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Members of the public are invited to provide public comment, either in person or remotely via Zoom.

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The meeting is also available with live translation in more than 60 languages through wordly.

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Translation is accessible by mobile phone, computer or video displays in the council chambers by scanning the QR code located in the upper right corner of the agenda title page.

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City staff, please verify that virtual participation is available and operating.

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We did.

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It is available and we're operating.

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Thank you.

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Thank you, Susanne.

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With that, we'll move to today's business.

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City Clerk Gassetta, please call the roll.

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Council member Chua.

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Here.

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Council member Lam.

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Council member Leanne.

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Mayor Montana is absent and vice mayor Barbedo.

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Here,

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before we add you on to the close session,

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CDA Tony Curtis, please brief the public on the close session items for today.

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Thank you, Vice Mayor.

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There's one item on for close session today.

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That is conference with the Libre negotiator.

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For soon to government code section 54957.6,

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the agency's designated representative

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is Rick Balonus, Liberty Castery, with more.

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The employee organizations are professional and technical employees,

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mid management and confidential employees.

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will be this employee association, will be this peace officer's association, informational or sorry, international association of firefighters and the unrepresented employees.

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Thank you. Before we add you on to the call session, any public comment on the call session item.

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Do we have any speakers from Zoom?

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How long would you like close session to be tonight?

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We could have speakers speak about three minutes.

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Thank you.

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We have no public speaker cards at this time.

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Now, if for those participating remotely via Zoom,

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please click the raise hand button if you wish to address the city council.

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If you're participating by telephone dial star nine to raise your hand,

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when the last four digits of your phone number are called,

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you would dial them to star six to unmute and provide your comments.

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Let us see if we have anyone via Zoom.

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We have no public speakers via Zoom.

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Thank you, Susanne.

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We now adorned to the call session.

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Good morning.

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I said you can't be other than, but I'm

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fond of

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that.

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I was,

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I was five and

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I think how do you, how do you,

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tell me,

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I'll reach any of you.

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I'll reach the

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final.

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I'll say I'll be here.

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Good thing.

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It's now about 531. We are coming back for order. We just came from a procession. Is there anything that needs to be announced? Mr. City Attorney?

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No Vice Mayor, there is no reportable action at this time.

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Thank you. Let us all rise for the pledge of allegiance. Anybody?

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Thank you.

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Thank

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you, Council Member Leane.

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The night's invocation will also be provided by Council Member Leane.

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device mayor.

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With all the catastrophes and challenges facing community across our nation,

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I wish everyone safety, good health, and peace. May we continue to look out for one another,

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support those in need, work together with compassion, strength, and hope for the better days

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ahead. Thank you.

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Thank you.

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For a public forum, we have a lot of the three minutes for each public speaker.

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Now members of the public are invited to speak on any item that does not appear on today's

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agenda.

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Public comment may be provided both live and via Zoom.

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Any comment from the public?

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Yes.

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Mr. Vice Mayor.

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We do have several public forum comments.

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The first is going to be Rob Means, followed by Karen Friedman, and then we have Tavary

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Renderosh.

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Welcome, Mr. Means.

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Good evening, Council Mayor, or Vice Mayor, I guess now.

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I'm Rob Means, I'm representing the East Valley Democratic Club today, and in particular,

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you have received a questionnaire from the club. We intend to get responses from the candidates

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here in Milpetus for both Council and Mayor. And then post those online so that people,

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voters can really look into how you feel about a whole variety of issues that are,

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of notes, shall we say. I imagine that some of you will find some of the questions.

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It's

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very similar to what's going on with the South Bay Labor Council. They also provide an

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them-death questionnaire, I understand. So there shouldn't be something that's terribly

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new or difficult to fill out because you probably already done it for one of the other

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questionnaires that's been happening and we look forward to getting those when we do get those

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responses will be posting them online and letting people know where they can find them. Thank you.

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Thank you. Next we have Karen Friedman and that will be followed by Cavattie.

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Good afternoon. Good afternoon. Good afternoon council and staff. My name is Karen Friedman and I've been

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I've lived in Milpitas for 43 years.

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I value my first and fourth amendment rights to speech and privacy.

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My topic is the use of flock, safety, automatic license plate, reader cameras in our city.

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Float cameras have been used in federal immigration enforcement and in cross state reproductive

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health care investigations.

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And I appreciate that Mayor Montana has been listening to my concerns about flock, and I'm

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also grateful for Captain Matt Miller of the Milpetus Police Department.

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He explained carefully how flock cameras are used currently in the and monitored in the

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city of Milpetus.

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However, my focus today is more on flock's larger business plan to provide its cameras

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and AI-powered software to the federal government for a nationwide domestic surveillance network.

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The Chinese Communist Party does not allow dissent toward the government.

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In China, there are 700 million cameras, one camera for every two persons,

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with AI-powered surveillance and facial recognition,

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the CCP can track and locate an individual in a matter of minutes.

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The surveillance plan in the U.S. is not a conspiracy theory, it is happening now.

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Cash Patels FBI issued a statement of work in May of this year.

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The FBI wants to contract with a company able to build a network of nationwide surveillance cameras.

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As a largest producer, Flock is the first in line to be awarded this contract, and Big

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Tech has already agreed to share AI technology with the federal government.

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Although Flock contracts read as all the data produced are the sole property of the

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participating jurisdictions, Flock can access and share our data.

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Fortunately, there is much publicity on this topic, and jurisdictions all over the country

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are canceling contracts with flock.

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Locally the mercury just reported Stanford ditched its flock cameras and chose a different vendor.

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Santa Clara County and Mountain View have ended their contracts and Palo Alto is taking a serious look

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and there are many more.

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Captain Miller is diligent in conducting regular audits here

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and there have been no federal searches as of this point to be clear.

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I support and trust our police department and they do need effective tools for criminal investigation.

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Still, I don't want our city to be drawn into a system of nationwide surveillance by continuing its association with flock.

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Am I out of time?

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May I just do one more sentence?

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My ask is for the council and staff to further educate themselves on this topic and along with

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no Peters Police Department to find a suitable alternative to using flock in our city.

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Thank you.

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Thank you.

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Next, we have Kavari.

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Who do you need, Vice Mayor?

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And the manager and all the council members.

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I'm here following up about the small cell tower. What happened? And last time we had the meeting and we were told at the time by the city engineer.

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They're going to conduct independent company to do the testing about the radio frequency.

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And we want to know what is happening and we haven't heard anything about it.

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So most probably we are as a group will be coming for the meeting to find out what is going

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on with that and then still it is a very unsettled among all of us.

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How close to the house it is and what is really happening to anybody's health we don't

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know.

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So, that's the small things since I'm here. I doubt I'll bring it up. Thank you all.

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Thank you. Thank you for reminding us and hopefully we'll have a response soon.

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That's the last of the public speaker cards in person. Now I will ask for any public

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speakers via Zoom. If you're participating remotely via Zoom and wish to address the city council

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under public forum, please select the raise hand button. If you're participating by telephone

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I'll start nine to raise your hand when the last four digits of your phone number are called dial stars six to unmute and provide your comments.

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Are there is there anyone on zoom that wishes to address the city council.

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I have no hands raised that is the end of public forum.

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Mr. Vice Mayor.

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Thank you, Suzanne.

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So now we're moving on to the announcement of conflicts of interest and campaign contributions for both the meetings today.

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Mr. City of Tony.

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Thank you, Vice Mayor.

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This time, I would ask the mayor and each council member whether he or she has any financial or personal conflict of interest.

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Related to any of the items on tonight's agenda.

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Councilmember Chua?

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No.

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Councilmember Lam?

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No.

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Councilmember Leon?

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Vice Mayor Barbedee of?

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None.

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And Mayor, I would also ask the mayor or sorry.

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Vice Mayor, and the members of the Milpita City Council, please disclose any campaign contributions of

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dollars or more, received within the last 12 months, for many of the parties entering into contracts

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with the city on tonight's agenda, or contributions received from development project applicants

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for development projects on tonight's agenda.

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Council Member Choa, Nann, Council Member Lam, Nann, Council Member Lien, Nann, Vice Mayor

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Barbadillo, Nann, I would ask that the record reflects no reported conflicts.

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The Milpita City Council is guided by our own code of conduct.

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Anyone from us read or conduct conductives?

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If not, I would have wanted to do that.

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Milpita City Code of conduct be respectful and courtes,

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model, civility, avoid surprises, praise publicly and criticize privately, focus on the issue

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and not on the person.

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Use electronic devices appropriately while on the council days, disclose conflicts of

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interest and affiliations related to the agenda items.

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The council speaks with one voice after making policy on issues, respect the line between policy

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administration and council will hold one another accountable to comply with this

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code of conduct.

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Moving on to the approval of agenda, as anyone if there are changes,

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council?

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The announcement was approved the agenda.

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Second,

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so that was a motion by Councilor Chua, seconded by Councilmember Lianne and now

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call for the vote. Councilmember Chewa, I, Councilmember Lam, Councilmember Lien, I, Vice Mayor

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Barbara Dio.

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I, next from the item will be the consent calendar, any comments from staff or

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changes.

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Okay, the city council

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moved to approve the consent calendar. Second,

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before we take a vote,

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Any public comment on the consent calendar?

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I have no public speaker cards for the consent calendar, but I will also ask on Zoom if anyone would like to address the council on the consent calendar.

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To please raise their hand now or if they're participating by phone to please press star nine.

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I have no comments for the consent calendar.

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We will call for the vote.

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That was my motion by council member Chua and the second by council member Liam.

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Council Member Chua, I, Council Member Lam, I, Council Member Leanne, I, Vice Mayor Barbara

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Deo.

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I,

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moving on to the public, okay, we have a unanimous approving at the constant calendar

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as agenda is now moving on to the public hearings as a city manager.

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Just to vice, vice mayor, item number 13 is consider introducing an ordinance to amend the

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No, Peter's Municipal Code, Title 8, Chapter B, 0.6, B.8, C10, and E4, relating to the regulation

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of tobacco retailers.

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Our staff contact is directly directly in the planning department.

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And our recommendation from this item is that the ordinance is to exempt from the California

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Environmental Quality Act, pursuant to SQL Guidelines, Section 15183, directly.

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Good evening, Vice Mayor and Council members.

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We're here to present this item before you and we have Lily and Van Hoa, a principal planner here today.

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We'll deliver the presentation.

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Thank you, Director Lee. Good evening. Vice Mayor, council member, city manager and fellow staff.

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My name is William Van Hawa, principal planner with the City of Mopedis planning department.

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Next slide, please.

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The application before you tonight is a city initiated zoning ordinance

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text amendment to modify and add regulations to limit the concentration of tobacco retailers within the city

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and encourage responsible tobacco retelling.

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The proposed amendments would specifically prohibit

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new tobacco retailers from locating within a certain distance

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from existing tobacco retailers and youth sensitive areas

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or schools in this instance and prohibit the sale of

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flavored tobacco products and adopt other local regulatory standards.

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Next slide, please.

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Tobacco is a number one preventable cause of death in California

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nearly 40,000 deaths per year.

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In Santa Clara County, one in eight deaths annually

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is attributed to smoking-related illness.

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25.3% of Santa Clara County high school students

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have used a tobacco product.

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And E. cigarettes are the most popular tobacco product,

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with 23% of high school students having used them.

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93.1% of current teen tobacco users in current Santa Clara County

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report using a flavor tobacco product.

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And in 2019, more than 86% of tobacco retailers

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near schools sold flavored non-sigarette tobacco products.

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Next slide, please.

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And more than half of Santa Clara teens

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who may have reported purchasing their own products,

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over one and five of those teens

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by directly from a store.

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01:46:58,140 --> 01:47:02,980
71% of in-store purchases bought out of tobacco shops,

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01:47:02,980 --> 01:47:08,000
Smoke shop, or have been bought at a tobacco shop, smoke shop, or a fap shop.

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01:47:08,800 --> 01:47:16,080
And nearly 81% of youth ages, 12 to 17, who used tobacco, report their first product was flavored.

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01:47:17,240 --> 01:47:22,800
And children are more likely to experiment with tobacco when retailers are located in your homes and schools.

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01:47:22,800 --> 01:47:24,560
Next slide please.

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01:47:27,630 --> 01:47:38,110
So the Santa Clara County Healthy Cities Program seeks to address tobacco related health concerns by promoting policies and practices to provide tobacco free and smoke free communities.

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01:47:39,050 --> 01:47:50,550
The Santa Clara County Public Health Department has provided funding to cities to support these tobacco prevention strategies known to have the highest impact on reducing tobacco related disparities and inequities.

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01:47:51,330 --> 01:47:58,450
So in June, or sorry, in July of 2020, following the City Council's request to explore policies

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01:47:58,450 --> 01:48:04,830
to discourage tobacco use and vaping by teens, the city executed a grant agreement with

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01:48:04,830 --> 01:48:09,630
the county public health department to explore tobacco prevention policies, shown to reduce

252
01:48:09,630 --> 01:48:12,410
youth access and exposure to tobacco products.

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01:48:13,330 --> 01:48:19,210
In June 2021, the city adopted an ordinance to prohibit smoking and multi-unit residences

254
01:48:19,210 --> 01:48:23,090
and many outdoor areas to reduce exposure to second-hand smoke.

255
01:48:24,710 --> 01:48:27,270
And then in June 21 of 2022,

256
01:48:27,990 --> 01:48:30,270
the City Council directed staff to develop

257
01:48:30,270 --> 01:48:32,870
a tobacco retail permitting program with the county.

258
01:48:33,750 --> 01:48:35,830
However, this was not ultimately executed

259
01:48:35,830 --> 01:48:39,590
due to county enforcement requirements and staffing constraints.

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01:48:40,510 --> 01:48:55,150
And in March 29, 2024, the city was awarded a grant of $22,997 from the county to reduce the density of tobacco retailers and their location near a sensitive area.

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01:48:56,830 --> 01:49:05,810
And on June 10th of this year in 26, the Planning Commission held a public hearing and recommended that the city council approved ordinance that is before the council tonight.

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01:49:05,810 --> 01:49:18,060
Next I will highlight some recent state law on tobacco, SB 793 prohibits the sale of most

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01:49:18,060 --> 01:49:26,860
flavor tobacco products statewide and it allows for a stricter local ordinances and in November

264
01:49:26,860 --> 01:49:36,480
2022 California voters voted to uphold SB 793 at the ballot box and then AB 935 strength

265
01:49:36,480 --> 01:49:42,380
enforcement of the flavor tobacco retell law. It brought in the definition of retell location.

266
01:49:44,280 --> 01:49:51,320
AB 3218 requires creation of the unflaver tobacco list by the California Attorney General.

267
01:49:52,100 --> 01:49:56,200
And lastly, state law prohibits sale of tobacco to anyone under the age of 21.

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01:49:57,420 --> 01:49:58,120
Next slide, please.

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01:50:04,400 --> 01:50:08,600
So there were 38 tobacco retellers within the city on the map on the screen.

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01:50:08,600 --> 01:50:13,340
and this was developed as of February 2026.

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01:50:14,720 --> 01:50:20,460
This, the data is from a list that's maintained by the California Department of Tax

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01:50:20,460 --> 01:50:24,440
and the administration, also known as the CDTFA.

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01:50:24,440 --> 01:50:31,700
However, one staff pulled the list from the CDTFA in August this month.

274
01:50:32,120 --> 01:50:34,720
There are now 42 DACA retailers within the city.

275
01:50:34,720 --> 01:50:40,400
This list is updated on a monthly basis for the CDTFA.

276
01:50:40,760 --> 01:50:47,600
It's worth noting that the list in the map does not include any retailers that are not registered with the state or selling illegally.

277
01:50:49,860 --> 01:50:57,600
The majority of these tobacco retailers are liquor stores, gas stations and grocery stores.

278
01:50:57,600 --> 01:51:07,840
Three of them are a standalone smoke tobacco shops, and areas of high concentration shown in the map are North

279
01:51:07,840 --> 01:51:19,260
Mopias Boulevard and Dixon, Dixon Landing, West Calabar as Boulevard and I680 and East Calabar as Boulevard and South Park Victoria.

280
01:51:20,800 --> 01:51:21,720
Next slide, please.

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01:51:21,720 --> 01:51:22,940
So

282
01:51:25,210 --> 01:51:28,750
the proposed ordinance will specifically do the following things.

283
01:51:29,890 --> 01:51:38,910
It will establish a location buffer so no new tobacco retailers will be allowed to open within a thousand feet of a school, both public and private.

284
01:51:40,410 --> 01:51:44,410
There will also be a retailer separation distance of 500 feet.

285
01:51:44,890 --> 01:51:52,870
The distances would be measured in a straight line from the nearest entrance to the nearest entrance or property line to the schools.

286
01:51:53,970 --> 01:52:01,550
It will also prohibit tobacco sales at pharmacies and it will also codify the ban on flavor

287
01:52:01,550 --> 01:52:06,930
tobacco products, including flavored e-cigarettes, mental cigarettes, flavored cigars,

288
01:52:07,670 --> 01:52:09,710
Puka, Shisha, and e-liquids.

289
01:52:11,630 --> 01:52:17,250
And all accessory tobacco retail sales will require a minor conditional use permit,

290
01:52:17,250 --> 01:52:27,270
approval at the staff level, the current MCUP fee is $1500, $1,526,

291
01:52:29,530 --> 01:52:29,830
and all

292
01:52:29,830 --> 01:52:29,970
Thanks.

293
01:52:30,000 --> 01:52:34,860
Disting retailers that are within the buffers will become legally not conforming uses.

294
01:52:35,460 --> 01:52:36,360
Next slide, please.

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01:52:40,340 --> 01:52:48,340
Here's, oh, back. Thank you. Here's the proposed buffer overlaid onto the city zoning map.

296
01:52:48,380 --> 01:52:56,620
This is attachment C to the agenda report. The small triangles on the on the screen are the tobacco retailers.

297
01:52:56,620 --> 01:53:05,500
and then the purple building with the flag are all of the private and public schools within the city.

298
01:53:05,880 --> 01:53:11,860
So the larger buffers are around the schools and then there's smaller buffers for the retailers.

299
01:53:12,740 --> 01:53:20,740
So as you can see, a lot of the commercial areas where a new tobacco retailer could open,

300
01:53:20,740 --> 01:53:27,560
It's pretty limited now once we have this ordinance if the council approves ordinance tonight

301
01:53:28,620 --> 01:53:29,800
Next slide please

302
01:53:32,240 --> 01:53:39,400
So here's a look at what other cities have done in Santa Clara County. The cities of Cupertino

303
01:53:39,400 --> 01:53:47,260
Gilroy, Los Altoes, Los Gados, Palo Alto, Saratoga, and unincorporated Santa Clara County have codified that thousand foot

304
01:53:47,780 --> 01:53:48,660
school buffer

305
01:53:48,660 --> 01:53:52,080
And the same jurisdictions previously mentioned,

306
01:53:52,380 --> 01:53:57,400
except for Gilroy, have also codified the 500-foot retailer separation.

307
01:53:58,960 --> 01:54:05,000
Oscados Palo Alto, Seratoga, and Unincorporated County have codified the pharmacy to back-o-ban.

308
01:54:06,460 --> 01:54:15,540
Cupertino, Los Altos, Oscados, Morgan Hill, Palo Alto, Seratoga, Sunnyville, and Santa Clara County have codified the flavor to back-o-ban.

309
01:54:16,260 --> 01:54:22,920
And overall, more than 50 local governments in California restrict tobacco retail locations near schools.

310
01:54:23,820 --> 01:54:24,520
Excite, please.

311
01:54:27,550 --> 01:54:32,450
The proposed zoning tax amendment is exempt from CEQA, pursuant to CEQA guidelines section

312
01:54:34,570 --> 01:54:40,030
15061B3, common sense exemption, so there's no possibility of a significant environmental effect.

313
01:54:40,030 --> 01:54:47,770
and Sequo Guideline Sections 1-5183 Project Consistent with General Plan for which an EIR has been certified.

314
01:54:48,690 --> 01:54:53,210
The ordinance is not effected entities or intensities of previously allowed uses.

315
01:54:54,470 --> 01:54:54,990
Next slide, please.

316
01:54:58,920 --> 01:55:05,260
An online community survey was conducted in July 15th to August 31, 2020.

317
01:55:05,260 --> 01:55:13,420
125 responses were received. And during the outreach, the spring staff visited 38 tobacco retailers

318
01:55:13,420 --> 01:55:20,620
and distributed community meeting fires during the month of April. The online community meeting

319
01:55:20,620 --> 01:55:29,660
was held on April 29, 2026, no community members participated. Three comments were received prior to

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01:55:29,660 --> 01:55:34,540
the Planning Commission hearing and there was one speaker at the Planning Commission hearing.

321
01:55:35,260 --> 01:55:40,160
The Planning Commission voted 60 votes to recommend that the city council approved the ordinance.

322
01:55:41,220 --> 01:55:46,240
And a public hearing notice was published in the Milpita's post on July 17, 2026

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01:55:46,240 --> 01:55:50,580
and posted at City Hall and on the city website. Next slide, please.

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01:55:54,640 --> 01:55:55,740
Staff has confirmed that the

325
01:55:55,740 --> 01:55:59,940
project meets the findings associated with zoning text amendment for the proposed to

326
01:55:59,940 --> 01:56:03,360
or retailer ordinance, I set out in the Mopetus Municipal Code.

327
01:56:04,280 --> 01:56:08,000
The project is consistent with the city's general plan goals and policies.

328
01:56:08,700 --> 01:56:11,140
It is consistent with the Metro and Gateway Main Street

329
01:56:11,140 --> 01:56:12,880
specific plan goals and policies.

330
01:56:13,620 --> 01:56:17,100
It will not be detrimental to public health, safety, convenience,

331
01:56:17,320 --> 01:56:18,080
or general welfare.

332
01:56:18,780 --> 01:56:20,340
It is compliant with CEQUA.

333
01:56:20,680 --> 01:56:23,100
It is not reduced residential density

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01:56:23,100 --> 01:56:26,340
and will not result in a net loss of potential housing units.

335
01:56:26,340 --> 01:56:32,620
and it is internally consistent with other applicable provisions of Title 13.

336
01:56:33,160 --> 01:56:37,680
And those findings have been discussed in the staff report and are addressed in the resolution.

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01:56:38,620 --> 01:56:39,320
Next slide please.

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01:56:42,090 --> 01:56:47,250
In closing, staff recommends that the City Council open and close the public hearing and determine

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01:56:47,250 --> 01:56:56,630
that the ordinance is exempt from sequa pursuant to sequa-kireline section 15183 and 15061B3 and

340
01:56:56,630 --> 01:57:05,390
introduce an ordinance adding a new section to title 13 chapters B6, B8, C10, and E4 of the

341
01:57:05,390 --> 01:57:09,250
Melpeetus Municipal Code relating to the regulation of tobacco retailers.

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01:57:10,070 --> 01:57:13,030
That concludes staff's presentation. I'd be happy to answer any questions.

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01:57:18,180 --> 01:57:26,000
Then decide them for a public hearing. Anybody from the public or from Zoom? Have any comments?

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01:57:26,000 --> 01:57:32,260
Madam Clerk. I have no public speaker cards in person. However, I do have a hand-raised

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01:57:32,260 --> 01:57:38,620
in Zoom. I will be calling on Chris Miller on Zoom. I will hit allow to talk and then you will

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01:57:38,620 --> 01:57:46,420
have three minutes. You can unmute yourself now, Chris. Thank you. Good evening, council. My name is

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01:57:46,420 --> 01:57:53,000
Chris Miller. Life long last got a president. I enjoy visiting Mel Pides, so thank you for making

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01:57:53,000 --> 01:57:59,860
can be great. I am 99% support of the proposal. However, I have significant concern about the proposal,

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01:58:00,420 --> 01:58:05,120
that retailers are required to ask for IDs for individuals' decades over the minimum purchase

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01:58:05,120 --> 01:58:11,460
age. I did send an email over the weekend, hopefully you all received that. My question is what

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01:58:11,460 --> 01:58:17,060
is the purpose of requiring a citizen who is supposed age 90 to show that their identification

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01:58:17,060 --> 01:58:19,280
to identification that they are over 21.

353
01:58:20,320 --> 01:58:22,700
There is lack of research justification

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01:58:22,700 --> 01:58:24,940
for requiring ID of older adults,

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01:58:25,280 --> 01:58:26,920
where at least have been provided to me.

356
01:58:27,140 --> 01:58:29,220
There's possible consequence of additional work

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01:58:29,220 --> 01:58:33,960
by law enforcement, by enacting any ID requirement.

358
01:58:34,500 --> 01:58:36,860
Federal law suggests an age of 30

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01:58:36,860 --> 01:58:40,180
as per the FDA in 2024, and most importantly,

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01:58:40,480 --> 01:58:42,840
a staff member in district five board of supervisors

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01:58:42,840 --> 01:58:45,940
is on record stating that they are looking

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01:58:45,940 --> 01:58:52,880
to when this comes back to the county to add age next time the model policy is would be revised.

363
01:58:53,700 --> 01:58:58,500
Just earlier this summer, the city of Gilroy revised their tobacco retail permit process

364
01:58:58,500 --> 01:59:04,020
and included in appears to be language, which is in congruence with the FDA. I kindly asked

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01:59:04,020 --> 01:59:11,480
the council add language proposed ordinance, something to the effect of appears to be under age 30. Thank you.

366
01:59:19,720 --> 01:59:24,820
If anyone else on Zoom would like to address the City Council, please raise your hand now

367
01:59:24,820 --> 01:59:27,240
or if you are on phone, press star 9.

368
01:59:29,260 --> 01:59:31,700
I have no additional public speakers, Mr. Vice Mayor.

369
01:59:32,380 --> 01:59:38,160
Thank you. So we're closing at the public hearing. Let's move to any council discussions.

370
01:59:41,130 --> 01:59:44,190
Mr. Vice Mayor, will the council is considering any questions or discussion?

371
01:59:44,410 --> 01:59:47,850
It would be right if I were to introduce the ordinance to be a reading of the time of this time.

372
01:59:48,090 --> 01:59:50,170
Yes, please, Mr. City Attorney. Let's do that.

373
01:59:50,170 --> 01:59:51,730
Thank you, Vice Mayor.

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01:59:52,590 --> 01:59:57,550
Before the council is an ordinance entitled an ordinance of the City Council of the City of Melpedis,

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01:59:57,750 --> 01:59:59,970
amending the Melpedis Municipal Code title.

376
02:00:00,000 --> 02:00:07,260
13, chapters B6, B8, C10 and E4 relating to the regulation of tobacco retailers.

377
02:00:09,480 --> 02:00:13,420
Thank you. Going back to any council discussion.

378
02:00:22,160 --> 02:00:24,820
Council member Chua. Thank you Vice Mayor.

379
02:00:26,560 --> 02:00:34,400
directly or senior planner one way.

380
02:00:36,570 --> 02:00:43,570
Can you briefly explain just briefly explain the sections that were added.

381
02:00:45,070 --> 02:00:55,550
So everybody can understand. It's B6, B8, C10 and E4 briefly. Thank you.

382
02:00:55,550 --> 02:01:11,370
Sure. So, we modified the use tables under the commercial zone use regulation, as well

383
02:01:11,370 --> 02:01:16,290
as the mixed use table regulation,

384
02:01:18,490 --> 02:01:23,450
this is V16, go by different.

385
02:01:23,950 --> 02:01:29,470
So B6 is the commercial zone use regulation table and

386
02:01:32,090 --> 02:01:36,050
then table B, section B8 is the next

387
02:01:36,050 --> 02:01:38,670
use zone regulation table.

388
02:01:46,290 --> 02:01:53,410
And then we added a new subsection to chapter C10 specific to

389
02:01:53,410 --> 02:02:02,850
uses and titled it Smoke Tobacco Uses. So that outlines all of the performance standards that

390
02:02:02,850 --> 02:02:08,190
would apply to smoke tobacco uses and tobacco retailers.

391
02:02:09,090 --> 02:02:14,230
Now about C4, E4 is the definition section

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02:02:14,230 --> 02:02:16,970
of the zoning ordinance.

393
02:02:17,790 --> 02:02:21,290
And so we added definitions related

394
02:02:21,290 --> 02:02:24,170
to tobacco retail that weren't previously there.

395
02:02:24,530 --> 02:02:29,870
So they're further defined in the definition section.

396
02:02:29,870 --> 02:02:35,970
Can you briefly explain those additional burbage?

397
02:02:37,190 --> 02:02:44,270
So for example we added a definition for electronic smoking device because we previously did not have that definition.

398
02:02:45,250 --> 02:02:46,070
What's the definition?

399
02:02:48,230 --> 02:02:55,970
It is any device that may be used to deliver and aerosolized or vaporized substance to the person in healing from the device,

400
02:02:55,970 --> 02:03:01,230
including but not limited to an e-cigarette, e-cigarette, e-cigarette, e-pipe,

401
02:03:01,830 --> 02:03:07,690
date pen, electronic, e-cigarette, tobacco products, or e-hooka. Do you want me to continue?

402
02:03:08,510 --> 02:03:14,110
But I just wanted to see if e-cigarette is there. And it is there.

403
02:03:14,190 --> 02:03:17,270
Yeah, that's how we would define it. It's an electronic smoking device.

404
02:03:18,030 --> 02:03:21,110
Okay. What else is the new terminology? You said.

405
02:03:27,760 --> 02:03:40,720
So we've revised the definition of smoke tobacco shop, so we already had that in our

406
02:03:40,720 --> 02:03:45,980
definition section, but we revised it to say a retail establishment primarily

407
02:03:45,980 --> 02:03:51,360
engage in the selling of smoking, or tobacco products, accessories,

408
02:03:56,200 --> 02:03:56,820
or

409
02:03:56,820 --> 02:04:02,760
simply assume to be used for smoking and or the inhalation or ingestion of any substance.

410
02:04:04,340 --> 02:04:06,100
So it's ink on passes. Everybody.

411
02:04:08,120 --> 02:04:09,440
It's the whole, yes.

412
02:04:10,120 --> 02:04:12,380
Included everybody on it. Correct.

413
02:04:13,940 --> 02:04:22,620
And then we also added the tobacco accessories or paraphernalia definition and tobacco product, as well as tobacco retailer.

414
02:04:22,620 --> 02:04:26,480
Those three definitions were not previously in our zoning ordinance.

415
02:04:28,340 --> 02:04:30,160
Can you read that too?

416
02:04:32,320 --> 02:04:34,460
So tobacco accessories are paraphernalia.

417
02:04:34,580 --> 02:04:39,900
Our devices are instruments for smoking, heating, chewing, absorbing, dissolving,

418
02:04:40,040 --> 02:04:46,720
inhaling, snorting, sniffing, or ingesting by any other means to tobacco products or other controlled substances.

419
02:04:46,720 --> 02:05:16,860
And then tobacco product is any product containing made of or derived from nicotine or tobacco that is intended for human consumption or is likely to be consumed whether smoked, heated, chewed, absorbed, dissolved, inhaled, snorted, sniffed or ingested by any other means, including, but not limited, cigarette, a cigar, pipe tobacco, chewing tobacco, snuff or snuff, snuff, snuff, snuff, snuff, snuff.

420
02:05:16,860 --> 02:05:21,840
that's how that's pronounced. And then any electronic, it also includes any electronic

421
02:05:21,840 --> 02:05:27,360
smoking device and any substances that may be aerosolized or vaporized by such device

422
02:05:27,360 --> 02:05:37,380
and that contain nicotine or any component part or accessory of the first two whether or not

423
02:05:37,380 --> 02:05:41,860
whether or not separately and whether or not they contain nicotine or tobacco, including

424
02:05:41,860 --> 02:05:44,820
but not limited to filters, rolling papers,

425
02:05:45,160 --> 02:05:46,320
flan or hemp wrappers,

426
02:05:47,020 --> 02:05:48,440
Pukas, mouthpieces and pipes.

427
02:05:49,220 --> 02:05:50,020
Okay, that's good.

428
02:05:50,880 --> 02:05:57,800
Where was the addition of chains to the 1,000 feet,

429
02:05:59,800 --> 02:06:02,580
the limitation within the school?

430
02:06:03,020 --> 02:06:04,020
Where was that added?

431
02:06:04,220 --> 02:06:10,200
So with under, I think it's C10 under the smoke tobacco,

432
02:06:11,060 --> 02:06:18,320
uses. So that's a performance standard that is specific to that use. So there's a separation

433
02:06:18,320 --> 02:06:26,320
of climate change. Yes. There are 1,000 distance from school to any of the establishment to

434
02:06:26,320 --> 02:06:31,760
the back of establishments. Okay, sounds good. Thank you. Thank you, Vice-Nayer.

435
02:06:42,550 --> 02:06:43,450
Thank you,

436
02:06:43,450 --> 02:06:47,150
Vice Mayor. Chief Hernandez.

437
02:06:58,210 --> 02:07:08,390
Thank you. How often do we inspect these shops and has they've been

438
02:07:08,390 --> 02:07:16,550
any violations in our city? I'll actually ask Captain Perody to step to the microphone. We have

439
02:07:16,550 --> 02:07:22,650
had some enforcement action more recently but I don't know the answer to how frequently we're

440
02:07:22,650 --> 02:07:24,030
going into the shops.

441
02:07:27,590 --> 02:07:28,310
Thank you.

442
02:07:28,350 --> 02:07:28,830
It's too pretty.

443
02:07:29,170 --> 02:07:29,870
Captain Police Department.

444
02:07:30,950 --> 02:07:39,530
Primarily it's complaint based, so when a community member reaches out about illegal tobacco cells, we'll take a report and we'll look into it.

445
02:07:39,710 --> 02:07:54,210
Within this past year, we received a handful of reports, and we conducted inspections with the state at specifically standalone smoke shops, two separate ones, which led to criminal charges.

446
02:07:54,210 --> 02:08:01,590
outside of that. There's not many. We don't inspect grocery stores. That's usually done by a state organization.

447
02:08:03,550 --> 02:08:09,930
Okay. And do you notice that there's one area that's more than others or

448
02:08:09,930 --> 02:08:15,450
how you don't inspect the shops that has no complaints?

449
02:08:16,330 --> 02:08:20,340
Correct. The inspections are usually done by a separate state tax organization.

450
02:08:20,340 --> 02:08:34,140
And we respond when it comes to tobacco, we respond to criminal complaints of illegal sales, like to youth or sales of illegal items such as flavor tobacco or marijuana.

451
02:08:35,860 --> 02:08:43,020
Okay, and would you revisit that same store to see if there's any violations after that?

452
02:08:43,020 --> 02:08:45,580
Yeah, we have several methods of investigation.

453
02:08:46,640 --> 02:08:49,180
The two most recent ones that we looked into

454
02:08:49,180 --> 02:08:53,280
led to criminal search warrants being conducted there

455
02:08:53,280 --> 02:08:56,940
where illegal merchandise was confiscated

456
02:08:56,940 --> 02:09:00,320
and it was a criminal report to the district attorney's office

457
02:09:00,320 --> 02:09:02,560
in the past two that we have done this year.

458
02:09:02,720 --> 02:09:04,420
Okay. Thank you. Thank you Chief.

459
02:09:05,100 --> 02:09:06,080
Of course. Thank you, Vice Mayor.

460
02:09:06,900 --> 02:09:08,680
Thank you, Council Member Lee and

461
02:09:15,340 --> 02:09:16,160
Council Member Lemp.

462
02:09:16,160 --> 02:09:28,220
Thank you, Vice Mayor. My question is related to checking ID under the current municipal court.

463
02:09:29,060 --> 02:09:34,820
What is the law sets for now or checking IDs?

464
02:09:39,390 --> 02:09:51,890
So, the the current the ordinance before you tonight requires retailers to check ID for all individuals when they're purchasing tobacco.

465
02:09:54,810 --> 02:09:55,430
Okay,

466
02:10:04,600 --> 02:10:15,120
so that means anyone who purchased tobacco doesn't matter is a grocery store supermarket or tobacco stores, they need to show ID.

467
02:10:19,800 --> 02:10:21,480
Okay. Thank you.

468
02:10:26,930 --> 02:10:33,110
I also have a question, if you're done, a question to. So most of the good

469
02:10:33,110 --> 02:10:40,790
captain reported, the violations were mostly sailed by retailers of Flavewood to Baco.

470
02:10:41,830 --> 02:10:48,490
And this ordinance is different. The question is, are the non-permitted or non-licensed

471
02:10:48,490 --> 02:10:53,290
sellers that just retailers are covered by these ordinance.

472
02:10:57,960 --> 02:10:58,880
Let's say somebody

473
02:10:59,580 --> 02:11:06,980
have a box of something that we do not permit to be sold within a thousand feet from a school.

474
02:11:08,100 --> 02:11:11,580
And I'm talking about those particular situations.

475
02:11:17,650 --> 02:11:22,970
So this ordinance would apply to all tobacco retailers, whether permitted or not, it would just be

476
02:11:22,970 --> 02:11:29,390
difficult to enforce if they haven't gone through any procedure because there would be no documentation,

477
02:11:30,350 --> 02:11:36,490
but we would just follow our typical code enforcement processes. For example, if there was an

478
02:11:36,490 --> 02:11:43,930
unpermitted retailer within a thousand feet of a school and they wouldn't ever be able to be legalized,

479
02:11:44,770 --> 02:11:48,710
so then we would take the appropriate code enforcement actions and they wouldn't be able to

480
02:11:48,710 --> 02:11:55,830
back one more. Okay, good to know it's just an extra layer of trying to deter

481
02:11:56,470 --> 02:12:02,970
salaries if this audience includes not just the retailer that have permission to sell to Beaco

482
02:12:02,970 --> 02:12:08,170
and those were the individual or retailers that didn't have a premium.

483
02:12:08,410 --> 02:12:14,430
But if I may, this is structured as a land use ordinance. So if we're not talking about retail,

484
02:12:14,430 --> 02:12:20,190
to say it takes location, like if you were talking about, say, a street vendor or something

485
02:12:20,190 --> 02:12:23,610
along those lines, I'm not sure, would fall under this particular ordinance.

486
02:12:24,310 --> 02:12:27,790
There are other laws that may be violated as part of that.

487
02:12:29,810 --> 02:12:30,130
All right.

488
02:12:30,590 --> 02:12:31,110
So, yes.

489
02:12:31,110 --> 02:12:32,150
Valley, they are.

490
02:12:32,590 --> 02:12:38,750
I just thought that this isn't an extra layer on them, but thank you for the clarification,

491
02:12:39,070 --> 02:12:39,610
see that time.

492
02:12:40,290 --> 02:12:47,550
I think I'm fine with the audience and what would be the pleasure of the council.

493
02:12:54,450 --> 02:12:55,830
Any motion?

494
02:13:04,020 --> 02:13:04,660
Yes,

495
02:13:06,720 --> 02:13:07,000
please.

496
02:13:08,240 --> 02:13:13,120
The motion also needs to include waving beyond the reading of the title of the ordinance.

497
02:13:15,280 --> 02:13:16,100
Okay, that.

498
02:13:16,840 --> 02:13:18,080
Thank you.

499
02:13:19,360 --> 02:13:20,660
Any second on that?

500
02:13:20,660 --> 02:13:21,880
Yes.

501
02:13:24,940 --> 02:13:25,600
Any second?

502
02:13:31,940 --> 02:13:32,380
All right, second.

503
02:13:33,060 --> 02:13:34,660
Thank you.

504
02:13:35,040 --> 02:13:39,380
With Councilmember Leanne making the motion in a second by Councilmember Lam.

505
02:13:39,500 --> 02:13:40,820
I'll now call for the vote.

506
02:13:41,520 --> 02:13:42,240
Councilmember Chua?

507
02:13:43,860 --> 02:13:44,760
Councilmember Lam.

508
02:13:45,460 --> 02:13:45,780
All right.

509
02:13:46,040 --> 02:13:46,820
Councilmember Leanne?

510
02:13:47,580 --> 02:13:48,740
Vice Mayor Barbidillo?

511
02:13:51,000 --> 02:13:51,860
The motion passes.

512
02:13:52,800 --> 02:13:53,900
Thank you.

513
02:13:54,720 --> 02:13:57,000
Coming to our last item for tonight.

514
02:13:57,000 --> 02:13:58,120
at the emergency?

515
02:13:59,660 --> 02:14:02,520
Mr. Vice-Marm Council Under-lead

516
02:14:02,520 --> 02:14:12,030
Of course, the support services item number 14 receives a presentation of

517
02:14:12,030 --> 02:14:13,330
municipal barn 101.

518
02:14:13,970 --> 02:14:16,130
Iftaf Contact is a fine-ass director.

519
02:14:21,540 --> 02:14:25,460
The recommendation is to receive the presentation from the city municipal and

520
02:14:25,460 --> 02:14:29,820
visa on a barn council, municipal barn financing, including the types of

521
02:14:29,820 --> 02:14:31,100
available to the city.

522
02:14:31,100 --> 02:14:37,440
the financing process and financing team role, the City Council's disclosure and approval

523
02:14:37,440 --> 02:14:43,580
responsibilities, and an overview of the city's outstanding long-term obligations.

524
02:14:45,740 --> 02:14:47,020
Madam Finance Director.

525
02:14:50,220 --> 02:14:56,280
Good evening, Vice Mayor of Ardbadillo, Council members, Tua, Leon and Lam.

526
02:14:56,280 --> 02:14:59,980
Luzco Fressey Health Finance Director for the City of Mopee.

527
02:15:00,000 --> 02:15:15,460
It is. Suzanne is walking around and handing out some small items. Before you, you have a concept presentation of, uh, we will be doing what's called a municipal bonds 101 today.

528
02:15:16,140 --> 02:15:22,760
Vice Mayor Barbara Dio, I know that you did 2015 and I also think you did 2020 with us.

529
02:15:22,760 --> 02:15:28,100
He's gone to this before, and the mayor has also done it three times.

530
02:15:28,240 --> 02:15:29,100
So she's up on you.

531
02:15:29,160 --> 02:15:33,480
One of both of you were here for the 2015 boundary funding.

532
02:15:34,060 --> 02:15:38,440
So what this is, and essentially, is just a training for what we're proposing and bringing

533
02:15:38,440 --> 02:15:44,080
back to this council for consideration on September 1st, and also to get us into the mode

534
02:15:44,080 --> 02:15:50,600
of what we need to do when we are under what we need to understand as far as responsibilities

535
02:15:50,600 --> 02:15:57,920
in the process of municipal bonds before municipal bonding and debt. We have with us today and I'm

536
02:15:57,920 --> 02:16:07,340
going to defer to them is our municipal advisor from fieldmen and they'll give you they'll introduce

537
02:16:07,340 --> 02:16:15,200
themselves and also our bond council from Jones Hall and what you have before you basically is

538
02:16:15,200 --> 02:16:22,480
demonstration of how we finance the steps to finance and we're using fire station too which

539
02:16:22,480 --> 02:16:27,840
was financed through debt and then on the back are the SCC rules and we'll go into that

540
02:16:27,840 --> 02:16:33,000
in more detail in the presentation. And with that and you also have a little token, a little

541
02:16:33,000 --> 02:16:39,260
gold money bags. So please take them with you. Please use them wisely. It's a community money.

542
02:16:39,640 --> 02:16:44,920
So you should keep it somewhere and use them wisely. But with that alternative and we'll start

543
02:16:44,920 --> 02:16:48,160
with field, field, and Jim Fabian.

544
02:16:49,040 --> 02:16:50,200
Thank you, Lou's.

545
02:16:50,200 --> 02:16:55,980
Pleasure to be here tonight to be in front of the city council to talk about municipal bonds

546
02:16:55,980 --> 02:16:59,800
when I won Jim Fabian, the city's municipal advisor.

547
02:17:00,100 --> 02:17:06,640
I've had the pleasure of working with the city going back to the 2015 tax allocation refunding

548
02:17:06,640 --> 02:17:09,280
bonds and all the debt since that point in time.

549
02:17:09,280 --> 02:17:11,380
I'm also joined by my colleague,

550
02:17:11,640 --> 02:17:14,600
Andrew Reardon, in the audience there who helped

551
02:17:14,600 --> 02:17:17,920
and worked hard on the presentation in front of you tonight.

552
02:17:20,080 --> 02:17:24,160
And good evening, James Wersenniak, at Jones Hall.

553
02:17:24,920 --> 02:17:27,520
We are the Bond Council and Disclosure Council

554
02:17:27,520 --> 02:17:31,220
to the city have worked on the prior finances for the city

555
02:17:31,220 --> 02:17:34,280
and look forward to walking you through the presentation tonight.

556
02:17:36,320 --> 02:17:40,300
Great, so if we could move to slide number four, please.

557
02:17:41,640 --> 02:17:47,000
Okay. Well, I'm sorry. Let's stop here real quick. So in terms of our agenda tonight in front

558
02:17:47,000 --> 02:17:53,460
of you, we're going to be talking about an overview of debt in why cities issued debt. We're

559
02:17:53,460 --> 02:17:58,140
going to talk about the type of debt and the tax status of that debt. We're going to walk

560
02:17:58,140 --> 02:18:05,220
through the finance team involved in a debt issuance and the process. This is a great demonstration

561
02:18:05,220 --> 02:18:10,440
of what a bond issuance process looks like that we did for the fire station.

562
02:18:11,240 --> 02:18:16,400
We're also going to talk about the duties and responsibility of you as a city council member

563
02:18:16,400 --> 02:18:20,960
and then also touch upon the outstanding debt of the city of Milpetus.

564
02:18:22,060 --> 02:18:22,740
On the next slide,

565
02:18:25,040 --> 02:18:29,280
please. Again, we introduce ourselves. Please go to slide four.

566
02:18:30,620 --> 02:18:36,000
So, when we think about why I do public agencies use debt financing, really,

567
02:18:36,000 --> 02:18:43,140
When you think about it, it's to spread the costs of a project that usually has a useful

568
02:18:43,140 --> 02:18:48,660
life of 30 years or more over the years in which it serves the community.

569
02:18:49,620 --> 02:18:54,920
So, it's not just the current residents who pay that cost, but it's also the future residents

570
02:18:54,920 --> 02:18:56,940
of the community that pay for the cost.

571
02:18:57,460 --> 02:19:02,040
And the fire stations are a great example of that, where we spread the cost over a 20-year

572
02:19:02,040 --> 02:19:07,940
timeline, and so current and future users who benefit from that fire station being built

573
02:19:07,940 --> 02:19:10,140
also pay for the cost of that.

574
02:19:10,660 --> 02:19:17,100
Some of the purposes of why you issued debt are to acquire land, to construct a public

575
02:19:17,100 --> 02:19:23,540
building like the library, to construct utility infrastructure like you did for your water

576
02:19:23,540 --> 02:19:31,740
and sewer bonds that were issued, sometimes cities also issue debt for working capital for

577
02:19:31,740 --> 02:19:37,340
cash flow purposes, you haven't done that, and then also to refinance outstanding debt,

578
02:19:37,380 --> 02:19:40,000
which we'll talk about a little bit more in the future.

579
02:19:40,920 --> 02:19:42,900
So if you could go to the next slide, please.

580
02:19:47,350 --> 02:19:53,570
So when you look at what is a municipal bond, it's a security that is sold to the public

581
02:19:53,570 --> 02:19:54,690
capital markets.

582
02:19:55,230 --> 02:19:57,310
It's not to a single investor.

583
02:19:57,670 --> 02:20:00,390
It's to many potential investors.

584
02:20:01,210 --> 02:20:07,570
Typically, it's either a 20-year or 30-year repayment term, and you pay principle and

585
02:20:07,570 --> 02:20:11,530
interest over those 20 years or 30 years.

586
02:20:12,330 --> 02:20:17,070
You receive the money up front, so, like, for example, on the fire station, you receive

587
02:20:17,070 --> 02:20:22,230
the money to build the fire station, and then you repay the principle and interest over

588
02:20:22,230 --> 02:20:23,510
the next 20 years.

589
02:20:24,290 --> 02:20:28,350
Typically, you match the term of the debt for the useful life of the asset.

590
02:20:28,350 --> 02:20:37,850
And for larger projects, it's the lowest cost financing to the city because it's exempt from

591
02:20:38,970 --> 02:20:47,710
from taxes from both the federal and state level, so it's a very attractive way for people to invest their money and for you to borrow money.

592
02:20:50,030 --> 02:20:51,730
We're going to go to the next slide, please.

593
02:20:53,210 --> 02:20:59,530
Yeah, so Mr. Fabian just touched on this, the difference between tax exempt and taxable.

594
02:21:00,510 --> 02:21:08,190
So, in municipal finance, in most of what we do is tax exempt, finance, and that means the investor,

595
02:21:08,610 --> 02:21:13,590
that's loaning you the money upfront, they don't pay any taxes on the interest they receive.

596
02:21:14,270 --> 02:21:19,450
And because of that, they're willing to give you a lower interest rate, right, which saves the city money.

597
02:21:19,450 --> 02:21:26,310
So it's essentially a policy decision from the Congress that says, hey, we want to support local

598
02:21:26,310 --> 02:21:28,410
governments in building infrastructure.

599
02:21:29,030 --> 02:21:33,850
And because of that, you can see on the slide, there's some restrictions that go around

600
02:21:34,640 --> 02:21:41,010
tax exempt financing, namely public capital improvements, have to be financed, not salaries,

601
02:21:41,730 --> 02:21:45,850
operating budgets, but you build facilities with tax exempt bonds.

602
02:21:46,390 --> 02:21:51,090
Also, there's certain time limits on the spending of those bonds.

603
02:21:51,390 --> 02:21:57,830
Basically, the Congress, the IRS, they want you to take those tax exempt bonds and put the money to use right away.

604
02:21:58,250 --> 02:22:04,970
So that generally means for a new project, spend the money within three years and for a refunding project.

605
02:22:05,250 --> 02:22:09,450
So you've got some existing debt, you're going to refund for a lower rate of interest.

606
02:22:09,750 --> 02:22:13,810
You've got to do that within 90 days, don't just sit on the money from the new bonds,

607
02:22:13,810 --> 02:22:20,090
but pay off the old bonds. In contrast, a taxable borrowing sometimes makes sense for cities.

608
02:22:21,030 --> 02:22:25,950
There were some pension refunding bonds issued by some cities a few years back.

609
02:22:26,290 --> 02:22:29,970
There could be a situation where you can't spend money on a good capital price.

610
02:22:30,000 --> 02:22:46,160
Public within three years. So maybe we do that on a taxable basis. What that means, of course, is the investor is going to pay taxes on the interest. They're going to demand a higher interest rate. So it's not the most advantageous, but sometimes it makes sense for local communities. Next slide.

611
02:22:49,380 --> 02:23:02,540
Now on this slide, there's actually a lot of information on this slide folks can digest it. Members of the public can digest it afterward, but the crucial thing on this slide is showing the most

612
02:23:02,540 --> 02:23:09,440
different kinds of tax exempt municipal bonds. You have your general obligation bond. You have

613
02:23:09,440 --> 02:23:15,620
your tax increment bond. You're at least revenue bond. Your utility revenue bond. Your land

614
02:23:15,620 --> 02:23:22,140
secured bond. And as the name of each of those security says, what is the source of repayment?

615
02:23:22,400 --> 02:23:27,660
Is it coming from the utility system? Is it coming from a general obligation of the community?

616
02:23:27,660 --> 02:23:35,260
meaning an additional ad Valorum property tax and based on whatever source of repayment

617
02:23:35,260 --> 02:23:41,040
there is is a better or worse credit. So again, how much is the investor going to demand

618
02:23:41,040 --> 02:23:45,840
an interest rate depends on the quality of the credit and the various different types of

619
02:23:45,840 --> 02:23:47,660
bonds at different levels of credit.

620
02:23:50,390 --> 02:23:58,970
So if you could go to the next slide, please. So as James

621
02:23:58,970 --> 02:24:04,950
available to a city. General obligation bonds is the first one that we want to

622
02:24:04,950 --> 02:24:09,270
talk about in a little bit more detail. This is secured by unlimited

623
02:24:09,270 --> 02:24:16,930
Advalorum property tax. So it is the best form of credit that a city can have.

624
02:24:17,630 --> 02:24:24,690
It provides the strongest security and the lowest borrowing cost. It requires

625
02:24:24,690 --> 02:24:32,130
Although the citizens of the city to approve it at a 67% threshold, and typically it's

626
02:24:32,130 --> 02:24:38,970
for a specific project that it's been identified in a ballot with very specific language

627
02:24:38,970 --> 02:24:41,690
of what the money can be used for.

628
02:24:42,430 --> 02:24:46,970
Some of the advantages of a general obligation, I should mention the city does not have any

629
02:24:46,970 --> 02:24:52,910
general obligation bonds at the present time, but the advantages, as I mentioned, is the lower

630
02:24:52,910 --> 02:24:58,570
borrowing costs, no need for a debt service reserve fund, it's not paid repaid out the

631
02:24:58,570 --> 02:25:03,110
general fund, it's a new revenue source available to pay the debt service on the bonds.

632
02:25:04,130 --> 02:25:09,450
Some of the downside of this program is it takes a long lead time, so when you think about

633
02:25:09,450 --> 02:25:17,590
it, you have to go to the voter so you typically think about November elections, so it's

634
02:25:17,590 --> 02:25:22,270
pretty typical that you would say if you were planning to do a general obligation bond, it

635
02:25:22,270 --> 02:25:25,070
to be in November or 28 that you'd be looking for.

636
02:25:25,230 --> 02:25:28,670
So there's a long lead time associated with that.

637
02:25:28,730 --> 02:25:34,150
You also, as I mentioned, that 67th threshold has to be achieved

638
02:25:34,150 --> 02:25:35,790
to be able to get successfully.

639
02:25:36,270 --> 02:25:39,210
The ability to issue a general obligation bonds

640
02:25:39,210 --> 02:25:40,930
and you have very limited flexibility.

641
02:25:40,930 --> 02:25:44,490
It has to be used for the identified project

642
02:25:44,490 --> 02:25:46,530
that was put into the ballot language.

643
02:25:46,910 --> 02:25:49,750
And I might just add that you all might be familiar

644
02:25:49,750 --> 02:25:52,770
with general obligation bonds with the local school district.

645
02:25:53,270 --> 02:25:55,630
So the school districts are a much more frequent

646
02:25:55,630 --> 02:25:58,990
issuers of general obligation bonds in California.

647
02:26:00,490 --> 02:26:03,750
Partly, folks, voters like to support construction

648
02:26:03,750 --> 02:26:05,470
of new schools and school facilities.

649
02:26:05,770 --> 02:26:09,710
And partly, the schools only need to get 55% voter approval.

650
02:26:10,130 --> 02:26:13,030
So the city of Milpitas needs two thirds, 66,

651
02:26:13,910 --> 02:26:16,490
but the school district only needs 55%.

652
02:26:16,490 --> 02:26:18,950
And so for that reason, there are a lot more

653
02:26:18,950 --> 02:26:24,190
school district general obligation bonds in the state very few city general obligation bonds.

654
02:26:26,630 --> 02:26:32,070
If you could go to the next slide please. So the next tool or type of debt is tax

655
02:26:32,070 --> 02:26:39,590
or increment financing or tax allocation bonds. This is when you think about like what we used to

656
02:26:39,590 --> 02:26:46,410
be able to do with a redevelopment agency, you would issue bonds based upon the tax increment generated

657
02:26:46,410 --> 02:26:55,250
from a project area that went away back in 2012, but you can now do refundings of the existing

658
02:26:55,250 --> 02:27:02,350
debt. For example, your 2015 tax allocation refunding bonds are coming up for the ability

659
02:27:02,350 --> 02:27:08,770
to be called to save money and loose admission that will be coming back and talking about that

660
02:27:08,770 --> 02:27:15,930
on September 1st. This is not a general fund obligation. It's solely repaid by tax increment

661
02:27:15,930 --> 02:27:24,690
that's repaid through the rocks process through the county. It has a ability to be refinances.

662
02:27:24,910 --> 02:27:30,610
I mentioned to lower debt service costs which provides residual property taxes to other

663
02:27:30,610 --> 02:27:37,450
taxing entities, including the city. Again, it's not a general fund obligation. It's paid solely

664
02:27:37,450 --> 02:27:43,590
from the pledge tax increment within the project area. Some things to consider when you're looking

665
02:27:43,590 --> 02:28:01,450
tax increment or tax allocation refunding bonds is the value of the project area, the value of the project area is really an important factor in the credit assessment that a rating agencies do.

666
02:28:01,450 --> 02:28:04,590
Your project areas are in great shape.

667
02:28:04,750 --> 02:28:10,050
You have had enormous growth in your assess value over the last 10 years.

668
02:28:10,570 --> 02:28:16,050
You have some really great property owners within the project area as well.

669
02:28:16,210 --> 02:28:22,730
It does require you to go to the county oversight board for approval after a success or agency approval.

670
02:28:23,590 --> 02:28:27,530
And then to the Department of Finance to get their approval over refunding.

671
02:28:27,530 --> 02:28:37,510
It is a little bit weaker credit because it is a specific to a specific project area and the value of that project area.

672
02:28:38,070 --> 02:28:48,550
And then as I mentioned since 2012, unless you're San Francisco or I think it's the city of Marina or the only two cities that can do new tax allocation refunding bonds.

673
02:28:48,770 --> 02:28:52,470
All other cities within the state can only do refundings.

674
02:28:55,100 --> 02:29:02,760
Council members, this is your meeting, this is your study session, so if there's anywhere that you want to pause or ask a question,

675
02:29:03,240 --> 02:29:09,260
recently open to it, and you will also be getting for me in the next day or so.

676
02:29:09,840 --> 02:29:19,020
Effectively a memorandum, and I'm sorry to inflict those on you, but I want to give you a history of what we development agencies are, how they started in the state of California,

677
02:29:19,020 --> 02:29:25,400
how specifically the City of Nopetus as a redevelopment agency, how it was dissolved and

678
02:29:25,400 --> 02:29:31,560
and many, much other information about that, including the fact that our, what a tax

679
02:29:31,560 --> 02:29:41,420
requirement is for example. And so I think back in 2014 or 2012, 2014, the value of our property

680
02:29:41,420 --> 02:29:48,120
was 800 million or something like that, and that's 11.8 million. Is that roughly right?

681
02:29:48,120 --> 02:29:53,240
when the when the project area was originally was 1976. I think actually when the project

682
02:29:53,240 --> 02:29:59,980
area was actually formed and it was 800 million and now it's 11 billion. Yeah, right. So so

683
02:30:00,000 --> 02:30:06,860
Our property values have increased, which means that the taxes from those property values come to us.

684
02:30:06,860 --> 02:30:15,600
And we get 16.3 cents of that doubt is the best way to explain it. But I'll let Jim go on, keep going on.

685
02:30:15,680 --> 02:30:26,000
The police feel free to stop. The memorandum will be very helpful to you and giving you much more information that you can also spend some time to look at.

686
02:30:26,000 --> 02:30:30,060
And we vice mayor, we have a question.

687
02:30:33,410 --> 02:30:34,650
And that at this time.

688
02:30:34,870 --> 02:30:35,230
Me.

689
02:30:35,770 --> 02:30:36,010
Also.

690
02:30:39,110 --> 02:30:40,390
Thank you.

691
02:30:40,450 --> 02:30:42,070
Yes, come to me when we lean. Sorry.

692
02:30:42,430 --> 02:30:43,170
Thank you.

693
02:30:43,450 --> 02:30:50,490
So I just heard that you say school districts get a 55% passing rate, right?

694
02:30:51,770 --> 02:30:53,310
A voter approval threshold.

695
02:30:53,650 --> 02:30:56,550
Yeah, it's a little lower threshold for their general obligation bonds.

696
02:30:56,550 --> 02:30:59,690
And for the city is 67% that's right.

697
02:31:00,170 --> 02:31:01,490
Do you know why?

698
02:31:02,070 --> 02:31:04,490
That is enshrined in the California Constitution.

699
02:31:05,530 --> 02:31:09,670
So the 66% goes back to Prop 13, 1978, you know,

700
02:31:09,770 --> 02:31:13,710
when the 1% ad Valorum was established by Prop 13,

701
02:31:13,750 --> 02:31:17,410
there is very few exceptions to that 1%

702
02:31:17,410 --> 02:31:20,930
and one of those exceptions is two thirds of our approval

703
02:31:20,930 --> 02:31:22,670
of a general obligation bond.

704
02:31:22,670 --> 02:31:30,370
fast forward to about 20 years ago and the Constitution was further amended to allow school

705
02:31:30,370 --> 02:31:37,910
districts to get their general obligation bonds approved by 55%. So they had special legislation

706
02:31:37,910 --> 02:31:43,570
approved up again the voters of the state approved school districts but no other local agencies

707
02:31:43,570 --> 02:31:49,710
so cities, water districts, sewer districts, counties, you know everyone else still requires

708
02:31:49,710 --> 02:31:57,630
the 23rds, the 67%, you might recall back, I think it was in November 2024, there was a measure

709
02:31:57,630 --> 02:32:04,550
on the ballot to lower the threshold for cities and other governmental agencies and it failed.

710
02:32:06,130 --> 02:32:13,030
So until it gets resurrected and tried again, we'll be at that 67% threshold.

711
02:32:13,730 --> 02:32:15,450
Thank you. Sure.

712
02:32:17,530 --> 02:32:20,550
Okay, once the one moving on, if you could go to the next slide, please.

713
02:32:21,910 --> 02:32:29,390
So, we talked about general obligation bonds, tax increment bonds, the next tool is

714
02:32:29,390 --> 02:32:35,690
least revenue bonds, also sometimes referred to as certificates of participation, they're

715
02:32:35,690 --> 02:32:42,010
the same thing, but a little different approach to how they're issued and secured.

716
02:32:42,870 --> 02:32:48,890
Your fire station, for example, the financing we did was a least revenue bond, it's secured

717
02:32:48,890 --> 02:32:56,530
by lease payments between the city and your financing authority, that city leases that asset

718
02:32:56,530 --> 02:33:01,910
to the authority, which then leases it back to the city, the lease payments that are used

719
02:33:01,910 --> 02:33:06,790
to pay the bondholders over that 20-year timeframe for the principal and interest payment.

720
02:33:07,650 --> 02:33:12,930
There is a general fund obligation, and so there wasn't not a new revenue created, but

721
02:33:12,930 --> 02:33:19,470
existing revenues in the general fund pay the debt service on that particular, at least revenue

722
02:33:19,470 --> 02:33:28,170
bond issue, and it is subject to abatement. So, if for whatever reason you could not have access

723
02:33:28,170 --> 02:33:36,070
and use of that building, you wouldn't be obligated to pay debt service on it. It's abated at that

724
02:33:36,070 --> 02:33:42,510
point in time. If there was some reason why, like, say, for example, an earthquake in the building

725
02:33:42,510 --> 02:33:46,150
collapsed or something like that. That would be a situation where a

726
02:33:46,150 --> 02:33:51,810
abatement would kick in. The advantages of least revenue bonds or certificates

727
02:33:51,810 --> 02:33:56,650
are participation. It's you the council that votes to approve it. So it's just a

728
02:33:56,650 --> 02:34:01,310
majority vote of the city council to approve the issuance of this type of

729
02:34:01,310 --> 02:34:08,110
debt. It's very flexible in terms of the structure. It's widely used by California

730
02:34:08,110 --> 02:34:16,430
cities up and down the state to find it for structure. It is an obligation of the general fund

731
02:34:16,430 --> 02:34:24,630
and it does encumber an essential city asset. So you have to secure the repayment by having

732
02:34:24,630 --> 02:34:30,650
property insurance against that and encumbering the asset. And as I mentioned, the abatement

733
02:34:30,650 --> 02:34:37,930
risk that is mitigated also because you pay for rental and eruption insurance. But again, if you can't

734
02:34:37,930 --> 02:34:41,090
use the building, you can't pay that service on it.

735
02:34:43,520 --> 02:34:48,240
So on the next slide, wanted to talk about the structure, and I'm going to turn it over

736
02:34:48,240 --> 02:34:48,700
to James.

737
02:34:49,420 --> 02:34:53,800
Yeah, so this one, we get into the weeds here a little bit on the legal structure, because

738
02:34:53,800 --> 02:34:58,800
you might be asking, well, why do we need a lease, you know, we're just trying to issue a bond,

739
02:34:59,000 --> 02:35:03,920
we're trying to raise money if we do a tax increment financing, we can just issue a bond.

740
02:35:04,160 --> 02:35:07,360
If we do a general obligation bond financing, we issue a bond.

741
02:35:07,360 --> 02:35:14,600
But for the general fund, again, we're talking about general fund, supported financing here.

742
02:35:14,700 --> 02:35:22,360
We need to use the lease back structure because again, the California Constitution requires us to do so.

743
02:35:22,680 --> 02:35:29,380
The city, as you know, is not able to put a debt on the general fund that lasts longer than a year.

744
02:35:29,560 --> 02:35:36,700
In other words, you have to budget and appropriate each year amounts that are available to the city council in that year.

745
02:35:36,700 --> 02:35:57,100
In this goes back to the foundation of the California as a state, when city councils, local school districts might say, hey, we want to build a big project and we're going to issue a debt and let the future citizens, let the future taxpayers bear the burden of that.

746
02:35:57,100 --> 02:36:00,200
Well, California Constitution says, no, you can't do that.

747
02:36:00,460 --> 02:36:03,120
Just spend your money this year that you have this year,

748
02:36:03,580 --> 02:36:05,660
and you can't encumber the future generations

749
02:36:05,660 --> 02:36:08,480
with a long-term debt on the general fund.

750
02:36:08,700 --> 02:36:10,760
Again, if you're in the utility fund,

751
02:36:11,060 --> 02:36:12,500
the utility is paying for that.

752
02:36:12,500 --> 02:36:14,600
If you're in the tax increment world,

753
02:36:14,600 --> 02:36:16,900
the tax increment is paying for that, that's OK.

754
02:36:17,260 --> 02:36:19,120
But when we're in the general fund world,

755
02:36:19,660 --> 02:36:22,300
you have to only spend what you have available that year.

756
02:36:22,940 --> 02:36:25,540
And so the way we are able to legally

757
02:36:25,540 --> 02:36:30,680
issue of general fund obligation is through the lease because those lease payments are due and

758
02:36:30,680 --> 02:36:36,420
payable each year. As Mr. Fabian just described, if you don't have use and occupancy of the asset,

759
02:36:36,700 --> 02:36:41,480
you the city don't pay the lease payment. So it's what we call a contingent obligation.

760
02:36:42,760 --> 02:36:48,220
It's only payable if you have use and occupancy and that puts us within the constitutional

761
02:36:48,220 --> 02:36:51,600
debt limitation permissible uses.

762
02:36:52,600 --> 02:36:55,740
And so this slide again just goes into more of that detail.

763
02:36:56,280 --> 02:37:01,300
The city will take a essential assets such as City Hall, such as a fire station,

764
02:37:01,580 --> 02:37:06,400
leases it to the financing authority, the members of whom are you as well as the city council,

765
02:37:06,600 --> 02:37:08,040
the members of the financing authority.

766
02:37:08,760 --> 02:37:12,040
So it's all in-house financing authority leases it back to the city.

767
02:37:12,360 --> 02:37:18,040
That generates that lease payment stream that is permissible under the constitution when

768
02:37:18,040 --> 02:37:22,400
given to the trustee, trustee tanks it and hands it over to the investors who have again

769
02:37:22,400 --> 02:37:26,100
given you the money up front and then they get their debt service over time.

770
02:37:38,840 --> 02:37:43,280
Thank you. I don't know if this is appropriate to ask, but I will ask it anyway.

771
02:37:45,440 --> 02:37:56,140
So, you said if earthquake collapse, whatever, then we don't have to pay. What if the city has a deficit?

772
02:37:58,240 --> 02:38:02,820
So he has a deficit, you still have to pay, because you have use and occupancy of that building

773
02:38:02,820 --> 02:38:04,840
and so you're paying the lease payment.

774
02:38:05,320 --> 02:38:07,580
What if we cannot come up with a money to pay?

775
02:38:10,680 --> 02:38:15,360
It is an obligation to pay the lease payment, just like every other obligation you have to

776
02:38:15,360 --> 02:38:18,640
pay salaries and pay the heating bill and all that.

777
02:38:18,780 --> 02:38:23,720
It's co-equal with all those other obligations, you know, again, no different than any others.

778
02:38:25,380 --> 02:38:28,310
Thank you.

779
02:38:28,390 --> 02:38:28,590
Yes.

780
02:38:33,200 --> 02:38:33,780
I'd recommend.

781
02:38:34,160 --> 02:38:34,620
Thank you.

782
02:38:34,720 --> 02:38:34,820
Why?

783
02:38:36,120 --> 02:38:39,180
Just following up with that question.

784
02:38:39,820 --> 02:38:46,380
What's the priority of this paying the debt?

785
02:38:46,900 --> 02:38:48,820
High-quality and paying salary?

786
02:38:51,460 --> 02:38:52,420
So, how do you prioritize?

787
02:38:54,140 --> 02:38:55,860
I mean, again, legally, it's all equal.

788
02:38:55,860 --> 02:39:03,500
You know, it's all these are do each year in which you have the obligation to be do legally that that there's no difference

789
02:39:06,980 --> 02:39:11,240
Council if we if we got into that situation which we'd be extraordinary

790
02:39:11,240 --> 02:39:18,940
We would have to we wouldn't have to have some sort of overall plan for all of our expenses and this would be one of them one of them

791
02:39:18,940 --> 02:39:24,900
Which was important to pay it's still it would have to be included in overall plan to to solve whatever a challenges

792
02:39:24,900 --> 02:39:29,300
of put the city in that situation. Obviously I don't think that situation is going to happen

793
02:39:29,300 --> 02:39:33,400
anytime soon with the city of Mopitas. Again, we have sufficient reserves.

794
02:39:35,040 --> 02:39:37,280
Yeah, not as scary as you think.

795
02:39:37,280 --> 02:39:40,300
Nope, thank you, thank you, thank you so much for the question.

796
02:39:41,780 --> 02:39:52,160
Yeah. Right, in addition to the question, do we, if ACT has a deficit or projected one?

797
02:39:54,460 --> 02:40:03,360
And is it ordinary that we resort to this kind of a band, the least revenue bands or because of that

798
02:40:03,360 --> 02:40:07,160
based on some other factors like credit rating or whatnot?

799
02:40:08,720 --> 02:40:12,040
We do not opt for kind of a band.

800
02:40:13,000 --> 02:40:19,340
Yeah, the way I would think about that question is that when you think about issuance of a least revenue bond,

801
02:40:19,340 --> 02:40:23,240
You're really not, you're not doing it to pay bills.

802
02:40:23,680 --> 02:40:26,340
You're using it to build a facility.

803
02:40:27,580 --> 02:40:32,920
And so that decision to build a facility

804
02:40:32,920 --> 02:40:35,460
through your capital improvement program

805
02:40:35,460 --> 02:40:38,700
is something that's needed and is a priority.

806
02:40:39,980 --> 02:40:43,640
And the least revenue bonds is a mechanism to pay for it.

807
02:40:44,460 --> 02:40:46,740
Over a 20 or 30 year timeframe

808
02:40:46,740 --> 02:40:48,660
so that you would then have the ability

809
02:40:48,660 --> 02:40:54,580
to stretch that payment out over current residents and future residents would it be usually after

810
02:40:54,580 --> 02:41:01,160
construction that the the term of the payment starts or right after the issuance of the

811
02:41:01,160 --> 02:41:06,240
fund typically six months after the issuance so that the bond yes okay

812
02:41:09,730 --> 02:41:11,190
all right thank you

813
02:41:11,190 --> 02:41:16,110
yeah and I actually think that the questions from the council are spot on and it highlights what

814
02:41:16,110 --> 02:41:21,130
Mr. Fabian said at the very beginning in order to build that fire station that's going to cost

815
02:41:21,130 --> 02:41:26,190
to $30 million, you're not going to be able to afford it in one year.

816
02:41:26,490 --> 02:41:29,950
You can't write that $30 million check in one year, because you have salaries.

817
02:41:30,150 --> 02:41:32,010
You have per's pension obligations.

818
02:41:32,890 --> 02:41:37,710
But if you spread it out over 20 or 30 years, then you're just paying a million dollars

819
02:41:37,710 --> 02:41:38,310
a year.

820
02:41:38,530 --> 02:41:40,350
And that is maybe more affordable.

821
02:41:40,890 --> 02:41:43,530
And again, the useful life of that asset is going to be there.

822
02:41:43,690 --> 02:41:46,950
So I think that's what's kind of highlighted by those questions.

823
02:41:46,950 --> 02:41:52,110
You can't afford to pay that much money in one year so you spread it out.

824
02:41:52,930 --> 02:41:58,570
One other point to make is that when you're spreading that debt, the people who are in

825
02:41:58,570 --> 02:42:01,110
let's say, let's make an assumption that it's for 30 years.

826
02:42:01,730 --> 02:42:07,670
The people who are paying taxes for those 30 years are enjoying the benefits of that particular asset.

827
02:42:08,150 --> 02:42:15,370
So we built station number two, a few years ago, and people are now, we are now using station number two.

828
02:42:15,370 --> 02:42:21,530
So folks who have been using that station have the benefits of folks that are of our employees

829
02:42:21,530 --> 02:42:27,070
or public safety staff that serve the community from that station are enjoying the benefits.

830
02:42:27,810 --> 02:42:34,010
So if you want to talk about equity, it is fair for those persons who are enjoying the benefit

831
02:42:34,010 --> 02:42:38,150
of that asset to also contribute to its constructions.

832
02:42:40,740 --> 02:42:41,520
Okay, great.

833
02:42:41,740 --> 02:42:43,380
If we could go to the next slide, please.

834
02:42:44,760 --> 02:42:50,700
So, this financing tool is water and sewer revenue bonds.

835
02:42:51,200 --> 02:42:57,960
You have used this in the past for improvements to your sewer conveyance system,

836
02:42:58,340 --> 02:43:03,320
and then also for your contribution to the San Jose sewer plant,

837
02:43:03,860 --> 02:43:08,660
also for water system improvements within the city as well.

838
02:43:09,080 --> 02:43:11,940
And this type of debt is secured by the repayment

839
02:43:11,940 --> 02:43:18,440
the utilities net revenues, and so when you think about your water, your sewer system, you have

840
02:43:18,440 --> 02:43:24,340
your rates and charges that are paid by the residents and businesses, those are your gross revenues.

841
02:43:25,260 --> 02:43:31,180
You subtract the maintenance and operational expenses of those utilities and then you're left with

842
02:43:31,180 --> 02:43:38,060
your net revenues that are used to pay the debt service on outstanding bonds. This is not a general

843
02:43:38,060 --> 02:43:43,880
fund debt, it does an impact the capacity of the general fund to pay for other services,

844
02:43:44,760 --> 02:43:51,280
a prop to a team process is required to adopt the rates for both your water and sewer system.

845
02:43:51,980 --> 02:43:59,060
It is a stronger credit because it's self-supporting and, you know, you have to drink water

846
02:43:59,060 --> 02:44:05,340
and you have to flush the toilet. You know, so it's something that's an essential utility credit

847
02:44:05,340 --> 02:44:09,680
and the bond market likes those type of credits.

848
02:44:10,500 --> 02:44:15,120
As I mentioned, you have two outstanding sewer revenue bonds and one water bond issue.

849
02:44:16,220 --> 02:44:20,900
From an investor's perspective, for every dollar or debt service you pay,

850
02:44:21,140 --> 02:44:24,300
you have to collect a dollar 15 of revenues.

851
02:44:24,540 --> 02:44:29,360
So you have a 1.15 x coverage factor.

852
02:44:30,040 --> 02:44:34,440
And again, that just helps secure the credit provides a buffer

853
02:44:35,220 --> 02:44:40,440
for the potential bond holders to make sure that they're going to get their debt service

854
02:44:40,440 --> 02:44:46,280
paid each year. And then typically you have in these type of credits additional bonds test

855
02:44:46,280 --> 02:44:53,440
that are you have to meet to be able to issue more debt or either the water or the sewer system

856
02:44:53,440 --> 02:44:54,260
in the future.

857
02:44:55,560 --> 02:44:59,980
Yeah, I mean, for example, the coverage part is interesting. For example, when we went through

858
02:45:00,000 --> 02:45:06,160
The most recent drought a few years back, people were encouraged to conserve water, and they did.

859
02:45:06,320 --> 02:45:10,960
But that meant the revenues available to the water system, the city Melpedus went down.

860
02:45:11,520 --> 02:45:16,980
So, you know, you have to adjust your rates, meanwhile your costs are usually about the same.

861
02:45:17,280 --> 02:45:21,600
So, you have that little coverage factor in there to assure the investors they'll get repaid.

862
02:45:23,790 --> 02:45:30,290
As a reminder, we are starting the process of rates studies for our water and sewer services,

863
02:45:30,290 --> 02:45:36,550
that's going to kick off later this year. That's roughly a two year process because it requires

864
02:45:36,550 --> 02:45:41,510
a lot of outreach because effectively we're reaching out, we're evaluating what our finances

865
02:45:41,510 --> 02:45:47,690
will need to be to support the systems for the subsequent five years because our rates and

866
02:45:47,690 --> 02:45:53,710
sewer rates could study every five years. So this is in collaboration with the finance and public

867
02:45:53,710 --> 02:45:59,630
works that will be doing that work and the supposition is as we have to have those rates in place

868
02:45:59,630 --> 02:46:07,370
by 2020, July 1st, 2020, so we have some work in front of us and so what you will see

869
02:46:07,370 --> 02:46:12,850
as part of that right study is the amount of debt that there will be part of the rates

870
02:46:12,850 --> 02:46:18,070
has to cover this outstanding debt, so that'll be part of the rates, so that'll be coming to

871
02:46:18,070 --> 02:46:23,890
you in about a year. The first of you.

872
02:46:26,070 --> 02:46:27,930
Okay, could you please go to the next slide?

873
02:46:27,930 --> 02:46:34,750
So, the last financing tool, our land secure bonds, and these are typically either community

874
02:46:34,750 --> 02:46:41,990
facility districts commonly known as CFDs or assessment districts commonly known as ADs,

875
02:46:42,550 --> 02:46:48,390
they're secured by either special taxes for a community facilities district or assessments

876
02:46:48,390 --> 02:46:55,290
for an assessment district. They're approved by the property owners or voters within the boundaries

877
02:46:55,290 --> 02:47:02,450
of either of these districts. They're typically used to fund infrastructure, like streets,

878
02:47:03,170 --> 02:47:11,370
sewer, storm drain. It's not an obligation of the city. Again, some of the vanishes of this

879
02:47:11,370 --> 02:47:16,270
type of debt is it's not a general fund obligation. So it has no impact on your general fund.

880
02:47:16,490 --> 02:47:24,010
It can be tailored to the specifics of the project and phased over time. It because it's a vote

881
02:47:24,010 --> 02:47:31,110
of specific people residing or owning property within the boundaries, it's a little bit

882
02:47:31,110 --> 02:47:37,510
easier to get accomplished than the geo-bond process where you need 67% of all voters.

883
02:47:38,470 --> 02:47:44,970
It does allow you to the repayment is dependent upon the value of the property within the boundaries

884
02:47:44,970 --> 02:47:51,250
of the district. They are a little bit complicated to set up. There's a process involved with

885
02:47:51,250 --> 02:47:57,070
forming either a community facilities district or an assessment district, it does require

886
02:47:57,070 --> 02:48:01,430
either approval of the property owners or the residents that live within the boundaries.

887
02:48:02,470 --> 02:48:09,570
There's a real specific strict, strict nexus between the benefit received from an assessment

888
02:48:10,430 --> 02:48:15,070
to the property owners that has to be met, a high legal standard that is required.

889
02:48:15,710 --> 02:48:20,570
And then it does require either the land owner or the registered voters within the district

890
02:48:20,570 --> 02:48:27,790
to approve it. So this is typically done in new development areas where you potentially have like

891
02:48:27,790 --> 02:48:36,490
a raw piece of land where a prop donor wants to do a development. They need community facilities,

892
02:48:36,790 --> 02:48:43,790
district or an assessment district to help fund the upfront infrastructure for land that has no

893
02:48:43,790 --> 02:48:49,390
infrastructure at that point in time and so they would come to the city and ask for one of these

894
02:48:49,390 --> 02:48:57,050
districts to be set up. As far as I know, there are no CFDs or assessment districts, wouldn't

895
02:48:57,050 --> 02:49:03,570
the city for bonded debt. Yeah, for you have, have them for specific needs like landscape

896
02:49:03,570 --> 02:49:04,510
and lighting.

897
02:49:06,780 --> 02:49:09,460
But there's no, but there is no debt related to those districts.

898
02:49:11,590 --> 02:49:12,290
Okay, if you

899
02:49:12,290 --> 02:49:17,210
could go to the next slide, please, I wanted to do a snapshot of your existing outstanding

900
02:49:17,210 --> 02:49:24,090
debt. It's just walked through starting at the top. We talked about the fire station previously.

901
02:49:24,290 --> 02:49:30,190
This is a general fund debt, at least revenue bonds. I'm proud to say it has a double A plus

902
02:49:30,190 --> 02:49:40,510
rating by S&P. It is matures in 2041, June 1st of 2041. So it was a 20-year bond that we did

903
02:49:40,510 --> 02:49:44,650
and it has roughly $16 million outstanding now.

904
02:49:44,870 --> 02:49:51,090
And then it's redeemable on June 1st, 2020 at a hundred percent.

905
02:49:51,270 --> 02:49:54,350
That's the first call date where the bonds could be refunded.

906
02:49:55,570 --> 02:50:01,510
Then going into the utility systems water system first,

907
02:50:01,770 --> 02:50:06,010
the series 2019 bonds, again, double A plus Reddit rating,

908
02:50:06,010 --> 02:50:10,410
reflecting the good strong credit fundamentals of Milpetus.

909
02:50:10,970 --> 02:50:14,050
Those bonds were done for a 30 year time frame.

910
02:50:14,410 --> 02:50:17,230
We have roughly 15 million left of those.

911
02:50:17,230 --> 02:50:21,150
Those are coming up for their first call date on June 1,

912
02:50:21,150 --> 02:50:25,010
2021, on the sewer system side.

913
02:50:25,550 --> 02:50:29,530
You have some bonds coming up for being paid off

914
02:50:29,530 --> 02:50:33,190
on November 1, 2026, those are the 2017 bonds.

915
02:50:33,250 --> 02:50:34,350
So those will go away.

916
02:50:34,350 --> 02:50:38,990
And then you'll be able to have the Series 2019 bonds.

917
02:50:39,290 --> 02:50:42,930
Again, rate of double A plus, a 30 year bonds.

918
02:50:43,190 --> 02:50:46,770
You have roughly 27 million outstanding on those.

919
02:50:47,070 --> 02:50:50,350
And those are callable on November 1, 2021.

920
02:50:51,390 --> 02:50:56,090
And then the last debt that you have are your tax increment bonds,

921
02:50:56,290 --> 02:51:01,770
the Series 2015 bonds, those mature on September 1,

922
02:51:01,770 --> 02:51:06,950
of 2032, those are rated double A by standard of pours.

923
02:51:06,970 --> 02:51:09,990
There's roughly $47 million of bonds left.

924
02:51:10,550 --> 02:51:12,150
Those are now callable.

925
02:51:12,910 --> 02:51:16,290
And as loose mentioned, we'll be talking about refunding

926
02:51:16,290 --> 02:51:21,830
those bonds on September 1st to provide lower debt

927
02:51:21,830 --> 02:51:23,770
service and keep money on Main Street

928
02:51:23,770 --> 02:51:25,410
and not going back to Wall Street.

929
02:51:25,950 --> 02:51:28,670
So that's a snapshot of your outstanding debt

930
02:51:28,670 --> 02:51:31,050
as of July 16th of this year.

931
02:51:35,080 --> 02:51:36,500
That's right.

932
02:51:38,500 --> 02:51:39,480
What do you want to remember then?

933
02:51:42,300 --> 02:51:47,600
My question is related to the buyer.

934
02:51:48,300 --> 02:51:55,980
If I'm the buyer, I'm looking at 3-year bank, wouldn't it be a long time?

935
02:51:57,240 --> 02:52:07,510
Would the bank or the security, what do you call those?

936
02:52:07,550 --> 02:52:08,650
When you buy stocks?

937
02:52:09,810 --> 02:52:20,810
Well, they, we package it in a different form, so the buyer would not have to wait that long for the bond.

938
02:52:21,450 --> 02:52:28,250
Well, look at it this way, so in investor of your bonds, they have a decision to make.

939
02:52:28,810 --> 02:52:29,970
So a 30 year bond.

940
02:52:30,000 --> 02:52:53,580
As 30 different maturities. So, like for example, the sewer bonds, they were issued in 2019. So, there's a 2019, 2020, 2020, 2020, 2020, 2020, 2049 security. So, an individual investor decides, well, what what maturity works for my investment portfolio?

941
02:52:53,580 --> 02:52:59,000
So is it short, short end of the yokeur, middle of the yokeur over the long end of the

942
02:52:59,000 --> 02:52:59,300
yokeur?

943
02:52:59,460 --> 02:53:06,320
So that's an individual decision that an investor makes, whether it's a bond fund or a person

944
02:53:06,320 --> 02:53:16,580
who buys bonds to you, you put out your bonds for that 30 or time frame and allow investors

945
02:53:16,580 --> 02:53:20,820
to decide which maturities they buy and which they don't buy.

946
02:53:20,820 --> 02:53:30,720
bonds are sold all the time back and forth on the secondary market. So it's probably very unlikely that somebody's going to hold a bond for 30 years.

947
02:53:31,080 --> 02:53:40,780
Just because of their individual circumstances or the funds circumstances as rates go up, go down, recessions, you know, boom times.

948
02:53:41,560 --> 02:53:49,300
So it's the secondary market is very active in bonds and it's very typical that somebody doesn't hold it till maturity.

949
02:53:49,300 --> 02:53:56,160
book council member. You're also correct that whoever is buying that 30 year maturity, they're

950
02:53:56,160 --> 02:54:00,600
going to get a higher interest rate than who's buying the the two year maturity, right?

951
02:54:00,720 --> 02:54:06,160
Because there's more risk that the city of Melpedus may not pay in 30 years versus in two years

952
02:54:06,160 --> 02:54:12,180
or any local agency. And so as Mr. Fabian described, because we have a different bond

953
02:54:12,180 --> 02:54:18,680
maturing every year, we don't pay the high interest rate, the 30 year high interest rate on all the

954
02:54:18,680 --> 02:54:23,040
We pay a lower interest rate shorter down the yield curve.

955
02:54:23,180 --> 02:54:26,480
We only pay the higher interest rate on that final couple of

956
02:54:26,480 --> 02:54:28,900
maturitys if that makes sense.

957
02:54:28,900 --> 02:54:30,220
Yeah, that would make perfect sense.

958
02:54:30,620 --> 02:54:33,800
And we do have an example that we're going to walk through to

959
02:54:33,800 --> 02:54:35,340
demonstrate that for you.

960
02:54:35,680 --> 02:54:40,740
So it would be hopefully a little clearer on a hypothetical bond.

961
02:54:41,720 --> 02:54:42,400
Okay, thank you.

962
02:54:43,440 --> 02:54:45,680
Sure, if you go to the next slide, please,

963
02:54:48,940 --> 02:54:49,100
okay.

964
02:54:49,100 --> 02:55:18,100
So in the bond world, they say it takes a village to issue a bond, and these are, this is the members of the village, you're the issueer, you know, you're in control, it's your bond, you're debt, we work all work for you, James, as I mentioned as the bond council, his firm Jones Hall, they also, in most cases like for you, they have also,

965
02:55:18,100 --> 02:55:21,220
or two hats, bond council and disclosure council.

966
02:55:21,520 --> 02:55:23,660
So not only do they pair the legal documents,

967
02:55:23,860 --> 02:55:25,900
provide the tax example, legal opinion,

968
02:55:26,480 --> 02:55:29,540
but they also provide the disclosure documents.

969
02:55:30,240 --> 02:55:33,860
So that investor can decide whether or not to buy your bond.

970
02:55:35,100 --> 02:55:36,900
We are your municipal advisor.

971
02:55:37,380 --> 02:55:41,180
We have a fiduciary duty to protect your financial interest

972
02:55:41,740 --> 02:55:44,860
and to advise on structure, time and pricing.

973
02:55:45,580 --> 02:55:51,920
We have an underwriter who actually buys your bonds from you and then resells them to the public.

974
02:55:52,940 --> 02:56:00,860
We have a rating agency. In your case, we have used Standard and Poor's to provide an independent credit rating

975
02:56:00,860 --> 02:56:04,600
of the city's financial situation and bonds.

976
02:56:05,100 --> 02:56:12,260
We have a trustee. A trustee's job is to take the money from the city to pay the bond holders

977
02:56:12,260 --> 02:56:23,140
on either a semi-annual basis of principle and interest and then a minister or any other funds that are involved with the bond issuance.

978
02:56:23,360 --> 02:56:33,640
And sometimes we have a bond insure, build American mutual or a sure guarantee that provide bond insurance their rated AA.

979
02:56:33,640 --> 02:56:44,440
That's not something you have because of your outstanding credit rating, so you don't have any bond insurance now on any of your bonds.

980
02:56:45,340 --> 02:56:53,920
And so additional members on the issuer side of our team, because it's not just financial though finances is the leader very much in bonding.

981
02:56:53,920 --> 02:57:02,000
The City Attorney's responsibility is to review the documents and of course to speak a little bit to that.

982
02:57:02,200 --> 02:57:04,560
Of our City Attorney wants to speak to that, he certainly can.

983
02:57:05,100 --> 02:57:09,180
And we also collaborate with whoever department has an asset, for example,

984
02:57:09,420 --> 02:57:16,240
let's say that we were thinking about building a two-story sports center to replace our sports center.

985
02:57:16,240 --> 02:57:22,420
So, Renee would be in the director of recreation would be involved in understanding what the

986
02:57:22,420 --> 02:57:27,520
knees are and what that would look like planning would be involved to figure out how we

987
02:57:27,520 --> 02:57:32,620
would be able to plan it, a building that would work in our community, public works would

988
02:57:32,620 --> 02:57:37,380
be involved, not just looking at picing out the answer and looking at how much it is, but also

989
02:57:37,380 --> 02:57:41,860
what are the operating maintenance costs that we're not looking at the cost of the debt,

990
02:57:42,140 --> 02:57:43,720
but we're also looking down the road.

991
02:57:43,720 --> 02:57:46,600
And so it's not, it's a very,

992
02:57:46,980 --> 02:57:58,960
bonding is a complex issue that involves, and of course the city manager, and of course your role in the city council role, which is effectively as a year-night to these initiatives that's the staffing for you.

993
02:58:12,870 --> 02:58:19,050
Yeah, on the PSY, one of the bonds is way the AA, instead of AA plus.

994
02:58:20,730 --> 02:58:27,290
Why would one bond, way the AA and the rest of the bonds, way the AA plus?

995
02:58:27,890 --> 02:58:28,850
Great, great question.

996
02:58:29,110 --> 02:58:35,110
So, as James had talked about when we looked at the tools that are available for issuance of debt,

997
02:58:35,530 --> 02:58:38,510
it really becomes an issue of the security pledge.

998
02:58:38,510 --> 02:59:02,910
And the AA rated bond is your tax allocation refunding bonds from 2015, because it's based upon property value, and it's somewhat passive, you know, properties go up, properties go down, and so that's why that one is rated AA, that's an outstanding credit for a tax allocation bond.

999
02:59:02,910 --> 02:59:08,910
And, you know, I think it was, was it 24, but they were upgraded?

1000
02:59:10,730 --> 02:59:13,530
So those bonds were actually double A minus originally.

1001
02:59:14,010 --> 02:59:20,350
S&P came in, standard imports came in, upgraded those to double A in 2024.

1002
02:59:21,730 --> 02:59:27,410
So that's a, a very, very strong rating, but again, it's, you're, you're, when you think

1003
02:59:27,410 --> 02:59:31,790
about like your other types of debt, where you have the rates and charges of your water

1004
02:59:31,790 --> 02:59:38,210
fund and you're sewer fund, those are view at a higher credit rating of double A plus and

1005
02:59:38,210 --> 02:59:45,790
you're general fund because of your strong management policy framework and wealth factors

1006
02:59:45,790 --> 02:59:48,710
that the community are also rated double A plus.

1007
02:59:49,490 --> 02:59:53,230
So, but in the minds of the rating agency, they're a stronger credit.

1008
02:59:54,050 --> 02:59:55,030
Okay, thank you.

1009
03:00:00,720 --> 03:00:02,840
Okay, next slide, please.

1010
03:00:06,500 --> 03:00:33,800
Yes, we just went over the different team members. And as you won't be surprised to learn, there's also many steps in the process. So, you know, from kickoff to sizing, structuring, how much debt can the individual utility, or can the general fund afford to pay to the documentation and disclosure process to make sure we're telling investors, all the material information regarding the credit and the source.

1011
03:00:33,820 --> 03:00:40,000
of repayment going to S&P rating agency, getting that rating, coming back to you the city council

1012
03:00:40,000 --> 03:00:45,040
with all those documents to actually authorize and say yes, let's move forward with this

1013
03:00:45,040 --> 03:00:51,220
bond financing, going to the marketplace with the underwriter, finding out what investors

1014
03:00:51,220 --> 03:00:55,860
will demand, what interest rate, the investors will demand, that's what we call the sale and

1015
03:00:55,860 --> 03:01:00,840
the pricing, locking in the interest rates at that time and then typically will close the financing

1016
03:01:00,840 --> 03:01:08,520
two weeks later, meaning funds are in hand at closing, and not to gloss over the last part,

1017
03:01:08,620 --> 03:01:14,220
which really falls onto city staff. All of us as financing team consultants, we help on the first

1018
03:01:14,220 --> 03:01:19,560
side of things to get the deal closed, but then it's really city staff that's going to be administering

1019
03:01:19,560 --> 03:01:24,680
the bond, continuing disclosure to bondholders, letting them know, hey, we're still okay,

1020
03:01:24,680 --> 03:01:31,260
Melpedus is still doing good here. These bonds are still getting paid. Any other IRS, audit,

1021
03:01:31,460 --> 03:01:37,820
inquiries, these kinds of things come up from time to time. So it really is not just the

1022
03:01:37,820 --> 03:01:43,300
financing issuance timeline, but really you're living with that debt, the entire life of the debt.

1023
03:01:49,080 --> 03:01:50,700
Okay, if you could go to the next slide, please.

1024
03:01:53,240 --> 03:01:57,200
So this gets back to the question of credit ratings again.

1025
03:01:57,200 --> 03:02:04,960
So going left to right, you're looking at a AAA being the highest rating to triple C being

1026
03:02:04,960 --> 03:02:13,700
basically not credit worthy, so to speak, non-investment grade credit, as we talked about,

1027
03:02:13,900 --> 03:02:22,480
the city is in a very strong position, you're currently rated AAA as a city by standard

1028
03:02:22,480 --> 03:02:30,880
doors, your water, sewer, lease revenue bonds are double a plus. And again, that's typically

1029
03:02:30,880 --> 03:02:37,280
the way it works where you're a notch lower than your credit rating as a city because

1030
03:02:37,280 --> 03:02:44,680
of the fact that you have the legal provisions and other matters of why a debt is rated

1031
03:02:44,680 --> 03:02:50,320
a notch lower than what you are as a city. So the triple a rating of the city double a plus

1032
03:02:50,320 --> 03:02:53,060
by the on your outstanding credit.

1033
03:02:53,520 --> 03:02:57,240
And as we mentioned, the AA on the tax allocation bonds.

1034
03:02:57,940 --> 03:02:59,940
So some of the things that the sit,

1035
03:03:00,480 --> 03:03:02,120
when, as soon as you look at your credit,

1036
03:03:02,280 --> 03:03:04,540
they really look at the local economy,

1037
03:03:05,460 --> 03:03:07,800
your tax base, your demographics,

1038
03:03:08,240 --> 03:03:13,580
your wealth factors, per capita affected by an income,

1039
03:03:13,980 --> 03:03:16,160
they look at your financial results,

1040
03:03:16,760 --> 03:03:19,180
whether you do have deficits

1041
03:03:19,180 --> 03:03:26,000
or whether you have strong reserves, they look at your existing debt and your pension obligations

1042
03:03:26,000 --> 03:03:30,100
to know how much liability that you have.

1043
03:03:30,420 --> 03:03:39,680
I can't stress enough the importance of management and policy framework and financial reporting

1044
03:03:39,680 --> 03:03:44,240
to make sure that your annual audits are done on time.

1045
03:03:44,240 --> 03:03:55,660
There's no management findings in the audits that you have a very strong effective policy framework to govern how things are done.

1046
03:03:56,300 --> 03:04:05,420
And then stability and management is a very important thing, too. Also, you know, the governance and political environment and it's another factor that S&P looks at.

1047
03:04:05,420 --> 03:04:11,860
Again, the credit rating is an independent external review.

1048
03:04:13,400 --> 03:04:29,200
We help you present your story to them, but we really have no ability to challenge them on what they come up with in terms of their internal process of going to credit committee and coming back with the rating.

1049
03:04:29,200 --> 03:04:34,780
but our job is to really make sure that we put together a presentation that really

1050
03:04:34,780 --> 03:04:43,620
essentially it's all the positive factors of the community and I did want to ask you

1051
03:04:43,620 --> 03:04:49,040
if you would talk a little bit about how we are always when we are in public we are

1052
03:04:49,040 --> 03:04:50,860
always speaking to the market.

1053
03:04:51,820 --> 03:04:58,100
Yeah I would definitely say that that's very important consideration to think about and

1054
03:04:58,100 --> 03:05:05,940
James will go in a little bit further, but it's really important as policy makers and stakeholders

1055
03:05:06,880 --> 03:05:13,880
to really think about the benefit of the community, the community as a whole, the put a positive

1056
03:05:16,890 --> 03:05:23,170
presentation forward about the community, how you're working together as policy makers for the benefit of the community

1057
03:05:23,170 --> 03:05:35,950
And how everything that is done is to really keep moving the city forward, both from a development perspective, but a financial perspective.

1058
03:05:36,490 --> 03:05:45,650
And how you really have to be careful about what you say in a public meeting, public setting about the community, the financial health of the community.

1059
03:05:45,650 --> 03:05:54,590
And just be cognizant of the fact that things get picked up on the Internet by the

1060
03:05:54,590 --> 03:06:00,650
rating agencies, by social media, and it's more now than ever before.

1061
03:06:02,170 --> 03:06:03,510
James, anything you want to add?

1062
03:06:03,850 --> 03:06:08,710
Yeah, I mean, just to put it into dollars and cents, the better credit rating you have,

1063
03:06:09,030 --> 03:06:10,750
the lower cost borrowing, right?

1064
03:06:10,750 --> 03:06:19,110
And so, obviously, the city's done a very good job maintaining strong financial metrics and

1065
03:06:19,110 --> 03:06:24,370
as Mr. Fabian says, the S&P, they do read the newspapers, investors read the newspapers

1066
03:06:24,370 --> 03:06:24,770
too.

1067
03:06:25,910 --> 03:06:28,630
So, we want to always put our best foot forward for the city.

1068
03:06:33,750 --> 03:06:35,310
Okay, we're going to go to the next slide, please.

1069
03:06:40,520 --> 03:06:48,080
Okay, so in terms of the way bonds are sold, we have a couple different ways that we sell bonds.

1070
03:06:48,820 --> 03:06:52,160
So, we sell your bonds to the public.

1071
03:06:52,460 --> 03:06:55,220
So, anyone has the opportunity to buy a millpeed

1072
03:06:55,220 --> 03:06:56,720
as bond, whether as an individual

1073
03:06:56,720 --> 03:07:00,820
or through a mutual fund or another fund.

1074
03:07:01,600 --> 03:07:05,340
So, there's typically two ways that public offerings are done.

1075
03:07:05,980 --> 03:07:09,160
A competitive sale is done where you say,

1076
03:07:09,440 --> 03:07:14,440
on this date, at this time, every underwriting desk

1077
03:07:14,440 --> 03:07:17,140
has the opportunity to bid on your bonds,

1078
03:07:17,140 --> 03:07:25,500
provide the best bid, and it's awarded to the bank that produces the best true interest

1079
03:07:25,500 --> 03:07:29,920
cost to the city. For example, James and I both worked.

1080
03:07:30,000 --> 03:07:59,740
For the city of San Bruno across the bay, on they had a, actually, we're lucky to get a general obligation bond authorization by their community on August 4th. We did a competitive sale. We got 10 bids. We awarded to the Bank of, uh, provided the best bid to the city of San Bruno. So that's a competitive sale. On a negotiated sale, that's where a bank is selected, uh, based upon their ability to underwrite bonds.

1081
03:07:59,740 --> 03:08:08,620
there expertise to underwrite bonds and historically the city has had a very good work in relationship with

1082
03:08:08,620 --> 03:08:16,500
steeple Nicholas as an underwriter who has assisted the city to underwrite the bonds going back to

1083
03:08:16,500 --> 03:08:23,320
the 2015 tax allocation refunding bonds, the water and wastewater bonds, and then the least revenue

1084
03:08:23,320 --> 03:08:29,540
bonds that we talked about. And so under this situation there are selected based upon that

1085
03:08:29,540 --> 03:08:36,900
expertise. We as your municipal advisor, a work to make sure that they provide a cost

1086
03:08:36,900 --> 03:08:43,300
and underwriters discount that is fair and representative of the current market situations.

1087
03:08:43,960 --> 03:08:50,220
They are brought on early and they help in the structuring of the debt. We're on a competitive

1088
03:08:50,220 --> 03:08:56,080
sale, the underwriter basically is on that day, given the information about the debt and

1089
03:08:56,080 --> 03:09:03,620
provide their bid. The basis of award, as I mentioned, on a competitive sales, the lowest

1090
03:09:03,620 --> 03:09:09,300
true interest cost on a negotiated sale. There's a little bit more flexibility, because you can

1091
03:09:09,300 --> 03:09:15,040
work with the underwriter to say on this day, it doesn't look so great, so let's wait, and you

1092
03:09:15,040 --> 03:09:23,040
have a little bit more nimbleness to enter the market. Competitive sale is where you're a frequent

1093
03:09:23,040 --> 03:09:28,080
an issuer, like say the city of San Francisco, who's regularly in the market, like pretty

1094
03:09:28,080 --> 03:09:33,320
much every other month, so they have a very strong name in the bond market.

1095
03:09:33,780 --> 03:09:39,380
Milpedis, you don't issue a lot of debt, so you're more of a story to talk to investors

1096
03:09:39,380 --> 03:09:43,480
about, but you're a strong credit, and that helps.

1097
03:09:44,420 --> 03:09:50,180
So typically, like on a negotiated sale, it's more complex, or there's less familiarity with

1098
03:09:50,180 --> 03:09:50,620
the credit.

1099
03:09:50,620 --> 03:10:08,460
The other method on the right there is a private placement sometimes a bond might not be the best way to go because of a specific situation like say for like an energy efficiency project and you want to go directly to a bank to get a loan.

1100
03:10:08,460 --> 03:10:15,980
And so that's what a private place been is, where you direct and negotiate strictly with a bank to provide a bank loan.

1101
03:10:16,620 --> 03:10:22,600
There's no public offering that bank holds that credit for the 10 or 15 year term.

1102
03:10:23,040 --> 03:10:28,380
Typically it's a smaller borrowing amount and it's more efficient to do on a private place with basis.

1103
03:10:28,620 --> 03:10:32,580
So those are the mechanisms of how bonds are sold.

1104
03:10:34,120 --> 03:10:35,480
Next slide, please.

1105
03:10:38,100 --> 03:10:42,540
Jim just kind of went over this public offering versus private placement. Most of what we've

1106
03:10:42,540 --> 03:10:46,560
been talking about tonight is just kind of assuming the public offering, you know, multiple

1107
03:10:46,560 --> 03:10:52,340
investors, the disclosure documents, so that the investors know what they're buying. Again,

1108
03:10:52,800 --> 03:10:56,440
as Mr. Fabian just mentioned, the private placement, you're just working with one lender,

1109
03:10:56,800 --> 03:11:01,660
think about just going down the street to your mortgage lender, one bank. And so,

1110
03:11:02,620 --> 03:11:11,280
Yeah, fast forward. Next slide. Again, private placement versus public offering just different ways to access the marketplace. Next slide.

1111
03:11:13,510 --> 03:11:19,690
Okay, so here. This is the example I wanted to walk through for you about like a hypothetical borrowing.

1112
03:11:20,630 --> 03:11:26,610
And so under this case, what we did is we just assumed that you need $10 million for a project.

1113
03:11:26,610 --> 03:11:34,690
Okay. And so you're going to borrow a $10 million amount of bonds. Investors are going

1114
03:11:34,690 --> 03:11:39,710
to pay you a premium because they want higher coupon. So they're actually going to pay

1115
03:11:39,710 --> 03:11:45,250
$500,000 to get a higher coupon to you. So that's a different additional source of money.

1116
03:11:45,430 --> 03:11:52,750
So you have $10.5 million as a source for you. You need $10 million for your project fund

1117
03:11:52,750 --> 03:12:01,050
on this hypothetical project, you have a debt service reserve fund of $200,000 in cost of

1118
03:12:01,050 --> 03:12:07,850
issuance of $300,000. And so the debt service reserve fund is for the benefit of the bond

1119
03:12:07,850 --> 03:12:16,990
holders in case there was a non-payment. And then the cost of issuance are the fixed cost of

1120
03:12:16,990 --> 03:12:25,210
myself and James and the underwriter to actually sell the bonds. So sources on the left uses

1121
03:12:25,210 --> 03:12:31,170
on the right, if you could go to the next slide, please. Before you do that, can you explain

1122
03:12:31,170 --> 03:12:39,810
what coupons are in this context? Sure. So coupons are the actual, in the old days,

1123
03:12:40,170 --> 03:12:46,410
you actually would get a paper coupon and say, I would like to present this for payment and

1124
03:12:46,410 --> 03:12:54,630
say 4.25% on this bond and so that's the coupon is the individual bond and then the amount of

1125
03:12:54,630 --> 03:13:00,570
the interest for that individual bond. We still use the term even though everything's electronic now.

1126
03:13:03,660 --> 03:13:09,560
Okay so on the next slide so this is the hypothetical debt service payment for that $10 million

1127
03:13:09,560 --> 03:13:17,800
And we're assuming a level of borrowing at 4% over 20 years.

1128
03:13:18,480 --> 03:13:25,580
And so you can see here that to repay that 10 million principle and interest over that 20 year period.

1129
03:13:25,840 --> 03:13:32,020
It actually cost you $4.7 million in interest to repay that.

1130
03:13:32,240 --> 03:13:38,700
And you can see the level of debt service on the graph on the right where you have your interest.

1131
03:13:38,700 --> 03:13:46,400
That's higher in the early years and then lower in the latter years because you're principle just like on your mortgage

1132
03:13:46,400 --> 03:13:53,560
You're paying more principle as the term comes to an end and so you can see on the last year

1133
03:13:53,560 --> 03:13:58,220
It's almost all principle and little interest and so those early years

1134
03:13:58,220 --> 03:14:00,960
You're definitely paying more interest

1135
03:14:01,720 --> 03:14:08,680
Typically as we talked about in your ten the bonds can be called and typically at a high

1136
03:14:08,700 --> 03:14:15,000
percent so you have no pre-payment penalty and that's typically where you can

1137
03:14:15,000 --> 03:14:20,840
for the next 10 years have a lower debt service amount because the interest rate

1138
03:14:20,840 --> 03:14:26,000
would be lower in that in that 11th year through the 20th year. So we always

1139
03:14:26,000 --> 03:14:30,700
as your municipal advisor look for those opportunities to refund

1140
03:14:30,700 --> 03:14:35,700
debt's point get up to the call date. So this is just a hypothetical example

1141
03:14:35,700 --> 03:14:37,060
that with that might be helpful.

1142
03:14:49,590 --> 03:14:57,230
Thank you. I'm trying to decide which way to go. Let's say

1143
03:14:57,230 --> 03:14:58,450
is there a certain amount.

1144
03:15:00,970 --> 03:15:23,350
Let's say you raise a, you want to raise 10 million or 15 million dollars, but stay point that you decide you want to be, you want to borrow this amount, or you want to have a bounce issue bounce.

1145
03:15:23,350 --> 03:15:27,870
Is there a clear cut, which way?

1146
03:15:28,170 --> 03:15:37,150
Yes, I think it really goes back to when you think about the context of what the facility is you need, right?

1147
03:15:37,670 --> 03:15:46,450
So you have a capital improvement program that you spend a lot of time putting together to define what your facility needs are.

1148
03:15:46,450 --> 03:15:52,650
or your infrastructure needs are you identify whether it's a $10 million project or a $50 million

1149
03:15:52,650 --> 03:15:59,470
project that you don't have $10 million or $50 million in the budget so you want to stretch

1150
03:15:59,470 --> 03:16:08,730
three payment out over that 20 or 30 year and so you have to decide well how much can I have

1151
03:16:08,730 --> 03:16:14,870
forward to pay in debt service and so like the fire station you know that was a general fund obligation

1152
03:16:14,870 --> 03:16:21,230
and so you had to have the wear with all in the general fun to pay that annual debt service

1153
03:16:21,230 --> 03:16:26,550
for the fire station. Same thing would apply here, whether it's a 10 million or 50 million,

1154
03:16:27,030 --> 03:16:32,070
you'd have to determine that you have enough resources in your budget to pay the debt service

1155
03:16:32,070 --> 03:16:38,650
because you're not getting a new revenue source to repay that debt. It has to come from existing

1156
03:16:38,650 --> 03:16:45,710
resources. If the interest rate is made at all, would the loan be more attractive that is

1157
03:16:45,710 --> 03:16:46,630
you in bond?

1158
03:16:48,970 --> 03:16:53,910
Typically, you're referring to like a private place but are alone with a bank, right?

1159
03:16:54,470 --> 03:17:02,690
Yes. Yeah. In most cases with your credit rating of a AA plus, that's the best way to borrow money,

1160
03:17:02,850 --> 03:17:09,570
because that provides you with the lowest cost funds, is by borrow. Going out in the public and using

1161
03:17:09,570 --> 03:17:14,910
in that AA plus rating to borrow money versus going to a bank.

1162
03:17:15,430 --> 03:17:19,930
Part of the back office work for lack of a better term that we do before we bring anything

1163
03:17:19,930 --> 03:17:26,290
to council is really looking at all the alternatives and which direction should we go and

1164
03:17:26,290 --> 03:17:31,330
what's the best for the situation for the asset or assets that the city wants within cities

1165
03:17:31,330 --> 03:17:37,630
needs for the reason for issuing the debt as well as the mechanism to pay off that debt.

1166
03:17:37,630 --> 03:17:39,510
So that's part of the evaluation.

1167
03:17:40,230 --> 03:17:42,490
So when we come to you on September 1st,

1168
03:17:42,590 --> 03:17:44,390
we'll be talking a little bit about why we chose

1169
03:17:44,390 --> 03:17:46,170
to go one labor system, another.

1170
03:17:49,850 --> 03:17:50,290
Okay.

1171
03:17:52,030 --> 03:17:53,270
All right, thank you.

1172
03:17:57,330 --> 03:17:58,530
Okay, next slide, please.

1173
03:18:01,660 --> 03:18:03,400
Okay, I have a couple here,

1174
03:18:03,620 --> 03:18:05,180
and we're getting toward the end here.

1175
03:18:05,320 --> 03:18:07,140
So thanks, everyone, for their patience.

1176
03:18:07,380 --> 03:18:09,020
But these are, these are important here.

1177
03:18:09,160 --> 03:18:10,940
This is kind of on the disclosure side.

1178
03:18:10,960 --> 03:18:12,340
So we touched on this earlier

1179
03:18:12,340 --> 03:18:19,840
where when we sell a bond in the marketplace, we're speaking to investors, the federal securities laws apply,

1180
03:18:20,440 --> 03:18:25,980
which means we have to provide all material information and make sure we're not omitting any material

1181
03:18:25,980 --> 03:18:30,820
information when we're selling these bonds because if there's a piece of material information, well,

1182
03:18:31,060 --> 03:18:35,480
it could affect the interest rate. You know, it could affect whether a buyer wants to buy the millpeeta's

1183
03:18:35,480 --> 03:18:40,280
bonds or not. For example, what is the rating? You know, if it's a double A plus rating,

1184
03:18:40,280 --> 03:18:41,740
That's what we're going to tell investors.

1185
03:18:42,020 --> 03:18:43,520
We're not going to tell them it's AAA, right?

1186
03:18:43,520 --> 03:18:45,780
That's an obvious error, you know?

1187
03:18:46,200 --> 03:18:49,340
But on the omission side, could be equally important.

1188
03:18:50,620 --> 03:18:53,880
You know, if we're financing a wastewater facility,

1189
03:18:54,380 --> 03:18:55,840
you know, we want to tell investors,

1190
03:18:56,520 --> 03:18:59,680
do we have enough money to complete the whole project, for example,

1191
03:19:00,340 --> 03:19:04,120
or did the Prop 218 rate study get accomplished

1192
03:19:04,120 --> 03:19:05,500
so that we have the revenues?

1193
03:19:05,700 --> 03:19:08,620
You know, those kind of things, it's not just what we tell investors,

1194
03:19:08,620 --> 03:19:11,420
but also what we don't omit to tell them.

1195
03:19:11,820 --> 03:19:13,740
And so as has already been alluded to,

1196
03:19:13,920 --> 03:19:16,360
you have a whole team working for you, the city,

1197
03:19:16,900 --> 03:19:20,260
to make sure we prepare a complete disclosure document,

1198
03:19:21,200 --> 03:19:23,180
the disclosure coordinator, in this case,

1199
03:19:23,300 --> 03:19:25,620
it'd be the finance director, over scene,

1200
03:19:25,860 --> 03:19:28,740
the rest of us on the team, working with city attorney,

1201
03:19:29,040 --> 03:19:31,800
city manager's office, public works,

1202
03:19:31,880 --> 03:19:34,180
whoever would have material information,

1203
03:19:34,180 --> 03:19:39,660
and you know, important information as to the debt being issued.

1204
03:19:40,220 --> 03:19:43,060
And again, as we alluded to earlier, that's the official statement.

1205
03:19:43,140 --> 03:19:46,100
That's prepared when we first issue and sell the bonds.

1206
03:19:46,360 --> 03:19:49,760
But on a going forward basis, we're going to be speaking to the marketplace.

1207
03:19:49,980 --> 03:19:55,420
We're going to be posting the audited financial statements of the city every year when they become available.

1208
03:19:55,800 --> 03:20:01,300
We're going to be providing investors, other statistical information that might be relevant.

1209
03:20:01,300 --> 03:20:07,180
Again, in a utility credit, for example, what is our net revenues available to pay debt service?

1210
03:20:07,360 --> 03:20:10,400
You know, what is our gross revenues, what's our operations and maintenance?

1211
03:20:10,500 --> 03:20:11,460
What's that coverage?

1212
03:20:11,620 --> 03:20:16,360
Making sure we're meeting that 115 coverage ratio we talked about earlier.

1213
03:20:17,560 --> 03:20:20,100
Also, material events, the ratings can change.

1214
03:20:20,560 --> 03:20:24,260
As was alluded to, your tax allocation bond actually got a rating upgrade.

1215
03:20:24,600 --> 03:20:25,900
That's material information.

1216
03:20:25,900 --> 03:20:33,160
We post that to the marketplace, so the investors know that and can trade in the bonds with that full information.

1217
03:20:34,380 --> 03:20:34,940
Next slide, please.

1218
03:20:39,170 --> 03:20:46,290
Again, bringing it back to the city council as the governing body, as the issuer of these bonds.

1219
03:20:47,690 --> 03:20:59,170
You are just like all of us subject to the federal securities laws, helping all of us make sure that we comply with that providing all the material information regarding the bond that we

1220
03:20:59,190 --> 03:21:05,130
collectively know about. The challenge with materiality is it's not a bright line test, right?

1221
03:21:05,230 --> 03:21:10,070
What is important to a particular investor in a bond? Think about yourself when you make your

1222
03:21:10,070 --> 03:21:16,790
investment decisions in a stock or a bond yourself, your individual portfolio, you want to have

1223
03:21:16,790 --> 03:21:22,790
as much information as you can, but obviously it's hard to know what pieces are material. So we do our

1224
03:21:22,790 --> 03:21:32,950
it's a reasonable judgment, kind of test and we just we talk about it on the right-hand side

1225
03:21:33,310 --> 03:21:39,950
in particular what what the city council should be doing is is just reading the documents that we bring before you,

1226
03:21:41,070 --> 03:21:48,030
asking staff and all of us as your consultants. If you have questions or if there's something that's not clear,

1227
03:21:48,030 --> 03:21:54,550
making sure there are disclosure policies and training, which this session is part of that

1228
03:21:54,550 --> 03:22:00,450
training, making sure you're up to date on what's going on in the city, and if additional

1229
03:22:00,450 --> 03:22:05,570
training is necessary, all of us are available. And again, making sure that we are disclosing any

1230
03:22:05,570 --> 03:22:11,970
potential risks, you know, seismic kinds of risk, litigation, material litigation that might

1231
03:22:11,970 --> 03:22:18,930
impacting a particular bond. Again, it can be all discussed internally as the financing team and

1232
03:22:18,930 --> 03:22:24,830
then decide what is disclosed to the to the outside investors because obviously some things

1233
03:22:24,830 --> 03:22:29,890
are privileged but we need to strike that right balance of providing all material information.

1234
03:22:30,110 --> 03:22:59,970
There's a footnote here. Orange County, as we all know, went bankrupt famously in 1990s. They had bonds. They got sued, and they got in trouble. Not just for going bankrupt, because they didn't tell investors, hey, there was these risks of the bankruptcy. Hey, we're trading highly speculative securities in our investment portfolio. They got in trouble for that. San Diego, 20 years later, got in trouble, including elected officials for not accurately disclosing their pension liabilities. San Diego,

1235
03:23:00,110 --> 03:23:05,190
self-funded their pension, they told investors, it was in the whole $400 million, it was actually

1236
03:23:05,190 --> 03:23:11,530
in the whole $2 billion. And so that was a problem, investors needed to know that. And so again,

1237
03:23:11,690 --> 03:23:16,830
those are pretty egregious examples, you know, but there are just examples that are out there.

1238
03:23:17,250 --> 03:23:21,830
If you know something, please bring it to staff attention.

1239
03:23:25,050 --> 03:23:27,510
And I think we're on to our own nearly

1240
03:23:27,510 --> 03:23:35,810
last slide here. Yeah, again, we've talked about this. Everything comes through the city council

1241
03:23:35,810 --> 03:23:44,510
as the governing board, approving any kind of bond financing and delegating to staff, final pricing

1242
03:23:44,510 --> 03:23:50,110
terms and conditions, reviewing that official statement before it's disseminated to potential

1243
03:23:50,110 --> 03:23:56,950
investors, understanding what material means that a reasonable investor would consider important

1244
03:23:56,950 --> 03:24:02,970
in their investment decision and just working with city staff and your consultants.

1245
03:24:06,080 --> 03:24:07,200
Next one.

1246
03:24:09,040 --> 03:24:09,620
That's it.

1247
03:24:09,720 --> 03:24:10,620
I think turn it back.

1248
03:24:12,000 --> 03:24:12,040
Yeah.

1249
03:24:12,360 --> 03:24:16,460
So let's wrap things up here on policy framework and key takeaways.

1250
03:24:17,720 --> 03:24:21,380
You have an existing debt management policy that was adopted.

1251
03:24:21,820 --> 03:24:24,180
It's referenced there down below.

1252
03:24:24,180 --> 03:24:30,800
Key document to describe how that will be issued within the city of Milpetus.

1253
03:24:31,460 --> 03:24:39,780
You have existing reserve and investment policies that are very important for the rating agency and bond investors.

1254
03:24:40,380 --> 03:24:47,040
You have and continue to provide continuing disclosure to the marketplace on an annual basis.

1255
03:24:47,040 --> 03:24:55,080
Are you also are required to provide reports to CDAC who tracks all debt issued within California by public agencies?

1256
03:24:57,320 --> 03:25:05,540
Each when you approve the audit, the audit contains footnotes and tables related to your outstanding debt.

1257
03:25:06,240 --> 03:25:15,760
And there's a consistency between the debt management policy, the capital improvement program in any applicable rate study.

1258
03:25:15,760 --> 03:25:35,260
Some of the key takeaways that we wanted to leave you with is that, you know, when you think about debt, it's your debt, the city's debt must be actively managed to be able to understand exactly the profile where the debt is and repayment of that debt.

1259
03:25:35,260 --> 03:25:53,120
We, the finance team, work for the city, we answer to you, the security pledge, as we talked about as a central question in any issue, each of the financing tools that we talked about has a different security pledge.

1260
03:25:53,120 --> 03:26:04,000
The accurate disclosure is continuing legal duty of not only staff, but the elected officials.

1261
03:26:05,340 --> 03:26:17,780
The council approves all the documents related to a dead issuance with certain parameters that are put into the resolution to be the not to exceed amounts,

1262
03:26:17,780 --> 03:26:24,360
whether that's the not to seed interest rate under writer's discount, a true interest cost,

1263
03:26:24,760 --> 03:26:32,300
or minimum savings requirement. A strong policy framework is absolutely essential to keep

1264
03:26:32,300 --> 03:26:39,480
that strong credit rating that you have. And so really proud of the fact that you have such a high

1265
03:26:39,960 --> 03:26:46,560
credit rating and staff and the electives have worked real hard to maintain that over the years.

1266
03:26:46,560 --> 03:26:54,160
And as we talked about, the council discussions are closely watched by the investment community

1267
03:26:54,160 --> 03:26:57,820
and can influence the perception of the city's credits.

1268
03:26:58,440 --> 03:27:00,320
So we really appreciate your time tonight.

1269
03:27:00,560 --> 03:27:05,640
We hope we provided you with a comprehensive overview of debt,

1270
03:27:06,080 --> 03:27:11,220
how it's issued, why it's issued, and answer any questions that you have related to debt.

1271
03:27:13,170 --> 03:27:18,730
I want to thank Jim and James both to come in to help us with this question.

1272
03:27:19,350 --> 03:27:21,390
This is important to understand.

1273
03:27:22,410 --> 03:27:27,110
This is a big responsibility and this is one of the most significant responsibilities

1274
03:27:27,110 --> 03:27:32,310
along with adopting the budget that the City Council has and this is just another way of investing

1275
03:27:32,310 --> 03:27:37,650
in the community and providing those services and those assets that the community wants

1276
03:27:37,650 --> 03:27:38,410
and needs.

1277
03:27:38,410 --> 03:27:48,890
So, again, if we have any other questions or concerns or I'm also available as well.

1278
03:27:59,660 --> 03:28:02,580
This is a follow up question of my previous question.

1279
03:28:02,900 --> 03:28:17,760
If I would ask for a guideline for deciding whether I should go with issuing bonds or borrowing money,

1280
03:28:17,760 --> 03:28:21,920
What kind of guy non you could give me?

1281
03:28:23,260 --> 03:28:27,420
Is it depend on interest rate or depend on the Aman?

1282
03:28:28,060 --> 03:28:29,260
I'm boring.

1283
03:28:31,720 --> 03:28:33,620
Just give me some basic guidelines.

1284
03:28:34,940 --> 03:28:41,700
Well, as we talked about, you have debt policies that are the guidelines for how you issue debt

1285
03:28:41,700 --> 03:28:43,920
when you issue debt and why you issue debt.

1286
03:28:43,920 --> 03:28:50,160
So, I would encourage everybody to look over those guidelines that you currently have.

1287
03:28:50,960 --> 03:28:59,600
And, you know, when you think about issuance of debt, you really have to put it into the context of the capital improvement program.

1288
03:29:00,340 --> 03:29:06,280
Your current budget and your current resources available to pay debt service.

1289
03:29:06,520 --> 03:29:11,940
And when you factor all those things in, that's how you make a decision whether to borrow,

1290
03:29:11,940 --> 03:29:16,920
because as we talked about that $10 million or $50 million project, you don't have that

1291
03:29:16,920 --> 03:29:23,960
money sitting unencumbered and available to fund one project in one year, you have to stretch

1292
03:29:23,960 --> 03:29:31,360
it out so that you have a manageable debt service payment each year and that that cost is paid

1293
03:29:31,360 --> 03:29:39,380
by not only your current residents, but the future residents. So it's really not like there's

1294
03:29:39,380 --> 03:29:50,020
I, you know, I could say these three things are factors in when you issue debt, but, it's, it's in the context of the larger picture of your financial situation.

1295
03:29:50,380 --> 03:29:53,380
I would suggest to you that it's an art not a science.

1296
03:29:55,380 --> 03:29:59,480
Because it's a given situation where the city is, what do you want to do with that money?

1297
03:30:00,000 --> 03:30:07,640
What do we, what benefit will it bring on both in the short and the long term? So it is always an art, not a science.

1298
03:30:09,500 --> 03:30:28,840
I would also say that we have links that are in the item themselves. The CDX CDIAC has really good training. They do it in a wonderful way in like 15 minutes sound vibes, which I like because it's like I can only listen for 15 minutes until listen again, but they do have a really good training program.

1299
03:30:28,840 --> 03:30:37,140
And if you want to just listen to it while you're in the car, you log in and you just listen to it ever again.

1300
03:30:38,320 --> 03:30:40,040
These are complex issues.

1301
03:30:40,860 --> 03:30:46,820
And along with budget it is how you issue debt as a community, as a municipality,

1302
03:30:47,400 --> 03:30:53,380
is an indication of what the community wants and what the council believes the community wants.

1303
03:30:53,380 --> 03:31:00,720
is that is a sort of, it's an, it's also an investment, because you're saying I want,

1304
03:31:00,720 --> 03:31:05,780
we want this asset, community is told us we want this asset, and we want this asset for the long-term.

1305
03:31:06,960 --> 03:31:14,860
So, I look at debt fairly as one tool in the toolbox to basically improve the city on a long-term basis.

1306
03:31:15,860 --> 03:31:22,260
I think another factor too, when you think about a debt issuance, it's cheaper to build something in

1307
03:31:22,260 --> 03:31:27,620
twenty twenty six, then it will be in twenty twenty nine. And so when you factor in rising

1308
03:31:27,620 --> 03:31:35,480
cost that we've been really dealing with, you know, on a significant basis since we had

1309
03:31:35,480 --> 03:31:43,700
the COVID shutdown and inflation has come back that if you can say, well, it'll be cheaper

1310
03:31:43,700 --> 03:31:50,040
to build something now than wait. And that should be another factor in deciding whether or not

1311
03:31:50,040 --> 03:31:55,720
issue debt to build something now versus later. This is only going to be more expensive down later.

1312
03:32:02,560 --> 03:32:11,000
Any other questions? I have a question or to so I'm looking at, well, thank you for the

1313
03:32:11,000 --> 03:32:17,720
information and education. I'm looking at the types of financing being discussed and it looks like

1314
03:32:17,720 --> 03:32:25,900
that we have currently, as you said, the water sewer and the general fund back up by the

1315
03:32:25,900 --> 03:32:26,700
list revenue.

1316
03:32:28,540 --> 03:32:33,160
The question is, regardless of the source of the financing,

1317
03:32:35,560 --> 03:32:38,380
is there a limitation on where

1318
03:32:38,380 --> 03:32:44,300
to spend the proceeds of the loan or it depends on the kind of financing?

1319
03:32:46,080 --> 03:32:54,040
Yes. Each bond does have limitations. If it is the sewer bond, for example, that's paid from

1320
03:32:54,040 --> 03:33:00,080
sewer rates, it's got to go for sewer infrastructure, water system, water infrastructure.

1321
03:33:00,920 --> 03:33:07,260
Generally, you have more flexibility. Generally, how you use your general fund. In that particular

1322
03:33:07,260 --> 03:33:12,800
bond, we told investors we're going to use it for a fire station, but you could use your

1323
03:33:12,800 --> 03:33:19,760
of fund to back projects otherwise available to the general fund. So, really depends on each

1324
03:33:19,760 --> 03:33:28,940
each bond. Okay, I get that. So, for example, we can do a list revenue financing if we build that

1325
03:33:28,940 --> 03:33:37,280
proverbial station to, right, but for other purpose and not limited to each kind of financing,

1326
03:33:37,280 --> 03:33:45,020
We can do a general obligation funds and that's where we get funds for certain things that we need.

1327
03:33:45,160 --> 03:33:54,880
Not necessarily, we'll be necessarily to be an asset whether built or purchase or it can be for another purpose.

1328
03:33:55,860 --> 03:33:59,280
Well, again, that kind of brings in the tax exemption rules we talked about.

1329
03:33:59,320 --> 03:34:05,940
If you want a borrowed tax exempt, which is lowest cost borrowing, it's got to be a public capital facility.

1330
03:34:05,940 --> 03:34:13,320
So that'd be some kind of structure, some kind of building your building, but as Mr. Fabian mentioned, sometimes

1331
03:34:14,100 --> 03:34:23,960
cities, bond finance for other purposes, you know cash flow financing, you know, Ford will housing, you know, anything that you can put your general fund toward is is legally permissible

1332
03:34:24,640 --> 03:34:29,820
just a question of what's the interest rate, what's the, you know, sort of tax status of that.

1333
03:34:29,820 --> 03:34:36,260
All right. So a general obligation button has more leeway on expanding. Well, remember, a general obligation

1334
03:34:36,260 --> 03:34:44,540
bond requires 67% of the residents in the community to approve it. So step one, in that ballot measure,

1335
03:34:44,900 --> 03:34:51,640
you have to be very specific as to what you're going to spend that money on. Okay. And so it has to

1336
03:34:51,640 --> 03:34:59,300
be a clearly defined purpose of what the project is. That general obligation bond will fund. So it's

1337
03:34:59,300 --> 03:35:04,140
is that to be approved by the voters? Yes, sir. All right. Thank you.

1338
03:35:13,340 --> 03:35:20,180
Can somebody believe me? Thank you. Thank you. Thank you, gentlemen, for the presentation.

1339
03:35:21,100 --> 03:35:30,360
And I want to thank Louves and your team for all the hard work. Every single time after the audit,

1340
03:35:30,360 --> 03:35:33,320
I always ask, do we have good rating?

1341
03:35:34,660 --> 03:35:37,360
Is it triple A plus plus?

1342
03:35:38,420 --> 03:35:41,660
Because that demonstrates how strong we are

1343
03:35:41,660 --> 03:35:44,600
and how fiscal responsible we are.

1344
03:35:45,180 --> 03:35:47,720
So thanks again for all the effort

1345
03:35:47,720 --> 03:35:50,040
in protecting our financial stability.

1346
03:35:51,280 --> 03:35:52,680
And again, thank you, gentlemen.

1347
03:35:53,160 --> 03:35:55,900
I would like to take back my comment

1348
03:35:55,900 --> 03:35:58,660
about if we have a deficit, how do we pay?

1349
03:35:58,660 --> 03:36:00,640
That's not going to happen.

1350
03:36:00,800 --> 03:36:02,340
So I prefer echo.

1351
03:36:02,840 --> 03:36:03,660
So thank you.

1352
03:36:05,980 --> 03:36:12,320
Oh, with that, if no one else has any questions I would like to move this motion to our doctors.

1353
03:36:12,880 --> 03:36:14,180
There's no need for a motion.

1354
03:36:14,200 --> 03:36:15,880
This is just receiving a presentation.

1355
03:36:16,380 --> 03:36:16,660
Okay.

1356
03:36:16,860 --> 03:36:17,600
I try.

1357
03:36:19,300 --> 03:36:20,160
Thank you.

1358
03:36:21,180 --> 03:36:21,660
Thank you.

1359
03:36:21,760 --> 03:36:22,060
Thank you.

1360
03:36:22,140 --> 03:36:22,420
Thank you very much.

1361
03:36:42,560 --> 03:36:54,960
I have no public speaker cards for this item. I believe we do have Voltaire Montméor that wants to provide public comment.

1362
03:36:59,180 --> 03:37:01,320
Welcome Mr. Muntama Yvonne.

1363
03:37:02,340 --> 03:37:06,960
Full-term Muntama Yvonne of Melpita's great presentation.

1364
03:37:10,390 --> 03:37:13,610
I was kind of late, but I made it.

1365
03:37:14,090 --> 03:37:18,530
We have those Nasdaq Dow Jones, S&P.

1366
03:37:19,190 --> 03:37:25,370
The big companies in the United States will be going up, won't go down.

1367
03:37:25,550 --> 03:37:29,450
Nervous our hope is those business.

1368
03:37:30,000 --> 03:37:32,640
They have their markets.

1369
03:37:35,130 --> 03:38:01,490
In other words, if we have those bonds and we would be like us in the back. As long as we have, we have

1370
03:38:01,490 --> 03:38:13,230
As I was impassizing the business like other big companies should be robustly growing, and we will not lose hope.

1371
03:38:13,230 --> 03:38:14,890
We will gain. Thank you.

1372
03:38:17,240 --> 03:38:20,380
And there are no virtual attendees. We have no additional public speakers.

1373
03:38:21,740 --> 03:38:22,900
Thank you.

1374
03:38:23,700 --> 03:38:26,020
And being from the staff for

1375
03:38:29,160 --> 03:38:30,600
thank you.

1376
03:38:30,600 --> 03:38:38,680
So next we'll move to our announcements and future agenda items, the manager and the announcements.

1377
03:38:40,020 --> 03:38:42,000
No announcements at this time.

1378
03:38:42,540 --> 03:38:43,240
Vice Mayor.

1379
03:38:43,480 --> 03:38:44,020
Thank you.

1380
03:38:44,300 --> 03:38:46,820
Any announcements from my colleagues?

1381
03:38:52,240 --> 03:38:52,480
Constantly.

1382
03:38:53,100 --> 03:38:53,840
Thank you.

1383
03:38:53,920 --> 03:39:01,420
I would like to invite everybody this Saturday for the grand opening of our very own Mopi

1384
03:39:01,420 --> 03:39:10,360
Just pickler over by Ranch Drive, 128, between HL restaurant and in and out.

1385
03:39:10,780 --> 03:39:13,380
Please come. Thank you.

1386
03:39:13,420 --> 03:39:14,460
Thank you.

1387
03:39:22,550 --> 03:39:23,010
Thank you.

1388
03:39:23,250 --> 03:39:23,930
Yes.

1389
03:39:25,390 --> 03:39:29,250
I will leave a call today and I don't know if this goes to staff.

1390
03:39:30,730 --> 03:39:36,610
But by up on the hills where we have dry, very tall, brown, grass.

1391
03:39:38,330 --> 03:39:42,650
I think we should take care of that, because that would be dangerous,

1392
03:39:45,030 --> 03:39:46,570
you know, really easily

1393
03:39:46,570 --> 03:39:47,830
spark for fire.

1394
03:39:49,910 --> 03:39:51,490
So please take care of that.

1395
03:39:51,490 --> 03:39:52,270
Thank you.

1396
03:39:57,640 --> 03:39:58,640
We take note of that.

1397
03:39:59,120 --> 03:40:00,180
Thank you.

1398
03:40:00,380 --> 03:40:01,180
Any other announcements?

1399
03:40:03,020 --> 03:40:05,440
I have an announcement.

1400
03:40:06,420 --> 03:40:07,260
And it's been a while.

1401
03:40:07,260 --> 03:40:17,400
I believe this is the part where we can pull the council for a certain policy or an ordinance going forward.

1402
03:40:17,960 --> 03:40:19,600
Start to the priority list.

1403
03:40:21,180 --> 03:40:21,400
Yes.

1404
03:40:23,160 --> 03:40:35,900
You know, I drive around the city every day and I have noticed electronic bicycles and scooters would like to see if there's some policy or an ordinance that we can do

1405
03:40:35,900 --> 03:40:44,960
to regulate them, and to incend it with coincidently, right?

1406
03:40:45,240 --> 03:40:50,940
I heard a news, I think somewhere in the area, that there was a fatal accident

1407
03:40:50,940 --> 03:41:01,960
about an eScooter, and I think it's timely to see if we have some issues with the numbers of electronic vehicles

1408
03:41:01,960 --> 03:41:04,400
that the tribes and the city will be

1409
03:41:04,400 --> 03:41:07,240
at and develop a policy on audience.

1410
03:41:09,720 --> 03:41:11,260
Yes, ma'am.

1411
03:41:12,400 --> 03:41:13,280
Oh, thank you.

1412
03:41:13,640 --> 03:41:16,700
I thought I brought this out a while back

1413
03:41:18,000 --> 03:41:23,380
with our announcements and I think city attorney.

1414
03:41:24,020 --> 03:41:27,440
Yeah, so I actually think that might have been my first meeting.

1415
03:41:28,080 --> 03:41:37,040
I believe at that time, for my notes, the council said that you'd accept an info memo from

1416
03:41:37,040 --> 03:41:39,720
PD to decide whether you want to bring this back up.

1417
03:41:39,760 --> 03:41:48,480
We didn't get a thing at any info memo, I believe we can make sure that gets forwarded.

1418
03:41:48,500 --> 03:41:53,180
But I think the intent was that if after seeing the info memo, you still wanted to pursue

1419
03:41:53,180 --> 03:41:54,920
something that you come back up at the announcements.

1420
03:41:54,920 --> 03:41:57,080
Okay, sounds good.

1421
03:41:57,340 --> 03:41:57,540
All right,

1422
03:41:59,780 --> 03:42:01,060
we can use consumer member,

1423
03:42:03,080 --> 03:42:10,120
Chua's initial thoughts to supplement what we could do as I proposed today.

1424
03:42:11,600 --> 03:42:17,060
Secondly, I would want to, I think this goes to the planned department.

1425
03:42:17,120 --> 03:42:20,580
If we can have a review, it's been a while.

1426
03:42:20,580 --> 03:42:25,400
the percentage of if there is a certain percentage

1427
03:42:25,400 --> 03:42:28,760
regards to mixed use developments in zoning.

1428
03:42:30,040 --> 03:42:37,260
So we have, you know, we have projects and the

1429
03:42:37,260 --> 03:42:40,400
repeated projects with the development of the city.

1430
03:42:40,660 --> 03:42:45,860
If we can review the certain percentage of mixed use developments

1431
03:42:45,860 --> 03:42:49,380
as to businesses and there's a potential portion of that.

1432
03:42:52,520 --> 03:42:54,720
I don't know if we need consensus.

1433
03:42:54,780 --> 03:43:00,060
We do require consensus for that, so I'll call for consensus on the percentage review

1434
03:43:00,060 --> 03:43:03,940
of percentage of mixed use developments in zoning, that's going to be council member

1435
03:43:03,940 --> 03:43:04,700
Chua.

1436
03:43:06,340 --> 03:43:09,440
Can you clarify please, I'm not clear on the request.

1437
03:43:10,720 --> 03:43:11,440
What is it?

1438
03:43:11,540 --> 03:43:16,460
I'll try to clarify it, so we've been talking

1439
03:43:21,000 --> 03:43:26,800
about the mixed use in rezoning or in projects

1440
03:43:26,800 --> 03:43:35,460
that comes to us and I understand that the word mixed use as to residential and commercial

1441
03:43:35,460 --> 03:43:41,780
component of a project that does not have a definite percentage or guidelines. We

1442
03:43:41,780 --> 03:43:47,800
regards to what percentage of a certain zone or what percentage of a certain development

1443
03:43:47,800 --> 03:43:55,320
or project is dedicated to the mix use of either residential or commercial.

1444
03:43:57,200 --> 03:44:00,040
So we just want an information on that?

1445
03:44:00,320 --> 03:44:07,020
Well, we may be deficient of, again, that's why we're trying to explore this.

1446
03:44:07,160 --> 03:44:11,120
We may be deficient as to a specific guideline.

1447
03:44:11,120 --> 03:44:23,460
as to, you know, asserting a project that comes to us in trying to enforce a mix-use policy

1448
03:44:23,460 --> 03:44:25,980
that regards to their application.

1449
03:44:27,060 --> 03:44:32,380
I think there's a dress on the general plan and then through the zoning ordinance.

1450
03:44:33,400 --> 03:44:35,660
I remember and you may be right.

1451
03:44:35,660 --> 03:44:38,720
It's just that when

1452
03:44:38,720 --> 03:44:39,360
it's certain

1453
03:44:40,680 --> 03:44:43,460
area, Jupiter comes to us, and we

1454
03:44:43,460 --> 03:44:45,400
rezone it, whether it's an

1455
03:44:45,400 --> 03:44:48,360
amendment to the general plan or

1456
03:44:48,360 --> 03:44:50,820
specific plan,

1457
03:44:51,700 --> 03:44:53,540
which has categorized it. I may be wrong.

1458
03:44:53,740 --> 03:44:56,340
That's why I'm asking. We categorized it

1459
03:44:56,340 --> 03:44:57,960
as, let's

1460
03:44:57,960 --> 03:44:59,720
rezone this to a mix use.

1461
03:45:00,000 --> 03:45:25,240
And we stop on the classification of mixed use without determining what kind of mixed use as to ocean of the recent area is mixed use as to being commercial or mixed use, the mixed use of commercial and residential portion of certain area.

1462
03:45:28,560 --> 03:45:35,340
If I could ask this for clarification, Vice Mayor, are you looking for staff to prepare something

1463
03:45:35,340 --> 03:45:40,500
that would explain what standards in terms of the relative percentages apply under our

1464
03:45:40,500 --> 03:45:41,600
different zoning types?

1465
03:45:41,860 --> 03:45:49,080
Because I think we have multiple mixed use classifications, and then based on that, the council

1466
03:45:49,080 --> 03:45:54,200
would have the ability if you're unhappy with those requirements to possibly agenda some

1467
03:45:54,200 --> 03:45:57,980
to prioritize an item or modification of those rules.

1468
03:45:58,280 --> 03:46:00,500
I think that's a fair way to start it.

1469
03:46:00,860 --> 03:46:03,720
Let's see a different policy that we have

1470
03:46:03,720 --> 03:46:04,860
with regards to mixed use.

1471
03:46:05,020 --> 03:46:10,880
And if there is an interest later on to see if we need to change it,

1472
03:46:10,900 --> 03:46:11,900
then it comes to the council.

1473
03:46:14,540 --> 03:46:16,700
Okay. Thank you. Thank you.

1474
03:46:16,700 --> 03:46:19,320
Thank you. That would still require a consensus vote.

1475
03:46:20,400 --> 03:46:22,120
That would still require a consensus.

1476
03:46:22,740 --> 03:46:25,440
That would still require a consensus vote.

1477
03:46:25,440 --> 03:46:25,880
Okay.

1478
03:46:26,820 --> 03:46:27,040
Hi.

1479
03:46:27,700 --> 03:46:29,440
Council member Lam.

1480
03:46:31,060 --> 03:46:32,180
Council member Leanne.

1481
03:46:33,820 --> 03:46:44,460
I'm not ready for that because at this moment we, we don't want to restrict or, you know,

1482
03:46:44,820 --> 03:46:48,120
discourage any of our development.

1483
03:46:50,700 --> 03:46:50,820
All right.

1484
03:46:51,040 --> 03:46:52,240
And then Vice Mayor Barbedo.

1485
03:46:52,240 --> 03:47:02,040
That's fine. My vote is aye. Thank you. With three affirmatives, that will move to our

1486
03:47:02,040 --> 03:47:02,820
vote.

1487
03:47:09,140 --> 03:47:15,540
I'm about to come with you. Chief, just one last in please. Also, in

1488
03:47:17,220 --> 03:47:25,460
The last request I had, I would like to see and release it at least for information for now.

1489
03:47:26,320 --> 03:47:27,920
What is our tree audience?

1490
03:47:29,640 --> 03:47:33,340
I did a little bit of digging on our tree audience.

1491
03:47:33,660 --> 03:47:36,880
I believe it was less dated or amended in 2016.

1492
03:47:37,960 --> 03:47:41,200
With the passage of ten years with the developments that we had,

1493
03:47:41,200 --> 03:47:46,280
We would like to see, you know, what's going on with our trees.

1494
03:47:47,320 --> 03:47:50,480
There's some types of trees on that audience.

1495
03:47:51,280 --> 03:47:53,960
And let's see if there is need to, you know,

1496
03:47:54,080 --> 03:47:57,180
to change that audience to protect more trees

1497
03:47:57,180 --> 03:48:00,120
or it's still appropriate under the current

1498
03:48:00,120 --> 03:48:02,400
in development circumstances.

1499
03:48:04,210 --> 03:48:06,630
All right, for consensus, Council member Chua.

1500
03:48:09,070 --> 03:48:09,870
Council member Lyon.

1501
03:48:09,870 --> 03:48:10,230
Hi.

1502
03:48:10,810 --> 03:48:11,430
Council member Lyon.

1503
03:48:12,190 --> 03:48:12,710
No.

1504
03:48:13,650 --> 03:48:14,670
And vice-merababadio?

1505
03:48:18,680 --> 03:48:20,240
With three forwardives that

1506
03:48:20,240 --> 03:48:21,260
is moved forward to the list.

1507
03:48:21,500 --> 03:48:22,400
Thank you, Madam Clerk.

1508
03:48:23,340 --> 03:48:27,200
And Chief, I believe that you have some information

1509
03:48:27,200 --> 03:48:28,860
that it regards to electric vehicles.

1510
03:48:29,260 --> 03:48:29,980
Yes, really briefly.

1511
03:48:30,060 --> 03:48:30,560
Thank you, sir.

1512
03:48:30,800 --> 03:48:31,080
Thank you.

1513
03:48:31,400 --> 03:48:35,300
There was a request from Council Member Chu in April of 26

1514
03:48:35,300 --> 03:48:37,440
when I was on the dice as the

1515
03:48:37,440 --> 03:48:38,740
from Iraq and city manager.

1516
03:48:39,380 --> 03:48:41,420
And at that time, we committed to an information memo.

1517
03:48:41,420 --> 03:48:47,860
information memo was drafted. I was under the impression that I was sent to you originally back then,

1518
03:48:48,040 --> 03:48:52,840
I found out at the end of July that it may not have been transmitted to you. I sent it to council

1519
03:48:52,840 --> 03:48:58,640
members on July 30th through email. If you didn't receive it, I just sent it again from the seat.

1520
03:48:59,160 --> 03:49:05,500
So it is in your email as a right now, at least it should be just to recap the main highlights from

1521
03:49:05,500 --> 03:49:10,660
that information memo to summarize it for you. We don't have an ordinance. We currently rely on the

1522
03:49:10,660 --> 03:49:15,160
vehicle code for enforcement efforts, for us that's been sufficient.

1523
03:49:15,420 --> 03:49:20,200
We don't experience the same level of issues that other cities do.

1524
03:49:20,660 --> 03:49:27,620
We had 1200, we looked at the period of January 2024 to April 26 because the request was in April

1525
03:49:27,620 --> 03:49:28,260
of 26.

1526
03:49:28,840 --> 03:49:36,520
We had 1211 traffic collisions involving vehicles, only 13 traffic collisions, so less a little

1527
03:49:36,520 --> 03:49:38,840
over 1% involved e-bikes.

1528
03:49:39,420 --> 03:49:41,460
Of that, to involve juvenile writers,

1529
03:49:42,040 --> 03:49:43,520
one of the juveniles was at fault.

1530
03:49:44,020 --> 03:49:45,780
And the other nine were adults.

1531
03:49:46,500 --> 03:49:47,980
I'm sorry, the other 11 were adults.

1532
03:49:48,420 --> 03:49:51,760
And out of those, nine of the writers were not at fault.

1533
03:49:52,400 --> 03:49:56,740
So we don't believe that we have an excessive issue

1534
03:49:56,740 --> 03:49:59,780
of people driving too crazy on these electronic bikes

1535
03:50:00,600 --> 03:50:04,980
and the adult collisions outnumber the juvenile collisions

1536
03:50:04,980 --> 03:50:05,740
significantly.

1537
03:50:05,740 --> 03:50:12,880
We believe that the vehicle code that we utilize now for enforcement is sufficient, but we're happy to have further discussions.

1538
03:50:16,370 --> 03:50:19,650
Would you believe that this could be a good primitives strike or

1539
03:50:19,650 --> 03:50:25,350
Pramption or we're good with the statistics that you presented were good

1540
03:50:25,350 --> 03:50:28,630
Just relying on enforcement in the vehicle code.

1541
03:50:28,930 --> 03:50:32,270
Yeah, I think we could take a closer look and revisit the statistics.

1542
03:50:32,410 --> 03:50:37,350
What's happened since April because they are becoming more prolific and then I could have a better recommendation for council.

1543
03:50:39,670 --> 03:50:45,830
It's really an assessment of how are these things being used and in most cases it's already covered in the vehicle code.

1544
03:50:46,470 --> 03:50:46,590
Okay.

1545
03:50:47,990 --> 03:50:49,050
Well, thank you too.

1546
03:50:49,230 --> 03:50:57,970
I mean, I think the challenge is, you know, is to the statistics looks good.

1547
03:50:58,410 --> 03:51:03,350
But a few of the residents that came to me, that's why I brought this up.

1548
03:51:03,350 --> 03:51:12,950
it does not emerge. I mean, the statistics is different from the perception of some of the

1549
03:51:12,950 --> 03:51:17,310
residents and how do we address that? Is the challenge?

1550
03:51:18,550 --> 03:51:22,610
Yeah. Mr. Mayor, I'm sorry we're probably getting to that level of conversation that's

1551
03:51:22,610 --> 03:51:26,730
going to be a little bit too much for an items off agenda. The question really, this stage will

1552
03:51:26,730 --> 03:51:32,010
be, is this something Council wants coming back or add to the priority list to consider coming

1553
03:51:32,010 --> 03:51:37,810
back with potential action. Yes, please. Then we'll call for consensus. Council member Chua.

1554
03:51:39,090 --> 03:51:44,270
Hi. Council member Lam. All right. Council member Leanne. Hi. Vice Mayor Barbidio.

1555
03:51:44,830 --> 03:51:53,850
I am too. Thank you. All right. Thank you. And that is unanimous minus the absent Mayor Monteno for

1556
03:51:53,850 --> 03:51:55,130
moving this to the list.

1557
03:52:04,430 --> 03:52:10,470
Thank you and this meeting is adjourned.