[0:05] We're going to go ahead and get this

[0:06] meeting started.

[0:08] This is a um

[0:10] City of Texas City

[0:12] uh budget workshop. We have to have two

[0:15] of these, and this is the first of two.

[0:17] The first one will be next week on

[0:20] August the 12th

[0:23] at 5:00.

[0:25] To begin with, we're going to start with

[0:26] roll call, starting with Commissioner

[0:28] District

[0:30] Two. Okay. Yeah, Commissioner Ward.

[0:32] >> Barbie Tucker, District 2.

[0:35] >> Brian Getsch, Commissioner-at-Large.

[0:36] >> Abel Garza, Mayor.

[0:38] >> Wade Johnson, Commissioner-at-Large.

[0:39] >> Chris Sharp, District 3.

[0:41] >> Jason Delgado, District 4.

[0:44] >> This is going to be a good meeting cuz

[0:46] this is the meeting we've all been

[0:47] waiting for, so we'll turn it over to

[0:48] the star of the show, Ms. Laura Boyd.

[0:52] Hold on, Ms. Boyd. Here comes Andre

[0:53] Natson. We have a full commission.

[0:58] » Thank you, Mayor and Commissioners. Um

[1:01] This is the first of two budget

[1:03] workshops.

[1:04] Um

[1:06] This is the the calendar so that you can

[1:08] get an idea of how this process works.

[1:11] Um late May, early June, um

[1:15] there's budget meetings between the

[1:16] department heads and the uh

[1:19] the mayor.

[1:20] And then uh phase two

[1:23] um

[1:24] July 10th was the deadline for the city

[1:26] to submit truth and taxation information

[1:28] to the county tax assessor.

[1:31] July 27th, deadline for the chief

[1:33] appraiser from the

[1:35] uh appraisal district to certify the tax

[1:37] rolls.

[1:39] And then on July 29th, the city received

[1:42] no new revenue tax rate and the voter

[1:44] approval tax rate statements and

[1:46] schedules from the tax office.

[1:48] And uh

[1:50] part of the um

[1:51] requirement when budget is being

[1:54] discussed, as you'll see um

[1:56] previously on the agenda was a taxpayer

[1:58] impact statement.

[2:01] And the

[2:02] it shows what the current adopted tax

[2:04] rate is, the

[2:07] no new revenue rate, and then once

[2:10] the commission has

[2:13] selected a proposed tax rate, that will

[2:15] be shown here as well.

[2:17] So, for the no new revenue rate for tax

[2:20] year 26, fiscal year 26-27,

[2:24] it's 0.497231.

[2:28] And the median taxable value of a

[2:29] homestead, $188,833,

[2:33] estimated annual tax bill $938.94.

[2:38] You might wonder, well, why is the no

[2:40] new revenue rate higher than than the

[2:43] current rate? Well, because the tax

[2:44] values went down.

[2:46] And uh

[2:48] when I present the proposed tax rate to

[2:51] you at a future meeting, I will go into

[2:53] more detail

[2:55] regarding property values and how the

[2:57] tax rate is calculated, and we'll get in

[3:01] deeper into that.

[3:02] So,

[3:04] um

[3:05] August 5th, today, and next week on the

[3:07] 12th, budget workshops. And then um

[3:11] the proposed tax rate

[3:13] and the other rates will be on the

[3:15] city's website

[3:17] August 10th.

[3:20] August 14th, we'll schedule pub-

[3:22] hearings on the the budget. Regular call

[3:25] meeting and and on the August 19th is

[3:27] when I will present to you the

[3:29] proposed tax rate for you to vote on.

[3:32] And then we have a couple of required

[3:34] notices of budget public hearing. And

[3:37] then on the 16th of September is when

[3:39] the commission will

[3:41] adopt There will be a budget hearing,

[3:43] adopt the budget, adopt the tax rate,

[3:45] and approve the certified tax roll.

[3:48] So, in tonight's workshop, I'm only

[3:50] going to go over the general fund

[3:53] budget, which is the largest of the

[3:55] funds. It's where most of the

[3:57] departments are, the main maintenance

[4:00] and operations

[4:02] of the city.

[4:03] I'm on the same page.

[4:06] This

[4:07] schedule here is a summary that shows

[4:10] the general fund revenues and

[4:12] expenditures.

[4:14] The amended budget for the current year,

[4:17] what's year-end projection, and then uh

[4:20] proposed budget.

[4:22] As you are probably aware, the two

[4:24] largest components of the general fund

[4:28] revenues is property taxes and sales

[4:30] tax.

[4:33] >> [clears throat]

[4:33] >> And you might want to might wonder,

[4:35] well, why is the amended budget 30.6

[4:38] million on property tax?

[4:40] Projection is 32.5,

[4:43] and then the proposed is 31.1.

[4:46] Well, when when the tax office and the appraisal district provide their

[4:51] information,

[4:52] that's at a certain time a certain date

[4:55] and time. So, in July of this year,

[4:58] they're saying that the appraised values

[5:01] are X amount. Well, throughout the tax

[5:04] year,

[5:05] they submit supplemental

[5:08] valuation reports,

[5:11] which

[5:12] typically those are higher than the what

[5:14] was originally certified. Consequently,

[5:17] the tax levy ends up being higher than

[5:20] what was originally budgeted, what was

[5:22] originally adopted, because of these

[5:25] supplemental

[5:26] valuation increases.

[5:28] So, that's why you're seeing

[5:30] the the 2 million difference between the

[5:32] amended budget and the year-end

[5:34] projection.

[5:35] Now, the proposed budget on the

[5:37] revenues, I have a I have assumed

[5:40] that

[5:42] the no new revenue rate of 0.497231

[5:45] is what will be adopted. So, that's

[5:47] where the 31 is coming in.

[5:51] Um that

[5:53] likely, based on previous history,

[5:56] likely will increase resulting in larger

[5:59] property tax revenues.

[6:01] Um

[6:02] >> [clears throat]

[6:03] >> then uh

[6:04] if you go down to the expenditures for

[6:07] me. Thank you.

[6:09] Here are the various departments that

[6:10] are covered into the general fund.

[6:13] We have general government, which

[6:15] there's uh some staff

[6:18] personnel that are in there, and then

[6:20] the the pay for the mayor and the

[6:22] commissioners are all is also included

[6:24] in that department. Finance is, as you

[6:27] expect, finance. Uh

[6:29] legal, purchasing, planning, which is

[6:32] also includes engineering.

[6:35] And you got uh IT,

[6:37] uh human resources, and communications.

[6:40] Well, the general government department

[6:42] and human resources, communications,

[6:45] and um

[6:47] neighborhood improvement services,

[6:49] and facility management were all

[6:51] departments that were added

[6:53] in last fiscal year.

[6:55] Uh

[6:57] anyway, so um police, fire, neighborhood

[6:59] improvement services used to be a piece

[7:01] of the fire department, and then it was

[7:03] broken out to a separate department.

[7:05] They still

[7:06] report to the fire chain of command.

[7:09] And you've got inspections, municipal

[7:11] court, emergency management, public

[7:12] works, sanitation, pump station, uh the

[7:16] aforementioned facility management,

[7:18] recreation and tourism, library, golf

[7:20] course,

[7:21] um

[7:23] animal control, and uh grants

[7:25] administration are the last of the two

[7:28] of those.

[7:30] Um

[7:31] we can go into the more detail on the on

[7:34] the uh expenditure side of well,

[7:37] scroll up a little bit and we'll stay on

[7:41] previous uh excuse me, on that page. I'm

[7:43] sorry.

[7:44] >> This one?

[7:46] Um here we go.

[7:49] The beginning fund balance for

[7:53] um

[7:53] the the current fiscal year

[7:56] um

[7:58] I'll be honest and tell you I'm not real

[8:01] confident in that number because the

[8:03] 24-25 audit has not been completed. It

[8:06] is in progress

[8:08] but not complete.

[8:10] Um

[8:12] and then consequently the

[8:14] um

[8:15] subsequent fund balances I'm not

[8:19] terribly confident in right now. By the

[8:21] time I bring you the adopted the budget

[8:23] for you to adopt, hopefully we'll have

[8:25] that more um

[8:27] knocked down or in detail. Um the

[8:31] Forvis Mazars accounting firm is

[8:34] currently doing the 24-25 audit

[8:37] and they expect to be done with their

[8:38] field work, which is their

[8:40] uh in-depth testing of accounts payable,

[8:43] accounts receivable, all the things that

[8:45] go into the financials.

[8:47] They expect to be done with that

[8:49] September 18th. So once they're done

[8:51] with that, then they will prepare the

[8:53] report.

[8:54] Um

[8:55] so hopefully we have

[8:58] better numbers closer we get to

[9:00] September 16th when you all adopt the

[9:02] budget.

[9:04] You can go to the next.

[9:07] So this is a more detailed view of the

[9:10] revenues

[9:11] um

[9:12] taxes also includes delinquent taxes,

[9:15] penalties, and interest. Other taxes and

[9:18] assessments, the the big ones

[9:20] uh state sales tax

[9:22] um and then our tax New Mexico power

[9:24] franchise tax is also a big component

[9:27] there.

[9:28] Um

[9:30] then the next grouping is all the

[9:32] various licenses and permits.

[9:34] Um and then we have grant revenue, uh

[9:37] charges for services,

[9:39] which is the big one there is uh

[9:42] um

[9:43] garbage pick up and disposal,

[9:45] uh EMS patient charges,

[9:47] um that sorts of things.

[9:49] >> [clears throat]

[9:53] » And then the the other various

[9:56] um

[9:56] revenue line items.

[10:00] So, what what I'm expecting uh

[10:03] budget-wise for total revenues is 81.8

[10:06] million.

[10:07] And typically we're we're quite

[10:09] conservative when we budget for

[10:11] revenues.

[10:12] Um that's why we don't often bring back

[10:16] before commission to revise the revenue

[10:19] items.

[10:20] Like what I was talking about before,

[10:22] when we get supplemental reports or

[10:24] evaluations from the CAD, we don't

[10:26] usually bring it back before commission

[10:27] to say

[10:29] um

[10:30] we're revising the revenue

[10:32] budget.

[10:34] Any questions so far on the revenues?

[10:37] >> Yes, ma'am.

[10:39] So, Ms. Boyd, it looks like just to

[10:42] start off, if we're planning

[10:46] 84 million in spend on 81 million in

[10:49] revenues,

[10:51] 81.8, 82, there's roughly a 2 million

[10:54] deficit

[10:55] >> Mhm.

[10:56] >> there.

[10:57] >> Mhm.

[10:57] >> So, then would that come from general

[10:59] fund or some reserve fund to cover that

[11:02] or we're hoping for the revenues to come

[11:04] >> Well, look, it it would be coming from

[11:06] the fund balance.

[11:09] Um

[11:11] historically, like I said, we budget um

[11:15] conservatively on the revenue side and

[11:17] try to be as tight as possible on the

[11:19] expenditure side.

[11:20] Um

[11:24] I don't like having the 2.3 deficit,

[11:27] obviously.

[11:28] The city charter requires that the

[11:30] revenues or the expenditures not exceed

[11:34] revenues for the entire budget, not just

[11:36] one fund.

[11:38] So.

[11:39] Um

[11:42] Like you know, this is the first

[11:45] look at this and um

[11:48] I'm hoping to bring back a a better total.

[11:53] >> Understood. Yeah, it's my perception

[11:55] that we're behind on certain areas and

[11:58] we may may need to catch up on

[12:00] investment and I'm I'm assuming we'll

[12:02] get further into that here in a moment.

[12:04] But I I do want to draw out for the

[12:06] other commissioners that I've been

[12:08] beating the drum about the need for more

[12:12] development, residential developments,

[12:14] commercial development, but

[12:16] expanding development in our city will

[12:18] help, not immediately, but over some

[12:20] amount of time, drive more property tax

[12:23] and sales tax revenues. Is that a fair

[12:25] summary?

[12:26] >> I think that's fair.

[12:28] >> Yeah.

[12:30] Thank you.

[12:31] >> [clears throat]

[12:33] >> You can go to expense right next

[12:34] expenditure.

[12:36] Here's the general government I can't

[12:39] department.

[12:41] Um

[12:44] as we go through these different

[12:45] departments, if if you'd like to ask

[12:47] questions, I'm I'll entertain those.

[12:50] I will tell you

[12:52] um

[12:53] for all the general fund departments

[12:56] um even those that had requested um

[13:00] personnel increases

[13:03] the numbers that I'm providing to you

[13:04] here assume a 3% cost of living

[13:08] uh a

[13:10] adjustment and uh does not include

[13:13] funding for any

[13:15] new positions.

[13:19] » [clears throat]

[13:20] >> So, I just wanted to make that note.

[13:23] So, on the general fund uh Uh me,

[13:25] general government department,

[13:27] >> [clears throat]

[13:27] >> they currently have uh

[13:30] seven employees.

[13:34] And they did not request any additional.

[13:40] You want to scroll down to the finance?

[13:44] >> Finance?

[13:45] next, there we go.

[13:47] The uh finance department currently has

[13:50] nine personnel and no

[13:54] request for additional.

[14:02] And the total the

[14:04] Yeah, go to the total. Yeah.

[14:06] Six Sorry. Go back up there.

[14:09] Almost 6 million budgeted there.

[14:13] Um in the finance department, it

[14:17] not just uh the usual

[14:20] uh expenditures.

[14:23] The TIRZ tax payments come out of the finance department and any sales tax

[14:28] rebates

[14:29] um come out of here with a

[14:32] 50/50 split between the the finance

[14:34] department and the EDC.

[14:40] And go to the

[14:41] next.

[14:41] >> B- Before you move forward, I'm I'm

[14:44] trying to find that in my own copy. I

[14:45] had written some notes on it, but

[14:49] the if I'm reading this correctly, Ms.

[14:51] Boyd, there's a jump from 4.2 to almost

[14:54] 6. What are some of the

[14:57] chunky

[14:59] parts of that increase?

[15:02] >> Well, the biggest one looks like to be

[15:03] it's the contractual services.

[15:06] You want to go to the

[15:08] Yeah.

[15:13] » The the 1.5 on the insurance.

[15:16] >> Right. Well, if you notice the

[15:18] current budget has nothing there.

[15:22] I'm not sure where the insurance That's

[15:25] something we're trying to

[15:27] >> Where was insurance for this fiscal

[15:29] period?

[15:29] >> it was I mean it was paid. I just don't

[15:31] know exactly where it was paid from.

[15:34] Normally it would be would have been

[15:35] paid out of where I have it budgeted

[15:37] for.

[15:38] >> Maybe it's in one of those sub-accounts.

[15:41] >> I'll let you

[15:43] I'll let I'll I will answer that when I

[15:45] find out where it is. But

[15:48] rest assured the insurance has been

[15:49] paid. It's just not been paid out of

[15:51] where it usually had been paid from.

[15:55] » So that's 1.5 difference, 1.5 million

[15:58] difference out of the 1.8 commissioner.

[16:00] >> I mean that's Yeah.

[16:01] >> Very good.

[16:02] >> It's a pretty big chunk pretty big chunk

[16:03] right there.

[16:04] >> Yeah.

[16:05] >> Yes.

[16:05] >> I had very diligent notes and then my

[16:08] computer crashed and I lost most of them

[16:10] so I'm struggling to catch up. But

[16:12] please continue Ms. Boyd.

[16:14] >> You want to go to the legal department?

[16:18] Uh currently there is one person in the

[16:21] legal department that's paid

[16:24] salary and benefits from the city.

[16:26] And then um

[16:29] we contract for legal fees.

[16:33] That shows up in the professional fees

[16:35] line item. And then the court prosecutor

[16:38] fees

[16:39] um

[16:40] previously [clears throat] they were

[16:41] recorded out of um municipal court but

[16:44] it's more appropriate that it come from

[16:46] the legal department. So that's why it's

[16:48] in here instead of municipal court.

[16:52] >> So to the extent that we incur expense

[16:55] incremental expense to handle litigation

[16:59] and I'm assuming then we would use

[17:00] outside legal services to defend

[17:03] ourselves against any suits, is that in

[17:06] that professional fees line item?

[17:09] >> Uh yes. And also most of the departments

[17:12] have a professional fees line item.

[17:14] Sometimes it it's

[17:16] for example if it's a police matter,

[17:19] then it would come from the police

[17:20] professional fees.

[17:22] It would be department specific.

[17:24] >> Yeah, that's specifically what I was

[17:25] looking for. That is my perception is we

[17:28] have ongoing litigation. I don't I don't

[17:30] know that.

[17:31] But where is that being paid for? And so

[17:33] maybe it's

[17:34] >> It would be dependent on the department

[17:35] that's involved.

[17:37] >> Noted. Thank you. [clears throat]

[17:40] >> We'll go to

[17:41] purchasing.

[17:44] there's currently one

[17:45] person.

[17:47] Um

[17:48] just a couple of days ago there were two

[17:50] people.

[17:51] Um so there's transition going on in in

[17:53] that uh department. Um

[17:57] basically staying flat with what the

[18:00] projection versus the budget.

[18:04] You go to the next.

[18:05] >> Does

[18:05] this reflect one or two people?

[18:08] >> The proposed budget right now is

[18:10] reflecting one person.

[18:14] » So

[18:15] we're not intending to backfill then?

[18:18] >> That hasn't been decided yet.

[18:21] The planning department is also

[18:23] engineering.

[18:25] Um

[18:26] and uh there are three people in that

[18:29] department currently.

[18:32] Um

[18:34] the biggest ticket on this uh

[18:36] department, well, the two items,

[18:38] professional fees and Connect

[18:40] Transportation.

[18:41] Connect Trans- Transportation is the

[18:43] city's uh contractual obligation to

[18:46] Connect Transit.

[18:48] And then the professional fees, there

[18:49] are numerous um

[18:52] entities that are doing work

[18:56] engineering and planning wise, and that

[18:57] comes out of that line item.

[19:00] >> A couple of things um before we put away

[19:02] purchasing. So, um

[19:05] it was my perception that under the

[19:07] previous administration there had been

[19:08] some amount of effort to centralize

[19:10] procurement in some way. I may be

[19:13] misstating that.

[19:14] But that previously on the decades

[19:18] prior, certain departments that procure

[19:21] a lot of things had their own

[19:22] procurement-related

[19:24] capability.

[19:25] >> [clears throat]

[19:26] >> So, if we're currently considering do we

[19:29] backfill or do we not backfill, does

[19:30] that have some impact then on this other

[19:32] capacity or am I just wrong about my

[19:34] notions on all that?

[19:35] >> Um

[19:37] All I'm going to tell you is how it

[19:39] like you said, decades previously, there

[19:41] was

[19:42] one purchasing person for

[19:46] all departments except for public works.

[19:49] had one dedicated person

[19:52] um that reported to public works

[19:55] director that was doing purchasing for

[19:58] public works utilities.

[20:01] Um

[20:02] It has not been decided yet as to if

[20:04] that's going to revert back to that or

[20:07] if some other

[20:09] variation.

[20:11] >> It would seem to make a lot of sense.

[20:13] The things that Jack's department

[20:15] procures have a high degree of technical

[20:17] specificity and complexity and so to try

[20:20] to centralize that in some way would

[20:22] seem

[20:23] like why? Why do that?

[20:25] >> Well, another uh component of

[20:27] centralized purchasing um

[20:31] you have to have a place to warehouse

[20:33] things.

[20:34] And

[20:35] anyway,

[20:36] that's another component of it. So,

[20:39] um

[20:40] >> Thank you.

[20:40] >> Commissioner, it hasn't been decided yet

[20:42] as to how that's going to be handled.

[20:45] Um

[20:46] I will present what public works has

[20:48] requested and then it'll be

[20:51] uh

[20:52] commission to determine how they want to

[20:53] proceed with it.

[20:54] >> Okay, thank you. Uh moving ahead to

[20:56] planning then.

[20:57] So, the um this has been a topic um that

[21:00] I've discussed with a number of people

[21:03] um in one-to-one discussions that given

[21:07] the sheer volume of

[21:10] potential, I'm optimistic about it. I

[21:12] think hopefully for the assembled public

[21:14] and other commissioners, we've connected

[21:16] the dots between we need things like

[21:18] Latitude Margaritaville to help

[21:21] improve our revenue situation.

[21:24] But whether people agree with me on that

[21:26] or not,

[21:27] there

[21:28] will be a lot of engineering associated

[21:31] with that and engineering of different

[21:33] types. I'm no engineer here, but I think

[21:36] there's probably 15 or 20 different

[21:38] types of engineering specificities that

[21:40] are needed for that. And so a discussion

[21:45] that's

[21:46] I've been a part of a few of. Sorry,

[21:48] speaking

[21:50] extemporaneously.

[21:51] I've been in a few discussions about

[21:53] best practices that we might see in

[21:55] other cities around us, which would

[21:56] involve utilizing a third-party

[21:59] engineering firm

[22:01] where it makes sense for them to have

[22:03] all those different

[22:04] specialties. Where we need those on an

[22:07] ad hoc basis, we utilize this

[22:09] third-party engineering firm. And as I

[22:12] also understand it, those third-party

[22:14] engineering firms are largely paid for

[22:16] by fees that are incurred through the

[22:17] permits.

[22:19] Most recently this week what I had heard

[22:21] was, "Yeah, but Jason, we can't do that

[22:23] because it's too expensive."

[22:26] Now whether this is all hearsay and

[22:28] innuendo or not, as I look at the

[22:30] planning expenditures then, and I think

[22:32] that we have an interim city engineer,

[22:35] as I look at these line items, is that

[22:36] assume that we're backfilling should Mr.

[22:39] Knipper move on to whatever's next? Or

[22:41] what what assumptions should we make

[22:42] about personnel in the planning

[22:44] department?

[22:48] There was a lot there, huh?

[22:50] >> [laughter]

[22:52] >> Well, I have a question.

[22:53] >> It's kind of a sensitive point though,

[22:54] because there's a a backlog of

[22:57] >> Well, Commissioner, the the

[22:59] ongoing projects

[23:02] within the city does use

[23:06] third-party engineers.

[23:08] Um and then depending on the project

[23:11] um

[23:13] other engineers could be brought in. I

[23:15] mean that that's standard operating

[23:18] procedure.

[23:19] Regardless if there is an interim city

[23:21] engineer or a full-time city engineer,

[23:23] there's

[23:25] other engineers that are involved

[23:26] depending on the project.

[23:28] >> Understood. What I understand

[23:30] >> is at the the Are there

[23:32] on behalf of the city?

[23:34] >> Yes, ma'am.

[23:35] Um sorry. Pardon me. I I never want to

[23:38] offend or speak over you. The But where

[23:40] I'm going with this is if you're a

[23:42] developer and let's say that you're

[23:43] trying to build 3,500 homes in our city

[23:46] and then you're pre-selling out in

[23:47] advance

[23:49] and you make commitments to

[23:52] Mr. and Mrs. Boyd that their home is

[23:53] going to be ready on date certain.

[23:56] Then whenever they need an inspection,

[23:58] they really need it done within a really

[24:00] narrow time frame. And now if I have 500

[24:02] of those homes being constructed all in

[24:04] tandem, that would easily exceed our

[24:06] capacity to respond with the horsepower,

[24:10] the manpower that we have.

[24:12] So so

[24:13] I can table this for discussion with the

[24:15] mayor and others at a later time, but I

[24:16] just wanted to

[24:18] if if indeed this Margaritaville

[24:20] development happens and I'm hopeful it

[24:22] does,

[24:23] that could put a significant strain on

[24:25] our ability to respond timely with all

[24:28] sorts of inspections.

[24:31] >> Ms. Boyd, do you mind if I

[24:32] >> Sure.

[24:33] >> Uh Commissioner Delgado, I think um

[24:35] you're specifically referring to the

[24:36] Margaritaville, you know, the influx of

[24:38] homes and if we can keep up with the

[24:40] demand of them building. Is that what

[24:41] you're speaking to?

[24:42] >> I exactly that.

[24:43] >> Um through the workshops that we've had

[24:46] with Margaritaville, um I believe and

[24:49] anybody else involved can correct me if

[24:50] I'm wrong.

[24:51] I believe they're going to be putting

[24:53] 100% of that bill.

[24:56] I think they said 110% of it

[24:59] that they're going to be covering, so

[25:02] >> And

[25:03] even though there's going to be a lot of

[25:05] homes that they're doing it in more than

[25:06] one phase, the first phase is probably

[25:08] maybe 400 acres and they're only going

[25:11] to build 50 homes a month. And in

[25:13] discussing this with

[25:15] Dirk Knipper, they'll be able to keep up

[25:17] with 50 homes a month.

[25:19] >> So be it. Just what I'm making sure is

[25:21] that we're not planning to do a lot of

[25:23] hiring when we could utilize

[25:26] third parties as a best practice and

[25:28] particularly when we don't have to pay

[25:29] those third parties up front, that their

[25:31] cost is covered by the fees that are

[25:33] incurred.

[25:34] >> If that comes to point, I'm sure that

[25:36] third party will come into play.

[25:38] >> Fantastic. Thank you.

[25:39] >> Um

[25:40] when we use a third party

[25:42] engineering company, they don't always

[25:46] control your staff

[25:48] like what we have.

[25:50] With Dirk Knipper, he's over engineering

[25:51] with our staff.

[25:53] >> Now, the third party engineers

[25:55] >> That's our problem.

[25:55] >> controlling our staff.

[25:56] >> the head of our engineering with a third

[25:58] party. We have to do both.

[26:01] >> Right.

[26:01] >> All right, let's go find one that will

[26:02] do that stuff.

[26:04] >> Yeah, the search is still ongoing.

[26:06] We did interview third party engineering

[26:09] group and they did not want to manage

[26:11] the staff, evaluate the staff, assign

[26:13] assignments, so

[26:16] that company didn't work out.

[26:17] >> Yeah, that's what I'm saying. That's

[26:18] kind of the problem, right?

[26:19] >> Yes.

[26:23] » You want to go to

[26:24] IT?

[26:30] Here we got IT and they've got four

[26:31] personnel and they've requested

[26:34] one administrative assistant.

[26:37] Um

[26:39] the big ticket item for

[26:41] Slow down.

[26:43] Um

[26:46] one of the big ticket items is

[26:47] communications and a couple of years ago

[26:51] or maybe this current fiscal year. Now

[26:53] it was it was 24 25 from what I recall.

[26:57] The communications

[26:59] budget was

[27:00] put all in innovation and technology.

[27:03] Previously um

[27:06] >> [clears throat]

[27:06] >> each department, if applicable, would

[27:08] have a communications line item, but

[27:10] then it was all moved into uh IT.

[27:14] Um IT also takes care of the um

[27:18] maintenance contracts or renewals and

[27:21] licenses for various software that is

[27:24] used across city departments. Now if

[27:27] it's a specific software that's used by

[27:29] one department, that department will be

[27:31] responsible for paying for that

[27:33] software.

[27:34] But um

[27:35] if it's a citywide uh

[27:38] system, then IT pays for that in their

[27:41] budget.

[27:43] >> It Is that feasible to have four people

[27:45] do

[27:47] >> I

[27:47] >> Um it's uh

[27:50] They're very busy and and you know,

[27:52] they've requested

[27:54] an admin assistant

[27:55] um to handle some of the paperwork and and that sort of

[28:00] thing. That way they can be out the the

[28:02] other four can be out in the field

[28:05] handling um

[28:07] whatever needs to be handled at various

[28:09] other departments.

[28:10] >> Thank you.

[28:11] I I'll defer to to Joe on this, but I I

[28:14] met with himself and Kyle on this that

[28:17] um I'm I'm a big fan of investing in IT

[28:20] because it can enable more automation

[28:23] and more throughput and more efficiency

[28:25] and more services. So I I was

[28:28] personally expecting to see a

[28:29] significant

[28:31] a bigger increase right here, but I but

[28:33] I'll defer to Joe thinks this is right

[28:35] then then so be it.

[28:38] >> Well, obviously we'd like to have

[28:40] three or four more.

[28:42] >> [laughter]

[28:44] » I think my private coaching was this is

[28:46] an area of the staff I would suggest

[28:48] doubling it.

[28:50] Yeah, but if if one is is the

[28:51] incremental step

[28:53] supported by the mayor then then so be

[28:54] it.

[28:56] >> Of course the other side of that coin is

[28:57] if you have good systems that work well

[29:02] you might not necessarily need

[29:05] >> Right.

[29:05] I don't think we have that though, do

[29:07] we?

[29:08] >> [laughter]

[29:11] » It's

[29:12] well never mind. Um

[29:15] we can go to the uh human resources.

[29:17] >> One question, what's the

[29:19] what's contractual services and

[29:20] communications? What what's the

[29:22] difference between

[29:24] >> Can you go back to that page, please?

[29:27] >> Is is [clears throat] that

[29:30] » Contractual ser-

[29:32] services is the total of all of those um

[29:35] security through workers comp.

[29:39] >> Okay, thank you.

[29:43] » Now we're going to go to um

[29:44] human resources.

[29:49] Like I said, this department was created

[29:51] in

[29:51] um

[29:53] in 24/25.

[29:55] It was previously part of

[29:57] the overall administration department

[29:59] which had um

[30:01] city secretary, human resources, finance

[30:05] um

[30:06] all combined and then it it got split

[30:08] out. Anyway, there's uh four folks that

[30:11] work in human resources right now.

[30:13] Um

[30:15] and uh they have all the the usual

[30:17] expenditures for a department.

[30:20] Um

[30:25] » The number is decreasing.

[30:29] Are we are we are we

[30:32] going down an FTE there and is that what

[30:35] we're going to do?

[30:35] >> Until recently it was five people. Now

[30:37] it's

[30:37] >> that's what I was thinking it was five.

[30:39] >> Yes.

[30:41] Now there's only four. Um

[30:44] >> And we're we're planning to stay that

[30:45] way.

[30:47] >> That hasn't been decided yet.

[30:52] And next department is communications.

[30:57] This is also newly formed department. Uh

[31:01] This is uh media relations uh

[31:10] Jennifer and Derek and

[31:12] uh one other staff person.

[31:14] Um they have requested an another

[31:17] communications specialist.

[31:20] Um I will tell you

[31:21] this is not their only budget. They have

[31:25] uh line items that pertain to them in

[31:28] EDC, uh the dike fund, and uh hotel

[31:32] motel occupancy tax fund.

[31:34] Those are funds that'll be covered in

[31:36] the next budget workshop. This is

[31:38] strictly

[31:39] what is covered for their department out

[31:41] of the general fund.

[31:46] Any questions on that?

[31:48] >> It's the EDC

[31:50] the what are the other funds?

[31:52] >> Hotel motel occupancy,

[31:55] uh dike fund

[31:57] >> Uh thank you.

[31:58] >> cultural arts

[31:59] >> Yeah.

[32:00] >> Sue, are we are we adding head count in

[32:03] this area from this year to next cuz it

[32:05] looks like there's a

[32:07] like a 60% increase?

[32:10] >> Can you go back up to the salaries line

[32:12] up?

[32:13] >> [clears throat]

[32:13] >> Um

[32:16] I'm not sure where the current

[32:18] salary line the current amended budget

[32:22] that number is.

[32:24] >> Was it in a queue? Now it's three.

[32:26] >> Yeah.

[32:27] >> That's why it's changed because of

[32:28] Camilla.

[32:30] It was two and then Harvey period one

[32:31] spot. Now we're looking for a fourth

[32:33] one. That's

[32:35] » And I don't know when the third

[32:37] person was hired.

[32:38] >> That's me.

[32:41] Okay.

[32:41] >> Yes, so she won't be on

[32:43] >> Anyway, that would account for the

[32:46] biggest difference

[32:47] and all the benefits

[32:49] attached there to.

[32:53] And next department, police.

[32:59] Not surprisingly, police has a large budget. Um

[33:05] the um

[33:06] the head count

[33:09] not counting open positions. This is

[33:11] what's currently filled is a total of

[33:13] 110.

[33:15] 84 officers and 26 civilians.

[33:19] Um that salary line item is only

[33:22] accounting for

[33:24] the currently filled positions

[33:26] with a 3% increase.

[33:34] » [clears throat]

[33:36] >> Is it unusual to pay the

[33:38] 700,000

[33:39] a year in overtime or

[33:41] I mean

[33:43] >> Well, because of the

[33:45] short staffed, then

[33:47] um

[33:50] I mean, the 527 year-end projection

[33:53] not a pro- All the year-end projections

[33:55] I need to preface this with it saying

[33:57] that all the year-end projections will

[33:58] change before you adopt the budget. This

[34:01] is as of

[34:04] a couple of days ago

[34:05] extrapolated out two more months.

[34:08] Um

[34:10] So, the overtime

[34:12] may not be 700,000 for the upcoming

[34:15] year, but

[34:16] >> Okay.

[34:16] >> Um we budgeted for it.

[34:18] >> It's a projection. Yeah, um Commissioner

[34:20] Getches says the

[34:22] just building on top of what he said.

[34:24] Looking at that consistently across a

[34:26] 3-year spread, it suggests we're

[34:28] understaffed. And if we're meeting the

[34:30] need through overtime,

[34:32] then it seems like we need to add head

[34:34] count.

[34:35] Is that Is that a fair summary, Mayor

[34:37] Carson?

[34:38] >> Yes, exactly.

[34:39] >> So,

[34:40] and Interim Chief Patterson can answer

[34:42] those questions.

[34:44] >> Yeah, and my understanding is long

[34:46] before ever I

[34:47] was elected, that's been an ongoing

[34:49] thread. What I also understand from

[34:51] talking with

[34:52] a lot of folks in the know is we've been

[34:54] eligible for certain grants

[34:57] to expand head count and that for

[35:00] different reasons that hasn't worked

[35:02] out. Is that Is that a fair

[35:05] >> Well, on the the couple of the grants

[35:06] that I'm familiar with, um, had

[35:09] requirements for hiring.

[35:11] And if you didn't hire

[35:14] Correct me if I'm wrong, James. If you

[35:16] didn't hire

[35:17] by a certain time, then you weren't

[35:19] going to get the money.

[35:22] >> Yeah, so the the grants that the grants

[35:23] I'm talking about were from the prior

[35:25] administration. So, my scope now on

[35:27] those would be somewhat

[35:29] small.

[35:32] But there is hiring difficulties with

[35:35] the the police department. Not

[35:36] specifically to the department, but the

[35:38] candidates that are that are

[35:40] applying.

[35:42] >> Yeah, as I've as I've, um, tried to come

[35:44] up to speed on a number of these things,

[35:46] one of the things that I I do is I look

[35:48] to cities that are similar to us.

[35:51] Large industrial base.

[35:53] Growing similarly. And so that leads to

[35:57] LaPorte, Deer Park, Port Arthur, others

[36:00] that are more like us.

[36:02] And consistently when you look at a

[36:06] patrol officers to

[36:08] citizens, like a per capita measure, it

[36:10] says we are grossly understaffed. Is

[36:13] that Is that I'm just off on the new

[36:15] guy, or would you agree?

[36:16] >> I would not argue against that fact. No,

[36:18] not at all.

[36:19] >> Yeah. And so then when you're grossly

[36:21] understaffed, then the way that you try

[36:23] to address need is through lots and lots

[36:27] of overtime.

[36:29] Which then leads to other challenges. Is

[36:32] that also a fair summary?

[36:35] Morale, people are worked to the bone.

[36:38] >> That would be fair to say.

[36:41] » Okay. It seems like maybe that's

[36:43] something that needs some more offline

[36:45] discussion of what can we do to try to

[36:47] remedy that?

[36:49] Hey.

[36:50] Is there an elephant in the room?

[36:52] >> No.

[36:52] >> [laughter]

[36:54] >> They got the process started

[36:56] a few months back.

[36:58] >> And the And the termination pay is when

[37:00] the officers retire

[37:01] >> Yes.

[37:02] >> or resign.

[37:03] >> Yes.

[37:04] >> And then I guess it's the

[37:06] for the chief were

[37:08] clothing we got 140,625.

[37:12] Is that because we have so many

[37:13] different uniforms or is that just what

[37:16] it takes? We

[37:18] I don't see any two officers wearing the

[37:20] same

[37:21] uniform.

[37:23] There's different polos and

[37:25] >> Yeah, so there there are uniform

[37:27] options. There's a lot that goes into

[37:30] It's not just clothing and uniforms.

[37:31] There are

[37:33] uh equipment items that are purchased

[37:35] out of that line as well such as

[37:37] radio batteries,

[37:40] duty rigs,

[37:43] uh handcuffs,

[37:44] handcuff pouches, holsters.

[37:46] Uh those types of things are also

[37:48] purchased out of that line.

[37:51] >> I

[37:53] » You can use the police officer

[37:55] You can use the microphone.

[37:59] » Yeah, I think we have more questions.

[38:01] This is an area of high interest.

[38:03] >> Four year

[38:06] You want to use that?

[38:07] >> Get comfy.

[38:08] >> Can I get to sit down and dig into it?

[38:14] » All right.

[38:15] I got one to the the food and jail

[38:17] supplies.

[38:19] And I don't know, but do we house other

[38:21] agencies inmates?

[38:24] >> So, yes, we currently have a

[38:27] MOU with Clear Lake Shores and we do

[38:30] house their municipal Class C inmates.

[38:32] Yes.

[38:34] >> That's it? Just Clear Lake Shores?

[38:36] >> Correct. Currently in the process of

[38:38] working with

[38:39] The prior administration agreed to have

[38:43] the same type of MOU with Hitchcock and

[38:45] that has not started as far as I'm

[38:48] aware. There were some They're waiting

[38:50] We're still waiting on their municipal

[38:51] paperwork and their judge information.

[38:53] >> What would be the benefit for the city?

[38:56] >> Commissioner Sharpley, can't hear you.

[38:58] >> What would be the benefit

[38:59] to that?

[39:00] >> It does It does provide a source of

[39:04] revenue for

[39:07] the city.

[39:08] Currently, they pay $50 per calendar day

[39:12] that a subject is there. I would say

[39:14] that it doesn't cost us $50 to feed and

[39:18] or house that that inmate. So, it it is

[39:20] a revenue source, plus it's a good faith

[39:23] gesture to surrounding law enforcement

[39:25] agencies.

[39:26] >> But, we're liable to them, too, right?

[39:28] When they're in our jail?

[39:28] >> That That would be accurate. Yes.

[39:30] >> All right. One other one. I don't

[39:32] remember what it's called. There's a

[39:32] grant, correct me if I'm wrong,

[39:35] and we used to have it.

[39:37] Pull people [snorts] over. I'm sorry.

[39:39] That's my bad. Pull people over

[39:41] and they supply it. You know You have

[39:42] any idea what I'm talking about?

[39:43] >> Yeah, the selective traffic enforcement

[39:45] program, STEP grant. Yes, sir.

[39:47] >> You think that's something we could try

[39:48] to do again or are we looking

[39:49] >> We currently still have it. And

[39:51] actually, last year our STEP grant was

[39:54] almost doubled. So, we went from I

[39:56] think Well, not quite doubled.

[39:59] Our That current grant is a $49,000

[40:02] grant, but it's a match grant. So, the

[40:04] city matches half of that grant with the

[40:06] state.

[40:07] >> So, we never stopped doing that?

[40:09] >> No, it's still ongoing.

[40:10] >> I apologize. I'm sorry. This is

[40:12] important.

[40:13] >> So, now, does any of the inmates from other agencies

[40:18] Do we have our judge?

[40:20] >> No.

[40:21] >> He has no participation at all with

[40:23] that.

[40:23] >> Correct. So, the agreement with Clear

[40:25] Lake Shores is they provide they have a

[40:27] safe that is in the jail where all of

[40:29] their money

[40:31] goes. They have a judge that responds to

[40:34] our facility to magistrate and or make

[40:38] determinations as far as their inmates.

[40:40] Uh their police officers obviously

[40:42] transport here. Uh we don't transport

[40:45] for them. So, they basically rent our

[40:48] jail facility from us, but they're a

[40:51] self-contained unit outside of that. At

[40:53] the end of each month, we run a report

[40:55] that shows how many inmates they had in

[40:58] the jail.

[40:59] Uh we provide that to finance and they

[41:02] invoice Clear Lake Shores who then

[41:05] uh submits payment to the city.

[41:07] >> And one one last question. If if we have

[41:09] an a suicide or

[41:12] a major incident in the jail, it's on

[41:14] our city or their legal team picks up

[41:17] their inmate?

[41:19] >> That's a great question. We have not

[41:22] dealt with that type of situation at the

[41:23] moment. Like I said, we're we are

[41:26] housing their Class C arrests. So, any

[41:28] Class B and above or serious offenses

[41:31] would go straight to Galveston County.

[41:33] Uh that's something that we have not

[41:36] dealt with.

[41:37] Um so, I I don't have

[41:38] >> look into that for me with the with our

[41:40] legal people?

[41:41] >> Mhm.

[41:42] >> I don't

[41:42] >> But we are liable.

[41:44] We do accept the liability when they're

[41:46] in our jail, right?

[41:46] >> Like sitting here right now, I would say

[41:48] yes. I I do believe. I'd have to revisit

[41:51] the contract, but yes.

[41:52] >> Yeah, they hung themselves, it'd

[41:53] probably fall under the same thing, I

[41:54] would think.

[41:55] >> Yeah.

[41:56] one would assume

[41:57] >> died in the happen?

[41:57] >> If someone dies in our custody, we're liable. Um

[42:02] back to the topic of legal. So, if we

[42:06] are being if we are the party to

[42:08] litigation, we're being sued for

[42:10] whatever the cause is, there a line item in here?

[42:14] >> Um yes, we do have a professional fees

[42:16] line item built into our budget.

[42:20] >> It's kind of small, huh? 80k to 96k? Or

[42:23] am I looking at the wrong line item?

[42:24] >> Uh fortunately, that is

[42:27] a line item that we are we've operated

[42:31] and we're currently

[42:33] in route to operate under that projected

[42:35] amount.

[42:36] I think if if we are administrating and

[42:40] doing our job efficiently, I I don't

[42:42] think that's a line item that we would

[42:43] expect to to

[42:44] supersede.

[42:46] >> Completely agree.

[42:47] >> Yeah.

[42:47] >> Completely I'm definitely for less

[42:49] police-related litigation and not more.

[42:51] Just we're this is a topic that we've

[42:54] when we were elected, we had a lot of

[42:56] things that were

[42:57] we were trying to address, but public

[42:59] safety was like the top three, and a lot

[43:02] of front porch, front lawn conversations

[43:04] about this matter. And so, the

[43:06] perception was is there's more

[43:08] litigation than is showing up right

[43:09] here, but but candidly, we don't know.

[43:11] Like this is a topic I think I spoke to

[43:13] you in the hallway. Like we we've been

[43:15] asking for information about this.

[43:17] I'll move on. Um the the line item there

[43:20] on equipment rental from 46k to 524,000,

[43:23] that's about a $480,000

[43:26] increase. What are we What are we

[43:27] renting?

[43:28] >> So, the equipment the equipment rental

[43:30] line and that and that number may be

[43:33] offset a little bit based on

[43:35] prior budget movement. Um we mentioned

[43:38] the communications line was previously

[43:40] moved. Our communications line

[43:42] >> puts and takes from A to B.

[43:43] >> Yes, uh under prior administration. So,

[43:45] equipment rental is a line that we use.

[43:47] We have several contracts with, for

[43:49] instance, our body cameras are a

[43:52] contract item, our in-car cameras are a

[43:55] contract item. So, with Axon, the the

[43:59] actual business is Axon, um

[44:02] that's where we pull those funds from,

[44:04] having those contractual obligations.

[44:07] The other thing that may be included in

[44:08] that line

[44:10] would be flood cameras.

[44:12] Would come from an equipment rental

[44:14] line, so.

[44:15] >> Commissioners, just for the sake of

[44:16] time, we have about 11 minutes left. I

[44:18] don't know how far y'all want to get,

[44:20] how far how detailed you want to get,

[44:21] but we have Commissioner

[44:23] >> I think we're only about 40% through it,

[44:25] Mayor Garza. So So maybe we need to have

[44:27] a part two that allows more time.

[44:29] Yeah, I I think I had expressed to Joe, maybe I need my own meeting and we

[44:33] can just set aside a day. I got a lot of

[44:35] questions.

[44:36] Yeah.

[44:37] >> I think everyone makes themselves

[44:38] available to ask some questions, so Miss Boyce sent this morning if we have

[44:41] any questions, she's available to take

[44:43] those questions.

[44:45] >> Well, and then the meeting on the 12th

[44:46] is at 5:00 and we'll cover

[44:49] the other funds and then revisit

[44:51] anything that was not answered or asked

[44:55] at this meeting.

[44:57] Can be taken care of

[44:59] next week's meeting.

[45:01] >> Okay, cuz we do have one comment from

[45:04] a citizen.

[45:06] >> So did you

[45:06] >> Can you get as far as you can maybe with

[45:09] >> Yeah.

[45:09] >> 5 minutes left or something?

[45:11] >> Uh fire department is next.

[45:17] Uh

[45:18] >> [clears throat]

[45:18] >> in this one there are

[45:20] um 98 civil service

[45:22] plus civilians, which is 95 firefighters

[45:25] and three civilians.

[45:27] Um

[45:28] they requested one training officer, one

[45:30] assistant EMS director,

[45:32] and of course all the personnel for

[45:34] station five,

[45:36] which um I've not included in this.

[45:39] Um

[45:40] a big chunk of those um expenses won't

[45:44] come until later on in '27.

[45:47] Anyway, it it'll be brought back before

[45:48] commission to um

[45:51] fund that.

[45:52] Um

[45:55] So if you want to go to neighborhood

[45:57] improvement services.

[45:59] >> Mayor, I I propose that if it's given

[46:01] we've got another meeting to start

[46:02] minutes that we need to park on this and

[46:04] I just for the record I've got a lot

[46:06] more on just police and I just want to

[46:09] address a comment made by Commissioner

[46:10] Knox and

[46:11] certainly I'm a big fan of Miss Boyd and

[46:13] I can send her my questions but the

[46:15] whole idea of this is let's have it out

[46:17] in the public.

[46:18] It needs to be out in the public so I

[46:20] think maybe we want to have another

[46:22] meeting that includes the public.

[46:23] >> And what Miss Boyd said was that we do

[46:25] have to have have the second part next

[46:27] week and then we can go back to this

[46:28] part that we didn't finish cuz we do not

[46:30] have a commission meeting next week.

[46:32] >> That'd be great.

[46:32] >> Thank you.

[46:34] >> Um

[46:37] Neighborhood I'll just do this real

[46:38] quick. Neighborhood Improvement Services

[46:41] also known as code enforcement

[46:44] um is its own separate department um but

[46:47] they report to uh the fire department.

[46:52] And there are three of those employees.

[46:57] Moving on to Inspections.

[47:02] Department has currently has

[47:04] 10 employees to handle all that's going

[47:08] on in Texas City.

[47:10] Um

[47:12] They don't have a whole a too big a

[47:14] change from uh

[47:17] the current year to to next year.

[47:26] And I'll just leave it at that.

[47:27] Municipal Court and the rest we can

[47:29] cover next week.

[47:31] >> We can reconvene. I like that idea.

[47:33] Um

[47:33] thank you Miss Boyd very much. Um for

[47:35] the sake of time we have one public

[47:37] comment. Mr. Jose Boyce do you want to

[47:39] come up sir?

[47:54] » Thank you Mayor Mayor Garson

[47:56] Commissioners. I just had

[47:58] you know, this is very complicated for

[48:00] the community anyhow, but I just looked

[48:03] at three things

[48:05] for you to consider. Senate Bill 1851

[48:08] prohibits municipalities from raising

[48:11] tax rates above the no new revenue

[48:14] threshold if they fail to complete and

[48:17] submit required annual financial audits

[48:21] and statements.

[48:22] The next one is the most recent

[48:24] financial statement that was audited is

[48:26] 2024.

[48:28] And that it was called the 2024 annual

[48:30] comprehensive financial report

[48:33] PDF and the 2024 federal single audit

[48:37] report. That's the only thing that is

[48:38] posted.

[48:40] And then

[48:41] in that report, there were four sets of

[48:43] corrective actions included with the

[48:46] 2024 audit report and they have some

[48:49] deadlines, some of which are in June,

[48:51] July, August, and September 30th 30th of

[48:55] this year.

[48:56] So, when I look at all that, my main

[48:58] concern is that how can we calculate a

[49:01] no new revenue threshold? Can can we do

[49:04] that effectively and perhaps legally

[49:07] if we don't have any audits to to use as

[49:10] a basis. Thank you very much.

[49:12] >> Thank you.

[49:17] Mr. Boyce, just for the for the sake of

[49:18] the question, we do have an answer to

[49:20] that, so we'll definitely get back with

[49:22] you.

[49:25] Any No other comments? Is there a motion

[49:26] to adjourn?

[49:28] >> Make a motion to adjourn.

[49:30] >> Second.

[49:30] >> All in favor, say aye. All opposed, same

[49:32] sign. This meeting is adjourned.

[49:34] >> She said

[49:35] Good sign.

[49:36] >> Okay.

[49:37] >> Who seconded?

[49:38] >> Okay.

Budget Workshop: August 5, 2026

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