Everybody ready?
Call the workshop to order. Appreciate all of you being here tonight.
Oh, there's Michelle. Would you please take the roll?
Mayor Turner. Here.
Councilmember String. Here.
Martinez Beltran. Here.
Borjele Liebers.
Of course we know, Dino will be here in a little while. And he's got some other commitments.
So she will be here shortly. Would you please declare the posting of the agenda?
Tonight's meeting agenda was really noticed and posted in accordance with government code 54954.2.
Very good. Now for public comment, this opportunity for public comment is for items that are not on the agenda.
If you would like to make comments on an item that is not, that is on the agenda, please wait until we get to that item to offer your comments.
Members of the public are entitled to address the City Council concerning any item within the Morgan Hill City Council's subject matter jurisdiction.
Public comments are limited to no more than three minutes.
Except for certain specific exceptions, the City Council has prohibited from discussing or taking action on an item not appearing on the posted agenda.
Public comment is intended for comments. Questions posted during or posed during the public comment are now generally answered.
If you have questions, please send them to City Clerk at ccpubliccommentatmorganhill.ca.gov.
Now I'd like to give you the next item to adopt the agenda.
second motion by councilmember spring second by councilmember martinez bell
trend all in favor aye and opposed there being none passes three zero and now for
the budget workshop again this is a and this is sort of a workshop setting so
it's less formal than we would normally have at a council meeting what I would
ask my colleagues to do is that during this presentation that we hold our
questions until the end of the presentation unless you have something
a clarifying question about what something means based on the presentation itself, and
then we'll get into questions and discussion at the end of this presentation.
If that's okay, then we'll go ahead and move forward, and I'll turn it over to Christina.
Yes.
Did you want to take public comment for items not on the agenda?
Of course.
I just read right through that and went right past it.
So with that being the case, thank you.
Thank you, Christina.
Any public comments?
I'm sorry, Michelle.
I'm looking for you, and there you are.
Any public comments?
Anybody interested in making public comment at this point?
I'll just clarify because this is a workshop.
When we take public comment, you can just raise your hand and we will run the speaker timer.
You can fill out a speaker card there on the table if you'd like,
but otherwise you can just raise your hand and we'll go through.
Okay. Well, we don't see any and so we'll go ahead and move on.
I'll turn it over to Christina.
Great. Good evening, Mayor, Council, my teammates and the community.
Tonight we are pleased to present to you our budget and so it is a biennial budget.
So we're bringing forward to you two years of the operating budget.
So to begin July 1st of this year.
And then on the capital side six years of capital improvement program.
And so with that I'm going to start the presentation and then I'll hand it over to DAP for certain sections
and then to Chris on the capital side.
All right. So just a quick overview. We're going to go through the budget process.
We're going to summarize the citywide budget. We'll talk about personnel.
And then we'll look at the general fund.
We'll spend some time on the city council budget, community funding,
and then the development services fund.
Please forgive me. I meant to let everyone know that we have a goal tonight
of trying to end the meeting by around 8 o'clock.
That's the goal. There's a lively spirited conversation, and we'll go beyond that. That's fine. But the goal is to shoot for about 8 o'clock.
Forgive me for interrupting. I just thought better make sure to get that out there.
Thank you. Thank you.
Then we'll look at our enterprise funds. And so for us, that means water and wastewater.
We'll look at our unfunded liabilities, and then we'll turn to capital.
And then next steps, and then the questions and answers, public comment, as well as council discussion.
So this is our timeline for our budget process, kicks off with the goal setting.
And then we're in the May area where we've recommended the budget to the council.
It was made available at the beginning of May.
And here we are with our budget workshop.
And then we'll be back next month for budget hearing and budget adoption.
And because we do a two-year budget in the second year, we'll come back in February
and we'll have our goal setting with our council.
And then rather than going through the process that we're going through right now,
Now we'll spend more time as a team validating the assumptions that went into preparing
this budget.
So looking at the revenue assumptions, looking at the expenditure assumptions, and then bringing
forward any sort of adjustments to council for consideration in May.
So back in February, the council looked and reviewed its sustainable Morton Hill document,
looked at the vision, and then also the ongoing priorities and the strategic priorities.
And so as far as the strategic priorities go, the council now has six.
and so the economic development priority, the council decided to add tourism and to
focus on tourism and bringing specifically more youth sports to Morgan Hill to drive
overnight sales and spending in our city.
In addition to that, council has a new strategic priority for the next two years
and that's healthy community.
Each of these strategic priorities have a pretty extensive definition.
The council has adopted and goes into the details of these.
These strategic priorities really set the framework for our budget,
and so we purposely meet with council in the community in February
as we're kicking off our budget process
so we can make sure that our budget is really trying to address
some of our strategic priorities.
So just jumping in, I want to spend a little bit of time
just talking about the concept of funds,
and so our general ledger system, our accounting system has many funds.
Most of the time when cities talk about funds,
they're talking about the general fund.
When you hear it written up in the paper,
whether it's the cities or state,
and it's because it's the most well-known
because the expenses going out, money being spent,
is what's most familiar to people like public safety.
Similarly, the money coming into the city
is what people most think of
of how we get our revenue, taxes.
Much of what comes into the general fund,
the council has discretion.
They can decide how to spend the funds.
That's not the case for every area and you'll see slides later where that will go in and
there's some examples.
For instance, we bring in recreation revenue.
We have to spend the money that comes in to offer the programs that we have at the CRC
and to participate and have membership services and so forth.
But most of the general fund is discretionary, so public safety, recreation, streets,
park maintenance, economic development, and administration.
Now, sort of contrary to that, many of our funds are non-discretionary.
So the funds come in, and they come in, you consider them intermarked, and so they have
specific purposes.
So if we just, for example, look at the bottom, enterprise funds, water and wastewater.
So we collect water and wastewater fees from our community, those that use our system,
and those rates are intended to cover the cost of the service of providing those
services to the city as well as to cover the cost of replacement over time
and so when the funds come in they're separated from other funds because they
have to be spent on water and wastewater and so looking at some of these
other areas we have development services that we'll look at planning
building land development engineering special revenue funds that's where our
gas taxes are and then capital project funds so think about projects like
streets and parks and storm drainage and public facilities.
Okay, so just in kind of setting the stage for this budget,
and if we were to look at this budget sort of high level,
well, what does this budget take into consideration?
So the first one is uncertainty of the economy.
You know, as you probably read different periodicals
and websites about where our economy is,
and there's some level of uncertainty
about whether or not there's going to be a recession.
And so this budget factors that in.
Next, slow revenue growth.
So we are seeing our property taxes and our sales tax and our hotel tax, for instance, going up,
but just as a slower rate than we have seen in years past.
On the expenditure side, one of the big factors in this budget is inflation.
And so that's felt by our residents, our business owners, and of course us as a city,
where just the escalation in costs for supplies and for services.
So this impacts our operations budget and of course our capital budget as well.
Another area, a theme for the budget is just increased costs related to personnel.
So that's salaries and benefits.
And then a big one is the increase in the cost of electricity.
Significant increase over the last few years.
But one of the positive things that I want to share,
and Chris will talk about this a little bit more is looking at additional solar projects
for the city.
And so those, if we go move forward with them, will save operational dollars, hundreds of
thousands of dollars in the future, and so reduce our operating costs for an investment
in those solar projects, and then an impact from higher interest rates.
A couple other areas.
So our budget does include staffing and operating costs for our third fire station that's
under construction on Butterfield.
you can now see that the work is now above the ground and you can see some of the framing starting.
Our budget also includes an additional two police officers, one officer in each year,
and that is something that we've been talking with the Council of Community about,
and it is built into and has been built into our forecast. In addition to that,
we continue to transfer one million in annual funding from our general fund
to our street maintenance and rehab program and that is to have better streets.
Our pavement condition index in Morgan Hill is at about 75 and that is quite honestly an
envy of many cities and so in order to keep that up we have to continue to invest in
our pavement rehab program and so not only do we need to use the gas tax dollars that
we receive but we're also recommending that the general fund continue to contribute
towards that.
And then the last area I want to mention is just our cautious approach to spending.
And this has been something that Morgan Hill has exercised over the years and it's just
conservative spending.
Just because something is in the budget doesn't mean we, you know, jump to spend the dollars.
And just one example might be from staffing, staffing.
So if we have a vacancy, it gives us an opportunity to look at our department to
and look at the needs of the city
before we run out and do a recruitment.
And so we're just cautious as we are spending our dollars.
This next slide is a recommended budget summary.
And so the big circles represent the totals
for each of the fiscal years,
fiscal year 24, 25, and 25, 26.
And then the smaller circles
represent the breakout between operations
as well as capital.
And so you could see in the second year
significantly more and that's due
to primarily capital costs.
This next chart, this is a little donut or bagel, whatever you prefer, so this is sources
of funds to our city, so this is money coming in, so this is all funds, but it breaks it
out by fund just to show that the general fund piece is large, but it's not the largest
piece.
Enterprise funds, you could see there's 35%, and then it breaks out the other fund types.
And then this next slide shows the expenditure. So dollars leaving the city, the use of funds,
and this is arranged by type of expenditure. So we have project expenditures,
employee services, supplies, and services, and so forth. So just touching on personnel,
this is the org chart for the city. And so at the very top, of course,
is the citizens who we are accountable to. The council is elected by the citizens,
and the council appoints two positions, one is the city attorney and one is the city manager
and then underneath you'll see each of our different departments, all of which are represented
here this evening.
So I want to just spend a moment to go through these enhancements.
These were introduced last week at our budget introduction.
So these enhancements are already built into our recommended budget.
So they're already included in the numbers, and our team recommends each of these different
items.
You'll see most of the costs are related to public safety, and we do have some positions
that are funded by outside sources or non-general fund sources.
And so the first has the two police officers I mentioned, the next is a maintenance worker
funded by Recology's Implementation Fund, and this is in response to SB1383 work
that has to be done. Staffing for a third fire station, adding a part of an FTE both in the
city attorney's office. They'll be offset by other expenditures as well as an administrative
analyst in my department. And then also the last two are reclassifications.
On the non-general fund side, we do have
Several positions that we're recommending in the utilities area. The first is accounting assistant,
and then a technology specialist, a public services facility security coordinator in the second year.
And then we have two positions in development services. We are looking at right now we are in
the middle of a fee analysis. And so depending upon the fee analysis, we're looking at
recommending two positions. One is a building fire inspector and the other is a management
analyst. And then the last three items are reclassifications of positions. And this last
chart here on personnel shows just a history of our full-time equivalents, and so you can
see the dip there that happened during COVID and then a gradual buildup.
And now I'm
going to turn it over to Dat Nguyen, our finance director.
Thank you, Christina. Good evening to the mayor and council members and for the
My name is Dak Nguyen, Finance Director, and I will continue with the presentation today
with the overview of the Journal of Fund.
As Chris mentioned, Journal of Fund is the one that most of the funds sources are discretionary
that the council have the option to how they want to allocate those resources to, even
though how limited they are.
And overall, the recommended budget for next year, next fiscal year, 2014-2005 of $62
The breakdown of the sources funds include majority of that is the property tax.
The second largest segment of the tax revenue is the sale tax and followed up with the 50%
by the just recurrent services, mostly from the recreation membership.
Going to detail of the major source of funds for China Fund, the first one is mentioned,
the property tax.
We anticipate property tax to be next year to increase by 6%.
This is, even though it's considered high compared to what we allow under the Prop 2013,
however, this is lower compared to a per year that we have experienced.
For the second year, we anticipate due to a low interest rate environment,
the poverty tax probably increased by 7% to 20.8%.
And these rate increases are consistent with historical trends that we have experienced.
And the second largest segment of the sources to know from is of course cell tax.
Opposite with the public tax, cell tax will anticipate the rates growth is much lower than we had experienced in past.
Less than 3% for the next two years for 12, 425 next years could become at $12.9 million and for $25.26 of $13.3 million.
And just want to make a note to residents that even though when we pay the sale tax on anything,
we purchase with goods about 9.125%, the seeds will collect about 1% of that.
So if you pay one dollar in the sale tax, the seed will collect about 10 cents.
Another large turnover segment is, of course, the DOT.
TOT, we expect about $2.7 million and $2 million in the second year.
The city does not anticipate the TOT coming at the pre-pandemic level of 2019 until the
second year of 2526.
The COVID-19 pandemic really hit the tourism industry really hard and that's growing
rate in this tax segment is clearly going back to the pre-level in the second year of the
recommended budget.
And the third largest segment of the general fund revenue is, of course, the Recreation
Services.
The common is about $10.6 million for next year and $8.3 million in the second year.
Down on that previous slide, can you tell me what hotels are included in that TOT tax
for 2526 and 20 for that 3 million. Does that include the downtown hotel? Yes in
the second year the upper-ranked 2536 does include the opening of the
boutique hotel downtown. Okay and how much should that be?
We anticipate
coming about 200,000 or that for that particular revenue for that hotel
come in the second year. So the net of 2.7 and 2 million is 200 which is from the hotel,
particular hotel, and the different 100,000 is from the organic growth from the existing hotel.
And 100,000 is for?
Organic growth from the existing hotel.
Got it. Okay.
Real quickly.
So everything isn't even included in this?
What we're wanting to do is get, if it's a clarifying question.
for this particular slide and the dollars that are listed on here all right so can
you tell me about the Evergreen hotel is that that's right here okay okay thank
you as I mentioned the recreation services includes membership and rental
fees and this is the second third largest revenue category for a channel
fund and they come in about seven that works expected to come in 7.6 million
dollars in the next year and 8.3 million dollars in the second year same thing
COT or creation membership fees and had been hit hard by the COVID-19 pandemic. And we do not
anticipate that coming to pre-primary level in the $2425,000 and $7.6 million. Even though the
revenue coming at the about where anticipated coming at the 2019 level, but of course we
all know that expenditures have been out close ever since.
Mayor, I have another question. Do you want me to wait? I can wait.
Again, if it's a clarifying question, fine, but if it goes into a deeper conversation,
I prefer to wait until the end if you would.
I'm wanting to know what portion of that 7.6 and 8.3 is for facility rentals versus recreation
and facility rentals.
That's fine.
Yeah.
Okay.
And of course, this infamous chart that we're not proud of, but somehow we're also
proud of. And a lot of you have seen this chart and we try to show this chart to our
residents at AF2NU Get. This included at the budget development process, as well as in
the budget development, I mean budget document, and the audit financial statement that we
have in the website. This really tells us that, you know, Mobile Hill is the base
on per capita revenue-wise to see the C-collect the lowest in accounting.
And in the cost-bonding email between one of the officers that were acknowledged of
the city's activities, he mentioned that, you know, this is something that we typically
mentioned it, but let me fully explain why.
Well, this is why, you know.
All the communities, I would say, half of the cities in the county have some sort of additional
tax measures of revenue, and majority of that is from UT or UT of tax.
Just like the URoy example, because we left it compared to our neighbors, URoy, UUT tax
with 5% last year to about $6.7 million dollars and imagine that if we had that
usually right here a lot of stuff we can do here and I mean in a short time I'm
here not a very short time but now years I'm here we have tried you know
engaged our communities but from my personal experience I think we all know
that our community is very tax adverse I mean I don't plan them I'm you know
who wants to pay taxes.
Raise your hand if you want to pay taxes.
But despite having lowest tax revenue per captain in the county,
Morgan Hill is one of the safest cities in the county and state.
Right? And that's to tell you, even though we have,
so I've seen officers in the room tonight,
they tell you that we're probably at the lowest,
It's not the lowest officer per 1,000 residents.
Why? Because they probably put a 110% effort compared to other cities' officers.
For recreation, we have the highest recovery rate, if not the highest in the country,
at about 85%.
And we had roast at a PCI rate of 75.
So the roasts are well maintained.
Not only that, the CD's got rating from S&P is AAA.
And it's something we should be very proud about.
This chart is the, when we talk about the railway
from China Fund, this chart talks about
the China Fund expenditures.
This is only the discretionary expenditure
for China Fund, about $47.1 million.
We know that our appropriation of revenue sources about $62 million, but net of the non-discretionary.
The most non-discretionary includes membership fees that we collect for recurring services, gas tax for street and maintenance,
so the net about $47.1 million.
This is the dollar-mile interim fund that the council actually had discretion how to allocate the resources.
As you can see in this chart, public safety include fire and police occupies about 100%
of the chart and parks and recreation at 2% and 4% respectively.
Journal of government and support would pay me myself about 11%.
To recap, the Journal of Fund, as Crystal mentioned, this is really a start-to-go
budget.
budget, we're not adding anything fancy or anything new to the budget, except that the
two police officers and the funding of the third fire station that we've been building
the budget for quite a while now.
And the budget also includes the cost of the increased cost of personnel and the inflation
on supply and services.
Also, I want to reiterate that in the budget, we anticipate we build a budget with
no current increase after 2026.
that may not be realistic, but this is something that's built in the budget.
And no additional revenue source or stream that will be in the budget.
Something that we have to work on.
And as I mentioned by Christina, we do approach our expenditures cautiously.
And I'll try to show you that the tournament fund reserve forecast has occurred right now
and in our years from six years from now.
The good thing about on the cities finances is that we start out on a high level but without
any additional real estate stream or anything controlling expenditures, we anticipate that
Children Fund Reserve, which dropped out to the minimum level in the fiscal year 2930.
So, as I mentioned, the budget assumed no silo adjustment after 2026.
Is that realistic?
So basically in order to maintain or even enhance our level service,
we had to work on, you know, engage our community for possible bond and tax measures
or work with the industries or companies or developers
to try to bring in the development that produced
high-tax revenues for the city.
Next up is something that we will discuss later tonight
is the city council budget.
For the city council budget, we put in both personnel
and non-personnel of about half a million dollars
and $540,000 in the second year.
Of the half a million dollars budget in the current year,
we also put in $200,000 for community funding.
This level of funding is consistent
within the past few years.
And for community funding,
we received 28 applications
and a total request of about $408,000.
Something that we can discuss further
at late tonight meeting.
And there's several options that staff are recommending,
but the first option is something that staff recommend
just based on the existing level of funding
that we had in the past.
Moving
on to the next major fund in the city, of course the environment services fund, better
known as Fund 206. The interest rates, you know, the high interest rate environment really
impacted our ability for development to keep the project going. One of the projects that
really impacted, of course, that you, as a council member, Yvonne Martinez-Bertrand
mentioned is the hotel in Evergreen. In the past years, we anticipate that project
That could be put out already, but I'm very sure because of the interest rate that could
not finance, that project is going to not be in a budget.
The fund also anticipates a short-term internal fund loan of $1 million from the general
fund in current fiscal year and the fund because of some of the services that the
supplemented by the different services staff. Some of those services that we
collect fees including counter services as well as certain fees that connect
not collected at 100 percent on the cost. One example of those is the trade
removal based on prior study. The cost of permit for the trade removal over
attached to ours, but we, we, um, tragically, uh, only charge, uh, uh,
You're about $100 because you want to communities work with us in more compliance way.
As I was going to mention, we look forward to bringing to the just a free schedule to
the council to consider in sometimes next few months.
And the automation funds that we have in the budget is of course the enterprise funds.
The last time the council approved the water rate for five years was back in 2022.
So this five year rate plan should be good to the fiscal year 26, 27.
And currently we are going through the waste wire rate study.
And one option that we really council to consider is to have a flat fixed rate for the residential
and additional monthly charged fees for 80 years.
The flat fixed rate is very consistent with our labor cities in the north,
that run in the south. They currently do not charge a fixed mixture of fixed charge and
variable rates for students. As we can do right now, most of the cities in the state charge
them flat fixed rates. That's something we can bring the council to consider.
This
charge really serves the good, the water conservation effort done by our communities.
We start out, you know, pay a high consumption in fiscal, in the current year, in the economy 2013,
even though with the population of about 40,000.
And now, 10 years from now, we have a population over 45,
but our wild consumption is much less than we had in 10 years ago.
Unfair liabilities.
The major unfair liabilities for the journal funds is, of course, the pension,
of the $70.9 million in unfunded liabilities, CalPERS has $68.1 million, and the other one
is post-employment benefits of $2.8 million.
One thing to make note is that the general fund share of the unfunded liability is about
two-thirds.
Of two-thirds of the $70.9 million, it's about $47.5 million.
And here it sees pension plan occur in front of status.
we are compared to all the cities in the county. We are a little bit above average
and compared to a capital system, why? We are right at the average. One thing was
noted here that of the existing headcount from the cities of 193, 55% of
that is the pet park members. Those who came in after July 1st 2013, those
members that receive much lower, lower generous pension rates than the classic
members those who hire before 2013. As we continue to progress and staff
turn over and more staff will come in at the lower rate plan than the classic
members that will help the city's cost for pension in our years.
It's
something that I believe not every community member is aware, and it's something that none
of the city and county that I'm aware of that has the employee's share of the employer post
rate.
Everyone in this room right here, whether you're a class member or a miscellaneous
member in the PEPRA or a classic, share 6.1 percent of the employer's post rate.
So if anyone going to the city website at your website and want to figure out my how much I get paid make sure you deduct 6.12 percent and
for the other unfunded needs operation operation needs, of course and not be able to budget additional police officers and
potential
funding opening or building of four five station as community continue to grow and
other unfunded needs operation why is public safety?
right now the car the
Fire department staff operate one fire drug and two fire entrants, and those are over 10 years old,
and they need to be replaced in a short period of time.
And those drugs and those entrants are not cheap.
The one we just purchased, put in order for the third fire station costs about $1 million,
and that's before our field of handling equipment.
And the other major unfiltered operation needs is, of course, the electrification of the SEA fleet.
It's something required by the state that we have to move on, move to EVs, electric vehicles
instead of the internal combustion vehicles.
And other unfurling needs, of course, the loss of the funding from the residential development
control system that we used to have before is RDCS that pay for parking and street maintenance.
We don't have that anymore.
So there's a really, there's a really neat, a new room stream needed to fund those kind of maintenance operations.
And of course, as we Mogen Hill communities grow older, there should be more funding, should be allocated to this service as well.
Option for future consideration.
I think we should tackle expenditures first because based, as I mentioned, and Crystal mentioned in the budget,
We do not foresee in the budget, we do not build in any cost-living adjustment after
2016 and we all know that we are really unrealistic and so something has to be done and of course
something we will continue to focus on and continue to do every time opportunity we have
is look at the positions if it is really needed and as well as if something that
The road is the economy turns out or worse than we had forecasted here.
Some highs and frees or program services reduction may be an option.
And on the rural side, of course, we always want to increase our top-line number, one
of which is, of course, we could work with the council and communities to have – to
institute some kind of program on the centers to encourage high-producing tax development
to the city and put to a balance of tax measures.
And that concludes my operation and I'll turn it over to Chris for the CIP.
The
plan is for Chris to go through capital and then the mayor will see if the council
has any clarifying questions and then we'll open up for public comment.
So I'm going to go through these slides pretty briefly as I know you're limited on time
so I'm not gonna go through every single project.
Just give you a summary, but we have details
on every single project if you wanna come back.
Before I jump to that, I'll answer,
Council Member Martinez Beltran's question
for the facility rentals, it's 1.2 million.
So the Capital Improvement Program,
we've divided into six sections,
and that's our parks and recreation,
public facilities, streets and roads,
the enterprise funds, areas of wastewater and water,
and our storm drainage system.
So the CIP program is really a six-year program that you see in front of you.
The appropriation that the council is making through this process will be the first two years.
So as you get farther out into the six-year program,
it's more speculative on the revenues that are coming in to support the projects.
So we plan farther in advance using our master plans and the CIP,
but we're really appropriating for the first two years.
The, really, our guiding principles, we have to have money to pay for these projects.
We could for sure do a lot more things that we'd want to do, but you have to have the
funds to do it.
We need to be consistent with our general plan, and then we have specific infrastructure
master plans that we try to align with.
We also want to make sure projects are aligned with the council's priorities, but
also there may be some projects that might not be a council priority, but they're
mandated by the state that we complete.
So we do those things as well.
Grant funding, we don't get to choose
the grant funding that's available to us.
So we need to be flexible and look for that.
So if there's projects that we have to
put together to meet grant funding, we do that.
And then a big one is when we can use the CIP
to address maintenance or deficiency issues.
We do that and we always consider
the long-term maintenance and operations
of those projects that we build.
And finally, a lot of the community input
comes through the development of these master plans.
So just talking about that,
just an outline of what we're thinking
on the CIP side for infrastructure planning
and as outlined in the CIP,
we are working on the transportation master plan
as the council's aware.
Just council just approved the sewer system master plan. And then in 2025 we'd like to commence an update to the parks and recreation trails master plan 2026 storm system master plan.
And then 2027 we will be due again for our water system master plan update, which we try and do every five years or so for both water and wastewater.
This is just an outline of the six-year period and what we're spending by area.
It's also in your packet.
So over 60 million in the first year of the CIP and over 108 million in the second year.
You'll see wastewater as a major portion of this, and that is due to a single project
which has been planned for many, many years.
And that is a trunk line to take our wastewater to the treatment plant in Gilroy.
The Parks and Recreation CIP just want to outline the funding sources and on the left and for
all the areas that have outlined where we can spend money on new and expanded facilities
and where we can spend money on maintenance and what those funding sources are.
As you'll see as we go through these in the non-enterprise fund areas, we do not have
a lot of money for maintenance and renovation.
We have a little bit from Quimby funds
that we can use for renovation.
They're allowed for that purpose for parks and recreation.
And we have nine projects in the parks and recreation area
in our public facilities.
So those are kind of our buildings
that are outside of Parks and Rec or our utility system.
We really have no CIP funding for maintenance
and renovation.
So we're looking at grant funding on things we want to do.
We have money for expansion based on impact fees for the various areas there.
We have five projects that are outlined in the CIP, which include pretty much all the
facilities, which would be that are not recreation or utility based.
And those include some of the solar components that Christina was talking about earlier.
Our storm drain system, so this is not a utility system.
This is funded operations maintenance primarily through the general fund.
We do have some dollars for some minor capital improvements for renovation of our storm
drain system that is tied to the implementation funds Christina talked about to meet the
1383 or trash capture requirements in our storm drain system and we have five
projects outlined in the storm system area including some significant grant
funding for the Fisher-Butterfield storm system expansion. Our CIP for roads and
streets we do actually have funds for renovations of our streets and those
the 2016 measure B that give us a considerable amount of money to put towards street rehab.
We do have some funds, undergrounding fund and our public facilities fund which we've
done for repairs that do not collect a lot of money or in the case of the public facilities
fund that those are remnant RDCS funds and we will expend those and not have anything
to replace them as that mentioned earlier.
Yes, we've budgeted through the six-year CIP, but likely in six to seven years we will
not have that fund anymore unless there's a different funding source that comes into
place that are provided dollars in there.
So in this area, we do have several projects.
Talk about one of them as a highlighted project in a moment, and we do have some flexibility
because we're waiting to finish the transportation master plan
before we outline some of the projects for the longer term.
So that transportation master plan project area
is more of a placeholder until we finish that plan.
On the wastewater side, we have really two funding sources
if we don't have grant funds, which sometimes we do.
But those are impact fees for growth related to our sewer system,
related to new development and funds for maintenance
or renovation capital projects,
which come from our rate payers.
And we have a significant number of projects here.
The treatment plant project is nearing completion
in Gilroy, which we pay a portion of out of our CIP.
And I will talk about the trunk line project in a moment.
Our water CIP is exactly the same as the sewer CIP,
except it's water instead of sewer,
but same funding model, and we do have a significant number of water projects both on the expansion
side as well as the maintenance and renovation side. So I want to just breathe through some
highlighted projects mentioned the sewer trunk line, so the
Project planning is underway. We're completing acquisition of easements and design. We have encroachment
permits from Caltrans and the county and we'll have them from the city of Gilroy very shortly.
And then we will be finishing the final design this year and then we will be looking to finance
this project and the financing plan will come later this year and then we'll be looking
to commence this project next in the summer of next calendar year. Butterfield Park project,
this is a project that the council has reviewed plans on. So we are just finishing design here
and should be out to bid on this project and hopefully likely be back to the council after
summer to propose funding and constructing this project.
Chris, is that, the sewer trough line, is that funded?
It is funded, and it will be, and it will be discussed, the financing will be discussed
and the funding will be with, is, will be discussed as we bring forward the rate study that
that mentioned as well.
Oh, okay.
Yeah.
We don't have all the money, but we've never planned to have all the money up front
because future residents will also be paying into the future.
And then, Payment Rehab.
Christina already mentioned that we're at 75 PCI,
which is our overall payment conditioning index.
I will note that it's set from 71 in 2018.
Talked about funding sources already.
This is a cool graphic that shows you
which streets are in good condition at-risk, poor, and failing condition, which shows we're doing okay,
as Kristina mentioned, across the county. We're doing pretty well. We have a 2024 project which
will be, we've already talked about what's in that project with the council, but the 2025
project will be a big one because we have $4 million in grant funding that will be added
for rehabbing Monterey Road and actually making improvements to that Monterey Road as well.
Just a couple other quick ones I wanted to highlight that we are investing dollars on
the maintenance and renovation of our aging infrastructure and this includes our Water
Main Repair Program that we, through the six-year CIP, will be investing depending
spending on the year, $1 to $3 million annually to replace aging water lines within our system.
And then with our sewer system and repair program, we'd be investing $2.5 million annually on system repairs.
And I'll note we now have complete video of every sewer line in the city and
an assessment of the entire sewer system.
And in both cases of those, we coordinate with our pavement rehab program to ensure that we aren't
be digging up brand new payment when we're doing that work.
And then just lastly, Christina already mentioned,
we are kicking butt on our fire station
and we should be having that complete
by the end of this year.
And I'll just mention that the commission,
the Parks and Recreation recommended approval
by the council of the proposed Parks and Rec CIP
and the planning commission found the proposed CIP
consistent with the general plan.
And I will quickly run through what we don't have in the CIP.
Our pavement assessment indicates we need about another million dollars annually on average
to maintain our PCI at 75.
We do not have significant dollars for traffic safety improvements and there's no funding
source identified for that.
We are looking to provide proposals on what we may be able to do with that as we complete
the transportation master plan.
And we are currently undergoing a sidewalk assessment.
So we think there are going to be some additional needs for a sidewalk rehab above what we
have in the budget, but we aren't sure that we'll come back when we have that assessment
completed.
And then lots of visionary things within our parks and recreation master plan and
And other master plans that we'd like to see including sports facilities, the full build
out of the Villa Merrimonte facility corporation yard, build out for the future hot EOC that
we've talked about and expansion to the Centennial Recreation Center, Senior Center to meet needs
of older adults.
Those are not in the six-year CIP.
And I will give it back over to Christina.
Thank
you, Chris. Okay, so as far as next steps goes and just looking at what we've done so May 11th
We were out at open streets engaging with our community last week
We introduced the budget tonight our workshop and then on the 19th
We have our public hearing and budget adoption
So now what I recommend we do is I'll turn it back over to the mayor for just clarifying
Questions and answers we open it up to the public for public comment and then back to the council for questions and discussion
And then what we'll do is we'll put up the community funding slide as well as the council budget and then engage on discussion items on those.
Okay. So what we can do with that is, again, mostly clarifying questions here.
We get into deeper questions about concerns or issues that the council has after public comment as well.
So any questions to begin with?
Since it's informal, Renee?
Thank you.
So I don't know if those are clarifying questions, but you know, I had a chat with the city manager a few days ago about, you know, kind of working through what if scenarios, right?
Instead of just rubber stamping what's in front of us, right, I'd like to see some variations to kind of say, well, do we want to go left, right and middle?
Which one of the three is it versus just saying this is it?
But there might be different ways of looking at certain aspects of this.
So I don't know if those are clarifying questions, or if you want to have those.
Please go ahead.
Yeah, you can do it.
Go for it.
May I?
Yes, please.
So Council Member Spring has asked us to look at some different scenarios.
And so during the discussion piece of it, we can – and Monaca has the General Fund
Reserve Chart, and so we can do different scenarios.
Now, you know, as we sort of started the discussion of the budget, it is a status quo budget.
And so more of the scenarios come into play, you know, if we needed to, say, reduce expenditures
and we had to, you know, cover a gap, then, you know, we would bring, you know, recommendations to the council
or, say, if we were going to have additional revenue from a measure otherwise, you know,
then there would be sort of what if scenarios.
But what we can do this evening is, for instance, if you wanted to look at what would it take,
What would it look like to add something and so we can quantify that and then show what that does to the to the chart
So we can definitely do that. So we would that now or discussion. Yeah, okay
The way but you'd prefer it for that I'm fine with that to be okay, but I'll ask it
well, I
collect me if I'm heading down wrong but but for example the
sales tax revenue, right? I think the increase is going to be minor, not even half a million,
right, between the two periods that we look at. That's a very low amount, right? The increase.
That's correct. That's correct. Why is it so low? I thought we're doing such a fantastic job
with bringing businesses and buildings into town, and then we're barely getting half a million
of sales tax additionally?
We did actually, the forecast bill in here is very much based on the data and the macro
environment as well as working with our sales tax consultant.
They anticipate that based on the existing tax base we have here,
it could come in at less than 3% growth in the next few years.
Again, you correct that, you know, why we see a lot of all men, but not a lot of general
rate.
It just has to do with the economic environment, you know, as a consumer, like myself and you
are, we are anxious, right?
We all feel the pinch of the high cost of almost everything and higher interest rates.
So based on those data and working with consultants and this is what we have and so far it has been very accurate.
We did come out with a, we call it quote unquote pandemic high, but right now we're more like back to reality level.
But do those numbers do they factor in or maybe or not yet any of the new
businesses that we talked about over the past year like some of those fast food
restaurants that we talked about and then there's at least two of them right
in the pipeline a fairly big ones and well-known ones and and those this
businesses that we're hoping to come in including car dealerships is any of
Is that factored in or are you to say no because they're not up and running, we don't factor
any of it in?
Yes.
For the one we know, under construction, yes, we communicate those information to our self-sac
consultant and they build those in.
But for the one that we wish to have, like the fourth dealership or the fifth dealership,
no, they're not in there.
Okay.
So it's fairly conservatively butchered it.
Is that fair to say?
I would categorize as conservative, I would categorize at the current level, realistic level.
Realistic, okay. Yeah, I take that.
Yeah,
I have more comments than specific questions, so I'll wait until later on. Thank you.
Thank you, Rene.
Yvonne?
Yeah. I also should, the sentiments, but I'll start with unfunded liabilities. On page
47 that you were showing here, PD officers, fourth fire station, public safety equipment,
can you quantify those for us? Because they're listed here. There's no, there's, you know,
nothing is attached to that.
So I'll go ahead and go to that slide right now. And so these are sort of in response
councilmember spring request from the budget introduction about you know bringing forward given more revenue what how would we you know
What would we fund?
And so that's why we've listed those here
So as the city continues to grow looking at potentially a fourth fire station
Looking at additional public safety officers in the future
We're not recommending them right now but given more funding. These are needs that that are out there in addition to that
Public Safety Equipment, so that's to cover a fourth station to cover additional officers and then to put aside more money each year
for equipment replacement.
So that's sort of the flavor. We don't have dollars ready to share with you this evening.
I mean, we can come up with ballpark numbers, but these this is just to give you an idea given more revenue.
What how would we look and how would we recommend that that additional revenue be spent?
But I mean, I appreciate this list.
I actually had hoped and expected that this would be part of it because we've had unfunded
liabilities listed in prior budgets.
So I would love to see this, you know, in this budget, when we come back in June, I
would love to see this going forward in all budgets that we have.
It's difficult when, especially in the position that we're in, and we're all facing, you
It's difficult to look at a budget and look at approving it when we have to also look
down the road and think about what it is, what are the needs that we're going to be
facing.
And so I think this is really informative to tell us.
And while I understand future public safety needs help, I need to understand how many
officers do we need.
When I understand that we have a fourth legislation to keep pace with the population growth, I
need to understand what is that final station, what are we looking at for the land and to
build it and for the staffing that we're going to need.
Public safety equipment, what is it that we're currently doing a transfer of whatever
savings that we get, we're having an automatic transfer that are going to certain identified
funds, and so for me, I need to know, what does that mean?
You know, it's difficult to do and to think comprehensively about the health of the city
and where we're going without having kind of any of these indicators increased older adult
senior services.
Does that mean that our senior facility is, you know, is having trouble and the programs
there?
Does that mean that we anticipate that we're going to have an inflexible older seniors
coming in?
Is that just talking about the existing residents that we have so if I think if we could quantify this it would make it
easier to
understand
You know what we're looking at. I would love to see and find the
Liabilities for every department to be outlined for us in the future. Yes, so all good, you know
Questions and thoughts about these different items. I want to make it clear that I wouldn't call each of these liabilities
Right, so this is in response to councilmember spring's request of given more funding in the future
What would you look to bring forward as recommendations?
And so we've built in the recommended budget for the next two years what we're recommending to
In most cases maintain the level of service that we're currently providing to our community
So for instance on police where we're recommending one additional officer each year
to complement what we already have to meet service levels that are.
Now, there are a lot of variables that will impact how many officers in the future will be
recommending things like technology. So our chief has brought forward excellent recommendations
over the past several years about using technology to complement our staffing to provide service
to our community, flock cameras, for instance,
tied in technology with body cams and reporting
that help our officers.
So how our population grows,
how our needs change over the years
is gonna factor into that first bullet.
Our fourth fire station,
we need to get our third fire station up and running,
move that squad from El Toro to Butterfield
and then look at, okay, how is this helping?
What are we seeing with response times and so forth?
And so these are things that our teams are continuing to look at, and we'll be making
recommendations in the future for the out years.
So that's how I would sort of address that now in the last bullet, for instance.
This is, once again, in response to the question of, given more funding, what would
you do?
Yes, we do.
We are seeing that we have an aging population, and given more funding, you know, Chris
and his team would love to offer more programs in the future, you know, so
So that's a flavor of some of the things that we would add.
I would just love to get some price tags on these.
It's difficult to shop or to break your shopping habit.
Yeah.
If you don't have price tags, and you think it would be very helpful whether or not
they are needs, wants, if we could get a price tag on these, I would appreciate that
for June, and I would appreciate that for every year going forward in the budget.
And I think that would inform the council as much as maybe the staff is familiar in being
in the budget and understanding, you know, where the funds are going and transfers are
going.
That would help me.
I'll speak for me.
I'm going to weigh in on that real quick, since it is conversational we're going to
be a little less formal.
I have concerns about that because what we don't know, again, what we're talking
about here, this is if we have additional funds, those additional funds could range
anywhere from $1,000 to $5 million.
We don't know what that's going to look like.
I don't like the idea of sending staff back to start to crunch numbers on things.
We don't even have money for.
Once we have the money, we can put together what the cost and price tags are
for what staff might come forward and say,
let's say we've got an additional $500,000.
They might come back and say, this is what we recommend.
Here's the price tag for these things.
I don't think it's worth their time.
I'm not saying what you're asking for is not necessary,
But I don't think it's worth the time to try to put price tags on things that we don't
even have money for.
And my concern is for the amount of time they've already spent on this, the amount of time
they're going to continue to work on bringing this forward for final approval.
I just don't think it's, I don't know, I don't know that it's worth going through
that exercise.
It could be something maybe after the approval because we don't need those numbers
for the approval, but these are numbers that could be helpful if down the road
would we find we've got extra money.
So I would say if we're gonna ask the staff to do that,
let's not put it on their plate to do it
before the June approval,
because we can approve it without those numbers.
Sure, again, I would prefer to have that.
For example, public safety and police officers,
we have one because we are limited,
but I can tell you right now we need more than one.
Absolutely right now we need that more.
But we don't have the money for it right now.
Well, maybe we need to go and look and figure out where that money is.
But we would do that in the budget, the proposed budget, not with what we hope is future additional revenue.
Mayor, we're looking at the proposed budget now, and that's why I'm asking for that information now.
That's what I'm saying. This is our unfunded needs for the future if we have additional funding, is all I'm saying.
We have a budget we can work with and move money around, but it doesn't affect any of that.
No, but it would be great to know what those, how many do we need future public safety needs,
how many do we need right now at the present stance that we're at.
Yes, we can afford one and we're asking for one, how many do we need.
I agree, but we don't need to do that to approve the budget.
That isn't necessary.
Okay, we'll just have to disagree.
I would like to have this to approve the budget so that I could understand what the unfunded liabilities are
as we've had the past five years that I've been on the council.
This is the year we don't have it, but that's something information I have.
Well, you can request it. We'll talk about it.
And we'll give staff direction based on council input.
Correct.
Yeah. Okay. Very good. Next.
Any other clarifying questions?
Okay, Mr. Mayor, do you want to open it up to public?
Yes, I do have a question.
And on the, going back to the TOT on the, you've indicated it's two new hotels you're
talking about?
Or one in particular?
One.
And now 300,000.
I was just wondering, how did you come up with that $300,000?
It's just based on the average TOT to generate from each hotel we have in the existing
and in stocks.
Got it.
Okay.
It's just come up.
Okay.
200,000.
And then the other 100,000 is just assuming growth in the existing hotels.
Got it.
Oh, got it.
Okay, very good.
Okay. If there are no other clarifying questions, we will open it to the public for comments.
Michelle, let you manage that there.
Who wants to go first?
Roger?
I'm
going to start with a 10-second lead-up, but it totals three minutes, so it'll count down.
Roger, three minutes.
Is this on? It's on.
Well, I do not envy you.
This is a great exercise, and it's very informative for me.
I apologize for even taking three minutes of your time.
However, good evening, Honorable Mayor, members of the Council, and supporting staff.
I'm Roger Knopf, President of Morgan Hill Historical Society, speaking on behalf of our board,
our members, our faithful contributors, and especially our great volunteers.
years. We support two requests for funding a Velomiramonte facility maintenance, Velomiramonte
being our community history park. The first request is for the $20,000 grant that has
been recurring for the past six plus years. The second is for $15,000 to be funded from
the 2024-25 community fund, which was applied for last week by us.
The rationale for both requests is reflected in the letter of request and statement of
operations submitted last week.
None of the requested funds from the two grants will be used to fund the society's
operation or any of its events or activities.
The funds will be used exclusively for the maintenance of Villa Maramonte, our community's history park,
which consists of two and a half acres, the 1884 Hiram Morgan Hill House,
the 1911 Acton Farmhouse serving as the community museum,
the 2006 Centennial Trail, the Poppy Jasper patio,
native garden, and the beautiful rose gardens. Management and supervision of
Velomir Monty maintenance is provided by society volunteers at no cost to the
city.
A biased comment now, if we were the official scorekeeper at this game
regarding the nine council goals, and that was interesting to see your goals
and priorities projected up here earlier. We would say we had a homeroom on number seven,
goal number seven, a solid hits on one, two, three, four, and five, with fielders' choices on six,
eight, and nine. Further on the strategic priorities for 24-25, we score well on priority one,
1, 3, 4 and 6. We therefore believe the citizens receive great benefit through positive council
actions on these requests. Thank you for your consideration.
Thank you, Reiner.
Thank you, Michelle. I'm assuming we get another comment on community funding because
that was a community funding thing. I'm Doug Muirhead. I live in Borgen Hill. Good evening,
mayor, council members, city staff, guests.
On the end for the needs, I don't know how you're going to work out how you want to go
forward but I was very pleased to see that we are officially thinking about what might
be increased older adult services needs as our population advances.
I've tried to bring this up in the past so I'm really pleased to see that making
any kind of list. I also, under healthy communities, I did not hear anything as you discussed different
staffing options about our unhoused specialist, but I did get a response to a question that
I raised from the city manager when I said, you have grant funding through the end of
the year for Brian. Does it end then or do we get to keep him? And she said, we will
funding him longer. So I think that's just really great news. He's an outstanding person,
very unique background, very specialized clientele. So that's a good thing. I'd like to say
a couple of words about how we might think about doing public outreach on events like
our public works days. I enjoyed going to ours this morning. I then spent an hour
down in Gilroy with theirs. They're similar a little bigger. They put their people under
tents and they have little passports for the kids to get stamps. And one of the things we
don't weren't able to do, I saw one child this morning, is it's not good timing for
the school kids. So maybe afternoons, but there was some concern that, you know, with
the work hours of the staff, we might have to pay overtime. I also think maybe a
location other than the Corp Yard, ABCCC is something a little more accessible would be
nice.
And one of the staff people I talked to this morning said, well, he thought Saturdays would
be really good.
But I don't know how you pay for that because it does seem to be partly an issue of money.
So please think about that.
But I really enjoy being able to talk to the people that do the work because normally
Finally, I talked to the people that manage the people that do the work by coming to council
meetings.
Just briefly, because I agree with Council Member Spring that I'd like to kind of see
some things that are below the cut line as well, there's a statement in the budget
about community priorities saying two years of town hall meetings to educate and engage.
Of course, my question is, what did you hear us telling you?
Thank you.
Thank you. Thank
you. Thank you. Good evening, City Councilmembers.
So I want to make a couple of statements.
The county budget has a $251 million budget deficit, structural deficit, they call it.
They're going to solve it by $132 revenue solutions and $118 cost reduction.
So our county is definitely in the red, and one of the things that I heard is that one
of the ways they're going to reduce that debt is to reduce the money available to our non-profits
that provide services.
So one of the things might be that we may have, the city may have to absorb some of
the services being provided.
The state has to deficit us $17 billion, I mean this is coming down, and they're
trying to figure out how to resolve it.
So my comment is that I'm very glad
that the city manager has produced a budget
that appears to kind of balance the fact
that we may have some deficits coming up
and it all has to do with revenue reduction.
I mean, the fact of the matter is that
even though we ought to say that the economy is good
and it looks very positive
because of consumer spending continues good.
The fact is that we have inflation
and it seems unabated.
So our electricity cost went up $1.5 million
and that's not just for the city,
but all the citizens, everybody here
is having to pay much more for the electrical bill.
I am too, and so are you, and so is our city,
so is our county, and so is our state.
And so we really cannot predict in this kind of environment
what our future is gonna be looking at.
So I'm glad that our city manager is kind of looking,
okay, we have to maintain the revenue,
balance it so that it doesn't give we're out of control. Now we do have
reserves and I understand that but there's only going to depend on how we
manage those reserves. I mean so if you think that the that the recession or
whatever it is the economic downturn is something going to last over three years.
Well I was 2007 and all of us can go back to 2007 and it wasn't very pretty
and it did not last one or two years.
Actually, it actually lasted about seven years
before we started seeing a gradual uptake of the economy.
It was going gradual, but we were able to get the recovery going.
So my only comment, of course, is that please consider that
that we do have some downturn, some wins against a good economy.
In terms of the community funding, I think that's great.
I'm glad that the city is investing the money
that can benefit our community to grow, to come together with different and diverse activities
for each of the groups that you're going to support. Thank you.
Thank you, Armando.
Anybody else?
Okay. Good evening, Joe Baranowski.
So the only analogy I can think of, which kind of coincides
with what Renee and Yvonne are asking for, is if you work in an early-stage startup, you
are used to presenting budgets. At the end of the budget cycle, you're running out of
money because a startup doesn't want to have to raise more money than they need, because
during the budget cycle, you're expected to increase the value of the company, so when
you go ask for more money, you have to give away less equity, right?
Now, and so presenting that to investors or the board member, they understand that.
But they would also, in return, ask, okay, so what specifically do you have to do to
ensure that when you're about to run out of money, where's the money going to come
from?
And what specific actions do you have to do so that those people, wherever it might come from, are likely, what's the probability that you're going to succeed?
The last thing they want to do is have to lay off people because they've invested in the company so it will grow.
So this budget cycle, at the end of the two years, has a almost $5.4 million, what Safry
first has operated margin.
What's driving the problem is that the general fund expenditures are exceeding the general
fund revenues by huge amounts.
At that point in the two years, that's 30% of the general fund balance.
And yet, the response is that, well, we're going to look at getting some more tax revenue
or maybe we can go to a tax measure.
And you suggest that, oh, we don't need to know that information now to approve the budget.
It's unbelievable.
I mean, if you were to do that in the private world, you'd be out of the job really, really quickly.
And this budget forecast uses, think of all the parameters are in this, many, many.
but the city still does it. It's their best guess. And yet, repeatedly, they say, well,
on the flip side, because until somebody moves in to an empty building, we can't estimate
what revenue increase that might help, how that might close this gap. I mean, I don't
know how you can make a decision. You don't have the information to approve this budget,
unless because it's headed to a point where you are being asked to assume something
And you have no idea what those assumptions are.
If, in fact, these numbers stay this way
and the city can't give you confidence,
cannot give you confidence that one of those things,
what's the probability of those things?
How will they be achieved?
Then I would ask the following question, which would be,
then it's a completely different situation.
And why wouldn't staff reductions be considered immediately
if you don't have any insurances
that when you get to this point,
you're gonna succeed in one of these proposals.
I mean, so understanding what these scenarios and what the city certainly knows more than
what the public and the council has and what's presented in the estimations, it's time for
that to come out.
We've been asking this for years and years and years.
It's not that difficult.
So you go now.
Okay.
Hi, I'm Maddie Scarate.
I'm the director of the Poppy Jasper National Film Festival and first of all, I want
to thank you for in the past recovering venue costs for the Morgan Hill Playhouse. That's
really wonderful to us. We are an all-volunteer organization. This year we had an eight-day
festival and we had 75 events in 18 venues in four cities. And we had our highest amount
of filmmakers and attendees that we've ever had in the past 18 years. We're really also excited
that most filmmakers stayed. The average filmmaker stayed five days. Some stayed the whole week.
We really stack our events to make it enticing for them to stay. And we had a lot of families come
this year, which was really great. I think the Gila Gardens free passes to Gila Gardens helped,
But I had also kept people here.
And one of the things with Morgan Hill is we were here four days
and we had 90 films play throughout the four days.
And it keeps filmmakers and attendees in the downtown,
which means they go to the restaurants and stuff,
and it builds economic vitality.
One of the things that my mom,
who loves to go up and down Monterey and pass out posters and things, is that the businesses
are saying they have their best week when Poppy Jasper's in town.
And so we really appreciate getting the venue paid for, but what we really want to do is
build on our success and really create, connect ourselves to the community.
We are all volunteer.
We do do a really good job raising money, but it would be great if the city helped
us with the banners. I think that would really connect us more to the community, make the
community feel like we're here for them too. They see the banner in Gilroy, but they don't
see one here. And we get asked a lot, why don't we have a banner here? So that's why
we're asking for that. And it would make a big difference to us. And I think we've
earned it. And we love being here. We used to only be in Morgan Hill, but even
Even though we're in four cities, we're still bigger than we ever have been in Morgan Hill
when we were just only in Morgan Hill, if that makes sense.
So thank you so much for even considering us.
Thank you for doing this for the community.
I think what it does is it makes the community feel like they're seen, and when you're
talking about volunteers who are constantly creating these events, it encourages us and
inspires us.
So thank you.
Thank you.
Anybody else wanting to offer a public comment?
Going once, twice.
OK, back to council discussion.
So Renee, do you want to go ahead and jump in?
Can I just ask what is, what are we done after this?
We're going to do community promotions and the.
The recommended budget.
Thank you.
Discussion on council recommended budget,
as well as the community promotions
And then any other topics that the council has related to the budget. Okay. Yeah. Thank you
So mr. Mayor, we will
What I have up here is the recommended budget for council. Do you want to go to this next?
Well, why don't we have some questions? I think we want to get to first and we'll come to this
Yeah, so well, it'll be a couple rounds. I think yep. Yeah
Go ahead Ray. Oh wait. We're waiting. We'll wait one second. No, I'm just
It's a couple of things, and correct me if I'm wrong, but did I dream about that?
Or did you do that years ago when you worked out a couple scenarios?
One was like the more pessimistic budget.
One was using your term now, the realistic, and one was the optimistic one.
Yeah, so did I dream about it or they would do that?
I don't think you did.
A couple things that you might be thinking of.
So one is on the sales tax.
Many sales tax consultants will look at three different scenarios,
the pessimistic, the realistic, and the optimistic,
and then we typically fall under and use the realistic number.
So it might be that that we've referenced in the past.
In addition to that, you may also be thinking back to during COVID when we had different
scenarios.
And so we had different tiers and things of, you know, here's what we would do if things
look really bad.
Now, thankfully with COVID, we were able to reduce expenditures right away, not make
any significant reductions that would have, and cities are still recovering from laying
off individuals, but thankfully ARPA funds came and we were able to move forward.
So, those are the two things that I think are responsive to that topic.
Okay, I feel better now. I'm not that crazy yet.
But that was extremely helpful.
And I think on a high level, you know, I trust you that you do a great job with your staff drilling through the numbers and the lower level.
But we're here to help with policy and the gift directions, and that happens on the high level, right?
And I'd like to have a summary, especially for the general fund, of exactly these kinds
of scenario.
If we did it during COVID, which sounds about right, I think we can do it now as well.
That should be doable.
And I'd like to understand if you come back, let's say, with the pessimistic scenario,
this is what we would have to give up, or what we couldn't do.
this is, I don't know what that means, I don't want to mandate it for you, but I'd like to see a scenario.
The realistic one is probably what's before us, right, and that it could be an optimistic one.
What if the car dealership weren't, what if five big businesses would come in, just don't put it in the specific budget,
just a high level scenario, right, that we have a little bit an idea of what numbers do we talk about
in between those scenarios.
May I recommend that we now ask Dat and Monica to put up on the screen what the
General Fund Reserve chart looks like, and then just to kind of show a few examples.
But what we have in these scenarios are basically additional expenditures, but not
revenues. We do not build in additional revenues, nor do we build in reduction
and revenue pessimistic scenarios that the Council Member just mentioned.
So
give us an example, because I mean go ahead and put up what you have.
So basically this chart you have seen, the thick green line is what we recommended in the budget
and the other lines are different scenarios.
And of course the one line, the thin purple line right here is more likely than not
if we build in the three percent collar so
that will bring us down below the
minimum reserve level and
then can you show the line below that where we have
three percent collar two more officers and then the quarter sent yes the this
line right here the both remain the council long-term goal reserve at 25% is
is what we recommend in budget, plus 3% COLA in our years,
plus two additional officers,
but that will require additional tax measure
of one quarter cents self-tax.
So that would allow us to build in the COLA for the one
after 2026 and increase the public safety
of additional two police officers,
But that would maintain the CD's reserve at the 25% cost well-adopted goal.
Do
we have this slide?
No.
I was going to say I didn't see that.
Yeah, so this is heading into where I'd like to be.
Again, for the sales tax, if that were an option to discuss at some point,
I'd like to understand how much we would expect, right?
You probably have those numbers. I just don't have your insight, right?
So that this quarter salescent, that assumes that we would bring in approximately how much?
That's $2 million. So basically we currently see each other bring in about $12.9 million for the next years.
With the quarter sales tax, assume that the global spoof color sales tax, that would bring in additional $3.1 to $3.2 million annually.
And if we were to do a utility users tax in order to what Gary has, what would we anticipate
bringing in?
That would be my wish.
That would be $500 annually.
Okay.
And it's a way maybe for two that we can get them on the slide.
I'm not going to remember all that until then.
And I think this is good data information to have.
You know, another kind of thinking, what if we would not give that loan of one million
and out for the street maintenance, A,
what would be the impact, B, of that?
And B, what if we would hire one or two additional offices
if our chief says that that would help
to maintain our safety level?
What if we were to do that?
What would that mean, right?
They have a lot of these questions,
but it's very hard with our numbers to juggle around
and to understand the impact.
And I don't know to what extent and then how quickly you can answer these kind of questions.
Or do we have to submit that to you and then you calculate it?
No, we have numbers already like you mentioned.
It's right now the recommended budget is what we have and what's building the enhancements.
And we know that what's building the budget is million dollars transferred for the street, for the street maintenance we have.
And again, that's the council direction.
If the council directs us instead of filling the street and instead from that to something else and
Each of these officers cost about two hundred thirty thousand dollars
So in theory that's one million dollars group from police for police officers
But it's a something that's community one does council wants that so yeah
We do have to remember how much the cost for officers and what we're in a budget is how much we need to fund
For the two nine ten the street level at what we have right now
No.
Okay.
Okay, about a quarter million per police officer per year. That's correct. That's a correct understanding.
So I don't know if that's a question for you city manager or for the chief, but where are we with regards to staffing the police department to make sure?
And I think we all agree probably that this is our number one priority, safety, right?
If we're not, like somewhere in the slides was mentioned, we're one of the safest cities still.
And I think we all agree we need to maintain that, right?
And as we grow, more pain shows up as well for the good and the bad, but we need to make
sure we're staffed correctly, right?
If the chief comes here and says, what is proposed and perfectly okay, I'm not going to ask
for more.
But if he says if I only had one or two and has a strong justification, and for me
that is something I'd like to discuss.
Yeah.
And so what we do is we bring forward to you our recommendation on how to balance each
of the competing interests and needs of our community.
And so public safety is absolutely the number one priority, but at the same time part of
public safety is making sure that we have streets that are in good repair, in good
order.
And so what this budget does is provides in our mind a balanced approach and making sure
that we are increasing our service level in police by adding one more officer each year
at the same time still taking care of our streets and then maintaining the other programs
that we have.
Now as far as officers go, you know, so it's one in each of the next two years.
And in addition to that, you know, I mentioned, you know, through technology, our chief and department have been able to maximize the efficiency of our officers.
Now, you know, the chief is very comfortable with one in the next two years, and what's important to him is making sure that we're as fully staffed as possible.
You know, because an agency can decide to add five, ten more officers.
However, it's a whole other thing to make sure that those are all fully staffed roles.
And so part of that is our police department has an excellent reputation for the culture
and part of that is the city's culture, right?
And so people want to come to the city of Morgan Hill and so, you know,
he's working to make sure we're as fully staffed as possible.
You would hear from the chief, and he's happy to come up and talk, but in the future, as
we grow, as needs increase, absolutely we'll need additional officers, but for right now
we're just proposing one in the next two years.
Now if you were to say, you know, we want more officers than what's being proposed,
then, you know, I would say, I wouldn't go to just say Streets is the answer.
We would bring back to you where we would make changes, but right now, our best recommendation
to you is what's being presented.
I understand that's what you worked out, but it's my job to ask questions and give directions
as well and maybe tweak what you're proposing if I think that would be okay to do to ask
for that.
And I am going to ask for that, that I'd like to have a scenario to add one or
two officers, additionally on top of what is proposed, and I would like to understand
the impact of that request. I'm not saying that it's a decision, but I'd like to understand
it's what ifs that I have. The other thing is really, if we only were to give half a
million of that loan to the streets, what could happen with the other half, what would
what you do with the other half, right?
Yeah, and part of that has to be...
Yeah, I'm asking a question that I don't expect you to answer now, right?
Because I know you're proposing something, but I'd like to understand that, right?
There are certain amounts we can go here or here, right?
And that one million is pretty significant, right?
And I want to make sure that...
I think we've got also...
It isn't as though...
And again, I'd say, hey, if we could add 10 more police officers, I'd go for it.
But it isn't as though the Chief has not weighed in on this and given his recommendation as to what he thinks is best going forward.
So we get it. Yeah, we can say to you, Chief, you don't know what you're talking about.
We're going to give you three more police officers.
But that money has to come from somewhere within the budget.
And I want to say I think the staff has done a pretty decent job in trying to figure out where all that goes.
I get it. We can come up with scenarios and there's not a problem to do that.
But I would find it a little bit out of sorts to say to the chief or others
You don't know what you're talking about. We're going to tell you how many more officers you're gonna have
It's a scenario plan. I'm sorry, I think it's my right to ask that question
I didn't say it was. We're not making a decision tonight, right?
But I'd like to understand that we've done that in the past not the first time we asked for that
Can I jump in real quick? So with you know looking at scenarios for two officers
So if we use the 250,000 on average, so half a million, we have to understand that that's
an ongoing cost, right?
And so that's each year, you know, and then it gets compounded out.
And so we would look to need to reduce ongoing costs of the same amount, right?
And so if it was just, say, 500,000 for a transfer for one year, that wouldn't cover
the costs into the future.
So we would have to look at replacing, you know, swapping out an ongoing sort
of cost.
Okay. You know, for me, I had to talk with you before and in years past. For me, it's
very frustrating, my role, if we're just roper stamping what's in front of us, right?
Then what's the point of us meeting and having a discussion? If this is it, then we can't
have a discussion, right? Very frustrating for me, to be very honest with you. And
I want to be able to explain why we're doing certain things, and it's my right
to ask questions. We're not making decisions tonight. It's my right to ask questions. Another
question I have is, what if we were to impose a hiring freeze now, money-wise, what would
that mean? What could you do if that money would not be spent?
I don't think you have
an answer now, but I'd like to understand that. If it goes downhill, we need to quickly
know what that means.
I don't want to come and ask two years from now. It won't
be me, but someone will ask three years from now if that scenario were to happen, right?
I like that approach. That is a little bit more scenario planning in that if things start
to turn south, what is plan B? What is our, what would be the scenario planning at that
point in time? To me, that's something we should be looking at so that we could
act more quickly. I don't think it's likely we're going to see additional revenue,
And therefore, hey, we can add more officers.
But yeah, so those are the kinds of scenarios
I'd like to see a little bit more of and ask to.
It can go both ways, right?
I'm an optimist by trade.
And yes, there will not be a recession.
I told you that two years ago, and I'm still right.
They will see.
But the optimistic side of that is, yes, we
might get more sales tax revenue
and currently budgeted for in your realistic budget, right?
Very likely that will happen, right?
But I sense our staff is a bit reluctant to play with those scenarios
because they're hypothetical ones, right?
But from my perspective, we should think, right?
The mayor also, we had discussions not too long ago
when you had your big dream about other areas, right?
And I still have them, and I have a right to have them.
Exactly, right? And you got tough on me that evening, say, well, if you can't dream, it
will never happen. Well, why can't we talk about that now? It's the same, the same thing.
No, no, you're absolutely right. So, what if we had those additional revenue funds?
How much could that be? My point is this, right? And one car dealership more, a hotel
tell more, one of those businesses failed
where we have empty buildings.
And then where would that go if that were to happen, right?
I think these are answers we have to give.
And the last question I have before I'll then hand off
to someone else is, and I think I was wrong
and until I kind of started preparing again for tonight,
I always thought if we go to the voter
with a very specific tax that the bar is lower,
but it's actually the other way around, right?
Yeah.
So the less specific we are for what the money will be used for,
the lower the hurdle is to get voter approvals.
It doesn't make sense to me, but that's how it is, right?
Yeah.
Because it basically commits future councils for how those dollars will be spent.
Okay.
Because it was kind of, before I had to correct myself,
it might think I was thinking, well, if we came up with some specific tax,
I don't know what the right term is, let's say a safety tax, right, for police and fire.
But that would require two-thirds now, right, which is a very high hurdle.
And in the original, I thought, well, we should be able to get 50% plus one, right, for something
like that.
So I guess we're back to not being specific when we talk about the sales tax.
So if I can just jump in.
Just real quickly, one thing, and that is, again, with all the scenario planning,
I get it.
We can do all of that, but none of that is necessary to approve the budget.
Now, if we want to move money within the budget, we have to continue that conversation.
But to determine whether or not, if we have extra money or less money,
that's not necessary to know those answers to approve the budget before us.
Again, if we want to move money around within the proposed budget,
that's a conversation we have to have.
That is correct, but those scenarios help you to make exactly those calls.
right? And then maybe I disagree with adding this position, right? And then it has an impact
of what's in front of us. But if you don't understand the various scenarios, it's very
hard to just... Because then you get the city manager and say, well, we had all those
discussions with staff and all those discussions. It's all balanced. And there you go, right?
So how do you get the preparation to be able to make certain tweaks to what's in front of us, right,
if you don't understand the impacts?
We have to understand the impacts to the existing proposed budget.
Not to, if we have $5 million down the road, what does that mean?
That's stuff we can figure out, that is stuff we can't figure out later.
It seems to me that we've got staff who have some comments they wanted to make.
You guys look pretty antsy over there.
So, Christina, why don't you go first, you have some comments, you want to make them go to Chris and then to Edith.
Sure. So definitely we can look at different scenarios and our plan is starting in the new calendar year to start the discussion of what a potential revenue measure would look like.
And then, so I wanted to mention that. And then the other item I wanted to mention is, you know, part of, and I know the presentation went into this,
but I just kind of want to summarize that putting together the budget, right?
We have a framework of sort of the existing budget and the status quo budget,
but we have tools that help us put together the budget
that are foundational documents that council has adopted, right?
So I think about the master plans.
I think about council's priorities.
I think about council's guiding principles.
And I think even when we think about the two officers, that's something
that we've been talking about over the last couple of years
that we were going to be putting those into the forecast.
And so those are sort of the building blocks that we have in order to bring this recommended budget to you
So I know Chris has something and then Edith does as well
I just want to make a note on the streets transfer for the general fund that
Reducing that transfer could have an impact on revenues because we have required matches that the city has to pay and
Funding sources that fund that to some extent too
So it might not be a dollar for dollar savings if you reduce that one million dollar transfer
obviously it can be looked at, but it might not be that full dollar for dollar.
Okay.
And I would like to address something based on one of the comments made by public comment,
and the fact that there is somehow money being hidden by the staff.
That's ridiculous.
That's an outrageous statement.
It doesn't exist, and you can get as angry as you want, trying to find something
that doesn't exist and have at it.
But to question the integrity of our staff who puts this budget together,
works hard, has done it for years that is an outrageous comment to make and I
don't appreciate it. I want to protect the staff's integrity here. Yvonne have
you got some questions?
Can you hear me? Yes I do. I'd appreciate if I could get
through my questions and then after if you have questions of mine we can go
through those but I'd like to be able to get through my stuff. If you would
please yes. Great. So first I wanted to know how do we fund the
enterprise master plans, are we able to use enterprise funds for that?
Yes, we use both, I think you mean impact funds as well as the enterprise funds.
So they can be funded from both because the impact funds are used on future
planning and that part.
So we use both to fund.
It's a combination for all of our master plans.
We use a combination.
Okay, awesome.
That's good to know.
I also wanted to know for the automated transfers, that policy is still, that's still happening now.
Whether we're in a deficit of operating or not, we're having those automatic transfers automatically.
I'm going to ask Dat to respond to that question.
Yes, I know. Yes, in a way that even though we deficit offering margin, but at the end
of the year, we operate, we come in, we actually come in better than we budgeted, than just
those who will be automatically transferred a portion of that to the respective funds
as the council adopted a couple years ago. Now, is that if the budget come in as
That's exactly what we're sending, or we're sending that.
No, we will not chance for those out. We will chance them out if they are coming actually better.
Okay. The reason I'm asking is, this year, which is closing in June, we're 5.7 deficit for operating margin.
We've got next year, $24.25, a $6.3 million deficit. And in 2526, which this funding goes through, a $5.4 million deficit.
When we have savings, it's savings maybe on a program, I'm guessing, or a project or whatever it is.
But that savings could be applied to this $5.7 million deficit or the $6.3 million deficit or the $5.4 million deficit that we're looking ahead.
So, I think that we should look at the automatic transfer of any savings because really we
don't have an end result, a net saving.
We have a deficit.
We have a $5.7 million deficit.
And so we should consider looking at which of those still makes sense.
And I think probably some of them do, right, if not all of them, but I think we should
look at them it shouldn't just be an automatic transfer. So that's one thing
that I'm going to look at us to address and I think that that's something we
should do with this budget is have staff and go and look at that and review. Is
this some savings that should be taking place? So and to that I'll say
complete trust in the staff. I don't think anybody is questioning the staff
or their integrity or what they're trying to do or you know that it's
not shown or not. I think it's difficult to understand if you're not a finance guru,
if you're not have that background to understand for the lay person to dig in. I mean, I've
spent hours going through this. I doubt that the average citizen has spent hours going
through this meeting with, you know, with staff and things like that. So I will tell
I mean, some of us, you guys have made it very friendly. Some of the cities have
a PDF where I feel for my colleagues who are digging through that. But I think that's
kind of the crux there that I think people are trying to understand. We've all seen it
in the news. We've seen what's happening in Campbell. We've seen what everybody is
facing. There's no unknown elephant in the room. Everybody understands what's going
on here. They're trying to look at the numbers and understand it as my colleague
as I am, which is why I'm asking these questions, and I want to, again, reiterate, has nothing
to do with your ability or, you know, what you are or aren't showing.
It's just trying to make decisions and making sure that we have all of the right information.
So having said that, I would ask that, again, we have you guys review and look at those
transfers, and I know that they're automatically the policy, but I guess I'm asking that
we review that policy and make sure that may not pertain.
You know, maybe we need to look and have a review,
especially when we are facing deficit.
Maybe we review those automatic transfers
before they happen.
So that's something I'll bring up as a future gen item.
Then I wanted to ask the recreation facility
expansion and enhancement.
So you have at the Outdoor Sports Center
are 7.5 million dollars in the CIP. You know what? Let me go back. I'm going to go back
to the operating budget. Sorry, you can hang on that one for a second. So for the operating
budget, I'm looking at, we have, you know, some of these we'll be talking about in
the community promotions. And the reason I'm highlighting that now is I have a question
on one of them that is coming up for the community promotions and also in the CIP.
For the operating budget, economic development contribution that I'm trying to figure out is what are the revenue,
what is it that we're similar to what Councilmember Spring was saying,
what are the revenues that we are anticipating to see?
I'm looking at the figure, well, this is a different one.
I can't wait to get that.
But the figure that we have in operating budget,
you see the curve and it's kind of rapidly,
for the next two years, it's declining.
And then it kind of curbs and it slows.
So it goes from one million to a $1.5 million change
and I'm wondering why do we have that
and what is that attributed to?
What are the revenue assumptions that we're using when we're looking at that change?
What is the one point two and one point five?
I can respond to that one.
Yes, yes.
Those are projected budget savings.
They include vacancies that we potentially may or may not have,
as well as non-personnels like supply and services.
And these amounts are consistent with what we have experienced in the past.
Okay, so it changes.
It goes through the $1 million savings is through 2026.
Then it goes to 1.5.
Why are we having a $500,000 difference for the next three years?
Yeah, that's because the cost in our years continue to increase.
You see the overall cost increases.
So that's why we anticipate that it will keep percentage of the servings at the current level
with increasing costs and those dollar miles will come out to be about $1.5 million.
And again, I want to reiterate that these amounts are not poor from the sky,
but they are from past historical servings, including personnel vacancies,
as well as from the personnel that we actually had in the past.
Okay, so you can understand my challenge so this is you're saying that this is
personnel vacancies because when you're saying vacancies I'm thinking in my
mind Butterfield 5, Trammell Crow, I'm thinking those vacancies so you're
talking about personnel vacancies? Yes. Okay. Now we are doing a sales budget,
we're not doing a
ED, I'm trying to understand what is the anticipated contribution.
Sales tax is a huge portion of our general fund.
We've got Butterfield Vive, we've got Trammell Quill, just one building.
I'm just asking for one building.
What is that contribution and sales tax that we could anticipate?
And I mean net revenue.
Thank you, Council Member.
I think we're finally tracking where you were going.
So you're looking at, do we know how much revenue would those projects bring to the city
from sales tax perspective, like the Cochrane Tech or B5?
Those particular projects, they're intended to be manufacturing type of uses.
And at best, we might get business-to-business revenue, which is somewhat, you know, limited.
It's not like sales tax.
So these are not like the commercial shopping centers like where we have a target that will be a significant revenue generator for us.
Those projects generate property tax, which is good. It will be a lift for the city.
Even if the projects are still empty, the city will get an immediate lift on property tax revenue.
Eventually, we will have companies that will bring jobs or will provide jobs to our residents
and maybe depending on the company, and we don't know that yet, there might be business
to business revenue.
Okay.
Do we, when are we assuming the buildings are built, when are we assuming that that
is going to impact our budget?
Are any of those assumptions of sales tax business-to-business or the on-site taxes?
Is that in this budget in any year?
For the self-tax notice.
For property tax, yes.
Because for self-tax, that's a...
Improvements to land.
Sure.
First, we don't have to be occupied yet, we don't know what business can come in,
but it is mentioned that they are more like the manufacturing, and if they are a sale tax,
they are more like business-to-business transaction instead of part of sales tax,
like top-to-center or shopping center.
So there's no sales tax from any of the Butterfield 5 or any of the
No.
Correct.
Okay.
Only property tax revenue expectations.
That mentioned.
When.
This.
Okay.
This budget goes out.
To 2029.
When is that.
I'm not.
I'm lying.
2930.
When does that.
When are those projections?
When someone occupies a building, the property tax will be built in, because especially the
Bolivier FI, they completed it two years ago, so they will be assessed at a new assessed
value.
And for the travel grow, they will be in the upcoming assessment role, but in the meantime,
they can build as a supplemental tax bill as well.
So that's why I mentioned that normally, if everything stands still and starts going,
nothing turns, nothing gets built, our property tax increase is going to be capital 2% based
on Prop 13.
And this is what we build a budget of 6% for in the next year and 7% on the second year
because of both development that we build add into the assessment role as well as
the new development that we expect to come in online.
No, I appreciate that, thank you.
I get that, the assessment and the property tax.
But for the next six years,
we have projected zero sales tax for any of those buildings.
That's right, because we don't know
what type of building is gonna go in there.
And so as Edith mentioned, at best,
it's business to business,
which would give us some level of sales tax,
but we're not guaranteed that.
And so we don't build it into the budget
it until we know what's going to be there.
Until someone occupies the building.
So when, okay.
So we had projections when we talked about this building
and we were told about how much this could generate
for the city.
And so there's got to be some projections
of how much we anticipate that they would generate.
But you don't include that in the budget.
Mayor, could you please let the staff answer
No questions unless you're a finance minister called an answer to the finance.
If they're maybe not understanding the question, the fact is when someone occupies the building.
The mayor will ask my questions.
No, I'm just trying to help you understand it. Let me ask you a question, Yvonne, and maybe this will help you out.
I don't need you to help me understand the question.
I would like for the leadership to an economic development to answer my question.
Do you take a check to the bank and make a deposit on an item you haven't...
Thank you for that.
Have you done that? Do you take a check to the bank that you haven't sold an item?
We're not collecting sales tax until someone occupies the building.
That's when, if sales tax is generated, that's when sales tax is collected.
Am I right?
Yes, if I may. Thank you, Mr. Mayor.
I understand that there were some assumptions, perhaps, or some conversations that we had
when the projects were being reviewed and being considered.
I think that a big picture for us, the business-to-business potential revenue that we might get is not
a significant amount of revenue that would necessarily tremendously impact the budget.
I think that from a high-level perspective, it is good for the city to have a diversified
tax space, and it is good for the city to grow our business-to-business tax.
And other communities have a little bit more of a business-to-business fabric than
we do. But we have taken the approach of being realistic, knowing what we know of how long
this project's take to come in, and knowing that the alternative of us building in projections
probably would be more detrimental to us in making assumptions, laying assumptions
that might help you make decisions on hiring
when those assumptions don't come to fruition?
Yeah, if I can just add, thank you, Edith.
So a couple things.
So this is sort of consistent how we've budgeted in the past.
We don't start building something into the budget
until we have somebody that's moved in
and we know that they've started collecting, in this case, sales tax.
An exception to that might be if they are there,
they have their permits and it's a known business
that has a record other places of producing sales tax then we might be
prone to put it into the budget but we do have to be cautious for the reasons
that Edith mentioned but similarly like on the retail side you know you mentioned
one of you mentioned fast food and Chick-fil-A and raising canes until that
starts going up and we know that it's a done deal that I mean we wait until we
put into the budget and so in that sense you know we're trying to build
the realistic model for our budget now.
With that said, we come to the council monthly, right?
And so you hear from Dat quarterly
when he makes a report on changes.
And so if we find out that those buildings
are going to be leased by businesses
that are going to bear sales tax,
then Dat updates the forecasting models.
And then we bring those forward
Bye.
Bye
Council at that point.
Can I speak? Yes, go ahead. You have the floor. Just get to the point. If you could, again, refrain from interrupting me. I would greatly appreciate it.
This is a open forum, and we can get to your questions. If you've done it to my council member, you've done it to me. If you would let me ask my questions, I would appreciate it.
The reason that this is important is because as we're talking about with PDE that we need
additional officers for example, if we know that we have projects, we now have Butterfield
5 built out, looking at what we could possibly having an idea of what that generated sales
tax could be is very important.
So, I'm given a number, a general estimate, of $55,000 per 100,000 square feet.
Would you say that that is roughly a,
that that would be-
It didn't catch that, I'm sorry.
55, so let's go back.
So $55 per square foot as a generalization of what you might get in business to business taxes,
meaning for 100,000 square foot you would get $55,000.
No. I'm not... I wouldn't be...
You can just tell me what you think that one of those buildings...
I can tell you that we have wonderful companies in town today that provide great jobs and their
name companies that you will recognize, but I won't name them because we're not supposed
to be sharing that information, but they generate no revenue.
They just provide wonderful jobs for our community.
Okay.
So when we talked about the economic blueprint and we talked about generating income for
the city. Are you telling me that we built Butterfield 5 and the Trammel Crow buildings
so that we could have only good jobs or was that not also done to generate tax dollars?
It is also to generate property tax revenue, revenue that we get from the employees that
come and work and have lunch here. And yes, you are right. There are some assumptions
that were made through those entitlement processes
as to potential revenue that could be generated.
I don't have that at hand right now,
so I cannot quite immediately confer
the number that you just shared.
That's fine.
What I'm asking you is that there are sales tax dollars
that we are anticipating to have
from advanced manufacturing.
There was a whole discussion in this community,
would they be distribution?
No, they wouldn't be distribution.
They would be advanced manufacturing.
There is the potential of business to business tax as well as we will have property tax plus
some other economic spending revenue from the employees.
So knowing that, one could assume if we were to get some tenants in these buildings, we
would then have, if we had decided, yes, we need some additional PD officers, we're
going to look in a budget to see where that is.
Maybe it's a small bit from the street.
I have no idea.
Staff can look at that and come back.
Maybe it's from somewhere in our CIP.
Maybe it's from when we get some buildings filled,
then the first thing we're doing
is we're bringing in some pity.
But I think that is a very pertinent discussion
that we need to tie to this budget.
And that is why I'm asking
because we need to know what those assumptions are.
this council whether everyone agrees or not they don't need the information that's
fine but I've heard now from myself and someone else that it would be helpful to
have that information as well as for the residents to understand what the
assumptions are that are built into our budget. Okay I will now continue if I
I also wanted to ask about the development service fund for the $1 million loan for the
general fund.
Will that be repaid?
Go ahead, Deb.
Go ahead.
The budget has been billed as we pay in the 26th, 27th to begin in the 26th, 27th.
Okay.
So it will be repaid in the 26th, 27th.
Great.
All right.
But now, I'll talk about the CIP.
So the CIP, for $24.25, we've got $60.7 million that are assigned to our CIP from our general
fund.
And I-
No, no, no.
Council Member, that's not correct.
Okay, can you please tell-
There's almost no money assigned to the general fund except for the streets transfer.
The rest is not general fund.
There is zero general fund dollars except for that transfer in the CIP
So the only the only dollars for street except at the mouth. So on page for this five
Even on page five of the CIP
We have a budget summary at the top by bike project category in the bottom is shows all the funding sources
And so everything from park impact to Quimby and so forth
shows how these projects get funded and then you go to the individual sheets by
project to see where the funds are coming from. Yeah, there's no, the only
funds that we can look at for the general fund from the CIP would be that transfer
which may reduce other revenues. I just want to be clear on that. Okay, got it.
So it's only the one million for the street funds, that's it. Correct. Okay,
Okay, now, the monies that are set aside in the CIP, the $60.7 million.
Where are you getting the $60.7 million?
That would help us.
You have the CIP.
You're one.
Okay, yes.
That is, that's all allocated to all these individual projects.
Correct.
Okay.
And so, we could reallocate from those projects to elsewhere.
No.
Those are, those are all restricted funds except for that $1 million.
Okay.
to be allocated within a specific use for that fund.
That's right.
So they can be reallocated. They just have to be within the fund.
No, they have to be reallocated. They can't be reallocated.
If we reallocate them away from the projects they're dedicated to,
because they're impact fees paid by developers,
we have to give them back to the developer.
So there are restricted funds that are tied to specific projects
projects based on infrastructure master plans and then there are some funds where we have
multiple projects identified in a master plan like our parks and rec master plan which
we aren't able to fund all of it.
So you could choose to say we want to use funds differently in projects that are tied
in the master plan that are tied to the impact fee.
So there's some flexibility within some specific areas.
areas. Our utility areas are much more restricted. Those areas are much more restricted than some
other areas, but they have to be for an allowable use that is identified. If it's an impact
fee, identify an impact fund, and then we do have some remnant RDCS funds. Pavement,
as we talked about, comes from different funds. So there's some flexibility within
in different areas, but there's not a lot of flexibility.
Okay, can you go back to that slide and the CIP
that I had asked to have some projects identified?
Projects that aren't funded.
Which area?
It was in, I don't know if it was your,
yes, it was in the recreation
and it was one of the last slides.
Similar to what you just showed on
that one right there.
The fire station.
Yes.
Yeah.
Okay. So are all of these restricted?
They're all restricted to a certain extent.
And it depends on the funding source.
But there is a possibility of moving them to other identified projects within the master plans that we have.
Okay. So are these tied to the master plan?
The master plans tied to a lot of them and then some of them are tied to basically renovation
projects that we've identified and needs for on the funds that are allowed to be used for
renovation for parks and rec.
Okay, so when you say park facility expansion and renovation, what is that for?
Yeah, so if you go to the project that's listed in park facility, let me pull it
so I'm not totally misspeaking, but there is some...
I'm sorry, I think I'm thinking the Recreation Facility Expansion and Renovation.
Is that the Outdoor Center?
No, that would be the Sports Facility Development Project.
Okay.
Is that the one you're talking about?
Yes.
Okay, so that project has a specific project, so identified in that project,
it's related to the Condit Road Facility Master Plan project,
which we brought forward in the Council reviewed and approved.
So within that project, it's kind of a, and I think you did mention it's about 7.5 million
dollars over the, over the life of the CIP.
So initially what that plan is, is we have purchased through past CIP's additional properties
that are adjacent to the Outdoor Sports Center and Aquatic Center.
And we plan to move forward and figure out how to develop them.
So in the early years, it's moving forward and identifying the environmental work to
complete that plan and then we would be doing concept design on the first phases
of making that plan a reality and then in farther out there would be funds to
start constructing it. Is that the five million dollars? Yes the bigger the
millions are in the out years and that would be after the environmental going
through design process and prioritizing within that master plan that we
developed what we want to do first and then using that fun those funds
implement the master plan. Okay and so the construction is I think what in year
five? There's like it's in year three and four. Okay and that is quick a second. So
that's going to pull it up but for those that are looking at the CIP
document it's page 24 and 25 and so what that's going to show is each of
these questions so there's a project description and then how it gets
funded and so we're going to pull it up on the screen just for the benefit of
those that are here. What would be constructed for that five million dollars?
So that has, there's a hundred million dollars of improvements outlined in the
plan so we have not finalized on what the first phase would be that would be
developed through the design process in year two and it would come to the
Council on the Parks and Recreation. So this is a hundred million dollar
project that we're talking about. There's a hundred million dollar master plan
for the site, we have the 7 million allocated.
Right. Okay.
And we will know more about where you plan to get another $93 million.
We don't have to build the whole project, its phase.
So there's multiple buildings there that enhance the aquatic center,
as well as enhance the sports center.
And there's multiple new fields to be constructed,
So that would be, they're still a process for the council to prioritize and decide what in that master plan is the first phase.
All we're saying is we're working towards building that.
Okay, so I just want to make sure, because we came and we talked about this at council, and council decided that this was not something we wanted to put a revenue measure for, that this was not something we don't know.
I'll no longer have the redevelopment money flowing in.
So this wasn't something that we could do but we've been doing this long-term for the past 20 years
Incrementally, and that was what we wanted to move forward with that's what we're moving forward on great
So this master plan that we're spending the first portion of this the 2.5 million in
site looking at the site and planning it out 2.5 million the first year will be
Completing the environmental review for this site. We're actually looking at the additional property
we did on Butterfield and that's mentioned too, and looking on the first phases of making
sure we have the overall concepts and getting that master plan through the environmental
so that we can start phasing our work going forward. Then the second year would be money
to say, hey, let's design the first improvements, and that's where we would come to the Commission
and the Council and say, out of these $100 improvements, what do we think are the
most important and start that little piece. So we're not spending millions of
dollars on this project for the first two years. It will be going through a
process that we're going to help make it a reality that we can move forward and
then we bring it to council, the community, our partners, the commissions
and then choose what is going to be the priority in the project and move it
forward. As well as look at are there partners out there that can help us
Let's build more than the $5 million, $7 million we have, and then when they come on, it maybe
comes $14 million or something.
Probably not $100 million.
Great.
Probably not.
I just want to make sure that we are, you know, we've got the master plan.
I saw the $5 million at the very end, there's $2.5 million leading up to that.
I'm not sure what that's based on in the years.
That's fine.
And it's in the chart on the second page right there in the middle.
It shows how the dollars are spread out over the six years.
So I just want to we're doing the master plan and in that we will be talking these will be elected this will not be
this has to be funded and
We have to do this
correct and
There'll be things within that this that we will be able to choose from that are within our master plan and what we've done
To develop the planning for this document. We don't have enough money to build the whole thing
We're being visionary and we're going to spend funds on expanding the system
but exactly what improvements are still going to be done at, you know, we're at the
30,000-foot level now when we need to get down to a level that says what we're actually going to do.
Okay, so we could take those $7 million a month, saying that I'm advocating for that,
but we could take those $7 million and we could allocate them to another Parks and Recreation
project with MSCIP. Yes. Okay. To a certain extent, yes. Okay, great. Okay, so then
Then you also have under recreation the 1.5, well lots of renovation happening to our facilities.
And I would say that that is a priority for us to do and I want to confirm since we have
a 1.5 million dollar expense in our electricity cost going up that our facilities and energy
energy efficient, solar gas to electricity, that's all going to be our priority projects.
The renovation of our parks funds we have available for renovation will be used for
renovation, not for new things that help us with our operational costs to your point.
But any renovation of facilities, I would like to see them be focused on addressing
seeing this $1.5 million increase in electricity.
Yeah, to the extent we can, we are absolutely doing that.
Great.
OK, perfect.
And then I want to look at the Capital Improvement Fund
for the Morgan Hill Historical Society.
And this is $3.75 million that you
have as an expenditure in the CIP budget,
page 20.
We can get to page?
Page 20 of the CIP, and it's up on the screen now.
Yeah, so this is a project that the council approved
a conceptual master plan for,
the expansion of Villa Veramonte.
As we mentioned, this could be a $15 million project
to build another building and improve the site.
So what is proposed is the initial phase one
of the site improvements,
which would be storage, restrooms, driveways,
all the utilities that are not there
and improving our first phase of that site
and consistent with the approved concept.
Now, what will have to happen first is remember
we took this concept to a 30% level.
It will come back to the council
because we council will need to choose
to award the design to take it to 100% designs
and then the council would have to choose to award this project for a future to fund
it and do that. So it will come back to council for future review because there's more work
to be done, but this is consistent with our master plan and our Recreation Facility
Impact fee.
Okay, so this is also something that could be reallocated to other areas?
Yes.
To specific areas.
Yes.
To recreation facility, not to renovation, only to new, and things that have been identified.
Okay.
And it would have to be to a community serving facility, so it couldn't be a small park.
It would have to be a park that serves the entire city.
Recreation facilities.
Okay, great.
So that's something that I would look at if we're having anything that that would
apply to.
I don't you know, I'm concerned one because we've got 3.7 million in there
Which obviously at a deficit of 5.7 million dollars this year and going forward
That isn't something that we have right now
Then I've looked at the operating costs, and I see that we've got a rental
Don't I think this is an absolute gem. I think that we could do much more with this building
I mean when I look at this and I went and walked around the historical society
reached out to the board. I see that we've got rental for $4,500 for the year. And I know
that the President was here. I don't see him.
So I want to make one thing clear. The deficit you're referring to is a general fund deficit.
These are restricted impact funds. They can have no impact to replace that. They can't
used to do that. They have to be used to build a new recreation facility. So, I
understand that, but you're looking at building 7.5 million dollar new
recreation facilities. We just discussed that. Sure, but it doesn't have an impact
on the 5.7 or the 5 million dollar plus deficit that you're referring to.
There's not a direct impact. Right. I'm just simply stating that there are
competing dollars here, heavily competing dollars, and if we've got 7.5 that we're looking
for at the outdoor sports complex, we've identified tourism, I'm looking at this for 3.75.
I see rental income for an annual year of $4,500.
I think that we could be doing a lot more with that building, and I would like for
us to be doing a lot more and I think maybe our dollars would be better used to try and
build out, you know, somewhere where we know we're going to be getting some return on income
and taxes and all of that.
And then I'll just say to cross back into the operating budget that there is, there
There was a request for $35,000.
It was first $20,000, and then it was another $15,000.
There's some others in here which I think are perfectly fine.
And I think that that, and I brought this up before,
having a $20,000 or $35,000 request for operating expenses
is probably not where we want to have it in community promotions.
Now, that might be something that we want to include in CIP, because that seems much
more fitting, but putting it into community promotions does not seem like that is the
appropriate place where we would have where we're doing that.
Okay.
To be really clear, these are expenses for water, fixing long landscaping.
We do not have an eligible CIP to fund that.
That cannot be funded from the CIP.
That's not an option.
It could be put into taking out a community promotions and you could ask to request the
city manager put it into the park maintenance budget, but it's going to be a general fund
expense, whether it's in community promotions or in park maintenance.
So the dollars you allocate will still be a general fund expense.
If the council, the will of the council is to change how you provide that, that
can be the will of the council.
The use of the facility, we worked with the consultant and we worked with Villa Miramonte,
and I have spent many hours visiting other sites that manage historical resources and
where cities pay hundreds and hundreds of thousands of dollars to do less than we do at Villa
Miramonte and operate them themselves.
What is their rental revenue for the year?
I don't know the rental revenue.
I think that would be a great thing for us to look at.
I can get that for you, but I can tell you the net impact on the general fund of operating
the facility versus the rental revenue is a much larger negative impact on the general
fund.
So by...
Let's make sure we're comparing apples to apples is what I'm saying.
I'd be happy to talk about it.
I think our recommendation on the community funding has been provided.
The council can definitely discuss that and the council can request that we do more research on this as a whole.
I think that community funding is for events and programs. There's not one in here other than the Freedom Fest,
which I think we would all agree provides entertainment and, you know, community involvement for thousands of people,
as well as the Friday night music series.
So I think that that is something that, you know,
this I'm looking at the city annual grant,
which some of these are maintenance costs.
They're not operating costs.
And I think-
Councilor, you don't have to get you to move along here
with your questioning.
That's a budget that the Historical Society
puts together.
You can have a conversation with them about how they can generate more revenue in that particular budget, but we're wasting time here on that discussion.
Well, I think it's important if we're assigning $3.7 million and we have $4,500 revenue every year, 20, that's definitely a...
This is a community asset. This is property owned by the city. This is not... You're talking about the...
I'm well aware of what it is. It's $4,500. We also have community assets.
We don't make revenue on our other parks. I mean, there's some revenue that comes in, but it's not...
We just heard from our recreation director that we are generating $1.2 million for rentals of city facilities.
This is a city facility, and we should be getting much more than $4,500 a year.
I could probably generate that running the room.
I'd like to see it.
Chris.
That is from operating a facility, primarily the Community Cultural Center, which was
designed to run as a rental facility that the historical society, the house, is designed
as a historical resource.
I just want to be clear.
It is used for rentals, but it has significant, significant restrictions on it.
So, some of the improvements to the site may provide a better opportunity for increased
revenue.
Chris, the way that that site is now, I think anybody would want to have a baby shower there,
a tidal shower there, a wedding there, an anniversary party there.
We're going to get, we need to move on to the conversation.
Yeah.
We'll let these historical society deal with their revenue.
I also, I'd like to understand, you know, it sounds like there's a difference here
between, I was given a one budget and I have another budget and they just don't
So they're cat difference here drop that off before she had to leave and
those are the programs that she runs and she just wanted to get everybody to see
what are the programs that are run over there and how much money that they're
anticipating from a cat county grant I see that but some of these are on here
and they're very different and so that's what I'm yeah that again that's
like that I think because she dropped it off I don't I don't even get it
It shows they have a $15,000 for the mariachi, you know, a grant for that, and then here I
see only income of $5,800, so we haven't reviewed it.
We haven't reviewed it.
Okay.
Thank you.
Okay.
Do you know?
Would you like to jump in?
Sure.
Thank you, Mayor.
First, I'd like to just make a little statement, I was going to jump in before I would appoint
the voter, but I'd like to ask you to remind the council about the city council norms, you
know, be respectful and patient with one another, be professional, keep the decorum and clear
to ear.
I, you know, if you have a problem with somebody on the council, you know, go offline
and clear-to-ear shouldn't be done in the public.
So I wanted to make that statement because I think it was pretty poor what I witnessed today.
First, thank you, Christina, for answering all my questions prior to the meeting.
And as far as revenue, let's just take an example with Butterfield or any business.
When you employ people, those people go out to the local businesses and spend money.
There's revenue there.
Okay, it may be unknown at this time, but if a business employs 100 employees,
those employees have to eat somewhere.
That relates to revenue.
That's my expert opinion on that.
Scenarios and examples of potential revenue, I think, are really good.
So I agree with many of my colleagues when we're asking if you could just look at some
of those scenarios because they can help us.
You know, none of us has a crystal ball.
I don't know what's happening six months from now or a year from now.
There could be another war overseas, and that could cause havoc in the United States.
And, you know, so we don't know, but what we do know is XYZ, and I'll give you an example.
We know that a hospital is coming in with medical offices on Juan Hernandez, and it's going
to be sometime in the near future, you know, within the next two years, you know, given
I mean, don't quote me, but I think it's a 155-bed hospital, and it's Palo Alto Medical
or Sutter, I believe, with a medical complex.
Those are high-paying jobs, and that relates directly to revenue for the city.
So I'm not asking you to try and do a crystal ball, but if those were to come in and
And if those employed X amount of people, you know, what that possibly could relate to in
dollars and cents relative to revenue.
I think all those factors could really help out.
So Edith in the Economic Development Department, I think you're critical in helping out
in this area.
And so I'm asking and relying on you to maybe generate some of the things that
discussed here today. Thank you, Councilmember. I already had that with
Councilmember Martinez Beltran, but echoed by you. Thank you. Thank you. That's
all my questions, Mayor. Thank you. Very good. Okay. Back to you, Christina. Okay.
DAT, can I ask you to put back on the slides towards-
It's the end for community funding.
So included in your packet, there is the listing of the
28 applications that we have received. And so we, a few years ago, started an application
process for the community funding. And so what the attachment does is it shows, you know,
what were the council adopted principles for applying and how to make sure it's a nonprofit
And so what our team has done is come up with several different options for you to consider.
We received a total of 408,712 total funding requests and so various options.
And so the first option is to fund only long-term events and basically no overall increase from previous years.
And so we've budgeted 200,000.
And so this is just shy of that.
And that's our recommendation.
Now, however, there are other options available to the city.
Option two would be to fund recently funded events at past levels, but increasing for
city rental costs and increased public safety costs.
If this council decided to go forward with that, that would be 38,000 more than we've
budgeted.
Option three would be to say yes to all of the applications in full, so that would
be basically a doubling of what's budgeted for a total of 408,712.
Option number four would give the council the option to approve specific events and programs.
And then option number five is to provide some sort of alternative direction on prioritizing applications.
So basically asking us to come back with new priorities in mind.
And so now what I would recommend is that the council would have a discussion regarding how to allocate the funds.
And you'll see in the attachment, it's attachment number four.
It's five different pages, and so page number two is a summary of all the events showing
what was allocated last year, what was requested, and then columns for each of the different
options.
And then the pages that follow are option one, two, and three.
And then the last column shows the type of funding that's requested to give you a little
bit more information.
And so with that, I turn it back over to you, Mr. Mayor.
Thank you.
Any questions or comments?
Tino.
Thank you, Mayor.
Christina, could you just explain, though I went over it with you, the, I
guess number
two.
Sure.
Could you explain a little bit more in detail what number two is?
Yeah.
So basically this option lists out the funding recommendations and events that have received
funding in the past.
Now, due to budget limitations, this option doesn't include any new events that are being
brought forward.
For the twinkle lights request, funding wasn't included, as it's recommended that the Downtown
Association work with the PBID to fund for this year and into the future.
And then here's the other thing is that the events are being recommended for increases
to costs above and beyond what they've received in the past if it's due to the
facility costs going up or public safety.
And so events that are recommended for CCC facility costs are noted with an asterisk.
And so, Dad, if it's possible, maybe you can bring up attachment number four and page
four.
Does that answer your question?
Yes, but you also indicated that you would increase the cost for, like, rentals.
Yeah, and so what what does that mean that I'm trying to figure out so that there are
X cost for rentals, and I'm just going to take an example
The 4th of July
So there's a cost for various types of rentals with with the city. So are you saying those costs would increase?
Yeah, so dad's pulling it up right now
And so let's first look at an example, for instance, on the founder's dinner.
So, Dad, if you can kind of make it a little bit bigger.
So...
It would be appreciative.
Yeah.
So the first column shows what they received in 23-24, so 1,600, right?
And then what are they asking for this year, 8,000?
Well, in option number two, what we're recommending is 2,624, and so that just represents
the city's facility fee so it's basically a fee waiver and not above and
beyond to cover the event itself. Now to go to another example within the same
sheet you asked about the Freedom Fest. Now Independence Day celebration, last
year the allocation was 45,000, they've asked for 70,000 and we're
recommending 70,000 for the event support to cover the additional costs for
facilities as well as for public safety. Chris, would you add anything to that?
Maybe just one more example to be helpful. So I know we've had someone speak on it.
So the Poppy Jester Jasper Film Festival in option one, there's no recommendation
for funding at all because they have received funding but not long-term.
So they're not recommended in option one. In option two, they are recommended for
their facility use fee only, which is covers the playhouse, and that was $3,700.
What the speaker asked for was in addition to that $3,700, they were hoping to get $1,300
more above the facility cost to pay for, in their case, program supplies for banners
in the downtown.
So in order to fund them at a higher level, the council would have to say they want
to fund that specific project to a higher level.
To fund them at all, you'd have to use option two.
Not fund them would be option one.
And if option one was selected to keep us
at the $200,000 recommended, they wouldn't receive funding
even though they have recently in the past
because only long-term events are funded under option one.
So when are we going to make a decision to look
at these options?
Is it going to be in June?
No. So the intention is for you
to make a decision tonight regarding how to allocate these funds.
Now there are the five options that we gave you and one option is to come back with, you
know, if you want to, the council wants to change the priorities and wants us to look
at a different way to allocate them.
So we're looking for the specific allocations, you know, as well as of course the total
dollar amount.
So we're looking for directions so we know what to incorporate into our budget that
that we bring forward on June 19th,
in addition to that, to notify the community groups.
Would you bring up that slide again with the options?
Yeah, so if we could go to the page
that just shows each of them.
Yeah, so those are the different options.
So can you make that bigger?
So the option that makes the slight increase over time
200,000 to 238. How would that affect our budget? Do we have to take away X amount of
money from our budget in other areas to do the extra 30 years?
Yes, so that's a good question. So it's an additional 38,000 that's being requested,
And it is a one time increase and so, you know, I think we could probably absorb that into the recommended budget, you know, without having to reduce others but at the same time council could say go forward with option two but find savings elsewhere.
Okay.
Thank you.
Anyone else?
You know, we've done it about two, three years now.
The only unknown always is we don't know which new organizations comes with an ask, right?
And then I find it extremely unfair that they might have a great event, a great idea,
might be new, they might not have known about our city processes.
And just because we put a policy in place,
I won't, and long-term funding that was already in place
will be funded, and all the future ones will not.
And I'd like to see some modification
that is open to, if there is a good idea,
a great research coming in for an idea,
and the majority of the council says,
yeah, let's go for it, that we can use
that the fund allocated for that, maybe then with some trade-offs, right?
But instead of just saying, oh no, we're not going to look at anything else anymore.
That's where, over the past few years, we always had the most discussions
on those additional requests, right?
With that, Renee, if I may, the, the, I'm with you,
and I think the, I mean, we get a lot of requests,
we try to fulfill them all, we take up that $200,000.
I would like to find some way of however we can do it, sort of peeling some of that back.
I'd like to find a way of maybe allocating 170,000 and then setting aside 30,000 for council discretion for those kinds of things.
There could be a new idea that comes forward that we would have some money to play with throughout the year
that might enable us to help fund something and get it started.
That's exactly where I'm heading to.
We'd have to cut some money back elsewhere.
I might be a little bit more generous.
I think it would leave it at current level
and then just add another 30,000 or so
for unforeseen or something,
or 50, I don't know what's reasonable.
I think 30,000 is pretty reasonable.
Just that we have a little leeway
for something that comes late that we don't know of
instead of just turning a great idea just down
just because you don't know if it comes after there's no coming.
Yeah, yeah.
So that's a tweak you might be asking for. So it's kind of a one or two with modification.
Right, right. That would be like option. Is that option five you're talking about?
Four.
No, it's one or two with this modification of adding, let's say 30,000.
Yeah, it's a modification to one of these.
Yeah. Yeah. That's a one B or a two B. It depends. Okay. Which one of the two we go for, like, if I can make just a comment. And I think the premises totally fine. I just speaking on our team that manages special events. We need a six months advance notice to plan an event outside to just fund an event.
So, in order for an organization to come forward and know they're funded and then plan the event to meet the criteria that the city has to plan and implement it safely,
that's why we do the process once a year planning for the next fiscal year because that allows people who have received funding to plan their event which sometimes costs them money.
So it doesn't mean that we couldn't allocate money as we go along like the council member saying,
but it would almost be for the following year because we can't just allocate money and do an event the next month.
And Chris, so what we've got here, what we're approving though is for two years.
It actually is a funding level for one year and then we bring this back at mid-cycle
and you make the specific funding at mid-cycle for this on an annual basis.
And see, that's where we could have some wiggle room to fund something that comes up.
Right.
And I think so they would still follow the annual funding process of applying in the
early part of the calendar year.
I know, but there are those things.
And I think, again, I think we're all experiencing it.
There could be one of those ideas.
Now, again, we would have to explain to them just because you come to us today
doesn't mean you get to do it tomorrow.
But I think what we're, at least a few of us are looking for a little more flexibility,
at least some options that were not so dedicated to this money.
And part of this means that at some point in the future, as we go forward,
we're going to have to say no to some of these nonprofits who are coming forward
saying, I want to do this.
You know, we're going, hey, we're setting aside money to do something different.
I don't know.
I mean, I think we're looking for some flexibility.
Yeah, that's my point.
I think for the standard option one or two, again, we have to decide which one of the two.
But there should be that additional amount where we can be flexible, and if the council
majority thinks that we're okay, then the rest of the policy wouldn't apply.
That's what I'm trying to say.
And again, what we're good to call it is council's discretionary fund, if you will.
It can only be used for what we're dedicating here with these community events.
But maybe it's something we feel like, hey, maybe that event does need an extra.
Or I don't know. I just feel like I just I felt like this one was it was you know, we
Limited options. I say there's plenty here, but I feel strongly about making sure there's some flexibility for us to have some discretion
May not work out, but but we're I think we're looking for some some answers
I would just suggest I think to get to that point because I just want to be kind of frank to get to the council policy
on funding was not easy for
So if we come back and change it and people can apply later, we've had difficulty with
that.
So it will be difficult for the council and it will put more burden on staff.
I get it.
And then we'd be jockeying for, yeah.
Attachment three, just by the way, is the policy that council put together.
So it's policy 2102.
Okay.
I think the discussion on, I mean, as we look at prioritizing this, we have looked
because we haven't had enough dollars to fund the 400,000 we've looked at what
past events have had so there are increasing costs to run the 4th of
July event the holiday light
Parade event. So we're recommending increases to those, and option two, if you
want with it, would provide no funding for new events. And there are new events on
this list requesting funding. Yeah. So I think that discussion on do you want to
stop doing some of these long-term events to fund new events might be
something you want a discussion you have outside the budget process to. Exactly.
I'm just going to say that might be the thing to do is that we go for one of these options
here and then we continue the conversation leading into the next budget review or something
of that effect.
That's option option two.
So I like the idea of having, you know, looking at how many people applied, the 408 is
the total applications, and then looking at the options we're considering, which
which is under the 200,000, and then option two, 238.
The others talk about if you wanna give some room for some,
but giving some room for new ones.
Going back to what I said earlier,
I think I would like to have us move
the historical society maintenance
to a park maintenance fund,
which would free up another 20,000.
And then we would be able to do option two because that would now be two to 18.
And we would have a little bit of room for some of these.
I see a few of them that have zeros that are new that didn't get any kind of a consideration.
I think it sounds like from what you're saying, you know, there really would only be six months left if it's six months out from here.
You're saying it's six months to plan or you need six months or I heard you say that the application is due the full application is due six months in advance.
So organization would depending on the type of event, but it could be four months or six months, but the event organizer will need time to actually put that application together.
So it's longer than that.
Okay, so if we were to move that 20,000
Which is not for an event or you know that could go into our park maintenance fund
And then we could have it would be
218 there was talk about increasing it to 230 so we would still have another
12,000 that we could allocate or staff could allocate look at giving to some of these boys and girls
Cal North
There's a couple of these blues festival that didn't get anything I just be clear. We if it was allocated out
I believe it would be allocated to the general fund because the park maintenance fund. There's a spend-down plan and it will be depleted in
Approximately six years so we wouldn't be able to
It would be the general fund expense. Okay, where will all the maintenance of our parks go?
So I think we answer this question
And so right now the park maintenance is funded
from the general fund with a transfer
from the park maintenance fund annually
to offset some of the costs.
When that park maintenance fund is depleted,
if it gets depleted,
remember the reserve policy could put money into it.
That's part of the policy you were discussing.
But it will likely be depleted at some time
and the general fund will then take on
the maintenance, the park maintenance fund,
which I believe our finance director
has shown being transferred to the general fund
after the depletion of the park maintenance fund. Okay, so for purposes of where it would
go, it would go to the park maintenance fund. It would go to the general fund. Okay, it
would go to the general fund. So I say we move that out where all of our other park
maintenance sits. It just be noting where it sits, what division it sits in. Instead
of sitting in the council division, it would be sitting in the park maintenance division,
but it's still the same as that cost to the general fund. Okay. But it wouldn't
be in our community promotions and so I think it should move to the park
maintenance or park delegation in the general fund and then we would have this
12,000 that we could still use for new programming. You would be if you did that
the impact on the general fund would not be the increase of the the dollars
to the 38,000 it would be the 38,000 plus 40,000 so you would be impacting the
general fund by 70,000 because you're just shifting it from one
to the general fund to the if I understand what the option you're
saying correctly you say you want to go with option two which is 238 take so
that would be adding 38,000 above or close to 40,000 above the staff
recommendation so that's $40,000 increase in the net impact to the general fund
then if you take that $20,000 out... $18,000. Right? Yes. Yes. But we're talking about adding $30,000 for new programming so we would be looking at $2.30 already for community
That's what I heard from my colleagues.
I'm not sure I heard that, so if that was the plan.
So if you put the community promotions at $230,000 and you put $20,000 more into the park fund,
that would be a net impact of $50,000 through the general fund.
Right.
Above what has been shown.
Yvonne, we're talking about the $33,000, or the $30,000 I was suggesting?
Yes.
Yes, and Renee's also talking about for new programming.
Yeah, my work's reducing his was adding, so it's maybe a combination of the two, but
whatever
it might be.
Right.
Either way, it's still in expense.
So that's, I mean, that's what I'm looking at.
Okay, and I've got some thoughts on that as well.
One of the questions, I'm sorry, if you're done, I'll go.
I'm done.
Thank you.
One of the questions I have is, have these organizations, who are coming back second,
third, fourth time, whatever, have them at the reporting criteria, which is on page 12
of this packet,
which indicates that within 30 days following the conclusion of the funded
activity, the organization must submit a report to the city reporting out pertinent
information related to the activity, for ongoing activities.
I mean, do you have that?
Are they doing that?
I don't believe everyone meets the 30 days on it, but everyone meets the criteria before
they would get funding for the next year.
And so we do collect those reports.
Sometimes it takes more than 30 days as it's volunteers working on it, but before they're
funded for the next cycle they meet that criteria, they do, or else we would be
noting it.
Okay, and that including the funds and the statistics and information that provides
details on the activity's impact to the community?
Yes, and within their applications, a lot of them have used the same thing they've done
in their report to put in their application for the next year.
So you see a lot of what they – it's in their report in what you – if you look
on the links.
Okay.
But at least they've met that.
Okay.
For me, I would like to go with option one and include the additional 15,000 that
is being asked for for Villa Mera Monti on top of the 198.
What
we're going to settle on here tonight, I think we have different options that I don't
even know where we go from here on Gino, any thoughts on where you want to go with this?
If you could just explain what you just said, so you're saying you would like to go with
number one, but add 15,000 to it, so you can comply with the Miramonte request.
As opposed to option number two, which will fund what then?
Well, option two is what's listed there.
It's 238,000.
But what are the other programs that that 38,000 basically is going to fund?
Well, Christine.
So, yeah, so to add and look if you could pull up the summary page.
And so what you can do is compare the option one and the option two columns.
And so, just going down, you could see, for cars.
Could you tell me what page, I'm sorry to interrupt, could you tell me what page that is?
Yeah, so this is...
Do you have the agenda packet?
Yeah, I do.
If you do, that's, yeah, it's page 16.
Item two is, right, option two is page 16 of the agenda packet.
Yeah, so we would just go side by side, and you can kind of see the difference between option one and two.
Oh. Yeah, what page of number is that?
205, you said, Monica?
Yeah, but of the packet, 205.
Two of five. Two of five.
Oh, but in agenda packet.
Okay, so basically if we're looking at option one versus option two,
you can kind of scan through and see what the differences are.
So, Karas, there's two events that would be funded under option two.
Same thing with the shabbat.
you know healthier kids stays the same and you would just kind of go down and
see what additional events are being funded or sponsorship.
Okay I better
understand it now and I you know I again I truly wish that we can fund
every single request but you know we have a finite budget that we have to
comply with and and it's very difficult because we have to be careful not to
take it out of the general fund and trying to be considerate about what's going to happen
in the future, which we don't know. So I really like the Mayor's recommendation of doing it
that way.
And really, there's no action here. Or is there? I mean, what are we doing?
There's no action, but what we would like to get from Council's direction, one, we
We need the total tech to incorporate into our recommended budget if it's something other
than the $200,000 or basically option one.
Right.
And then second, if there's consensus, then we can move forward with letting the organizations
know.
Got it.
I don't know if we have consensus.
Any thoughts?
Well, I certainly would not have any consensus with doing option one considering that it
That does not include any of the Nueva Esperanza holiday posada or the Dia de los Muertos event,
especially on the hills of the economic mobility that we're kicking off in a few weeks.
So again, could we we could make modifications so we could say item one or option one with
But again, my deal for the $15,000 plus funding for those two items there, that we can even
do that, right?
Okay, so.
There's also Poppy Jasper.
There's a number that aren't included in that.
I know, I know.
I don't know where we're going.
Poppy Jasper is one.
It's, I mean, look how much they've grown.
They've got to our community.
We talk about art and tourism, I think.
Like my, my notice to go with option two, if we're not looking, you know, and if we're
not looking to do, I was trying to also make room for the new opportunity for new groups
because I think they're very important in looking at some of these that have put in
and unfortunately, you know, they don't make option two.
And so I thought by giving, you know, by moving what truly is an operating maintenance
into the general fund and we keeping this promotions it won't not be funded the
historical society it would be funded but it would be in a more appropriate place
and then we could have a little bit of room if people aren't looking to do
that you know then we won't have room for new for new ideas then I
absolutely think it has to be option two yeah I mean again I would still
Again, if it's option two, I'm going to lobby for the additional money for the historical society.
Again, whether we move it from here or put it over here, it's still an impact, it's still an expense.
If we did move it to the operating fund, that would be something we would continue to fund every year.
I would assume there's no...
I think on that end, I think that's something staff, this policy manager, we could discuss
If it makes more sense if that's the if the council would like us to look at that before yeah
I mean it again whether it's out of one fund or another my goal is not to not fund the historical society
My goal is for us to fund it appropriately and to gain the revenue that we think I don't know that it's inappropriate
But I get what you're saying is there is there another option available and it certainly seems like there is it's whether it
Again as long as they got the money. That's what's necessary for our
our asset so
Well, I can be okay with that, but again, I want to make sure that we're including the
additional 15,000 that they're requesting.
Renee?
Yes, so I understand where my colleague is coming from and it kind of sticks out like
a sore thumb that ongoing maintenance when you look at what everything else is for, right?
This is really the goal of that fund, community fund or whatever we call it, was to help
book is saying we're specific events right not for ongoing maintenance of
anything and I think we should give it back to the city to look into where
where could that get moved to including it if we we think it that it should be
up by another 15,000 I'm okay with that and I think that's doable it's not a
huge amount but I'm sure there's some some buffer any budget has buffer
have a background in finance, I know that. So, see, she's smiling, so, gotcha. I think
option two is for me they're the better one. You know, when did we create that budget three
years ago, four or five years ago? Yeah, the policy was in 2021, so probably right.
Yeah, and, you know, things got more expensive for anyone, right, since then, including
We're raising the fees too, and I think it's only fair to kind of balance that out.
The additional cost that some events just occur. And if we can help a couple more groups
as well by doing so, that's perfectly okay with me. So I will go with option two, but remove
the ongoing maintenance part. So that might lower that amount unless we want to use those
20,000 then for discretionary spending by the council, whatever you call it.
Yeah, yeah, we call it whatever but no, but if that requires a policy change first
And we I guess we'll have to schedule the policy change first and then right that will trigger that change
And maybe that's something you look at for next year when we bring it back at mid-cycle for the second year. Do you know?
Thank you mayor
so
Chris or Christina or whoever what would be the
pros and cons of moving
that maintenance fund somewhere else? I mean is this actually doable or would it
cause some other issues going forward relative to ongoing? From an accounting
and budgetary perspective it is a use of general funds so right it's a general
fund expenditure whether it's in here or whether we put it in the general
fund maintenance budget, right? So, I think the intention was to bring together all funding
to outside organizations, even though Villamere Month is a little bit different because it's
our asset, all through one process in one area, so it's all combined, you know, and
we do it annually. Chris, anything you would add?
Yeah, I think, yeah, as you mentioned, that's the pro of keeping it in community
funding, the pro of moving it would be an ongoing park maintenance expense, and there
could still be a longer term agreement with Villa Maremonte, so I mean the historical society
for Villa Maremonte. So I think that could be the pro of the other piece, to provide
them more stability in the funding.
Yeah, so they're not every year coming back saying, hey, can we get this? Yeah. Yeah. Yeah. I mean, I just exactly why I asked to move it because it's more appropriate.
I would think that the historical society would appreciate that if they're part of the city. But having it in our community promotions does not seem where we're going.
being funded as part of parks is ongoing and I think that we want to have that
ongoing again I'm not trying to defend it I want it to work as an asset of the
city and if we're going to be investing in that then we need to see that be an
asset of the city make sense yeah I think we get it do you know you would
I mean you had indicated option one was something you would be open to doing this option two.
So what's the question you're asking me?
So the option two would be, as you see it on the page, we would move, and I don't know
how we're going to do it.
I'll leave that to you guys as experts to move the 20,000 for Villa Maramanti out
of option two.
That would go somewhere in the general fund along with the additional 15,000 they're
asking for.
Yeah, and I'm perfectly fine with that.
Okay. We'll let all of you work out.
Sounds like we have consensus.
Yeah.
Probably option two, but with a lower amount.
So it would be two, 18.
18, 331.
So does that mean there's any room for these programs that are new that have not received any funding?
It would just require an additional general fund contribution.
Of about, what, 10,000? 20,000.
It would be per event that you would add funding if you choose to, if you look at option 2 and
you look at other events that are new that aren't in option 2, you would look at their
funding level and add that to the increased dollar amount, which we're funding with
the
15,000.
So it's basically above the recommended budget.
It's the about 40,000 above the recommendation, plus the 15 you added, so you're at 55 above
the recommendation right now annually.
So what if we moved out the 20,000, that takes us to 218,331, right?
and if we added $12,000 for new programming, then that would take us to $230 here and the $20,000 move to the general fund.
$20,000 plus $15.
That's $35 plus the $12 you mentioned.
$20,000 plus $15.
So there I think
What the mayor just mentioned was we'd move the 20,000
He is and other councilors are interested in funding the additional 15,000 that they requested
So it would be a thirty five thousand dollar
35 plus. I think Renee you mentioned 12. So I'm sorry if on
35 that's 47 nearly. Yeah, that's 47,000 additional
I'm sorry. It's actually no not 20. So it's
to be 27,000 additional, right?
It's 27,000 additional plus the,
if you choose option two,
it's above what's in the budget right now.
So it basically is, I think if you add the 12, it's 67.
I'm just saying our total would be 230.
We would take out that 20,000 for the Morning Hill Historical Society and put that under
parks in the general fund.
No.
So if the total is 230, that is about 30,000 more than the recommended budget.
So there's 30,000 and then there's 45,000 being put, sorry, 35,000.
There's either 20 or 35.
So there's a difference in discussion.
The mayor is saying funding the historical site at 35,000.
You're saying just the 20,000 they're currently getting.
They asked for an additional 20,000.
The 20,000 is in option two, right?
Yes.
So that's there or here.
It doesn't matter.
That's not an additional 20.
Correct.
However, if we keep, if Yvonne's saying let's keep that at,
if she says let's keep it at 230,
then there is additional, yeah there is additional money.
Right.
I'm saying keep it at 230. You move the 20,000 out, which means you're at 218,000. You have
about $12,000 to provide to the other no ideas, which is.
And what Chris is trying to capture is what is the total impact on the general fund.
Yep. Right. But in the option two before us, those 15,000 were not in, so that's why
I'm talking about the 20,000. I'm okay to add the other 15,000.
But then the $35,000 goes somewhere else.
City manager will figure it out.
There's that for how to handle it.
Yeah, that's one request.
And I think what you guys will do is come back.
I mean, because we're trying to figure this in our head,
you guys will come back with, OK, here's
what the actual impact of the budget is.
Yeah, well, I mean, I'm saying $20,000.
I'm not saying $35,000 to move that out.
I'm just saying the $20,000 that is here,
that we move that out.
So that takes it to $218,000.
What I just said, yeah, the 15,000 is an additional that's not part of this. That's not part of it. That's not part of it. Right, right
We can't take it out. If it's not in here, right, right. Oh, I thought you were saying to add it in. I'm sorry
Whether it's added in here or added somewhere else, I think we need direction on the 15,000. That's right
I think you have the director. I think I want you to come back for the additional 15, right?
I'm not. I heard council member spring is okay with it and these two are okay with it. So we have three that want the additional 15 so we'll have 35,000. We'll find a home for it. Okay. And then from a community promotions perspective, we have 238.
Okay, back out the Villa Mayor Monte and then the decision is okay. Do we want to backfill that like do are we picking up other events. So Christina just want to back up because that 15,000 just came in.
two days ago so I don't I'm not sure why we're including that in this that might
be something to look at at another time but we're looking at what was here and
the 15,000 just came in again two days ago so why are we just including that
and all of these others are getting bypassed no they're not getting by
Well, they're not going to all be funded.
I can tell you that.
Not to see they are.
So no, but I'm talking about all of the others.
That 15,000 is not competing with the 6,000
from the Boys and Girls, from the Cal North $9,000,
from the, I hope you're seeing my point,
from the $3,000 requested from the Morninghill Boys
and Music Festival.
So that just came in two days ago.
And I don't think that's not considering any of these have been told. No, I understand that I am saying I'd like to fulfill the
Request made by the little mirror Monty to other council members are okay with that. And so that's why it's moving forward
And you're both okay with passing up everybody else
Okay
Okay, very good
Then we will now there are no other comments
Don't open this up for some public comments here with regards to this topic here
any public comment well
first off I want to say that oh five seconds so first
off I want to thank the City Council for providing the funding it's very
important for the community not only does it allow some events to take place
that would not otherwise but but it also teaches the citizens that are
interested in funding some of these events or putting together the events
to have the ability, and it really fosters our leadership.
It really fosters coming together as a community to plan the event,
to go out and hire the people that are going to be participating and providing services.
And so it's really very, very helpful to the community,
and especially for people that maybe don't have the resources.
It would not be able to put those resources.
is that historically the whole reason why this came into being
is because we wanted to give the community an opportunity
to put together events and get the funding necessary.
So whatever you decide, I mean, I always look at,
we have a limited budget.
I know we're not in the best of times,
but whatever you do, I do wanna thank you
for allowing the community to participate
in this process of events that are so good for our community.
Thank you, Armando.
Thank you.
Good evening again.
I'm not going to try and help you choose anything.
I'm going to try and complicate your life a little bit with two policy proposals.
The first is I'm somewhat in agreement with people who would not give priority to existing programs and events.
My model is that we rotate those grants each year through a different set of applicants
which allow them to demonstrate to the community their value and perhaps therefore encourage
more external support for them taking, you know, the city out of the, someone out of that process.
The other thing which intrigues me and might be a little difficult to do, but both the county
and the city of San Jose allocate some funds to each of their districts and I like that
idea. You could keep some for your more popular events, you know, and allocate other funds
out. I mean, it can work. Rumor has it that's Supervisual Arrhenous. Some of her budget
inventory items are actually going to come for Morgan Hill this year just kind of putting
my thumb on the scale on this idea. And that's really all I wanted to say. There are other
ways to do this. There are some pretty strong feelings about who should and shouldn't get
funding and that would allow you to have a little flexibility and not have to always
have consensus. Thank you, Doug.
Thank you.
Good evening. Thank you for the great discussion. I agree with your decision in leaving the
funds for a very, very long time to another budget, the general budget, it seems to make
sense for me. Since the president isn't here, I'm the past president, so I am not speaking
for the historical society. But to address a few of the comments that were made, the
society is run by many dedicated volunteers. Speaking of rentals, right now I've taken
those over for someone who no longer can handle those, I spend four to six hours of my time
for each one until it takes place at that building. And it involves a lot of knowledge
and awareness to be able to make those things happen. So without the funding and the people
to manage these kinds of things, a lot of things that could happen do not happen.
So we're funding good management of general management.
There's a lot more that could be done there.
But it takes people passion and dedication and funding.
I'm going to do that, so I thank you on behalf of the historical society for all of your support and what you've done. Thank you.
Thank you, Kathy. For
comments, Christina, I'll turn it back over to you.
Okay, so our next and last item is the council funding, and so I'm going to ask that and I'm going to flip it back.
And so included in your packet, let's see.
Yes, I'm just not speaking into it.
Attachment number two is city council supplies and services and so this is a
breakdown of council's budget and so this is everything other than personnel
and what they're going to show up right now show right now includes personnel
and then all of the non personnel items they start with community funding and
goes down to internal services and transfers so the total recommended council
also budgeted $502,000 in the first year and $540,000 in the second year.
And so one of the areas I wanted to bring to your attention is in conferences and meetings.
In past years, this was broken out between training, conferences and meetings and auto
mileage.
We've combined them all and we've added approximately $7,000, I believe, to that.
And so the number now is $25,000 in each of the given years.
And so what we're proposing is that 10,000 of the 25,000 is for the annual
lead conference and so that assumes all council members go and then in addition
to that the remaining 15,000 is basically 3,000 per council member to
include conferences and meetings consistent with your roles as council
members any associated training and auto mileage so basically 3,000 per
council member which to date none of the council members have exceeded that
amount so that's what makes up the 25,000 and with that I turn it over to you Mr.
Mayor. Thank you. Any questions or comments regarding this item?
I did not know that we have expenses for council member cell phones. So yeah so
So attachment number two is a thousand dollars in each year and that's just for one council
member has a cell phone.
Okay, and that's approved by the city council?
So it has been historically part of the telephone budget or just it's come out of the total
council budget but it was requested to have a separate phone and so we've done that
and so it's included it's you know it's a thousand each year yeah my point is
these kinds of special decisions should minimally be decided by all of us not
I I don't know who got that it wasn't me I don't need it I would not have
approved that if it would have come to the council as a decision same for
iPads or so, most of us have an iPad anyways, right?
I don't think we need to charge the city for that.
So I just wonder if there's a couple thousand here and there
that we could cut out.
Yeah.
Could you switch this slide to Attachment 2
to see it at that detailed level?
I am looking at page 9 of the package, by the way.
It would just, I think, be helpful to have it up
on the screen to what you're looking at.
So this is just a breakout of the non-personnel for council.
And so, you know, line by line.
So historically, telephone council members just typically use their own.
It was requested to have a separate one, and so, you know, we've done that.
And with iPads, and we, similar to staff for iPads, we, for council members, will buy them,
or you have other options if you want to use them for your own personal use too,
then I think we do a stipend so it's less than this. So there's different
options that are available.
I personally would remove cell phone iPads for
council members. That might have been a good idea ten years ago but now all of
us have those kinds of tools anyways.
Any thoughts?
Well I I just don't, the
The iPad is a critical function of what I do on the Council.
So are you saying to remove that option for Council members?
The iPad?
Yeah, you still can use your iPad.
I just use my own, yeah.
Well, this is my own now.
Well, I mean, it would be once you, you know, when someone leaves the Council, do they
get the iPad is turned back in?
Yeah.
Right.
So the cities, yeah.
Yeah. Yeah. Yeah. So, yeah, I don't have an iPad either. I'd have to go out and buy one.
I wouldn't be opposed to it. I've got my own cell phone. I pay for that.
Yeah. Yeah, me too. I'm with you on the cell phone. I just don't think that that should be an
option.
What should there should not be an option? Sorry.
The cell phone. I mean, if it's not offered to everybody, then it shouldn't be offered to one.
But is it offered to everybody?
We have not had the request in the past other than the one that's here.
The one council member asked to have their own, a second, a phone.
Just deal with just city business.
But as council member spring indicated, nobody knew about it.
So how do you ask for something if you don't know about it?
Good point, good point.
Who has the cell phone?
Yvonne please go ahead. Thank you. So I think that both of them should be
allowed for iPad or for the cell phone. I did know there's an allocation for this
and I did ask for the cell phone. I have when I first started on this I was
asked and am asked many times for my contact information and there's often
in times where I feel very uncomfortable giving people my private cell phone, especially for
a man, I just, I feel uncomfortable with it and that's why I've asked for it.
By far it's not anything sexy, it's actually a very, you know, simple and with a terrible
battery but it does make me feel comfortable because people that I don't know, I can give
them that number and they can reach me there.
If they you know this person wasn't satisfied calling in and they oh you just send me to voicemail or what have you
so
That's why
And I do think I mean I use my own iPad, but it you know my case
I've replaced quite a few times in the past six years
I drop it and use it often and I think that we should as council members. We should have those things
We dedicate a lot of time we do a lot of business. We're in a lot of meetings
Like I said, I don't personally have it, but I wouldn't be opposed if somebody did.
Yeah, and I, to kind of back you up on that, Yvonne, I really don't have a problem with you having a cell phone.
And for that very reason, you just expressed safety concern.
I'm not concerned about that, but I can understand where you might be. Totally understandable.
I do think these are tools that council members need to do their jobs.
Absolutely.
So I do think though, if we're going to offer it up to somebody, then maybe there's some
sort of an offset for, you know, again, I don't have a problem paying for my own phone.
I just don't.
But maybe then that the option is there's some sort of offset for those who do use their
phone.
Again, we're just adding more and more to the budget.
I get it.
But I think these are tools that we need to have to operate and so, and I look
at that, I mean, a thousand for the cell phone is a very small amount compared
or do a $200 million budget, so.
And there's often, I mean, this is my Mac,
this is, you know, I have my iPad when I take meetings.
I often have, I have my laptop where I'm taking the Zoom.
I have my iPad where I'm reading my agenda.
I have my phone, you know.
I mean, these are things that you have to use.
The ultimate multitasker, yeah.
No, I get it.
I would be very comfortable leaving these in place.
So my point is that we should have a policy agreed to that applies to everyone.
Sure, absolutely.
It should not be a case-by-case decision. That's what bothers me here.
Yep, totally agree.
I don't care, it could be my own. If I had received a phone and no one else, I wouldn't like that either.
That doesn't sound right to me.
And I think if there is a policy that the majority agrees to, I have no issue either.
they're right. But it should not be made with a staff decision, singling out, and then the
other consulings don't even know that that was an option.
Right, right.
And that is something we can move forward to develop the policy. I mean, I think that's
what's being asked for here.
The problem I have a little bit with that is if the city pays for it, then you
only can use it for city purposes, right, and really should not use it for anything
else.
Yeah, I don't know how you control that so I
Will just say I asked for that. It wasn't offered
I asked for it because of safety was the whole reason why I had first asked for it
So I understand your point. I'm just saying that's I know we're getting your second phone
I have an easy one anyone can do that for probably for free
Okay, so I think what we need to do on that is we will develop a policy and that again
Maybe that is the direction. We're gonna send staff back with to come to come forward with something
that would be equitable.
Okay, very good.
I think that we'll make it clear, and also,
if there's a good chance there will be new council members coming,
then they know, right? Yeah.
Let's be transparent about our policy.
We'll bring that forward at goal setting.
Okay, so anything else on the...
The only other thing I wanted to just clarify was
you said that there was 5,000 per council member.
3,000.
Well, that's without the annual...
we all go to the annual conference.
So altogether it's 5,000 and I know for my you know for me
I do go over some of that now that I've taken on some of like a go up to a bag for San Francisco
So and I know that some of that mileage does go over
So I just wanted to make sure that cannot cross over to different council members if there's a little that's over
Well, so what we're proposing is that it would be three thousand per council member our clerk's office
would maintain an online sheet that you can all access to see where you're at.
So it would just be 3,000 per council unless the will of the council is to say that it can roll over,
you know, if one's less than the other can have more. I mean, it's up to the council.
Well, okay. So, like I'm saying, the mileage just on driving on that is already, you know,
That's already a significant chunk of that, plus for the league, whatever that might be,
registration, we have a end of the year dinner, we have registered, we do like four a year
for the league where we go and we heard about ballot measures today.
So how does that work then?
So we budgeted 7,000 in total more than we've had in years past, right?
So we've already budgeted more and the three thousand was a number that we came up with based on looking at
Expenditures in the past for council members as well as year-to-date
No one has exceeded or come close to exceeding the three thousand and that's why we're recommending that amount
okay, so
If we have that twenty five thousand, I guess what I'm asking is is there room for us
to if somebody's not using that for it to go over. That's what I'm asking. Can that be something that is fluid?
If I can just jump in. I think what we've got to focus on is the 15,000. The 10,000 is really just for the annual
conference. Yeah. So it's really only 15,000 that we're talking about here. Okay.
Yep, so. So I'm looking for council direction here. No, for what I come from is I think we it's 3,000.
I think that's, I think that's sufficient for each of us to work with.
And I think you've got to work within the means.
And that's what I'm saying.
If we have council members that have not used that, then are we able to use those funds as 15,000 for all council?
I would recommend no.
I can cover that.
Everybody has to keep within their means.
is some things that I don't do because I don't feel it's a high priority, and so I have to
prioritize a lot of the things I go to.
And so I have to manage everything.
So if it's per council, 3,000, you have to manage that within your 3,000.
And it's not, you can't cross over to another council member's money, because that means
You can cross over to two council members money and it's just not it's just not not not up. It's not even a fair thing to do
Yeah, ready any thoughts
Okay, I
We're looking at we spend ten thousand dollars
for everyone to go to one event and then we're saying we're spending for one event for
two and a half days and then we're saying that we're gonna spend
$15,000 for everyone to do their business for the rest of the year.
$3,000 each, correct.
That doesn't seem to add up.
That's up for me.
I won't even come close to that, probably, but knowing that that money is there, I might
actually do some other conferences that I have thought about not doing in the past.
Yeah.
So what I've used it for, I can tell you, is for the League Peninsula Division event.
So the end of the year dinner which most of us go to
The League annual conference in Long Beach. We all go to the, um, policy,
League policy committees in Carlsbad. I think three of us went to, uh, they have League leaders,
which was in Barbank. Um, I was probably the only one that went to, well, this is, this includes.
Even with that, we have not exceeded the amount that you had talked about. So,
if you let me finish, I'll get through all of it. I have the Latino Caucus board retreat.
I have conference and meeting registrations for those that I just talked about.
Flights, hotels,
and the mileage alone driving from here to San Francisco and to Silicon Valley Clean Energy
and to VTA, chairing the PAC Board.
You know, that alone is $2,200 just right there.
House member, don't you, you do zoom meetings on the Silicon Valley clean energy?
No, I go in person to Silicon Valley clean energy.
$1,200 equates to nearly 4,040, 4,500.
I go in person to Silicon Valley clean energy.
I thought we set it up here for zoom.
Silicon Valley clean energy.
That's for executive board and once you're out, yeah, once in a while I do do executive
board here.
What you're describing has still not exceeded the number that Christina has described.
I think the three thousand is sufficient the extra ten thousand dollars for the league conference three thousand eighty
I've submitted a detailed report to Michelle and Christina and it does exceed the three thousand dollars
Well, then you'll need to manage that differently if we if we approve this
You mean I wouldn't go to I wouldn't be able to do any of my outside committees that I'm assigned to
for the city.
No, you will.
No, I won't.
It's the other ones that you'll have to consider.
No, that's what's included in here, Mayor.
That's what I'm explaining.
Yeah, exactly.
And none of that has gone over the amount of money that Christina has just described.
Many of those are new.
And so that's, you know, what I have very small children, so what I would do so that
everyone is aware is I would wake up at 4.30 in the morning, make lunch for my
kids, drive to Sacramento, go to the conferences all day, go to the dinners,
finish at 9.30 at night, drive home so that I could be home, get everybody's
stuff ready for the next day, get up in the morning again at 4.30 the next
morning, drive up to Sacramento and come back while my colleagues were staying
in hotels. I did that for a year so I didn't have any hotel stays. I actually
saw you with your family in Sacramento. That's right. That's right. That was
one of the times and I think you spoke to my mom and she told me, yeah, I came so that
she could do. So I took my mom with me to watch the children there. Thank you for that.
And so what I'm saying is for a long time I haven't been going and staying in hotels.
I would be making that trip back and forth, which is why now she's saying we're basing
this on the past and that is why now currently it has changed the girls are
now older I have taken my first night away from them just this year so that's
why you're seeing the change which includes flights because I wouldn't take
those before I recommend we go with the staff recommendation again we're
not taking action it's a consensus but I recommend that's what we do yeah I
I agree with that, and you know, when you take this job you know what it's entailed.
So I understand you're a family person and you're a mom, but you know what, you took
this job and you know what it was about.
So you're going to have to manage that.
Thank you.
Yeah, I'm somewhere in between, other than the league I don't think I ever went anywhere
or definitely always pay it out of pocket, I don't charge for miles or my train
tickets or flights when I go somewhere, even when it's for city business, the
annual conference is the only one, but this year I won't even go so that this
frees up a couple thousand dollars I guess right there. I have no problem if
you want to use my $3,000 to help my colleague here. I should be able to
make the call since it's allocated to me right actually no that's it's a it's a
we don't we don't have a policy but that's what we're settling on it's a
council decision and the council will decide how that how that's allocated yeah
but if I have $3,000 I can use then I can tell the city manager finance not
if the council help offset another colleague if Geno needs more money
I'll be happy to help him, too.
Well, if the council approves of that policy,
it doesn't exceed the budget.
I would like to ask the staff to go back with what I've submitted to you
on the cost that I have,
and see if you would stay with the same recommendation.
Yeah, and we're happy to do that.
I think the best thing would be just to submit actual,
instead of estimates, submit actuals for what you have so far this year,
and then I can work with the clerk's team
and figure that out.
And it should be tied to official assignments,
not everything else someone does, right?
And so when you say official,
not everything else.
You mean the outside assignments that get,
each year get assigned, yeah.
So in this particular case,
Yvonne started to use you for the example,
but you mentioned the Latina caucus.
That's not an assignment by the city.
You're saying that would not be covered.
We're saying, okay, yeah.
But that's a, that is not the, the just, that's not the majority of this.
The majority of this is league, like I said, league leaders, league policy committees.
I have SCRA, I have ABAC, I mean these are not the SBCE, I go up to Sunnyvale, that's
But none of those, none of those have exceeded the number, right?
To date they have not.
To date.
Okay.
Okay, well I think, I think, well, we'll leave it to you to come back with.
Yeah, I mean for budgetary purposes what I'm going to recommend is we're going to keep the 25,000 in the budget and then at the goal setting we can come back with policies on travel and then on iPads, telephones and conferences would be included in the travel.
Very good.
Thank you.
All right.
And nothing else being said. Well, again, I think maybe open for public comment on this
particular item and then we're going to wrap it up. Any thoughts?
Looks like there being
none. I think we've come to the end of the meeting. Is that correct? Okay. Everyone, thank
you all for being here. Meeting is adjourned. Thank you.
All right. Thank you.