[0:06] Yes. Good evening and welcome to our
specially called meeting and budget
[0:12] workshop. Uh today is September 1st,
2026.
[0:17] It is now 6 pm. Uh we do have a quorum
uh present for tonight. uh to my right
[0:25] and that'll be to your left if you're
watching on Facebook live or YouTube uh
[0:31] we have uh Councilman Julius Buckley and
next to him uh Councilman Rosco War,
[0:38] Councilman Brent Mwaters,
our city manager, Mr. Lee Typton,
[0:44] yours truly,
uh, Councilwoman Desiree David,
[0:50] Councilwoman Rachel Hall, and
Councilwoman uh, uh, Dr. Tanya Clark.
[0:57] And I'm going to ask our own Deacon
Rosco War if he offer us prayer tonight.
[1:03] And Miss David will do uh, our U flags
for us tonight. Texas flag and oh glory.
[1:13] Yeah.
[1:31] Lord,
[1:36] thank
[1:42] you bless
[2:00] Lord
city workers
[2:06] continue
[2:11] by no long.
[2:28] Amen.
>> Amen. Amen.
[2:30] » Would everyone please the flag
[2:36] » to the flag of the United States of
America and to the republic for which it
[2:41] stands. One nation under God indivisible
with liberty and justice for all.
[2:48] » Texas flag.
I aliance to thee Texas one state
[2:55] one and indivisible.
[3:08] Okay, we'll now move on to our uh public
comments.
[3:12] Any person with city related business
may speak to the council in compliance
[3:18] with the Texas Open Meetings Act. The
city council may not discuss or vote on
[3:22] any matter raised in public comments
unless it is specifically on the agenda.
[3:28] To speak during a council meeting, the
presiding officer must recognize you.
[3:34] And with that being said, uh, Miss
Oneita, do we have anyone signed up for
[3:38] tonight?
Okay.
[3:43] Okay, since we have no one signed up to
speak tonight, uh we're going to move in
[3:49] to uh open our public hearing tonight.
Uh
[3:56] public hearing on
fiscal year 2026 2027 budget. It is uh
[4:05] now 6:05 and we will open our hearing.
[4:15] I give him a minute.
[4:29] Okay. Since we have uh no comments on in
our public hearing, I will now close the
[4:37] public hearing at 6:05.
[4:43] Okay. Now, I'll call the regular meeting
to order
[4:48] and um that'll be 603.
Okay. Uh we're going to
[4:57] start out with item number three. And
we're going to go back to item number
[5:02] two. Uh,
okay. Item number three, approve
[5:07] contract with
Blue Shield, Blue Cross Blue Shield for
[5:12] employee benefits
and authorize the city manager to
[5:17] execute the contract.
Miss Angela, you mind stating your name
[5:21] and title?
[5:30] Angel
director
[5:41] contract
[5:47] questions.
[6:10] red light.
[6:16] » Yeah, there it goes.
[6:19] » I do just have one question. I remember
uh speaking about it last time and I
[6:23] understand the only difference is
needing to claim a primary care
[6:27] physician. Is that correct with the
current plan? And then they would need
[6:30] to get the referral to a specialist.
>> Correct.
[6:33] » Um how does that delay um special care
needs? Like does it mean that they might
[6:40] be waiting three or six months in a
referral process or can they still
[6:43] pretty much get immediately get the care
that they need through um their primary
[6:47] care provider or a specialist?
>> That's going to be up to the primary
[6:51] care provider. So if they feel that
Sorry.
[6:54] » Yeah, ma'am. Would you mind stating your
name and
[6:57] » Oh, my name is Alison GM. with Hub
International. Um, so that depends on
[7:01] the primary care physician. If the
primary care physician feels that the
[7:05] patient is authorized for a specialist
visit, then they can prescribe that
[7:08] referral right then and there. If they
do not feel like they need it and they
[7:11] want to run a couple tests beyond the
initial visit, then yes, it can cause a
[7:16] delay, but that is up to the primary
care physician's discretion, not up to
[7:20] the Blue Cross plan.
>> Okay, great. Thank you.
[7:28] Any other questions?
>> Okay. Do we have any other questions u
[7:36] concerning Blue Cross Blue Shield
employee benefits?
[7:42] » Okay, there be no other questions.
[7:47] » Make a motion we approve contract of
Blue Shield, Blue Cross Blue Shield for
[7:51] employee benefit and authorize city
manager to execute the contract.
[7:54] » Second. Okay, I have a a motion. by Mr.
Buckley. I have a second by Mr.
[7:59] Magwaters.
Any other questions or comments?
[8:04] Okay.
All those in favor?
[8:09] Okay. Motion carries. Seven to zero. Uh
thank you, Miss Angela.
[8:15] » Thank you.
>> Thank you, ma'am. Be safe going home.
[8:20] » Okay.
>> Sorry.
[8:23] » Okay. We're going to go back to item
number two. have a safe trip home. Thank
[8:27] you.
>> Okay.
[8:29] » Okay. We're going to go back to item uh
number two and uh Angela, you can stay
[8:34] there. Consider and approve the revised
city of Cleveland employee handbook.
[8:40] Uh
Angela.
[8:46] » And we should have Miss Christina who's
going to be um joining us virtual. She
[8:52] was not able to attend due to the
weather.
[8:58] Good evening, council. This is Christina
Peters. I'm with Charlesworth Consulting
[9:02] and I had the privilege of working with
your HR department with Angela and
[9:06] Felicity on revising the employee
handbook. Uh primarily the old one that
[9:13] was in existence. We just wanted to make
sure it was updated, it complied with
[9:18] both federal and state laws, make sure
we were in compliance, um, and did an
[9:22] overhaul to make sure it was easily
accessible to employees, make sure it
[9:26] was searchable, um, and in a format
which they can understand. So, we spent
[9:31] a large amount of time going through
each section. Um, I know you all have
[9:35] had a chance to review it. We spent many
many sessions with both HR directors
[9:40] have reviewed it and had an opportunity
to ask questions and provide comments as
[9:45] well as the city manager and legal has
done a review. So I just wanted to be
[9:50] here to answer any questions for you
folks if you had any questions in
[9:54] particular on certain policies or on the
process just to make sure everybody was
[9:58] in full understanding uh to move forward
with the final copy of the employee
[10:04] handbook for the city of Cleveland.
[10:11] I do have questions. Um, and so who am
who am I addressing because there's
[10:16] several questions in regards. So am I
addressing you or the consultant or who
[10:21] am I speaking to?
>> You can address the consultant and she
[10:23] can answer them for you.
>> Okay. All right. Um, so I'm on page 16
[10:29] of the I'll just start there for anyone
who's looking. Um this is about the job
[10:36] postings and applications
and and the second sentence begins job
[10:43] vacancies will normally be posted both
internally and externally unless
[10:49] otherwise approved by human resources.
And my question for our city staff is
[10:54] why we're using the uh
the language of normally and not having
[11:00] a policy where we post all positions uh
both part-time and full-time in external
[11:06] and internal um and removing the word
normally
[11:12] for city staff or the consultant in
regards to page 16. I'm yeah p sorry one
[11:17] says 16 the other one says 20. So on
this
[11:21] » it's fine. So this is just just the
wording. I mean that can this is an
[11:25] editable document. This is a living
document. So as time progresses, we
[11:28] wanted to make sure it was in a capacity
where changes could be made as
[11:32] situations arise. Normally is typically
put in there. Um in the event that you
[11:36] just want to post something internally
if you have a large ACU um applicant
[11:40] pool of a certain position internally.
Sometimes that option is pro um is
[11:47] preferred by both city management and HR
but normally is in there because you're
[11:51] right in most cases
it would be posted both internally and
[11:55] externally but again policies are meant
to give so employees know what the
[12:01] boundaries are. They know what the
protocols are. They know what they're
[12:04] allowed to do and what they're not. But
we also want to make sure that we
[12:07] account as HR professionals. we can't
account for every single situation that
[12:12] may occur just because it's a changing
environment, things come to play and
[12:16] quite honestly policies are put in place
because at some point um in the in the
[12:22] past something has happened that has
required a policy to be written. So
[12:25] normally just captures the event that a
situation were arise. Typically this is
[12:30] pretty normal. You would see most cities
there are opportunities where they feel
[12:34] like the AC applicant pool internally is
of high caliber and there's several
[12:39] people to apply and we'd rather promote
within. So that's just allowing that
[12:43] availability if that were to arise.
>> But it doesn't exclude it from always
[12:49] being internally and externally if
that's how HR and city management want
[12:52] to proceed.
>> Okay, great. and and I uh you're exactly
[12:56] right in regards to, you know, certain
things happen and we have had things
[13:00] happen within the city with uh job
postings in the past and certain people
[13:05] being given positions that have landed
this city in the news. And so I think
[13:09] when we are coming up with the policy
that hasn't been updated in 20 years
[13:13] that we're showing that we are, you
know, um as far as transparency that
[13:18] we're we're posting jobs and whether
you're internal or external, all
[13:22] candidates will be reviewed. you have
the the system that gives you those cut
[13:26] questions, you know, your your questions
that knocks um applicants off if they
[13:30] don't quite meet the standard, right?
So, I just think it would be a good idea
[13:34] to have that in place of that we do post
internally and externally. Um, instead
[13:40] of saying that we sort of have a policy
normally, uh, this is to me is a little
[13:45] bit more gray. Um, because it could be
about any position all the way up to
[13:49] city manager and all the way down to a
part-time employee, right? So that's my
[13:54] first question um or for discussion with
council or city staff. Um the second one
[14:00] is on page 19
slash23 whichever. Um
[14:10] » in regards to the interviews.
>> Yes. Yes ma'am. Um on this one um it
[14:15] says all interviews must include the
participation of human resources and the
[14:19] department director or their design. Um
panel interviews are encouraged uh for
[14:24] the preferred selection method to ensure
consistency. um right off the bat is uh
[14:30] I believe we have a pretty small uh
human resources department that's pretty
[14:34] busy and if we have again a part-time
library aid being uh interviewed for a
[14:41] position it would make sense for the
timeliness of um everyone and all their
[14:45] duties that the department head and
whomever is on their staff and the team
[14:49] that would be hiring would be able to
facilitate that. uh when it says
[14:52] participation of the human resources, if
we're including a human resources
[14:57] director in all interviews, uh that
salary is a pretty high salary. Director
[15:01] salaries are higher than employee
salaries and so the cost of taxpayer
[15:05] money is do we need two directors in all
um interviews or can we rely on our
[15:13] department head directors to facilitate
that and to choose who will be on the
[15:19] panel from their team.
So per this policy, this was already in
[15:25] play. So this was um a policy that the
city was already following where human
[15:29] resources was present during all
interviews. It does not designate that
[15:33] it has to be the HR director. It just
has to be human resources. So it can be
[15:37] anybody within that department. That
being said, for cities that are
[15:41] typically under 200, this is this is
very common um
[15:47] for a couple reasons. one, it's the only
consist consistency check that exists.
[15:52] So, we HR is there to make sure that
they are in compliance with laws. No
[15:57] one's asking a question they shouldn't
be asking. That the questions are not
[16:02] only fair, but they're consistent across
the practice where you're not um asking
[16:06] some candidates a set of questions and
then pivoting to something else for
[16:10] somebody else. You know, these are open
records. If there's written notes, HR
[16:16] collects those at the end of each of the
interviews. Make sure that they're saved
[16:20] for a period of time. Again, it does
protect against le legal exposure just
[16:25] again to make sure sometimes when you
have people in, they don't know what to
[16:28] ask and they ask things that they
shouldn't. It also allows for protection
[16:34] for the department heads as well as the
people being interviewed. So, I do think
[16:38] this is very common. Obviously in a city
of 1500 employees this is not possible
[16:46] but you know I currently consult on an
HR perspective for several cities up
[16:50] here in North Texas. All of them are
under 200 and this is very common in all
[16:55] of them. It's been the process that's
been in place for quite a while. Um I do
[16:59] agree it doesn't always have to be the
director. it just has to be someone in
[17:02] HR. And the only reason again is to
ensure consistency and transparency and
[17:08] fairness throughout the evaluation of
all the candidates. It's just making
[17:12] sure that everybody's on the same
playing field because again, like you
[17:16] said earlier, transparency is so
important and the interview process. You
[17:20] know, it's very easy to ask a question
that should not be asked to someone who
[17:24] isn't living and breathing this policy
all the time. So, it's just put in as a
[17:29] measure of protection for your staff,
for the candidate, and for the city as a
[17:33] whole from a liability standpoint.
>> Okay. And I do have a followup on that
[17:37] in regards to the consistency of what
they're asking. Just as someone who has
[17:41] participated in pan panel interviews,
both um on both sides of them. Um
[17:46] consistency would typically come with a
piece of paper of written questions and
[17:50] everyone would be provided with those.
It wouldn't necessarily take one
[17:53] specific person from HR to say what
questions are approved to have to sit
[17:57] there. I I guess I'm just going with
manh hours. If we have a small HR
[18:01] department, whether it's a director or
she has one or two assistants, one
[18:05] » one uh HR generalist,
>> just one. So there's only two people for
[18:09] the whole city versus relying on the
training. You mentioned something like
[18:13] um trained to handle the questions that
might not be compliant with laws. Um,
[18:19] I'm going to say that our directors are
um well-versed in their in their hiring
[18:26] process and that they would be able to
complete any training that any other
[18:30] individual on human resources could
complete in order to make sure that they
[18:35] are being consistent and if we're
looking for consistent questions, uh,
[18:38] those can be printed. Um, I just it's
about the setting a policy that looks
[18:44] like we're pulling multiple departments
and doing something whenever directors I
[18:48] feel like could take that control on
their hiring process and be trained just
[18:53] as much as any additional re human
resources to um to be in compliance of
[18:59] laws and knowing what we were asking
because you you print it out, you write
[19:02] it down. and our directors are very
capable and competent and they can
[19:06] choose people on their team to have two
or more people in that interview.
[19:11] » Yeah, it does it does state that the
department director or the design. So
[19:15] the department director does not always
have to be the one in there. I think
[19:18] those are valid points. Again, our our
roles to as we rolled out these
[19:22] policies, are they best practice? Are
they widely accepted? Is this you know,
[19:26] if you pull any policy book from any
city in the state of Texas and there's
[19:30] over 4,000, none of them are going to
look identical. Everyone's going to have
[19:33] their own set of processes or procedures
um that differ vary throughout the book.
[19:38] This is very common practice in smaller
sized cities. Again, there's no right or
[19:43] wrong answer. It's just as a policy what
the city of Cleveland would like to do
[19:47] in this system in this instance and this
is what they've been following up to
[19:51] date. So, I would assume if there was an
issue from a time capacity, they would
[19:55] be aware and maybe you know want to edit
that. But at the time being, again, our
[20:00] job was to make sure was this best
practice? Did it violate any compliance?
[20:05] And it just again it's just another
layer of consistency and transparency
[20:10] throughout the process.
>> Yes, ma'am. And I'm I'm going to come
[20:12] back to that and I guess with the
compliance or best practices compliance
[20:17] again, I believe our directors would be
in compliance and do that. I'm just
[20:22] going back to the language. It says all
interviews must have HR, but they may or
[20:26] may not have the department director of
the department being hired. Um, and I
[20:30] feel like that should maybe be
flip-flopped. Like your director of the
[20:34] department hiring for their team should
be there and they may or may not ask HR
[20:39] to come in and assist because they would
be aware of compliance and training and
[20:44] questions and we would trust them with
that, right? Because if there's only two
[20:47] people in our HR and you know it's a
busy city, it's a small city wearing
[20:51] many hats. If we did have to always the
must, the word must with HR, if it was
[20:56] the director of HR, again, we're looking
at pulling someone away from their more
[21:02] day-to-day
um responsibilities potentially at the
[21:06] higher cost of taxpayer versus
departments just having that like local
[21:11] control, right? Like that's your
department and you can ask for HR for
[21:15] consistency. Um, but I feel like
everyone can be trained and know exactly
[21:19] what to do. So, it's just the must word.
I feel like maybe should be
[21:24] » if I may interrupt. Sorry. So, when we
do these interviews, I do give out
[21:29] binders and at the front of their
binder, they're given a guide on what
[21:33] not to say, um, what is not legal. Um,
and even with that guide and me being in
[21:41] there, there's been multiple times that
I have a director or somebody from the
[21:47] panel who would not ask the question as
is. You would think that it would be
[21:52] something simple and sometimes it's just
I mean for whatever reason but that that
[21:58] is why HR is in there to you know
interrupt and and say that we have to go
[22:05] exactly according to these questions.
These questions are given to the
[22:08] directors and to the panel. Um, and we,
you know, do, you know, sometimes say,
[22:14] you know, make sure that you read it as
is, but there has been multiple times
[22:18] that they, you know, veer off of what
that question is. Um, but and and I
[22:24] understand that in that regard, and that
might be a training with the directors
[22:27] as far as stick to the script, right?
Because then if we're saying someone
[22:30] needs being there watching over a
director providing an interview for
[22:33] their department to make sure they're
not asking something that wasn't in the
[22:36] script um or for compliance then we're
saying again if it's as an HR director
[22:41] versed in the law all directors can be
versed in a hiring law through a
[22:45] training because then we're going to go
back to it's the cost of taxpayer money
[22:48] an hour of your time where is it most
valuable sitting in all interviews with
[22:53] the word must or being asked for an
assistance because a new director says
[22:57] hey I've never really interviewed will
you come and help me and be a mentor to
[23:01] me as I interview versus maybe an
experienced uh director with 20 years
[23:06] that you know can stay in compliance and
move forward with their team. Um so as
[23:10] far as for council that's my question on
this page predominantly it's the must
[23:15] with the for human resources versus the
director. Um, and then
[23:20] » I'm sorry. Can I get clarity on what
you're what you're communicating?
[23:22] Because I hear you continue to exclude
the department director. But if you read
[23:27] the sentence and the way it was written,
it says must include the participation
[23:32] of human resources and there is no or
there. The or does not come into play is
[23:37] in the event the department director is
not able to be present. So I I keep
[23:42] hearing that the department director
there's alternatives, but there's not.
[23:46] That is a clearly defined sentence where
two people that they're asking to be
[23:50] there. My second comment or I want to
get clarity around what exactly are you
[23:54] asking is the participation of human
resources. It does not define what that
[23:59] needs to look like. It does not say she
has to be present. It says she has to
[24:04] participate. Her participation could be
that she provided a training. her
[24:09] participation could be that she came in
and sat in the first part of the
[24:14] interview and then she may have to
leave. It does not say and it also does
[24:19] not say that the human resources
director is actually making the
[24:23] decision. She is not one of the voting
members. She's only there in presence to
[24:28] protect the city. So, I guess where I'm
really concerned is why we're stuck on a
[24:33] word that does not define her role or
position in a hiring opportunity.
[24:39] » Okay. Yes, ma'am. So, and again, this is
interpretation of whoever's reading
[24:44] whenever it said must include the
participation of human resources and
[24:48] this is an updated version than the one
we got before because the one before did
[24:51] say human resources director I believe.
>> Uh it just said human resources. Okay,
[24:55] then that's my mistake on the department
director or their design. uh the
[24:59] department director or their designate.
I thought that you just said right now
[25:02] that if the department director couldn't
make it, they could send someone from
[25:06] their staff. Did I hear you say that
correctly?
[25:10] » Correct. So, it's basically human
resources. It's the department head and
[25:14] we typically have a panel of three
people. If if there is a supervisor or a
[25:18] manager within that department, that
person, you know, for the most part is
[25:23] there so they can give feedback to their
department head. Um after we do the
[25:28] interviews then everybody has to submit
you know a summary of who their
[25:32] selection is and why. Then that
information is then forwarded over to
[25:35] the city manager who has the final say
so as to who is actually selected.
[25:40] » Okay. So according to this language of
must include the participation of human
[25:44] resources as Dr. Clark was asking for
clarification. This did not mean human
[25:50] participation and this policy was
written in regards to you might just
[25:54] provide a training andor a manual and or
a book. So the the message behind this
[26:00] or the interpretation does not
necessarily mean a person from human
[26:03] resources. Is that accurate? Because I
believe that's the question.
[26:07] » No, that's not what I said. What I said
was with the word must, there are
[26:12] variations in how that can look. we're
getting stuck on a word that is slowing
[26:17] down a process. But then what you were
saying was that we were not inviting the
[26:23] department director and that's not what
the language says. The language says
[26:26] that at least those two people in
whatever that capacity looks like has to
[26:31] be there. What I hear you I think what I
hear you're saying is that you want to
[26:36] have bulleted opportunities to clarify
the must because if you're going to use
[26:42] your word interpretation must does not
mean she has to be present. Must means
[26:48] that there is some level of involvement
from HR but just the fact that she's
[26:53] pulling applications to provide us an
opportunity to even select a candidate.
[26:58] She has to be involved. You cannot hire
someone without having the influence of
[27:04] human resources. So I guess where I'm
really trying to gather in this moment
[27:08] and in this space is what exactly do you
want? Do you want to remove the word
[27:13] must or do you want us to clarify must?
Because we're just circling the wagons
[27:18] on a word and we're not moving forward
and the goal is to move forward. So, I
[27:22] guess if you would take a moment and
define exactly what you want, then we
[27:27] can give you an answer or take a vote so
we can move forward because I'm I'm
[27:31] really having a rough time sitting here
getting stuck on the word must.
[27:35] » Okay. And so, just for my own
clarification to provide that, I'm just
[27:40] going to reask what I think I already
asked. When you read must have the
[27:43] participation of human resources and the
department director of their design,
[27:47] does the department director have to be
there? Yes or no? based on that
[27:50] language.
>> It's either anybody from HR is there.
[27:54] It's either me or Felicity,
>> but it's not always me.
[27:57] » Okay. And I'm just talking about
department director. I'm sorry. I wasn't
[28:00] even referring to human resources. I was
just talking about that department
[28:02] director part. That was the question is
based off of that language. It is
[28:07] someone from human resources involved.
And it sounds like in person, not with a
[28:10] book or a training. And it is the
department director or their design.
[28:14] They might send someone else. So someone
it could be two or more but the must
[28:20] would be HR would be there may or may
not be the director and so my
[28:24] clarification of the must was turning
that around. Is there a possibility that
[28:29] the director must be there and it may or
may not include the support of HR to be
[28:33] there with them. That's the one specific
question
[28:38] about the word must. I think that would
depend upon the department director
[28:41] again or their designate. If it was in
say public works and and I don't know
[28:45] your structure, but you have a
superintendent or you have a a
[28:48] supervisor or you might have multiple
panels. If it comes down to two and you
[28:53] need to do it again, maybe the director
doesn't feel like they need to be in the
[28:55] second round of interviews. So, Angela
knows the pulse of the department. She's
[28:59] obviously communicating with them
throughout this entire process and
[29:02] making sure that their needs are met,
make sure their answers are met, and
[29:05] that she's there to support them in this
role to make sure that they pick the
[29:09] most qualified applicant. I think this
statement clearly was just put in place
[29:14] to document a process that HR is going
to walk alongside the department
[29:18] director or their design within an
interview to make sure, and in all
[29:23] fairness, you know, when you're in
another department, your craft is not
[29:27] HR. your craft is public works or police
or marketing or whatever the case may
[29:33] be. So, it's very easy. You can have all
the training in the world. I have been
[29:37] sat interviews with extremely competent,
intelligent, well-versed directors and
[29:41] in the moment a question gets asked not
because they they wanted to go around
[29:47] any rule of compliance. It's just not
what they live and breathe. So, HR being
[29:51] in attendance is only there to support
them and rein things back in. And I'm
[29:56] assuming Angela and Felicity, they
monitor and they manage their time to be
[30:00] able to accommodate and it might not be
the whole interview. It just depends on
[30:04] that particular instance. So this policy
was just put in place to provide the
[30:09] boundary and the guideline that human
resources is going to walk alongside
[30:13] that department and that director
through this process to make sure they
[30:16] have the most qualified candidate.
>> Okay. Thank you. My next question is on
[30:21] page 20 though I guess if there's other
council members with feedback or
[30:26] direction on if change of any questions
that prior um is it does say that all
[30:32] employment is extended through human
resources all offers which is I
[30:36] understand standard HR is going to reach
out for the hiring process. I'm just
[30:40] curious if that um going back to the
posting of they may or may not be posted
[30:46] positions and going back to what our
city has faced in the past where maybe
[30:51] um HR has moved somebody into a role
without it being posted. And so is there
[30:56] something that's going to be added to
the language here that includes after
[31:00] positions are posted or um interviewed
for in regards to before extending the
[31:07] offer?
No, this this is just in reference to
[31:12] the actual hiring process that the
actual offer must come through HR for
[31:17] multiple reasons and then those are
conditional upon and the and the
[31:22] important part of this policy is that is
conditional upon successful completion
[31:25] of the background check, physical exam
when applicable drug testing etc. in
[31:31] terms of the application or the job
posting that was covered prior where we
[31:36] have already discussed this that would
be um normally internally and externally
[31:40] and again that's only put into place if
the situation arises where you know city
[31:45] management and HR feel that in a certain
instance or what if there is no internal
[31:50] well I guess there wouldn't be you could
cross but there might be an instance
[31:55] where again you have six very qualified
people who all would fit that role very
[31:59] well and they've all indicated
interest in that position, you would,
[32:04] you know, post that internally, go
through the same process and hopefully,
[32:09] you know, internally promote whatever
the case may be. But this only addresses
[32:14] the hiring process of the offer and then
that it's conditional upon those items.
[32:20] » Okay. So, it's just the paperwork.
Wonderful. Okay. And then my last
[32:23] question is on the page 2226 about uh
transfers and reassignments. Um, and
[32:30] again going back with some of the
history the city has had with different
[32:34] transfers and reassignments and when we
have ended up in the news, it says
[32:38] department directors may request a
promotion or a transfer prior to six
[32:42] months of service with a written request
to HR. Reassignments may occur as
[32:46] necessary to meet operational
requirements. So you could have uh, you
[32:50] know, some again anywhere from part-time
all the way up to city manager positions
[32:54] open, right? And so if you're looking at
reassignments, my question is about if
[33:00] uh directors are requesting a transfer
and if they are in department A and they
[33:05] want to request from a employee of
department B, do both directors of
[33:10] department A and B have to meet and
agree first before a transfer is
[33:15] initiated and approved?
And so because I know that that's
[33:19] something similar like for example in
the school system if I work at one
[33:23] campus and I want to transfer to the
other campus for another grade level or
[33:28] position both principles would have to
be in agreement of that transfer. So are
[33:33] both directors in agreement of transfers
or is it just one that says I would like
[33:38] for this employee to transfer to my
department and they can get permission.
[33:42] It would be inherently both departments
and then it would be requested through
[33:46] HR and approved by the city manager.
>> Okay. So both directors would be
[33:50] involved in the discussion and then they
would take it to HR and then it would be
[33:53] approved by the city manager would be
the process for transfer.
[33:57] » Yes ma'am.
>> Okay. Because the way that again my
[34:00] interpretation of the text is it it
sounded like just one director could
[34:04] just request a transfer to HR and just
take an employee and it may or may not
[34:08] involve the involvement of the other
director. the employee may have been
[34:12] working with. So that's all the
questions
[34:15] » director
>> I I would you know I would never want to
[34:18] put another employee in a department
with everyone wasn't in agreement. So in
[34:21] this case, yes, both of them would
agree. It's the right thing to do. It
[34:25] would go through HR. City manager would
approve. All is well.
[34:30] » All right. Thank you.
>> Okay.
[34:32] » You are so welcome.
>> Anybody else have any other questions?
[34:37] Any other comments?
[34:42] » Okay. Do I have a motion to
>> I would like to make a motion to approve
[34:46] the revised city of Cleveland employee
handbook.
[34:49] » Second. Okay. I have a motion by Miss
David. I have a second by Mr. Mwaters.
[34:57] Okay. Any other questions or comments?
[35:02] Okay. All those in favor.
[35:07] Okay. Motion carries. Seven to zero.
>> Thank you, council.
[35:12] » Thank you so much.
>> Okay.
[35:16] Okay. Now, we're going to move on to
item number four. Uh Uh, Mr. Mayor, uh,
[35:20] I'd like to make a motion that we table
number four as the dates.
[35:25] » I believe there's some confusion in some
of the dates. So, I make a motion we
[35:29] table number four.
>> Okay.
[35:31] » Okay. I have a motion to table item
number four, the road closure request
[35:38] for the Cleveland Athletic Booster
Glow-in-the-dark 5K funright razor on
[35:43] September 12th. Okay. I have a motion by
Mr. Mwaters and there's a second by Mr.
[35:50] Ward. Okay. All those any other
questions?
[35:54] Okay. All those in favor?
Okay. Motion CL caris 7 to zero. Okay.
[36:01] Uh item number five, authorize
amendments to the infrastructure
[36:06] maintenance agreement with McKenley
development for section 9 of Grand Oak
[36:10] reserves public improvements.
[36:15] Okay.
Uh, thank you, Mayor and Council.
[36:19] [clears throat] Millia Lavar.
>> There you go. State your name.
[36:21] » Millia Lavaro, director of community and
economic development. Um, so this is an
[36:26] item that we presented last at the last
uh regular meeting. Um, and so since
[36:33] then there's just been some um uh
amendments sought by the developer. um
[36:39] they didn't have very much time to
review the uh text when it was turned
[36:44] around um by staff in the city
attorney's office. So, in fairness, you
[36:49] know, that was kind of their first
opportunity to look over some of the uh
[36:52] the text. So, they just came back with a
few things. We've kind of outlined that
[36:56] in the staff report and it's certainly
there for you to review in the red
[36:59] lines. Uh but again, this can be kind of
summarized to they wanted to clarify
[37:04] when the effective date was going to
take effect. um and really u when that
[37:10] would start. And so there's a two-year
maintenance period outlined in this
[37:14] agreement. Uh and that would have that
would effectively start um uh take
[37:19] effect in November 25, which is when
they uh receive substantial completion
[37:25] for those infrastructure improvements in
that section of Grand Oaks. Um and then
[37:30] kind of they wanted to elaborate on the
kind of inspection process after that
[37:35] two-year maintenance. uh window and um
just kind of elaborate on some of the
[37:41] text that was there and kind of just
spell that out more clearly. And then
[37:45] they changed a few terms um like one of
them was detention facilities that's
[37:50] just generalized to improvements now
which is probably more broader in our
[37:54] favor. And then uh also wanted to change
uh you know it says initial payment that
[38:00] should really be the total payment for
this uh consideration um since this is
[38:05] in lie of bond shy bond for the
maintenance.
[38:10] So I'm happy to entertain any questions.
That was the synopsis of the amendments
[38:16] to the agreement.
[38:22] Any other questions?
Okay, if there are no questions,
[38:28] make a motion we uh authorize amendment
to the infrastructure maintenance
[38:32] agreement with McK McKinley development
for section 9 of Grand Oaks Reserve.
[38:36] » Second.
>> Okay. I have a motion by Mr. Magwaters.
[38:39] I have a second by Mr. Buckley. Any
other questions, comments? Okay. All
[38:44] those in favor?
Okay. Motion carries. Seven to zero.
[38:51] Okay. We're going to move on to item
number six. Approval of the final plat
[38:55] of Grand O Reserve phase 3 section 9
approximately
[39:01] uh 9171
[39:05] acres situated in the Joseph Finner
Survey abstract number 441
[39:14] Cleveland Liberty County, Texas.
generally located along Pine Ben Court.
[39:22] » Um, correction, apologies. So, I was
just looking at that last bit. So, this
[39:27] is generally located um along Grand Oaks
Boulevard
[39:32] » uh that was just left over from uh a
recent plat case, but this is the kind
[39:37] of sister uh item to the the maintenance
agreement that we just looked at. And so
[39:42] this was kind of the the maintenance
agreement um was the last thing that we
[39:47] needed in order to comply with our
subdivision ordinance that would allow
[39:50] us to move forward with the final plat
for this section uh of Grand Oaks. And
[39:56] so this section would provide for 20 uh
45 lots, four blocks and nine reserves
[40:02] called Grand Oaks Reserve Phase 3
section 9 final plan. So staff has
[40:07] reviewed it. We do recommend approval.
Uh we do happy to answer any questions.
[40:17] » Make a motion we approve item six.
[40:23] » Okay, I have a motion and a second on
the table. Any other questions?
[40:29] Okay, no questions. Uh
all those in favor?
[40:35] Okay, motion carries seven to zero.
Okay.
[40:41] Okay. We're going to move on to item
number eight.
[40:47] Okay. Seven. Okay. Hang on. I'm thinking
Oh, one's cut off on my sheet here.
[41:03] Okay.
Okay. Sorry about that.
[41:08] Okay. Uh, second reading of a resolution
authorizing real property acquisition
[41:14] project of the Cleveland Economic
Development Corporation for acquisition
[41:19] of real property and property
improvements.
[41:25] Uh, thank you, Mayor Council. Again,
Amelia Lavaro, director of community
[41:28] development, uh, community economic
development. So again, uh at the most
[41:33] recent regular meeting, we did have a
first reading of this item and this is
[41:37] the uh statutoily required second
reading uh in order for um these funds
[41:43] to be utilized for this purpose for this
recently designated project. Uh but
[41:48] yeah, this you know resolution kind of
or just uh generally kind of recognizes
[41:53] the duly uh followed process and the
kind of authorization of the funds for
[41:59] these purposes. I don't know if there's
a discrepancy uh but the dollar amount
[42:03] in question u is2,000
294,500
[42:10] u dollars
[42:16] happy to answer any questions and this
is related to the following item as well
[42:27] » reading so we need to make a motion to
adopt.
[42:30] » Yeah.
>> The resolution.
[42:32] » If there are no other questions,
[42:42] » you're talking about
>> Well, there technically there is a
[42:46] second reading of this. There's a
resolution.
[42:48] » We need to approve the second reading,
>> right?
[42:50] » Make a motion we approve the second
reading of the resolution authorizing
[42:53] the real property acquisition product of
the Cleveland Economic Development
[42:56] Corporation.
>> Second. Okay, I have a motion and a
[43:01] second. Motion by Mr. Maguat, second by
Mr. Buckley. Any other questions?
[43:08] Okay, all those in favor?
Okay, motion carries.
[43:14] Seven to zero. Okay, we're going to move
on to item eight, a resolution approving
[43:20] and authorizing the EDC board president
to execute a p purchase and sale
[43:26] agreement for acquisition of uh 5165
acres of real property legally describe
[43:35] lots 11 through13 block one in the
original town of Cleveland. Block one,
[43:43] Cleveland, Liberty County, Texas.
Thank you, Mayor Councel. Again, this is
[43:50] related to this uh second reading of
that that resolution. Uh this this item
[43:56] is really pertaining to just the actual
um execution of that purchase and sell
[44:01] agreement. So, the last one was kind of
the funding. This is more the um actual
[44:05] transaction. So again, this would help
us uh secure uh some property uh in
[44:12] Cleveland to be used for authorized um
uh projects as relates to uh parks
[44:21] projects.
So happy to answer any questions if you
[44:24] have any.
[44:31] Make a motion we approve item eight.
Resolution approving the author in
[44:35] authorizing EDC board president to
execute a purchase and sale agreement
[44:38] for the acquisition of 5165 acres real
property.
[44:44] » Second. Okay. Have a motion by Mr.
Buckley.
[44:48] Second by Mr. M. Waters. Any other
questions?
[44:52] Okay. All those in favor?
[44:57] Okay. Six. Okay. Motion carries. 6 to1.
Okay. Thank you, Emilio. Okay. Item
[45:05] nine, approval for staff to move forward
with the replacement of uh two mixer at
[45:13] wastewater treatment plants.
[45:20] Good evening, mayor and council members.
I'm requesting council approval for
[45:27] staff to move forward with the
replacement of two mixers for the
[45:31] wastewater treatment plant.
These mixes are critical component for
[45:36] this for the treatment process.
So the idea is
[45:44] one was covered under insurance because
it has n natural damage happen with the
[45:48] weather and so forth. So that would be
covered under insurance.
[45:52] The other one we are asking for to
purchase
[45:57] for bid which we we we recommended h
equipment for that for that purchase out
[46:04] of the three recommended h equipment to
purchase these uh
[46:09] these mixes for the wastewater plant.
>> So the original estimate they didn't
[46:16] have their taxes included on it.
Yes, the original is correct. It's just
[46:23] that the other one, which I should have
stated, the other one was covered on the
[46:27] insurance and it would cover the other
one and the the existing one that I'm
[46:33] asking for, we'll pay for that auto
prom, this was something that y'all
[46:38] voted on last council. Um I think when
he just got up, we kind of misspoke and
[46:42] said it was just going to be one. It is
two,
[46:44] » but one of those will be fully covered
by the insurance proceeds. So we just
[46:48] wanted to bring that back to make sure
that
[46:51] what y'all approved.
>> Okay. Not a small question.
[46:57] » Make a motion to approve for staff to
move forward with replacement of two
[47:01] mixers at waste water treatment plants.
>> Second.
[47:05] » Okay. And a motion by Mr. Buckley. I
think a second by Miss David. Okay. Any
[47:11] other questions?
Okay. All those in favor?
[47:17] Okay. Okay. Motion carries seven to
zero. Okay. Item number 10. Uh
[47:24] discussion on proposed fiscal year 2026
2027
[47:30] budget.
Mr. Typton.
[47:34] » Thank you, Mayor Councel. I brought my
expert with me today. So,
[47:43] » she might not be happy with me.
[47:52] » So, we are currently still working on
the TNT worksheet. Um
[47:57] Pam has been on that all day today.
There's some numbers we're still going
[48:00] back and forth with the county on. So,
hopefully we'll have something with
[48:03] y'all for that for y'all shortly on
that. Go next.
[48:10] So, this is just a general snapshot of
the two main um
[48:14] revenue streams that we have for the
city, which again is your the taxes and
[48:18] the sales tax.
[48:22] Again, I think there was probably some
misinformation or something maybe online
[48:26] about this. Again, it was the projection
of what the sales tax was going to be
[48:31] versus what we brought in. So that
there's no bearing on the city
[48:35] whatsoever. We can't control sales tax.
We go to the next slide. This is the
[48:41] total general fund revenues for
everything. So you still see property
[48:44] tax, sales tax at the beginning. All the
rest which is your franchise taxes,
[48:48] pilot, license, and permits. That is the
total
[48:52] revenue stream. So you can see obviously
at the bottom it's 301,940
[48:58] which is again over total revenue.
[49:08] Pam and I sat down and we went through
every single line item that we had. We
[49:14] were able to cut a few more areas and
locations.
[49:17] Those would be some other operating
supplies as furnitureures and fixtures.
[49:21] Um, we were able to balance the budget
currently. And this right here kind of
[49:26] just shows you, you know, your far right
line item will tell you the parenthesis
[49:31] is what we had taken away from that like
administration. You'll see 55,000 was
[49:36] removed. um some of the larger ones you
see, and Pam, you could probably go
[49:41] further into this,
but like we said, the um water and sewer
[49:47] funding, we removed some employees that
were in that percentage- wise and moved
[49:52] them back into the general fund. So,
that's why you see the the cost
[49:56] difference there. So what he means by
that is that we had um uh employees in
[50:02] the parks department and our garage
department that were budgeted out of
[50:06] water and sewer. Um after speaking with
our financial advisor, it was his
[50:12] recommendation that we justify the
transfer from water and sewer. So in
[50:16] doing that, we wanted to make sure that
everything that's allocated to water and
[50:20] sewer should be there. So part of the
increase that you'll see in water and
[50:25] sewer is because we removed employees
that were not water and sewer employees
[50:30] from the water and sewer budget.
[50:35] Important.
[50:40] This again is going to reflect your
total revenues versus total
[50:43] expenditures.
So your proposed budget, we're sitting
[50:46] at zero.
Total is 12,000 or 12,430,221.
[50:55] These are our debt obligations. Our
current debt obligations are at the top.
[50:58] Our next year was going to be reduced
for our bonds and reduced for water and
[51:03] sewer. And again for the total debt for
next year is 2,379,329.79.
[51:14] I wanted to highlight again, you know,
the the ability of the staff to reach
[51:18] out and get a lot of grants for the city
and the total amount is 37,75127
[51:25] worth of grants. City matching to that
is 8,720,000.
[51:31] I think it's a very
noble effort to try to save city
[51:37] taxpayer money with that. And that's a
lot of money they went in and got with
[51:40] some very little match money. Again,
[51:47] this is just kind of a recap from
previous medical insurance for a new HMO
[51:51] plan was introduced and it also
introduced a fixed employer
[51:54] contribution. Um, it did save the city
money upwards of $165,235.
[52:01] Those general increases are what we had
to do in the budget were for property
[52:05] insurance, electricity, natural gas,
street lights, gas equipment
[52:08] maintenance, and vehicle maintenance.
[52:13] These again were the ones that we
proposed that are going to be
[52:15] reoccurring for the following budget. So
these are the ones that will stay
[52:19] ongoing. These are not the onetime
costs.
[52:26] And then these are your onetime
purchases. So these are mainly all of
[52:28] these are what comes out of your general
fund, your fund reserves. I want to make
[52:32] sure I say that right. Fund reserves.
>> That's the uh fund balance. The reserves
[52:36] is the 25% that's required by law. We
keep 25% of operating. So if you have a
[52:42] $12 million budget, you're required by
law to keep 25% of that, which would be
[52:46] three million that we cannot touch. So
that is in the reserves. Um as of last
[52:52] year, uh 25 audit, we were at 72% which
equaled um 8.9 million um 72% of our
[53:02] reserves, which that 72% means that
we're 72% of what it takes for us to
[53:06] operate. So it takes us 12 million to
operate. 72% was that of that is 8.9
[53:11] million. With the projections for this
year, we're trending to hit 2 to utilize
[53:16] $275,000 out of reserves for this year,
which will leave the fund balance at 8.7
[53:24] million. And then we have allocated in
the budget for next year 697 million. I
[53:30] mean, sorry, 697,000.
>> Oh, okay.
[53:33] » Call things. Okay. 697,000
out of the reserves of that the $500,000
[53:40] firet truck that was approved during
this year will not be received before
[53:44] 9:30. It won't be completed. So we
carried that over to the budget for 27.
[53:49] So we're actually whereas last year we
utilized 300
[53:54] 300 something,000 last year three
sorry about
[54:00] it was about 300,000 373. Yes. We
utilize 373.
[54:06] We're only utilizing in in addition to
the 500,000 for the firetruck 197. So we
[54:12] have decreased the amount that we're
pulling out of reserves, but the fire
[54:16] truck is included in that 697. So once
we subtract the 697 from the 8.7, that
[54:22] will leave us with a little over 8
million, which is 65% of reserves. And
[54:27] the law only requires that we keep 25%.
I don't want it to get down to 25%. So
[54:32] I'm not just spending money to
>> we at 65%.
[54:37] » That's an estimate.
>> And the law requires us to be
[54:41] » at 25%. That that's what the charter
says and the uh state law and our
[54:46] charter is in line with the state law.
So we're required to keep 3.1 million
[54:50] and we're estimating best guess of
current if anything happens this number
[54:55] can change is 8 million21 at the end of
fiscal year 27. that but that depends on
[55:01] the property tax revenues that depends
on the sales tax revenues that depends
[55:05] on the de um uh economic development uh
development services the permitting
[55:12] those are the big three biggest um
revenue streams that the city has and
[55:16] those are things that we really can't
control as far as property tax we have
[55:20] the packet that y'all have it was built
off of what we had at the time I will
[55:25] tell you now I have been here since six
o'clock this morning working on this TNT
[55:29] And that is going to change. We um the
TNT worksheet that I received on the
[55:34] 28th of August um said that the no new I
mean the voter approval rate which is
[55:40] the highest rate that the city can adopt
without going to the voters was 79%. We
[55:46] did uh 79% 79 cent. Sorry I'm exhausted.
79 cent we did a not to exceed rate of
[55:54] 75 cent. If we're wanting to adopt 79,
we're going to have to start the process
[56:01] over with the publications and the um
record vote where you guys vote on it
[56:07] and everything. The issue with that is
the values decreased. The property tax
[56:13] uh the certified appraised values have
gone down. I'm working on this today.
[56:19] Last year's values were 829 million and
this year's taxable value is 719
[56:26] million. The only way you make up for
that difference is by increasing the
[56:30] rate keep increasing the tax rate which
I did not want to do. Last year when we
[56:34] corrected the rate for the debt service,
we had an excess collections of
[56:38] $800,000.
Spoke with the tax assessor collector.
[56:41] He was worried that that rate wouldn't
work. And I reassured him we collected
[56:45] everything we needed and more. So, it's
not 800,000. It's better than what it
[56:50] was, but you're never going to hit the
nail on the head with that because you
[56:52] don't know how many residents are going
to pay their taxes. You don't know
[56:55] exactly what the appraised values are
going to be after they go to the
[56:58] appraisal review board. So, there was a
decrease in revenue. One of the main
[57:02] things was, I believe it was House Bill
Nine, House Bill Nine, um that increased
[57:08] the personal property exemption from
2500 to 125,000. There are 425
[57:15] properties that are in one of those
codes. There's four of them, but 425
[57:20] properties that have an exemption of 23
million that they did not have last
[57:25] year. And then there's um three more
that total up to a total of about 30
[57:29] million that we are now exempt. They're
exempt from paying the property taxes.
[57:34] So the personal property basically that
is a business that has um contents that
[57:40] they use to for profit that they're
going to utilize to um operate the
[57:45] business resell or whatever it may be.
So the for an example you can use
[57:50] Walmart 125,000 is nothing inside
Walmart but that's an exemption that
[57:54] used to be at 2500 that is now 125,000.
These are numbers we can't control. I
[58:00] have worked um tirelessly with the
Liberty CAD and the tax assessor to
[58:06] ensure that the information that they're
giving us is uh correct. We are limited
[58:10] as a city as what we can request for the
CAD because requesting them to change
[58:15] the appraised values is illegal because
that benefits us. I just want accuracy.
[58:19] Is this correct? So I I reached out to
some colleagues uh outside the city.
[58:24] They told me what information I should
request and I have requested that
[58:28] information.
um
[58:31] based off of what it is that you guys
want to do. If we're going to stay with
[58:34] the 75, which will create a budget
shortfall, we balanced it um with this
[58:39] one. We worked on that, stayed late, got
it in balance, got these numbers on the
[58:43] 28th, which was after the budget had to
be um provided to you guys. And um based
[58:50] off of that, we have another shortfall
of about 300,000 because of property
[58:54] tax. It has nothing to do with sales
tax. Well, yes and no. Sales tax also
[58:59] affects property tax. I want y'all to
understand that because sales tax um a
[59:04] portion of the city sales tax one6 25%
out of a$150. So if you look at the $150
[59:09] as quarters, it takes six quarters to
make a $150 take one quarter which is
[59:14] one6th of it goes to uh portion goes to
EDC, a portion goes to property tax
[59:19] relief. So once we when the um the more
we collect in sales tax, it lowers the
[59:25] property tax rate because it relieves
the citizens of having to pay property
[59:30] tax based on the more sales tax we
generate. When the sales tax decreases,
[59:35] that property tax rate now goes up
because the sales tax relief is now
[59:38] lower. So it's an inverse relationship.
So that's another thing that's affecting
[59:42] this rate because pro uh sales tax is
has uh gone down in the last year. So
[59:48] that's something that we're looking at.
Um,
[59:51] I I need direction. Uh, we can start the
public uh publications over. Um, if
[59:57] y'all are interested in going to the 79,
um, I was not expecting the taxable
[1:00:02] value to decrease in the way that it
was, that's not something I can control.
[1:00:06] But the 800,000 when we had that excess
collections last year, I worked on the
[1:00:12] spreadsheet and I said, what does it
look like if we if all things stay
[1:00:16] consistent and we remove the 800,000?
was maybe two cent increase that we
[1:00:20] thought we would go back up to have to
make up for debt service payments. But
[1:00:25] with the decrease of the 800,000 plus
the decrease in the taxable value, we're
[1:00:30] having to do uh a higher rate than 75
cent if we want to be able to collect
[1:00:37] enough to not have a deficit.
So
[1:00:40] » So just to be clear, just just to be
clear, staying patents
[1:00:45] creates about a 300k shortfall.
>> Yes. to the bank.
[1:00:48] » Yeah.
>> Yes, I do have that. Um, a part of that
[1:00:51] is I have it here. Give me one second. A
portion of that is uh attributed to the
[1:00:57] sales tax. We originally the package you
have has a revenue of 3.7 million. That
[1:01:04] 3.7 million was calculated based on um
the three and a half%. Okay. So the law
[1:01:11] allows for us to increase revenue for
sales of property tax by 3 and a half%
[1:01:17] each year. So our projected revenue is
3.4 million. If you add three and a
[1:01:23] half% to that, that gives you a number
and then the new property is not part of
[1:01:28] that calculation. New property is not
subject to the cap. So what I did was I
[1:01:32] took that number, added three and a half
to increase it. Then I took the new
[1:01:35] property value and multiplied it by the
um estimated tax rate and that's where
[1:01:40] we came up with the 3.7 ran it by Lee.
We it made sense. That's what we move
[1:01:45] forward with. Well, because the tax rate
has to be higher to generate that uh the
[1:01:51] three and a half% it also increases the
amount that goes to the TUR. If we tax
[1:01:56] on 63 cent, the TUR gets what's in the
slideshow about 275 and 215,000.
[1:02:02] If we go up to 70 uh 75%
75 75 cent the TUR is now getting
[1:02:11] 308,241.
So it's like even though we increase the
[1:02:15] rate the TUR is still going to their um
allocation is going to increase as well.
[1:02:21] So with all of those things in play, the
deficit is now the 320. But it's not
[1:02:27] just the property tax. It's the property
tax minus the tourist that increases as
[1:02:32] well.
>> I'm going to piggy back off of uh Mr.
[1:02:37] McWater's question there. Um staying at
the 75 cents that we discussed in the
[1:02:42] last meeting with about the 300,000
budget shortfall. Is there a plan to
[1:02:47] balance that?
>> We are required to balance it. That's
[1:02:51] the direction that I'm needing because
we you we can't adopt a you can adopt a
[1:02:55] budget that's not balanced but that
would require us to go into fund balance
[1:02:58] which you don't want to do for
reoccurring costs. So we can either go
[1:03:02] back out to for the restart the
publication requirements and uh vote on
[1:03:07] a higher rate or we can try to make some
more cuts. And that's the next part or
[1:03:13] part B of the question because then my
next question was uh would cuts be made
[1:03:17] first um in the process and would that
be off of we had some supplementals that
[1:03:23] were requested and so I'm just curious
if we are looking at cuts first and if
[1:03:28] supplementals would be cut first to
continue operations of what had been
[1:03:33] already um budgeted or like what is that
potential plan if it stays at the 75
[1:03:41] Courtney, can you go back one slide?
>> So, essentially, aside from those that,
[1:03:47] you know, I say non-discretionary like
electricity and property insurance,
[1:03:51] these are your supplementals.
That that's that's the only thing we've
[1:03:55] added to the budget. That's it.
>> We didn't add any positions.
[1:03:59] » Well, one's in water, sewer.
>> That's the
[1:04:02] » That's the transfer over.
>> No, the the water and sewer position
[1:04:05] that's added is being funded out of
water and sewer. Water and sewer is
[1:04:09] their own fund. When you look at your uh
packets, the budgets, it says general
[1:04:14] fund 100. That's I call when I talk to
my team, I tell them that's our bucket.
[1:04:19] That's one bucket of money. Fund 300 is
another one. Fund 300 is funded by
[1:04:24] everything that uh is generated out of
the water office. It's like a um
[1:04:28] enterprise fund. It's a for profit. So,
it's the water bills, the tap fees, the
[1:04:34] late fees, everything water and sewer.
So the position for water and sewer is
[1:04:39] 100% covered out of water and sewer
revenue. It does not it's not property
[1:04:42] tax or sales tax related.
>> Okay. Um and just to summarize this last
[1:04:48] year were we at 62 or 63 cents.
>> 63.
[1:04:52] » We're at 63. So, we're looking at either
moving from 63 to 75, which would
[1:04:57] include a shortfall, and there would
have to be additional cuts, or we're
[1:05:02] looking at direction of potentially
going up to 79 cents, because we can go
[1:05:07] all the way up to 79 without voter
approval.
[1:05:09] » Yes.
>> Okay. And I got one other question, not
[1:05:12] related to the rate. It's what you said
about the fund balance, having a healthy
[1:05:15] fund balance that we're only required
25%. Um, I believe y'all posted
[1:05:20] something on your social media not long
ago. Didn't y'all get accolades for like
[1:05:24] a double A or AAA bond rating?
>> Bond rating increase.
[1:05:27] » Okay. Um, does going down to 65% though
that's still above our minimum and it's
[1:05:32] great. Does that affect that rating at
all if you dip to 65% from wherever you
[1:05:37] were at?
>> I cannot answer that with decisive like
[1:05:40] definity, but I do know that the rating
is not often. So things could change
[1:05:44] between now and the next rating. It's
not rated annually. I believe the
[1:05:48] paperwork that I saw said the last
rating was maybe 2017. Don't quote me on
[1:05:52] that, but I went back through my files,
the uh electronic files that we have to
[1:05:56] see when the last information was
submitted for that rating and it was
[1:06:00] maybe five years ago.
>> Okay. And that's the only reason I asked
[1:06:03] about that because I knew y'all had
worked hard for that rating and it was
[1:06:05] going to contribute to the financial
health and I just didn't want to make
[1:06:09] sure that something would make us go
backwards in that.
[1:06:12] » No, but they won't come back and rerate
us based on that. But it is something
[1:06:16] that you don't want it to be a trend,
right? Because we if you look at the
[1:06:20] last five years, it did kind of trickle
down and then it came back up. So,
[1:06:24] » okay. Thank you.
>> Oh, and I will say also when it comes to
[1:06:29] cuts that we did have public works who
agreed to freeze two positions for six
[1:06:33] months to help with the deficit. So, we
are doing everything we can to ensure
[1:06:38] that we're being as uh fiscally
responsible as we can. I don't know
[1:06:43] » where else we can shave off. Just to
give it a history, I believe it was 77
[1:06:46] before it went to 63. Correct.
>> Yes. Yes.
[1:06:50] » And the reason why it went down to 63
was because of the excess we've had in
[1:06:53] our interest in sinking. And so we
understood that it was going to
[1:06:56] eventually go back up after that once we
align that because
[1:07:00] » you're not supposed to keep that much
money in your
[1:07:02] » tinus.
>> So we knew it was going to go up, but I
[1:07:05] think,
you know, this year, you know, I kind of
[1:07:09] told Pam earlier, I think it was kind of
the double whammy. You got the the bill
[1:07:13] that hit us from 2500 to 125,000 and
then of course sales tax and
[1:07:19] » they both kind of played on our current
situation
[1:07:23] » and and that sales tax situation is just
not here in Cleveland. I mean it's it's
[1:07:30] everywhere with the prices, you know, on
the on the gas, the groceries, I mean
[1:07:37] you name it. So, uh, hopefully we can
have a better year, uh, next year on the
[1:07:43] sales tax.
>> And, and just to be transparent on the
[1:07:46] sales tax, we do, um, contract with HDL.
They do sales tax audits for different,
[1:07:52] uh, entities. And I reached out to them
to get a better explanation of the
[1:07:57] shortfall because for the last two
years, prior to this year, for fiscal
[1:08:01] year 25 and 24, we collected $800,000
more than what we budgeted. So we
[1:08:08] assumed that trend would uh continue
because we have the growth in the two
[1:08:13] tures. We have the growth south of us to
where a lot of those people shop here
[1:08:17] and um we assume that that would be the
trend. Well for whatever reason um it is
[1:08:23] not. We had some development that slowed
a lot of times. Uh what people don't
[1:08:28] understand about sales tax, it is paid
to the destination point. So if somebody
[1:08:33] in New York orders something and ships
it to you, we get the sales tax for
[1:08:36] that. That's why the sales tax when
you're placing an online order is not
[1:08:39] calculated until you get ready until
after the address is put in. So we
[1:08:44] collect that. We did have some
collections that were due to audits. So
[1:08:47] those were one-time payouts that were
thought to be just a an upward trend an
[1:08:53] upward trend because we did have like I
said in excess $800,000 for two budget
[1:08:58] years. So it it was different factors
that played a role in it. It's not just
[1:09:02] a decrease in sales locally.
That makes sense.
[1:09:14] What is council's um appetite on
changing the rate? Are we moving f
[1:09:20] forward with the 75 because we have to
come back.
[1:09:28] Are we individually giving our opinion
or collectively?
[1:09:31] » This is not an official vote. If we are
starting over, we have to do a um the
[1:09:36] record vote would have to be I'd have to
start over and do the official
[1:09:38] documentation and everything.
>> We have to essentially come back and do
[1:09:41] another special council meeting to do to
suspend the 75 and introduce the 79
[1:09:46] cents.
>> But there wouldn't be any additional
[1:09:49] extra action so to speak if we stayed
75. Oh, just just the adoption on the
[1:09:55] 15th.
>> And this is what we have today. Um the
[1:09:59] tax assessor is out of the office. I've
been talking to him on the cell phone
[1:10:02] today. He'll be back on Friday and I'm
going to go line by line with him to
[1:10:07] ensure that what we have is accurate.
>> But if we stay at the 75 that increases
[1:10:14] we end up with a new deficit.
>> Yes, it's the 320. We'd have to cover
[1:10:19] » do additional cuts. But you have a plan
for that deficit like freezing the
[1:10:22] positions that you mentioned.
>> The the freeze is in what resolved the
[1:10:26] previous deficit that was presented at
and I think I think that's really
[1:10:30] important uh to note Pam. um they did a
lot of work because the original
[1:10:37] shortfall in the sales tax as you
remember from last meeting was 600,000
[1:10:41] » and they went through line by line and
and did some pretty pretty significant
[1:10:45] cuts to balance that
>> without having to do the dip in that
[1:10:49] they were. So they're I mean they they
definitely, you know, applaud y'all.
[1:10:54] Y'all did a lot of work to eliminate
that. And I know this was a definitely
[1:10:58] news that no one no one wants to hear,
but uh but yeah, that's that's where
[1:11:02] we're at. We last month when we were
here, we had a or few weeks ago, we were
[1:11:06] at a 600 shortfall and now we're at 320
is basically where it's at. But y'all
[1:11:11] went through a tremendous amount of cuts
already. Essentially, what was presented
[1:11:16] when we say balanced budget, that was at
the 70 uh 75 because that's what we had
[1:11:21] TNT wise. getting that new information
and now at 79. That's where it comes in
[1:11:27] now to where if we don't go to 79, we're
at an additional 300 shortfall that we
[1:11:31] would now have to go back and fix that.
>> Well, I don't know if we're individually
[1:11:37] providing our opinions. I know this is
just direction, but I'm going to go
[1:11:40] ahead and just say my opinion is to
stick with the 75 before trying to
[1:11:44] increase the 79 for our residents. So,
my vote would be in favor of maintaining
[1:11:48] the 75 and looking back at where we
might have to cut additionally.
[1:11:57] Yeah, mine's a 75 also.
>> Yeah,
[1:12:01] » I say 75.
But I think you know in a it's it's not
[1:12:06] good but then again u
[1:12:12] you know this council
you know uh we inherited you know our
[1:12:18] predecessors
you know uh they've always been very
[1:12:23] conservative
you know with our with our money. So,
[1:12:28] uh, we can we can withstand some of that
because see, back in the day, we didn't
[1:12:32] have any cushion. I mean, some of the I
think Chief Brousard and Anderson and
[1:12:38] Miss Conn could probably remember some
of those days where we didn't have any
[1:12:42] any leeway at all. But uh you know we we
can uh I just rather stay with that 75
[1:12:50] and uh we can you know cut back whatever
we can cut back. But uh and look forward
[1:12:56] to next year you know with this uh
whatever they call the affordability
[1:13:00] thing you know with the gas and and the
and the groceries and and uh pretty much
[1:13:06] everything you know prices are high on
everything. So,
[1:13:10] » and and just as a reminder, um, and I
think this is worthwhile for everybody,
[1:13:15] our our all the public to understand,
>> going down to 63, we all knew was a
[1:13:21] one-time thing because of the overage.
>> We didn't know what it was going to look
[1:13:24] like.
>> We didn't know exactly what it was going
[1:13:26] to look like, but that that we knew that
was going to be a one-year relief. Uh,
[1:13:31] and prior to the 63, we were at
>> 77 years and then 78 for one.
[1:13:37] » So, so just to just to kind of put that
into perspective, we're still coming in
[1:13:42] at 75 better than than what we were the
previous two years before we had to go
[1:13:47] down last year.
>> Mayor,
[1:13:49] » yes.
>> I just want to add because I want to
[1:13:51] make sure that and and Brett, I'm so
grateful that you lifted that point
[1:13:55] because that was a point that I was
toying within my mind. I want to make
[1:13:59] the connection to the information that
was shared because I want to ensure that
[1:14:02] we don't get misinformation. So when you
talk about the fact that we had that
[1:14:07] one-time purchase, I want to connect
that to the statement about our
[1:14:10] financial readiness. And so when and I
know you were very conservative in your
[1:14:14] response, but I want to say out loud
that when those agencies look at our
[1:14:19] financial readiness, they actually
applaud you for what you did because you
[1:14:23] recognize that there was a one-time
expense of the fire truck, the police
[1:14:27] car, whatever it was that we had to make
a conscious decision to make. We made
[1:14:32] that and now we have the opportunity to
increase that back. So the rating is not
[1:14:38] going to penalize us for making a
one-time decision. Now, if you were
[1:14:42] doing that because we had to
consistently cover bills that we did not
[1:14:46] anticipate and we did not forecast, then
they would hold that against us because
[1:14:51] then you're not being good financial
stewards of the money. Correct?
[1:14:54] » But I want to make sure that we're clear
that there's no misinformation. Our
[1:14:59] financial rating is not at risk because
of this one-time purchase that took us
[1:15:04] from a 77 to a 62.
>> That's actually that's two different
[1:15:08] things. The 77 to the 62 is the property
tax rate. Okay. The 600,000 is a onetime
[1:15:14] » 694. Yes. That that is not that does not
affect us negatively because the you can
[1:15:21] allocate one time cost fund balance
because fund balance has to be used for
[1:15:25] something
>> for something because you can't just
[1:15:27] continue to.
>> Yeah. No, it would that it's uh the best
[1:15:31] option, the best practice is to use it
for one-time expenditures because when
[1:15:36] ongoing costs are allocated to the fund
balance, you're going to deplete your
[1:15:40] fund balance.
>> Exactly. So, I just wanted to make sure
[1:15:42] that we didn't get a misunderstanding
about our financial rating because that
[1:15:46] wasn't really connected in the moment,
but I understand why the point was made
[1:15:50] because we were celebrating that we did
have a good financial rating, but yet
[1:15:54] one is not going to negatively impact
the other,
[1:15:57] » right? And the tax rate the the what
happened with the tax rate is that there
[1:16:01] were some um errors with the tax
calculation like know how else to say
[1:16:06] that but um there was excess revenue
collected in the INS INS was restricted
[1:16:13] to bond payments debt payments that's it
so over the course of May since the TUR
[1:16:19] since the TUR went into place we started
collecting excess revenue in the um debt
[1:16:24] service the INS fund and last year, you
cannot go back and um you have to
[1:16:30] certify the excess amount in the TNT
worksheet. You can only do that for the
[1:16:34] prior year. So, when I came on board and
I noticed it, it was left alone. And
[1:16:40] then, uh last year, I just kind of
fought it until we figured it out what
[1:16:44] was going on. And so it was like 800,000
at that time even though the prior year
[1:16:49] before that was in excess of 200,000
that we could only um no uh utilize the
[1:16:56] 800,000 for the prior year. You can't go
several years back to use this excess
[1:17:00] collection. So the $800,000 was put into
the TNT worksheet which significantly
[1:17:06] dropped that uh tax rate.
>> Yeah. Just for Yeah, just for clarity. I
[1:17:10] was just speaking of the tax rate
because it seems like it's a lot. Oh my
[1:17:15] goodness, we went from 63 cents per 100
to 75. But I just think it's very good
[1:17:21] for everybody to understand the context
of that. We we knew it was going to go
[1:17:25] up because we were running at 77 and 78
in years prior to this this year.
[1:17:31] » And so rebounding from the 63 to a 75
doesn't even get us up to where we were
[1:17:36] in 24 and 25.
>> Yeah. And I think that 75 wasn't that
[1:17:41] around 2018
we were at 75.
[1:17:46] » So we still you know ahead of the curve
you know from where we were. So, uh,
[1:17:53] but, uh, you know, going forward, we
just got to, uh,
[1:17:59] you know, look at that sales tax and,
you know, bring in some new businesses
[1:18:03] here. And, um, but it's going to get
better. And, and at the end of the day
[1:18:09] though, we are okay. I mean, we're not
in dire straits. We're okay.
[1:18:15] Could be better, but we're okay. And
it's been a lot worse in in previous
[1:18:21] years, but the city of Cleveland is in
good standing, good credit rating. Uh,
[1:18:27] you know, we had that $37 million and
and bond money that we're starting to
[1:18:32] distribute that you can see with the
lift stations and the work that we're
[1:18:37] doing uh in our public works. So, you
know, we we have a lot to, you know, uh,
[1:18:43] hold our heads up about, you know, and
and with that grant money, that was that
[1:18:48] was something that that's never been
done in Cleveland. And, uh, I think that
[1:18:52] the taxpayers will here within the next
year will really get to see a
[1:18:57] difference, you know, as we start to,
uh, spend that money, you know, and and
[1:19:03] apply that to to uh improvements, you
know, in our infrastructure. So, we're
[1:19:10] okay though.
>> Anything else?
[1:19:15] Thank you.
[1:19:19] » Okay. We don't have to take a vote
tonight, do we? Okay.
[1:19:25] That's
any other discussion?
[1:19:29] » Make a motion we adjourn.
>> Okay. I have a motion to adjurnn.
[1:19:33] » That's all adjourned.
Go on.