[0:06] need to call us to order. Everyone,
[0:10] welcome to the August Finance [snorts]
[0:12] Committee meeting of the Sonoma County
[0:15] Library Commission. And I see all of the
[0:17] present commissioners received the color
[0:20] memo. And we are colorcoordinated today.
[0:24] So, you could tell who the commissioners
[0:25] are. And um let's see if there's any
[0:29] public comment.
[0:32] We saw there were no comments received
[0:35] via email. And there are
[0:38] I believe no members of the public. Let
[0:40] me double check.
[0:43] Okay.
[0:44] >> There are no members of the public.
[0:45] » There are no members of the public.
[0:45] Commissioner Angbart is watching via
[0:49] Zoom.
[0:49] >> Right. Thank you. Well, let us let me
[0:52] » Right. Thank you. Well, let us let me
[0:52] call everybody to order here.
[0:53] Commissioner Goldberg
[0:55] >> here. Commissioner Polls.
[0:57] » here. Commissioner Polls.
[0:58] Did we hear from Commissioner Polls? No,
[1:00] we did not hear from her. And
[1:01] Commissioner Taylor
[1:03] >> here.
[1:05] » here.
[1:05] >> And very
[1:08] » And very
[1:08] hearty greeting to Commissioner Taylor
[1:10] and Commissioner Goldberg for attending
[1:13] the first Finance Committee meeting. We
[1:15] welcome you and are glad you're with us.
[1:17] Um, announcements. I have the same
[1:20] announcement that I had at the last
[1:22] meeting which is my status as a
[1:24] commissioner has not been confirmed. I'm
[1:27] still hanging out here a little bit
[1:30] hoping I can continue but as of now I am
[1:34] acting under the direction of the city
[1:37] to continue coming to meetings. Uh
[1:40] public appearances we don't seem to have
[1:43] anyone. Okay. Uh let's move into
[1:46] discussion item uh 4.1 finance committee
[1:49] roles and responsibilities. I wanted to
[1:51] take just a little bit of time since we
[1:53] have our actually majority of our
[1:55] members today are brand new and talk
[1:59] about what we really are supposed to be
[2:00] doing in this committee because it isn't
[2:02] always clear I think to to people what
[2:04] we do. Um
[2:07] to back up just a little bit, um this
[2:10] this new library commission started 12
[2:13] years ago in August of 2014. And at that
[2:16] point in time, prior to that, the
[2:19] commissioners were appointed by the
[2:21] Sonoma County uh supervisors. They each
[2:24] could name a commissioner and then the
[2:26] city of Santa Rosa could name somebody
[2:28] and city of Paloon can name somebody and
[2:30] that was the library commission.
[2:31] Starting in August of 2014,
[2:34] all of this all the jurisdictions got a
[2:36] representative. That was one of the
[2:37] major changes that happened when this
[2:39] JPA was redone. So, um I walked into the
[2:43] first meeting and commissioner uh Tim
[2:46] May from Pedaluma walked up to me and
[2:49] said, "Would you be on the finance
[2:50] committee?" And I said, "Sure." And then
[2:51] I'm still I've been doing it all this
[2:53] time. It was very informal. We didn't
[2:56] have any roles or responsibilities. We
[2:58] were totally winging it. And um so just
[3:01] over time this committee has uh you know
[3:04] clarified its roles. We have great
[3:07] leadership now that we didn't have then.
[3:09] We had a brand new CFO, a brand new CEO.
[3:14] Both of them were new to the system.
[3:15] They have come and gone. And we have,
[3:18] you know, such a strong management team.
[3:20] Now it's a a different day. So you're
[3:22] you're walking into a a good well-run
[3:26] um you know financial department of this
[3:29] of the commission at this point in time.
[3:32] So, just to talk a little bit about what
[3:34] we do do,
[3:35] we do um we review the reports that the
[3:39] CFO prepares for us. And one of the
[3:42] important things I know there's been
[3:43] comments by commissioners. We don't know
[3:45] how to read them. We don't understand
[3:47] them. They're complicated and all that.
[3:48] And I think all of us want to make a
[3:50] concerted effort to make sure everybody
[3:52] can understand at least some basic part
[3:55] of things so you can always, you know,
[3:57] tell where we are. And we think all the
[3:59] commissioners should be able to do that.
[4:00] and hopefully that will come up at the
[4:02] retreat and go over some of the basic um
[4:05] basic reports that we do. Um we can have
[4:08] no more than five commissioners as a
[4:10] five as 11 member body. The five was a
[4:13] as a majority and um I believe uh a
[4:17] fifth person has been named but we're
[4:19] holding back for now until the Hillsburg
[4:22] commissioner gets seated. So, at the
[4:25] next meeting, I will or will not be
[4:26] there, and the new person will
[4:30] presumably be there, and I believe it's
[4:32] Commissioner Riley, is it not? Um, so
[4:35] anyway, what we do besides review the
[4:37] reports, um, the the chair of the of the
[4:40] commission may say, you know, I really
[4:42] want you to look at something, you know,
[4:44] some financial issue that's going on or
[4:48] something. It's poorly understood by the
[4:50] commission, whatever. So the the chair
[4:52] of the commission and this happens very
[4:54] very rarely can ask us specifically to
[4:56] look at something that I can't even
[4:58] remember the last time that happened but
[4:59] that can happen based on our role and
[5:01] responsibility. the full commission
[5:03] could say, you know, we don't understand
[5:05] such and such. Let's take it back to
[5:08] finance committee and let them hash it
[5:09] over and then report to us. Or any of us
[5:13] can bring up something that we're
[5:14] concerned about that we think would be a
[5:16] helpful topic to to look into. So, we
[5:19] can also put something on the agenda and
[5:21] we'll have the opportunity to do that at
[5:22] the end of the meeting.
[5:24] Um we don't necessarily do anything with
[5:26] all the stuff that we do but if the
[5:28] commission chair or um or the the
[5:33] commission or the or us ourselves we can
[5:35] make recommendations you know if if on
[5:38] upon request and so we you know we can
[5:40] do that. Um we also look at the
[5:42] preliminary audit when the auditors go
[5:44] through everything and we kind of go
[5:46] through line by line and you know make
[5:49] all the comments and
[5:52] you know edits and so forth that we
[5:54] think are are appropriate. So, we do
[5:57] meet once a month and we have
[5:59] traditionally met the entire time I've
[6:01] been on this always on Monday
[6:02] afternoons. Recently, we changed the
[6:04] time to Monday at 2 to accommodate
[6:07] another uh uh meeting that Erica has.
[6:11] And um so you know we were going to talk
[6:14] about changing this but we thought well
[6:16] let's wait till whatever month it is
[6:18] soon that everybody's here and then
[6:20] we'll work around what what works best
[6:22] for you for everyone [clears throat]
[6:26] and in this day and age we can
[6:28] participate by teleconference. To me
[6:30] it's always great to be here in this
[6:32] room if at all possible but Kim I know
[6:34] you have you know more commuting issues.
[6:36] So uh to the extent possible we'll we'll
[6:38] meet here continue to meet here. Um so
[6:42] um the chair is supposed to be elected
[6:46] uh in August. I saw it briefly on this
[6:48] agenda and then it disappeared and
[6:50] probably because of this issue of our
[6:52] our committee structure itself isn't
[6:54] quite set. So that would probably be in
[6:57] September I'm assuming. Um so the the
[7:01] chair and I was elected I think two
[7:03] years ago and then reelected. Um, my my
[7:07] position is to work with MNA and with
[7:10] Lisa on the the the agendas. Lisa's
[7:13] great about carrying over things that
[7:16] she knows we need to talk about and then
[7:17] Mirina has her stuff and then I have my
[7:19] stuff and then we we work it out.
[7:21] Usually the agendas aren't too terribly
[7:23] long. Um, and then I'm responsible for
[7:27] leading the meeting. The vice chair
[7:28] leads the meeting when um I'm pointing
[7:32] this way. Lisa Tina is not actually the
[7:34] vice chair, but whoever's sitting here.
[7:36] Um, in my absence, the the vice chair
[7:39] would would lead the meeting.
[7:41] Um, the minutes come to the chair after
[7:45] Lisa writes them up for edits. We do
[7:49] action minutes, which used to be
[7:51] frustrating to me because it didn't have
[7:53] like all the stuff in them and I like
[7:54] detail. So, we've kind of come to a
[7:57] compromise and if there's some kind of
[8:00] meaty issue that needs a little detail,
[8:02] I added quite a bit to our minutes the
[8:05] last time because we were talking about
[8:06] the bond measure. I thought it would be
[8:08] helpful to add to the minutes some of
[8:10] the detail that we had talked about, but
[8:13] we don't do she said this and he said
[8:15] that and they approved that and stuff
[8:16] like that. So we try to keep them uh
[8:18] reasonably streamlined but at least
[8:20] informational enough that that helps um
[8:23] certainly the other commissioners to
[8:24] read it and know what it is. So anyway
[8:28] then the then the minutes go out to all
[8:30] the commissioners and then you can all
[8:32] make you know comments and um and then
[8:36] it says here that I am to the chair is
[8:38] to prepare and deliver a monthly report.
[8:40] Usually that's the minutes but it could
[8:43] be something special if there was a
[8:45] special topic. So anyway, uh way back
[8:47] when early days when I was finance
[8:50] committee chair, we had a problematic
[8:53] committee member and we've constantly
[8:56] interrupted and wouldn't you know play
[8:59] by the organizational structure. So
[9:01] anyway, we I added this got added which
[9:04] is uh finance committee members are
[9:06] appointed by the chair, committee
[9:07] members may resign at their discretion.
[9:10] Committee members may also be removed by
[9:12] the chair in consultation with the chair
[9:14] of the finance committee. the chair of
[9:16] the commission can remove people who
[9:17] aren't, you know, functioning or maybe
[9:19] attending or or whatever reason, but
[9:22] that's only happened once in 12 days
[9:24] that I know about. Okay, great. Well,
[9:26] any questions about the role and
[9:27] responsibilities? Anything that you
[9:29] would you're not clear about either one
[9:32] of you.
[9:34] >> Just to thank you and I appreciate the
[9:35] » Just to thank you and I appreciate the
[9:35] overview. It's very helpful.
[9:37] >> You may hear it again next time if I'm
[9:39] » You may hear it again next time if I'm
[9:39] still here and there's another new
[9:40] person. I just think it's important to
[9:42] know what we're doing, you know, what
[9:43] we're supposed to be doing. So great.
[9:45] Well, thank you for your attention to
[9:46] that. Um, moving on to the update on the
[9:49] bond sale and would our CFO take the
[9:53] reigns on this one? I believe
[10:00] » so.
[10:03] Um, finally the culmination of the
[10:07] search for
[10:10] um, finally the culmination for the
[10:13] search and the financing of a new
[10:17] central operations center um, took one
[10:21] of the largest milestones which was the
[10:24] sale of the the revenue bond that
[10:27] happened on Thursday the 13th. it was
[10:31] with very successful uh results. Um we
[10:34] wanted to give you an update today on uh
[10:39] more details on what happened. Um
[10:43] and first
[10:45] why don't give you the this Oh, maybe
[10:48] Bobby are you sharing your screen? Okay,
[10:50] >> I am. Yeah. Uh could folks see the the
[10:53] » I am. Yeah. Uh could folks see the the
[10:53] title slide?
[10:55] >> Yes. So, Bobby from KN&N Municipal
[10:58] » Yes. So, Bobby from KN&N Municipal
[10:58] Advisors is uh here to um give us an
[11:03] overview, but we wanted to start off by
[11:05] letting you know that uh we there there
[11:09] were uh very good um for our for our
[11:14] purposes, good conditions in the market.
[11:17] There were some um economic indicators
[11:19] that came in and uh did not shake
[11:23] anything up. So, it was uh good for us
[11:26] that week. Uh but prior to um the sale,
[11:32] we were required to uh um request a
[11:37] credit rating since this is the first
[11:40] time that the library issued a bond. Of
[11:43] course, we don't have any credit
[11:44] history. And so um we presented um
[11:50] director Tibiot and I presented to a
[11:54] committee from standard and por's global
[11:57] ratings team and um and had submitted
[12:03] many documents to them. Uh they also uh
[12:08] sent us many questions in advance that
[12:11] we prepared for and KN&N helped us
[12:14] prepare a presentation of our financial
[12:18] condition profile of the uh Sonoma
[12:23] County and specifically the library
[12:26] which uh all was uh wellreceived and as
[12:31] a result standard and pores rated the
[12:33] library
[12:35] an AA plus.
[12:37] >> Is that the highest you can get? Is
[12:38] » Is that the highest you can get? Is
[12:38] there any AAA or double plus or anything
[12:41] >> there? The AAA is the highest. Um, and
[12:44] » there? The AAA is the highest. Um, and
[12:44] then there's probably a couple of others
[12:47] in between the AA plus and the AAA.
[12:51] >> Uh, double A plus is just below AAA. So,
[12:54] » Uh, double A plus is just below AAA. So,
[12:54] it's AAA and then double A+. So, this is
[12:57] a very very strong rating.
[13:01] So I I I wanted to make sure uh the
[13:04] finance committee knew that uh the one
[13:09] of the major results of it of this was
[13:13] because of uh very strong uh fiscal
[13:17] management of the organization. They
[13:20] cited uh the policies, the financial
[13:23] policies of the fund balance, uh
[13:26] proactive payment of the OPE liability,
[13:31] the pension liability,
[13:33] and um conservative budgeting. So, all
[13:38] of those items um uh influenced that
[13:43] double A+ rating. and wanted to thank uh
[13:47] KN&N for uh their assistance in uh
[13:52] preparing all of this. And the the
[13:57] rating is very important because it it
[13:59] is an an indicator to potential
[14:03] investors of how um
[14:07] creditw worthy we are um to pay back you
[14:11] know any investment. Um and so therefore
[14:14] um uh wanted to to highlight that kudos
[14:19] to the the commission, the finance
[14:22] committee that's had led many of these
[14:24] policies that contributed to this um
[14:29] this uh stable outlook for us.
[14:31] >> Um I'm going to add to that a little
[14:33] » Um I'm going to add to that a little
[14:33] bit. Um, and one of the reasons why we
[14:35] received this high rating wasn't just
[14:37] because of our financial stability, but
[14:39] all of those policies that the finance
[14:42] committee um, helped guide us through,
[14:44] including our allocation of revenue
[14:46] sources, our fund balance policy, um,
[14:50] our debt policy we passed. So, all of
[14:53] those things actually helped contribute
[14:55] to our double A+ rating. So having that
[14:59] secure policy base um was really helpful
[15:02] and it will also be helpful in years to
[15:05] come. You know we always have the
[15:06] opportunity to um refinance um in 10
[15:10] years and maintaining a solid credit
[15:13] rating will improve our ability to get
[15:16] um better interest rates in 10 years.
[15:19] So, it's a good thing as long as we can
[15:21] kind of maintain this fiscal stability
[15:23] and uh fiscal um responsibility, it will
[15:26] it just bodess well for us.
[15:31] » So, transitioning to the next slide,
[15:33] which is the summary of competitive sale
[15:35] pricing results, I will uh ask Bobby to
[15:41] um step in and go over these next few
[15:44] slides.
[15:46] >> Great. Uh thank you, Mina. And uh good
[15:48] » Great. Uh thank you, Mina. And uh good
[15:48] afternoon uh members of the finance
[15:50] committee. Uh Bobby Chung from KN&N
[15:52] public finance. Um yeah, as uh uh uh
[15:56] just mentioned uh the double A+ credit
[15:58] rating really was a strength in the uh
[16:02] marketing of this uh transaction. Um
[16:05] your bond sold via a competitive sale.
[16:07] So um the entire universe of uh broker
[16:11] dealer firms were invited uh uh to
[16:14] participate uh in this transaction and
[16:17] last Thursday uh uh we received nine
[16:21] bids from the market um with uh the
[16:25] winning bid being submitted by UBS
[16:28] Financial Services uh at a true interest
[16:31] cost of uh just about 4.04%.
[16:35] And the true interest cost is a is a
[16:37] blended borrowing rate uh for each one
[16:40] of the uh the 30 years of uh uh bond
[16:43] maturities that that were uh uh that
[16:45] were priced. Um and uh as uh as
[16:49] mentioned previously uh really the the
[16:52] the CPI and PPI figures that were
[16:55] released uh in advance of that uh sale
[16:57] date um contributed to a really strong
[17:00] tone in the market. basically uh fears
[17:03] of inflation were removed uh and it was
[17:06] um uh a really good uh strong day. And
[17:09] so as you could see uh you know the UBS
[17:11] bid uh uh came in uh significantly lower
[17:15] uh than many of the other bids uh that
[17:17] were received uh on on on the day of
[17:20] sale.
[17:21] Uh
[17:23] the next slide uh is the final sources
[17:26] and uses. Um uh total sources equals
[17:30] total uses. Here uh the transaction bar
[17:33] amount uh after factoring in um the
[17:38] actual coupons and yields received from
[17:40] UBS uh was finalized at $12.025
[17:44] million. Uh as a function of the sale,
[17:47] uh uh the library will be receiving
[17:49] about $400,000
[17:52] uh in bond premium uh from the investors
[17:54] who purchased uh uh these bonds um
[17:58] totaling uh sources of 12.447.
[18:02] Uh in terms of the uses, 12.18 million
[18:06] will go towards the uh the acquisition.
[18:08] Uh this of course uh uh um uh is in
[18:13] addition to the $600,000 that the
[18:15] library uh is um you know has already
[18:18] committed uh in cash. Uh about $220 went
[18:22] towards paying cost of issuance and that
[18:24] covered our fee uh bond and disclosure
[18:28] council, the credit rating, the trustee,
[18:31] the financial printer uh etc.
[18:35] uh the underwriter discount uh 45,000 uh
[18:39] that uh that's the amount that went to
[18:40] UBS uh for uh for winning the bid uh and
[18:44] underwriting the bonds. And this
[18:46] rounding amount is just because uh bonds
[18:48] are issued in $5,000 increments.
[18:52] Uh the transaction will close next
[18:54] Thursday on August 27th. Um this is uh
[18:58] uh the transaction has a final maturity
[19:00] of October 1, 206 and the final true
[19:03] interest cost was right around 4.04%.
[19:07] Uh this resulted in uh average annual
[19:09] payments of uh about $712,000
[19:14] uh per fiscal year and total payments of
[19:18] about uh 21.69
[19:21] million when factoring in both principal
[19:24] uh and interest.
[19:26] Uh so the next slide shows the the
[19:29] detailed uh breakout of principal and
[19:32] interest. Um we we structured this to
[19:35] generate level payments on a fiscal year
[19:37] basis for the entire term uh except for
[19:40] the current fiscal year which just has
[19:42] an interest payment uh uh due in the
[19:44] spring of uh 2027. Um but yeah, no uh
[19:49] you know this this result came in um you
[19:51] know stronger than than we were
[19:53] anticipating. Uh I think the last time I
[19:55] I spoke before your your fuller
[19:57] commission you know we were estimating
[19:59] you know 750,000 per year uh you know
[20:02] the borrowing rate uh as of that time um
[20:05] we were estimating you know like 440 450
[20:08] range and then the credit rating came in
[20:10] stronger than anticipated uh and the
[20:12] bond market conditions itself were were
[20:15] stronger uh um uh than we were
[20:17] anticipating. So I think this is a
[20:19] really good result.
[20:21] Um the next slide is uh just a couple of
[20:24] next steps through the bond closing. Uh
[20:26] so um you know as we uh as we all know
[20:31] uh the steps leading up to uh uh up to
[20:34] uh the pricing um uh have occurred
[20:37] already. Uh so we have locked in those
[20:40] interest rates. Uh and over the course
[20:43] of this week uh and through early next
[20:46] week, we'll be obtaining signatures
[20:47] necessary for closing. Uh and then next
[20:50] Thursday the 27th um uh the transaction
[20:53] will officially close where UBS will
[20:56] send money uh to our trustee uh and then
[21:00] the trustee will send uh uh a transfer
[21:03] to uh your account uh on on the day of
[21:06] closing. Uh so let me pause there see if
[21:09] there are any questions uh before we
[21:11] move on uh uh to the uh to the last
[21:14] slide.
[21:15] >> Any questions from commissioners?
[21:19] » Any questions from commissioners?
[21:19] I have something I'd like to add.
[21:22] >> Yes.
[21:24] » Yes.
[21:24] >> Um, so I know that when we were
[21:25] » Um, so I know that when we were
[21:26] contemplating this purchase, one of the
[21:28] things that we looked at was a
[21:29] comparison of our lease costs versus uh
[21:33] our debt service. And I can say with
[21:35] this new interest rate, uh, we will
[21:38] surpass our lease costs in year four.
[21:42] So, we will um we will basically be
[21:45] paying a little bit more for the next
[21:47] four years, but we will be flat payments
[21:52] essentially um after um after that. And
[21:54] so, it really is prudent that we made
[21:57] this decision.
[22:00] >> That's really great news. And I happen
[22:02] » That's really great news. And I happen
[22:02] to bring this from one of our early
[22:04] discussions and it we're trying to see
[22:06] which was a better deal. And there was
[22:08] it did show that crossover at year six.
[22:10] What I had noticed and the reason I
[22:12] brought this was, you know, we're
[22:13] talking about 764,762,000.
[22:18] Bobby mentioned a slightly lower number,
[22:20] but I mean, you know, it's 50,000 a year
[22:23] or something like that for 30 years, you
[22:26] know, at least. So, it's saves us a lot
[22:28] of money and that is due to the high
[22:30] rating, right? We take it all back to
[22:32] being a great
[22:35] greatly wellorganized functioning fiscal
[22:38] organization. So anyway, uh I like
[22:41] Bobby. I love the fact that you were
[22:42] kind of surprised.
[22:46] >> Yeah, I am too. [laughter]
[22:49] » Yeah, I am too. [laughter]
[22:49] >> You dealt with any similar kind of
[22:51] » You dealt with any similar kind of
[22:51] public institution like us that
[22:53] surprised you in such a way?
[22:55] >> Yeah. Yeah. You know, of course,
[22:57] » Yeah. Yeah. You know, of course,
[22:57] sometimes it goes the other way, right?
[22:58] Um uh there were uh um this was a very
[23:03] good uh result in the credit rating uh
[23:06] and a very good tone in the bond market.
[23:07] So, uh, you really had those two things,
[23:10] um, working for you. Um, so, yeah, it
[23:14] it's just a testament to, you know, to
[23:16] this committee's, uh, in particular, uh,
[23:18] you know, prudent, um, financial
[23:21] management. So, yeah.
[23:24] >> So, there there's a little bit of a
[23:25] » So, there there's a little bit of a
[23:25] lucky day aspect to this, too, given the
[23:29] political climate and national political
[23:31] climate. Is that what you were kind of
[23:32] pointing out in your report?
[23:34] >> A little bit. Yes. Right. Um the the
[23:36] » A little bit. Yes. Right. Um the the
[23:36] double A plus credit ratings certainly
[23:38] helped. Um but also uh we we did hit a
[23:42] particularly stable
[23:44] tone in the market. You know leading up
[23:47] to to last Thursday there was about a
[23:49] week and a half of stability. Um and uh
[23:52] uh strength in the bond market. Um so
[23:56] that uh uh that all uh came to to your
[24:00] benefit.
[24:02] >> Great. The the fates were with us. Um,
[24:05] » Great. The the fates were with us. Um,
[24:05] Bobby, my question would be, do you have
[24:07] a continuing role?
[24:10] >> We do. We do. Yeah. Um, and that's a
[24:13] » We do. We do. Yeah. Um, and that's a
[24:13] good transition actually. Uh, Mirina,
[24:15] uh, why don't, uh, MNA walk through, uh,
[24:19] this last slide and then and then I
[24:21] could talk a little bit about, um, our
[24:24] continuing role.
[24:28] So um as you know the closing is on
[24:31] August 27th
[24:33] and then at that time the trustee
[24:36] computer share will distribute the bron
[24:38] proceeds to the library as Bobby has
[24:41] mentioned. Um the library has then has
[24:44] to turn that around and wire the funds
[24:47] to um Old Republic title uh so that um
[24:52] we complete our transaction with the
[24:54] seller and that's we should be doing
[24:57] that by early the first week of um
[25:00] September.
[25:02] Um the library will be establishing a
[25:06] new um fund so that we can track these
[25:11] proceeds and payments um separately from
[25:15] all of our other funds. And our first
[25:18] payment is due on April 2027. It will be
[25:24] print um interest only at that time. But
[25:28] then our second payment which is due in
[25:30] October will include principal and
[25:32] interest and it will be the first time
[25:34] we see that 700,000 number.
[25:38] And uh in terms of uh KN&N's role, uh
[25:43] the library will be required to um
[25:46] submit reports annually to the state and
[25:50] um and uh we'll need to we will be
[25:54] receiving assistance from KN&N in
[25:56] compliance with these reporting
[25:58] requirements.
[26:01] Did you want to add anything to that,
[26:02] Bobby?
[26:04] >> Um yeah, ju just on that last point. Um
[26:07] » Um yeah, ju just on that last point. Um
[26:07] uh again since uh since these bonds once
[26:09] they close um you know they're they're
[26:11] publicly issued bonds. So the investors
[26:13] who purchase your bonds initially uh you
[26:16] know should they want to they they have
[26:18] the flexibility to to trade them in the
[26:20] secondary market. So uh it's important
[26:22] that um uh uh the information uh remains
[26:27] current for for bond holders. And so
[26:29] there's a there's a continuing
[26:31] disclosure requirement uh uh where where
[26:34] the library will uh on an annual basis
[26:37] uh basically present its uh uh its its
[26:41] annual audit uh plus um I think two of
[26:44] the tables in the preliminary um and
[26:47] final official statement uh to the
[26:49] market and and that will help uh you
[26:52] know keep investors um uh uh up to date
[26:55] on on your credit. Um
[26:58] uh yeah, the state of California through
[27:00] the treasur's office has a annual debt
[27:04] uh transparency report uh that basically
[27:07] um where where you report the spend down
[27:10] of the your bond proceeds and also the
[27:13] payown of your uh outstanding bonds. Um
[27:16] that's an annual requirement. Um and uh
[27:19] yeah, we we do not disappear uh at uh
[27:22] you know at at at time of the bond
[27:24] closing. Um, you know, we're here to to
[27:27] assist with the compliance of of these
[27:29] measures, uh, moving forward.
[27:33] >> Thank you very much. Um, commissioners,
[27:35] » Thank you very much. Um, commissioners,
[27:35] do you have any questions at this point?
[27:37] Um, I would like to ask kind of a simple
[27:40] question, but to explain to the public,
[27:43] I I was at a forens library meeting this
[27:46] morning. What is like a simple language
[27:48] that we can use to explain what we have
[27:50] just done as a library?
[27:55] you know it like
[27:56] >> well uh I I'll start off and maybe Bobby
[28:00] » well uh I I'll start off and maybe Bobby
[28:00] can elaborate. Essentially
[28:03] uh we we are promising that um
[28:10] that the library because of its strong
[28:12] property tax general fund revenues. we
[28:16] are able to afford to pay back uh a loan
[28:20] that we took from um you know a public
[28:23] sale of bonds.
[28:26] Is it something about when we have gone
[28:29] out for you know that's something about
[28:32] going out and issuing public bonds it
[28:34] gets complicated when you try to explain
[28:36] it because obviously KN&N and all the
[28:38] people that involved in this I mean we
[28:40] didn't do it but how do you how do you
[28:42] kind of explain it to the public but you
[28:44] know for the first time we are taking on
[28:46] you know debt to buy a a headquarters an
[28:48] operations building by by what me by
[28:51] what method
[28:53] >> um through a competitive bond sale. So,
[28:56] » um through a competitive bond sale. So,
[28:56] as opposed to, you know, I think when
[28:58] most people think of bonds, they think
[28:59] about those um those ballot measures,
[29:02] you know, those bonds that are actually
[29:04] pledges of additional taxes that people
[29:07] will pay. So, this is not an additional
[29:10] tax. Um they are not paying, you know,
[29:13] taxpayers will not be paying any more
[29:15] money to the library as a result of
[29:17] this. This is an investor who has looked
[29:20] at our finances, who has learned, who
[29:23] has decided that they [clears throat]
[29:24] can make money on this investment and
[29:28] they are lending us money in order to
[29:33] make money, if that makes sense. and
[29:35] they are looking at our balance sheets
[29:37] and our fiscal policies and our
[29:39] financial stability and they're
[29:40] basically they're taking a risk you know
[29:43] um that uh that we will continue to be
[29:46] fiscally stable and um and make
[29:50] financial prudent financial decisions
[29:52] but that risk is going to you know earn
[29:55] them money
[29:58] if that makes sense. Do we call it
[30:00] public bond sales? Is that right?
[30:04] >> Correct.
[30:05] » Correct.
[30:05] >> Yes, that that's that's right. Yes.
[30:07] » Yes, that that's that's right. Yes.
[30:07] >> And so I think it is important though
[30:09] » And so I think it is important though
[30:10] this point that we made earlier that
[30:11] this is not that it saves us money that
[30:15] in in within four years we'll be paying
[30:18] less by paying the interest on this than
[30:20] we would have been paying for a lease. I
[30:21] think that's part of anyway I' I'd like
[30:23] to boil it down at some point in time to
[30:26] uh you know the elevator paragraph or uh
[30:30] yes Eve
[30:34] said to people
[30:35] >> uh Eve can you please push your
[30:38] » uh Eve can you please push your
[30:38] >> this is what I have said that's short
[30:41] » this is what I have said that's short
[30:41] but it could be wrong so I want to put
[30:44] it out there and find out if I got it
[30:45] right or wrong. So, I have said um cuz
[30:49] somebody asked me I've said we have
[30:52] floated a a public bond instead of going
[30:55] to a bank for a loan and they said is
[31:00] that because with a public bond
[31:04] you are paying a lower interest rate and
[31:06] I said yes and they said are you paying
[31:09] a lower interest rate because you're a
[31:11] public institution so the investors
[31:14] don't have so somebody doesn't have to
[31:17] pay taxes on their dividends. And I
[31:19] said, I don't know, but I think so. Is
[31:22] that correct? Is that why we have a
[31:24] lower interest rate? That that's a
[31:28] that's an excellent question. Um, first
[31:31] of all, yes. The investors that have
[31:35] loaned you money do not have to pay uh
[31:38] income tax on the interest that they
[31:41] receive, federal income tax. A and if
[31:44] they live in California, uh state income
[31:47] tax as well. Um so then therefore
[31:49] they're they are willing to to loan you
[31:51] money at a uh preferential uh or lower
[31:56] interest rate versus uh a private
[31:58] company um uh you know uh selling bonds.
[32:03] Um so that that's number one. Number
[32:05] [clears throat] two, you could always go
[32:08] to a bank uh and a bank would lend you
[32:11] money at a tax exempt rate. Uh but
[32:15] accessing the public bond market as we
[32:17] did through a competitive sale um
[32:20] results
[32:21] generally in a lower interest rate than
[32:24] going directly to a bank. So, not only
[32:27] is your rate tax exempt,
[32:30] but also it's a public bond sale and
[32:33] lower than if you went to just a a a
[32:36] like a commercial bank like a Beimo or
[32:39] or or JP Morgan uh uh for a uh for a
[32:43] direct loan.
[32:47] » So, it's both.
[32:49] >> Thanks.
[32:50] » Thanks.
[32:50] >> Yeah.
[32:52] » Yeah.
[32:52] >> Great.
[32:53] » Great.
[32:53] I think we're all feeling very
[32:55] celebratory.
[32:56] I certainly am. So, um, any other
[33:00] questions? Anything else you'd like to
[33:01] say to us, Bobby, before we wrap up the
[33:06] >> No, congratulations. We were uh uh very
[33:09] » No, congratulations. We were uh uh very
[33:09] pleased with the result and we look
[33:10] forward to the to the closing uh next
[33:12] Thursday. Well, from everything I've
[33:15] heard, you've been great to work with
[33:17] and um really appreciate every all your
[33:19] efforts and clarifying everything to us
[33:22] and walking us through a brand new
[33:24] thing. So, thanks very much.
[33:26] >> Appreciate it. Thank you.
[33:29] » Appreciate it. Thank you.
[33:29] >> Bobby.
[33:30] » Bobby.
[33:30] >> All right. See you later.
[33:32] » All right. See you later.
[33:32] >> All right. Thank you.
[33:35] » All right. Thank you.
[33:35] >> Bye.
[33:38] » He's very calming, doesn't he? It feels
[33:41] like it's all under control with Bobby.
[33:42] Jo's got it. It's really good. Mirina,
[33:45] did you want to add anything or or Erica
[33:47] to our this discussion
[33:50] before we move forward?
[33:52] >> This this is a major milestone for for
[33:55] » This this is a major milestone for for
[33:55] the library. I I believe that um you
[33:59] know the the sales tax measures have
[34:02] allowed us to and have propelled us to
[34:05] this point and the library continues to
[34:09] mature in meaning that um these policies
[34:14] that are in place um
[34:18] uh are an important factor in
[34:23] establishing controls and expectations.
[34:26] ations and transparency on how we manage
[34:29] our affairs and um so the work of this
[34:35] committee has been really instrumental
[34:37] in that. Um having a full staff in um uh
[34:44] in our in our accounting working with
[34:46] the county uh partners uh have made a
[34:50] very big difference. We've had clean
[34:52] audits um and uh so I think all of that
[34:58] is um is moving us in the right
[35:00] direction. But my point is that the
[35:03] library continues to with the more
[35:07] uh revenues
[35:10] um and the greater expenditures that we
[35:13] have uh this the organization is uh
[35:17] becoming more complex and um
[35:22] and more mature and uh has been able to
[35:26] utilize the tools that are set for us in
[35:29] the joint powers. agreement
[35:32] and uh and so this is this had never
[35:35] been exercised before, but we are
[35:38] utilizing it and and it was there for a
[35:40] reason um to continue to provide very
[35:44] good services for for um our residents.
[35:49] And uh I'd like to say that working with
[35:52] uh director Tibbo is uh pretty amazing.
[35:55] she d, you know, she's jumps right in.
[35:58] Um, and uh and and and we work really
[36:02] well together and really appreciate um
[36:06] her her her uh inquisitiveness and and
[36:11] uh also vision for um for this
[36:15] organization. So, thank you.
[36:17] >> Well, I I couldn't have done it without
[36:18] » Well, I I couldn't have done it without
[36:18] Mirat.
[36:20] >> Absolutely not. and uh you know and also
[36:22] » Absolutely not. and uh you know and also
[36:22] having these adviserss you know really
[36:24] walk us through the process. It was
[36:26] enormously helpful. Um we could not have
[36:28] done it um by ourselves. It was just an
[36:31] enormous task. And of course the um
[36:33] accounting staff was also incredibly
[36:36] helpful and having them uh to support
[36:38] her. And you know we probably and poor
[36:41] Lisa you know um our last couple
[36:43] commission meeting packets have been you
[36:45] know down to the wire and I don't really
[36:47] like to operate that way. Um, but it has
[36:49] really been because this purchase and
[36:52] the bond sale has eaten up a lot of
[36:54] time. Um, but you know, I'm very I'm
[36:57] hopeful that after this we can go back
[36:59] to our our regularly scheduled
[37:02] commission packets.
[37:04] So, thank you, Lisa.
[37:06] >> Thanks.
[37:07] » Thanks.
[37:07] >> You're welcome.
[37:10] » You're welcome.
[37:10] >> Well, I'm going to allow myself a couple
[37:11] » Well, I'm going to allow myself a couple
[37:11] of minutes here because
[37:14] um I I I realize I'm really the last of
[37:17] the old guard. there's no commissioner
[37:19] has been on as long and and the
[37:22] management hasn't been on as long and so
[37:24] forth and just to give everybody just a
[37:26] dose of perspective when again you know
[37:28] I love your word mirror about this
[37:31] organization maturing is a perfect word
[37:34] and evolving and adding and you know
[37:36] building um because 12 years ago when
[37:39] the new JPA started we were operating on
[37:42] a shoestring we had only the property
[37:45] tax I believe it was 15 million it was
[37:47] something like the budget was about that
[37:48] and you know 12 years later we're at 50.
[37:51] Um it was open the library is open 40 uh
[37:54] 40 hours a week 5 days a week closed
[37:56] Sunday and Monday there was just the it
[38:00] was keeping the lights on the friends
[38:02] were buying most of the books. I mean it
[38:04] was a very very desperate situation and
[38:07] right before the new JPA kicked in at
[38:10] that time again I like to point out that
[38:11] Jamie Anderson and David Dodd were
[38:14] co-inter directors. I mean everything
[38:17] was just so patched together and um so
[38:22] those brand new CFOs brand new CEO um
[38:25] the brand new commission I mean
[38:27] everything was just you know new and
[38:29] green and and shaky and you know just
[38:31] trying to to build an organization from
[38:34] whatever there was a fund balance policy
[38:36] but it wasn't very complete and we
[38:38] started working on that right away um
[38:41] the OPED I'm very proud of because I was
[38:45] part of that And we had we went out and
[38:47] got I got Darren Jenkins who was our
[38:49] city manager at the time to be on a
[38:51] subcommittee and there were two other
[38:53] pension experts who joined us and
[38:55] created this you know policy just out of
[38:59] whole cloth once we once we got the t
[39:01] first tax measure passed when we got
[39:03] measure Y passed and so then there was
[39:05] money. Um the the Kalpers thing is just
[39:08] brand new right off just we just voted
[39:11] on that as a commission and that was the
[39:12] other thing and I know Andy was really
[39:14] very essential in that something that
[39:17] there's two big unfunded liabilities and
[39:20] we taken care of both of them. I mean
[39:22] it's really astonishing. Andy is
[39:24] somebody who's pointed out not long ago
[39:26] that we don't often reflect on our
[39:28] successes enough. And part of it I think
[39:30] is uh losing the perspective and if
[39:33] anything I can bring perspective because
[39:35] you've lived through this whole thing
[39:37] and uh the the difference in having
[39:40] committed
[39:41] permanent feeling management is just
[39:44] makes all the difference in the world.
[39:46] You two are a tremendous team. you've
[39:48] just we feel solid and of course Dara
[39:51] adds her expertise you know as a as a
[39:53] assistant director and um it's just it
[39:56] feels so good to be you know so secure
[40:00] in in what we're doing and not fly by
[40:03] night like it did for a long long time.
[40:05] So I applaud everybody who uh has added
[40:08] to the maturity and the development and
[40:10] so forth and it's you know it takes a
[40:12] village and all that takes everybody and
[40:14] their own talents and skills. So um
[40:16] anyway much much much to be proud of for
[40:19] as a system and as all of us who are
[40:22] currently participating as well. So
[40:24] anyway thank you. I I had to indulge in
[40:26] a little
[40:29] reflection. So on that um so we did the
[40:32] update on the bond sale. Let's move on
[40:34] to 4.3 the 26year end on audited
[40:39] financials and back to our CFO for that.
[40:57] I want to bring up the the detail. I'd
[41:00] rather show this
[41:06] the summary.
[41:09] I don't know if you can make it bigger.
[41:13] Probably
[41:16] make it a little bigger. If the yellow
[41:18] comes off, that's fine.
[41:21] Let's see.
[41:31] Okay,
[41:33] little one.
[41:36] Um, okay. So, good afternoon. This is
[41:40] our annual unawudited year-end uh report
[41:45] that shows um financials through June
[41:48] 30th, 2026. We're in August. The month
[41:52] of July is a dual period, what we call a
[41:55] dual period. We're working in the new
[41:57] fiscal year as of July 1, but uh we work
[42:02] with the county's timeline and their
[42:05] financial system. So we are um we work
[42:10] with their timeline in terms of closing
[42:12] the year end. So there are transactions
[42:17] that are happening uh for last fiscal
[42:20] year although it was closed on June
[42:22] 30th. There are transactions that have
[42:25] late invoices that that are that come in
[42:28] after you know July third I mean June
[42:31] 30th. um any um journals that we have to
[42:37] make, you know, moving funds from, you
[42:39] know, uh our friends donations into, you
[42:43] know, property tax or sales tax as
[42:45] reimbursements, closing up and wrapping
[42:48] up our grants. All of those LA uh year
[42:52] end um activities are taking place in
[42:55] July and they we're given about three
[42:59] weeks or so uh to close up and then the
[43:03] system is closed for June 30th and um
[43:07] and then we get we we get our financials
[43:10] that you're seeing in front of you. So,
[43:13] and staff is working very quickly and
[43:17] busily um in the month of July because
[43:19] we're working in two fiscal years.
[43:22] Um
[43:24] so, having said that, uh I wanted to um
[43:28] say that we're in a uh steady uh
[43:32] financial position. Uh so as we're going
[43:35] into strongly into this new fiscal year
[43:38] 2627
[43:40] and um the f the the the
[43:44] first look at this are the budget versus
[43:48] actuals. The budget that you see in
[43:51] green in the green column is the
[43:53] adjusted budget. This is our sum summary
[43:56] page
[43:59] and uh and then you have all the
[44:03] recordings for every month of the fiscal
[44:07] year
[44:09] and uh we have as everyone know knows uh
[44:13] we do have financials for every month um
[44:19] and now we're looking at June and the
[44:21] reason why we have estimated in June
[44:24] is that we may still encounter some
[44:28] budget adjustments
[44:30] uh in particular uh around um revenues
[44:35] in terms of our sales tax and in our
[44:40] expenditures around capital.
[44:43] So um
[44:47] the reason why revenues are estimated
[44:50] under sales tax is that sale we receive
[44:54] our sales tax receipts two months after.
[44:58] So as you can see here the July month is
[45:01] is uh July and August are blank because
[45:05] we don't receive um the July
[45:09] receipts until September. So we record
[45:12] them in September. So therefore if we
[45:15] follow that logic uh the June the May
[45:19] receipts are received in July and the
[45:22] June receipts are received in August
[45:24] that we're still waiting for. Um but we
[45:28] do an estimate. We average the uh April
[45:32] and May receipts and and we plug in uh a
[45:36] figure. We do up them um update them to
[45:41] the true receipts through budget
[45:44] adjustments in August and um eventually
[45:47] we do have an opportunity to ref do
[45:50] those updates also in the system.
[45:54] Um
[45:56] so the actual revenues total were 49.07
[46:01] million
[46:03] uh which is 1.09 09 million greater than
[46:07] the approved budget.
[46:09] Um,
[46:11] and under a, and I'll get into more
[46:14] detail, but this is just the high level.
[46:16] Under actual operating re operating
[46:19] expenditures,
[46:21] operating expenditures are all of their
[46:23] expenditures, salaries, and services and
[46:26] supplies.
[46:29] Um, and it excludes capital.
[46:32] >> Were you in the yellow? We're doing the
[46:34] » Were you in the yellow? We're doing the
[46:34] yellow or you still doing the green
[46:37] >> the green the yellow is last year the
[46:41] » the green the yellow is last year the
[46:41] prior year.
[46:42] >> Oh
[46:43] » Oh
[46:43] she is
[46:46] okay.
[46:52] » Thank you.
[46:53] Okay. So
[46:56] in terms of uh Yes. So actuals are um
[47:02] what I'm looking at are
[47:06] the unodudited actual actuals yearto
[47:09] date plus incumbrances
[47:12] and um can you scoot that over a little
[47:15] bit?
[47:20] » Okay. So we don't encumber revenues. So
[47:24] you see blanks there. And so again our
[47:28] total revenues is 49.07
[47:31] million which is 1 million greater than
[47:36] the budget which and the budget is in
[47:38] the green.
[47:53] Um then I have total expenditures which
[47:56] does include our capital that is the
[48:00] total expenditures are 50.71 million
[48:04] which are approximately also 1.58
[48:07] million less than the approved budget.
[48:11] So we're spending less than we budgeted.
[48:14] What we call a savings.
[48:17] Oh, we have more revenues than we
[48:19] budgeted and also we are spending less
[48:22] than we budgeted. Yes.
[48:24] Um then you could also now this is this
[48:28] what I just explained was from the left
[48:31] to the right. My next uh item is from
[48:36] the top to the bottom. You can see that
[48:39] our revenues were 49 million
[48:44] with the total
[48:47] cap with capital expenditures of 50.7
[48:50] million
[48:52] our revenues
[48:54] our expenditures are greater than our
[48:57] revenues but that has was planned for
[49:00] and the reason is that what is bringing
[49:04] us up above our revenue are there a
[49:07] capital expenditures and as we know we
[49:10] use our fund balance for for that and
[49:14] right here what we're showing is our
[49:16] operating revenue that comes in
[49:18] annually.
[49:20] Okay,
[49:20] >> that was so that was planned for.
[49:23] » that was so that was planned for.
[49:24] >> And when you say fund balance
[49:28] as opposed to unassigned fund balance,
[49:32] are you saying that those capital
[49:34] expenditures were already
[49:36] put aside?
[49:39] Nothing to do with the unassigned.
[49:41] >> Correct.
[49:42] » Correct.
[49:42] >> Okay,
[49:43] » Okay,
[49:43] >> I'm going to interject just a quick
[49:45] » I'm going to interject just a quick
[49:45] point. One of the reports I wanted to
[49:47] start off our training with was the fund
[49:50] balance reports, but they're not
[49:52] finalized yet, but it really helps you.
[49:55] You can see the property tax and the
[49:57] sales tax and you can see the money put
[49:59] aside for all the stuff and it just it
[50:01] really will help and we'll have that
[50:03] next in September
[50:05] so you can look at that. But it'll help
[50:07] you. Yeah, responsible being on a
[50:10] committee that I better really
[50:12] understand things when I haven't really,
[50:15] you know, I sort of semi okay, you know,
[50:18] maybe find
[50:21] this stuff now.
[50:22] >> I'm available at any time uh you have
[50:25] » I'm available at any time uh you have
[50:25] any questions um if you'd like to sit
[50:27] down and go over these reports.
[50:30] Okay. So in terms of um
[50:36] revenue details um I already mentioned
[50:40] the high level just to drill down into
[50:43] property tax. Property tax receipts were
[50:46] a total of 30.28
[50:48] million
[50:50] right there.
[50:52] um which is approximately 267 less than
[50:57] the approved adjusted budget. Uh what
[51:00] we're seeing and experiencing is that
[51:03] properties are still staying on the
[51:05] market longer and um and also affecting
[51:10] the number of sales. People are still
[51:12] it's just the market has slowed down a
[51:14] little bit.
[51:16] Um
[51:18] the under sales tax the estimated
[51:20] receipts are 15.61
[51:23] million. Uh it's $34,000
[51:28] greater than the approved but again
[51:30] that's estimated. We will true these up
[51:33] or update to actuals. um
[51:37] the later this month when we receive uh
[51:40] those those August figures.
[51:44] Other revenue
[51:46] receipts is a combination of revenues
[51:48] such as interest earned on our cash
[51:51] balances,
[51:52] other um other jurisdictional or
[51:55] intergovernmental sources which includes
[51:58] grants and donations.
[52:00] Um and that is a total of 1 3.17
[52:07] million which is 1.32 million greater
[52:10] than the approved budget
[52:13] and primarily the reason is um the two
[52:18] reasons um is the
[52:22] we did receive um we we've done a lot of
[52:26] work are we completed the work with at
[52:28] HNG
[52:30] Um, we should be are we um Sarah would
[52:35] know. Yeah.
[52:36] >> Yeah. I haven't had an update on that uh
[52:38] » Yeah. I haven't had an update on that uh
[52:38] in at least two weeks, but the last I
[52:41] heard the HVAC was still being finished.
[52:44] >> Okay.
[52:45] » Okay.
[52:45] So um the li since the library owns the
[52:50] HNG building behind central library the
[52:54] library applied directly to the state
[52:57] for the building forward grant. It's a
[52:59] capital grant. Um and in other cases
[53:03] where we re where we worked with the
[53:06] cities they applied the city applied
[53:09] directly for that grant because they're
[53:11] the owners. They own those buildings.
[53:14] But in this case, the library owns the
[53:15] H&G building and um and and it's a
[53:21] reimbursement. So as the library spends
[53:24] the funds, we can then draw down the the
[53:27] funding from on a reimbursement basis
[53:29] from this from the state. And so this
[53:32] year we received $900,000
[53:35] um from those grant funds.
[53:38] Um,
[53:40] and also,
[53:44] uh, interest earned on our pulled cash
[53:46] was $200,000 greater than anticipated as
[53:50] well. The markets are doing well. Um,
[53:53] and therefore, we're we're experiencing
[53:55] that. Also, we receive PEG funds from
[53:59] the city of Santa Rosa. Those are
[54:04] funds that um are received because of uh
[54:08] the city's relationship with um
[54:13] contracts and agreements and they're
[54:16] called right use of rights with Comcast
[54:20] for example. Um and so you can use these
[54:24] funds for
[54:27] education
[54:28] and um yeah educational reasons and the
[54:33] city has provided some of those funds to
[54:37] the library and the library uses them at
[54:41] um the libraries that are located within
[54:44] Santa City of Santa Rosa. They include
[54:47] um studios, recording studios, cameras.
[54:52] There's uh definitely one at Central and
[54:56] I just saw the one at at Rinkan Valley.
[54:59] Uh amazing resource. [snorts]
[55:02] Um so some of those funds came in in
[55:05] August, so we'll need to update our
[55:08] revenues, but um uh that is recorded in
[55:12] other revenue. Um
[55:17] and so what's all what else is in other
[55:19] revenue is a combination of donations
[55:22] um you know our photo copies
[55:25] um we do have a heavy use of photo
[55:28] copies um here at the library and people
[55:32] are using them because they get $5 a day
[55:36] plus they they spend more and I if you
[55:39] we've um the commission approved a rate
[55:42] increase And even at that rate, it's
[55:45] still
[55:47] a better rate than in, you know, FedEx
[55:50] or some Staples.
[55:52] Um, and we also do community room
[55:55] rentals and, uh, patrons pay the library
[56:00] for any damaged or lost materials.
[56:05] Any questions on revenue?
[56:10] about the whole report just the revenue
[56:13] piece.
[56:15] >> I had one about the that same uh row
[56:19] » I had one about the that same uh row
[56:19] with the interest income for September
[56:21] and February. It shows it as negative.
[56:24] How does that happen?
[56:25] >> Oh, it's a zero. It's it's zero. It's
[56:28] » Oh, it's a zero. It's it's zero. It's
[56:28] blank. Um interest is posted quarterly.
[56:31] So,
[56:33] the quarter ends at the end of
[56:36] September, so it's posted in October.
[56:39] >> Thank you. so on and so forth. Yeah.
[56:43] Okay. I'll move into the expenditures
[56:46] which is the latter half of this page.
[56:50] And again we have the budgeted uh
[56:54] expenditures here in the green. We have
[56:57] our unodudited yeartoate those. So this
[57:02] column here are actuals. what actually
[57:05] was spent and money out the door. We
[57:09] also have this column of encumbrances
[57:12] which is new this year. It is a way for
[57:16] further budget control and planning for
[57:20] the library.
[57:23] Um, Katherine was uh instrumental in
[57:27] working with the county to uh
[57:32] give us the the the authority to use the
[57:35] encumbrance module in our financial
[57:37] system.
[57:38] Um so I will tell you for example here
[57:43] um I would say
[57:46] so we know that in
[57:51] let's see we start with other contract
[57:54] services we've spent 79
[57:58] 791,000 approximately actuals plus we
[58:02] have encumbered or set aside
[58:06] $38,000
[58:09] for a to if when you add those two up
[58:11] you have 830,000.
[58:13] What does this encumbrance rep
[58:16] represent?
[58:17] are we may have contract. We when we
[58:20] receive a contract and let's say the
[58:22] contract is $100,000, but we know we're
[58:25] only going to we plan on spending that
[58:28] amount, but
[58:30] out of all the contracts that we have,
[58:33] we did not spend the full um the full
[58:38] amount on those contracts, but we know
[58:41] that we're on the hook for them. And the
[58:44] encumbrance allows us to roll that those
[58:48] funds over to the next fiscal year
[58:50] because we know we're going to pay from
[58:51] in those contracts.
[58:53] >> What's an example of that? When there's
[58:55] » What's an example of that? When there's
[58:55] a contract, you don't use it all,
[58:59] but then you have to use it.
[59:02] >> So I can give an example. So for
[59:04] » So I can give an example. So for
[59:04] example, we have this FFN contract with
[59:07] uh Jason Architecture for the new
[59:09] Rosland library. So we opened that
[59:12] contract in pre in the previous fiscal
[59:15] year but um you know one payment was
[59:18] made in 2526 but most of it is going to
[59:21] be made in 2627. So we encumber the
[59:25] total amount which is about $44,000
[59:28] in the previous fiscal year but we only
[59:30] spent say 12,000 that means we carry
[59:33] over the balance into the next fiscal
[59:35] year.
[59:40] Um okay. So and then we have other the
[59:45] other um large item here and I think I
[59:49] have that uh explained. Um so for
[59:53] example
[59:55] uh oh
[59:59] yeah
[1:00:01] those are those are also like a
[1:00:04] professional development um funds. the
[1:00:08] in the labor memorandum of understanding
[1:00:13] employees receive a certain amount of
[1:00:16] funds for their professional
[1:00:17] development. Um and if they don't use
[1:00:20] them in that fis that fiscal year they
[1:00:23] roll over. So they do accumulate
[1:00:26] um and we budget for them and um so if
[1:00:33] they're not used in this fiscal year uh
[1:00:36] we h we end up with a savings. So that's
[1:00:39] what's happening there. Um the
[1:00:44] so yeah I'm going down here but I wanted
[1:00:47] to also point out um under salaries and
[1:00:52] benefits we spent a total of 32.331
[1:00:57] million and that was um we did have a
[1:01:01] savings of $240,000
[1:01:04] there over here. Um
[1:01:11] this in so the commission the all the
[1:01:16] negotiations
[1:01:18] did were were completed late in the
[1:01:22] fiscal year and so the
[1:01:26] commission adopted the newou in August
[1:01:30] but it was retroactive to January. So
[1:01:34] all of those costs were paid out in this
[1:01:37] fiscal year. So they were recorded in
[1:01:39] this fiscal year. Um and um but as you
[1:01:44] can see, I think a $240,000 is a modest
[1:01:48] savings. Um but it it it um we did in
[1:01:52] the midyear re request an increase in
[1:01:56] those costs um to reflect um those C
[1:02:01] cola uh increases.
[1:02:05] Okay.
[1:02:08] Any questions so far?
[1:02:12] I'd like to just take you back for a
[1:02:14] quick thing. You're you're talking about
[1:02:15] the county. Um again, the old under the
[1:02:18] old arrangement the county we were
[1:02:20] connect the library is connected to the
[1:02:22] county. So when when Merida talks about
[1:02:25] what the work the county does for us
[1:02:26] now, they are like hired to do. Do we
[1:02:30] call it fiscal or fiscal agent?
[1:02:33] >> No, they're
[1:02:35] » No, they're
[1:02:35] they they're just they just provide
[1:02:38] accounting services.
[1:02:39] >> Accounting service. So we're paying them
[1:02:41] » Accounting service. So we're paying them
[1:02:41] as though we would pay, you know,
[1:02:43] >> a consultant,
[1:02:43] » a consultant,
[1:02:44] >> somebody else,
[1:02:45] » somebody else,
[1:02:45] >> but but they're, you know, not working.
[1:02:48] » but but they're, you know, not working.
[1:02:48] We're not, you know, part of that. you
[1:02:50] know, still we're separated from the
[1:02:51] county and I don't know.
[1:02:53] >> Yeah. So the county
[1:02:56] » Yeah. So the county
[1:02:56] uh in the auditor controllers treasurer
[1:03:00] tax collector's office headed by uh Eric
[1:03:04] Roger, they have a team that provides
[1:03:09] accounting services to special districts
[1:03:14] because at some point in their his in
[1:03:17] the history of the county there there
[1:03:19] are spe there are districts that are
[1:03:22] much smaller than we are uh much more
[1:03:25] focus narrow in their focus and uh you
[1:03:29] know it with um the expertise within the
[1:03:34] the audit auditor controllers's office
[1:03:39] you have expertise but you have
[1:03:40] economies of scale. So, this one team
[1:03:43] that we work with, they serve several
[1:03:47] special districts and um and so we they
[1:03:53] they have an agreement with the library
[1:03:56] and and the auditor controller office.
[1:03:59] >> And uh we if we were to hire that that
[1:04:04] » And uh we if we were to hire that that
[1:04:04] team, it would be probably triple or
[1:04:07] quadruple the cost for us. Um and they
[1:04:11] are they have a lot of institutional
[1:04:14] knowledge of um
[1:04:18] the county policies and procedures. They
[1:04:21] help us prepare for our audit
[1:04:24] um and throughout the year with our
[1:04:26] financials. So it is a uh quite a bit of
[1:04:30] a a great investment um that is very
[1:04:34] much a factor in
[1:04:38] um the results of our audits and the
[1:04:41] results of this AAA plus um
[1:04:46] uh rating that we received.
[1:04:50] So we are we are separate but we we it's
[1:04:53] a it's a it's a it's a contractual uh
[1:04:56] arrangement
[1:04:58] >> for which we pay them. Yeah.
[1:05:00] » for which we pay them. Yeah.
[1:05:00] >> Yes we do.
[1:05:02] » Yes we do.
[1:05:02] >> Um and separately we pay the county for
[1:05:05] » Um and separately we pay the county for
[1:05:06] using their system. So for every invoice
[1:05:09] they charge us for every invoice
[1:05:10] transaction that we enter we get
[1:05:13] charged.
[1:05:15] Um okay so where am I?
[1:05:19] Okay.
[1:05:21] >> Oh yeah, I asked for questions.
[1:05:25] » Oh yeah, I asked for questions.
[1:05:25] Capital. Okay.
[1:05:29] >> Um,
[1:05:30] » Um,
[1:05:30] and capital
[1:05:33] the total inc uh expenditures including
[1:05:37] incumbrances is 5.19
[1:05:42] million. So we've spent 3.15 million. We
[1:05:48] have encumbered two two million and we
[1:05:53] uh for a total of
[1:05:55] 5.19
[1:05:57] million. Uh we do exceed the that the
[1:06:03] budget by 279,000
[1:06:06] and this reflects this and it's driven
[1:06:08] by these encumbrances.
[1:06:12] uh we encumbered we did make a payment.
[1:06:17] So here's another uh building forward
[1:06:19] grant with the city of Ronert Park. City
[1:06:23] of Roner Park applied directly to the
[1:06:25] state for the grant. Um and in and we
[1:06:30] have an agreement the library has an
[1:06:32] agreement with them that whatever
[1:06:36] the there there's a match that's owed
[1:06:38] and the library and the city split it
[1:06:42] 5050 you know 50% the library
[1:06:45] contributes to the match city
[1:06:47] contributes the other 50 and we were
[1:06:51] invoiced 21 our total was 419
[1:06:56] 19,000
[1:06:58] and they invoiced us for 29,000.
[1:07:02] And so we still owe another 210,000.
[1:07:05] When they uh finish the work, they will
[1:07:08] invoice us, but that is encumbered
[1:07:11] because we know we owe it. Um and then
[1:07:15] also
[1:07:17] the architecture work for the for the
[1:07:24] new Rosland library as director to bolt
[1:07:27] mentioned um that work has not been
[1:07:30] completed. So we also have about 44,000
[1:07:35] that is still pending of work. And so
[1:07:38] those are that's what's contributing um
[1:07:41] the
[1:07:43] budget versus actuals when it comes to
[1:07:46] our capital.
[1:07:49] The encumbrances though are reflecting a
[1:07:52] lot of the work at Ricon Valley. Um the
[1:07:56] work started last fiscal year. We were
[1:07:59] original plan was to finish within June
[1:08:01] 30th but as you know uh with the grand
[1:08:05] opening today the work completed in this
[1:08:07] new fiscal year.
[1:08:10] Okay.
[1:08:12] Um all right so that is the summary you
[1:08:17] do have through pages um I don't have
[1:08:21] what these pages are uh
[1:08:26] in the packet they're attachments five
[1:08:30] through um 19
[1:08:34] are greater detail
[1:08:37] uh by account. So you can see how much
[1:08:41] we spent on office supplies, how much
[1:08:44] we've spent on janitorial,
[1:08:47] so on and so forth. You have two sets,
[1:08:50] one for property tax and one for sales
[1:08:52] tax because they are in two separate
[1:08:56] funds. And that's what I mean by funds.
[1:08:58] And when I said that for the um bond
[1:09:04] proceeds, we're going we're creating
[1:09:06] even a another fund where we'll track
[1:09:08] those. So it government
[1:09:12] accounting is fund accounting and we
[1:09:15] have to a lot of cases we need to
[1:09:17] separate the different um sources of
[1:09:21] revenues in a separate fund.
[1:09:24] That's why you see the two set sets of
[1:09:29] detailed spreadsheets.
[1:09:32] Um
[1:09:34] so we in this case we uh also report on
[1:09:39] a monthly basis the cash balance as you
[1:09:43] can see the cash balance as of June 30th
[1:09:46] uh under property tax is 21.8 8 million
[1:09:50] and sales tax is 12.3 million. And um so
[1:09:55] as you can see here,
[1:09:58] every organization has a cycle, a
[1:10:01] revenue cycle. And for property tax,
[1:10:06] the it it peaks at in December 23
[1:10:10] million and then in April 25 million and
[1:10:16] that co that coincides with the property
[1:10:20] tax bills.
[1:10:22] And then for sales tax is pretty evenly
[1:10:25] distributed because we do receive a
[1:10:27] monthly receipt except for July and
[1:10:31] August.
[1:10:33] Uh we do have what we call restricted
[1:10:36] funds which are donations and bequests.
[1:10:40] When when a
[1:10:43] when someone leaves the library a
[1:10:46] bequest, they may restrict it to a
[1:10:50] specific branch.
[1:10:53] Um, and donations with uh friends and
[1:10:56] friends of the library or the
[1:10:58] foundation, they do the same. Um, so
[1:11:02] that's why we call it restricted.
[1:11:05] Um, okay. So, next is our fund balance.
[1:11:10] And as Chair McKenzie mentioned is that
[1:11:15] um we do not have that statement in this
[1:11:19] uh packet because we are still working
[1:11:22] through budget adjustments, closing our
[1:11:25] uh projects. So that um all of those
[1:11:30] figures uh have a an effect on the fund
[1:11:33] balance on reducing if we used so if
[1:11:38] anything that was assigned and we reduce
[1:11:40] we used it we make those adjustments so
[1:11:43] that we can then have a final unassigned
[1:11:47] uh figure.
[1:11:50] Um if you're interested, you can go back
[1:11:53] to prior months um that you've received
[1:11:56] and look at that fund balance statement
[1:11:59] and maybe you know you'll have some
[1:12:02] questions for our next meeting.
[1:12:06] Um okay.
[1:12:13] Wow. Yeah.
[1:12:15] The next um
[1:12:18] report that you see is uh voucher
[1:12:22] payments over $50,000. At some point um
[1:12:27] the commission wanted to receive a
[1:12:30] report of any any bill any any payment
[1:12:33] that was over $50,000. So this is this
[1:12:36] history.
[1:12:39] Any questions so far? Okay. Not a
[1:12:43] surprise. We've seen all
[1:12:46] the uh the next um report is other
[1:12:51] contract services. that is a an account
[1:12:55] that you see on your detailed sheets and
[1:13:01] um
[1:13:03] and and because it includes a variety of
[1:13:07] of of vendors, uh the commission had in
[1:13:11] some time in its history requested to
[1:13:14] see a list of vendors that are
[1:13:18] recorded in this account. And so there
[1:13:21] you are. Any
[1:13:24] questions on this?
[1:13:26] >> Well, things like this list of vendors,
[1:13:30] » Well, things like this list of vendors,
[1:13:30] is there a reason for us to have to know
[1:13:33] this or is it more or less a team that
[1:13:37] wind up being nothing we need to really
[1:13:40] know?
[1:13:41] >> There's a couple of reports in here. I
[1:13:43] » There's a couple of reports in here. I
[1:13:43] was going to go through these one by one
[1:13:44] but to answer that specific question uh
[1:13:47] in the in prior times when there were so
[1:13:49] many so much turnover and changes in CFO
[1:13:53] and this and that and the other thing
[1:13:54] there were some people who had concerns
[1:13:57] about certain stuff and one of them as
[1:13:59] you mentioned was this voucher we want
[1:14:01] to see these bigger payments so that's
[1:14:03] what that report is on this this could
[1:14:06] be a recommendation out of our committee
[1:14:08] if we wanted to I don't know if we
[1:14:10] should talk to the management see if
[1:14:12] they want keep the bonus. But that
[1:14:14] that's where that came from. And
[1:14:15] certainly this other contract services,
[1:14:17] it was a big concern about I think legal
[1:14:20] services or something at the time. And
[1:14:22] it's kind of well, we want to see what
[1:14:23] what else you're contracting with. So
[1:14:25] these were came out of some uh feelings
[1:14:28] that prior commissioners had about what
[1:14:31] was going on. I don't think we have
[1:14:33] those same kind of concerns now. I mean,
[1:14:35] you bring up a good point. So whether um
[1:14:38] we want to continue to ask these be
[1:14:43] prepared, you know, is something that we
[1:14:46] should discuss when we're at full
[1:14:47] strength and have to look at stuff. I
[1:14:50] was going to kind of go through all of
[1:14:51] these because from a commissioner
[1:14:53] standpoint, there's certain things that
[1:14:54] we should that we focus on that'll make
[1:14:56] your life a little easier. I don't want
[1:14:58] you to think that, you know, be
[1:15:00] discouraged by this because, you know,
[1:15:02] it's a lot of stuff and, you know, we
[1:15:05] look at things differently on the
[1:15:07] quarter and we look at things different
[1:15:09] at the end of the year, but on a monthly
[1:15:11] basis, we're looking at a more
[1:15:13] streamlined
[1:15:15] uh, you know, outlook. And I really
[1:15:18] appreciate Merida's efforts to, you
[1:15:20] know, walk us through this kind of
[1:15:21] detail, but you're hitting deep detail
[1:15:23] today that you won't necessarily have,
[1:15:26] you know, every month to to look up.
[1:15:28] >> Yeah. And I can um answer part of the
[1:15:31] » Yeah. And I can um answer part of the
[1:15:31] question. So, you know, there are
[1:15:33] certain, you know, we have certain line
[1:15:34] items in each of our department budgets
[1:15:37] and I think we we can't provide um a
[1:15:40] level of detail because some of the um
[1:15:44] some of the items are kind of very broad
[1:15:46] in general and so other contract
[1:15:48] services that appears in all of the
[1:15:50] departments and I think there was a like
[1:15:52] commissioner McKenzie said that there
[1:15:54] was a concern that things were being
[1:15:57] kind of hidden in that uh and so this is
[1:16:00] what was the result of that. So, just to
[1:16:03] see and if you ever have any questions
[1:16:05] about, you know, what these are for, you
[1:16:08] know, we can certainly answer them. Um,
[1:16:10] but it does comprise a variety of
[1:16:12] different, it's mostly professional
[1:16:13] services. So, you know, we hire a
[1:16:16] strategic planner that goes in other
[1:16:17] contract services. We hire an executive
[1:16:20] coach that goes in other contract
[1:16:21] services. our translation with Barbie.
[1:16:24] Um some of our um our other uh you know
[1:16:28] HR our fingerprinting goes in other
[1:16:30] contract services. So it's kind of a
[1:16:32] catchall place where these professional
[1:16:34] services that we contract out for uh
[1:16:37] exist.
[1:16:40] » I I would like to add that it's not
[1:16:42] unusual. It is a common practice in or
[1:16:45] in uh reporting out in in transparency
[1:16:48] and communication
[1:16:50] uh with uh the governing board. So it's
[1:16:55] not unusual this have this level of
[1:16:58] detail.
[1:17:00] >> Well, that's good to know. It's always
[1:17:01] » Well, that's good to know. It's always
[1:17:01] better to have it. You know, you don't
[1:17:04] have to look at it, but you have it. And
[1:17:05] you I appreciate your point of is it
[1:17:08] extra work, but it is like set up. No,
[1:17:10] >> right. I mean those are no it's it's a
[1:17:12] » right. I mean those are no it's it's a
[1:17:12] good practice I would say
[1:17:18] okay
[1:17:20] um
[1:17:25] if you do you have any qu did um chair
[1:17:29] McKenzie did you want to go over any
[1:17:30] other specifics because I'm towards the
[1:17:33] end that I was going to wrap up but if
[1:17:35] you had any other questions on other
[1:17:37] reports go over that I don't have any
[1:17:40] more questions questions. Do any of you
[1:17:42] any either excuse me
[1:17:47] have any questions about um I would say
[1:17:51] it's the first four pages of our
[1:17:57] after that
[1:18:08] Step out.
[1:18:12] » We can just take a pause.
[1:18:27] Unless Eve or Kimberly, you have a
[1:18:29] question just about, you know, the forms
[1:18:32] in general.
[1:18:34] No, I you know I was looking in the
[1:18:37] wrong place and I got a little lost on
[1:18:39] this page, but I'm just going to look at
[1:18:41] it and think about it after the meeting.
[1:18:43] If I still have a question, I'll call
[1:18:48] you
[1:18:49] >> and it it takes time to
[1:18:51] » and it it takes time to
[1:18:51] >> it takes time to to get to know all
[1:18:54] » it takes time to to get to know all
[1:18:54] these
[1:18:55] >> also.
[1:18:56] » also.
[1:18:56] I was following for a little while.
[1:19:04] » I'm sorry. I sw something went down
[1:19:06] wrong. And
[1:19:08] >> anyway, where are we?
[1:19:13] » We're wrapping it up.
[1:19:14] >> Wrapping it up.
[1:19:17] » Wrapping it up.
[1:19:17] So anyway, let me go back to the top
[1:19:20] page here, the summary. So you're going
[1:19:24] to see that once a year. This is the
[1:19:26] year in sum. Next month you'll see that
[1:19:30] month's information.
[1:19:32] One of the things that I found helpful
[1:19:34] in the last while is the percentages.
[1:19:39] A way to kind of guide to for your own
[1:19:42] benefit like where we are in our
[1:19:44] expenditures
[1:19:46] and if it's the first month that would
[1:19:48] be is it 12%.
[1:19:51] No, that's not
[1:19:54] 112
[1:19:55] >> 112.
[1:20:00] » It's what?
[1:20:05] » But as we go along, it's kind of an easy
[1:20:06] way you can check and monitor. And
[1:20:08] again, we're in just so much better
[1:20:10] shape. [clears throat] It's so much more
[1:20:13] clear where we are. But that'll you'll
[1:20:16] see that next month.
[1:20:17] >> Yeah. So then a whole in the summary
[1:20:20] » Yeah. So then a whole in the summary
[1:20:20] cover page. salaries and benefits. You
[1:20:23] look at total effective budget, we spent
[1:20:26] 93 993%
[1:20:29] of the budget,
[1:20:31] >> which is pretty darn good budgeting.
[1:20:33] » which is pretty darn good budgeting.
[1:20:33] >> So on and so.
[1:20:35] » So on and so.
[1:20:35] >> Yeah.
[1:20:36] » Yeah.
[1:20:36] And again, next month you're going to
[1:20:38] see one month's worth.
[1:20:40] Um, but it's also September, so it's a
[1:20:43] quarter. So we are going to have all
[1:20:44] these reports.
[1:20:45] >> September quarterly. You'll see in
[1:20:47] » September quarterly. You'll see in
[1:20:47] October.
[1:20:48] >> Oh, okay. I'll get October.
[1:20:50] » Oh, okay. I'll get October.
[1:20:50] The second page, the cash balance
[1:20:52] summary. The most interesting thing on
[1:20:54] this to me is that uh this has all these
[1:20:58] details of these individual bequests.
[1:21:00] This has all been cleaned up enormously
[1:21:03] by our wonderful staff who this used to
[1:21:07] be a kind of big mush mish mash and this
[1:21:10] has all um been identified by the
[1:21:13] individual donors and so forth. Um the
[1:21:16] voucher thing again what I always look
[1:21:19] at is just that top month the latest one
[1:21:23] you've got the whole year but you know
[1:21:24] the top one is what you want to look at
[1:21:26] so you don't have to spend you know a
[1:21:29] lot of time on that report the contract
[1:21:31] services are is you know interesting
[1:21:33] again to just to keep an eye on things
[1:21:35] and then you get into these details it's
[1:21:37] for us to have but we don't spend a lot
[1:21:39] of time in the finance committee going
[1:21:41] over any of that except if anybody has
[1:21:43] any questions. So anyway, I don't want
[1:21:46] you to feel, you know, bogged down in in
[1:21:50] reporting when we come here. Um,
[1:21:53] I think that's all I was going to say
[1:21:57] about that.
[1:22:02] This this final uh page here, I don't
[1:22:04] know what this my pages aren't numbered,
[1:22:06] so I'm not sure what to call this. The
[1:22:08] allocation of actual expenditures.
[1:22:10] >> Yeah. So this report I like to show have
[1:22:15] » Yeah. So this report I like to show have
[1:22:15] a policy
[1:22:16] of
[1:22:20] we we have a policy
[1:22:24] allocation of major revenues where um
[1:22:29] it provides guidance to staff on how to
[1:22:34] I primarily use it for uh formulating
[1:22:38] the budget And um and so we know how
[1:22:43] what percentage uh what percentage of
[1:22:45] the expenditures
[1:22:47] are allocated to
[1:22:51] property tax and to sales tax and um and
[1:22:55] so at the end of the or on a quarterly
[1:22:58] basis but
[1:23:00] uh here and year end um if you look at
[1:23:05] the actual expenditures okay and I do
[1:23:08] say does not include the incumbrance but
[1:23:10] just actuals what has been out the door.
[1:23:13] Um
[1:23:15] we know through the
[1:23:18] the policy that expenditures
[1:23:22] capital expenditures are allocated 10%
[1:23:26] to property tax and 90% to sales tax. So
[1:23:31] basically this chart is a summary of uh
[1:23:34] how much was spent in property tax, how
[1:23:38] much was spent in sales tax and then
[1:23:41] gives you the the split and it should
[1:23:44] match the budget on how the budget was
[1:23:48] adopted. Um
[1:23:51] so we have uh the first two charts uh
[1:23:54] show the serviceoriented divisions. Uh
[1:23:57] we the policy states that um capital is
[1:24:02] 10% to property tax, 90% to sales tax.
[1:24:06] It uh it pro gives us a range on
[1:24:09] salaries, services and other charges. So
[1:24:13] when the budget was adopted, the
[1:24:15] percentage to property tax was 62% and
[1:24:19] 38% to sales tax.
[1:24:23] Under administration divisions, the
[1:24:26] policy is a little is more strict. Um,
[1:24:29] it states that the property tax pays 90%
[1:24:33] of those expenditures and sales tax pays
[1:24:36] 10% of those expenditures.
[1:24:38] But when we add them all up, the the uh
[1:24:42] all the divisions together is the LA is
[1:24:44] the third col um chart. And um and then
[1:24:49] I give you it essentially all blended
[1:24:52] together. The property tax has picked up
[1:24:54] 62% of expenditures and sales tax 38%.
[1:25:01] » This was a real important, you know,
[1:25:03] kind of bottom line thing like in terms
[1:25:05] of our funding, right? It's really nice
[1:25:07] to see that 6238 because sometimes we'd
[1:25:10] say two 2/3 one whatever. I mean, this
[1:25:13] is a real number and I'd like to add a
[1:25:15] tiny bit of background here. Before
[1:25:18] Measure Y was passed, it was all
[1:25:20] property tax. When Measure Y was passed,
[1:25:22] it was passed with an expenditure plan.
[1:25:25] So, the public was told, "This is what
[1:25:27] we're going to spend your money on." And
[1:25:29] it wasn't to take away uh some book
[1:25:34] budget to spend it for something else
[1:25:35] and then supplement it with measure Y.
[1:25:37] It was supposed to be an additional
[1:25:39] amount. And so for several years we went
[1:25:42] through this kind of a very hazy period
[1:25:44] where it really wasn't clear the
[1:25:47] allocation of the pro of the measure Y
[1:25:49] money and again going through several
[1:25:51] CFOs was very blurry whatever and then
[1:25:55] America came along and understood that
[1:25:57] we really had to have a policy a written
[1:25:59] policy what percent well how the heck do
[1:26:01] you figure that out but she came up with
[1:26:03] this rather brilliant plan of looking
[1:26:06] back and seeing what it had
[1:26:08] traditionally been and now it's a set
[1:26:11] formula. It isn't exactly to the penny,
[1:26:14] but the 9010 is is exact. And so we're
[1:26:18] never going to spend more of our um the
[1:26:22] measure Y money is going to be spent on
[1:26:24] buildings, for example. Um and the and
[1:26:26] the 10% will come from property tax, but
[1:26:29] 90% is going to come from measure one so
[1:26:31] this is incredibly valuable tool to have
[1:26:34] that is in place. what it's been three
[1:26:35] or four years or so since you came up
[1:26:37] with this. And um how long has it been
[1:26:42] five?
[1:26:42] >> It'll be five in know uh let's see I
[1:26:45] » It'll be five in know uh let's see I
[1:26:45] started in November of 21 and then I
[1:26:47] think it was adopted in January or
[1:26:49] February. So yeah up we're coming up to
[1:26:51] five years. Fantastic.
[1:26:54] >> I started in June 2021. So I just had my
[1:26:58] » I started in June 2021. So I just had my
[1:26:58] fiveyear anniversary.
[1:26:59] >> Oh bra.
[1:27:00] » Oh bra.
[1:27:00] >> I'm vested now.
[1:27:02] » I'm vested now.
[1:27:02] >> Wow. Cool. That's great. So the um the
[1:27:06] » Wow. Cool. That's great. So the um the
[1:27:06] measure Y oversight committee the
[1:27:09] citizens oversight committee is meets
[1:27:11] this Thursday and so I will be
[1:27:14] presenting the same information and this
[1:27:17] that's where this chart is particularly
[1:27:20] of interest to that committee.
[1:27:22] >> Yes. And it wasn't clear and I used to
[1:27:25] » Yes. And it wasn't clear and I used to
[1:27:25] talk about this because I was really
[1:27:26] worried the grand jury would come in and
[1:27:29] do an investigation. No one could
[1:27:31] understand what I was saying or would
[1:27:33] listen to what I was saying about this.
[1:27:34] And so it was finally, you know,
[1:27:36] Meredith who really got what I was
[1:27:38] talking about and and Judy Glenn on the
[1:27:41] Measure Y committee used to say the same
[1:27:43] thing too. Well, wait a minute. This,
[1:27:44] you know, whatever. So anyway, feel
[1:27:48] secure that we have a formula and it
[1:27:50] really works and it's justifiable and it
[1:27:53] makes sense and the expenditure measure
[1:27:55] Y money is very clear now. Another
[1:28:01] piece that um that this committee we
[1:28:06] that staff reports to and this committee
[1:28:09] are updates on policies and procedures.
[1:28:12] And um
[1:28:16] we we normally like to report this like
[1:28:18] in February or March, but uh here's a
[1:28:22] summary that you know the budget and
[1:28:26] financial services team has completed
[1:28:28] the following more than this but these
[1:28:32] are the highlights. Uh updated the
[1:28:34] grants management process. Uh supported
[1:28:38] the update to the gifts and donations
[1:28:40] policy. Um, we've implemented the
[1:28:44] incumbrance module in EFS, which is our
[1:28:47] financial system to support greater
[1:28:50] budget controls. We prepared an
[1:28:52] additional analysis for the additional
[1:28:55] discretionary payments to pay down the
[1:28:57] pension unfunded acred liability. Um, we
[1:29:01] will be making our first payment uh by
[1:29:04] December of this fiscal year. Uh BAPS
[1:29:08] has also had a key role in uh prep
[1:29:11] preparing for the financing and the
[1:29:14] purchase of the uh operations
[1:29:18] uh center building
[1:29:20] and um in September we we uh plan to
[1:29:24] share with you an update on the
[1:29:27] purchasing policy. Um it's been in good
[1:29:31] it's been needed to make some updates on
[1:29:34] that and uh we'd like you to provide you
[1:29:37] some information also on bequest. Um so
[1:29:41] that that concludes my report today and
[1:29:46] unless you have any more questions.
[1:29:51] » So when I was uh coughing did I miss
[1:29:54] Katherine's appropriation transfer? No,
[1:29:58] we haven't on there yet.
[1:29:59] >> Okay.
[1:30:00] » Okay.
[1:30:00] >> Nothing to report.
[1:30:01] » Nothing to report.
[1:30:01] >> I know, but it's on the agenda, so you
[1:30:04] » I know, but it's on the agenda, so you
[1:30:04] can report that we have nothing to
[1:30:05] report.
[1:30:07] >> So, that's the next item on the agenda.
[1:30:10] » So, that's the next item on the agenda.
[1:30:10] Um,
[1:30:13] >> I thought you had jumped to the
[1:30:14] » I thought you had jumped to the
[1:30:14] workflow. That's why I was asking.
[1:30:16] >> No, we haven't.
[1:30:19] » That is correct. We had no appropriation
[1:30:22] transfers this past quarter. Um to give
[1:30:25] you some background, we have an
[1:30:27] appropriation transfer policy and it's
[1:30:30] to allow um within the director's
[1:30:35] delegation authority to move within
[1:30:37] budget small items. Um so say
[1:30:42] um when you look at the budget, I I made
[1:30:44] a budget that I was going to spend
[1:30:46] 10,000 in other contracts, but maybe I
[1:30:50] throughout the fiscal year I end up
[1:30:52] using it somewhere else. allowed to move
[1:30:54] that like I said as long as it's within
[1:30:56] the director's delegation of authority
[1:30:59] and then we report it quarterly all of
[1:31:01] those sources.
[1:31:03] >> Yeah, I can give you an example of that.
[1:31:05] » Yeah, I can give you an example of that.
[1:31:05] Like so we have our other contract
[1:31:07] services and then we have another line
[1:31:10] item that's very similar to that and I
[1:31:11] forget outside consulting. And so my
[1:31:14] contract for the strategic plan, for
[1:31:16] some reason, all of the money was
[1:31:18] encumbered in other contract services
[1:31:21] and it was a little over. So I took some
[1:31:23] of the money from outside consulting and
[1:31:27] I put that into um outside or other
[1:31:30] contract services just so that you know
[1:31:32] I was still staying within my budget.
[1:31:37] Um so just a little bit of background on
[1:31:40] that is
[1:31:43] that those level of tr of of
[1:31:47] transactions as small as it might be
[1:31:49] $5,000 and you know from training into
[1:31:52] office supplies
[1:31:54] um that authority lies with the
[1:32:00] governing board.
[1:32:02] Uh so when we we couldn't make those
[1:32:06] those those uh transfers
[1:32:09] um and
[1:32:11] it happens quite a bit three four times
[1:32:14] in a quarter and uh and we would have to
[1:32:18] come to so I would put everything on
[1:32:20] hold until mid year and then have these
[1:32:24] small amounts uh transferred uh at the
[1:32:27] midyear report um uh point but Um
[1:32:33] uh in talking to the county, the best
[1:32:36] practice is well if you have a policy
[1:32:38] where the governing board then delegates
[1:32:41] that authority to staff the director or
[1:32:45] and the CFO in this case in this in this
[1:32:47] policy then it sets a a process for um
[1:32:53] the library to make these routine um uh
[1:32:57] transactions and uh and then for
[1:33:00] transparency purposes provide this
[1:33:03] committee and the commission a report of
[1:33:06] how monies were moved around in the
[1:33:08] budget. That policy does give us
[1:33:11] restrictions. There are restrictions. So
[1:33:14] we cannot we won't be able to move funds
[1:33:17] from you know uh the new fund where
[1:33:21] we're tracking the proceeds into
[1:33:23] property tax that we will have to still
[1:33:27] get authority and and the commission
[1:33:30] will have to approve that.
[1:33:32] >> So for our gifts and donations so we
[1:33:34] » So for our gifts and donations so we
[1:33:34] cannot move money out of any of our um
[1:33:37] restricted funds our our bequests um I
[1:33:41] cannot do that only the commission can
[1:33:42] do that. So that was one of the um
[1:33:45] exemptions
[1:33:49] » all about transparency.
[1:33:51] >> Yeah.
[1:33:53] » Yeah.
[1:33:53] >> Okay.
[1:33:53] » Okay.
[1:33:53] >> Oh, and controls.
[1:33:55] » Oh, and controls.
[1:33:55] >> What?
[1:33:56] » What?
[1:33:56] >> Controls.
[1:33:58] » Controls.
[1:33:58] >> Those are key.
[1:34:00] » Those are key.
[1:34:00] >> Okay. So, uh any questions about the
[1:34:03] » Okay. So, uh any questions about the
[1:34:03] appropriations, transfers,
[1:34:06] um and then we have a workflow that our
[1:34:10] CFO put together for us a few years ago.
[1:34:12] It was so kind of help people.
[1:34:15] >> The only thing I noticed when I looked
[1:34:16] » The only thing I noticed when I looked
[1:34:16] at this one is that we used to have uh
[1:34:19] when the finance committee would see it
[1:34:20] and then when the commission would see
[1:34:22] it. Did you did you take the commission
[1:34:24] part off that for a reason?
[1:34:27] I think so. I think I received feedback
[1:34:30] to simplify the chart.
[1:34:34] Um but normally the fi the normally what
[1:34:38] happens is the month that you see here
[1:34:41] right the finance committee sees it in
[1:34:43] August the commission normally sees it
[1:34:46] the following month unless this finance
[1:34:49] committee says no we need more work
[1:34:51] bring it back to the finance committee
[1:34:53] but it will not advance any item will
[1:34:55] not advance unless this committee has a
[1:34:58] consensus to recommend it to the full
[1:35:01] commission.
[1:35:04] Well, if it's not a problem, we can, you
[1:35:06] know, we'll leave this new version. I
[1:35:10] did want to say that I was thrilled to
[1:35:12] see in February the five-year forecast.
[1:35:16] >> We've been talking about that for so
[1:35:18] » We've been talking about that for so
[1:35:18] long and and I noticed it was referenced
[1:35:20] in that AMN report that we had the
[1:35:22] five-year help forecast really helped
[1:35:24] with that.
[1:35:25] >> Yes. though um the commi the I did
[1:35:29] » Yes. though um the commi the I did
[1:35:29] provide a forecast to the commission
[1:35:32] over um leading up to the decision of
[1:35:37] the acquisition. That was the biggest
[1:35:39] impetus for that. Yeah,
[1:35:41] >> we did have a a forecast prior to that,
[1:35:45] » we did have a a forecast prior to that,
[1:35:45] but it had not been updated and it was
[1:35:49] it was just a good timing to update that
[1:35:52] force cast given the the the decision
[1:35:55] before the commission.
[1:35:56] >> Yeah.
[1:35:57] » Yeah.
[1:35:57] >> Um so I do have it here to program it to
[1:36:01] » Um so I do have it here to program it to
[1:36:01] to update it annually.
[1:36:04] And the other thing I was really happy
[1:36:06] to see was the the draft policy for
[1:36:09] allocation appropriation of fiscal
[1:36:11] surplus.
[1:36:12] So I won't go into that today, but you
[1:36:15] know, in the past we wondered about what
[1:36:17] the policy was when we have, you know,
[1:36:21] these funds, these they're one-time
[1:36:23] funds and they're the unassigned fund
[1:36:26] balance funds, right? And so what do we
[1:36:28] do with that money? We've never had a
[1:36:30] policy about it. it's been um somewhat
[1:36:33] you know kind of reactive to the
[1:36:35] circumstances and what we've needed for
[1:36:37] and then there you know the fixing up of
[1:36:39] the different libraries and so forth
[1:36:40] there hasn't been a real clear policy
[1:36:42] about so anyway I'm great that you're I
[1:36:46] know you have mentioned that Erica in
[1:36:47] the past why why we needed a policy so
[1:36:50] I'm glad that's going to be before the
[1:36:52] committee in November so
[1:36:55] any questions I know it's can be kind of
[1:36:57] overwhelming all the the information
[1:37:00] today But u I really appreciate uh MNA's
[1:37:04] efforts to give you the full picture
[1:37:08] which she did very well and Erica's
[1:37:10] comments on the
[1:37:13] a lot of the specifics any um thing that
[1:37:17] you would like to know more about or
[1:37:20] is it time to digest?
[1:37:25] Well, my two questions I guess are ones
[1:37:28] that are going to be answered later in
[1:37:30] the year. I just thought also it's
[1:37:33] important to for me at least to get a
[1:37:35] handle on the different kinds of funds
[1:37:39] once this season fund balance I kind of
[1:37:44] understand that when there's a big
[1:37:46] surplus take from it when you need to
[1:37:48] take from it as things come up and then
[1:37:50] eventually there isn't the big surplus
[1:37:52] and then what happens then how do we do
[1:37:54] planning for that. And then my other
[1:37:57] question I guess that's it's not a
[1:37:59] question exactly just a concern is so it
[1:38:04] seems like costs for most things keep
[1:38:08] going up whether it's for
[1:38:11] FFN stuff whether it's for um labor
[1:38:15] costs
[1:38:17] well what happens over time since that
[1:38:20] seems to be a trend if our income either
[1:38:24] stays flat or goes down.
[1:38:27] What happens then? Is that part of the
[1:38:30] surplus that goes in there? And I I
[1:38:33] don't you know long-term planning kind
[1:38:35] of or not longterm midterm. How does it
[1:38:38] look? What happens?
[1:38:41] >> Well, that would be part of the
[1:38:42] » Well, that would be part of the
[1:38:42] forecast.
[1:38:43] >> Yes.
[1:38:46] » Yes.
[1:38:46] >> You'll also see the reserves on the fun.
[1:38:49] » You'll also see the reserves on the fun.
[1:38:49] See the fund balance activity report.
[1:38:52] See those reserves. We have in fund
[1:38:53] balance policy. We have policy about re
[1:38:56] rainy day funds and what's the other one
[1:38:57] anyway you know there's there's a lot of
[1:39:01] builtin support to those kind of
[1:39:03] questions about lesser lesser income but
[1:39:06] um I'm really glad that we'll have this
[1:39:08] policy to plan just what we're talking
[1:39:11] about that's what we got that money
[1:39:18] you know policy way so um again
[1:39:24] starting off um asking very good
[1:39:26] questions and you know there's a pretty
[1:39:28] steep learning curve about all of it I
[1:39:30] found and um but you're asking
[1:39:35] >> yeah and you know when we do ourou
[1:39:37] » yeah and you know when we do ourou
[1:39:37] negotiations we do actually look at um
[1:39:41] you know our projected revenue increases
[1:39:45] and what we can what we think we can
[1:39:47] afford in terms of cost of living
[1:39:49] adjustments. So um you know we our
[1:39:52] contract ends in 2027. It feels like we
[1:39:55] just finished it. Um but we will be
[1:39:57] doing that analysis again you know um
[1:40:00] this time next year. Um we will be
[1:40:02] looking at our revenues as well as you
[1:40:05] know MNA is always talking to the county
[1:40:07] about their projections as well and then
[1:40:10] coming up with um you know colas that we
[1:40:12] think we can reasonably afford and not
[1:40:15] you know not promising more than um we
[1:40:18] think we can deliver.
[1:40:23] But then some of our building projects,
[1:40:25] you know, we've we've reduced scope um
[1:40:28] so that we have stayed within budget for
[1:40:30] our building project. So there we have a
[1:40:33] variety of different tools we can use to
[1:40:35] make sure that we're kind of staying
[1:40:36] within budget. Um and that is one of
[1:40:39] them.
[1:40:43] Okay.
[1:40:45] >> Well,
[1:40:48] we're on the the workflow. So,
[1:40:52] as you can see, are they Oh, yes. So,
[1:40:55] like in October, you'll see capital
[1:40:57] project update one. So, on a quarterly
[1:41:00] basis, I provide another control and
[1:41:04] report back to the committee is what is
[1:41:08] the status of the capital projects? uh
[1:41:13] how much what what the budget is, how
[1:41:15] much was has been spent, how much work
[1:41:18] um and any reports on delays that have
[1:41:21] happened um are reported here. So we do
[1:41:26] make modifications, you know, definitely
[1:41:29] we've received much very good feedback
[1:41:32] from the the finance committee. I'm
[1:41:34] like, "No, we don't support an increase
[1:41:36] of that much or what are you what are we
[1:41:40] getting for the for this amount of
[1:41:41] money?" Um, all of those really good
[1:41:45] questions and uh, you know, we we it's
[1:41:48] an iterative process and staff has then
[1:41:51] come back with something that's more
[1:41:53] palatable to the committee and uh, and
[1:41:56] then, you know, recommended to the the
[1:41:59] full the full commission. So, it's a
[1:42:02] it's a it's a good a really good role
[1:42:05] and um iterative process with with the
[1:42:08] finance committee that plays in in
[1:42:11] making these decisions to stay within
[1:42:13] budget and uh yeah,
[1:42:16] >> you really enjoy being on the finance
[1:42:18] » you really enjoy being on the finance
[1:42:18] committee because it's a it's just a
[1:42:22] deeper dive into stuff. I hate using
[1:42:25] that term, but anyway, the, you know, we
[1:42:27] go to our commission meetings once a
[1:42:28] month and we learn, you know, kind of
[1:42:30] basic stuff, but this you really kind of
[1:42:31] get into a lot of the meat and potatoes
[1:42:34] and just working together in a smaller
[1:42:36] group is great and working closer with
[1:42:38] the staff is great and I think you'll
[1:42:40] really enjoy it. And um
[1:42:43] so last call for any questions before we
[1:42:45] talk about uh oh, items for future. What
[1:42:50] would you like to talk about at a future
[1:42:52] meeting?
[1:42:55] If not,
[1:42:56] >> I just said mine
[1:42:59] » I just said mine
[1:42:59] in the next.
[1:43:01] >> Okay,
[1:43:02] » Okay,
[1:43:02] >> we'll just follow the process then, but
[1:43:05] » we'll just follow the process then, but
[1:43:05] you can always add items on and the end
[1:43:08] of a meeting. Um, next meeting is uh
[1:43:12] we'll stay with our current schedule
[1:43:14] which is would be Monday uh September
[1:43:16] 21st, the third Monday at 2 o'clock and
[1:43:19] then see where we are or who's here and
[1:43:22] make decisions about more stuff.
[1:43:27] >> Thank you. So do I. Anyway, um,
[1:43:32] » Thank you. So do I. Anyway, um,
[1:43:32] cheers. Thank you for being here and
[1:43:35] everybody all the staff and the new
[1:43:37] commissioners and
[1:43:39] a great meeting.
[1:43:40] >> I I forgot to mention um according to my
[1:43:42] » I I forgot to mention um according to my
[1:43:42] calendar Monday the 21st is Yam Kapoor
[1:43:48] » Yam Kapoor.
[1:43:49] >> Yeah. Do we want to reschedule the
[1:43:51] » Yeah. Do we want to reschedule the
[1:43:51] finance committee meeting? I'm fine with
[1:43:53] that if if it's a
[1:43:59] » just want to make sure that we're not uh
[1:44:01] violating anybody's religious freedoms.
[1:44:04] >> So, we're good with that.
[1:44:07] » So, we're good with that.
[1:44:07] Okay, we will proceed then and uh hope
[1:44:11] to see you in September.
[1:44:13] Goodbye.