN 4.8%.

BUT IT IS AN INTERESTING THING WHEN YOU LOOK AT IT BECAUSE WE KNOW BUSINESS WAS DONE IN THE END OF JUNE BECAUSE OF ALBERTO.

SO, AND I MEAN, YOU COULD HOPEFULLY IT MEANS AN UPWARD TREND BECAUSE WE KNOW WE LOST AT LEAST AND DON'T GET HUNG UP ON IT BEING JUNE BECAUSE PEOPLE'S REPORTING VARIES.

THERE MAY BE A LOT OF MAY NUMBER IN THAT TOO.

WELL, IN JULY WE'LL BE WAY BEHIND BECAUSE THEY ALLOWED THEM TO EXTEND.

YEAH. I DON'T THINK YOU'RE REALLY GOING TO KNOW THE FULL IMPACT OF BARREL SALES TAX WISE UNTIL PROBABLY OCTOBER.

YEAH. YEAH.

SO, IF YOU TURN TO PAGE CW SEVEN THROUGH TEN AND THAT'S BACK A LITTLE.

OKAY. ONE OF THE IMPORTANT THINGS THAT WE DISCUSS IN THIS SECTION IS THE PROPERTY TAX RATE SETTING PROCESS.

AND ESPECIALLY AS WE MOVE ON TO DISCUSS THAT PROPERTY TAX RATE AT VARIOUS POINTS IN THIS CONVERSATION, THIS IS AN IMPORTANT AREA FOR COUNCIL TO REVIEW.

IF YOU HAVE QUESTIONS HEADING INTO THOSE MEETINGS ON THE 12TH AND THE 19TH, AND I'M HAPPY TO ANSWER ANY QUESTIONS OFFLINE.

BUT YOU'LL SEE THE TRENDS. YOU'LL SEE THE OUR INITIAL VALUE FOR THIS YEAR WAS SET AT 13.9 MILLION.

AND THERE WAS THE PERCENT LOSS WAS ABOUT 19.4 MILLION.

SO ALMOST 20% AGAIN THIS YEAR.

AND SO OUR NET TAXABLE VALUE IS 11.2 MILLION.

AND THAT IS THE VALUE ON WHICH THE TAX RATE IS BEING CALCULATED.

THERE'S STILL A LOT IN PROTEST TOO.

SO YES. YEAH.

WHEN OBVIOUSLY WHEN THE WHEN WE RECEIVE THE CERTIFIED ESTIMATE ONLY 93% HAD BEEN CERTIFIED.

AND THAT'S SIGNIFICANT BECAUSE ONLY 80% OF THE VALUE HAD BEEN CERTIFIED.

SO, THERE WAS IN THAT 7%, THERE WAS 20% OF THE VALUE.

YEAH. SO, THERE'S SOME BIG, BIG ITEMS IN THERE.

SO IT ONLY TAKES 1 OR 2 BIG ITEMS TO REALLY THROW YOU INTO A TAILSPIN, EVEN THOUGH THEY'RE CERTIFYING 93, 95%.

IF IT'S IF THOSE ARE 1 OR 2 BIG ITEMS, THEY CAN REALLY THROW THE TAILSPIN.

AND SO, THIS THIS SECTION IS A GOOD 3 OR 4 PAGES.

AND IF YOU HAVE ADDITIONAL QUESTIONS ON PAGE EIGHT, YOU'LL SEE OUR BREAKDOWN OF HOW THAT TAX RATE IS CALCULATED.

YOU'LL SEE THE PORTION THAT WE ANTICIPATE GOING TO THE LIBRARY, WHICH IS ABOUT $6.1 MILLION THIS YEAR BASED ON THE TAX RATE.

AND A PORTION OF THAT WILL COME BACK TO THE CITY.

BUT IT'S BASED ON THE CITY'S INCREASE.

SO I WANT TO SAY WE'RE PROJECTING ABOUT 1.4 MILLION COMES BACK TO THE CITY.

BUT OVERALL, THE AMOUNT THAT THE CHARTER REQUIRES IS ABOUT 6.1 MILLION, WHICH, AS YOU SEE, IS HIGHER THAN OUR DEBT SERVICE.

SO IT'S IMPORTANT TO UNDERSTAND THAT RELATIONSHIP WE SPEND.

YEAH I MEAN THAT'S A GOOD.

CW EIGHT. YEAH.

IT'S A GOOD COMPARATIVE THAT WE SPEND YOU KNOW WHEN PEOPLE ASK YOU WE SEND MORE MONEY TO THE LIBRARY THAN WE SPEND ON OUR DEBT FOR OUR.

YES. BASED ON THE CITY INCREASE, CLARIFY THAT.

SO THERE IS A QUESTION.

SO WHAT? BASED ON THE CITY INCREASE.

CLARIFY THAT FOR ME.

SO THERE IS A CALCULATION WHICH IS REQUIRED BY STATE LAW.

THAT'S ON THE VERY FRONT PAGE OF THE BUDGET OKAY.

AND IT SAYS THAT THIS BUDGET WILL RAISE REVENUE FROM PROPERTY TAXES FROM LAST YEAR BY A CERTAIN AMOUNT AND BY A CERTAIN PERCENT AND THAT PERCENT, THAT 11.16, WHICH IS WHAT WE HAVE BASED ON THE CURRENT TAX RATE THAT WE'RE PROPOSING, IS THE PERCENT WE WOULD USE TO CALCULATE WHAT THE LIBRARY IS ALLOWED TO INCREASE.

AND SO ESSENTIALLY WHAT WE'VE DONE IS WE HAD A NUMBER BACK IN 2021.

AND OUR GROWTH IS BASED ON THAT BASE NUMBER.

IT'S NOT YEAR OVER YEAR.

SO, IF IT WAS JUST BASED ON LAST YEAR'S TOTAL REVENUE, THEN THEY WOULD GET THE SAME AMOUNT OF MONEY.

BUT WE'VE BEEN CREEPING IT UP BY THAT PERCENT THAT WE'RE INCREASING OVERALL.

SINCE THAT 21 NUMBER.

AND THERE'S A CALCULATION FOR THAT THAT I CAN SHARE WITH EVERYONE IF YOU'RE INTERESTED.

[00:30:01]

SO WE CAN LOOK AT IT IN A MINUTE IF THERE ARE FURTHER QUESTIONS ON HOW THAT'S CALCULATED, CW 19 IS THE BUDGETED POSITIONS. SO JUST TO UNDERSTAND THAT WHILE OUR PERSONNEL COSTS ARE INCREASING AS A RESULT OF THE ITEMS THAT WERE DISCUSSED EARLIER ARE BUDGETED, POSITIONS ARE ONLY GOING UP BY FIVE YEAR OVER YEAR.

AND ALL OF THOSE ARE IN OUR ENTERPRISE AND INTERNAL SERVICE FUNDS.

AND SO THERE ARE NO POSITION INCREASES.

THERE'S A POINT SEVEN POSITION DECREASE IN THE GENERAL FUND, AND THE INCREASES ARE OCCURRING IN OUR OTHER FUNDS.

AND GO OVER CSILLA AGAIN I THINK JUST BE A GOOD TIME.

WHAT IS OUR PERCENTAGE OF PERSONNEL EXPENSES FOR ADMINISTRATIVE COMPARED TO OUR GENERAL FUND BUDGET? ABSOLUTELY. SO THAT IT IS 3.1%, I BELIEVE, THIS YEAR.

BUT THAT CALCULATION CAN BE FOUND.

I FEEL LIKE YOU ASKED ME THAT QUESTION LAST YEAR, AND I DIDN'T HAVE IT NOTED IN MY PRESENTATION ON WHAT PAGE IT'S ON.

IT WAS FOUR SOMETHING LAST YEAR, I THINK.

YEAH, IT'S GONE DOWN.

IT'S GONE BECAUSE SPECIFICALLY BECAUSE IT'S CALCULATED BASED ON TO INCLUDE SPECIAL REVENUE AND THE SPECIAL REVENUE AMOUNTS HAVE INCREASED.

IT DEFINITELY PUSHES DOWN THAT ADMINISTRATIVE NUMBER.

AND IT'S 3.1 THIS YEAR.

AND I WILL FIND THAT PAGE NUMBER AND LET YOU KNOW WHAT IT IS.

SO IF WE MOVE ON TO THE NEXT SLIDE THIS IS SPECIFIC TO THE GENERAL FUND.

SO WE'RE MOVING TO THE TAB THE GENERAL FUND TAB.

AND MOVING BEHIND THAT.

AND IN THE GENERAL FUND ON PAGES ONE AND TWO YOU'RE GOING TO SEE THE SUMMARY OF THE REVENUE AND THE EXPENDITURES ON THE REVENUE SIDE.

JUST TO REITERATE, PROPERTY TAX IS ABOUT 50% OF OUR REVENUE.

SALES TAX IS ABOUT 28%.

AND THEN THAT OTHER NON TAX REVENUE AT THE 7% AND OTHER TAXES IS 7%, ARE THE TWO AREAS THAT FALL IN LINE AFTER THAT.

THAT IS ALL INCLUSIVE OF THE MONEY COMING BACK FROM THE LIBRARY AT ABOUT 1.4 MILLION.

IT INCLUDES THE LONG-TERM PARKING AND IT INCLUDES THE CRUISE PASSES.

THE NON-TAX.

IS THAT THE OTHER TAX? THAT'S OTHER TAXES.

THE NON-TAX IS GOING TO INCLUDE THE CRUISE AND THE LONG TERM PARKING, THE LIBRARIES, OTHER TAXES.

SO THAT'S THE OTHER NON-TAX.

YES. IT'S VERY CONFUSING I KNOW.

OKAY. AND DOLLAR WISE FOR CRUISE FOR TARIFF AND PARKING.

YOU'RE PROJECTING ABOUT 2.5.

THAT'S CORRECT. IS THAT WHAT THE INCREASE IS OR IS THAT KIND OF JUST THE WAY THINGS ARE? THAT'S AN INCREASE. YEAH, IT'S AN INCREASE YEAR OVER YEAR.

YES. WAS THAT INCLUDING THE NEW SHIPS AND OKAY.

PERFECT. YEAH. ISN'T THAT STILL VERY CONSERVATIVE.

IT IS, ALTHOUGH MSC WILL ONLY COME ONLINE.

YEAH, IN 26.

AND SO, THERE'S GROWTH PROJECTED.

BUT IT'S VERY HARD TO KNOW WHAT THAT'S GOING TO LOOK LIKE.

KEEP IN MIND NOVEMBER OF 26 IS OUTSIDE YOUR 25 BUDGET.

SO YEAH, I UNDERSTAND THAT.

BUT BEFORE EVEN MSC COMES ON, ISN'T THAT NUMBER STILL CONSERVATIVE? PROBABLY A LITTLE BIT.

SO, A TINY BIT A TINY, WE CALCULATE THAT IN THE WARS BOARD EVERY MEETING EVERY MONTH.

SO WHERE IS IT NOW? IT'S THE EXACT AMOUNT YEAR TO DATE, I DON'T KNOW.

BUT PROJECTING OUT FOR THE END OF THE YEAR, IT'S GOING TO COME IN AROUND PROBABLY 2.7.

YEAH. POSSIBLY.

THE PROBLEM IS, YOU KNOW, WHEN WE HAD WITH BERYL.

YEAH. YOU LOST A LOT.

THAT KIND OF TOOK A DIP ON SOME OF THAT.

THAT'S ONE THAT YOU, I DON'T FEEL COMFORTABLE PLAYING TOO LIBERAL WITH BECAUSE IT'S, THERE'S SO MANY SO MANY VARIABLES THAT CAN AFFECT THAT PARKING. AND I THINK ONE OF THE CONCERNS IS WHEN WE'RE LOOKING AT PERSONNEL COSTS BEING THE DRIVER OF OUR INCREASES, IT'S A LITTLE CONCERNING TO BUDGET INCREASES AND PERSONNEL COSTS ON A REVENUE SOURCE THAT NOT RELIABLE IS NOT RELIABLE, RIGHT.

WE'RE MAKING COMMITMENTS INTO THE FUTURE RELATED TO PEOPLE.

AND THEN THE REVENUE STREAM DOESN'T COME IN AND THEN WE'RE IN A BIND.

AND SO IT'S JUST GOOD TO HAVE THESE DISCUSSIONS AND UNDERSTAND WHAT THE RISK IS.

AS WE TALK ABOUT THE OPPOSITE SIDE OF THAT, IT'S BETTER TO LOOK AT THAT FOR CAPITAL EXPENDITURES.

ABSOLUTELY. YEAH.

I'M JUST WONDERING AND WE'RE STILL MEETING 120-DAY RESERVE WITH WE ARE NOT WE ARE NOT, WE ARE NOT.

WE HAVEN'T BUSTED DOWN PAST 90.

NO, NO, THIS BUDGET HAS IT AT 105 DAYS.

OKAY. YEAH. IT'S DROPPED 15 DAYS.

YEAH. AND IT'S GOING TO FLUCTUATE A LITTLE BIT.

WE'LL KNOW MORE WHEN WE CLOSE OUT THE YEAR, BUT I SUSPECT IT'S GOING TO SETTLE OUT AROUND RIGHT AROUND 102, 103 DAYS.

AND THEN WE'LL BUILD BACK UP.

AND PART OF THAT DECREASE OF FIVE DAYS OF THE DECREASE IS RELATED TO THE SALES TAX COMING IN LOW THIS YEAR.

SO WHAT WE'RE LOOKING AT THE FINES.

[00:35:03]

OKAY. SO FINES THAT DON COLLECTS FROM HOT TAX AS WELL I MEAN I GUESS THAT'S FINE.

BUT OTHER HOT TAX.

YES. WHERE DID LIKE THAT LAWSUIT? THAT MONEY THAT CAME IN.

MOST OF IT WAS HOT, SO MOST OF IT WENT BACK INTO HOT.

AND THEN THERE WAS A SMALL AMOUNT OF PENALTY.

I THINK WE GET 7% PENALTY AND 7% INTEREST.

YOU CAN KEEP THE PENALTY, BUT NOT THE INTEREST.

THE INTEREST AND THE PRINCIPAL GO TO GO TOWARD HOT PURPOSES.

SO THEY GO BACK INTO THE HOT FUNDS.

SO I WANT TO GO BACK TO THE SUBJECT THAT I HAD ON THE WORKSHOP, AND THAT WILL BE ON THE WORKSHOP AGAIN, THIS UPCOMING MEETING, HAVING TO DO WITH OUR ORDINANCES WHERE WE SHOULD BE LIKE DOING FINES ON A DAILY BASIS.

NOT THAT I WOULD EVER WANT A BIG PORTION OF OUR BUDGET TO COME FROM FINES, BUT WITH THESE DELINQUENT PROPERTIES THAT WE HAVE WHERE, YOU KNOW, IF OUR ORDINANCE IS READ BETTER THAT COULD BE A BIGGER SOURCE OF INCOME AND PERHAPS HELP SOLVE THE PROBLEM.

WELL, LET'S TALK ABOUT THAT FOR A SECOND.

FINDS GUIDE ME ON THIS FINDS I'VE ALWAYS HAD THE UNDERSTANDING WE GET ABOUT 50% OF THOSE FINES.

YEAH. AND YOU'RE LIMITED BY THE STATE AS TO THE AMOUNT OF FINES IN TERMS OF THE ACTUAL FINE AMOUNT.

AGAIN, IF OUR INCREASES WERE OTHER THINGS AND WE WERE GOING TO DEDICATE THESE FINES FOR CAPITAL PURPOSES OR THINGS, I THINK THAT'S A GOOD PLAY.

BUT BEING THAT MOST OF YOUR INCREASES ARE PERSONNEL ISSUES, FINES ARE NOT A STABLE WAY TO DO A CERTAIN PERCENTAGE OF IT IS.

BUT THE WHOLE PURPOSE OF FINES IS TO IS TO CHANGE BEHAVIORAL PATTERNS.

AND IF YOU'RE NO.

BUT YOU'RE EFFECTIVE IN YOUR FINING YOUR BEHAVIOR PATTERNS CHANGE BEHAVIOR.

BRIAN, BEFORE WE LEAVE THIS SUBJECT, I'M GOING TO INSERT THIS.

WE'RE DOWN TO 105 IN THIS BUDGET, WE'RE PROPOSING MOVING FROM 120 TO 105 IN OUR RESERVE FUND.

AND THE CHARTER DICTATES 90 DAYS.

IS THAT CORRECT? THAT IS CORRECT.

BRIAN, I'D LIKE FOR YOU TO EDUCATE COUNCIL HERE IN YOUR MIND, THE IMPORTANCE OF IN YOUR MIND OF HAVING 120 COMPARED TO 90.

WELL, IT'S I MEAN, IT'S APPARENT THIS YEAR BECAUSE YOU, YOU KNOW, IF IF WE WERE, IF WE JUST DID OUR BUDGET VERY LEAN ON 90 DAYS AND WE HAD A DOWNTURN IN SALES TAX DAYS, WE WOULD BE FORCED TO MAKE MORE DRACONIAN CUTS IN YOUR BUDGET AND PROBABLY SERVICES IN ORDER TO MAINTAIN THAT CHARTER MANDATED 90 DAYS, BECAUSE WE'RE AT 120 DAYS.

AND YOU HAVE THAT FLEXIBILITY.

AND WITH, YOU KNOW, THAT'S WHY YOU DON'T SEE EVERYBODY GOING TO COMPLETE PANIC AROUND HERE ANYMORE WHEN WE HAVE A TROPICAL STORM OR HURRICANE LIKE BERYL, OR WE SEE A LITTLE BIT OF DIP. YOU'VE HEARD ME SAY OVERALL THAT, YOU KNOW, WHILE 5% IS $1 MILLION WE'RE NOT IN PANIC MODE AROUND HERE BECAUSE OF THAT REASON.

AND WE'RE STILL VERY HEALTHY AT 105 DAYS.

SO, YOU KNOW, YOU KNOW, WE GET WE YOU START SEEING A TWO OR MULTIYEAR TREND.

YEAH. YOU'RE GOING TO GET CONCERNED ABOUT THAT.

BUT I DON'T THINK WE'RE THERE YET.

BUT THAT'S THE THAT'S THE REAL PURPOSE.

THE DIFFERENCE BETWEEN 90 AND 120 DAYS, IF WE GET HIT BY A CATEGORY FIVE, THAT REALLY I DON'T WANT TO BE FLIP ABOUT IT, BUT OH YEAH, AIN'T GONNA MAKE A HILL OF BEANS.

YOU GOING TO TRY TO WORK TOWARDS THAT 120? ABSOLUTELY. OH, NO.

ABSOLUTELY. IT'LL BE OUR GOAL TO DO THAT.

AND, YOU KNOW, I MEAN, KEEP IN MIND WHAT WE, WHAT WE PRESENT TO YOU IN YOUR BUDGET IS A VERY CONSERVATIVE NUMBER.

IT DOESN'T TAKE INTO ACCOUNT A LITTLE BIT.

IT DOES. BUT WE'RE VERY CONSERVATIVE IN OUR VACANCY RATES.

AND ANY TYPE, YOU KNOW, THERE'S A WHOLE LOT OF THINGS THAT ARE GOING TO CHANGE.

AND I WILL CAUTION YOU THAT, YOU KNOW, WE TEND TO OR AT LEAST I DO TEND TO LOOK BEYOND THE BUDGET WE'RE WORKING ON QUITE A BIT.

AND IN 26 YOU ARE GOING TO BE FACED WITH VERY HIGH PUBLIC SAFETY COST CHANGES AGAIN.

THAT'S WHEN WE'RE UP AND WE RESURVEY.

AND I CAN TELL YOU BY LOOKING AT WHAT THE OTHER CITIES AROUND US ARE DOING, YOU YOU'RE GOING TO BLOW YOUR 3.5% OUT OF THE WATER.

THERE'S NO WAY, THERE'S NO WAY.

AND ALSO, WHILE WE ARE CHEWING UP ON THE FIRE PENSION AT A 1.5%, WE'RE HAPPY TO DO THAT.

STILL A VERY RICH PLAN.

AND THEY ARE STILL BANKING ON A 7.5% RETURN.

AND AS WE'VE ALL SEEN, THEY'RE BANKING ON FUTURE INTEREST RATE REDUCTIONS THERE.

THEY HAVE DONE A GOOD JOB OF DIVERSIFYING THEIR PORTFOLIO A LITTLE BIT MORE.

AND I THINK THEY'RE GOING TO BE OKAY.

BUT THEY ARE STILL VERY AGGRESSIVE AT 7.5%.

[00:40:03]

BUT EVERYBODY RECOGNIZES THAT 7.5% IS AN OUTLIER.

WE MET WITH TRAVIS AND GREG THE OTHER DAY ON THAT, AND THEY RECOGNIZED IT AS WELL.

AND WE'RE GOING TO START TO WORK THAT DOWN.

BUT WORKING IT DOWN COST YOU MONEY.

BRIAN, YOU MENTIONED THAT WE'RE DOWN TO 105 IN THIS PROJECTED BUDGET ON THE RESERVE FUND, AND YOU WOULD BUILD THAT BACK UP.

HOW'S THAT? IT'LL BE, YOU KNOW, I MEAN, AGAIN, CRAIG, IT GETS BUILT UP IN SEVERAL DIFFERENT WAYS.

YOU HOLD VACANCIES AND YOU DO THINGS LIKE THAT.

RIGHT NOW, IT'S GOING TO BE IT'S DIFFICULT TO PROJECT HOW WE'RE GOING TO DO THAT BECAUSE WE'RE STILL SPENDING WE'RE OUT FLOWING QUITE A BIT OF CASH, RUNNING SEVEN DAYS A WEEK ON BARREL. BUT WE'RE GOING TO GET THERE'S GOING TO BE FEMA RECOVERIES AND OTHER THINGS.

I FEEL VERY COMFORTABLE THAT WE'RE GOING TO GET BACK UP REALLY CLOSE TO 120 DAYS NEXT YEAR.

AND, YOU KNOW, BARRING SOME OTHER HUGE DROP IN SALES TAX OR SOME OTHER EVENT OR DISASTER THAT AFFECTS US, BUT I DON'T I'M NOT I'M NOT READY TO SOUND THE ALARM ON THAT YET.

I THINK WE'RE FINE. SOUNDS GOOD.

AND REALLY, IF SALES TAX IS A CONSERVATIVE ESTIMATE AND IF LONG TERM PARKING IS A CONSERVATIVE ESTIMATE, ANY INCREASE WE HAVE IN THOSE REVENUES WOULD AUTOMATICALLY GO TO BRING TO BUILD THAT BACK UP.

IT'S NOT BUDGETED TO SPEND, SO IT'S JUST GOING TO DROP TO THAT FUND BALANCE.

YEAH I'D SAY WE END ABOUT 125 BY THE END OF THE YEAR.

WELL, I WOULD HOPE YOU KNOW WHAT.

I HOPE YOU'RE RIGHT.

I HOPE YOU BECAUSE YOU'RE GOING TO NEED THAT NEXT YEAR.

JUST FOR CONTEXT, THE PARK BOARD ALSO KEEPS 90-DAY RESERVE, CORRECT? CORRECT. THEY TRY TO DO 100.

THEY'RE LIKE US. THEY TRY TO DO 120, BUT 90 IS THE MINIMUM.

WELL, I THOUGHT, EXCUSE ME FOR INTERRUPTING.

I THOUGHT THAT PARK BOARD WAS 120 IN THEIR POLICY.

IT'S 90 BOB? YEAH, AND LIKE BRIAN SAID, THEY TRY TO DO TRY TO KEEP MORE THAN THAT.

OKAY. THANK YOU.

SO, ON PAGE TWO YOU'LL SEE THE EXPENDITURE BREAKDOWN.

WE REVIEWED THIS A LITTLE BIT AT THE LAST MEETING, BUT WITH PUBLIC SAFETY COSTS MAKING UP 61% OF THE BUDGET.

AND THEN ON THE GENERAL FUND, AND YOU'LL SEE THE OTHER DEPARTMENTS AND HOW THAT COMES IN, THAT BIGGER LIGHT BLUE PIECE OF THE PIE IS THE TRANSFER TO INFRASTRUCTURE FUND. AND AS WE'VE DISCUSSED, THAT IS THAT 8% IS INCREDIBLY HELPFUL FOR THE CITY AS WE'RE PAVING STREETS AND DOING OTHER INFRASTRUCTURE PROJECTS.

HOWEVER, COUNCIL HAS TO KEEP IN MIND THAT EVERY TIME WE INCREASE ANY REVENUE SOURCES IN THE GENERAL FUND, WE INCREASE THE AMOUNT THIS 8%, BECAUSE THE 8% IS BASED ON THE TOTAL REVENUE IN THE GENERAL FUND.

AND SO, AS THE REVENUE INCREASES, THAT PIECE OF THE PIE WILL CONTINUE.

AND JUST SIMPLE AGGIE MATH FOR YOU GUYS.

PROPERTY TAX IS 50% OF YOUR REVENUE.

SALES TAXES ROUGHLY 25% IF YOU JUST LOOK AT PUBLIC SAFETY COSTS, THAT'S 100% OF YOUR SALES TAX AND HALF YOUR SALES TAX, PRETTY MUCH FUDGING JUST A LITTLE BIT.

SO JUST KEEP IN MIND THAT THAT'S REALLY WHERE IT'S DRIVING MOST OF YOUR EXPENSES HERE, AND RIGHTLY SO.

LOW NUMBER COMPARED TO OTHER CITIES.

I DON'T KNOW ABOUT THAT, BUT IT'S YEAH, IT'S I TELL YOU HOW IT'S DRIVING IT HERE.

I DON'T THINK THAT'S A LOW NUMBER COMPARED TO OTHER CITIES, BECAUSE OTHER CITIES DON'T HAVE FULL TIME FIRE DEPARTMENTS.

YOU EVER BROKE DOWN HOW MUCH HOT TAX IS SPENT ON PUBLIC SAFETY? YEAH. SO WE CAN LOOK AT THAT.

WE'RE GOING TO GET TO THE HOT TAX DOWN THE ROAD.

IF YOU TURN TO PAGE I'M SORRY.

YEAH. SO ON THAT PUBLIC SAFETY WHICH INVOLVES BOTH THE MARSHAL AND GPD CORRECT.

IS THERE ANY WAY WE CAN GET A COMPLETE ITEMIZED BREAKDOWN? ABSOLUTELY. WE'RE GOING TO GET TO THAT IN JUST A MOMENT.

IT'S IN HERE, IT'S IN HERE.

IT'S IN THERE. YOU HAVE THE WHOLE BOOK IN FRONT OF YOU.

LOOK AT YOU. SO IF YOU TURN TO PAGE EIGHT AND NINE OF THE GENERAL FUND SUMMARY, THIS IS WHERE YOU'RE GOING TO SEE HOW WE COMPARE THOSE REVENUES TO EXPENDITURES.

YOUR REVENUES START ON THE TOP LEFT-HAND SIDE OF PAGE EIGHT.

AND YOU'LL SEE THAT THE TOTAL REVENUE PROJECTED RIGHT NOW IS THE $82.7 MILLION.

YOU'LL SEE ABOVE THAT THE VERY FIRST LINE IS YOUR FUND BALANCE GOING INTO FISCAL YEAR 25.

SO, ON SEPTEMBER 30TH, WE EXPECT TO END THIS CURRENT YEAR WITH THE $24.3 MILLION THAT'S GOING TO CARRY FORWARD.

AND THEN YOU'LL SEE ALL OF YOUR DEPARTMENTS IN THE GENERAL FUND BY THE TOTAL OF THE DEPARTMENT LISTED HERE.

SO, YOU SEE THE PUBLIC SAFETY TOTAL IS THE 5.8 MILLION, BUT POLICE IS 30.1 MILLION, ALMOST 2 MILLION.

FIRE IS THE 17.3 AND SO ON.

IF YOU GO TO THE BOTTOM OF THE PAGE ON THE RIGHT, PAGE NINE, YOU'RE GOING TO SEE THE CALCULATIONS FOR THE YEAR END FUND BALANCE.

SO RIGHT IN THE MIDDLE OF THE PAGE YOU SEE TOTAL EXPENDITURES AT 82.9 MILLION.

YOU'LL SEE THAT $140,000 DIFFERENCE THAT WE'RE GOING TO ADJUST ON BASED ON HOW THE PROPERTY TAX CONVERSATION GOES IF WE NEED TO.

AND THEN THE ENDING FUND BALANCE IS ABOUT THE FOURTH ONE UP.

IT'S THE 23.914 IS WHERE WE'RE PROJECTING TO END THE FISCAL YEAR.

[00:45:04]

AND SO THE WE'RE ABOUT 3.3 MILLION SHORT TO BE AT 120 DAYS, WHICH TAKES US TO ABOUT 105 DAYS.

AND SO THE TOTAL APPROPRIATION, INCLUDING THAT 250,000 FOR THE COMPREHENSIVE PLAN THAT'S BEING CARRIED FORWARD IS 83.1 MILLION.

SO THIS IS A REALLY GOOD SUMMARY HERE TO REALLY REVIEW THE GENERAL FUND AND UNDERSTAND.

BUT WHAT I'D LIKE TO DO IS GIVE YOU A FOR THOSE OF YOU WHO ARE LOOKING AT THE BUDGET FOR THE FIRST TIME TO UNDERSTAND HOW IT WORKS, IF YOU TURN THE PAGE TO TEN, PAGE TEN AND 11, YOU'LL SEE THE SUMMARIES, JUST VERY HIGH LEVEL SUMMARY ON PAGE TEN.

BUT ON PAGE 11 WE START LIKE THE AREA SUMMARIES AND SO ON.

THIS FIRST PAGE TO YOUR QUESTION, COUNCILMAN RAWLINS, YOU SEE THE BREAKDOWN OF THE DEPARTMENTS IN HIGH LEVEL.

BUT WHEN YOU TURN THE PAGE YOU'RE GOING TO GET THE MISSION STATEMENT STARTING WITH THE POLICE DEPARTMENT.

AND EVERY SINGLE DEPARTMENT IN THE CITY IS SET UP THIS WAY IN THE BUDGET.

SO I RECOMMEND, IF YOU'RE INTERESTED IN A SPECIFIC DEPARTMENT, GO FIND IT.

IT'S LISTED IN THE TABLE OF CONTENTS IN THE FRONT, AND YOU CAN FIND THE PAGES.

BUT THEY PROVIDE YOU THE MISSION STATEMENT AND THE NARRATIVE OF WHAT THEIR BUDGET DOES.

ON PAGE 13 YOU'LL SEE THERE THE DEPARTMENT'S SPECIFIC CATEGORY EXPENDITURE SUMMARY.

YOU'LL SEE THE BUDGET HIGHLIGHTED CHANGES.

SO YOU UNDERSTAND YEAR OVER YEAR WHAT'S OCCURRED.

AND THEN YOU'LL SEE SOME PERFORMANCE INDICATORS WHEN YOU TURN TO PAGE 14.

THIS IS WHERE YOU SEE THE POSITION BREAKDOWN FOR THE DEPARTMENT AT THE TOP.

SO IN THE CASE OF POLICE YOU'LL SEE THE POSITION BREAKDOWN IS 208.5 POSITIONS.

AND THEN AFTER THAT BEGINS THE LINE-ITEM DETAIL RELATED TO THEIR BUDGET.

SO TOTAL PAYROLL, TOTAL LONGEVITY, THAT SORT OF THING.

AND EVERY SINGLE DEPARTMENT THE BUDGET IS STRUCTURED IN THIS WAY.

SO IF YOU HAVE QUESTIONS ABOUT A SPECIFIC LINE, YOU CAN FEEL FREE TO REACH OUT AND CALL US, AND WE'LL HELP YOU UNDERSTAND WHAT'S GOING OUT AND WHAT'S COMING IN.

BUT THROUGHOUT THE WHOLE BUDGET, WE'RE NOT GOING TO GO OVER EVERY DEPARTMENT AND EVERY LINE AS YOU'RE LOOKING THROUGH IT.

THIS IS THE TOOL THAT I WOULD ENCOURAGE YOU TO USE TO FIGURE OUT WHAT EACH DEPARTMENT IS.

SO WHAT I GUESS I WAS ALLUDING TO.

SO LIKE ON YOUR LINE ITEM TOURISM RELATED ACTIVITIES? YES. AT WHAT POINT CAN THERE BE A DESCRIPTION OR A RELATION BETWEEN HOT TAX AND WHAT WE PROVIDE TO SUPPORT TOURISM THROUGH GPD? SO, WE HAVE VERY SPECIFIC ITEMS, FOR EXAMPLE, MARDI GRAS AND SEAWALL DETAIL, SEAWALL, SEAWALL DETAIL, BIKE RALLY.

THERE ARE VERY SPECIFIC THINGS WHERE WE ESSENTIALLY WHEN A POLICE OFFICER IS ASSIGNED TO A CERTAIN SHIFT THAT SPECIFICALLY TOURISM RELATED, THEN THAT IS ALLOCATED IN SUCH A WAY THAT IT'S BEING REIMBURSED BY HOT FUNDS.

OKAY. SO HOW CAN THAT BROADEN TO TO INCLUDE, YOU KNOW, OUR BIG WEEKENDS THROUGHOUT THE SUMMER.

SO PART OF IT IS TRACKING.

IT'S REALLY GOOD DATA. I THINK ONE OF THE THINGS THAT'S REQUIRED FOR THE HOT TO USE THE HOT FUNDS IS THAT IT DEMONSTRATABLY SUPPORTS TOURISM.

AND SO IN ORDER TO OFFSET COSTS, PUBLIC SAFETY COSTS, FOR EXAMPLE, WE HAVE TO BE ABLE TO DEMONSTRATE WITH DATA THAT THOSE COSTS ARE EQUIVALENT TO WHAT WE'RE.

HOT IS PRECLUDED FROM SUPPLEMENTING GENERAL OPERATIONS OR NORMAL CUSTOMARY CITY OPERATIONS.

SO, DO WE STILL HAVE A COUNTER ON THE CAUSEWAY? YEAH, THERE'S SOME EMBEDDED IN THE CAUSEWAY.

THEY'RE NOT THEY DON'T PICK UP.

THEY DON'T DO A REAL GOOD JOB WITH MOTORCYCLES AND THINGS LIKE THAT.

BUT THEY'RE THERE, I GET THAT.

BUT AS FAR AS LIKE DATA THAT YOU'RE EXPLAINING AND WE HAVE AN INFLUX OVER A GIVEN WEEKEND THAT, YOU KNOW, IS KIND OF AN ANOMALY THAT WE HAVE TO BRING IN EXTRA STAFF THROUGH GPD.

AT WHAT POINT ARE WE ALLOWED, YOU KNOW, WHERE IS THE, YOU KNOW, BROADENED DEFINITION OF WHERE WE CAN GET THAT REIMBURSED? LET ME INTERJECT ON THAT.

I TALKED WITH THE TEXAS HOTEL LODGING ASSOCIATION ON THAT EXACT QUESTION.

THEY HAD MENTIONED LET'S TAKE THE TRAFFIC CONTROL ON 61ST.

THEY SAID, IF YOU CAN RUN AND SHOW YOUR EXPENSES ON A NORMAL OPERATION, WHAT THAT WOULD TAKE.

AND THEN ON BUSY WEEKENDS, 4TH OF JULY, ALL THIS OTHER YOU COULD SHOW THE INCREASE OF PERSONNEL COSTS TO HANDLE THAT.

THEN THAT IS A CASE THAT YOU COULD MAKE FOR POSSIBLY USING HOTEL OCCUPANCY TAX.

YES, SIR. SO, THEN WE CAPTURED THAT.

SO, WE ARE RIGHT NOW BUDGETED.

I SEE THE 250.

YEAH. RIGHT NOW, WHAT'S BUDGETED IS WHAT WE'VE HISTORICALLY BEEN DOING.

[00:50:01]

NONE OF THIS WOULD BE POSSIBLE WITHOUT THE BUDGET TEAM.

THEY'RE FANTASTIC.

DEBBIE AND HER WHOLE GROUP HAS BEEN INCREDIBLY HELPFUL, BUT WE HAVE AN EMPLOYEE WHO IS WORKING WITH THE POLICE DEPARTMENT RIGHT NOW TO START CALLING THAT DATA AND LOOKING AT CALLS AND RESPONSE AND ADDRESSES.

CSILLA HAS DONE IS EMBEDDED A FOR THE FIRST TIME, A BUDGET ANALYST IN THE POLICE DEPARTMENT.

IN ANTICIPATION OF DOING THIS, WHICH YOU'RE EXACTLY.

I'LL JUST SEE WE'RE MISSING A LOT THERE, JUST BECAUSE OF FINDING DATA.

BUT NOT ONLY THERE.

LIKE, THERE COULD BE POLICE, BEACH POLICE THAT ARE PAID FOR OUT OF HOT TAX, BECAUSE, I MEAN, I THINK MORE OR LESS.

THAT'S THE THIRD DEFINING BEACH PATROL BY I GUESS.

BUT NO, BUT NO, WE'RE TALKING ABOUT LIKE THE I UNDERSTAND WHAT YOU'RE SAYING.

EVERY POLICE OFFICER IN THE CITY HOW TO GO TO A SUNNY BEACH BECAUSE IT WAS SO OUT OF CONTROL.

BUT WE HAVE SO MANY BEACH POLICE CALLS BECAUSE BEACH PATROL, EVEN THOUGH THEY HAVE SIX PEACE OFFICERS, ALWAYS CALLS PD DOWN THERE AND THAT COULD 100%.

BEACH PATROL DOES NOT HANDLE LAW ENFORCEMENT STUFF.

THAT COULD BE PAID FOR.

AND I WOULD ALSO I WOULD ARGUE, AND I CONTINUE TO ARGUE THAT THE SATURATION OF SHORT TERM RENTALS, ESPECIALLY ON THE WEST END, WOULD DICTATE THAT. AND THAT IS A PRIMARY IF IT'S 50% OF YOUR HOT TAX COLLECTION.

OBVIOUSLY, THESE ARE SHORT TERM RENTALS AND VISITORS THERE THAT, YOU KNOW, IT'S HOW WE END UP DRAWING THE DISTRICTS.

AND I'VE TALKED TO THE CHIEF ABOUT DOING THIS.

WELL, THAT GETS BACK TO THE DATA OF CALCULATING AND KNOWING WHAT THE NUISANCE CALLS ARE AND UNDERSTANDING WHERE THESE CALLS IT DOES.

AND IT ALSO COMES DOWN TO THE FACT OF HOW WE DRAW OUR DISTRICTS AND HOW THEY DO IT.

BUT KEEP IN MIND THAT EVEN GIVEN THAT ON A BUSY WEEKEND, IT'S HARD TO IT'S HARD TO SEE.

IT'S HARD TO KEEP A COP IN A DISTRICT.

SO. BUT TO HEAR WHAT THEIR CALLS, YOU KNOW, DEPENDING ON THE LEVEL OF THE CALL.

YEAH. OF COURSE, BUT TO YOUR POINT, I MEAN, IF YOU LOOK AT JUST MY DISTRICT OR ACTUALLY YOUR DISTRICT, BUT MY DISTRICT HAS 2400 AND YOUR DISTRICT AND YOURS AND YOURS AND YOURS.

ALEX DIDN'T EVEN HAVE A BUILDING.

I HAVE 2400 SHORT TERM RENTALS IN MY DISTRICT, AND I HAVE A LOT OF ISSUES, BUT I'M SAYING THAT PORTION OF THAT POLICING SHOULD BE PAID FOR BY HOT TAX.

YEAH, THAT THE OTHER DISCUSSION ON THIS HOT TAX IS WHERE WHO DO YOU TAKE IT FROM? I WAS GOING TO SAY THAT THAT'S WE'LL GET THERE.

I THINK IT'S VERY EASY FOR US TO JUSTIFY THE USE OF HOT TAX.

THE DIFFICULTY ALWAYS BECOMES BECAUSE AND I'M GOING TO YOU'RE GOING TO HEAR ME SAY THIS UNTIL I'M NOT HERE ANYMORE.

YOUR TRICKLE DOWN MONEY IS GOING AWAY.

SO WE NEED TO HAVE A PLAN FOR WE'RE GOING TO TALK ABOUT THAT WHEN YOU GET TO THE SPECIAL FUNDS.

BUT LAST THING WITH THIS, WITH THE FACT THAT WE ARE ABLE TO MONITOR OUR SHORT TERM RENTALS SO WELL WITH, YOU KNOW, THE ASSIGNMENT OF COLLECTIONS AND.

IS THERE ANY OVERLAP TO WHERE THERE IS A, I FORGET THE NAME OF THE, OF THE DIGITAL MAPS.

IS THERE ANY OVERLAP THAT CAN COLLECT THAT DATA SIMPLY BY OVERLAYING IT INTO ANOTHER PROGRAM.

WE HAVE TO WHERE IT ACTUALLY SHOWS US LIKE IN OTHER WORDS, IT SHOWS 2023.

THERE WAS, YOU KNOW, 70% 2024, IT WAS 57%.

IN OTHER WORDS, JUST, YOU KNOW, HAVING A MEDIAN NIGHT AS FAR AS THE COST AND THE PERCENTAGE THAT IT'S FULL FOR US TO BE ABLE TO COLLECT DATA TO ACTUALLY SHOW AN INCREASE, I'M SURE OF THAT DATA EXIST IN PROBABLY 50 DIFFERENT PLACES RIGHT NOW, WORKING TO CONSOLIDATE AND TO CONSOLIDATE.

I THINK THAT THAT WOULD BE A VERY DATA DRIVEN REASON.

YEAH. AND IT'S, YOU KNOW, I MEAN, I'M NOT SAYING THIS IN A BAD WAY, BUT BECAUSE WE'RE SEPARATE ENTITIES, IT'S HARDER TO DO THOSE THINGS.

SO BUT WE CAN FIGURE IT OUT.

I, I'M GOING TO BEG TO DIFFER WITH YOU.

I THINK WE COULD SIT DOWN.

AND I THINK, BOB, YOU PROBABLY AGREE WITH ME.

I THINK WE COULD SIT DOWN WITH THE PARK BOARD, DISCUSS THIS ISSUE BECAUSE IT AFFECTS THEM, TOO.

GOD, I'VE SEEN, YOU KNOW, PICTURES OF, LIKE, HORRIBLE THINGS THAT SHORT TERM RENTALS THAT'S HURTING THE INDUSTRY.

SO THIS AFFECTS THEM AS WELL.

[00:55:01]

WELL, I DON'T KNOW.

I DIDN'T SAY THEY WOULDN'T AGREE TO IT.

I JUST SAID THAT YOU AND AS CSILLA AGREES ON THIS, WE'LL AGREE TO ANYTHING YOU GUYS TELL US TO.

BUT YOU'RE THE MONEY'S NOT JUST SITTING IN A POT.

WE'RE WANTING TO TAKE IT.

THE MONEY IS ALREADY IS AND WE HAVE A BUDGET REQUEST FROM THE PARK BOARD THAT'S ASKING FOR 100% OF EVERYTHING WE COLLECT, PLUS SOME MONEY YOU'VE GOT IN YOUR SAVINGS ACCOUNT.

SO YOU'RE GOING TO HAVE TO TAKE IT FROM SOMEWHERE.

YOU'RE GOING TO HAVE TO TAKE IT FROM MARCH AND HISTORIC PRESERVATION.

YOU'RE GOING TO HAVE TO TAKE IT FROM CULTURAL ARTS.

YOU MAY HAVE TO TAKE IT FROM THE AVAILABILITY OF FUNDS THAT THE PARK BOARD HAS, WHICH ARE VERY LIMITED TO THE CITY.

IT REQUIRES CHARTER CHANGES IF WE WANTED TO MOVE IN THAT DIRECTION.

SO, IT'S A SUBJECT THAT I THINK BO'S MENTIONING.

WELL, I WOULD SAY THIS, GUYS, THIS COMES UP EVERY BUDGET AND WE ALWAYS TALK ABOUT IT.

BUT THEN AS SOON AS BUDGET'S OVER, WE MOVE ON TO 50 OTHER DIFFERENT THINGS, FROM FERAL CATS TO SOMETHING ELSE.

IT NEVER STOPPED. THANK YOU FOR THE CHALLENGE.

I'M NOT GOING TO LET THIS THANK YOU.

AND WE HAVE NEVER STOPPED TALKING ABOUT THIS.

I KNOW, BUT WE BUT I BUT WE TALK ABOUT IT.

BUT I THINK YOU NEED TO HAVE THIS DISCUSSION WITH YOUR PARTNER BOARDS ABOUT IT AND COME UP WITH A LONG TERM PLAN.

IT DOESN'T JUST INVOLVE PUBLIC SAFETY.

IT INVOLVES SANITATION AND STREETS, TRAFFIC CRASH.

AND BACK TO BRIAN'S POINT.

THE TRICKLE DOWN WILL DISAPPEAR IN TEN YEARS.

AND SO AT THAT POINT, THERE'S EVEN LESS FLEXIBILITY ON THE PART OF THE CITY.

SO THE SOLUTION MAY NOT BE A SHORT TERM, NEXT SIX MONTH SOLUTION.

BUT IT IS REALLY VERY IMPORTANT THAT THE COUNCIL STRATEGICALLY FIGURE OUT HOW THAT WHAT THAT IMPACT OF THAT'S GOING TO BE TEN YEARS FROM NOW AND THAT TRICKLE DOWN DOESN'T EXIST.

IT'S NOT EVEN TEN YEARS.

IT'S NEXT YEAR.

NEXT YEAR WE'RE GOING TO TALK ABOUT THE SPECIAL FUNDS.

AND IT'S COMING UP THE NOT THE TRICKLE DOWN MAYOR.

YEAH. IT'S 34 I THINK.

RIGHT. 34 34.

NO, NO I UNDERSTAND THAT'S WHEN THAT EXPIRES.

BUT WE'LL GET TO THAT WHEN WE ALL RIGHT.

SO WHAT I'M TALKING ABOUT IS WHILE WE'RE IN THE PROCESS OF THIS BUDGET TIME, THAT WE MAYBE HAVE A SPECIAL MEETING AND SIT DOWN AND TALK ABOUT, YOU KNOW, I MEAN, BECAUSE WE'RE NOT TALKING ABOUT TAKING MONEY AWAY FROM ADVERTISING, BUT WHEN THE POLICE PATROL HAS A CALL MPD, YOU KNOW, THAT'S DEFINITELY A TOURIST RELATED.

AND I DON'T THINK THEY WILL FIGHT US TO THE NOW I THINK EVERYBODY'S READY TO WORK TOGETHER.

BUT IF WE DON'T ALL GET IN A [INAUDIBLE] JUST LIKE THE MEETING WE HAD WITH PELICAN ISLAND, THESE ARE PELICAN BRIDGE.

I MEAN THINGS ARE FINALLY MOVING TOGETHER BECAUSE WE GOT ALL PLAYERS IN ONE ROOM.

YOU KNOW, WE ALWAYS SAY, OH, IT'S NOT GOING TO HAPPEN.

BUT TO ME, YOU ALWAYS ASK, YEAH, THEY'RE GOING TO SAY YES OR NO, BUT I THINK THEY SEE THE REALITY BECAUSE I'M GOING TO TALK ABOUT 305.

WE KNOW WE HAVE AN ISSUE WITH TXDOT.

THEY KNOW THEY DON'T PICK UP TRASH.

YOU HAVE 2400 RENTALS DRIVING OUT THERE AND THEY SEE NOTHING BUT TRASH.

THEY MAY NOT COME BACK NEXT YEAR.

AND RIGHT NOW THE PARKS DEPARTMENT DOES THAT OUT OF THE GENERAL FUND.

AND THAT'S NOT RIGHT.

TECHNICALLY, TXDOT SHOULD BE PAYING FOR IT, BUT THAT'S LIKE PULLING TEETH.

I THINK WHAT IT DOES, IT DOES.

AND I THINK WE ALMOST NEED A SPECIAL MEETING TO DISCUSS THIS, BUT WE NEED TO HAVE AN UNDERSTANDING OF THE HOT TAX.

SO IT'S PART OF THIS PRESENTATION AT THE END.

SO THE OKAY WE'RE GOING TO TALK ABOUT THAT AS WELL.

AND CRAIG REMEMBER WE DID NOT TOO LONG AGO SEND OUT AT LEAST THREE DIFFERENT DOCUMENTS EXPLAINING HOT TAX.

AND IT WENT TO AND THAT WAS A GREAT OVERVIEW OF HOW THIS HOT TAX.

WHAT I'VE INCLUDED.

AND SO, I THINK IT WILL ALLOW EVERYONE, EVERY ONE OF US TO HEAR IT AS WELL AS JUST SEE IT.

AND WE CAN ASK QUESTIONS BASED ON THAT INFORMATION.

BUT IF YOU'VE REVIEWED THAT PRESENTATION, THAT'S SORT OF WHERE MINE WILL START.

SOUNDS GREAT. SO I'M GOING TO MOVE ON FROM THE GENERAL FUND RIGHT NOW, BECAUSE I'VE GIVEN YOU A FRAMEWORK ON HOW TO REVIEW IT, AND WE DON'T HAVE ENOUGH TIME FOR ALL THE DETAILS, BUT I'M HAPPY TO ANSWER QUESTIONS OVER THE NEXT FOUR WEEKS.

SO MOVING ON TO AFTER THE SPECIAL REVENUE TAB, SF1, YOU'RE GOING TO SEE ALL OF YOUR SPECIAL REVENUE FUNDS THAT THE CITY BUDGETS.

THERE'S 25 OF THEM.

AND BASED ON THE GRAPH YOU SEE IN THE POWERPOINT PRESENTATION, YOU'LL SEE THE MAJORITY OF THIS IS HOT OKAY.

[01:00:05]

BUT THE OTHER BIG ITEMS ARE YOUR LIBRARY, WHICH IS WHERE THAT $6 MILLION OF PROPERTY TAX LEAVES TO GO TO THE LIBRARY, YOUR CONVENTION CENTER SURPLUS, WHICH IS THE NEXT ONE.

IT'S RIGHT AROUND $15 MILLION IN TOTAL.

AND THE INFRASTRUCTURE AND DEBT SERVICE FUND, WHICH IS ABOUT $10 MILLION.

SO THOSE ARE THE BIG ONES.

AND WE'RE GOING TO TOUCH ON THOSE A LITTLE.

IF YOU LOOK AT PAGES ONE AND TWO OF THE SPECIAL REVENUE AREA, YOU'RE GOING TO SEE THE BEGINNING FUND BALANCES JUST LIKE IN THE PREVIOUS PRESENTATION.

BUT HERE YOU SEE ALL 25 FUNDS, FOLLOWED BY THE REVENUE WE'RE EXPECTING THIS YEAR, AND THEN THE EXPENDITURES AND THE ENDING FUND BALANCE.

ONE OF THE THINGS THAT'S IMPORTANT TO NOTE IS IN THE SPECIAL REVENUE FUND, WE BUDGET TO SPEND ALL OF THE FUND BALANCE AND ALL OF THE REVENUE TO MAKE IT AVAILABLE TO COUNCIL AS NEEDED. WELL, THAT THAT'S MY CONCERN, OKAY.

BECAUSE LET'S TAKE THE SEAWALL PARKING FUND THAT'S ON FS6.

OKAY. WE'RE WE RENT GUIDE ME ON THIS.

I MAY NOT BE, BUT WE RAN A DEFICIT.

WE MADE UP FOR OUR DEFICIT BY USING THE FUND BALANCE.

THAT IS CORRECT. OUR FUND BALANCE NOW IS ZERO AT THE END OF THIS COMING FISCAL YEAR.

WELL, SO ON A LOT OF THESE, YOU'LL SEE THAT WE HAVE A FUND BALANCE OF ZERO AT THE END OF THE FISCAL YEAR.

AND WE DO THAT.

FOR EXAMPLE, IN THIS SPECIFIC IF WE LOOK AT SF6 YOU'LL SEE CAPITAL RESERVE WHICH IS THE 544125.

AND WE HAVE $1.3 MILLION BUDGETED IN THERE.

IT IS NOT BECAUSE THE BUDGET OFFICE HAS ANY SPECIFIC ITEMS RELATED TO THAT THAT WE'RE PLANNING ON SPENDING.

IT'S JUST WE CREATE THIS RESERVE FUND SO THAT WE DON'T HAVE TO DO A BUDGET AMENDMENT.

IF COUNCIL COME BACK, COMES BACK WITH SOMETHING THEY NEED TO ALLOCATE OUT OF THE SPECIAL REVENUE WE BUDGET TO HAVE A ZERO FUND BALANCE.

THAT WAY ALL OF IT'S AVAILABLE.

BUT OFTENTIMES THAT'S WHY THE CARRY FORWARD IS SO HIGH.

SO YOU'LL SEE THAT ON PAGE SF ONE THAT BEGINNING FUND BALANCE IS $51 MILLION.

AND THAT'S BECAUSE MOST OF IT WAS NOT SPENT EVEN THOUGH IT WAS AVAILABLE FOR SPENDING THIS YEAR.

IF YOU LOOK AT LAST YEAR'S BUDGET IT WAS ZERO THEN TWO.

YES. WELL, I UNDERSTAND, BUT IT SEEMS LIKE THAT SEAWALL PARKING RUNS A DEFICIT.

IS THAT RIGHT? SO WE'RE IN A NEW PROCESS.

YEAH, I MEAN IT, FIRST OF ALL, WE'RE SPENDING A LOT OF MONEY UP THERE.

THE PARK BOARD CONTRACT IS, YOU KNOW, QUITE A BIT OF MONEY, BUT WE'VE ALSO BEEN PUTTING IN THE LIGHTS AND THINGS LIKE THAT.

AND THAT'S WHAT THE INTENTION OF THAT FUND IS.

SO WE'RE USING IT FOR THOSE PURPOSES.

CORRECT. BUT, BUT AND WE'RE DOING THE PEDESTRIAN CROSSINGS THAT WE'RE DOING THIS YEAR.

NOW WHAT I HEAR YOU SAYING, CSILLA, IS THAT THIS 1.3 THEN IS REALLY OUR FUND BALANCE.

YES, AVAILABLE FOR SPENDING IN THIS CASE, BECAUSE WE DON'T NEED A 120 DAY RESERVE IN THIS FUND.

RIGHT? CORRECT.

OKAY. VERY GOOD.

BUT JUST BEFORE WE LEAVE THIS, DOES THAT PARKING RUN A DEFICIT? IT'S RUNNING A DEFICIT BECAUSE OF THE AMENITIES WE'RE PUTTING OUT THERE.

NO, IT'S RUNNING A DEFICIT RIGHT NOW BECAUSE WE'RE INSTALLING NEW AMENITIES AND THERE'S MAINTENANCE AND ASSOCIATED COSTS.

BUT DAY TO DAY REVENUE VERSUS OPERATIONS, NO, IT'S NOT RUNNING A DEFICIT.

THAT'S HOW YOU'RE BUILDING A FUND BALANCE.

OKAY, OKAY.

AND THERE IS A CHANGE IN THE WAY WE'RE GOING TO BE ENFORCING.

YES, CORRECT. ON THE SEAWALL AS WELL.

SO, WITH THE READERS THAT THE FIRE MARSHALS, THE CITY MARSHAL'S OFFICE IS USING IN THE MAIL TICKETS, YES, WE MAY SEE AN UPTICK IN THE REVENUE IN THIS FUND.

WE DON'T KNOW YET, BUT WE'RE HOPING WE WILL.

OKAY, SO SF TWO, THE NEXT PAGE IS THE ONE THAT WE DO NEED TO TALK ABOUT FOR A MINUTE.

THE CONVENTION CENTER SURPLUS OR OTHERWISE KNOWN AS A TRICKLE DOWN.

THIS IS THE SOURCE OF HOT FUNDS SF, AND ON PAGE SEVEN THIS IS THE SOURCE OF HOT FUNDS THAT IS GOING TO GO AWAY.

IT'S THE $0.02 AND THE $0.02 THE BRIMER BILL RELATED TO THE SF SEVEN.

SF SEVEN TO MAKE SURE I WASN'T BEING ROBBED.

SO, SF SEVEN OKAY.

THANK YOU. SO, THESE THIS SOURCE OF FUNDING IS GOING TO GO AWAY.

ESSENTIALLY, ONCE THE CONVENTION CENTER IS PAID OFF, THEN THE AUTHORITY BY WHICH WE COLLECT THE MONEY ASSOCIATED WITH IT ALSO GOES AWAY.

IN 2034 AND 2034.

AND SO, AT THAT POINT, THIS SOURCE OF FUNDING, WHICH WE USE TO OFFSET A LOT OF THOSE COSTS THAT WERE RAISED.

SO MARDI GRAS AND ANY SORT OF PUBLIC SAFETY RELATED TO 4TH OF JULY AND ALL OF THESE THINGS, THEY ARE CAPTURED HERE.

YOU'LL SEE WHAT WE'RE BUDGETING TO SPEND IT ON THIS YEAR.

BUT ONE OF THOSE IS ISLAND TRANSIT.

OBVIOUSLY, ALL OF THOSE ROUTES THAT ARE RELATED TO TOURISM, ALL OF THOSE ARE FUNDED HERE.

[01:05:04]

AND IT'S IMPORTANT THAT WE ARE AWARE THAT LONG TERM, WE NEED TO EITHER PLAN TO NOT DO THESE THINGS OR FIND ADDITIONAL FUNDING SOURCES.

MAYOR, YOU WERE TALKING ABOUT THIS.

WELL, I WAS TALKING NUMBER ONE ABOUT IT WILL GO AWAY AND THAT'S A LOSS OF AROUND IN TEN YEARS FROM NOW.

COULD BE A LOSS OF SIX $8 MILLION TO THE CITY.

AND THAT WOULD AFFECT THE BUDGET THEN.

BUT IT GOES BACK TO THAT ZERO FUND BALANCE.

I'M STILL UNCLEAR ON HERE AS WELL.

IF YOU LOOK AT THE VERY LAST LINE ON PAGE OR THE VERY LAST EXPENDITURE LINE ON SF SEVEN, IS THAT SURPLUS RESERVE FOR $6.9 MILLION.

THERE WE ARE BUDGETING THE ABILITY FOR COUNCIL TO UTILIZE THAT FUND BALANCE FOR PROJECTS DURING THE COURSE OF THE YEAR.

OKAY. THAT MONEY CAN BE SPENT, BUT CURRENTLY IT IS NOT ALLOCATED TO ANY SPECIAL PROJECTS AND IT'S JUST AVAILABLE.

FOR EXAMPLE, WHEN THE PARK BOARD DECIDED THEY NO LONGER WANTED TO DO FIREWORKS ON THE 4TH OF JULY.

THAT'S WHERE WE GOT THE MONEY FROM, AND WE HAD IT ALLOCATED IN THAT FUND BALANCE SO WE COULD DO THAT.

THAT GIVES US THAT FLEXIBILITY.

NOW KEEP IN MIND STAFF JUST CAN'T GO SPEND THAT MONEY.

IT HAS TO HAS TO BE APPROVED BY YOU GUYS.

BUT WE GIVE YOU THAT ULTIMATE FLEXIBILITY.

SO WE GOT 8.9 TO SPEND IN TEN YEARS.

WELL IT IT'S GOING TO FLUCTUATE.

OUR REVENUE IS 5.5 ON THE CONVENTION CENTER.

AND OUR TOTAL EXPENDITURES ARE 14 MILLION, COUNTING THE FUND BALANCE, BUT COUNTING THAT FUND BALANCE.

WELL, I UNDERSTAND, BUT YEAH.

NO, I MEAN, YOU KNOW IT'S HEAVY.

WE'VE HIT THIS FUND.

THERE'S A LOT THIS FUND CARRIES A LOT OF WEIGHT.

SO THAT'S WHY I KEEP IT'S NOT GOING TO HAPPEN WHILE I'M HERE GUYS.

BUT I'M TELLING YOU THE MONEY'S GOING TO RUN OUT.

AND ALSO JUST DON'T LOSE SIGHT OF THE FACT THAT THE CONVENTION CENTER IS STILL THERE.

YOU STILL OWN IT, AND YOU'RE STILL GOING TO HAVE EXPENSES ASSOCIATED WITH THAT.

AND YOU'RE ALSO GOING TO HAVE PROBABLY HAVE TO RENEGOTIATE THE CONTRACT, THE MANAGEMENT CONTRACT ON THAT CONVENTION CENTER.

SO BUT HOW DO I CAN HAPPEN WITH ANYBODY AT THIS TABLE IS SITTING IN YOUR CURRENT POSITIONS, BUT IT'S SOMETHING THAT YOU NEED TO THINK OF.

YOU BUILD THE FUND BALANCE ON THIS.

SO NOT THAT 6.9 MILLION.

IT'S POSSIBLE NONE OF IT WILL BE SPENT THIS YEAR I DON'T KNOW.

AND SO THAT WOULD CARRY FORWARD INTO FUND BALANCE.

IF OUR HOT REVENUES INCREASE SUBSTANTIALLY, THEN THAT SPLIT BETWEEN US AND THE DEVELOPER, LANDRY'S, IS HIGHER.

SO WE COULD GET MORE THAN 5 MILLION IN REVENUE IF HOT FUND REVENUE OVERALL INCREASES.

BUT THEY ARE SPENDING SOME CAPITAL MONEY ON THE.

AND OF COURSE, WE HAVE A SEAT ON THE CONVENTION CENTER MANAGEMENT, BUT WHATEVER THEY CALL IT AND BUT THEY ARE YOU KNOW, WE HAVE TO INVEST, REINVEST IN THAT FACILITY.

AND SO THEY'RE SPENDING SOME MONEY UP THERE, THERE'S ROOFING GOING ON.

THERE'S I MEAN, IT'S A IT'S A WATERFRONT PROPERTY AND IT TAKES QUITE A BIT OF MONEY TO MAINTAIN IT.

AND WE'VE BEEN SHARING THAT FUND BALANCE HAS BEEN GROWING PARTIALLY BECAUSE THE HEART'S BEEN COMING IN MORE THAN PROJECTED.

WE DON'T THINK THAT'S GOING TO BE THE CASE GOING.

THAT'S MY OWN. THAT'S MY CONCERN.

THIS THIS FUND BALANCE AND USING THIS TO CONTINUE THE FUND.

ALL OF THESE THINGS MAY HIT US SOONER THAN WE THINK.

THAT'S WHY IT'S CRITICAL.

AND THAT'S WHY I CONTINUOUSLY REMIND YOU GUYS DON'T ALWAYS JUST OFFER UP TRICKLE DOWN BECAUSE YOU'VE GOT YOU'VE GOT LONG TERM COMMITMENTS TO TRICKLE DOWN IN TERMS OF YOUR TROLLEY OPERATIONS AND MARDI GRAS AND SOME OTHER THINGS.

AND OF COURSE, MARDI GRAS IS GOING TO CONTINUE TO GET MORE AND MORE EXPENSIVE JUST BECAUSE SECURITY COSTS ARE MORE EXPENSIVE.

WE'RE IN A DIFFERENT WORLD NOW.

YEAH. SLOPED ROOFS ARE A CONCERN.

SO WE HAVE TO WORRY ABOUT THOSE THINGS.

SO IT'S A BIG DIFFERENCE FOR US NOW.

AND SO THAT FUND BALANCE PROBABLY WILL MATRICULATE DOWN, ESPECIALLY IF REVENUE REMAINS FLAT ON HOT.

MURRAY. SO ARE WE GOING TO ADD TO THIS BUDGET? THE JUNETEENTH FIREWORKS, SINCE IT'S THE BIG ANNIVERSARY, OR WE COULD THAT'S AVAILABLE TO YOU TO DO THAT.

WE'VE I KNOW MISS LEWIS HAS ASKED FOR SOME HELP FROM THE PARK BOARD ON THAT, AND THEY'VE TAKEN UP THAT CAUSE, SO WE'LL HAVE TO WORK THAT OUT WITH THEM.

WELL, YOU HAVE PROMOTIONAL MONEY THAT YOU SEND TO THE PARK BOARD EVERY YEAR FOR THESE TYPE PURPOSES.

THE FACT THAT WE'RE EVEN PAYING FOR THE 4TH OF JULY FIREWORKS IS A LITTLE BIT OF A BONE OF CONTENTION FOR ME.

BUT THAT'S A POLICY DECISION FOR YOU GUYS.

AND THIS IS A QUESTION MAYBE YOU CAN GET ANSWERED.

BOB. SO I KEEP HEARING FROM THE PARK, DIFFERENT PARK BOARD PEOPLE THAT THE PARK BOARD CITY HAS TAKEN OVER EVENTS.

PARK BOARD DOESN'T DO THEM.

WELL, WE'RE THAT'S A DISCUSSION THAT'S GOING ON AND THAT'S NOT BEEN DETERMINED AS YET.

THAT'S WHO'S HAVING THAT DISCUSSION.

[01:10:02]

I THINK SHARON HAS BROUGHT THAT SUBJECT FORWARD.

THE STAFF'S I THINK ARE STARTING.

WHEN WILL THE PARK BOARD BUDGET COME TO US? WE ALREADY HAVE IT.

AND AS WE KNOW, PARK BOARD HAS APPROVED IT.

IT WHENEVER COUNCIL WISHES TO SCHEDULE IT IN THE NEXT COUPLE COUNCIL MEETINGS.

PARK BOARD WOULD ABSOLUTELY LIKE IT APPROVED BEFORE THE END OF THE FISCAL YEAR.

IT IS NOT NECESSARILY.

THEIR BUDGET IS NOT PART OF MY DISCUSSION TODAY, BUT I'M HAPPY TO PRESENT ON IT AT SOME POINT IN THE NEXT FOUR WEEKS.

I THINK WE NEED DO THEY HAVE ANYTHING FOR JUNETEENTH BUDGETED IN THAT BUDGET? THEIR APPROVED BUDGET DOES NOT HAVE ANYTHING FOR JUNETEENTH.

SO THEN WE'RE IF THEY'RE NOT GOING TO DO IT, WE'RE GOING TO NEED TO DO IT.

WELL, NOT NECESSARILY BECAUSE WE APPROVED THEIR BUDGET IN THAT THAT NEEDS TO BE DISCUSSED MORE.

YEAH, BUT THAT'S WHERE I THINK WE NEED TO HAVE A BUDGET MEETING WITH THEM BEFORE OUR BUDGET IS FINALIZED TO TALK ABOUT THE REALITIES OF THINGS THAT YOUR REALITY IS THIS BEACH PATROL HEADQUARTERS CONTINUES TO GET MORE AND MORE EXPENSIVE, AND IT'S GOING TO DEPLETE ALL YOUR RESERVES.

SO WE GOT TO GET A HANDLE ON THAT.

WE GOT TO GET A HANDLE ON THAT, I AGREE.

BRIAN, CAN I CORRECT ONE THING? I DID NOT REQUEST THE FIREWORKS FROM THE PARK.

NO, NO, NO. YOU REQUESTED EVENT FUNDING.

THAT'S CORRECT. YES.

OKAY, I NEEDED IT.

I WAS LUMPING THAT TOGETHER, HOPING THAT THAT WOULD BE ONE OF THE EVENTS.

SO JUST TO KIND OF FINISH UP ON SPECIAL REVENUE FUNDING, AND GIVE YOU THE REST OF THE TOUR, IF YOU TURN TO PAGE SF TEN, YOU'RE GOING TO SEE THE INFRASTRUCTURE AND DEBT SERVICE FUND BUDGET.

AND THIS IS IMPORTANT BECAUSE THIS IS THE 8% COMING OUT OF YOUR GENERAL FUND TO FUND INFRASTRUCTURE.

AND IT AS YOU SEE, WE ARE SPENDING IT DOWN ALSO TO ZERO WHERE WE'RE PLANNING TO THIS YEAR, AS WE DO WITH ALL THE SPECIAL REVENUE FUNDS.

THE REVENUE COMING IN HERE IS ABOUT 6.6 MILLION, AND THE MAJORITY OF THIS IS BEING SPENT ON STREETS AND PAVING AND THE RELATED COSTS.

THERE'S A TRANSFER TO TECHNOLOGY.

THERE'S SOME VEHICLE CAPITAL OUTLAY AS WELL.

THERE'S A LITTLE BIT OF CONTINGENCY.

BUT OVERALL, THIS IS WHERE THAT INFRASTRUCTURE MONEY IS GOING.

WHICH LINE IS TECHNOLOGY? IT IS RIGHT IN THE MIDDLE OF THE PAGE.

IT LAST YEAR IT WAS 3 MILLION OR THIS CURRENT YEAR, 24 WAS $3 MILLION BECAUSE OF THE ERP.

BUT THIS YEAR IT'S FOR 25.

WE'RE BRINGING IT DOWN TO 500,000.

AND MOST OF THAT IS GOING TO YOU KNOW, IS DOING A REALLY GOOD JOB OF GETTING MORE TECHNOLOGY ON EVERYTHING.

SO THAT'S A TECHNOLOGY IS BECOMING A BIGGER PART OF WHAT PUBLIC WORKS IS DOING.

IT'S, YOU KNOW, IF YOU LOOK AT THIS, THE INFRASTRUCTURE DEBT FUND, THAT'S 8% OF THE GENERAL FUND'S BUDGET.

SO WHEN YOU PUT THAT IN THERE WITH THE 61% OF PUBLIC SAFETY WERE OVER ABOUT 70%, 70% TIED UP OF MANDATORY USE OF THAT MONEY.

ABSOLUTELY. YEAH, WITHOUT A DOUBT.

SO FINALLY AND I'M GOING TO TOUCH ON HOT NOW.

AND THEN AT THE END OF THE PRESENTATION WE'RE GOING TO CIRCLE BACK TO IT.

ALTHOUGH MAYBE I SHOULD HAVE PLUGGED IT IN HERE BECAUSE WE MIGHT GET SIDETRACKED.

I MIGHT NEED TO MOVE FORWARD.

BUT IF YOU TURN TO PAGE 654, THIS IS WHERE THE NON TRICKLE DOWN HOT FUNDS ARE.

SO ESSENTIALLY THE CONVENTION CENTER SURPLUS FOR THE CITY IS BUDGETED EARLIER BECAUSE THAT'S THE PORTION FOR THE CITY.

BUT HOT OVERALL STARTS HERE ON PAGE 54.

AND YOU'LL SEE THE SUMMARY ON PAGE 54.

YOU WILL SEE SOME OF THE HIGHLIGHTS AND INFORMATION ON HOW EVERYTHING IS CALCULATED ON 55, AND THEN EACH OF THE RELATED FUNDS IN THE FOLLOWING PAGES. AND THE WAY THE CITY CURRENTLY HAS A BUDGETED IS REALLY A MIRROR IMAGE OF LAST YEAR.

WE'RE PROJECTING NO INCREASE IN HOT FUND REVENUE YEAR OVER YEAR, AND SO THE MONEY MOVING OVER IN EACH OF THESE SILOS IS RELATED TO THAT $3.3 MILLION PER PENNY.

BOTH FROM THE CITY SIDE, THE LOCAL SIDE AND THE STATE SIDE.

OKAY. AND WE'RE GOING TO I'M GOING TO DO A DEEP DIVE ON THIS AT THE END OF THE PRESENTATION, BUT I'M HAPPY TO ANSWER ANY QUESTIONS IN THE MEANTIME OR QUESTION ON SF 11. YES.

OKAY. DOES THAT EVEN EXIST ANYMORE? SF 11 SO IT AS YOU CAN SEE, THERE'S NOTHING IN THERE.

[01:15:02]

THERE WAS A BALANCE OF THAT $6,000.

AND THAT WAS MOVED OUT THIS YEAR.

AND UNTIL THERE'S NO MORE ACTIVITY IN THE FISCAL YEARS PRESENTED, IT WON'T MOVE OUT OF THE BUDGET DOCUMENT.

SO NEXT YEAR, 25, IT WON'T EXIST IN 26.

IT WON'T EXIST IN 24.

THAT 24 AMOUNT WILL MOVE TO THE FIRST YEAR, AND SO IN 26 IT WILL NO LONGER BE IN YOUR BUDGET.

THIS WAS THE NEIGHBORHOOD FUNDS.

THIS IS THE NEIGHBORHOOD.

YEAH. AND I CAN PROUDLY SAY, WHEN WE DID THAT, I WAS THE ONLY COUNCIL PERSON THAT SPENT THEIR ENTIRE AMOUNT ON TWO MAJOR ROADS.

I DID SO NO.

NO, ACTUALLY, ACTUALLY YOU DID.

OH. SO.

AND THEN THE REST OF WHAT WAS LEFT.

I SPENT MINE THAT YEAR.

THE NEXT SECTION IS THE DEBT SERVICE FUND SECTION.

SO IF YOU TURN TO THE DEBT SERVICE FUND TAB AND YOU MOVE TO THE FIRST PAGE, DF ONE, YOU'RE GOING TO SEE ON THAT FIRST PAGE, YOU'RE GOING TO SEE ALL THE OUTSTANDING DEBT THAT THE CITY HAS.

IN THAT TABLE, WHICH IS TOTAL ALL PRINCIPAL AND INTEREST INTO PERPETUITY AS IT CURRENTLY EXISTS.

THIS DOES NOT THIS DOES NOT INCLUDE THE PROPOSED ISSUANCE FOR THE EDC.

OKAY. AND IF YOU TURN TO PAGE DF TWO, YOU'RE GOING TO SEE THE ANNUAL PAYMENTS THAT ARE THE OBLIGATIONS OF THE CITY IN FISCAL YEAR 25.

THE ONLY PORTION THAT IS PAID BY PROPERTY TAXES IS THAT VERY TOP PORTION, WHICH IS TOTALING 4.6 MILLION IN FISCAL YEAR 25.

AND THIS IS THE POINT IN THE PRESENTATION EVERY YEAR WHERE I TELL YOU, YOU ARE ONE OF THE LOWEST LEVERAGED CITIES IN THE STATE, AND YOU'RE SENDING MORE TO THE LIBRARY IN THEORY, THAN YOU ARE PAYING IN DEBT SERVICE.

THAT'S CORRECT. WHICH IS IT'S AN IMPORTANT THING TO NOTE.

YEAH. AND YOUR INFRASTRUCTURE SOMEWHAT REFLECTS THIS HISTORICAL TREND.

I WILL TELL YOU THAT IT'S NOT GOING TO GET CHEAPER.

NO. THIS MAY BE AN AREA WHERE WE SEE SOME GROWTH IN THE COMING YEARS.

THE ONLY OTHER THING I WANTED TO BRING TO YOUR ATTENTION IS YOU'LL SEE THE BLUE BAR PORTION OF THE BAR THAT'S RELATED TO GENERAL OBLIGATION DEBT.

AND THE GREEN PORTION OF THE BAR IS YOUR UTILITY BONDS.

SO IF YOUR WATER AND SEWER AND THAT SORT OF THING.

AND SO YOU'LL SEE, HISTORICALLY, THE CITY HAS SPENT A LOT OF THEIR DEBT SERVICE ON IMPROVING THAT WATER AND SEWER INFRASTRUCTURE, ESPECIALLY IN RECENT YEARS.

IF WE MOVE TO THE NEXT SECTION, IT'S YOUR ENTERPRISE FUNDS, WHICH ARE INCREDIBLY IMPORTANT, AND SOMETIMES THEY GET A LITTLE LEFT TO THE END BECAUSE THERE MIGHT NOT BE QUITE AS EXCITING.

BUT IN HERE YOU HAVE YOUR COMBINED UTILITY, YOUR SANITATION, DRAINAGE AND AIRPORT.

AS WE DISCUSSED AT THE PREVIOUS MEETING, THERE ARE SOME STRUCTURAL AND UNSUSTAINABLE ACTIVITIES MAYBE GOING ON IN THE SEWER AND SANITATION FUND THAT YOU'RE GOING TO BE PRESENTED WITH THOSE RATES AT THE NEXT COUNCIL MEETING FOR APPROVAL, BASED ON THE PRESENTATIONS THAT WERE RECEIVED AT THE LAST COUNCIL MEETING. SO THE BUDGET YOU HAVE IN FRONT OF YOU DOES NOT INCLUDE ADDITIONAL REVENUE FROM THOSE RATES BECAUSE THEY HAVE NOT BEEN APPROVED.

AND LET ME LET ME TAKE A MOMENT TO TELL YOU, THIS IS WHEN WE TALK ABOUT GALVESTON BEING UNIQUE.

THIS IS ONE OF THE THINGS THAT MAKES US SOMEWHAT UNIQUE.

WE'RE NOT A CITY FULL OF MUD DISTRICTS.

WE DON'T HAVE SEPARATE UTILITY DISTRICTS.

WE DON'T HAVE SEPARATE EMERGENCY SERVICES DISTRICTS.

MOST OF THE CITIES IN THE COUNTY THAT HAVE EVEN PAID FIRE AND SEPARATE EMERGENCY SERVICES DISTRICTS AND STUFF.

THIS IS WHAT MAKES YOUR, YOU KNOW, WHEN IT MAKES IT VERY HARD TO COMPARE GALVESTON TO OTHER CITIES.

WE'RE OPERATING AN AIRPORT.

WE'RE OPERATING OUR OWN SANITATION DEPARTMENT.

I THINK WE'RE ONE OF ONE IN THE COUNTY THAT DOES THAT.

WE ARE OPERATING OUR FULL WATER AND SEWER CAPACITY HERE.

WE DON'T PRODUCE OR TREAT ANY WATER HERE.

WE'RE BUYING 100% OF OUR WATER.

THERE'S A LOT OF VERY SPECIFIC THINGS THAT GO ON HERE THAT MAKE US UNIQUE.

SO THESE FUNDS YOU'LL HEAR PEOPLE SAY GALVESTON'S DIFFERENT.

AND WE CAN ALWAYS ARGUE WE'RE DIFFERENT FOR A WHOLE HOST OF REASONS.

BUT THIS IS THIS IS THE CHART THAT MAKES YOU VERY, VERY DIFFERENT.

WE NEED TO BE STARTING START LOOKING IN MUDS, BECAUSE WE STILL HAVE WAY TOO MANY PEOPLE ON 100% AGREE, 100% AGREE, AND IT JUST DOESN'T MAKE SENSE.

TOTALLY AGREE. I DON'T BELIEVE THAT TECQ HASN'T COME DOWN ON US.

I THINK THERE'S I THINK THAT PROBLEM EXISTS ACROSS THE STATE.

SO, I DON'T THINK THEY'RE NOT GOING TO JUMP IN ANYTHING THEY HAVE TO PAY FOR PUT IT TO YOU THAT WAY.

[01:20:02]

AND THERE ARE FUNDS WHERE WE NEED TO GET CREATIVE, WHERE THERE'S GRANTS BOTH ON THE TECQ SIDE BUT ALSO ON THAT GLO SIDE THAT WE COULD BE PURSUING, THAT WE COULD USE TO GET THE ONE AREA ON THAT PIE CHART THAT'S GOING TO CONTINUE TO GROW IS DRAINAGE. WE'RE GETTING WE'VE BEEN VERY SUCCESSFUL IN RECEIVING THESE GRANTS, AS MARIE POINTS OUT.

BUT, YOU KNOW, YOU DON'T JUST YOU'RE NOT ONE AND DONE WITH THESE THINGS.

AND EVERY TIME THEY RUN, THEY REQUIRE MAINTENANCE AND THEY'RE GOING TO BE VERY MAINTENANCE INTENSIVE TO OPERATE AND TO MAINTAIN.

SO DRAINAGE IS GOING TO CONTINUE TO GET MORE AND MORE EXPENSIVE ON THE ISLAND AS.

BUT WE NEED TO BE WE NEED TO LIKE I'M GOING TO HAVE A SERIOUS DISCUSSION WITH TXDOT AND THAT 3 TO 5, BECAUSE WHEN I WAS UP AT THE TPC, THEY COMMITTED TO ME THAT THEY WOULD BE DOWN.

AND NOW I'M HEARING THEY'RE SAYING, YEAH, AFTER LABOR DAY.

LABOR DAY. YEAH. THAT IS SUCH POOPOO.

YEAH, YEAH.

I MEAN WHEN I'M REFERRING TO DRAINAGE, I'M MORE REFERRING TO THE CHALLENGES.

I MEAN, WE'RE DRAINING THIS ISLAND THROUGH STRAWS AND WE'VE GOT VERY LONG RUNS OF PIPE.

IT'S A VERY EXPENSIVE SYSTEM TO MAINTAIN.

WE REQUIRE A LOT OF PONDING.

IN ORDER FOR THE SYSTEM TO WORK, WE REQUIRE.

WE REQUIRE A LOT OF SHEET DRAINING OVER VERY LITTLE FALL.

SO IT'S A VERY EXPENSIVE.

IT DOESN'T TAKE BUT A PILE OF LEAVES TO REALLY SCREW THINGS UP.

SO IT'S AN EXPENSIVE UTILITY TO MAINTAIN.

I JUST WANT TO POINT THAT OUT TO YOU THAT THAT'S GOING TO BE A NUMBER THAT GROWS BEYOND WHEN WE'RE HERE.

I DO THAT MORE FOR THE PEOPLE WATCHING THAN FOR YOU GUYS.

I THINK YOU GUYS ALL REALIZE THIS BUT.

BUT WE HAVE DITCHES.

I WOULD ARGUE AT THE END OF THE DAY, WHEN WE'RE ALL SAID AND DONE WITH DRAINAGE, PEOPLE ARE GOING TO BE VERY THANKFUL THEY HAVE DITCHES VERSUS THE PIPES.

THE PIPES ARE A LOT HARDER TO MAINTAIN.

WHEN YOU WHEN YOU'RE FLOODED IN YOUR HOUSE, I BEG TO DIFFER.

YEAH, WELL THAT HAPPENS WHERE THERE'S PIPES BECAUSE OF BECAUSE OF DENTAL ACT THOUGH.

YEAH. SO ON EF2, JUST TO KIND OF REINFORCE WHAT I SAID IN THAT FY 25 COLUMN, YOU'LL SEE THE BEGINNING FUND BALANCE IS 18.6 MILLION COMBINED BETWEEN ALL THE ENTERPRISE FUNDS.

AND AT THE BOTTOM RIGHT HAND CORNER, YOU SEE THAT THAT DECREASES TO 14.2 MILLION AT THE END OF THIS FISCAL YEAR.

AND THIS IS WITHOUT THOSE RATE INCREASES.

AND SO IT'S JUST IMPORTANT TO UNDERSTAND THAT WITHOUT THE RATE INCREASES, THERE'S GOING TO BE A CONTINUAL DRAWDOWN.

AND AT SOME POINT THAT THERE WON'T BE ANYTHING TO DRAW FROM.

YEAH. AND IT'S IMPORTANT IT'S IMPORTANT TO HAVE THOSE BALANCES IN THERE BECAUSE, I MEAN, I'LL GIVE YOU A PRIME EXAMPLE.

WHEN THOSE POLES UPROOTED IN INDIAN BEACH, IT TOOK OUR WATER LINE WITH US.

SO I MEAN, WE HAVE IT WE HAVE WE HAVE TO HAVE SOME MONEY TO DO THESE THINGS.

SO CAN YOU GIVE US I'M SURE IF RATE INCREASES ARE GOING TO SHOW UP, WE'LL GET IT.

BUT PRIOR TO CAN WE GET KIND OF THIS PAGE WHAT THE PROJECTION WOULD BE WITH THE RATE INCREASES? YES. WE CAN DO THAT.

YEAH. OKAY.

SO FINALLY, WE'RE LOOKING AT THE INTERNAL SERVICE FUNDS, WHICH IS THE INTERNAL SERVICE FUND TAB.

AND AS ALL OF THESE SECTIONS ARE SET UP AND STRUCTURED FOR EACH DEPARTMENT, LIKE I DEMONSTRATED WITH THE POLICE DEPARTMENT.

SO FEEL FREE TO LEAF THROUGH IT ALL.

I'M NOT SKIPPING OVER IT BECAUSE IT'S NOT IMPORTANT.

I'M SKIPPING OVER IT BECAUSE WE DON'T HAVE ENOUGH TIME.

WHICH ARE WE SKIPPING OVER? WELL, JUST THE REST OF THE ENTERPRISE FUND PAGES, BUT TO THE INTERNAL SERVICE FUND TAB.

AND THE FIRST PAGE AFTER THAT IS IF ONE.

AND HERE YOU HAVE THE SUMMARY OF ALL THE INTERNAL SERVICE FUNDS, WHICH INCLUDES ALL OF OUR INSURANCE, BOTH HEALTH AND PROPERTY AND LIABILITY INSURANCE.

IT INCLUDES OUR GARAGE AND OUR CENTRAL SERVICES.

AND SO YOU'LL SEE THAT OUR TOTAL EXPENDITURES IN THESE FUNDS IS ABOUT 32 MILLION, 32.7 MILLION FOR FISCAL YEAR 25.

AND I'M HAPPY TO ANSWER ANY QUESTIONS.

THE ONLY OTHER IMPORTANT THING TO NOTE IS THAT HEALTH AND LIFE INSURANCE IS THE REALLY BIG PIECE OF THE PIE.

IT'S $15.4 MILLION, AND WHILE THE OTHERS ARE INCREDIBLY IMPORTANT, THIS PIECE IS THE ONE THAT KEEPS EXPANDING, AND WE ARE SOMEWHAT LIMITED IN SHIFTING ANY BURDEN TO THE EMPLOYEES.

AND I DON'T WANT TO SHIFT THE BURDEN TO THE EMPLOYEES, BUT WE'RE SOMEWHAT LIMITED BY YOUR LABOR CONTRACTS.

WE'RE PRETTY MUCH MAXED OUT THERE.

IS THAT 10% TO 10%? YES. IT'S BUDGETED TO BE UP 10% YEAR OVER YEAR, THAT IS IT'S SELF-FUNDED AT ALL.

YEAH. WELL, NO, WE'RE 100% SELF-FUNDED ON HEALTH INSURANCE.

CORRECT. BUT WE DO HAVE REINSURANCE, YOU KNOW, STOP GAP COVERAGE AND THINGS LIKE THAT.

BUT THAT'S FACTORED INTO THAT COST.

AND LET ME ANOTHER JUST A WORD.

THERE'S BEEN LEGISLATIVE CHANGES ESPECIALLY FOR FIREFIGHTERS AS IT RELATES TO WORKER'S COMPENSATION.

I FULLY ANTICIPATE THAT NUMBER TO CONTINUE TO RISE AS MORE AND MORE OF THESE DIFFERENT CANCERS ARE COVERED UNDER WORKERS COMP VERSUS JUST TRADITIONAL HEALTH INSURANCE.

[01:25:09]

ABSOLUTELY I AGREE.

SO FINALLY, JUST TO GO OVER THE CAPITAL IMPROVEMENT PLAN, THAT'S THE NEXT TAB.

YOU HAVE CAPITAL IMPROVEMENT PLAN.

AND WE REVIEWED SOME OF THIS PREVIOUSLY.

BUT I JUST WANT TO GIVE YOU THE HIGHLIGHTS OF WHAT INFORMATION IS PRESENTED HERE.

SO YOU HAVE THAT SUMMARY GRAPH WHICH SHOWS YOU WHERE OUR CAPITAL IMPROVEMENT PROGRAM DOLLARS ARE GOING OVER THE COMING FISCAL YEAR.

WITH WATER GETTING 28%, SEWER GETTING 15% AND DRAINAGE GETTING 22% AND STREETS GETTING 23%.

THIS IS PAGE CP1.

PAGE CP3 HAS YOUR FUNDING SOURCES, WHICH YOU'LL SEE REVENUE SUPPORTED IS COMING FROM YOUR RATES AND THE DEBT SERVICE BEING PAID BY THOSE RATES.

THERE ARE SUPPORTED SOURCES, BUT THEN THERE'S ALSO OTHER FUNDING SOURCES, WHICH IS PREDOMINANTLY GRANTS.

IN THIS CASE, WE'RE GETTING A LOT OF FUNDS FROM THE FEDERAL GOVERNMENT AS WELL AS SOME CDBG FOR STREETS, SOME ACROSS THE COUNTY.

WE'RE ONE OF THE MOST SUCCESSFUL CITIES IN GETTING THESE GRANTS.

I WILL TELL YOU THAT THE TOTAL BUDGET GRANTS AIN'T FREE.

I'M GOING TO SAY THAT, TOO.

WE HAVE TO HAVE THE MATCH.

YEAH, WE ABSOLUTELY HAVE TO HAVE THE MATCH.

YOU'LL SEE ON PAGE CP2 THAT THE TOTAL PROJECTED CIP FOR THE NEXT FIVE YEARS IS $606 MILLION.

OF THAT, 260,000 OR 260 MILLION IS PROGRAMED FOR 2025.

OKAY. IF YOU TURN TO PAGE CP FOUR, THIS IS WHERE ALL YOUR FUNDING SOURCES ARE CAPTURED IN THIS TABLE.

AND I'M NOT GOING TO GO THROUGH ALL THAT, BUT YOU'LL SEE THE DEBT SERVICE IN THE MIDDLE.

YOU'LL SEE IDC, ESPECIALLY IN ITS CONTRIBUTIONS THIS YEAR, AS WAS NOTED, AND YOU'LL SEE THE OTHER SOURCES, WHICH IS RELATED TO THE GRANTS.

AND THIS IS OUR PLAN FOR FUNDING THAT $606 MILLION WORTH OF INFRASTRUCTURE I GOT A ON CP3 DOWN AT THE BOTTOM.

ABOUT GRANTS.

YES. MAYBE I'M UNAWARE, BUT ARE THERE? I KNOW THERE'S A TON OF GRANTS THAT AREN'T ELIGIBLE TO USE THIS MATCH FUNDING.

ARE THERE SOME GRANTS THAT ARE ELIGIBLE TO BE USED AS MATCH FUNDING? THOSE ARE BECOMING FEWER AND FAR BETWEEN, ESPECIALLY ON THE BECAUSE MOST OF OUR GRANTS ARE COMING EITHER THROUGH FEMA OR THROUGH THE STATE.

THERE'S NO YEAH THERE'S NO THEY DON'T NECESSARILY LIKE YOU TO DO THAT.

SOMETIMES YOU CAN GET SOME SMALLER LOCAL GRANTS FOR MATCHES AND SOMETIMES HGC CAN HELP YOU WITH THOSE THINGS, ESPECIALLY ON STREET PROJECTS AND THINGS.

BUT FOR MOST OF THESE PROJECTS, NO, IT'S ALL GOING TO BE LOCAL MATCH.

SO WHAT'S THE THEY WANT YOU TO HAVE SKIN IN THE GAME.

WE HAVE A I MEAN DO WE HAVE BUDGET.

WHERE ARE WE PULLING THE MATCH.

THE MATCH FUNDS FROM THE MATCHES ARE ALL YEAH.

SO THE MATCHES ARE GOING TO BE WHETHER IT'S YOU'RE USING BOND REVENUE ON SOME OF THE WATER SEWER STUFF, ON THE DRAINAGE STUFF.

WE DO HAVE THE OPPORTUNITY TO USE.

SO ESSENTIALLY WE'VE GOTTEN SOME FEDERAL MONEY, SOME EARMARK MONEY, AND THEN WE'VE GOT THE GLO.

AND SO THERE IS SOME MATCHING THERE THAT WE'RE HOPEFULLY NOT GOING TO HAVE TO FUND AS MUCH LOCALLY BECAUSE WE'VE BEEN ABLE TO MATCH TWO SOURCES OF FUNDING, NOT EARMARK ANYMORE.

IT'S COMMUNITY SERVICE, OKAY, COMMUNITY SERVICE FUNDING FROM THE FEDERAL GOVERNMENT.

BUT SO THERE ARE SOME MATCH OPPORTUNITIES ON THAT ON THOSE PROJECTS.

AND, AND I WOULD BEG TO DIFFER ON LIKE FUNDS THAT WE MIGHT BE ABLE TO GET FROM HGAC.

I THINK WE SHOULD BE KEYING UP ANYTHING WE HAVE SHOVEL READY.

I AGREE RIGHT NOW AND WE SHOULD BE SUBMITTING HVAC.

HOW DO YOU SAY THIS IN A NICE WAY? THEY HAVE A LOT OF UNSPENT MONEY THAT THEY HAVE TO DEAL WITH, BECAUSE CITIES, THEY HAVE A LOT OF CARRY FORWARD THAT THEY HAVE TO DEAL WITH.

A LOT OF CITIES, THEIR EYES ARE BIGGER THAN THEIR STOMACH SOMETIMES.

AND THEY GO OUT AND THEY GET THESE GRANTS AND THEY CAN'T PERFECT OR PERFORM.

SO THAT MONEY FALLS BACK AND HGC NEEDS TO MOVE THAT MONEY ALONG.

THAT'S WHY WE'RE SO BIG ON KEEPING PROPERTY ACQUISITION AHEAD, KEEPING ENGINEERING AHEAD AND DOING THOSE THINGS, KEEPING AS MUCH AS WE CAN, OR AS CLOSE TO SHOVEL READY AS WE CAN ON THESE PROJECTS. AND WE'VE BEEN REALLY SUCCESSFUL IN THAT.

BUT I WOULD LIKE TO HAVE A MEETING WITH WHOMEVER WHERE WE CAN BEING THAT THAT'S A VERY HOT TOPIC.

I MEAN, WE'RE GOING TO WE'RE GOING TO DO REALLY WELL WITH THE LIVABLE COMMUNITIES MONEY THAT WAS LEFT OVER DOWNTOWN AS A RESULT OF THAT, BECAUSE WE'RE READY TO GO.

BUT I MEAN, ASIDE FROM THE LIVABLE, THERE'S A LOT OF OTHER.

ABSOLUTELY. I'D LIKE TO SIT DOWN WITH WHOEVER OUR ATTACK REPRESENTATIVE IS AND, YOU KNOW, THE GUYS WHO DO STREETS AND WHATNOT.

[01:30:06]

OKAY. BECAUSE THEY'RE THEY'RE BEING TASKED RIGHT NOW TO SPEND DOWN THAT CARRY FORWARD.

CORRECT. WE'RE HAPPY TO TAKE IT.

IS THAT IS IS THEIR EYES LIGHT TWINKLE WHEN THEY TALK ABOUT IT? I KNOW THE COUNTY'S DOING THE BOND IN 25.

WE HAVE NOT GOTTEN ANY DEFINITIVE ANSWER, BUT THAT'S PART OF THEIR DISCUSSION.

YES. SO THAT WOULD NOT BE IN HERE AT ALL.

HAVE WE HAVE WE SET ASIDE ANYTHING FOR THOSE POTENTIAL.

POTENTIAL. NO.

BECAUSE CHANCES ARE THE EXPENDITURE OF THOSE FUNDS WOULDN'T BE IN 25 ANYWAY.

THEY WOULD BE IN 26 OR 27 ON THE CB ONE, THE WATER 28%.

WHAT IS THE WHAT IS THE BREAKDOWN OF THAT COST? WHAT IS IT? ABOUT TO SHOW YOU WHAT I KNOW, YOUR QUESTIONS ARE NOT EVEN PAYING ME FOR THIS.

FORECAST YOU INTO YOUR NEXT SECTIONS, RIGHT? HE'S GIVING YOU THE LEAD IN.

I GOT A QUESTION FOR YOU LEAVE CP4, IF YOU DON'T MIND.

YES. OTHER UNDER OTHER FUNDING SOURCES, FEMA IS THE SECOND LARGEST FUNDING SOURCE FOR THAT.

BUT ISN'T FEMA DISASTER RELATED? THAT IS, IF WE HADN'T HAD A DISASTER, WE WOULDN'T BE GETTING FEMA FUNDS.

CORRECT. TESSA IS A MASTER AT TAPPING INTO THOSE FUNDS BECAUSE, REMEMBER EVEN THOUGH WE MAY NOT TAKE A DIRECT HIT, DEPENDING ON THE EVENT, IT OPENS UP FUNDING CYCLES FOR DIFFERENT THINGS. SO LIKE WE'RE DOING THE WHOLE DOWNTOWN DRAINAGE STUDY RIGHT NOW BASED OFF OF A FEMA GRANT.

SO A LOT OF THAT'S WHAT YOU'RE SEEING IN THERE.

AND THE PUMP STATION ON 14TH STREET HAS A HUGE AMOUNT OF FEMA FUNDING.

AND AS A RESULT OF SO THIS 37 MILLION IS MITIGATION GRANTS, FOR THE MOST PART, THAT FROM PREVIOUS EVENTS HAVE RESULTED IN OUR ABILITY TO GET GRANTS TO MITIGATE FUTURE THINGS.

THIS IS NOT RELATED TO ANYTHING THAT OCCURRED WITH HURRICANE BERYL.

THERE'S NO RECEIVABLES IN HERE AT ALL FOR BERYL.

OKAY. THIS IS THIS IS HARVEY.

OH, IT'S. I PROBABLY LIKE ANYTHING THAT'S OCCURRED THAT PUTS HARVEY.

THERE'S A COUPLE LITTLE TROPICAL STORMS IN THERE THAT.

WHEN'S THE I GUESS WHEN FINALLY, WHEN'S THE IKE FUNDING FINALLY DRY UP? WE HOPE THAT EVERYTHING WILL BE CLOSED OUT BY THE END OF DECEMBER.

THAT IS OUR GOAL THIS DECEMBER.

THIS DECEMBER. AND WE MAY THROW A SMALL PARTY.

THERE MIGHT BE FIREWORKS, I DON'T KNOW.

BUT MY POINT IN ASKING THAT QUESTION WAS REALLY THAT THIS, THAT LARGE AMOUNT OF FUNDING REALLY DOESN'T HAVE ANYTHING TO DO WITH THE DAY TO DAY OPERATIONS AND THE DAY TO DAY NORMAL STUFF THAT THAT REALLY ADDRESSES EMERGENCIES OR DISASTERS, WHICH THAT WOULDN'T BE THERE UNLESS WE HAD THOSE DISASTERS.

CORRECT? THAT'S CORRECT.

WELL, A LOT OF THIS IS DRAINAGE, RIGHT.

AND SO THESE THIS SPECIFIC $37 MILLION IS DRIVEN BY THE FACT THAT THERE ARE DRAINAGE ISSUES, AND IT MAKES US ELIGIBLE FOR THIS MITIGATION MONEY.

YEAH. SO, I HOPE WE'RE GOING AFTER FEMA FUNDS FOR THE STREET DAMAGES THAT WE HAD WITH THERE.

THEY WILL BE THERE WILL BE PROJECTS GENERATED AS A RESULT.

AND BERYL, AND ESPECIALLY AFTER OUR CONVERSATIONS WITH THE GLO.

SO, IT'S PRETTY LIKELY THAT FEMA SOURCE WILL CONTINUE BECAUSE IT'S PRETTY LIKELY WE'RE GOING TO HAVE.

I THINK YOU'RE GOING TO HAVE FEMA LINE ITEMS IN THIS BUDGET FOREVER, RIGHT? AND LIKE I SAY, IF WE WERE A MIDWEST CITY OR SOMETHING, YOU KNOW, DIDN'T HAVE ANY IF YOU WERE ON A RIVER, PROBABLY THE SAME WAY IF YOU'RE IF YOU'RE MISSISSIPPI.

YEAH, YEAH, YEAH.

VERY FEW PLACES IN THE COUNTRY DON'T HAVE THIS UNTIL THE UNTIL THE FEDERAL GOVERNMENT CHANGES THEIR FUNDING SCHEME FOR THESE TYPES OF THINGS.

FEMA IS GOING TO BE A PART OF OUR LIFE HERE FOREVER.

THERE'S NO FUTURE CDBG GRANTS THAT ARE NO, NOT AT THIS POINT.

WE'RE GOING TO BE CHASING SOME.

BUT, YOU KNOW, KEEP IN MIND PART OF WHAT LIMITS IS I MEAN, THERE'S ALWAYS GRANTS TO CHASE, BUT WE HAVE TO WE HAVE TO MEASURE THAT OUT WITH WHAT WE HAVE AVAILABLE FOR MATCHES, TOO. SO, WHAT'S THE I MEAN, I'M JUMPING AHEAD, BUT WHAT'S THAT 5 MILLION PROJECTED FOR THE REVENUE PRODUCING PARK FUNDS.

HOLD ON. WHAT ARE THE REVENUE PRODUCING PARKS? REVENUE PRODUCING PARKS? WE'RE GOING TO HAVE THIS BIG, HUGE THING AT THE POOL, AND IT'S GOT A SUBTLE, LINGERING ANSWER.

THAT'S A JOKE. THAT'S THE BEACH POCKET PARKS THAT WE OPERATE.

THAT'S ONE, TWO, THREE, ONE, TWO, THREE AND FOUR.

FOUR DOESN'T PRODUCE A LOT OF REVENUE.

OH FOUR IS GOING TO HAVE THE CAPABILITY TO.

ABSOLUTELY. IT WILL SOME EXCITING THINGS HAPPENING THERE.

SO PAGE CP6 IS THE DEBT FORECAST.

AND I'M NOT GOING TO TALK ABOUT IT EXCEPT TO SAY I'M AT THIS POINT PROJECTING THAT THERE WILL BE WATER SEWER DEBT ISSUED NEXT YEAR OR THE FOLLOWING YEAR.

AND I'M JUST PUTTING THAT IN THE UNIVERSE SO EVERYBODY KNOWS, AND I'M GOING TO MOVE ON AND LOOK AT PAGE CP NINE.

AND JUST TO GIVE YOU AN IDEA OF WHAT ALL OF IT LOOKS LIKE BECAUSE THERE'S DETAIL HERE TO REVIEW.

SO IN EACH AREA YOU HAVE AN OVERVIEW OF THE ACTIVITY THAT'S OCCURRING.

IN THIS CASE WE'RE LOOKING AT STREETS AND TRAFFIC AND THE EVALUATION SYSTEM FOR HOW IT'S DETERMINED, WHAT IS FIXED, THE ANTICIPATED PROJECTS.

[01:35:09]

AND SO SPECIFICALLY, WHAT PROJECTS ARE BEING COMPLETED OR PLANNED FOR COMPLETION OR WORK, AND THEN THE FUNDING SOURCE THAT'S CORRELATED OR THE TOTAL FUNDS AND THEIR PROJECTED FUNDING SOURCE GOING FORWARD.

AND THIS IS JUST THE SUMMARY PORTION THAT IS IN THE BUDGET IN THE OTHER BINDER THAT WE ARE NOT GOING TO OPEN RIGHT NOW BECAUSE THERE'S NOT ENOUGH ROOM ON THE TABLE.

IS THE DETAIL RELATED TO EACH PROJECT AND THE BUDGET RELATED TO EACH PROJECT.

AND SO IF IT'S A DRAINAGE QUESTION OR A STREET QUESTION, YOU CAN SEE WHAT THE PROJECTS ARE AND GO CHECK IT OUT IN YOUR OTHER BINDER AND ASK ANY FOLLOW UP QUESTIONS RELATED TO ON THIS. THESE PAGES HAVE TWO BINDERS OPEN.

YES, YES. WE ONLY INCLUDE ONE YEAR IN THE OF THE CAPITAL PLAN IN THE BUDGET, BUT THAT CIP IS A FIVE YEAR CIP AND THAT'S APPROVED AS A PORTION OF THIS. AND WITHIN THIS ALSO YOU WILL SEE CASH FLOWS AS WELL AS PROJECTIONS FOR THIS CURRENT YEAR.

AND SO AS YOU FLIP THROUGH THE THIRD QUARTER STATUS UPDATE, IT STARTS ON PAGE CP 29 WITH THE YELLOW BAR.

AND THIS IS GIVING YOU THE STATUS OF THE ACTIVITY OF CAPITAL PROJECTS IN 2024.

AND THEN WHEN THE YELLOW BARS END AND YOU GET THIS MULTICOLOR THIS IS YOUR CASH PROJECTIONS RELATED TO ALL OF OUR CAPITAL ITEMS. OKAY. SO BASICALLY A LOT OF THESE GRANT PROGRAMS, WE'RE FRONTING THE MONEY.

YES, ABSOLUTELY.

AND IT'S REIMBURSED BALANCE ALSO COMES INTO PLAY.

IT'S INCREDIBLY IMPORTANT BECAUSE THEY'RE REIMBURSABLE THEY'RE REIMBURSABLE.

BUT WE HAVE TO BE ABLE TO HAVE THE CASH TO DO IT ON THE FRONT.

AND SOMETIMES THEY'RE VERY TIMELY AND SOMETIMES THEY ARE NOT.

SO LIKE ON WATER WORKS THAT'S WHY WE HAVE THE IN AND OUT BEING THE SAME.

LET ME LOOK. WHAT PAGE ARE YOU ON? CP18. CP18.

WELL, SO THE TOP PORTION IS YOUR PROJECTS.

YES. AND THE BOTTOM PORTION IS YOUR FUNDING SOURCES RELATED TO THAT.

SO THEY'VE PLANNED $60 MILLION WORTH OF PROJECTS.

AND THEN BELOW THAT WE'RE SHOWING WHAT THE FUNDING SOURCES ARE.

SO SOME OF IT 900,000 IS THE IMPROVEMENT FUND.

WE'RE FINISHING SPENDING SOME MONEY IN THE 2019 COS THOSE SHOULD BE OFF THE BOOKS.

THEY WILL BE FINISHED BY THE END OF THIS FISCAL YEAR HOPEFULLY.

AND THEN 23 MILLION IS COMING FROM COS THAT WERE ISSUED IN 22.

SO YES, IF YOU'RE GOING TO FUND ALL OF YOUR CAPITAL PROJECTS THAT YOU HAVE PLANNED, YOU NEED TO MAKE SURE WE NEED TO MAKE SURE WE HAVE FUNDING SOURCES ASSOCIATED WITH IT.

THE CDBG, THAT'S THE PUMP STATION ADDITIONAL FUNDING FOR THE PUMP STATION.

SO THIS IS WATERWORKS, SO.

OH, NEVER. SORRY. NO.

AND I WOULD HAVE TO FIGURE OUT WHERE.

THAT'S IT. FIGURE OUT EXACTLY WHAT PROJECT IT'S ASSOCIATED WITH.

WE HAVE A WHOLE BUNCH CAUSEWAY WATER WATERLINE ON CP 30.

YES. AND WE TALK ABOUT SEAWALL PEDESTRIAN SAFETY.

YES. I MEAN, THAT SEEMS LIKE THAT COULD BE SOMETHING WE ARE FUNDING THAT OUT OF BEACH USER FEES OUT OF THE SEAWALL PARKING FUND.

WHAT ARE YOU WHAT ARE YOU LOOKING AT? I'M TALKING ABOUT ON CP 30, THE PEDESTRIAN SAFETY.

OH, YEAH. AND THIS IS THIS IS THE UPDATES ON CURRENT YEAR ACTIVITY ON CP 30 ALREADY.

SO THESE ARE ITEMS THAT ARE BEING WORKED ON THIS YEAR.

WHEN ARE THOSE PROJECTED LIGHTS THAT WE CAN GET THEM UNDER CONSTRUCTION IN 25.

IN THAT CASE FOR THE PEDESTRIAN IMPROVEMENTS.

YEAH FOR THE SAFETY GRANT.

THAT'S A STUDY THAT ROBB IS.

NO NO NO NO NO NO. WE'RE TALKING ABOUT THE SIGNALS.

THE SIGNALS THAT SHOULD HAVE WENT IN LAST YEAR.

90% DESIGN. SO WE SHOULD BE DOING NEXT SIX MONTHS.

WE'D BE BREAKING GROUND ON THOSE.

BRIAN, DO YOU KNOW WHERE THE OAKS PROJECT IS FOR THE LIGHTING? IT'S, THAT WAS PART OF THAT OTHER MONEY IT'S FUNDED THIS YEAR.

WE'VE GOT THAT FUNDED.

OKAY. I HATE TO INTERJECT, BUT THIS SEEMS LIKE SOMETHING.

WHAT SHE BROUGHT UP SEEMS LIKE SOMETHING THAT POTENTIALLY COULD BE SUPPLEMENTAL.

WHEN THEY'RE TALKING ABOUT RAISING THE NORTH SIDE OF THE SEAWALL, I MEAN, WE'RE PUTTING BARRIERS UP SOMETHING SIMILAR.

I MEAN, WE'RE NOT PUTTING ANY BARRIERS UP.

WE'RE PUTTING WE'RE PUTTING SIGNAL CROSSINGS UP.

BUT YEAH, IT SAYS LOW LINEAR BARRIER ALONG THE NORTH SIDE OF SEAWALL.

SO I THINK THAT'S THE PEDESTRIAN BARRIER SO THAT PEOPLE KNOW WHERE THE SIDEWALK ENDS AND THE CARS.

[01:40:02]

SO THEY PARK, LIKE ALL THE WAY UP ON THE PORCH AT THE SPOT.

OF SIDEWALK.

SO BEFORE WE HEAD INTO THE HOT THE HOT PRIMER, DO WE? YES. BEFORE WE LEAVE THIS, I WOULD LIKE TO COME BACK AND REVISIT THE COLAS, IF WE COULD.

OKAY. REVISIT THE WHAT? THE COLAS IS THE COST OF LIVING INCREASES FOR THE CIVILIAN EMPLOYEES.

WE HAVE 4%.

IT'S PROGRAMED IN THE BUDGET.

WHAT? HOW MUCH MORE WOULD NEED TO BE PROGRAMED INTO THE BUDGET DOLLAR WISE, TO MOVE US, SAY TO FIVE.

IT WOULD BE ANOTHER ABOUT $170,000.

IT'S ABOUT 170, 175 PER PERCENT WITH IMPACT IN THE GENERAL FUND.

OKAY. SO IF WE MOVE THIS TO FIVE THAT WOULD MOVE THE AND THAT MONEY.

WOULD THE WAY I VIEW THIS THAT WOULD COME OUT LOWERING THE.

AT THIS POINT IT WOULD THE ONLY OPTION YOU WOULD HAVE WOULD BE TO LOWER THE FUND BALANCE IN ROWE LOWER THE FUND BALANCE THAT WOULD THAT 170 OR 75 THAT WOULD HOW MUCH WOULD THAT MOVE IT TO 105 TO 103 OR I DON'T KNOW HOW THAT SO IT WOULD BE ABOUT ONE DAY I, THAT WOULD BE MY MATH.

IT WOULD TAKE YOU.

YEAH. YOUR BURN IS.

YEAH. IT'S GOING TO BE ABOUT 200,000 JUST VERY GENERALLY PER DAY.

AND SO IT WOULD TAKE YOU DOWN TO ABOUT 104 DAYS.

104 DAYS.

YEAH. WELL I'M GOING TO, I'M GOING TO RECOMMEND THAT WE MOVE TO 5% ON THESE CIVILIAN EMPLOYEES.

GREG, YOU'RE BASING YOUR NOTION, I GUESS, ON MAINTAINING COMPETITIVENESS WITH OUR STAFF, WITH OTHER, OTHER PLACES.

IS THAT WHAT YOU'RE TRYING TO GET AT? WELL, NOT ONLY THAT, BUT THE AND I'M GOING TO MAKE AN EDITORIAL STATEMENT EACH YEAR.

WE PUT A LOT OF ATTENTION TO FIRE AND POLICE AND THAT'S I'M ALL FOR THAT.

AND THAT'S VERY IMPORTANT.

OUR CIVILIAN EMPLOYEES GET LEFT BEHIND A LOT EVERY YEAR ON COLA INCREASES AND MERIT INCREASES, THINGS LIKE THAT. AND THE ONLY WAY THEY HAVE OF OUR CIVILIAN EMPLOYEES THAT WORK VERY HARD IN THESE EMERGENCIES SIGNIFY THAT THEY'RE OUT THERE WORKING SEVEN DAYS A WEEK, 16 HOUR DAYS.

THE ONLY WAY THAT THEY GET INCREASES, THEY DON'T HAVE COLLECTIVE BARGAINING OR ANYTHING.

THEY HAVE TO RELY UPON THESE COLAS ON THESE COST OF LIVING INCREASES.

PERSONALLY, I THINK THAT 5% WOULD BE APPROPRIATE FOR THOSE EMPLOYEES.

THAT'S WHAT I'M GOING TO BRING TO COUNCIL HERE ON THE BUDGET.

IF COUNCIL DOES NOT WANT TO SUPPORT THAT, I UNDERSTAND COMPLETELY, BUT I WHAT WERE THEY LAST YEAR? WHAT WAS THE COST OF LIVING ON 3%? 3%. 2%.

THREE. IT WAS THREE.

BUT I THINK, YOU KNOW, POLICE AND FIRE, THAT WAS THEIR BIG YEAR LAST YEAR.

THEY WERE SOME OF THOSE WERE BECAUSE WE DO IT BY RANK.

BUT SOME OF THOSE WERE TEN, 12%.

SO YEAH I JUST BUT YOU KNOW IT'S HARD.

AND I AGREE WITH THE MAYOR.

WE FOCUS VERY HEAVILY ON THE POLICE AND FIRE AND RIGHTLY SO BECAUSE WE HAVE RECRUITING ISSUES AND THINGS IN THOSE AREAS.

AND, AND IT'S VERY EASY TO, ESPECIALLY AMONGST CIVIL SERVICE DEPARTMENTS TO, TO PING PONG BACK AND FORTH.

BUT WE TYPICALLY OVERLOOK THE STRUGGLE THAT WE HAVE IN NOT JUST PUBLIC WORKS, BUT IN PARKS OF JUST KEEPING PEOPLE ON THE GROUND.

WE RUN HIGH, HIGH VACANCY RATES.

TRINO IS STILL HERE.

I MEAN, IT'S KILLING US.

AND RIGHT NOW YOU KNOW, GARBAGE IS PICKING UP BAGS AND TRINO'S GUYS HAVE BAGS UNDER THEIR EYES BECAUSE THEY'RE WORKING 16 HOURS A DAY.

THESE GUYS ARE EXHAUSTED, AND WE THOUGHT WE WERE GOING TO GET TO THROTTLE THEM BACK.

AND THEN TRINO AND I TALKED. I THINK WE'RE GOING BACK TO SIX DAY OPERATIONS.

SIX DAY OPERATION? YEAH.

UNTIL WE GET THE WEST END PUT IN GOOD SHAPE.

SO I'M NOT GOING TO ARGUE WITH THE MAYOR ON THAT.

THEY'VE BEEN WORKING REALLY HARD, NOT JUST REGULAR, BUT WITH THE STORM, YOU KNOW, COUPLE STORMS AND EVERYTHING, AND I AGREE WITH THE MERITS.

I THINK IT'S A. AND WE'VE CREATED A LEVEL OF SERVICE FOR OUR CITIZENS.

IT'S I MEAN, I'M GOING TO TELL YOU, I'VE BEEN DOING THIS FOR 30 YEARS.

THE LEVEL OF SERVICE WE PROVIDE, I KNOW A LOT OF CITIZENS WOULD ARGUE THIS.

WE PROVIDE A VERY HIGH LEVEL OF SERVICE.

AND I THINK OUR CITIZENS APPRECIATE THE WORK THESE GUYS DO.

YOU KNOW, THERE'S IT'S NOT, I THINK, AN INCENTIVE IT WOULD NOT BE JUST LIMITED TO EXTRA PAY, YOU KNOW, PERCENTAGE OF PAY.

BUT ALSO THERE'S I CAN'T REMEMBER WHAT TABLE THIS WAS IN, BUT THERE WAS A LIVING COST OF LIVING INCENTIVE IN HERE SOMEWHERE.

AND ACCORDING TO THIS TABLE, IT WAS IN HERE.

IT WAS BEING REDUCED OVER THE WELL.

THAT WAS SOMETHING WE DID MANY YEARS AGO.

IT WAS BEFORE I WAS CITY MANAGER ACTUALLY.

WE IMPLEMENTED A LOCAL SUBSIDY.

IF YOU LIVED ON THE ISLAND, YOU RECEIVED $2,500.

WE WHAT WE DID WAS, IS WE STOPPED OFFERING THAT TO NEW EMPLOYEES.

[01:45:03]

IT MOVED THE NEEDLE A LITTLE BIT.

IT MOVED IT MORE ON THE PUBLIC WORKS SIDE THAN IT DID ON THE POLICE AND FIRE SIDE.

I GUESS WHAT I'M SUGGESTING IS THAT THERE'S A LOT WE COULD DO, I THINK, IN PROVIDING WORKFORCE HOUSING HERE ON THE ISLAND, SOME BY SUBSIDIES AND SOME OTHER MEANS TO MAKE IT EASIER TO LIVE ON THE ISLAND AND FOR FIRST RESPONDERS AND EMPLOYEES.

I THINK THERE'S A LOT MORE WE COULD BE DOING IN THAT REGARD, YOU KNOW, TO REDUCE THE COST OF LIVING HERE, IF REDUCE THE COST OF GETTING INTO A HOUSE OR REDUCE THE TAXES PAID OR OTHER INCENTIVES TO HELP PEOPLE WHO WORK HERE, LIVE HERE, KEEP THEM HERE, KEEP THEM THERE.

ONE OF THE THINGS WE DID WHEN I WAS ON COUNCIL LAST, BECAUSE YOU HAVE TO LOOK AT THE FACT THAT EVERY TIME YOU'RE INCREASING COST OF LIVING OR WHATNOT, THEN IT IN AFFECTS THE PENSIONS.

THAT AFFECTS EVERYTHING ACROSS THE BOARD.

AND I THINK IT WAS A LEAN YEAR THOUGH YOU STILL HAD THE EFFECTS OF IKE.

SO WHAT WE DID IS WE DID LIKE A BONUS FOR EMPLOYEES WHO MADE LESS THAN A CERTAIN AMOUNT BECAUSE IT'S HER LOWEST PAID EMPLOYEES THAT REALLY SUFFER MOST.

AND I THINK IT WAS LIKE $1,000 OR SOMETHING THAT REALLY SCREWS UP YOUR PAY TABLES.

AND IT ALSO SCREWS US UP IN RECRUITING BECAUSE WE GIVE ONE TIME BONUSES AND THEN THAT PERSON LEAVES AND THEN I'VE GOT TO REPLACE THAT PERSON, AND I DON'T HAVE THE SALARY IN THAT SLOT TO REPLACE THEM.

THAT'S SOMETHING THAT A LOT OF CITIES ARE MOVING AWAY FROM THE ONE TIME INCENTIVES AND WORKED WELL THAT ONE YEAR IT DID IT THAT ONE YEAR THING THAT THEY WERE GOING THROUGH FOR A MAYOR. I WOULD SUPPORT YOU ON THAT, THAT 5%.

THANK YOU. THANK YOU.

VERY GOOD. I JUST WANT TO BRING THAT UP.

THANK YOU. COUNCIL.

OKAY. SO JUST FUTURE WISE ON THE 12TH, WE WILL ABSOLUTELY MEET AGAIN.

WE WILL HAVE A PUBLIC HEARING ON THIS BUDGET AS WELL AS THE TAX RATE, AND WE WILL PROPOSE TO HAVE THE BUDGET ADOPTED WITH THE PROPOSED TAX RATE THAT WE DISCUSSED TODAY OF 0.428382.

THIS WILL REQUIRE FOUR AFFIRMATIVE VOTES OF COUNCIL.

AND THEN ON THE 19TH IS WHEN WE WILL HAVE THE ADOPTION OF THE TAX RATE THAT WAS PROPOSED.

AND THAT REQUIRES FIVE AFFIRMATIVE VOTES FROM COUNCIL BECAUSE IT IS ABOVE THE NO NEW REVENUE RATE.

AND SO IF WE NEED ADDITIONAL MEETINGS IN BETWEEN, THEN THAT'S UP TO COUNCIL.

BUT THESE ARE THE ONES THAT ARE ON THE CALENDAR SO QUICKLY JUST TO GIVE THAT HOT TAX UPDATE THAT WAS REQUESTED AT THE LAST MEETING WE HAD IN JULY.

A HOT TAX, AS WE KNOW, IS TAX IMPOSED ON THE RENTAL OF A HOTEL ROOM.

AND AS YOU NOTED IT'S FOR A HOTEL ROOM.

THAT'S. WE TAKE A BREAK BEFORE THIS.

IT'S A MONTH. I'M FINE WITH THAT.

LET'S TAKE NO COUNCIL, WE NEED TO NEED TO STAY ON OUR TIMELINE.

HERE IS 1048.

LET'S TAKE A SEVEN MINUTE BREAK.

THAT WOULD PUT US BACK AT 1055.

OH, GOD. NO, I SAID 1055.

WE HAVE A [INAUDIBLE]. WE'RE BACK ON IT IS 10:57 A.M.

AGGRESSIVELY OVERRULED.

WE ARE BACK INTO SESSION AT OUR WORKSHOP.

I WANT TO SAY TO THE PUBLIC GLAD TO HAVE YOU AGAIN AND GET SETTLE IN BECAUSE WE'RE GETTING INTO READY TO TALK ABOUT HOT TAX.

AND THIS WILL BE AN INVIGORATING DISCUSSION COMING UP.

YES. AND IT'S HOT, HOT, HOT AND DANCING.

APPARENTLY. I DIDN'T SEE THAT.

ENTERTAINMENT IS COVERED.

SO, THIS PRESENTATION, THIS PART OF THE PRESENTATION WAS CREATED IN COORDINATION WITH THE CITY ATTORNEY'S OFFICE.

WE WORKED ON THIS EARLIER, AND THEN WE HAD THE HELP OF THE CITY INTERN, KATE BURCHFIELD.

AND HE WAS UNFORTUNATELY, HE'S NOT HERE ANYMORE TO SEE THIS, BUT IT'S HIS PRESENTATION.

SO WE NEEDED A KID TO DO IT.

YEAH, WELL, WE JUST NEEDED SOMEBODY WITH A LITTLE EXTRA TIME.

I MISS TATE. YEAH, HE WAS FANTASTIC.

SO THE HOT TAX IS A TAX IMPOSED ON RENTAL OF HOTEL ROOMS THAT ARE USED FOR LESS THAN 30 DAYS.

THIS WAS SIGNIFICANT.

AND THE DISCUSSION ABOUT SOME OF THESE SHORT TERM RENTALS BEING A LONGER RENTAL IN THE WINTER TIME, WHICH IS VERY INTERESTING.

THIS APPLIES TO SHORT TERM RENTALS AS WELL, AS LONG AS THE RENTAL IS BELOW 30 DAYS.

SO JUST FOR YOUR INFORMATION AND TO HAVE IT IN YOUR RECORDS, THE CODES THAT ARE RELATED TO HOT TAX ARE TAX CODE CHAPTER 351 AND 156, AS WELL AS THE CITY CHARTER AND THE CITY CODE OF ORDINANCES.

THE STATE ON THE STATE.

SO, WE HAVE LOCAL HOT TAX AND STATE HOT PACKS.

THE STATE COLLECTS 6% ACROSS THE BOARD ALL OVER THE STATE.

[01:50:02]

THE TEXAS TAX CODE, CHAPTER 351, ALLOWS THE CITY TO COLLECT 7% ON STATE ON STAYS WITHIN OUR COMMUNITY, AND THAT IS REFERRED TO AS CITY HOT.

OKAY. AND THEN WE HAVE A SPECIAL CATEGORY CALLED VENUE HOT.

AND THIS IS AN EXTRA 2% ON STAYS.

AND THIS IS RELATED TO THE CONVENTION CENTER.

THIS IS EVENTUALLY WHAT BECOMES FOR US PART OF THE TRICKLE DOWN OR THE CONVENTION CENTER SURPLUS.

AND IT'S ALSO REFERRED TO AS THE BRIMER BILL.

SO, IF YOU HEAR VENUE HOT OR BRIMER BILL, THIS IS THE EXTRA PORTION RELATED TO THE CONVENTION CENTER.

SO HOW ARE THESE FUNDS SPENT? OKAY, THE CITY AND THE VENUE HOT ARE SPENT IN THE FOLLOWING WAY.

WE HAVE A POINT 5% FOR BEACH CLEANING AND 0.5% FOR BEACH PATROL.

CULTURAL EVENTS ARE 0.875.

THE CONVENTION AND VISITORS BUREAU PREDOMINANTLY ADVERTISING AND MARKETING, IS THE A 3%, AND THAT'S IN THE CHARTER CONVENTION CENTER.

OPERATIONS FROM THE CITY'S PORTION IS THE 0.125%.

AND THEN THERE'S THE CONVENTION CENTER DEBT.

AND THIS INCLUDES THE BRIMER BILL.

SO IT'S THE 2% FROM THE CITY SIDE AND 2% FROM THE BREMER BILL.

SO JUST TO BE CLEAR, THOSE THREE CATALOG CATEGORIES RIGHT THERE, WE'RE GOING TO GO AWAY IN TEN YEARS.

SO YES.

SO WHAT'S GOING TO HAPPEN IS THE BRIMER BILL.

THAT 2% GOES AWAY ENTIRELY.

OKAY. AND THEN THE 2.125% THAT IS CURRENTLY DEDICATED TO OUR PORTION OF THE DEBT AND OPERATIONS WILL BE AVAILABLE FOR REALLOCATION.

IN THEORY, BECAUSE THE CITY HAS THE LEGAL RIGHT BY STATE LAW TO COLLECT 7% NO MATTER WHAT.

AND SO, PART OF THAT WILL PROBABLY CONTINUE TO GO FOR CONVENTION CENTER OPERATIONS.

OKAY. AND SO THAT'S I DON'T THINK THAT PERCENT IS DETERMINED WHAT IT WILL REQUIRE.

BUT IT IS A CITY ASSET.

IT'S CITY OWNED. RIGHT.

AND SO WE NEED TO BE ABLE TO SUPPORT OPERATIONS AND ONGOING CAPITAL RELATED TO THAT FACILITY.

BUT IT'S JUST THAT DEBT SERVICE THAT WOULD GO AWAY.

THE 2% DEBT SERVICE, THE BRIMER BILL IS WHAT GOES AWAY ENTIRELY.

CAN YOU DO THIS LINE FOR US AND SEND IT TO US WITH THE AMOUNT OF MONEY? YES. YEAH.

THANK YOU. ABSOLUTELY.

SO THE STATE'S CONTRIBUTION IS 2% AS WELL.

AND SO POINT 7% IS GOING TO BEACH CLEANING, 0.67 TO BEACH PATROL AND 0.57 TO BEACH RENOURISHMENT THE TOTAL COMBINED IS 11% BETWEEN THE LOCAL 9% AND THE 2% FROM THE STATE.

SO THIS I'VE PLUGGED IT IN HERE.

THIS IS ALSO THIS IS WHAT IS IN YOUR BUDGET BOOK ON PAGE SF 55.

BUT IT'S ANOTHER PRESENTATION TO KIND OF UNDERSTAND HOW IT ALL FLOWS ON THE FAR LEFT HAND SIDE.

THOSE ARE THE FUND NUMBERS.

SO WHEN YOU LOOK IN YOUR BUDGET, YOU'LL SEE THESE FUNDS ARE CITY FUNDS.

AND THIS IS WHERE THE CITY PORTION OF IT IS.

THE PORTIONS RELATED TO BEACH CLEANING, BEACH PATROL ADVERTISING ARE ALL GOING TO THE PARK BOARD, AND YOU WILL SEE THAT REFLECTED IN YOUR BUDGET AS WELL.

OKAY, SO THE DISTRIBUTION OF THESE HOT FUNDS FOR THE CITY ARE OUTLINED IN CHAPTER 33 OF OUR CODE OF ORDINANCES, AND THAT IS THE TAXATION PORTION OF THE CODE.

THIS ALSO DEFINES THE ORGANIZATIONS THAT CAN POTENTIALLY USE THESE HOT FUNDS, INCLUDING HISTORIC PRESERVATION, TOURIST MINDED ORGANIZATIONS, THAT SORT OF THING.

WOULD YOU MIND GOING BACK TO THE SLIDE BEFORE THIS, THE JUST TO CONFIRM THE 3% THAT IS GOING TO ADVERTISING AND TOURISM THAT IS DICTATED BY THE CHARTER.

THAT IS CORRECT. OKAY.

THE OTHER 3% THAT GOES TO THE PARK BOARD FOR BEACH PATROL, BEACH CLEANING AND ALL THAT THAT IS DICTATED BY LEGISLATION FROM THE STATE.

IS THAT CORRECT? SO MOST OF THAT IS RELATED TO THE SPECIFIC ALLOCATIONS IS SOME OF IT IS BY STATE LAW, SOME OF IT IS BY DEBT COVENANT RELATED TO THE CONVENTION CENTER DEBT ISSUANCE.

I REMEMBER DON MENTIONING THAT.

I ALSO NEED TO ADD THAT ALTHOUGH THE 3% IS IN THE CHARTER, THAT CHARTER PROVISION HAS BEEN ECLIPSED BY AN AMENDMENT TO TAX CODE 351 105 THAT SAYS IF YOU ASSESS HOT AT 7%, YOU MUST SEND 3% FOR ADVERTISING.

[01:55:07]

HOWEVER, IT'S GOING TO BE THE TAX CODE THAT PREVAILS.

GOOD TO KNOW.

AND JUST TO GO BACK.

THE 3% IS IN OUR CHARTER.

THE ONLY WAY THAT COULD BE CHANGED IS TO HAVE A CHARTER CHANGE.

WELL, I THINK WHAT DON JUST SAID WAS THAT 105 PROVIDES THAT IN THE EVENT IT CONFLICTS WITH A CHARTER PROVISION, THE PROVISIONS OF THE TAX CODE PREVAIL.

BUT YOU ARE CORRECT.

IF YOU WANTED TO INITIATE A CHANGE OF THE CHARTER, YOU WOULD HAVE TO SUBMIT IT TO THE VOTERS AND TELL THEM THIS IS TO BRING IT INTO COMPLIANCE WITH TEXAS STATE LAW. THE OTHER 3% TO BEACH CLEANING AND BEACH NOURISHMENT.

THAT IS, FOR THOSE FUNCTIONS.

IT'S NOT NECESSARILY PROGRAMED TO THE PARK BOARD.

THE CITY COULD DO THOSE IF NEED IF THEY CHOOSE TO FOR WHICH FUND BEACH CLEANING, BEACH CLEANING AND BEACH PATROL.

BUT RIGHT NOW WE'RE IN COMPLIANCE WITH THE STATE TAX CODE BECAUSE WE'RE SPENDING THREE OF THAT 7%.

CORRECT. RIGHT. WE ARE IN COMPLIANCE.

ACTUALLY, IT KIND OF MAKES YOUR CHARTER REDUNDANT, REDUNDANT OR NOT.

NOT NECESSARY. BUT YEAH.

YEAH. OKAY.

THANK YOU VERY MUCH. WHY WOULD IT MAKE IT REDUNDANT? AS THE STATE TAX CODE SAYS, WE HAVE TO SPEND 3% ON ADVERTISING.

OUR CHARTER IS JUST PARROTING THAT.

SO YOU BECAUSE IT'S STATE LAW, WE REALLY DON'T NEED IT IN OUR CHARTER.

BUT IT'S THERE.

IT'S ACTUALLY OPPOSITE BECAUSE THE CHARTER 3% HAPPENED FIRST.

CORRECT? CORRECT.

THAT WAS MY NEXT QUESTION FIRST.

YEAH. OKAY.

THANK YOU. YOU'RE WELCOME.

SO WHAT CAN IT BE USED FOR? SO AS MANY OF YOU KNOW, THIS IS A VERY RESTRICTED SOURCE OF REVENUE.

WE CAN'T JUST USE IT TO FUND OUR GENERAL FUND THERE.

IT BASICALLY WE CAN BREAK IT DOWN INTO TWO TYPES OF EXPENDITURES.

TOURISM, CONVENTION CENTER, HOTEL INDUSTRY.

AND THEN THERE ARE NINE STATUTORY CATEGORIES THAT ARE ALSO PERMISSIBLE UNDER CERTAIN CIRCUMSTANCES WHEN COMBINED WITH HEADS AND BEDS.

SO SOME OF IT HAS TO RELATE TO THE CONSTRUCTION OF CONVENTION CENTERS.

REGISTERING CONVENTION DELEGATES ADVERTISEMENTS TO ATTRACT TOURISTS AND DELEGATES TO CITIES.

THE ARTS.

HISTORICAL RESTORATION OR PRESERVATION.

SPORTING EVENTS.

ENHANCING SPORTING FACILITIES, TRANSPORTATION SYSTEMS FOR TOURISTS AND SIGNAGE DIRECTING THE PUBLIC TO FREQUENTLY VISITED ATTRACTIONS AND SIGHTS.

I THINK THE CITY HAS DONE AN ADMIRABLE JOB USING FUNDING FROM THE HOT SOURCE TO IMPACT IN ALL OF THESE AREAS, AND I THINK IT NEEDS TO BE ABSOLUTELY NOTED THAT EVERYTHING FROM THE TRANSPORTATION TO THE SIGNAGE, THESE ARE ALL THINGS THAT WE'RE TRYING TO LEVERAGE THESE FUNDS TO DO. AND AS I UNDERSTAND, THE LEGISLATURE IS TAKING UP TRYING TO EXPAND THE USE OF THAT TO INCLUDE INFRASTRUCTURE.

THAT'S INFRASTRUCTURE ISSUES THAT ARE IMPACTED BY TOURISM.

THAT WOULD BE LOVELY. I DON'T KNOW IF THAT'S TRUE OR NOT.

I THINK IT'S THE OPPOSITE.

THAT MAY IT MAY BE JUST THE OPPOSITE.

AND THEY'VE HAD SOME HEARINGS.

SALLY COULD BRING US UP TO DATE.

WE'VE HAD SOME PRELIMINARY HEARINGS AT THE STATE.

THERE'S OTHER CITIES IN THE STATE THAT ARE WANTING TO DO WHAT HAS BEEN MENTIONED ABOUT EXPANDING THE USE.

MARFA. MARFA IS ONE OF THEM.

THEY WENT BEFORE THE COMMITTEE AND SALLY GAVE A REPORT AND WAS NOT.

IT DIDN'T FALL ON VERY FRIENDLY EARS.

YEAH. SO WE'LL SEE HOW THAT PLAYS OUT.

IT'S BEEN ABOUT A YEAR, MAYBE MORE AGO.

BRIAN AND I MET WITH TEXAS HOTEL LODGING ASSOCIATION TO DISCUSS THE EXPANSION OF THE USE OF HOT AND THIS IS SOMETHING THAT I'VE.

I'VE WANTED TO WORK ON WITH SALLY.

RIGHT. BECAUSE THE THE MY ARGUMENT IS THAT 50% AND YOU'D HAVE TO IN STATE LEGISLATURE, YOU'D HAVE TO DO, YOU KNOW, A THRESHOLD AMOUNT BUT AND YOU COULD PROVE IT 50% COMES FROM SHORT TERM RENTALS.

BRIAN'S I'VE HEARD HIM A THOUSAND TIMES.

SAY THAT PUTS MORE OF A BURDEN ON OUR STREETS AND INFRASTRUCTURE.

SO, I MEAN, WE'RE NOT TALKING ABOUT HOTELS ON MAJOR THOROUGHFARES ANYMORE.

WE'RE TALKING ABOUT IN THE NEIGHBORHOODS.

RIGHT. THAT'S MOST OF MY POINT, REALLY, WAS THE IMPACT OF THIS TOURISM IS BEING FELT IN THE NEIGHBORHOODS AND THE INFRASTRUCTURE.

AND, YOU KNOW, AND EVEN WHEN IT'S RELATED TO SPORTING EVENTS, BECAUSE WE SHOULD HAVE THIS UNTIL GREEN TO OPEN UP.

[02:00:02]

BUT THE AFFECTED THE ARGUMENT THAT I WOULD USE WITH THE TEXAS HOTEL LODGING ASSOCIATION IS, YOU KNOW, THEY'RE BENEFITING THAT 50% FROM THE HOT TAX THAT'S NOT PRODUCED BY YOU KNOW, AND I KNOW THEY'RE TRYING TO BRING IN SOME OF THE STRS INTO THEIR INDUSTRY, BUT IT'S A DIFFERENT I MEAN, YOU'RE COMPARING, YOU KNOW, A LARGE SCALE DEVELOPMENT, YOU KNOW, WITH ROOMS VERSUS, YOU KNOW, SCATTERED SITE WITH ITS OWN INFRASTRUCTURE AND EVERYTHING.

EXACTLY. YEAH. WELL, AND TO WHAT YOU'RE SAYING, WHEN YOU LOOK AT SHORT TERM RENTALS, I MEAN, BECAUSE WE HAVE BOTH HOTELS AND SHORT TERM RENTALS IN MY DISTRICT, WE ALSO HAVE A HIGHER ROOM RATE PER NIGHT.

SO I'M GOING TO SEND A REQUEST OR WILL YOU SEND A REQUEST? I'D LIKE TO SEE THE BREAKDOWN OF HOT TAX PER DISTRICT.

YOU KNOW, I'M NOT SO SURE THAT DISTRICT LINES ARE APPLICABLE BECAUSE THOSE ARE REALLY RELATED TO VOTING, YOU KNOW, AND THE WAY THAT THAT THE STARS ARE KIND OF ARRANGED THEMSELVES MAY OR MAY NOT BE ACCORDING TO THE DISTRICT, SO MUCH AS TYPICAL USE.

FOR INSTANCE, IN THE EAST END, IT'S, YOU KNOW, WE'RE VERY DENSELY PUT TOGETHER THERE AND IT HAS A DIFFERENT IMPACT THAN IT DOES, SAY, ON THE WEST END WHERE LIKE YOU SAID, WELL, THE HOUSES ARE FURTHER APART.

THEY, THEY GENERATE A HIGHER A HIGHER PER NIGHT DOLLAR AMOUNT.

AND IT HAS THERE'S WHERE THE MAJORITY IS.

SO I'M NOT SURE DISTRICT LINES ARE REALLY THE WAY TO DIVIDE IT UP AS MUCH AS CHARACTER AREAS LIKE WE DO IN SOME OTHER THINGS.

WELL, BUT WHEN YOU LOOK AT THE PARK BOARD BROKE IT DOWN AND THEY DID THIS FOR 20.

IT WAS 22, 23 AND 24 BY DISTRICT.

SO, WE ALREADY KIND OF HAVE THE BY DISTRICT.

BUT I WOULD, YOU KNOW, I MEAN BY DISTRICT, YOU KNOW, I THINK THE ARGUMENT THERE IS OKAY.

WELL, YOU KNOW, IN MY DISTRICT, YOU KNOW, I GOT 208 YOURS IS 210.

DISTRICT TWO IS SECOND HIGHEST.

EIGHT, 850.

AND, YOU KNOW, I MEAN, WE DON'T NEED THAT'S ALL INTERESTING, BUT IT REALLY DOESN'T ADDRESS THE IMPACT ON THE DIFFERENT CHARACTER TYPES OF THE NEIGHBORHOODS, BECAUSE THE NEIGHBORHOODS HAVE ARE VERY DIFFERENT.

THE EAST END IS COMPLETELY DIFFERENT FROM THE WEST END.

SO THE IMPACT IS GOING TO BE A LITTLE DIFFERENT.

AND I THINK ADDRESSING IT BY CHARACTER OF THE NEIGHBORHOODS GETS A LITTLE CLOSER TO ALIGNING THE IMPACT ON THE NEIGHBORHOODS.

AND YOU HAVE TO LOOK AT CONGESTION BECAUSE THE THERE IS A DIFFERENT CHARACTER.

HENCE, YOU KNOW, I'LL GO BACK TO WHY WE NEED TO INCREASE THE LOT SIZE.

MINIMUM LOT SIZE TIES INTO THAT, ESPECIALLY IN YOUR AREA.

BUT IF YOU LOOK AT A NEIGHBORHOOD LIKE PIRATES BEACH, YOU MIGHT HAVE 60% THAT ARE NOW SHORT TERM .RENTAL COUNCIL LET ME JUST MENTION THIS.

WE'RE KIND OF GETTING OFF TOPIC ON THIS PARTICULAR.

COUNCIL IS MENTIONED, THOUGH, ABOUT HAVING A SPECIAL MEETING TO MAYBE DISCUSS THIS TYPE OF THING, AND I'M THINKING ABOUT A SPECIAL MEETING.

THEN IT'S BEEN MENTIONED AND INCLUDE INTO THAT THE REVIEW OF THE PARK BOARD'S BUDGET.

SO WE MIGHT COULD GET INTO THIS.

WE'LL GET WITH JANELLE.

AND LET'S SEE ABOUT SETTING UP A SPECIAL MEETING TO DISCUSS THIS.

I HAVE A SPECIAL MEETING THAT SHOULD INCLUDE PARK BOARD.

YEAH. YEAH. SURELY, SURELY I COULD CLOSE THE LOOP.

YOU KNOW, ALL OF THOSE ARE EXCELLENT OBSERVATIONS.

HOWEVER IN TERMS OF THE EXPANDING THE USE OF HOT THE HOTEL LODGING ASSOCIATION FOR THE STATE HAS BEEN EXTREMELY SUCCESSFUL IN INFLUENCING THE LEGISLATURE TO THE EXTENT THAT THEY HAVE INTERJECTED THE PROVISION THAT HOT MUST PRODUCE HEADS AND BEDS, EVEN THOUGH IT IS NOT IN THE STATUTE. IT HAS BEEN INCORPORATED INTO STATE LAW THROUGH A AG OPINION ISSUED BY GOVERNOR ABBOTT.

SO IF YOU WANT TO EXPAND THE USE OF HOT.

I THINK THE MAYOR WAS ABOUT TO SAY BRIAN AND HE HAD A MEETING WITH THE HOTEL LODGING PEOPLE, AND THEY'RE A LITTLE PROPRIETARY OVER THESE FUNDS.

THEY ARE, BUT THEY'RE OURS.

BUT TO YOUR POINT TO HEADS AND BEDS, THE CONDITIONS OF PEOPLE DRIVING TO PUT THEIR HEADS IN BEDS IS, YOU KNOW, IF THINGS KEEP DETERIORATING OR IF THINGS ARE FULL OF

[02:05:01]

I DO NOT DISAGREE.

NO, NO, YOU'RE EXACTLY RIGHT.

THIS IS A DISCUSSION, THOUGH.

WHO CAN ARGUE BETTER? WELL, THE.

BY THE WAY, THE EXECUTIVE DIRECTOR OF THE TEXAS HOTEL LODGING ASSOCIATION, WHEN HE WORKED FOR THE ATTORNEY GENERAL'S OFFICE, WROTE THE HOT TAX LAW.

RIGHT. SO, HE KNOWS IT REAL WELL.

AND HE'S A FRIEND TO GALVESTON.

I'M I'VE WE'VE WORKED WITH HIM FOR A LONG TIME AND THEY JUST HAVE SOMETIMES A DIFFERENT PERSPECTIVE.

THIS IS SOMETHING THAT WE NEED TO DISCUSS WHEN THE LEGISLATIVE AGENDA COMES FORWARD THAT SALLY BRINGS TO US.

BUT LET'S GET THAT ON ANOTHER MEETING SO WE CAN REALLY DELVE INTO THIS, AND WE'LL CONSIDER THAT AT A SPECIAL MEETING.

I WOULD APPRECIATE YOU PUTTING SOMETHING SIMILAR TO THAT SO WE CAN GET PREPARED FOR THE LEGISLATIVE.

YEP I AGREE. SO I'M GOING TO KIND OF SKIP OVER THESE OTHER USES THERE IN YOUR PACKET.

IF YOU LOOK AT THE WAY HOT FUNDS ARE ALLOCATED IN GALVESTON, YOU'LL SEE THAT THE ALLOCATIONS GO PARTIALLY TO THE CITY, PARTIALLY TO THE PARK BOARD, TO VARIOUS ARTS AND HISTORIC ORGANIZATIONS, AS WELL AS PUBLIC ART PROJECTS IN ORDER TO RECEIVE HOT FUNDS FROM THE CITY.

SPECIFICALLY, AN ENTITY MUST HAVE A BUDGET APPROVED IN WRITING BY THE CITY.

THEY MUST PROVIDE QUARTERLY REPORTING ON THEIR EXPENDITURES TO THE CITY.

THEY HAVE TO STORE HOT FUNDS SEPARATED FROM OTHER FUNDING SOURCES, SO THEY'RE NOT CO-MINGLING.

THAT RESTRICTED FUNDING WITH OTHER FUNDING.

AND THEY MUST HAVE A WRITTEN THERE MUST BE A WRITTEN CONTRACT BETWEEN THE CITY AND THE ENTITY RECEIVING THE FUNDS.

THE CITY EXPENDS 4.125% OF HOT, AS WE SAW FOR THE CONVENTION CENTER BONDS AND OPERATIONS THAT IS SPLIT BETWEEN LANDRY'S CORPORATION AND THE CITY, AND WHAT IS REMAINING AFTER THOSE OBLIGATIONS ARE MET EACH YEAR IS WHAT GOES INTO THAT CONVENTION CENTER SURPLUS FUND.

OKAY, ANYTHING IN THE CONVENTION CENTER SURPLUS FUND IS STILL RESTRICTED IN USE AS A HOT FUND.

OKAY. AND THAT'S MY HIGH LEVEL OVERVIEW OF HOT FUNDS.

AND I'M HAPPY TO ANSWER ADDITIONAL QUESTIONS.

I JUST WANTED TO PROVIDE A LITTLE BIT OF CONTEXT FOR AND FOR AND FOR TRANSPARENCY SAKE.

IT'S BEEN JUST VERY INFORMAL, BUT THE WHARFS BOARD HAS DISCUSSED THE USE OF HOT FOR CRUISE TERMINALS.

WELL, THERE AT THE PORT.

SO THAT HOT AND THAT IS ALLOWED IN THE STATE REGULATIONS FOR CRUISE TERMINALS.

BUT THEY HAVE SO MANY OTHER WAYS TO FUND THOSE THINGS.

OH, THERE'S NO DOUBT.

I'M JUST SAYING HOT IS A TOPIC THAT YOU WERE GOING TO SAY HOT IS A HOT TOPIC.

I KNOW I STARTED BRIAN TO THE PUNCH.

HOT HOT HOT.

I'M TOO COLD RIGHT NOW TO ANSWER.

THANK YOU, CSILLA, VERY MUCH.

ANY FURTHER DISCUSSION OF THE BUDGET OR ANYTHING FOR MISS LUDANYI? I'M SURE WE WILL AT OUR NEXT MEETING SINCE WE JUST RECEIVED IT.

IT'S 11:17 A.M..

WE ARE NOW GOING TO RETIRE TO THE COUNCIL CHAMBERS TO CONTINUE OUR MEETING.

I JUST WANT TO SAY THANK YOU.

THIS WAS THOROUGH. I HAD A COMPLETE UNDERSTANDING.

AND I WILL HAVE QUESTIONS.

OKAY, GOOD. CSILLA DOES A FANTASTIC I WAS GETTING.

YOU'RE SUPERB CSILLA, HOW IMPRESSED PEOPLE ARE WITH CSILLA.

SO THIS IS. AND I'M EXTREMELY PROUD OF EVERYBODY GETTING HER NAME RIGHT NOW.

I KNOW I'M EXCITED ABOUT THAT PART TOO.

SO WE CALL OUR SIX DIFFERENT NAMES IN ONE MEETING.

YOU KNOW WHAT CSILLA DOES WELL TO COUNCIL IS NOT ONLY WHAT YOU'VE SEEN BEFORE YOU TODAY, BUT SHE'S THE FACE FOR THE CITY WITH THE PARK BOARD AND OTHER ENTITIES, AND SHE DOES A VERY GOOD JOB WITH THAT.

SO I'M REALLY THIS IS NOT MY WORK.

SO I HAVE A REALLY GREAT TEAM OF PEOPLE UPSTAIRS.

HER TEAM IS FANTASTIC.

THEY ARE EVERYONE.

SO YES. COULDN'T DO IT WITHOUT THEM.

ALL RIGHT, LET'S RETIRE TO THE COUNCIL CHAMBERS AND WE'LL CONTINUE THIS FUN AND THAT WE HAVE RIGHT NOW.

SO. GOOD MORNING EVERYONE.

IT IS 11:22 A.M..

WE ARE NOW INTO REGULAR SESSION OF OUR CITY COUNCIL MEETING FOR AUGUST 8TH.

LET'S MOVE TO ITEM FOUR, PLEASE, MA'AM.

ITEM FOUR, PUBLIC COMMENT ON AGENDA ITEMS. IS THERE ANYONE THAT WOULD LIKE TO MAKE A COMMENT ON AGENDA ITEMS? HEARING NO RESPONSE, WE WILL MOVE FORWARD.

LET'S MOVE TO OUR ACTION ITEMS.

[5.A. Consider A Motion To Call A Public Hearing On September 12, 2024 On The FY 2025 Proposed Budget As Required By State Law. (C. Ludanyi)]

ITEM FIVE A CONSIDER A MOTION TO CALL A PUBLIC HEARING ON SEPTEMBER 12TH, 2024 ON THE FY 2025 PROPOSED BUDGET AS REQUIRED BY STATE

[02:10:02]

SO WE ARE LEGALLY REQUIRED TO HAVE A PUBLIC HEARING ON THE BUDGET BEFORE WE APPROVE IT.

AND THIS WILL SIMPLY ALLOW YOU TO CALL THAT PUBLIC HEARING FOR SEPTEMBER 12TH BEFORE THE BUDGET ADOPTION.

I WOULD ENTERTAIN, FIRST OF ALL, ANY QUESTIONS FOR MISS LUDANYI? I WOULD ENTERTAIN A MOTION COUNCIL.

I'LL MOVE TO APPROVE MOTION.

I'LL SECOND THAT. PUBLIC HEARING ON STAFF ON THE BUDGET STAFF REPORT.

ALL RIGHT. WE HAVE A MOTION OF APPROVAL BY COUNCIL MEMBER BROWN AND A SECOND BY COUNCIL MEMBER LEWIS FOR.

THAT ANY DISCUSSIONS? ALL THOSE IN FAVOR, PLEASE CAST YOUR VOTE.

CAN YOU PUT YOUR SECOND.

OH A SECOND. OH, OKAY.

YEAH. YOU'RE THERE.

THANKS. THAT IS.

HE'S NOT HERE.

RIGHT? IT IS UNANIMOUSLY APPROVED BY ALL THOSE THAT ARE PRESENT.

THANK YOU. LET'S MOVE TO ITEM FIVE B, PLEASE.

[5.B. Consider A Motion To Propose A Property Tax Rate Of $0.428382 Per $100 Of Taxable Value For Tax Year 2024 And Call A Public Hearing On September 12, 2024.]

AND WE HAVE MISS LUDANYI.

CSILLA, IF YOU WOULDN'T MIND, MAYBE CLARIFY FOR THE PUBLIC WHAT THIS IS.

SO, IN ADOPTING THE TAX RATE, THE COUNCIL HAS TO TAKE THREE ACTIONS IN THAT PROCESS.

THE FIRST IS TO NOTICE THE PUBLIC ABOUT THE TAX RATE THAT HAS BEEN PROPOSED.

AND THAT IS WHAT IS BEING DONE HERE TODAY IS COUNCIL IS SELECTING A TAX RATE TO NOTICE THE PUBLIC.

THIS IS THE HIGHEST TAX RATE THAT THE COUNCIL CAN CHOOSE TO APPROVE DURING THE PROCESS.

YOU CANNOT GO HIGHER THAN WHAT YOU ARE NOTICING.

AT THE FOLLOWING MEETING YOU WILL.

WHEN YOU ADOPT THE BUDGET, YOU WILL RATIFY THE TAX RATE THAT IS SELECTED TO SUPPORT THE BUDGET.

AND THEN FINALLY, ON SEPTEMBER 19TH, YOU WILL ACTUALLY VOTE TO ADOPT FORMALLY A TAX RATE.

SO THIS PART ALLOWS US TO NOTICE THE PUBLIC.

VERY GOOD. ANY QUESTIONS FOR MISS LUDANYI? VERY GOOD. I WOULD ENTERTAIN A MOTION LIKE A MOTION TO APPROVE.

I'LL SECOND. WE HAVE A MOTION FOR APPROVAL OF ITEM FIVE B BY COUNCIL MEMBER PERRETTA AND SECONDED BY COUNCIL MEMBER ROLLINS.

ANY DISCUSSION? COUNCIL? WELL, YES, I HAVE TO SAY, I'M NOT COMFORTABLE WITH PROVING THIS RATE AT THIS MOMENT WITH RISK JUST RECEIVING OUR BUDGET BOOKS.

AND EVEN THOUGH I KNOW IT'S JUST SAYING IT'S THE HIGHEST IT CAN BE.

I PERSONALLY WOULD LIKE TO DO FURTHER REVIEW OF OUR BUDGET BOOK.

JUST MY PERSONAL OPINION.

WOULD YOU KIND OF WALK US? THANK YOU MARIE. WOULD YOU WALK US THROUGH THE TIMELINE ON THIS? CSILLA. SO IN ORDER FOR US TO CONSIDER APPROVING A TAX RATE AT ANY POINT, YOU HAVE TO HAVE IT PUBLISHED AND NOTICED FOR A PERIOD OF TIME BEFORE YOU CAN HAVE THAT PUBLIC HEARING AND ADOPT.

SO I HAVE NOT WORKED OUT WHAT THE LAST TIME THAT COUNCIL CAN PROPOSE A TAX RATE IS IN ORDER TO MEET THOSE OTHER OBLIGATIONS WE HAVE, BUT AT SOME POINT IT HAS TO BE NOTICED AND WE ARE LIMITED IN TIME, IN OUR APPROVAL OR ABILITY TO APPROVE A TAX RATE.

AFTER THAT NOTICE TAKES PLACE.

I THINK IT'S BETWEEN 10 AND 30 DAYS, IF I RECALL CORRECTLY.

BUT THAT PUBLIC HEARING HAS TO HAPPEN IN A TIMELY MANNER AFTER THAT NOTICE IS IN THE PAPER.

I HAVE A QUESTION.

YES, MA'AM.

LET ME MAKE SURE THAT I'M CLEAR WHAT WE'RE VOTING ON IS A RATE THAT WE CANNOT GO HIGHER THAN.

THAT IS CORRECT. THAT IS WHAT WE'RE VOTING ON, NOT THE SUGGESTED RATE.

THAT IS CORRECT. SO THE RATE THAT YOU GAVE US IS THE HIGHEST CORRECT THAT WE CAN DO SUGGESTED.

CORRECT. IT IS WHAT THE BUDGET IS CURRENTLY PROPOSED AT.

SO THE REVENUE IN THE BUDGET REFLECTS THIS RATE.

BUT REGARDLESS OF HOW THE BUDGET MAY CHANGE OR NOT CHANGE IN THAT TIME, COUNCIL HAS THE ABILITY TO REVIEW THE TAX RATE AND THEN RATIFY ONE AND PROPOSE ONE OR AND ADOPT ONE AT THE SEPTEMBER 19TH MEETING.

RATIFY MEANS TO CHANGE MY.

SO AS PART OF THE BUDGET PROCESS, YOU HAVE TO RATIFY THAT.

YOU ACKNOWLEDGE THAT THE BUDGET YOU'RE APPROVING IS TIED TO THAT SPECIFIC TAX RATE.

THAT'S WHAT WILL HAPPEN ON THE 12TH.

[02:15:03]

WE HAVE TO SET A TAX RATE BY SEPTEMBER 30TH.

CORRECT. AND YOU'RE SAYING WE HAVE TO PUBLISH IT 30 DAYS PRIOR TO THAT.

SO I BELIEVE FROM THE TIME YOU NOTICE, YOU CANNOT HAVE THE PUBLIC HEARING OUTSIDE OF THAT 30 DAY MARK.

SO YOUR ACTION HAS TO BE TIMELY IN RELATION TO THE NOTICE.

SO THE PUBLIC WILL GIVE COMMENT.

THEY HAVE THE OPPORTUNITY.

ABSOLUTELY. BY THE 19TH WE CAN CHOOSE TO NO NO NEW REVENUE.

WE CAN KEEP IT BUT WE CAN'T EXCEED THE 4.83, YOU KNOW.

CORRECT. CORRECT.

VERY GOOD.

ALL RIGHT. ANY FURTHER DISCUSSION COUNCIL? ALL THOSE IN FAVOR OF ESTABLISHING AT THIS POINT, THE MAXIMUM RATE.

THAT IS APPROVED BY COUNCILMAN ROLLINS, PERRETTA BROWN AND BROWN, AND LEWIS AND COUNCILWOMAN ROBB VOTES AGAINST.

IT DOES PASS.

VERY GOOD. LET'S NOW WE ARE NOW AT 11:29 A.M..

WE ARE THROUGH WITH OUR REGULAR SESSION AGENDA, AND COUNCIL WILL BE RETIRING IN THE NEXT FIVE MINUTES OR SO INTO EXECUTIVE SESSION IN

[6. EXECUTIVE SESSION (Room 204)]

WE ARE ADJOURNED WITH THE REGULAR MEETING.

YES, MA'AM. GO RIGHT AHEAD.

PURSUANT TO TEXAS GOVERNMENT CODE SECTION 551.074, PERSONNEL MATTERS TO DELIBERATE THE APPOINTMENT, EMPLOYMENT, EVALUATION, REASSIGNMENT, OR DUTIES OF A PUBLIC OFFICER OR EMPLOYEE.

CITY COUNCIL APPOINTEE EVALUATION.

CITY MANAGER BRIAN MAXWELL, CITY ATTORNEY DON GLYWASKY, AND CITY SECRETARY JANELLE WILLIAMS. THANK YOU VERY MUCH.

ALL RIGHT COUNCIL.

COUNCIL WE ARE, IT IS NOW 12 NOON ON AUGUST 8TH.

WE ARE OUT OF EXECUTIVE SESSION.

AND I'M GOING TO MAKE A MOTION THAT WE RESCHEDULE OUR EVALUATION OF OUR EMPLOYEES THAT WERE SCHEDULED TODAY.

THAT WAS TO SCHEDULED FOR TODAY TO SEPTEMBER 4TH.

AND WE WILL CONDUCT OUR INTERVIEWS AND EVALUATIONS AT THAT TIME.

I'LL SECOND THAT MOTION.

WE HAVE A SECOND FOR THAT MOTION.

ANY DISCUSSION? I MEAN, ALL THOSE SIGNIFY BY RAISING YOUR HAND.

IF THOSE IN FAVOR. THAT IS UNANIMOUS.

WE HAVE GONE THROUGH ALL THE ITEMS ON OUR AGENDA FOR TODAY, AUGUST 8TH.

WE ARE ADJOURNED.

THANK YOU EVERYONE.

* This transcript was compiled from uncorrected Closed Captioning.