City Council Special Meeting · Monday, August 13, 2018 · City Council Digest

2. FINANCIAL RETREAT

Financial Performance [50 min.]

Current Debt Review [10 min.]

Long-Term Financial Model [90 min.]

Financial Indicators [20 min.]

Current Revenue Sources [10 min.]

3589 segments .txt ↗

0:15 ↗ good evening and welcome to the Monday

0:19 ↗ August 13th City Council's special

0:22 ↗ meeting and we're going to meet hot this

0:25 ↗ is purpose of this meeting is told a

0:27 ↗ financial retreat we're discussing

0:29 ↗ financial performance current debt

0:31 ↗ review long term finance model financial

0:34 ↗ indicators and current revenue sources

0:36 ↗ so with that we'll get started

0:41 ↗ Thank You council president Mart's

0:44 ↗ welcome everyone tonight it's in a

0:47 ↗ nutshell everything financial and so

0:49 ↗ this is sometimes for finance

0:53 ↗ departments this is our most exciting

0:55 ↗ time is when we can have the

0:57 ↗ conversation and go through information

0:59 ↗ number by number I'm just kidding so

1:03 ↗ we're going to be talking tonight about

1:05 ↗ a number of different pieces of

1:07 ↗ financial information we've provided the

1:10 ↗ 2017 year-end report we've also have a

1:14 ↗ 2018 mid-year report due to some

1:17 ↗ staffing transition we would typically

1:19 ↗ have a quarterly report to the council

1:21 ↗ to give you financial performance

1:23 ↗ however tonight we're going to be

1:25 ↗ talking about that mid-year or some

1:27 ↗ often refer to it as second quarter of

1:29 ↗ the year so we're doing this in

1:33 ↗ anticipation of our budget development

1:35 ↗ cycle for 2019 this is to give a

1:39 ↗ perspective on where we've been how

1:41 ↗ we've performed and also to talk about

1:45 ↗ some planning going forward you'll note

1:48 ↗ in the information that the key section

1:51 ↗ of the book is the financial model this

1:53 ↗ is an item that the ad hoc long-range

1:56 ↗ financial committee has been working on

1:58 ↗ and as directed by the City Council

2:02 ↗ looking at ways to help with our

2:05 ↗ financial stability as the council

2:07 ↗ addresses transportation issues in the

2:09 ↗ community so with that there are

2:13 ↗ certainly projects that are identified

2:15 ↗ in the 2018 2022 capital improvement

2:20 ↗ plan

2:21 ↗ that document is not included in here it

2:23 ↗ is a separate resource that's available

2:24 ↗ for the community as well as a council

2:28 ↗ on our city website so with that we're

2:32 ↗ going to be talking about a number of

2:34 ↗ topics in my cover memo I alluded to

2:37 ↗ what those agenda items would be and so

2:42 ↗ that is financial review of the how we

2:44 ↗ have performed retrospective reports

2:47 ↗ we'll talk about where our existing debt

2:49 ↗ is just so that everyone can gain an

2:52 ↗ understanding of what it looks like talk

2:54 ↗ about the financial model and the

2:56 ↗ assumptions that were used as well as

2:58 ↗ some example scenarios that were

3:01 ↗ discussed by the ad hoc committee and

3:03 ↗ then we'll review some indicator

3:05 ↗ information this is a tool that was

3:06 ↗ created last year to help us pave the

3:09 ↗ way with understanding what warning

3:11 ↗ trends we might want to be monitoring

3:13 ↗ these indicators are not are not in it

3:17 ↗ in their entirety all the indicators

3:19 ↗ that a community might look at but we're

3:22 ↗ starting with trying to understand how

3:24 ↗ our financial condition might change

3:27 ↗ should the council make a decision and

3:29 ↗ then we'll be talking about funding

3:31 ↗ sources both existing as well as there

3:34 ↗ are some new source opportunities it's

3:36 ↗ not intended as you can see the time

3:38 ↗ allotted to funding sources or revenue

3:41 ↗ sources because this is something that

3:44 ↗ as part of our budget development we'll

3:47 ↗ continue to have discussions on

3:50 ↗ alternative revenue sources and then of

3:53 ↗ course other major projects that are not

3:55 ↗ included in the CIP so with that I

3:59 ↗ wanted to start on some financial

4:02 ↗ performance so I wanted to go into the

4:06 ↗ information and take a look at 2017 this

4:10 ↗ year-end report this does start on what

4:14 ↗ I think you have in your packet as page

4:16 ↗ 1 but is the 2017 year and report budget

4:19 ↗ versus actual so overall the general

4:26 ↗ fund

4:28 ↗ pretty robust ending fund reserves tax

4:32 ↗ revenues were strong in 2017 our

4:36 ↗ development revenue we saw increases and

4:39 ↗ we had general fund expenditures come in

4:41 ↗ 5% below

4:42 ↗ the budgeted amounts that were

4:44 ↗ authorized by the City Council our

4:46 ↗ utility operating our utility enterprise

4:50 ↗ funds are very strong as well in good

4:53 ↗ financial shape the one thing I did want

4:56 ↗ to note is that these are reports budget

4:59 ↗ versus actual these are different from

5:01 ↗ the formal audit of our financial

5:03 ↗ statements the finance department is

5:05 ↗ anticipating the state auditor's office

5:07 ↗ will be with us on-site for the audit

5:09 ↗ fieldwork in September and they will be

5:12 ↗ formalizing then those financial

5:14 ↗ statements and the council will be

5:15 ↗ invited to those sessions as well to to

5:19 ↗ see financial statements from a

5:20 ↗ different view but I wanted to talk

5:24 ↗ about with some highlights with regards

5:26 ↗ to revenue expenditures and our fund

5:28 ↗ balance the primary revenue sources in

5:31 ↗ the general fund are taxes and what we

5:33 ↗ call charges for goods or services so

5:35 ↗ these are other fees that that we charge

5:38 ↗ other entities residents and customers

5:43 ↗ these sources are about 82% of the

5:47 ↗ general fund and we had revenues for

5:52 ↗ 2017 exceed our our 2017 target of

5:58 ↗ revenue the final revenue budget was set

6:01 ↗ at almost 47 million we received 109

6:05 ↗ percent of that or about 51 million in

6:07 ↗ revenue sources the reason that we or I

6:15 ↗ should back up a little bit about the

6:17 ↗ revenue targets in 2017 the council did

6:21 ↗ authorize some amendments and those

6:22 ↗ amendments from the starting original

6:24 ↗ budget in 2017 ended about four point 1

6:29 ↗ million dollars upwards primarily due to

6:32 ↗ the fund accounting shifts that that we

6:34 ↗ did in 2017

6:36 ↗ one of the biggest reasons for some of

6:38 ↗ the what we call the fund accounting

6:40 ↗ cleanup was because we shifted sales tax

6:42 ↗ into the general fund and then the

6:45 ↗ council through their budget decides

6:48 ↗ where that money goes so instead of

6:50 ↗ splitting it up and being confusing we

6:53 ↗ wanted to show specifically all sales

6:56 ↗ tax in one place and then you decide

6:58 ↗ what to do with it into other funds the

7:02 ↗ sales tax was very it's the largest

7:04 ↗ source of revenue for the general fund

7:07 ↗ we received about fourteen point seven

7:10 ↗ million dollars and we were around

7:12 ↗ ninety nine percent of our estimated

7:14 ↗ receipts we collected all of these

7:18 ↗ retail sales tax along with all of the

7:21 ↗ different types of sales tax the primary

7:23 ↗ or the or the large part of our sales

7:26 ↗ tax comes from retail sales we also have

7:29 ↗ a strong showing of construction sales

7:32 ↗ tax as well and that came in at 17% this

7:36 ↗ is because construction is and continues

7:38 ↗ to be strong in Issaquah we also have

7:42 ↗ another type of sales tax just wanted to

7:45 ↗ point that out in the information we

7:47 ↗ don't take a deep dive into the details

7:49 ↗ about sales tax but our accommodation

7:51 ↗ and food services tax has seen an

7:54 ↗ increase increase and this was a 7%

7:57 ↗ increase in 2017 over the same period in

8:01 ↗ 2016 so that is something that that we

8:05 ↗ have data on other category of revenues

8:10 ↗ for the general fund is the property tax

8:12 ↗ this is another large source a hundred

8:15 ↗ percent of our tax estimates were

8:18 ↗ collected comes through King County very

8:21 ↗ strong source of funds very stable

8:24 ↗ utility taxes are also a large source

8:27 ↗ for the general fund about 19% of all

8:30 ↗ sources that we received and these come

8:32 ↗ from our collecting of tax on sales of

8:38 ↗ electricity natural gas solid waste

8:41 ↗ water telephone cable television all

8:44 ↗ within the city limits

8:46 ↗ so in 2007

8:48 ↗ we collected about 4.5 million dollars

8:50 ↗ and that was about a hundred and one

8:52 ↗ percent of the the budget targets so

8:55 ↗ we're very pleased to see that our

8:57 ↗ targets were that that were getting

9:01 ↗ close to what we're forecasting via no

9:04 ↗ attacks is business and occupation taxes

9:06 ↗ on the business activity in Issaquah if

9:10 ↗ the council will recall that there was

9:12 ↗ an increase in sales or the excuse me

9:16 ↗ the be no tax rates we do have another

9:19 ↗ full year of you know taxes coming into

9:23 ↗ the city this comes from about three

9:28 ↗ thousand eight hundred ninety five

9:30 ↗ businesses who filed in 2017 keep that

9:34 ↗ in mind that we we do have over 6100

9:38 ↗ licensed businesses but not all have to

9:41 ↗ pay B&O tax we had year-end receipts of

9:45 ↗ over five million dollars and this was a

9:47 ↗ hundred and eight percent of our budget

9:50 ↗ forecast again shows a full year of

9:53 ↗ those increased rates adopted back in

9:55 ↗ 2015 this is a another strong stable

10:00 ↗ showing of our business climate and I

10:06 ↗ wanted to talk a little bit about

10:07 ↗ development fees these include building

10:10 ↗ permit fees engineering services plan

10:12 ↗ review inspection services we had a

10:16 ↗ sharp decline in development activity in

10:18 ↗ 2016 so 2017 development related revenue

10:23 ↗ surged in 2017 a hundred and eighty five

10:27 ↗ percent of the revenue target and this

10:30 ↗ primary reason was because of the

10:32 ↗ conservative estimate at the time of

10:33 ↗ budget because we were within or

10:38 ↗ involved in the moratorium in place and

10:41 ↗ so we wanted to be conservative on that

10:44 ↗ budget target however we did have

10:46 ↗ projects that still move forward one of

10:48 ↗ those was the Gateway Apartments their

10:52 ↗ sources of revenue and these are these

10:55 ↗ fall into that category of charges for

10:56 ↗ good and goods and services is

10:58 ↗ recreation fees

11:00 ↗ very positive showing right on target

11:03 ↗ with our 2017 projections of about 2.2

11:07 ↗ million dollars then we go into our

11:09 ↗ public safety fees so these are for jail

11:11 ↗ services and we received about 1.5

11:17 ↗ million dollars received of the 1.9

11:21 ↗ million dollar target this coming in

11:25 ↗ under the revenue target was primarily

11:28 ↗ because of the number of guaranteed beds

11:32 ↗ being reserved by local jurisdictions

11:34 ↗ then we have our final revenue source of

11:39 ↗ fines and forfeitures of about 220,000

11:43 ↗ this came in way over target this is a

11:46 ↗ this is different cult one to predict is

11:48 ↗ fines in fees because you don't know

11:50 ↗ when someone's not going to comply with

11:53 ↗ law so this is just one that I wanted to

11:57 ↗ show and also comment on difficult to

12:00 ↗ predict on the expenditure side then

12:04 ↗ again the general fund expenditures in

12:07 ↗ 2017 were under budget

12:09 ↗ the general fund includes levels of

12:12 ↗ service for police and fire protection

12:15 ↗ planning community development economic

12:18 ↗ development Parks and Recreation and

12:20 ↗ general government administrative and

12:21 ↗ financial services all that comes from

12:23 ↗ the general fund yes sorry before you

12:25 ↗ get too far into that can I ask a

12:26 ↗ question around revenues and I'm

12:28 ↗ actually sort of looking ahead at page

12:30 ↗ four but you know as I look at major

12:34 ↗ outliers you talked about building

12:37 ↗ permits and I'm so much I completely

12:39 ↗ understand so we were at two hundred

12:41 ↗ ninety six percent of projected and that

12:45 ↗ was with a moratorium for the whole year

12:47 ↗ so how did how did that how did we get

12:52 ↗ there you talked a little bit about a

12:55 ↗ couple of things that were ongoing

12:56 ↗ through the moratorium but I guess how

12:58 ↗ do we make sure in 2018 that we get a

13:03 ↗ more accurate number because he had a

13:04 ↗ total two and a half million bucks total

13:05 ↗ which is the largest share of the sort

13:08 ↗ of difference from what was projected

13:15 ↗ so for 28 for 2017 or I should I should

13:19 ↗ back up development fees are one of the

13:21 ↗ one of those also somewhat difficult to

13:27 ↗ predict and with a moratorium in place

13:32 ↗ because we wanted to be conservative

13:34 ↗ because it means something at the at the

13:36 ↗ end of the day or the end of the year

13:38 ↗ and and the the purpose for the low

13:43 ↗ estimate was was to do just that however

13:46 ↗ there were projects that were in the

13:48 ↗ pipeline that we were aware of and we

13:51 ↗ were monitoring that would continue to

13:54 ↗ move forward and sometimes projects move

13:58 ↗ faster than you anticipate and so

14:00 ↗ keeping up with that that budget target

14:03 ↗ it starts to smooth itself out and in

14:05 ↗ 2018 we go through this the same effort

14:07 ↗ of looking at what's in the pipeline

14:09 ↗ what do we expect is is going to happen

14:12 ↗ and in what year and so 18 is set and we

14:18 ↗ all we set revenue targets higher

14:19 ↗ because you know we improved our tools

14:23 ↗ for forecasting those projects but

14:25 ↗ nonetheless we still have new that

14:27 ↗ projects were in the pipeline so as we

14:28 ↗ continued as we start to look at 2019

14:30 ↗ we're doing the same thing is

14:32 ↗ understanding again what do we

14:35 ↗ anticipate coming forward and again that

14:38 ↗ the difficulty of that is is things

14:42 ↗ happen or things get delayed or they or

14:44 ↗ they move a bit faster so it's it's one

14:47 ↗ of those things eventually we start to

14:48 ↗ smooth out and and what we do when we go

14:53 ↗ into forecasting we don't necessarily

14:54 ↗ assume project by project specific but

14:57 ↗ whenever we start to take revenues and

14:59 ↗ increase those based on the general

15:02 ↗ economic inflator so if if that answered

15:06 ↗ your question about us our ISM I was

15:10 ↗ monitoring that but things in the

15:12 ↗ pipeline are difficult to predict where

15:14 ↗ they're going to land revenue wise got

15:16 ↗ it

15:17 ↗ a related question is the other large

15:20 ↗ but the other large differences in

15:22 ↗ miscellaneous revenue was that the

15:24 ↗ changing of accounting and where we put

15:26 ↗ things versus other funds or was that a

15:28 ↗ real unexpected windfall may have been

15:32 ↗ this is that's something that we can add

15:34 ↗ into the parking lot to get to answer

15:37 ↗ some questions and provide that to the

15:39 ↗ council we did have in 2017 some land

15:43 ↗ purchases or that had been anticipated

15:45 ↗ or not and so that's something that we

15:48 ↗ can certainly you know get provided the

15:51 ↗ deep drill down into and to make sure

15:55 ↗ that we're understanding what exactly

15:56 ↗ happened but fund accounting was quite a

15:59 ↗ factor in 2017 to get things planned in

16:03 ↗ the right place

16:03 ↗ and accounted for in the right place

16:05 ↗ because here's why I ask these questions

16:07 ↗ that sort of the overall point is that I

16:10 ↗ mean how wonderful that we brought in

16:12 ↗ more money than we thought were going to

16:14 ↗ and we spent less than we thought and I

16:16 ↗ wish that my budgets from my personal

16:17 ↗ finances worked that well they don't but

16:20 ↗ what that does is it drives up our

16:22 ↗ ending fund balance right and then when

16:25 ↗ we go to correct that by spending money

16:27 ↗ and this isn't this isn't a problem per

16:30 ↗ se but we've seen recently in the

16:32 ↗ community confusion about as we go to

16:35 ↗ balance our various funds and keep our

16:37 ↗ funds at at the right levels you know

16:40 ↗ that can feel that can get confusing to

16:43 ↗ the public right so in a you know in a

16:45 ↗ perfect world you know we would bring in

16:49 ↗ what we think we're gonna bring in and

16:50 ↗ we'd spend what we think we're gonna

16:51 ↗ spend and those and that ending fund

16:52 ↗ balance I mean again it's a wonderful

16:54 ↗ problem to have oh no we have too much

16:56 ↗ money at the end of the year but you

16:58 ↗ know at the same time we I think you get

17:01 ↗ my point

17:02 ↗ so the extent to which as we get into

17:04 ↗ budget season for next year I mean I

17:05 ↗ think historically we almost always are

17:09 ↗ cautious in our budgets and so we end up

17:11 ↗ spending less than we thought we were

17:13 ↗ going to and make more than we thought

17:15 ↗ we were going to but I I want to

17:17 ↗ understand going forward how that

17:19 ↗ relates these conversations about our

17:21 ↗ ending fund balance and making sure the

17:22 ↗ community understands that when we you

17:25 ↗ know we're not running deficits if we

17:27 ↗ you know correct acrost our funds

17:29 ↗ and and bring you know bringing our

17:32 ↗ numbers in line with our long-term

17:33 ↗ financial policy so they sent to achieve

17:35 ↗ you talked about that further as we get

17:37 ↗ into budget season would be helpful

17:38 ↗ absolutely and you just alluded to the

17:42 ↗ how you tackle fund balance when your

17:45 ↗ reserves are over your target and

17:47 ↗ reserves when they're under the target

17:49 ↗ and so in your financial policy and

17:51 ↗ that's something that the council

17:52 ↗ addressed was updating financial policy

17:56 ↗ to be very clear on the the reserve

17:59 ↗ target moved last year from that 8% to a

18:02 ↗ range of 15 to 20 percent policy also

18:06 ↗ was very very clear in those sections of

18:08 ↗ it that said when the council has more

18:11 ↗ revenues and or more reserves and they

18:14 ↗ they they want to have in the in their

18:18 ↗ butt fund balance then that's where the

18:21 ↗ council has to have discussions about

18:22 ↗ how to spend that money that can be done

18:25 ↗ at the budget development time same

18:28 ↗ thing or it can be done throughout the

18:30 ↗ year knowing where you're at if there is

18:33 ↗ something that like building permit fees

18:37 ↗ that came in way over that's something

18:39 ↗ that the administration can start to

18:42 ↗ work on to say okay now we have this as

18:44 ↗ part of your your budget amendment

18:46 ↗ process is to say let's amend the budget

18:48 ↗ and then let's use it for something same

18:51 ↗ thing in the budget development where a

18:53 ↗ council would maybe be under their

18:55 ↗ revenue there reserve target is where

18:57 ↗ you would in your in your budget then

18:59 ↗ want to correct that bring it up and so

19:02 ↗ something may not get done in the year

19:04 ↗ because you are just going to leave more

19:07 ↗ in your ending fund balance to meet your

19:10 ↗ financial policies so we will continue

19:12 ↗ as we work on the 2019 budget is to

19:16 ↗ address the fund balance issue we will

19:19 ↗ be talking about that some tonight when

19:22 ↗ we talk about the financial model and

19:24 ↗ the the assumptions and a pathway

19:27 ↗ forward for tackling the transportation

19:29 ↗ issue great thanks

19:34 ↗ we can keep going I will thank you

19:37 ↗ let's see expenditures just want to give

19:39 ↗ a brief overview about spending

19:41 ↗ appropriation the requirements that the

19:43 ↗ City Council authorizes during the

19:46 ↗ budget development cycle are typically

19:48 ↗ for these major categories their salary

19:51 ↗ and benefits just like a business we

19:53 ↗ have operating supplies we have cost

19:56 ↗ allocations and that's one fun charging

19:58 ↗ another fund for some service and then

20:01 ↗ we have professional services we have

20:04 ↗ capital outlay and I just wanted to just

20:06 ↗ make a quick note the capital outlay it

20:08 ↗ can be different while it's still a

20:09 ↗ capital purchase there's a difference

20:11 ↗ between capital outlay and capital

20:13 ↗ projects and it's all because of a

20:15 ↗ threshold number that policy states and

20:18 ↗ then we have transfers from one fund to

20:21 ↗ another primarily for capital projects

20:23 ↗ or debt service obligations so in the

20:26 ↗ information I'm not going to go through

20:28 ↗ department detail which starts on page

20:32 ↗ six but I just want to generally comment

20:34 ↗ about 2017 and our expenditures we had

20:40 ↗ expenditures at about 95 percent of the

20:44 ↗ 2017 budget of 52 million dollars we

20:47 ↗ came in about 49 almost fifty thousand

20:50 ↗ spent the expenditure allocations were

20:53 ↗ amended from the original budget up

20:55 ↗ about 5.2 million and this was primarily

20:59 ↗ due to again the fund accounting cleanup

21:01 ↗ of transactions that we added because we

21:04 ↗ we put all the revenue in the general

21:06 ↗ fund for sales tax but we also added in

21:09 ↗ a transfer out for debt service so it's

21:11 ↗ clear that all of that limited general

21:17 ↗ obligation bonds that payment comes

21:20 ↗ directly from the general fund we also

21:22 ↗ had some budget amendments in 2017 that

21:27 ↗ were connected to expenditures for the

21:30 ↗ talus slide the trader Joe intersection

21:33 ↗ improvements central park pad one king

21:36 ↗ county roads property purchase the

21:38 ↗ Gilman lofts development as well as some

21:41 ↗ you know professional services for

21:43 ↗ working in our development services

21:44 ↗ department the original budget then I

21:47 ↗ have listed out the ordinances for the

21:51 ↗ the public to note that these changes to

21:54 ↗ the budget happened throughout the year

21:58 ↗ so then that leads us to fund balance

22:01 ↗ and fund balance is basically a measure

22:06 ↗ of the of our liquidity and it's

22:09 ↗ important to note that this is always a

22:11 ↗ forecast of the mount until our

22:12 ↗ financial statements are audited so when

22:16 ↗ when you're looking at it's kind of like

22:17 ↗ reconciling your checkbook because fund

22:19 ↗ balance or fund accounting is like

22:21 ↗ little checkbooks all the funds has a

22:23 ↗ beginning balance you put deposits in

22:25 ↗ you write out some checks for some

22:27 ↗ expenses and then after each line you

22:30 ↗ have an ending fund balance that's the

22:32 ↗ same thing that we deal with in fund

22:34 ↗ accounting and so that every time we

22:37 ↗ take in a deposit and every time we

22:39 ↗ spend some dollars on goods or services

22:41 ↗ that fund balance changes and so I

22:44 ↗ always like to make it be known that the

22:47 ↗ the ending fund balance is something

22:49 ↗ that we always try to have that that new

22:52 ↗ number as we go through record the

22:54 ↗ reconciliation process available for

22:56 ↗ counsel so the fund balance is it is a

23:00 ↗ source of revenue though as we just

23:02 ↗ talked about is that when there's a lot

23:05 ↗ in reserves you can spend it and when

23:07 ↗ there's not a lot reserves you've got to

23:09 ↗ put it back there so in 2017 the the

23:12 ↗ beginning fund balance was sixteen point

23:15 ↗ five million dollars our 2017 revenues

23:19 ↗ exceeded expenditures by over 1.5

23:23 ↗ million dollars and so that improved our

23:25 ↗ 2017 forecasted ending fund balance of

23:28 ↗ eighteen million dollars now we're

23:30 ↗ getting ready to go to through the audit

23:33 ↗ fieldwork and so when we get to that

23:35 ↗ point at this time of the year were the

23:38 ↗ two thousand ending 17 fund balances is

23:42 ↗ pretty we're pretty close in that unless

23:44 ↗ there's something that we've seriously

23:46 ↗ missed and significantly missed but

23:49 ↗ there's always a challenge I'm if I were

23:52 ↗ to talk about prior

23:53 ↗ adjustments we could be here all night

23:55 ↗ so 2017 and the fund balance equates to

23:58 ↗ about 36% of our 2017 expenditures so

24:03 ↗ you can see that when we compare that to

24:04 ↗ our target our reserve target of 15 to

24:08 ↗ 20 percent we have a significant level

24:11 ↗ of reserves at 2017 so with that I'm

24:15 ↗ going to just point out for those who

24:19 ↗ are looking to understand this financial

24:21 ↗ report some of the information with

24:25 ↗ regards to revenues are summarized and

24:28 ↗ show in the different categories on page

24:31 ↗ four of the report the 51 million

24:34 ↗ dollars taken in and then the next page

24:37 ↗ is a summary of expenditures by the

24:40 ↗ department showing a 95 percent of the

24:44 ↗ amended budget spent or utilized and

24:47 ↗ then at the bottom of every fund and

24:51 ↗ you'll see this because all funds are

24:52 ↗ included in this report so our general

24:55 ↗ fund special revenue funds capital

24:57 ↗ project funds debt service funds and our

25:00 ↗ utility funds and other agency funds are

25:02 ↗ all included and you can see the same

25:04 ↗ format it's kind of like an income

25:05 ↗ statement if you're more familiar with a

25:07 ↗ private sector you can see revenues

25:09 ↗ expenditures and you can see then the

25:12 ↗ impact to the funds balances so there

25:16 ↗ you can see the actual revenues over

25:19 ↗ expenses were 1.5 million dollars

25:22 ↗ beginning fund balance changing from

25:25 ↗ balance and an ending fund balance I

25:26 ↗ just wanted to point out to the

25:28 ↗ designation of fund balance this is a

25:31 ↗ Gatsby requirement to note the type or

25:35 ↗ the designation of fund balance because

25:37 ↗ we can't spend it all we have non

25:39 ↗ spindle non spendable items so if you're

25:42 ↗ familiar with inventory that's an amount

25:43 ↗ that's associated with inventory we

25:45 ↗ can't spend it's not cash we have

25:47 ↗ restricted dollars because in the

25:50 ↗ general fund we do have some dollars

25:52 ↗ that are associated with seizure or

25:55 ↗ forfeiture dollars and for the police

25:58 ↗ department and then everything else is

26:01 ↗ unassigned that's to be used at the

26:04 ↗ consuls discretion so with that I would

26:10 ↗ be happy to answer any questions about

26:12 ↗ the 2008 or 2017 year-end report

26:19 ↗ questions for my fellow council members

26:25 ↗ all right that's our seat well we're

26:27 ↗ moving right along then I'm gonna move

26:29 ↗ to the 2018 mid-year report this is on a

26:34 ↗ page I went too fast I was over clicking

26:36 ↗ page 49 again this is a same format I'm

26:44 ↗ going to I'll go through again some

26:47 ↗ major highlights of this but I just

26:49 ↗ wanted to let the council know on page

26:52 ↗ 49 that again this is a emphasis and

26:56 ↗ it's on the general fund it is a

26:59 ↗ snapshot of the fund activity prior to

27:02 ↗ audit and for 2018 we have no budget

27:06 ↗ amendments so this is something that the

27:08 ↗ council will be addressing some proposed

27:10 ↗ budget amendments coming but this report

27:12 ↗ does not include those so for 2018 as as

27:17 ↗ we are at the mid-year point we continue

27:21 ↗ to have your best reserves our tax

27:23 ↗ revenues remain strong the general fund

27:26 ↗ revenues are at 48% of budget and

27:29 ↗ general fund expenditures are at 45

27:31 ↗ percent of budget utilized again utility

27:34 ↗ operator operating revenue is strong so

27:41 ↗ with that we have that we have the same

27:44 ↗ categories of revenue we have received

27:47 ↗ about twenty four and a half million

27:49 ↗ dollars in taxes again we have our large

27:54 ↗ taxes being sales tax B&O tax utility

27:57 ↗ tax and property tax there isn't

28:00 ↗ anything that is kind of hanging out

28:04 ↗ there that that we're seeing that would

28:07 ↗ be problematic for us to remain in that

28:10 ↗ robust and strong economic cycle here

28:15 ↗ property taxes our at the four point six

28:19 ↗ million dollars in collection that's

28:21 ↗ fifty two percent of what we have

28:24 ↗ anticipated and one thing to note about

28:26 ↗ property taxes is that we don't receive

28:30 ↗ revenues route you know consistently on

28:33 ↗ a month-to-month basis this is kind of a

28:36 ↗ big windfall in May and a windfall in

28:40 ↗ November and then property taxes then

28:42 ↗ trickle in so that's why sometimes when

28:46 ↗ you see revenues are under or over it

28:49 ↗ could be because of other agencies who

28:52 ↗ provide that and you might see that in

28:53 ↗ the case of shared revenues where

28:55 ↗ sometimes from other agencies we don't

28:57 ↗ receive that revenue until the third

28:59 ↗ quarter or even the end of the year and

29:01 ↗ so when you say why are why are we not

29:03 ↗ on target there's nothing that alarms us

29:06 ↗ with regards to why we wouldn't be

29:09 ↗ meeting or exceeding our revenue targets

29:16 ↗ any questions on 2018 revenues before I

29:20 ↗ jump into expenditures at the moment

29:25 ↗ okay well we can go back to any to any

29:28 ↗ any question that comes up there I'm

29:34 ↗ going to move around my page here oh

29:37 ↗ sorry

29:38 ↗ councilmember Rey I do have a question

29:40 ↗ so you mentioned that property taxes can

29:43 ↗ be lumpy that is we get them here and

29:45 ↗ there and a little bit in between what's

29:47 ↗ the pattern for other sources of taxes

29:50 ↗ I'm thinking about sales tax is it a

29:51 ↗ linear distribution through the year

29:53 ↗ does it skew one way or the other

29:55 ↗ you know I'm just looking at these

29:57 ↗ things and so is 49% mean we're gonna

30:01 ↗ have a 49% year or does it you know do

30:04 ↗ we get a Christmas bump for sales tax it

30:07 ↗ comes in monthly but there are because

30:12 ↗ we have yes the Christmas bump we have

30:13 ↗ you know we have the holiday bump but

30:16 ↗ there is they're pretty consistent in

30:18 ↗ the city of Issaquah so that's that's

30:20 ↗ kind of a good thing

30:24 ↗ so do we have any ability to have in

30:29 ↗ addition to what we've adopted as a

30:31 ↗ budget in addition to having our accrual

30:33 ↗ do we haven't made near the ability to

30:35 ↗ do a projection for well weeks how we

30:37 ↗ expect to end the year how that might be

30:39 ↗ different than either of those other

30:41 ↗ numbers that's what we're starting to do

30:43 ↗ is we start to develop the budget

30:44 ↗ because it's it's a component of the

30:47 ↗ budget development is where we start to

30:49 ↗ do those year in projections and so

30:52 ↗ certainly that that's something that

30:54 ↗ you'll see when we start having those

30:57 ↗ conversations but for this reports

30:59 ↗ retrospective so we would not have any

31:02 ↗ forecasted information here there is

31:04 ↗ though in a later part of this report

31:07 ↗ some of those projections you see a lot

31:09 ↗ of those are kind of they're just

31:11 ↗ they're just going up because we are in

31:13 ↗ a strong and stable economy and so

31:15 ↗ that's that's why we wanted to share

31:17 ↗ that in another part here because these

31:20 ↗ are budget versus actual and we wanted

31:23 ↗ to give you good clear reports on how we

31:26 ↗ were performing based on the targets

31:29 ↗ that you set for budget

31:31 ↗ okay because if I mean if this includes

31:35 ↗ this includes July then on revenues you

31:41 ↗ know I would if it was evenly spaced and

31:44 ↗ there wasn't a big Christmas bump then

31:46 ↗ I'd expect to be at you know 56.7% not

31:50 ↗ 48 percent and this is as of June I see

31:53 ↗ okay feel better

31:58 ↗ all right so expenditure overview like I

32:01 ↗ indicated there have been no budget

32:05 ↗ amendments that have been considered by

32:07 ↗ the council those are coming for your

32:08 ↗ September 4th meeting the budget

32:11 ↗ amendments that were anticipating are a

32:14 ↗ little over almost 900,000 of some

32:17 ↗ staffing and benefits that the Council

32:19 ↗ of it has addressed and there's agenda

32:20 ↗ bills and in the budget amendment that

32:22 ↗ you'll see we reference the agenda bill

32:25 ↗ where you were already seeing the ask

32:31 ↗ of the administration and then we have

32:34 ↗ some coming up reauthorization requests

32:39 ↗ for the general fund and then we also

32:42 ↗ will be looking at a very very small

32:47 ↗ donation that came in for the Senior

32:49 ↗ Center and then there's a there's a an

32:52 ↗ exact offsetting expenditure to utilize

32:55 ↗ those monies in 2018 so that's what

32:59 ↗ that's what we're anticipating and again

33:02 ↗ will be further conversations about that

33:05 ↗ in September that leads us to again I

33:13 ↗ might sound like a broken record but we

33:15 ↗ have a 2018 identified or a target

33:22 ↗ general fund beginning balance of 18

33:26 ↗ million dollars right now revenues are

33:29 ↗ exceeding expenditures and so when you

33:33 ↗ compare a very very small revenue

33:39 ↗ revenues under expenditures from the

33:41 ↗ budget side on the planning side and

33:43 ↗ where we're at now because we we aren't

33:46 ↗ matched with the revenues at 50 percent

33:48 ↗ and expenditures at 50 percent we're

33:51 ↗ seeing that right now revenues are over

33:54 ↗ expenditures and so we have a fund

33:56 ↗ balance of about 19 million dollars as

33:59 ↗ of June 30th now again checkbook balance

34:02 ↗ changes every time we add money and we

34:04 ↗ pay bills so that that dollar amount has

34:08 ↗ already changed again we do have

34:13 ↗ significant balance though over the

34:16 ↗ council's financial reserve policy of

34:18 ↗ the 15 to 20 percent proportion on 40%

34:24 ↗ at this point right yes we are on page

34:28 ↗ I'm just gonna refer to well we're

34:32 ↗ actually from a from the calculation the

34:37 ↗ percentage of expenditures because we

34:39 ↗ have 19 million dollars and we

34:41 ↗ of only 23 million dollars of

34:44 ↗ expenditures out yes so we are at the

34:47 ↗ 50% target but if you do the math on

34:49 ↗ what we've actually spent - what we you

34:52 ↗ know would have were around the 80 plus

34:55 ↗ percent but yeah yeah these are

34:59 ↗ snapshots these snapshots you wouldn't

35:01 ↗ compare the end of the year to a

35:02 ↗ half-year gives you there - but it's

35:05 ↗ still you know even if we were to take

35:07 ↗ this number and compare it to any sort

35:09 ↗ of projection to the end of here it's

35:11 ↗ gonna be something like forty percent

35:12 ↗ yeah I can't remember right so kind of

35:18 ↗ along those lines it's almost the same

35:19 ↗ question I asked on revenue but

35:21 ↗ unexpensive I mean dude did we see some

35:23 ↗ ik underruns in first few quarters that

35:29 ↗ we would not expect to see the same

35:31 ↗ under-run in the second two quarters

35:33 ↗ that is are they are they are there

35:36 ↗ things that for instance let me just use

35:38 ↗ it for instance if we had some salary

35:41 ↗ savings in the first two quarters and we

35:42 ↗ filled the positions we would not have

35:44 ↗ those salaries savings in the second two

35:45 ↗ course do we have any data that gives us

35:47 ↗ some indication about will this trend

35:50 ↗ continue or will we see ourselves

35:52 ↗ bumping back up to the budgeted level

35:54 ↗ well when I what I'm seeing is that

35:58 ↗ there may have been if there are some

36:00 ↗ delays in some projects or studies to

36:03 ↗ get underway for 2018 that had been

36:06 ↗ identified in any of the departments if

36:09 ↗ those had been delayed for any reason

36:11 ↗ then you would see you would see some

36:14 ↗ that are you know under their budget but

36:17 ↗ then if they've if they've gotten these

36:19 ↗ these these projects on your weight and

36:22 ↗ then we're gonna see that smoothing out

36:24 ↗ and and utilizing their budget now that

36:26 ↗ doesn't mean that they're there could be

36:28 ↗ you know something else that creates a

36:30 ↗ hurdle for departments to spend what

36:33 ↗ they had anticipated but we would want

36:36 ↗ to then capture that in any budget

36:38 ↗ amendment if it was going to be

36:39 ↗ significant so there isn't anything

36:41 ↗ that's that's out there that is cause

36:44 ↗ for concern with regards to you know not

36:48 ↗ getting to our expenditure targets but

36:51 ↗ we'll be knowing that

36:52 ↗ and again because we're going through

36:54 ↗ the projection process through the

36:55 ↗ budget development departments are

36:57 ↗ working with the budget analysts to

36:58 ↗ anticipate what they are they're going

37:01 ↗ to be spending throughout the remainder

37:04 ↗ of the year and so that's an ongoing

37:06 ↗ work that's happening now councilmember

37:12 ↗ winters time thank you yeah and do we

37:15 ↗ keep track of any other non accounting

37:17 ↗ balances such as headcount like budget

37:20 ↗ versus actual like we expected to have

37:22 ↗ so many we got this many your question

37:26 ↗ was on headcount yeah it's like it's a

37:28 ↗ non accounting balance sure

37:31 ↗ I mean we're we you know we had a

37:35 ↗ budgeted number of FTEs so it could it

37:38 ↗ be possible I mean if get this this

37:40 ↗ budget versus actuals you know we you

37:42 ↗ know we have a budget we have an actual

37:44 ↗ variance if that's something that can

37:47 ↗ easily be provided to supplement this

37:50 ↗ information and obviously we don't have

37:51 ↗ it tonight but I think that maybe next

37:53 ↗ time you know we we sit down for a real

37:56 ↗ budget meeting if that's easy to get and

38:00 ↗ I'd like to see that thank you I

38:01 ↗ appreciate that we and we'll put that in

38:03 ↗ the in the in our parking lot and get

38:05 ↗ that information as we have those

38:07 ↗ additional conversations for a budget

38:09 ↗ thank you all right is there any other

38:16 ↗ questions about the 2018 mid-year review

38:21 ↗ it appears not thank you all right so

38:26 ↗ let's move on to a look at our our

38:31 ↗ current debt I do want to point out that

38:34 ↗ council member rate asks some questions

38:37 ↗ thank you very much and there was a

38:40 ↗ revised page that was provided because

38:44 ↗ the charts were flipped and so when

38:48 ↗ you're looking at the second page of the

38:51 ↗ the debt review and I'll grab the page

38:53 ↗ number here 196

38:57 ↗ you'll note that the chart in the in the

39:00 ↗ packet of information that went with the

39:04 ↗ unlimited general obligation debt

39:07 ↗ obligations should have gone below with

39:10 ↗ the limited general obligations but I

39:12 ↗ think we can we can all see and I'll

39:15 ↗ talk quickly about what this information

39:18 ↗ means so the city of Issaquah has a

39:23 ↗ triple-a bond rating and this is through

39:26 ↗ Standard & Poor's this is because we

39:29 ↗ have healthy reserves as well as a

39:33 ↗ significant level of debt capacity so

39:35 ↗ you could issue a lot of debt there's

39:38 ↗ not a lot of cities in Washington to

39:40 ↗ have a triple-a rating and so we

39:43 ↗ maintain that rating as we stay current

39:47 ↗ on our mark and conditions and we

39:50 ↗ contract with a bond advisor to help us

39:53 ↗ with how the marketplace is tolerating

39:57 ↗ the potential for bond issuance I just

40:00 ↗ wanted to provide the council with a

40:03 ↗ note about the low interest rates and

40:08 ↗ what a current trend that's in place is

40:11 ↗ that we instead of going out for these

40:15 ↗ more formal bond issuance it really

40:19 ↗ depends on the bond issue size of it and

40:21 ↗ you know everything that goes into that

40:23 ↗ but the the trend is that we would go

40:26 ↗ out and solicit a bid from privately

40:28 ↗ from banks and we got we're getting very

40:31 ↗ favorable rates so for example when we

40:33 ↗ issued the last portion of the park

40:34 ↗ bonds last year that was that was great

40:39 ↗ rates under 2% so we're still looking at

40:43 ↗ favorable rates not necessarily at 2%

40:45 ↗ but that's just something that we we

40:48 ↗ find out when we go and ask for requests

40:50 ↗ for bids just clarification really quick

40:53 ↗ but you've explained that to us before I

40:56 ↗ want to make sure I understand that

40:57 ↗ instead of go really go into a market

40:59 ↗ place we just found a single private

41:01 ↗ buyer I just I just tried to Reese a

41:04 ↗ what I think I heard you say yes

41:06 ↗ that's correct we we go out and solicit

41:08 ↗ yeah you said a general bond issuance so

41:10 ↗ they're a marketplace someplace where

41:12 ↗ there may where people we don't even

41:14 ↗ know show up and maybe want part that's

41:17 ↗ correct but this is when we're just

41:19 ↗ going to one individual or institution

41:20 ↗ in this case and they're trying to make

41:25 ↗ sure it was clear we we offer it out to

41:27 ↗ any bank who wants to wants to provide a

41:30 ↗ quote mm-hmm so and so it's it's

41:33 ↗ different it's it's less expensive and

41:35 ↗ time-consuming there are still all of

41:37 ↗ the regulations and rules around around

41:40 ↗ issuing debt but what that does is that

41:43 ↗ it allows for banks to see that you know

41:47 ↗ we might be a good fit in their

41:48 ↗ portfolio and that's why we get those

41:50 ↗ favorable rates so the information

41:55 ↗ provided in this in the debt review

41:57 ↗ shows where we at we're at at the end of

42:01 ↗ the year for 2017 where we have assessed

42:04 ↗ valuation of all properties in the city

42:06 ↗ of Issaquah then what it shows there is

42:09 ↗ that we have some certain kind of debt

42:11 ↗ capacity and that's at that

42:12 ↗ two-and-a-half percent of assessed value

42:14 ↗ so we have debt capacity for certain

42:16 ↗ types of levying and certain certain

42:19 ↗ purposes from a capacity standpoint so

42:22 ↗ you can see we have total capacity of

42:24 ↗ that 800 million part of that then comes

42:29 ↗ into play when the council issues konso

42:31 ↗ manic or non voted on debt that means

42:34 ↗ not having to go to the to the voters to

42:36 ↗ ask if you can issue debt so that comes

42:40 ↗ into play where we have to be under a

42:42 ↗ different assessed evaluation limit so

42:46 ↗ you can see that showing there that we

42:48 ↗ have statutory than debt limits are set

42:50 ↗ then we remove the outstanding debt that

42:54 ↗ we have we have 8.1 million in council

42:58 ↗ Manek bonds out there as well as other

43:02 ↗ debt for the that excess levy and parks

43:06 ↗ and open spaces are both voted on levies

43:09 ↗ and so we we total outstanding debt as

43:13 ↗ of the end of 2007

43:15 ↗ is about 25 million dollars we have

43:18 ↗ about eight hundred and seventy eight

43:20 ↗ thousand dollars as of the end of 2017

43:24 ↗ in our debt service funds you would say

43:26 ↗ we don't have enough to cover that

43:27 ↗ that's the amount to pay the annual

43:29 ↗ payment because we receive tax dollars

43:32 ↗ into these funds and then we pay the

43:33 ↗ debt service out for those folded pieces

43:36 ↗ so you can see our debt capacity is

43:39 ↗ quite large in the bottom blue line what

43:43 ↗ I wanted to also provide for the council

43:46 ↗ just so that you could see a perspective

43:49 ↗ of our annual debt service this is this

43:52 ↗ is our current obligations of the

43:55 ↗ council Manek debt at over two million

43:57 ↗ dollars every year and we have then the

44:01 ↗ excess levy the voters approved and our

44:05 ↗ current year debt obligation is a little

44:08 ↗ over 1.7 million dollars I just wanted

44:11 ↗ to put in a perspective that the council

44:14 ↗ Matic bonds or our debt service is about

44:16 ↗ four percent of our general fund current

44:20 ↗ year expenditures so oftentimes that's

44:23 ↗ something that we get asked to say well

44:26 ↗ what's what's the percentage of debt as

44:28 ↗ as compared to our total expenditures so

44:31 ↗ we're at about four percent so I think

44:38 ↗ it'd be useful to understand not today

44:43 ↗ but in future meetings how that compares

44:46 ↗ with comparable cities

44:48 ↗ how does Redmond look how does Kirkland

44:51 ↗ look as we consider options that would

44:54 ↗ take on additional debt for in for

44:57 ↗ infrastructure and transportation it'd

44:59 ↗ be really good to understand like we

45:01 ↗ know we're in a great place with ending

45:02 ↗ fund balance right that 4% Seifer

45:04 ↗ present' I don't have anything to

45:05 ↗ compare that to okay we will do that

45:07 ↗ thank you

45:11 ↗ all right the next page then if you take

45:15 ↗ the amended report you can see visually

45:18 ↗ that our our our unlimited geo bonds or

45:26 ↗ those are the the bonds that had voter

45:28 ↗ approval that those those amortization

45:31 ↗ schedules run out about one

45:34 ↗ one-and-a-half our that's at one point

45:35 ↗ seven out to about two thousand twenty

45:38 ↗ six and then we start to drop down so

45:40 ↗ that's the that's the bond payment

45:42 ↗ starts to go down principal and interest

45:43 ↗ as we then run out in those bonds mature

45:47 ↗ in 2033 then we if we compare then and

45:53 ↗ what kind of we'll be talking about this

45:54 ↗ when we talk about the financial model

45:56 ↗ the the the graph that depicts our

45:59 ↗ limited geo obligations this is the

46:02 ↗ council Manek bonds you can see that

46:04 ↗ we're we have a debt service payment of

46:06 ↗ about two million dollars well very

46:08 ↗ quickly we're gonna start to drop and so

46:11 ↗ in 2019 2020 we're starting to see our

46:16 ↗ obligation annually drop half a million

46:18 ↗ dollars and so eventually we would have

46:21 ↗ we have no debt and so this is something

46:25 ↗ that I wanted to show and depict this

46:27 ↗ way that we would we would start here

46:31 ↗ then and when the council starts to make

46:33 ↗ a decision about debt issuing debt to

46:37 ↗ see how that would change and and there

46:40 ↗ is a picture of that when we are getting

46:42 ↗ into some of our assumptions and in the

46:44 ↗ model the questions on our current debt

46:50 ↗ and again the revised page was sent out

46:54 ↗ to counsel prior to just just right

46:56 ↗ before the meeting so it looked like a

47:00 ↗ quizzical look but no hands if a council

47:03 ↗ member hunt

47:07 ↗ so the debt obligation for the non

47:12 ↗ booted on his flat for a longer than or

47:17 ↗ the voted debt and so I'm just so my

47:21 ↗ question is why why is that difference

47:23 ↗ in the rates so much later for the non

47:27 ↗ voted debt if I'm under said that is

47:31 ↗ it's the annual payment and so our

47:33 ↗ annual payment based on the bond

47:35 ↗ amortization schedule it was just

47:38 ↗ designed in that way so our our payments

47:42 ↗ go down about a half a million dollars

47:46 ↗ over the course of the next three or

47:49 ↗ four years and so we we essentially

47:52 ↗ would not have a debt payment and so

47:54 ↗ that flat line is it's just a depiction

47:58 ↗ of the the payment each year year over

48:00 ↗ year right okay but all that's the

48:03 ↗ question maybe slightly differently have

48:05 ↗ we have we exercised non voted more

48:08 ↗ recently than voted like these are the

48:11 ↗ schedules you know it's just there

48:13 ↗ appears to be more I mean if we look at

48:19 ↗ our debt service is comparable between

48:23 ↗ voted and non voted at the moment but

48:25 ↗ the total outstanding there's much more

48:30 ↗ voted in than there is non voted in

48:33 ↗ and yet the voted in drops faster well

48:39 ↗ the voted in drops faster in I'm just

48:42 ↗ trying to because the we just issued it

48:49 ↗ just issued the last piece of the park

48:52 ↗ bonds and so that is that is also

48:55 ↗ included in our annual payment for the

48:58 ↗ voted in bonds and that's that is the

49:02 ↗ structure of the repayment of the bonds

49:06 ↗ so I'm not sure if I have an answer to

49:09 ↗ say why one is more than the other

49:12 ↗ the council has has not issued any

49:14 ↗ councilmen

49:15 ↗ debt for quite a long time

49:19 ↗ and so that's why you see basically no

49:22 ↗ no debt obligation but the council

49:25 ↗ didn't or the or the community voted to

49:29 ↗ or the excess levy and so therefore that

49:32 ↗ that was a bigger amount of money so

49:35 ↗ it's just the chart that's backwards it

49:38 ↗ wasn't corrected here okay

49:40 ↗ it was I thought it was corrected in

49:42 ↗ this version okay not corrected in the

49:44 ↗ book version okay I totally get it okay

49:47 ↗ I thought this was the correct oh my

49:49 ↗ apologies okay now that was played why I

49:51 ↗ was utterly can was that why you were

49:53 ↗ confused several people that was why

49:55 ↗ they're confused so the correction it

50:01 ↗ that was in the original printed fiscal

50:03 ↗ forecasting book if you take the the two

50:06 ↗ charts they were flipped so it was a

50:08 ↗ copy-paste this is good so the the

50:11 ↗ charts are they're correct they were

50:13 ↗ just under the wrong categories so this

50:16 ↗ is the corrected one no this is not the

50:21 ↗ corrected one there was an amendment

50:28 ↗ after what added so thank you there in

50:31 ↗ the ninety cents yeah

50:36 ↗ can you could you go back there to make

50:40 ↗ it larger

50:41 ↗ not larger make it smaller to do show

50:43 ↗ the comparison there we go yes this is

50:49 ↗ the correct one that's remember winters

50:53 ↗ time don't leave Tina second to be a

50:56 ↗ master the document you go back to page

51:00 ↗ 103 of the today's packet

51:07 ↗ and it's it's it was just a thing

51:10 ↗ there's just a page before where we were

51:12 ↗ and it's the debt review current-gen

51:17 ↗ it's the the outstanding line less debt

51:23 ↗ outstanding geo bonds there is no longer

51:31 ↗ okay this is not which page number its

51:39 ↗ page 95 of the original packet you going

51:44 ↗ up right there

51:48 ↗ so the yeah so midway through that table

51:53 ↗ less debt outstanding you see about 8.1

51:58 ↗ and counsel Matic 7 7 and XS parks and

52:02 ↗ open space 9 what those are as of when

52:06 ↗ those are as of 12:30 1 2017 okay okay

52:13 ↗ all right okay I see that date there

52:14 ↗ okay that was oh I see that date jumps

52:17 ↗ out at me because I was looking I was

52:19 ↗ comparing those two hour those are the

52:21 ↗ exact same amounts they were at the end

52:22 ↗ of September 2017 as well I was just

52:26 ↗ because I was looking I know I had that

52:28 ↗ in front was looking at to see what we

52:29 ↗ actually had counsel Matic bonds and for

52:31 ↗ I'm not sure where I can't recall if top

52:33 ↗ my head what we're using the council

52:35 ↗ Matic bond for so I looked at the old

52:37 ↗ budget that I noticed these numbers are

52:38 ↗ exactly the same because we we know

52:40 ↗ because we have the we have the

52:42 ↗ amortization and so we know what the

52:45 ↗ outstanding debt is at the end of every

52:49 ↗ year so it's something that we could see

52:51 ↗ that we would have the same amount for

52:55 ↗ you if the report said June 2017 we know

52:59 ↗ what our ending debt would be at the end

53:01 ↗ of the year and so I think we can do it

53:03 ↗ better we can clarify that better that

53:05 ↗ that this is this is based on the

53:07 ↗ amortization schedule so it wouldn't

53:10 ↗ change it just so happens that those

53:11 ↗ amounts exactly match as of September

53:14 ↗ 30th to 7 2017 as well we knew what

53:18 ↗ those we knew what those balances were

53:20 ↗ so we should we should have noted that

53:22 ↗ they that they were the balances

53:23 ↗ identified for 2000 at the end of 2017

53:27 ↗ the report was just dated September and

53:31 ↗ it wasn't the outstanding bonds as of

53:33 ↗ September it was as of the end of the

53:35 ↗ year 2017 ok maybe actually said yeah it

53:38 ↗ says September 30th okay thank you

53:49 ↗ any more questions on the depth review

53:55 ↗ actually I did sorry it was what do we

53:58 ↗ what's that's inside that on council

54:01 ↗ have we issued a council Matic bond so

54:03 ↗ the current bonds for council annek

54:05 ↗ bonds are paying for what well the cons

54:09 ↗ of matic bonds off the top my head they

54:14 ↗ were for there's a variety of reasons

54:21 ↗ for there was some police and we're

54:24 ↗ pulling that up now what will that we

54:26 ↗ might want to get that back to the

54:27 ↗ council so we can get you that accurate

54:29 ↗ information there's a number of debt

54:32 ↗ issuance you know what during the 2018

54:33 ↗ budget I found it here Highlands Park I

54:36 ↗ can answer my own question here there is

54:39 ↗ 2006 2007 2009 and 2014

54:42 ↗ oh there's some 2014 Highland Park

54:46 ↗ facilities all right so it was under our

54:48 ↗ watch hmm hey thank you some of us over

54:53 ↗ you are off the hook

54:55 ↗ shall we proceed any other questions

54:57 ↗ nope nope all right all right okay so

55:01 ↗ let's talk up a little bit about

55:02 ↗ long-term financial model this is on

55:07 ↗ page 97 of the original packet so as we

55:14 ↗ as we talk about incorporating long term

55:18 ↗ council long term goals and financial

55:21 ↗ strategies we wanted to provide a way to

55:24 ↗ look at not only where we've been

55:27 ↗ historically and and if some of you

55:30 ↗ remember because the financial models

55:32 ↗ and a little bit different format

55:33 ↗ because it was it was it was big sheets

55:37 ↗ big spreadsheets and a lot of

55:39 ↗ information and so we wanted to

55:40 ↗ synthesize this down into a way that we

55:44 ↗ could quickly have a conversation about

55:46 ↗ where's our baseline where's our

55:48 ↗ starting point and if we do a B C or D

55:51 ↗ how does it look

55:53 ↗ and so we've integrated some potential

55:58 ↗ general fund debt service obligations

56:00 ↗ for projects that are

56:02 ↗ and in the CIP this is something that

56:04 ↗ the ad-hoc committee has been working on

56:07 ↗ to help the administration present this

56:10 ↗ information in a way that would be

56:12 ↗ useful for decision-making and so this

56:15 ↗ is a financial model is a living

56:18 ↗ document so when a decision is made

56:20 ↗ we're gonna update the model and we're

56:22 ↗ going to then you know continue to

56:25 ↗ provide this as a decision-making tool

56:27 ↗ because it identifies the revenues that

56:31 ↗ we anticipate expenditures that that we

56:35 ↗ expect and then that impact on an ending

56:37 ↗ fund balance and so we we look to do a

56:40 ↗ conservatively objective measure of our

56:45 ↗ our forecasts because we just didn't

56:47 ↗ want to be too optimistic so the model

56:51 ↗ provides a baseline scenario and I'll

56:54 ↗ walk through those assumptions here in a

56:55 ↗ little bit it was based on an analysis

56:59 ↗ of our historical and current financial

57:02 ↗ environment revenues operating and

57:05 ↗ capital expenditure forecast our current

57:08 ↗ debt and potential debt and then we look

57:11 ↗ to do some affordability analysis and

57:13 ↗ that's and I'll talk about that in the

57:15 ↗ financial indicator section but again

57:18 ↗ this model is updated routinely and the

57:22 ↗ ad hoc committee had some dis of great

57:25 ↗ work and had some good discussions about

57:29 ↗ putting together scenarios for how we

57:33 ↗ start to tackle primarily our

57:34 ↗ transportation issues so the next page I

57:38 ↗ want to just briefly cover the

57:42 ↗ assumptions that were used in our

57:44 ↗ financial model what you'll see this is

57:47 ↗ on page 97 I want to make sure I'm given

57:51 ↗ the right page number 98 excuse me

57:57 ↗ so our assumptions are where we start

58:00 ↗ with at the baseline we used an

58:03 ↗ assumption for general economic growth

58:05 ↗ for revenue unless otherwise noted and

58:08 ↗ so we use 3% for most of the scenarios

58:11 ↗ with the exception of scenario D we also

58:15 ↗ then going down the rows use specific

58:17 ↗ revenue assumptions for economic growth

58:19 ↗ and you might see that some might be the

58:22 ↗ same and you might say why be a no tax

58:25 ↗ we see as increasing 3% it's based on

58:28 ↗ the three-year average we wanted to

58:30 ↗ segregate that out because it's a major

58:32 ↗ source of revenue

58:33 ↗ just like we segregated out sales tax

58:35 ↗ and property tax and so you might say

58:36 ↗ that's just kind of irrelevant but we if

58:39 ↗ we wanted to look at a scenario where it

58:42 ↗ just had a deep decline it was available

58:44 ↗ to do that in a scenario sales tax

58:48 ↗ increasing again on a three-year average

58:50 ↗ is at a four percent so that's obviously

58:54 ↗ more and then you see property tax

58:56 ↗ because they're subject to the state law

58:58 ↗ and limitations of one percent plus any

59:01 ↗ new construction growth and you'll see

59:03 ↗ ncg that is what that means new

59:05 ↗ construction growth so that's added on

59:08 ↗ top of the one percent

59:10 ↗ and then we wanted to add in a

59:12 ↗ possibility of a new revenue source and

59:15 ↗ we put in new revenue because we don't

59:18 ↗ know what that is that that is something

59:19 ↗ for these future discussions of the

59:22 ↗ council on the expenditure side then we

59:24 ↗ used a general economic growth for

59:27 ↗ expenditures unless otherwise noted we

59:30 ↗ talked we we talked about do we just

59:33 ↗ have one for both general for revenues

59:36 ↗ and expenditures and so we wanted to

59:38 ↗ separate it out in case we wanted to

59:40 ↗ have a scenario that said revenues we

59:43 ↗ don't see any good outlook and

59:46 ↗ expenditures are just going to keep

59:48 ↗ rising so then we have a specific

59:50 ↗ expenditure assumptions and what we did

59:52 ↗ in the baseline is what we wanted to

59:53 ↗ make an assumption that we had annual

59:56 ↗ new staffing for enhanced levels of

59:58 ↗ service so we didn't define what that

59:59 ↗ level of service was but an enhanced

1:00:02 ↗ level of service so new staffing we

1:00:04 ↗ wanted to show about three and a half

1:00:07 ↗ percent

1:00:08 ↗ each year so that we that we were always

1:00:15 ↗ assuming that there would be some growth

1:00:17 ↗ in FTE they also wanted to put into play

1:00:22 ↗ and this is primarily where that some of

1:00:23 ↗ the biggest changes come because for

1:00:26 ↗ tackling some of the transportation

1:00:28 ↗ issues it means issuing debt and paying

1:00:31 ↗ a debt service payment and paying a

1:00:33 ↗ principal and interest payment and

1:00:35 ↗ that's what we were just talking about

1:00:36 ↗ what we have in the our current debt we

1:00:41 ↗ also included the obligation for the

1:00:43 ↗ transit-oriented development and that is

1:00:46 ↗ included in the baseline it's also

1:00:49 ↗ included in any scenario change that you

1:00:52 ↗ see in the line above but we did include

1:00:54 ↗ that because that has also been an

1:00:56 ↗ obligation that has been already

1:00:58 ↗ obligated in some cases in the the 2000

1:01:04 ↗ in the baseline the 2018 budget adopted

1:01:08 ↗ this does include the those budget

1:01:11 ↗ amendments that I talked about earlier

1:01:12 ↗ and that is those staffing changes and

1:01:15 ↗ the reauthorizations for a couple of

1:01:18 ↗ projects one comment I think of probably

1:01:24 ↗ many in the annual debt service

1:01:26 ↗ obligation as a percentage of the

1:01:27 ↗ expenditures in the baseline 4% I think

1:01:30 ↗ that should just be clear that this is

1:01:32 ↗ we're just talking about council Matic

1:01:34 ↗ bonds and this has nothing to do with

1:01:35 ↗ any voted in debt this is us just using

1:01:38 ↗ existing cash flows and here that's what

1:01:44 ↗ has its own restricted funds thank you

1:01:48 ↗ for bringing that up because if one

1:01:50 ↗ looks at those if you look at the any of

1:01:52 ↗ the reports a year on report or the 2018

1:01:54 ↗ mid-year report because it has all of

1:01:56 ↗ those funds if you were to look at the

1:01:59 ↗ the fund for voted in debt those tax

1:02:03 ↗ dollars go directly into that fund and

1:02:05 ↗ the debt service is paid out it so it

1:02:07 ↗ does not touch the general fund

1:02:08 ↗ it's the council Manek bonds where the

1:02:11 ↗ where the general fund has to transfer

1:02:13 ↗ some dollars to that fund so you see a

1:02:15 ↗ transfer in and then you see the debt

1:02:17 ↗ service going out so thank you for

1:02:18 ↗ bringing that up

1:02:20 ↗ deputy council president Matisse so

1:02:24 ↗ thank Thank You Jen I just had a couple

1:02:27 ↗ questions so I can better understand the

1:02:29 ↗ assumptions so with the annual new

1:02:32 ↗ staffing resources in scenario B which

1:02:37 ↗ which would be the economic downturn you

1:02:42 ↗ you were still having 3.5% for new

1:02:47 ↗ staffing okay and then likewise on

1:02:50 ↗ scenario B where there's an additional

1:02:54 ↗ source you still have that at 3.5% so

1:02:57 ↗ across the board really seeing that in

1:03:00 ↗ the assumptions anyway yes we left that

1:03:02 ↗ flat because then that would kind of

1:03:04 ↗ align with a a more conservative of

1:03:07 ↗ objective approach is that we may have

1:03:11 ↗ added staff and continued have to add

1:03:12 ↗ staff for delivering levels of service

1:03:15 ↗ and certainly that that's something in

1:03:17 ↗ an economic downturn is that it is it a

1:03:21 ↗ short chill is it a long a long term

1:03:24 ↗ recession and so there still may be a

1:03:26 ↗ plan going forward to continue to add

1:03:29 ↗ staff maybe not at that level but it was

1:03:32 ↗ it was just a way to show that we

1:03:34 ↗ routinely

1:03:35 ↗ are continuing to add staff to ensure

1:03:38 ↗ that we provide quality levels of

1:03:40 ↗ service okay and then the general

1:03:43 ↗ economic growth for expenditures is also

1:03:45 ↗ at 3% for the economic downturn so just

1:03:49 ↗ again flat across with your assumptions

1:03:52 ↗ okay I was trying to better understand

1:03:55 ↗ that Thanks tell us member winter Stein

1:03:56 ↗ I want to pick up on something where I

1:04:00 ↗ just said so I'm missing the point about

1:04:02 ↗ an economic downturn scenario B as an

1:04:05 ↗ economic downturn

1:04:06 ↗ adhi well I thought you said B so my

1:04:09 ↗ mistake that's how I'm looking at this

1:04:10 ↗ and

1:04:16 ↗ up above it says scenario B you're right

1:04:18 ↗ scenario D we've got to be in a D sorry

1:04:21 ↗ okay that it was D that I was talking

1:04:24 ↗ about okay thank you so I'm kind of

1:04:31 ↗ curious and and maybe this is something

1:04:33 ↗ for to bring back but I I think deputy

1:04:37 ↗ president batiste is brings up a really

1:04:40 ↗ good point which is if we're having an

1:04:42 ↗ economic downturn we're probably not

1:04:43 ↗ adding 3.5% in staffing and I'm curious

1:04:49 ↗ to see what would happen to that that

1:04:51 ↗ chart if we flattened out both the

1:04:54 ↗ revenues and the expenses Oh City

1:05:01 ↗ Administrator thank you

1:05:03 ↗ we can certainly run that scenario the

1:05:06 ↗ purpose of putting together these

1:05:08 ↗ scenarios was to just create some

1:05:11 ↗ bookends so that you can see under one

1:05:15 ↗ changing condition what sort of effect

1:05:18 ↗ does that have on the whole so that is

1:05:22 ↗ why you see staffing assumption

1:05:26 ↗ remaining constant across the scenarios

1:05:28 ↗ we just want to adjust one variable so

1:05:30 ↗ in this case we were adjusting the

1:05:32 ↗ revenue side of the equation and

1:05:34 ↗ scenario D so that you can just see that

1:05:37 ↗ impact but council members are are

1:05:40 ↗ correct under real-life conditions we

1:05:44 ↗ would make other adjustments to make

1:05:47 ↗ sure that we balanced out this is just

1:05:49 ↗ for painting a picture of what happens

1:05:51 ↗ if you have less revenue but you keep

1:05:55 ↗ other things constant

1:06:02 ↗ deputy council president patís Thank You

1:06:06 ↗ Emily so that was really the purpose of

1:06:10 ↗ my questions so with assumption modeling

1:06:12 ↗ that way you're as you're trying to look

1:06:15 ↗ across you're able to compare apples to

1:06:17 ↗ apples Thanks it comes from Winchester

1:06:23 ↗ thank you I think before we move off

1:06:27 ↗ this page those that didn't have the

1:06:29 ↗ opportunity that the rest of us did in

1:06:32 ↗ committee to review this this is really

1:06:35 ↗ the time to challenge some of the

1:06:37 ↗ assumptions that we have or at least

1:06:38 ↗ understand them I'd say maybe not at

1:06:40 ↗ this point let's really make sure we

1:06:42 ↗ understand each one of these before we

1:06:44 ↗ move on and I know that some of the

1:06:48 ↗ things that we wrestled with in

1:06:49 ↗ committee where you can like the head

1:06:52 ↗ count for example I think the original

1:06:54 ↗ proposal was just a fixed number and we

1:06:56 ↗ said no let's do it as a percent we

1:06:59 ↗ thought that that would would be a

1:07:00 ↗ better model and then and then this idea

1:07:05 ↗ scenario a was was everything in the

1:07:11 ↗ transportation TI p but we funded

1:07:13 ↗ ourselves we don't go ask for any

1:07:15 ↗ dollars all the unfunded portion of the

1:07:17 ↗ transportation TI p we just we its

1:07:20 ↗ existing revenues we find our savings

1:07:23 ↗ somewhere else we know we're going to

1:07:24 ↗ get some back because our debt

1:07:25 ↗ obligation is going to go down but this

1:07:27 ↗ was a scenario we just pay for it no no

1:07:30 ↗ ask of the people of for anything and

1:07:32 ↗ then B was no I'll just take half of it

1:07:36 ↗ thinking was what let's let's use our

1:07:42 ↗ existing revenue to fund half of the

1:07:47 ↗ unfunded transportation projects because

1:07:50 ↗ some of the transportation has funding

1:07:51 ↗ associated or we and we're forecasting

1:07:53 ↗ getting grant money and other sources of

1:07:55 ↗ money but there is an unfunded component

1:07:57 ↗ and I would just recommend I always keep

1:07:59 ↗ an electronic copy of the the CIP budget

1:08:01 ↗ at hand so I can always look at those

1:08:03 ↗ real quickly so I think that's very

1:08:05 ↗ handy to do so be said let's just do

1:08:08 ↗ half let's just fund half of that

1:08:10 ↗ outstanding balance and maybe just maybe

1:08:12 ↗ we'll get some projects under our

1:08:14 ↗ and and demonstrate to ourselves that we

1:08:17 ↗ can do this and we can do it well and

1:08:19 ↗ then maybe maybe that would be a time

1:08:22 ↗ where we go back out and ask the voters

1:08:25 ↗ to fund the balance of the unfunded half

1:08:29 ↗ and that's what C represents so funny is

1:08:35 ↗ fun at all don't ask for any new B is

1:08:39 ↗ without any new revenue fun half of the

1:08:42 ↗ unfunded balance and and C goes out and

1:08:45 ↗ asks the people for the revenue for the

1:08:49 ↗ other half of the unfunded balance does

1:08:51 ↗ that make sense those are the scenarios

1:08:57 ↗ thanks Paul that's helpful

1:08:59 ↗ cops remember Ramos just for me the

1:09:02 ↗ scenario D and I know what you're trying

1:09:04 ↗ to say

1:09:04 ↗ I mean trend only change one thing but

1:09:07 ↗ as you said the realistic part of it is

1:09:10 ↗ hard to look at it because if you just

1:09:12 ↗ assume everything may the expense side

1:09:14 ↗ just keeps growing but you just cut your

1:09:16 ↗ revenue you know that just wouldn't be

1:09:18 ↗ realistic so I find a hard time now you

1:09:21 ↗ say it's comparing apples that was to me

1:09:23 ↗ it changed at Apple to an orange so then

1:09:25 ↗ looking at that with the other without

1:09:27 ↗ making adjustments there which you we

1:09:30 ↗ would have to do it it doesn't give me a

1:09:32 ↗ good comparison that way so I guess the

1:09:35 ↗ challenge on the two columns there of

1:09:37 ↗ growth of expenditures 3% and the three

1:09:40 ↗ and a half percent growth of staffing it

1:09:44 ↗ makes it look like a lot worse than it

1:09:48 ↗ probably would councilmember hunt

1:09:53 ↗ thank you so I have a question about the

1:09:57 ↗ new construction growth and assessed

1:09:59 ↗ valuation that is held constant across

1:10:03 ↗ the model right

1:10:06 ↗ and then how how is that factored in

1:10:09 ↗ with the model so it's 1% plus new

1:10:13 ↗ construction growth in assessed

1:10:16 ↗ in the financial model what we identify

1:10:20 ↗ is a 1% growth in the property of

1:10:24 ↗ property tax that is not the same actual

1:10:28 ↗ growth in assessed valuation and so the

1:10:32 ↗ the 1% is what we calculate as being our

1:10:36 ↗ our limit based on those forecasts for

1:10:39 ↗ assessed valuations based on our growth

1:10:42 ↗ our growth projections and so then the

1:10:45 ↗ new construction value is is not a

1:10:48 ↗ static number that's also going up based

1:10:52 ↗ on our historical growth in new

1:10:54 ↗ construction I think some of the the

1:10:57 ↗ numbers are around 280 some thousand in

1:11:02 ↗ new construction growth and so that

1:11:05 ↗ we've we've taken and we just we

1:11:08 ↗ increase that based on our our new

1:11:11 ↗ construction growth of about three to

1:11:13 ↗ four percent every year but it's there's

1:11:16 ↗ there's a lot of detail in into that

1:11:18 ↗ line item because it because one it's

1:11:20 ↗ not static and the 1% is just based off

1:11:24 ↗ of the calculation of our assessed

1:11:28 ↗ valuations and you can see and that was

1:11:31 ↗ in one of the reports and we've got some

1:11:32 ↗ information in our our growth in our

1:11:35 ↗ assessed valuations later on in the

1:11:37 ↗ report and then I can show you how we

1:11:40 ↗ calculate that because we are assuming

1:11:43 ↗ that our property valuation this us

1:11:45 ↗ about that's just a depiction of that 1%

1:11:50 ↗ of that that dollar amounts so I can

1:11:54 ↗ answer that question maybe a little bit

1:11:55 ↗ later have some of your race so I have a

1:12:00 ↗ question and a concern my question is

1:12:02 ↗ what we're really trying to do here is

1:12:04 ↗ to establish what our realistic new debt

1:12:08 ↗ capacity is for capital improvements

1:12:13 ↗ using council Matic bonds is that the

1:12:16 ↗ intent of what we're driving at here yes

1:12:18 ↗ so my concern is we keep talking about

1:12:21 ↗ transportation and I don't think we've

1:12:23 ↗ ever had a discussion

1:12:23 ↗ as counsel about that so I I think that

1:12:27 ↗ it's fine as an ie

1:12:28 ↗ you know such as investing in the you

1:12:30 ↗ know more transportation initiatives but

1:12:32 ↗ I don't ever recall us having a

1:12:34 ↗ discussion about we're gonna look to

1:12:35 ↗ invest much more in transportation than

1:12:38 ↗ we are right now so this could be other

1:12:40 ↗ capital investments as well as

1:12:42 ↗ transportation less your mark fair okay

1:12:49 ↗ so noted I'm something of a wintry Stein

1:12:54 ↗ I'm gonna go back to what Vicki asked a

1:12:58 ↗ second ago I'm gonna stick bet with the

1:13:00 ↗ new construction growth I want to make

1:13:05 ↗ sure I have this correct so there's new

1:13:07 ↗ construction in 2018 and we're going to

1:13:10 ↗ there's going to be some assessment of

1:13:12 ↗ that value they're gonna be charged a

1:13:15 ↗ property tax and we're gonna we're gonna

1:13:18 ↗ get that in 2018 now that property in

1:13:22 ↗ its assessed value in 2019 will go into

1:13:27 ↗ the pool that has a limited growth of 1%

1:13:30 ↗ so so this so where it says and say if

1:13:35 ↗ so one percent plus ncg that ncg at one

1:13:39 ↗ year is into the 1% pool maximum growth

1:13:42 ↗ the next year so every subsequent year

1:13:46 ↗ the new construction growth goes goes

1:13:48 ↗ into the pool where it's limited there's

1:13:49 ↗ no limit to the new construction growth

1:13:51 ↗ because we don't we they've never been

1:13:52 ↗ taxed before there's no this is the

1:13:54 ↗ first assessment on some improvement on

1:13:56 ↗ the property the first year's assessment

1:13:59 ↗ it's got a value okay now that becomes

1:14:01 ↗ part of the assessment pool that we have

1:14:03 ↗ limited growth in in subsequent years so

1:14:06 ↗ it's you're nodding your head I think

1:14:07 ↗ that's that's important thank I mean

1:14:11 ↗ thank you for acknowledging my statement

1:14:14 ↗ of understanding deputy council

1:14:16 ↗ president impetus I just in in regard to

1:14:21 ↗ feedback on the assumptions one thing

1:14:25 ↗ that I was pleased to see is that when

1:14:26 ↗ we're we're talking about

1:14:29 ↗ the staffing resources that were also

1:14:32 ↗ listing enhanced levels of service that

1:14:34 ↗ to give us an opportunity that if we're

1:14:37 ↗ talking about that that we're talking

1:14:40 ↗ about what level of service we want to

1:14:43 ↗ have and something that we I I think you

1:14:46 ↗ know that we talked about during the

1:14:47 ↗ last budgeting session in terms of what

1:14:51 ↗ are the levels of service that we're

1:14:52 ↗ focusing on

1:15:01 ↗ any other questions or comments at the

1:15:03 ↗ moment alright let's proceed okay thank

1:15:07 ↗ you next page is really a key age in

1:15:17 ↗ most of this report because it's a chart

1:15:20 ↗ and it has the what for this discussion

1:15:26 ↗ purposes was to show all of the baseline

1:15:30 ↗ ending fund balance and this is general

1:15:33 ↗ fund how the ending fund balance is for

1:15:37 ↗ is forecasted so the baseline scenario a

1:15:41 ↗ scenario B scenario D so what happens

1:15:43 ↗ then to the ending fund balance forecast

1:15:47 ↗ when we lay it all over into one chart

1:15:51 ↗ and so what I wanted to point out is is

1:15:54 ↗ just some of the colors to show that

1:15:58 ↗ with the baseline you can see that the

1:16:02 ↗ purple ending fund balance starts at

1:16:07 ↗ they're all starting at the same point

1:16:09 ↗ starts at the just below 20 million

1:16:12 ↗ dollars and pretty much skyrockets

1:16:15 ↗ because one of the main reasons is there

1:16:20 ↗ would be no more debt that would be

1:16:22 ↗ issued because you can see in the

1:16:23 ↗ assumptions we're assuming additional

1:16:26 ↗ staffing we're assuming expenditure

1:16:28 ↗ growth at 3 percent we're assuming

1:16:30 ↗ revenue growth at 3 percent some a

1:16:32 ↗ little bit higher sales tax and so you

1:16:36 ↗ can see that this is a the purple line

1:16:39 ↗ is a very positive picture doing only

1:16:43 ↗ those things that are in the baseline

1:16:44 ↗ now that doesn't mean that we've

1:16:46 ↗ identified specifically but we've we've

1:16:48 ↗ identified a level of assumptions that

1:16:50 ↗ we would move forward with I want to

1:16:53 ↗ jump over and then talk about the

1:16:57 ↗ scenario a which is the orange line and

1:17:05 ↗ this is the exact opposite because this

1:17:07 ↗ is what I think was referred to and we

1:17:09 ↗ were talking about in our ad-hoc

1:17:11 ↗ committee as the apocalypse and so you

1:17:13 ↗ can see that ending fund balance

1:17:15 ↗ starting at just under twenty million

1:17:16 ↗ dollars goes severely downward into the

1:17:21 ↗ negative realm and so I just wanted to

1:17:24 ↗ give you both ends where we've got

1:17:27 ↗ baseline and we've got scenario a I just

1:17:31 ↗ wanted to then point out the green lines

1:17:33 ↗ in between are the council's reserve

1:17:36 ↗ policy so you see the dark green is

1:17:39 ↗ where the ceiling for your reserves are

1:17:44 ↗ identified in policy and then the light

1:17:46 ↗ green is the floor so that's the 15% of

1:17:50 ↗ those expenditures so you can see that's

1:17:51 ↗ that's kind of our target so we've got

1:17:56 ↗ the as a scenario that identified if we

1:17:59 ↗ tackled every piece of the unfunded

1:18:04 ↗ transportation projects in the CIP that

1:18:09 ↗ we would not have enough not enough

1:18:12 ↗ money in our ending fund balance in

1:18:14 ↗ order to accommodate so that that is

1:18:16 ↗ just not a sustainable scenario then we

1:18:19 ↗ go into scenario B and that is the blue

1:18:23 ↗ line and you can see that the blue line

1:18:26 ↗ does dip down in a few years primarily

1:18:30 ↗ because we have existing council Matic

1:18:33 ↗ debt we still have a payment but as you

1:18:35 ↗ can see in that in the amended graphed

1:18:38 ↗ for the debt that that was provided you

1:18:42 ↗ can see that that debt those debt

1:18:44 ↗ obligations were going down and so what

1:18:47 ↗ the blue line depicts is that we

1:18:49 ↗ continue to pay that debt if the council

1:18:51 ↗ chooses to issue debt for tackling some

1:18:55 ↗ projects we would dip down into our

1:18:58 ↗ reserves to do that all things being the

1:19:02 ↗ same in the assumptions but then we

1:19:04 ↗ would start to come back up because

1:19:05 ↗ again existing debt obligations drop off

1:19:08 ↗ but what this shows is that this it's

1:19:10 ↗ about a two point one two point five

1:19:14 ↗ million

1:19:14 ↗ our annual debt service and so basically

1:19:16 ↗ what this scenario shows is that we're

1:19:18 ↗ going to continually have about that

1:19:21 ↗ level of debt service about that four

1:19:24 ↗ percent five percent of expenditures

1:19:26 ↗ towards debt obligations console Matic

1:19:29 ↗ bonds so that's the blue line that

1:19:33 ↗ scenario see then was a scenario that

1:19:36 ↗ added in a source of revenue to help

1:19:38 ↗ either offset and remove some of the

1:19:43 ↗ obligation of the general fund but you

1:19:45 ↗ can see the yellow line is pretty close

1:19:49 ↗ to the baseline because the assumptions

1:19:51 ↗ showed about 1 million in the first year

1:19:56 ↗ and then kind of ramping up to about a

1:19:58 ↗ two million dollar revenue source that

1:20:01 ↗ would help to offset the general fund

1:20:03 ↗ paying the debt obligation so that again

1:20:06 ↗ is a is an upward movement and does not

1:20:09 ↗ impact or or dip into our reserve

1:20:14 ↗ targets and then we have the scenario D

1:20:18 ↗ which was to show that revenues would be

1:20:21 ↗ declining but our expenditures would

1:20:24 ↗ remain the same also shows that we would

1:20:27 ↗ go into an unsustainable mode and that

1:20:31 ↗ certainly as administrator moon

1:20:34 ↗ indicated is that yes the reality would

1:20:36 ↗ be that the council would be reacting to

1:20:39 ↗ offset and reduce expenditures should

1:20:42 ↗ the revenues decline but this was a way

1:20:45 ↗ to depict the scenarios to give try to

1:20:49 ↗ give a good clear understanding about if

1:20:51 ↗ if there was one scenario versus another

1:20:54 ↗ and so I would like to hear feedback and

1:20:58 ↗ certainly questions of the council

1:20:59 ↗ councilmember we're just not thank you

1:21:01 ↗ two questions

1:21:02 ↗ do you recall why did we start scenario

1:21:07 ↗ C when we did it looks from this it's

1:21:13 ↗ almost like next year but I mean that

1:21:18 ↗ wouldn't be we wouldn't do that right it

1:21:20 ↗ would be a couple years down the road

1:21:23 ↗ rather than so immediate

1:21:26 ↗ assumptions showed in the assumption

1:21:28 ↗ that serves 1 million two million so it

1:21:30 ↗ showed an example of and to look at the

1:21:34 ↗ start of the year that we wouldn't have

1:21:37 ↗ we wouldn't just you know it wouldn't be

1:21:39 ↗ a start at the beginning of the year

1:21:40 ↗ calendar year and all of a sudden we we

1:21:42 ↗ knew we were gonna have two million

1:21:44 ↗ dollars that's why I have the million

1:21:45 ↗ two to show that we would not have a you

1:21:48 ↗ know that full source of revenue well

1:21:50 ↗ I'm just saying from this these numbers

1:21:52 ↗ right here see tracks with the baseline

1:21:55 ↗ immediately and it seems to me the new

1:21:58 ↗ revenues would more likely kick in see

1:22:01 ↗ should track with B for a number of

1:22:04 ↗ years before the new revenue kicks in so

1:22:08 ↗ so I basically it looks like we're

1:22:10 ↗ taking some new revenue almost

1:22:12 ↗ immediately with C I'm just thinking it

1:22:14 ↗ was should kick in a little bit later

1:22:16 ↗ does that make sense yes

1:22:18 ↗ so that was my first question but you

1:22:20 ↗ have a response I mean do we provide the

1:22:23 ↗ year as to when it actually was when the

1:22:26 ↗ scenario C revenues were we're kicking

1:22:29 ↗ in it started around if you look about

1:22:31 ↗ 2022 okay so I would expect that C curve

1:22:38 ↗ to take off we should track with the B

1:22:41 ↗ curve all the way to 2022 and then start

1:22:44 ↗ sloping up rather than starting right in

1:22:48 ↗ 2018 so that's that I think it would

1:22:49 ↗ look a little bit different okay but

1:22:53 ↗ think about that I know I fully

1:22:55 ↗ understand okay all right all right then

1:22:58 ↗ the other question is about that

1:23:00 ↗ scenario D it doesn't mcgann it it says

1:23:06 ↗ in the assumptions I guess this is this

1:23:09 ↗ is supposed to be like a 1-year in 2021

1:23:11 ↗ or is this like we go zero looks like we

1:23:14 ↗ go zero in 2018 and just stay zero

1:23:17 ↗ forever in terms of the general economic

1:23:19 ↗ growth and and I wonder see that we

1:23:27 ↗ so this this downturn in 2021 doesn't

1:23:31 ↗ look like it looks like it's a downturn

1:23:32 ↗ starting in 2018 per these numbers that

1:23:35 ↗ are in this chart in front of us now so

1:23:37 ↗ I'm actually looking at the previous

1:23:38 ↗ page and seeing the numbers but looking

1:23:41 ↗ at this chart up here so that down and

1:23:45 ↗ so and so that is a scenario where we

1:23:47 ↗ just have this zero growth forevermore

1:23:51 ↗ okay so that's pretty extreme and I'm

1:23:56 ↗ not sure this model run even reflects

1:23:59 ↗ that oh it does okay it's tracking with

1:24:02 ↗ the until 2021 okay and then then it's

1:24:07 ↗ just assuming from 2021 onwards we're at

1:24:10 ↗ zero okay that one makes it okay now I

1:24:13 ↗ get that one because that one's tracking

1:24:15 ↗ would be as it should until there's a

1:24:16 ↗ turn a downturn okay don't remember hunt

1:24:25 ↗ green lines which are the 15% reserves

1:24:28 ↗ are in the 20% reserve target those are

1:24:31 ↗ the same for all scenarios but in

1:24:34 ↗ reality when they also change because

1:24:38 ↗ the reserve would change with the

1:24:39 ↗ different scenarios well well the reason

1:24:42 ↗ that they're that they're going up it is

1:24:43 ↗ because it's it's based on the

1:24:45 ↗ calculation of the expenditure in that

1:24:47 ↗ year and so the data behind this is is

1:24:50 ↗ calculating 15% of those expenditures

1:24:53 ↗ and those expenditures generally are

1:24:55 ↗ going up three percent so the reserve

1:24:58 ↗ requirement is going up just as it is

1:25:03 ↗ based on on the baseline because they're

1:25:05 ↗ all at three percent right so there's no

1:25:07 ↗ variability and that one and they're all

1:25:10 ↗ at they're all at 15 percent and 20

1:25:13 ↗ percent so so one things that's

1:25:18 ↗ interesting about this is you know I

1:25:20 ↗ feel like this is you know we Jam the

1:25:23 ↗ knobs one way and the JEM knobs the

1:25:25 ↗ other way and see what it sweeps through

1:25:26 ↗ and it's you know it's also thinking

1:25:29 ↗ like okay if I add lots of salt no salt

1:25:32 ↗ lots of pepper no pepper and in the end

1:25:34 ↗ there's give me some combination of salt

1:25:36 ↗ and pepper

1:25:37 ↗ to make a zesty meal and it seems like

1:25:40 ↗ something that sort of qualitatively

1:25:43 ↗ looks something like the scenario B

1:25:46 ↗ outcome right where you get down towards

1:25:48 ↗ some number that is somewhere close to

1:25:51 ↗ where our reserve goals are and that's

1:25:55 ↗ through some combination of what we take

1:25:58 ↗ on council Matic and what we fund with

1:26:01 ↗ alternative revenue sources but you know

1:26:04 ↗ I'm just sort of doing a spoiler alert

1:26:06 ↗ from where I hope we get to down the

1:26:08 ↗ road which is something that looks

1:26:09 ↗ vaguely like this maybe not

1:26:11 ↗ you know quite so beautifully right just

1:26:13 ↗ skimming the 15% line but something that

1:26:17 ↗ looks kind of like this that brings us

1:26:19 ↗ down towards our where we want to get to

1:26:23 ↗ with our ending fund balance and that in

1:26:25 ↗ terms of it

1:26:25 ↗ hockey sticking back up to use a good

1:26:28 ↗ Minnesota term later you know we can

1:26:31 ↗ figure out how to how to deal with that

1:26:33 ↗ as we when when we get to that good one

1:26:36 ↗ of the one of those are the good

1:26:37 ↗ problems to have thank you that I mean

1:26:42 ↗ the the purpose of of the different

1:26:46 ↗ scenarios was to do just that is that

1:26:49 ↗ was there a pathway forward that was

1:26:51 ↗ planned

1:26:52 ↗ and then according to financial policy

1:26:55 ↗ that the council would be adhering to

1:26:57 ↗ that is that you have a planned use of

1:27:00 ↗ your resources your reserves and that

1:27:05 ↗ you have a plan because when we look at

1:27:07 ↗ some of the indicators you would say

1:27:09 ↗ well operating deficits are not a good

1:27:11 ↗ thing however if there is a plan to go

1:27:17 ↗ into the green in this case with the

1:27:19 ↗ colors chosen on the graph is that

1:27:21 ↗ you're you're doing something and you're

1:27:25 ↗ working on issues and this is a

1:27:28 ↗ financial depiction of what happens if

1:27:32 ↗ you issue new debt and that was

1:27:35 ↗ primarily the purpose for coming up with

1:27:38 ↗ these the financial model is to try to

1:27:42 ↗ tackle

1:27:44 ↗ those issues regarding transportation

1:27:46 ↗ sure because because I'll just add at

1:27:49 ↗ some point having a really high ending

1:27:52 ↗ fund balance there's there's a level

1:27:55 ↗ beyond which it's it's it's just bad you

1:27:59 ↗ know bad public policy right because a

1:28:02 ↗ citizen in the city or a business owner

1:28:04 ↗ in the city could come to us and say you

1:28:06 ↗ know if we were at 60% right or some

1:28:10 ↗ some super high number and they're like

1:28:11 ↗ why are you raising so much money and

1:28:14 ↗ not spending it right like you haven't

1:28:17 ↗ all you have options you can take you

1:28:19 ↗ know you've got all this extra money you

1:28:20 ↗ can spend it or you can just not tax us

1:28:22 ↗ and you know collect a little less money

1:28:24 ↗ or slow down your rate of growth of

1:28:26 ↗ taxing and and do that as well so you

1:28:29 ↗ know I do think I have been happy that

1:28:32 ↗ I'm happy that we're above the Green

1:28:34 ↗ Line but you know I I would love us to

1:28:37 ↗ come up with a solution that gets us

1:28:39 ↗ back towards our stated goal I feel like

1:28:41 ↗ every year we talked about this we

1:28:43 ↗ talked about how lucky we are they were

1:28:44 ↗ above the line but you know at some

1:28:46 ↗ point it would be good to do that like I

1:28:49 ↗ said just because residents might feel

1:28:51 ↗ like hey you know what one solution is

1:28:53 ↗ just not taxes so much and of course

1:28:54 ↗ because we have such narrow taxation

1:28:57 ↗ mechanisms in this state and it's so

1:28:59 ↗ draconian to get money back once you

1:29:01 ↗ stop you know once you reduce a revenue

1:29:04 ↗ stream we're always careful not to not

1:29:06 ↗ to do that but it's but having having

1:29:09 ↗ policies that result in a net closer to

1:29:11 ↗ our goal I think is is is the is the

1:29:14 ↗ responsible thing to do with voters

1:29:16 ↗ money other questions oh come of

1:29:21 ↗ interest I well just in general I would

1:29:24 ↗ say that see you see is the scenario

1:29:28 ↗ again if you detach it from 2018 basis

1:29:32 ↗ there and reattach it to be around 2022

1:29:35 ↗ 2023 then that starts to make the most

1:29:38 ↗ sense to me and it in it but it banks

1:29:40 ↗ upon us us kind of basically earning

1:29:45 ↗ some capital in terms of public trust

1:29:47 ↗ and what we can do with transportation

1:29:48 ↗ we're saying without any additional ask

1:29:50 ↗ we're you know we're gonna we're gonna

1:29:52 ↗ take the assets we've already collected

1:29:53 ↗ and

1:29:55 ↗ gonna do some important projects and and

1:29:58 ↗ and it's a little bit of a bat that says

1:30:01 ↗ and and if we do a good job and we think

1:30:05 ↗ we will do a good job then you know

1:30:07 ↗ there will be a better climate for us to

1:30:09 ↗ go ask for some new funding for the

1:30:11 ↗ balance of the unfunded transportation

1:30:14 ↗ projects in our CIP that's what that's

1:30:17 ↗ what scenario C says and I'm interested

1:30:20 ↗ in that scenario at the same time I do

1:30:24 ↗ want to take up the conversation that

1:30:26 ↗ Chris brought up about other portions we

1:30:29 ↗ have other asset classes in our CIP way

1:30:31 ↗ of facilities parks trails and

1:30:32 ↗ transportation and and I don't know if

1:30:36 ↗ we're prepared to have a conversation

1:30:37 ↗ about that tonight but there might be

1:30:38 ↗ good some get someone out onto the table

1:30:41 ↗ to discuss and I'm looking I'm looking

1:30:44 ↗ at the the CIP document right now of the

1:30:48 ↗ and it goes out for you know into the

1:30:50 ↗ future years there's a total of 238

1:30:52 ↗ million of unfunded capital

1:30:55 ↗ transportation is 161 of that 238 and

1:30:59 ↗ parks and trails are a total of 28 out

1:31:02 ↗ of that 238 perhaps we've been making an

1:31:06 ↗ assumption in this that because we've

1:31:09 ↗ been the public has a time and again

1:31:12 ↗ shown a willingness to tax themselves

1:31:16 ↗ for parks and open space acquisition and

1:31:18 ↗ trail related stuff that that as a

1:31:21 ↗ policy would be something that we would

1:31:23 ↗ expect to do in future years as well

1:31:26 ↗ perhaps to cover that on funded portion

1:31:28 ↗ of the capital plan which which I don't

1:31:32 ↗ know so I'm just putting I don't - I'm

1:31:35 ↗ just saying something I want to put any

1:31:36 ↗ words anybody's mouth and then and then

1:31:38 ↗ the facilities part is all in the future

1:31:41 ↗ years which means is out beyond 2022 and

1:31:44 ↗ it is it's unfunded Kippur Shin is 48

1:31:47 ↗ million so that's significantly that's

1:31:49 ↗ twice what the parks and trails is

1:31:51 ↗ almost and I'm not as familiar with that

1:31:54 ↗ because that's actually roll and roll up

1:31:56 ↗ of quite a few of the categories that's

1:31:58 ↗ only for asset classes but we have many

1:32:00 ↗ more categories than that in our CIP

1:32:03 ↗ and I'm not sure we're prepared at all

1:32:05 ↗ to have a more in-depth conversation

1:32:06 ↗ about that tonight but I think it would

1:32:09 ↗ be good to hear if from the

1:32:10 ↗ administration on what the thinking

1:32:13 ↗ might be about that part of the CIP

1:32:15 ↗ because it was it was when we got

1:32:18 ↗ together as the Finance Committee ad-hoc

1:32:21 ↗ committee it was definitely very strong

1:32:24 ↗ direction like let's focus on

1:32:26 ↗ transportation it's the biggest part and

1:32:28 ↗ it's the one that we don't have a track

1:32:32 ↗ record in terms of you know going to ask

1:32:36 ↗ for money for being successful we went

1:32:38 ↗ for the bond and still got 54% but that

1:32:41 ↗ still wasn't successful so and in

1:32:44 ↗ feeling also it reflected what we

1:32:46 ↗ thought was the most urgent need within

1:32:48 ↗ the community and we have a list of

1:32:51 ↗ projects that we think would make a

1:32:52 ↗ difference so let's put the focus of our

1:32:55 ↗ capital and in this whole model on

1:32:57 ↗ transportation but I've said what I

1:33:00 ↗ think maybe about parks and trails and

1:33:02 ↗ what the strategy might be for him

1:33:03 ↗ handling the unfunded portion there I'd

1:33:05 ↗ like to know what others think about

1:33:07 ↗ that and I and I like to hear we'd want

1:33:09 ↗ to get some more back on the facilities

1:33:11 ↗ part and I think we need to get that

1:33:12 ↗ from the administration because I don't

1:33:13 ↗ think we've ever talked about that so so

1:33:15 ↗ I want to be clear on one thing the a be

1:33:17 ↗ that impaneled the ad hoc Finance

1:33:19 ↗ Committee acts actually asked us to look

1:33:21 ↗ specifically at transportation and

1:33:23 ↗ that's why we focused on transportation

1:33:24 ↗ having said that here we are today

1:33:27 ↗ talking about citywide the bigger issues

1:33:29 ↗ and so you know that that's why I had

1:33:32 ↗ Hawk focuses with you thank you yeah you

1:33:35 ↗ know it's this whole conversation is

1:33:37 ↗ gonna be really interesting Paul because

1:33:39 ↗ I understand this idea of maybe starting

1:33:42 ↗ with council Matic and and you know

1:33:44 ↗ building some inertia I also think

1:33:46 ↗ there's a there's an alternate and

1:33:48 ↗ certainly not gonna solve it here

1:33:50 ↗ tonight but there's an alternate thing

1:33:51 ↗ that says if you know what you need to

1:33:52 ↗ do to start transport to get to address

1:33:54 ↗ transportation get cracking right and

1:33:56 ↗ use all the tools that are arsenal to

1:33:59 ↗ address it right I'm not sure that's the

1:34:01 ↗ right way to do it but you know I could

1:34:03 ↗ see somebody saying that somebody's

1:34:04 ↗ saying look you know we've said

1:34:06 ↗ transportations the thing just get going

1:34:08 ↗ do everything you can find every nickel

1:34:10 ↗ in every cushion in every couch

1:34:13 ↗ everywhere and and go do it so it'll be

1:34:16 ↗ interesting to figure out how how we

1:34:17 ↗ want to how we want to pursue that

1:34:19 ↗ Christian did you have something resin

1:34:21 ↗ no sorry okay other questions comments

1:34:25 ↗ and we're looking for other thoughts all

1:34:33 ↗ right

1:34:38 ↗ alright I'm just gonna quickly go

1:34:41 ↗ through because like I said that this

1:34:43 ↗ this page was was probably a page that

1:34:46 ↗ we could have just had maybe a smaller

1:34:48 ↗ packet and we could have talked

1:34:51 ↗ specifically about the model but the

1:34:53 ↗ again the this information is intended

1:34:55 ↗ to provide you with with a lot of detail

1:34:59 ↗ as we go into the the budget discussion

1:35:03 ↗ so thank you

1:35:03 ↗ council president marks for talking

1:35:05 ↗ about will continue the discussions on

1:35:11 ↗ revenue sources and capital expenditures

1:35:14 ↗ that might be made I want to then jump

1:35:18 ↗ to financial indicators because this is

1:35:21 ↗ this is where we are getting into kind

1:35:24 ↗ of testing how we're doing and so one of

1:35:28 ↗ the things that I wanted to point out is

1:35:30 ↗ that financial can our financial

1:35:34 ↗ condition is obviously something that we

1:35:39 ↗ want to make sure that we have the

1:35:41 ↗ ability to maintain existing levels of

1:35:44 ↗ service and that there are there are

1:35:47 ↗ things that impact there are local and

1:35:49 ↗ regional economic disruptions that often

1:35:53 ↗ get in the way of what we need to do to

1:35:57 ↗ meet demands and so what we wanted to

1:36:00 ↗ put together and this is the same as

1:36:02 ↗ last year but if you remember that these

1:36:04 ↗ were the large pages again which we

1:36:06 ↗ shrunk these down and pointed out some

1:36:11 ↗ retrospective and historical information

1:36:13 ↗ about where we've been and I'm going to

1:36:15 ↗ talk about each of the the indicators

1:36:18 ↗ that we have developed information for I

1:36:21 ↗ also just wanted to point out that there

1:36:24 ↗ are a number more indicators that are in

1:36:30 ↗ that would impact our environmental and

1:36:32 ↗ organizational factors that contribute

1:36:34 ↗ to our financial condition so that would

1:36:36 ↗ answer perhaps comes whenever

1:36:40 ↗ winter stands comment about

1:36:43 ↗ non-financial and so I just wanted to

1:36:46 ↗ make that point that those are in the

1:36:50 ↗ overall kind of matrix and I'll walk

1:36:53 ↗ through that we're in the process of

1:36:54 ↗ compiling this information and just kind

1:36:58 ↗ of wanted to let you know that how you

1:36:59 ↗ would read the the first page is that

1:37:02 ↗ we've done some work on the indicators

1:37:04 ↗ one two three six and partial of seven

1:37:07 ↗ we continue to add data to our our

1:37:13 ↗ master data and will continue to then go

1:37:17 ↗ out and look for comparative information

1:37:20 ↗ from other communities as well so

1:37:23 ↗ nonetheless I wanted to just briefly go

1:37:26 ↗ over that our indicators are based on

1:37:29 ↗ our baseline right now and certainly as

1:37:34 ↗ the council makes decisions then what we

1:37:35 ↗ do is we go back and we put that that

1:37:38 ↗ forecast or that those those assumptions

1:37:40 ↗ of the council or those decisions of the

1:37:42 ↗ council in and it serves as a test on

1:37:44 ↗ whether or not we're going to be

1:37:46 ↗ performing better or worse and helps us

1:37:51 ↗ take a a longer look at our financial

1:37:54 ↗ condition so what I wanted to point out

1:37:57 ↗ on page let's say I'm just trying to get

1:38:00 ↗ page numbers here on page 107 of the

1:38:05 ↗ packet that just kind of shows that flow

1:38:07 ↗ of some of those environmental factors

1:38:11 ↗ that impact our financial condition

1:38:16 ↗ there's organizational factors and then

1:38:18 ↗ there's certainly the financial factors

1:38:19 ↗ and we we the easy ones are the

1:38:21 ↗ financial factors because we we do

1:38:23 ↗ collect data and and we do want to

1:38:25 ↗ present it in a way that is helpful for

1:38:27 ↗ the council and then you see way up

1:38:30 ↗ above you can see those early warning

1:38:32 ↗ trends and you can see some of those

1:38:35 ↗ early warning trends are and I'll go

1:38:37 ↗ through those in the indicators that we

1:38:38 ↗ have prepared and and what you would

1:38:42 ↗ look for but it's intended to help the

1:38:44 ↗ council with decision making

1:38:48 ↗ and I have a description of each of the

1:38:50 ↗ indicators so if there isn't any

1:38:53 ↗ questions about the the overall plan for

1:38:56 ↗ putting a tool in place and continuing

1:38:58 ↗ to use it I'll go on with the indicators

1:39:02 ↗ the first one is revenue per capita and

1:39:05 ↗ so examining our revenue per capita and

1:39:09 ↗ this is the this is in comparison so per

1:39:11 ↗ capita is relative to the change in

1:39:13 ↗ population and the rate of inflation and

1:39:17 ↗ you can see historically that we have

1:39:20 ↗ had increasing net operating revenues

1:39:23 ↗ per capita and so you can see at the top

1:39:25 ↗ the warning trend would be is that if

1:39:26 ↗ they were decreasing because that would

1:39:29 ↗ mean is if our revenues were going down

1:39:31 ↗ per capita that means that we're not

1:39:33 ↗ able to maintain those existing levels

1:39:35 ↗ of service we would need to find new

1:39:37 ↗ sources of revenue or or certainly ways

1:39:41 ↗ to save money on the expenditure side

1:39:43 ↗ but it assumes that that the cost of

1:39:47 ↗ service is directly related to

1:39:48 ↗ population size and so we've put

1:39:51 ↗ together the data in the historical

1:39:54 ↗ information you can see how the numbers

1:39:56 ↗ play out these are actual numbers from

1:39:57 ↗ our audited financial statements the the

1:40:01 ↗ CPI and then we just we just do the math

1:40:04 ↗ and the population then creates that per

1:40:07 ↗ capita revenue and you so you can see

1:40:10 ↗ that is increasing historically Hausner

1:40:14 ↗ would just I'm Thank You Jen what type

1:40:19 ↗ of revenue are we talking about this is

1:40:22 ↗ just general fund so this is just

1:40:24 ↗ general this is just okay we can do we

1:40:27 ↗ could do any indicators on the different

1:40:30 ↗ types of revenues so if we were going to

1:40:31 ↗ look at this from a utility perspective

1:40:33 ↗ then you know those would be those rates

1:40:35 ↗ and the capital contributions I just

1:40:37 ↗ didn't see I thought that maybe it was

1:40:39 ↗ but I didn't see any where I know that's

1:40:41 ↗ primarily been our context tonight has

1:40:43 ↗ been general fund but I didn't I didn't

1:40:46 ↗ see that on there say specifically

1:40:48 ↗ general fund so thank you for that

1:40:50 ↗ tell me about transfers but when we're

1:40:55 ↗ talking about the general fund and

1:40:56 ↗ transfers what do you what would we be

1:40:59 ↗ referring to

1:41:00 ↗ what we referred to there is because in

1:41:03 ↗ fund accounting one fund transfers money

1:41:06 ↗ to another so we also include those

1:41:09 ↗ transfer dollars now some you might

1:41:12 ↗ think maybe a special revenue fund was

1:41:15 ↗ entrace fer some dollars into the

1:41:17 ↗ general fund because of some some

1:41:19 ↗ condition but we we want to be made

1:41:22 ↗ known that we are including transfers in

1:41:24 ↗ the the net operating revenues could you

1:41:29 ↗ give me an example of this example a

1:41:33 ↗ transfer into the general fund yeah

1:41:36 ↗ transfer into the general fund could be

1:41:39 ↗ from let's just and this is hard because

1:41:44 ↗ when we when we did our fund accounting

1:41:46 ↗ cleanup we shifted and we created

1:41:48 ↗ special revenue funds specifically for

1:41:52 ↗ like REIT so for example if you would

1:41:54 ↗ have the project that the general fund

1:41:58 ↗ was the project was left out of the

1:42:00 ↗ general fund so all the transactions

1:42:02 ↗ were being you know tracked in the

1:42:06 ↗ general fund but there was a source of

1:42:08 ↗ revenue that that was going to come from

1:42:10 ↗ readers were going to come from another

1:42:12 ↗ special revenue fund that we would

1:42:13 ↗ transfer in that revenue to tackle that

1:42:15 ↗ that one-time capital project so there's

1:42:20 ↗ not a lot of transfers that come into

1:42:21 ↗ the general fund right we're often

1:42:24 ↗ feeding other funds with general funds

1:42:26 ↗ so transfers as a percent I mean how

1:42:30 ↗ what percent is this above the total

1:42:34 ↗ revenue I'm gonna have to get you that

1:42:36 ↗ just get apart I don't want to guess

1:42:38 ↗ less than five I'm not a guess there one

1:42:40 ↗ could we provide that back okay sorry

1:42:43 ↗ they just said something which I was

1:42:45 ↗ wondering if this was true you said this

1:42:47 ↗ it's not common to transfer from other

1:42:50 ↗ funds in the general and yet you have a

1:42:51 ↗ title to your net operating revenues and

1:42:53 ↗ transfers like transfers had some

1:42:56 ↗ significance I just wasn't aware of what

1:42:58 ↗ that was so there was significance in in

1:43:01 ↗ 2007

1:43:02 ↗ tene because there was a million dollar

1:43:04 ↗ transfer from the because of the Malheur

1:43:08 ↗ bait property and so there there was a

1:43:11 ↗ transfer into the general fund so yeah

1:43:13 ↗ transaction that confuses us constantly

1:43:16 ↗ it never stops confusing us okay

1:43:18 ↗ it is a very complicated project the

1:43:21 ↗ purchase okay so so I'm can I'm confused

1:43:28 ↗ by this first that first off are these

1:43:31 ↗ in real dollars are actual dollars

1:43:34 ↗ revenue no I know they're actual dollars

1:43:37 ↗ are they in real dollars in other words

1:43:38 ↗ have you corrected are these in 2017

1:43:41 ↗ dollars all back NPV to current they are

1:43:47 ↗ they are real so in what year are they

1:43:51 ↗ then are they they're in 2017 dollars

1:43:53 ↗ they're in 2013 dollars what are they in

1:43:54 ↗ they are the actual for that year these

1:43:57 ↗ are the audited financial statement

1:43:59 ↗ that's not what I mean by real dollars I

1:44:00 ↗ mean for is it corrected for a certain

1:44:03 ↗ year's currency because they were

1:44:05 ↗ because they were in the past on the big

1:44:07 ↗ spreadsheet they were corrected for

1:44:10 ↗ inflation basically because otherwise

1:44:12 ↗ what I have to do here is I have to take

1:44:14 ↗ these numbers then I have to compare it

1:44:15 ↗ to the CPI and eyeball it myself right

1:44:17 ↗ what you want to do is you want to

1:44:19 ↗ divide these numbers out by the CPI to

1:44:21 ↗ get real dollars right I think so take

1:44:26 ↗ that as an for an offline I believe on

1:44:29 ↗ the bricks down the big spreadsheet we

1:44:31 ↗ corrected for two things we corrected

1:44:32 ↗ for population and then we corrected for

1:44:34 ↗ inflation right which should have given

1:44:36 ↗ us per capita in real dollars right not

1:44:40 ↗ just per capita because the thing that

1:44:42 ↗ the thing that I'm confused about and

1:44:44 ↗ I'm not ready to be I'm not ready to say

1:44:46 ↗ I'm alarmed yet but I thought that at

1:44:49 ↗ least before last year the big chart

1:44:51 ↗ showed is essentially flat in revenues

1:44:53 ↗ more or less in revenues per capita in

1:44:55 ↗ real dollars over time and this the the

1:44:59 ↗ first three years of this chart is

1:45:01 ↗ anything but right the the actual

1:45:04 ↗ operating revenue goes up 19.4% the

1:45:07 ↗ operating revenues transfer per capita

1:45:09 ↗ goes up by 17 percent meanwhile the CPI

1:45:11 ↗ only goes up by three point eight

1:45:13 ↗ percent I don't think that's what

1:45:15 ↗ previous years what we call the big

1:45:17 ↗ chart showed I think it showed over a

1:45:19 ↗ reasonable length timeline that those

1:45:22 ↗ numbers were flat because if those

1:45:23 ↗ numbers aren't flat then it means that

1:45:26 ↗ the cost of governance in the city is

1:45:27 ↗ going up even even taking into account

1:45:30 ↗ the fact that we get economies of scale

1:45:33 ↗ and some of our operations right some of

1:45:35 ↗ the things we do we can do with a larger

1:45:37 ↗ population that's harder to do with a

1:45:38 ↗ smaller population so you should at

1:45:40 ↗ least be staying flat in that kind of a

1:45:43 ↗ measure and it was in the big in the big

1:45:45 ↗ chart that we did in previous years but

1:45:47 ↗ it's not here so again I don't want to

1:45:50 ↗ say I'm alarmed yet but I want to say I

1:45:52 ↗ absolutely need to understand better

1:45:54 ↗ corrected for real dollars corrected for

1:45:56 ↗ inflation so so again divided by

1:45:58 ↗ population divided by inflation so that

1:46:01 ↗ we see what the real cost of governance

1:46:03 ↗ is over time so these are these are

1:46:06 ↗ revenues just revenues mm-hmm so I think

1:46:10 ↗ we can take a deeper dive than in on

1:46:12 ↗ your your view of last year as compared

1:46:18 ↗ to this year well the big chart that we

1:46:20 ↗ did did it for like 10 years right we

1:46:22 ↗ looked you have to be careful just

1:46:24 ↗ looking for three or four years right

1:46:25 ↗ you have to you have to take sort of

1:46:27 ↗ when we did it before we looked at a

1:46:29 ↗ longer timeline so you smoothed out sort

1:46:31 ↗ of local variations because you can get

1:46:33 ↗ little local blips that'll make things

1:46:35 ↗ look weird but both revenues and

1:46:38 ↗ expenditures in per capita real dollars

1:46:42 ↗ were essentially flat and that's what

1:46:44 ↗ made me comfortable with a lot of the

1:46:46 ↗ things we were doing this was two years

1:46:48 ↗ ago the conversation because it made me

1:46:51 ↗ say I could go to a resident in the city

1:46:53 ↗ and say the cost of government for you

1:46:55 ↗ isn't any worse you know the cost of

1:46:57 ↗ government for your yeah we're in any

1:47:00 ↗ worse for you than it was 10 years ago

1:47:01 ↗ right if I can't say that then I have to

1:47:05 ↗ ask myself a whole bunch of questions

1:47:09 ↗ that I want to have to ask myself about

1:47:11 ↗ the way that we're choosing to generate

1:47:14 ↗ and spend money and that was the whole

1:47:17 ↗ purpose of that of that big spreadsheet

1:47:20 ↗ and and so that's what that's why I need

1:47:23 ↗ to know a lot better about this per

1:47:26 ↗ capita in real dollars over a longer

1:47:28 ↗ time lines and

1:47:29 ↗ make sure that we don't have a problem

1:47:30 ↗ because this if I just looked at this

1:47:32 ↗ the fact that I mean he got allocate

1:47:35 ↗ expenditures also but in you want all

1:47:38 ↗ that stuff to track you want to say

1:47:40 ↗ we're asking of the people comparable

1:47:42 ↗ that we asked to the people ten years

1:47:43 ↗ ago we're spending comparable for people

1:47:46 ↗ that we were spending ten years ago and

1:47:47 ↗ you correct that for a population and

1:47:49 ↗ inflation will bring back the big all of

1:47:52 ↗ the data and so you can look at it in

1:47:54 ↗ that framework because we're looking at

1:47:57 ↗ the historical here and then we're

1:47:58 ↗ looking at the next page we're looking

1:48:00 ↗ at the forecast so we will certainly

1:48:03 ↗ include that when we have budget

1:48:06 ↗ discussions great okay that would help

1:48:08 ↗ me and and and I believe it'll show

1:48:11 ↗ things better than I'm envisioning them

1:48:12 ↗ in my head just looking at this one page

1:48:14 ↗ okay thanks oh then I'm just gonna move

1:48:23 ↗ on through then the revenues per capita

1:48:25 ↗ this is the projected this is this is

1:48:27 ↗ coming then from that moving forward

1:48:30 ↗ with the same information and and then

1:48:34 ↗ based on the baseline assumptions

1:48:42 ↗ the indicator to which is expenditures

1:48:45 ↗ per capita I do want to point out that

1:48:47 ↗ the warning trend would be this was a

1:48:49 ↗ correction and it is in the page 111

1:48:53 ↗ replacement that was supplemental

1:48:55 ↗ materials this was a typing error and it

1:49:01 ↗ should say increasing that operating

1:49:03 ↗ revenue expenditures per capita

1:49:06 ↗ obviously with changing expenditures if

1:49:10 ↗ expenditures are going up relative to

1:49:12 ↗ population changes that that would mean

1:49:15 ↗ that the cost of providing services is

1:49:18 ↗ outstripping the ability the community's

1:49:20 ↗ ability to pay it also indicates - if

1:49:24 ↗ there is an increase in spending that

1:49:27 ↗ can be greater than accounted for then

1:49:30 ↗ the inflation or the addition of new

1:49:33 ↗ services and here's the replacement page

1:49:37 ↗ to show the warning trend would be

1:49:39 ↗ increasing net operating expenditures

1:49:44 ↗ per capita again we showed the same

1:49:47 ↗ information from a historical

1:49:49 ↗ perspective from 2013 as council

1:49:54 ↗ president Mart's indicated last year's

1:49:57 ↗ sheets had information that had a

1:50:02 ↗ significantly more historical data in

1:50:05 ↗ there and so our shift to move some

1:50:09 ↗ things around we will again do that

1:50:12 ↗ deeper dive but you can see in the

1:50:14 ↗ expenditures again when we try to depict

1:50:17 ↗ that in charts we show per household and

1:50:21 ↗ per capita pretty much the same in in

1:50:25 ↗ changing from expended one year to the

1:50:29 ↗ next there was a question by a

1:50:31 ↗ councilmember ray with regards to what

1:50:34 ↗ happened in 2021 I provided an

1:50:38 ↗ explanation on that this was some of the

1:50:41 ↗ impact of our debt obligation our annual

1:50:44 ↗ debt obligation dropping off and

1:50:49 ↗ the then the the general economic change

1:50:52 ↗ in expenditures is 3% so we don't have a

1:50:55 ↗ full three percent year-over-year so in

1:50:59 ↗ a couple of years we have about two

1:51:02 ↗ percent and so we have population

1:51:04 ↗ changes increasing at the two percent

1:51:06 ↗ level and so all of a sudden we have

1:51:08 ↗ this blip in that third year because our

1:51:11 ↗ debt service has dropped down in the and

1:51:14 ↗ the change year over over a year is not

1:51:16 ↗ apples to apples again like I indicated

1:51:19 ↗ in my response and if this had been

1:51:22 ↗ extended out into 2023 we would see

1:51:26 ↗ another funky change in expenditures for

1:51:32 ↗ per capita expenditures and per

1:51:34 ↗ household expenditures to go upward

1:51:37 ↗ similar to 2021 so so we are seeing so

1:51:43 ↗ the sign that says warning trend would

1:51:45 ↗ be increasing that operating expenses

1:51:47 ↗ per capita and that's exactly what we're

1:51:48 ↗ seeing so we've got the warnings that we

1:51:51 ↗ have warning sign mm-hmm okay yes and

1:51:55 ↗ and so per capita expenditures over four

1:51:59 ↗ years have gone up 26% but CPI is only

1:52:02 ↗ gone up ten point three percent so we're

1:52:04 ↗ outpacing inflation so that's

1:52:08 ↗ hypothetically a problem again it looks

1:52:14 ↗ different than when we talked about this

1:52:16 ↗ either a year two ago but this concerns

1:52:19 ↗ me it's noted and we'll go back and make

1:52:23 ↗ sure that the information provided and

1:52:25 ↗ what changed in these in this depiction

1:52:35 ↗ other questions all right indicator 3 is

1:52:41 ↗ operating deficits the warning trend is

1:52:43 ↗ increasing general fund operating

1:52:44 ↗ deficits I talked a little bit about

1:52:46 ↗ this when we were looking at the

1:52:49 ↗ financial model when we were looking at

1:52:52 ↗ scenario B that it would look like it

1:52:58 ↗ was an operating deficit again this

1:53:03 ↗ occurs when expenditures are exceeding

1:53:06 ↗ revenues it doesn't mean that the budget

1:53:08 ↗ is out of balance because reserves are

1:53:10 ↗ used because reserves are a source to be

1:53:14 ↗ used to fund services and so it does

1:53:19 ↗ mean that in a current year it doesn't

1:53:22 ↗ mean that the government is spending

1:53:24 ↗ more than its receiving there could be

1:53:27 ↗ things like an emergency in one year and

1:53:30 ↗ then not the next but for the most part

1:53:34 ↗ is that an operating deficit in one year

1:53:37 ↗ is not a cause for concern it's when it

1:53:40 ↗ happens over multiple years and there's

1:53:42 ↗ not a plan in place and the council does

1:53:45 ↗ again as I stated have financial policy

1:53:49 ↗ that identifies how you handle operating

1:53:52 ↗ deficits over time how you handle

1:53:56 ↗ spending reserves or bringing reserves

1:53:59 ↗ back up into your into your policy

1:54:02 ↗ targets and so this is something that I

1:54:06 ↗ wanted to point out too with regards to

1:54:08 ↗ credit raging firms when they look at

1:54:12 ↗ operating deficit it's certainly a minor

1:54:15 ↗ warning signal but then they would at be

1:54:18 ↗ asking for a plan and so certainly any

1:54:22 ↗ large deficit more than more than 10%

1:54:25 ↗ would also be something that the credit

1:54:28 ↗ raiders would ask for more information

1:54:32 ↗ about so I'm sorry what assumptions are

1:54:39 ↗ we using why why are we seeing a change

1:54:45 ↗ out at 20 20 20

1:54:47 ↗ 20:22 because if you if you if you

1:54:50 ↗ append the projected on to the

1:54:52 ↗ historical for most of this you get sort

1:54:54 ↗ of a little back and forth oscillation

1:54:57 ↗ of some kind but then you get this you

1:54:59 ↗ get this step out around 2020 and all of

1:55:01 ↗ a sudden you're above zero and you stay

1:55:03 ↗ above zero what's that about

1:55:05 ↗ well one of the one of the things that

1:55:08 ↗ we talked about was the where our debt

1:55:11 ↗ service starts starts to be reduced and

1:55:13 ↗ so this does not include the any new

1:55:18 ↗ debt right now this is just a look at

1:55:21 ↗ where we pelvis right that should make

1:55:23 ↗ it better and that's why you see the

1:55:25 ↗ operating deficits on the projected side

1:55:27 ↗ going out going above the negative sorry

1:55:32 ↗ an operating deficit is a good thing

1:55:34 ↗ the well I'm not saying the operating

1:55:37 ↗ deficit is a good thing this is just how

1:55:39 ↗ we're looking at this indicator based on

1:55:42 ↗ the operating deficit revenues over

1:55:44 ↗ expenditures and every year so as we go

1:55:47 ↗ into the outer years in the baseline

1:55:50 ↗ that that the the color I'm going to go

1:55:55 ↗ back to the color of the line there was

1:55:58 ↗ no operating deficit in some of those

1:56:00 ↗ years in the outer ears now I'm super

1:56:02 ↗ confused deficit so a positive number

1:56:04 ↗ means a deficit or does it positive

1:56:07 ↗ number mean a surplus the positive

1:56:09 ↗ number means a surplus thank you okay

1:56:12 ↗ now I get it

1:56:13 ↗ so rising surpluses would be a warning

1:56:16 ↗ sign no it would not be a warning sign

1:56:20 ↗ it would be the the warning would be

1:56:23 ↗ that if we continued to be in the

1:56:25 ↗ negative then that would be problematic

1:56:27 ↗ but in this case our current our current

1:56:31 ↗ revenues over expenditures forecast

1:56:34 ↗ shows that we would not have we would

1:56:37 ↗ not have operating deficits so therefore

1:56:40 ↗ there would be no warning right okay

1:56:43 ↗ nothing to warn us I would heartily

1:56:44 ↗ encourage either calling this operating

1:56:46 ↗ surpluses or inverting the graph right

1:56:49 ↗ because the title on the thing is the

1:56:51 ↗ positive value of the thing right and

1:56:53 ↗ this is not a measure of operating

1:56:56 ↗ deficits as a measure of operating

1:56:58 ↗ surpluses right

1:56:59 ↗ this is a measure of operating deficits

1:57:03 ↗ because that is that is the warning but

1:57:06 ↗ in this case in this in these scenarios

1:57:08 ↗ in these forecasts we do not have one so

1:57:11 ↗ certainly I think this is the how the

1:57:15 ↗ indicator Jennifer let me tell you as a

1:57:18 ↗ math person the warning says increasing

1:57:21 ↗ increasing in this chart is not a bad

1:57:23 ↗ thing decreasing is a bad thing

1:57:25 ↗ so something some combination of the

1:57:27 ↗ warning sign and the title of the chart

1:57:29 ↗ and what whether you choose to invert

1:57:32 ↗ the chart or not but anybody that is not

1:57:34 ↗ a map person or not a finance person is

1:57:36 ↗ going to be very confused by this okay

1:57:37 ↗ I'm quite confident that that's the case

1:57:39 ↗ because you see the increasing write on

1:57:42 ↗ the warning as this number is increasing

1:57:44 ↗ and that's actually a good thing right

1:57:46 ↗ but it took some time for me to work

1:57:48 ↗ through what that was so I just ask that

1:57:49 ↗ you consider whether there's some

1:57:51 ↗ combination of how we word this and how

1:57:53 ↗ we show this that makes it more clear

1:57:55 ↗ for anybody who's going to take a look

1:57:57 ↗ at this because I'm sure if I'm confused

1:57:59 ↗ there will be other people working we

1:58:00 ↗ will work on depicting it in a better

1:58:02 ↗ manner and a better framework for the so

1:58:04 ↗ that the community can understand it

1:58:05 ↗ Thanks before we move on

1:58:07 ↗ Toula could you explain it to me so I

1:58:09 ↗ can understand yeah I really understand

1:58:13 ↗ I'm not tracking you sure so above the

1:58:16 ↗ nice and calm

1:58:17 ↗ above the line is a surplus at which

1:58:19 ↗ chart page which are you looking at I'm

1:58:20 ↗ gonna make sure I'm in the right age 114

1:58:23 ↗ right operating deficits historical is

1:58:26 ↗ the top charge so above the line is the

1:58:28 ↗ surplus which chart are you on the top

1:58:29 ↗ one the top one either they're both the

1:58:32 ↗ same for both of them above zero is a

1:58:34 ↗ surplus below zero is a deficit so when

1:58:39 ↗ you go back one page to increasing

1:58:41 ↗ general fund deficits as a percentage of

1:58:44 ↗ net operating revenues that would be a

1:58:45 ↗ warning trend right what that means okay

1:58:48 ↗ wait hold on okay moving on warning

1:58:50 ↗ trend would be increasing general fund

1:58:52 ↗ operating deficits so the deficit is

1:58:54 ↗ increasing if the deficit is increasing

1:58:57 ↗ that's a warning sign so I so okay it's

1:58:59 ↗ a-okay it's right that's right

1:59:04 ↗ what's that that's a deficit that's

1:59:06 ↗ growing right value is getting large yes

1:59:10 ↗ so so it means a chart that is it has an

1:59:12 ↗ increasingly negative value that's what

1:59:14 ↗ means going further into deficit that's

1:59:17 ↗ right right okay all right okay so and

1:59:21 ↗ so what is your concern my concern is

1:59:24 ↗ that first of all if I see something

1:59:27 ↗ that's titled deficits I'm used to the

1:59:31 ↗ the title of a chart being a the

1:59:34 ↗ positive value of something and secondly

1:59:36 ↗ is it if I see increasing I think well

1:59:41 ↗ it's increasing so so we've got a

1:59:43 ↗ problem

1:59:43 ↗ you lost me right there where are you

1:59:44 ↗ seeing the word increasing what are you

1:59:46 ↗ talking about under the warning trend

1:59:47 ↗ would be says increasing general fund

1:59:49 ↗ operating deficits yep you're free to

1:59:53 ↗ disagree with my date with my understand

1:59:56 ↗ what it was so what's the problem with

1:59:57 ↗ that phrase increasing deficits because

1:59:59 ↗ I look at that chart and that charts

2:00:01 ↗ increasing so we've got a problem no no

2:00:04 ↗ it doesn't it's not increasing it did

2:00:06 ↗ from 13 to 14 the deficit increased and

2:00:09 ↗ it took a little dip in 15 to 16 but

2:00:12 ↗ it's but the value of the chart is

2:00:16 ↗ increasing over time moving up into the

2:00:18 ↗ right yeah growing I know that okay okay

2:00:25 ↗ again you're free disagree with my

2:00:27 ↗ concern well I hear what you're saying

2:00:30 ↗ now yeah I don't this you don't yeah I

2:00:36 ↗ see that this I know that a growing

2:00:38 ↗ negative number would be a bad thing

2:00:40 ↗ we're not seeing a growing negative

2:00:41 ↗ number gotcha

2:00:42 ↗ so that's good right council member ray

2:00:47 ↗ Jen thank you very much for your earlier

2:00:49 ↗ responses to my questions that we're

2:00:51 ↗ real helpful the one that I do want to

2:00:52 ↗ kind of dive a little bit into is is

2:00:55 ↗ here because in our projections for 18

2:00:58 ↗ we're showing a deficit of nine hundred

2:01:01 ↗ twenty three thousand dollars and right

2:01:03 ↗ now where we have a surplus of 1.2

2:01:05 ↗ million dollars and so I understand that

2:01:08 ↗ there's some guidance that's driving

2:01:09 ↗ that number I just like to understand

2:01:11 ↗ the guidance of why we why we're going

2:01:14 ↗ to have why we have the discrepancy

2:01:15 ↗ between what we're seeing you know what

2:01:16 ↗ we're

2:01:17 ↗ um the we could have we could have

2:01:22 ↗ multiple charts than to show the the

2:01:24 ↗ operating deficits or surpluses or or

2:01:28 ↗ how it's depicted up into the right yes

2:01:31 ↗ based on the budget based on the

2:01:33 ↗ council's expectation that there would

2:01:35 ↗ be an operating deficit in 2018 we could

2:01:40 ↗ also show then and I think it's

2:01:43 ↗ something that will be an important

2:01:46 ↗ piece as we get better depiction of this

2:01:48 ↗ is that when we start to forecast the

2:01:51 ↗ year on 2018 we can show the same chart

2:01:56 ↗ inverted to show how what were what

2:02:00 ↗ we're forecasting for the operating

2:02:01 ↗ deficits so I think will will properly

2:02:05 ↗ identify what is what is the budget

2:02:09 ↗ versus forecast then as we bring back

2:02:12 ↗ more information other questions

2:02:21 ↗ okay thank you indicator six this is

2:02:26 ↗ capital outlay this is one that commonly

2:02:33 ↗ and and again this is this is general

2:02:36 ↗ fund capital outlay but this is just

2:02:40 ↗ another indicator that in the warning

2:02:43 ↗ trend would be that three or more year

2:02:46 ↗ decline in capital outlay might mean

2:02:49 ↗ that there are some challenges with

2:02:52 ↗ keeping up with vehicle and equipment

2:02:56 ↗ and the maintenance of that referred to

2:02:58 ↗ as maybe capital outlay so we've

2:03:03 ↗ replacing items in the general fund or

2:03:07 ↗ capital outlay items that do not make

2:03:09 ↗ the CIP that is something that we wanted

2:03:12 ↗ to show historically on the the second

2:03:15 ↗ chart is where we wanted to depict CIP

2:03:18 ↗ and so this is one that is to show that

2:03:24 ↗ we're we're working towards putting

2:03:26 ↗ together these tools and to let the

2:03:31 ↗ council see the see the portion that has

2:03:35 ↗ been identified for total capital outlay

2:03:38 ↗ it is rather all over the place but

2:03:42 ↗ nonetheless it's something that can help

2:03:46 ↗ to test how we're doing in our financial

2:03:50 ↗ condition because our smaller assets are

2:03:53 ↗ important as well as the bigger objects

2:03:57 ↗ that are in CIP and then the final

2:04:02 ↗ indicator so you can ask a question so

2:04:05 ↗ this is another one that if you tie

2:04:06 ↗ together the historical would be

2:04:08 ↗ projected like if I just look at the

2:04:10 ↗ historical I go oh I think we may have

2:04:12 ↗ that warning trend right but if you tie

2:04:15 ↗ it together with the projected what you

2:04:17 ↗ get is sort of a back and forth squiggle

2:04:19 ↗ a little bit right and so it's not

2:04:21 ↗ necessarily I guess it's still is it

2:04:29 ↗ still generally coming down there's high

2:04:31 ↗ there's highs and lows but we go from

2:04:33 ↗ orig

2:04:34 ↗ that's generally in the 1 and a half to

2:04:37 ↗ three percent range to a regime that is

2:04:40 ↗ generally sub 1% right so would you say

2:04:44 ↗ that that warning trend is is is

2:04:49 ↗ activated on this on this indicator

2:04:53 ↗ administrator moon not yeah not yet I

2:04:56 ↗ think this is a great tool for us to

2:04:58 ↗ just watch over time and make sure we

2:05:01 ↗ are thinking about our replacement of

2:05:03 ↗ smaller capital assets if we go back in

2:05:07 ↗ time beyond 2013 we may see a different

2:05:10 ↗ pattern from year to year you have

2:05:13 ↗ different pieces of equipment that come

2:05:15 ↗ due some might be really big and create

2:05:18 ↗ a little spike on the next year you may

2:05:20 ↗ not have that so there's a good deal of

2:05:23 ↗ variability from year to year I would

2:05:25 ↗ also say in the projection we have some

2:05:28 ↗ work to do

2:05:29 ↗ to make sure that we're forecasting

2:05:30 ↗ accurately into the future for those

2:05:32 ↗ smaller capital needs so as we think

2:05:36 ↗ about our fleet replacement you know how

2:05:39 ↗ we certainly have a schedule but we can

2:05:42 ↗ analyze you know how to spread things

2:05:44 ↗ out in a better way and so I would I

2:05:46 ↗ would expect that we don't fall as lows

2:05:51 ↗ as shown in the projection and that we

2:05:54 ↗ stay somewhere around whatever that

2:05:56 ↗ trend line has been historically but I

2:05:59 ↗ think the purpose of the chart is just

2:06:01 ↗ to be mindful that we we should assume

2:06:04 ↗ that we have an annual obligation to

2:06:06 ↗ keep up with those replacements and then

2:06:08 ↗ if we underfund we're putting service

2:06:12 ↗ delivery at risk

2:06:14 ↗ do we have an idea of what that number

2:06:18 ↗ should be that's an excellent question I

2:06:22 ↗ don't off the top of my head I think we

2:06:24 ↗ do on our on our fleet side and that

2:06:27 ↗ tends to capture

2:06:30 ↗ larger more expensive pieces of

2:06:32 ↗ equipment I don't have that off the top

2:06:34 ↗ of my head and then there's other pieces

2:06:37 ↗ that are part of capital outlay that

2:06:40 ↗ we're developing asset management plans

2:06:42 ↗ for yep other questions

2:06:45 ↗ that's member hunt what are the

2:06:48 ↗ asterisks indicate what are they

2:06:51 ↗ indicate on the years for that one I

2:06:53 ↗ don't see them on the other one excuse

2:06:59 ↗ me this may have been a change in the in

2:07:01 ↗ the formatting and so I'll need to get

2:07:04 ↗ what that note is because that didn't

2:07:07 ↗ get transferred

2:07:16 ↗ their questions right I'm just gonna

2:07:21 ↗ move quickly through the the indicator

2:07:24 ↗ number seven this is property values

2:07:26 ↗ both historical and projected again it's

2:07:30 ↗ based on the assessed valuation these

2:07:35 ↗ are the King County assessed valuations

2:07:39 ↗ from a historical perspective and then

2:07:42 ↗ these are the growth so I'm going to

2:07:43 ↗ shift to page 118 and just point out in

2:07:49 ↗ the the assessed valuation numbers are

2:07:53 ↗ based on what we we are seeing

2:07:59 ↗ historically and what we have that are

2:08:01 ↗ coming from the projects in the pipeline

2:08:03 ↗ and so this is the number where we get

2:08:06 ↗ that that 1% the limitations for in

2:08:10 ↗ order for us to forecast property taxes

2:08:13 ↗ and you can see that the assessed

2:08:14 ↗ valuation in this particular projected

2:08:18 ↗ information is going up and so I just

2:08:22 ↗ wanted to circle back and let you know

2:08:24 ↗ this is the dollar amount where we get

2:08:26 ↗ our property tax estimates going forward

2:08:31 ↗ so I struggle a little bit with this one

2:08:34 ↗ because you could by just putting more

2:08:38 ↗ stuff by having more development swamp

2:08:41 ↗ what's actually going on like I it with

2:08:44 ↗ a measure like this you could have the

2:08:46 ↗ average home sale price be dropping

2:08:49 ↗ right but as long as as long as you are

2:08:52 ↗ growing faster than housing prices are

2:08:55 ↗ dropping you would see a positive number

2:08:56 ↗ so my question is is there any way the

2:08:59 ↗ same way we talked about revenues and

2:09:01 ↗ expenses as per capita in real dollars

2:09:04 ↗ is there some divisor that we can put

2:09:07 ↗ the this is the numerators the divisor

2:09:09 ↗ we can put this over such that we can

2:09:12 ↗ measure how this is for a business that

2:09:16 ↗ has a certain number of square feet or a

2:09:17 ↗ homeowner for a certain risk square feet

2:09:19 ↗ I mean what you what what I'd one in a

2:09:22 ↗ perfect world if I could wave a magic

2:09:23 ↗ wand would be like the value of

2:09:26 ↗ commercial real estate over the

2:09:27 ↗ commercial square feet the value of

2:09:29 ↗ residential

2:09:30 ↗ over the residential square feet right

2:09:32 ↗ and then you would get commercial per

2:09:34 ↗ square foot you'd get residential per

2:09:36 ↗ square foot and then you would really

2:09:38 ↗ experience what I mean we could sort of

2:09:40 ↗ talk about what the average homeowner or

2:09:42 ↗ business owner is experiencing and I

2:09:45 ↗ have no idea if any of that information

2:09:46 ↗ is available or how easy it would be to

2:09:48 ↗ get I don't know just that that that

2:09:51 ↗ would be super we're taking down this

2:09:54 ↗ and again these are indicators that

2:09:56 ↗ we're starting to pull together so that

2:09:59 ↗ we can start having these conversations

2:10:00 ↗ so appreciate that and let's remember

2:10:06 ↗ winter stuff yes so historical that's

2:10:09 ↗ easy to get you just go look it up

2:10:13 ↗ pretty daring to project rising property

2:10:17 ↗ values in the future well this this is

2:10:19 ↗ something that the the crystal ball it's

2:10:22 ↗ it's a hard one to I mean it's it's hard

2:10:24 ↗ to predict these things and so we we

2:10:26 ↗ have to put something out there as a

2:10:27 ↗ starting point as a talking point and

2:10:29 ↗ then we're not afraid to have holes

2:10:32 ↗ punched in our our assumptions over our

2:10:35 ↗ information so yeah it is a risky so why

2:10:40 ↗ why even why look forward at this one I

2:10:43 ↗ mean we know we just we know what's

2:10:45 ↗ happening mm-hmm right because we don't

2:10:50 ↗ there's there's there's so many factors

2:10:53 ↗ in the environment that that drive

2:10:56 ↗ assessed valuations most and I don't

2:11:00 ↗ know how we would manage to a forecast

2:11:03 ↗ of property valuation changes so I think

2:11:10 ↗ tracking it I get tracking it that's

2:11:12 ↗ absolutely fine as a look this is what

2:11:14 ↗ it's okay we've got next year's numbers

2:11:17 ↗ in this is what it is I just don't know

2:11:20 ↗ the value of projecting anything into

2:11:21 ↗ the future in this way because it's a

2:11:23 ↗ major source of revenue and we do want

2:11:27 ↗ to

2:11:27 ↗ something in the financial model that it

2:11:30 ↗ identifies property tax as add is a

2:11:35 ↗ source and the only way that we get

2:11:37 ↗ there is is the you know the formula to

2:11:40 ↗ identify what our annual levy is gonna

2:11:43 ↗ be okay so then I would want to track

2:11:45 ↗ how it's happening care compared to our

2:11:48 ↗ our baseline or our basis that's what I

2:11:52 ↗ want to track hey so you're providing

2:11:55 ↗ the actual but what I want to know is

2:11:57 ↗ what it is to our base sofiane are so

2:11:58 ↗ okay so that makes sense so so so we

2:12:01 ↗ actually if I we this is and this is

2:12:03 ↗ this is not total this is total

2:12:06 ↗ valuation or just like average increase

2:12:09 ↗ this is this is total valuation this is

2:12:12 ↗ okay which it would be averages okay

2:12:17 ↗ yeah so I would think is a key indicator

2:12:19 ↗ I just want to know what is it doing

2:12:22 ↗ compared to what we are in using in our

2:12:24 ↗ forecast if we're using an 8% I already

2:12:27 ↗ ate no 2018 so for we don't know 2019

2:12:31 ↗ yet that's correct right

2:12:33 ↗ okay so let's track how it does compared

2:12:35 ↗ to what's what we forecasted okay other

2:12:41 ↗ questions comes from array um this is

2:12:43 ↗ this is great I just want to start by

2:12:45 ↗ saying this is great stuff since we're

2:12:48 ↗ gonna get back and the routine of doing

2:12:50 ↗ quarterly updates it would be I think

2:12:51 ↗ really useful to see these numbers on a

2:12:55 ↗ quarterly basis instead the anyone

2:12:57 ↗ particularly relates to property because

2:12:59 ↗ it can be an early warning indicator of

2:13:01 ↗ an impending doom if we start to see

2:13:04 ↗ property values tank and we've seen that

2:13:07 ↗ happen before so if we can have a little

2:13:09 ↗ higher level of granularity than just

2:13:11 ↗ the annual numbers I think that would

2:13:12 ↗ provide us all kind of some some good

2:13:15 ↗ early warnings to take some corrective

2:13:17 ↗ action with so but I love this stuff

2:13:24 ↗ other questions

2:13:29 ↗ all right so then let's let's move on

2:13:31 ↗ this is intended of the next session the

2:13:35 ↗ lat the last section is about revenue

2:13:37 ↗ sources and this talks about current

2:13:41 ↗ revenue sources but I also wanted to

2:13:43 ↗ just briefly touch base on some

2:13:46 ↗ information for information purposes

2:13:47 ↗ only was alternative revenue so what I

2:13:51 ↗ wanted to provide for the council here

2:13:53 ↗ is just a look at our current revenue

2:13:56 ↗ sources this is information all city

2:14:00 ↗ funds so this is not only the general

2:14:03 ↗ fund but it also includes all of those

2:14:05 ↗ revenue sources and you can see that

2:14:07 ↗ there's a large portion for charges for

2:14:09 ↗ goods and services because it includes

2:14:10 ↗ the utility funds and that's those

2:14:12 ↗ utility rates that we charge just to go

2:14:15 ↗ back we're on page 119 of the packet of

2:14:17 ↗ information the information in here is

2:14:23 ↗ intended to give you historical actual

2:14:26 ↗ levies that we have received in and then

2:14:31 ↗ we have then the forecasts for the

2:14:35 ↗ different types of revenues that that we

2:14:37 ↗ have put out you can see a number of

2:14:41 ↗ different ways that we've provided this

2:14:44 ↗ information so on the next page 120 you

2:14:47 ↗ can see the authorized levy amounts also

2:14:50 ↗ wanted to provide the council with that

2:14:52 ↗ property tax distribution so when a

2:14:54 ↗ property owner receives their their tax

2:14:57 ↗ bill not all of those monies go to the

2:14:59 ↗ city of Issaquah there is about 10% of

2:15:02 ↗ the property tax that would go to the

2:15:05 ↗ city of Vista that's the blue pie piece

2:15:07 ↗ that's coming out and so we wanted to

2:15:11 ↗ make sure that this information was

2:15:14 ↗ available next page this is the levy

2:15:17 ↗ rates one of the things that I think we

2:15:21 ↗ talked about here but I wanted to kind

2:15:23 ↗ of circle back to was about that when we

2:15:27 ↗ when we predict assessed value and we

2:15:30 ↗ predict what the property tax levy would

2:15:33 ↗ be as the assessed value goes up the the

2:15:37 ↗ the property because we're limited with

2:15:39 ↗ that 1% the actual rate goes down and in

2:15:43 ↗ the chart at the top of the page it

2:15:45 ↗ identifies the the total the dollar for

2:15:50 ↗ in 2018 per thousand and assessed

2:15:53 ↗ valuation I also wanted to shift out

2:15:56 ↗ that there is the general levy or the

2:15:59 ↗ regular tax rate of about 87 cents and

2:16:01 ↗ then you have that access tax rate and

2:16:04 ↗ that's the the voter approved levy that

2:16:06 ↗ does not hit the general fund but it but

2:16:09 ↗ it show you that that when our

2:16:11 ↗ valuations go up and our ability to set

2:16:15 ↗ the property tax rate it is just an

2:16:17 ↗ automatic going downward then I just

2:16:23 ↗ wanted to show you those assessed

2:16:24 ↗ evaluations this is a lot of small

2:16:26 ↗ numbers in a space to show you what

2:16:30 ↗ those actual assessed valuations were as

2:16:32 ↗ well as there's that new construction

2:16:34 ↗ value of about the two hundred and I I

2:16:41 ↗ knew I remembered a number about two

2:16:42 ↗ hundred eighty but that was 2017 in 2018

2:16:47 ↗ we actually had information from King

2:16:51 ↗ County that it did go down some so it is

2:16:54 ↗ one that's hard to predict other

2:16:56 ↗ information then for the council

2:16:59 ↗ historical residential home values and

2:17:02 ↗ at the bottom of the page you can see

2:17:04 ↗ some average valued home and the changes

2:17:08 ↗ year-over-year that's a question about

2:17:10 ↗ that so you've got that that value was

2:17:14 ↗ obtained from Zillow mmm-hmm do we have

2:17:17 ↗ a more rigorous way to get that number

2:17:21 ↗ other than Zillow because I seem to

2:17:23 ↗ recall not necessarily in City Council

2:17:28 ↗ but some question about how Zillow's

2:17:31 ↗ mechanism and whether it's accurate and

2:17:33 ↗ all that kind of stuff and we're working

2:17:35 ↗ on making sure that we have that we have

2:17:38 ↗ the right source so certainly

2:17:41 ↗ something as we continue to build on our

2:17:43 ↗ tools for understanding where we are

2:17:46 ↗ we've been and where we want to go we'll

2:17:48 ↗ continue to have better sources and the

2:17:52 ↗ Multiple Listing Service doesn't make

2:17:54 ↗ that kind of information available well

2:17:56 ↗ they do that make that kind of available

2:17:57 ↗ at the time of this report this is my

2:18:00 ↗ understanding it was what had been used

2:18:01 ↗ in the past and again and we're working

2:18:03 ↗ to strengthen our tools and the

2:18:05 ↗ information that we produce okay I don't

2:18:07 ↗ have anything against Zillow just if

2:18:09 ↗ there's a if there's a more accurate

2:18:10 ↗ mechanism I've just seen Zillow stuff in

2:18:12 ↗ the past that I was sort of a

2:18:13 ↗ head-scratcher it was like I would

2:18:15 ↗ didn't have a lot of confidence and

2:18:16 ↗ there are numbers and then when we go to

2:18:20 ↗ page 122 this is information and does

2:18:24 ↗ some comparisons to other cities what we

2:18:28 ↗ wanted to do is show the the only the

2:18:31 ↗ city portion by community and the change

2:18:35 ↗ in the the rates just a quick snapshot

2:18:40 ↗ of you you can see the city portion and

2:18:44 ↗ the total rate and then the percentage

2:18:46 ↗ of the total and so from 2016 to this

2:18:51 ↗ current year that's at ten percent of

2:18:53 ↗ the total tax bill the city of Issaquah

2:18:56 ↗ collects or that just over a dollar for

2:18:59 ↗ per thousand of assessed valuation you

2:19:02 ↗ can see how we compare two cities from

2:19:04 ↗ Bellevue to Kirkland Redmond Sammamish

2:19:08 ↗ and in smaller communities counts

2:19:12 ↗ remember ray why is our number so low

2:19:14 ↗ because we have our assessed evaluation

2:19:18 ↗ is it is what it is and the property tax

2:19:24 ↗ limitation of 1% and that is I mean that

2:19:31 ↗ that's the math okay I mean I just

2:19:34 ↗ always you know a little bit of

2:19:35 ↗ competition with Sammamish right and and

2:19:37 ↗ they're killing us here and a dollar

2:19:39 ↗ seven now

2:19:40 ↗ it's all in perspective we are not

2:19:44 ↗ aligned no this is so so I was gonna

2:19:48 ↗ come out of this my comments are not

2:19:50 ↗ reflected they're not aimed at what you

2:19:52 ↗ just said but I think this is super

2:19:54 ↗ super important and I'm just gonna get

2:19:56 ↗ on a on a high hog here just for 60

2:19:59 ↗ seconds this is the flipside of all the

2:20:04 ↗ traffic and concerns that our community

2:20:07 ↗ has had around growth over the last

2:20:10 ↗ thirty years this is when you talk about

2:20:13 ↗ old Issaquah and where did old Issaquah

2:20:15 ↗ go we made a decision thirty years ago

2:20:18 ↗ and have continued to execute public

2:20:20 ↗ policy around having a well rounded city

2:20:23 ↗ that has commercial and retail and

2:20:26 ↗ residential and so when you see we are

2:20:30 ↗ able to function with a relatively lower

2:20:35 ↗ cost to our residents to our homeowners

2:20:39 ↗ than many of our comparable cities on

2:20:41 ↗ the east side this is the upside part of

2:20:44 ↗ the upside and there's there's a number

2:20:47 ↗ of having of being a real city and not

2:20:50 ↗ just being a bedroom community and so I

2:20:52 ↗ think this is SuperDuper important and I

2:20:54 ↗ I struggle because I don't want to throw

2:20:55 ↗ any of our neighboring cities under the

2:20:57 ↗ bus but this is really the repercussions

2:21:00 ↗ of being well rounded and so I'm very

2:21:03 ↗ proud of these numbers and I will tell

2:21:05 ↗ you that these numbers are lower than

2:21:07 ↗ unincorporated King County I looked at

2:21:09 ↗ unincorporated King County last summer

2:21:11 ↗ and so when people think that by not

2:21:14 ↗ incorporating they're gonna get

2:21:16 ↗ themselves a better tax bill

2:21:18 ↗ unfortunately that's not how it works

2:21:20 ↗ so and our residents and this numbers

2:21:23 ↗ prove that thanks sounds remember

2:21:27 ↗ winters time property taxes are roughly

2:21:30 ↗ 13% of revenue and the general fund that

2:21:34 ↗ true roughly in were you looking at a

2:21:37 ↗ specific year just India recently it's I

2:21:43 ↗ mean

2:21:53 ↗ I mean how you you don't have to do I

2:21:55 ↗ thought maybe you'd know if top your

2:21:57 ↗ head this isn't I just just to put this

2:21:59 ↗ in another I think in an important

2:22:01 ↗ perspective as well as what this rate

2:22:03 ↗ you know that this rate is what it is

2:22:05 ↗ but it's also only about 13 percent of

2:22:09 ↗ our revenue mm-hmm and in in I was just

2:22:12 ↗ looking back into them in the mid-year

2:22:14 ↗ report yeah you have it in the narrative

2:22:17 ↗ well we've we've collected what I've got

2:22:20 ↗ in the narrative here is not the

2:22:23 ↗ percentage of our total our overall

2:22:26 ↗ revenue so that's something that we can

2:22:31 ↗ add the the chart and you know it's more

2:22:34 ↗ just yeah the you have this in here you

2:22:39 ↗ compares with the other cities and

2:22:41 ↗ that's interesting and and we have a

2:22:45 ↗ significant amount of retail sales tax

2:22:48 ↗ for example not everybody has the same

2:22:50 ↗ mix so that that's that's it's

2:22:55 ↗ interesting to compare but we're not

2:22:57 ↗ really but II you know we have to do it

2:23:00 ↗ I think it only makes sense if you know

2:23:04 ↗ the entire makeup what's the president

2:23:07 ↗ yes I wanted to add to this too because

2:23:10 ↗ the one we're looking at this

2:23:12 ↗ information is that the city portion

2:23:14 ↗ includes the excess debt levy and so one

2:23:18 ↗ thing to note is that another community

2:23:20 ↗ may have have had voter approved excess

2:23:25 ↗ levies go forward they may have opted to

2:23:28 ↗ do a lid levy lift they may have opted

2:23:32 ↗ to do utilize all of their bank capacity

2:23:35 ↗ so so this this tells a story of

2:23:39 ↗ everything that that a community has has

2:23:42 ↗ determined to do and when we compare

2:23:44 ↗ those communities and so I just wanted

2:23:46 ↗ to point that out is that this is the

2:23:47 ↗ the total city portion of all the

2:23:50 ↗ different levies that and the the

2:23:55 ↗ impacts to their levy that those

2:23:57 ↗ communities have chosen do it thank you

2:24:03 ↗ for that clarification

2:24:05 ↗ so then we move on to page 123 I just

2:24:09 ↗ wanted to give a council the council a

2:24:11 ↗ breakdown of our sales tax it goes to a

2:24:15 ↗ variety of different places you can see

2:24:17 ↗ that the city of Issaquah does not

2:24:19 ↗ collect the the the total 10% general

2:24:23 ↗ sales tax so we collect a small portion

2:24:26 ↗ just like the property tax it goes to

2:24:29 ↗ other entities then we put in some

2:24:32 ↗ information - about our our total sales

2:24:35 ↗ tax as well as a history of sales tax by

2:24:38 ↗ some of those major categories there's a

2:24:42 ↗ quite a number of different categories

2:24:45 ↗ of sales tax that we monitor and receive

2:24:49 ↗ and it's all over the board but the

2:24:53 ↗ major portion is the retail sales tax

2:24:55 ↗ portion then we move on to information

2:24:59 ↗ background information about our

2:25:01 ↗ business and occupation tax you can see

2:25:03 ↗ there all of the different tax rates

2:25:05 ↗ again the tax rate was was changed in

2:25:09 ↗ 2015 so you can see how we look at and

2:25:14 ↗ how we audit those bno tax returns and

2:25:18 ↗ those thresholds for whether or not

2:25:20 ↗ someone has to file a tax return

2:25:23 ↗ quarterly filing is at 25000 an annual

2:25:28 ↗ filing is at a hundred thousand and then

2:25:31 ↗ providing some historical information

2:25:33 ↗ and forecast

2:25:40 ↗ keep going moving on to page 125 at the

2:25:44 ↗ bottom is information utility taxes and

2:25:46 ↗ those are the taxes that we charge on

2:25:48 ↗ electricity natural gas so again that

2:25:51 ↗ forecast of all of the different

2:25:53 ↗ categories of utility tax and then on

2:25:55 ↗ the next page 126 shows a historical

2:25:59 ↗ comparison by the type of utility tax

2:26:03 ↗ that the city collects we also have

2:26:06 ↗ included information about building

2:26:08 ↗ permits engineering and plan check fees

2:26:10 ↗ at the bottom of page 126 and just want

2:26:13 ↗ to know this was a question last year

2:26:16 ↗ but we're certainly keeping it in

2:26:17 ↗ because there was a question about plan

2:26:20 ↗ check fees dipping and an engineering

2:26:22 ↗ fees increasing and this was primarily

2:26:26 ↗ due to some in 2014 and 16 some of large

2:26:30 ↗ multifamily projects in Highlands and

2:26:34 ↗ well in the valley floor to show you

2:26:37 ↗ that again like I stated this is a hard

2:26:40 ↗ one to predict and we do our best to

2:26:43 ↗ monitor what's in the pipeline and put

2:26:45 ↗ that into our forecast and budgets

2:26:51 ↗ shared revenues then is on page 127

2:26:55 ↗ shared revenues include our liquor

2:26:57 ↗ license our liquor profits and and

2:26:59 ↗ marijuana profits and just to show you

2:27:02 ↗ where where we have been and how we the

2:27:06 ↗ dollar amounts that we have been

2:27:08 ↗ collecting tell us remember hunt I

2:27:13 ↗ actually have a question about the

2:27:15 ↗ previous page the figure four with the

2:27:18 ↗ building permits engineering and plan

2:27:20 ↗ check you mentioned that it's hard to

2:27:23 ↗ predict these I also is it safe to say

2:27:27 ↗ that they're not tracking with each

2:27:28 ↗ other you you don't see the same trends

2:27:31 ↗ with you can't really predict what's

2:27:34 ↗ gonna happen with the plan check or with

2:27:37 ↗ building permits and they're just sort

2:27:39 ↗ of independently changing it looks like

2:27:47 ↗ yeah listen I just want a question is

2:27:50 ↗ there there they don't they're not

2:27:51 ↗ really they're not following a trend

2:27:54 ↗ with each other they just follow

2:27:55 ↗ different trends for each of those these

2:28:06 ↗ that's not I guess it's not really

2:28:08 ↗ question it's just I I would have

2:28:09 ↗ thought that they would have a

2:28:11 ↗ relationship with each other where

2:28:12 ↗ they're correlated or something but they

2:28:14 ↗ seem to not be they do it's a little

2:28:18 ↗ funky on this page I think you're seeing

2:28:21 ↗ the impact of the moratorium here so

2:28:23 ↗ they do sort of track until we hit that

2:28:26 ↗ that moment in time to some degree

2:28:29 ↗ there's also lag

2:28:30 ↗ so you'll typically you get the plan

2:28:35 ↗ check and then the building permit so

2:28:41 ↗ they do they they typically follow kind

2:28:44 ↗ of similar pattern but I think we've had

2:28:46 ↗ some weirdness with our moratorium

2:28:50 ↗ impact and and that's why 2017 was so

2:28:56 ↗ difficult for us we tried to be very

2:28:59 ↗ conservative in our estimate and

2:29:00 ↗ actually had more in the pipeline that

2:29:03 ↗ proceeded faster than we had expected so

2:29:08 ↗ that's really the strangeness I think

2:29:11 ↗ you begin to see play out in 2016 and

2:29:14 ↗ 2017 I just like that there was a year

2:29:19 ↗ that we run in $50 in engineering of

2:29:22 ↗ inspections it just makes you wonder

2:29:27 ↗ what was that $50 any other questions

2:29:34 ↗ the homestretch

2:29:38 ↗ I think your mic is your mic not about

2:29:44 ↗ that on page 128 there's a this is the

2:29:48 ↗ some similar information the council

2:29:50 ↗ might have seen for information purposes

2:29:52 ↗ only

2:29:53 ↗ these are alternative revenue options

2:29:56 ↗ that may be considered we talked about

2:29:59 ↗ that earlier about a new source of

2:30:01 ↗ revenue was in one of the scenarios in

2:30:04 ↗ the financial model but it is hoped to

2:30:07 ↗ give the council a very brief background

2:30:09 ↗ about some of these alternative revenue

2:30:13 ↗ options there is certainly more

2:30:15 ↗ information certainly about any of these

2:30:17 ↗ revenue options and as we go forward

2:30:21 ↗ through the budget discussions certainly

2:30:23 ↗ would would bring forth more

2:30:26 ↗ comprehensive review of a source should

2:30:28 ↗ the council direct the administration to

2:30:30 ↗ do so all right questions all right

2:30:39 ↗ does administration have any closing

2:30:42 ↗ comments for us this evening does anyone

2:30:46 ↗ in council have any comments I'm

2:30:48 ↗ something of a winter's day

2:30:49 ↗ thank you toilet I think I'm gonna ask a

2:30:55 ↗ question of the administration that I'm

2:30:56 ↗ gonna ask a question of you the the

2:30:59 ↗ fiscal model summary the baseline sarios

2:31:02 ↗ a b c and d you've indicated tonight

2:31:07 ↗ that you will be using this information

2:31:13 ↗ some i mean and maybe going forward did

2:31:17 ↗ you just explain what what you were

2:31:19 ↗ talking about there I'd like to hear

2:31:21 ↗ that and then actually so I'm gonna let

2:31:23 ↗ Tola know what I'm gonna ask him as well

2:31:25 ↗ so Tola

2:31:26 ↗ it seems to me that that model and what

2:31:29 ↗ we've assumed in there are all big is is

2:31:33 ↗ there's a pretty big deal it's hold

2:31:36 ↗ documents a big deal Jen but that part's

2:31:38 ↗ a really big deal and and if some of us

2:31:43 ↗ I know you know Ryan

2:31:44 ↗ bill Vikki haven't seen it before at all

2:31:48 ↗ but it would be good not to go away

2:31:51 ↗ tonight without getting at least some

2:31:53 ↗ type of reaction to what was proposed

2:31:58 ↗ here or or or what it's not really a

2:32:00 ↗ proposal but what's in this model and

2:32:02 ↗ what it might be from everybody I'd like

2:32:03 ↗ to get because we spent a lot of time on

2:32:05 ↗ this and the ad hoc committee I just

2:32:07 ↗ seeing it for the first time I'm just

2:32:09 ↗ kind of wondering if they have any

2:32:11 ↗ reaction or care the concerns or

2:32:13 ↗ comments and and and I thought before we

2:32:16 ↗ left tonight to get that would be good

2:32:18 ↗ but I'd also like to hear a little bit

2:32:19 ↗ more how the administration was it wants

2:32:21 ↗ to use this information so there you go

2:32:29 ↗ okay so one of the things that so what I

2:32:35 ↗ what I would like to do to honor that is

2:32:39 ↗ I would like to offer council members an

2:32:43 ↗ opportunity to summarize how this

2:32:46 ↗ information they think will what

2:32:51 ↗ questions it may address that we want to

2:32:54 ↗ bring up in the budget process but I

2:32:56 ↗ also want to make a mechanism where

2:32:59 ↗ people can alternately if they have

2:33:03 ↗ feedback that they want to provide in

2:33:05 ↗ writing this week to the administration

2:33:07 ↗ they could do that and the

2:33:08 ↗ administration could come back to us

2:33:10 ↗ because I know some of us are more

2:33:11 ↗ comfortable speaking extemporaneously

2:33:13 ↗ and some people are not so I want to I

2:33:16 ↗ want to provide both of those mechanisms

2:33:17 ↗ and make sure people don't feel like

2:33:19 ↗ they would have to do it tonight they

2:33:21 ↗ could also do it in if they wanted to

2:33:23 ↗ after after sleeping on it and thinking

2:33:26 ↗ about it a little further I like the

2:33:30 ↗ idea of us having an opportunity to

2:33:33 ↗ provide that feedback and I've sort of

2:33:34 ↗ already done that myself personally

2:33:43 ↗ so I think from administration's

2:33:45 ↗ standpoint we were just eager to share

2:33:48 ↗ this information so you have a better

2:33:50 ↗ sense of the overall financial health of

2:33:52 ↗ the organization and you asked you know

2:33:56 ↗ how might we use this information going

2:33:59 ↗ forward and I think we have a we have a

2:34:02 ↗ couple places at least coming up soon

2:34:05 ↗ we're having this background will help

2:34:08 ↗ us in facing some decisions so one is

2:34:12 ↗ with the budget amendment that is coming

2:34:14 ↗ up majority of the budget amendments are

2:34:20 ↗ items that have already been approved by

2:34:23 ↗ council and you've directed us to

2:34:25 ↗ incorporate those but when we bring it

2:34:28 ↗ back to you as a package it looks like a

2:34:30 ↗ big number so this will help you put it

2:34:33 ↗ into context to some degree and we are

2:34:37 ↗ in the midst of developing the 19 budget

2:34:41 ↗ I think having this background

2:34:43 ↗ information will allow you to maybe get

2:34:47 ↗ a visual on how what we will propose for

2:34:53 ↗ 2019 compares to what's in the forecast

2:34:55 ↗ let's take an example of that might be

2:34:58 ↗ the debt service level we might propose

2:35:03 ↗ having greater debt expenditure or we

2:35:06 ↗ might propose adding more staffing

2:35:09 ↗ resources than what was depicted here

2:35:12 ↗ and you might be able to kind of scale

2:35:14 ↗ up and understand what the longer-term

2:35:18 ↗ impact of that is I think on the

2:35:23 ↗ scenarios that we gave you we are hoping

2:35:27 ↗ to get some reaction whether it's

2:35:30 ↗ tonight or some point in the near future

2:35:32 ↗ so that we can bring forward a tangible

2:35:36 ↗ proposal a direct proposal for you on

2:35:38 ↗ how to meet some of the community needs

2:35:41 ↗ that you've expressed whether that's

2:35:44 ↗ transportation or something else as

2:35:47 ↗ council president Mart's stated there is

2:35:52 ↗ an

2:35:53 ↗ standing directive to the ad hoc Finance

2:35:56 ↗ Committee to come back to the whole

2:35:58 ↗ council with the recommendation on how

2:36:01 ↗ to fund the unfunded transportation

2:36:05 ↗ projects and so we're trying to be

2:36:08 ↗ responsive to that as well deputy

2:36:15 ↗ council president impetus first of all

2:36:19 ↗ Jan and everyone who worked on this

2:36:23 ↗ thank you for for all the hard work and

2:36:27 ↗ everything that has gone into this I

2:36:29 ↗ would say I just wanted to give a little

2:36:32 ↗ bit of initial feedback and then if I

2:36:34 ↗ have some other thoughts all follow up

2:36:36 ↗ via email but having the the modeling

2:36:40 ↗ and the ending fund balance baseline

2:36:43 ↗ with the different scenarios especially

2:36:45 ↗ as we're talking about transportation is

2:36:48 ↗ really helpful to me being able to look

2:36:51 ↗ at that and think about the different

2:36:52 ↗ scenarios and and try to I think it just

2:36:56 ↗ helps my brain anyway to think about

2:36:58 ↗ those different scenarios especially

2:37:00 ↗ before something comes forward I did

2:37:03 ↗ have the question about that that we

2:37:06 ↗ went straight to recall it traffic

2:37:08 ↗ instead of transportation here but that

2:37:10 ↗ we went straight to that so better

2:37:12 ↗ understanding that was good we asked a

2:37:16 ↗ few questions around those assumptions I

2:37:19 ↗ always feel like when you're working

2:37:21 ↗ with models and assumptions it's really

2:37:24 ↗ good to get a lot of pushback on the

2:37:27 ↗ assumptions I think it gives you a

2:37:29 ↗ better product in the end so I was glad

2:37:31 ↗ that we had a conversation around that

2:37:33 ↗ so I just wanted to say overall having

2:37:36 ↗ having it modeled this way and and being

2:37:40 ↗ able to look at that is helpful for me

2:37:45 ↗ other comments

2:37:51 ↗ council member hunt thank you also for

2:37:56 ↗ all of the work that went went into this

2:37:58 ↗ so this is the first time that I've been

2:38:01 ↗ looking at the budget and we're looking

2:38:04 ↗ at the finances in such detail and I

2:38:06 ↗ think for me the the thing that I want

2:38:09 ↗ to look at in parallel with the model is

2:38:12 ↗ what's in our CIP because I think that

2:38:14 ↗ that is the other piece to this and look

2:38:18 ↗ at here it is trying to tackle traffic

2:38:22 ↗ or transportation but as has been

2:38:25 ↗ mentioned by my fellow councilmembers

2:38:27 ↗ there are other things in the CIP too

2:38:29 ↗ and I think that that really affects how

2:38:33 ↗ I would think of the scenarios and then

2:38:36 ↗ I think that having the having the

2:38:39 ↗ scenarios where you just change one

2:38:41 ↗ variable it makes a lot of sense for

2:38:43 ↗ looking at how in the big picture how

2:38:47 ↗ changing one variable does change the

2:38:49 ↗ trend over time it might be as we have

2:38:54 ↗ more conversations it might be helpful

2:38:56 ↗ to have some more realistic detailed

2:39:00 ↗ versions of scenarios where if we if we

2:39:03 ↗ come sort of start narrowing down our

2:39:06 ↗ options and then think well if we did

2:39:08 ↗ this then we would probably start tuning

2:39:10 ↗ down this other lever at this point that

2:39:14 ↗ would also be helpful so I will be

2:39:17 ↗ looking at looking in more detail to try

2:39:20 ↗ to match up my understanding of this

2:39:23 ↗ model with the CIP councilmember Ramos

2:39:30 ↗ yeah this is great to start looking at

2:39:34 ↗ the budget in this way because one of

2:39:35 ↗ the concerns I've had as we've done

2:39:37 ↗ things in the past is we look at the big

2:39:39 ↗ budget and then we keep making these

2:39:41 ↗ amendments through the year which keep

2:39:42 ↗ adding a piece of the time of pieces

2:39:45 ↗ time as you just mentioned all of a

2:39:46 ↗ sudden we're gonna get an amendment

2:39:47 ↗ that's gonna come here and look like how

2:39:48 ↗ the heck we did we just approve all that

2:39:50 ↗ because it totals up quickly and it's

2:39:53 ↗ not and when we do that we're never

2:39:54 ↗ looking at the big piece we just keep

2:39:56 ↗ looking at these individual pieces which

2:39:58 ↗ which puts our perspective nothing in a

2:40:01 ↗ good way so this is a start

2:40:04 ↗ trying to look at that hole that big

2:40:06 ↗ picture and say compare back to the CIP

2:40:09 ↗ that's all great too but we have not

2:40:11 ↗ prioritized that list in in the totally

2:40:16 ↗ you know so as we look at that it's like

2:40:18 ↗ what would we do in in what order and

2:40:20 ↗ that would also make a difference to to

2:40:22 ↗ how we fund things in the long run as

2:40:24 ↗ well so the priorities do make a

2:40:26 ↗ difference to to that list as well and

2:40:29 ↗ and another thing that I guess because

2:40:30 ↗ I've heard it previously as we need you

2:40:33 ↗ know a transportation benefit district

2:40:35 ↗ to fund these things and this is shown

2:40:37 ↗ that there are some ways without adding

2:40:39 ↗ more money because I think one of our

2:40:40 ↗ most important duties is to take the

2:40:43 ↗ money we have now and spend it very

2:40:45 ↗ wisely and in places where we prioritize

2:40:47 ↗ it I think it's most important and

2:40:49 ↗ before we ask for additional funding so

2:40:52 ↗ that's that's showing that that gives us

2:40:54 ↗ more option than what I've heard

2:40:55 ↗ previously from s administrations so

2:40:59 ↗ that's a real good way to start looking

2:41:01 ↗ at those those things so to me

2:41:02 ↗ prioritizing what can you get done with

2:41:05 ↗ the resources you have protecting them

2:41:07 ↗ out over time before you start looking

2:41:09 ↗ at more and really the way we just do

2:41:15 ↗ our budgeting in a way that when we keep

2:41:17 ↗ adding pieces we have to somehow keep

2:41:19 ↗ keep the whole picture in mind versus a

2:41:21 ↗ little piece of the time a little piece

2:41:22 ↗ of the time and all of a sudden you

2:41:24 ↗ spent a few extra million dollars that

2:41:26 ↗ you weren't expecting this bin and that

2:41:27 ↗ that lets our budget way out of whack

2:41:30 ↗ when we when we're looking at the big

2:41:31 ↗ picture we're arguing sometimes down to

2:41:33 ↗ ten thousand dollars or something like

2:41:34 ↗ that and Ellison's something much bigger

2:41:36 ↗ comes buying it slides right in so those

2:41:39 ↗ are things I hope that we continue to

2:41:40 ↗ improve how we look at this budget

2:41:42 ↗ overall and then fiscal practices will

2:41:45 ↗ just keep getting better thank you

2:41:49 ↗ so so I'll circle back this is this is

2:41:54 ↗ incredibly valuable information and

2:41:55 ↗ thank you very much it's super important

2:41:58 ↗ that that people understand this

2:41:59 ↗ information and that's why you know I

2:42:02 ↗ apologize if I if I pick some

2:42:04 ↗ engineering nits and some individual

2:42:05 ↗ slides I just want to make sure the

2:42:07 ↗ public understand it's because because I

2:42:08 ↗ think generally it tells a really good

2:42:10 ↗ story about our fiscal stewardship it

2:42:15 ↗ does this issue of

2:42:17 ↗ we track compared to inflation is a

2:42:19 ↗ thing I'm gonna really want to

2:42:21 ↗ understand going forward I have some

2:42:23 ↗ concerns I'm again I'm hoping that when

2:42:26 ↗ we look at it on a long timeline and

2:42:29 ↗ gonna put it in present dollars and all

2:42:31 ↗ that kind of stuff

2:42:31 ↗ that my concerns will will not you know

2:42:35 ↗ will go away you know I want to

2:42:38 ↗ reiterate I think the challenge coming

2:42:40 ↗ out of tonight is to talk about this

2:42:44 ↗ you know there's transportation and then

2:42:46 ↗ there's the other right and the a you

2:42:48 ↗ know I wrote down some stuff open space

2:42:50 ↗ we've had conversations recently about

2:42:52 ↗ spending money on open space we've got

2:42:55 ↗ you know recreational facilities every

2:42:58 ↗ so often we get letters from people that

2:42:59 ↗ want us to build a new pool and we're

2:43:01 ↗ not gonna do that any time soon but

2:43:03 ↗ that's in the mix out there city

2:43:06 ↗ facilities and where the city what the

2:43:08 ↗ city looks like 20 years from now for

2:43:10 ↗ infrastructure human services things

2:43:13 ↗ that we want to do services to provide

2:43:15 ↗ for the community workforce housing is

2:43:17 ↗ something that at times cost money

2:43:19 ↗ you know Senior Center do we want to

2:43:21 ↗ invest money and in running a Senior

2:43:23 ↗ Center ourselves that's a that's a

2:43:25 ↗ smaller one but a one that's coming up

2:43:27 ↗ in the near term and we have to factor

2:43:29 ↗ all these things in when we look at that

2:43:32 ↗ coming up with a curve that's that's

2:43:34 ↗ beautiful and just touches a limit that

2:43:37 ↗ we set for ourselves we want to make

2:43:38 ↗ sure that those other factors although

2:43:41 ↗ no one of them probably you know raises

2:43:44 ↗ people's blood pressure as much in the

2:43:46 ↗ community as traffic put together

2:43:47 ↗ they're also additional important

2:43:50 ↗ factors for making our city run well so

2:43:52 ↗ I'm not sure exactly how we broaden the

2:43:54 ↗ conversation to include those topics but

2:43:57 ↗ we'll figure it out and we'll do it

2:44:00 ↗ any other comments and I do want it I

2:44:03 ↗ don't know if we have anybody from the

2:44:04 ↗ public here tonight but if we do we

2:44:05 ↗ could do we have anybody yeah all right

2:44:08 ↗ we don't have to worry about public

2:44:09 ↗ comment all did you yeah thank you

2:44:14 ↗ regarding the the scenarios I'm gonna

2:44:18 ↗ repeat myself somewhat but it is so I've

2:44:21 ↗ had the opportunity to sleep on it for

2:44:23 ↗ many moons I'm not just hearing it for

2:44:25 ↗ the first time we heard it in the

2:44:26 ↗ ad hoc committee and seeing it again

2:44:29 ↗ tonight there I think Vicki touched upon

2:44:34 ↗ something I think I saw some non income

2:44:36 ↗ heads we see we think we think we think

2:44:39 ↗ this strategy we pick a strategy to go

2:44:42 ↗ forward with we will perhaps refine some

2:44:45 ↗ of the estimates that makes sense to me

2:44:48 ↗ but at at this level I think I think

2:44:51 ↗ what we're looking for some type of

2:44:52 ↗ policy direction with this granularity

2:44:54 ↗ in this type and level of data that we

2:44:57 ↗ have right now so so that I think that's

2:45:00 ↗ that will happen well we'll get more

2:45:03 ↗ rule refined things once we focus in on

2:45:07 ↗ a scenario that we want to try to

2:45:08 ↗ execute on I'm still in favor of I do

2:45:12 ↗ like the idea of using that capacity

2:45:16 ↗ that we have and saying we're going to

2:45:19 ↗ fund this out of our existing revenues

2:45:21 ↗ and we're gonna we're going to figure

2:45:22 ↗ out how to make this work and so that

2:45:24 ↗ and that so that so that cenario see

2:45:28 ↗ that we've already discussed I just want

2:45:31 ↗ to reiterate I think that that is I'd

2:45:33 ↗ like to see us go on a path and try to

2:45:36 ↗ do that and and I think what I heard

2:45:39 ↗ that does say there's got to be some

2:45:43 ↗ revenue we have to somehow fund a

2:45:47 ↗ greater debt obligation and the TBD

2:45:49 ↗ still maybe one of the tools for doing

2:45:51 ↗ that but not anytime soon

2:45:53 ↗ if we follow scenario C any other

2:46:00 ↗ comments o deputy council president

2:46:04 ↗ batiste

2:46:05 ↗ so that this comment may be a little bit

2:46:08 ↗ down in the weeds but I'll just go ahead

2:46:10 ↗ and talk about it the as we talk about

2:46:15 ↗ whether this is for transportation or or

2:46:18 ↗ it's going to include other things as

2:46:20 ↗ has been talked a little bit about when

2:46:23 ↗ we when we look at scenario B and within

2:46:28 ↗ the modeling we bring it all the way

2:46:30 ↗ down to the 15% reserve line that what

2:46:36 ↗ what sticks out to me is

2:46:38 ↗ if we're if we're wrapping everything

2:46:40 ↗ around transportation and we go all the

2:46:42 ↗ way down to that reserve line and then

2:46:45 ↗ what about other things that might come

2:46:47 ↗ up so just within the modeling it might

2:46:50 ↗ there might be the ability to play with

2:46:52 ↗ the numbers a little bit so it's not to

2:46:54 ↗ being all the way down and scenario B to

2:46:56 ↗ the 15 percent reserve line so just a

2:46:59 ↗ thought so all for myself a third

2:47:08 ↗ comment I think that I want to come back

2:47:16 ↗ to this idea that if we know what we

2:47:19 ↗ need to do I think that one of the

2:47:22 ↗ things we should consider as a council

2:47:24 ↗ is whether we go to the public sooner

2:47:28 ↗ rather than later I think that on the

2:47:31 ↗ last bond I don't think the public

2:47:35 ↗ necessarily saw the direct coupling of

2:47:39 ↗ what we wanted to do to improve to

2:47:42 ↗ improving transportation in and through

2:47:44 ↗ the city and I think that if we came up

2:47:47 ↗ with a killer package of things that

2:47:51 ↗ everybody looked at and said oh yeah

2:47:54 ↗ that's gonna make traffic better

2:47:55 ↗ tomorrow right

2:47:56 ↗ like the roundabout in front of in front

2:48:00 ↗ of target makes better banks traffic

2:48:02 ↗ better right now right it's better safer

2:48:05 ↗ through that area now than it was before

2:48:08 ↗ that roundabout was there there's

2:48:10 ↗ there's projects like that so I I just

2:48:13 ↗ want to I don't want to leave it unsaid

2:48:16 ↗ that there's an option going forward

2:48:17 ↗ that would be putting together like I

2:48:19 ↗ said this killer package of

2:48:20 ↗ transportation benefits and putting in

2:48:22 ↗ front of the public that I think we you

2:48:27 ↗ know we did well on a package that I as

2:48:30 ↗ I said had some confusion had an active

2:48:32 ↗ no campaign if we had something that the

2:48:34 ↗ public thought Janet that's perfect

2:48:36 ↗ that's what we need

2:48:38 ↗ I think we'd find the other 5% so I

2:48:40 ↗ think it needs to stay in the mix in

2:48:42 ↗ consideration I also think that before

2:48:44 ↗ we did the parks bond and this was what

2:48:48 ↗ five years ago something like that we

2:48:51 ↗ did some polling to find out priorities

2:48:53 ↗ around bonding specifically right and so

2:48:56 ↗ when we did the bond and we said five

2:48:59 ↗ million of it was going to be for

2:49:00 ↗ renovating the pool and five million of

2:49:03 ↗ it was going to be for confluence we had

2:49:05 ↗ some confidence that there was support

2:49:07 ↗ for that in the community and it's one

2:49:08 ↗ of the reasons why we just went to the

2:49:09 ↗ city we didn't try to create a benefit

2:49:11 ↗ district that would include the larger

2:49:14 ↗ area because those voters told us to go

2:49:16 ↗ pound sand and so I wonder if there's an

2:49:19 ↗ opportunity as we move forward to get a

2:49:22 ↗ better feel as to the community's

2:49:24 ↗ appetite for what they would want to see

2:49:26 ↗ potentially bonded out to the public

2:49:29 ↗ before deciding what would go into that

2:49:32 ↗ quote-unquote killer package so again

2:49:38 ↗ other additional comments thoughts going

2:49:43 ↗ once

2:49:43 ↗ I think twice I guess we don't have to

2:49:46 ↗ do it like public comment we don't have

2:49:47 ↗ to ask three times with that we are

2:49:49 ↗ adjourned thank you very much everyone

2:50:02 ↗ you

Approved minutes

Extracted from the next meeting's packet, where this meeting's minutes were approved as a consent-calendar attachment.

Open PDF

Attendance

Council / Members (7)

Mariah Bettise

Stacy Goodman

Victoria Hunt

Tola Marts (Mayor Pro Tem)

Bill Ramos

Chris Reh

Paul Winterstein

Staff (4)

Emily Moon, Interim City Administrator

Christine Eggers, City Clerk

Jennifer Olson, Finance Director

Christina Ericksen, Financial Operations Manager

Excused

Mary Lou Pauly, Mayor