[1. Call to Order of the Edmond City Council Meeting.]
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THIS SPECIAL MEETING TO THE CITY COUNCIL FOR OUR FIRST, FIRST, OR SECOND.
SECOND, I GUESS, BUDGET WORKSHOP TO ORDER.
[2. Presentation, Discussion, and Consideration of the Following Items Related to the Fiscal Year 2026-27 Budget: Presentation, Discussion, and Consideration of the General Fund Budget including: Assumptions in Forming Budget; Current Status of Budget; and Options for Fund Balance. Presentation, Discussion, and Consideration of the Public Safety Limited Tax Funds Budgets for Fire and Police Departments including: Current Status of Budget; and Fund Balance. Presentation, Discussion, and Consideration of the Edmond Public Works Authority Budgets (Electric, Water, Wastewater, Drainage, and Solid Waste) including: Current Status of Budget; and Outlook for Future Needs. Presentation, Discussion, and Consideration of the Fleet Management Budget including: Current Status of Budget; and Fund Balance. Presentation, Discussion, and Consideration of the Glossary of Terms including: Definitions of Terms as Requested by the Fund Structure and Budget Reform Committee; and Additional Terms included in Glossary. Presentation and Discussion of Remaining Timeline of Budget Process for the Fiscal Year 2026-27 Budget.]
UP ON THE AGENDA IS ITEM TWO, THE BUDGET.MR. KRIEGER, DO YOU WANNA KICK THIS OFF FOR US? YES, SIR, I WILL.
MAYOR AND COUNCIL, UH, WHILE KATHY MOVES UP TO THE LECTERN, WE, I THOUGHT I'D SPEND A SECOND JUST TO, UH, TRY AND FRAME WHAT HE WANTED TO ACCOMPLISH TODAY AND THEN SET THE, SET A STAGE FOR, UH, FOR GOING FORWARD.
WHAT WE HAVE PREPARED TO PRESENT TO YOU TODAY ARE SOME ARE FUND SUMMARIES, AND THEY ARE REPRESENTATIVE OF A BIT OF A WORK IN PROGRESS, MEANING THAT THEY'RE, THEY'RE NOT NECESSARILY INTENDED TO BE FINAL NUMBERS, BUT THEY IN MOST CASES SHOULD BE PRETTY CLOSE.
THESE SHOULD NOT BE SUBJECT TO WILD SWINGS OR WILD, UM, FLUCTUATIONS.
WHAT WE WANT TO DO IS PRESENT FUND SUMMARIES.
WE HAVE OBVIOUSLY MANY STAFF MEMBERS IN THE ROOM, DEPARTMENT, DIRECTORS IN THE ROOM.
IF THERE ARE SOME DETAILED QUESTIONS, WHAT WE HOPE WE CAN GET THROUGH IS AN OVERALL FUND SUMMARY.
UM, AND AS A QUICK ASIDE, WHEN WE GET TO THE GENERAL FUND, YOU'LL SEE THAT AS PRESENTED INITIALLY TODAY.
IT, UH, ANTICIPATES SOME DEFICIT SPENDING.
WE KNOW WE WON'T DO THAT, AND WE'RE GOING TO GIVE YOU SOME OPTIONS, UM, TO THINK ABOUT AND SELECT FOR CHANGES WE WOULD MAKE GOING FORWARD THAT WOULD REVERSE THAT.
AND WE ANTICIPATE A FINAL, UH, VERSION OF A GE DEFICIT OF A, I'M SORRY, A FINAL VERSION OF A GENERAL FUND BUDGET TO, UH, HAVE A SURPLUS, THE SIZE OF WHICH YOU'LL ULTIMATELY, UH, DETERMINE BASED UPON HOW YOU, UH, HOW YOU MAKE SOME DECISIONS.
UH, I THINK FOR A LITTLE BIT OF CONTEXT, THERE ARE A HANDFUL OF THINGS THAT WE'RE DOING, UM, KIND OF ON THE FLY, KIND OF AT THE SAME TIME.
ONE, WE ANTICIPATE THIS TO BE A, LARGELY A MAINTENANCE BUDGET.
UH, WE HAVE SOME, THE CITY FACES, SOME FINANCIAL CHALLENGES, AND WE'LL TALK ABOUT THOSE AS WE GO THROUGH.
UH, I KNOW THOSE, THERE HAVE BEEN, THERE'S BEEN A LOT OF DISCUSSION ABOUT THOSE OVER THE LAST SIX, UH, OR SO MONTHS, SEVERAL MONTHS.
SO WE ANTICIPATE MOSTLY ON, UH, A MAINTENANCE BUDGET, UM, UH, ALMOST NO NET NEW POSITIONS, UM, DEPARTMENT DIRECTORS, AND YOU'LL SEE THAT.
AND DEPARTMENT DIRECTORS, UH, WERE ASKED TO COME IN FLAT ON THINGS LIKE MATERIALS AND SUPPLIES AND SERVICES.
AND YOU'LL SEE AS WE GO THROUGH THAT THEY HAVE LARGELY FILED THAT DIRECTION.
THAT ISN'T, THAT OBVIOUSLY ISN'T SOMETHING WE CAN MAINTAIN YEAR OVER YEAR, OVER YEAR, BUT WANTED TO DO TWO THINGS THIS YEAR, RESPOND TO, UH, UH, A GENERAL NEED.
THEN ALSO SET THE STAGE FOR SOME LONGER TERM DISCUSSIONS.
THE, THE OTHER THING THAT'S HAPPENING IS WE'RE ABOUT TO EMBARK ON A YEAR PLUS, PLUS OR MINUS EFFORT, UM, TO TOTALLY, UH, UH, REFORM AND TO RESTRUCTURE THE BUDGET.
AND IN SOME RESPECTS, PICKING UP OFF THE WORK THAT'S BEEN DONE BY THE, UH, I ALWAYS CALL IT THE WRONG THING, BUT LIKE THE, THE BUDGET REFORM COMMITTEE, OR TRANSFORMATION OR COMMITTEE, WHATEVER IT'S CALLED.
BUT TO BEGIN TO PUT SOME OF THOSE THINGS IN PRACTICE.
AND WE THINK A BIG PART OF THAT WORK IS GOING TO BE, UH, SIMPLIFYING, UH, AND RESTRUCTURING THE FUNDS CAPITAL F FUNDS WITHIN THE BUDGET.
AND SO WE'RE NOT PROPOSING ANY MAJOR CHANGES TO THOSE CAPITAL F FUNDS THIS YEAR, BUT WANT TO, UH, LOOK TOWARD THE FUTURE WITH AN EYE ON RESTRUCTURING THOSE FUNDS, GETTING TO A PLACE WHERE IT'S, IT'S EASIER FOR US TO PREPARE, IT'S EASIER FOR US TO PRESENT.
IT'S EASIER FOR THE PUBLIC TO UNDERSTAND AND, UM, ULTIMATELY WILL BE A BETTER, UH, I THINK MORE USER FRIENDLY DOCUMENT.
SO JUST VERY BRIEFLY, I WILL, UH, BEGIN THE GENERAL FUND AND THEN, UM, KATHY WILL TAKE OVER.
YOU'LL NOTE THAT, AND THIS IS A GOOD EXAMPLE OF, UH, A WORK IN PROGRESS.
WE ANTICIPATE AS OF TODAY, THERE IS A 5.28% UNASSIGNED, UM, UH, FUND BALANCE IN THE GENERAL FUND.
WE'VE HEARD THE COUNCIL'S DIRECTION, UM, THAT WE GIVE YOU SOME OPTIONS TO GET TO, UH, 10%.
AND WE'RE GOING TO, UH, TO DO THAT.
SOME OTHER ASSUMPTIONS THAT HAVE BEEN EMPLOY EMPLOYED IN THE PREPARATION OF THIS DOCUMENT ARE 0% SALES TAX GROWTH.
WE'RE PROBABLY GONNA TALK TO YOU ABOUT LEAST IN ONE ALTERNATIVE THERE.
4% USE TAX AND 1% ALL OTHER REVENUE.
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I MENTIONED A SECOND AGO, UM, THERE MAY BE A NET NEW POSITION THAT YOU'LL HEAR ABOUT, BUT FOR THE MOST PART IN THE GENERAL FUND, THERE AREN'T ANY NET NEW POSITIONS.UM, BUT STILL OUR PERSONNEL COSTS ARE UP ABOUT 3.22%, UM, MATERIALS AND SUPPLIES DOWN ABOUT 2.8% OTHER SERVICES AND CHARGES DOWN NOT QUITE 2%.
AND A CAPITAL OUTLAYED DOWN, UH, JUST A LITTLE BIT.
AND ALL OF THOSE FALL REALLY IN THE, UH, UNDER THE, THE HEADING OF, UH, HOW, I THINK I SAID IT A SECOND AGO.
THIS IS REALLY AN ATTEMPT TO BE A MAINTENANCE BUDGET TO, TO CONTINUE PERFORMING THE SERVICES AND PROVIDING THE SERVICES THAT WE ARE REQUIRED TO, AND THAT WE'RE TASKED WITH WHILE NOT MAKING IT OR ANY MAJOR CHANGES, BUT GETTING TO A POINT WHERE THE COUNCIL HAS SOME, UH, SOME OPTIONS AND, UH, CAN EXPRESS SOME PREFERENCES AND GIVE US SOME DIRECTION AND WE'LL MAKE SOME, UH, UH, LONGER TERM, UH, CHANGES GOING FORWARD.
SO WITH THAT, I'LL STOP AND UNLESS THERE ARE ANY THOUGHTS OR QUESTIONS, I'LL ASK KATHY TO PICK IT UP IN THE GENERAL FUND.
GOOD AFTERNOON, COUNSEL, MAYOR, AND COUNSEL.
I'M KATHY PANIS, I'M THE FINANCE DIRECTOR, AND I WILL TAKE YOU THROUGH OUR SLIDES TODAY.
SO PLEASE, UH, IF YOU HAVE ANY QUESTIONS, JUST STOP ME AND WE CAN ANSWER THEM THEN.
BUT BASICALLY, WE ARE REALLY JUST DOING AN OVERVIEW OF WHERE WE ARE RIGHT NOW.
THIS WOULD BE 4, 6 30, 27 FISCAL YEAR, 6 30, 27.
UH, THE REVENUE, WE'RE ESTIMATING THE, UM, EXPENSES WE'RE ESTIMATING AND WE'RE GONNA HIT THE GENERAL FUND, POLICE AND FIRE AND MOST OF OUR UTILITIES.
SO I'LL START WITH THE GENERAL FUND.
AND, UM, OVERALL TOTAL REVENUE.
WE ARE ESTIMATING AT ABOUT 68 MILLION FOR TA FOR TAXES.
AND REMEMBER THAT DOES HAVE THINGS OTHER THAN SALES AND USE.
IT'S GOT, HAS FRANCHISE AND, UH, LIQUOR TAXES ARE IN THERE, BUT IT'S UP ABOUT 1.22% FROM THE YEAR BEFORE.
AND AS AN ESTIMATE, LICENSING AND PERMITTING 3.2 MILLION, THAT'S UP ABOUT 3% FROM OUR ADOPTED 26 BUDGET, UH, IN OUR GOVERNMENT, EXCUSE ME, FINES AND FORFEITURES, WHICH IS BASICALLY OUR COURT FEES.
AND I WOULD HAVE TO HAVE YOLANDA REALLY EXPLAINED THAT.
BUT THESE ARE ALL BASED ON WHAT THE D DIFFERENT DEPARTMENT HEADS HAVE ENTERED INTO THEIR BUDGET.
UH, INTERGOVERNMENTAL ARE BASICALLY GRANTS.
UM, AND IT'S DOWN A LITTLE BIT ABOUT 10%, BUT THAT'S BASICALLY BECAUSE YOU NEVER REALLY KNOW WHAT GRANTS YOU'RE GOING TO GET.
THE NEXT ONE IS CHARGES FOR SERVICES.
FILING FEES RIGHT AWAY IS A BIG, UH, CHARGE IN THIS CATEGORY.
AND, UH, IT IS UP ABOUT 12 13% FROM OUR ADOPTED BUDGET.
THE IN INTEREST IN INVESTMENT INCOME, WE'VE ACTUALLY ESTIMATED IT DOWN ABOUT 55%, BUT THAT'S BASICALLY BECAUSE WE HAD A LOT OF DEBT, THERE WAS EARNING INTEREST AND WE'VE PAID DOWN A LOT OF THAT DEBT.
OR, YOU KNOW, WE FINISHED THIS BUILDING, FOR INSTANCE.
IT WAS A PRETTY GOOD, UH, CHUNK OF THAT, SO IT'S NOT SITTING IN CASH EARNING INTEREST.
AND THEN, UH, MISCELLANEOUS INCOME, PRETTY, PRETTY, EVEN AT 2% ABOVE.
SO AS WE WENT THROUGH, SO ONE OTHER THING I DO NEED TO POINT OUT.
SO 83 MILLION IS THE TOTAL REVENUE OR ESTIMATING.
RIGHT NOW TRANSFERS IN ARE THE SALES TAX PER OUR DEBT INDENTURE THAT WE HAVE TO SHOW OF ABOUT 18 MILLION.
AND THE OTHER IS A TRANSFER IN FROM ELECTRIC, ABOUT 4 MILLION THAT MAKES UP THE 22.
AND THAT 17 IS AN IN AND OUT, IF YOU RECALL.
SO REALLY IT'S, IT'S HAS NO EFFECT ON THE BUDGET, UH, USE OF FUND BALANCE RIGHT NOW.
SO WHEN WE WERE TALKING ABOUT THE 5.28%, UH, REMAINING FUND BALANCE, UNASSIGNED FUND BALANCE AT THE END OF 27 WOULD BE USING 1.2 MILLION OF THE FUND BALANCE.
AS WE GET INTO THE OPTIONS THAT OUR CITY MANAGER WILL DISCUSS A LITTLE BIT BIT MORE, THAT WOULD GO AWAY.
SO THE TOTAL SOURCES ARE 106, ALMOST 107 MILLION.
THE DOLLARS OUT OF GENERAL FUND ARE ALSO 107 MILLION.
UM, AND THEN THESE ARE JUST SPLIT BY THE VARIOUS DEPARTMENTS THAT WERE, ARE WITHIN THE GENERAL FUND.
AND, UM, BASICALLY AND GO THROUGH ALL OF THESE.
BUT BY AND LARGE, AS YOU SAW ON THE FIRST SLIDE WHERE WE WERE SHOWING KIND OF WHERE WE ARE, WE'RE PRETTY FLAT IN ALL OF OUR EXPENSES THIS YEAR, EXCEPT PERSONNEL.
SO, UM, AND, AND WE'LL GET INTO THIS A LITTLE BIT FURTHER DETAIL IN ANOTHER WORKSHOP, BUT OUR TRANSFERS OUT MOST OF WHAT THAT IS.
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POLICE AND FIRE, ABOUT 55 MILLION FIELD SERVICES OF ABOUT 10 MILLION, UH, CITY LINK OF ABOUT 2 MILLION.AND THEN THERE'S ADMINISTRATIVE SUPPORT AND FLEET.
SO THAT BASICALLY IS WHAT MAKES UP THAT 92 MILLION.
SO I'M GONNA TURN IT BACK OVER TO AJ AT THIS POINT, BUT WE DO ALSO HAVE, IF YOU'RE INTERESTED, WE CAN SHOW YOU, UH, INTERACTIVE WORKSHEET THAT TELLS YOU WHAT THE EFFECT OF EACH ONE OF THESE OPTIONS IS TO AFFECT OUR UNASSIGNED GENERAL FUND FUND BALANCE.
SO I'LL SAY AGAIN, KNOWING THAT THERE MAY BE A POINT AT WHICH AS A COUNCIL, YOU WANT TO DIVE IN, UH, MORE DETAILS TO SOME OF THOSE, UM, UH, BOTH REVENUES AND EXPENDITURES THAT, UM, KATHY JUST DESCRIBED, AS I MENTIONED A SECOND AGO, AND SHE JUST POINTED OUT, WE'RE ANTICIPATING, UH, 1.278 MILLION, WHAT YOU JUST SAW, ANTICIPATES 1.278 MILLION IN DEFICIT SPENDING OUTTA THE GENERAL FUND.
AND WE WANTED TO GIVE YOU SOME, UM, OPTIONS TO, UH, TO AVOID THAT.
AND, UM, SO I'M GONNA WALK YOU THROUGH THOSE, THE FIRST ONE.
AND IN EACH ONE I'LL GIVE YOU AT LEAST A PRETTY GOOD SENSE OF WHAT IT DOES, UH, IN TERMS OF, UH, INCREASING OUR UNASSIGNED FUND BALANCE.
SO THE FIRST OPTION THAT WE'VE LISTED AND, UM, IS REDUCING THE INTER FUND TRANSFERS OUT OF GENERAL FUND TO THE, TO FIELD SERVICES FOR STREETS.
UM, THE FIRST OPTION I'D, I'D OUTLINE IS, UH, A 2.6 MILLION REDUCTION.
AND WE WOULD OFF OFFSET THAT BY USING $2.6 MILLION IN FUND BA FUND BALANCE IN A 2017 CIP.
UH, OBVIOUSLY MOVING TOWARD A POINT AT WHICH THE COUNCIL HAS INDICATED THEY WANT, IT'S THEIR PRIORITY IS, UH, STREET IMPROVEMENTS FOR THAT 2000, UH, NOW 27, UH, CAPITAL DOLLARS.
IF WE REDUCE THAT TRANSFER FROM GENERAL FUND TO FIELD SERVICES FOR STREETS, OFFSET THAT USING 2.6 MILLION OF FUND BALANCE OUT OF THAT 2017 FUND, WE CAN, FIRST OF ALL, WE CAN ELIMINATE THE OPERATING, UH, DEFICIT, BUT THEN SECOND, WE CAN RAISE OUR OVERALL FUND BALANCE TO ABOUT 8.22%.
AND I WOULD SAY DON'T CARVE THOSE PERCENTAGES IN STONE JUST YET BECAUSE OF MAYBE SOME OTHER SMALLER CHANGES, BUT I THINK GIVES YOU A PRETTY GOOD IDEA OF WHAT WE COULD DO.
ANOTHER OPTION THERE WOULD BE TO INCREASE THAT TRANSFER OUT, OR, SORRY, DECREASE THE TRANSFER OUT, UH, BY 3 MILLION, AND THEN USE AN ADDITIONAL, UM, 400,000, UH, OUT OF 2017 CIP FUND BALANCE.
THE SECOND MAJOR AREA OF POTENTIAL REDUCTIONS WOULD BE REDUCING THE TRANSFER FROM THE GENERAL FUND.
UH, FOR CLINK, WE'VE PROPOSED, UH, A REDUCTION BY 495,000 AND CHRISTIE, UH, BATTERSON WILL BE PREPARED IF THE COUNCIL WISHES TO HEAR HOW SHE WOULD ABSORB THAT WITHIN, UH, CITYLINK AND WHAT KIND OF CHANGES THAT MIGHT NECESSITATE.
UH, A SECOND OPTION WOULD BE TO REDUCE THAT BY 1 MILLION, AND A THIRD OPTION WOULD BE TO REDUCE THAT TRANSFER OUT BY 1.495 MILLION.
THERE'S NO QUESTION THOSE LAST TWO WOULD HAVE PRETTY SIGNIFICANT IMPLICATIONS ON THE FUNCTION AND THE SERVICE PROVIDED BY CLINK.
BUT IF WE JUST, UM, IF WE STICK WITH THE 2.6, UM, THE REDUCTION TO, UH, THE TRANSFER TO STREETS, THE 495,000 REDUCTION, UH, TO CITYLINK, THAT MOVES OUR FUND BALANCE TO ABOUT 8.78%.
THEN ONE MORE, UH, THE, WE'VE SHOWN AS AN OPTION REDUCING NON-PROFIT CONTRIBUTIONS BY $250,000.
WE DIDN'T PLAN, UH, WE DIDN'T FOLD THAT INTO ANY PROJECTION FOR, UH, ITS IMPACT ON THE FUND BALANCE, UH, NOT ANTICIPATING WHAT THE COUNCIL MAY OR MAY NOT WANT TO DO.
UM, ANOTHER OPTION IS TO ACTUALLY PROJECT 1% GROWTH IN SALES TAX AT AROUND $850,000.
THAT WOULD MOVE US TO, UH, A FUND BALANCE OF ABOUT OR PERCENTAGE OF ABOUT 9.74%.
AND THEN, UM, AND THEN IF I WENT BACK IN AND ADDED THE OTHER 400,000, MEANING THE, THE DIFFERENCE BETWEEN THE TWO SIX AND THE 3 MILLION, UM, THAT COULD MOVE US TO ABOUT 10.19%.
SO I'LL PAUSE FOR A SECOND TO SEE IF YOU HAVE ANY QUESTIONS ABOUT THAT.
BUT THE POINT BEING IS THAT WE CAN PROBABLY MAKE PRETTY SIGNIFICANT PROGRESS ON YOUR OBJECTIVE
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TO GET TO A LARGER, UH, UNASSIGNED FUND BALANCE IN THE GENERAL FUND, PERHAPS EVEN MOVING TOWARD THAT 10% TARGET DIDN'T WANNA NECESSARILY MAKE ANY ASSUMPTIONS AND BUILD THEM IN YET UNTIL THE COUNCIL HAD A CHANCE TO WEIGH IN ON THEM.AGAIN, YOU DON'T NECESSARILY HAVE TO DO THAT TODAY.
WE'LL HAVE AN OPPORTUNITY IN A FUTURE WORKSHOP TO REVISIT THESE, BUT WANTED TO LET YOU KNOW THAT WE DID LISTEN, WE HAVE GIVEN YOU SOME OPTIONS, AND THEN WE CAN, UH, MAKE SOME ADJUSTMENTS OR PROPOSE SOME VARIATIONS BASED UPON YOUR FEEDBACK.
YOU WANNA START OR YOU WANT ME TO
SO THIS BUDGET, UM, PROJECTS, UH, STILL 6.6, UH, MATT AND KATHY HELPED ME 6.6 MILLION AS A TRANSFER OUT OF THE, UH, OUT OF THE GENERAL FUND, UH, TO ROAD EFFORTS.
AND, AND WE WOULDN'T, UH, WE, WE WOULD JUST REDUCE THAT TRANSFER ROUTE.
WE WOULD MAKE UP THE FUND MAKE UP THE DIFFERENCE.
IF I APOLOGIZE YOUR QUESTION FROM CIP FUND BALANCE, UM, IT'S TOUGH TO GIVE YOU, UM, UH, A A AT A MOMENT IN TIME SPENDABLE FUND BALANCE, BUT THERE'S AT LEAST $12.6 MILLION.
AND I'LL, I'LL, I'LL EXPLAIN THAT.
THERE ARE SOME OTHER PROJECTS THAT HAVE BEEN DELAYED THAT WE'RE NOT COUNTING IN FUND BALANCE, MAYBE, UM, WELL, WELL, UH, SEVERAL MILLION DOLLARS WORTH OF PROJECTS THAT WE AREN'T COUNTING AS AVAILABLE FUND BALANCE.
SO WE HAVE ABOUT $12.6 MILLION IN ROUND NUMBERS AS AN AVAILABLE FUND BALANCE IN THAT 2017 CIP.
IF WE USE 2.6 OF IT FOR, UH, FOR STREET MAINTENANCE, UH, THAT WOULD LEAVE US WITH, UH, WITH 10 MILLION.
SO WE STILL HAVE THE ABILITY, UM, TO IT TO MAKE THE ANTICIPATED ROAD MAINTENANCE PROGRAM THAT WE HAD GONE INTO THE YEAR WITH.
WE'RE JUST USING LESS OF THE GENERAL FUND TO DO IT.
IS THAT OKAY? WHICH MEANS THAT THEN WE'RE GONNA HAVE TO PRIORITIZE OR REPRIORITIZE EVERYTHING FROM CIP P'S PERSPECTIVE TO KEEP ALL THOSE PROJECTS MOVING FORWARD.
Y WELL, YES, EXCEPT FOR WE'RE TAKING IT FROM FUND BALANCE.
SO AS I MENTIONED A SECOND AGO, WE'RE NOT, WE HAVEN'T TAKEN A FUND BALANCE, RIGHT? WE'RE NOT ANYTHING THAT'S BEEN, WE'RE NOT, WE'RE NOT REMOVING PROJECTS FROM THIS LIST.
WE'RE SIMPLY USING FUND BALANCE.
UNOBLIGATED FUND BALANCE TO MOVE IT FORWARD.
AND FOR, FOR THE MOMENT, WE HAVEN'T TOUCHED PROJECTS THAT WERE PREVIOUSLY CONTEMPLATED.
THAT'S WHY I EXPLAINED THE DIFFERENCE.
AND IT'S HARD TO GIVE YOU, UH, A GOOD NUMBER ABOUT SPENDABLE FUND BALANCE BECAUSE WE HAVE, WE HAVE ASSUMED WE WEREN'T TOUCHING ANYTHING THAT HAD BEEN PREVIOUSLY BUDGETED OR PRIORITIZED.
I, UM, I THINK IT'S A GOOD IDEA.
I LIKE MOVING IN THIS DIRECTION.
IT'S CHALLENGING WHEN THE GENERAL FUND ISN'T HUGE, RELATIVELY.
UM, I THINK DOING THIS ONE TIME, THIS 2.6 MILLION ONE TIME TO HELP REBUILD OUR RESERVES IN THE GENERAL FUND IS, IS PROBABLY A SMART THING TO DO.
UM, I'D BE INTERESTED, LIKE, I DON'T REMEMBER, I MIGHT ASK BRAD OR MAYBE THE CAP GROUP TO WEIGH IN SEPARATELY, BUT, UM, YOU KNOW, THE, THOSE RESERVES MAY BE EARMARKED FOR CERTAIN THINGS, CERTAIN PROJECTS ALREADY, PRESUMABLY THEY'RE NOT, IF IT'S TRULY IN THE RESERVE OF THE FUND BALANCE.
BUT, UM, I THINK THAT'S A PRETTY GOOD IDEA TO JUST TRY TO INFUSE A LITTLE BIT OF CASH INTO OUR GENERAL FUND RESERVE ONE TIME.
IT IS SORT OF AN OPERATIONS COST TO ME, SO I WOULDN'T WANT TO PERMANENTLY DO THAT, OR THAT'S LIKE PUSHING OPERATIONS COST INTO, UH, CIP, WHICH I GUESS WE ALREADY DO TO SOME EXTENT BY HOW WE USE IT FOR ROADS.
AND WE PROBABLY WILL CONTINUE TO DO THAT.
BUT IT, I THINK TO THE MAYOR'S POINT LIKE THAT, THAT STARTS TO TAKE MONEY AWAY FROM I THINK, WHAT WE INTENDED FOR IT TO GO TOWARDS ALSO.
UH, SO THE NET WOULD, I THINK, EVENTUALLY COME DOWN IF WE STARTED USING IT FOR OPERATIONS.
SO I WOULDN'T RECOMMEND THAT AS A LONG-TERM THING, BUT I THINK AS A ONE-TIME TARGETED THING TO BOOST OUR GENERAL FUND RESERVES, THAT'S A PRETTY SMART IDEA IN MY OPINION.
CAN, CAN I JUST WEIGH IN QUICKLY? SURE.
SO, UM, WE'RE JUST AMONG FRIENDS HERE HAVING A CHAT, RIGHT?
UH, THAT'S HOW WE WOULD VIEW IT IS, UM, THERE ARE A HANDFUL OF THINGS WE'RE GONNA TALK ABOUT, I THINK THROUGHOUT THE COURSE
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OF THIS BUDGET THAT AREN'T NECESSARILY THINGS THAT WE WANNA REPLICATE YEAR OVER YEAR.WE DON'T WANT TO GO INTO EVERY YEAR ANTICIPATING BEING FLAT IN REVENUES.
WE DON'T WANT TO GO INTO EVERY YEAR TELLING DEPARTMENT DIRECTORS THEY'VE GOTTA REDUCE, UM, OPERATING COSTS.
BUT I THINK WE'RE, WE ARE FORCED TO CONSIDER A HANDFUL OF THINGS THAT, I DON'T WANT TO CALL 'EM TRULY ONE-OFFS.
'CAUSE THERE MIGHT BE A COUPLE THINGS THAT WE WOULD SAY, HEY, WE LIKE THE WAY THAT WORKED AND THAT'S A GOOD OPTION GOING FORWARD.
AND WE MIGHT NOT NECESSARILY HAVE EXHAUSTED EVERY OPTION AT THIS POINT, BUT IT'S IN THAT, IT'S IN THAT SPIRIT IN THAT VEIN THAT YOU JUST DESCRIBED, THAT WE'RE TRYING TO MANAGE IT FOR THIS YEAR AND JUST GIVE THE COUNCIL, UH, SOME OPTIONS.
I WOULD SUGGEST THAT WE HAVE THE CIP BOARD WEIGH ON THAT TOO, LIKE I SAID, AND I DON'T KNOW IF BRAD WANTS SAY ANYTHING NOW OR, OR NOT, BUT I THINK THEY OUGHT TO.
I MEAN, THAT'S THE POINT OF THAT BOARD, RIGHT? IS HOW THAT MONEY GETS SPENT TO RECOMMEND THINGS.
SO I WOULD RECOMMEND, SO I, I'D LIKE TO HEAR FROM MS. BATTERSON, I'M ASSUMING SHE'S OUT THERE SOMEWHERE THERE SHE IS ON THE IMPACT TO, TO CITYLINK AND, 'CAUSE I KNOW THAT, THAT YOU'VE BEEN DISCUSSING MULTIPLE OPTIONS THERE, UM, ON TOP OF THAT 495,000.
SO, AND, AND BEFORE CHRISSY GETS UP HERE, I AGREE ON THAT, THAT'S A BIG CHUNK FROM THAT TOTAL.
BUT, BUT ALSO IMPORTANTLY TO ME, I'D LIKE TO HEAR THE, UH, I'M ALL FOR THE, THE 2.6 TRANSFER.
IF OUR GOAL IS TO GET RESERVES HIGHER, IT MAKES SENSE.
I'M A LITTLE WORRIED WE'RE BETTING ON THE COME 1% INCREASE IN, UH, YOU KNOW, WHAT HAPPENS WITH SALES TAX AND SO FORTH.
I HAVEN'T SEEN US REALLY ENACT ANYTHING THAT'S GONNA MAKE THAT HAPPEN.
SO WE'RE, WE'RE, WE'RE JUST BETTING ON A RISE FROM PEOPLE SPENDING MONEY AND, UH, THAT IF YOU'VE SEEN, THAT'S KIND OF BEEN THE CRITICISM.
WE TALK ABOUT IT AND WE TALK ABOUT IT AND THEY SAY, PEOPLE IN EDMOND NEVER DO ANYTHING BUT TALK ABOUT IT.
I ALSO WANT TO HEAR ABOUT THE TWO 50 REDUCTION IN THE NON-PROFIT CONTRIBUTIONS IN THAT I DON'T REALLY FEEL LIKE IT, IT MOVES THE NEEDLE.
AND SO LET'S BALANCE THAT A LITTLE BIT AGAINST WHAT DOES THAT MEAN TO PEOPLE WHO NEED THAT WITHIN OUR COMMUNITY.
CHRISTIE BATTERSON, DIRECTOR OF HOUSING AND COMMUNITY RESOURCES.
MS. BATTERSON, BEFORE YOU START, PLEASE.
WHEN YOU GET TO THAT, THE, THE, THE REDUCING THE, THE NON-PROFITS, I MEAN, I'M NOT FOR THAT, BUT I WOULD LIKE TO HEAR WHAT THE QUESTION TO MR. FRAMES OR THE ANSWER TO HIS QUESTION.
DO YOU WANT THAT FIRST? DO YOU WANT ME TO TALK ABOUT CITYLINK? OKAY.
UM, SO CITYLINK, THE 495,000, WE ARE, UM, RECEIVING A GRANT, S-T-V-G-U-Z-A FROM ODOT THROUGH FTA FOR THE, UH, REPLACEMENT OF VEHICLES.
UM, WE DO HAVE A CITYLINK FLEET FUND.
SO INSTEAD OF IT COMING STRAIGHT FROM GENERAL FUND, WE WOULD RE, WE WOULD TRANSFER THAT OUT OF THE FLEET FUND.
UM, WE WOULD BE REIMBURSED 80% FOR THE SIX VEHICLES THAT WE WOULD BE REPLACING.
WE ALSO CAN, UM, CON UH, DISTRIBUTE THAT OVER MULTIPLE YEARS FOR THREE YEARS.
UM, SO I DON'T HAVE TO DO IT ALL NEXT YEAR.
UM, SO THAT'S HOW THAT 4 95, I DON'T KNOW IF YOU WANT ME TO GO AHEAD AND DISCUSS WHAT THE 1000001.4 IS.
I CAN DISCUSS THOSE OPTIONS AS WELL, WHAT THAT IMPACT WOULD BE.
THE 1 MILLION THAT WOULD BE A REDUCTION IN SERVICE, SO THE MILLION AND THE 1.4, UH, THE 1.4 WOULD BE A REDUCTION SERVICE PLUS THE 4 95.
SO THE 1 MILLION WOULD BE A REDUCTION IN SERVICE.
UM, WE WOULD BE REDUCING OVER 20% OF OUR SERVICE, MEANING THAT WE WOULD GET RID OF, WE WOULD HAVE TO ELIMINATE OUR ONE HUNDREDS COM 100 X COMMUTER ROUTE, AND THAT'S A ROUTE THAT GOES DOWN TWICE A DAY TO OKLAHOMA CITY MONDAY THROUGH FRIDAY.
UM, WE ARE ALSO WOULD PROPOSE TO REDUCE OUR SERVICE 12 FROM 12 HOURS A DAY TO 10 HOURS A DAY.
SO THAT'S AN HOUR IN THE MORNING AND AN HOUR IN THE EVENING MONDAY THROUGH FRIDAY.
AND THAT'S ALSO ELIMINATING A BUS ON ROUTE SIX.
SO INSTEAD OF RUNNING EVERY 30 MINUTE FREQUENCY FOR ROUTE SIX, IT WOULD BE AN HOUR.
UM, AND IT WOULD ON ROUTES ONE THROUGH FIVE, IT WOULD JUST BE, IT WOULD STILL BE 30 MINUTE FREQUENCY.
UM, BUT ROUTE SIX WOULD GO TO A ONE HOUR.
UM, WE ANTICIPATE THESE COSTS BEING A LITTLE OVER $700,000 PLUS FUEL.
UM, AND THEN IF YOU ADD IN THE 4 95, UH, FOR VEHICLES, THAT WOULD TAKE US OVER THE MARK FOR CITYLINK.
UM, ANY REDUCTION IN SERVICE DOES REQUIRE A PUBLIC OUTREACH, UM, PUBLIC COMMENT, NEWSPAPER LEGAL NOTICE, UM, AND TWO PUBLIC HEARINGS.
UH, THE NONPROFIT, UM, YOUR, THE ORDINANCE THAT OVERSEES THE COMMUNITY AGENCY REVIEW COMMISSION OR
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ARC, UM, DOES SAY UP TO $1 MILLION.SO IT IS YOUR DISCRETION RATHER TO DO THAT ONE FULL MILLION DOLLARS OR A REDUCED EFFORT IF NEEDED.
UM, OUR APPLICATION PROCESS CLOSES THIS FRIDAY SO FAR, WE HAVE ABOUT 10 APPLICANTS.
UM, THE NEEDS IN THE COMMUNITY ARE STILL THE SAME OF WHAT WE HEAR, UM, ON A CONSISTENT BASIS.
RENTAL ASSISTANCE, UTILITY ASSISTANCE, FOOD INSECURITY, UM, ESPECIALLY WITH OUR SENIOR POPULATION.
UM, WE'RE SEEING AN INCREASE IN, UH, MEALS, WHICH, UM, YOU HEARD LAST TIME WHEN I BROUGHT, UH, THE, UH, CONTRACT WITH EVAN MOBILE MEALS THAT THEY'VE INCREASED NOT ONLY AT THE SENIOR CENTER THEIR MEALS, BUT THEIR DAILY DELIVERY.
WE'VE HAD AN INCREASE IN EVICTION IN THROUGHOUT THE CITY, UM, WHICH HAS ASKED FOR AN INCREASE IN RENTAL ASSISTANCE.
SO I CAN'T REALLY GIVE YOU A NUMBER OF THAT WOULD IMPACT, UM, BUT IT WOULD BE AN IMPACT, UM, TO THOSE ORGANIZATIONS THAT PROVIDE THOSE SERVICES.
UM, I DON'T KNOW IF I'M SPEAKING FOR EVERYONE, BUT I THINK WE COULD PROBABLY TALK, CALL, CALL THAT TWO 50 FOR NON-PROFITS AND NON-STARTER AND JUST, LET'S JUST GET IT OFF THE, THE TABLE RIGHT NOW.
I DON'T, I DON'T THINK THERE'S ANYBODY UP HERE WHO'S ENDORSING ANYTHING LIKE THAT.
WELL, IF I MAY, JUST BEFORE THE HEADLINE BECOMES CITY MANAGER PROPOSES CANCELING CHRISTMAS
I THINK WE CAN FIND MULTIPLE OTHER WAYS TO MAKE THIS BUDGET WORK WITH, WITHOUT TOUCHING THAT PIECE OF IT.
UM, BUT I THINK IT DOES DEMONSTRATE THE SERIOUSNESS OF WHERE WE WERE SITTING TODAY, UM, AFTER WHAT WE'VE SUFFERED THROUGH THE LAST THREE FISCAL YEARS NOW WITH OUR REVENUE LEVELS.
WHAT, YES, CHRISTY, UH, COULD YOU AT SOME POINT PROVIDE INFORMATION TO, TO ME OR TO US ABOUT RIDERSHIP AND, AND WHAT THAT'S LOOKING LIKE? UM, I WANT US TO HAVE A ROBUST, A ROBUST TRANSPORTATION SYSTEM BECAUSE THE MORE THAT IT'S CONSISTENT AND RELIABLE, THAT'S HOW PEOPLE CHOOSE TO RIDE ON IT.
SO I WOULD WANT TO BE REALLY, UM, INTENTIONAL BEFORE REDUCING, EVEN CONSIDERING REDUCING, UM, ROUTES OR DURATION.
SO SURE THING, I, I HAVE THAT AND I APOLOGIZE FOR NOT PROVIDING THAT.
UM, BUT WE DO HAVE MONTHLY RIDERSHIP NUMBERS.
I CAN EVEN BREAK IT DOWN PER ROUTE.
I WILL SAY OUR PARATRANSIT, WHICH IS OUR DOOR TO DOOR, HAS EXPONENTIALLY BEEN GROWING.
AND I FORGOT TO MENTION, UM, NOT ONLY DO WE HAVE THE GENERAL FUND, UH, TRANSFER, BUT WE ALSO RECEIVE FEDERAL FUNDS FOR THIS.
SO OUR OPERATIONS COST IS A 50 50 SPLIT AND OUR MAINTENANCE COSTS ARE 80 20.
SO TYPICALLY WE GET A LITTLE OVER A MILLION DOLLARS AND OUR FT FUND, FTA FUNDS BACK, WE ALSO HAVE SOME ODOT FUNDS THAT WE RECEIVE AND ACOG FUNDS THAT WE RECEIVE.
AND THEN WE JUST, UM, LIKE I SHARED WITH YOU LAST WEEK, WE JUST RECEIVED AN ADDITIONAL ACOG GRANT, UM, FOR AN ADDITIONAL ROUTE, UM, OUT TO THE CONFERENCE CENTER.
UM, BUT THOSE COSTS WOULD BE OFFSET WITH THAT GRANT.
YEAH, I DON'T, I DON'T SUPPORT CUTTING THE NONPROFITS RIGHT NOW.
CAN'T BELIEVE YOU WOULD EVEN SUGGEST THAT.
UH, I, I DON'T THINK WE NEED TO REDUCE OUR SERVICE EITHER.
CAN, SORRY, CAN YOU SAY THE MECHANICS OF THE 4 95 SAVINGS AGAIN, I DIDN'T TOTALLY FOLLOW YOU.
THAT'S ACTUALLY A GRANT THAT WE RECEIVED FOR THE REPLACEMENT OF VEHICLES.
UM, AND SO THAT WOULD BE APPROXIMATELY OUR PORTION OF THE, OR ACTUALLY IT'S THE INITIAL ORDERING OF THE BUS.
SO IT'S ABOUT A $1 MILLION GRANT.
UH, THE 500,000 WOULD BE WHAT WE WOULD, I WAS NEEDING FOR CAPITAL NEXT YEAR.
UM, AND SO WE WOULD JUST TRANSFER IT OUT OF MY CITYLINK VEHICLE FUND INSTEAD THAT'S RESTRICTED FOR VEHICLES AND DELAY THOSE PURCHASES OR WHAT WE CAN DELAY THOSE PURCHASES.
WE HAVE THREE YEARS FROM THE TIME THAT WE RECEIVE THE AGREEMENT, WHICH I'VE BEEN BUGGING ODOT FOR BECAUSE WE, WE WON THIS GRANT BACK IN 20, UH, FALL OF 24 AND WE'RE JUST NOW RECEIVING THOSE, UM, FUNDS BECAUSE IT WAS IN THE 26TH APPROPRIATION.
I'M INTERESTED IN THE RIDER METRICS AS WELL AND THE PARATRANSIT.
I DON'T KNOW IF A LOT OF PEOPLE KNOW THAT WE DO THAT AS A CITY, BUT I THINK IT'S ONE OF THE COOLEST THINGS WE DO AND IT'S PROBABLY GONNA GET EVEN MORE USED AS OUR COMMUNITY AGES, INCLUDING ME.
SO LIKE, I THINK THAT'S SOMETHING THAT WE WANT CONTINUE DOING.
SO, UM, ANYWAY, I THINK THAT'S A NEAT THING AND SOMETHING WE SHOULD HIGHLIGHT AND CONTINUE DOING.
IT SOUNDS LIKE THE VEHICLE THING IS SMART JUST FROM THE WAY YOU'RE SAYING IT, BOTH OF YOU.
SO, UM, THAT SOUNDS LIKE A REASONABLE SUGGESTION TO ME.
AND AS I SAY, YOU DON'T HAVE TO MAKE THE FULL ON CALL TODAY.
[00:30:02]
THE MAYBE SOME OTHER FUNDS AS WELL.THE ONLY OTHER POINT I WOULD MENTION BEFORE WE MOVE ON TO SOME OF THE OTHER FUNDS IS, UM, THE INITIAL DIRECTION THAT WE PROVIDED TO THE DEPARTMENTS IS NO NEW VEHICLE PURCHASES IN 26 27.
UM, I WAS, UH, I I DID QUICKLY FOLLOW THAT UP WITH IF THERE'S AN UNUSUAL CIRCUMSTANCE OR IF NOT PURCHASING A NEW VEHICLE WOULD PROVIDE SOME, UH, WOULD BE A REAL IMPEDIMENT TOWARD MEETING OUR OBLIGATIONS OR PROVIDING A REQUIRED SERVICE, THEN LET'S TALK BUT WANT TO GO INTO THE YEAR, UH, ASSUMING THAT WE WON'T PURCHASE ANY, THE CITY WON'T PURCHASE ANY NEW VEHICLES IN 26, 27.
AND THEN IF, IF IT WINDS UP NOT BEING THE CASE, I'LL LET YOU KNOW ON, UH, ON A SPECIFIC BASIS WHERE THOSE FUTURE PURCHASES WOULD COME FROM.
CAN, CAN WE GET A, AN EXPLANATION ON THAT? THAT LAST LINE SALES TAX GROWTH? UM, WE FINISHED PAYING BACK TAX COMMISSION, CORRECT.
AND SO WHAT IS OUR ANTICIPATION WITH SALES TAX AND USE TAX OVER, OVER THE NEXT YEAR NOW THAT THAT'S BEHIND US AND WE CAN ACTUALLY SEE WHAT'S HAPPENING? AGAIN, WE DO EXPECT, YOU KNOW, WHEN WE, WE, AND WE ADJUST IT FOR THAT REPAYMENT, WE WOULD BE COMING CLOSER TO A 1%, HOPEFULLY BY THE END OF THIS FISCAL YEAR.
UM, JUST GONNA HAVE TO WATCH IT, YOU KNOW, DAY BY DAY THE THINGS THAT YOU READ STATEWIDE AND EVEN IN OTHER STATES, PEOPLE ARE ALL PRETTY MUCH BUDGETING PRETTY LOW ON THAT TYPE OF THING.
I WOULDN'T SAY MAYBE ZERO ALWAYS, BUT THERE ARE SOME THAT ARE BUDGETING ZEROS.
OBVIOUSLY THAT WOULD BE THE CONSERVATIVE APPROACH TO TAKE.
UM, WHEN I RUN IT THROUGH THE WAY THAT WE ARE, ARE SPENDING HABITS IN EDMOND, AND I HAVE THE, THE FORMULAS I USE TO ANTICIPATE THAT I'M COMING RIGHT AT MAYBE ZERO TO 1%, SOMEWHERE IN BETWEEN THERE BY THE END OF 26, BY THE END OF 27, IT'S ALWAYS GONNA DEPEND ON CONSUMER CONFIDENCE AND, UH, WE STILL ARE GROWING, BUT THAT'S NOT BEEN KEEPING UP WITH OUR SALES TAX.
SO I WOULD PROBABLY SAY 1% GROWTH IS PROBABLY DOABLE BY THE END OF 27.
AND CAN I JUST TAG ON, WE JUST DID 1% FOR JUST, ITS SHEER SIMPLICITY.
MAYBE IT'S THREE QUARTERS OF A PERCENT, MAYBE IT'S A HALF A PERCENT, WHATEVER IT MIGHT BE.
WE JUST GAVE YOU 1% FOR ITS SIMPLICITY AND TO HELP YOU FIGURE OR HELP YOU SEE WHAT ABOUT WHAT IT REPRESENTS, UH, IN TERMS OF THE WHOLE BUDGET.
SO, WELL, LEMME SEE IF ANYBODY ELSE HAS ANY QUESTIONS BEFORE WE, SO IF WE DID THAT FIRST ONE, THE 2.6 MILLION AND THE 400,000, AND LET'S SAY WE DID THE CITYLINK, WE DIDN'T DO NONPROFIT, AND LET'S SAY WE DID A HALF A PERCENT ON SALES TAX GROWTH, WHAT DOES THAT LOOK LIKE? UM, LET ME THINK OUT LOUD HERE FOR A SECOND.
THE FIRST TWO, THE, UH, THE IMPACT IN TERMS OF A PERCENTAGE OF FUND BALANCE, IS THAT WHAT YOU'RE ASKING? YES, YES.
SO THE, THE NET EFFECT OF THE TWO SIX GETS US TO ABOUT 8.2%.
IF YOU ADD IN THE CITY LINK 495,000, UM, THAT'S ABOUT 8.78%.
UM, IF WE DID THE FULL EIGHT 50, THAT WOULD TAKE US TO ABOUT 9.74%.
SO IN SIMPLE MATH, LET'S CUT IT IN HALF.
AND LET'S SAY THAT GETS US TO ABOUT A 9.2.
IT MAY BE HIGH 19 MAYBE, UH, BUT IT'S NINE POINT EITHER HIGH TEENS OR LOW TWENTIES.
SO FOR SIMPLICITY, I'LL SAY ON THE FLY 9.2.
ANY OTHER QUESTIONS? WE'RE GONNA TALK MORE ABOUT THE, THE CITY LINK AND OTHER THINGS AT ANOTHER MEETING.
YEAH, I'M NOT, YEAH, I WANNA TALK MORE ABOUT IT.
I THINK IT 4 95 SEEMS A LITTLE HIGH, BUT YEAH, I MIGHT TO SHARE A DATA POINT ON THE BOTTOM LINE THERE.
SO I ASKED EARLIER, LIKE WHAT IF WE UPDATED OUR CURRENT
[00:35:01]
YEAR TO DATE.YOU SAW IT IN EMAIL, UH, CURRENT YEAR TO DATE SALES TAX OR I GUESS OVERALL REVENUE, NOT SALES, TAX REVENUE, UM, ADJUSTING FOR THE REPAYMENT THING, YOU KNOW, KIND OF REMOVING THAT.
I THINK IT WAS 0.76 IS WHAT YOU MATT SAID.
SO LIKE YEAR TO DATE GROWTH IS 0.76, ADJUSTED FOR THAT, UH, WHICH IS MORE OF THE TRUE NUMBER TO ME.
UH, SO IT GIVES ME A LITTLE MORE CONFIDENCE, YOU KNOW, THAN ZERO THAT MAYBE A HALF PERCENT OR SOMETHING MIGHT BE A REASONABLE ASSUMPTION.
UM, AS LONG AS IT GOES TO RESERVES.
THE TEMPTATION WOULD BE TO, TO SPEND IT.
SO WE HAVE THE TEMPTATION IS ALWAYS TO JUST THROW IT BACK INTO THE BUDGET AND, YEAH.
WELL JUST TO YOUR LAST POINT, UM, IF WE ELIMINATE THE 1.278 MILLION, $1.278 MILLION, UH, DOLLARS WORTH OF DEFICIT SPENDING AND DID NOTHING MORE THAN THE TWO SIX, THEN WE'D BE AT, UH, A SURPLUS OF A ROUND NUMBER 1.3.
AND SO AT THAT POINT, THAT WOULD BE FUND BALANCE BARRING SOMETHING UNFORESEEN THAT MIGHT HAPPEN DURING THE COURSE OF THE YEAR, BUT WE COULD BUDGET, UH, FOR US ADDING TO OUR OVERALL FUND BALANCE.
THAT'S ANOTHER THING I WANTED TO COMMENT ON TOO, JUST FOR US, MAYBE I SAID THIS IN A PREVIOUS MEETING, BUT FOR FINANCE COMMITTEE FUND BALANCE 5.28, SO THAT'S THE PROJECTION OF WHERE WE'LL BE AS OF JUNE 30TH OF THIS YEAR, CORRECT.
OH, NEVERMIND MY COMMENT THEN, UH, OR I'LL MAKE IT ANYWAY, WE, SOMETIMES IT'S HARD FOR US TO SEE WHEN WE'RE MAKING, WHEN WE'RE APPROVING COUNCIL LINE ITEMS, WHERE THEY'RE COMING FROM.
AND SO, UM, IF ANYBODY'S READING THE PACKET AS CLOSELY AS WE ARE, YOU'LL NOTICE AT THE BOTTOM THE FUND NAME IS NOW MORE SPECIFICALLY CALLED OUT SO THAT WE KNOW WHEN WE MAKE DECISIONS, IF IT'S COMING OUTTA THE GENERAL FUND, AND ESPECIALLY IF IT'S COMING OUTTA THE GENERAL FUND RESERVE, THAT THAT'S IMPACTING OUR RESERVE BALANCE.
AND THAT MAY SEEM OBVIOUS TO EVERYBODY, BUT IT'S NOT OBVIOUS FOR US TO SEE ALL THE TIME.
SO WE MAKE DECISIONS AND LIKE, YEAH, THAT'S A GOOD IDEA OR WHATEVER, UM, WITHOUT REALLY UNDERSTANDING WHERE THAT MONEY'S COMING FROM SOMETIMES.
SO I THINK THAT'LL HELP US, UH, JUST TO UNDERSTAND THAT BETTER GOING FORWARD.
SO THANKS FOR ADDING THAT TO COREY AND YOU AND OTHERS WHO ADDED IT.
CAN I ASK ONE MORE QUESTION ON THE, UM, BACK TO GENERAL FUND, FIRST SLIDE, SLIDE FOUR ON THE, UM, ON THE PERSONAL EXPENSES.
JUST, JUST WANNA UNDERSTAND THE ASSUMPTIONS THERE A LITTLE BIT.
THE 3.22 THAT'S INCLUSIVE OF BENEFITS, CORRECT? YES.
AND THEN HAVE WE NAILED DOWN WHAT THE, THE PENSION CONTRIBUTIONS ARE GONNA BE TO THE STATE THIS YEAR? YES.
SO IT ACCOUNTS FOR THAT ALREADY.
SO IN YOUR, UH, INDEPENDENT CONTRIBUTIONS FOR PUBLIC SAFETY.
UM, SO IT'S ABOUT, SO FOR, UM, I DON'T ACTUALLY CARE WHAT THE NUMBER IS, I JUST WANNA KNOW IF IT'S A VARIABLE OR IF WE KNOW WHAT IT'S GONNA BE.
SOUNDS LIKE, OH, WELL WE KNOW WHAT IT'S GONNA BE.
NOW UNLESS, BECAUSE THEY TELL US WHAT IT'S GONNA BE, RIGHT? YES.
AND I'M NOT AWARE UNLESS SOMEBODY ELSE IS, THAT THEY'VE RENEGOTIATED THAT, UM, WITH THE PENSION, THAT'S THE STATE PENSION THAT I'M TALKING ABOUT.
I JUST WANNA KNOW IF IT'S AN OPEN, LIKE A RISK ITEM OR NOT TO ALL THIS.
IF WE'RE ASSUMING SOMETHING OR IF WE KNOW WHAT IT'S GONNA BE.
HELLO, JD YOUNGER, YOUR POLICE CHIEF MM-HMM
UH, ACTUALLY SENATE BILL SEVEN 16 IS STILL ACTIVE AND THAT WOULD INCREASE, UH, THE PENSION, UH, CONTRIBUTION BY THE CITY BY UP TO 2%.
UH, I'VE SEEN NEGOTIATIONS TO BRING IT DOWN TO 1%.
I'VE ALSO SEEN, UH, SOME COVERAGE THAT MAY BE ELIMINATED OR DEALT WITH OTHER WAYS, BUT YES, TO YOUR, TO YOUR POINT, UH, THAT IS A LIABILITY OR A RISK, UH, MEASURE OUT THERE.
SO WE'RE TRACKING THAT TO SEE, UH, WHAT THE IMPACT WOULD BE.
IS THAT, AND THAT'S JUST FOR POLICE? FOR POLICE, OKAY.
ANYTHING UNIQUE FOR YOURS? MAYOR COUNSEL? TERRY ESRI, I'M YOUR FIRE CHIEF.
UH, THE FLAT RATE FOR FIRE IS RIGHT AT ABOUT 14% FROM THE EMPLOYER.
AND YOU EXPECT IT TO STAY THAT WAY AS OF RIGHT NOW? YES, SIR.
SO THERE'S SOME, I MEAN, JUST SOMETHING TO KEEP IN MIND, RIGHT.
AS AN OPEN ITEM POTENTIALLY THAT WE MAY HAVE A LITTLE BIT OF RISK ON GOING FORWARD.
OKAY, ANY OTHER QUESTIONS? CARRY ON.
OKAY, SO NOW WE'RE MOVING INTO FIRE AND POLICE.
WE SHOULD JUST KEEP THE CHIEFS UP HERE,
BUT BASICALLY THIS IS JUST WHERE WE ARE,
[00:40:01]
UH, BUDGETED RIGHT NOW.SO, UM, ABOUT 7.2 COMING IN, THIS IS FIRE.
THEY GET A HIGHER PERCENTAGE OR A HIGHER DOLLAR AMOUNT THROUGH THE DEDICATED SALES TAX, AND THEN THEY GET A LESSER AMOUNT TRANSFERRED FROM GENERAL FUND THAN, THAN POLICE DO.
SO WE'RE ESTIMATING ABOUT 7.2 MILLION IN ALL OF THEIR REVENUE SOURCES.
UH, TRANSFERS IN OF ABOUT 25 MILLION USE OF FUND BALANCE, ABOUT 4.5 MILLION.
SO THEIR TOTAL SOURCES ARE 36.7.
THE EXPENSE SIDE, MOST OF THEIR EXPENSES ARE, ARE IN THEIR PERSONAL SERVICES.
UM, AND SO ONCE AGAIN, THEIR TRANSFERS OUT ARE MAINLY THEIR FLEET, THEIR ADMIN, ADMINISTRATIVE SUPPORT, BUT THEIR TOTAL USES ARE THE 36.7 MILLION.
AND THEN THEIR FUND BALANCE IS BEING USED UP IN 27.
WE HAVE BEEN TALKING AND DISCUSSING ON WHAT, ON WAYS THAT WE COULD ADDRESS THIS, BUT RIGHT NOW, AS IT SITS IN OUR BUDGET, THEY WILL STILL HAVE A POSITIVE, UH, FUND BALANCE AT THE END OF 27 OF ABOUT $400,000.
DO YOU WANT TO ASK ANY QUESTIONS AT THIS POINT OR MOVE ON TO POLICE? JUST, JUST FOR CLARIFICATION, KATHY? YES.
UM, ON BOTH THOSE TWO PREVIOUS SLIDES WHERE YOU, WHERE YOU TALK ABOUT REVENUE AND EXPENSES, THAT VERY FIRST LINE THAT SAYS TAXES MM-HMM
WHICH TAXES IS THAT? IT'S SALES TAX.
SO IT IS THE, UH, DEDICATED SALES TAX.
SO THAT'S THE FOR FIRE, THAT WOULD BE THE FIRE SALES TAX FIRE DEDICATED SALES TAX, YES.
PLUS IT'S PLUS PLUS GENERAL FUND TRANSFER.
UH, THAT'S THE 25 MILLION IN INNER FUND TRANSFERS IN.
SO THAT'S 30% OF THE GENERAL FUND REVENUE IS THE 25 MILLION.
AND THEN THE TAXES IS, IS PART OF OUR TOTAL 3.75 LOCAL RATE THAT IS FIRES, PERCENT OF THAT, THAT GOES DIRECTLY TO FIRE PUBLIC SAFETY, THEN THE REST ARE GRANTS AND YOU KNOW, TICKETS AND THAT KIND OF THING.
SO DOES THE COMBINATION OF, ON SLIDE 11, DOES THE COMBINATION OF SPENDING THE FUND BALLOT, I'M TRYING TO FIGURE OUT, IS THIS A NET 9 MILLION MORE THAN LAST YEAR WHEN YOU COMBINED THE A NET NINE FUND BALANCES? OR IS THAT THE SAME THING? E EITHER WAY, LIKE GETTING DOWN TO A 400 K RESERVE FOR FIRE SEEMS PRETTY RISKY TO ME AND IT SEEMS UNSUSTAINABLE
UM, I KNOW WE GOTTA DO STUFF, BUT I THINK WE NEED TO TAKE ANOTHER LOOK AT THAT.
IT'S LIKE 1% OF REVENUE OR SOMETHING.
SO I GUESS JUST TO BACKTRACK A LITTLE BIT TOO, AT THE END OF 25, AUDITED FUND BALANCE WAS ABOUT 15 MILLION, BUT THEY DID THE FIRE DEPARTMENT PAID FOR FIRE STATION NUMBER SIX MM-HMM
AND, UM, THAT, SO THAT WAS A LARGE DRAIN ON, ON THE FUND BALANCE.
AND THEN 26 IS TRICKY ALWAYS BECAUSE WE'RE STILL IN THE MIDDLE OF 26 FISCAL YEAR AND 6 3 26, SO WE'RE STILL ANTICIPATING WHAT WE'RE GONNA PAY, WHAT WE'RE GONNA BUY.
AND THERE ARE SOME, SOME CAPITAL OUTLAY ITEMS IN THERE.
SO THE, THOSE CAN STILL BE LOOKED AT IN FISCAL YEAR 26.
BUT THAT'S ALL IN THIS RIGHT NOW.
THERE'S A VEHICLE MAINTENANCE BUILDING, THERE'S SOME CAPITAL OUTLAY IN THERE, AND THEN 27 WE ALWAYS JUST ROLL FROM 26.
AND, UM, THAT'S WHAT YOU START WITH AND THAT'S THE 4.9.
SO IT'S AFTER SOME PRETTY GOOD SIZED CAPITAL OUTLAY THAT THE FIRE DEPARTMENT HAS PAID FOR.
AND THEN, UM, THE, THE 4.5 MILLION THAT'S BEING USED IS JUST A DIFFERENCE BETWEEN THE REVENUE COMING IN AND THE EXPENSES GOING OUT IN FISCAL YEAR 27.
SO CHIEF, DO YOU WANNA TALK TO THIS? UH, IT'S, WELL THE, WHILE HE IS COMING UP THERE, THIS WAS, UM, UH, THIS SORT OF JUMPED OUT WAS AS WE WERE GOING THROUGH FIRST PASS OF THE, UH, DEPARTMENTS, SETTING ASIDE THE FUNDS FOR THE MOMENT, THIS JUMPED OUT.
UM, UH, AS WE'RE REVIEWING DEPARTMENTS, IT, IT, IT LOOKS A LITTLE BIT WORSE THAN IT ACTUALLY IS.
AND THAT'S A FUNNY THING TO SAY BECAUSE THERE HAVE BEEN A LOT OF, AS KATHY WAS JUST ALLUDING TO, UM, SPENT CAPITAL OUT OF THAT FUND BALANCE
[00:45:01]
AND THEN ANTICIPATED, UH, OR BUDGETED, UH, UH, SPENT CAPITAL OR CAPITAL TO BE SPENT, UM, THE 25 26 ADOPTED BUDGET HAD THE FUND DEFICIT SPENDING SOMEWHERE AROUND $7 MILLION.UM, I THINK TO THE CHIEFS AND THE DEPARTMENT'S CREDIT THAT NUMBER, UH, FOR 25, 26, AS KATHY WAS JUST ALLUDING TO, IT'S A LITTLE BIT OF A WORK IN PROGRESS, BUT IT'S PROBABLY REDUCED TO AROUND FIVE AND CHANGE MILLION.
BUT STILL, UM, UH, WE, WE OBVIOUSLY CAN'T CONTINUE TO DEFICIT SPEND THERE.
SO IT PROBABLY LURKS LOOKS A LITTLE BIT WORSE IN A, IN A LIMITED SNAPSHOT THAN IT, OR MAYBE A LITTLE LESS MANAGEABLE.
MAYBE LET ME PHRASE IT AS A POSITIVE.
I THINK IT'S PROBABLY IN THE RELATIVE SHORT TERM, A LITTLE MORE MANAGEABLE THAN IT APPEARS.
BUT THE UNDERLYING PROBLEM IS INESCAPABLE.
THERE'S NOT ENOUGH REVENUE GOING INTO, UH, PUBLIC SAFETY ON EITHER SIDE, I THINK FOR THE, FOR A LONG TERM VIEW OR THERE'S MORE EXPENSES THAN WE CAN AFFORD.
THIS TO, TO SPEAK ON THIS, THIS KEEPS ME UP AT NIGHT JUST AS I'M SURE AFTER SEEING THIS, IT'S GONNA KEEP YOU UP AT NIGHT.
AND, UM, AND, AND OF COURSE AS WE LOOK FOR OUR CURRENT BUDGET, WE'RE LOOKING FOR WAYS THAT WHERE WE CAN FIND EFFICIENCIES WITHOUT, UH, SACRIFICING ANY SERVICES TO OUR CITIZENS AND MAKING SURE WE DON'T SACRIFICE HEALTH AND SAFETY TO OUR FIREFIGHTERS.
UH, BUT THERE'S JUST NOT MANY WAYS OR PLACES TO CUT.
UH, BUT WE'RE CONTINUE TO DO THAT AND CERTAINLY LOOKING TO NEXT YEAR AS WELL.
THERE'S SOME CAPITAL ITEMS ON THE, UH, ON THE OUTLAY FOR NEXT YEAR.
BUT THERE ARE THINGS LIKE, UH, BREATHING APPARATUS, THINGS THAT WE HAVE TO HAVE JUST TO OPERATE, UH, JUST TO SERVE AND TO PROTECT OUR PEOPLE.
SO, UH, OUTSIDE OF THOSE WE'RE, WE'RE GONNA SHUT DOWN ALL SPENDING THAT WE DON'T ABSOLUTELY HAVE TO HAVE.
BUT YEAH, THIS IS VERY CONCERNING AND, UH, WE'RE DEDICATED TO FIND A WAY THROUGH IT.
SO DO YOU EXPECT AN UPDATE TO THIS SLIDE TO ONCE YOU GUYS DIG IN A LITTLE MORE? I DON'T THINK WE, I DON'T KNOW WHAT THE CHIEF'S WAITING ON.
PART OF IT TO ME IS ALSO LOOKING AT THE FIVE YEAR PLAN.
AND I KNOW WE DID THAT LAST YEAR I DID WITH CHAD BEFORE YOU WERE HERE AND, AND, UM, IT PROJECTED A NEGATIVE BALANCE AT SOME POINT, WHICH WE ALL SAID, WELL, WE'RE NEVER, WE'RE NEVER REALLY GONNA DO THAT.
AND THEN, YOU KNOW, I MEAN,
SO, SO I THINK, I THINK WE NEED TO LOOK AT THE FIVE-YEAR PLAN TO SEE, SORRY, TO SEE IF WE HAVE A, A BUILT-IN REPLENISHMENT OF THAT RESERVE OR NOT, OR ONE, ONE OF THE THINGS THAT, THAT I'VE HEARD IN, IN MY FIRST FEW MONTHS IS, UM, THAT THIS ISN'T THE FIRST TIME, UM, THIS PROBLEM HAS BEEN IDENTIFIED AND, AND NOW MAYBE THE PROBLEM HAS ALWAYS BEEN CHARACTERIZED IN OUTER YEARS AND LATER YEARS FROM A FIVE YEAR PERSPECTIVE, WE POTENTIALLY HAVE A PROBLEM.
THERE'S NOT MUCH DOUBT THAT, THAT I THINK THAT WE HAVE A PROBLEM IF YOU JUST LOOK AT THE REVENUE FROM, IN THIS CASE, THE, THE FIRE, UH, CAPITAL SALES TAX AND THEN RELYING ON THE, THE GENERAL FUND FOR THE, FOR THE BALANCE AND THEN STILL, YOU KNOW, SPENDING DOWN FUND BALANCE.
IT CLEARLY SAYS WE WE'RE NOT, I MEAN THE, THE EFFORT, THE FUNCTION ISN'T FUNDED PROPERLY.
THERE'S PROBABLY A MIX OF OPTIONS OR WE'RE SPENDING TOO MUCH.
WELL, SURE, I MEAN, ABSOLUTELY.
BUT I THINK WHEN YOU GET INTO A REVIEW OF, OF THE FIRE EXPENDITURES PUT CAPITAL OUT ON ITS OWN ISLAND FOR THE MOMENT, IT COSTS WHAT IT COSTS TO, UH, TO OPERATE A FIRE DEPARTMENT.
UM, BUT THAT'S, IT'S, THAT'S, THAT'S A REASONABLE POSITION TO TAKE THAT WE NEED TO LOOK AT THE COST.
BUT I THINK IT'S ALSO FAIR TO SAY WHEN YOU SEE THE, THE, THE STARK DISPARITY AND, AND GROWING AND, AND IN FUTURE YEARS, WE, I THINK WE HAVE TO LOOK AT HOW WE'RE FUNDING BOTH, UH, FIRE AND POLICE.
BUT IT'S, IT'S PROBABLY A LITTLE MORE STARK, UH, A LITTLE MORE OBVIOUS IN THE SHORTER TERM IN THE FIRE FUND THAN IT IS THE POLICE FUND.
ANYTHING ELSE YOU WANNA ADD? UH, NO, I'D BE HAPPY TO ANSWER ANY QUESTIONS THAT YOU HAVE THOUGH.
NO, I, I'VE GOT A COMMENT, BUT NO, NO QUESTIONS.
UM, YEAH, OBVIOUSLY JUST LIKE YOU CHIEF, WE'RE ALL SITTING UP HERE TRYING TO FIGURE OUT HOW WE MOVE THIS THING FORWARD BECAUSE, UM, AS NICE AS YOU MADE THAT PIG LOOK WITH YOUR LIPSTICK, MR. KREGER, THE BOTTOM LINE IS IF WE TAKE OUT THAT 615,000 THAT'S PLUGGED INTO NEXT YEAR'S BUDGET FOR CAPITAL, WHICH IS THE EQUIPMENT YOU NEED TO GET, RIGHT? CORRECT.
YOU'RE STILL TALKING ABOUT 3.9 MILLION
[00:50:01]
ESSENTIALLY OF FUND BALANCE TO TAKE IT TO ZERO.HOW DO WE MOVE, HOW DO WE MOVE FORWARD? BECAUSE IT MEANS THAT BOTTOM LINE IS, IS THAT WE'RE GONNA HAVE TO SUPPLEMENT THAT BUDGET WITH MORE THAN THE, THE 30% AND WE'VE GOTTA FIND A WAY OUT OF IT.
AND, YOU KNOW, TO, TO, I THINK DRIVE A POINT HOME FOR A LOT OF PEOPLE HERE TODAY, IF YOU DON'T UNDERSTAND WHEN WE TALK ABOUT DEFICIT SPENDING, WE'RE NOT TALKING ABOUT TRULY DRIVING ANY FUND BELOW ZERO.
IT JUST MEANS WE HAVE TO FIND ANOTHER PLACE TO PAY FOR IT.
WHEN WE HIT THAT ZERO MARK, IT'S ALWAYS INTRA A YEAR WHEN WE TALK ABOUT IT, PERIOD.
RIGHT? I MEAN, WE LITERALLY, WE HAVE, WE'RE GONNA COMPLY WITH WHAT THE STATE CONSTITUTION AND STATE LAW SAYS.
AND SO WHEN WE HAVE THAT CONVERSATION ABOUT DEFICIT SPENDING, IT JUST MEANS HOW WE'RE MAKING THE NUMBERS WORK AS WE MOVE MONEY FROM ONE FUND TO ANOTHER AS WE TRANSFER MONEY TO MAKE IT ALL WORK.
UM, WHICH I THINK IS CONFUSING TO SOME PEOPLE WHO THINK, OH, THEY'RE JUST GONNA TAKE THIS THING NEGATIVE.
AND THAT'S WHY I THINK, UH, DURING THE LAST CYCLE, THE FIRST ONE THAT WE WERE INVOLVED IN, UM, WE WERE VERY CONCERNED ABOUT THE WAY WE WERE USING THAT TERMINOLOGY BECAUSE WE PRESENTED SOME THINGS THAT IMPLIED THAT, OH, WE'RE GONNA HAVE A NEGATIVE BALANCE AT THE END OF THE YEAR.
NO, IT'S GOING TO ZERO AND IT STOPS RIGHT THERE AND WE GOTTA FIGURE OUT HOW TO COVER THE REST OF THE EXPENSES.
SO YEAH, THIS IS A, A CHALLENGE AND IT'S, IT'S, I THINK IT'S CLEARER TO SEE IT WITH THE FIRE THAN IT IS WITH POLICE 'CAUSE THERE'S STILL A LITTLE BIT OF A CUSHION THERE.
BUT WE'VE GOTTA FIGURE OUT WHAT WE DO TO MOVE THAT NEEDLE TO, TO START THE REVENUE GENERATOR SO THAT WE CAN DO WHAT WE NEED TO BE DOING BECAUSE WE KNOW WE'VE GOT MORE NEEDS AND CAN I JUST OFFER UP ALL HOPE IS NOT LOST.
SO WHAT I SAID A FEW MINUTES AGO ABOUT LOOKING AT OUR FUND STRUCTURE AND BEGINNING TO UNWIND WHAT HAS BEEN A COST ACCOUNTING APPROACH TO OUR BUDGET, I THINK IS GOING TO PRESENT SOME OPPORTUNITIES FOR US TO LOOK AT SOME, AT SOME FUND BALANCES IN CERTAIN CAPITAL F FUNDS WHERE THERE MAY BE SHOULDN'T BE, IT'S GONNA GIVE US AN OPPORTUNITY, IT'S GONNA GIVE THE COUNCIL AN OPPORTUNITY TO PROVIDE SOME POLICY DIRECTION ON THE EXTENT TO WHICH SOME OF THESE, UM, SOME OF THESE OTHER CAPITAL F FUNDS THAT EXIST TODAY SHOULD EXIST FURTHER.
AND SHOULD THEY BE CHARGING BACK TO THE OPERATING DEPARTMENTS, NOT JUST POLICE AND FIRE, BUT ALL THE OPERATING DEPARTMENTS, WHAT IT IS, UH, I THINK THERE'LL BE SOME OPPORTUNITIES THERE.
I THINK THAT IF WE CAREFULLY LOOK AT OUR, OUR CAPITAL SPENDING, PARTICULARLY UNDER THE GENERAL HEADING OF VEHICLES, I THINK WE'LL FIND SOME OPPORTUNITIES, UM, TO SAVE A LITTLE BIT.
UM, BUT THIS IS, UH, THERE, THERE ARE A LOT OF FEEDERS IN TO THE COST SIDE AND, UH, FEWER, YOU KNOW, ON THE REVENUE SIDE THEN I THINK WE'RE GONNA HAVE TO, UH, KIND OF CAREFULLY LOOK AT HOW WE'RE SMALL F FUNDING PUBLIC SAFETY, UH, 'CAUSE WE'RE GONNA GET TO A POINT WHERE THE GENERAL FIRE CAN'T KEEP UP.
OKAY, WE'LL MOVE ON TO POLICE.
SO POLICE, SAME, SAME THING GOING ON HERE.
THEY DO HAVE A DEDICATED SALES TAX.
IT'S AROUND 3 MILLION A YEAR THAT THEY GET.
AND THEN, UH, AROUND 30 MILLION A YEAR, THEY GET 36.8% OF THE GENERAL FUND REVENUE.
SO THEY GET A LITTLE BIT MORE THAT WAY.
UH, ONCE AGAIN, THEY'RE USING FUND BALANCE OF ABOUT 4.6 MILLION.
UH, MOST OF THEIR EXPENSES REVOLVE AROUND PERSONAL SERVICES AND THEIR TRANSFERS OUT AGAIN ARE GONNA BE ADMIN, SUPPORT FLEET, THAT TYPE OF THING.
AND THEIR FUND BALANCE IS STILL, UM, A, A DECENT CUSHION AS WE JUST MENTIONED.
UM, SO THEY'RE USING 4.6 MILLION OF A $16 MILLION ANTICIPATED FUND BALANCE AT THE END OF 36.
THAT'S OUR, EXCUSE ME, OF THE END OF 26.
THAT'S OUR BEGINNING WHERE WE THINK WE'RE GOING TO END.
AND THEN AT 27 STILL HAVE ABOUT 12 MILLION LEFT.
AND I'LL TURN THIS OVER AND ACTUALLY I HAD, THIS SHOULD BE UPDATED BY ABOUT 600,000.
IT'S A LITTLE OVER 12 MILLION.
UH, SO I APOLOGIZE, WE HAD ANOTHER SLIDE IN HERE, BUT, UH, CHIEF YOUNGER, WOULD YOU LIKE TO SPEAK TO THAT?
[00:55:01]
THANK YOU FOR CLARIFYING THAT.JUST WHAT SHE MENTIONED WAS THE FUND BALANCE ENDING SHOULD BE AROUND 12.5, UH, WITH THE PROPOSED BUDGET AND WHERE THAT COMES FROM IS, UH, FUND USE, FUND BALANCE USE WILL BE RIGHT AROUND 4 MILLION INSTEAD OF 4.6 QUESTIONS.
I MEAN, SOME OF THE, OBVIOUSLY SOME OF THE SAME CONCERNS APPLY HERE, UM, BUT WE'VE GOT TIME TO FIGURE OUT HOW TO DEAL WITH THIS ONE.
COUNCIL MEMBER, WATERSON AND I HAD SOME DISCUSSIONS LAST YEAR AND, AND UH, AGAIN, I KNOW THIS DOESN'T SOLVE ALL THE PROBLEMS, BUT JUST AS A REMINDER, UH, THAT CRAWFORD AND ASSOCIATES, UH, WHEN THEY GIVE THEIR ANNUAL REPORT, THEY TALK ABOUT APPROPRIATE FUND BALANCE.
AND SPECIFICALLY FOR OURS, YOU KNOW, WE'RE ON AVERAGE SOMEWHERE AROUND 36 TO 39 MILLION, UH, FOR TOTAL BUDGET.
AND SO IF YOU LOOK AT ABOUT A 30%, UH, PROJECTED OUR OR PREFERRED FUND BALANCE, THAT WOULD BE SOMEWHERE BETWEEN 10 AND $12 MILLION.
AND SO THE ENDING FUND BALANCE FOR FY 27 PROJECTED AT 12.5 IS KIND OF AT THE TOP END OF WHAT WE THINK THAT THE, THE, THE FUND BALANCE SHOULD BE.
OBVIOUSLY THIS IS THE THIRD YEAR IN A ROW, UH, WHERE WE WILL HAVE TO USE FUND BALANCE THE PREVIOUS EIGHT OR NINE BEFORE THAT WE'RE ALWAYS INCREASE THE FUND BALANCE.
AND, AND SO AGAIN, IT IS DEFINITELY A CONCERN AND WE'RE PAYING ATTENTION.
UH, BUT IDEALLY WHEN WE EXCEED, UH, THE TARGETED FUND BALANCE OF 12 MILLION, THOSE ARE DOLLARS THAT WE EXPECT TO USE, UH, WHEN WE ENCOUNTER ECONOMIC SITUATIONS LIKE WE HAVE THE LAST THREE YEARS.
UH, NOT SAYING THAT WE LIKE TO DO THAT, BUT THAT'S KIND OF WHAT IT'S THERE FOR.
UH, BUT WHEN IT STARTS GOING SUB 12 MILLION, WHICH IS WHERE THE, THE SECOND AND THIRD YEAR, UH, OUT ARE PROJECTED, THAT'S DEFINITELY OUR AREA FOR CONCERN.
UH, WE, WE UNDERSTAND IT MIGHT, UH, BOUNCE AROUND THERE, BUT REALLY 12 MILLION AND UP IS WHERE WE'D LIKE TO BE.
UH, BUT JUST WANTED TO OFFER THAT FOR PERSPECTIVE ON, ON WHAT OUR TARGET IS AND, AND AT LEAST INSIDE THE BUILDING WHERE WE'RE PAYING ATTENTION TO, TO THE EBBS AND FLOWS OF, OF THOSE FINANCES.
IT'S JUST, THANKS FOR REMINDING ME ON THAT.
YEAH, WE MET LAST YEAR WHEN, WHEN I WAS LEARNING ABOUT ALL THIS AND TALKED THROUGH THAT.
I THINK I'M GONNA SAY A LITTLE BIT DIFFERENTLY.
I HOPE THIS DOESN'T COME ACROSS THE WRONG WAY, BUT I THINK WE, WE HAD SO MANY YEARS IN A ROW OF SALES TAX INCREASES IN THE CITY THAT WE GOT COMFORTABLE BUDGETING TO A NUMBER THAT EXCEEDED THE PROJECTED REVENUE.
AND WE, AND THAT WAS FINE WHEN THE SALES TAX EXCEEDED OUR PLANNED INCOME, BUT IT'S NOT FINE WHEN THE BALANCE SHEET HAS THE BALANCE ANY YEAR, LIKE LAST YEAR AND THE YEAR BEFORE AND MAYBE THIS YEAR.
SO THAT'S THE PHILOSOPHICAL CHALLENGE I HAVE WITH, WITH BOTH IS, AND, AND, AND I THINK WE TALKED ABOUT LAST YEAR, THERE'S AN OBJECT IN TURN THROUGHOUT THE YEAR TO KIND OF UNDERSPEND.
I DON'T KNOW HOW WE'RE LOOKING ON THAT THIS YEAR, BUT UM, YOU KNOW, WE CAN ONLY DO THAT SO LONG AND, AND IT TO BE SUSTAINABLE OBVIOUSLY.
SO I THINK, I THINK WE NEED TO STEP BACK AND THINK ABOUT THAT EVERY YEAR AND HOW VOLATILE IS THE SALES TAX PREDICTION AND UM, WHAT DO WE WANNA ASSUME WE'RE GONNA HAVE IN TERMS OF INCOME? 'CAUSE YEAH, YOUR BALANCE AT 12 POINT A HALF MILLION IS, IS OKAY, BUT IF WE SPEND 4 MILLION A YEAR, RIGHT, THEN THAT RUNS OUT IN THREE YEARS.
SO THIS IS ANOTHER ONE WHERE I THINK THE FIVE YEAR PLAN IS INSTRUCTIVE, UH, TO SEE WHAT WE'RE PROJECTING TO SPEND OVER THE NEXT FEW YEARS AND WHETHER WE EXPECT IT TO REPLENISH OR WHETHER WE'RE JUST, LIKE PHIL SAID EARLIER, LIKE SORT OF CROSSING OUR FINGERS AND HOPING THAT SALES TAX MAGICALLY GOES BACK UP.
NOT TO BE, YOU KNOW, NOT TO BE SILLY ABOUT IT, BUT TO SOME EXTENT THAT'S KIND OF WHAT WE'VE GOTTEN IN THE HABIT OF DOING, YOU KNOW, FIVE, 10 YEARS AGO WHEN THINGS WERE JUST GOOD EVERY YEAR AND WE COULD KIND OF COUNT ON THAT.
SO ANYWAY, THAT'S MY TAKE ON IT.
ANY OTHER QUESTIONS? THANK YOU CHIEF.
SO NOW WE'RE GOING TO TURN TO OUR UTILITIES.
SEVERAL OF THEM, NOT EVERY ONE OF THEM, BUT MOST OF THEM AND ALL OF OUR DIRECTORS ARE HERE.
SO I'LL JUST KIND OF TOUCH ON EACH ONE.
UM, WE ARE GOING TO GET INTO WATER MUCH DEEPER IN A DI IN ANOTHER, UH, WORKSHOP.
SO, UH, WE'LL GO OVER THE HIGHLIGHTS TODAY, BUT STOP ME IF YOU HAVE ANY QUESTIONS.
UH, SO FIRST OF ALL, ELECTRIC, AND AGAIN, THESE ARE ALL ESTIMATED, UM, FROM THE DEPARTMENT HEADS THEY'RE PUTTING IN THEIR REVENUE THAT THEY THINK THEY'RE GONNA BRING IN AND, UM, THEIR CAPITAL OUTLAY.
THOSE ARE A LOT OF THE BIGGEST ITEMS IN, IN THESE, UH, FUNDS.
BUT BASICALLY IF YOU LOOK AT UTILITIES ELECTRIC UTILITY, THE ONE 107 MILLION IS ABOUT A 1% INCREASE OVER, UH, OUR ADOPTED BUDGET LAST YEAR.
INTEREST IN INVESTMENT INCOME IS HIGHER, QUITE A BIT HIGHER.
IT'S LIKE 200% HIGHER, BUT THAT'S BECAUSE, UM, WE HAVE, IT'S REALLY OUR FIRST FULL YEAR
[01:00:01]
OF HAVING THE LOAN PROCEEDS AVAILABLE TO US OF 20 MILLION THAT WE TOOK OUT DEBT FOR LAST YEAR.UH, THEY DON'T HAVE ANY TRANSFERS IN AND THEY'RE USING THEIR FUND BALANCE OF ABOUT 12.8 MILLION THIS YEAR.
SO EXPENSES UM, AGAIN, THEIR PERSONNEL.
LET'S SEE, WHAT DID IT GO UP? SO THEIR PERSONAL SERVICES IS UP ABOUT 8% OVERALL.
THEIR WHOLE, UM, OH, SORRY, I'M LOOKING AT THROW ONE UP.
OVERALL, THEIR TOTAL BUDGET IS, UM, IS DECENT.
I MEAN, IT'S FIVE OR 6%, SO IT'S NOT CRAZY.
THERE IS, UM, DEBT SERVICE THAT WE HAVEN'T HAD IN THE PAST BECAUSE OF THE NEW DEBT THAT WE TOOK OUT.
THE TRANSFERS OUT ARE THEIR FLEET, THEIR ADMIN SUPPORT, AND THEY DO CONTRIBUTE $4 MILLION A YEAR TO THE GENERAL FUND.
UM, AND THEN I DIDN'T HAVE THEIR FUND BALANCE RIGHT NOW BASED ON OUR AUDITED 25 FINANCIALS, WHAT WE'RE ESTIMATING TO END AT 6 3 26.
AND THEN BUDGETED EXPENSES THROUGH 27 IS ABOUT 71 MILLION.
AND I THINK GLENN FISHER'S HERE IF YOU WOULD LIKE TO HEAR FROM HIM.
GOOD AFTERNOON, MAYOR AND COUNCIL.
GLEN FISHER, DIRECTOR OF EDMOND ELECTRIC.
I WILL TELL YOU WHATEVER YOU WANT TO KNOW.
WHAT WOULD YOU LIKE TO HEAR?
UM, WE DID, WE, UH, OUR, IN OUR REVENUE PROJECTIONS DID INCREASE SLIGHTLY THIS YEAR.
UM, OF COURSE OUR BIG EXPENSE EVERY YEAR IS WHOLESALE POWER.
WE'RE PROJECTING THAT TO BE ABOUT 70 MILLION, WHICH IS UP FROM ROUGHLY 63 MILLION LAST YEAR.
AND THAT'S PRIMARILY DUE TO WHAT WE PROJECT FOR NATURAL GAS PRICES COMING UP IN THE NEXT YEAR.
UM, THOSE MAY TURN OUT TO BE INACCURATE WITH RECENT EVENTS, SO WE WILL HAVE TO FOLLOW THOSE THROUGHOUT THE YEAR.
UM, JUST A REMINDER THAT ABOUT, UM, A PORTION OF THAT IS RECOVERED THROUGH OUR BASE RATES, BUT THE MAJORITY OF THAT IS RECOVERED THROUGH OUR FUEL COST ADJUSTMENT.
AND SO IF THERE IS AN INCREASE IN, IN NATURAL GAS PRICES THAT DOES AFFECT THAT WHOLESALE POWER, WE CAN LOOK AT THE FUEL COST ADJUSTMENT.
AND IN OUR RESERVES WE ALSO CARRY $20 MILLION OF RESERVES FOR RATE STABILIZATION.
UM, TYPICALLY WHAT WE TRY TO DO IS MAKE SURE WE DO NOT HAVE ANY RATE CHANGES FOR OUR CUSTOMERS.
WE'VE BEEN MAINTAINING THE SAME FUEL COST ADJUSTMENT EVERY MONTH AND UTILIZING THAT RATE CIVILIZATION WHEN NEEDED TO KEEP THOSE, UM, CHARGES STABLE FOR OUR CUSTOMERS.
UM, AS FAR AS THE, UH, UM, THE, UH, FUND BALANCE THAT KATHY MENTIONED, UM, THAT DOES INCLUDE ROUGHLY WE ISSUED, UH, DEBT SERVICE IN 2025.
THAT INCLUDED ABOUT 22 MILLION, UH, BOND PROCEEDS.
SO THERE'S ABOUT 19 MILLION OF THAT IN THAT, UH, FUND BALANCE.
AND, UH, THE REMAINING IS, UH, WE LOOK AT A, TRYING TO KEEP A RESERVE BALANCE OF $51 MILLION A YEAR.
AND THAT COVERS, LIKE I SAID, THE RACE UTILIZATION REPAIR AND REPLACEMENTS.
UM, A CONTINGENCY IN AN EMERGENCY FUND.
UH, JUST IN CASE THERE'S ANY ISSUES WE CANNOT RESOLVE, UH, THROUGH OUR CURRENT CHARGES, WE CAN DIP INTO THOSE FUNDS IF THERE'S SOME TYPE OF EMERGENCY OR PROJECT THAT WE DID NOT ANTICIPATE, I HAD TO SWITCH MY BRAIN OVER FROM POLICE AND FIRE TO UTILITIES.
YOUR BUSINESS MODEL TOTALLY DIFFERENT.
IT'S LIKE, WELL THAT RESERVES NUMBER IS HUGE.
UM, SO YOU KEEP ABOUT SIX MONTHS OR SO, RIGHT? OF, OF OPERATING RESERVES.
IT'S, UH, MOST OF IT'S BASED ON ONE TWENTY, A HUNDRED TWENTY DAYS.
UM, AND THEN I MIGHT HAVE DONE THAT MATH WRONG.
FOUR MONTHS AND THEN 20 MILLION SET ASIDE FOR RATE STABILIZATION.
SO THAT'S THE CHUNK OF THE MAJORITY OF YOUR YES.
SO OPERATIONALLY, UM, I CAN'T REMEMBER THE EXACT NUMBER.
I THINK I DO, BUT I'M NOT GONNA, I'LL LET YOU SPIT IT OUT.
WHAT OMPA WHOLESALE POWER, HOW MUCH OF YOUR TOTAL DOES THAT REPRESENT IN TERMS OF YOUR COST? LAST YEAR AT 68%? THAT'S WHAT I THOUGHT I REMEMBERED, BUT IT SEEMED OFF HIGH.
I HAVEN'T CALCULATED THIS YEAR.
'CAUSE WE WERE WORKING ON FINALIZING THE BUDGET NUMBERS.
I TYPICALLY DO A BREAKDOWN, IT SHOWS THAT FOR EVERY YEAR.
SO I, I'M NOT AT THIS POINT GONNA ASK, GONNA TRY TO STEAL YOUR THUNDER, BUT IN, IN, IN THE FUTURE,
[01:05:01]
DO YOU SEE WAYS THAT IT, IT COULD BE A LITTLE BIT MORE IN THE COST SIDE, PERSONNEL MAYBE, WHATEVER, BUT A A MEANS IN WHICH THAT THAT COULD BE LOWERED SO THAT YOUR OVERALL NET IS ACTUALLY LOWER.IS THAT A POSSIBILITY IN YOUR MIND? IT IS.
THAT'S SOME OF THE PROJECTS WE HAVE GOING FORWARD THAT WE'RE LOOKING AT, UM, THROUGH MPA.
WE'RE BASED ON OUR PEAKS IN JULY, AUGUST, UH, UM, IN SEPTEMBER, JUNE, JULY, AUGUST AND SEPTEMBER, EXCUSE ME, THOSE FOUR MONTHS.
SO THOSE FOUR PEAKS SET A CAPACITY FIGURE FOR OMPA FOR THE REST OF THE YEAR.
SO EVEN IF WE DIP BELOW THOSE NUMBERS, WE STILL PAY FOR THAT SUMMER PEAK NUMBER, RIGHT? AND SO DROPPING THAT SUMMER PEAK WILL SAVE US, UH, MONEY.
ONE OF THE PROJECTS WE'RE LOOKING AT, UM, IS A CONSERVATION VOLTAGE REDUCTION.
I WON'T GO INTO DETAILS ON THAT, BUT IT HELPS SHAVE OUR PEAK AND WE'RE LOOKING AT, UH, 2%, UM, REDUCTION IN OUR PEAK, WHICH WOULD SAVE US ABOUT 1.4 MILLION A YEAR.
UM, AND THEN OF COURSE, I, AS I MENTIONED, THAT'S BASICALLY GOES STRAIGHT BACK TO THE RATE PAYERS.
IT'S JUST SOMETHING THEY DON'T HAVE TO PAY FOR.
WE'RE LOOKING, WE'VE, UH, WORKED WITH OPA TO SET UP A TURN DOWN THE WATCH PROGRAM, WHICH IS A THERMOSTAT CONTROL PROGRAM, UH, THAT CUSTOMERS CAN SIGN UP FOR, UH, USING SMART THERMOSTATS.
IT BASICALLY REDUCES, IT TURNS OFF IT PRE COOLS AND THEN TURNS OFF THEIR THERMOSTAT FOR 15 MINUTE INTERVALS DURING THAT PEAK PERIOD.
THAT'S BEEN A VERY SUCCESSFUL PROGRAM, I THINK IN EDMOND RIGHT NOW.
THEY JUST STARTED THIS PROGRAM UP ABOUT 10 MONTHS AGO AND WE'VE GOT ABOUT 2000 METER OR THERMOSTATS IN, UH, EDMOND ALREADY, UM, SIGNED UP FOR IT.
AND THEN WE'RE ALSO LOOKING AT SOME RECONDUCTORING PROJECTS, WHICH HELP PRODUCE OUR OVERALL LOAD AS WELL.
MAKES OUR SYSTEM MORE EFFICIENT, UM, AND INCREASES OUR CAPACITY TO MOVE ELECTRICITY AROUND THE SYSTEM.
SO THAT PEAK IS VERY IMPORTANT.
I I REMEMBER THE, THE DAY THAT YOU TOLD ME ABOUT THAT.
I SAW, I SAW AN ARTICLE IN THE OKLAHOMA AND ABOUT EXTENDED CONSECUTIVE FLAT BUDGETS POSE RISKS.
NOW, NOW THIS WAS TALKING ABOUT STATE, BUT I CAN, I CAN FIND APPLICATIONS AND YOU'RE ONE OF THEM.
I THINK EEDA IS ANOTHER, AND I WOULD ASK AS WE GET, NOT THIS YEAR, BUT WE DON'T HAVE CHOICES PROBABLY THIS YEAR, BUT DOWN THE ROAD, I WOULD ASK THE SPECIALTY CITY MANAGER AND DEPARTMENT HEADS TO LOOK FOR WAYS.
IT MAY AT THE SURFACE INITIAL HAVE A LITTLE BIT OF AN UPSWING IN, IN, LET'S SAY PERSONNEL, BUT YOUR OVERALL CAN DROP AND, AND, AND THE WAY YOU DROP IS BY DOING THAT.
BUT SOMETIMES THAT TAKES PEOPLE OR THAT TAKES A CAPITAL INVESTMENT, WHAT WHATEVER IT REQUIRES.
IT, IT, IT, IT JUST MADE ME THINK A LITTLE BIT DEEPER AND, AND, AND, AND DON'T MISUNDERSTAND ME.
I'M NOT SAYING WE NEED TO GO OUT AND WE NEED TO HAVE CAPITAL EXPENDITURES OF A BILLION DOLLARS, BUT FLAT BUDGETS DO POSE RISK WHEN BACK TO BACK TO BACK TO BACK.
AND WHERE THEY RISK IS INFRASTRUCTURE AND WHERE THEY RISK IS THAT IF YOU DEPRESS, WHICH WE WANT TO DEPRESS EXPENDITURES, BUT IF REVENUES ARE FLAT OR COMING DOWN, YOU HAVE THE SAME OR AN EXTENUATED PROBLEM THAT YOU HAD WHEN YOU STARTED.
I HOPE THAT THAT YOU GUYS AND CITY MANAGER AND OTHER DEPARTMENT HEADS WILL LOOK FOR WAYS THAT WE CAN RELATIVELY HOLD BUDGETS FLAT, BUT PEAK IT ON THE OTHER SIDE AND SOMETIMES THAT TAKES A LITTLE BIT OF INGENUITY AND OUTSIDE THE BOX THINKING.
AND I, I, I APPRECIATE YOU DOING THAT, GLEN.
I I THINK THE ARTICLE NOTED THAT SOMETIMES WE CAN BE SO PROUD OF OURSELVES THAT WE'VE DONE SOMETHING MAGNANIMOUS THAT WE HAVE A FLAT BUDGET, BUT IT'S THE, THE REFERENCE WAS, IT'S LIKE TAKING A RIBBON YOU WANT AT THE COUNTY FAIR AND HANG IT ON THE WALL AND YOU CAN'T CASH THAT.
WE HAVE TO LOOK FOR WAYS WHERE WE CAN CASH OUT.
AND, AND SO I, I APPRECIATE YOU DOING THAT AND, AND I THINK YOU'VE ALWAYS DONE THAT ELECTRIC DEPARTMENT'S AMAZING SHAPE AND YOU, YOU'VE BEEN A, YOU'VE BEEN A GREAT TEAM PLAYER IN WHAT YOU'VE DONE WITH THAT FOR THE REST OF THE CITY.
ANY MORE QUESTIONS? THANK Y'ALL VERY MUCH.
OKAY, WE WILL MOVE ON TO WATER WA WATER AND WASTEWATER.
UM, I'M NOT GOING TO TRY AND EXPLAIN A LOT.
UM, WE'LL HAVE, CHRIS AND I CAN COME UP HERE AND SPEAK TO IT.
[01:10:01]
BUT BASICALLY, UM, AGAIN THERE THE CHARGES FOR SERVICES, UH, THE ESTIMATE OF 44 MILLION IS AROUND A LITTLE UNDER 5% INCREASE FROM LAST YEAR.UM, WE ARE GOING TO TALK ABOUT WATER AND WASTEWATER IN DEPTH IN ANOTHER BUDGET WORKSHOP, BUT CHRIS HAS A LOT OF, UM, CAPITAL EXPENDITURES COMING UP, MORE DEBT THAT WE POSSIBLY COULD GO OUT FOR.
AND HE'S GOT A RATE STUDY COMING UP.
SO WE ARE IN THE MIDDLE OF REALLY TRYING TO PERFECT THE PERFECT THIS AT THIS POINT.
BUT YOU CAN SEE, SO WE'RE PROJECTING USING SOME OF THE FUND BALANCE, BUT THAT REALLY IS BECAUSE THERE'S SO MUCH CAPITAL OUTLAY GOING ON.
AND, UM, AGAIN, I'LL LET CHRIS SPEAK TO THIS AND I DON'T HAVE THE FUND BALANCE HERE, BUT HE CAN, HE IS VERY, VERY GOOD ABOUT WATCHING HIS DEBT.
HE GOES OUT FOR THE WHOLE LENGTH OF THE LOAN AND HE HAS HIS WHOLE CAPITAL OUTLAY PLAN.
SO, UM, CHRIS, ARE YOU AVAILABLE? YES.
GOOD AFTERNOON, MAYOR AND COUNSEL, CHRIS ING, DIRECTOR OF WATER RESOURCES.
UM, AS KATHY WAS SAYING, UM, I THINK AT OUR NEXT WORKSHOP, UH, WE'RE GONNA DO THE WATER WASTEWATER RATE STUDY, GO INTO MORE DEPTH ON THE FINANCIALS.
UM, YOU'RE SEEING TODAY ON THE REDUCTION IN, UM, GO TOTAL USE IS EXCEEDING, UM, IT'S NOT QUITE AS DRAMATIC, BUT A LOT OF IT'S THE ACCOUNTING OF, YOU KNOW, INTEREST EXPENSE AND UH, LOAN PROCEEDS AND, UM, GOTTA WORK ON A WAY TO SHOW THAT BETTER.
AND KATHY AND I HAVE BEEN TALKING ABOUT THAT AND AJ AS WELL.
UM, IT GETS CONFUSING WHEN I START TALKING THROUGH IT.
SO, UH, WE CAN GO INTO AS MUCH DETAIL AS YOU'D LIKE.
I I WAS JUST GONNA SAY, I DON'T WANT TO PREEMPT ANYTHING THAT YOU WANT TO ASK, BUT WHAT KATHY SAID A SECOND AGO AND WHAT CHRIS JUST MADE REFERENCE TO IS AT OUR NEXT WORKSHOP WE'RE GOING TO TALK ABOUT THE WATER CAPITAL IMPROVEMENT PLAN, WHICH IS, AND THE WATER RATE STUDY, BOTH OF WHICH I THINK ARE GOING TO INFORM YOUR, UH, YOUR CHOICES AND YOUR, YOUR DECISIONS ABOUT THIS FUND.
SO I THINK IF, IF YOU'RE OKAY WITH IT, I WOULD VIEW THIS AS REALLY KIND OF THE START AND INTRODUCTORY PART OF A DISCUSSION ABOUT, UH, THE WATER, UH, AND THE WASTEWATER UTILITY IN PARTICULAR.
UNTIL YOU SEE THE CAPITAL PLAN AND UNTIL YOU SEE THE, UH, THE CORRESPONDING RATE STUDY, IT'S REALLY THE MAIN DRIVER.
AND SOME OF IT'S, UH, SOME OF THE ASSUMPTIONS IN THE CAPITAL IMPROVEMENT PLAN ARE BUILT IN, A LOT ARE NOT.
SO IT'S, IT'S A HYBRID AND WE DON'T WANT TO ASSUME WHAT COUNCIL WANTS TO DO, BUT WE'RE ON THE MIDDLE GROUND OF THAT.
SO, UM, YEAH, I, I KNOW WE HAD SOME DISCUSSION, UH, ABOUT ASSUMPTIONS MADE FOR THE RATE SETTING.
WE'VE GOT A KIND OF A SUMMARY OF THOSE THAT WILL PRESENT AT THE WORKSHOP OR BEFOREHAND, BUT, UM, THERE'S A LOT OF MOVING PARTS WITHIN THE RATE PLAN AND, UH, GET UP AND TALK THROUGH 'EM.
I, YOU KNOW, FOCUSING ON, YOU KNOW, PERSONNEL, PERSONAL PERSONAL SERVICES PERSONNEL, UM, BUT THOSE COSTS ARE RELATIVELY THE SAME.
UH, WE WERE LOOKING AT IT EARLIER AND THE WAY THAT THEY GET SPLIT AMONG WATER AND WASTEWATER EVEN WITHIN THE TWO FUNDS BECAUSE WE SHARE MAINTENANCE AND ADMIN SO THAT WE DON'T DUPLICATE THE SERVICES.
UM, IT, IT'S WITHIN THREE POINT SOMETHING PERCENT OF WHAT THIS YEAR IS CURRENTLY.
SO, UM, NOW WE DID ASK FOR, UM, A POSITION OR TWO, BUT RELATED TO THE PLAN EXPANSIONS AND THAT'LL BE A SEPARATE DISCUSSION.
SO, BUT I WOULD LOVE TO TALK ABOUT ANY, ANY OF THE ABOVE IF YOU ALL HAVE QUESTIONS.
I PERSONALLY THINK A WHOLE LOT OF CONVERSATION AT THIS POINT IS A LITTLE PREMATURE UNTIL WE CAN DIG INTO THE RIGHT ANALYSIS.
SO YEAH, WE'VE BEEN DEEP DIVING THIS AT, UH, PUBLIC WORKS COMMITTEE AND IT'S EASIER TO LOOK AT IT THAT WAY.
TO ME, THAT'S A MUCH DEEPER LOOK AT THE REVENUE AND EXPENSE SIDE AND ALL THE KNOBS YOU CAN TURN TO MAKE THOSE THINGS DIFFERENT.
AND THIS IS A SNAPSHOT OF A CERTAIN SET OF ASSUMPTIONS.
BY THE WAY, CHRIS DID JUST MAKE REFERENCE TO
[01:15:01]
SOMETHING THAT WE ARE PLANNING, UH, THAT EVERY ENTERPRISE FUND, UH, AT LEAST MAYBE MORE, BUT AT LEAST EVERY ENTERPRISE FUND WILL FUND A BUDGET ANALYST POSITION THAT WOULD ULTIMATELY REPORT TO THE FINANCE DIRECTOR.BUT WE WOULD EMBED, UH, A BUDGET ANALYST IN EACH OF THE ENTERPRISE FUNDS TO HELP THEM AS THEY DO THINGS LIKE RATE STUDIES AND AS THEY LOOK AT DEBT ISSUANCES, UM, DEBT SERVICE, ET CETERA, ET CETERA, TO BE UH, UH, LITERALLY AN IN THE BUILDING RESOURCE FOR THEM AND THEN TO AT THE SAME TIME KIND OF GROW, UH, OUR CITYWIDE ABILITY TO ANALYZE BUDGET TRENDS AND THOSE KINDS OF THINGS.
I THANKS CHRIS FOR MAKING THAT.
ALRIGHT, WHERE DO YOU WANNA GO FROM HERE? WELL, I THINK THE SAME IS TRUE OF THE WASTEWATER UTILITY.
THEN I THINK WE CAN GO TO DRAINAGE.
OKAY, SO WE ONLY HAVE A COUPLE THINGS LEFT.
SO KEITH BEATTY IS, UH, OUR DEPARTMENT HEAD FOR DRAINAGE.
AND ARE YOU HERE, KEITH? SO IF YOU'D LIKE TO DISCUSS THIS, UM, HE'S HAS A CAPITAL PLAN THAT HE'S HAD IN PLACE FOR A VERY LONG TIME.
AND UM, AGAIN, SO YOU'RE SEEING A USE OF A FUND BALANCE, BUT THAT IS BASICALLY CAPITAL AND UH, HE HAS AN EXTENSIVE LIST OF WHAT THAT IS USED FOR.
UM, AND THE CHARGES FOR SERVICES FOR THEM IS WHAT WE CHARGE ALL OF OUR CUSTOMERS AS A DRAINAGE FEE IS WHERE THAT COMES FROM.
AND UH, AGAIN, SO YOU CAN SEE THE CAPITAL OUTLAY OF ABOUT 9 MILLION AND UM, THE FUND BALANCE FOR DRAINAGE IS STILL AROUND ABOUT 7 MILLION.
WHAT WE'RE ESTIMATING AS OF TODAY.
WOULD YOU LIKE TO HAVE MR. BEATTY? YES.
WHAT QUESTIONS CAN I ADDRESS FOR YOU? DO YOU WANT ME TO DESCRIBE A LITTLE BIT ON THE CAPITAL IMPROVEMENTS WE GOT PROPOSED? YEAH, WHY DON'T YOU START THERE AND TELL US ABOUT THE PROPOSED CAPITAL IMPROVEMENTS AND WE CAN KIND OF CIRCLE BACK TO ANY OTHER QUESTIONS.
UH, ONE OF THE FIRST THINGS I'LL TALK ABOUT, WE'VE GOT A COUPLE OF DESIGNS, UH, STUDIES WE GOT GOING ON, UH, THAT'S REALLY COMING OUT OF THE 83 19, BUT WE, MR. BEATTY, WOULD YOU PULL THAT MICROPHONE UP? YES SIR.
IS THIS BETTER? SO WE'VE GOT A COUPLE OF STUDIES WERE BEING DONE.
UH, ONE OF THE THINGS THAT WE'VE BEEN WORKING ON, WE'VE GOT PHASE ONE GOING ON RIGHT NOW AND IT'S FOR A STUDY OF THE STORM SEWER INFRASTRUCTURE.
OUR GIS THAT THE CITY HAS HAS A LOT OF, UH, MISSING DATA WHEN IT COMES TO STORM SEWER.
THE CITY HAS NEVER PUT A BIG INVESTMENT ON INTO DEVELOPING A BETTER ASSETS FOR THAT.
CURRENTLY WHAT'S IN GIS IS JUST WHAT THEY TOOK OFF OF ATLAS MAPS PLANS.
AND SO WE'VE GOT A SURVEY PROJECT GOING ON.
THE FIRST PHASE IS, UH, A LITTLE BIT UNDER A MILLION DOLLARS.
SO I'VE GOT PLANNED TO DO A SECOND PHASE, ABOUT A MILLION DOLLARS THERE.
AND THEN THE OTHER STUDY WE'RE LOOKING AT TO DO UNDER THE PROFESSIONAL SERVICES IS A STUDY OF THE DEEP FORK AREA, FAR OUT EAST EDMOND OUT IN EAST EDMOND.
WE GOT SOME FLOOD ZONES THAT ARE JUST AS OWN A, NOT A DETAILED STUDY, NOT AN AE.
SO WE'RE PROPOSING TO DO A STUDY OUT THERE TO GET A BETTER IDEAL OF THE FLOODPLAIN OUT THERE FOR AS DEVELOPMENT MOVES TO THE EAST EDMOND AREA ON OUR CAPITAL IMPROVEMENTS.
OUR LAND BETTERMENTS, SEVERAL ONES WE GOT GOING GOING ON NEXT YEAR WILL BE SOME, AS YOU KNOW, THE CITY OWNS ABOUT 22 DETENTION PONDS THAT WERE ACCEPTED IN THE LATE SEVENTIES, EARLY EIGHTIES.
AND SO WE'VE GOT ONE OF THOSE PROPOSED FOR REHABILITATION.
UH, MOST OF THOSE DETENTION PONDS THE CITY OWNS.
THE ONLY THING THAT'S BEEN DONE IN THE YEARS SINCE WE ACQUIRED 'EM IS MOSTLY JUST MAINTENANCE OF VEGETATION, NO REAL, UH, REHABILITATION OF THEM.
SO WE'RE TRYING TO REHABILITATE ONE ABOUT ONE A YEAR AND THEN, UM, IN THE CAPITAL VIEW AREA OF TOWN OVER BY UH, SECOND AND BOULEVARD.
THERE'S AN AREA IN THERE THAT'S HAD A LOT OF DRAINAGE ISSUES.
WE'VE HAD THAT UNDERSTUDY AND THAT'S ONE OF OUR CAPITAL IMPROVEMENT PROJECTS
[01:20:01]
WE PLAN TO DO IS GO IN THERE AND DO SOME MAJOR STORM SEWER IMPROVEMENTS.AND, UM, OVER IN, UH, ANOTHER FLOODS FLOOD AREA AREA WHERE WE HAVE FLOODING OVER IN THE WICK COMMUNITY, THE COMMUNITY JUST NORTH OF THE UNCOMMON GROUND PARKS SCULPTURE PARK, UH, THERE'S SOME AREA NEAR WHERE THE DETENTION POND HAS NOT BEEN PERFORMING WELL.
UH, THE PIPE INTO THE DETENTION POND IS LOWER THAN THE PIPE OUT OF THE DETENTION POND.
UH, THE STORM SEWER IS ALL UNDERSIZED.
WE'RE LOOKING TO GO IN THERE AND REHABILITATE THAT DETENTION POND AND UH, DO SOME STORM SEWER IMPROVEMENTS IN THAT SUBDIVISION.
UH, ANOTHER BIG PROJECT WE GOT GOING AND I CAN GIVE YOU, ARE Y'ALL WANTING DOLLAR AMOUNTS ON THESE? AS I KIND OF GO WHAT WE'RE PROJECTING TO SPIN ON 'EM, DO YOU HAVE A SUMMARY LIST, KIND OF LIKE WATER AND ELECTRIC DO OF THE CAPITAL PLAN? YES SIR.
MAYBE YOU COULD SEND IT TO US AND GET, MAYBE YOU COULD SEND IT TO US OR PUT IT IN THE, IN THE PACKET OR SOMETHING.
I FEEL LIKE I'M CATCHING UP ON SOME OF THIS, NOT ON SWAB THESE GUYS.
UM, ON YOUR REVENUE, YOU'RE SHOWING CHARGES FOR SERVICES OF BEING 6.2, ALMOST 6.3 MILLION, WHICH IS LIKE AN 84% INCREASE FROM THE CURRENT YEAR.
WHAT'S, WHAT'S ACCOUNTING FOR THAT LARGE INCREASE? AS YOU KNOW, FOR THE LAST COUPLE OF YEARS? UH, JANUARY 1ST, 2025, WE WENT FROM $3 TO $6 AND THEN IN JANUARY OF 26 WE WENT FROM $6 TO $9.
SO IT'S A RATE INCREASE THAT WE'VE BEEN SEEING.
OTHER QUESTIONS? ALRIGHT, THANK YOU.
OKAY, SO MOVING ON TO SOLID WASTE.
WE HAVE UH, KEITH STEWART AND OR BOBBY MASTERSON THAT ARE THE DEPARTMENT HEADS FOR THIS AREA.
AND UM, SO AGAIN, LET'S SEE, WHAT IS THE CHARGES FOR? SERVICES ARE ESTIMATED ABOUT 1.4% INCREASE.
UH, INTEREST IS UP A LITTLE BIT AND THAT'S ALWAYS JUST BASED ON RATES AND OUR EXPERIENCE.
UM, LOOKS LIKE PERSONNEL IS UP.
PERSONAL SERVICES A LITTLE BIT ABOUT 8.85% AND OVERALL THEIR TOTAL EXPENSES ARE ABOUT ABOUT 2.61% UP.
WE ARE ESTIMATING, UH, FUND BALANCE OF AROUND 11.5 MILLION AT THE END OF 27.
AND BOBBY OR KEITH, DO YOU WANNA COME UP AND GOOD AFTERNOON.
BOBBY MASTERSON, ASSISTANT DIRECTOR OF PUBLIC WORKS.
I'M HERE TO ANSWER ANY QUESTIONS YOU GOT QUESTIONS? ANY QUESTIONS? DO YOUR RESERVES INCLUDE A CERTAIN NUMBER OF DAYS OF OPERATIONS? I CAN'T REMEMBER.
I THINK THE COUNCIL KNOWS THIS, BUT THERE WAS A RATE STUDY PERFORMED FOR SOLID WASTE THAT HAS BEEN, UH, HELD AT LEAST IN UH, SOME ABEYANCE AND I'VE MET WITH UH, BOBBY AND KEITH AND STAFF TO TALK ABOUT IT.
IT JUST ISN'T SOMETHING WE'VE BROUGHT FORWARD YET.
BUT THERE IS A RATE STUDY THAT AT SOME POINT I THINK IT WOULD MAKE SENSE TO PUT BACK IN FRONT OF THE CITY COUNCIL AND HAVE YOU PUNT IT? UH, VOTE YES, VOTE NO.
MAKE CHANGES OR ASK FOR CHANGES BUT PROBABLY NEED SOME PUBLIC REVIEW.
LOOKS LIKE IT'S UH, PRETTY STABLE RIGHT NOW THOUGH IN TERMS OF REVENUE COVERING EXPENSES, SO THAT'S GOOD TO SEE.
ALRIGHT, ANY OTHER QUESTIONS? THANK YOU BOBBY.
AND THE LAST DEPARTMENT IS FLEET MANAGEMENT, WHICH IS ALSO BOBBY MASTERSON AND UM, IT'S, IT'S JUST OUR LEASE PAYMENTS, UH, ASSESSMENTS THAT ALL THE DIFFERENT DEPARTMENTS PAY IN OVER THE COURSE OF EVERY YEAR TO REPLACE THEIR VEHICLES WHEN THEY'VE COME DUE.
AND UM, SO BASICALLY YEAH, THAT WAS USES THIS YEAR AND I KNOW BOBBY SPENDS A LOT OF TIME REALLY PLANNING ALL THIS OUT AND HE LOOKS
[01:25:01]
AT EVERY VEHICLE.SO HE IS INCREASING HIS FUND BALANCE THIS YEAR ABOUT BY ABOUT A MILLION DOLLARS AND IT IS ESTIMATED TO BE AROUND 27 MILLION AT THE END OF FISCAL YEAR 27.
SO I'LL TURN IT BACK OVER TO BOBBY.
I THINK IT'S IMPORTANT TO NOTE, UH, ONE PIECE OF THIS SPECIFICALLY, UM, THAT THE FLEET BALANCE INCLUDES FIRE, POLICE, ELECTRIC AND THEN ALL OTHER PUBLIC WORKS VEHICLES AND THEY'RE SUB IT BETTER, SORRY, THEY'RE SUBDIVIDED BY DIFFERENT ACCOUNTS THAT FEED INTO THIS 6, 5, 4 IN DIFFERENT DIVISIONS.
AND SO THERE'S SEPARATE BALANCES THAT ADD INTO THAT, THAT INCREASE THAT AS WELL.
YOU RECENTLY APPROVED THE PURCHASES FOR THIS YEAR OUT OF THE GENERAL FUND THAT THAT HANDLES THE PUBLIC WORKS VEHICLES AND THAT EXPENDITURE WAS ABOUT $3.4 MILLION AND THAT COVERS THE REPLACEMENT OF ALL THE PUBLIC WORKS VEHICLES, WHICH IS ONE OF THOSE DIVIDED FOUR ACCOUNTS.
WHAT'S INCLUDED IN THE, THE CAPITAL OUTLAY NUMBER THAT WE'RE SEEING ON SLIDE 28 UP HERE, UH, VE REPLACEMENT VEHICLES, THE 3.4 MILLIONS A PIECE OF THAT THAT WE TALKED ABOUT.
TRASH TRUCKS, DUMP TRUCKS, ONE TONS, UH, STREET SWEEPERS, SOME OF THOSE KINDS OF VEHICLES THAT ARE GONNA BE REPLACED AND THOSE ARE REPLACED OUT OF THE FUND WHERE LEASE RATES ARE PAID ON THE VEHICLES.
SO OVER THE LIFE OF THAT VEHICLE, A LEASE RATE IS PAID FOR THAT SPECIFIC UNIT NUMBER FROM THAT SPECIFIC DEPARTMENT THAT GOES INTO THE FUND SO THAT IT'S, WHEN IT'S TIME TO REPLACE IT, THE BULK OF THE FUNDS ARE THERE.
ANY SHORTAGE WOULD COME OUTTA CAPITAL IF NECESSARY FROM THAT DEPARTMENT.
THAT ONLY COVERS REPLACEMENTS, NEW VEHICLES COME OUT OF CAPITAL.
THEN ONCE THEY'RE PURCHASED THEY START PAYING A LEASE RATE ON THAT VEHICLE TO FUND ITS REPLACEMENT IN THE FUTURE.
POLICE AND FIRE AND ELECTRIC ARE ALSO IN HERE.
THEY HANDLE THEIR FLEET, THEIR ACCOUNTS ON THEIR SIDE FLEET.
IN THAT PURPOSE, MY DEPARTMENT SERVES AS AN OVERSIGHT TO MAKE SURE THAT THEY'RE BUYING AND GETTING THINGS THAT WE CAN SUPPORT, REPAIR AND THEY MEET THE SPECIFICATIONS FOR THE CITY AND WE ALREADY HAVE SOFTWARE AND THOSE KINDS OF THINGS AVAILABLE FOR INSTEAD OF HAVING TO BUY ADDITIONAL SITE LICENSES TO REPAIR THE VEHICLES.
AJ SO HOW DOES YOUR EARLIER STATEMENT, NO NEW VEHICLES, HOW DOES THAT IMPACT THAT 7.3 MILLION? WELL THIS WAS, UH, PROBABLY PREPARED UM, PRIOR TO US COMING UP WITH THAT.
SO, UM, IT WOULD IMPACT IT AGAIN, UH, I DON'T THINK THIS HAS BEEN AMENDED.
THAT NUMBER HAS BEEN REDUCED BASED ON ANY PARTICULAR DEPARTMENT DIRECTOR UM, UH, FEEDBACK.
IS THAT CORRECT? THAT'S CORRECT, YEAH.
IT WOULD LIKELY IF YOU, IF THAT WAS SOMETHING THE COUNCIL WANTED TO FOLLOW THROUGH, IT WOULD LIKELY BE REDUCED AND POTENTIALLY PRETTY SIGNIFICANTLY THE IMPACT WOULD BE THE FUND BALANCE WOULD BE CONSIDERABLY LARGER.
AND WHAT, THAT'S WHY UH, IF I DIDN'T SAY IN THE GENERAL FUND I SHOULD HAVE, IT DOESN'T HAVE A BIG IMPACT ON THE GENERAL FUND BECAUSE OF THE WAY WE HAVE THE FLEET.
IT JUST HAS AN OVERALL IMPACT ON THE HEALTH OF THE CITY.
ANY OTHER QUESTIONS? SO WE UM, I'M JUST TRYING TO UNDERSTAND.
SO WE, WE SPEND ABOUT SEVEN OR 8 MILLION A YEAR, AT LEAST THE LAST THREE YEARS.
IT DEPENDS ON THE CAPITAL OUTLAY FOR THE OTHER DEPARTMENTS.
A FIRE APPARATUS IS A BIG EXPENSE.
THAT WOULD SHOW UP AS AN EXPENSE OUT OF THAT 5, 6 4 FUND AFTER FIRE TRANSFERRED THE MONEY IN TO PURCHASE IT.
AND LIKE WHAT'S THE MOST YOU'VE EVER SEEN US SPEND IN A YEAR-ISH AVERAGE FOR? WHAT I TYPICALLY MANAGE WITH THE GENERAL FLEET IS BETWEEN THREE AND A HALF AND $4 MILLION A YEAR.
ON THE HIGH END WE'VE SEEN YEARS AS LOW AS 2 MILLION COVID CREATED A BUBBLE FOR US WHERE THERE WERE NO VEHICLES AVAILABLE AND WE COULDN'T REPLACE ANYTHING.
SO WE GREW A FUND BALANCE IN THOSE TWO AND A HALF, THREE YEAR WINDOWS 'CAUSE THERE WAS NO AVAILABILITY.
NOW THOSE VEHICLES ARE OVERDUE FOR REPLACEMENT AND WE'RE STARTING TO RUN INTO THOSE RAMPING UP AND HAVING TO REPLACE SOME OF THOSE IN ADDITION.
AND I KNOW TWO BACK THERE HAVE HAD SOME, SOME PURCHASES THEY'VE MADE AS WELL THE TWO CHIEFS AS WELL.
UM, JUST TRYING TO THINK ABOUT, SO DO YOU HAVE A POLICY ON OR ANY OF THOSE RESERVES RESTRICTED TO COVER A CERTAIN AMOUNT OF REPLACEMENT OR LIKE A RAINY DAY SCENARIO KIND OF THING? OR CASE THE GENERAL FUND RESTRICT ARE RESTRICTED RESERVES BECAUSE THAT'S WHAT THE MONEY'S BEEN PUT BACK FOR SPECIFICALLY.
SO WHEN WE REPLACE A VEHICLE, IT DOESN'T IMPACT THE GENERAL FUND.
IT'S SOUNDS AND I'VE BEEN TOLD THAT'S THE BEST PRACTICE BY THE WAY.
SO KUDOS TO WHOEVER ESTABLISHED THAT YEARS AGO.
[01:30:01]
AS YOU GUYS, I DON'T KNOW, BUT, UM, HEARD FROM FINANCIAL PEOPLE THAT THAT'S OUR CITY DOES IT THE BEST WAY ANYBODY DOES IT.SO THAT'S, UH, THAT'S GOOD FROM A FINANCIAL STANDPOINT, I'M JUST LOOKING AT THE FUND BALANCE AND UM, TRYING TO UNDERSTAND IT, YOU KNOW, WHERE WHEREAS THE OTHERS HAD SOME BUILT IN 120 DAYS OR WHATEVER.
UM, TRYING TO UNDERSTAND IF THERE'S ANY, YOU KNOW, SET ASIDE FOR SOME WORST CASE THERE OR ANYTHING.
WE DON'T HAVE ANY OPERATIONS SET ASIDE HERE.
IT'S STRAIGHT FOR THE ASSETS, THE PURCHASING AND ACQUISITION OF THE VEHICLES.
AND I CAN SEND YOU A BREAKDOWN BY DEPARTMENT IF YOU'D LIKE TO SEE THAT ON THE INDIVIDUAL DOLLAR AMOUNTS FOR EACH ACCOUNT.
I THINK THIS IS A REAL GOOD NEWS STORY THOUGH, AND IT'S BEEN WELL MANAGED, SO GOOD JOB.
ANY OTHER QUESTIONS? THANK YOU BOBBY.
OKAY, SO WE'RE BACK TO OUR FINAL ITEM GLOSSARY OF TERMS, WHICH WAS A REQUEST OF THE BUDGET REFORM COMMITTEE.
SO I DID PUT TOGETHER, UM, I HIGHLIGHTED A FEW THINGS THAT WE HAD QUESTIONS ABOUT AND THEN DID ATTACH THE WHOLE UPDATED GLOSSARY.
SO I'LL TRY TO GO THROUGH THIS QUICKLY 'CAUSE I KNOW YOU DO HAVE ANOTHER AGENDA ITEM THAT MIGHT TAKE A MINUTE TO DISCUSS.
SO, UM, CAN WE, CAN WE KIND OF SHORTEN THIS ONE UP AND JUST SAY IF WE'VE GOT ANY SPECIFIC QUESTIONS, UM, THAT I THINK NEED TO BE THROWN ON THE TABLE, THROW 'EM OUT THERE RIGHT NOW.
OTHERWISE I THINK WE CAN HAVE SOME OFFLINE CONVERSATIONS ABOUT VERBIAGE OR DEFINITION, UM, THINGS LIKE THAT BECAUSE THIS IS, THIS IS OBVIOUSLY, AS WE'VE TALKED ABOUT ON MULTIPLE OCCASIONS NOW IS GONNA BE A LIVING BREATHING DOCUMENT WHEN WE TALK ABOUT GLOSSARIES.
UM, I WOULD JUST SAY, DOES ANYBODY HAVE ANY, ANYTHING THAT JUST SCREAMS AT 'EM THAT NEEDS TO BE EXPLAINED? I MEAN, I THINK THERE'S, WE PROBABLY OUGHT TO KIND OF CLEAN UP A FEW PIECES IN HERE WHERE WE'VE ACTUALLY PULLED THE EXACT STATE STATUTE AND TO MAKE IT A LITTLE CLEARER FOR THE CITIZENS, WE COULD JUST KIND OF CLEAN IT UP.
SO IT JUST TALKS ABOUT THE WAY THE CITY OF EDMOND LOOKS AT IT.
BUT I THINK OTHERWISE, I I THINK WE'RE MOVING IN THE RIGHT DIRECTION HERE.
ANY OTHER THOUGHTS? I JUST WANNA HIGHLIGHT ON SLIDE 32, THIS IS KIND OF THE KEY TO ME AT THE BOTTOM, THE, THE HIERARCHY OF FINANCIALS.
SO FUND DEPARTMENT, CATEGORY, LINE ITEM, LIKE THAT'S THE BASICS OF THIS IS MY BRAIN UNDERSTANDING KIND OF HOW THIS IS ALL, HOW THIS ALL FITS TOGETHER.
AND THEN THERE'S ALSO, YOU KNOW, WE TALK ABOUT OBJECTS, UM, AND THAT'S KIND OF AQUEST A TERM I WERE TALKING ABOUT THE OTHER DAY.
SO WE MAY HEAR OBJECTS USED IN CONJUNCTION, BUT CATEGORIES OR LINE ITEMS. BUT TO ME, LIKE THOSE ARE THE BIG FOUR TERMS THAT WE USE WHEN WE TALK AND WE ALL NEED TO BE USING WHEN WE COLLECTIVELY TALK ABOUT FINANCIAL STUFF IS LIKE WHAT LEVEL WE'RE WE'RE TALKING ABOUT HERE.
AND I MIGHT ADD TOO, UM, I BELIEVE AJ'S MENTIONED WE'RE REALLY ARE GONNA WORK TO LOOK AT OUR FUND STRUCTURE OVER THE COURSE OF THIS NEXT YEAR AND REALLY CLEAN UP EVERYTHING SO THAT IT FITS INTO ONE OF THOSE, THOSE DIFFERENT PLACES.
AND, UM, AND TO REALLY BE CONSISTENT ON USING LINE ITEM INSTEAD OF OBJECT CODE OR, AND WE CAN CERTAINLY TALK OFFLINE TOO, ON WHICH YOU WOULD PREFER.
BUT YEAH, THOSE ARE GONNA BE THE MAJOR, UH, DIVISIONS.
AND WE DO HAVE ONE OTHER THING.
I PUT A A DEFINITION IN HERE OF DIVISION.
DIVISION WOULD GO UNDER A DEPARTMENT.
YOU CAN HAVE A DIVISION THAT ALL ROLL UP INTO ONE DEPARTMENT, BUT IT'S, THE GOOD EXAMPLE IS POLICE WHERE YOU HAVE A PATROL DIVISION.
IT'S, IT'S REALLY MORE THE DEPARTMENT WANTS TO KEEP TRACK OF SOMETHING SEPARATELY, BUT IT, IT, ALL OF THOSE ARE GONNA ROLL UP INTO THE DEPARTMENT.
SO TYPICALLY YOU WOULDN'T SEE A DIVISION, YOU KNOW, BUDGETED BY ITSELF.
AND THEN JUST MAYBE IT'S OBVIOUS TO EVERYBODY, BUT IT WASN'T TO ME AT FIRST, DEPARTMENTS CAN DRAW OFF FUND FUNDS MONEY FROM DIFFERENT FUNDS AND UM, THE CATEGORIES HERE LISTED ARE LIKE THE ONES WE JUST LOOKED AT, PERSONAL SERVICES MATERIALS, RIGHT.
THERE'S LIKE FOUR OF 'EM, SO CAPITAL.
OKAY, THIS, SO NOW, OH YEAH, WE WERE GONNA GO THE TIMELINE.
ONCE AGAIN, IF YOU HAVE ANY QUESTIONS, LET ME KNOW.
WE ALREADY TALKED ABOUT ALL THIS.
IT WAS REALLY JUST HOLDING OUT APRIL 20TH IF WE NEED IT.
IF WE DON'T NEED IT, WE WON'T USE IT SO QUICKLY ON THE 23RD WE'RE GONNA DO WATER, WE'LL REVISIT WATER AND WASTEWATER FUND AS PART OF THAT, WE'LL LOOK AT THE CAPITAL PROPOSED CAPITAL PLAN, UH, PLANT EXPANSIONS, ET CETERA.
AND THEN WE'LL ALSO LOOK AT THE RATE STUDY.
THAT'LL BE THE FIRST OPPORTUNITY FOR THE COUNCIL AS A WHOLE,
[01:35:01]
UM, TO LOOK AT THAT RATE STUDY.I ANTICIPATE THAT IS PROBABLY 90 OR SO MINUTES, UM, BETWEEN THOSE TWO ITEMS, COUNCIL AND MORE AND PR.
UM, SO WE'RE GOING TO DO THAT AND THEN I THINK BASED ON A COUPLE OF EMAILS THAT I'VE SEEN AND, AND, UH, KATHY SENT TO YOU GUYS A WHILE AGO, A BREAKDOWN, UH, OF THE, PARTICULARLY THE GENERAL FUND WHERE SHE ALSO SHOW SHOWED, UH, 24, 25 ACTUALS, 25, 26 ADOPTED AND 26 27 PROPOSED.
SO YOU CAN SEE GROWTH OR, OR REDUCTIONS OVER TIME.
I'M, I'M IMAGINING THAT YOU'RE GOING TO WANT TO REVISIT, UH, THE GENERAL FUND AT LEAST SEE SOME OF THE DEPARTMENTS.
IS IS THAT SAFE TO SAY? MM-HMM
AND DO YOU KNOW, OR DO YOU WANT TO EMAIL ME AND TELL ME WHAT, UH, WHAT THOSE WILL BE? OR YOU, OR DO YOU JUST WANT TO HEAR FROM EVERY DEPARTMENT DIRECTOR? UH, IRRESPECTIVE OF FUND, YOU JUST WANT TO HEAR FROM EVERY DEPARTMENT DIRECTOR WHO WOULD WALK YOU THROUGH A, A SIMILAR KIND OF, UH, A PRESENTATION.
WHY DON'T YOU SEND US A LIST OF ALL THOSE GENERAL FUND DEPARTMENTS AND LET US REVIEW 'EM AND SAY, WHICH, WHICH ONES DO WE WANT TO TALK ABOUT SPECIFICALLY? UM, BECAUSE I THINK EVENTUALLY, YOU KNOW, WHEN WE GET DOWN TO, UM, THAT MAY 4TH DATE SHOWING HERE THAT I THINK THE WAY PRESTON AND I WORKING WITH OUR REFORM COMMITTEE, WE ENVISION BEING ABLE TO SEE EACH DEPARTMENT AS WE SEE IT ON THE ORG CHART WITH HERE'S THEIR PERSONAL SERVICES, HERE'S THE MATERIALS AND SUPPLIES, HERE'S THEIR OTHER OPERATING IF THEY HAVE CAPITAL AND HOW IT'S FUNDED.
AND ME PERSONALLY, I DON'T KNOW HOW EVERYBODY ELSE FEELS, BUT ME PERSONALLY, I DON'T EVEN NECESSARILY WANNA SEE IF IT'S SPLIT BETWEEN MULTIPLE FUNDS, HOW THE FUNDS ARE PAYING ON EACH OF THOSE FOUR CATEGORIES.
AS MUCH AS I JUST WANNA SEE THE TOTAL DOLLAR AMOUNT OF THE FUNDS THAT'S BEING USED, UH, IT SOUNDS LIKE YOU, YOU JUST REALLY WANT BASICALLY A SET OF TRUE EXPENDITURES SETTING ASIDE FOR THE MOMENT, HOW THEY'RE SMALL LEFT, AND THEN THE TOTAL FUND AMOUNT THAT TOTALED UP HOW IT PAYS FOR THOSE WITHOUT BREAKING IT DOWN INTO THE CATEGORIES OR OBJECT CODES OR ANYTHING ELSE.
I MEAN, I FEEL LIKE IF WE'RE SEEING THAT AND THAT'S WHAT WE'RE APPROVING AS A BUDGET, IT'S UP TO YOU AND YOUR TEAM TO CRAFT THOSE OBJECTIVE EXPENDITURE, THOSE LINE ITEMS AND CARRY OUT THE MISSION.
UM, OTHER THOUGHTS, OTHER NEEDS, AND I'M JUST ASSUMING WE'RE GOING TO, I MEAN, I, I WROTE DOWN A COUPLE OF NOTES.
I KNOW YOU WANT TO TALK, THE COUNCIL WANTS TO TALK AGAIN ABOUT THE PROPOSED, UH, UH, OR AT LEAST THE, THE CITY LINK REDUCTION OPTION, RIGHT? YOU WANT TO WANT TO HAVE A LITTLE MORE CONVERSATION ABOUT THAT? I THINK YOU BASICALLY TOOK THE NONPROFIT REDUCTIONS OFF THE TABLE TODAY.
I'M ASSUMING THERE'S NO QUESTION WE'RE GONNA SPEND TIME ON ADDITIONAL TIME ON POLICE AND FIRE.
IS THAT FAIR TO ASSUME? MM-HMM
UM, WE DISCUSSED CITYLINK BRIEFLY BEFORE YOU SPEND TIME ON LOOKING AT THAT.
ARE YOU TALKING ABOUT THE FOUR? IT'S LIKE 4 95, 4 95 THAT NOT THE ROUTE REDUCTION AT 1 MILLION, RIGHT? CORRECT.
MY, MY SENSE IS THE COUNCIL TOOK THE, THE $1 MILLION REDUCTIONS OFF THE TABLE.
AND THE 1.495 MILLION OFF THE TABLE.
SO THE ONLY THING THAT SURVIVED FROM OUR FIRST ROUND DISCUSSION WAS THE 495,000.
IS THAT OUR UNDERSTANDING? MM-HMM
YOU SAID YOU TOOK THOSE TWO OFF THE TABLE AND THE ONLY ONE THAT SURVIVED WAS THE 4 95 FOR NOW? YES.
I MEAN, IT'S, IT'S, IT'S BARELY SURVIVING WITHIN IN MY BOOKS,
I MEAN, I I'M NOT TRYING TO BE FUNNY.
I WANT TO GET YOU THE INFORMATION THAT YOU WANT.
SO YOU, YOU FEEL LIKE YOU CAN MAKE INFORMED
[01:40:01]
DECISIONS ABOUT, UH, THE BUDGET.I UNDERSTAND, UH, WHAT THE MAYOR DESCRIBED AS THAT, THAT LIST OF, OF REALLY CITYWIDE EXPENDITURES.
UM, WHAT ELSE? I KNOW WE'RE GONNA TALK ABOUT POLICE AND FIRE.
WHAT ELSE? I MEAN, AND I, WHERE WE COVER, WE'RE GONNA SPEND A FAIR AMOUNT OF TIME ON WATER WASTEWATER CAPITAL AND RATE STUDY.
AND THEN BY VIRTUE OF THOSE CONVERSATIONS, THEN CIRCLE BACK AND COMPLETE THE WATER AND WASTEWATER, UH, UTILITY FUNDS.
ANYTHING ELSE? ANYBODY? IT'S NOT LIKE YOU CAN'T ADD TO IT.
I, BEFORE WE, I MEAN, WHAT DO WE GOT? FOUR, FIVE MORE OF THESE OF WORKSHOPS.
SO WE ARE, WE'RE, WE'RE PLANNING ON MARCH 23RD, MARCH 30TH, AND THEN APRIL 13TH.
SO WE CAN, WE CAN ALWAYS CIRCLE BACK FOR SOMETHING ABOUT YEAH, OF COURSE.
BEFORE WE MOVE ON, I WANT TO THANK YOU AND STAFF WE, WELL, AND THE REFORM COMMITTEE THAT PRESTON AND I BOTH WORKED WITH.
I WANNA THANK EVERYBODY FOR WHERE WE ARE TODAY.
UM, I KNOW WE'RE NOT EXACTLY WHERE I WANT TO BE.
I THINK THERE'S STILL SOME THINGS WE CAN IMPROVE, BUT THE, THE LEAP FORWARD THAT WE HAVE MADE TO GET US HERE HAS BEEN REALLY BIG.
UM, IT'S MADE IT A WHOLE LOT EASIER FOR WHAT WE JUST ASKED FOR TO GET WHERE WE ARE.
UM, KATHY, YOU AND YOUR STAFF HAVE, HAVE JUST DONE SOME INCREDIBLE WORK AND, AND I THINK WE ALL REALLY APPRECIATE WHEREVER MATTS THERE HE IS,
KATHY HAS CERTAINLY DONE HARD WORK, RANDY, OR BACK, BUT THIS WOULD NOT HAVE BEEN POSSIBLE WITHOUT MATT.
SO IF ANYONE HAS AN A, A CHAIN AVAILABLE TO LOCK HIM TO THE DAY AS WE OUGHT TO THINK ABOUT DOING THAT.
I DO WANNA POINT OUT TOO, MATT SPENT AN HOUR WITH ME THE OTHER NIGHT, OTHER DAY WALKING THROUGH QUESTCO, WHICH IS OUR BUDGETING SOFTWARE THAT THE CITY HAS NOW.
AND, UM, I MENTIONED IN THE LAST MEETING ABOUT HAVING A LITTLE MORE DETAIL WHAT'S GOING ON KIND OF UNDER THE HOOD ON THIS.
AND SO THERE'S A REPORT THAT KATHY HAD PRINTED FOR US HERE COMPARING PREVIOUS YEARS.
MATT WAS ABLE TO SHOW ME HOW TO ACCESS, YOU KNOW, THE DETAILS BENEATH EACH CATEGORY.
JUST SO EVERYBODY KNOWS, WHEN I USED TO SIT OUT THERE, I WAS LIKE, WHERE'S THE DETAIL? IT DOES EXIST IF YOU WANNA SEE IT, YOU KNOW, IT'S, IT'S FINDABLE, UH, IF YOU TALK TO ONE OF THEM, BUT ALSO JUST FOR US, APPRECIATE HAVING THAT AVAILABLE AND YOU WELCOME ME THROUGH THAT.
IT GIVES US CONFIDENCE TO SEE WHAT'S UNDER THE HOOD A LITTLE BIT SO WE UNDERSTAND IT.
AND SO WE CAN DEFEND IT TO PEOPLE THAT WERE MAKING SMART DECISIONS HERE.
NOW BEFORE WE MOVE ON TO ITEM THREE ON THE AGENDA, I'D ENTERTAIN A MOTION TO TAKE A SHORT BREAK TO SAY THREE 50.
YOU GOTTA HIT, HAVE A MOTION FIRST.
OKAY, I'M ASSUMING THAT MOTION AND WE'RE BACK.
YOU WANNA MAKE, YOU WANNA MAKE A MOTION OVER THERE? MOTION TO RESUME.
I HAVE A MOTION TO SECOND CAST YOUR VOTE.
[3. Discussion of Development Incentive Agreement with Covell-35 Development, LLC for Development of the Legacy at Covell Retail Shopping Complex.]
ON ITEM THREE.UH, THIS IS THE, LEMME GET BACK OVER TO MY AGENDA, EVERYBODY.
THIS IS A DISCUSSION OF DEVELOPMENT INCENTIVE AGREEMENT WITH COVE 35 DEVELOPMENT LLC FOR DEVELOPMENT OF THE LEGACY AT COVE RETAIL SHOPPING COMPLEX, MR. KRIEGER.
WE WANT TO DO A COUPLE OF DIFFERENT THINGS AS PART OF THIS ITEM.
AND WE HAVE A FEW, UH, GROUPS WITH US TODAY FROM A CITY STAFF STANDPOINT.
UM, UH, LENA WILL MAKE A, UH, A QUICK PRESENTATION THEN WE UNDERSTAND THE EEDA, UH, HAS A PRESENTATION THEY WOULD LIKE TO MAKE.
UM, WE OBVIOUSLY WANNA LEAVE SOME TIME FOR DISCUSSION, SO WE'LL TRY AND BE, UH, UH, FAIRLY BRIEF OR, OR FAIRLY CONCISE IN HOW WE, UH, PRESENT.
BUT THERE'LL BE AN OPPORTUNITY TO WALK THROUGH THE AGREEMENT TO THE EXTENT YOU WANT TO DO THAT.
[01:45:01]
THERE'LL BE AN OPPORTUNITY TO TALK ABOUT, UH, REVENUE GENERATION.UH, I KNOW YOU'LL WANT TO DO THAT.
AND THERE'LL ALSO BE AN OPPORTUNITY TO HEAR, UH, FROM THE DEVELOPER AS WELL.
I, I SHOULD HAVE POINTED OUT A SECOND AGO, THE DEVELOPER IS IN THE ROOM.
AND SO, UM, LET ME FIRST SORT OF OWN MY PART IN THIS.
THIS HAS BEEN, UM, AN INTERESTING PROJECT, UM, FOR ME TO, TO START MY TENURE, UH, WITH THE CITY.
AND, UM, NOW KNOWING THAT THE, THE COUNCIL, UH, THE PREFERENCE WOULD REALLY HAVE BEEN FOR A STRUCTURED DISCUSSION LIKE THIS PRIOR TO IT APPEARING ON THE AGENDA, UH, I WILL OWN, UH, THAT PART OF IT.
I SHOULD HAVE PROBABLY TAKEN A LITTLE MORE CARE AND CAUTION, UH, TO ASK EACH OF YOU HOW YOU WOULD LIKE TO PROCEED, UH, BEFORE THE, UH, ITEM APPEARING ON A, UH, COUNCIL AGENDA.
UM, I KNOW THERE ARE SOME THRESHOLD QUESTIONS WE WANT TO GET TO, LIKE, YOU KNOW, WHY DO WE NEED TO OFFER INCENTIVES AT ALL? WHAT DOES THE MARKETPLACE KIND OF REQUIRE? I'LL HOLD THOSE FOR NOW AND, AND LEAVE THOSE AS AREAS THAT WE CAN GET INTO ONCE WE'VE HAD A CHANCE TO HEAR ABOUT THE AGREEMENT ITSELF AND THEN THE EE D'S PRESENTATION AND WE'LL BE ABLE TO GO FROM THERE.
DOES THAT FAIR? DOES THAT WORK? OKAY, LENA, GOOD AFTERNOON, MAYOR AND CITY COUNCIL.
I'M JUST GONNA RUN THROUGH REALLY QUICKLY, LIKE AS AJ SAID, UM, THE TERMS OF THE AGREEMENT.
MS. DOZIER, PULL THAT MICROPHONE UP PLEASE.
SORRY, IT SOUNDS SO LOUD OVER HERE.
UM, THE TERMS OF THE AGREEMENT, UM, THIS IS A RETAIL COMPLEX AT THE INTER AT THE, LOCATED AT INTERSTATE I 35 IN COVELL OF APPROXIMATELY 250,000 SQUARE FEET OF RETAIL SPACE.
THERE WILL BE NINE TARGETED RETAILERS.
UM, TWO OF THOSE ARE GOING TO BE PRIORITY ANCHOR RETAILERS, TENANTS, AND WE WILL GO THROUGH WHAT THAT MEANS IN JUST A MOMENT OF DICK'S SPORTING GOODS AND WHOLE FOODS.
WE HAVE HOBBY LOBBY, TEXAS ROADHOUSE, COOPER'S HAWK, OR RUTH'S, CHRIS PETSMART, BARNES AND NOBLE, OR A SUBSTITUTE RETAILER, SHAKE SHACK, CHIPOTLE AND OTHERS TO BE DETERMINED.
THE MAXIMUM INCENTIVE FOR THIS PROJECT IS $17 MILLION, UM, THAT WILL BE SPLIT BETWEEN THE NINE RETAILERS, UM, WITH AN INCENTIVE OF JUST OVER $1.8 MILLION FOR EACH RETAILER.
THE PRIORITY ANCHOR TENANT, UM, IS THE, IS THERE TWO THAT WE'VE SPOKEN ABOUT? DICK'S SPORTING GOODS AND WHOLE FOODS? UM, THE DEVELOPER WILL NOT RECEIVE ANY OF THE INCENTIVE UNTIL THOSE TWO PRIORITY RETAIL TENANTS ARE COMPLETED.
AND WE'LL GO THROUGH WHAT COMPLETED MEANS IN THE NEXT SLIDE.
THE OPENING INSTALLMENT OF THE INCENTIVE IS 50% OF THE INCENTIVE WILL BE GIVEN TO THE DEVELOPER AFTER FOUR THINGS.
THREE THINGS, FOUR THINGS ARE COMPLETED FOR THE RETAILER.
THAT IS A CERTIFICATE OF OCCUPANCY IS ISSUED BY THE CITY.
THE RETAILER WILL OCCUPY THE PREMISE WITHIN THE PROJECT.
THE RETAILER IS OPEN FOR BUSINESS TO THE GENERAL PUBLIC AND HOLDS A VALID OKLAHOMA SALES TAX PERMIT.
AFTER THEY HAVE COMPLETED ALL THAT, THAT'S WHEN THEY GET THEIR, WITHIN 30 DAYS, THEY'LL GET THEIR 50% OF THE 1.88 MILLION.
UM, AND THEN 180 DAYS AFTER THE OPENING OF THEIR FIRST INCENTIVE PAYMENT, THEY WILL GET THE REMAINING 50%.
THIS ENSURES THAT THE RETAILER STAYS OPEN.
UM, I JUST WANTED TO REAL QUICK GIVE A MAP OF THE PROJECT LOCATION AND OPEN IT UP FOR ANY QUESTIONS OR PASS IT OVER TO EEDA.
BEFORE WE GET INTO QUESTIONS, LET'S HAVE, LET'S HAVE HEATHER, WE DIAL WITH EEDA.
UM, I KNOW SHE WANTS TO ADD A LITTLE BIT TO THIS AND THEN, UH, I BELIEVE SHE WANTS JENNIFER SPRINGER, WHO'S BEEN WORKING ON ANALYSIS OF THIS FOR QUITE A WHILE.
TO THROW SOME ADDITIONAL INFORMATION OUT FOR US.
THANK YOU MAYOR AND COUNCIL MEMBERS FOR ALLOWING US TO PARTICIPATE TODAY.
ONE, AS, AS LENA OUTLINED, THIS PROJECT IS TRULY A CATALYTIC RETAIL DEVELOPMENT FOR EDMOND.
AND YOU MIGHT ASK, WHAT DO I MEAN BY CATALYTIC? WELL, IT'S A COUPLE OF THINGS.
ONE, THESE LARGE ANCHOR TENANTS ARE REGIONAL DRAWS, RIGHT? SO PEOPLE OUTSIDE OF OUR COMMUNITY WHO MIGHT HAVE OTHERWISE PASSED UP ON OUR COMMUNITY ARE NOW STOPPING.
SO IT'S DESTINATIONAL TWO, WE KNOW THAT INVESTMENTS LIKE THIS, THEY TRIGGER AND INFLUENCE LARGER CORRIDOR DEVELOPMENT.
WE'RE TALKING ABOUT ONE SITE TODAY, BUT IN REALITY WE KNOW THAT, THAT I 35 CORRIDOR IS MUCH LARGER.
THREE, I THINK THIS PROJECT SIGNALS THAT EDMOND IS OPEN FOR BUSINESS, OKAY? WE ARE SERIOUS ABOUT ATTRACTING
[01:50:01]
HIGH QUALITY RETAIL AND IT ALSO SIGNALS THAT WE'RE AT A TIME WHERE WE CAN NOW SUPPORT THIS TYPE OF INVESTMENT.IF WE STUDY OTHER COMMUNITIES, OUR FRIENDS AND NEIGHBORS IN OKLAHOMA AND SURROUNDING, WE KNOW THAT WHEN THESE LARGE ANCHORS COME TO TOWN, IT'S A DOMINO, IT'S A TRICKLE EFFECT.
OTHER PEOPLE WANNA SURROUND THEMSELVES BY THEM.
RIGHT NOW WE'RE DISCUSSING TODAY WAS JUST NINE.
WE KNOW THAT THE SITE CAN SUPPORT WELL OVER 20.
AND WE KNOW THAT WHEN ALL 20 OF THOSE ARE FULLY DEVELOPED, THE DEVELOPER WILL HAVE SEEN JUST IN THE RETAIL PORTION OF THIS WELL OVER 107 MILLION OF PRIVATE CAPITAL INVESTMENT IN OUR COMMUNITY.
THE LANDSCAPE OF RETAIL HAS CHANGED SIGNIFICANTLY IN THE LAST TWO DECADES.
THERE WAS A TIME YOU PROBABLY DIDN'T HAVE TO INCENTIVIZE RETAIL.
WE'RE NOT IN THAT GAME ANYMORE.
LARGE ANCHOR RETAILS REQUIRE SIGNIFICANT UPFRONT CAPITAL INVESTMENT COSTS AND IT IS NOW BECOMING COMMON PRACTICE NATIONALLY FOR THEM TO HAVE SOME PUBLIC SUPPORT FROM THAT.
I WANT TO INVITE JENNIFER SPRINGER AS THE MAYOR OUTLINED, WE HAVE BEEN STUDYING THIS PROJECT FOR QUITE SOME TIME.
EDA CONTRACTS OUT TO JENNIFER AS OUR CONSULTANT FOR ECONOMIC IMPACT MODELING.
SHE WORKED AT THE OKLAHOMA DEPARTMENT OF COMMERCE RUNNING PROJECTS FOR 14 YEARS.
AND I WANT JENNIFER TO COME UP AND TALK ABOUT THE NUMBERS AND THE SIGNIFICANCE OF THOSE NUMBERS.
SO FIRST I WANNA TALK ABOUT THE ANALYSIS THAT I DID FOR PROJECT LANDING.
SO WE ANALYZE, UH, LOOKING AT THE DEAL, UM, THAT'S BEEN PRESENTED.
AND FIRST I WANNA TALK ABOUT METHODOLOGY JUST SO THAT YOU HAVE AN UNDERSTANDING OF THE MODEL THAT WE USED IN ITS RELIABILITY.
UH, IT IS A MODEL THAT WAS DEVELOPED IN THE 1970S.
IT'S THE INPUT OUTPUT MODEL THAT MOST ECONOMISTS USE WHEN EVALUATING CHANGES IN THE ECONOMY.
UM, OUR MODEL IS TWEAKED AND UPDATED ANYTIME THERE IS A NEW DATA RELEASE.
SO WE ARE USING, UH, THE MOST ACCURATE INFORMATION ON WAGES, UH, POPULATION DATA, THAT SORT OF THING.
THIS MODEL IS USED, WE USED IT AT THE STATE ANYTIME WE WERE EVALUATING, UH, A PROJECT THAT WAS CONSIDERING COMING TO OKLAHOMA AS WELL AS COMMUNITIES AROUND THE STATE AND MUNICIPALITIES.
SO IT'S ONE OF THE MOST WIDELY USED MODELS.
AND SO I WANTED TO MAKE SURE YOU KNEW THAT.
UM, JUST SO THAT YOU HAVE SOME CONFIDENCE IN THESE NUMBERS WHILE YOU GUYS ARE, UH, LOOKING TO MAKE A DECISION.
SO PROJECT LANDING, I CONSIDERED NINE TENANTS WITH A LITTLE OVER A HUNDRED MILLION DOLLARS IN SALES.
I MODELED THESE TO WHERE YEAR ONE WOULD BE ALL NINE OPEN FOR AN ENTIRE YEAR.
AND WE HAD TO DO THAT JUST SO THAT OUR DATA, UH, WAS A LITTLE BIT MORE CLEANER, UM, WHEN WE DID THAT.
SO WHAT I WAS ABLE TO ANALYZE FOR ALL OF THEM TO BE OPERATIONAL BETWEEN YEAR FOUR AND YEAR FIVE WOULD BE THE BREAK EVEN POINT FOR THE $17 MILLION MAXIMUM INCENTIVE THAT WOULD BE OFFERED, MEANING YOU WOULD RECOUP THAT BACK AND, AND LOCAL SALES TAX BEING GENERATED COMING BACK, UH, OFF THIS PROJECT.
THAT IS ONLY THE NINE TENANTS I CONSIDERED.
I KNOW THERE'S OTHERS THAT ARE LOOKING AT THAT, AT THAT SITE, UH, TO, TO BE ADDED TO THAT.
BUT JUST SO THAT YOU KNOW, ONLY THOSE NINE WERE CONSIDERED BASED ON THEIR AVERAGE SALES.
UH, LAST, THE NUMBER THAT I WANTED TO PRESENT IS THE TOTAL ECONOMIC IMPACT NUMBER.
SO WHAT THIS IS, UH, AN ECONOMIC IMPACT NUMBER IS THE MODEL IS CALCULATING A CHANGE IN THE ECONOMY, AND IT IS PUTTING A DOLLAR AMOUNT TO THAT OF WHAT THIS PROJECT WOULD BRING.
IT'S THE DIRECT COST, WHICH IS WHAT THE, THESE COMPANIES ARE DOING OR WHAT THIS PROJECT IS DIRECTLY DOING IN THE ECONOMY.
IT'S THE INDIRECT COST, WHICH IS ALL THE INTERACTIONS THESE BUSINESSES ARE HAVING WITH OTHER BUSINESSES IN EDMOND'S ECONOMY.
THE INDUCED IS ALL THE PEOPLE THAT WORK THERE AND INTERACT WITH THOSE BUSINESSES, THEM SPENDING MONEY THAT THEY MAKE AND, UH, LIKE WAGES, UM, COMING BACK INTO THE ECONOMY.
SO THE ECONOMIC IMPACT NUMBER IS THE TOTAL OF THE DIRECT, THE INDIRECT IN THE INDUCED.
AND SO IF YOU LOOK AT OUR BREAK EVEN POINT OF WHEN THE CITY THAT 17 MILLION WOULD
[01:55:01]
BE GENERATED IN LOCAL SALES TAX, THIS PROJECT WOULD HAVE GENERATED 595 MILLION ALREADY IN ECONOMIC IMPACT FOR THE CITY OF EDMOND.WOULD ANYONE ON YOUR TEAM LIKE TO ADD ANYTHING TO THIS? AND I SEE EVERYONE POINTING AT TODD
WELL, I'LL BE HAPPY TO ANSWER ANY QUESTIONS.
WE'LL LET, WE'LL LET TODD COME UP HERE.
UH, RODDY HAS A LAW DEGREE AND A CPA LICENSE, SO HE WOULD BE BETTER PROBABLY FOR ALL OF US.
BUT, UH, LET ME, CAN I JUST GIVE US A HISTORY OF THIS LAND? IS THAT OKAY FOR JUST A MINUTE? UH, BECAUSE I THINK IT'S RELEVANT BECAUSE PEOPLE DRIVE BY THIS SITE AND LIKE, WELL, NOTHING'S HAPPENING OR SOMETHING HAPPENED, BUT WE'RE NOT SURE WHAT HAPPENED.
AND SO IF YOU DON'T MIND, UH, IT'S, IT'S A GREAT HISTORY LESSON.
UH, IN SEPTEMBER OF 2006, RODDY AND HIS TEAM BEGAN DOWN TO TAKE DOWN THE FIRST OF MULTIPLE PARCELS THAT EVENTUALLY INCLUDED THREE OF THE FOUR CORNERS OF THE INTERSECTION OF I 35 AND COVELL.
AROUND THAT SAME TIME IN, UH, MAY OF 2006, WE GOT A PUD PUT IN PLACE THAT DID COVER ALL THREE CORNERS OF COVELL AND I 35.
AND THAT BEGAN THE PROCESS OF WHAT THIS SITE WAS GONNA LOOK LIKE.
AND YOU THINK DEVELOPMENT TAKES A LONG TIME.
KEEP IN MIND, THAT WAS ALMOST 20 YEARS AGO BY COMPARISON AS AN EXAMPLE TO PROVE THAT THAT'S NOT UNCOMMON.
THE OAK, THE NEW HOT PROJECT IN OKLAHOMA CITY, IT WAS A 13 YEAR PROJECT JUST TO GET THE ZONING AND THE ENTITLEMENTS IN PLACE.
SO BIG PROJECTS TAKE A LONG TIME AND THEY TAKE A LOT OF MONEY, THE PRIVATE DOLLARS JUST TO GET THE LAND TAKEN DOWN AND FOR THE INITIAL DEVELOPMENT WAS OVER $34 MILLION BY RODDY AND HIS GROUP.
AND SO THAT BEGAN THIS IMMEDIATE PARTNERSHIP WITH THE CITY OF EDMOND.
THAT'S CONTINUED ADMITTEDLY TO THIS DAY, AND WE'VE WORKED THROUGH THIS ENTIRE PROJECT.
SO, UH, I EVEN HAVE A COPY I FOUND TODAY OF A LETTER THAT LARRY STEVENS WROTE TO THE CHAIRMAN OF DILLARD'S IN MAY OF 2007, IDENTIFYING ALL THE THINGS THE CITY OF EDMOND WAS GONNA DO TO VALE ROAD FROM I 35 TO MITCH PARK AND SOONER ROAD AND OTHER INFRASTRUCTURE.
THAT ADMITTEDLY DIDN'T QUITE HAPPEN, BUT WE HAD THE BEGINNINGS OF THOSE PARTNERSHIPS AS WE WORKED TOGETHER ON THIS PROJECT.
UH, SIMON PROPERTIES, THE WORLD'S LARGEST RETAIL SHOPPING CENTER OPERATOR WAS INVOLVED IN THE PROJECT IN 2007.
AND DAVID SIMON, THE HEAD OF THAT COMPANY, WAS THE LAST PERSON ON HIS TEAM TO FINALLY DECIDE THE RECESSION IN 2007 AND 2008 WAS REAL AND THEY PULLED OUT OF THE PROJECT, BUT THE PEOPLE CONTINUED TO WORK TOGETHER WITH THE CITY OF EDMOND AND THE CITY OF EDMOND'S BEEN A GREAT PARTNER AS WE'VE WORKED IN THIS PROCESS.
SO WE CONTINUED TO PURSUE THIS IDEA OF HOTEL CONFERENCE CENTER AND ENTERTAINMENT AND SPORTS AND RETAIL.
THAT'S BEEN THE GENESIS AND BEEN COMMUNICATED AND SOUGHT THROUGHOUT THE ENTIRE PROJECT.
IN APRIL OF 2012, THE CITY OF EDMOND AND THE DEVELOPMENT ENTERED INTO A PARTNERSHIP AGREEMENT IN THE FORM OF MOU.
THAT WAS THE MASTER AGREEMENT THAT WOULD OVERSEE WHAT WOULD HAPPEN WITH THE HOTEL CONFERENCE CENTER AND WITH POTENTIAL ENTERTAINMENT AND SPORTS AND RETAIL.
SO THAT WAS IN 2012 THAT THAT FIRST MOU WAS PUT IN PLACE.
AND SHORTLY AFTER THAT, THAT WAS, UH, IN MAY OF 2012.
IN NOVEMBER OF 2012, THERE'S A DEVELOPMENT AGREEMENT PUT IN PLACE FOR THE HOTEL CONFERENCE CENTER.
AND AS PART OF THAT, THE DEVELOPER AGREED TO SPEND ABOUT $28 MILLION TO BUILD THE HOTEL CONFERENCE CENTER.
THE CITY AGREED TO PROVIDE FUNDS THAT WERE INSTRUMENTAL TO THAT PROJECT AND OTHER INFRASTRUCTURE.
YOU'VE HEARD A LOT ABOUT THE INTERSECTION OF COVE AND SOONER, AND EVERYBODY THAT WE'VE TALKED TO DOESN'T MATTER IF IT'S BRUCE HARRIS OR CREST OR DILLARD'S OR WHOLE FOODS IS, IT'S A GOOD THING YOU DID THAT INTERSECTION BECAUSE WE WOULD NOT EVEN BE HAVING THESE CONVERSATIONS, BUT FOR THE INFRASTRUCTURE INVESTMENT BY THE CITY OF EDMOND.
SO I DON'T WANNA MINIMIZE THAT OR UNDERSTATE THAT AT ALL.
AFTER THAT HOTEL CONFERENCE CENTER DEVELOPMENT AGREEMENT IN 2012, IN JUNE OF 2013, ABOUT SEVEN OF US GOT ON A JET PLANE EARLY IN THE MORNING WITH STEVE MURDOCH AND LARRY STEVENS AND REPRESENTATIVES OF A DEVELOPMENT THAT WAS CALLED SHIELDS.
AND WE WENT TO KANSAS CITY AND WE WENT TO OMAHA, NEBRASKA THE SAME DAY AND CAME BACK.
AND AT THAT POINT, SHIELDS DIDN'T HAVE A SINGLE STORE SOUTH OF KANSAS CITY AND THEY WANTED TO COME HERE AND WE HAD A WONDERFUL DAY.
AND CHARLES LAMB, AS YOU KNOW, WAS A VISIONARY ABOUT HOW WE COULD CAUSE THIS TO HAPPEN BECAUSE HE KNEW WE HAVE TO HAVE A PARTNERSHIP AND WE HAVE TO INCENTIVIZE DEVELOPMENT BECAUSE EDMOND CAN'T JUST REST ON HIS LAURELS.
AND WE SPENT AN ENTIRE DAY, UH, AND WHEN WE GOT BACK, UNFORTUNATELY THERE JUST WASN'T THE POLITICAL DESIRE TO DO IT.
CHARLES WAS A WONDERFUL LEADER, BUT THEY COULD NOT PULL IT TOGETHER.
AND STEVE COMMONS WAS A WONDERFUL LEADER IN THE CITY MANAGER'S OFFICE, BUT THERE JUST WASN'T THE POLITICAL WILL TO CAUSE THAT TO HAPPEN.
BUT NONETHELESS, WE MOVED FORWARD TO THE HOTEL CONFERENCE CENTER AND THAT OPENED, AND THEN THERE WAS DISCUSSION ABOUT ENTERTAINMENT.
AND THEN I THINK IT WAS MARCH OF 2017,
[02:00:01]
WE ENTERED AN AGREEMENT FOR THE SHOWBIZ MOVIE THEATER.AND THERE WAS A PUBLIC PRIVATE PARTNERSHIP BETWEEN THE SAME TWO GROUPS, THE CITY OF EDMOND AND RODDY'S TEAM.
AND, UH, THE CITY CONTRIBUTED SALES TAX INCENTIVE REBATES AND RODDY CONTRIBUTED ABOUT $17 MILLION TO BUILD THE SHOWBIZ MOVIE THEATER.
THERE WAS JUST THE CONTINUATION OF WHAT WE'RE TRYING TO BRING TOGETHER, KNOWING THAT RETAIL WAS ALWAYS OUT THERE.
AND HERE'S WHAT THE RETAIL DEVELOPERS WOULD SAY TO US, AND THEY SAID IT TO US IN FIVE DIFFERENT BIG GROUPS.
THEY SAID, WE LOVE THE LOCATION BECAUSE OF THE TRAFFIC ON I 35, BUT NOBODY LIVES OUT HERE.
AND YOU CAN TELL ME IT'S THE CENTER OF EDMOND GEOGRAPHICALLY, AND THAT'S GREAT, BUT WHO'S GONNA BE HERE SHOPPING MONDAY THROUGH THURSDAY BECAUSE WE CAN GET FRIDAY, SATURDAY, SUNDAY, ALL DAY LONG FROM THE HIGHWAY.
AND IN THE MEANTIME, THE CITY OF EDMOND, THE RICH LEADERSHIP, HAS PLOTTED MAYBE A THOUSAND RESIDENTIAL LOTS EAST OF I 35.
AND NOW THAT IDEA OF A SCHOOL AT AIR DEPOT AND COVELL HAS NOT JUST BEEN A GREEN FIELD, BUT IT'S BECOMING A SCHOOL AT AIR DEPOT AND COVELL.
AND SO NOW THE TIME IS RIPE FOR THE RETAIL TO SAY, YEAH, WE'RE, WE'RE READY TO COME THERE BECAUSE WE BELIEVE WE HAVE THE BUSINESS MONDAY THROUGH THURSDAY, NOT JUST FRIDAY, SATURDAY AND SUNDAY.
AND AS WE SEE THAT, WE SAW IT IN THE MARKETPLACE ABOUT TWO MONTHS AGO, THREE MONTHS AGO, OKLAHOMA CITY DID THEIR LARGEST INCENTIVE IN THE HISTORY OF OKLAHOMA CITY FOR A SINGLE RETAILER, $8 MILLION, IRONICALLY FOR THAT SAME SHIELDS, ONE RETAILER, $8 MILLION.
CITY OF OKLAHOMA CITY HAD A PROBLEM, AS YOU MIGHT REMEMBER YEARS AGO WITH CABELA'S AND ALL OF THAT.
BUT THEY'RE BACK IN THE MARKET BECAUSE THEY KNOW THEY HAVE TO, TO INCENTIVIZE RETAILERS.
JUST IN THE PAPER LAST WEEK, THE CITY OF NORMAN, IN CONJUNCTION WITH A LOT OF PUBLIC ENTITIES, IS GETTING A $50 MILLION LOAN FROM THE COUNTY TO BUILD AN ENTERTAINMENT COMPLEX.
IT'S A GOVERNMENT FUNDED PROGRAM THAT GIVES THEM THE MONEY BACK.
AND SO MY HISTORY LESSON ENDS WITH THIS.
CHARLES LAMB SAID WE NEEDED TO BE PARTNERS IN 2007.
AND ALTHOUGH THE CITY WASN'T ABLE TO DO EVERYTHING THEY WANTED TO DO, AND OURS HAS BEEN UP AND DOWN AND SLOW, THOSE TWO PARTNERS HAVE REMAINED.
AND THERE'S THINGS THAT ARE HAPPENING OUT THERE.
THE PRIVATE SIDE HAS SPENT CLOSE TO $80 MILLION ALREADY OUT THERE, NOT COUNTING CARRY COSTS.
AND, AND THEY'RE GONNA SPEND ANOTHER A HUNDRED MILLION DOLLARS AS PART OF THIS RETAIL DEVELOPMENT IF WE CAN MAKE THIS HAPPEN.
AND THE IDEA ABOUT THE TARGETED RETAILERS MAKES PERFECT SENSE BECAUSE ONE OF THE PROJECTS WE LOOKED AT EARLY ON WAS THIS IDEA OF FUNDING THE DEVELOPMENT UPFRONT WITH BOND MONEY BASED ON A, A BELIEF THAT REVENUE IS GONNA COME IN.
WHERE HERE THE REVENUE HAS TO COME IN BECAUSE THE STORES HAVE TO BE OPEN, RIGHT? AND IF TWO OF THE RETAILERS DON'T OPEN AT ALL, THEN THE DEVELOPER'S RISK IS ALL ON HIM OR HER OR THEIR COMPANY OR THEIR FAMILY.
AND SO THERE'S PROTECTION IN GREAT WAYS THAT DIDN'T EXIST IN SOME OF THE PREVIOUS THINGS THAT WE LOOKED AT.
SHOWBIZ IS A GREAT EXAMPLE, RIGHT? IT'S A REBATE OF SALES TAX RECEIVED AND IT'S CAPPED HERE.
AND IF ANYBODY THINKS A STORE IS GONNA OPEN AND THEN NOT OPERATE, IT'S POSSIBLE.
BUT THIS IS NOT A GROCERY STORE DEVELOPMENT.
ONE GROCERY STORE IS 35,000 FEET.
THE ENTIRE DEVELOPMENT IS 250,000 SQUARE FEET OF RETAIL.
IT SHOWS $165 MILLION IN RETAIL SALES WHEN IT'S FULLY BUILT OUT.
AND I HEARD WHAT JENNIFER SAID, BUT JENNIFER DIDN'T SAY THAT OUR CONSTRUCTION MATERIALS ALONE IS OUR SALES TAX GENERATOR TO THE CITY OF $2.8 MILLION.
SO THERE IS REVENUE SOURCES, AND I WANT TO GIVE A COUPLE MORE PIECES OF INFORMATION AND THEN I PROMISE I'LL SIT DOWN IS UTILITIES.
OUR DEVELOPMENT ESTIMATES THAT ELECTRIC DRAW WILL BE A LITTLE OVER A MILLION DOLLARS A YEAR IN ELECTRIC FEES TO THESE DEVELOPERS, TO THESE TENANTS.
STORM WATER OR SANITARY SERVE BOTH ABOUT $300,000 EACH FOR THE DEVELOPMENT.
SO $1.6 MILLION IN AN OPERATING DEVELOPMENT AT A PIECE OF AREA RIGHT NOW THAT IS COMPLETELY GREEN.
THE NUMBERS I'M TALKING ABOUT DON'T COUNT SHOWBIZ IN THE HOTEL CONFERENCE CENTER.
SO 1.6 MILLION A YEAR IN UTILITY REVENUE, 3.75% OF $165 MILLION IN RETAIL SALES GOING FORWARD.
OBVIOUSLY IT'S AN INVESTMENT AND LIKE CHARLES SAID DECADES AGO, IT HAS TO BE A WIN FOR BOTH SIDES OR IT'S NOT A GOOD DEAL.
YOU KNOW, IF YOU GO FROM THE TECH KANSAS STATE LINE, IT'S 94 MILES TO COVE ROAD.
AND OTHER THAN SOME GAS STATIONS AND SOME FAST FOOD AT HIGHWAY 33, THERE'S NOT A SINGLE LOCATION ON I 35 WHERE THERE'S SIGNIFICANT RETAIL.
I MEAN, PICTURE IT, TOWAS OFF, PERRY'S OFF, STILL, WATER'S OFF, ENID'S OFF.
THIS IS OUR OPPORTUNITY TO CAPTURE PEOPLE THAT COME TO OUR COMMUNITY AND NOT JUST HAVE THEM BUY SOMETHING AND LEAVE, BUT HAVE 'EM COME AND DWELL AND STAY, STAY AT OUR HOTEL CONFERENCE CENTER, USE OUR SERVICES AND BUY THINGS AND STAY IN OUR COMMUNITY.
AND THIS OPPORTUNITY IS, IS SIGNIFICANT.
NOT BECAUSE IT HADN'T BEEN HERE IN THE PAST, BUT IT'S NEVER COME TOGETHER LIKE IT IS TODAY.
[02:05:01]
AND SO I'M HERE ON BEHALF OF RODDY AND YOU KNOW HIM WELL.HE'S BEEN HERE SINCE 2005 ON THIS PROJECT.
AND I TELL PEOPLE ALL THE TIME, IF IT WASN'T FOR RODDY BATES AND MIKE DILLARD AT THIS LOCATION, IT'D PROBABLY BE ON ITS THIRD OR FOURTH OWNER BY NOW BECAUSE NOBODY STAYS WHEN IT TAKES THIS LONG TO GET DEALS DONE.
AND SO WE'VE SEEN WHAT'S HAPPENED ON THE SOUTHWEST CORNER AND THERE'S MORE TO COME AND YOU'VE SEEN WHAT'S HAPPENED ON THE NORTHWEST CORNER AND THERE'S CERTAINLY MORE AVAILABLE THERE.
I MEAN THE NORTHEAST CORNER, BUT THE NORTHWEST IS WHERE IT'S AT.
AND SO WE'RE LOOKING FORWARD TO THE OPPORTUNITY TO ANSWER ANY QUESTIONS ABOUT OUR PARTNERSHIP.
WE BELIEVE IT'S A WIN-WIN FOR ALL OF US.
WE BELIEVE THERE'S A GREAT RETURN ON THE CITY.
AND UNFORTUNATELY OR FORTUNATELY, IT'S THE WAY THE MARKET IS WHEN IT COMES TO DEVELOPMENT IN OUR COMMUNITY AND BECAUSE OF THE WAY THE RETAILERS DEMANDED OF US.
SO WITH THAT, I'LL BE HAPPY TO ANSWER ANY QUESTIONS AND, AND HOPEFULLY NOT OVER TALK MORE THAN I ALREADY, CHARLES USED TO ALWAYS GIMME KIND OF A HEAD NOD WHEN I TALK TOO MUCH.
SO THAT WAS PROBABLY ABOUT FIVE MINUTES AGO.
MARK, YOU PROBABLY SHOULD HAVE DONE THAT BE BEFORE I TURN IT BACK OVER TO AJ, HAVE WE GOT ANY QUESTIONS FOR TODD? I'VE GOT A FEW, UH, UH, I THINK THE HOTEL IN THE PICTURE SHOW OPENED UP ABOUT EIGHT YEARS AGO.
IS THAT RIGHT? SAY, UH, 20 17TH OF DECEMBER WAS WHEN WE OPENED ONE OF, I THINK THE ONE RIGHT, RIGHT AROUND THOSE TIMES.
AND, UH, COVID CAME AND THINGS STOPPED.
UH, I'M TIRED OF DRIVING BY THERE AND LOOKING AT RED DIRT BLOWING EVERY DIRECTION.
UH, TALK TO ME ABOUT THE HOUSING THAT'S GONNA GO OUT THERE, IF YOU WOULD.
AND THEN MS. SPRINGER MENTIONED THAT FOUR OR FIVE YEARS FOR THIS TO PAY FOR ITSELF.
LET'S TALK ABOUT THAT A LITTLE BIT.
UH, I THINK I READ SOMEWHERE A HUNDRED MILLION DOLLARS IN PHASE CAPITAL INVESTMENT.
I WANT, WE CAN TALK ABOUT THAT AND, UH, THE INCENTIVES.
AND I THINK THIS PROBABLY BE A QUESTION FOR THE CITY MANAGER.
THE, THE INCENTIVES, THE 1.7 I BELIEVE IT IS, ISN'T THAT RIGHT? UH, 17 DIVIDED BY NINE.
SO 1.66 OR SOMETHING LIKE THAT, I BELIEVE.
HOW'S THAT? LET'S DO THIS ONE FIRST AND THEN WE'LL COME BACK.
UH, TALK ABOUT THE PROCESS OF THAT AND WHERE IT'S GOING.
DO YOU MEAN, UH, THE, THE AGREEMENT MECHANICS UHHUH
SO, UM, AS, UH, MR. MCINNIS, UH, CITED A SECOND AGO DURING HIS REMARKS, IT'S SET UP SO THAT EACH OF THE NINE LISTED TENANTS HAVE A TWO-TIERED, UH, PERFORMANCE REQUIREMENT.
UM, UH, A C OF O UH, THEY HAVE TO, OBVIOUSLY, LET'S BACK UP.
THEY HAVE TO GO, EACH RETAILER HAS TO GO TO THEIR RESPECTIVE CAPITAL COMMITTEE.
THEY'VE GOTTA GET APPROVAL, THEY'VE GOTTA GO THROUGH A SITE PLAN, THEY'VE GOTTA GO THROUGH A BUILDING PERMIT PROCESS WITH US.
THEN THEY'VE GOTTA GO BUILD IT.
THEY'VE GOTTA GO FURNISH IT, THEY'VE GOTTA GO STOCK IT.
THEN THEY GET TO A C OF O AND ULTIMATELY THE PART OF THE STANDARD, THE PERFORMANCE STANDARD FOR THAT C FOR THAT C OF O OR CERTIFICATE OF OCCUPANCY, IS THAT THEY HAVE TO HAVE A SALES TAX LICENSE AS WELL.
THEY'VE GOTTA BE OPEN FOR BUSINESS.
AND SO AT THAT POINT, THEY QUALIFY FOR 50% OF THE INCENTIVE OR WHO'S THEY? THE, THE PARTIC THE, EACH OF THE NINE NAMED RETAILERS WITH ONE CAVEAT, AND I'LL COME BACK TO THAT IN A SECOND.
AND THEN THE SECOND TIER OF THE MILESTONE IS AFTER 180 DAYS OF CONTINUOUS OPERATION, IF THEY HAVE, IF THEY'RE OPEN, IF THEY'RE, IF THEY'RE CONDUCTING BUSINESS, ET ET CETERA, THEY WOULD BE IN LINE FOR THE SECOND MILESTONE OR THE SECOND PART OF THE 1.888, UH, PER TENANT.
THE, THE CAVEAT AND IT IS SIGNIFICANT IS THAT, UM, THE, THE, THE TENANTS THAT WERE PROBABLY THE MOST IN DEMAND FROM A SALES STANDPOINT ARE DICK'S AND WHOLE FOODS, DICK'S SPORTING GOODS, AND WHOLE FOODS.
AND IT'S A LITTLE BIT UNUSUAL THAT WE CAN BE AT A POINT IN A PROJECT LIKE THIS WHERE WE CAN TALK ABOUT SO MANY TENANTS.
I MEAN IT, WHAT WHAT WOULD BE NORMAL IS THAT WE'D HAVE A MAYBE THE BIG BOX OR THE ANCHOR ONE OR TWO ANCHORS, BUT NOT BEING ABLE TO LIST ALL THE OTHER ONES.
BUT THE WAY THE AGREEMENT IS SET UP IS THAT THE DEVELOPER HAS TO PERFORM, UH, ON BOTH DICK'S AND, UH, WHOLE FOODS BECAUSE THEY'RE LISTED AS AND DEFINED AS PRIORITY ANCHOR TENANTS.
THEY HAVE TO PERFORM ON BOTH OF THOSE BEFORE THEY'RE ELIGIBLE TO RECEIVE THE INCENTIVE FOR ANY
[02:10:01]
OF THE OTHER SEVEN NAMED TENANTS.WELL, YOU JUST ABOUT GOT THERE.
SO THE, IN THE INCENTIVE DOLLARS, WHERE ARE THEY GOING? WHO ARE THEY GOING TO? WELL, DO YOU WANT ME TO, I MEAN THEY'RE, THEY'RE, THEY'RE GOING TO, I THINK, UH, IF I COULD, HE'S ASKING THE DEVELOPER WILL RECEIVE THOSE DOLLARS.
BECAUSE, AND I DON'T KNOW THE GUY, BUT WITH ALL DUE RESPECT, I DON'T THINK JEFF BEZOS NEEDS A PENNY OF INCENTIVES OR A PENNY OF EDMOND DOLLARS.
SO IF IT'S THE LOCAL DEVELOPER, THAT'S UNDERSTANDABLE.
YES, IT GOES ULTIMATELY TO THE DEVELOPER.
SO CAN I GIVE A LITTLE MORE COLOR TO THAT COUNCILMAN BEARER IF I COULD? SURE.
UH, THE, UH, CAN PULL BACK THE CURTAIN A LITTLE BIT, UH, AS MUCH AS ANYBODY WANTS ME TO.
BUT, UH, WHOLE FOODS IS IN SUCH DEMAND THAT THEY'RE NOT WILLING TO COME IN AND PAY MARKET RATE FOR ANYTHING, RIGHT? YEAH.
THEY'RE THE TARGET OF 15 YEARS AGO, THEY'RE THE WHATEVER OF 20 YEARS AGO.
AND SO WHAT HAPPENS IS THEY SAY, YEAH, WE'LL COME TO YOUR SPOT, BUT WELL, I'LL JUST TELL YOU THIS 'CAUSE I REPRESENT 'EM WITH THEM.
THERE WOULDN'T BE A WHOLE FOODS AT CLASS AND CURVE IF AUBURN MCCLENDON DID BUY THE LAND, BUILD THE BUILDING AND GIVE IT TO 'EM.
AND ALL THEY HAD TO DO IS BRING IN THEIR INVENTORY AND OPEN UP.
NOW, THANKFULLY
UH, BUT THERE IS AN IDEA THAT THEY HAVE SUCH STRONG STRENGTH IN THE MARKETPLACE THAT THEY SAY, WE'RE NOT COMING AT A NORMAL MARKET RATE.
YOU WANT THIS, WE'RE NOT DOING THAT.
AND SO WHAT HAPPENS IN OUR EXAMPLE, AND IT IS A, IF THE WORD SYMBIOTIC OR WHATEVER RELATIONSHIP, OUR RELATIONSHIP WITH WHOLE FOODS IS THIS, IF WE DON'T HAVE AN INCENTIVE FROM THE CITY, WE CAN TERMINATE OUR RELATIONSHIP WITH THEM.
BUT THE BAD NEWS IS ALL OF OUR OTHER TENANTS HAVE CO-TENANCY REQUIREMENTS.
THAT WHOLE FOODS NEEDS TO BE THERE OR PICK THE, PICK THE PROPER NOUN THAT AJ SAID.
THEY'RE LIKE, WE DON'T HAVE TO COME, WE'RE NOT COMING.
AND SO THEY KNOW THAT, THEY KNOW THAT STRENGTH.
AND IT'S LIKE YOU'RE LOSS LEADER IN THE MARKET, YOU KNOW? MM-HMM.
YOU'RE LIKE, WELL, I COULD, I COULD SELL YOU MILK.
IT COSTS, I'M GONNA MAKE MONEY ON CANDY BARS OR WHATEVER.
THERE'S NOT ENOUGH CANDY BARS ON A PROJECT TO MAKE UP FOR THAT.
AND SO FOR THE DEVELOPER TO BE ABLE TO DO IT, THEY CAN'T DO IT WITHOUT SOME HELP.
IF THEY CAN'T DO IT WITHOUT SOME HELP, THEN IT'S NOT A WHOLE FOODS, IT'S AN ON QUEUE AND ALL THE OTHER THINGS.
IT DOESN'T SEEM TO BE AT THE HIGHEST OF OUR LIST RIGHT NOW.
SO THAT'S THE MACHINATIONS UNDERSTAND FROM OUR STANDPOINT, UNDERSTAND, UH, SO SORRY FOR BELABORING THAT POINT, BUT ON THE MULTIFAMILY, AND THIS I THINK IS A GREAT EXAMPLE OF ALL THE OTHER DEVELOPMENT ACTIVITY AS A RESULT OF SOMETHING LIKE THIS, THERE'S A $150 MILLION, 498 MULTIFAMILY UNIT DEVELOPER THAT WANTS TO BE THERE AND THEY WANT TO BE THERE BECAUSE THERE'S RETAIL THERE.
SO THAT WILL HAPPEN IF WE GET THIS, LIKEWISE THE RETAILERS LIKE WE WANT MORE PEOPLE.
AND SO THE 102 TOWNHOUSES THAT HAVE JUST BEEN COMPLETED OUT THERE ARE EXPECTED TO BE THERE BECAUSE THE RETAILERS EXPECTING THAT.
AND THE CORRESPONDING BENEFIT TO THE CITY IN UTILITY DRAW AND SALES TAX SHOPPERS, I MEAN, FIGURE A 600 UNIT APARTMENT COMPLEX IS 1200 PEOPLE.
UH, AND YOU ALL OF A SUDDEN POPULATE THAT INTERSECTION.
WHOLE FOODS SAYS OVER HALF THEIR BUSINESS BETWEEN 11:30 AM AND 1:30 PM I'VE NEVER GONE TO COVE AND I 35 TO BUY LUNCH.
I PROBABLY WILL SOMEDAY BECAUSE MOST OF THE PEOPLE COME IN ON THEIR CASH.
I MEAN THEIR CARRY LUNCH PROGRAM.
SO THEY WANT PEOPLE OUT THERE AND PEOPLE WANNA BE OUT THERE.
THIS WAS THE SAME STORY WE TOLD AT COVAL AND KELLY 20 YEARS AGO IN 2007 WHEN WE DID THE LOWE'S THERE.
AND WE COULDN'T HAVE ANY RESTAURANTS AT COVAL AND KELLY 'CAUSE THERE'S NO OFFICES.
BUT THEN ALL OF A SUDDEN AN ORTHODONTIST OPENS AND THEN A OPTOMETRISTS OPENS AND A VETERINARIAN OPENS.
OH, WE GOT PEOPLE THAT WANT TO EAT LUNCH JUST 'CAUSE THEY'RE WORKING UP HERE.
SO I DUNNO IF THAT ANSWERS YOUR QUESTION.
COUNCILMAN MOORE ABOUT THE MULTIFAMILY THAT'S, THAT, THAT, THAT GOT MOST OF IT, THE FOUR FIVE YEAR DEAL.
SPECIFICALLY, ARE YOU ASKING WITH THE BREAK EVEN POINT FOR THE 17 MILLION? SO WHAT I DID, JUST TO MAKE THIS MODEL SIMPLE FOR YOU GUYS, IS WITH THOSE NINE TENANTS, THEY GAVE ME THEIR ANNUAL SALES NUMBERS.
SO I CALCULATED YEAR ONE WAS ALL NINE OF THOSE WITH THEIR SALES GOALS.
UM, SO WHEN YOU GOT TO YEAR AT THE END OF YEAR FOUR, IT'D BE 16.66 MILLION.
AT THE END OF YEAR FIVE, IT'D BE 21.043 MILLION.
SAY THAT LAST NUMBER 21, 21 0.043 MILLION.
AND THAT'S JUST CONSIDERING THOSE NINE, THE SALES TAX OR THE SALES GOALS THAT THEY GAVE US FOR SOLID YEARS, ALL NINE OPEN AN ENTIRE YEAR THROUGH YEAR ONE TIMES AGGREGATE.
[02:15:01]
ARGUMENT THAT AT THE 17 AND THE FOUR AND A HALF FOUR, IT'S 4.533 OR SOMETHING.IF YOU DIVIDE IT OUT, THAT'S THE PAYBACK THAT INCLUDES, THAT'S, THAT'S BASED ON THE 0.375 THAT, THAT THE CITY GETS, RIGHT? YEAH.
WITHIN THAT, THE 2% FOR GENERAL WITHIN THAT, YES, THERE'S PARTS THAT'S DEDICATED PARKS, POLICE, FIRE.
BUT, BUT THAT'S NOT ALL BAD IN THAT, JUST AS WE WERE TALKING IN THE BUDGET LAST WHILE AGO, WHEN WE SUPPRESS REVENUES, IT HAS AN IMPACT ON PUBLIC SAFETY AND ON INFRASTRUCTURE.
SO IT'S NOT NECESSARILY A BAD THING.
I MEAN, SORRY, CHIEFS, I DON'T WANT EVERYTHING TO BE BLED OFF THAT WAY, BUT IT, BUT IT'S OKAY FOR A PIECE TO GO THAT DIRECTION.
NOW WE CAN DOUBLE THAT OR TWO AND A HALF TIMES THAT EXTRACT OUT THE POLICE AND FIRE AND IT'S WITHIN A 10 YEAR PAYBACK IF YOU DON'T INCLUDE THE PART THAT GOES TO POLICE AND FIRE.
SO THAT'S, AND AND THIS WOULD BE NEWLY GENERATED, UH, SALES TAX ABOVE AND BEYOND WHAT EDMOND'S BEEN ABLE TO TO DO WITH THIS NEW PROJECT.
ALL OF YOUR NUMBERS, IF I HEARD YOU RIGHT, ALL OF YOUR NUMBERS ARE JUST BASED ON THOSE NINE TENANTS, CORRECT? CORRECT.
EXCEPT FOR THE ECONOMIC IMPACT THAT TAKES INTO ACCOUNT ALL THREE OF THOSE.
BUT THE SALES TAX NUMBERS, UH, THE LOCAL SALES TAX NUMBERS IS JUST THOSE NINE.
SO IS AS YOU, AS YOU CONTINUE TO DEVELOP IT, THEN YOU'RE TALKING ABOUT AN ADDITIONAL 12 TO 15, THE WAY I UNDERSTOOD IT, PAD SITES MM-HMM
NOT TO MENTION THE FACT THAT BASED ON WHAT WE'VE BEEN TALKING ABOUT, THEN THAT BECOMES THAT CATALYST FOR GROWTH FOR THE CITY AS A WHOLE.
WHEN WE TALK ABOUT THE I 35 CORRIDOR, AND EVEN MORE SPECIFIC, WHAT WE VOTED ON DURING OUR LAST COUNCIL MEETING, WHICH IS THE SOUTHEAST CORNER OF THAT INTERSECTION WHERE WE'RE TALKING ABOUT MORE RETAIL AND A HOTEL.
AND WE'VE, WE'VE DONE SOME OTHER MODELING, BUT THIS WAS THE MOST STRAIGHTFORWARD TO BE ABLE TO MAKE A DECISION OFF THIS INCENTIVE AGREEMENT.
WE ALWAYS TALK ABOUT IT, IT'S ABOUT THE MATH.
SO THANK YOU FOR HELPING US WITH THAT.
UM, ONE THING, ONE COMMENT I SAW, UH, PROBABLY RECENTLY ALL OF YOU SAW, UM, I GUESS IT FURTHERS MR. MCKENNA'S POINT ABOUT INCENTIVES.
I MEAN, I, I'M LIKE A LOT OF YOU, I WISH THERE WAS NO SUCH THING, BUT GUESS WHAT THERE IS.
SO FIGURE IT OUT OR GET LAPPED TIME AND TIME AGAIN.
I, I THOUGHT IT WAS INTERESTING.
YOU PROBABLY RECENTLY SAW THE CITY OF TULSA.
IN FACT, THEIR CITY COUNCIL CAME OUT AND, AND NOTED THEY'RE GIVING UPFRONT $2.5 MILLION TO ATTRACT IKEA.
AND IKEA WILL COME IN AND IT'LL PRODUCE, I MEAN, IT'S GONNA BE ABOUT A TWO AND A HALF, THREE YEAR TURNAROUND, PROBABLY PAYBACK.
BUT ONE OF THE THINGS THAT COUNCIL SAID THAT I THOUGHT WAS REALLY INSTRUCTIVE SAID, ECONOMIC DEVELOPMENT IS A CONTACT SPORT.
WE ARE COMPETING WITH CITIES THAT ARE OUR SIZE OR CITIES THAT ARE LARGER FOR GREAT AMENITIES.
IT'S IMPORTANT THAT WHEN YOU'RE COMPETING, YOU COME TO THE TABLE WITH A DEAL THAT MAKES SENSE FOR RESIDENTS, BUT IT ALSO ENCOURAGES BUSINESS OWNERS WHO WANT TO MAKE A CAPITAL INVESTMENT.
AND, AND I THINK WE GOTTA GET BETTER AT THAT.
WE GOTTA GET BETTER AT WHAT THE CAPEX, WHAT'S THE CAPEX, WHAT'S THE HURDLE RATE? WHAT THE, WHAT'S THE DEBT TO INCOME? DOES IT MAKE SENSE FOR THE DEVELOPER AS WE LOOK FORWARD TO TRYING TO ATTRACT MORE CAPITAL, TRY TO INCREASE, INCREASE THAT.
AND FINALLY, JUST, I, I KNOW SOME OF US ARE BIG ON ANECDOTAL THINGS.
I MEAN, SOME HAVE GONE AROUND AND SAID, HEY, YOU FOR THIS, ARE YOU FOR THIS? HOW MANY PEOPLE WANT THIS THING? PRESTON AND I WERE AT PAVING THE WAY THE OTHER NIGHT, AND A AND AN OLDER COUPLE CAME UP TO ME AND SAID, COUNCILMAN, CAN I ASK YOU A QUESTION? HE SAID, ABSOLUTELY.
I MAY NOT HAVE AN ANSWER, BUT PROBABLY COULD FIND ONE FOR YOU.
WHAT'S YOUR QUESTION? AND THEY SAID, WELL, WE MOVED HERE, RETIRED FROM SOUTHWEST OKLAHOMA, WE MOVED TO EDMOND.
AND WE PICKED A SPOT IN WARD TWO ON COVE ROAD AND SAID, THE REASON WE PICKED THAT SPOT WAS BECAUSE THIS GREAT INCREDIBLE RETAIL CENTER WAS COMING TO TOWN.
WE SHOP AT AT, AT THE GROCERY STORE OUT THERE NAMED CREST.
AND WE WILL CONTINUE TO DO SO, BUT CAN YOU TELL ME WHEN'S THAT SHOPPING CENTER COMING? AND SO
[02:20:01]
I THINK THERE'S MORE PEOPLE LIKE THAT KIND OF LAY UNDER A RUG AND WAIT FOR, WAIT FOR US AND LOOK FOR SOMETHING TO HAPPEN.BUT I, I THOUGHT THAT WAS KIND OF INTERESTING AND ENCOURAGING THAT THERE ARE PEOPLE THAT THEIR SITES ARE THERE AND THEY EVEN LIVE IN CERTAIN PLACES BECAUSE OF THAT POTENTIAL.
AND, AND I THINK IT IS IT, HEATHER CALLED IT A CATALYST USE CATALYTIC, BUT I'LL JUST CALL IT A CATALYST.
AND, AND, AND WE'VE IDENTIFIED EEDA IN THE CITY.
WE WANT, AS MARK SAID, WE WANT I 35 TO BE THAT WHERE WE CAPTURE PEOPLE COMING IN, NOT LITERALLY, BUT JUST TO SPEND MONEY ON I 35 AND RETAIL, RETAIL.
AND THERE THERE'S OTHER, OTHER OPPORTUNITIES AND THINGS CLOSE BY THERE ON SOONER ROAD.
AND, AND THIS IS A, A CATALYST IS SOMETHING THAT KICKS THINGS OFF.
AND I COULD SEE THIS BEING THAT IF IT GETS FULLY BUILT.
SO, UM, IT IS TRULY A, A GENERATIONAL OPPORTUNITY.
I I, I DON'T HAVE NUMBERS, BUT I, I THINK IT WOULD, EVERY OTHER CORNER OR RETAIL CENTER WILL PALE IN THE POTENTIAL THAT THIS HAS TO PRODUCE RETAIL SALES AND THEREFORE RETAIL THE SALES TAX DOLLARS TO THE CITY.
OTHER COMMENTS THIS DIRECTION? I THINK I'D ADD, YOU KNOW, AS I'M SITTING HERE THINKING ABOUT THE ECONOMIC IMPACT THAT WE CAN ACCOUNT FOR THROUGH, UM, PROJECTIONS BASED OFF SALES.
AND, UM, I ALSO THINK ABOUT THE IMPACT ON OUR SCHOOLS AND, UH, THE INCREASE IN PROPERTY TAX AND IN A TIME WHEN PUBLIC SCHOOLS REALLY NEED THAT FUNDING.
AND SO I'M EXCITED ABOUT THE WAYS THAT THIS, UH, PROJECT WILL BRING INCREASED QUALITY OF LIFE TO CITIZENS.
I WANNA KEEP MORE PEOPLE IN EDMOND ALL DAY LONG.
UM, SO I'M JUST, YEAH, I FEEL POSITIVE.
I DON'T HAVE QUESTIONS AT THIS TIME, BUT THANK YOU ALL.
WELL, I'M GLAD WE'RE TALKING ABOUT THIS.
THIS IS, UH, THIS TIME AND A PLACE TO DO IT.
I, UH, I, YOU KNOW, WHEN THIS FIRST CAME TO MY ATTENTION, I WAS MAYBE A LITTLE RELUCTANT TO GO THE INCENTIVES ROUTE.
I, UH, HAD SOME RESERVATIONS ABOUT THAT.
BUT I'VE WATCHED OKLAHOMA CITY PICK OUR POCKET FOR THE LAST SEVERAL YEARS SOUTH OF MEMORIAL, GETTING READY TO GO IN ON THE WEST SIDE OF THE CITY LIMITS.
UH, SO THE TIMES THEY ARE CHANGING ON HOW THAT WORKS, I DO WANNA SAY TO THE DEVELOPER, UH, IF THIS IS APPROVED AND IF THESE RETAILERS COME ABOUT, I, UH, GET THE WORK OUT THERE, GET THIS THING DONE AND LET'S MOVE ON, AND THEN WE'LL FIGURE OUT WHAT'S NEXT.
BUT, UH, IT'S, IT'S TIME TO ACT AND TIME TO DO SOMETHING.
AND, AND, AND TODAY WAS HELPFUL READING.
THIS WAS HELPFUL HEARING FROM EEDA, UH, HEATHER AND, AND JENNIFER.
UH, AND SO LET'S SEE HOW THIS WORKS OUT IN TWO WEEKS.
UH, I'M CONFIDENT IT'S THE PROPER THING TO DO AND THE RIGHT THING TO DO TO GET SOME TAX DOLLARS IN HERE TO EDMOND.
I, UH, PHIL, I, THAT SAME COUPLE ASKED ME A QUESTION AND I SAID, OH, WHY DON'T YOU ASK PHIL FRAME? I SAID, YOU'LL GET, YOU'LL GET A MORE THOROUGH ANSWER OUTTA HIM.
UH, SO I'LL, I'LL I AGREE WITH WHAT YOU TOLD HIM.
AND, AND I'LL, I'LL JUST ADD, I BET YOU IF I HAD TO SIT HERE IN THIS ROOM, THERE'S NOBODY MORE THAN THOSE TWO GUYS SITTING THERE THAT WANT TO SEE THIS THING GET DONE.
IT'S BEEN A LONG TIME COMING IN THIS BROAD PUBLIC SUPPORT.
I DON'T HAVE ANYTHING ELSE DONE.
UM, I THINK THERE'S A COUPLE OF ISSUES THAT I THINK ONE OF THEM NEEDS TO BE ADDRESSED.
I THINK BEFORE WE CAN MOVE FORWARD ON THIS AGREEMENT.
UM, IN ONE SECTION WE TALK ABOUT ENCUMBRANCES AND LIENS ON THE PROPERTY.
AND IT'S MY UNDERSTANDING THAT THERE MAY BE A MORTGAGE ON IT THAT NEED, THAT LANGUAGE I THINK NEEDS TO BE CLEANED UP IF WE'RE GONNA DO THIS THE RIGHT WAY.
UM, I DON'T KNOW HOW YOU CLEAN THAT UP.
THAT'S A CONVERSATION AJ, I THINK YOU HAVE WITH OUR LEGAL DEPARTMENT AND, AND RODDY AND MIKE'S TEAM, UM, ON HOW WE WE FIX THAT LANGUAGE.
THE OTHER THING THAT I WOULD LIKE
[02:25:01]
TO SEE, BECAUSE I DO VIEW THIS AS THIS, IS THIS IS WHAT OUR ENTIRE ECONOMIC DEVELOPMENT PLAN AS A CITY, I THINK IS DEPENDENT ON.BECAUSE SO MANY RETAILERS, SO MANY RESTAURANTS ARE WATCHING US TO SEE WHAT WE DO.
UM, WE'VE MADE IT PRETTY CLEAR THAT WE'RE WORKING ON PROCESSES INTERNALLY, UM, WHICH MEANS WE'VE GOTTA HAVE PEOPLE IN THE OFFICE, THEY'VE GOTTA BE ABLE TO TALK TO SOMEONE ON CITY STAFF AS WE MOVE FORWARD.
BUT MORE IMPORTANTLY TO THIS EXACT THING IS WE'RE TALKING ABOUT TAKING 17 MILLION FROM OUR RESERVES TO MAKE THIS ONE HAPPEN.
AND IF WE DON'T DO SOMETHING TO CHANGE THE MODEL, IT BECOMES A ONE AND DONE.
UNLESS EVERYTHING IS A TIFF AND WE ANGUISH OVER HOW WE MAKE A TIFF WORK EVERY SINGLE TIME WE CREATE A TIFF DISTRICT, I WOULD LIKE TO SEE IF THERE'S NOT A WAY, AND I DON'T THINK IT HAS TO BE DONE BEFORE THIS AGREEMENT IS APPROVED, BUT, AND WE'VE GOT TIME, OBVIOUSLY, BECAUSE YOU'VE GOTTA GO THROUGH THE PLANNING PROCESS, YOU GOTTA GO THROUGH THE CONSTRUCTION PROCESS.
BUT I WOULD LOVE TO SEE IF THERE ISN'T A WAY, HOWEVER WE DO IT, TO BE ABLE TO CARVE OFF SOME OF THE REVENUE THAT WE GENERATE AS A CITY MOVING FORWARD TO POUR THAT 17 MILLION BACK INTO AN ECONOMIC DEVELOPMENT FUND SO THAT WE CAN DO MORE CONCEPTS LIKE THIS.
BECAUSE THIS IS OBVIOUSLY A MUCH MORE PALATABLE CONCEPT THAN WHAT WAS LAST APPROVED OUT THERE.
I MEAN, WE'RE TALKING THE, THE, THE, THE ASK BEFORE THAT WAS, I THINK IN PLAY THAT NEVER HAPPENED WAS LIKE A $40 MILLION DEAL.
AND NOW WE'RE SITTING HERE SAYING, LET'S GET THIS THING DONE FOR 17 MILLION AND START SOMETHING.
AND SO I DON'T WANNA LOSE THAT ABILITY.
AND I, I KNOW THIS IS, THIS IS NOT GONNA BE EASY TO FIGURE IT OUT, BUT IF THERE'S A WAY THAT WE CAN FIGURE IT OUT, LET'S DO IT.
BECAUSE WE'VE GOTTA GET IN THE GAME OR WE'RE NOT GONNA BE ABLE TO PAY FOR POLICE AND FIRE.
WE'RE NOT GONNA BE ABLE TO PAY FOR WHAT WE DO AS A CITY.
THE INFRASTRUCTURE IS GONNA CRUMBLE.
WE'VE GOTTA TURN THE CORNER AND GENERATE REVENUE.
AND SO I THINK THIS IS THE RIGHT THING, RIGHT TIME AND LET'S MAKE IT HAPPEN.
UM, THE REASON WHY WE'RE HERE TALKING ABOUT IT TODAY IS BECAUSE WE NEEDED TO GET ALL THIS OUT THERE SO THAT WE COULD HEAR IT AS A COUNCIL SO THAT WE HAVE ALL OUR QUESTIONS ANSWERED BEFORE THIS SHOWS UP ON, ON A CITY COUNCIL AGENDA.
AND MY ASSUMPTION IS WE'RE GONNA BE THERE IN TWO WEEKS AND WE CAN GET THIS THING DONE.
SO I, I JUST WANT TO ADD ONE THING TO YOUR COMMENT MARK.
I, I DON'T KNOW, BUT I DON'T WANT, IF THESE ARE TWO SEPARATE AGREEMENTS, TWO SEPARATE THINGS.
I DON'T WANT TO ENTANGLE THE CONTRACT LANGUAGE WITH, WITH WHAT'S ALREADY GONE ON, WHAT'S ALREADY HAPPENED WITH THE MOVIE THEATER IN THE HOTEL.
I THINK CITY MANAGERS HAS, HAS ADDRESSED THIS WITH DEVELOPERS AND WILL CONTINUE TO DO SO.
AND I THINK THAT WOULD BE, PROBABLY COULDN'T GET IT DONE, BUT IT WOULD BE A MISTAKE TO ATTEMPT TO DO THAT AND, AND SNAFU THE WHOLE, THE WHOLE DEAL.
BUT I DO THINK IT TO BE ADDRESSED IS, IS GREAT, BUT NOT WITHIN THIS CONTRACT.
AND THAT'S NO DIFFERENT THAN THE OTHER ISSUE THAT I THINK HAS BEEN LINGERING OUT THERE WITH THE ISSUE OVER, OVER PROPERTY TAXES AND THE, THE HOTEL CONFERENCE CENTER.
UM, IT'S MY UNDERSTANDING IT'S TWO DIFFERENT ENTITIES, EVEN THOUGH SOME OF THE SAME PLAYERS ARE INVOLVED AND WE'VE BEEN GIVEN SOME INSUR ASSURANCES, IT'S MY UNDERSTANDING THAT WE'RE WORKING TOWARDS A SOLUTION THERE.
I HAVE DIRECTLY SPOKEN TO THE DEVELOPER AND SETTING ASIDE FOR THE MOMENT, THE FACT THAT IT IS TWO DIFFERENT ENTITIES, HE HAS ASSURED ME AND I BELIEVE, AND WE'VE HAD, UH, SOME GOOD CONVERSATION ABOUT WORKING IN GOOD FAITH OVER THE COURSE OF THE NEXT YEAR.
I MEAN, AS WE SIT HERE TODAY, WE'D PROBABLY BE ABOUT A YEAR AWAY FROM HAVING TO MAKE ANY PAYMENT.
AND, UH, SO WE'LL WORK TOGETHER IN GOOD FAITH TO TRY AND GET THAT SITUATION RESOLVED.
AND I'M, I'M HOPEFUL THAT WE CAN.
ALRIGHT, ANY OTHER COMMENTS? THANKS FOR GOOD.
THANK, I THINK THIS HAS BEEN A PRETTY PRODUCTIVE DAY.
UM, WE RAN A LITTLE BIT LONG, BUT HEY, YEAH, I THINK IT WAS WORTH IT.
SO, UH, MARK, CAN I MAKE ONE MORE SUGGESTION? YEAH, BUT WE'RE GONNA TAKE YOUR MICROPHONE AWAY IF YOU'RE NOT CAREFUL.
LET, LET'S, LET'S MEASURE YOUR TIME AND MIND
I THINK THIS PROJECT NEEDED THIS
[02:30:01]
AND I'M GREAT, BUT I THINK WE NEED FURTHER DISCUSSION, WHETHER IT BE AN EXECUTIVE SESSION OR WHETHER IT BE IN A WORKSHOP.IS THIS THE METHODOLOGY THAT'S CORRECT FOR EACH AND EVERY INCENTIVIZED DEVELOPMENT PROJECT? THAT'S A GOOD QUESTIONS, GOOD QUESTION.
UNLESS ANYONE ELSE HAS ANYTHING TO ADD, I WOULD ENTERTAIN A MOTION TO ADJOURN.
MAYOR, I HAVE A MOTION TO SECOND CAST YOUR VOTE.