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[1. Call to Order of the Edmond City Council Meeting.]
I WOULD LIKE TO CALL OUR SPECIAL MEETING FOR THE EDMOND CITY COUNCIL, UH, OUR 20 25 20 26 BUDGET KICKOFF WORKSHOP TO ORDER.[2. Presentation and Discussion of Economic Outlook, Fiscal Year 2025-26 Budget Process, and Budget Projections.]
WE'RE GONNA PRESENTATION AND DISCUSSION OF THE ECONOMIC OUTLOOK FISCAL YEAR, 20 25, 26 BUDGET PROCESS, AND THE BUDGET PROJECTIONS.THAT'S WHAT WE'LL BE TALKING ABOUT TODAY.
GOOD AFTERNOON, MAYOR AND COUNCIL.
ALRIGHT, I THINK WE'RE READY NOW.
AND DO YOU NICE TO SEE EVERYBODY HERE TODAY.
SO WE ARE, UM, THIS IS OUR FIRST BUDGET HEARING, OR NOT HEARING, BUT KICKOFF OUR WORKSHOP FOR OUR WORKSHOP SERIES.
AND, UM, SO WE'LL BE PROVIDING AN ECONOMIC OUTLOOK TODAY.
WE'LL HAVE DR. EVANS COME UP AND SPEAK AND TO, UH, FEDERAL TRENDS, STATE TRENDS, AND LOCAL TRENDS.
AND, UH, SO ANY, ANYWHERE ALONG THE WAY, PLEASE, UH, FEEL FREE TO ASK QUESTIONS.
AND WE'LL ALSO HAVE SOME QUESTIONS AT THE END, BUT WE'LL GO AHEAD AND GET STARTED.
SO, UM, WELL, I JUST SAID IT, BUT WE'RE GONNA HAVE AN ECONOMIC OVERVIEW TODAY.
UH, WE'RE STILL IN THE MIDST OF ACTUALLY PUTTING OUR BUDGET BOOK REALLY TOGETHER AND FINISHING UP ALL THE ALLOCATIONS, THAT KIND OF THING.
SO, UM, THIS IS MORE LOOKING FORWARD AND TO GET INPUT FROM YOU GUYS IF THERE'S ANYTHING THAT YOU REALLY WANT US TO FOCUS ON THIS YEAR OR LOOK INTO.
UM, AND SO THEN, AND WE WILL JUST GIVE YOU AN OVERVIEW OF WHERE WE ARE RIGHT NOW.
SO OUR WORKSHOPS ARE SCHEDULED TODAY IS OUR KICKOFF.
UM, AND WE'RE GOING TO HAVE FOUR, INCLUDING THIS ONE, FOUR WORKSHOPS, AND THEN WE'LL HAVE THE HEARING IN MAY.
SO WE'LL HAVE, UH, THE PUBLIC SAFETY BUDGETS ON MARCH 24TH, UH, EPWA, UTILITY BUDGETS ON APRIL 14TH, AND THE NON-UTILITY CAPITAL BUDGETS AND GENERAL FUND, AND OUR CARC RECOMMENDATIONS ON APRIL 28TH.
AND THEN IN BETWEEN THERE, IF THERE'S ANY CHANGES OR UPDATES THAT YOU WOULD LIKE TO SEE, WE WILL INCORPORATE THOSE, UH, INTO OUR PUBLIC HEARING ON MAY 12TH.
UH, RUSSELL EVANS IS WITH US TODAY.
HE'S WITH THE REGION REGIONAL ECONOMIC ADVISORS, AND ALSO THE THORNBURG COLLECTOR.
AND HE IS A WELL-KNOWN ECONOMIST THAT SERVES CLIENTS ACROSS THE COUNTRY.
AND, UH, ALSO OKLAHOMA CITY, AND I BELIEVE NORMAN HOUSTON.
BUT HE'S, UH, VERY WELL VERSED IN ALL THE ECONOMIC TRENDS, AND THAT'S WHAT HE DOES EVERY DAY, DAY IN AND DAY OUT.
SO WE'RE HAPPY TO HAVE HIM HERE TODAY.
UM, SO I WILL TURN IT OVER TO HIM, AND THEN I'LL COME BACK A LITTLE BIT LATER.
KATHY, I HAVE ONE QUICK QUESTION.
IN OUR PROCESSES THAT WE'RE USING THIS YEAR, ARE THERE ANY MAJOR SIGNIFICANT CHANGES FROM ANY OF THE PREVIOUS YEARS THAT THE COUNCIL MIGHT NEED TO KNOW ABOUT BEFORE WE GO FORWARD? THAT WE HAVE REVERTED BACK TO WHERE ALL THE DEPARTMENTS HAVE ENTERED THEIR BUDGETS THIS YEAR? RIGHT NOW, WE HAVE MET WITH EVERY DEPARTMENT, THE BUDGET REVIEW COMMITTEE.
IT IS, UM, RANDY, SO OUR CITY MANAGER, ASSISTANT CITY MANAGER, HR DIRECTOR, I'M THERE.
AND THEN OUR BUDGET ANALYST IS THERE AS WELL.
AND THEN WE SOMETIMES HAD SOME OTHER STAFF MEMBERS COME IN JUST TO HELP WITH SOME QUESTIONS.
BUT WE HAVE BEEN THROUGH IT ALL.
UM, LAST YEAR IT WAS ALL ENTERED BY FINANCE, AND THIS YEAR IT'S ENTERED BY THE DEPARTMENTS.
SO WE WANTED TO REALLY GIVE OWNERSHIP BACK TO THE PARK DEPARTMENTS AND BE ABLE TO DISCUSS AND SO THAT EVERYBODY KNOWS WHAT'S IN THEIR BUDGET AS WE GO FORWARD, WHAT, WHAT ARE PLANS GONNA BE TOO IS WE'RE COMPILING ALL OF THIS.
EVERYBODY, LIKE I SAID, ENTERED THEIR OWN.
SO WE'RE UPDATING ALL THE ALLOCATIONS AND THINGS THAT ARE CITYWIDE.
AND THEN ONCE WE GET EVERYTHING REALLY TIED DOWN, WHICH WOULD PROBABLY BE, UM, YOU KNOW, IN THE NEXT COUPLE WEEKS, THEN WE'LL LOOK, LOOK AT OUR OVERALL BUDGET, WHERE WE'RE STANDING, WHAT OUR UNRESTRICTED RESERVES ARE, AND THAT KIND OF THING.
AND THEN WE'LL EVALUATE, OOH, DO WE NEED TO CUT? CAN WE ADD MORE? WHATEVER WE'RE GONNA HAVE TO DO.
BUT, UM, THIS YEAR WE'VE STARTED SO MUCH EARLIER, IT'S, IT'S VERY GOOD BECAUSE WE HAVE BEEN ABLE TO GET THE BASE IN THERE, AND THEN WE WILL HAVE TIME AS COUNSEL AND STAFF TO LOOK AT IT AND REALLY QUESTION THINGS AND SAY, WELL, CAN WE THINK ABOUT THIS OR THAT? SO I'D SAY THAT'S A MAJOR CHANGE FROM LAST YEAR.
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ENTERED BY THE DEPARTMENTS AND, UM, AND WE DIDN'T DO THAT LAST YEAR, BUT, BUT WE DID THIS YEAR, SO.IT'S A, IT'S, I ENJOY, UH, OPPORTUNITIES TO, TO BE BACK AND TALK A LITTLE BIT ABOUT WHAT IS HAPPENING IN THE REGIONAL ECONOMY.
UH, AND AGAIN, EVERYTHING THAT WE'LL SORT OF TALK, TRY TO TALK ABOUT TODAY, JUST TRY TO DO IT IN THAT, THAT BROAD PICTURE OF, UH, SETTING STAGE FOR REALLY CONSIDERING BUDGETS AND WHAT ABOUT TRENDS? WHAT DO WE SEE HAPPENING IN THE ECONOMY SPECIFIC TO REALLY SELL SOME USE TAX COLLECTIONS HERE IN THE OKLAHOMA CITY AREA.
SO WE'LL START WITH THE BROAD PERSPECTIVE, BUT REALLY EVERYTHING IS, IS KIND OF TAILORED TO MOVE US, UH, IN THAT DIRECTION.
AND WE'LL KIND OF FOLLOW THIS OUTLINE A LITTLE BIT.
VERY HIGH LEVEL THIS, AS WE WENT THROUGH 2024, WHAT WAS HAPPENING IN THE LABOR MARKET AND THE GOODS MARKET AND CAPITAL MARKETS, KIND OF WHAT, WHAT'S HAPPENING A LITTLE CLOSER TO YOUR HOME IN THE OKLAHOMA CITY BACKYARD.
AND THEN WHAT'S HAPPENING RIGHT HERE WITH, UH, INSIGHT EVAN WITH SOME POPULATION DEMOGRAPHICS, MOVEMENTS IN SALES AND USE TAX, UH, PROJECTIONS.
UM, BUT AGAIN, THE IDEA IS JUST TO SET THE STAGE ON SORT OF WHERE WE, AT THE CONTEXT AGAINST WHICH HOUSEHOLDS ARE GONNA BE MAKING PURCHASE DECISIONS.
AND BY EXTENSION, THE CONTEXT AGAINST WHICH YOUR, YOUR FUTURE TAX COLLECTIONS ARE GONNA BE DETERMINED.
SO THE FIRST THING TO NOTE, I THINK THIS IS THAT THE NATIONAL LABOR MARKET IS ROUGHLY IMBALANCED.
AND SO THE FEDERAL RESERVE, UH, WENT THROUGH A PROCESS OF RAISING INTEREST RATES, UH, REALLY TRYING TO CONSTRAIN SOME INFLATIONARY FORCES.
ONE OF THE IMPACTS OF THAT IS TO BRING THE LABOR MARKET BACK INTO BALANCE, WHERE WE HAVE ABOUT ONE UNEMPLOYED PERSON FOR EVERY ONE JOB POSTING.
THIS HAS ALLOWED US TO GET RID OF SOME OF THE INFLATIONARY PRESSURES OF WAGES BEING BID HIGHER WITHOUT DRIVING THE UNEMPLOYMENT RATE HIGHER.
SO WE REALLY HAVEN'T SEEN UNEMPLOYMENT RATES GO UP, UH, CONSIDERABLY, BUT WE HAVE SEEN THAT EXCESS DEMAND FOR LABOR COME OUT OF THE MARKET.
AND SO LABOR MARKETS ARE HEALTHY, BUT THERE'S NO EXAGGERATED HEALTH ANYMORE.
CONSUMERS ARE, UH, YOU KNOW, WHAT WE WOULD DESCRIBE CONSUMERS AS, UH, STRETCHED, UH, THEY, THEY'VE STRETCHED THEIR USAGE OF AND ACCESS TO CREDIT.
AND SO WHEN YOU LOOK INSIDE CONSUMER DEBT MARKETS, UH, CONSUMER LOANS AND CREDIT CARDS ARE BEING CHARGED OFF AT A RATE THAT WE LAST SAW AT THE TAIL END OF THE GREAT RECESSION.
SO 2012, UM, AND DELINQUENCY RATES ARE AT RATES THAT WE LAST SAW AT THE TAIL END OF THE GREAT RECESSION.
SO ANYTIME YOU PICK UP A NEWSPAPER FOR THE NEXT, UH, FOR THE NEXT SEVERAL MONTHS, AND YOU SEE A STORY ABOUT DELINQUENCY RATES OR CONSUMER DEBT OR HOUSEHOLD DEBT, YOU'RE GONNA KEEP GETTING A CALL BACK TO, THIS IS THE HIGHEST LEVEL.
IN 12 YEARS, THE CALLBACK'S ALWAYS GONNA BE BACK TO THIS 2012 PERIOD, WHICH WAS THE VERY END OF THE GREAT RECESSION PERIOD.
AND SO, IF YOU CAN THINK ABOUT 2012, YOU'RE ON THAT, THAT, UH, IN A, IN A SITUATION WHERE YOU WERE KIND OF ON THE PRECIPICE BETWEEN NORMAL ECONOMIC CONDITIONS AND DISTRESSED CONDITIONS.
AND SO THE CALLBACK IS GONNA BE TO THE LAST TIME WE WERE KIND OF RIGHT ON THAT TRADE OFF.
AND SO IT'S NOT CLEAR THAT HOUSEHOLDS ARE IN DISTRESSED, BUT IT'S CLEAR THAT THEY'RE KIND OF ON THE PRECIPICE OF BEING RIGHTED BETWEEN, UH, BEING ABLE TO MANAGE AND, AND BEING DISTRESSED A LITTLE BIT.
AND YOU SEE THIS IN, IN HOUSEHOLDS AND WHAT THEY'RE SPENDING ON HOW MUCH OF THEIR INCOME THEY'RE SPENDING TO SERVICE DEBT.
HOUSEHOLDS ARE SPENDING ABOUT 11 TO 11 AND HALF PERCENT OF THEIR INCOME RIGHT NOW ON DEBT PAYMENTS.
SO INTEREST IN PRINCIPAL PAYMENTS ON, ON HOUSEHOLD DEBT, AND AGAIN, 11 TO 11 AND HALF PERCENT OF, OF INCOME ON DEBT TRACKS BACK TO 2012.
IT'S RIGHT ON THAT LINE BETWEEN KIND OF SUSTAINABLE AND DISTRESSED.
AND SO WHEN YOU LOOK AROUND THE US ECONOMY, I THINK ONE OF THE THINGS, ONE OF THE TAKEAWAYS IS GONNA BE THE CONTEXT AGAINST WHICH HOUSEHOLDS ARE GONNA BE MAKING PURCHASE DECISIONS THIS YEAR, IS THAT THE LABOR MARKET IS IMBALANCED.
THERE'S NO EXAGGERATED STRENGTH.
IT'S ROUGHLY ONE AN EMPLOYEE PERSON FOR EVERY JOB.
AND CONSUMER CREDIT MARKETS ARE PRETTY STRETCHED.
I CAN, I CAN SERVICE MY DEBTS, BUT I DON'T HAVE A LOT OF EXCESS ACCESS TO CREDIT.
RIGHT? HOUSEHOLDS ARE GETTING A LITTLE, A LITTLE TIGHT IN TERMS OF HOW MUCH INCOME THEY'RE ALLOCATING TO DEBT AND HOW MUCH ACCESS THEY HAVE TO CREDIT TO, TO SPUR CONTINUED SPENDING.
AS THE FEDERAL RESERVE WAS ABLE TO SORT OF BRING SOME OF THIS SPENDING, THIS WAGE PRESSURE AND SPENDING PRESSURE UNDER CONTROL, WE'VE SEEN INFLATION MOVE BACK TOWARDS 2%.
AND SO BY AND LARGE, THIS TELLS US THAT THE POLICY REGIME WAS, WAS FOR THE MOST PART SUCCESSFUL, WE, THE MONETARY POLICY GOT RID OF THAT WAGE INFLATIONARY PRESSURES BY GETTING RID OF THAT EXCESS DEMAND, BRINGING US BACK TO ONE JOB OPENING FOR EVERY ONE UNEMPLOYED PERSON.
AND WE BROUGHT INFLATION UNDER CONTROL BY GETTING RID OF SOME OF THAT EXCESS DEMAND FOR GOODS AND SERVICES BY HOUSEHOLDS.
UM, AND THEY'RE ALL, UH, NOW ON, UH, SORT OF UNDER THE, THE BURDENS, THE CONSTRAINTS OF THEIR, UH, THEIR CREDIT SITUATIONS.
SO WE'RE BACK TOWARDS 2%, BUT WE'RE NOT ALL THE WAY THERE.
THIS CREATES, UH, SORT OF AN UNKNOWN FOR WHERE THE FEDERAL RESERVE WILL MOVE IN 2025.
I THINK RIGHT NOW, THE GENERAL CONSENSUS IS THAT THEY'RE NOT GONNA DO ANYTHING FOR A FEW QUARTERS, OR AT LEAST FOR A FEW MONTHS AS THEY TRY TO ASSESS ECONOMIC CONDITIONS AND WHETHER INFLATION IS MOVING TOWARDS 2% OR WHETHER IT'S STUCK AT 2.5%, UH, OR CREEPING BACK UP TOWARDS 3%.
SO THE FEDERAL RESERVE IS KIND OF ON PAUSE RIGHT NOW, BUT
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INFLATION IS MOVING BACK IN THE RIGHT DIRECTION.UM, AND WHEN YOU LOOK AT CAPITAL MARKETS AND CAPITAL MARKETS, YOU HAVE KIND OF THIS EXAGGERATED CONTRIBUTION TO HOUSEHOLD'S, PERCEPTIONS OF THEIR NET WORTH HOUSEHOLD'S, PERCEPTIONS OF WEALTH.
SO THE S AND P 500, UH, EXPANDED BY 20% PLUS FOR TWO YEARS IN A ROW FOR THE FIRST TIME SINCE THE MID 1990S.
AND SO IF YOU'RE INVESTED IN PUBLIC EQUITIES, PUBLIC STOCK MARKETS GAVE YOU 25% RETURNS TWO YEARS IN A ROW FOR THE FIRST TIME, AGAIN, SINCE THE, SINCE THE MID NINETIES.
BUT RIGHT NOW, IF YOU LOOK AT MARKET PE RATIOS, IF YOU'RE GONNA BUY INTO THE STOCK MARKET, YOU'RE BUYING IN AT 25 TO 30 TIMES EARNINGS TO BUY INTO THAT MARKET.
AND WHEN YOU LOOK AT DIVIDEND YIELDS, THE STREAM OF DIVIDENDS THAT'S COMING OFF OF THOSE, UH, THAT MARKET INVESTMENT IS YIELDING A LITTLE LESS THAN ONE AND A HALF PERCENT.
AND SO BOTH OF THESE ARE IN THE TAILS OF THEIR HISTORICAL DISTRIBUTIONS.
AND SO, UH, STOCK MARKETS APPEAR TO BE, UH, WELL, UH, LISA COOK, FEDERAL RESERVE GOVERNOR IS GONNA USE THIS QUOTE, SHE'S GONNA SAY IN THE SECOND PARAGRAPH, VALUATIONS ARE ELEVATED IN A NUMBER OF ASSET CLASSES, INCLUDING EQUITIES AND CORPORATE DEBT, WHERE ESTIMATED RISK PREMIUM ARE NEAR THE BOTTOM OF THEIR HISTORICAL DISTRIBUTIONS.
THIS IS A FANCY WAY OF SAYING THAT WHAT YOU'RE PAYING TO BUY INTO THE MARKET AND THE DIVIDEND YIELDS YOU'RE GETTING OUT OF THEM ARE BOTH AT THE, SORT OF THE EXTREMES OF THE HISTORICAL, UH, DISTRIBUTIONS SUGGESTING THAT MARKETS MAY BE PRICED TO PERFECTION AND THEREFORE SUSCEPTIBLE TO LARGE DECLINES.
AND SO ONE OF THE CONTEXTS THAT WE'RE WATCHING AS WE GO INTO 2025 IS THIS REALITY THAT HOUSEHOLDS, INCLUDING HOUSEHOLDS RIGHT HERE IN EDMOND, THAT ARE SORT OF THE FOUNDATION OF THE SALES AND USE TAX LIFELINE OF A CITY, THESE HOUSEHOLDS HAVE STRETCHED ACCESS TO CREDIT.
THEIR ABILITY TO CONTINUE TO ACCESS CREDIT AND USE CREDIT IN SOME WAYS HINGES ON THEIR PERCEPTION OF, OF THEIR OWN WEALTH.
AND THEIR WEALTH IS IN A LOT OF WAYS TIED RIGHT NOW TO THE STOCK MARKET THAT HAS GIVEN THEM 25% RETURNS TWO YEARS IN A ROW FOR THE FIRST TIME SINCE THE 1990S.
AND IT'S THE REASON WHY THE FEDERAL RESERVE IS POINTING TO THIS IN PARTICULAR AND SAYING, HEY, WE'RE ATTUNED TO THIS REALITY THAT THIS MAY BE A RISK TO THE OUTLOOK.
IS THAT A WEAKNESS IN THE STOCK MARKET, WHICH WE MIGHT NORMALLY DISMISS AS NOT PARTICULARLY PREDICTIVE OF CONSUMER HOUSEHOLD BEHAVIOR IN THIS CASE, WHERE WE'RE AT RIGHT NOW, IT MAY BE THE CASE THAT WEAKNESS IN THE STOCK MARKET DOES DRIVE CHANGES IN CONSUMER BEHAVIOR IF CONSUMER BEHAVIORS ARE REALLY BEING MOTIVATED BY A SENSE OF WEALTH WHERE THAN A SENSE OF INCOME OR IT OF FLOWS THROUGH MY HOUSEHOLD.
BUT WHERE THERE A SENSE OF MY HOME IS WORTH 30% MORE THAN IT WAS A COUPLE YEARS AGO.
MY, MY ACCOUNTS ARE WORTH 40% MORE THAN THEY WERE A COUPLE YEARS AGO.
AND SO I'VE GOT THE WEALTH TO CONSIDER SPENDING AS LONG AS I GIMME, AS LONG AS I CAN ACCESS CREDIT, I'LL CONTINUE TO SPEND, UM, ON THE BASIS OF MY WEALTH.
SO THE FEDERAL RESERVE IS SORT OF VERY ATTUNED, I THINK, TO TO, TO THIS RISK UNLESS THEY THINK ABOUT FEAR AND HOLD ONTO IT.
AND SO I, I THINK EVEN TODAY, YOU KNOW, IT'S, IT'S, IT'S VERY INTERESTING.
I WAS IN A SIMILAR LUNCHEON TODAY WITH THE CITY OF OKLAHOMA CITY FINANCE TEAM, AND IN THE BACKGROUND, SOMEBODY POINTED OUT THERE'S A HEADLINE ON CNBC AND THE TV THAT, AND THE RESTAURANT THEY WERE IN, UH, THAT SORT OF, THAT SAID, YOU KNOW, LIKE THE, THE STOCK MARKET RIGHT NOW, IS THIS A SOFT PATCH OR IS THIS A, OR SOMETHING MORE MM-HMM
RIGHT? I THINK EVERYBODY'S SORT OF KIND OF WATCHING TO SEE IS THIS EVERY TIME THE STOCK MARKET GOES DOWN BY 700 POINTS LIKE IT DID A COUPLE DAYS AGO, YOU'RE GONNA SEE PEOPLE MORE ATTUNED TO THAT THAN WE NOR NORMALLY ECONOMISTS WOULD BE SOMEWHAT DISMISSIVE OF THAT AS NOT PARTICULARLY PREDICTIVE, BUT IN THIS ENVIRONMENT IT REALLY COULD BE.
AS PEOPLE, IF HOUSEHOLDS FEEL LIKE, OKAY, I NEED TO, I'M GONNA RETRENCH A LITTLE BIT, IF THEY REACT TO IT, IF THEY REACT TO IT, I'M GONNA RE, I'M GONNA RE, I'M GONNA RETRENCH, I'M GONNA REIGN IN MY SPENDING.
I'M GONNA TRY TO GET A SENSE OF WHAT'S GOING ON.
THERE'S A LITTLE BIT OF A, A SENSE THAT THE SAME MIGHT HAPPEN, UH, WITH A NEW ADMINISTRATION AND NEW ECONOMIC POLICIES.
NOT THAT THEY'RE NECESSARILY GOOD OR BAD, BUT IT MEANS THAT THEY'RE UNKNOWN ENOUGH AND THAT THERE'S ENOUGH VARIATION IN WHAT THEY COULD ULTIMATELY BE.
IT COULD CAUSE MARKETS AND HOUSEHOLDS TO PULL IN A LITTLE BIT AND TRY TO FIGURE OUT WHAT, WHAT IS A TRUMP ADMINISTRATION TAX POLICY GOING TO LOOK LIKE? WHAT WILL TARIFF REGIMES LOOK LIKE? AND IT'S LESS ABOUT, UH, SORT OF GOOD OR BAD, IT'S JUST THAT THEY'RE UNKNOWN AND THEY'RE UNKNOWN WITH SUCH A BROAD, UH, VARIABILITY THAT IT COULD SORT OF RETRENCH A LITTLE BIT.
SO WE'RE VERY MUCH SORT OF WATCHING THIS DYNAMIC OF HOW HOUSEHOLDS MIGHT BE FILLING.
SO LET'S LOOK A LITTLE CLOSER TO HOME.
HERE'S THE GOOD NEWS, RIGHT? SO THE, I DON'T KNOW IF THE FIRST SECTION IS BAD NEWS, BUT IT SORT OF SETS THE CONTEXT THAT THAT MARKETS ARE IN A POSITION WHERE, UH, HOUSEHOLDS MIGHT HAVE SOME STRETCHED ACCESS TO CREDIT.
THE GOOD NEWS IS OKLAHOMA'S LABOR MARKET IS STILL MUCH STRONGER THAN NATIONAL LABOR MARKETS.
AND SO IF IT'S ONE TO ONE NATIONALLY IN OKLAHOMA AND IN OCTOBER OF 24, SO AT THE END OF LAST YEAR IN OKLAHOMA, WE STILL HAD ALMOST, YOU KNOW, 1.8, 1.7 JOBS FOR EVERY ONE UNEMPLOYED PERSON.
AND SO WE HAD MORE JOB POSTINGS THAN UNEMPLOYED PEOPLE, WHICH IS THE REASON THAT OUR UNEMPLOYMENT RATE WAS 3.3%.
IN OCTOBER, OUR UNEMPLOYMENT RATE IS STILL INCREDIBLY LOW BECAUSE OUR LABOR MARKET
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IS STILL CHARACTERIZED BY HAVING MORE JOBS POSTED THAN UNEMPLOYED PERSONS IN THE MARKET LOOKING FOR JOBS.AND THAT'S KEEPING A LID ON UNEMPLOYMENT RATES.
IT ALSO MEANS, UM, WELL, IT MEANS A COUPLE THINGS, BUT AMONG OTHER THINGS FOR THIS BODY, IT MEANS THAT YOU CAN MAKE A REASONABLE CASE THAT THE MARKET LABOR MARKET CAN GENERATE INCOME IN 2025.
THAT THERE IS A DEMAND FOR WORKERS, THERE'S DEMAND FOR NEW JOBS, THERE SHOULD BE PRESSURES TO BID WAGES UP.
AND IF HOUSEHOLDS HERE HAVE TO RELY ON INCOME FLOWS RATHER THAN WEALTH AND CREDIT TO SPEND, YOU CAN AT LEAST MAKE THE CASE THAT WE'RE STARTING FROM A POSITION OF A SOMEWHAT OF A POSITION OF STRENGTH THAT WE'RE AT LEAST IN THE LABOR MARKET THAT'S PRETTY STRONG.
YOU CAN, YOU CAN CONTRAST THERE TO SOME OF THE COASTAL AND ILLINOIS, BUT LOOK LIKE CALIFORNIA HAS 1.7 UNEMPLOYED PERSONS FOR EVERY JOB ALREADY, AND THEIR UNEMPLOYMENT RATE IS 5.4%.
AND SO IF YOU LOOK AROUND THE NATION, YOU CAN SEE DIFFERENT STATES HAVE DIFFERENT LABOR MARKET REALITIES.
RIGHT NOW, ON AVERAGE ACROSS THE UNITED STATES, WE HAVE ONE UNEMPLOYED PERSON FOR EVERY ONE JOB POSTED.
BUT IN SOME STATES LIKE CALIFORNIA, YOU HAVE WAY MORE PEOPLE, UNEMPLOYED PEOPLE THAN JOBS IN STATES LIKE OKLAHOMA, YOU STILL HAVE MORE JOBS THAN UNEMPLOYED PERSONS.
IT AVERAGES OUT TO ONE, BUT THERE'S SIGNIFICANT VARIATION ACROSS THE STATES.
THAT'S NOT ALL BAD NEWS FOR US.
THAT TELLS US IN OKLAHOMA THAT, UH, THAT AT LEAST AS WE MOVE INTO 2025, WE MAY BE ABLE TO SUPPORT SOME JOB CREATION, WHICH SUPPORTS INCOME GAINS AND HOUSEHOLDS CAN SPEND OUT OF INCOME AND MAY NOT HAVE TO RELY ON CREDIT AND WEALTH TO CONTINUE SAVING, TO CONTINUE SPENDING.
WHEN YOU LOOK HISTORICALLY ACROSS THE MSA, THE MSA TYPICALLY ADDS ABOUT, I DON'T KNOW ABOUT RULE OF THUMB, ABOUT 1200, 1300 JOBS A MONTH DURING ECONOMIC EXPANSIONS.
AND SO WHEN YOU'RE IN THE MIDDLE OF AN ECONOMIC EXPANSION, THE OKLAHOMA CITY MSA IS GONNA ADD ABOUT 12 TO 1300 JOBS PER MONTH.
UM, AND THAT'S ABOUT WHAT WE DID IN 2024.
IN A LOT OF WAYS, 2024 EXCEEDED EXPECTATIONS, UH, WITH THE PACE OF, WITH THE PACE OF JOB GAINS.
UM, WHEN YOU LOOK AT OUR EXPECTATIONS NOW FOR NEXT YEAR, OUR EXPECTATIONS FOR NEXT YEAR IS THAT WE ADD ABOUT 1500 JOBS A MONTH IN THE MSA, ABOUT 18,000 JOBS IN TOTAL ACROSS THE MSA.
AND WE THINK THE CATEGORIES THAT SEE THE MOST JOB GAINS IN TERMS OF NUMBER OF WORKERS IS THE HEALTH SECTOR.
WE EXPECT, UH, GAINS IN THE HEALTHCARE SECTOR, UH, GAINS IN TRADE, TRANSPORTATION AND UTILITIES.
THIS IS REALLY, REALLY TRADE AND, AND SOME UTILITY GAINS LEISURE SERVICES.
THIS IS GONNA BE HOTELS, RESTAURANTS, ACCOMMODATIONS, LEISURE SERVICES.
AND THEN ON THE GOOD SIDE, CONSTRUCTION.
SO WE EXPECT CONSTRUCTION TO ADD, UH, HAVE A, A STRONG YEAR OF JOB GAINS IN 2025.
AND, AND IN NO SMALL PART, BECAUSE THERE'S A LOT OF PUBLIC DOLLARS, POLICY DOLLARS THAT ARE STILL UNSPENT, WE HAVE A LOT OF BIG PROJECTS THAT ARE GONNA BE, UH, BREAKING GROUND AT DIFFERENT STAGES IN THE OKLAHOMA CITY.
MSA, UH, SHOULD DRIVE SOME, SHOULD DRIVE SOME JOB GAINS.
AND SO RIGHT NOW, AS YOU SIT HERE, AND I, I, UH, AND, AND I'M GONNA GET TO A BUNCH OF CAVEATS AND CONDITIONS HERE IN A MINUTE BEFORE I SHOW YOU YOUR OWN SALES TAX FORECAST, BUT AS YOU SIT HERE RIGHT NOW, UH, THE INDICATIONS OF THE OKLAHOMA LABOR MARKET IS RELATIVELY HEALTHY.
WE SEEM TO BE IN, IN AN EXPANSIONARY CYCLE, AND THE ANTICIPATIONS THAT YOU WOULD ADD JOBS AS YOU MOVED INTO 2025.
NOW, ALL THAT SAID, WE DID JUST ACKNOWLEDGE THERE IS THE RISK OUT THERE, THAT, UH, UNKNOWN POLICY, A STOCK MARKET CORRECTION, ANY NUMBER OF THINGS COULD CAUSE HOUSEHOLDS TO CHANGE THEIR BEHAVIORS PRETTY QUICKLY.
BUT RIGHT NOW, AS YOU EXTEND THE TREND OF CURRENT, THE CURRENT SETS OF BEHAVIORS, THIS IS SORT OF WHERE YOU WOULD SEE, UH, THOSE BEHAVIORS LEADING.
WHEN YOU LOOK INSIDE THE OKLAHOMA CITY, MSA, YOU LOOK AT POPULATION DEMOGRAPHICS, AND I'LL, I'LL SHOW YOU, UH, THE SAME PICTURE FOR EDMOND HERE IN A FEW SLIDES.
BUT WHEN YOU LOOK INSIDE THE OKLAHOMA CITY, MSA ACROSS THE MSA, WE'RE STILL A LITTLE YOUNGER THAN THE US POPULATION ON AVERAGE.
SO WE TEND TO BE A LITTLE YOUNGER.
21.4% OF OUR POPULATION IS IN THIS 10 TO 24 YEAR, UH, YEAR OLD RANGE.
AND I CALL THIS RANGE OUR PERSPECTIVE LABOR FORCE.
THIS IS OUR PERSPECTIVE WORKING AGE POPULATION, OUR PRIME WORKING AGE POPULATION, 25 TO 54, THAT'S ABOUT 40%, 39.5% OF THE OKLAHOMA CITY MSA POPULATION IS IN THESE PRIME SEE, PRIME WORKING AGE, UH, INDIVIDUAL.
AND SO WE'RE, WE'RE WELL REPRESENTED IN THE PRIME WORKING AGE.
WE'RE A LITTLE OVERREPRESENTED IN THAT YOUNGER COHORT, THAT PROSPECTIVE WORKING AGE, WHICH IS REALLY AN ASSET FOR, UH, OKLAHOMA CITY.
I SAY IT MEANS THAT AS WE GO INTO THE NEXT GENERATION TO LABOR MARKET, WE DON'T, WE DON'T NEED THE END MIGRATION TO FULFILL THOSE NEEDS.
WE HAVE SOME OF, WE HAVE TOMORROW'S LABOR FORCE IN OUR BACK POCKET AS LONG AS WE KEEP 'EM HERE, AS LONG AS WE KEEP 'EM HERE.
SO I, THE, YOU KNOW, MY PHRASE IS TRAIN AND RETAIN MM-HMM
SO THAT'S THE CHALLENGE, IS IF WE CAN TRAIN THEM AND THEN CREATE AN ENVIRONMENT THAT RETAINS THEM, AND WE'RE SORT OF STARTING FROM A HEAD START.
IF YOU, IF YOU LOOK AT THIS PICTURE FOR COLORADO, COLORADO IS WAY UNDERREPRESENTED, THOSE YOUNG GROUPS.
AND SO FOR THEM TO SUPPORT ECONOMIC GROWTH IN, IN THE LONG RUN WILL REQUIRE IN MIGRATION, RIGHT? THEY'RE, THEY'RE SORT OF THE EXACT OPPOSITE OF OKLAHOMA CITY.
UH, WHEN YOU LOOK AT SOME OTHER STATES, THEY'RE MUCH UNDERREPRESENTED AS THAT YOUNG POPULATION.
UM, INSIDE THE MSA, UH, AGAIN, ALSO I THINK THIS IS, UH, ALSO SPEAKS
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OF SOME OPPORTUNITIES FOR EDMOND.YOU SEE, THE OKLAHOMA CITY MSA IS GROWING AND GROWING PRETTY AGGRESSIVELY.
AND SO ON THE LEFT HAND PANEL THERE, YOU SEE THE OKLAHOMA CITY MSA FROM 2001, I THINK THIS GOES THROUGH, ACTUALLY GOES THROUGH 22 OR 23, HAS GONE FROM ABOUT 37% OF THE STATE'S ECONOMY, 37% OF STATE GDP TO ABOUT 39.2% OF STATE GDP.
SO THE OKLAHOMA CITY MSA, THESE SEVEN COUNTIES IN CENTRAL, UH, OKLAHOMA ACCOUNT FOR MORE THAN 39% OF THE STATE'S ECONOMY, AND ABOUT 36.5% OF THE STATE'S POPULATION, UH, RIGHT HERE IN THESE SEVEN COUNTIES.
BUT OKLAHOMA COUNTY, RELATIVE TO THE MSA, THOSE SHARE ARE ACTUALLY GOING DOWN.
SO OKLAHOMA COUNTY ACCOUNTS FOR LESS OF THE SEVEN COUNTY TOTAL THAN IT DID 20, YOU KNOW, 22 YEARS AGO.
SO DOWN FROM 80% OF GDP TO 69.5% OF GDP AND DOWN FROM 60% OF THE POPULATION TO 54.7% OF THE POPULATION.
A LOT OF THESE GAINS ARE ADMITTEDLY IN MCLEAN AND CANADIAN COUNTY, MCLEAN AND CANADIAN COUNTY HAVE SEEN LARGE GAINS IN DURS RESPECTIVE SHARES OF M-S-A-G-D-P AND MSA POPULATION.
UM, BUT WHAT THIS TELLS US IS THAT THERE'S STILL A POOL OF PEOPLE INTO THE OKLAHOMA CITY MSA, BUT THAT POOL LIKE THAT PULLS THEM INTO THE CITY CENTER IS LESS STRONG.
AND SO OKLAHOMA CITY, IF OKLAHOMA CITY WANTS TO ACHIEVE A DENSE URBAN POPULA CENTER, THEY'VE GOT PROBLEMS THAT THEY'RE GONNA HAVE TO RESOLVE.
CHALLENGES, I'LL SAY, THAT THEY'RE GONNA HAVE TO ADDRESS.
AND IT'S GONNA REQUIRE LIKE A, IT'S AN INTENTIONAL DEVELOPMENT STRATEGY AND POLICY TO ACHIEVE THAT.
IN THE MEANTIME, UNTIL OKLAHOMA CITY KIND OF FIGURES OUT HOW TO, HOW TO CREATE THAT POOL INTO THE URBAN CENTER, IT MEANS THAT SUBURBAN AREAS, EDGE, EDGE AREAS, MCLEAN COUNTY, CANADIAN COUNTY, EDMOND, AND I ACTUALLY THINK EVENTUALLY NORTH, I THINK LOGAN COUNTY IS SORT OF ON THE LIST OF PROSPECTIVE COUNTIES IN THE 10 OR 20 YEARS AHEAD OF US THAT COULD SEE SOME OF THE GROWTH THAT WE'RE SEEING WEST AND ON THE SOUTH SIDE, I THINK UNTIL THEY FIGURE THAT OUT, YOU'RE GONNA CONTINUE TO SEE POOLS INTO THE METRO AREA.
BUT THEN PEOPLE IN THE METRO AREA FINDING LOCATIONS ON SOME OF THOSE EDGE AREAS, SUBURBAN AREAS AND EDGE CITIES.
AND SO OKLAHOMA COUNTY MIGHT CONTINUE TO ACCOUNT FOR LESS AND LESS OF THE MSA AS TIME GOES BY.
SO THE MSA IS GROWING OKLAHOMA COUNTY, UH, THEIR SHARES ARE ACTUALLY GOING DOWN.
WE THINK EDMOND POPULATION GROWS AT ABOUT 1.1% IN 25 AND 26.
UM, YOU CAN SORT OF SEE YOUR HISTORIC PATTERN.
YOU CAN SEE THOSE ROBUST POPULATION GAINS IN 2011, 12, 13, 14, UH, AS WE WENT THROUGH WITH THE STATE, WENT THROUGH A PERIOD OF ECONOMIC WEAKNESS IN 15, 16, 17, WE WENT THROUGH AN OIL AND GAS BUST IN 1516.
AND SO YOU CAN SORT OF SEE THAT WEAKNESS THAT THAT FILTERED IN THOSE PERIODS COMING OUTTA THE PANDEMIC.
MOND, AGAIN, EXPERIENCED THE 1.9% POPULATION GROWTH IN 23, BACK ABOVE 1% IN 22.
UH, WE'LL SEE WHEN THE 24 NUMBERS COME OUT.
AND THEN OUR FORECAST IS 1.1% IN 25 AND 26.
AND SO AGAIN, THOSE ARE FAIRLY SOLID POPULATION GROWTH RATES.
THE US POPULATION AS A WHOLE IS GROWING AT ABOUT HALF A PERCENT TO SIX TENTHS OF A PERCENT.
AND SO WHEN YOU SEE 1.1%, IT MAY, IT MAY FEEL LIKE A SMALL NUMBER, BUT IT'S ACTUALLY PRETTY ROBUST POPULATION GROWTH RATES.
AND IT'S ABOUT, YOU KNOW, ABOUT TWICE, ONE AND A HALF TO TWO TIMES THE, THE US GROWTH RATE.
YOU'RE TALKING ABOUT REAL SHIFTS IN THE MAKEUP OF THE US POPULATION.
UM, EDMOND IS STILL, WE TALKED ABOUT THIS LAST YEAR, EDMOND'S NOT UNLIKE OTHER EDGE CITIES.
I WAS IN EL RENO RECENTLY AND WE HAD THESE SAME PICTURES FOR EL RENO.
THEY HAVE THE EXACT SAME REALITY A LOT OF EDGE CITIES DO, AND THAT YOU HAVE TWO DIFFERENT POPULATIONS.
IF YOU LOOK AT THE POPULATION OF PEOPLE LIVING IN EDMOND, UH, ABOUT 79% OF THE PEOPLE WHO LIVE IN EDMOND ARE EMPLOYED OUTSIDE OF EDMOND.
AND SO YOU HAVE A LOT OF PEOPLE THAT LIVE HERE IN EDMOND.
THEY GET UP IN THE MORNING, THEY LEAVE THE CITY, AND THEY GO TO WORK IN OKLAHOMA CITY OR IN A, IN A, IN A DIFFERENT, UH, METROPOLITAN, IN DIFFERENT CITY, DIFFERENT JURISDICTION.
AND AT THE SAME TIME, IF YOU LOOK AT PEOPLE WHO ARE EMPLOYED IN EDMOND, BUT LIVING OUTSIDE EDMOND, IT'S ABOUT 77.2%.
AND SO IF YOU THINK ABOUT THE JOBS THAT ARE LOCATED IN EDMOND, THERE'S A LOT OF INFLOW EVERY DAY, A LITTLE INCOM COMMUTE EVERY DAY OF WORKERS WHO ARE COMING IN THAT LIVE OUTSIDE OF EDMOND COMING IN TO FILL THE JOBS THAT ARE HERE IN EDMOND AND IN OUTFLOW OF EDMOND RESIDENTS WHO ARE GOING TO WORK, UH, IN, IN OTHER PARTS OF THE MSA.
AND AGAIN, THIS IS NOT UNUSUAL FOR, UH, FOR AN EDGE CITY.
THIS IS, THIS IS NOT UNIQUE TO EDMOND.
UM, AND IT'S REALLY, AGAIN, IN OUR MIND, NOT RIGHT OR WRONG, DESIRABLE OR UNDESIRABLE, IT'S JUST A REALITY THAT SPEAKS TO, UM, UH, SORT OF OPPORTUNITIES AND CHALLENGES AS YOU HAVE TWO DIFFERENT POPULATIONS, UH, OUT COMMUTE AND IN COMMUTE EVERY DAY.
WHEN YOU LOOK AT YOUR, YOUR, YOUR DEMOGRAPHICS, I THINK, HERE'S THE PICTURE THAT WE LOOKED AT FOR OKLAHOMA CITY.
THIS IS PRETTY INTERESTING FOR EDMOND.
IF YOU GO BACK TO 2010, UH, YOU CAN REALLY SEE THAT EXAGGERATED OVERREPRESENTATION OF YOUR 10 TO 24 YEAR OLDS, RIGHT? ALMOST 30% OF THE POPULATION, 29.2%
[00:25:02]
OF THE POPULATION IN THAT 10 TO 24 YEAR RANGE.SO YOU CAN SEE YOU'RE HEAVILY REPRESENTED IN, UH, I THINK MAYBE NOT A SURPRISE IN SORT OF THAT TRADITIONAL, UH, SCHOOL AGED RANGE, 10 TO 24, REALLY OVER OVERREPRESENTED THAT POPULATION UNDERREPRESENTED IN THE YOUNG PROFESSIONALS.
SO IF YOU LOOK AT SORT OF THE 25 TO 39 DEMOGRAPHIC, YOU'RE UNDERREPRESENTED, UNDERREPRESENTED RELATIVE TO THE DISTRI, THE AGE DISTRIBUTION OF THE US POPULATION.
AND THEN YOU'RE BACK TO OVERREPRESENTED.
YOU GET TO THE OLDER PROFESSIONAL, THE PARENTS OF THE 10 TO 24 YEAR OLDS, RIGHT? SO THE PARENTS, UM, THAT HAVE, THAT HAVE BROUGHT THEIR CHILDREN INTO THE, UH, INTO THE JURISDICTION, THAT 45 TO 54 RANGE, YOU'RE A LITTLE OVERREPRESENTED.
IT'S A LITTLE LESS EXAGGERATED, BUT THE PATTERN'S STILL THERE IN 2023.
AND SO YOU CAN SEE SLOWLY OVER TIME, EDMOND'S SORT OF MOVING IN THEIR POPULATION.
DEMOGRAPHICS LOOK A LITTLE LESS UNIQUE, A LITTLE MORE LIKE THE MSA ON AVERAGE, BUT YOU'RE NOT THERE YET.
THE SAME PATTERNS THERE IN 2010 IS A LITTLE LESS PRONOUNCED, BUT IT'S THERE IN 2023 OVERREPRESENTED IN THAT FIVE TO 24 GROUP, BUT IT'S ABOUT 22%, 22.6% OF THE POPULATION INSTEAD OF 29.2% OF THE POPULATION UNDERREPRESENTED AT 25 TO 34.
SO STILL, UH, SORT OF NOT, UH, UH, NOT A COMMUNITY THAT IS ATTRACTING AND RETAINING THAT, THAT YOUNG PROFESSIONAL 25 TO 34, BUT THEN AGAIN, A LITTLE OVERREPRESENTED, UH, IN THAT 35 TO 39, 40 TO 44, AND 50 TO 54, RIGHT? AGAIN, PRESUMABLY SORT OF THE PARENTS OF THAT UNDER THE, THE OVERREPRESENTED, UH, COHORT THERE AT THE, AT THE, AT THE LOWER END OF THAT AGE DISTRIBUTION.
SO EVAN DEFINITELY HAS A LITTLE BIT OF A UNIQUE AGE DISTRIBUTION THAT I THINK IS SORT OF FITTING REFLECTIVE OF THE AMENITIES, THE PARTICULAR SET OF AMENITIES THAT, UH, THAT EDMOND HAS DEVELOPED AND, AND OFFERS.
SO WHERE DOES IT LEAD TO SALES TAX? AND SO IN THE LAST, UH, I THINK THE LAST TWO PICTURES, THE LAST THREE SLIDES AND, AND, UH, UH, ON TALKING ABOUT SALES AND USE TAX, UM, I THINK JUST A REMINDER, I ALWAYS, UH, YOU KNOW, PERIODICALLY, WE'LL, WE WILL RE REMIND, UH, CITY COUNCILS AND AUDIENCES THAT WE WORK WITH ON FORECASTS, THAT ANYTHING THAT IS MEASURED ACROSS TIME IS DE CAN BE DECOMPOSED INTO FOUR INFLUENCES.
WHERE'S IT GOING IN THE LONG RUN? WHAT'S SORT OF THE DRIFT? IT CAN BE DECOMPOSED INTO A SEASONAL COMPONENT.
HOW DOES IT FLUCTUATE PREDICTABLY AROUND MONTHS OR QUARTERS OR WEEKS? IT CAN BE DECOMPOSED INTO A CYCLICAL COMPONENT.
THIS IS A CYCLE THAT, THAT AS MODELERS, WE TRY TO MODEL AND CAPTURE RELATIONSHIPS WITH OTHER INSIDE THE DATA.
AND THE FOURTH ONE IS A RANDOM COMPONENT.
AND THAT RANDOM COMPONENT BY DEFINITION IS UNKNOWABLE, RIGHT? IT'S, IT'S LITERALLY RANDOM IN THE TRUEST SENSE OF THE WORD IN THE, IN THE PROBABILISTIC SENSE OF THE WORD RANDOM IN THE SENSE THAT IT'S UNKNOWABLE, UN MODELABLE UNCAPABLE.
AND SO, UH, ANYTIME YOU HEAR FORECAST, AND CERTAINLY MINE FALL INTO THIS CATEGORY, PLEASE, PLEASE RECOGNIZE NOBODY HAS A CRYSTAL BALL.
'CAUSE NOBODY CAN CAPTURE THAT RANDOM ELEMENT, RIGHT? IT'S THERE IN EVERY TIME SERIES, NOBODY CAN CAPTURE IT.
WHAT WE'RE TRYING TO DO IS WE'RE TRYING TO CAPTURE THAT LONG-TERM DRIFT.
WE'RE TRYING TO CAPTURE THE SEASONALITY, WE'RE TRYING TO MODEL THE CYCLE, AND WE'RE TRYING TO ANCHOR THE CONVERSATION AROUND SOMETHING THAT, AGAIN, BUT IF THE PHRASE I USE WITH OKLAHOMA CITY ALL THE TIME IS TRYING TO MANAGE THE MISSES, WE, WE KNOW EVERY FORECAST, EVERY SALES TAX FORECAST IS GOING TO MISS, WE'RE TRYING TO MANAGE THE MISSES.
WE'RE TRYING TO CONSTRAIN THE CONVERSATION TO KEEP IT INSIDE A SET OF PARAMETERS SO THAT MISSES ARE MANAGEABLE, UM, AS YOU, AS YOU GUYS EXPERIENCE THEM AND GO THROUGH THEM.
SO HERE YOU ARE THROUGH YOUR FIRST SIX MONTHS OF THE YEAR.
SO THIS IS YOUR DATA THROUGH THE FIRST SIX MONTHS OF THIS FISCAL YEAR.
THIS IS WHERE WE STOPPED THE DATA SERIES.
WE STOPPED THE DATA SERIES WITH THE DECEMBER, ESSENTIALLY THE DECEMBER CHECK THROUGH SIX MONTHS OF OBSERVATIONS.
AND THEN WE FORECASTED OUT THE NEXT SIX MONTHS OF THIS FISCAL YEAR AND THE 12 MONTHS OF THE COMING FISCAL YEAR, 2026.
AND SO IN BLUE, YOU SEE YOUR KINDA, YOUR GROWTH RATES THERE.
THOSE ARE YOUR, YOUR GROWTH RATES MONTH TO MONTH.
AND IN RED IS YOUR YEAR TO DATE TRACKING.
AND SO YEAR TO DATE THROUGH DECEMBER, YOU WERE DOWN ABOUT 2% YEAR TO DATE FROM THE SAME SIX MONTH PERIOD TO START THE PREVIOUS FISCAL YEAR.
UM, AND I DON'T THINK THIS WAS PARTICULARLY UNEXPECTED.
UM, WE SORT OF COULD SEE THIS COMING THROUGH THE DATA.
THEY SORT OF OPEN THE FISCAL YEAR ON THE SOFT END AND THEN MAKE UP SOME OF THAT ON THE BACK END.
AND SO THE QUESTION IS HOW MUCH CAN YOU MAKE UP ON THE BACK END IN THE NEXT SIX MONTHS? BUT THE PATTERN OF, OF SORT OF STARTING A LITTLE BIT IN THE WHOLE TO START THE FISCAL YEAR AND THEN MAKING UP SOME OF THE BACKEND, UM, I THINK WAS, WAS, UH, FORESEEABLE, UM, IN THE DATA.
I WILL SAY THAT THE DATA RIGHT NOW ARE INCREDIBLY NOISY.
WE, WE REMAIN CONCERNED THAT AS REMITTERS TRY TO ADJUST TO A STATE GROCERY SALES TAX EXEMPTION, LARGE REMITTERS SEEMINGLY HAVE FIGURED THAT OUT.
IT'S, THEY CAN, THEY CAN BARCODE IT, THEY CAN SKEW IT UP, AND THEY CAN SORT OF ADAPT THAT SMALLER REMITTERS PROBABLY HAVING LESS SUCCESS.
[00:30:01]
THE TAX COMMISSION TRYING TO HAVE SUCCESS COLLECTING AND DISTRIBUTING BACK TO CITIES, IT MEANS THAT WE'RE GETTING OBSERVATIONS THAT ARE EXAGGERATED, THAT THEY'RE NOT REALLY TELLING THE TRUE STORY OF WHAT HAPPENED THAT MONTH.IT'S WHAT HAPPENED THAT MONTH PLUS A LITTLE BIT OF AN ERROR.
THEY GOT FOLDED IN HERE OR GOT MADE UP HERE OR GOT MADE RIGHT IN THIS MONTH.
AND SO THE DATA ARE, ARE INCREDIBLY NOISY, UH, FOR US RIGHT NOW, UH, WHICH IS A LITTLE FRUSTRATING.
SO WHEN WE EXTEND IT, IT STILL FEELS LIKE, UH, KIND OF FOR THE, THE REASONS I JUST GAVE YOU, WE'RE VERY CONCERNED ABOUT THE REALITY THAT HOUSEHOLDS MIGHT RETRENCH MIGHT REALLY LIKE FEAR MIGHT KICK IN UNKNOWN POLICIES, UNKNOWN VARIATION, STOCK MARKET CORRECTION, RIGHT? I'M ALREADY STRETCHED MY ACCESS TO CREDIT HOUSEHOLDS COULD ABSOLUTELY RETRENCH.
BUT YOU'RE STARTING FROM A POSITION WHERE THE LABOR MARKET'S REASONABLY HEALTHY.
YOU HAVE, UH, YOU HAVE VERY LOW, UH, FILINGS RIGHT NOW FOR UNEMPLOYMENT INSURANCE, INITIAL CLAIMS AND CONTINUING CLAIMS. YOU HAVE JOB POSTINGS IN EXCESS OF THE NUMBER OF UNEMPLOYED PEOPLE.
YOU HAVE EMPLOYERS ACROSS THE MSA ADDING JOBS.
AND SO YOU HAVE THE UNDERLYING ECONOMY SHOULD SUPPORT ENOUGH INCOME GENERATION TO CONTINUE IN A MODEST EXPANSIONARY MODE.
AND SO WE'VE GOT US, AS WE EXTRACT YOUR DATA, WE'VE SORT OF GOT A GOOD PLACE TO BALLPARK AND BEGIN YOUR CONVERSATIONS IS TO END THE YEAR DOWN 1.4%.
THERE'S A LITTLE BIT OF SOME, SOME ACCOUNTING, UH, THINGS THAT ARE GOING ON BEHIND THE NUMBERS THAT WILL ROLL ON AND OFF THROUGHOUT THE YEAR, BUT WE HAVE YOU DOWN 1.4%.
IN OTHER WORDS, WE THINK ON THE BACK SIX MONTHS, UH, THAT THERE'S ENOUGH STRENGTH THERE THAT IF YOU'RE DOWN 2% THROUGH DECEMBER, THAT YOUR CHECKS AS THEY COME IN WILL BE A LITTLE STRONGER THAN THAT.
UM, AND WE'VE GOT YOU DOWN 1.4% TO END THIS FISCAL YEAR AND UP 6.6% NEXT YEAR, WHICH IS A LITTLE BIT OF, UM, UM, WHICH IS NOT AS OPTIMISTIC AS THE NUMBER ORIGINALLY APPEARS, RIGHT? AND SO YOU GOTTA REMEMBER, YOU'RE, IF YOU'RE COMING OFF OF TWO, TWO CONSECUTIVE YEARS OF DOWN 0.2 AND UP AND DOWN 1.4 TO BE UP 6.6, YOUR SALES TAX IS NOT INFLATION ADJUSTED.
SO THE PRICES THAT CONSUMERS ARE PAYING IN STORE, THOSE ARE GOING UP.
THERE'S MORE PEOPLE IN THE COMMUNITY.
WE SHOULD SEE SOME GROWTH IN SALES TAX IF WE CAN STAY IN THIS EXPANSIONARY PHASE.
IF WE DON'T GET DISRUPTED BY AN OUTSIDE SHOCK, BY A STOCK MARKET CORRECTION, UH, REALLY ONEROUS TARIFF POLICY THAT REALLY, UH, SHUTS A LOT OF RETAIL ACTIVITY DOWN.
IF WE CAN AVOID SOME OF THOSE OUTSIDE SHOCKS, WE SHOULD SAY IN THIS EXPANSIONARY, IN THIS SORT OF THIS EXPANSIONARY FRAME.
UH, AND THEN WE SHOULD SEE AGAIN, SOME CLARITY IN THE ACCOUNTING THAT I THINK IS MUDDLING SOME OF THE NUMBERS RIGHT NOW.
WE'LL SEE THAT CLARITY THAT SHOULD KICK IN AS WE MOVE INTO FISCAL YEAR 26.
THE, THE PANEL ON THE RIGHT JUST BREAKS IT DOWN TO SALES TAX A USE TAX, AND THEN IT COMBINES SORT OF A WEIGHTED, UH, COMBINATION OF THE TWO.
SO THAT SALES TAX CHART THAT YOU SEE IN THE LIGHT BLUE, THAT'S THE SAME PICTURE YOU SEE HERE ON THE LEFT.
IT'S JUST BEEN BLOWN UP ON THE LEFT, BUT IT'S THAT SAME DOWN NEGATIVE TWO AND 24 DOWN 1.4.
OUR PROJECTION IN 25 AND UP SIX, SIX AND 26 USE TAX.
UH, THE IN 24 UP, SIX IN 25 AND UP NINE AND 26.
WHEN YOU COMBINE THOSE TWO CELLS AND USE TAX COMBINED, YOU GET THAT, UH, PANEL ON THE RIGHT.
AND SO I THINK AGAIN, THE IDEA IS TO SORT OF BEGIN TO PROVIDE, AS YOU START THIS BUDGET PROCESS AND DEPARTMENTS BEGIN TO, UH, SUBMIT THEIR BUDGETS IS JUST TO ANCHOR THE CONVERSATION.
UM, PLEASE DO NOT TAKE ANYTHING THAT WE PROVIDE AS A, AS A CRYSTAL BALL THAT IS MEANT TO SUBVERT YOUR INTERNAL DELIBERATIONS.
WE'RE JUST TRYING TO FEED INFORMATION INTO THOSE DELIBERATIONS AND TRY TO ANCHOR THEM AROUND WHERE DATA SEEM TO BE HEADING.
SO THE US ECONOMY SEEMS TO BE MOVING TOWARDS TWO TO 2.5%, UH, GDP GROWTH.
UNEMPLOYMENT RATES SEEM TO BE STEADY AT FOUR TO FOUR POINT A HALF PERCENT, BUT I SHOWED YOU THE MAP THAT'S GONNA BE DIFFERENT ACROSS STATES.
UH, IT ONLY STAYS IN THAT RANGE IF STATES LIKE OKLAHOMA THAT HAVE LOW UNEMPLOYMENT RATES HOLD THOSE LOW UNEMPLOYMENT RATES, RIGHT? THE WASHINGTONS, THE ILLINOIS, THE CALIFORNIAS, THEY'RE ALREADY AT, YOU KNOW, 4.8, 5.4% UNEMPLOYMENT RATES.
WE ONLY STAY IN THIS RANGE IF THE OTHER STATES CAN STAY IN SORT OF THEIR LABOR MARKET FRAME.
INFLATION'S GONNA STAY JUST ABOVE 2% THIS YEAR.
SO WE'RE NOT GONNA GET BACK TO OUR 2% TARGET, BUT WE'LL MOVE IN THAT DIRECTION.
WE MIGHT GET SOME RATE CUTS, WE THINK MAYBE TWO TO THREE RATE CUTS IN THE SECOND HALF OF THE YEAR.
SO 50 TO 75 BASIS POINTS IN THE SECOND HALF OF THE YEAR.
WE THINK IF YOU CAN STAY IN THIS EXPANSIONARY PHASE, IF YOU, IF YOU DON'T GET DISRUPTED BY AN ADVERSE SHOCK, 1500 NEW JOBS A MONTH, ABOUT 18,000 JOBS ACROSS THE OKLAHOMA CITY.
MSA HEALTH TRADE LEISURE CONSTRUCTION LEADING THE WAY, 1.2% POPULATION GROWTH IN THE MSA 1.1% POPULATION GROWTH IN EDMOND, 0.7% POPULATION GROWTH ACROSS EDMOND COUNTY.
WE THINK OKLAHOMA CITY'S UNEMPLOYMENT RATE STAYS AT OR UNDER 4% FOR MUCH OF THE YEAR, IF NOT ALL OF THE YEAR.
[00:35:01]
UM, AND THEN WE THINK, UH, FISCAL YEAR 25, UH, AND THE SALES AND USE TAX BE A CHALLENGING YEAR.UM, BUT WE DO THINK YOU'LL CLAW BACK SOME OF THOSE EARLY LOSSES TO END THIS YEAR.
UH, POPULATION GROWTH IMPROVED ECONOMIC CONDITIONS SHOULD SPUR 2026.
AGAIN, CONSTANTLY WITH THE IFS, THE CAVEATS AND THE CONDITIONS, IF WE CAN AVOID THAT OUTSIDE SHOCK.
SO WE DO NOT TRY TO, WE DO NOT DO A SCENARIO ANALYSIS.
WE'RE NOT TRYING TO PREDICT THINGS THAT ARE UNFORESEEN.
WE'RE TRYING TO EXTEND THE TRENDS IN THE DATA AND GIVE YOU AN IDEA OF HERE'S WHERE YOU'RE HEADING IF YOU DON'T GET DISRUPTIVE DISRUPTED BY SOMETHING ON THE OUTSIDE, AND THIS SEEMS TO BE WHERE YOU'RE HEADED AS LONG AS YOU DON'T GET DISRUPTED BY, UH, SOMETHING ON THE OUTSIDE.
SO, UH, I'D BE HAPPY TO, TO TAKE A QUESTION OR TWO.
I I KNOW KATHY HAS A COUPLE COMMENTS.
I'LL HAND IT BACK OVER TO KATHY.
UH, EITHER WAY, I DID HAVE ONE QUESTION.
PLEASE QUESTION ABOUT DURING YOUR ANALYSIS, UH, YOU SAID THAT, YOU KNOW, 79% OF EDMOND TRAVELS OUTSIDE TO GO WORK.
SO WE WE'RE GOING INTO EITHER ONE OR TWO CITIES AWAY TO WORK.
AND WE'VE SEEN WHERE OKLAHOMA CITY HAS MADE A VERY PART OF THEIR BUSINESS MODEL NOW IS TO BEEF UP THEIR ECONOMIC, UM, THEIR COMMERCIAL DEVELOPMENT RIGHT ON THE BORDER OF EDMOND ALL THE WAY FROM THE SOUTH EAST SIDE, NOW ALL THE WAY GOING UP TO THE NORTHWEST SIDE.
UM, I'VE ALWAYS LOOKED AT THAT AS ALSO AN INDICATOR BECAUSE WHEN YOU'RE TRAVELING OUT TO GO TO WORK, WHEN YOU'RE COMING BACK, SOMETIMES YOU'RE GONNA LOOK FOR THE MOST CONVENIENT PLACES TO SHOP.
NOT THINKING OR NOT SAYING TO YOURSELF, OH, I'M GONNA COME TO EDMOND BECAUSE I NEED THE SALES TAX DOLLARS.
THEY'RE GONNA SAY, I'M GONNA GO TO THIS PLACE IN WHEREVER.
YEAH, YOU MAY NOT EVEN KNOW YOU'VE LEFT NOT THE JURISDICTION.
YOU BE TRAVELING ON I 35, YOU DON'T EVEN KNOW.
BUT THE, BUT THE ITEMS THAT THEY NEED ARE CLUSTERED THERE AND THEY'RE GONNA DO THAT.
AND, UM, SO IS THERE ANY, WE CALL IT CELL TAX LEAKAGE OR FLOOD? IS THERE ANY, IS THAT ANY OF THAT PART OF YOUR ANALYSIS? BECAUSE THE PEOPLE, THE 79% OF PEOPLE THAT ARE LEAVING, THEY HAVE TO GO THROUGH THIS WAVE TWICE.
SO THERE'S, THERE'S NO DOUBT THAT, YOU KNOW, HAVING, HAVING DONE THIS WITH OKLAHOMA CITY FOR A LONG TIME, I DON'T, I DON'T KNOW THAT IT'S HOW INTENTIONAL IT IS IN ECONOMIC DEVELOPMENT, UH, POLICY, BUT CERTAINLY, UM, THEY'RE, THEY'RE AWARE IT SHOWS UP IN THEIR DATA WHEN A, A LARGE REMITTER, UH, OPENS ON THE EDGE OF A CITY AND SORT OF CAPTURES SOME OF THAT, SPILLOVER THOSE FLOWS FROM A NEIGHBORING JURISDICTION.
SO WE SEE THAT ON THE EDGES AND, AND, UH, YOU KNOW, WE'RE, WE'RE DOING A PROJECT ON THE WEST SIDE OF OKLAHOMA CITY RIGHT NOW, AND, AND IT'S THE, IT'S THE SAME TENSION BETWEEN OKLAHOMA CITY AND YUKON, RIGHT? IT'S THE, THE TENSION'S EVERYWHERE ABOUT, WELL, WHAT'S GOING ON? WE'RE ON THIS WITH THIS LAND THAT'S AROUND THE BOARD OF THE TWO JURISDICTIONS.
WHAT GOES THERE? WHAT, WHAT DOES EACH SIDE, WHAT DOES EACH SIDE VALUE? WE DON'T GO THROUGH AND TRY TO ESTIMATE WHAT THAT LEAKAGE IS.
I THINK THAT'S A VERY INTERESTING QUESTION.
I THINK IT'S A, IT'S AN ANSWERABLE QUESTION TO GO IN AND TRY TO LOOK AT, YOU KNOW, SO WHAT, WHAT, WHAT'S AN ESTIMATE OF WHAT EDMOND RESIDENTS MIGHT REASONABLY BE SPENDING IN A, IN A, IN AN ADJACENT SALES TAX, UH, YOU KNOW, JURISDICTION.
UM, I THINK IS, IS, THAT'S AN ANSWERABLE QUESTION, BUT NO, THERE'S NO, AND THAT, THAT MAY BE PART OF THE EXPLANATION OF, UH, EDMOND'S LONG RUN SALES TAX GROWTH SLOWLY COMING DOWN OVER TIME.
A PORTION OF THAT EXPLANATION MAY BE, UM, THAT SHOP THAT, THAT EDMOND RESIDENTS ARE SHOPPING OUTSIDE OF THEIR LOCAL JURISDICTION AND MAY NOT, MAY NOT EVEN BE AWARE, UH, YOU KNOW, THAT THEY'RE DOING IT.
ECONOMIC DISRUPTORS, SOME ARE KNOWN, SOME ARE UNKNOWN.
WHAT DO YOU, WHAT DO YOU DO TO, TO PROTECT YOURSELF, GUARD YOURSELF ON THOSE? YEAH, SO AGAIN, WE TRY HARD IN, THERE ARE THINGS WE CAN DO INSIDE OUR MODELS, RIGHT? SO WE CAN, WE CAN RUN A HYPOTHETICAL WHERE A RECESSION DEVELOPS, AND WE CAN LOOK AT HISTORICALLY, HOW HAS A CITY RESPONDED WHEN THERE'S BEEN A US RECESSION OR A LOCAL RECESSION, HOW HAS THAT IMPACTED SALES TAX COLLECTIONS? AND WE CAN KIND OF MODEL OUT THAT HYPOTHETICAL SCENARIO OF RECESSION DEVELOPING.
WE HAVE IN, IN THESE MODELS, WE HAVE OUR RECESSION INDICATOR TURNED OFF.
IN OTHER WORDS, WE'RE TELLING THE MODEL THERE'S NOT GOING TO BE A RECESSION THROUGH THE END OF FISCAL YEAR 26, BUT YOU CAN TURN THAT INDICATOR ON AND SORT OF GET A SENSE OF, OF WHAT THAT MIGHT BE.
BEYOND THAT, YOU'RE REALLY BEGINNING TO ASK YOURSELF, OKAY, WELL HOW, HOW SENSITIVE WOULD EDMOND HOUSEHOLDS BE TO CHANGES IN PERCEPTION OF, OF THEIR WEALTH AND NET WORTH? UM, AND AGAIN, THOSE ARE QUESTIONS THAT LIKE SORT OF INDEPENDENT STANDALONE RESEARCH QUESTIONS THAT YOU COULD LOOK AT.
WHAT'S THE EXPOSURE OF EDMOND HOUSEHOLDS TO PUBLIC EQUITY MARKETS? HOW LIKELY
[00:40:01]
ARE, WHAT'S THE, WHAT'S THE EXPOSURE OF EDMOND HOUSEHOLDS TO, UH, THEIR ABILITY TO CURRENTLY MAINTAIN SERVICE THEIR OWN DEBT, AND HOW THAT MIGHT THAT BE DISRUPTIVE DISRUPTED? SO YOU COULD LOOK AT THAT.WE DON'T HAVE ANYTHING LIKE THAT EXPLICITLY IN OUR MODELS.
WE'RE NOT TRYING TO CAPTURE WHAT COULD HAPPEN.
WE'RE TRYING TO EXTEND THAT DATA SO THAT IN THE SMART BODIES LIKE THIS CAN HAVE THOSE CONVERSATIONS AND SAY, HEY, IT FEELS LIKE THERE IS SOME DISRUPTORS ON THE HORIZON.
MAYBE WE NEED TO BE CAUTIOUS IN HOW WE BUDGET.
RIGHT? I THINK THAT THAT'S A DECISION, THAT'S A, THAT'S A CONVERSATION WE LEAVE TO THE ELECTED OFFICIALS.
IN YOUR YEARS OF EXPERIENCE, HAVE YOU SEEN, AND I KNOW YOU'RE AN ECONOMIST, NOT A MARKETER, BUT YOU'VE SEEN IT SURELY, UH, DO SHOP LOCAL MARKETING CAMPAIGNS WORK? DO THEY HELP? DO THEY STOP THE BLEEDING? I THINK, I MEAN, THERE'S SOME, THERE'S SOME INDICATION THAT, UH, THAT KNOWLEDGE SHAPES BEHAVIORS IN GENERAL.
SO IF YOU KNOW WHERE YOUR JURISDICTIONAL BOUNDARIES ARE, UM, DOES THAT SHAPE BEHAVIORS? THERE'S SOME INDICATION THAT IT CAN, THAT IT DOES.
THAT IS WE JUST MAKE, MAKE, MAKE ME AWARE OF THE ENVIRONMENT IN WHICH I'M MAKING DECISIONS.
UM, AND IT CAN CHANGE THE WAY I MAKE DECISIONS.
THERE'S A FAMOUS BOOK A FEW YEARS AGO ON, ON NUDGES.
SO KNOWLEDGE ABOUT THAT AND THEN, UH, THINGS THAT SORT OF POSITIVELY REINFORCE CAN BE, UH, CAN BE, UH, CAN BE SOMEWHAT EFFECTIVE.
SO IF THERE'S SOME SORT OF A FEEDBACK LOOP TO, RIGHT, AS SILLY AS IT SOUNDS, RIGHT, SOMETHING WHERE I SHOP LOCAL, THEN I GET SOME SORT OF A FEEDBACK GRATIFICATION OR SOME OF A WELL DONE, OR THANKS FOR MAKING US THINK LIKE, THANKS FOR, YOU KNOW, YOUR CONTRIBUTIONS, YOU KNOW WHAT I MEAN? SUPPORT YOUR LOCAL POLICE.
SOMETHING LIKE IF I GET SOME SORT OF INSTANT FEEDBACK GRATIFICATION AS, AGAIN, AS SILLY AS IT IS, THERE'S SOME INDICATION THAT ECONOMIC BEHAVIORS ARE, YOU CAN SORT OF, YOU WITHOUT, WITHOUT REALLY CHANGING THE, THE CALCULUS THAT SHOULD DRIVE ECONOMIC DECISION MAKING, I CAN CHANGE THE ENVIRONMENT IN WHICH YOU MAKE DECISIONS AND UM, AND UH, AND SOME OF THOSE THINGS CAN, CAN HAVE SOME MARGINAL EFFECT.
SO YOU HAD MENTIONED, I MEAN, PART OF THE FORECASTING INVOLVES THE CYCLE, SEASONALITY, ALL THE DIFFERENT THINGS.
SO I'M CURIOUS, JUST LOOKING MORE LONG TERM IN THE PAST AT EDMOND, I MEAN, DO WE SEE SORT OF A SO MANY YEARS OF GROWTH AND THEN SO MANY YEARS OF LOSS AND THEN, I MEAN, YEAH.
IS IT ALL OVER THE PLACE BECAUSE OF THE POPULATION CHANGE OR YEAH, IT'S A LITTLE, I THINK OUR DATA SERIES GOES BACK TO, UM, 2018 I THINK IS WHEN WE STARTED, WHEN WE START, WE HAVE MONTHLY DATA GOING BACK.
I THINK IT STARTS IN 2018, WHICH CANDIDLY IS JUST NOT A LONG ENOUGH TIME SERIES TO MM-HMM
PARTICULARLY WHEN YOU, YOU'RE STILL HAVE, YOU STILL HAVE THE POST PANDEMIC SHADOW BEING CAST OVER THE DATA SERIES.
AND SO YOU HAD THESE REALLY, YOU KNOW, YOU HAD THESE, THIS ODD PERIOD OF AN ECONOMY BEING CLOSED, THEN IT'S OPENS, THEN EVERYBODY IS FLUSHED WITH SO MUCH CASH.
EVERYBODY'S WORKING FROM HOME AND BUYING, LIKE ALL OF THAT STUFF IS STILL YEAH.
SO I DON'T KNOW IF THERE'S ANY PREDICTABLE LONG RUN PATTERNS.
UM, I DO THINK THERE'S ENOUGH INDICATION THAT THE LONG RUN PATTERN IS THAT, UM, EDMOND IS BECOMING A LITTLE LESS, YOU SEE THIS DEMOGRAPHIC SHEET A LITTLE BIT IN SALES TAX COLLECTIONS, A LITTLE LESS OF A UNICORN SORT OF EVERY YEAR THAT GOES BY RIGHT? BECOMES A LITTLE LESS UNIQUE AND A LITTLE MORE, VERY SLOWLY, MORE LIKE THE BROADER TRENDS IN THE DATA.
AGAIN, IT'S NOT ENTIRELY UNEXPECTED AS YOU GROW TO A CITY OF A HUNDRED THOUSAND PERSONS IS NOT, SHOULD NOT BE UNEXPECTED THAT YOU SORT OF TAKE ON SOME OF THE CHARACTERISTICS OF THE BROADER CITY.
BUT THAT'S A VERY, THAT'S A SLOW TREND I WOULD SAY THAT'S MAYBE VISIBLE IN THE DATA, BUT NOTHING LIKE, NOT, NOT ALL THE TIME SERIES TO FIGURE OUT TO THE OTHER.
THAT'S A GOOD QUESTION THOUGH.
UM, YOU'VE IDENTIFIED THAT WE, WE ARE UNDERREPRESENTED BY YOUNG PROFESSIONALS.
CAN YOU TALK ABOUT SOME OF THE SPENDING PATTERNS OF YOUNG PROFESSIONALS AND HOW THEY MIGHT DIFFER FROM AN AGE GROUP OF SAY 35 TO 54? YEAH.
SO, YOU KNOW, OBVIOUSLY I THINK, UM, UH, UH, WHEN YOU TALK ABOUT SPENDING PATTERNS, RIGHT? SO YOU HAVE, UM, I MEAN I TAKE THIS QUESTION TO NUMBER, LEMME TAKE THIS QUESTION IN THIS DIRECTION.
I HAVE A 24-YEAR-OLD IN THE OFFICE ABOUT TO GET MARRIED.
UM, AND, UH, HE AND HIS FIANCE WERE LOOKING FOR HOUSES AND THEY WERE LOOKING, THEY WERE LOOKING TO BUY, UM, AND THEY WERE LOOKING AT HOUSES IN EDMOND AND HOUSES SORT OF IN ADJACENT, UH, WHAT WOULD BE OKLAHOMA CITY PUBLIC SCHOOLS.
AND HE WAS FINDING IT REMARKABLE, THE PRICE DIFFERENTIAL.
AND HE WAS, HE WAS HAVING A HARD TIME UNDERSTANDING THAT REALLY THAT'S THE, THAT'S THE SCHOOL DISTRICT PREMIUM.
THAT MOVING INTO THAT COMMUNITY, THE AMENITY THAT YOU'RE BUYING, YOU'RE NOT BUYING ACCESS TO MAJOR SPORTS VENUES, YOU'RE NOT BUYING ACCESS, RIGHT? YOU'RE NOT BUYING KIND OF AN A, A DENSE URBAN DOWNTOWN AMENITY COMPLEX.
YOU'RE BUYING THE, THE AMENITY THAT YOU'RE BUYING IS THE PUBLIC EDUCATION AND THAT THAT
[00:45:01]
PREMIUM IS PRICED INTO THE REAL ESTATE.SO YOU'RE SORT OF STRUCK BY LIKE THIS, THIS COMPARABLE HOUSE IS THIS MUCH ON LIKE THREE MILES SOUTH.
AND SO I THINK THAT'S PART OF THE CHALLENGE IS THAT IT'S, IT'S JUST, UM, THE, THE TYPE OF HOUSING AND THE PRICE OF HOUSING IN EDMOND IS BUILT AROUND AN AMENITY REALITY THAT DOESN'T NECESSARILY MATCH THE AMENITIES THAT A TYPICAL 25 TO 34 YOU'RE SHOPPING FOR MM-HMM
AND, UM, SO NOT ALWAYS, BUT THE AGE GROUP OF 25 TO 34 IS USUALLY TYPICALLY CHILDBEARING YEARS, WHICH THEY IN TURN HAVE THE CHILDREN WHO ARE IN SCHOOL.
UM, BUT IT'S JUST AN INTERESTING, AND, AND THEY GET THERE.
SO YOU SEE THAT IN, IN, IN, LIKE THEY, YOU, SO IF YOU'RE MARRIED AT, UH, YOU KNOW, 25, 26, 27, I THINK THAT, I FORGET WHAT THE, WHAT THE STATISTIC IS, BUT IT'S, IT'S OVER HALF, UH, HALF CHILDREN WITHIN THE FIRST TWO YEARS.
AND I ALWAYS REMEMBER THAT STATISTICS, MY WIFE AND I HAD OUR FIRST LIKE TWO YEARS TO THE DATE OF WHEN WE GOT MARRIED WHEN OUR OLDEST WAS BORN.
AND I'M LIKE, OH, WE'RE LIKE, WE'RE THE STATISTIC, RIGHT?
SO IF I THINK IF YOU THINK THAT 25 TO 34, RIGHT? IF AGAIN, DOING YOUR MATH, YOU'RE, IT'S NEW HOUSEHOLD FORMATION.
WHEN, WHEN A COUPLE GETS TOGETHER GETS MARRIED, THEY SHOW UP AS A NEW HOUSEHOLD FORMATION, THAT'S A NEW POTENTIAL UNIT OF DEMAND FOR A HOUSING, HOUSING UNIT WITHIN TWO YEARS LIKELY HAVE THE FIRST KID.
SO IF YOU'RE HAVING YOUR FIRST KID AT 27, 28, AND THEN FIVE YEARS LATER AT 33, RIGHT? THAT CHILD'S IN SCHOOL, THEN BY THE TIME YOU GET INTO LIKE THE, THOSE ANOTHER AGE, THOSE, THOSE THAT NEXT AGE GROUP, YEAH.
YOU'RE BACK TO SAY, OKAY, WHAT'S THE AMENITY THAT I VALUE? AND YOU KNOW, AGAIN, LIKE, YOU KNOW, I HATE TO BE A STATISTIC, BUT LIKE THE REST OF US, THE IMMEDIATE I VALUES THE EDUCATION.
SO YOU MOVE TO THE COMMUNITY MM-HMM
YEAH, I THINK THAT'S PROBABLY CORRECT.
THAT'S ANECDOTAL, BUT I WOULD SAY THAT'S, THAT'S THAT, THAT'S AN ANECDOTE THAT RINGS TRUE A LITTLE BIT.
AND THE EDMOND PUBLIC SCHOOLS ARE SEEING A DI DECREASE IN ENROLLMENT THE LAST COUPLE YEARS.
I THINK, I THINK, UH, PROBABLY COMPETITION FROM EDGE CITIES THAT ARE SORT OF EMERGING WITH THE SAME AMENITY COMPLEX LIKE A PIEDMONT OR LIKE A, YOU KNOW, MAYBE TO A LESSER DEGREE OF DEER CREEK, BUT YOU'RE GONNA START SEEING SOME CHALLENGES FROM EDGE CITIES THAT ARE EMERGING WITH A SIMILAR AMENITY COMPLEX AND KIND OF A SIMILAR IDENTITY TO WHAT THE IDENTITY THAT EDMOND HAD, UH, YOU KNOW, A FEW YEARS AGO.
AND EDMOND'S SORT OF IN THE MIDDLE OF THOSE TWO, THOSE TWO REALITIES.
YOU HAVEN'T LEFT THE ONE IDENTITY BEHIND COMPLETELY, BUT YOU'RE SLOWLY MOVING TOWARDS LOOKING MORE AND MORE LIKE THE MSA.
THAT'S A GOOD POINT ON WE WANNA BE KEPT UPDATE ON YOUR EMPLOYEE.
DO THEY CHOOSE TO LIVE IN EDMOND? ABSOLUTELY.
UM, I, THAT'S WHY WE MOVED HERE FOR THAT, THOSE EXTRA AMENITIES THAT WE'RE PAYING FOR, UH, AND IN TODAY'S SOCIETY, I'M NOT SURE THAT THAT DEMOGRAPHIC AGE GROUP IS EVEN THINKING ABOUT THAT.
UM, SO, WELL MINE IS NOW I GOT HIM THINKING ABOUT IT, SO HE'S VERY, AT LEAST THERE.
OKAY, WELL THANK YOU DR. EVANS.
UM, OKAY, SO WE'LL CARRY ON HERE.
SO WE, WE GO OVER THIS EVERY YEAR, BUT WE'RE IN BUDGET SEASON RIGHT NOW.
IT WILL GO THROUGH JUNE 30TH AND WE HAVE TO ADOPT THE BUDGET BY JUNE 15TH.
UH, SO WHERE WE ARE RIGHT NOW, WE, ALL OF THE BUDGETS HAVE BEEN ENTERED AND LIKE WE DISCUSSED A LITTLE BIT EARLIER, UM, ALL THE DEPARTMENTS ENTERED THEIR OWN BUDGET THIS YEAR, AND WE HAVE GOTTEN COMPLETELY THROUGH OUR BUDGET REVIEW COMMITTEE.
SO WE'VE TALKED TO ALL OF THE DEPARTMENTS, AND SO WE'RE AT THE POINT RIGHT NOW, UM, WE'RE, WE'RE COMPILING EVERYTHING.
UM, AND TODAY IS OUR FIRST WORKSHOP.
SO, UM, YOU'LL, YOU'LL BE SEEING THE, THE, UH, OTHER TYPES OF BUDGETS THAT WILL BE COMING INTO THE NEXT WORKSHOPS.
BUT ALL ALONG THE WAY WE'LL BE PERFECTING OUR BUDGET BOOK TO SEE REALLY WHERE WE'RE ENDING UP.
UM, SO BUDGET COMPLETION WILL BE THE END OF APRIL AND IT, AND WE'LL, WE'LL PROVIDE TIME THEN THAT WE CAN REALLY STILL TALK, IF YOU GUYS WANT ANOTHER, UH, WORKSHOP OR SOMETHING LIKE THAT WITH ANY KIND OF A QUESTIONS, SEE WHERE WE ARE, WE CAN CERTAINLY, UH, SCHEDULE THAT AND THEN OUR PUBLIC HEARINGS IN MAY, AND THEN WE WILL ADOPT IN MID-JUNE.
SO JUST TO KIND OF TELL YOU, THIS IS SALES, SALES TAX ONLY.
BASICALLY SALES AND USE IS 60% OF OUR TAX DISTRIBUTION.
SO WHEN ALL OF OUR TAXES COME IN, THAT'S WHERE IT GOES OUT TO 30%
[00:50:01]
IS TO CAPITAL IMPROVEMENT FUNDS AND 10% IS JUST SPECIAL REVENUE FUNDS.SO ONE THING ABOUT THE GENERAL FUND SALES AND USES, AS YOU KNOW, IT IS SPLIT BASICALLY A THIRD EACH TO FIRE, POLICE AND GENERAL FUND.
UM, SO THAT'S JUST KIND OF TO, TO LET YOU KNOW WHAT WE'RE LOOKING AT AS FAR AS OUR SALES AND USE TAX AND WHERE IT GOES.
SO RIGHT NOW WE HAVE BUDGETED FLAT, AND SO YOU'RE GONNA SEE BASICALLY THE SAME NUMBER.
SO FOR FISCAL YEAR 24, 25, WHICH IS WHAT WE'RE IN RIGHT NOW, IT'LL END JUNE 30TH OF 25.
WE DO EXPECT TO BE PRETTY CLOSE TO WHAT WE HAD LAST YEAR ACTUALLY, WHICH IS 105 MILLION.
AND, UM, IT'S SPLIT LIKE YOU SEE THERE.
WE HAVE ALL THROUGHOUT THE WHOLE YEAR, KIND OF LIKE DR. EVANS SHOWED, WE'VE BEEN, BEEN DOWN THIS YEAR WE BUDGETED 1% GROWTH AND WE ARE AT A NEGATIVE 0.28.
SO BASICALLY WE'RE JUST, WE JUST HAVEN'T GROWN AT ALL.
UM, AND, BUT WE'RE SEEING IT ACROSS THE, THE, UH, THE STATE THOUGH BROKEN ARROW EVEN, UH, WE HAVE A THINK TANK WHERE WE TALK TO A LOT OF THE FINANCIAL DIRECTORS ACROSS THE STATE, AND BROKEN ARROW WAS EVEN SURPRISED LAST MONTH.
THEY DIDN'T HAVE THE SALES THAT THEY THOUGHT THEY WERE GOING TO.
SO I, IT JUST SOUNDS LIKE IT'S STATEWIDE.
PEOPLE JUST DON'T HAVE THE MONEY TO SPEND, LIKE THEY USED TO DURING COVID.
UM, SO OUR SALES TAX TRENDS WAY BACK TO 2015, OUR AVERAGE GROWTH FOR SALES TAX, JUST WITH ALL THINGS CONSIDERED IS 3.25%.
UM, AND WE'RE SITTING AT A NEGATIVE TWO RIGHT NOW.
SO HOPEFULLY WHEN WE COME BACK IN 26, WE'LL BE ABLE TO HAVE OUR LINE GO ABOVE THE AVERAGE AGAIN.
IT'S THE GROWTH RATE WAS JUST MUCH LARGER, 17%, UH, OVERALL OR FOR AN AVERAGE.
THAT'S KIND OF WHAT KEEPS US EVEN OUR USE TAXES UP, BUT OUR SALES TAXES DOWN AND, UM, OUR SALES TAX RATE IS 3.75% AND THIS IS HOW IT'S SPLIT.
IT'S 2% TO THE GENERAL FUND, WHICH IS ABOUT 46 MILLION.
THAT 46 MILLION DOES GET SPLIT IN THREE WAYS TO FIRE, POLICE AND GENERAL FUND.
UH, BUT 1% OF THAT IS SET TO EXPIRE IN MARCH OF 27, AND IT'S ABOUT 23 MILLION, UM, FOR SALES TAX.
CIP 2000, CIP IS, UH, UH, SO 0.75% AND IT'S ABOUT 17 MILLION THAT WE BRING IN.
WELL, IT'S WHERE WE FUND ALL OF OUR CITY DEBT OUT OF.
UM, WE HAVE, THERE HAVE BEEN QUESTIONS ABOUT OUR DEBT LATELY THAT, THAT YOU MIGHT SEE IN SOCIAL MEDIA.
AND UH, MOST OF OUR DEBT IS FROM WATER.
UH, THREE 2% IS FROM ELECTRIC, OUR BRAND NEW DEBT THAT WE HAVE FOR ELECTRIC.
AND THEN 15% IS, IS THE DEBT THAT WE SEE AT THE CITY LEVEL.
AND THAT'S WHAT'S PAID OUT OF THAT 17 MILLION.
UH, THE 2017 CIP FUND IS, IS HALF A CENT AND IT'S ABOUT 11 MILLIONS, BETWEEN 11 AND 12 MILLION.
AND IT ALSO, THE, THAT WHOLE THING WILL EXPIRE IN MARCH OF 27 IF IT'S NOT RENEWED.
UH, THE FIRE FUND IS A QUARTER OF A CENT.
POLICE FUND IS AN EIGHTH OF A CENT, AND THE PARK TAX FUND IS AN EIGHTH OF A CENT AND IT'S 6,000,003 AND THREE RESPECTIVELY.
SO RIGHT NOW OUR REVENUE ASSUMPTIONS FOR THIS YEAR WE'RE 1% GROWTH WEIGHT AND WE ARE AT A NEGATIVE 2.8%.
SO ALL TOLD TOGETHER IT'S ABOUT A $920,000 SWING, WE'RE DOWN 200,000 INSTEAD OF BEING UP 720, WHICH IS WHAT WE THOUGHT WE WOULD BE.
AND JUST, JUST AS A SIDE NOTE, EVERY MILLION DOLLARS IS 1% OF OUR UNRESTRICTED GENERAL FUND RESERVES.
NOT THAT THAT ALL WOULD GO THERE, BUT IT JUST KIND OF GIVES YOU AN IDEA OF WHEN WE ARE DOWN THAT WOULD BE 1%.
SO, UH, WHEN YOU SEE OUR RESERVES GOING DOWN, THAT WOULD BE WHY.
ALSO, UM, SO WE HAVE BUDGETED 0% GROWTH NEXT YEAR, HOPEFULLY.
WELL, YEAH, SO THROUGH 26 HOPEFULLY WE WILL SEE GROWTH LIKE DR. EVANS HAS MENTIONED AND WE WILL HAVE VERY CONSERVATIVELY ESTIMATED AND WE'LL BE OKAY.
BUT RIGHT NOW THAT'S JUST TO BE CONSERVATIVE IN WHAT WE'RE SEEING.
UM, THAT'S HOW WE'VE BUDGETED.
AND THEN EVERYTHING ELSE, SO BESIDES SALES AND USE, WE HAVE PUT IN A 1% GROWTH.
SO LICENSING AND PERMITTING, UM, YOU KNOW, OUR UTILITY CHARGES, THAT KIND OF THING.
AND THAT'S BASED ON POPULATION.
OUR RATE PAYERS, UM, THE ENTER THE ENTERPRISE FUNDS, SO LIKE, UM,
[00:55:01]
WELL, I PROBABLY SAID THAT WRONG ACTUALLY.THE ENTERPRISE FUNDS ARE BASED ON EACH GROUP, SO YOU OF THE UTILITIES.
SO ELECTRIC WATER, WASTEWATER, SOLID WASTE, THEY DO RATE STUDIES AND THEY'RE WATCHING THEIR COSTS SO THAT THEY CAN COVER 'EM.
UM, SO OUR FUNDING SOURCES HAVEN'T CHANGED.
UH, TAXES, OUR SALES USE, FRANCHISE GAS, THERE'S, UM, ALCOHOL, BEVERAGE, THAT TYPE OF THING IS 31% OF OUR REVENUE CHARGES FOR SERVICES, WHICH IS BASICALLY UTILITIES IS 63%.
UH, MISCELLANEOUS THINGS SUCH AS INTEREST RENTALS, ROYALTIES, ABATEMENTS, UH, ARE 4%.
AND THEN LICENSING AND PERMITTING IS 1% WHOSE PAYING IS, CAN YOU BACK UP? YES.
CAN YOU BREAK OUT THAT SECOND ONE? THE CHARGES FOR SERVICES UTILITY, 63%.
YOU MEAN AS FAR AS MOST OF IT IS? WELL, SO IT'S GONNA BE OUR RATES.
IT'S ABOUT $190 MILLION OF REVENUE.
THE OTHER THINGS ARE JUST GONNA BE, WELL, THEY'RE MOSTLY IN MISCELLANEOUS.
IT'S REALLY, IT'S REALLY OUR UTILITIES THAT BRINGS IN, RIGHT.
OH, YOU MEAN LIKE FOR ELECTRIC AND WATER? UGH.
I'M, BUT YES, I CAN
SO WE JUST, JUST THIS IS, I WAS GONNA BE IMPRESSED IF YOU COULD HAVE OH MAN, DARN IT.
I'LL TRY TO DO BETTER NEXT TIME.
UM, SO WE DO HAVE SIX DIVISIONS AND WE, WE'VE HAD THESE FOREVER.
UM, GENERAL FUNDS, SPECIAL REVENUE FUNDS, CAPITAL PROJECT FUNDS, UTILITY, OTHER ENTERPRISE AND INTERNAL SERVICE.
THE GENERAL FUND CAN PAY FOR ANYTHING.
UM, BUT THAT'S ALSO WHERE WE TRY TO KEEP THAT 10% UNRESTRICTED.
SO FOR EMERGENCIES, AND I, THE ICE STORM HAPPENED RIGHT AFTER I STARTED WORKING HERE, AND SO ALL WILL PROBABLY ALWAYS REMEMBER THAT.
AND IT WIPED OUT OUR, OUR UNRESTRICTED RESERVES, SPECIAL REVENUE FUNDS ARE MAINLY PUBLIC SAFETY, BUT THEY'RE ALSO, UM, ANYTHING LIKE THE OPIOID SETTLEMENTS, THE TOBACCO, ANYTHING THAT'S GOT A SPECIAL REASON THAT WE CAN'T SPEND IT ON SOMETHING ELSE.
UM, AND THOSE KEEP GROWING LIKE OUR URBAN FORESTRY, THAT NEW GRANT WE HAVE IS ONE OF THEM.
SO ANYTHING THAT YOU REALLY JUST HAVE TO TRACK BY ITSELF AND IT CAN'T BE SPENT ON ANYTHING ELSE.
CAPITAL PROJECT FUNDS ARE FUNDED, YOU KNOW, BY THE TWO CIP SALES TAX, AND IT'S THE LIST WE HAVE THAT IT'S LIKE 300 MILLION OF NEEDS SLASH ONCE AND WE HAVE 17 MILLION PLUS 11 MILLION, SO 28 MILLION A YEAR TO PAY FOR THAT.
AND THEN UTILITY FUNDS ARE OUR EPWA.
SO, UM, IT'S OUR WATER WASTE, WATER SOLID WASTE DRAINAGE.
UM, ALL OF THOSE FUNDS, OTHER ENTERPRISE FUNDS, THERE'S, THERE'S ONLY THREE OF THEM AND IT'S GOLF CITI LINK AND YOUR GOV SHOP, YOUR GOV SHOP IS A LITTLE CO-OP, THAT CO-OP THAT WE HAVE WHERE, UM, OTHER CITIES CAN PARTICIPATE AND BENEFIT FROM OUR PRICING.
SO WE'LL BUY A, A, YOU KNOW, WE'LL BUY A LOT OF GOODS AND THEN LET THEM PARTICIPATE AND THEN THERE ARE REBATES INVOLVED, THAT TYPE OF THING.
SO, UH, IT'S JUST GOOD, UH, WAY TO HELP OTHER CITIES.
UH, OUR GOLF COURSE IS DOING WONDERFULLY.
UM, THEY'VE DONE A GREAT JOB OF MAINTAINING THE GREENS.
I MEAN, MO DO YOU HAVE SOME GOLFERS HERE? AND, BUT IT'S BEEN VERY POPULAR, VERY SUCCESSFUL.
THEY'RE DOING A GREAT JOB OVER THERE.
AND THEN CLINK, UM, CLINK ACTUALLY IS SUPPLEMENTED BY THE GENERAL FUND.
WE HAD, UH, CARES MONEY AND THEN ALSO THE ARPA FUNDS.
SO IT DEFERRED THAT FOR US FOR ABOUT THREE OR FOUR YEARS, BUT WE'RE KIND OF BACK TO, I BELIEVE IT'S AROUND 2 MILLION A YEAR THAT WE FUND.
SO THAT'S KIND OF ONE OF THOSE THINGS THAT IF WE WANNA KEEP DOING IT, IT, IT COMES OUTTA GENERAL FUND.
AND THEN THE INTERNAL SERVICE FUNDS ARE JUST ALL OF THE, ALL OF THE FUNDS THAT JUST DON'T GENERATE REVENUE.
SO IT'S YOUR OVERHEAD TYPE THINGS LIKE FINANCE IT, UM, PLANNING IS IN THERE, ENGINEERING IS IN THERE.
SO, WELL ACTUALLY PLANNING IS NOT, BUT ENGINEERING'S IN THERE.
UH, BUT IT'S JUST, THEY GET ALLOCATED OUT TO ALL THE OTHER FUNDS AND THAT'S HOW WE BALANCE IT ALL OUT.
UM, SO THE DEBT, ABOUT 83% OF IT IS FOR THE VITAL WATER INFRASTRUCTURE, WASTEWATER AND, UM, SO, SO FORTH.
UM, A PERCENTAGE IS ELECTRIC, BUT THOSE ARE, SO THOSE
[01:00:01]
ARE ENTERPRISE FUNDS, THEY'RE SELF-SUSTAINING.SO THE DEBT SERVICE IS COMING OUT OF THOSE RATES AND NOT THE GENERAL FUND.
THE ONLY THING THAT'S COMING OUT OF THE CITY SIDE IS THAT, UH, SHOOT, I WISH I COULD TELL YOU OFF THE TOP OF MY HEAD TOO HOW MUCH IT IS, BUT YOU KNOW, THE, THE 1.2 BILLION THAT WAS MENTIONED IN SOCIAL ME MEDIA, UH, IS CORRECT, BUT THAT IS THE ORIGINAL DEBT AND WE HAVE PAID THAT DOWN.
SO THE LAST TIME I LOOKED, WE WERE AROUND, I DON'T, I WANNA SAY 820 MILLION AND ABOUT 745.
DON'T, DON'T CHECK ME EXACTLY.
THAT'S BUT 83%, ABOUT SEVEN 45 MILLION WAS WATER.
AND YES, DEFINITELY PAID FOR OUT OF WATER.
AND THEN THE 20 MILLION FOR ELECTRIC, WHICH WE HAVEN'T ACTUALLY, WE'RE GETTING READY TO SPEND THAT, BUT WE HAVEN'T SPENT ANYTHING YET.
AND THEN THE REMAINDER IS, UH, CITY FUNDS.
THE, THERE'S A LITTLE BIT OF A DIFFERENCE TOO.
AND I, THE, THE 17 MILLION THAT COMES IN FROM THE 2000 CIP, WE SPENT APPROXIMATELY 12 MILLION OF THAT ON DEBT.
SO IT JUST KIND OF GIVES YOU AN IDEA OF, OF WHERE WE ARE, BUT WE STILL HAVE, SO WE USE A 2017 CIP OF ABOUT 11 TO 12 MILLION PLUS ABOUT 5 MILLION REMAINING AFTER DEBT SERVICE IN THE 2000 CIP.
THAT'S WHAT'S AVAILABLE RIGHT NOW, JUST FOR STRAIGHT UP PROJECTS THAT WE DO IN THE CITY.
SO DID THAT ANSWER YOUR QUESTION? IT DOES.
IT JUST MAKES ME THINK OF LOTS OF THINGS, BUT YEAH.
AND ANYTHING, YOU KNOW, I'VE GOT MORE DETAIL THAT I COULD REALLY GIVE YOU.
BUT, UM, AND ANYBODY THAT WANTS TO KNOW REALLY WHERE WE ARE, WE DO PUBLISH THAT IN OUR BUDGET BOOK EVERY YEAR.
AT THE END, THERE IS A SUMMARY OF WHAT THE ORIGINAL DEBT WAS AND THEN WHERE WE ARE NOW AND WHAT PAYMENTS ARE LEFT.
SO IF YOU REALLY WANNA KNOW HOW MUCH PRINCIPAL IS LEFT, YOU HAVE TO, WELL, WE MIGHT HAVE A SUMMARY AND WE MAY WANNA PUT ONE IN THERE.
I'VE THE SPREADSHEET OF THE DEBTS AND WHEN THEY'RE PAID OFF.
BUT YEAH, THE OTHER THING THAT'S COMING TO MIND IS WITH MUNICIPAL EXPENDITURES, WE CAN'T COMMIT FOR MORE THAN A YEAR.
AND SO SOME PROJECTS WE HAVE TO USE DEBT TO DO IT.
WELL, AND YOU KNOW, THAT'S THE, THE, THE SECURITY FOR THESE DEBTS ALWAYS HAS A TIE TO EPWA.
AND SO THAT IS NOT, THAT IS UNDER DIFFERENT, A DIFFERENT TITLE AS FAR AS, UH, BEING ABLE TO COMMIT.
BUT SO THE, THE SECURITY FOR THE DEBT ARE THE RATES COMING IN.
WELL, AND IT'S, IT IS EPWA AND IT'S, THERE'S THE TWO SALES TAX, BUT ALSO, SO THE CIP THAT FUNDS IT DOESN'T SECURE IT.
IF, YEAH, SO WE HAVEN'T, WE HAVEN'T GONE OVER ANY LIMIT, LIKE WHAT WE CAN BORROW, THAT KIND OF THING.
IT'S JUST REALLY MORE OF A RISK, UH, TOLERANCE, YOU KNOW, FOR EVERYBODY INVOLVED ON HOW MUCH DEBT DO YOU WANT TO BE IN.
I MEAN, WE CAN PAY IT, BUT DO WE WANT PEOPLE WHO ARE GONNA BENEFIT FROM THESE MAJOR INFRASTRUCTURE THINGS TO PAY FOR ALL OF IT NOW? OR DO WE WANT TO SPREAD IT OVER THE RATE PAYERS OVER A NUMBER DECADES SO THAT IT'S NOT ALL BORN BY THE PEOPLE NOW.
AND WE HAVE NO MORE DEBT THAN OTHER CITIES OUR SIZE, EITHER GENERALLY IN LOOKING AT THE, YOU KNOW, OTHER COMMUNITIES.
THIS IS NOT AN UNUSUAL AMOUNT OF DEBT.
AND I MEAN, AS CHRIS, AND I THINK OUR WATER DIRECTOR HAS COMMENTED SEVERAL TIMES.
I MEAN, WE WERE WAY AHEAD OF THE BALL ON ALL OF THAT.
AND IT SOUNDS, AND HE'S ACTUALLY HAS SEEN IT HAPPEN NOW THAT OKLAHOMA CITY IN PARTICULAR ARE HAVING TO RAISE THEIR RATES AND OUR UNDERSTANDING IS THEIR RATES ARE GONNA BE HIGHER THAN OURS.
THEY WAITED AND WAITED AND IT'S GONNA COST THEM A LOT MORE.
AND EVEN, YOU KNOW, EVERYTHING THAT WE SEE, THE INFLATION AND THE THINGS THAT HAVE HAPPENED RECENTLY IN THE ECONOMY, EVERYTHING'S JUST ALMOST DOUBLED AND THE COST DEAL.
SO IT WAS GOOD THAT WE STARTED IN 2013, 'CAUSE WE DID SAVE SOME FUNDS DOING THAT.
BUT, UM, SO I, I JUST, HE'S DONE A GREAT JOB OF, OF PLANNING AND IT'S NOT SOMETHING YOU CAN JUST STOP EITHER.
AND, BUT I'LL TELL YOU WHAT, THAT WE'VE GOT, YOU KNOW, POTABLE DRINKING WATER ACROSS OUR CITY AND WE'VE GOT ENOUGH OF IT.
AND I DON'T KNOW THAT FOLKS ARE FOCUSING NECESSARILY ON THE PERCENTAGE RATE OF THE DEBT, WHICH, BECAUSE OF OUR BOND COUNCIL AND OTHER PROJECTS, WE'VE BEEN ABLE TO GET SOME OF IT AT 1% DEFINITELY.
SO THEY'VE DONE A GREAT JOB AS WELL.
AND, UM, THEY'RE ALWAYS LOOKING OUT FOR US.
[01:05:01]
I, I AGREE.I THINK THEY'VE DONE THE BEST THAT WE CAN DO.
EVERY TIME WE'VE DONE, UH, ANY TYPE OF A DEBT OFFERING SINCE I'VE BEEN HERE, I FEEL LIKE WE'VE GOTTEN A BETTER RATE THAN, YOU KNOW, IF YOU'RE JUST TRYING TO GO OUT TO THE MARKET, THEY'VE REALLY DONE REALLY WELL FOR US.
SO, OKLAHOMA WATER RESOURCE BOARD.
THERE'S OTHER, I MEAN, FOLKS ARE BEING VERY CREATIVE IN HOW WE'RE LEVERAGING WHAT WE DO HAVE AND GETTING THE BEST INTEREST RATES.
SO, AND OTHER PEOPLE COULD SPEAK TO THIS BETTER THAN ME, BUT YES, THE OWRB, THE OKLAHOMA WATER RESOURCES BOARD, WE ARE, UM, I DON'T KNOW WHAT YOU WANNA SAY, BUT WE'RE, WE'RE ABLE TO BORROW FROM THEM.
PRETTY MUCH WHENEVER WE NEED TO.
UM, AND IT'S, IT'S BECAUSE WE'VE DONE STUDIES AND WE CAN SUPPORT THE DEBT AND, UH, OUR INFRASTRUCTURE'S BEEN KEPT UP.
UM, SO WE'RE LOOKING JUST NOW THIS, JUST, THIS IS JUST A REAL HIGH LEVEL.
IF THERE'S OTHER THINGS YOU CAN THINK OF, LET ME KNOW.
BUT WHAT WE'RE GOING TO, WHAT WE'RE TRYING TO DO THIS YEAR, AND IT'S, IT'S ACTUALLY WHAT WE ALWAYS TRY TO DO IS MAINTAIN A 10% UNRESTRICTED GENERAL FUND BALANCE.
SO THAT'S GONNA BE AROUND $10 MILLION.
UM, AND IT'S, WHAT IT IS, IT'S 10% OF OUR REVENUES PLUS TRANSFERS IN.
SO IT'S BASICALLY 10% OF OUR RESOURCES.
UM, IT DOES NOT INCLUDE CARRYOVER FUND BALANCES, BUT IT'S JUST REVENUE COMING IN.
PLUS TRANSFERS, UH, SUPPLEMENTAL FUNDING FROM EDMOND PUBLIC WORKS AUTHORITY.
SO, UH, IE ELECTRIC
AND, UM, SO WE'VE TRIED TO KIND OF STICK WITH THAT.
WE'LL SEE HOW THE BUDGET COMES OUT AND IF WE NEED TO DO SOMETHING DIFFERENT.
BUT THAT'S WHAT IT'S BEEN FOR THE LAST SEVERAL YEARS, UM, ON OUR EXPENDITURES RIGHT NOW.
IT'S A LITTLE TRICKY RIGHT NOW BECAUSE EVERYBODY'S ENTERING, AND OF COURSE THEY'VE GOT THEIR NEEDS AND WHAT THEY THINK THEY'RE GONNA NEED NEXT YEAR.
SO THAT'S PRETTY MUCH WHAT'S BEEN ENTERED.
BUT WE DID ASK THAT EVERYBODY LOOK AT THEIR, IT'S THEIR SERVICES AND THEIR SUPPLIES TO KEEP THAT FLAT.
AND EVERYONE HAS DONE A REALLY GOOD JOB ABOUT THAT.
WE, WE DIDN'T LIMIT THOUGH THE NORMAL PLANNED, UH, INCREASES IN WAGES, WHICH IS, UH, STEP INCREASES FOR OUR CIVIL EMPLOYEES AND THAT OUR CONTRACTUAL INCREASES FOR OUR UNION EMPLOYEES, AND THEN JUST THE NORMAL BENEFITS THAT WE OFFER, WHICH ARE, UH, CONTRIBUTIONS TO PENSION, RETIREMENT, AND OUR INSURANCE.
SO THOSE WILL GO UP, YOU'LL SEE THAT GOING UP SOME, UH, AND THEN CAPITAL OUTLAY, IT'S ALL DEPENDENT ON THE PROJECT LIST AND THE AMOUNT OF MONEY THAT WE HAVE COMING IN AND THE, AND THE DEBT SERVICE ON THAT.
SO, UM, IT'S JUST KIND OF IS WHAT IT IS.
YOU KNOW, WE DON'T, WE, WE CAN'T SPEND CAPITAL ALLY MONEY IN GENERAL FUND ANYWAY, SO IT'S MORE ITS OWN THING, BUT THAT'S WHAT WE'RE TRYING TO DO RIGHT NOW.
SO UNLESS WE RUN INTO A REAL SNAG, WE WILL CONTINUE ON WITH PLANNED HIRING AND PLAN INCREASES FOR PERSONNEL.
EVERYTHING ELSE, WE'RE TRYING TO JUST KEEP FLAT.
AND THEN IF WE DO ALSO LOOK, THE FIRST THING THAT WE WILL LOOK FOR IS JUST, ARE THERE THINGS IN OUR NORMAL SERVICES OR, YOU KNOW, STUDIES, THAT KIND OF THING THAT MAYBE WE CAN DELAY A YEAR OR SOMETHING LIKE THAT IF WE NEED TO CUT.
UM, SO SOME OF THE THINGS THAT WE'VE TALKED ABOUT IS, WE'VE TALKED ABOUT THIS BEFORE HERE, BUT ESPECIALLY FOR OUR EPWA, THEY DO ACTUALLY HAVE FORMULAS THAT THEY USE FOR THEIR RESERVES.
UM, I'D LIKE TO GET 'EM IN WRITING SO YOU GUYS CAN REALLY SEE 'EM AND SEE IF THEY'RE, THEY'RE PRETTY MUCH THE SAME.
THEY HAVE TO DO WITH HOW MANY, YOU KNOW, CERTAIN NUMBER OF DAYS OF OPERATING EXPENSES, HOW MUCH THEY NEED FOR EMERGENCIES, IF THERE'S A STORM OR, UM, YOU KNOW, THOSE TYPES OF THINGS.
SO WE'LL GET THAT IN WRITING THIS YEAR SO YOU CAN REALLY SEE IT AND, AND DISCUSS IT HOWEVER YOU WANT TO.
BUT, UH, REALLY WE'D LIKE TO ESTABLISH THAT.
UM, OUR GENERAL FUND, WE JUST TRY TO MAINTAIN 10% UNRESTRICTED, SO THAT'S KIND OF BEEN IN PLACE ANYWAY, BUT WE'RE GONNA TRY AND LOOK AT AT THAT SO YOU CAN REALLY TALK ABOUT IT AND SEE IT.
UM, SO ONE THING WE KNOW, YOU KNOW, COSTS ARE GOING UP AND SO WE'RE GOING TO, OUR PLAN IS TO, WE STILL WANNA PROVIDE THE SAME QUALITY OF SERVICE INTERNALLY AND EXTERNALLY IS WE ALWAYS HAVE, BUT AT THE SAME EXPENSE WITHOUT, YOU KNOW, PAYING MORE OR BUYING EXTRA THINGS RIGHT NOW, UM, WE DO HAVE, IN, IN FINANCE AT LEAST, WE'VE REALLY BEEN ABLE TO UTILIZE SOME SOFTWARE WE BOUGHT A COUPLE YEARS AGO, AND IT'S BEEN SO HELPFUL BECAUSE WE CAN ANALYZE THINGS SO MUCH BETTER.
SO WE'RE TRYING TO REALLY WRITE THOSE REPORTS AND IF THERE'S EVER ANYTHING THAT YOU GUYS WANT TO KNOW, I THINK WE CAN PROBABLY WRITE A REPORT FOR IT NOW, WHICH IS REALLY A, IT'S A HUGE THING FOR ME.
IT'S JUST HELPED SO MUCH, MAKES
[01:10:01]
THINGS SO MUCH FASTER AND, YOU KNOW, IT'S COMING OUTTA YOUR SYSTEM AND NOT JUST, YOU KNOW, OUTTA MY HEAD.SO, UM, WE'RE, WE'RE UTILIZING THAT.
AND THEN, YOU KNOW, LAST BUT NOT LEAST, IF WE DO GET OUR BUDGET WHERE IT LOOKS LIKE WE'RE NOT GONNA MEET ALL OF OUR GOALS, WE'RE JUST PREPARED TO FIGURE OUT, WELL, WHAT ARE WE GONNA HAVE TO DELAY NOT SPEND THIS YEAR? HOW ARE WE GONNA DO IT? UM, AND THEN THE, WE DO HAVE SOME EXTERNAL OBLIGATIONS THAT WE'VE ALWAYS FUNDED, AND THAT IS OUR CARC REQUESTS, UH, WHICH IS OUR COMMUNITY AGENCY REVIEW COMMITTEE.
SO THAT'S OUR NONPROFITS THAT WE FUND.
AND THEN, UH, WE HAVE THE PARK TRUST, OUR EVAC, WHICH IS OUR, UH, VISUAL ARTS COMMISSION AND THE, THE AIRPORT, UM, ALL OF THAT TOGETHER IS ABOUT $2 MILLION.
I WILL TELL YOU, I DO GO TO THE, UH, AIRPORT MEETINGS AND THEY HAVE FINALLY, FINALLY GOTTEN SOME FUNDING FROM THE FAA.
AND WE HAD TALKED ABOUT YEARS AGO WHEN, UH, LARRY STEVENS WAS STILL HERE, AND I KNOW WE'RE JUST A COMMUNITY PARTNER WITH THE GUTHRIE AIRPORT THAT, UM, WE WOULD MATCH.
IT'S LIKE A 5% MATCH THAT GUTHRIE AND EDMOND SPLIT, AND IT, IT'S ABOUT A HUNDRED THOUSAND DOLLARS IS OUR SHARE.
AND WE'RE GETTING LIKE MILLIONS OF FUNDING FROM THE FEDERAL GOVERNMENT.
STEPHANIE BE'S OFFICE HAS REALLY HELPED WITH THAT, AS DID JIM IN HOF WHEN HE WAS STILL LIVING.
IT REALLY, I DON'T KNOW IF YOU'VE BEEN OUT THERE LATELY, BUT IT HAS IMPROVED SO MUCH AND I, I KNOW THEY'RE VERY APPRECIATIVE.
AND EVENTUALLY SOMEDAY AS WE ALL GROW TOGETHER, RIDE THESE EDGE CITIES,
I KNOW THAT WHEN WE HAVE OUR PGA EVENTS, A LOT OF PEOPLE WILL FLY IN THERE.
AND THAT WAS ONE OF THE THINGS TOO AT THE GUTHRIE AIRPORT, THEIR FUEL SYSTEM, THAT TYPE OF THING, JUST NEEDED ATTENTION AND THEY'VE REALLY GIVEN IT ULTIMATELY IT COULD REALLY HELP OUR ECONOMIC GROWTH.
ULTIMATELY IT COULD REALLY HELP OUR ECONOMIC GROWTH.
WE COULD GET SOME, UM, SUSTAINABLE COMPANIES THAT WANNA COME IN AND WELL JUST HAVE CONVENTIONS HERE AND THEY CAN FLY IN.
WELL, YOU KNOW, WE'D LOVE TO AND A LOT OF THE PLANE OWNERS OUT THERE CURRENTLY YEP.
AND, UM, 'CAUSE I WAS GONNA RECOMMEND FOR THE NEXT COUNCIL COMING IN THAT THEY, AS SOON AS POSSIBLE, THEY NEED TO HAVE A JOINT MEETING WITH THE GUTHRIE CITY COUNCIL AND THE AIRPORT BOARD TO GO THROUGH THE AIRPORT EXACTLY WHERE IT'S BEEN BEFORE AND WHERE IT IS NOW, AND WHAT IS THE PROJECTION FOR IT TO GO IN THE FUTURE.
UM, BECAUSE IT IS AN ECONOMIC GENERATOR FOR THIS ENTIRE REGION HERE.
UH, EVEN TINKER AIR FORCE BASE.
WELL, AND IT'S, THERE'S LOT OPPORTUNITY.
IT'S AN ASSET ASSET TO BRING IN COMMERCIAL BUSINESS.
I WILL, I KNOW, I HAVE NOTICED IN THE LAST YEAR THEY'VE MADE A LOT OF IMPROVEMENTS AND THE AIR TRAFFIC IS, HAS DOUBLED OR TRIPLED.
IT'S JUST STRANGE TO GO THERE AND YOU'RE LIKE, OH, AIRPLANES ARE FLYING IN.
UM, BUT UH, THERE, I THINK IT'S, IT'S, YEAH, IT'S A GOOD THING, THING A GOOD FACILITY.
IT'S A, IT'S A GOOD INVESTMENT.
IT WASN'T GOING TO, IT WASN'T GONNA GET DONE ON THE CURRENT FUNDING LEVEL.
SO HOPEFULLY FROM THE FEDERAL LEVEL MM-HMM
WE GET SOME ADDITIONAL FUNDING TO HELP.
THEY GET SUBSTANTIAL FUNDING YES.
FROM THE, FROM THE GOVERNMENT.
AND SO I'LL, I'LL CLOSE, I KIND OF WENT PAST IT, BUT, BUT WE DID HAVE KIND OF AN EXAMPLE OF THE INFLATION THAT WE'VE SEEN.
UM, OUR FIRE STATIONS HAVE GONE UNDER TWO REBUILDS.
WE'VE GOT HAD ONE IN 2018, ANOTHER ESTIMATED ONE IN 2027.
AND THEN WE HAVE FIRE STATION NUMBER SIX RIGHT NOW.
BUT COMPARING THE REBUILD THAT HAPPENED IN 2018 TO, TO THE ONE THAT WE'RE ESTIMATING FOR IN 2027, LAND, LAND COSTS HAVE GONE UP 113%.
IT'S, AND IT'S ABOUT THE SAME ACREAGE.
UM, DESIGN WORK UP 53%, CONSTRUCTION UP 97%.
AND, UM, JUST EVEN FURNITURE AND FIXTURES, 118%.
AND SO IT'S JUST, IT'S JUST EVERYWHERE.
AND UNFORTUNATELY WE'VE GOT, UM, I GUESS I DO HAVE ONE MORE.
THAT'S REALLY WHAT WE'RE SEEING.
OUR REVENUES HAVE FLATTENED OR DECLINED, BUT OUR COSTS CONTINUE TO GO UP.
WE'RE NOT IN DANGER YET, BUT WE WE'RE GONNA HAVE TO WATCH IT.
AND, UM, EVERY 1% LOSS OF OUR SALES TAX IS APPROXIMATELY $23 MILLION.
THE 1%, IF IT'S NOT RENEWED, 1% LOSS OF USE TAX TAX IS APPROXIMATELY 5 MILLION.
UH, THE LOSS OF THE 2017 CIP TAX IS APPROXIMATELY
[01:15:01]
12 MILLION.AND THE TOTAL LOSS OF MARCH 20, THE TOTAL LOSS OF THE MARCH, 2027 TAX IS NOT RENEWED, IS THE 40 MILLION, WHICH IS BASICALLY THE SUM OF THOSE.
UM, AND AT THE SAME TIME, OUR CITY'S GROWING.
WE HAVE AGING INFRASTRUCTURE, UH, SO JUST A LOT OF DEMANDS.
IF WE RECOVER IN 26, THAT'S GONNA BE GREAT.
I THINK 25 MIGHT BE A LITTLE BIT OF A STRUGGLE.
SO HOPEFULLY IT'S JUST A YEAR.
BUT, UM, AND I THINK THAT'S ALL I HAD.
SO ANY QUESTIONS? THANK YOU, MS. MANIS.
I APPRECIATE THE, UM, THE UPDATE.
APPRECIATE, UH, ONE THING I REMIND THE, EVERYONE, THE PUBLIC, YOU KNOW, IS THAT WE DON'T MAKE ALL OF THESE DECISIONS IN A VACUUM.
WE HIRE PROFESSIONALS LIKE THE GREAT DOCTOR HERE, OUR BOND COUNCIL.
UH, THESE ARE EVEN WHAT OUR, OUR RATE STUDIES THAT ARE DONE, THESE ARE PROFESSIONALS IN, IN THEIR FIELD.
UH, IT'S, IT'S NOT ME TRYING TO FIGURE OUT OR, OR SOMEONE TRYING TO FIGURE OUT SOMETHING ON THE BACK OF A NAPKIN HOW TO, HOW THINGS SHOULD BE CALCULATED.
THESE ARE THE EXPERTS FOR IN THE REGION, IN THE FIELD HELPING THAT.
UM, ALSO, YES, WHEN WE WERE JUST TALKING ABOUT THE WATER WE TOOK, WE KNEW EVEN BACK IN 2013, WE WERE GONNA TAKE BULLETS.
UH, WHEN I GO DOWN TO 23RD STREET, THEY SAY, THANK YOU FOR TAKING THE BULLETS.
AND WHEN I, WHEN THE, WHEN WASHINGTON COMES IN HERE, THEY SAY, THANK YOU FOR TAKING THE BULLETS, BECAUSE WE MOVED OUT, EDMOND MOVED OUT FASTER THAN ANY OTHER CITY IN THE STATE OF OKLAHOMA ON THE WATER QUALITY.
AND SO I'LL SIT HERE, TAKE EVERY BULLET FOR IT.
BUT OUR WATER QUALITY HERE IN EDMOND'S GOOD.
AND WHAT WE'RE PUTTING INTO PLACE IS TO HELP FOR THE FUTURE.
UM, THE, AND KATHY, YOU CAN TALK ABOUT THE SNOWSTORM OF MM-HMM.
AND WHAT, BECAUSE THE RESERVES THERE.
IF WE DIDN'T HAVE THEM, GUESS WHAT? WE STILL MIGHT HAVE TWIGS OUT THERE FOR PEOPLE TO PICK UP.
BUT, UM, IT, IT IS A NECESSARY EVIL AND WE, WE MANAGED IT WELL, APPRECIATE THAT.
AND THEN I WANNA MAKE SURE I GET THE, THE TERM, THE AMENITIES THAT WE'RE PAYING FOR.
I'VE BEEN SEARCHING FOR THAT WORD FOR A LONG TIME.
THAT'S THE, THE, THE, THE UPCHARGE THAT WE PAY FOR OUR AMENITIES FROM.
I'M GONNA GIVE A SHOUT OUT TO ELECTRIC RIGHT NOW.
WE JUST WENT THROUGH ANOTHER CODE SPELL, AND I DON'T, I'M NOT AWARE OF MANY OF ANY COMPLAINTS ABOUT OUR ELECTRIC, UM, WATER.
JUST WENT THROUGH ANOTHER CODE SPELL.
I CAN'T IF YOU, IF YOUR PIPES FROZE, THAT'S NOT US
BUT WE HAD, THERE WAS WATER THERE, POLICE AND FIRE.
THESE WERE THE, THESE WERE THE FOUR GROUPS THAT WERE OUT THERE PROTECTING OUR CITY EACH AND EVERY DAY.
AND THOSE ARE UPCHARGES FOR OUR AMENITIES THAT WE HAVE HERE.
I'M GONNA GIVE YOU A SHOUT OUT IN CITY COUNCIL MEETING TOO, BUT THAT'S, THAT'S PART OF THE BUDGET, PROJECT PROCESS, SO THAT YOU, PEOPLE ASK, WHY DO WE MOVE HERE IN EDMOND? THESE, THESE AMENITIES ARE WHAT THEY'RE MOVING HERE FOR.
UH, THERE'S AN EXPECTATION, THERE'S A DESIRE, AND IT'S JUST A BASIC HUMAN NEEDS.
OH, YOU, YOU, YOU GAVE ME THAT PAUSE.
WERE YOU READY TO SAY SOMETHING ELSE, SIR? NO.
WAS THERE ANYTHING ELSE FROM COUNCIL? MM, WELL WE LOOK FORWARD AS WE GO FORWARD IN THIS PROCESS.
AND THEN, UM, I'M GLAD THAT THE PEOPLE WHO ARE COMING ON BOARD AND WE ARE HERE, 'CAUSE THEY'RE GONNA HAVE TO TAKE IT ACROSS THE FINISH LINE.
IF THERE'S NO OTHER QUESTIONS, COMMENTS FROM THE COUNCIL OR FROM, WE WILL SAY THIS WORKSHOP IS OVER.