All right. Welcome, everyone.
We'll get our workshop started.
Today is September 21st, and we
have a workshop today on the
biennium budget. So let's just
as a reminder, have make sure
your mics on when you speak and
state your name. And we'll get
started with staff introducing
themselves.
>> Good afternoon, Mayor Pro
Tem Council community. Lisa
Brandel, deputy city manager.
>> Good afternoon. Kadee Skylee
Chief Financial Officer Good to
see you.
>> Are you ready to begin?
>> Yes. Okay, we'll go ahead
and get started. This is our
workshop on the City Manager's
recommended biennium budget
preview. And we'll go ahead and
get started. And so we have
prepared an agenda here. We are
going to start with opening
remarks from our City Manager,
Lannen Pluckhahn. We are going
to go over the budget
presentation history, how we've
gotten here to this point, and
the status, an overview of the
2728 biennium budget. It's a
preview, an overview, and and
highlights. We're going to go
into some specific highlights
of the budget. And then we are
going to discuss revenue. The
strategies that we've talked
about a few times with you. On
the budget and how we prepared
it and update on the general
fund, Fire and Street Forecast.
We're going to talk a little
bit about the timeline, the
remaining timeline on the
biennium budget, and then have
opportunities for discussion.
But at any time during this
presentation, please feel free
to ask us any questions. So
with that, I'm going to turn it
over to our city manager,
Lannen Pluckhahn. To start with
opening remarks.
>> All right. Thank you, Lisa.
So I'm happy to be able to
bring the council, the current
state of the budget as we head
towards October, which is our
publication deadline leading
into November, which would be
the final approval of the
budget. And as the Council may
remember, we've approached this
budget season a little
differently than we have in the
past. One of the things that I
wanted to commit to early on
was really going back and
taking a very close look at how
the city used the money that we
already had, and use that to
frame how the budget would be
shaped going forward. And as we
really got into some of the
items related to the budget, I
know you've heard me use the
term reset budget for some of
the items that really were need
more study than we were going
to be able to complete leading
in the run up to this budget.
And so some of those decisions
led us to being able to pause
some ongoing expenses,
including things like
contributions to the city's
vehicle fund for equipment
repair, and replacement for all
of the rolling stock that we
buy for our non public safety
related departments. And I say
that because I know that the
numbers definitely look better
in the third year than they had
in the past. But I just want to
be a little bit cautious about
that, because some of the
decisions that we have made now
are holding year three on the
forecast artificially lower
than it would be. We would
fully anticipate that some of
those costs and expenses will
have to show up into the next
year's budget. But compared to
where we started with a looming
deficit for the coming biennium
that we were largely able to
eliminate through a combination
of ongoing expense changes and
also some one time use of funds.
I'm pretty happy with where
we're sitting, and one of the
things I just want to
acknowledge is that, you know,
I feel like there might be a
little bit of budget whiplash
going on with people having
looked at the budget numbers
the first time and remembering
what we went through in 2024,
where we ended up having to do
staff reductions and did some
pretty dramatic staff
reductions to where we're
sitting now, where we're not
projecting a deficit going
forward. And we're actually
able to not only continue to
put funding towards some of the
council's ongoing priorities,
but also address some of the
ones that council has asked us
to look at over the last couple
of years. So there are some
decision points in there where
we still need some input from
the City Council during this
session that will really help
us shape the next iteration of
the budget, and that would be
the one that would be headed
out towards publication on
October 1st. And full printing
and public consumption. So with
that, I will turn it back over
to Lisa and Katie, unless you
have any questions for me ahead
of that.
>> Do you have any questions?
Okay. No questions. Let's go
ahead.
>> Okay. Thank you. Okay. We're
going to start a little bit
about the process and how we
got to this point, going over
the budget presentations that
we've shared with you since the
spring. Starting with today,
we've had a total of four
budget workshops starting in
April 27th and then in July.
And we had a brief, a August
24th. We do have ongoing
structural deficit about that
later, although it has closed a
little bit. When you saw it in
August, the the structural
deficit comes from deferral of
a decade through constrained
spending and new revenues. And
during the April, April 27th
workshop, we forecasted a
deficit. And as long mentioned
in his opening remarks, we
decided to analyze past legacy
practices, practices. The
structure of the budget makes
them operational decisions and
return in July. And then when
we returned in July, we shared
that we had a closure of the
deficit for 2728, forecasted
with use of one time funds,
pausing a program,
contributions, leveraging other
funding sources, new revenue,
and some internal operational
decisions. And during August,
we did some revision to the
financial and investment
policies, which were approved
by council. Thank you for doing
that. And we provided an update
to the budget on the work done
to date. And today we're going
to preview the city manager's
budget with the majority of the
status quo. Continuation of
council priorities, opportunity
for discussion with you and
receive your feedback and
preparation for the October 1st
budget publication. So with
that, we're going to go into
the overview of the 2728
biennium budget. So with this
budget, we have held department
spending patterns. In fact, we
have scrutinized them more than
in the past, which will have a
downstream effect in the future
years. We've made some
operational decisions that lay
the foundation for the city to
continue its work and meet the
challenges of the future. We've
been strategic on the use of
leveraging existing funding
that's pivoted away from
reliance on the general fund,
which also has a future
downstream effect. Importantly,
this budget continues the
priorities of council that has
been outlined in the strategic
plan and also addresses other
emerging issues such as public
defense. We are preparing for
the future needs that are
coming, such as debt service
for capital projects of the
Public Works Operational Center,
PFAs and other future impacts
such as annexation. We
reallocated the budget where
necessary, to fund needed
initiatives. We redefined the
ongoing budget from past
practices and pivoting to new
practice budget practices that
allow for planning for the
future. And so we are going to
talk about the highlights of
the work that's continuing to
be done, such as the
comprehensive plan
implementation, the continued
work in homelessness support
and outreach, public defense,
and affordable housing. So I'm
going to share something that
I've heard our city manager say
often. We often focus on what
we're not able to do, but not
on the work that we're doing
and what is possible. So
despite constrained resources,
these next slides show council
and the community what the city
is continuing to do while also
preparing for the future. We
are increasing funding for
public defense. We are
proceeding with construction
and or remodel of fire stations
three, six and eight with
proposition two bank capacity.
We're funding for seed work
into annexation, including a
partnership with Clark County.
We are supporting the opening
of the Bridge Shelter, which is
opening this fall, and the
study for the Performing Arts
Center, which is in process
right now. There are components
in the budget for the Heights
development, affordable housing,
the rental registration program,
and the Chekalov building
remodel and specific items
under equity, climate and
community safety. We're also
going to talk a little bit
about organizational resiliency,
which established resources for
the city to meet future needs
and prepare for unforeseen
circumstances. These next few
slides will highlight those
specific items under Programs
of interest, City Council
priority themes, and
organizational resiliency. So
the first slide we're going to
highlight the homeless program
within the budget. The included
in the budget is support for
the bridge shelter, which is
going to open this fall, as
well as an emergency shelter
assessment that develops a ten
year capital improvement plan
for all the city sites. The
assessment will include asset
management and future projects,
and the heart team is growing
in capacity due to the support
from the Lynch Foundation,
which is making a difference in
our community, and the Safe
Stays and Safe Park will
continue their operations.
Under climate. A couple of
items to highlight include a
pilot of EV charging stations
for public stations and
infrastructure implementation
for city wide vehicles. Also,
electronic vehicles are the
standard for our city fleet,
and anything different requires
an exception request. Parking
is requesting electronic
vehicles for their enforcement
vehicles, and our police
department is starting with a
pilot for two patrol vehicles.
Also included is a one time
funding recommendation for
solar installation installation
on the Firstenburg Community
Center. Under equity, the
equity goals of the
comprehensive plan
implementation are included.
Continued training for city
employees. Procurement will
launch their five year
Disparity study, and our
General Services and Parks
Department will work on Ada
transition plan, work in
various facilities and projects.
And under community safety
training and equipment
resources are included for fire
and is previously mentioned.
The proposition two bank
capacity will be used for fire
station projects. Funding for
an assessment of a regional
fire authority is also included
under police. In addition to
the funding for proposition
five, the Criminal Justice
Grant and public Safety sales
tax, funding for a headquarters,
land acquisition and resources
for equipment are also included
in additional note is that we
will be working with both
departments to establish an
equipment repair and
replacement strategy, which
does not exist currently, much
like we do for IT equipment, so
that funding is available when
needed and doesn't need to be
requested at every biennium.
Community safety also includes
transportation projects. These
are. These are. This is just a
highlight of some of the
projects under transportation
by no means includes all of
them. So under the category of
transportation, there is a
total of 51.2 million in
requested total projects. And
under Transportation and
mobility, there is a 101.100
and 1.1 million in projects
included in the 2728 budget.
And under economic development,
extension of a position is
included for continued support
for small businesses in the
downtown area and will also
assist small business
procurement, outreach and
tracking for our procurement
department. There's a request
for small business incubator
focusing on product to market
and construction and trade
programs that support both high
growth startups and culturally
aligned small businesses. It
also focuses on accessing new
markets and addressing local
small business capital and
support gaps in parking. The
parking wayfinding will assist
in improved site location
identifiers to the community in
downtown for parking, and the
circulator assists with support
for alternative mobility
options. Under organizational
resiliency. It refers to those
items in the recommended budget
that strengthen the city
externally and internally. We
do this by by anticipating long
term changes in building long
term viability. This is
expressed in different items
within the forthcoming
recommended recommended budget,
such as assessing our
facilities in the historic
trust and other existing
facilities, conducting
structural repairs in the
officer's row, dredging in the
marine boat in the Marine Park
boat launch area, replacing
equipment in our parks,
bringing on a professional
investment advisor for our
investment pool and sustaining
our departments in parks,
general services and finance to
reduce leadership
vulnerabilities. Under
Comprehensive plan. Now that
it's adopted, the
implementation work continues
and begins at the same time.
This includes review and
monitoring, implementation of
the equity goals, updating the
park's comprehensive plan, and
having the staff capacity for
key near-term goals and subarea
planning. And these are some of
the items relating relating to
the work for the comp plan.
It's just a highlight. There
are a few others in the
recommended budget. Under
boards and commissions. There
is a point here for discussion
with you in the recommended
recommended budget. There is a
recommendation for Boards and
Commissions coordinator. The
coordinator will will report to
the Director of Engagement and
Access and lead the day to day
work along with the coordinator.
There is a recommendation to
engage for services to review
all the boards and commissions
as required in the Council
policy 100 Dash six, which is a
review every four years of the
boards and commissions under
the leadership of the Director
of Engagement and Access, the
coordinator would handle this
work. In addition to any policy
updates, work with staff
liaisons on annual reports,
assist admin in scheduling,
work with you on direction for
board and commission
recruitments, goals, formation
and or dissolution, performance
measures and other direction.
If approved, the coordinator
position would allow the
director to continue her work
for Vancouver for all engaged
with the community and city
employees. At this point, the
breadth and level of the work
of boards and commissions
warrants a position up for
council discussion is the
request for an additional
position. A youth coordinator
that would work with the boards
and commissions. As it has been
stated by some counselors, the
desire to engage with youth
more. At this point in the
recommended budget, a youth
coordinator position was not
recommended at this time due to
trade offs that we had to make
in the budget. If there is a
desire for a youth coordinator,
it would be an additional
ongoing cost to the general
fund of approximately 121,000
per year. The boards and
commissions coordinator is the
same cost is the same annual
ongoing cost. So I'm going to
take a pause here and see if
Council would like to discuss
that. Adding a possible youth
coordinator position on top of
a boards and commissions
coordinator position.
>> All right. I'd also like us
to open up for questions on the
previous slides too. Sure.
Because this is a very narrow
topic and we just went through
20 slides before that. So why
don't we first see if anyone
has any thoughts or comments on
the question before us on Youth
Coordinator. Counselors.
>> I thank you, Mayor Pro Tem.
Long wanted this. So parting
shots. Yes, I, I would like you
know, we're building a city for
future generations. And I think
those voices need to be
integrated in order for them to
be integrated fully and
supported. Well, I think there
needs to be something to walk
through that somebody to walk
through the process with them.
So I, for one, am in support of
trying to find that funding.
Thank you.
>> Okay. All right. Counselor
Perez.
>> Thank you. I you know,
Ridgefield has just recently
added a youth council. The
center now has a youth council,
and we are a much bigger
population with a growing youth
population that deserves our
attention indoors and inclusion
into civic life. And for a very
long time, we we have tried to
incorporate services and
programs that really benefit
youth. At the end of the day,
we need a youth council for the
City of Vancouver, whether
that's coordinated by youth
coordinator or a different type
of position. We need a youth
council for the City of
Vancouver. It's ridiculous to
see our surrounding
jurisdictions that are way
smaller in population size be
further ahead than we are. And
so whatever we need to do to go
back and look at whatever
positions we don't want to
narrow it to just a youth
coordinator. But the outcome is
we want to have an established
youth council that we work with.
>> Councilor Harless.
>> Yeah, I would love for us to
explore how to do that as well.
And, you know, prioritizing the
boards and commissions
coordinator, obviously that
makes sense. However, I know
there's also other
opportunities. If it's not
somebody that is a youth
coordinator in title, maybe
it's an internship with one of
our colleges or universities
that are in the area. You know,
those students need internship
opportunities. Sometimes
they're at no cost or low cost
because they're getting credits
through the university, and
that could be under the boards
and commissions coordinator,
for example, who would oversee
that intern. I know we do
internships in many departments
here, so that might be an
opportunity there until when.
And if we could have someone
specifically as a youth
coordinator. But yeah, again,
agree with where Councilmember
Perez was going, where it's
more about the outcome of a
youth council. That is the
desire that I've heard up here
from everybody.
>> Any other counselor? Super.
>> Thank you. I am I don't
think this is the time or place
to debate how youth are
integrated in, whether they're
integrated into existing boards
and commissions, or if it's a
separate youth council. I am,
but I'm interested in seeing a
proposal more fully fleshed out.
Thank you.
>> Any more thoughts on the
Youth Coordinator portion of
this question? Right now? I'd
like to open it up for any
thoughts or comments on the
previous slides that were
discussing the overall themes
of the manager's budget.
Counselor Perez.
>> I just quickly on one of the
slides, it says, all things
equal, I'm trying to remember
what slide it was. Can you just
elaborate what that means?
>> Slide.
>> Assuming all things equal,
what.
>> So assuming all of our
assumptions for revenue, we
took our our forecast very
conservatively on the revenue
side. So without being overtly
aggressive on the revenue, I
would say so revenues always
kind of hard, especially on the
sales tax and other items. We
were very conservative on that.
>> So it's just all things
equal, like the same status quo.
Is that what it means? Yes.
Okay. Okay. All right.
>> All right. I'd like us to go
to slide 18. 18. Sorry. There
you go. Well, maybe it isn't 18
on this presentation. It's
about the parks budget. Maybe
go back one. Let's see where we
are.
>> They were kind of
interspersed through different
slides.
>> Well, so my question
revolves around, you know, the
there's a on one of the slides.
Maybe there it is. Yeah. Oh
it's 19. It's at 18. The deputy
director positions for Parks
and General Services has caught
my attention. And one of the
questions I have around that is
knowing that we've we
definitely cut back on parks
staff, park maintenance staff.
You know, in our last budget,
to the detriment it appears
from, you know, the comments
we've received from the general
public on parks maintenance and
just not having enough staff to,
to do all the things that need
to happen. I mean, closing
restrooms instead of cleaning
them and repairing them, you
know, isn't really a good
solution for parks. And so I'm
wondering how we're addressing
it by hiring a deputy director
instead of perhaps utilizing
that, that funding for more
staffing, or maybe there is a
staffing component that you're
not highlighting.
>> I can speak directly to the
position of the deputy director.
So these two departments are
the last two departments that
don't have a deputy director.
And with the size of the city,
it's good practice to have a
deputy director for the size
and the breadth of the position
in case of any leadership
issues, or we want to avoid any
points of failure because of
the importance of these
departments. And as far as the
service levels and the
regarding the Department, I'm
going to defer that question to
Dave Perlick. I don't know if
he's online. Oh, Dave. Dave's
here. Sorry, I didn't see you,
Dave. I know Dave worked out a
plan on this position
specifically.
>> Okay.
>> I would say my position was
exactly your position in the
last budget. You know, we
focused on deploying staff at
the level of ensuring we
maintain as many programs and
services as possible. I'm
strongly in favor of this
proposal and this budget cycle
only speaking for parks. The
reason being we need to have a
future as well as sustained
service levels. And ultimately,
we're talking about significant
work in our parks comprehensive
plan to align a proposal for
potential long term funding.
And we're also talking about
annexing up to 35 facilities
with Clark County. And we can't
I don't believe we can
adequately plan for the future
with our current staff
complement, focusing primarily
on deploying programs and
services that we offer today.
So I think that additional
management position would
primarily be focused on those
preparing us for for annexation,
growth and sustainable funding.
>> Are you proposing in this
budget cycle, additional
maintenance staff in.
>> Yes, you'll see a proposal
coming through public works
budget that would restore
seasonal temporary staff in
grounds maintenance. So there
would be some there are. And
and we're talking about an
additional position being moved
to deploy that position to
better support events and, and
activities in the downtown area
during the summer. So we're
trying to address some of those
major service impacts. I think
ultimately, we will continue to
one step up, maybe one step or
two step back as we move
forward without additional
dedicated funding. And so I
think we want to do both. We
want to manage our service
levels as well as possible and
current resources, but make
sure we're doing the work to
plan for the future as well.
>> Okay. Thanks for all of
those responses. Something to
think about. Any other comments
or questions on these previous
slides or any of the proposals
so far? All right. Oh we do.
Okay.
>> Mayor Pro tem, I, I
appreciate you bringing that up
and, and would love to see what
this position description
fleshed out. Thank you.
>> Would we be able to see the
position descriptions of all
these new positions being
proposed, just to better
understand how they align with
the work of the city, because
there's multiple new positions
being proposed with this budget.
Okay, councilor.
>> Just one more thought as we
talk about the organization of
the city, the staffing and such,
just wanting to consider how
top heavy we are with that
compared to staff that's out on
on the ground doing the work.
So I'm curious as to what that
level of work looks like with
the addition of these topper
topper top positions, such as
the deputy positions. Not to
say that they're not important,
but I want to get a better
picture of what we're adding
and where we may be top heavier
than others, and especially in
the different areas that we
talk about the departments.
>> Okay, we can do that.
>> Okay.
>> Okay. Let's move on. Thank
you.
>> Okay, so transitioning a
little bit here. We wanted to
provide the council with an
overview of some of the key
revenue items in the
recommended budget. And as you
know, we have a new combination
of public safety funding that
is helping support this
priority area. The public
safety sales tax is going to go
into effect next year, raising
about 5.6 million in 2027 and
7,000,000 in 2028. This is
planned to support 16 new
police positions, providing
ongoing operational support for
the real time Information
Center, as well as an increase
in support for public defense.
The related HB 2015 grant
funding is going to help
support some of these position
costs for a period of time as
well, and help fund one time
costs associated with
additional staff like equipment
and vehicles, as well as some
of the infrastructure costs
associated with that real time
information center. And as you
know, prop five revenues are
supporting those 13 police
positions. One city prosecutor
and a legal assistant. There
are also two revenue items that
we wanted to make sure to
highlight for council
discussion. The first of those
is the inclusion of revenues
from HB 2442, which is a 0.01%
local sales tax dedicated to
supporting children and family
services. The recommended
budget assumes some new revenue
from this potential sales tax,
but that new revenue starts in
2028. The plan is to come back
and discuss this further with
council during the year, to see
if that is something that you
all are interested in
implementing. The current
recommendation, assuming that
there is support, would be to
offset the current Justice
Center Children's Justice
Center expenses with that new
tax at about $1.7 million in
2028, that would leave about
$5.5 million in remaining
resources to be programed based
off of council direction. And
I'll go ahead and talk about
the second revenue item here
for council discussion, and
then pause there for for
discussion. So the other change
to highlight for council
discussion on revenue is the
change in the utility tax,
going from 28.9% to 28.99%.
This change is expected to
increase revenues by about
$210,000 per year. The city
manager is recommending to use
these resources to fund a 1.0
FTE that will help support the
Climate Action Framework and
generally help advance the
city's climate goals. So I will
pause there and see if there is
any council discussion on those
two items.
>> All right. Do we have any
thoughts that we'd like to
share at this point? Okay.
Council Member Stover.
>> Thank you. Mayor Pro Tem,
thank you for this discussion.
Talk to me. How about how
conservatively we're
forecasting this public safety
sales tax.
>> I would say that for 2027
fairly conservatively, we are
only counting on ten months of
revenue in 2027, knowing that
we have a kind of a two month
lag before those revenues are
to come in. So I think we're
feeling fairly confident about
about the revenue projections.
>> Are we putting in the
possibility of a recession into
those forecasts?
>> What I would say is that
right now, what we are looking
at is not the finalized city
manager's budget, right? So
we're not necessarily looking
at this from the perspective of
exactly what all this public
safety sales tax is going to
fund. Like it's not all
finalized. And definitely
something that we've been
talking about is making sure
that from an ongoing revenue
and ongoing perspective,
ongoing expense perspective,
that we're not kind of like
fully capping ourselves out in
year one, right? So we're not
looking at $7 million of, of
revenue in year one and taking
that all the way out in with
expenses.
>> Okay. So I live with the
anxiety that we are way past
due for an of a recession and
that inflation pressures are
not abating right now. And that
that's going to have it's we're
already seeing the effects of
that in consumer spending. So I
guess it's great that you're.
You've got this additional
capacity for other programing.
And I hope that this council or
future councils will not budget
that money out of forecasts,
but will wait until that money
is actually in the accounts
before any spending is proposed.
Because I just I don't trust
the economy. To rely on sales
tax. Thank you.
>> Councilor Schober. If I
could, I could address that a
little bit too, because one of
the things with the way that we
have put the budget together is
that we know that in future
years that the expenses of the
police officers that we hire
will catch up to the available
resources. So we focused on
anything in the early years
that would use kind of that
margin is all things like one
time expenses or capital
expenses, much like we did with
proposition two, where we used
the early years to fund
improvements to fire stations
and things like that. So that
gives us a buffer because in
the event that we don't see
those revenues materialize, we
can pull back on some of those
capital expenses to make sure
that we don't overextend
ourselves. And with the way
that we have things distributed,
it's not linear where
everything shows up in year one.
So if revenues don't
materialize or in your in your
sort of material, excuse me,
revenues don't materialize in
year one. Items that are that
are anticipated for year two.
Maybe some of those positions
just don't get created. We also
then built buffers into the way
that we are anticipating
positions to show up in future
years. Typically, in the past,
when we put something in, there
was an assumption made that
that new position would always
start on January 1st. And so it
was fully loaded for a full
year. And we have scaled those
back for nine months as well,
just to make sure that as we go
through some of these, we have
some lead time before some of
those decisions would actually
be implemented. It gives us the
ability to pull some of those
levers back. In the event the
economy turns down.
>> One other thing that I
wanted to share on that is that
we've heard that there's an
interest in council in more
regular updates on that, and so
we are intending to come back
periodically and provide
updates to the Council on sort
of the public safety, sales tax
and spending on that. So
hopefully we'll be back before
you too long before with an
update on that.
>> I'd like some clarification
on this particular slide. When
I read it the first time, I was
assuming that these are three
different taxes. Is that
correct? Yes. Okay. So this
House Bill two 4042 is an
additional 0.01 that we're
discussing. Okay.
>> And so if.
>> You said program for 2028 as
if it's already been accepted
and move forward.
>> Let me drill down on that
for you a little bit. So the
way that the city manager's
recommended budget looks like
right now is that there is a
small amount of revenue assumed
in 2028 associated with this
new sales tax. It's about $1.7
million. And it's offsetting
the Children's Justice Center
expenses. If that sales tax
were to move forward, there
would be an additional $5.5
million in capacity to be spent
at council direction. What I
was trying to to suggest
earlier is that part of the
plan would be to come back to
council and have that
conversation of, does that make
sense? Is there interest in
implementing that, that sales
tax? And if not, there would be
plenty of time to to address
that in the budget and shift
those resources elsewhere.
>> What I what jumps out at me
as is the idea of, of
offsetting the Children's
Justice Center costs with a
with this tax, the volatility
of, again, kind of going back
to a sales tax versus using our,
our budget that's been budgeted
for years as a staple stable
income or contribution to the
Children's Justice Center as
our contribution. The county
has a contribution. We have a
contribution. And I have been
part of discussions, budget
discussions with the Children's
Justice Center as the council's
representative for now, 2 or 3
years now, trying to remember.
But what they don't need to
hear is that we suddenly have
less funding to support. So
this seems to me as if we'd be
moving away from being a a
consistent and trusted partner
with a fund that suddenly drops
because of recession or other
reasons. And so I'm, I'm
concerned about this particular
proposal. If it was not
offsetting and it was saying
that we are actually providing
additional funds for other
capacity to the program that
I'm interested in hearing. Okay,
we have thoughts. Councilmember
Harless.
>> On this same conversation
about the sales tax. I'd like
to see that it could even be
used for this. You know,
reading what was passed by the
legislature, it looks like it's
more for assisting children
with child care, other support
services, after school
programing, workforce capacity
building, shelter and rental
assistance and transportation.
That doesn't ring children, you
know, supporting the children's
justice centers. It might not
even be. I'd like to see that
it actually can be used for
that, if that's even how we
even move forward.
>> Sure. We can get you an
analysis on that.
>> Okay.
>> All right.
>> I'm not in favor of. HB 2442
at this time, basically,
because the financial burden
already on our our residents
who are struggling to make ends
meet at this point, just to
meet their basic needs, in
particular, seniors and people
with disabilities and those who
live on a fixed income. And
there doesn't seem to be any
protections in place for this.
So at this point in time, given
all the other taxes being added,
not just here locally, I
believe that this is not for us
just to decide to add on
another tax at this point.
>> All right. So at this point,
just to ask council for, I
guess, a thumbs up if we have a
majority to even move forward
with staff bringing us back
more information on this or not,
because that's what staff's
looking for today. So maybe
just I'm going to look to this
side and see we have two three.
Okay. So we do have a majority
to bring back more information
on this particular item. But
you've heard some of the
concerns that have been raised
for sure. Let's talk about the
increase to the utility tax. Do
we have all the information we
need to ask staff to bring back
more information or or not?
>> I'd like.
>> I'd like more information.
>> I would like more
information, please.
>> All right. So we have a
majority of bring us back some
more information on the utility
tax counselors. Do we have some
more clarifying questions so
that staff knows what questions
and information they should be
bringing back? I have some
ideas myself, but go ahead,
Councilor Stober.
>> Thank you. Mayor Pro Tem.
Typically when we talk about
utility tax, there's a there
are graphs brought to us that
show where we stack up versus
our surrounding communities.
Around us, other target
communities. When it comes to
our utility rates. So
definitely want to understand
the impact of this within that
context.
>> Okay. Anything else? All
right. Let's move on to the
next slide.
>> All right. So in previous
work sessions, you all have
discussed some of the
strategies that city staff are
deploying to help manage the
structural operating deficit,
to kind of reexamine and shore
up our financial practices and,
and still really try to make
progress in council and
community priorities in the
coming biennium. We're going to
touch on several of these items
again before moving into a
forecast update. So you have
seen this table before. So I
won't go into each of these
items listed here. But these
actions taken in some represent
the city's efforts to really
analyze opportunities, both one
time and ongoing to direct the
funds that we have available to
us to their highest and best
use, to make sure our financial
planning is really grounded in
reality and to help solve the
budget gap that's before us.
That's been a common theme that
you heard throughout the spring,
and one that you're going to
hear going forward as well.
These are a series of
additional strategies that are
being employed during the 2728
budget development process.
What these strategies point to
is, is a holistic and really
cautious approach to the next
biennium. The city is
undertaking work to review our
legacy financial practices. As
Lon mentioned, for example,
that work is going to continue
going forward. It's ongoing.
We've got planned updates to
various cost recovery practices
and efforts underway to improve
our planning for future
equipment replacement, as Lisa
mentioned. Overarchingly, this
budget takes a disciplined
approach to approving new
budget requests and is really
asking departments to assess
their existing capacity and
demonstrate their needs before
new resources are approved. And
that, more than anything, has
led to an overall tightening of
department budgets in a very
intentional and strategic way.
Going into this biennium, we're
going to be working on improved
performance management and
budget monitoring going forward,
and to that end, we'll be doing
a year end review with
directors on their budgets to
look at trends, kind of trying
to see where are we
overspending in areas where we
underspending and discuss how
that's going to affect our
future planning going forward.
Our aim with all of this is to
preserve the capacity of the
general fund and to, as we're
looking forward, evaluate
multiple options to move work
forward, both from a funding
perspective and from an
operational perspective. We
certainly have more work to do.
The city is still facing an
operating deficit, but these
efforts have helped balance
this biennium budget and
improve the financial outlook
somewhat, as this approach kind
of ripples through the future
years of the forecast. And and
what I mean by that is that our
our efforts to bend down the
cost curve now are compounding
in the out years of the
forecast. But as you heard
earlier, we know that we might
see some revisions to those
expenses in the future as we
kind of further this analysis
and kind of shore up our
financial practices. So we know
that we'll see updates going
forward. So with that in mind,
I'll provide an update on where
things are at with the general
fund, Street fire forecast in
July and August. We shared with
you this slide showing a small
surplus in 2027. That's kind of
kind of quickly overcome by the
year over year impacts of the
city's structural operating
deficit. So you see that $5.5
million surplus kind of being
eaten away over time. And then
by 29 through 32, the total
value of that operating deficit
was estimated at a little over
$100 million. This forecast
slide has been updated to
reflect the city manager's
recommended recommended budget.
And so we're showing ongoing
revenues and ongoing
expenditures over the next six
years. And so we're kind of
shifting from this forecasted
assumptions. And as Lisa
mentioned, our forecasted
assumptions are very
conservative to what is
actually the budget system kind
of carried forward over time.
The updated chart shows that
the city is essentially
balanced in 27 and 28, with the
structural operating deficit
arising again, kind of in the
latter years of the forecast,
that total estimated deficit
across those years is just
about $62 million. So that you
can see, you know, compared to
the prior forecast update, that
that revenue picture really
hasn't changed much. The more
significant driver of the
change in the forecasted
deficit is the expense trend
line. And, you know, the kind
of the rationale there is that
all the changes that the city
has made to bend down that cost
curve from an ongoing
perspective, again, relative to
that conservative forecast, are
carried through each year at
the forecast. So those savings
compound year over year over
year. So we still have a
significant budget challenges
on the horizon and lots of work
to do on the strategies that we
have kind of laid out before us.
But the conservative approach
that we're taking for this 2728
recommended budget is really
kind of helping to ease the
outyear issues that we've got.
This next slide shows the same
forecast chart for the 2728
City Manager recommended budget,
but it also reflects the use of
about $13 million for one time
initiatives. And so you saw in
the strategy slides and heard
about in earlier conversations,
the various ways that the
budget achieves one time cost
savings over the biennium. And
this forecast slide shows the
application of one time
expenditures in general fund,
street and fire funds. These
expenditures won't won't carry
forward into the 2930 biennium,
but they do set us up to
advance really important
initiatives. We wanted to
highlight them for you. So this
table shows a list of some of
those one time initiatives that
are funded during the 2728
biennium, and this funding is
going to help advance work that
you've kind of already seen us
talk through in some ways. So
the installing solar at
Firstenburg, securing resources
at the arts hub for phase one
design and construction,
supporting continued work in
the comp plan and annexation
planning and ensuring that our
public safety departments have
the equipment that they need.
As we're kind of working
towards that improved approach
for equipment replacement over
the long term. So with that, I
think I'm going to turn it back
over to Lisa to talk about next
steps.
>> Does Council have any
questions on these forecasts?
>> Go ahead.
>> I have a question on slide
27 or 26. Keip going back one
more. One more, I believe.
There you go. Okay. Yeah, that
one. I appreciate the review of
legacy practices. I think
that's really important to to
do. I'm curious about the
department programmatic
capacity and how much of that
is administrative and how much
of that could be centralized as
opposed to each department
having its own administration.
So I was wondering if that was
something that would be looked
at in terms of legacy practices,
or have you considered that as
an option?
>> I think that's certainly
something to evaluate when I'm
sort of thinking about what
this bullet point means, where
my head goes is more of a
review of budget versus actuals
of each department and program
within a department has a
certain level of budget year
over year, and evaluating
whether or not that program is
actually utilizing the capacity
that they already have before
requesting additional resources.
Right. So kind of really making
sure that we're fully utilizing
the resources that are already
available to us before asking
for more resources and having
those programmatic and
performance conversations at
that level before seeing
whether or not we need to add
more resources to achieve the
same goal.
>> And my thought is about
duplication of programmatic
actions across departments that
could be reduced to a
centralized approach. So that
that's just where my thought
went with that, and something
that I'm hoping you will
consider as far as addressing
some savings in the future.
>> Thank you.
>> All right. Any other
questions? All right. I don't
see any other questions. Go
ahead.
>> Sorry.
>> Okay. We are going to go
over the timeline. We are fast
approaching the publishing of
the city manager's recommended
budget. We do have your
feedback. And so I think we
will provide that to you
probably in a memo format or
maybe through City Manager's
communication. Prior to that,
we are required to publish the
budget by law on October 1st.
We also have two upcoming
workshops, specifically on the
budget, the published budget.
The first one will be on
operating budget on October
12th, and then the capital
budget for October 26th, and
then presented for council
consent on November 2nd, and
then the public hearing and
adoption of the budget on
November 16th. So with that,
that closes the presentation
and opening it up for general
discussion from council or
feedback or any review of any
previous slides.
>> How is staff going to bring
forward the budget when we it
looks like there's a few
decisions on revenue side that
haven't. That Council hasn't
weighed in on.
>> Well, we could provide the
information through. I'm going
to look over to Lorne a little
bit here. Because of the
timeline, I think we could
provide that in a memo format.
And I think with the date, I
don't think there's any other
method to communicate because I
think there's the community
forum next week. Right?
>> Yeah. And normally when
we've had that had choices that
the City Council has to make,
we kind of model it two
different ways. What I would be
inclined to do is to make sure
that we give the council a list.
Like if you were to choose to
not move forward with an
adjustment to the utility tax,
this is what we would have to
remove from the budget so you
can see what the impact would
be. But to actually prepare the
budget as though those items
are included in there. And, you
know, I'll say that some of
those items, they'll be future
decision points for the city
Council. For example, if you do
decide that you want to adopt
the new children and family
sales tax, we don't have to do
that in December of 2026. That
could occur in 2027, leading up
to January 1st. So those types
of decisions, we can model them
in there. But because of the
supplemental process, we have
the ability to make adjustments
along the way. If you think
back to the discussions that we
had, we've had to do that in
the past when we've had voted
propositions out in front of
the public, where we have to
show what a budget could look
like if the proposition passes
and then end up adopting the
budget for what it looked like
when proposition five did not
pass or, excuse me, proposition
four did not pass.
>> Well, just given the level
of discussion that we had on
those revenue, new revenue
ideas, it. I would like to see
it very clearly shown within
whatever documents you share
with us in the coming week.
What what the effect of those
decisions look like on our
budget. So I think most council
would be in agreement with that.
I'm seeing some head nods. So
moving forward, as if it's not
a done deal yet would be my
preference. And then obviously
we ask for more information
around those pieces too. And so
staff is planning to provide us
those those materials before
our forum. Is that before next
Monday, or is this something
that you're thinking of getting
us before October, before the
budget is published October 1st.
So when are we getting those
materials? That's my question.
>> We can try and get to you in
a memo that Lorne can
distribute to you this Friday.
>> Okay.
>> All right. Do we have any
other questions or discussions?
Oh, on.
>> Not from my point of view. I
think we will endeavor to get
you the information that you
need, because we want you to
feel fully informed when you
make those decisions.
>> Okay? Yes.
>> Just a comment. I heard from
community who attended some of
the budget community meetings
that you put on and got really
good feedback. So just wanted
to share about it. Sounds like
it was a great success and was
curious if there were more
planned.
>> We don't have any more
planned for right now, but I
would not be adverse to doing
that, especially once we hit
the point where we do the have
the budget adopted and go out
and talk to the community about
what is actually included in
the budget. Because, as you say,
council still has some
decisions to make between now
and then. And while we've shown
the community some of the
highlights for what the draft
budget contains, some of those
may not make it through to the
final version.
>> Okay.
>> Thank you. All right. Looks
like that's everything. We
don't have any more questions.
Thank you, staff, for joining
us tonight. And that will be
the end of our workshop time
frame. We'll be back at 630
after a dinner break. Thank you
everyone.
>> Thank you. Thank you for
your feedback.