December 6, 2023 Council Finance Committee/Investment Review Committee

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[00:00:00] Chair Lisa Matichak: Welcome, everyone, to the Leaf Master Ebony Online. Yeah. Okay. Sorry, about that. Let's see, this is the council finance committee meeting. Yeah. Um, and this meeting is, like, a virtual component. And when the chair announces an item on which you wish to speak, if there are any members of the group or anybody else? Um, please raise your hand in Zoom or push Star 9 on your phone. And when the chair recognizes you to provide your comments with the unmute feature, in Zoom, or start 6 on your phone. And each speaker will have three minutes for comments. Is there anybody, is, are they the noops of the public online? No. Yep. Oh. Okay. Okay, so, um... we're gonna take a formal roll call? Sure. I'll committee

[00:00:55] Unknown Speaker: and make this from there. Sure. Maybe Emily Ramos,

[00:00:58] Member Emily Ann Ramos: here?

[00:00:59] Unknown Speaker: Sharing these without a chance?

[00:01:00] Unknown Speaker: Here.

[00:01:00] Chair Lisa Matichak: Thank you. So, everyone's here. The first item is, uh, on the agenda is the approval of the minutes from November 30th. Does any member of the committee have any comments or corrections right here? I did not have any. In either. And there's no members of the public here. Uh... virtually. Why don't you just let me know if somebody joins, so I don't have to keep on asking? Thank you. Um, okay, I didn't have any comments or corrections. The emotions? I moved.. Okay, Ian, can we, do I have the roll collar green, do you raise hands? Really nice. Okay. All in paper? Unanimous. Thank you. Fly

[00:01:47] Unknown Speaker: into this meeting. Wait up. Not quite. Okay,

[00:01:55] Chair Lisa Matichak: the next item is oral communications, and this portion of the meeting is reserved for anyone who wishes to address the committee on items not on the agenda. But there are no members of the public here in person. no online. So he will just close that item and move to the next. Which is the economic forecast report. And we have a special guest. If you want to introduce yourself, tell us a little bit about yourself, and then we'll jump into the presentation. Okay, great.

[00:02:23] John Havenman: My name is John Havenman. I'm the executive director of Need, the National Economic Education Delegation, news nonprofit that's trying to get economists out into the wild, telling people what we know about important policy issues, like inequality, housing, climate change, federal debts, issues like that, whereas 750 members, Strong, including Jenna Yellen and Ben Bernanke. Um, I have been a Bay Area economist for about 20 years, well, I guess, 22 years now, studying the Bay Area economy. We worked first for the public policies to California, chief economist of the Bay Area Council, and I've been an independent consultant for the last 10 years. Anything else I can tell you that you'd like to know? I didn't

[00:03:07] Chair Lisa Matichak: realize you were just a Bay Area economist. Um,

[00:03:10] John Havenman: well, like, I'm a national economist as well. I've been focusing on the Bay Area economy for the last... 22 years. Awesome. Okay,

[00:03:21] Unknown Speaker: so just maybe a little bit of background. We have engaged John and, um, Bob Isler from Sonoma State University. He kind of just, I think it's appropriate every once in a while to check in with the outside, third party economist. Tell us, you know, about the national economy, the state economy, and then also anything specific to the local economy. And so, we'll use this information as we move forward for our mid year budget update, and for the 24 25 budget. This will help kind of inform some of the information we provide to the council. as well as, you know, help with Kimbra's kind of, overall guidance as well as for developing the budget. So that's kind of the reasoning behind this. I don't think this committee has ever received a report like this before, but, um, hoping that we can have this on a, you know, somewhat regular basis going forward. That's kind of the... Sounds good. Yeah, great. So I'll turn

[00:04:16] John Havenman: it over to Dr. Hayman. Okay. So I'll speak relatively briefly. I'll talk a little bit about the U.S. economy briefly about California. down to what we see going on locally. And so, in terms of the U.S. economy. GDP is almost back to where I would have expected it to be. Friends up there. The red line is my 2019 forecast of GDP, and we're just about there. GDP growth in the third quarter of this year was 5.2%, which is really, really fast. Has a lot of people work. I decided to raise interest rates in response to that, but I don't think so. So GDP, the economy's doing well. About a year and a half ago, the New York Times started crying uncle a little bit about recession. And I've maintained that, no, we're not going to have a session. We're gonna get out of this inflationary period without having a recession. Well, we seem to be manufacturing relatively soft landing. Soft landing, primarily it comes because the pump was well primed. Right? I mean, this stimulus, the $5 trillion that we put into the economy, a little bit of a double edged sword, right? A lot of spending, drove a little bit of the inflation, but it has allowed consumers to keep going during the period when the Fed has raised interest rates and is trying to slow down the economy. And so the consumer contributed about half of that 5.2% correct. Next slide. I like to point this out to people, because we have a lot of cranky people in this country about the economy. But the United States economy, so this is the deviation from the International Monetary Fund, this is the deviation from their 2019 forecast for where we would be today. The U.S. is over there on the left, and it's a little bit positive, so we're doing better than

[00:05:53] Unknown Speaker: where they will forecast four years ago that we would be. And

[00:05:56] John Havenman: everybody else is doing worse. Literally everybody else. Right? So, um, we weathered the pandemic pretty well, Derek last night. In terms of employment, we still do have an employment gap, if you get it forward, we're about 5.1 million below where I would have expected us to be, still 4.5 million above, where we were before the pandemic, next side. Inflation, right? This seems to be on everybody's mind. It is coming down. It is at about 3.2%. That's the headline inflation number. The core inflation number is running a little bit hotter at 4.4%, largely because of housing. The difference between the headline and the core is we take fuel, and we take food out of the core. Those two both have very volatile prices. But the housing, the CPI, housing and rental index, is still running at about 6%. And housing exhibits significant proportion of people spending. So that's being, you know, a drag, if you will, on the inflation rate coming down. But it's a real lagging indicator, right? The 6% that we see is not reflective of the fact that asking rents are way down, and that, you know, throughout the Bay Area, we see that home prices are way down from there as well. Well, let's turn them out in view a little bit. So this is Mountain View employment going back through 2010. You can see, the pandemic, there is obvious. The recovery from the pandemic and the blue bars, pretty sharp and striking. Very good. until about a year or so ago. When the technology sector, which had really hired into the pandemic, has decided, well, we did too much of that. So they are now hiring, now, firing out of the pandemic. So most of the drop that you see is from the tech sector. So employment is trending down. I do expect that to change. You know, it's also turning down because a lot of the employment in the tech sector is now elsewhere. Lots of telecommuting. I do think over the long term, that's probably gonna change. We're not gonna get back to where we were before the pandemic started. But I think we'll be closer to there than where we are now. In Mountain View. I think it's about 25% of the labor force that is telecommuting. In California, it's about 17%, and for over the US, it's about 15%. And I see more companies saying, why don't you come into the office three days instead of two? And so I think that that trend is gonna do. continue. I also think that a lot of young workers are going to start understanding that it would be good to be in the office, right, to have contact with those who are going to hand out assignments so that you get the good ones. So it may take a while, but I think the telecommuting will diminish any importance relative to today. Part of the reason for the decline in employment is do the decline in the labor force. There are labor force, mountain views down significantly relative to pandemic numbers. A lot of this in Mountain View, a lot of this is early retirements. It's also movements out of people, to the extent that they are in Mountain View and the lower part of the income distribution. So part of the key to getting the economy, Mountain View, Bay Area, California, US, going, again, growing faster is to get the labor force to grow. Still, a lot of people who are sitting on the sidelines, because they're afraid of COVID, or because they're suffering from... Inside there. So this is tech employment. We don't have tech employment for Mountain View specifically, but for Santa Clara County. The line on the bottom there, so you can see the vertical line over on the right hand side, that's when the pandemic started. And you can see tech hiring into the pandemic, employment and tech went up, until it went down. And then in the first quarter of this year, we're starting to see a leveling off and an increase in Santa Clara County. relative today. Population growth, Mountain View maintained its population pretty well, relative to Santa Clara County, relative to California, lots of migration from Santa Clara County, which is a concern for Mountain View, because before the pandemic, about 50% of those employed in Mountain View, came into Mountain View from outside of Mountain View. The population outside of Mountain View, in the broader counties, is in decline, that may make it harder to employment levels. But population, just a little bit of a decline between 2022 and 2023, but nothing to really talk about. Next up. So this is the population forecast for Santa Clara County. This is from the California Department of Finance. It's pretty dismal. It's forecasting for, you know, the next few years population to continue to decline. followed by a period of significant growth, but that will be a drag on local economies for the next few years. Here's

[00:11:01] Chair Lisa Matichak: this forecast.

[00:11:02] John Havenman: This forecast, it starts in 2020. So they made the... This is from... about eight months ago. So it's recent. I think

[00:11:14] Emily (staff): it goes through, like, 2060 or something. Yeah, it goes out of 2016. Uh,

[00:11:19] John Havenman: in per capita income? That's good news for Mountain View. If I was here last year, I would have told you that Mountain Dew's view was in third place nationally. You've jumped up over Newport Beach, so Mountain View has the second highest level of per capita income nationwide. Second only to Palo Alto. Wow. And per capita income growth, next slide, Derek. Has, in fact, been growing quite nicely over the course of the last 10 years in Mountain View. I have not found data that can help me explain. So the mountain view is the navy blue line up there, the one on top on the left hand side. I have not found data that tells me why it dropped so much between 2022 and 2023. This is the American Community Survey. Mountain View is a relatively small city, so it might be a small sample size, and it might just be an artifact of the data, and if I come back in a year or a couple of years, We might well see that that little bit down is gone. But the trend over the course of the last five, 10 years is for progressive income to be growing faster in Mountain View than Santa Clara County, California, or the United States. In terms of permitting, um, you know, last few years, uh, Mountain View has been a little bit slow. So on the left hand side, that's permitting in Mountain View, Santa Clara County, the Bay Area, California, the United States. It is all divided by population, so I think it's per 1000 in population. So we can compare them and put them on the same graph. But the last year, permitting was down. Over the course of the last five years, the trend has also been down in terms of permitting in... You know, not a lot of growth in very many places. Uh, you know, California, uh, and the Bay Area, have an uptick, uh, United States is permitting as a whole, is permitting at a much, uh, much faster than anywhere in California, uh, which not entirely surprising. So, that's more or less what I have for you. I know you've got a busy agenda, so I've tried to keep it a little brief, but happy to tell you the questions you want. To sum up, you know, the most forecasts that I've seen of Mountain View's future, you know, specifically the next five to six years are pretty favorable, very positive. Revenue streams, the forecasts that we have are all pretty positive. The only little hiccup in terms of transient occupancy tax. Expected to be high this year, drop a little bit next year, but then grow from there. Residential permitting, maybe a little bit of a drag on growth, to the extent that you'd like to grow the population to grow the employment base. Permitting would certainly be helpful there. Very highly educated population, very well paid population. Um, you know, net population flows, a little bit of a decline, and not decline, but it's leveling off the last couple of years, gonna be very interesting to see what happens in the next couple of years. Reliance, again, as I mentioned, on the Broader County for workers, might be a little bit of a drag on fountain view growth for the next few years until things start turning around in Santa Clara County. Probably should have checked San Mateo County as well, but I

[00:14:25] Unknown Speaker: think the forecast is recently similar to Santa Clara.

[00:14:27] John Havenman: You know, tech employment, I expect tech employment to bounce back. A lot of it, as I mentioned, the decline is telecommuting and shedding excess hiring during the pandemic. Um, but, you know, tech in this area has been hit so many times, I mean, it always seems to bounce back, largely because if you really want to be successful in tech, all of the resources to be successful are here. And so I expect tech to continue to turn back around and be a real source of girls in the region. Oh,

[00:15:00] Chair Lisa Matichak: I was so fascinating. In the meeting. Are there any questions? Or comments? I have

[00:15:08] Unknown Speaker: a few questions, and I'll concede that, uh, we had a pretty heavy agenda last night, so I didn't I wasn't able to go through all of the material as as thoroughly as I would like. Um, but I, um, thinking about the implications of a pretty soft office market. Yeah. I have very little appreciation for the history. Have we seen vacancies at this level? What are your projections for the office market, and then how should we, how should that influence our thinking about the upcoming budget cycle? Yeah,

[00:15:43] John Havenman: I don't, you know, I think that office vacancies currently are at a very, very high rate. Historically, I do expect things to start turning around from here, though. Right? I believe that things have bottom down. As I mentioned, I think that the telecommuting is gonna start waning a little bit, and telecommuting has really been the source of the high vacancy rates in office space. So, my expectation, right? I wouldn't want to build right now, necessarily. let the market turn around and recover somewhat, 'cause it's gonna take time. Vacancy race, I think, will be high. But I expect them to go down slowly every year from here. You

[00:16:23] Unknown Speaker: seen commercial rents come down, or do people still have... One of the challenges that we have in Mountain Views. A lot of property owners have very high expectations that they don't want to deviate from, even when there's a softer economy. So they hold on, and they hold on, and we see maintenancies persist for a while. Yeah,

[00:16:39] John Havenman: to be honest, I don't know about locally. But I know in San Francisco, and I know in the North Bay that rents are coming down. They are. Okay.

[00:16:47] Unknown Speaker: And then, I'm not sure I'm gonna be able to formulate this question very well, but one thing I'm starting to appreciate is, a lot of many jurisdictions locally have perhaps over reliance on enormous development, like Cupertino and the Apple spaceship. We're starting to see how that's biting them pretty badly. Um, you know, uh, Google and San Jose, San Jose bent over backwards to accommodate Google, and maybe it's not paying off. Um, I'd be curious to hear your perspective on how my influence, how we approach development, where we benefited from big projects. We may not see those types of projects occur anymore, and so maybe we need to rethink our approach to commercial development, especially. Um,

[00:17:38] John Havenman: no, that's a really good question. And for me, not easy to answer. Um, you know, I, I, I, the, the big apoplex and the Google Plex. Right? Those things are enormous. And I would have spoken in favor of diversification. Um, you know, because as goes Apple or as goes Google, so goes the local economy. So, you know, I would speak a little bit more in favor of smaller projects. I mean, if another, if Mountain View were the location of choice for another big one, like? I would, uh, I would worry a little bit. Okay, um, I wish there were more time to delve into that. Well, I can make myself available if you want to talk more. Are we hiring?

[00:18:28] Arn: That would just echo, though, that revenue diversification is always a healthier. Yeah, mix. And you mentioned Apple, Apple, it was their dependence on the sales tax. They had an agreement with Apple that the state then looked at, and basically said it's not legal. And we always talk about our second largest revenue stream being our leases, which is unusual. Their largest revenue stream was sales tax, which is unusual. Um, I... Hold

[00:18:55] John Havenman: off. You can get my contact information from Derek. Happy to talk more. Yeah, Do you have any questions? So, um, we

[00:19:06] Chair Lisa Matichak: talked a little bit about the tech sector, but what about other sectors? Mm hmm. Especially, like, biotech, although that's still tech. What's your thoughts on... on growth? Of other sectors. Yeah,

[00:19:21] John Havenman: um, so biotech specifically? I don't have a good answer for you. My expectation is that in the Bay Area, generally. biotech, which I think has fallen off a bit during the pandemic, is that biotech will grow back again. will

[00:19:38] Chair Lisa Matichak: be a force for growth in the region. Any other sectors you think we should keep our eye on? Um,

[00:19:44] John Havenman: you know, the sectors that I worry the most about are not sort of the headline sectors. I mean leisure and hospitality. Continue to worry about that. Employment is still down throughout most of the Bay Area relative to before the pandemic. And it's gonna struggle to come back, because we lost an enormous number of people who staff the industry. I mean, that's gonna be a difficult part, difficult source of difficulty for the Bay Area economy. Thank you. One

[00:20:13] Member Lucas Ramirez: last question that just came to mind. So, I'm thinking about the fundamentals are strong. Yeah. Um, uh, nationwide, the weaknesses are political. We seem to insist on self inflicted wounds, especially at the national level. So I'd be curious to hear your, you know, what advice would you give to a jurisdiction that, um, to protect ourselves or hedge our bets when probably the greatest threat is our own government, and its desire to destroy everything. Wow.

[00:20:44] Chair Lisa Matichak: Pessimistic. That's

[00:20:49] John Havenman: not unrealistic these days. Uh, boy, um... You know, work regionally. All right, I mean, engage with the Bay Area Council. Um, figure out how the region can... Mountain View, on its own, can't very well insulate itself from what's coming. But working together with broader Silicon Valley, with the broader Bay area. The broader Bay Area can probably work to insulate itself. Like, I guess that would be my advice, right? Work and play well with others.

[00:21:29] Member Lucas Ramirez: Maybe question for staff, um, thank you for doing this. This is very valuable, and, you know, when I have some time, I'll actually go through the reported more, um, and more depth, but I'm curious how, um, this work is influencing staffs, preliminary thoughts about the upcoming budget, anything that we should know, and... thinking about the

[00:21:52] Derek: work that we're gonna do in the future. I think we're still digesting a lot of it, as far as, you know, how what the messaging will be come mid year. So I think we'll have more information then. I don't know, if there's anything else, really, that the top level, I think, is strong locally, but we are seeing, you know, especially with just no turnover in the housing, so that's causing us some heartburn with the, you know, transfer tax. We're not seeing a lot of that, which is not a huge revenue source force, but it is, you know, a fair amount, so we gotta keep an eye on that. And I think just as we go along, and we start recommending mid year budget amendments, we come up with our five year forecast, we're gonna just use some of this data, um, to kind of inform some of that. So, nothing specifically, unless you... Just

[00:22:36] Arn: to what the director is saying. A lot of this, just validated what we're seeing. You know, for instance, last year when Grace and Eric, we're building the budget. They estimated a 15% drop off and business license tax, just 'cause we started seeing war notices. Here we are, a year later, and we're seeing that we're already at, like, 14%. So that was a good assumption that was made, and it has come to fruition. You know, you've heard us say that property transfers, and this has been confirmed by the county assessor in his latest annual report. I mean, screeching to a halt. So the conveyance tax, down by 50%. You know, you, I, in particular, I found the permitting data really interesting, that slide, you know, we talk a lot about our development here, and relative to the nation. It's been flat, and if you look at the last quarter, it's dropped off significantly, and probably data out there, that belongs to validate and confirm that, you know, as we start building the budget in the next year. So... Yeah, I... Like that, I love this stuff. Thank you.

[00:23:38] Member Lucas Ramirez: It's interesting. We often see entitlements, right? And we know, there's a lot of volume that comes to that point, and then after that, the council doesn't usually have a lot of insight, and so that was a startling number for me. Well, you know, I'm used to a high number of settlements, like, are going through the planning process. They're just not actually instructing. And I'd be curious to understand historically what that looks like. You

[00:24:05] Arn: know, and your other question was actually in the transmitter last year. What's gonna happen in the commercial space. There was an article the other day, CMBS, the rollovers that are gonna happen in the next year, and it kind of coincides with what the doctor was saying. The largest section is commercial office, but then hotel and hospitality has a big chunk of CMBS that's gonna roll off, too, and they're either gonna be able to absorb higher rates, or they're not. Which means you'll start having defaults. And then you started having fire sales, like we saw some in San Francisco, you know, properties that were valued at 300 million, trading at 70. I don't

[00:24:43] Member Emily Ann Ramos: remember how San Jose was. Jose, just recently, did a portion of the Fairmont in downtown San Jose. It's now student housing. Right. It's not. We're not filling the hotels. Good. Interesting. Thank you

[00:24:58] Chair Lisa Matichak: very much. I appreciate it. My pleasure. Thank you. Thank you. Um... You'll nurse the public, so we don't have public comment. Okay. Thank you. Bye bye. Thank you. Thank you. Thank you. Um, okay. Um... That was just a, uh, information. Yes. Such an item. Move on to 6.2. Which is the end and his auto results, and we'll do a system here, 22, play train, and you're talking about... Um... We'll start with the presentation. Introduction. Yeah, so real quick. Yeah, yeah, I'll

[00:25:38] Derek: just, I'll kick it off real quick. So, this is our annual, you know, as you know, we have an annual audit every year, financial statement audit that's done by a third party CPA firm. Um, this year was MGO, and, um, so we have Scott Bume here today. to present audit results, and also to convey some required communications that's required to be communicated to governing bodies. So, um, he'll be happy to answer any questions you may have about this. Very exciting, annual financial report. So I think I'll, uh, headed off to Scott. Thanks,

[00:26:16] Scott Bume: Derek. Um... So, I'm Scott D. the engagement partner is here for the financial audits, and that encompasses both the city Acford and the shoreline regional community audit reports. And then there's a 2nd file that was provided, I believe, which is the report to the city council for the required communication, so the governing body, and the oddity in this case. It's also called the Sasman 14 letter. And that's basically the summary of auto results. for what we went over. So I'm mostly gonna be referring to that document as we go. Before I go into that, I'm just going to cover a couple things on the audit opinion itself for the Oxford and the Park Report. And just one. an unmodified opinion, news up front, which is it's the highest level opinion we can give on the accuracy of the financial statements, um, in there. One other note on it, it's just, um, in terms of what's new this year, in the odd opinion, there's an emphasis of matter paragraph, um, that you'll find when you look into it, discussing the implementation of a new accounting standard, which is Gasby 96, for subscription based IT arrangements, for this year, that's kind of the new standard that's hitting everyone, for this year. And, um... In this case, for the city, it's not a huge financial statement impact for this year, not anything close to the links in the center, gas, but 87 from the prior year. Um, but it's very similar to the leases. It just kind of a more focused version of that. specifically impacting subscription-based IT arrangements. So, um, for the sections that follow the opinion and the report, the management discussion and analysis, um, that's management's opportunity to communicate the activities during the year, and, um, it includes some reviews of the financial statements, explanations of changes, and so on. That area is not part of what we audit. We don't give an opinion on that, but we look at it as part of our review process of the report to make sure it's consistent with the areas that we did audit. So it's, um, it falls under desk over our financial statement for you. And then in terms of the notes, to the financial statements for this year, there's not a whole lot new to bring up. The main thing is, um, if you go onto the, um, statements of accounting policies and procedures, the 1st footnote in their, um, well, it's known 1J, if anyone wants to reference the report itself, but that covers new Gasby pronouncements that are issued during the current year. It's, like we mentioned earlier. Yes, I mean, 96 is the new one for this year. So it highlights new pronouncements that take effect during the current year and whether or not they impact the city and then it highlights upcoming ones that are going to be considered in future years. So it's a useful roadmap for new stuff coming down the road, impacting financial reporting. So, with that, going back to the, um... This has 114 letter, the summary of auditors results. One thing I wanted to touch on before going into the content of it itself is just regarding internal control. So, um, we don't give a formal opinion on internal control as part of the audits. We evaluate internal control as part of our risk assessment process, sort of the financial audit itself. Basically, for the purpose of driving the nature and extent of the procedures we're gonna do to evaluate the financial statements. So we look at internal control, see, with that scope. But if, in the course of reviewing internal control, if we identify findings, deficiencies, things like that, then that'll be communicated as part of this letter that we provide. And if you look at the letter, you won't find anything like that in here. So it's a clean audit, is done to clarify. There will be an opinion letter that accompanies the federal compliance audit later on the single audit when that gets released, and that will basically summarize what I just said, that we don't give an opinion on the effectiveness of internal control, but that we consider it as part of the audit, and that it's a clean report for this year, for the financial audit. Outside of that, for the required communications, just a few things that it highlights, it goes over responsibilities of the auditor, independence, and so on. It talks about changes in accounting policies. Again, Yasmi 96 is highlighted as part of that. It goes over accounting estimates. So, um, areas where estimates are needed as part of the financial statements that includes areas like capital asset depreciation, and then cases where actuarial valuations are needed for pension and notepad liabilities and things like that. So it covers, um, these, how the estimates are developed at a high level and then what we do to evaluate them also. And it's discussed in the letter. And, um, beyond that, it goes over, um, if anything significant came up during the audit, any issues, significant audit adjustments, um, disagreements with management, if there were any, in this case, none. So, there's really nothing to report on that area. It's just, it's part of the letter. So, um, beyond that, I don't really have anything else to bring up on the letter itself. I'm happy to answer any questions, and when there's anything to bring up. Any questions from powers?

[00:31:50] Member Lucas Ramirez: So, first, for my benefit, the single audit is an annual audit, or if you

[00:31:56] Derek: spend over, is it, 750, or a million, in federal awards, if you spend over. Right. Then you're your subject to it. Which we... Yeah, well

[00:32:05] Member Lucas Ramirez: over. Um, I remember, um, so, you know, we have this, um, uh, CFC meeting annually to... I think we have a, what is it, we are obligated to have two hearings for the annual comprehensive financial court, which is great. But we don't have that requirement for the single lot. When does this go before the council? What did we last when we do? I'm trying... I had questions, maybe it was two years ago, or last year, about the use of, and the tracking and recording of the, um, uh, American rescue Play Act funds. And, uh, I think the answer was, that's all, you'll see them in the single audit. I just don't remember when we looked. Yeah, do we bring that to council? in January,

[00:32:54] Derek: February, by March? I'm

[00:32:56] Grace: usually in prison, March. So, because at least the quality report, the special requirement is not, because our council policy be five, I would say, in some, we have other things policy for council, it's only specific for the annual compensive, but doing for single order, it's not single order is requires only when we receive better funding. We

[00:33:19] Derek: don't have a specific requirement in the city. No city policy to bring that to the council, sounds like.

[00:33:24] Unknown Speaker: There's no federal requirement to have a public hearing or for the council to approve

[00:33:28] Derek: it. There's not for the act for either. Um, I think that's more of our internal, could be part of our, part of our charter, um, might say that we need to bring it to council. So there's some discussion. I don't know. Scott, if you want to chime in, or if you have any more information about, I think every city's technically a little bit different on when and how they bring it to the council. I don't think that there's a formal formal requirement. Most cities do, just because it's the right thing to do. Right. But unless it's in the charter, I don't think there's a formal requirement. I know there's been some discussion about, is it really required to be brought to council or not? We do it, most cities do it. Single audit, sounds like historically, we don't. I know at, yeah, my past place, we did bring it, and we can do that. Definitely do that. It's not a problem to bring it if the committee would like that. Well,

[00:34:16] Unknown Speaker: I don't want to create work. But I do feel like as a transparency. If you value transparency, there is some value in bringing it, at least to the CFC. Um, I would have been interested to review it, especially in light of the substantial amount of federal funding that we've received as part of our... Yeah, and it's not completed yet, so we've got time.

[00:34:39] Unknown Speaker: We got time. Well, I'd be interested.

[00:34:41] Unknown Speaker: If I might add, I think one of the, we've never been bothered to the council policies because of the council of CFC is because of single order is due March 31st, and after it's due December 31st, so we... This is third, yeah. If we bring it to CFC, you could be either in the, because it usually means annually for CFC. So maybe the timing, but we could definitely bring it to the council for transparency, that's time. It

[00:35:05] Unknown Speaker: really doesn't require a lot of work for me.

[00:35:08] Unknown Speaker: If you make a consent item, I guess.

[00:35:10] Unknown Speaker: Yeah, I think that would be valuable, personally. I'd

[00:35:12] Emily (staff): be welcome, Mike, Mike. I have the same experience, Derek has. It's typically a consent item. February or March.

[00:35:19] Unknown Speaker: So as soon as it's done, sometimes we're riding right up against that March deadline, so that could be why, too, but, you know, couldn't be a problem. And

[00:35:28] Unknown Speaker: especially if it doesn't require council approval. Even just, like, a informational memo, you know, by the way, we submitted the single audit, here it is, anything that might be noteworthy for us to... Sure.

[00:35:40] Unknown Speaker: I don't appreciate or be aware of. Yeah, just in that regard. We are potentially planning to have another CFC meeting in February. So we might, uh, that might be a good time to do it. Yeah. We're thinking about doing that here. Yeah,

[00:35:51] Unknown Speaker: You never really looked at it. Yeah, it'd be helpful to have an understanding of that

[00:35:54] Emily (staff): document. The ad hoc revenue committee would probably like that. Yeah, I bet. That'd be right, you wired. Oh, yeah, there you go.

[00:36:05] Unknown Speaker: A lot of other questions, but I don't want to dominate. That's okay. You know what? Sorry. Um, so, I'll bring up sort of my my usual observations and, um, requests. I think one of the things I... The most valuable aspect of the act for, in my opinion, is tracking fund balances versus activity, um, to see if, if, you know, they make sense. I still don't really understand. We talked about this in the briefing that we had a few weeks ago. was the equipment replacement maintenance fund. Memory serves, it's bounced back up to $30 million. And I couldn't quite remember. Did we actually, has the transaction occurred for the new fire engines? Did that take, did we spend that, whatever, $7 million? It

[00:36:55] Unknown Speaker: just doesn't have a...

[00:36:56] Unknown Speaker: Yeah. So I'm curious about how that was, that was a big expenditure, and already that, that reserve, the balance has, seems to have jumped up pretty quickly. And I still don't fully understand how the activity justifies that reserve. That justifies the balance, I mean. Are

[00:37:18] Unknown Speaker: you, uh, are you referring to the balance from in here? Did you see that? That's the first thing I look for. Every three years. The transaction for the fire engines? Did that occur after June 30th, though, Grace, do you know? That's interesting. It was. Okay, so it is. So, I think what we're gonna do, because the last time we brought this up, I think we'll get you some detailed information on the equipment replacement fund. Just, we have a list, obviously, of everything in there, and how that, the replacement, cadence works, to show you how things are properly funded. Um, and so you can maybe get some eyes on that, if you'd like. That might be helpful. Just to see how it correlates. And, you know, we're always up for, uh, improvements on any ideas. That ERF is a hot topic. It's a big thing to track, so we're trying to look for things, ways to just kind of improve the efficiency of it. And so I think maybe, um, by sharing some of that information might be helpful for some feedback, too. So I think that would be the, you know, I think that we feel it's probably an adequate balance without, um, you know, digging into it too much, but I think we should take a second look at it. And with your eyes, too, that may be able to provide some input. And maybe we bring it back in February or something like that, you know? Have it as an item to discuss. Which

[00:38:33] Unknown Speaker: I would appreciate. The primary concern is that we might be overcharging departments, right? And especially if we're starting to look at lean times, do we need to overcharge to keep this, um, the, the fund balance, as enormous as it is, right? Especially if the activity over the past 15 years has been, with one exception of that, the fire engine transaction, is pretty low. And I know that's not the auditor's responsibility to really track that. But I, I, that's the, I feel like there's a lot of value in understanding activity versus the reserve balances.

[00:39:11] Emily (staff): And just for the committee's awareness, as he is currently, starting to Shepherd, a cost allocation, and fee study process, and they will start looking at some of the cost allocation methodologies that are being utilized. in the city, so that'll be another kind of form of review. Okay,

[00:39:29] Unknown Speaker: cool. Thank you. And then, um, the other one that I've always been interested in, it was... historically, I've collected a lot of fees from development. And those get lost very easily, and there isn't, if you were to search, you know, through the act for to try and track that, you're not gonna be able to do so very easily. And I'd be curious to understand, is there a way that, how do we, you know, if you're looking back to make sure that, you know, the fees were collected in the fence, the way that they should have been? What do other jurisdictions do? And then how do we keep trying to develop these, which are, you know, really nice to have, and it's nice that we collect so many of them, but really hard to look back and say, you know, yes, we've used them the way that they were intended to be. Yeah. Those

[00:40:18] Unknown Speaker: are tracked in our development services fund, which is part of the general fund, correct? Yes. Yes. Yeah. So it's part of the general, which you're right. You don't, it's not split out in the ak fur. So I think probably just the best way, and we're experiencing some issues with that recently, because some of the development has slowed down. Yeah, we still have costs associated with projects that are already started. And so I think maybe if we give you a separate report on that, once we kind of finalize some things, we're looking into it as well, just kind of the mechanics of it. But I think we can provide just a financial statement from our system that shows historically, or as of today, our revenues and expenditures. You know, it is part of the general fund, so it's included in their transaction testing that the auditors do, but there's no special focus or anything on the development services fund. I don't know Grace... I would

[00:41:11] Unknown Speaker: add a development service fund, is what budget classified as a major fund. We went out and reported separately on the media report and on the adopted budget and recommended budget. Documents weapon.

[00:41:22] Unknown Speaker: So we'll see it again in February, too. So you do

[00:41:24] Unknown Speaker: get an update from us, specifically for development service. Great,

[00:41:28] Unknown Speaker: thank you. Um, and the last thing is, I, you know, I've been, um, monitoring, but, you know, been on the CFC for a little while and monitoring the council for for a number of years, and we always have clean audits. So kudos to you for putting this together, unmodified every year forever, you know, and not every jurisdiction can say that, so you're all doing a great job. No,

[00:41:54] Unknown Speaker: I don't have any questions. It's a lot of information. I'm absorbing. I'm

[00:41:58] Chair Lisa Matichak: absorbing. Um, I also didn't have any questions, and there's still no members of the public. Um, so are there any other comments? You

[00:42:08] Unknown Speaker: mean a budget and brief later? Can we do the act for and brief?

[00:42:12] Unknown Speaker: We actually are. Yes. Really? And it works, yeah. So, it's called a popular annual financial report paffer. Oh, cool. Cool. Yeah. So this will be our first year. We're gonna go for the, uh, what they call it, the Triple Crown, which is all three awards. So, yeah. So we haven't really announced that yet, but I'm happy to say that at front of you guys. Well, thank you. Yeah, yeah. Now, that's... that you bring it up. So, yes, yeah. So we've already started, actually, on that, so it's due coming up. Okay,

[00:42:37] Chair Lisa Matichak: then I'll say my one little bit. Okay, okay. It is. And then there are some things that are really hot buttons for me, and one is the use of the word citizen. And it's in the act for. Oh,

[00:42:49] Unknown Speaker: okay. Interesting.

[00:42:50] Chair Lisa Matichak: It should be resident, yeah. visitors. There you go. Community, something. Okay. Yeah. Do I?

[00:42:56] Unknown Speaker: I will do a search. Search. Yeah. Yeah, Helen, Helen. There was only one. Okay, that's interesting. I wonder where it was... Yeah, interested in the seat.. Oh, okay. Wow.

[00:43:07] Unknown Speaker: Geez, nothing gets past Lisa. That's good, though. No, we don't use. Yeah, we usually don't use that term, so... Yeah, but,

[00:43:13] Chair Lisa Matichak: yeah. Yeah, because you didn't. In other places, which is great, on the orc chart, residents. Yeah, yeah, yeah. Finally, we have residence. And saying, you know, right there at the top, which is terrific. But that's one of my little... Yeah. That the boots. But I didn't have any other comments. I'm happy to hear that there'll be one in brief. That's cool. That's cool. Yes. Because I did read the budget infantry. Um, and it's... Okay, so, let's see. Do we take a road on this one, 'cause we're recommending it to the council? If you could just...

[00:43:54] Emily (staff): I think Johnson and Cindy Pondo that aren't said hi. I would recommend approval? Sure. I guess. We're with Buckam... Yeah, so... I don't

[00:44:03] Unknown Speaker: remember the technical accidents. Second? What? Second. Thank you. Review

[00:44:07] Unknown Speaker: and discuss modern results and recommend to the city council's steps. Thank you. Um,

[00:44:13] Chair Lisa Matichak: I'll invite you. This is unanimously. Thank you. Yeah, thank you very much. Even though I think I've been on the CFC every year of my term here. It's always interesting. Mm hmm. When's something new every time? Something that's like, you guys, always know requires. Yeah. So, yeah, great. Okay. Next is item 6.3. And it is... those changes to council policy ATE, which is the authorization. And is... Is someone doing a staff report or...? Uh,

[00:44:54] Unknown Speaker: I mean, uh, so, staff report? To us?

[00:44:57] Chair Lisa Matichak: Uh, do we just... Presentation? Presentation, sorry. We

[00:45:01] Unknown Speaker: didn't really have a formal one. We're just gonna... Between city attorney's office in FASDI. We were gonna go walk you through it. But no formal presentation. And then if you have, I know people have, probably, comments, and some suggestions were open to all the feedback. I think this, this policy update has been a long time coming, and so, you know, I think, and this agenda, in general, is a big one, so I really appreciate the committee being able to look at everything, and you've had time to look at most of it, or all of it. So, but we... So, we'll start off with A10, and it's time. Uh, A10, which is our, um, authorization to execute city contracts and agreements, and to increase, uh, certain appropriation. And so, you were, there's two parts of A 10, as you know, there's the policy itself, and then there's the exhibit A, which kind of has, like, a cheat, call it a cheat sheet, which has the details by type. Um, where... have also presented a comparison table, which I hope found helpful, um, as an attachment, as well. We did some research of some local and similar cities. Um, recommending, uh, they increased to 250,000, uh, up for city managers approval, and then, above that, we'll go to council. And so, I think if we just want to walk through it, um, with any changes, or if you have any questions, maybe, we could start there, hopefully. Yeah. Yeah. And

[00:46:30] Emily (staff): I'll just add, from the city manager's perspective, you know, there's always the balance between, how do you create efficiencies while maintaining appropriate financial structures and processes in place to make sure we're maintaining appropriate controls. This is low hanging fruit, in the sense that you just heard, you mention clean audits all the time. They do procedure checks, control checks. This is a way to try to help free up some of that capacity that we always talk about is in short supply. in the sense that a lot of these that would normally go to council on a consent item requiring staff work to do reports, would no longer necessarily need to go with higher authorities. Once again, as long as you're maintaining appropriate control. Hey, any questions? I've been loud. Oh, they're almost. Um,

[00:47:27] Unknown Speaker: so, uh, one of the things I'm curious about, I really appreciate the chart that we have at, like, we are a little... a bit lower than... not all of them, but, like, a lot of them. How often does this get updated? I feel like this is, like, something that, or, like, when was this last updated for us? And, like, how often should we plan to update every year? 'Cause I think things just get expensive over time. Yeah, so...

[00:47:55] Unknown Speaker: we took the survey. If you're referring to the survey, we took the survey just recently of all the cities. in the last few months. Oh, policy. Oh, the policy itself. The policy itself has been, I want to say, oh... 2010 was the last time. Yeah, it shows the last time. Substantial

[00:48:11] Unknown Speaker: update to them. The amounts was 2010.

[00:48:15] Unknown Speaker: We've had other small, well, things added and clarified here and there. But the amounts... Yeah,

[00:48:22] Unknown Speaker: and I think originally, just speaking freely, I think a back, there was attention for there to be, it needs to be indexed and upgraded every year based on an inflator, but I don't think the wording, and I don't think it was probably done correctly at that time. And so we have built in a CPI, um, increase around it, I think, to the nearest thousand that will help. So we don't really find ourselves in this sort of big change at once, you know, big increase all at once in the future. I think that will definitely help. This is what you would typically see, I think, at other cities, at other cities I've been. We had a CPI like this. I know the city attorney's office helped a lot on this and provide a lot of input, too. So to try to make sure we don't find ourselves in a similar situation down the road. So, hopefully, that answers your question. It's been about 13 years since we've significant changes, especially with the amounts. Oh.

[00:49:20] Unknown Speaker: Any any questions? That was the only question I had.

[00:49:23] Unknown Speaker: I have, uh, questions sort of along those lines. I'm, um... just as a as a practical matter, right? So there's, uh, the... We're not talking about... When you have an escalator, right? Like, CPI increase that's built in. How does that information get distributed, right? We're not gonna update this document necessarily every year, so you're not gonna see odd numbers, right? It'll be 250,000 asterisk, right, index to, you know, whatever, uh, and then with some base year, I guess. Well, that number's gonna change, and it will be always communicated, you know, across the organization easily. How do we... This is a dumb question. How do we track that and make sure that people are using the correct threshold?

[00:50:19] Unknown Speaker: No, that's a great question. So we planned on, I think we picked April for the CPI, so we'll have time before July to communicate citywide with the, we'll calculate it in FASDI and purchasing. We'll calculate it and send it out, citywide, to everybody, including a council, obviously, to be aware of what the new limits are. And so, I found that that's the most helpful, you know, and then way to do it at other places, but we also, on our internet, you know, the internal, will have our update our chi chi with our guidelines, as well. So people can always turn to that. But hoping, and I think that would be the appropriate course of action. And we do trainings, yeah, just real quick. We do trainings. FASD offers trainings every year on purchasing, refreshers. All of that will be reiterated during those trainings, too.

[00:51:09] Unknown Speaker: That's consistent with how we handle the city's minimum wage updates to CPI. Basically, figure gets calculated, they do an internal staff report to all the departments, saying, Going forward, based on council policy, this is the new minimum wage. Right.

[00:51:24] Unknown Speaker: I guess the... I don't want to be too much of a cynic. So I'm thinking, you know, in that case, if someone doesn't get paid minimum wage, There is an enforcement mechanism that's pretty clear. The accountability is very clear. If someone ducks a transaction that maybe, you know, different, right? Or... they didn't calculate the CPI correctly or something, right? It's maybe a modest number off. Where's the accountability? Who tracks that, who makes sure that, you know, oh, this really should have been at this level of authority, you weren't really authorized to make that transaction. Who's tracking that, and then who's holding folks accountable if there is? So the contracting process?

[00:52:13] Unknown Speaker: Exactly. Yeah, yeah, yeah. You're basically looking at all of them. In a sense that, you know, and as our purchasing manager, we have our assistant finance director, our finance director. At the end of the day, uni code, they own financial controls in the city, which then, it's up to your city manager, who is also responsible for ensuring that those financial controls are in place and happening. So, two things. One, part of what goes into an unmodified opinion and everything else is that we have sufficient financial controls in our finance department. The other part is, a lot of this was driven as a city manager priority. And so, from that perspective, every year, we're gonna be waiting to make sure that the update happened, because it just ensures, one that the policy's been followed, and two, that were adequately providing breathing room to our department to make the contracting process more efficient. And real

[00:53:13] Unknown Speaker: quick, I'd just like to add that, so every, pretty much every agreement, every purchase requisition, goes fast, the agreements, a double check by city attorney's office, if we're looking at, if I see something for, you know, $275,000, we're looking to counsel approve it. Okay. So, that's just, like, an automatic, and there's certain procedures in our financial system that routes it a specific way, depending on the dollar amount, too. So, you know, once we'll be updating those every year. So, I have, I'm fairly, very happy that we would be catching that. I mean, we do that now.

[00:53:48] Unknown Speaker: Yeah, I'm not too worried about the controls. Um, I have a procurement card in my day job, and, you know... A lot of attention to that, but people... genely misuse. Is there anything you wanna share? Yeah. I mean, this is, this is a, a, a propos of nothing, but there was a, uh, there was an article in, uh, an online newspaper that talked about this, right? And my name is there, and it's, you know, to the far right, 'cause I spent zero dollars over the past several years. I just don't use it. But people do misuse it, and it makes me wonder about, you know, internal controls and that kind of thing. And, you know, who's checking?

[00:54:25] Unknown Speaker: It's totally appropriate. I mean, you're not only fiduciaries in this specific role as committee members for the finances of this city, but you're also fiduciary, in general, as council members. So it's totally appropriate that you probe. And I will say next year, when the auditor's here, feel free to probe. That's what we do when the city manager does the onboarding interview. One of the first questions we ask, I wasn't here this year, but in Los Galos, one of the first questions we ask is, Have you seen anything we should be concerned about?

[00:54:54] Unknown Speaker: Wow, okay. Um, so thank you. That's helpful. The last question I have is, so I trust the controls. I think that's I'm not too worried about that. I am curious, though, in... there might be... It's pretty rare, but sometimes the council will have an interest in a contract and ask questions, and, you know, we do lose a little bit of authority in this as council. And I think there's great trust in the city manager and its staff. But I, nevertheless, it would be helpful, maybe, to track some of these procurement, the contracts that are authorized, and then report back to the council, maybe not as formally as a consent item, but just to help us understand, like, what, you know, it's been a long time, since we've increased the authority, you know, what is being done with that additional authority, just, just to give us, an understanding of the types of decisions that are made now that there is a reasonable. So is that an easy thing to report back, or is that something that would be burdensome?

[00:56:02] Unknown Speaker: Yeah, if we wanted to do a report out a year from now?

[00:56:04] Unknown Speaker: We can run an report and give that to counsel, or how we would like to see that. Um, we do, actually, um, sometimes there are contracts that even they may not need to go to council, but council has interest. Uh, we will take that to council. And the example is the janitorial contract. So, anything that's, maybe, political, or, you know, needs, counsel, input, or we would like your input, and we want to bring that to, you know, main counsel. Please, look at this. That's something that staff will take to cancel. And at any time the council is interested in any, any type of contract, you know, we can always ask us and we can get that in relation to.

[00:56:49] Unknown Speaker: I don't think it needs to go to council, but I'd be interested in, like, a informational? Yeah, a year from now, you know, what what does this look like in practice? You know, what are we no longer seen at the council level that, you know, now you have authority to proceed with?

[00:57:05] Unknown Speaker: Similar to the current process. If you start having sequential amendments that start to take the threshold above the 250, you'll see that at council. You know, that's the initial number, but through the years, you know, if you start adding on additional services or doing amendments, once it breaches 250, then it requires approval.

[00:57:24] Unknown Speaker: Um, questions now or...? Yes. I bet.

[00:57:29] Chair Lisa Matichak: Thank you. I'm here, John. Um, so, actually, the question, um, Luke was asked about, um, or, no, you said, asked the auditor about, Did you see anything concerns about? Would that have been in the letter?

[00:57:45] Unknown Speaker: The fact that we got an unmodified letter, they saw nothing they were concerned about. Okay. I was just emphasizing, you know, the fact that there are no bad questions in your role as fiduciary.

[00:57:55] Chair Lisa Matichak: Okay, okay. But in this case, it should have been in the letter. Oh, yeah. or anything. Okay. I thought, What did he do?

[00:58:02] Unknown Speaker: The opposite of an unmodified opinion is material weaknesses. Yeah. Oh. You start to see those. You should ask a lot of questions. Yes, absolutely.

[00:58:10] Chair Lisa Matichak: Um, so, um, I appreciated the survey of the other cities in terms of the, um, authority. What I was also looking for on Hugo was how they interpret multi year contracts. Do you have information on that?

[00:58:29] Unknown Speaker: And, you know, when we surveyed, when...

[00:58:33] Unknown Speaker: They're all different. So, um, we we can promote them.

[00:58:39] Chair Lisa Matichak: Yeah, I'd be interested in saying that. And I guess, um... When I read the... that part about multi year contracts... I really raised some questions for me, and I guess, you know, am I interpreting this correctly, that it says, um... Someone with a signature authority of up to $250,000 would sign, say, a five year contract, and what do you find them, and they counts, and commit the city to that, and the council wouldn't know. Is that how that's interpreted?

[00:59:18] Unknown Speaker: So great question. I think that that is potential that that could occur, correct? Unless it's project based. Right, great, if we talked about this. Yeah, go ahead, great. Yeah.

[00:59:28] Grace (staff): So, um, currently in a curp passing. What we interpret is, it is a lot of our contract, of our contract, for the CIP. Those are those are project bases. Those we don't look at them and your bases, we look at it as a whole contract, as in general. It's over $100,000 with current threshold, they need to go to council. A lot of the time, the exception here, we look at it by annual basis, is really ongoing routine operating contracts. We don't have a lot of those, to be honest, I can think of some. The one that come to my mind could be just the recreation, and you know, contract with the instructor, you know, we might engage the instructor to teach a recreation class for years. The annual payment to the instructor might be like 80,000 and then maybe 2 years contract is 160. Um, That's where usually we, you know, we look at that by annual basis because it's a routine ongoing contract. You know, they could be, you know, each year, they have, they hide the same consultant, all the same services. So those are the ones that our current practice, but we, to be honest, we don't have a lot of those, mainly a lot of time when we look at those contracts, we look at this day, we need to look at them and say, this is a project basis or it's really a routine ongoing that we receive the same service every year periodically.

[01:00:55] Chair Lisa Matichak: So we already do this, but we didn't have a policy saying we're doing this. Excellent purpose.

[01:01:01] Unknown Speaker: That's the current.

[01:01:03] Chair Lisa Matichak: Well, no, it wasn't in the policy, but it sounds like we're already doing that.

[01:01:07] Unknown Speaker: I'm not clarifying that. And then, the other that, right? Sorry, is what I said, right? Yes. So to to clarify. Also, when we have those, we, we actually don't encumber the funds for multiple years, we will only encumber an issue a purchase order for that particular year. And then once counsel appropriates, funds for the next year, we will then encumber it for the following year. So funds have to be encumbered before we can actually issue the purchase order. And we have contract language that says that if counsel does not appropriate for subsequent years for that contract, it will not.

[01:01:48] Unknown Speaker: We try one more example. So, earlier, we talked about, you know, Gadsby and software as a service. So let's

[01:01:54] Chair Lisa Matichak: say... Exactly what I was thinking.

[01:01:55] Unknown Speaker: So let's say the utility billing system coming, we bring out a firm, and we know that we're gonna have, you know, a software as a service component, and let's call it 300,000 a year, so we're over the 250. We're gonna sign a contract for five years. How would that be handled through this policy?

[01:02:13] Unknown Speaker: So we would award the contract to, but we would only issue the PO and the contract language would have to have that budget appropriation, and cancel cancellation language included, that we can cancel within our 10 day area. The other one is double the appropriation that we would not encumber funds for that contract unless council appropriates the funds for the subsequent.

[01:02:42] Unknown Speaker: And then let's do the inverse. It's $200,000. So now it's within the 250 threshold, but we know we're signing it for five years, so a million dollars.

[01:02:51] Unknown Speaker: Same language, okay? Yeah, do we? Always not the same language. Just real quick, I'm looking to staff... Yeah, would that necessarily go to council if it was the 200? Mm hmm. It's a multi year.

[01:03:02] Unknown Speaker: It would not. And, like, the budget? Usually there's, like, a whole slew of miscellaneous expenditures proposed. Would we see it there? It would never be made transparent to the council at all.

[01:03:13] Unknown Speaker: It is a long time contract. Yeah, yeah. And I do want to reiterate that... we know this is not happening very often. I think it's just something that needs to be clarified. We add it, because that's been a practice on a very minimal basis, but I think we need to clarify if that's, if we want to do it on an annual base, like, on a total per contract amount, which I think is probably appropriate in what we see in other city I'm from. I think we should do that in the wording.

[01:03:42] Unknown Speaker: And I think it's an easy... You just say, the dollar, multi year contracts or agreements, the dollar amount per year, for the life of the contractor agreements is used to determine the applicable threshold. Then it would be a cumulative effect, which is, I think, where you're going.

[01:04:00] Chair Lisa Matichak: Yeah, I would prefer to see if a contract expands multiple years is more than, if we go 250, that this council may see it.

[01:04:10] Unknown Speaker: The total over the years, it's more.

[01:04:12] Chair Lisa Matichak: The total sum of the contract. So it might be $50,000 a year, but it's for multiple years, and it eventually hits 250.

[01:04:21] Unknown Speaker: Who's the director? Good yeah. Yeah. Okay. Yeah. No, I think that makes sense. Okay. That makes sense to clarify that. Now, I do think, just keep in mind, you know, will there be a... I don't want to say workaround, but will there be a way to just have, if requirements wanted to do, uh, an amount for $125,000, you know, every year, they could do an annual agreement. They went.

[01:04:47] Unknown Speaker: So, for instance, what comes to my mind is the legislative obvious that we have. Typically, under the current threshold, an amendment or two are gonna take them over, which you may or may not see, depending on the outcome of this conversation. They're typically an annual renewal. You know, when they were first brought to the council, it was understood when you saw it, that, you know, it's gonna be an annual renewal of X amount of dollars.

[01:05:13] Unknown Speaker: When we're doing amendments to contracts, though, we take into account the total amount. So if they're amending it. If the problem would create itself is if you're doing a new agreement every year.

[01:05:23] Unknown Speaker: I'm sorry, it's just the same thing. Even if you're at $125,000 in year one, and then you want to renew the next year and year two for $125,000. And you want to renew a year three for $125,000. It's the same thing that you're allowing here. You're not doing anything different. By year three, you're over $250,000 with the very same person. I think it's about the contract, right? It's like, when you are going to, or this is a decision that you have to make, so that we're clear, and I'm asking for clarity, because I've been asked how to interpret this policy. So I want to know what the body wants, because I don't see it as any different. 125 now, 125. It's the same contractor. It seems like if you were talking about the same contractor, once you hit 250, council might want to know that you're using the same person, year after year after year, this very same person is, you know, in five years, gonna get $5,000 from the city. What if they don't like that contract? They'll never know that we're contracting with someone that they don't really prefer us not to. They'd rather us do another informal bid or find somebody else. That's the concern is it doesn't come out. So I think... It's fine if you want to do that, but I just don't see a difference if you can do it year after year after year, rather than a multi year contract. And

[01:06:51] Emily (staff): actually, is it okay if you follow that thread? What is your experience, Ben? You know, Eric and I and folks in our finance realm know what our experience is, but I'm curious. Once

[01:07:01] Unknown Speaker: you hit... it's by the... it's by the contractor. Once you hit 200 and whatever the max is, with that particular contractor, you vote a council for the same service. Okay, yeah, that's what... For the same service. That's bad. Okay, for the same service. If you have... And then, if, and if there's a break in between, right, if you have a contract in 2020 and you don't contract with them again until 2023, that also starts it over, right? It's not this continuous, it's really to prevent the continuous flow of money to one contractor without counsel ever knowing that many, many, many, many years, the same person has gotten the same amount of money. Ten

[01:07:47] Emily (staff): years went by. We never did an RFP. Right. Right, right. Right. Yeah.

[01:07:51] Unknown Speaker: I mean, right. The typical language is three years plus additional one year. Two, one year, renewals. So the current language does have the note. The current policy amounts pertain to annual proper rating budgets, with the exception of capital improvement projects, which are on a project life basis. So

[01:08:14] Unknown Speaker: we do have that. That is a correct practice. We do have the language sake that we do that in any of the... Hearing the... concerns

[01:08:24] Emily (staff): and the contemplation of our council members, they're, you know, confassy and CAO, kind of work off language, I mean, offline to come up with language. Yeah,

[01:08:36] Chair Lisa Matichak: so, um, what kind of... Because I don't know if we'll be able to word smith

[01:08:38] Emily (staff): it here now. Yeah. I don't think we would,

[01:08:40] Chair Lisa Matichak: but, um, we're kind of in the question section at the moment. Okay. And then let's get to, what do we want? Yeah, yeah. Um, 'cause I have some other questions. Okay, so, let's see, an attachment, and I'm sorry, this is gonna be a challenge, because we changed the attachment numbers. The attachment, six, the original, 10 foot six, which, I believe, is an A. Is that right? Red line version of the... Yeah, and I was looking... I always looked into the red line version, sorry. Yeah. Um, I didn't quite understand it, under two and three, in the over 250,000. It says, CM formal bid, CM, or formal bid. So, what's the difference between those? So

[01:09:33] Unknown Speaker: far least. Number three, it does say or formal bid. I don't know, Anne, do you have some background on that one? Number three. So,

[01:09:40] Unknown Speaker: typically, the city manager signs for, um... formal band. For number two, which is, uh, other construction is maintenance types of projects, not, um, construction projects, I think. So these are ones that facilities will initially be different, um, depends on types of projects. So, is this saying the city

[01:10:08] Chair Lisa Matichak: manager signs the formal bid? Is that how I interpret

[01:10:11] Unknown Speaker: that? Right. That's currently the practice.

[01:10:14] Chair Lisa Matichak: So then what is CM or formal bid? Yeah, number three, do you see number three? It does say or. All right.

[01:10:24] Unknown Speaker: So, I think that one is also still, um, city manager on one sign, um, whether it's a formal lawyer or... Or

[01:10:32] Unknown Speaker: maybe the or should not be there, it sounds like. Yeah. I don't know how... It was... It would have got in. Yeah, how that would have got in there. Okay.

[01:10:42] Chair Lisa Matichak: Yeah. Um, and then under four. I wasn't sure, and maybe, uh, it's just 'cause I'm looking at the red one. I thought this was the list of positions that were authorized to sign, and yet, I don't see that in that... It's all about... Sure,

[01:11:05] Unknown Speaker: I might be able to shed some light on your question. Yeah. So, uh, we actually, we conferred on this after this was uploaded, we realized that we had crossed some wires, because this was a late clarification request that we got, and we did some homework, and we figured out what went wrong. So Row 4 should actually do two different things. First, is that it should refer to council policy H1 for the acquisition of real property, because that is actually where the 110% appraisal value comes from. And it should designate the city manager, which is also in policy age one. What Roe 4 was intended to do was to provide clarity that for acquisitions that require a relocation agreement by operation of the law, which some of our acquisitions do. That included in that authority is the ability to execute the location agreement. And that's what row 4 is intended to cover. It is not intended to cover the actual acquisition of real property. Hmm. Okay. Um,

[01:12:11] Chair Lisa Matichak: so... okay. So we'll talk about how we change it.

[01:12:16] Unknown Speaker: So, yes. Yes. Okay.

[01:12:18] Chair Lisa Matichak: And then, um... An attachment, also an attachment, six. In the definition section. That now, if I get this several days ago, definitions. Um, category three. It says, um... category 7 and 10. And I thought, maybe that's supposed to be not falling into category seven and 10. Right,

[01:13:06] Unknown Speaker: that should be falling under or into it, I will defer to. Okay. I thought, not follow them. Yeah,

[01:13:12] Unknown Speaker: probably following is not the right word. It's your big fault. Falling into, I think, is what? Okay. Yeah. Um,

[01:13:23] Chair Lisa Matichak: and then, uh, category 12... Um, I, I think it's going to be other intergovernmental agreements, not included in categories, right? Correct. And you changed everything? Yeah, it's a category, yes. Correct. And, um... I was looking at a difference... on houses and the same attachment. The footnotes. The asterisk and the cause. Thank you, the same footnote, or unless I'm missing something. This thing seems a little bit different. Yeah, it's pretty different. Yeah. So we

[01:14:24] Unknown Speaker: can collapse. I think we'll collapse that, and we'll just double check to make sure, but, yeah. Okay. collapse that. Okay. Um,

[01:14:31] Chair Lisa Matichak: okay, if there's no more questions. And there's... You have questions? I,

[01:14:38] Unknown Speaker: um... I think part of the... I wrote notes and really didn't construct questions about them. I did want to better understand competitive bidding. That was one of my concerns, is, like, I'm okay with the authority increase. Am Bras here? Um, you know, but I think it's more better understanding the controls and making sure... The authority is okay with me as long as we are using competitive bidding and, you know, the controls associated with procurement, and that the transactions are made transparent to the council or to the public in some way. And I'm having trouble formulating the question about that, but just better, maybe it would be helpful to sort of walk through how, for multi year contracts, for instance, the council would be made aware, or how we... Do you elevate those in the budget, when we start encumbering funds, or how do we know? You know, when you are initiating a contract that, you know, might need to be approved by the council, but might be of interest for us to understand?

[01:15:51] Unknown Speaker: I mean, so, just off the top of my head, I think, going forward, once, if there are any changes to this policy, what we could do is, for the first year or two, or however long, do a report that shows, from kind of, any contract, or agreements entered into, from the old threshold, in between the old threshold and the new threshold, so you could see we could do that on a six month basis, on an annual basis, to show what contracts we entered into, that are, you know, from the... $100,000 to $250,000 limit that you may not have, may not see anymore that you might have seen previously. So we could do a report annual report, or a six month report. I think that would help for that. As Anne met that said earlier, um, there are certain ones that may not reach the threshold, but we still bring, just because we know in the past, council has been interested in those, and, you know, I don't know if there's new interests in other ones, we would be welcomed... if there's anything specifically. It

[01:16:49] Emily (staff): may be similar to before we do a couple of scenarios. So, an example, well, I'm doing our piece. that's just in government DNA. We almost always tend to run a competitive process. On a very limited basis, you'll have what they refer to as a sole source contract. It never requires approval by the city attorney's office. I'm pretty sure, right? Okay. No, it loves Godos. I did. Sorry. Sorry. But city manager. Yeah. Yeah. But typically, sole source contracts are very limited in nature. So, uh, the meeting we're gonna have after this. Upholster, we knew their contract would be under $100,000. We knew it would fall within the current purview of the city manager being to sign off on it. We still go to purchasing. We run an RFP competitive process. We go through that process. We vet candidates, we have an evaluation team that does the scoring. And if the check in balance on the whole process, her and her team, you know, and then once they are convinced that we ran a clean, competitive process. The evaluation score. determine who the award of contract we wanted to go to. Once again, we have to work with the purchasing team, to say we're ready to do the award of contract. Is it a go? And once we get the go, then we start to engage in the contracting process. So there's an example where totally within the current authority, yet purchasing process is still the purchasing process, the competitive process is still the competitive process. You will hear later, we are actually gonna have a subcontractor within that contract. Same thing. We asked the person we're contracting with, we give us names, three names. We interviewed all three. Actually, the city manager participated in those interviews, 'cause this is an important project. City manager also participated in the previous interviews. Go through, even though it's not an RFP. We went through a competitive process. We evaluated the three firms that we met with, and ultimately shows who we thought would be the right pairing of a strategy firm, polling firm. Oh, the competitive process. It's just government DNA. Right. Yeah, it's

[01:19:03] Unknown Speaker: not always the case, though, right? And I would say, generally speaking, you know, my comfort with higher authority, um... It exists when there is a competitive bidding process or an RFB or something. I might have less comfort with greater authority if we, you know, we don't have to go through a competitive process, but it would be helpful to understand why, in that case, we didn't, right? There might be some emergency authority necessary under some set of criteria, but I just, it's not really defined in this policy. Maybe that's okay. Maybe it exists somewhere else. I just haven't read through that policy. It would be helpful to understand that. It

[01:19:42] Unknown Speaker: may help, and please tell me if I'm sharing something you already know, what the code does set forth when bidding is required. So, there's a section here that says, if every project involving expenditure, public money is of more than $15,000, appropriately indexed, requires bidding, and then it sets forth when it's formal bidding, and what that means, and sets forth what's informal bidding, and what that means. If it's below the 15,000 threshold, what, above 5,000, and then there's something else below that. So, actually, that is in the code. Good, okay. Yeah, so it's in the Municode. So that's not something we could get around even if we wanted to, not even by policy, right? Because a policy can't override code. Right. So you are very much protected in the requirements for bidding, and that's what our purchasing... Right. Right. They would enforce that, ensure that all of the bidding requirements were met before the contract was approved. So that part is covered by your immune

[01:20:42] Unknown Speaker: code. Okay. Good to know, and I... You see that? I done my homework. I

[01:20:46] Unknown Speaker: wanted to add that, we also have administrative instructions, writing books through how exactly what the process should be. So we make sure that, they follow that, and then I also want to add that to, you know, postpone our events on online, and those are available for anyone to look at any time, and any vendors that are interested in doing business with us, they can certainly, you know, they can register with the city linked from our website. And if they will let us know, you know, these are the services we provide, and we match up the marching category code, and when it is posted, they will get automatic notification that, hey, this is posted, we love competition, better for us, and, um, some of them there. That's

[01:21:33] Unknown Speaker: helpful. I guess it's not, it's not really pertinent for this item right now, but in thinking about the contracts that happen over the past few years, a lot of them tend to be, uh, continuing with the same contractor or firm tanner comes up a lot, and a lot of our, uh, consent items, and then, um, I remember, um, Margaret Netto, you know, we tend to contract with the same people, and I vote, yes, all the time, but I don't understand, like, at what point do we trigger an RFP? It hasn't always been clear to me. And maybe that's on me. Um, so that's why, like, I get comfortable with the authority. But I just want to understand, I need to do some homework, to understand when a competitive bid is required, and when we can sort of just safely advance, but the firm that we've been using. So I'll stop there. Thank you.

[01:22:28] Chair Lisa Matichak: Okay, so, um... So no members of the public here? Kimber

[01:22:34] Unknown Speaker: joined us, and Kimber's on, yeah. Hey, Kimber.

[01:22:37] Chair Lisa Matichak: Um, hello. So, um, let's get back to... So I think what we can discuss is changes to the policy. and vote on that because that needs to go to council. But then there are other things that I don't think fall into being part of the policy that we also would like to, um, request, I guess. So, when it comes to actual policy, um, I guess I'm gonna start. I feel comfortable now with the 250. But I would prefer to change the multi year contract, so that, uh, the council has... that... you know, and I don't know the exact words to use, so, you know, trust you to craft those for the policy, but it's not the annual amount of a multi year contract. It's the total value, contract. And it's also the continuation of... contracting with that same entity, over and over and over, when that hits a certain 250. So if it's 50,000 a year, for five years, and then we... Or, no, I'm sorry, if it's... a contract for $50,000, one year, then the next year, then the next year, and you have separate contracts... But you're fine. Yes. You would want to see it again? Yes, yes. That's what you were...

[01:24:04] Unknown Speaker: Yes. That's what I'm familiar with. It's called contract splitting. So you can easily contract split by doing it one year at a time. incrementally getting to that. So what you're wanting is to not allow for contract splitting over one year periods, so that you can easily exceed the $250,000. Right. Right. How do you two feel about that?

[01:24:28] Unknown Speaker: Quick question. So, if we do a continuation, and... So, say we have 50K, each year, we hit the fifth year, and then, after that, we want to do it at the next... If we do continue, they bring it to council, and council's like, That's fine. Do we hit it again in another five years? When we hit that, too, limit again? Or is it, like, does it get...

[01:24:51] Unknown Speaker: We're following that 250 threshold. Is it reset, or does it...

[01:24:57] Unknown Speaker: The fact that it's gonna come back to council, I think the way the staff report is written, solved that issue. I can say, We want to re up this agreement for two years, three years, five years, and then counsel would have the ability to say, We're okay with that or we're not. It would have to be in the recommendation language, what the anticipated new term is, and what that would mean from a fiscal perspective. I think you'd be covered in the sense that if we have language here that says we have to come back to council, then the staff report that comes to council will explain what the parameters are and what we're looking for.

[01:25:32] Unknown Speaker: I'm not sure I understand. So in that case... Let's say the recommendation is one year, an additional $50,000, that year elapses, right? And you want to continue the contract, you come back to council. We would come back to counsel. We would come back to, okay?

[01:25:47] Unknown Speaker: So, um... Chair, check, may I be? Yes, absolutely. Okay, so I have a good example of this. Sorry, I'm hearing myself echo. No, I'm not. Um, So, great example of this, is the, um, Harry Black contract. So, Terry has done our executive recruitments for us and uh, we've had a lot of retirements happened in the past, you know, a couple years. And Terry, we have exceeded my $100,000 authority and we have gone to council. We will get council's blessing, essentially, on going over that authority. Now, cumulatively, it, you know, it has been more than a 100 and certainly using her, um, would seem like, um, It's well beyond that, but that's essentially because we've had so many executive recruitments and retirements. So, I mean, the way that I think you can look at it is whether it's 100 or 150 or 250. We would still follow the same, um, transparency with counsel, and I think it's a great idea to produce for you all, either every 6 months or every year, just a list of the contracts, so you can see them. I, I, I think that, um, shouldn't be a problem at all to do that. And then it'll, it'll give you all some greater insight as to. There's, and there's just so many contracts. You'd probably be so surprised at how many aware of putting through. Um, and do you know how many contracts are maybe Jennifer Matesh? I mean, just that the city does every year. I can't even. I can't even think there's just so many...

[01:27:37] Unknown Speaker: I just sent that report to my page the other day. Was it about 600 close to 600? Oh, my God.

[01:27:42] Unknown Speaker: Yeah. And those are more like our contracts, professionals, services, and other contracts, not counting on the purchase order side. Right.

[01:27:55] Unknown Speaker: So I think we can make this routine is what I'm saying. We can make this transparency and information to council routine about the kind of contracts. that I'm signing or whatever it is in terms of over 250 or however you want to do it.

[01:28:14] Unknown Speaker: And Anne did say that the system is capable of producing a report, so we can definitely do what you're suggesting.

[01:28:21] Chair Lisa Matichak: So I guess I want to get back to the question of when does it come to council? I guess I'm not clear. Like, the, um, in Oakland that you saw this? Object splitting? Yeah, is she against it? It was prohibited.

[01:28:35] Unknown Speaker: So contract splitting was prohibited there. You don't have to do that. So you could have, you know... It kind of depends on... I can understand if you have a multi year, it would be clear to me that if you said, even if it's a multi year contract, right? It's gonna exceed $250,000, we want to see that, right? Even if you're, we don't want to see multi year, where it's $250,000 per year. So that's clear. The contract splitting, if you're doing one year contracts, and Terry Black is a really good example, right? Um, she's, she's the best, she's done really great work for us. You might want to allow camera to be able to do that, and maybe what you want is just a report in that type of context. So you would see year after year, right, that we're using the same one, and if that Rosa raised a red flag for you, you could council could inquire about that. Or you could say, I want that, you know, the minute we contracted with her at $250,000, staff needs to come back. And I think what Arn was saying is, Once you hit that $250,000 with, say, terry breath, black, right? You might come back with a report that says, We want to do five years, authorized five years for us at $50,000 per year, or something like that, or at $100,000 per year. So they're not having to come back every single year. They would anticipate that Terry Black is going to be used for the next five or three years, and they would ask you for that authority up front. I think that was Arn's suggestion, so... Thank you, city of Trump. Yeah. You could have it with multiple ways to do this. Mm hmm. But I think that, to be efficient, you wouldn't come back every year for $50,000 after that. They couldn't do that.

[01:30:26] Unknown Speaker: Because what you want rightfully so. It's some assurance, through the policy, that, ultimately, things that get to a certain level are gonna come. come back to you. And to answer your question, the city attorney did a much better job. Trigger happens. We're back in your ballpark. So staff then has to articulate, through our report, what it is we're asking for, and that's when they would be... only asking for one more year, because we think we only need that to finish up X, Y, or Z. One we're saying, we think we need another three years to the contract, because this is happening. anticipated it's gonna take three years at a cost of X per year for a total additional, not to exceed amount of this. And so...

[01:31:06] Chair Lisa Matichak: And you can correct the language. in the policy to say that's what we're gonna do.

[01:31:11] Unknown Speaker: I am confident that fasting... Yeah, you know, can draft language that we come back to council would all we require, maybe? L tweaks. Okay. I like to set it.

[01:31:23] Chair Lisa Matichak: So are you two okay with that?

[01:31:25] Unknown Speaker: I guess... Just to make sure we're... I think so. You know, what I want this policy to achieve is to make it easier for staff to do the city's business, right? Without having to go to council, fundamentally. And I think the protections, or the controls, would include some transparency mechanism. So I do like the idea of a report. I don't necessarily need to authorize things. I just want to know that we're doing this above board, and that, you know, as I think the recommenda, the suggestion, you know, if we start seeing the same, you know, contractors or firms repeatedly, that, you know, we'd be able to ask a question, you know, is what's going on here, right? I'm okay with that, you know, if there are competitive bidding controls, that gives me greater comfort. I think the one thing where maybe it would be appropriate to go to council is if we're talking about very long term, contracts, you know, even, you know, I don't know what that number would be. And I can't imagine that there's a scenario where you would approve a 10 year contract under $250,000. I really don't know.

[01:32:34] Unknown Speaker: Um, I don't think we have any. We actually wouldn't approve a 10 year contract. No. Our contracts are typically, as I said, you know, we'll approve it for the year. Okay, we'll come back to you next year for the award for an up to five years, um, three years, typically with one year extensions. Um, but we do, we, we, not, or attend.

[01:33:03] Grace (staff): For the exception, I can think of this, we do have agreement with counties or some other government issues, like cowtrans, those are ongoing support, whatever agreement they have. They might not, at the end, they are.

[01:33:18] Unknown Speaker: It's just maybe pushing the envelope with utility billing systems, higher overhaul of major infrastructure that you're not gonna want to do again in four years. Right.

[01:33:30] Unknown Speaker: But just a lot of things to clarify for the body, usually inter, most inter... I mean, instead of long term,

[01:33:37] Unknown Speaker: come to the council anyway. Yeah. For some other reason, right? There's some other way. that it comes.

[01:33:43] Unknown Speaker: As a... as a... categorical requirement that something go to council for approval. It sounds like it's extremely rare, and they would come to council anyway, but there is some, you know, edge case where there's a long term contract that would technically fall below that threshold, maybe would be good to bring it to the council for approval. I don't know. That's the one fringe case I could see.

[01:34:05] Unknown Speaker: Let's use utility billing system again. It's not gonna be the case, but let's say it was not an expensive contract. We would still want to inform counsel that we're changing the entire way we do business, and we're moving from an antiquated system that we've had for 30 years. That's still a story. We would tell council regardless of the financial aspect. Okay. I don't know if that was helpful order. Yeah.

[01:34:28] Chair Lisa Matichak: This has been a good discussion. But I, um, so I feel like, um, we're okay if I'm very, very what you two are saying, um, with the... I feel like the two main questions here are increasing limits, and then, um, addressing the multi year contracts. And I feel like we're on the same page when it comes to that. location limits. We're gonna look for new wording, to address the multi year contracts, to make sure... I hate to call it contract splitting, but, um, so that council has visibility into use of the same vendor for the same service for a long period of time, and, uh, if the end now hits the original, nearly, uh, signature authority. And then, did you want visibility into what contracts has happened as part of the policy, or is that just, or is that something else? I don't know if it

[01:35:27] Unknown Speaker: needs to be part of the policy.

[01:35:28] Chair Lisa Matichak: I don't think it does, either. Okay, so, um... Is there anything... And then there were just minor cleanups.

[01:35:36] Unknown Speaker: Sure, I have the addition from the CIO regarding policy H1 on that number four. I have the elimination, uh, on that elimination, but on category three, we're doing some word smithing there. Instead of it saying, not following. I have category 12. We have numbers 10 and 11, we're changing that to actually say categories. We're deleting the repetitive footnote, and there was an four somewhere... That was striking. Yeah. Yeah. Number three. Thank you. Right, right. Thank you. So those were the other edits I have. Okay.

[01:36:14] Chair Lisa Matichak: Um... I guess, sir. Okay. Well, I move... Hold that.

[01:36:23] Unknown Speaker: Yeah, the move to approve the staff recommendation with the changes as recorded into the record. Second.

[01:36:30] Chair Lisa Matichak: I think we're good. We're okay. Okay. Okay, all those in favor? Okay. Thank you. And then just, um, outside of the policy, giving counsel for the stability into, in this change in policy, what contracts are getting signed, you know? Okay, we'll close that item. And move on to other four, which is, for those changes, for the phone, C, A, dash 11. Okay.

[01:37:08] Unknown Speaker: Yeah, I'll kick that off real quick. Uh, so this, this really was, we consolidated. We wanted to formalize some of our practices. Um, and we consolidated kind of, uh, threw documents into one with this, uh, into a council policy A 11, which is our financial and budgetary policy document. Basically, cleaning up and adding some wording from other policies just to consolidate, really, as well it was. I don't know, Grace, if there was anything specifically that we want to call out, but...

[01:37:39] Grace (staff): We update the council policy, we serve sections. Some of them are really due to the latest, the me, for example, the C level rise. This policy limited us to cap at only accumulated, we serve up to $30 million. As you can know, the latest study is 122 million. So this is one of the major reasons of updating this is to remove the fixed amount in the policy, to give staff more flexibility to update the reserve based on the latest studies.

[01:38:08] Unknown Speaker: We added the parental leave, you know, basically, like I said, just consolidating and putting into documentation, currently. And, like, Greg said, getting rid of some dollar amounts that we had in there, where we didn't want to be limited to. Because things change. That makes sense, yeah. Thank you.

[01:38:29] Chair Lisa Matichak: Any questions from the person?

[01:38:31] Unknown Speaker: Had a, but... I'm sorry. I'm difficult. So, one of the things... Or a thorough fiduciary? Um... So, there was a... I wish I had the... Right, the documents, that there was a... Yes. Sure. Um, so, uh, I have it as one D. We are eliminating the provision, a budget study session will be held annually to review the narrated budget prior to the submittal of the proposed operating budget to the city council. Is that replaced with something else, or are we not doing the narrative budget? anymore?

[01:39:08] Unknown Speaker: So we do not currently do the narrative budget. I think that was a prior practice. So... that's... This was aligning with our practice. So if there's concern about that, or like to have the narrative budget brought... Where did we stop?

[01:39:22] Unknown Speaker: So, let me speak to that chair, may I?

[01:39:26] Chair Lisa Matichak: Yes.

[01:39:27] Unknown Speaker: So, if you all recall, the narrative budget was essentially a rushed budget document that was given, I think, about just a few weeks before the recommended or proposed budget came to council. And in 2020, we stopped doing this because of COVID. And it's because we were coming to council more frequently giving budgetary updates way more than ever before. Um, before there was, you know, the mid-year update and the narrative, but there were just less frequent, um, check-ins. And so what we started doing then was, I think, the quarterly budget report. And so we brought to you all basically updates, I'd say, every, you know, 3 or 4 months with how things were going. And then candidly, when I was hired, one of the things that we discussed was that whether there was the need for a narrative budget because it was essentially a lot of staff work for the exact same budget document that you all received. Anyways. And it was almost like an albatross. Um, I think that had, um, been in the department for many years. So that's where it started, was really because we were just bringing more frequent updates in 2020. Now, I think what we had talked about and heard feedback from council in June. Um, was that um, council finance committee, this, this committee, this body, would have more input on the development process, the book itself, and looking at performance measures and really, I think, just kind of annually having more of a conversation about it as opposed to just that one snapshot in time. So I think we've kind of been morphine every year to kind of figure out and learn what's going to work best for us. And, um, at least at this point, I'm not certain, at least from a staff workload perspective that that notion of a narrative budget is, um, something that I would recommend that we continue just based on the value of it, um, or the lack thereof. But what I would like to hear from this body is what areas you are interested in. Uh, do you want the, you know, the quarterly budget updates still. Do you, you know, I know that we've talked about doing the budget document a little bit differently. So, I think there's there's value in thinking about the process that we use, but we've changed things every year and it's just been kind of based on what councils, um, you know, feedback and interests were that year. So if you remember, we did like a budget 101. During, um, COVID 2. And I think that, um, Derek, our new director has brought a lot of new things that we've never done before for transparency, like the budget video, the budget in brief, um, have we even gotten to that yet, Derek, I haven't looked. Okay. So we're, we are trying to be um, more transparent with the public and trying new things. So, I think we're open to, to feedback, but just, The funny thing was too is everyone's like, what is a narrative budget? I remember when I 1st heard it. I was like, what does this even mean? Is it a story? Like, I just, I just think let's, let's do what's gonna work for us now. Um, so that's really when it changed. So for 4 years. It, um, It's changed 4 years ago, basically.

[01:43:14] Unknown Speaker: That's helpful. One of the other things I noticed that these are the whole good tactical cleanups that I'll support. Um, I think it was, I think it may have been Council member Mattachek, in the budget, you would ask a question about, um, some trust something. The

[01:43:32] Chair Lisa Matichak: minor? Yeah,

[01:43:33] Unknown Speaker: minor trust or whatever. So I was there, I guess, two different ways of thinking about this. You know, we include a number of the reserves, but we don't include everything in this policy, and so I was wondering, um, should we be a little bit more comprehensive, and include all of, like, the minor trust, and all of that, or would it make more sense to just break out the reserves that are listed here, and put them into, you know, an appendix or an exhibit or something, and have something, we had talked about this, like, a budgeted funds gap, and just have everything there with a description and how where the funds come from, and, you know, whatever restrictions are imposed,

[01:44:12] Unknown Speaker: and all of that. Yeah, I think my vote would be for something like that, where it's a separate document, similar to, we do have some of that information in the budget as the budget guide, which lists all the funds, or most of the funds, I should say. But I think we, if we adopt or expand on that, basically, that document, we can include kind of the one offs, like that minor trust fund, and things that people don't know as much about. It's not as high visibility. So I think we would... we'd go in that direction. Okay. So

[01:44:45] Unknown Speaker: just clarify, that we serve here, all inclusive, what I'll be served right now, those are general funds we serve. The minor trust fund is a trust fund special, trust fund, which is not being served. We do, city has, you know, general funds, special revenue fund, trust fund enterprise fund. So that's why you don't see those here, but we do include all we serve that we have in this policy.

[01:45:08] Emily (staff): Okay, that's a helpful distinction. That I didn't know. Some of it is semantics, but for instance, the general fund reserve, to be funded at a level of 20%, on any other Tuesday, Council can make that 30%. dictates of a trust that it bequeathed to the city. You have no control over that.

[01:45:26] Unknown Speaker: It was more a question of definition. Right. Or explanation of it. It doesn't have to appear here, but it would be helpful to break it out like you were describing, just so there is a place you can go to understand. You know, what the, uh, um, the restrictions may be. Um, and, um, this is probably a question for another time. It's been a long time since I've looked through this policy. There are a lot of pretty high level provisions, and maybe they're helpful, or maybe they're not, but I was curious to know how, do we periodically check to see if you are complying pretty strictly with some of these things, or, and when is that done? Yeah, Grace, do you want to... So what

[01:46:10] Unknown Speaker: do you give all about the budget? Do we do have a research that we establish to calculate how much we serve, we should put in the budget, so we check against the policy every year when we develop the budget?

[01:46:19] Unknown Speaker: Not just the reserves, but there are a lot of things in this policy that, um, and I wish I had taken better notes, but I was trying to look for an example. There were things that, I guess, the narrative budget is a good example of that, that was in the policy. We hadn't been doing it for a number of years, and now we're changing the policy to reflect the practice. There are some other things in there that I was curious to, as I read through it, understand whether we're doing these, or it's just nice to have kind of language. At some point, it might be good to just update the policy a little bit more comprehensively. We don't have to do that today. But I was curious to understand, you know, like, who's looking through this to, you know, check to see if we're doing all of this stuff. Yeah,

[01:47:05] Unknown Speaker: but mostly rests with FASDI. I would say. And, um, as far as I know, we are complying with all of them, and that's what this part of this cleanup was, too, like you said, to, um, follow the practice of what we've been doing. So, um, I think that, you know, we can, we always look at it during the budget cycle, as well, to make sure we're getting all of these, but I think we can emphasize that a little bit more with the fastie group, just as a double check. But I'm...

[01:47:34] Unknown Speaker: Well, and... Chair, I would also say, in Council member, Amira, is that I've never worked anywhere that has this robust financial policies, and they really are best practices that many cities look to. And, um, really will copy the policies that we have and thinking about their own policies. We even did it in my prior agency. We looked at what Mountain View was doing because the policies were so good. Um, I look at the policies for sure. And there's things like that we're cleaning up now that we realized a while ago. It's just, you know, during COVID, we just didn't get to cleaning them up. So I think this is a good start. And to your point, we will definitely continue to look through them. Make sure that they're being followed. I'll also say that this is part of what the audit does as well. You know, we have an annual audit report. And they talk to us about our policies and procedures and whether they're being followed. They look at, you know, the policies we have, whether they're being followed, they talk to staff, they talk to me. Um, so I think it's it's good. The policies that we have are good. And, um, we can certainly look at other cleanup items or things that we might need to do just to get in line with our practices, but I think this, this really was the start to kind of kick that off.

[01:49:08] Unknown Speaker: That's helpful. I guess maybe to be a little bit more precise in my language. I have trust and confidence in what you're doing administratively. The administrative procedures and policies. I'm confident or good. The council policy is pretty high level, right? And there are a lot of things you could read through, and it's not... I'm not sure that it's terrible. There are some terribly valuable provisions in here, you know, unless we were to make it more prescriptive, or, you know, or I don't know. And maybe it's a general comment that we're not going to address today, but as I was reading through them, I wondered, like, is this hopeful to staff. Your administrative procedures are probably a lot more prescriptive and defined than what's in the council policy. To

[01:49:54] Emily (staff): your point, like, for instance, when expenditure policies, F, obligations to this city will be recognized when incurred. That's generally exactly the accounting principle. So, to you, we're just helpful? To you, we're saying we're gonna do it from an actual implementation standpoint. You know, that's making sure that we have folks in our accounting department with CPAs. They're following generally accepted accounting principles, you know. So you're right, you're not gonna see all that here. Which may, you know, be frustrating, and maybe you would like to see a little more, but it's kind of a mix. Some of it is, you know, like the reserve policy. That's up to counsel's discretion based on advice from staff. What do we think is an adequate reserve policy for the general fund, if we have a catastrophic event? Those are helpful. Right, but there

[01:50:38] Unknown Speaker: were some, I read that, um, where... So, like, I... Financial reports shall be prepared and presented to the city council on a regular basis. I don't know if that's useful, you know? I don't know, what does that mean? Do you look at that, and do you disagree about, you know, what, you know, on a regular basis means. I don't know. I think, someday, it might be good to just go through this and just, like, it could probably be half as long as it is, really. That's good feedback. Any other questions? I'm good, thank you. Do you have a question? I

[01:51:18] Unknown Speaker: think it's a question. I think I could probably take it a lot. Okay.

[01:51:22] Chair Lisa Matichak: Um, I didn't have any questions. I'll just say comments. So, um... still know members of the public? No. So we can just jump into comments, if you watch. Um, I will, um... add a few. Um, I did appreciate, uh, a lot of the ginges that were made. Um, when I saw the sea level reserve one, I went, Oh, wow. Yeah. Good change. Right. Um, and the addition to the parental media, from the loans. I agree with your comments that, you know, maybe you take a second look at this at some point. But for now, I appreciate the cleanups. The one area that I had printed on is on page three, um, the performance of workload measurements. Yeah. Yep. I find those useful. I find them most useful when those two items are separated, and so they're not mixed. And I think we now put them in with the department, as opposed to as a stand alone thing. But I actually wouldn't have them in the budget. We've talked about that. But if that's something that's required, to get the award, okay. But, um, I don't feel like those are punch items. I'm

[01:52:49] Unknown Speaker: curious. So the policy requires it, but is that something that is best practice in other jurisdictions? in the budget. From

[01:53:00] Emily (staff): a pure perspective and from a GFOA perspective..

[01:53:08] Chair Lisa Matichak: Comments, Emily? But

[01:53:09] Emily (staff): that being said, we are doing a review to make sure that if we are gonna stick it in our budget document, it's gonna be a little more relevant, right? And that's another direction, you know? There's a city manager. Yeah. It's gonna be there, and if it needs to be there, let's try and make it more relevant. I appreciate that. Do your thumbs up, please. Uh,

[01:53:27] Unknown Speaker: so, uh, when... we mention a lot that, like, we kind of make our budget. One, hopefully, to, uh, be a good budget for, and created the way that our residents will want. to see, and those who are interested to want to see. But there's also a lot of mention of, like, Oh, we get awards for this. I would love to know what, what, what awards we are going for, and what are the criteria for those awards? I'm assuming, because they're, like, awards, those are good criteria, but, like, I don't know. So I'm

[01:53:57] Unknown Speaker: happy that we can, I think maybe it might be helpful for the group. We can share the GFOA glyphs with you just as an informational item, that's the biggest award, I would say, that we get. That's the National Finance Officers' Association. Award. Um, and so I think that would be helpful if we share that criteria with you, 'cause since you'll see how much is in there. And

[01:54:19] Emily (staff): the director has said this before, but... We talk a lot about the budget document being a communication device with our community. When we say community, we think of citizens. But there's also another community, which is the financial community and underwriters, which, if the city ever wants to go to market to issue bonds, we're also speaking to that community. And so, having the GFOA award is actually relevant to the underwriter community in the sense that, you know, as they're, as they and the rating agencies are trying to determine what they're gonna rate, an issuance, if we come to market, it is one of the things they look at. And so we speak to a couple communities. I mean, obviously, our local community is paramount, in terms of importance, but our financial community is paramount, if we need to go to market, and we're trying to get the best rate we can in the market to have the cheapest amount of debt.

[01:55:12] Unknown Speaker: And I would add, too, thank you for bringing that up, Arn, 'cause what I was gonna say was part of our AAA credit rating. It's not just about our, yes, it's about financial solvency. It's also about our policies and practices. So when Moody's and standard and pores, and they look at agencies, they look at the whole internal aspect of how your operation is ran. And certainly, yes, you have, you know, good solvent revenues. You're not, you know, spending more than what you're taking in, but they do look at the practices. And so part of these like administrative instructions and all of the things that we do in Mountain View has really led us to the place that we're at right now of being, you know, very fiscally responsible, financially stable, and it kind of all goes together. And so the budget book is really meant to be storytelling. And, and Emily, you get the prize for doing the audio version of the budget book for however many hours you said, 12 hours, I think, where it translated for you. But um, it definitely, it definitely has a lot of information that may seem like, why is this in there? But it truly is because not only is it required for the awards, but our auditors look at it. We have a lot of other outside agencies that go to it for information, and as Oranges said, when we look at doing any bonding. I mean, it's really important to have that information be public. And I think we can definitely do a better job in presenting it in a way in some of the areas that's less, um, I guess, onerous, easier to understand. But there, there are some things we just have to do it a certain way, just for the financial community.

[01:57:12] Anne (staff): It's totally unscientific. Well, just go ahead and say it. I bet there's a correlation. between agencies that don't get the GFOA Award, and end up not having unmodified opinions. Usually the non GFOA cities, so have material weaknesses, because they just don't have the infrastructure and the talent to assemble what would be a good act for. It's the same type of exercise you have to go through, to assemble all the materials you need to put forward the GFOA to get the award. And so, totally on scientific, but I bet if I did it, there'd be a high correlation.

[01:57:48] Unknown Speaker: What I'm thinking, and understanding the response to your question is, maybe the value of the council policy is making transparent, the GFOA criteria, for instance, like, that's what we're doing, right? It's a lot more valuable than some of the instructions in the council policy, which provide no real guidance. But we don't know the criteria, and we don't know what the finance community needs to know and see. So I feel like the council policy can be a tool to help make, like, make it visible to the council and to the public, what it is that actually guides the...

[01:58:25] Unknown Speaker: Well, I think that's a great idea. And the other two that we can provide you all is, there's 2 other big awards that, you know, we pride ourselves on getting every year. We also have an award for our Akfer. So our, you know, final comprehensive annual finance or report and also purchasing our purchasing policies has won a national award too. So I think we can share those all with you. Just so that you can see the exercise that we have to go through in order to get those awards. The last thing I'll say is you may wonder, okay, who even decides which agencies are getting the award. So the way it works is that it used to be that you had to turn in your budget document like the big physical hard copy of it. And then those would be mailed to people, various financial staff, or financial experts. sometimes they're professors. Um, sometimes they're consultants in the field, but they would literally be mailed to people across the country that have nothing to do with whatever agency they were reviewing. So it's almost like a peer review in a way. So you would have 3 different people reviewing your budget from all different people across the country. So, for example, One year, I was a reviewer. This was many, many, many years ago. And so the people who submitted the award and I was a reviewer for 3 agencies, but there were other people also reviewing those agencies. And as a reviewer, you also have a checklist. Like for an agency to get that award and to be considered to be at the top of the field. You had to go through literally and identify, yes, this was in their budget document. Here is what it is. What did you think about it? And it was a pretty detailed exercise. Now it's electronic, but it's still the same way. So, you, you have people looking at your budget who are experts in the field. And it's not just one person. It's people that are part of GFOA. And that's the same for the other budget awards that we've won. So it's a pretty, it's a pretty robust process. And, um, you know, I would say most agencies don't have, what's our history, like 30, some almost 40 years of getting the GFOA award. So that's, that's pretty laudable. But if that gives any more perspective and just how it works, literally you have like peer reviewers looking at your budget document and then checking off every single thing to make sure that it's there. Okay,

[02:01:02] Chair Lisa Matichak: so we are running a little bit behind and we've got our outside people joining the next meeting.

[02:01:07] Unknown Speaker: We will have consultants joining.

[02:01:09] Chair Lisa Matichak: Okay, so, um, maybe we could pick up the pace a little bit here.

[02:01:13] Unknown Speaker: Want me to move the staff recommendation?

[02:01:15] Chair Lisa Matichak: Thank you. 6.4?

[02:01:18] Unknown Speaker: Just to a quick response to something Chamber said earlier. You know, I'm comfortable with not proceeding with the narrative budget. But I do think, sometimes, the council likes to make modifications to the budget, and we've got little ideas that we want to incorporate, and making sure that staff have the time and ability to that those recommendations or suggestions from the council would not just have them put in at the last minute after you've done all of the work coming back with a balanced budget. I think there was some value in something, like a narrative budget study session, to allow for council to provide input and give staff time, to think about it, and then return with recommendations.

[02:02:03] Anne (staff): Those were some of the comments last year. And so we're gonna figure out a way working with the city manager to build in a, you know, a process to make sure that feedback's heard. Thank you.

[02:02:13] Chair Lisa Matichak: Okay, so we have motion second, all in favor? Mm hmm, yes. No amendment. Right. Um, so we're moving on to 6.5. Move the step recommendation. Tom.

[02:02:29] Unknown Speaker: Come on, you're not gonna ask me, Tash, any questions?

[02:02:32] Unknown Speaker: I just wanted them to sit there for... Yeah. I do have one brief. It appears, there was an inadvertent pure in the... And so, the committee actually received an interim draft document, rather than... formal red lines. And so... Oh, no.

[02:02:57] Unknown Speaker: There's one small... There's, like, a couple of typos were already fixed, but there's only one small thing. He's gonna point out that was exactly missing.

[02:03:06] Unknown Speaker: Yes. And so, uh, Crisso, there are some minor typos, you know, period spacing, uh, and, um, on the final page, you will see a reference to, um, I believe it is bullet point 3B. The city attorney, in the current copy that's been uploaded of the public agenda. It says the city attorney shall retain the file for a period of five years, following the claimant's execution in Los Angeles. Yeah. And in the, uh, and if you will so amend the policy, it should state that the, uh, city attorney shall retain the file for a period consistent with the city's retention scheduled. Okay. And I'm here for any other questions?

[02:03:48] Chair Lisa Matichak: So are there any questions? Um... Do you have any questions? Let's see. I had the opportunity to go over this with an obsidia drink. Um, and was, I recently talked about, reflected now

[02:04:08] Unknown Speaker: in this version, that we just got? Yes, we've, well... Not in that version, but your typos, like, um, the is gonna be put before city council, we're gonna make those little minor corrections. G is... Yes. Yes. Okay. Yes.

[02:04:22] Chair Lisa Matichak: Okay. So I guess I don't have any questions. Um, do you have any members of the public? So, um, are there any comments, then? Um, I'll just say I, um, think good changes. I appreciate that we're doing this. I think we'll streamline things a bit, and which is always too big. So, um...

[02:04:51] Unknown Speaker: I moved sat for incrimination.. I was in favor.. Thank you.

[02:04:59] Chair Lisa Matichak: Thank you. Definitely. Pick it up, please.

[02:05:02] Unknown Speaker: I think we did the part items for... Okay. Okay.

[02:05:06] Chair Lisa Matichak: So, item 6.6, is the budget in brief documents? Glad you're doing it. Thank you. Appreciate it. So,

[02:05:16] Unknown Speaker: item 6.6 is basically just that we wanted to share the budget and brief document, which is a final draft, and also the budget video. The, uh, FASDI, keyed up with the communications team this year to develop these two dots, uh, two items. And I'm really proud of how they turned out. We did have a consultant help with the budget and brief document for the graphics side. And so, um, happy to hear some feedback before this is released. The budget and brief document is finalized, basically. What we're looking for on this item, and then, same with the budget video, I think, any feedback. But really excited to present the two of the two items to you. So... Are there any questions?

[02:06:03] Chair Lisa Matichak: Yeah, any questions? So, um, I have a couple questions. And actually, I really like this. It's great. Mm hmm. Um, we have climate change mitigation listed on page ten, uh, which I think is good, but why do we not include sea level eyes in that? And having a much larger number?

[02:06:34] Unknown Speaker: Yeah. Why don't I?

[02:06:38] Unknown Speaker: That was, that was an oversight. We should, because so this was taken from the letter where we did talk about our sustainability needs. I mean, we have climate change mitigation. So I think that's where it was supposed to be under that, but we can change the wording.

[02:06:56] Unknown Speaker: I interpreted this as things that could plausibly be funded with the revenue measure, and seeable price, I had presumed, would be entirely shoreline community funds, not revenue measure. Oh, that was my thinking about that, but maybe...

[02:07:13] Chair Lisa Matichak: And that's correct. Oh. Okay, that makes sense. That's what the thinking was. I get it.

[02:07:21] Unknown Speaker: This is more general... general... Yeah. Fund needs, general city needs. not related to shoreline, per se, that we...

[02:07:28] Chair Lisa Matichak: Although, we do have some stuff in here that...

[02:07:30] Unknown Speaker: Could pertain to Shoreline. Could pertain to Shoreline.

[02:07:33] Chair Lisa Matichak: Um, I think.

[02:07:39] Unknown Speaker: We tried not to really frame it with Shoreline, this, this... I mean, you're right in the sense that, you know, climate change mitigation and affordable housing. There's definitely going to be, um, affordable housing projects out in Shoreline, North Bay Shore area, but this really was framed in the sense of, we, we are financially, you know, have good financial foundation now, but in the future, we have a lot of things that our general fund is going to need to cover. And that was part of the budget message. In the um, message. It was part of what we talked about when we had our public hearings. So this is really just kind of setting up that sort of, um, you know, transparency for the public about why we need to look at revenue measures over the next probably couple cycles because we have a lot of things to pay for that we don't have money for.

[02:08:35] Chair Lisa Matichak: Okay. Um, that makes sense. My other question is, this one is just another little hot button in mind. When we say, let's pay our dollars. What do we mean by that? So, you'd bring to a page in particular, just so I can... The very first sentence. And stewards, and tax payer dollars. I personally think we're stewards of... one more than just... More than just taxpayers. taxpayer dollars. The city is not just running on taxpayer dollars.

[02:09:11] Anne (staff): A steward of city finances. City resources. City finance. State resources.

[02:09:18] Unknown Speaker: We could even say stewards of, um, yeah, public, public funding. Public funds? Public funds. Yeah, I mean, It's just a phrase that everyone likes to say. And so I think we're we're kind of playing into it, but we can certainly change it. Or Jarvis wrote it or something. Yeah,

[02:09:37] Chair Lisa Matichak: people use it all the time. You use it every time you report when you attend a conference. I think. Taxpayer dollars. I always... I might be lifting

[02:09:47] Unknown Speaker: that directly from the policy. You might. Yeah, 'cause I... They publish that... Yeah. I could say public funds. Yeah. Um,

[02:09:56] Chair Lisa Matichak: okay, and then, um, I don't have any other questions. Um, and then there are no members of the public. members. So...

[02:10:07] Unknown Speaker: This is the one error. Yeah, yeah. The strategic priorities? Yeah.

[02:10:13] Chair Lisa Matichak: I did not look at that thing. page. five. Yeah,

[02:10:15] Unknown Speaker: down here, you have prepare a citywide travel demand. update twice. Okay. Yeah. But aside.

[02:10:20] Unknown Speaker: You just care about it that much.

[02:10:23] Unknown Speaker: Well, you know, I think Lisa and I have sort of this friendly competition. Who can spot the most, you know... Hi, bows and hairs. I try to help. Yeah,

[02:10:32] Unknown Speaker: we added the, so we're going just for the committee's information. We are on the page prior. We talk about how they're organized by priority AD and C. We may expand that a little bit to let the public know what that means. I don't know if, you know, A, B, and C means anything to anybody. So we added that kind of recently, and so that probably got duplicated, so...

[02:10:52] Unknown Speaker: Good catch. Honestly, great work. I think it's a big document to digest, even for those of us who have been doing it for a little while. And I think it does a great job breaking things down. And I would be curious to hear once it becomes a public engagement tool. What members of the public would recommend that we adjust in the future?

[02:11:19] Unknown Speaker: But I think it's a really good start. And we're going to be printing this in very high quality, very similar to, I think, what they call the view, comes out with that state. So we're printing in high quality, and we'll be setting it out at various low city locations, so people can pick it up and have it. Copy.

[02:11:36] Unknown Speaker: I just... Maybe this is in there, and I don't remember. One thing that might be helpful to elevate is the neighborhood grants, just because that's something that is intended to go, like, out in the public and...

[02:11:47] Chair Lisa Matichak: It directly touches the public kind

[02:11:48] Unknown Speaker: of thing. Yeah, yeah. Yeah, we do not have that in here currently, so... It's small, but... I don't know. That'd be cool.

[02:11:56] Chair Lisa Matichak: Yeah, I'm fine if there's space for it to include that. Okay.

[02:12:00] Unknown Speaker: Look, we'll look to see where we can fit that in.

[02:12:03] Unknown Speaker: We could try and maybe do a section, Derek. $30,000, I believe, is what council allocated. Yeah, we have that. And we could just do some sort of maybe find a little place to carve it out so it stands out. So, um, because everyone's going to get this, right?

[02:12:18] Unknown Speaker: It's going to go to every... Are we sending it out or is it just going to be...

[02:12:22] Unknown Speaker: have it on the website and we're going to have it at the locations where people can grab a hard copy, which I think is nice. You know.

[02:12:29] Unknown Speaker: And then you all can take it with you. That was either part of it, that if you needed and you needed to have it handy, then you can have it, if you even wanted to have copies to hand out, you could do so.

[02:12:43] Unknown Speaker: Is this for both of us and a brief on the video? Yes. Oh. Yeah.

[02:12:47] Unknown Speaker: Yeah, we haven't protected the video yet, so we... Oh we're gonna watch it? As it is a pop... subscribe to the channel? I've seen it already, too. Oh, nice, okay, okay, yeah, I would say all our consultants are here for the next meeting. Yeah, okay. Yeah. We don't need to... Yeah, if you guys have all seen it, then I'm fine. Yeah, not. I thought it was good. Thank you.

[02:13:04] Unknown Speaker: I would take advantage of the description section to give people, like, either access to a full budget or the budget and brief, as well. We actually have on Reddit, there's someone that really pushes on YouTube for us to be more active on it, and he's very judgmental in how we use it.

[02:13:20] Unknown Speaker: I like our YouTube channel. No, no, he looks

[02:13:23] Unknown Speaker: good, but he wants more.

[02:13:24] Unknown Speaker: Yeah, oh, yeah, absolutely. Um...

[02:13:30] Chair Lisa Matichak: I have a couple of comments. On page four? And this is another one I feel like I always flag. Um, we say that we have these projects, um, for inclusion in the work plan, to fulfill. I'm not sure we're able to really fulfill seven strategic priorities. We can make great strides towards, you know, furthering them, but can we... I think we can fulfill. So, um, I was trying to think of other words. Advance, Advance, yeah, or implement, or something. I'd say advance. The implement could mean the same, could mean, we're done. There's an assumption of completion. Yeah. Do you know, with implementation? Yes. Okay. Um... And then, uh, this is another little nit on page seven. Um... There were some kinds where you put an appleized in the lower chart, um, like, staff prepare is not appleized, but other words, similar to that R. I thought, I can't figure out the capitalization here. Same thing with staff continuation of budget preparation. Well, just, we'll make that consistent, basically. Yep. Okay. Um, I will say, I thought it must have gone to an outside agency or something to do this because this is an incredibly well, uh, visually, um, prepared document. They go into

[02:15:02] Unknown Speaker: sending orders. They do.

[02:15:03] Chair Lisa Matichak: I noticed that, thank you.

[02:15:06] Unknown Speaker: Yes. Yeah, we use Tripeppy Smith. That's actually, which is... Yeah, like that. multi year content. No. It's only a one year contract, but, yeah. Yeah. Well, time the other four years. I think it turned out great. I think it did. with your action and the colory. They used, obviously, branding it, really... It's very visually... Yeah, pictures. Really good. Um,

[02:15:27] Chair Lisa Matichak: and that's... So there's no vote or anything on this. Any other comments? Okay. Moving on. We'll close that item, and we'll move on to item 6.7.

[02:15:42] Unknown Speaker: 6.7 is just an informational item, just, uh, I wanted to loop the CFC in on kind of our important dates for the budget process, just at maybe a quick and easy, kind of guide for you three to see where we are at in the budget process at any given time. So it's just really informational item, no action, or nothing really looking forward, just informational. Well, one thing that I'm sorry.

[02:16:10] Unknown Speaker: That struck me as important as we're doing labor negotiations, and I know, that's kind of... I think we all acknowledge it will probably be a little bit harder this time around than it has been, maybe. Maybe I'm speaking outjurned on that. Um, it's always hard. But, uh, I think I don't remember, is our inaugural closed session in January, February. When

[02:16:36] Emily (staff): do we start working on? So currently HR is starting to work up timelines. Okay. Uh, there's been other work they do throughout the year, knowing that we were coming to this point, then we will do our first, uh, kind of real, uh, internal debriefing meeting, with camera, and then that will move fairly soon after that into closed session. Okay. I

[02:17:03] Chair Lisa Matichak: don't have anything, either. There's no members of the public. Anything else? Okay. Um, moving on to item seven, which is, maybe, some questions. Maybe matter seven. Thank you very much. Very heavy agenda. Yeah, that's full. Okay, sure. 8,

[02:17:29] Emily (staff): 10, 8, 11, and 8, 5 are great steps for the organization. Today was a full agenda, but those were really good. Really good stuff. Very excited. So,

[02:17:42] Chair Lisa Matichak: the, um, only comment I have is, I would like to see, um, the agendas for these meetings, mayor, the ones for the council. So, I feel like that's the template for how material should be organized. If we can use that, that'd be great. Yep.

[02:17:58] Unknown Speaker: Yes. Noted. Okay. Um,

[02:18:01] Chair Lisa Matichak: anything else? Okay. We're gonna adjourn the meeting at 4:00?

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