August 21, 2026

Machine-generated transcript — may contain errors.

Good afternoon, everyone. I think we'll get started with our budget discussion this afternoon. It's August 21st. If the city clerk could call the roll.

Council Member Patel. Council Member here. I'm sorry. Council Member Buse.

Council Member Gary Feder. Here. Council Member Jeffery Yorg. Council Member Waldman.

Here. Council Mayor Betsy Meyland-Smith. Here. Mayor McAndrew.

Here. Thank you. Council Member Betsy Meyland-Smith, if you could... I move that the council hold a closed meeting with a closed vote and record as authorized by Section 610.0211, 2 and 3 revised statutes of Missouri relating to legal issues, real estate and or personnel negotiation of a contract pursuant to Section 610.0112 RSMO and or proprietary information pursuant to section 610.0 2115 and or information related to public safety and security measures pursuant to Section 610.021, 18 and 19 RSMO.

Second. Council Member Patel? Aye. Council Member Pater?

Aye. Council member Waldman? Aye. Councilmember Betsy Meyland-Smith?

Aye. Mayor McAndrew? Aye. Thank you.

All right, we are back and we'll begin our fiscal year 2027 budget work session. All right. Thank you, Mayor. I'm going to try to get this out of the way.

Okay. So I do want to start by thanking Karen Dilber, our Director of Finance, Caleb Pakanowski, our Assistant Director of Finance, the entire Finance Department, and also our executive team for their work putting together this annual budget. It's a long process. You know, we share that calendar earlier in the year with the Council, and we've really been working on this since the spring.

And of course, the information that we... from the annual retreat was also very helpful in this particular process. So let's start walking through here. Let me know if you have questions at any time.

We're going to follow the same format we have the last few years. It's been effective in these conversations, I think, and generating questions and really an understanding of the annual budget. So we always start with this slide, which is kind of the history of general fund operational activity. And this is a comparison of our annual revenues and our annual expenditures over time.

You remember there's a dash line that runs through this, and that dash line is our revenue without the operational transfer that used to exist. So again, for those who might have forgot or are not familiar, we used to transfer about a half a million dollars from the capital fund to the general fund every year to support operational activity. We ceased that activity last year when we started collecting the fire sales tax. So you'll see that the dash line is now on the same level as the green revenue line.

But we always like to show it with and without that transfer. So you could get a sense of historically our true operation or our true, which is the dash line, the true operational receipts that you get in the general fund versus that blue line, which with which is expenditures. The big drop that you see here, that's when the city made the decision to have residents pay for trash. So we took that expense off off.

of our side of things had that been added back in this line would be lifted up and it's really just a straight line. And you can see how expenditures, and we talk about this all the time have been going up five to 6% a year for some time now in revenue is, is lagging that pace. And so the end result, and you know, we've talked about this coming is in fiscal year 26, those lines really hit each other, start to cross. And then in fiscal year 27 is we'll talk about for the next hour and a half or so is the fact that we are now in a deficit spend situation.

So our expenditures will be exceeding our revenue with or without the tornado-related expenses. And we're actually going to show that both ways, which I think is pretty helpful. So the sources of revenue are largely unchanged in fiscal year 27. This pie doesn't change much over time.

These percentages might fluctuate some, but really this is how it's looked for some time, which is a split of property tax at 25% of annual revenue, utilities at 17%, sales tax at 22%, license permits and fees, that includes all of the building permits, which are the largest portion of this, at 11%. Parking revenue at 6%, parks and rec at 3%. And when we talk about parks and recreation within the general fund, we're talking about those activities that are taking place at Shaw Park Aquatic Center, at the tennis center, within Shaw Park, the recreation leagues. This does not include the Center of Clayton.

That's a totally separate budget, and the money that we put towards the Center of Claydon every year is actually paid out of the capital fund. So this general fund number you see right here, that is solely recreational activity outside of the Center of Clayson. Fines, which is municipal court, traffic court, housing court, all of that, that's about 2% of our annual revenue, so well below the state of Missouri cap. intergovernmental and grants.

This is money we receive from the federal government, state government for some activities. But most of what you see here in Clayton on the intergovernmental side are from those shared services. So we have a battalion chief that runs all the training for the central core training division. So the money we receive from those other cities, we just approved that contract with Webster Groves.

That's all booked as intergovernmental revenue IT services. So the money we received from Brentwood and Maplewood and Richmond Heights, those are all booked as intergovernmental. The big one this year is the fire authority. So we're the ones that put out the RFP.

We're the ones that will sign the contract ultimately for the consultant, but we're also reimbursed from those other partner cities. So intergovernmental now makes up 9% of our overall budget. And again, most of that's coming through partnerships that we have with other municipalities. And overall, it helps keep our cost down, which is nice.

Interest income is 4%. So this has been slipping a little. We had kind of peak interest rates three years ago. So that was the peak of our interest income.

We did have laddered CDs and we still do. So we kind of know what our cash flow is going to be like over this next year and the interest we're going to get off of that. So still stronger than certainly what we saw back during the pandemic when we were getting two-tenths of a percent or whatever it was, but interest income still at 4% of overall revenue and kind of holding steady there. Miscellaneous, 1%.

Those are just some random capital items and other things that we have within the budget. So expenditure categories, we break this into three very, very general buckets every year. And so we have personnel expenses, which is salaries, overtime, social security, Medicare benefits, everything that relates with personnel and those expenditures that hit payroll basically. are grouped as personnel.

We have contractual services. So these are all the utility bills we pay. It's all of the software and licensing that we have. Our dispatch service, that's about $600,000 a year now through that ECDC partnership.

That bill shows up here. Lifeguard services, all of our insurance, our legal services, training, mowing for Y-Down and other areas, and then professional services. So contracts are a really big part of our budget. And then commodities, a very small portion.

We'll show the breakdown in a minute. That's uniforms, supplies, fuel, salt, and other items that we consume. So lumber, screws, you know, just general office stuff, all of that falls into that bucket. When we look at those broad categories here, we're showing this two ways.

So again, expenditures by category on the left, that includes the tornado numbers, and on the right, it's without the tornado expenditures. So the reason we want to show it both ways is so that you get a sense of... That aside, what's truly coming in and how is it going out? How are we spending that money every year?

With the revenues, just like every other year, we calculate this on the best available information and really looking at the trends that we've been realizing over the past 18 months or so. We'll talk about that when we get to sales tax and some other items. On the expenditure side... Other financing uses includes the transfer out to the capital improvement for tornado related expenses.

That's about $2.1 million. So you'll notice on the chart, there's 6% on the left side that drops to three tenths of a percent on the right side. So we do have money that we're taking out of the general fund reserves that we talked about. We're going to transfer that to the capital fund to make those tornado related improvements.

So streetlights, irrigation, those types of capital purchases. and then ultimately that reimbursement will go to the capital fund. And again, more to come with that in a minute, but that's why that 6% number exists on the left and not on the right side. But just like most years, personnel, if we just take the tornado portion out, is over 70% of our budget, right?

It's 73%. So by far our greatest expense. Contractual services is at 21%, and those commodities 4.3%. It always hangs out right around 4% or so.

And again, when we sit down with residents and we're going through the budget in more detail, a lot of times they're thinking, well, there's got to be some fluff or some savings there. Commodities is the first thing your mind goes to. Maybe we stop buying less of things, but you can see it's only 4% of the overall budget. So it's already lean to begin with.

And even if you start stripping out those types of things, you're really not going to save a lot of money here. On the personnel side, again, greatest expense that we're going to have throughout the year, but we are really right-sized to the services that we provide. So one of the things that citizen finance is going to be taking a look at is what are our service levels in all these different areas? We had this conversation during the pandemic and once or twice afterwards about some specific services.

If we were to cut whatever it is, what's the correlating effect it may have on our staffing levels? that's ultimately how you realize savings over time. So I would always shy away from any sort of across-the-board cut. And we've talked about this in citizen finance as well.

We never want to say, just go 5% across the board and save money. If we're going to save money or reduce expenditures, we need to be very targeted in how we're going to do that. We need to identify a particular service we don't prioritize over the others, and then make that cut. And then you'll save what you save through that process.

But when you start just hacking a percentage across the board, you really put yourself in a spot where you're probably taking away from some areas that you actually need the money to be there and you're making things more difficult. So your service level provision across the board, your service provision is going to deteriorate rather than being really targeted and just taking away specific functions. So A lot of conversation coming up at Citizen Finance on that because contractual service is very, very lean. Commodity is very, very clean.

Personnel, very lean because it's all right size to our service level. So that's the expenditure breakdown. Again, not much change over past years. I just want to, comparing the left to the right side because they're percentages and not dollar amounts.

If they were dollar amounts, would the dollar amounts all be the same except for other financing uses? Like is that where all of the tornado stuff is or was there tornado stuff in... other categories there's a small amount of contractual services so for instance tree planting is not a capital expense um so that hits the operating budget but we're getting very low on those types of items most of it is the capital outlay okay great question thanks any other questions on the expenditure breakdown Okay, as far as personnel is concerned. So in the fourth quarter of last year and we talked about this when we took on Maplewood, we needed to hire another staff member for our IT department to help service that city.

Of course that expense has the offsetting reimbursements Maplewood's paying in. um along with uh the you know all four partner cities so um we do have some offsetting revenue that is uh the only addition that we've had recently so uh that was an ad in the fourth quarter fiscal 26 and you'll see that in fiscal 27 the other thing that we had was um senior i.t support specialist we created that position so we bumped one person up to a senior level we needed that extra supervisory level given the number of support staff that we have to service the four cities so again that promotion that additional expense is offset with reimbursements from the other cities On compensation, we do have a step increase for all positions in the budget and we do have a proposed range adjustment effective April 1st. We have a 1% placeholder for non-represented positions. What I'm going to explain when we get to like January and we have a sense of what those other cities are doing is that range adjustment is going to take place for grades below grade 95.

There's a reason for this. Right now we are in negotiations with both police and fire unions, and so when we come to an agreement on that and set the salaries, for instance, within the police department with patrol officers and corporals, those salaries are going to go up. So we have to also increase at essentially the same rate to avoid compression, to pay for the sergeants, the lieutenants, the captains and the chief. So you end up pushing the upper end of your pay scale along with the CBA and really at the same rate.

We're gonna see the same thing in the fire department for battalion chiefs, the assistant chief, and also the fire chief. So they are all on these non-represented grades with other city employees. So department heads, you're really looking at upper management. And so what it's going to do is it's going to push some of those upper management positions up a little bit on October 1st.

So when we do the range adjustment on April 1st, we're going to hold all of the upper level positions and concentrate all of the range adjustment below grade 95 so that we can bring the rest of the pay scale up. But the top end is going to shift with the CPAs that are approved. just for clarity so i i understand the idea of not having compression but that's a choice we're making there's nothing legally that we have to do we could allow compression to happen if we wanted to to save money we're okay with yes okay i think we should or shouldn't i'm just confirming captains making more than battalion chiefs and that sort of thing that could yes i i just wanted to make sure that we there's a legal requirement that we'd have in the cba and then there's the flexibility we have in terms of the legal requirement it's more of Morale issue, equity issue, all of the numbers. Okay.

What David, but the 1%, the increase, you know, I feel like it was bigger this April, right? I mean, or what was the increase? So by 2% this past April, um, the market is starting to cool a little, a little bit, um, you know, cities and we've seen the news with cities around us. Uh, cities are starting to look at hiring freezes.

They're starting to slow the pace of some of the salary increases especially for non-represented positions because there's a lot of financial stress and strain out there so we're going to see what happens on january 1st and then act accordingly so that number could shift for now we just have a placeholder number in there as we get closer to the end of the year and we kind of know what those other cities are doing we'll start to have conversations about what number we actually want to plug in there But again, we'd like to concentrate that entire amount below grade 95 because they're not going to get that kind of CBA compression-related increase on October 1st. So more to come on that. There will be a lot of conversation about it as we start to get that data from other cities. David, we had, I think, an unfilled position for a long time, which we've now filled on someone, I guess it's Public Works or building to sort of patrol commercial areas, particularly downtown.

Was that simply, that's not a new position, but was one that was simply unfilled for a while? I'm just wondering. It was unfilled for a While and we realized some savings within the Public Works Department this year until that hire was made. But we've had that individual back in that position maybe six months at this point.

Yeah. Thank you. So it is filled and next year we anticipate it's going to be filled for the entire year. Uh, and I will point out too with that, with every position we budget as if it's going to all year.

So ultimately what ends up happening is you have some turnover at some point. So you're going to have some savings within that expense line. So when you look at the budget, we look at the deficit number in a minute that assumes that every position is filled for the entire Year. So typically your expenditures are a little less than what you see within the budget.

Um, And we hope the revenue is a little bit more, but you'll see like this, this past year that didn't necessarily happen. All right. The other thing I want to point out is the IT infrastructure group, which are our network engineers. We had that retention incentive that came along with the Maplewood contract.

And so those employees for staying on until October 1st, we'll get a one-time retention incentive. That's at $2,600 each. So that's again, down the, the, Public sector retention incentive is the only way you can really kind of account for these extreme circumstances and going into a city. I don't want to talk a lot about their condition of the technology that they had over there, but those network engineers are very busy building a new system very rapidly.

So this is certainly going to help keep them around and keep them happy. So that was baked in. And again, there's a reimbursement coming from the other member cities for that. Those are the personnel highlights.

Any questions about that? But you can see there's no new added positions anywhere. We're really not making any changes in that regard. Okay, so let's look at the breakdown.

Now, this chart can't be found within the budget that you received. This is good for presentation purposes. It makes it where we can kind of consolidate a lot of this. If you have questions, though, I may reference specific pages within the budget or you can feel free to and we can answer it from there.

But just to let you know that I can't give you a page number that you'll see this and we're going to show you this both ways so we're going to tell you the budget. As you see here, that includes the tornado expenses and also if you're thinking about 26 that one time Shell Park design expense but will also show it this way, which is. the annual budget without the tornado or the one-time expenses shown. So we'll go ahead and take a look at the with tornado expenses first.

The revenue is not going to be, it's not really going to change from one to the next. So not much of a difference there to speak of. As I said, the money that we get from FEMA for reimbursements is actually going to go into the capital fund. So on the revenue side, on property taxes.

We estimate at the end of fiscal 26 that our receipts are going to be about $8 million, so a little bit less than what we had anticipated when we approved the budget. We had anticipated about 8.3, so we were about 240,000 short. Next year, we anticipate that our collection will be up somewhere just below 8.4 um and so we have a little bit of an increase on the property tax side compared to last year's budget it's a one percent increase on the sales and use tax side uh we had anticipated about 7.5 we actually received uh we think we'll get through the end of the year about 7.3 million dollars uh so our target which was already conservative was uh short of that mark. The fire sales tax is still something we're taking a look at.

Those receipts are a little bit less than we would have anticipated. So we're trying to get to the bottom of that and make sure that that collection is correct. But that's a little bit of a miss that we had there. And next year, we just expect a 1% increase in sales tax one year over the next, looking from the adopted budget to the proposed budget or 3% above the estimated amount.

The reason you see the big jump again between 25, where it was 6.5 million, up to that 7.3 number, that's the fire sales tax being added is really the reason for that big jump. But sales tax receipts have been really, really stagnant. I know we talked about that with the financial report, but that's another area where we're just kind of stuck at the moment. We don't have big retailers coming online.

We're really just hotels and restaurants. There have been some increases at hotels and restaurants, but it hasn't really... you know, push this up much. I know that those increases, they're trying to be modest too, because consumers are kind of at the end of what they're willing to pay for meals and that sort of thing.

So it's a really tough time on the sales tax end when you don't have big box stores and that type of thing. David, the fire safety sales tax, is that something, who collects that? Is that the state or the county and- So the state collects it. And so it looks like there may be a category or two where the collections are lower than we had anticipated previously.

So we're trying to figure out what goes with that. Okay. That's good, too. All right.

So really modest increase on sales tax. Utility tax, this is always weather dependent. This number tends to hold pretty steady. Now what we've seen over time is a reduction in the number of telephones that people have.

So the telephone number kind of goes down every year. But we're really subject to seasonal, again, temperature changes. So electric utility bills and receipts are always higher when we have hot summers, and then the gas receipts on the inverse are always a lot higher when we have cold winters. So we'll see what happens with the forecast.

It's really hard to predict that, but that's what provides really the year-over-year fluctuation within the utility tax system absent any large increases in rates. Ameren is about to hold hearings for some rate increases, so we don't know what that might ultimately look like. But if Ameren does raise those significantly, then you'll end up seeing a bump in your utility tax collection. I have a question about utilities.

We just got a solar roof. So how does that affect... The trend in switching to renewables, does that have an impact on what we collect? It will reduce what we collect.

So the more energy efficient everybody gets, the less we'll receive because ours is just a gross receipt tax that hits a hammer. Are we planning for that? Um, not necessarily. I mean, there's some of those roofs showing up, but it's, and those types of things, uh, it reduces it some, but on the other end, like people are installing EV chargers in their garages and houses.

And so they're actually pulling more power from the grid for that. So, We haven't seen much of an impact at this point because it's really kind of working against each other. The biggest changes, and these mostly have happened by now, is when all the buildings started to change all their lights to LEDs and get rid of incandescents and that sort of thing. That's where you started to see a drop in utilities.

But most of that's been completed at this point. And I think the battle between EV charging and solar panels are going to really kind of wash it out. Any other questions about utility taxes? Okay, so if you remember the pie chart at the beginning, that's most of our revenue that comes in.

And as you can see, we're looking at maybe one, one and a half percent increases in these particular areas. So really, really stagnant on the revenue side as it relates to taxation. Intergovernmental, you'll see the jump here this year. It looks like a really big jump.

It is, that's the fire authority expense and that's Maplewood coming online with the IT services. So that's where that revenue is reflected. Grants and donations. We don't have as many this year.

I think we have, you know, the annual DWI grants, the Bulletproof Fest, those types of things. So that's where that revenue shows up. Licenses, permits, and fees. We're trying to anticipate what we're going to have as far as projects are concerned.

We had $4.1 million in that project. came in higher than we had originally anticipated for fiscal year 26. We did just get the receipt for the World Trade Center building. So that's something at the beginning of the year, we didn't anticipate that we ended up getting.

So that's what's pushing that number up. But as far as big projects next year, we don't have any that are looking really solid that have large permit expenses along with it. If that changes along the way and something really gets traction and is moving through our process, then in our quarterly budget amendments, you may see that number move a little bit. Otherwise, we think it's going to be kind of a business as usual year from a building permit receipt standpoint.

So relatively flat there, a little bit of a reduction from 26 again, because we got the big receipt from the World Trade Center project. But when you're estimating, David, you're not necessarily looking at projects that potentially are like pending projects before the plan commission, like a hotel. Not until they've come in this room, they've got all their approvals in hand and they're going through that building permit process because we've seen a number of larger projects stall out. So really until it looks like it's absolutely going to happen, we don't want to plan for our budgets around that amount.

Parks and Recreation, you can see this is relatively flat here. We had a few little increases to some different rates and things, mostly through the contracted things that we put on. So we pay, for instance, a tennis club to come in and run a lot of our tennis for us. A lot of the camp activities are actually private.

So like Sarky soccer and all of those. So we see some fluctuation there, but again, relatively stagnant on parks and recreation fees on fines, a little bit of an uptake uptick to 700,000 there. But that's relatively in line with what we've seen the past few years. No reason to think that we're going to write more tickets or get more revenue in court for any reason there.

So that's really kind of leveled off over time and health study. On the parking side, 1.9 is what we have estimated. We're hoping that having ParkMobile makes it where more people will actually pay on the street than might not have otherwise. They didn't want to download the Passport app and do all that.

Maybe a little uptick from that, but we don't have any big rentals coming online this next year or so. Once the World Trade Center project, which does rent spaces from us, starts to occupy spaces within that garage, you'll start to see that revenue get bumped up a little bit. When was the last time that we looked at what the fines were and what the parking cost is? I know there's always this line between how much you want to charge for parking because you don't want people not to show up.

But since more and more people actually aren't feeding meters anymore, I'm just wondering whether it's time to, if we haven't done in a while, to look at like what we charge for parking, what we charge for fees. Because you may be able to squeeze out, maybe we're not talking millions. Gary Carter may know the last time we had the conversation. It hasn't been within the last six years, which is when this technology has really kind of taken off.

We probably do need to talk about it, though, because one of the big conversations we had at the retreat was this kind of over time phasing out of the pay stations at certain locations and trying to migrate more to that app environment. So as we have those conversations, that's maybe a time to look at rates. And then I could tell you just from sitting in meetings this week with special business district subcommittees and incentive subcommittees, parking committees, And rates come up time like over and over again. So I think there's gonna be a lot of conversation in the next fiscal year on really all of those things.

And I was asking that because I would argue that we just we should be updating them, but also if you start thinking about. other ways to carve out revenue here and there and wherever like what what kind of things can we hit that may not be as noticeable as others it may not generate as much as we need clearly but like if i don't know what it would be the up parking 20 cents an hour or 30 cents an hour for folks they may not see it but it may actually generate meaningful money so mr carter now 16 2016 was the last time we reviewed uh both on street rates and fines Okay, so our obvious statement, but our cost to enforce and our cost to collect have gone up in a decade, but we haven't actually charged people anymore for it. That's correct. Our cost to enforce has definitely gone up.

Salaries have gone up. I mean, it costs a lot to run a municipal court and parking enforcement. Those salaries go up every year. And yeah, parking rates have held steady.

And would that be a larger conversation to have during the budget or a larger conversation to kind of start with special business district? I think given the conversations they've been having, which have been focused on rates as well, and they're talking about reductions in rates, I think that's where we need to make sure that we're aligned in those intentions. Thanks, David. Well, and I think they're also thinking about ways to potentially help small businesses out too, helping employees.

So yeah, I mean, I think it's, I don't know if it's reductions per se, but it's facilitating, you know, like getting coupons or, you know, helping people out who are just coming to the business district, but are afraid of parking. So. I mean, it's not the same as like a property tax clearly, but like, I want to be thoughtful if we're going to ask at some point if that ask needs to come and we've moved other things that logically would make sense or not looking at them in 10 years doesn't seem to make a lot of sense to me so that's why i wanted to ask and bring it up thanks okay um interest income you can see about 1.4 million is what we anticipate this year and um that's going to relate to the the cds that we have and when those come off um or when those uh actually be liquidated so about 1.4 million so still a good year as far as interest income is concerned we do have some miscellaneous revenue throughout the year that we book in this area but here's the big one from the special business district. So 588,000 is our anticipated receipts from special business.

And so that'll be used for economic development activities. That'll be used for events that we hold. And then also the parking signs that have been discussed. So more to come on those signs, but it's going to be illuminated signs that will show people where public parking is located downtown, which is as we've talked to people, there's, there's, maybe a misperception that there is no public parking downtown or you can't get into these garages.

And we're hoping to clear some of that up with these signs. So any questions on the operational revenue for fiscal 27? Again, these numbers are unchanged, tornado or not. I have a question on the grant side.

Based on what's the amount that's proposed, it would appear we don't have any like St. Louis County Parks grants or are those in a different? Those hit the capital fund because we use those to offset capital projects. So when we were talking about the VIP, it was captured there.

Yep. Great. Thanks for the reminder. Any other questions?

looking at expenditures down below again this has the tornado in there so you're gonna see some areas like administration where a lot of that expense is at okay so yeah with the tornado in there, we're looking at about $3.2 million in annual deficit, flipping back and forth between the two again. Let me take a look here. So you'll see some fluctuation here within admin where that number previous about 6.3 million, and then it's a little bit less. That's the tree planting expense for the first year is under admin because we actually push that money through finance.

But ultimately, the big numbers down at the bottom, the $2.8 million that's transferred out so that money is being transferred to the capital funds that we could buy streetlights, irrigation and those other items. When you go to the next one and show it without the tornado, you can see that number drops down to 700,000 within the insurance and transfers out. And now you're just really looking at an insurance number. So yeah.

Yeah, really big expense on the tornado side. The one thing that is kind of in flux right now, and we'll talk about capital in a minute, is the expense related to the roof repair over at 10 South Brentwood. So we had a long conversation about that this week during our tornado meeting, and it's kind of unknown what needs to be done at this point. whether it's a full roof replacement like was budgeted here or talked about during the CIP, or if we can do a smaller repair, which of course is going to be a lot less expense, a lot less corresponding reimbursement with it.

But that's something we're still trying to dial in and work through with contractors, with insurance, and also with FEMA. But that's one of the big drivers of that number that you see that's $2.8 million going over to capital. David, one question on the – when it says no tornado revenue and expenses, is that the net number? Because I know there's some tornado-related expenses that we're going to have to pay for.

Yeah, this is all tornado expenses removed from fiscal 27 on the operating side. So if I wanted to get a sense of – the net tornado expenses we're going to have to eat, what does that number look like? We'll have to send that separately. You won't get it clearly through here because the reimbursements are going to the capital fund.

Okay. So it's more than the $1 million, but it's less than the $3 million basically, presumably. Yeah. And it's hard to say because the roof is in flux, which is the biggest part of that number.

Okay. So we're really not quite sure just yet until we have some idea of what that expense will ultimately be. But presumably there's some – Some tornado expense we're going to have to eat that's going to make that $100,000. And that's about $100,000, so what we're going to eat for sure is the difference in administration, which is the tree planting because it's not reimbursable, and we know it's not, so we're going to we're going to be reimbursable at least 85% of it.

Okay. I was just trying to get a handle of what the number would look like. If everything goes according to budget, that $2 million transfer that we have from the general fund going to the CIP, that would be the city's share. So we would not get any reimbursement of that $2 million.

The reimbursement would go into the capital. Okay. On the capital side. I feel like what I was going to try to clarify might be related to that, but...

when you have these two slides, one that's like with and one that's without tornado revenues and expenses, but we're taking what I'll call tornado revenues, which is FEMA reimbursements. We're receiving those into the capital fund, but we're moving money out of the general fund into the capital fund to pay for some of the tornado. So that's why it's hard, I think. What I was going to explain in a few minutes is when, especially with the roof because that's such a huge number, but what, What we'll end up doing is that the council has talked about using $3 million from reserves to go towards the Shell Park project.

What we'll do is we'll take whatever FEMA reimbursement goes back into the capital fund and put that towards the project, and then the balance will come from the general fund reserves. So we originally envisioned all $3 million would come from the general Now that we're sending general fund reserves to capital and a reimbursement is going to capital, we want to capture that money and then match it up with general fund reserves to pay the $3 million. Rather than have the general fund basically sending money over to the capital fund for other items when we had discussed as a priority of the $3 million expenditure for the Shell Park project. Does that make sense?

I don't think I understood why you said it. I'm sorry. Yeah, so we don't have a tornado fund, correct? Right.

But what's happening is we're going to spend $3 million on Shell Park, and we talked about it coming from general fund reserves. Rather than just taking another $3 million out of general fund reserves when we're already sending money to the tornado, which is depleting those reserves faster, We want to take the money we get back from FEMA, right? So I'll put it this way. We send the money to the capital fund.

We spend the money on the project. FEMA reimburses it. And my right hand's way over here because it's working in the capital fund. So this money is coming back into the capital fund.

And what we want to do is we want to reach over for Shell Park and grab the reimbursement money from FEMA because it originated from the general fund. and pull it back over and put it towards the Shaw Park project. And then whatever the balance is, because that's only going to be a fraction of what we need to pay for Shaw Park will come from the general fund. So the project, that FEMA reimbursement that's going into the capital fund, we don't want it to sit there and get spent on other capital items because we've identified the project we want to use it on.

So rather than 100% coming from the general fund reserves, you're going to have 40% come from the capital fund reserves and 60% come from the general fund reserves, but it all originated in the general fund. But why do you have, like, why? Because we're making the capital expenses out of the capital fund. But the capital fund doesn't have the money to do it.

So we're pulling the general fund revenue over so that the capital fund has enough money so we can buy streetlights, which are capital items. Okay, that's important, though. We don't have enough money in the capital fund to make the capital expenditures that we are planning to make. For the tornado?

Right. We don't want to lock up that much money right now, correct? Yeah. So that's part of your motivation.

That's like an important. That's the whole idea is we've said all along, we will pay for the tornado with general fund reserves and leave the capital fund reserves unchanged as it relates to the tornado. So you're basically, you're basically loaning money to the capital fund, paying it out of the capital fund. And then when they reimbursed, you're going to pay the loan back to the general fund.

Yeah. I wish I would have said it that way. Right. Both of you, we got there.

Yeah. Interfund transfer. I still, I guess I'm a little confused with the numbers or maybe David, it's just get it to, it's like, if I'm trying to evaluate what we think the general fund is going to be at the end of the year and what we're actually going to lose, I get, if we're going to show with no tornado expenses, we know there's, again, there's some level of tornado expenses we're going to eat. I like seeing it both ways, but I'm still a little confused as to how much red are we taking on?

Well, that's why we want to show the budget without tornado expenses muddying it up because that money is all going to the capital fund. We'll show you the fund balance both ways too. Okay. So you're going to see exactly how much money you have at the end of the year.

Okay. in the general fund we are still going to lose some money related to tornado in 2026 because there's costs that were you're going to lose a hundred thousand dollars okay well okay so that makes sense it's not reimbursable karen image something about tuesday and that's when i started getting confused we're talking two million and a hundred thousand two million is going to the capital fund and you're going to get a portion of that back but it's going to come back in the capital fund it's not going to come back on the general fund where we're going to kind of recapture it is when we do the shaw park project It won't be fully general fund reserves. It'll be a mix of those capital fund reserves and general fund reserves. So in a year or two, we should either see some transfer back in the general fund of this large sum of money.

You'll just see two different funds. Or it'll just all kind of flow in. Yeah, they'll just work together to pay for our portion of the project. We'll just pay for it out of the capital fund.

This debt money, you won't even move it back to us. I mean, really, all we're trying to do is we have to get this money from the general fund to the capital fund because we're buying capital items. Before you have the money. That's all we're doing.

And so when the reimbursement hits, unfortunately, the reimbursement doesn't go back to the general fund. It goes back to the fund that was used to purchase the items, which is the capital fund. And so we'll just pick that money up later when we want to do Shell Park. That way we don't have to skimp on the normal CIP projects.

Correct. We don't want to leave. We don't impact that at all. Well, in the $100,000 you're talking about, is that just trees or is that the 15% that's non-reimbursable?

It's just the trees. But isn't there also the 15... 2 million is the non-reimbursed amount. What is the 15% match amount?

The 2 million. That's our match. For the... Or remember, we have a $4 million roof project and they're on top of the Y down in the streetlight, their items on the capital side.

So that's what that is. Okay. Yeah. So I think I'm just trying to get out to is like, would there be another way of looking at it?

That's like, what were all of the things that we spent out of any fund that were related to tornado response and recovery? And then we would just identify the money that we received from FEMA, SEMA, or if we get donations. And that would be what we received. And it sounds like you expect that to end up being something like $2.1 million.

Yeah. this point but there's this big unknown of the big expense the biggest number is a question mark um so what we'll do is this we're going to put this together in a way you can see it in it and it's very clear always confusing when money is in all these different funds which is why you eliminated all the transfers oh i know we used to have it used to be worse unfortunately for this in this particular instance we we have to transfer because we have to support the capital fund with general fund reserves Otherwise, we wouldn't be doing that. I just want to make sure that those 50%, I want to make sure I can track where those are. So if it's going to come out of the general fund, because we're going to have to eat it, that's fine.

If we're not, it's going to go somewhere else. What we can do is we can show you each project and then basically what the expense for the project is, how it's being paid for, where the reimbursements are going, and then we can aggregate all of those numbers. Yeah, I feel like that would be helpful because then there's not – I mean, there are a lot of projects, but they're grouped together pretty well for the tornado. So I feel like it wouldn't be that – I should say it wouldn't be THAT hard, but it's not me doing it.

Especially in this estimate, it's $220,000 without, but if there's another $2 million of the 50%, then that number is really $2.3 million if you got up to $100,000 as well. And that's what I'm trying to figure out. What is that actual number that we lost 2026 that we're not going to get reimbursed for? Is it 320,000?

Or is it 2.3 million? It's maybe 2.3 million. We don't know because a lot of it's going towards that roof. Just trying to get like a hand, because this looks a lot rosier than the other.

I would say you're at least 1.5 or so. Yeah, this looks a lot rosier because this act is as if there's no tornado. We're just looking at our ongoing operating expenditures versus our ongoing operating revenue. That's what this one here reflects.

So there's a lot of tornado noise that's in there when you look at the aggregated numbers. So when somebody just looks at our budget, they're seeing it with all the tornado stuff mixed in, which makes sense. makes it look like we're running this massive deficit of 3.2 million dollars but a lot of that is one-time expenditure um so it's always helpful to look at what's our ongoing operating situation and so that's what this slide here is showing you an extra line of like one-time expense may make it would have made it clearer yeah at the very bottom but i understand yeah Okay, so here's the expenditures themselves. And this is broken down now by department.

So legislative, we had a little bit of a fluctuation there. The only difference really is that we had some money budgeted for a facilitator for the retreat this past year and we didn't utilize that to have a third party come in and help us with like strategic planning. We talked about strategic planning a little bit in there. But if the council ever wants to do that, we'll put it in the budget.

We can bring somebody into facilitating type of work. Does legislative, David, include lobbying expenses? It does. And that's unchanged year over year in there.

This is conference. This is city council pay, mayor pay, those types of expenses. Meetings you might go to, all of that. So on the admin side, you can see there's an increase to the admin budget.

It's 5% over last year's budget. So that's the IT new hire is showing up now in that particular line. We do have some software purchases that are going to be made this year. And then the website is being overhauled.

So you're going to see the website contract on an agenda here at the next meeting. So that'll be all ready to go. So those are some of the things pushing that increase. So again, salary increases, IT new hire, software upgrades in some areas, and then website overhaul.

Planning and development up 9%. If you look at the number itself, you can see it's not a huge jump. 90,000 of that is a third-party parking study. So to come in and look at all of our parking regulations and help us really with that zoning component.

So that's something that we can't do in-house. We've been doing a ton of work in-house, as you know. without consultant help. But that's a particular area where we're going to have to get a third party in to take a look at all of those standards.

We've run into issues where we just kind of leaned really heavily on developers. You know, when they come in, they'll pay for a parking study, we'll hire the parking consultant, but those numbers have been off. So some of these recent projects have been under parked in some areas. really don't see anybody over parked at this point.

And we want to make sure that our regulations, um, are really up to date and modernized. So we have a consultant fee, uh, that's been included there at 90,000. So that's what's driving that increase, uh, on the PD side. Uh, we had some savings this year, uh, from the, uh, uh, the adopted budget.

If you look adopted budget to adopted budget, um, not a, not a huge jump 3% there 6% over the estimated amount. Um, So not a lot from a percentage standpoint, but what you're really looking at are salary increases related to the CBA primarily and a little bit of an increase with dispatching. So I think we went from $530,000 or so up to $600,000 this year for dispatch services. On the fire side, 11% increase.

Again, a lot of this is CBA-related. Medical supplies also went up, but the big thing there is the fire authority study. So we're, again, paying the bill, but we had the offsetting reimbursement that's showing up under intergovernmental from those other partner cities. So it's $40,000 is what we've put in per city, seven cities.

$280,000 is the expense that's budgeted for the consultants. On Public Works, relatively flat here. Not a really big change there. The thing that's really kind of the moving target within Public Works is our fuel costs for next year.

Fuel has been, as you know, all over the place. We completely undershot our fuel budget this year. So you can see our estimated amount at just over $6 million versus the 5.8 we anticipated. A lot of that's attributed to gas prices.

Parks and Rec, you can see we've got an increase there. over the budget amount from the previous year. And then that's mostly due to the big changes, the one-time expense. So we say no tornado, but it's really no one-time expenses.

Remember last year, the Shaw Park design was actually paid for at our parks in Iraq. It was a one-time use of reserve money. So that's why you see the jump from 3 million up to that 4 million number. And then now we're back down to 3.5.

So the Shell Park design was really kind of captured in there, and it throws those numbers off a little bit. But Parks and Rec, about a $3.5 million budget this year. And then insurance and transfers out. Again, this takes the transfers out of the equation, at least the big one, which is the tornado.

There's still a little IRF contribution in there, and then we're looking at insurance stuff. So at the end of the day, we're looking at a roughly $1 million deficit. a $220,000 deficit to end fiscal year 26, but a million dollars next year. And I'm really not surprised by this.

We've kind of seen this coming. And when revenues are this stagnant, and we're talking about 1% to 1.5% increases in a lot of these areas, 3% year-over-year from budget amount, 2% over the estimated amount. And then you look down below, and we're going up 6% on the expense side. You're just going to end up in this situation.

So that's why we're exploring shared services and other things, trying to get... our operational costs down because we know revenue is just not keeping pace at this point. And we are really out of levers to pull before you start talking about things like real estate taxes, because we got the sales taxes basically maxed out at this point. It'd be great to get more permit activity, but you know, it's it's, it's tough given the current mix we have to really generate revenue at this point.

Any questions about any of this? Okay, so that's the general fund budget itself. As far as our reserves are concerned, our goal every year of course is to keep at least 50% of our operating expenditures in reserve in that general fund balance. At 40%, if we were to drop to that, then we have in our policy that we'll take immediate action to keep it from getting to 25%, which is the absolute floor.

So 50% is our goal every year. We anticipate at the end of fiscal year 27, this includes these tornado, expenses that we're going to be at 68% on a signed fund balance. When we project this out, and we looked at this at the retreat a little bit, the thing to understand though is this, when you're deficit spending, and now we got this million dollar deficit, it accelerates over time. That number compounds on itself.

So what's a million dollar deficit this year, when next year's 1% revenue increases and six percent expenditure increases that one million now is you know 1.8 and then the year after that it becomes you know three and so you see this thing just start to take off on you um and so the correlating fund balance really drops off if you're to project this out without any, you know, changes. So this is something citizen finance committees aware of. This is really our next part of the conversation is what are our alternatives to avoid this number from hitting that 50% number to try to reverse this. And we know that whatever, you know, action we're going to take, it's going to be pretty significant.

It's going to be bigger service level cuts, potentially a real estate tax increase, You know, all these things are on the table as we try to figure this out. But we're starting to head in that downward direction. And then this chart on the right, this shows our annual expenditures again going up over time. The little blip here where we with the trash decision, I'll call it.

Otherwise, that would have been a straight line. And then you can see that that hook where we were doing OK. We were able to cover our costs and put some money into our reserves over this time, but now you can see it's falling back the other way. the tornado help certainly helped this along we wouldn't have had our reserves drop quite so fast if not for that event but this also demonstrates why you want to keep a healthy fund balance because we were hit with a tornado we've paid for that we were aggressive with the tornado and we're still well above our target of 50 percent so um that's the reserve picture and we're going to talk more about those projections as we go um If we didn't have tornado expenses this year it'd be about 76% reserves, but again you really can't make those go away so 68% is going to be the number.

But this just kind of shows you the operational trend, if not for the tornado you would still have that that downward. you'd have that descent starting. So general fund projections, when we look at the raw numbers, the actual numbers themselves, you can see again, 68% is our projected fund balance at the end of fiscal year 27. There's that deficit number of $3.2 million that you see there.

And then down here below, if you're looking at it and you take out the tornado expenses, about a million dollar deficit, 76%. So we are headed forward. um, and a downward trajectory with the, uh, the general fund. And what we're going to do with citizen finance is really try to project this out.

And so they can get a sense of how much time we have before we hit that 50% number so that we can start to be thoughtful about when we might implement some of these changes going forward. All right. Any other questions on the general fund? We talked about it, the retreat, and we kind of talk about it every, you know, every chance we get as far as what our trend line is here.

So hopefully no one's surprised with what you're seeing here today, but it is a challenge we're going to have to deal with. All right, the sewer lateral fund. We have the program here in the city where everybody pays a $28 annual assessment with their real estate tax, and that money goes into a pot. And if your sewer lateral breaks at your house, you can apply for this program and get a $2,500 reimbursement.

Last year, because we were running these big reserves, we increased it from $2,000 to $2,500. And so you can see the tightening in 2027, given that extra amount that we're putting towards it, where expenditures is catching up with revenue that's reflecting that that that that movement there. We have built up a little bit of a reserve, which you want in case you have a really bad year with sewer laterals that you can cover that cost. But that amount we want to hold steady at $2,500 for the reimbursement in fiscal 27.

And you can see again, we've got a little bit of cushion there. It's about $20,000 in surplus that we expect to put in the fund balance for the sewer lateral program, but a good program to have in place. And we're always thoughtful about keeping enough money in the bank in case again, we have a bad year. The Special Business District Fund, we talked about this at a recent council meeting.

They have approved their budget for the year. And you can see that's, again, an additional property tax levy within the downtown area. And we use that for marketing, economic development activities, events, and that sort of thing. We have the total revenue there, and then that's basically the transfer out.

So it comes into the special business district fund as it's collected, and then we transfer that money to the general fund to be spent. The reason you're seeing that lighter green number be taller than the dark green number is we've got a little bit of reserve and we're sending that too. So everything we've got within special business district fund is going to the general fund. To really pick up the added expense of those, the lit parking signs.

And we did talk about events with Dia de los Muertos. That money, if you remember, there was not enough in the special business district fund to cover the lights and that event. So that's hitting the general fund under that admin category, but it is funded in this budget. But my replacement fund, we talked about this with the capital improvement fund.

Again, this is where we save money over time for major purchases. And after it's made, we save for that next replacement. In fiscal 27, we have 30 pieces of equipment that we're going to purchase throughout the year, 14 vehicles, 15 equipment pieces, one facility component for a total of 30 purchases. This fluctuates year to year.

The amount fluctuates a lot year to year. That bubble may push again. I know that stuff's been delayed. We just talked about, I think I mentioned at the last council meeting, I think we're looking at maybe October now.

So that could actually creep into the next fiscal year before we take delivery of our fire trucks. So that one just won't go away. We're hoping that we get them at some point. How many vehicles and motorized fleets do we have?

Like is 14 a quarter of them, a 10th of them? Like, is there any... I know if Matt has any idea. I want to say around 125 that I think includes some smaller engines, but I would have to get that number to confirm.

Even that's helpful. Are they all on the same replacement schedule, like useful life schedule, or are they all different? They all have different lives, depending on their use, the type of vehicle. Some are five years.

Some might be 15, 20 years. Got it. Okay. That's helpful just to have some scope as to how much we're talking about.

Yeah, I can get a more detailed number. Sorry, I don't have it offhand. I'm good. I just didn't know whether you're talking 20 or 100 or 200 for that matter.

Matt, before you go, just because Susan's on here and she might ask, but we're not purchasing electric vehicles yet, right? So the vehicles that have come up for replacement have not been identified. I think the vehicles that we were looking at, we've actually extended the life on for replacement. So rather than replacing those vehicles, we're just continuing to utilize the existing vehicle.

Sounds good. Just asking. Thank you. The equipment replacement fund, um, the numbers themselves, you can see here again, a really big number that stands out in fiscal year 26 estimated at that tiller truck gets pushed into the new fiscal year.

I guess that will move with it. Um, but anyhow, that's, that's the big bubble that you see there. It results in what looks like a big annual deficit within the equipment replacement fund. Um, the equipment replacement fund, you know, revenue, um, You can see that number here, $3.5 million.

So that fire truck number really kind of pushes it over the edge. But anyhow, you're going to have up and down years as far as your revenue versus expenses based on the type of equipment that you're purchasing. But we do have this fully funded at this point. We've updated the numbers.

We do have that additional catch-up amount within the capital improvement fund that we added, which was like $100,000 a year to help shore that up because we didn't anticipate inflation going up quite as quick as it did. But we kind of made those adjustments over time and we feel like we're in pretty good shape right now to fund everything that's within the plan. And this is kind of a procedural question, but if we know that fire vehicle that isn't going to come in, will you reflect it in the 27 budget before we approve it? Or will you wait and do it as an amendment?

Like, how do you think about what we know the delivery date's going to be? And so right now it's still, we don't know if it, happens in time or not if it if we know for sure it's going to be in the next fiscal year and we got enough time that we can make that change um if we run out of time and we go ahead and adopt this budget and it ends up happening where it is next fiscal year then it would be in the budget amendment five-year cip so we had a resolution that approved the cip earlier this summer And again, fiscal year 27 really big number here and it's tornado expenses that are largely driving that. So $13.7 million is what we anticipate for fiscal 27. And so when you approve the budget, you're basically funding that year of the capital improvement fund, capital improvement plan.

And so this is the pie chart that breaks down where the money's being spent. So almost 40% of that is tornado related expense. The rest of it as we, we, I tend to do around here it's it's almost all maintenance, so we were not really buying new items who are keeping up the items we have so micro surfacing on the streets parks and RAC, those are really just. Improving or updating things that we have nor shell or you know shelters ball fields all those types of things that you've seen over the years, as well as lighting within the parks.

That makes up the largest part of those projects, sidewalks and curbs, street lightings, improvements to our facilities, pavement rejuvenators. So really we're just in a mode now where we're maintaining things. So no new big projects within the capital fund. David, are then that streetlights, is that the remainder of the lights for downtown?

Like the rest of the lights that we had to take down being purchased in the next fiscal year? Yes. So on this one right in the middle of the page, you'll see CBD light pole replacements. That's $473,000.

Okay. So that's a large portion of that. But we'll be able to get those and put them back up in downtown in the next fiscal years. That's correct.

All of them that we've taken down to this point. Yeah, yeah. And then we do have a second phase of the inspections. So we're going to look at that next date range, which is 2001 to 2005 and check the condition of those particular lights.

But here's the project list that we looked at and approved. earlier this summer. And the big question mark is this line right here, the biggest one we have, which is $4.3 million for a slate tile roof replacement at 10 South Brentwood, which is the police building. And we have no idea what that number will actually end up being at this point.

So somehow we know in the next few weeks, I have a better idea, we might make some adjustments. But for now, we still have the worst case scenario as a placeholder, which is the 4.3 number. David, remind me again, putting aside the roof, like how much of this is from the capital sales tax and how much that is general fund transfers over? The tornado will be the only general fund transfers over.

Okay. The rest is 100% through. Well, it's not just the capital sales tax, but the parks and stormwater tax that hits it, the use tax, road and bridge. There's the railroad.

There's all these different lines within the capital fund revenue. I was just asking as we continue to think about instead of doing wholesale cuts, if that's what we decide to do, instead of thinking about projects. Could we generate any money back to the general fund by deferring capital? But if all the capital expenses are really being paid for outside general fund, it doesn't make a lot of sense.

We've done all of the transfers now on a normal annual basis. So operating revenue that comes in is purely operating and capital revenue that comes in as is just going to capital items. We used to transfer a lot of money back and forth, and that's where things start to get messy. And now if we decided to skip a rejuvenator for a couple years, it's not going to do anything for the general fund?

It will not help your operating budget at all. Okay. So those are the capital projects that we have coming up. Again, the big numbers are all tornado-related expenses, and we're back on the microsurfacing.

We took a break this year from major microsurfacing projects. We've got about a million dollars coming up next year to extend that pavement life out. debt service funds so just a recap of the outstanding debt that we have here in the city uh the 2019 refunding that you'll see here in a minute uh that is uh paid for through a property tax levy that's the purchase of the police building uh and then the parks and storm water sales tax which was the center renovation um So you can see those were initially financed in 2009. And in 2019, we had the refunding where we actually got a pretty big reduction on the rates along with these other refundings in 2021 and 2022.

So this one here, that was the police headquarters renovation completion. So the city had to borrow money a second time to finish off the police building. And there were some other parks and street improvements there. That's all paid for through the capital improvement sales tax that comes in.

The 2020 or 2022 general obligation bond, general obligation means that voters approved it and they approved a property tax levy to fund it. And so these were all the street replacements that were done in 2014. It can also be used for street lighting. And that's what we're using the rest of the money on right now is to finish up the street lighting in White Island Forest and High Point Daman.

So the final one, this is the new one that went into place last year, which is the municipal garage project. that renovation is being paid for with capital improvement sales tax. This is the outstanding debt that we have on the books, which is $30.2 million. $13.3 of that is the garage project.

The rest you can see, we're starting to get those paid down pretty well. The payoff year is coming. So 2032 sounds like a long way off, but it's not. It's right around the corner.

This is a fiscal 27 budget. So you're within that five-year range of having these paid off. So again, this is the purchase of the police building and center renovation. This is finishing off the police building.

This is the street reconstruction that we had, and this is the public works parks facility, the municipal garage project. A lot coming off the books in 2032 and 2034. But again, a lot needs to go back on the books probably because we have to replace those streets that we bought the first time and add in the street lighting replacement project. And remind me, was the special allows mostly it's capital improvement sales tax, a little bit of parks?

A little bit of parks and stormwater sales tax. So we'll get, it'll be an interesting discussion, right? Because we'll have freed up cashflow there that we didn't have to go to voters for, but then we're going to have this geobond So we may be able to bundle whoever we are, maybe able to bundle some of that together to keep the rate a little bit. Potentially.

But what will end up happening with the parks and stormwater sales tax? So that gets freed up because we paid that off, but you know, it was used for center Clayton renovations. So as soon as that money's paid off, the pool packs are going to have to be redone again. And you're at that point where now it's been, you know, 15 plus years and all of that needs to be addressed or an air handler.

It's just very expensive. Yeah. Okay. So when we look at the funding sources, this gets at your question there, Councilmember Jeffery Yorg.

The total debt service that we have is $4 million a year. $1.9 million comes from the property tax. So that's, again, the road reconstructions that were approved back in 2014, that general obligation bond. That's all property tax at $1.9 billion.

Sales tax is $1.5 million, and then capital improvement is $586,000. When we say sales tax, we're talking about capital improvement tax that comes in. We're talking about use tax. It's the parks and stormwater sales tax, all of that.

Yeah, it's got to be the amortization on the debt. Debt repayment by bond issues so this just shows what we're paying towards each one of these every year the debt service million dollars a year for the municipal maintenance facility project a million dollars a year For this the streets and then five hundred thousand for the the two projects over at the center. And then we have the 929 was the initial purchase of the police building. Here's that difference.

This 933 drops off. The police building is funded at that point. All right. If there aren't any other questions about that budget, the approval schedule is here.

So the work session today and then September 8th, we'll have the public hearing and first reading of the budget and also the annual property tax levy. And then we'll also have the center budget on that agenda that was approved this morning by CRSWC. So all of that coming on September 8th. I'll do a very abbreviated version of this presentation on the 8th for anybody in the public that might attend.

And then on the 22nd, second reading and final approval of both of those. And then October 1 is the start of the new fiscal year. So we don't anticipate any big swings or changes in these numbers at this point. If something happens with the roof, something happens with the fire truck and it might impact this, then we'll make those adjustments.

But otherwise, we're pretty well locked in on these numbers at this David, can I ask in connection with the Economic Development Committee, I'm sure there will be recommendations coming forward in the next few months about different efforts to accelerate our methodology in terms of promotion, marketing, these kinds of things. Is that built in here somewhere that we're going to have expenses that we didn't have previously? It's not. So if something comes up, we'll capture that within a budget amendment.

But I can't imagine that any of these We're not talking about a million dollars. Right. And so if we can absorb it within our budget, if we identify some savings by the time that budget amendment might come up, then we'll go ahead and try to absorb it. But if we need to do an amendment, we will.

Thanks. I have a question and a comment. That's where we're at. So my first question is, I think you alluded to this, but did the Citizen Finance Committee, have they seen this yet?

Yes. Right? So we went through this budget at their last meeting, which was a week ago today. And it sounded like they identified as a next step an effort to evaluate services that we offer or services that we offer, like at a particularly high level to try to figure out what areas might be for, um, might be available for savings.

I think is that they want to start looking at service levels on things. They also though, want to take a look at, um, you know, what else is available on the revenue side, perhaps? Just what are our different alternatives to stop this from happening? But one of those conversations will be service level impact.

So, you know, some are, and when we went through this last time, we were showing like leaf collection. Yeah, totally. I remember. And sweet sweeping.

Yeah, leaf collection was a part of that conversation. So those are the types of things that they would like to get a better handle on because they don't have any sense of the the burden with each one of those services. And I would just add that it wasn't, to clarify, it wasn't that anybody necessarily was saying we want to cut and not raise. I think it was to David's point.

Like, we've spent a lot of time on those committees talking about where we are, where our revenue is, what our expense is, and here are the challenges. And we all felt it'd be good to round out the conversation and be like, okay, like if we wanted to cut, what are the biggest drivers of service offerings? I think it's great. I mean, when we had the discussion, I think it was pretty soon after I was on the council.

So I'm not sure who all was a part of it, but like it did feel like, It helped see that the things that feel that I, for example, as an individual felt like were sort of extra either have a purpose that might be more important than I realized and or don't actually cost that much and save us much money. But I really welcome more eyes on that to think about it. So that's great. And they didn't have any other, like, particular feedback or...

No. I mean, I think that they all... I mean, it's all basically the same basic presentation. I'm not in this in depth, but I think they all have come to similar conclusions we're all at.

Like, these are the numbers. They ask some questions to try to understand them, but I think there are all nothing particular. Like, we shouldn't be spending this. We shouldn't be spending that.

I think it was, again, similar questions we've all asked, right? Why are you adding new staff? Do we need to add new staff? Why aren't we like, it was those sorts of things.

Yeah. And then my sort of like comment, which maybe includes a question, is that I think one of the potential problems revenue sources that we miss out on is a hotel tax because the state legislature has prohibited us from levying a hotel tax. And I was trying to remember if there are any other political neighborhoods that are subject to that with us? It's one of the I'll use the craziest sections of the state statute.

Because everything is broken down into these individualized areas. So are others impacted by a similar ban? Probably. There are more that are left out by complicated language.

So it's a very complicated section of state law to read. But it is something we could task our lobbyists with to see if we could get some sort of traction on that. Yeah, I just think it feels like something, whether there's another municipality who is in a similar position and would be interested in bringing it up. I'd be interested in understanding If we could levy one, what would it be and how much revenue would it bring in so that we get clear about that?

Like we're talking about an extra hundred thousand million. What? And then, you know, it it doesn't feel like. I mean, taxes are kind of a partisan issue, obviously, in Missouri.

But it just feels like something that could be possible. And so we could work with our own legislators if the Citizen Finance Committee and other people are interested in helping us build a case for it. I don't know. I would just add on.

what you were saying, like it would be nice, whether it's a lobbyist or whomever, to just find out – somebody comb through that code and be like, okay, who else in St. Louis County may or may not be affected? Who else in Jackson County may be? Because I think you're right, Becky.

The more cities can kind of all talk and be like, hey, we all got shorts of money and this seems like a relatively easy tax because it's generally taxing people that are coming up from out of town or whatever. Yeah, totally. At least you have a little bit more of a push to do that tacked on to some other bill that just kind of gets – gets through, especially it sounds like the people that drove the concern about it years ago may not be as invested as they were back then. So I'll reach out to our city manager network too.

Yeah. I think that'd be great. Yeah. And I think it ended up like when I've talked to, when I've talked with people about it, like more recently, it was thinking about it in terms of, I mean, I think it'd be great if we could talk to, you know, our state rep or state Senator where it could be something where, um, you know, whom obviously both are Democrats, but a lot of them, they seem to work, you know, putting some sort of addendum on a bill as sort of a compromise.

So it's not like it probably wouldn't be the main focus, but it would be something that would be added at the end. And also thinking about, I mean, it's like they're building this huge new Wild Care Park out in North County that they're I mean, they're really hoping to, you know, get a lot of people. I mean, they expect a lot of people to come into town, stay overnight. So, you know, thinking about how like some sort of hotel tax that isn't already.

So I think that's a great idea. But thinking about how we could, again, communicate with our elected state leaders who are both new and how they could help us. Yeah, it's a great idea Can I add on this? I asked earlier about the legislative, about lobbying.

I think next month probably will be the first meeting as it is every year of the County Municipal League. And usually those first few meetings are usually about talking about what are the things that are important to cities in St. Louis County. And I think the whole revenue side is always a very big deal.

We know Jeff City, to generalize, doesn't always seem to care a lot about St. Louis County, seems to be more rural oriented and sort of not always very sympathetic to our financial needs. So again, it raises that same topic, you know, what are our priorities and how can we be more effective financially? I know the Municipal League obviously uses a lobbyist, and I think the city shares in a lobbyist as well.

But I think it is an important topic that we keep fighting those because we don't have a very sympathetic government in Jeff City. And so some of these things like hotel taxes and other things, you know, we definitely need help on. Well, I think the one thing with hotel tax, unlike some of the other ones, is it already exists. It just doesn't exist for all of us.

So I think there is some what I understand. So it's an issue of fairness for us. Well, and that's the thing. Like, it may be a point where.

Maybe somebody in Jeff City may be more willing to say, let's just allow everybody to have access as opposed to some and not others. I don't know if it gets nowhere, but I think if we can figure out that it's going to generate enough money for us to make it worthwhile, then I think that's another avenue we should take. go down and nothing else, be able to tell the citizens we've tried. Because most citizens probably assume we're already taxing all the hotels that are built here.

And when you tell them we're not, other than the sales tax piece, they look sort of shocked, like, why aren't you? And we're like, well, we can't. Heather? The only thing I was going to add on the finance committee, because there was a question about, I mean, I think one of the hopefully positives about it is we have a number of citizens on the finance committee who I think are just And some of them are fairly influential, whether it's the CCBA or other entities within the city who are sort of learning what this is about because they don't come to this meeting.

If we had a budget meeting, they wouldn't come to that either. But we're sort of getting the point across to people of what are our financial dilemmas and issues. And what sort of the projected day, of course, always will ask, well, you guys going to have a property tax increase? And we say, well, it's not us guys.

It's you guys. It's all of us. You know, you have to agree that this is something we're probably going to have to look at in a few years and understand why. And so we're sort of we're getting ready for getting some support, but maybe three years in advance as opposed to three months in advance if we're going to look for revenue through a property tax increase.

Any other thoughts on this side? My question is regarding, like, how we account for unanticipated events like the tornado. So do we... When you guys go through this budgeting process, do you do modeling to account for, like, when the straightforward moves is closed or, you know, whatever, how fuel prices might affect the budget in five years or if another tornado were to happen, you know, or if it was a really mild summer?

Like, are you... Those are... Yeah, it's just hard to predict those things. So we've got to do our best to try to dial that number in.

If there's fluctuations, that's why we have those quarterly budget amendments. If we have big movements that we want to adjust the budget and make sure we capture that, that's an opportunity for us to do that. As far as anticipating major expenditures or making sure we can cover if there's a 20 or that sort of thing, that's why you want to keep that reserve level above 50%. That's really where that money comes from, ultimately.

But the rest of it, it's all just kind of things, you know, as it goes throughout the year and try to make those adjustments as they're known. But it's really hard to predict that stuff. And one of the things you asked was, you know, like five years from now where things might be projecting out in the future gets really, really hard. So we do these future projections where we try to guess where things will be five years from now, but it really is just a guess.

And we've really seen that over the past six years. If you think back pandemic time all the way to now, how much everything has just been a roller coaster, any kind of five-year projection, we were way off on a ton of these different categories. So anything beyond like two years gets really difficult. So the budget that you just saw is really just an annual thing snapshot.

This is where we think we're going to be next year. And the projecting, we'll do a couple times a year at the retreat and some other times, but it just gets really, really difficult. But the biggest thing is make sure that you have the reserves there in case you need them for something major that comes up. But in the end, budget conservatively on revenue so you're not, you know, hopefully not missing on the revenue side.

And always know that on the expenditure side, you probably have some room. There's no fluff in the budget. You're not going to find any line that's like miscellaneous this or miscellaneous general supplies, $10,000. We don't do anything like that.

It's all what exactly are you buying? How much does it cost per unit and how many units are you buying? So, I mean, we're very specific and we can see all of those things. The only movement that you really see is really on the personnel side, which is most of your budget when there's turnover.

Right. We know we're not going to keep all 182 full-time employees all year. And that's when you realize some of those savings. And that typically will allow you to absorb things like increases in gas prices and those types of fluctuations.

I'll just say, I mean, I think I've talked to a lot of you guys about this. Webster had approached us about sharing a sustainability position. They used to have a part-time sustainability coordinator and she left to go work full-time in the city of St. Louis.

So they had approached us, I don't know, maybe about four or five months ago about sharing a position. David and Matt and I met with Laura Arnold, their city manager and their public works director in June. And I think definitely had a productive conversation. I understand why potentially that kind of I guess our share of the position is not in our upcoming budget, but I'll just, you know, it's disappointing in the sense that I think we all want to continue to explore ways to share, you know, share roles with other cities.

I think sustainability is a huge, it's something that our community cares about it a lot. That was very clear that came out of our comprehensive plan. We have an incredible sustainability committee, especially led by our chair who does a wonderful job, but I think creates a lot of work for our public works director who already has a lot on his plate. So I just hope that we can continue to look at ways to potentially explore having this position.

I, you know, I know there's some reluctance, David, and I've talked about this a lot. I know there's reluctance on finding the right person because if we don't find the right person, it'll be somebody who's just creating more work because they're just asking Matt to provide answers to questions that he or she might have. So I just hope that we do continue to potentially explore that idea, whether that's sharing, you know, sharing it with a third city. I don't know.

But I think it's just something that I hope we think about in the upcoming year, you know, going forward. So. Um, but I don't, but I, David, I do want to say thank you. I think, um, you always do such a great job with this budget presentation.

Um, thank you to all of you in the audience. I know you guys work hard to put this budget together. Um, so we all sincerely appreciate that. And, um, But I don't, I don't have any other further questions if anybody else on the council has any further questions or comments.

Can you tell me what? what this is, the Distinguished Budget Presentation Award? Yeah. So every year when our audit is complete, we'll submit that information to GFOA, which is the Government Finance Officers Association.

And they have a number of, we've gotten this award for years and years and years. But if you meet all of their standards, then you receive this particular award. And how many years have we gotten it? 19 in a row?

Okay. Well, congratulations. So we anticipate we'll keep it up, but yeah. Clearly I have not looked at the budget before.

Yes. That's a great question. Kudos to you, Karen, and kudos to you, Kayla. I know you're back there as well.

I know you are a big part too. It's really kind of the gold standard or the seal that you want on your annual budget so people know your numbers are consistently good. Okay. One last question.

Do you know how many open positions we have right now? Like in a range? Currently? Full-time positions?

Maybe three? Okay. Not many. The last thing I'll just say is I just...

We... We just found out the city of Delwood's mayor passed away suddenly this afternoon. So I didn't know him personally, but I have met actually a councilman who is on the Municipal League Executive Committee. So my thoughts and prayers go out to Mayor Reggie Jones' family because I think it's pretty sudden.

If there is nothing else, I will take a motion to adjourn. I move that we adjourn. Second. All those in favor?

Aye.