Town Council Budget Work Session

when he's still behind.

Yeah. What?

I aliance to the flag of the United States of America and to the republic for which it stands. One nation under God, indivisible, with liberty and justice for all. Thank you so much. We do have page here. Before we move on, I do want to thank all the managers and director for bring us to this point. There's been a lot of work involved by say this. Can I just say the uh force we're not in a rush today. I think that's clear. Um I know what you expect information and they give you direction and work there. So I'm very excited about make sure everybody's clear on that and we have a lot of people in the back room. So for council people at this point I turn over to Mary.

All right. Thank you mayor. Good afternoon mayor and council. We are excited to be here to talk about the budget. We also want to echo the thank yous to you all. We know that you amount of time to go through budget documentation. It's a 200 plus page book. So we know it's taking effort to get through that. We also thank you for taking the time to do the one-on-one meetings with the staff. Those were very to better prepare for today. So, we've got a plan to go through a slideshow. It looks like more than the slides are all integrated. So, we're not going to hit everyone separated. We'll have a slideshow. Then, we have included a budget activity. So, it will be similar to what you all did capital projects activities. just felt like that would be a good way to build consensus. So, we're going to attempt to do a budget activity

to see with a couple teams if we can build consensus and not do Mayor's point. We are happy to receive consensus and decisions today. We still have time and we can talk about next steps at the end. So, if we're ready, we'll dive on the slide questions along the way. All right, turn it over to Jessica. Um, today we're going to hit on all of our major funds as well as some of our special funds. Um, and then as Randy said, we'll hop into that. So, our total uh town budget is 264 million. Um, 124.6 million in the general fund, 3.7 million in the storm water fund, 70.6 million in the electric fund, and 35.6 in water sewer. And then we have 29.4 for um for our non- major funds as well as debt. So looking at the general fund, that budget is an 8.26% increase from the FY26 amended budget. Um and on our expenditure side, um personnel is um overwhelmingly a major cost as it is for um all local governments. And then um just that our capital this year has um risen back to that 12%. So just looking at the revenues a little closer um ador taxes is increasing based on the um increased rate recommendation. Um the 12% increase in other taxes and licenses. Mo majority of that is from sales tax. Um it's just over 3% increase from our um year-end estimates for how we're going to finish in FY26 because we're up about 7% year-over-year. Um in terms of unrestricted uh intergovernmental that's up 12.8%. Um a lot of that is due to the utility franchise tax that we receive. Um that is performing very well. Um in terms of

restricted intergovernmental um so a lot of that is um transit and our program uh has grown this year. So that revenue source has grown as well. Um let's see permits and fees that is down um 5% 5.7% this year. Um that's trending with our um permit numbers as well and uh just based on a three-year analysis that is kind of where those lines are um heading. Sales and services, this takes up um a lot from parks and wreck and our yard waste program. So um bringing the yard waste up to 100% cost recovery um is part of that increase but um our parks programming and rentals is up about 17% year-over-year. So um those revenues are showing in that um interest rates are decreasing which um in terms of investment earnings for the money that we have um that is showing a decrease. Um we are using our transportation capital reserves this year to cover the um annual pavement management program. So the increase in other financing sources is our transfer from the reserves back to the general fund. Um that is from our motor vehicle fee. So $5 of that um lives in the general fund for transit and the other 25 goes to reserves. So this is us utilizing those funds for um payment management. And then we have about three million for fund balance recommended

terms of the uh investment

revenues uh you guys are going down by you know a third

uh interest rates are not going down by so why are we kind of out of the decline

so I'm gonna on you John because we had presented this a little bit in the February retreat about um interest

earnings are looking to go down almost 30% for some and based on they're already down this current year. So um that's also part of that increase that we're seeing.

Um I guess probably the easiest thing is that our portfolio on our actual direct portfolios that we purchase into kind of unwound early last year. So trying to build that back. Um it's possible we have some adjustments figures but it is still federal funds right lowering for these prior numbers. So

yeah but again my full basis point is is not anywhere near 30%. And so I think you're saying like it's a combination of having a lower balance that's proving the interest plus a lower rate is leading to 30% reduction

for the property tax recommendation um for the FY27 budget is at 39.14 cents. That's 3.54 cents above um current year and then go to the next slide to dive into the bucket. So, 1 cent was dedicated to public safety. Um, this is six new patrol officers, um, a corporal, a special operations lieutenant, and all of their, um, capital and operational equipment, and then the fire inspector as well. Um, this adds an additional 1 cent allocation to the community investment fund to take it from seven cents to 8 cents. And then um 1 cent is for a fleet replacement program to get us up to the level of replacement we um need to be addressing each year. So it's 25 police vehicle replacements, four parks and wreck and one fire vehicle. And then um the final 0.54% was um partially uh expansions in parks and recck programming and um and then smart cities

um projects. So this chart will look familiar from the budget presentation. I won't spend a whole lot of time on this, but just wanted to point out the different cycles, right? We're all familiar with that now with valuations and how you typically will see a drop and then there's a little bit of incline pattern four years. We did want to highlight where we are postal how that compares to previous time periods. So you can see that's been circled in yellow. Again, we can come back to this if there are questions. The next these are some new charts because as we've heard other jurisdictions coming in uh and then the comparison okay well they're they're not coming down any or they're not proposing anything. So there are a couple things that are happening. Some of the jurisdictions are proposing their budgets with a gap and no solution proposed with that. We could have we could have done that too and said hey we're not recommending raising the taxes. We just have an $8 million gap. So, it's implied that you either have to cut or you have to raise taxes. So, we went ahead and filled that gap to said this is what it would take to fill that gap. Uh, so that's one point I wanted to make. The other, if you look at the chart on the left, there's a lot going on here, but this shows the after the reval, we were the second highest drop from actual numbers. So, this is a 10-centent drop. Garner was the only one that topped us at 10.7. When you look at in terms of from a percentage drop, we were the largest percentage drop after the rebound, the garner was a little bit higher in terms of they had a little more room to come down. So that's the chart on the left. It just shows you where we came down after the rebal. On the right hand side, you can see where we are post rebal. We've come up uh from revenue neutral. This is in comparison to the revenue neutral point. So in fiscal year 25, we were about 13% above revenue neutral. Then fiscal year 26 it's 18 I think is what I'm reading there 18%. So we've come up above some of the jurisdictions. This again we

think is in play. We've started to hear and Jess will talk about it on the next slide but we've started to hear some jurisdictions are proposing some slight increases. Um but we're still if you look at the the numbers some remained flat but they were higher than us as well. And so trying to bring some perspective to the comparison when we look at other jurisdictions being at a much higher tax rate, they were able to stay flat or they only came down 5%. I think there was one jurisdiction, yeah, back on the side, Zebulun actually went up after the rebound. So they've got a little more room potentially in their budgets to to play and hold the line. Uh we gave a pretty significant as a jurisdiction gave a pretty significant reduction in tax rate rebound. So this is just more data. So, can I react to this for a moment? Um, because I think this is good data, but it's also slightly misleading because this would lead one to believe that an absolute dollar tax that's not the case. Like we saw a big tax increase across the board last year following the rebal. Um yes we dropped significance in terms of tax rate but the net effect on the after property owner was still a significant and so I appreciate offering some perspective but what is more telling is the you know the absolute dollars that are basically the out that we're putting on again like I appreciate the context but I don't want to distract from the fact that we did significantly increase taxes. Yes, last year, you know, as a the function of the well. And I think it's a good point and what we were speaking to is what we had impact on. So obviously we don't as a jurisdiction set those values, but we do set the tax rates. So we were trying to bring

attention to what we as a jurisdiction impacted on. Uh this one is this this is the actual

Oh, okay. Yeah, this is actual pennies. So the others spoke to percentages. So this takes the pennies. It kind of puts in perspective where we've been since the rebound and where the revenue neutral point is. So you can look at the raw data, where everybody's gone since the rebound. Actual pennies above the rebound point, the neutral. Again, lots of data points to look at and see where we're sitting. Uh we're not the lowest, but we are definitely in the lower lower third maybe if I had to cut that up a little bit.

So, pretty good perspective given context. Right.

Right. So, we've started to get some proposals around Wake County. Um Wake County is um proposing a 2cent increase. Um so is Pway and uh Garner is proposing 2.5 cents increase. Uh roll and wafers are staying flat. And we're also starting to see some municipalities um presenting a gap that they have. So we calculated out what that difference would be um if it's uh based on their gap. And so the gap that Morrisville um presented was a 1.75 increase. And um so the 13 million for Raleigh, that's not their full that is their um absolute minimum. So we'll be getting more information next um about a week and a half from now, but their absolute minimum is the 1.11 cents. So um of of those that have started um proposing official tax rates, they um we're the average is sitting right around uh 2.15 cents. So, looking at rigs for the general fund, um there's no change to solid

waste or recycling um for two years. And then our yard waste is increasing by $35 per month. And that will bring us to 100% cost recovery for that program. Um some strategic goal alignment in the general fund for a welcoming community. We have uh budget park shade structures, vision zero traffic safety and crosswalk beacon upgrades for high performing government. We have uh some IT infrastructure um HR info modules for personnel management um strategic plan refresh for environmental leadership. We have automated side loaders to move our base program to containerization. Um the plant the peak program and our Impira energy management software and then responsible development. Um our transit program has grown a lot this year. Um we have our annual payment management program and then um our campo um and then uh economic vitality. We have our our state magazine feature, our economic incentives and um some CRM management software. Moving into the affordable housing fund, um the FY27 allocation is 3.8 million. Um it is a dedicated 1 cent of the tax rate allocation. Um however, 2.9 million is above 2 million. So um that is because we are using um fund balance this year. So our available fund balance is 5.3 million and we are recommending using 1.7 million of fund balance for the acute street. Looking at our debt service and community investments fund for FY27, the allocation is 16.4 million. That's a 8 cents um tax rate allocation and that is an increase of 1 cent over um FY26. So 10.1 million of that will be going for debt service payments and the

remaining 6.2 million will remain in the community investment fund for um future debts. Um this allocation sets up for the u funding the five-year CIP that was created um in February. So just a quick recap on that. um the projects in the column on the left, these were projects that u when you all were split into two different groups that you both funded in your separate groups. So um everybody had consensus on these and then we filled the rest of um once we knew the dollar amount for all those projects, right? We filled up the rest of that initial seven cent um community investment fund uh allocation. So the middle projects are the ones that filled that um got us to that seven cent point. And then the column on the right is the projects that were specifically um chosen um to use for the one sentence. So for special appropriations this year um they will not appear in the budget book um as an allocation. So we are um doing $1 per capita which is um so we're planning for 81,000 and our farmers market has also requested $20,000. So both of those appropriations will come out of our um our bud capital fund. We had um utilized the fund funds originally for um offsetting public safety salaries during COVID and so we still wanted to use that money for um projects that aligned with the intention of ARPA funding. So, um, the project, one project that was specifically outlined was, um, $500,000 for a nonprofit program. And so, um, we are going to start utilizing that funding for the allocations, um, this year. So,

I have funding to hold the farmers market out of the rest of the population.

You mean the regular budget?

Yeah. Because we felt like it fit under

the criteria for AR. But the 81,000 also those department.

Yeah. So um I think because the request was positioned under economic development.

Yeah.

And I think it was This is a request made every year.

This is a request that we fulfill every year.

It essentially is a budget allocation to

they they did I believe make an additional request.

Traditionally they 20,000 is more than what

it's varied over the years. I think at some point it was 20. It might have decreased when we started setting the dollar um uh per capita but um last year's when it moved out of nonprofit funding into economic development for a while.

Yeah, I think it was a 20 current.

I'm not sure when the change was. It might have been a 10 at one point. I knew historically it was 10. It was on the 20. The moved economic development was approved by council last year. There was a proposal presented by the finance committee. The council approved the budget, but that's how it got under economic development to free up funds under for the nonprofit. That was the

Thank you. So, um, we in total got $169,000 worth of requests and, um, this year the nonp nonprofit funding program moved into, um, admin. And so, Kendall and Celeste, um, created a, um, a team to review the uh, program and make recommendations as to what the funding should be. This was

their recommendation um to finance committee and finance committee also um uh approved this as their recommendation as well. Moving to storm water um this fund is balanced at 3.7 million a 4.16% decrease from the current year amended budget. Um there is no change in rates from the FY choice. Um water sewer is uh 35.6 million. It's a 13.9% increase from the current year amended budget. And um this budget is includes uh 4% base rate and volumetric rate increases for both water and sewer. So, our average um resident is at um 5,000 gallons per month, which is a $3% impact um on the monthly.

On this point, just something I've always wondered actually as rates are different for water in particular. We share the same system. Why is that? Isn't there typically the same wondering why? Well, how are we able to charge?

You want to answer for me?

Operational cost mean whe they may have different scaling. They may have different um metering systems and we have whatever but it's it's operational cost could be salaries too salary benefits however they're whatever they're distributing across their cost. Yes, Jonathan clarify we do share facility system.

So we we do all the maintenance of our once it comes through the meter vault it's our system. Okay.

We have our own ID number water supply number. So at the vaults it's no longer carried. It's 100% Apex.

Okay. So it's not we share the same system. We share

we share the same supply. all the pipes inside of Apex belong to Apex fund. Um that is 70.6 million. This is a 10.25% increase from the FY26 amended budget. Um this includes a base rate and energy rate increase of 6.25% 25% and our average customer is uh at the 1150 mark which is um $10.26 26 cents per month and um we put our rates against Clayton Wake Forest and Duke Energy and so we're still um on that lower end than everyone else's so far. And this does not include Duke's potential 14 to 18% uh increases that they're looking at. This is just their current bills as is

and and this you may have said it.

Yeah,

this is us indexing and they the other jurisdictions not just may also have increases.

That's correct. And yes, we have um this is Clayton and Wake Forest's current year because they had not proposed at the time that this was created. So this is their current year rates and we're still

Somebody may ask why we prepare ourselves those. Those are also those

are also electricities. Yep. So um some strategic goal alignment in the utility funds. We have our downtown wershed study a pollinator education project and backflow education under width community. Um we have water quality analyzers system upgrades and call replacement under high performing government. Um UV replacement flow monitors and stream stabilization under environmental leadership. uh waterline replacement, easing

substation and uh Jenx uh substation under responsible development. And then for economic vitality, we have um electric system expansion, our VIA expansion and um some sewers. So um we met with all of you individually um over the past couple weeks since the draft had been published. And so, um, themes we heard across all of those meetings were, um, looking to lower the recommended tax rate, um, looking at additional or increased revenue opportunities, and evaluating um, expenditure reductions. So, um, over these two weeks, we've also been um, we've received um, some updated numbers for various revenues. Um, for example, our, uh, fire weight county cost share came in slightly higher than expected. Um, so we've gotten some updated numbers. We have um looked at the parks fee schedule changes and we have um uh updated those numbers accordingly. Um we've reviewed initial revenue projections as well. And then we've also reviewed departmental expenditures. One um area that came up a lot in conversations was travel training. And so, um, through all of those updates, we have been able to, um, get the recommended tax rate down to three increase. So, with a 3 cent, uh, tax rate increase, that would put us at 38.6 cents. And so this chart is updated with the three cent uh recommendation which uh is a 31.71 cent um monthly impact or $380 um per year for our average resident. And then all of the costs highlighted in gray which are many um are of the municipalities who have not officially presented. Um you'll notice most of

water sewer because a lot of people are on Raleigh's water system um are all gray. Um but without everybody's um proposals we sit right there at fourth um and we know that Raleigh and Morrisville um presented with have presented with gaps. So um this isn't final by any means but this um we're within $100 of um Raleigh and Carrie and 200 from Morrisville. So

you go back this is further down the list more expensive too

for the annual total. Yes.

Yes. Thank you.

And the numbers you have for Morrisville and Raleigh do not reflect a change. They do not reflect any change because they have not officially um um recommended a tax rate. So um those are that's their current year information.

So it's us with the impact but the others not yet. A potential we will climb.

Yeah.

On that list in a good way climb.

Yes.

Okay. That was a lot and that was quick, but hopefully paired with the one-on- ones and all the reading you all have been doing, we're good to go. We're making sense. Everybody feel good about the data that's been brought to you. Uh so I I think first we'd like to say if there are any questions on slides or data that we would go there. Uh the next piece is we'd like to go into I talk about that question. All right. So, what we'd like to do is get into two groups. They're outlined above. Blue team, the green team. No

significance to the color or why someone got somewhere. We just tried to divide people up. Uh, and we're going to get into those groups and do kind of what we did on the capital to see if we can get a consensus in that group, kind of debate through some items within each side. Uh then once each group comes to the closest they can come to consensus, we'll bring everybody back together and see how it meshes as a group and then you can discuss and advocate and do your thing after that. Does that sound good? Okay. So

blue team will be in the back corner over here and the green team will be um right by Allen there.

And each team will have administration represented there. You'll have a budget analyst with each team. We've got our leadership team in the back of the room as well. So you've got every resource that you could hopefully need is here. So if there are questions on any particular expenditure or project or whatever we can engage with our team that's here, we'll work through it and see kind of we didn't have a set time frame on this. We want to see how it evolves and how the discussions go and then we'll facilitate with any

two and a half hours.

I mean it could be really quick. Okay, we're good. We'll go to the respective teams. So, blue team is council member Mappy, blue and gray. Green team is Gilbert Zigger.

Yeah, that's right. All right, got one.

Sean,

you can join I think I open

Thank Yeah, I'm right there. Are you seeing that would be appreciate it. I would appreciate hearing

I I got Make sure they're And then ask Our Thank you. clearly see if there's that

One thing We haven't really Here we are down.

Yeah, I mean show that again. Hey, just take on a little bit of those tax right now. I just feel like we have to reach

Is this correct? 1.75 2.25 Sorry. Very clear. You decide.

Yes. Amen.

Now I think Yeah.

What are you telling me? Anybody wants We're not existent. That's okay.

Target.

Okay. You're also You're sort of The next change. How much I would like to be able to tell you

much I would say, "Oh, wow. Why are we this abstract? My life versus the facility. Have a We'll get connect. So control

office. We all sir. I'm sorry. Start again. Basics. um 10 page literally this helps because it allows us to expand um or security or whatever and then allows better expend I think this is kind of

a thing. necessarily understand. We have

we do level. People have

folks coming in. square.

I don't want too much like Elizabeth I want people. I think you don't get last two years. I must say

Okay, maybe this is similar in fact because when I hear again I'm just living my life whatever and I just fine people and I find sometimes whatever you're right offic has the clock. Let me tell you about the interceptor has to handle 20,000 miles. those kind of things. I think when people see governments chips away at those policy.

Is there a stop?

Yeah, difficulty. I was talking about yesterday. page said.

Thank you. Even

already Big stretch.

Beyond just So those are the same questions about structure. Okay. Lieutenant

So it depends on where this build is one that has all of traffic all over 30 officers. two special That means Take that one. Thanks. I think these are supervisors

and they're overseeing their on the ground taking that. So I would say that I'm really No, you're that's the reason to study anywhere you can find it says what we were doing before the modified schedu and then the fact that we're just

sit in my office. I really like questions. That's what creative looks like. External was successful by stand. I don't have sergeants. We just did wild success. These aren't people being chosen because they check box. These were the best and they happened to help us. So just at least some context in terms of depending on if you have to come to something. That's

well keep on track.

How are you? So you're Okay, this is the extra One hour radar. Yeah, the other one.

control. You mean you mean It's always excuse There's one clarific Make sure your So

you said that behavior. priorities. How much But did that property I'm sure that's an It's apparently

University. I think so. Look at this. second. Well,

Whatever. I'm sorry. I think for Jesus. Well done. All right. It was all subject. for sure.

We got to finish. You may every single We're kind of I know it's not one thing I think is easier to sell this

I remember this. I remember whatsoever. more than 70%body. website. I realizually make sense.

But if you have other things to tell you I know that's just going to be able to justify that would rather The last thing I was going to say was This right talk about some goods. I'll stop and just say I support

my line of this very much. It was based on There's other two positions. dear. Thank you.

tools. Come on. Look at me. years. Why? Sorry.

You want to go out with this?

Yeah. I think you're doing

I outside. Okay. That is corrupted. opportunity question kind It's not a dog's

looking innovation, smart cities. I'm wondering how that went back to your point about She's like

I'm curious. We're suggesting the free sad I can say

Yeah, it's on CIP. Make sure you're not The next so This is already starting Right. And

she She was a little boy this

uh Okay. But we are able to dedicate the science to go all in obvious.

There's one more. Is it all Some of this other layer. Thanks everyone. Can you talk about states So I'm using awesome

It's We've been waiting for something. Yeah, expected. Last week, Thank you.

Hey Sure. Good morning. Sorry. between questions. Honestly,

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Yeah. Menu and then um Fine.

Uhhuh. Everyone has checked Yeah.

Oh. Oh. It seems Have you tried What is that?

Yeah. Yeah. I feel like I love that I mean it was really good. It was very

location.

Yes. is not I mean it seems like it needs It's like

Yeah. Exactly. I don't want to use

figuring it out. Yeah, down the street. something smaller. outside the

Just reaching the left hand. You're Starting again. Yeah. All right. Especially in the postco. era. We may have people

Don't It's says Right. You're really welcome. Yeah, me too.

response. That's all right. beautiful. So getting soft. project. How do we help you?

Well, I mean, short So I think investments back I think that was something.

is a healthy.

Yeah. It's just interesting. Relaxing. Miss I guess what I ran. I think she said good.

You can see it. Is that what you guys Oh yeah, she's like goodness. Of course it's What did they get down to?

They got down to

Don't forget to angry.

Why didn't Yeah. our discipline.

Yes. Oh my goodness.

Yeah, I get chocolate. Right.

Right. Sister. And Halloween.

Yeah. Yeah.

to our question. Exactly. Remember, Let's go.

I hate I'm

sorry. This is my This is my So little days without% of course. of course girls So nice.

It's not

They sell us in the end by going there Sunday. It's like tonight I'd like usually Facebook um I'm trying to

think about it anyway. I want to do. That's go to that bar.

Sunday I had gone yet. Can I have service? actually something

You found outside. Oops.

All right, we're back in

We turned it back over to

All right. Hopefully everyone enjoyed the exhibit. So far, we were able I'll speak for the blue group. We got to a pretty good consensus point. There are a couple of nuances and we tried to indicate that in the boards and we could talk about that. I don't know how the green group went. Sean, you want to talk about how your green group went?

Wow.

We had we had we had good conversation on it. very complex. When you get to this point, there's a lot of complexities and a lot of nuances that require further discussion and knowing that that's a small group with a larger group. So, that's what we're coming with. Um, you know, we were able to get to kind of a general idea of we want to be in this area, we can get more, great. And so, there's a couple there's a couple specifics on those numbers and then a lot of just then here's our general priorities of what we want to make sure we maintain or what we would like the staff and management to look at and come from there. That's kind of that's where we got to

so maybe we'll go through now I'll start because I'm blue side I'll go on the

right and the way our group ended is they wanted us to ultimately put forward we talk about next steps put forward three slash4 scenarios three that are more practical than one demonstrative thing um so on the blue team we had tax rates they talked about a 1.75 they talked about a two and then talked about three where current budget is in town manager proposal. So we worked to try to get down to 1.75 and there were some very specific things and then there was discretion that was given. So how we got there first was reducing the additional penny to the seven reducing that by a quarter that got 500,000. Uh there was the additional uh push to do an additional fund balance of 500,000. So that's about a million there. Uh there were some specifics brought forward about it uh to software cuts and we consulted with our IT department and we believe we have a targeted cut we can make that area. Uh so that was 1.1 million in specific deductions and then uh there was an ad to the budget to pull a project forward that was in the SIP but uh move that design forward. It was $100,000. So the thought was that we would take that 100,000 not from the SIP funding to bring it out of the additional fund balance. So we got that as an ad here. So altogether about a million bucks on that top section which then leaves about $ 1.5 million delta to get to a 1.75 tax rate. Uh the specific guidance we got was look at our vehicle replacements. It wasn't hey take PD from 25 to 15 or 25 to 20. It was take a look at those vehicles. We'd like a reduction. We'd like our vehicles to last longer. Uh so it was just a in general look at vehicle replacements. It

smart cities again comments there of not taking all of it out of that smart city bucket but could 700,000 be 500,000 taking a look at what that would be. The next was the legislative program. There's a little bit of debate on this. There was a specific proposal put forward uh that one of the two clerk positions relates to legislative program. So, one of the proposals said cut that position as well as the other specifically the legislative one said cut that position. Then another proposal was look at the lobby contract and cut the lobby contract. So there wasn't I don't believe a consensus in our group on which of those was the better option. So we summed it up as somehow impact the legislative program financially whether it be the position or the lobby this contract. Then the last piece was looking at positions in general. There was specific guidance on like I said related to the clerk's office. There are two positions that were specifically talked about. There was not a consensus on the two our group but it was then positions at general in addition to those two look at four to six from the general fund. It was discretionary not prescribed what those would look like. So anywhere from four to eight positions would be in that area to explore. And not just cuts, but it could also be a combination of delays. We're bringing those on board where it makes sense. We always talk about if you fund something for half year, you got to next year cost. So we wouldn't want to necessarily do that, but where it makes sense. We've got a couple of ideas on positions where it might make sense where it won't naturally come online until January. So you would plan that. So this category included giving us discretion to find some of those as well. Anything did I sum it up right from our group?

Good.

Okay. Um so I'll go over this real quick and also in you saying that there's some specific points that we didn't catch up here in the cities but that definitely align with what y'all said and I'll

point those out. So I also want to say that as much as I want to do a lot of great things they didn't complicate it by adding something. So not just just this point. Um so uh again yes the group was open to a reduction in the CIF. Um they had specific projects they they knew that council as a whole would want to talk about but they were open to you know have half have opinion part of that understanding that affects the full fiveyear cip um but definitely um and they identified a few projects in there. Um we have to put those but if there's a discussion on that that they had projects on so but a half a stand that was that was a penny force. So that brought us from the three down to two and a half they had a target of at least two as this kind of a ceiling go under that was that was great more um and then the other within the other new buckets uh there was some discussion about the supervisory repeated positions if that became part of it that was potentially another course at this point we were down to 2.25 125. And so that was kind of trying to get a little bit more. Then we got the general direction uh Ry like you mentioned. Um so and that was look at some of the other new positions. So the other new positions that are in it. Um those total outside of public safety you just said. So what are those being? But it wasn't just necessary cut those are important. So in the existing positions which I think aligns with what you just said some offset right do not fund some of the existing ones and that would be up for us to kind of come back and look at um from the measure standpoint and then making sure that whether it's positions or anything else that council understands what is that what's being taken away from the budget and what the impact of that is on services and programs because that's um what they want to uh make sure they're aware of for priorities which you see the priorities up there maintaining infrastructure payments maintaining board benefits Um obviously the maintainers make sure you don't have long-term costs paying things like that. Public safety is a high priority but the commitments to public safety already made the budget were not uh been able to really that that's not for discussion at

this point on what we what we got. Um the legislative program did come up. It was I think it was very similar to your discussion. There wasn't a full agreement on it. So I'll just go into that but it did come in there as part of the positions piece. Um also on the IT smart cities there wasn't discussion about we need to know more about what what these exactly are so we can what the communication is. So um it wasn't necessarily saying this but it was an understanding of what what does this mean because there might be room for discussion uh do we keep these programs in these projects uh that's legislative align with what they said so mayor Mr. Reese Mr. segment. Did I miss anything?

Um, look at that as far as consensus.

Yeah. It wasn't I want to be clear that was just a specific it was it was just it was brought up but it wasn't necessarily hey. Yeah. So anything said I mean there's discussion about all that. I want I don't want to say that anything was said they're all like all three were this because it was it was a mix of what's there. It was just part it was open to a discussion piece and so that was that was just the number

and and then also made it clear we're not interested in saying cut this back to other thing I do want to bring up I think a scenario below the two cent showing

that's right so anything that yeah anything that anything that it was is cut or removed um from the budget making sure that because it's in existing budget that means it's going to impact something that's already being done and they want to make sure that anything that where that happened that it came back so all the council was able to evaluate and that's why we talk about priorities we don't want to be an endless cycle of this which one of the other things is it just a theme of um

where it's not complicated identifying where there's gradation or there's phases to something as opposed to binary run this fully or it's been chopped are there ways for instance what uh Sean just talked about for instance the you know wayfinding 1.6 six does that mean do we need all of that we need it all up front what you know specificity around that so that's what I think applies to a lot of there's there's one more thing that's not mentioned here is the projects that are no longer specifically listed as part of the growth like kind of stuff that's already partly completed and then I mentioned town hall renovations in particular um kind of re-evaluate the spend on some of these programs like that But are we are we generating that movement fast employees? If not, then maybe this is not a place to continue those investments and we need to look at maybe diverting those investments into like a new building, right? But the uh the fire station uh offices that we're talking about is set up continuing down the path of you know putting money into this building if we're not seeing a significant

and they mention the same.

So maybe at this point we could talk about thoughts or get specific. I see a hand over there.

No, I mean the other maybe that's good and maybe give you more direction. Okay. So, I think we all got an email from I hope for a budget direction at the end and we talked about briefly at the end of our discussion. I think it's appropriate

for you know maybe possession

and the specifics that I know you jump in. We've just been approached about potentially funding of positions for their office to ask for this year with the half of year. So to start January um the estimate that we've got is 90,000. to then pass that the annual cost will be $180ish,000. I don't have anything more to share because we haven't paid yet is next week. So I'll get details, I'll get numbers, I'll get justification from that's what I budget request

a little bit. Uh so why sent these letters of the county and uh propos to a model where the municipalities help fun uh and he gave us some data study the number of the case load per per ADA and how county is one of the most underfunded um offices in the state. And he also uh presented some some data showing how Meckburg County this the model they have there fund the offices um and this is the model that way could move to to uh back some of the the needs for sort of the genesis of it and um asks apex the animals He wants it one running. So that he ask the letter I believe would be the current implication going forward. So

I I do like to understand from chief of police like what's what the potential benefit to us would be in terms of like

lesser weight times on on case be prosecuted. uh are we seeing our officers end up in you know jail when they're trying to book somebody because of some of these positions not being right. Is there not only a cost to us but what you know how it improve our police engagement with the prosec going forward because I I do think that there's there's a gift back here that is maybe hard to quantify but um definitely should be considered. One of the things is um my understanding the possibility of a special apex pilot program um to reduce um officer weight times at the core house as well as um considerations of other priorities that Apex has when it comes to closing deficiencies. pilot program is one example of things but he'd also like to know what other things might be applicable here. I was just not familiar or not with our police officer to our chief unless he's had discussions spying outside of this. He doesn't know about this for me because I haven't met with him yet. So you're in headlights. I didn't want to surprise. So I'm certainly if he's got comments, he can make them, but I just wanted to let you all know that he doesn't know anything about it in front of us.

It had been rumored. Um that's the best. We haven't done any kind of detailed analysis based on what you're asking. Our most

fundamental issues in terms of question you just brought up is mostly that officers are showing up in court and never testify or push along. That's the most fundamental issue is the sort of staff time is basically like going down court date and then never ending up testifying. So any efficiencies there would be welcome. Finally asked would be I appreciate being involved in that process. Just think that that it would be incumbent upon us to ask for some metrics as to what is actually changing again cases more collaboration on major cases. What is the actual goal besides us providing money for you to have people?

Yeah. And then what's the baseline? Right. So even if there's no goal just yet we're here today, right? time that we do for a year year or two on this position at least a measurement of how we think that's gotten better because of those decisions.

So you'll have this conversation um on the 14th

and then you'll be reporting back tell us is and I imagine you'll have conversation I have to meet with Is there any legal concerns?

We haven't even had an opportunity to speak to the

first time hearing of it. So,

I have thoughts, but I just like to reserve them.

Okay, good on that issue. All right, so the next is kind of how you all would like to proceed. So, uh in our our group there was direction to prepare scenarios like I said at the official four. So there was the 1.75 two scenario three and then for demonstration purposes one that had a zero increase clearance. What would that

look like? So those were the four scenarios given the guidance that we have here. What I would if if we can go with what we got but there are some inconsistencies big picture wise between the two. as an example reducing the civ uh there was it's not a three 0 in our group it was a two to one and then you all also have reduced the civ there's about a double so I think you were reducing it by half a penny we reduced by a quarter if there can be some consensus on that or if you're not ready to that's fine but if there could be consensus on that that's a that's a pretty big swing of $500,000 difference um doesn't mean we won't look for different things but as we dive into operation to try to find additional dollars. Half a million is a big change of what I'm looking for. So maybe if we could have a couple discussion points. That's one. My thought is that you would be able to incorporate that swing as you prepare each one of those courses for us because I think if if there is, you know, if it to get to 175, the only way to get there is by having the 500. I think that's up to me. So that's what it's like. Here's how you get there.

So obviously in the three option it's as is.

Yeah.

The two option maybe the 500,000 would be the full million shake. No.

No. I mean I'm not comfortable with any council over the last two years here uh including most recently January work session how to invest in the community how we were trying to separate out the tax rate between capital spending and dedicate funds to that and our general operations. stuff. uh it is tough and you have to start and dedicating funds uh to this is going to savings like this stuff that's going to a bank and in future

it'll be and I just um I feel like you know at the first budget cycle where things get tough starting from it a good sign there's some pain but the idea is to the next day uh consistent capital investments so we have a a realistic schedule of what we're doing in the future. And that's what we did in January. We lined it up. We agreed in January to a 1 cent increase related to our capital investment. We have a fiveear schedule now for the first time since I've been here. That's actually realistic based on that capital investment. That's why I don't do this in different things. Um what I would like to see is that pull all the capital investments out of general fund political through plan and adjust the CIF funding according because we basically set seven cents aside for the stuff that we're presenting as capital planning improvements but then there's capital invest investments that are hiding kind in the general like so it's to me it's not an entirely complete picture and so I would like to see it's a view where that all kind of pummeled together the seven cents goes to 10 11 12 cents like whatever that that is um and so I think what we're talking about here is is really the the extra penny that we said in January we're going to has now we're saying okay we're going to pull back on that a little bit and that's going to obviously impact what we depend on in the next couple years um and I'm willing to consider that I think we should consider that and then you know the choice becomes ours to say okay the projects that we need to set aside right how important are these for

our community in the next five years right or can some of these bec increase the purge while we still maintain the principle of spending money for long term investment. So I um I don't like this but I think it's you know if that's what it takes to get to a five or two scenario then I think you know realistically Yeah, actually um I think that uh the quarter of one of one cent is good. We um took two projects away from that um our safe environment uh investment and those two are not urgent and I think we can afford to do it right now but I don't agree we take any further like um Terry said we need to see London picture to pro provide service and poly polyide you know a better life for our residents. So we need those projects.

And so can I ask what's what project you guys off the table because we haven't really compared those.

Um one is the solar you know the unwar decide to wait not this time. Another one is um where's the other one?

Yeah.

Yes. This south. Yeah, the Ply southwest uh winding. Yeah.

So, we had some debate and wasn't full agreement

finding the way finding in favor of it. Um to bring more tourists into into our downtown area in particular. Um but it was also some agreement that maybe that's it doesn't need to be only in one space, right? is half, right? It still means an objective, right? But maybe not. I just want to clarify people listening like we're talking about this year's project. We're talking about five years, right? Five year capital plan. So these projects that we're all talking about were not scheduled done this year anyway. They were talking about them from our five years, which means it would be more than five years out. in future and also the numbers are different. So a penny in our tax rate would save us $2 million this year rather be$2 million less dollars on budget. Uh but when you're talking about the sift and the capital investments penny uh my understanding in our debt model and and the way this all works penny is about $24 million worth of investments. So if you want to cut a penny out of our contributing to our CI we have to cut $24 million of projects um which is hard you know we've already cut this that that was our size January we get down this list

so the scenarios you're right the the 500,000 translated about $6 million projects that council member mentioned

so then for the green team your million to about $12 million into day one.

Yeah. So, um this was just to level set on what happened in January. There wasn't an option to do, you know, zero pennies, half a penny, three quarter of a penny, penny. It was just t

and it was a great exercise. Um there are concerns just around Okay, let me flip it back to your point and I don't think anybody wants to cut, right? We want to do all these projects um at minimal cost. a theme of at least what I was discussing this the use case and like my grandp used to say I was mentioning here and so what can we do if we're able to justify this penny and it again probability nobody knows what's going to happen tomorrow or a year or 10 years from now however we're looking at probabilities of like hey going ahead and investing in this now is an efficiency for the future you know in year two or year three those are benefit But what we initially started looking at and so you're right if if we're pulling out the southwest connector I thought there was more than just a reconsideration could be wrong maybe you go what we did on

yeah differences there's there's tiers I was say most of the consens or I think the consensus is unfair appropriately um as it cascades down the next

I mean the blue team took took the southwest connector and solar. We took southwest connector and

and um and wave or at least reduction.

So we should come out around the same. So I'm a little bit confused why one team comes out and let's with half penny or a quart penny.

Yeah.

And we come in with half penny.

So that's to

I think we need to reook at this here. Um I will echo council member's point that already we are trying to set ourselves up for

having a basically a war chest you know for these larger investments that that you know we're from now and in the future and part of that is big maintenance projects you know to protect our thinking about services part of that is that new services that that we'd like to to the community. And by doing it the way that we're doing it, it um it kind of prevented seessawing of expenses year after year, right? Because we're we're building up this this this fund for debt services that we know through our debt model gives us a pretty steady state money every single that concept is great. uh also need it. And so my preference would be that we look at operational expense first, right? Because the three increase kind of assumes that everything underneath all of that is is good, right? And so I'd like to double up on that a little bit more. Okay, like what do we need to take out in terms of operation expenses or you know some of the growth in other areas before we start touching using other but it's not so big there that I'd like to protect as much as possible but I also want to be realistic if there's no way of getting to 1.75 zero right without touching that step you know it's It's a scenario.

Yeah,

maybe I maybe I should back up on um is there is there a consensus yet on the tax rate or you guys are good with three options? Did our group came up with

three? Was everybody good with three options? We've talked about three as well. We talked about 1.75 two and two and a quarter. Uh I two and a quarter seems you know a little bit too rich for my blood to be honest. So I love the idea of putting a zero in there and I don't want to you know have that if there are 16 different scenarios either. So if we want to stick to I'm okay with zero.

Yeah my 2.25 25 based on the the case of efficiency. Spending the additional quarter penny now sets us up better for at least as far as we can see, you know, visibility of next year. But yes, the what I was hoping was the 1.75, the two and the 2.25 with the two and and I think the 1.75 was also show us what we're losing. I think that's for every scenario on those three something

is there is there interest at the 2.25 point I just want to see anticipation of not just quarter to quarter not just feel sometimes shortterm.

I mean, be clear, these three courses of action that you're going to be presenting to us are going to have a lot of nuances, a lot of variations, and a lot of there's going to be variations within those once we get what's behind the numbers on those. There may be room to say, "All right, you know, we went from 175 to three, maybe two5 is the is the magic number, but what you're providing to us are courses of action so that we can be able to have

the tangible conversation and say here's what we're losing, here's what we're gaining, here's what we know it's completely off the table." That's why I think SeaWorld option is is is is asked for because I think there is a you know there is a very real sentiment within our community that there should be a 0% increase based upon what they're seeing as being offered in other communities. But I think it's also very realistic to have a full understanding of what that really means. And I think our recognition of hey here's the true impact um within our site picture for consideration makes a difference.

So zero 1.75 and two would be the three in addition to the option you already have up for you which is the three.

I also point out years like listed what cuts each one we sort of swap between them like you know we want to do this right here we actually like this cut down here we don't like this one. So swap those two. So that kind of the the options don't necessarily have to be taken away for us. We can look at the list and presumably the cut list maybe get something.

Okay. And then sorry going back to sip. I heard no cut to sip. I heard use it as last resort. I think um two cents um give us um a little bit room right um flex and flexibility because um when we were talking about 1.75 of course I love you know the lower the better right but um we are you know looking into cut our police um cars and equipments you know I mean the the police department think it's really necessary to add.

So I I think it's better safe than sorry when a police car actually reaches uh 90,000 you know mileage we should replace them. If we you know change it to maintenance make it you know uh 120,000 for example. I don't feel comfortable you know u because you never know the scenario when that you know uh when one police car you know reached like 100 of them and suddenly got you know um problem when the police when when our officers is using it chasing the criminals right I don't feel com comfortable put our police officers life in danger I think she's saying you can touch

can the last resort

I I think you should be able to touch the

I mean when we do the I know what our intentions were when we did this exercise in January also know that we've got a different site picture now today and also when we did the exercise in January we did start talking about how much our base was going to be we know what we're kind of looking at today I don't think that when it comes to this sort of examination we should not look at the scenario based upon the present day information we have before Back in January, we didn't know the general assembly was thinking about taking away our ability to even have these conversations. We have that today. So, I think we've got to have a realistic view. Don't don't get wrong. I like the idea of not touching it. I think it's great. I think we have the right intention on

scenarios change, circumstances have changed, the environment has changed. Do we want to thoroughly move forward? So I think impacted but messages as possible. Okay, next big one. Ad fun balance that came out of our roof but wasn't on your side. I want to make sure we're solid on that recommendation knowing the implications. It's more than what we were originally comfortable with.

Right.

Yeah. If we if we um are decreasing the tax rate, some of the items that are eligible for fund balance like replacement police vehicles, right, that have a revenue source with the increased uh property tax, um we could utilize for some additional fun balance and still be even there.

So everybody good with that suggestion? Okay.

We've got our policies, right? And so as long as you state it in our our policies, then okay pulling a little bit more reserves as as needed. Um but it's also don't think that this is a pretty long fire that we need to go 25% right 25% and I think that even with the draw on the fund bump as proposed we were still staying 25%. Um no once once you take into consideration because the fund balance that presented that is as of year end last year right so since then we did 3.8 million with the new budget and we've done 1.2 million more in budget amendments and you add in what we're thinking at year end plus the what we're initially recommending that this would give us um leave us about $600,000 um above our 20% policy. We'll go down to the the bottom.

I think we have an obligation like this is this is not savings or uh project so much. source funds but this is tax property taxes that actually I think we have a policy range you should at least policy uh level and um the other thing to think about is that this specific we split up the capital fund balance into the capital investment fund the fund balance we used to calculate it several years ago so if you add them back together our percent fund balance is like massive it's like you know It's probably 35% time or should be a range. But like the point is the money in the SIP no longer counts to our fund balance and it used to. So that's why 20% today is a lot different than 20% four years ago because four years ago our fund balance also held the capital investments.

My intent is to actually put more money and not Yes. I want to do more of that because there's still capitalist managers in the general. I think one is the Sith. Thank you. Um and the police cars that you mentioned is good.

So street good conversation.

Okay, next one. Just hit it real quick. Um I software and adding core banks. Those are pretty much the dollar amounts interchangeable. Expressed a a level of not complete discomfort. She didn't say it would be easy and we're giving something up.

So there's a software reduction we can make and add it to banks. Any objections to that concept?

Okay. Um so just where where would the 100,000 come from? Would that come out of the 750 or about separate like more operational?

Okay.

Um okay. So those were the identified cuts. Anything else you want to give specific direction on? Round numbers and I know you may not be there but fund balance 500,000 CIF potential maybe 500,000. Um, so the gap we were at three and if you go to two that is two million bucks. So there's potentially a million there. So yeah, it's two two and a half and six million for the options. So 2 million if we go down to two, 2.5 if we go to 1.75 and six million if we're zero tax increase. Um, so the six million we'll we'll figure that out. some other stuff. The 2 million and 2.5 we've got clear direction on about a millionish and then the rest will be operational. Is there anything that you want to give direction on or you're good? Okay. All right. So then next steps, how would you like this to come back? We've got a couple of different options. We are set for potential adoption on the 28th which is our public hearing this month. Um we had on the budget calendar a work session for June 2nd. I think we had one and then I also believe I saw on the calendar maybe it's a hold potential on the 21st of this month. So you could say hey we want you to do this bring the options back on the 21st. We want you to do this. bring the options back on the 28th or some other combination.

I think that's when bringing it back on the 21st because we do get to the exercise where we're like you like we

like your cutting of this but we don't like your cutting on this swap course of action and gives us at least that conversation discussed.

Um so real quick I just want to speak to timing some timing and logistics issues. So um we can accommodate some of we can accommodate some of those meetings but we'll have to understand that the public hearing if the public hearing is still 28 we need to not we need to notice that public hearing 14 days into advance. So that is next Thursday that has to be noticed. Now we can notice the budget as is and then you just understand you're you're going to have these workshops which is fine. the everything that you're working off is still going to be the one that's already been presented and then you're you're likely not going to adopt major meeting. It's gonna have to be after that because you're going to need to talk about all those other changes at that point. Then you're obviously have a community input as well and so then a final would actually be changed. So that would just understand that you know or if there's direction for you want whatever one you want to have a different starting point that staff can make an adjustment to and that can be what's posted as the public hearing document next Thursday as well but that's important time with staff we can do it don't recommend the please don't recommend the zero one for that because that will happen before then just

like they just can't we won't have time to do that um but anyway I just want to point out the logistics of that have an understanding that next Thursday we've got opposed to this budget's already out there, but the one that we officially know since the public hearing has to be done by.

So, could we make changes to the public hearing post document? Any minor ones or we have to repost it?

The dollar amounts can't change.

Um the dollar amounts they can't well they can change, but they can't they won't officially change until you have the public care. like you can get direction and everything as we go, but the one that's going to be discussed at the May 28th, anything you discuss at May 21st is going to have to come back.

You're going to have the same discussion on May 28th because if you're making change, if you're making changes to that budget, just this point numbers, the numbers can't really change. You can change the numbers at the public hearing, but the the document that the public is speaking on is whatever one is first with the hearing. So you could present it

with influence by the 21st say hey we all met on the 21st at the 28th meeting this is what you changed the public would then receive those but they would have reviewed it based on the full version I would just say recommendations rule you need to rule out the 20 potential adoption just I don't think you're giving satisfactory public notice and discussion if if you know if you go this with that. So that piece that we make sure you have that to make sure there's time to say okay here's the changes that gets discussed at that meeting first meeting in June

the 9th night which we're still comfortable I mean it's fine we don't want to go to the next 28

No you don't have to have

you have one like on the 28th where we would have already noticed the 9th as public hearing Then so we'll have the 21st we would we still we're trying to get we still notice the 28th is a public hearing any changes you make as a result of hearing you're going to have to have the public oh I see yeah we I'm going through the control act just what you have to do so any once you have the public hearing if you any changes that you decide technically you could that night that there's changes directed in place but you want to make sure but you want to make sure you're discussing the budget that that the that the public was nervous as we see at that

I knowing what we know it seems the whole disingenous post the budget as

notice that right now and then really have a different conversation I think my out of here right if he notices for tonight that gives us the 21st to do another session and kind of get to a pencil down situation known as the you the actual plan that we're going to be discussing in the so that would be another the next option I was going to bring up is you could potentially push the public hearing itself through the night to get the different budget in. Um the two scenarios that kind of play out on that is there could be the expectation that we've worked on this we've had the work session first the 9th is the public hearing barring anything absolutely crazy you would also adopt that because the other scenario is

depending on what kind of feedback you get on the 9th and where we go push you to the next meeting and now we're at the June and starts it's getting a little close for us from the staff so just keeping in mind those two things if you do but you can to your June 9th could be a public hearing. Um then it's up to council you expect to adopt that when you start close for us instead. So I think that sounds good to me. I think like right now we're talking about three scenarios in the 21st try to narrow it down to one scenario. We decide which one it is and then we notice a budget based on that one scenario. And then on the 28th and the 9th, we maybe tweet this amount this time in keep it sort of the same but sort of like narrowing in here. Like tonight we we have some suggestions scenarios. We'll try to you know firm it up more on the 21st and notice the budget based on that the 9th. And um you know I imagine from the 21st maybe some more feedback you could sort of get in terms of

forming that budget for the 9th and you take a look at it between then the n or moves that generally keep in the same direction that either push it again or if it's if it's simple enough like say this 100 grand this still directionally being

so work session the 21st then we might have something on the 28th we might not depending on 21st

will be a public hearing discussion items something and we would for adoption on the 9th we'll advertise that 14 days ahead

yeah the 26

but we we decide on the 21st broadly or less broadly pretty narrow and then still modifications tweaking by the latest Friday the 26. So just throwing that out there as well because we had kind of talked about the other timeline.

I think a council is committed to the 21st saying here's the scenario that we pick at least total numbers.

You know there could still be some play accept those numbers because we advertise you know overall number um on the 21st. Okay. 21st calendar. All right.

Yeah.

It's it's just we have a budget to review and you all got a little bit of work to do. We've got a time schedule on our As soon as he's done it,