Member Chappelier present. David, can you mute? Excuse me. David, can you mute? Member Verdelli. Member Cornfell here. Member Zarelli isn't present. and member seagull isn't present. Chair vice chairperson
Greenwall present. Chairperson Riyami present. And finance director Delina and the assistant finance director Matthews is present. To the flag of the United States of America and to the republic for it
stands, one nation under God, indivisible, with liberty and justice for all. Next is the approval of the agenda. Are there any additions, deletions? Move we approve the agenda. Second.
Second. All in favor? I agenda is approved. Any public comments? Anybody on? No public comments. Uh approval or discussion. First of the
minutes of February 24th. Are there any additions or deletions? Hearing none. Is there a a motion to approve? Motion to approve the minutes. Second. Second. All in favor? I
any unfinished business? None. New business. The preliminary fiscal year 2026 operating budget presentation. Thank you. Um, we uh we talked about
this with uh with the uh with the board on June 17th and so uh many of you have told me that you watched it and so again we'll but we'll rehash it. If you have any questions please feel free to stop me. Um
the uh this year's theme if if there was to be one is uh capital focused and uh as you can see every every fund is going to participate in that. Uh you can see that uh well first of all let's
talk about what our goals are. Our goal is to maintain the millage rate at 3.5875. Um, we recognized uh about a 6.7% increase in uh taxable values and that comes from the property appraiser. Um,
as you can see there, our our focus is going to be capital. It's going to be, you know, the the general fund with the with the old fire station and the uh police um uh dock in in the back. We're
focusing on that. uh discretionary, keep in mind discretionary that ends December um December 31st, 2025 of this year. Building fund and then and then water and then sewer is really the other big capital focused program and that's
really going to be the sewer lining. Um this is a preliminary budget. So, uh, we're going to have, uh, probably three more, uh, renditions of this as we get a little bit more clarity. Some of those clar clarification items are health care
and general insurance. Uh, uh, we we've assumed that, uh, staff compensation is estimated at about 5%. most of our bigger costs on the staff side. We have um uh bargaining,
collective bargaining agreements with the police. Uh fire. We've learned that in 2026 they're going to be going forward uh with their request to uh be part of a bargaining collective unit as well. Uh so these right here are just
come kind of these baseline assumptions. We we also had anticipated that um water and sewer rates were going to increase by 5%. Um and uh that was down from our initial uh estimate of about 8%. So
that's good. Um as you can see here and and as you've read in the packets, these right here are our accomplishments uh for for 2024 and and going into 2025. These are the things that that we've either we've either taken steps to start
the process down or we've successfully completed it. Um this uh 2025 2026 this is what the board had set as their strategic projects and initiatives. You know you can see there that the uh uh
the marine docking facility. You can see that uh embedded crosswalk lighting. You can see the the next one down is the sanitary sewer lining project. Uh and so we've after we were successful with
building the beautiful fire station behind us and setting that up carrying dual fire departments while going through that entire process and we were on time and under budget and we hit the mark where we needed to. This year we're
we're taking a focus on other capital projects. But just to reiterate uh what's made up of our millillage uh the operating side there 3.1159 mills and as well as the debt service on
the fire fire department there that that combines our rate to set at 3.5875 mills. Uh, keep in mind that, you know, we've maintained that same millage rate since October 1st, 2022 or FY,
excuse me, 2023. Um, so, and this is for the 2026 budget. So, we're going into our third year, but this right here is kind of our history of what has made up our millage rate. You can see that uh that during
2022 2023, you know, we also sent money from the general fund over to the water department because the rates weren't where they needed to be. And so the general fund kind of subsidized it uh somewhat. Uh but as we as we raised
rates where they needed to be and as we move forward, we were able to then focus on the fire department. And now you can see that uh what our rates what our millage rate for the town is made up of
is operating the uh the general fund as well as uh the debt on um on on the financing portion of that cost. But in reality here's kind of the bigger
story. As I said before, you know, we had a steep increase uh, you know, during these years here during, you know, during the years of, uh, 2022, 23, 24, you know, you had double-digit increases in in, uh, in taxable assessed
value. Uh, but now we start to see that come down a little bit, right? We started to see that in in this current fiscal year, you know, uh, property values only grew by 9% and now it went that back down to 6.7%. And so the the nice thing about this
curve is is that it it appears that the steep incline is starting to transition to a gradual decrease which is nice because you you don't want uh any sudden uh sudden movements in your assessed
value. Now why is that important? That's important because 73 70 between 73 and 75% of our revenue, right, comes from property taxes. And uh so that's uh that that that's an
important uh measure really. And the town is unique. Some towns you'll see where 25% of their revenue is property taxes and and they have a mix of gas tax and also shopping malls and things like that. a lot of sales tax dollars. Ours
is predominantly obviously property taxes, but the uniqueness about Highland Beaches is that uh this town is a concierge type of service town. Uh we are full service police, fire, water, sewer, library and everything revolves
around that. So all the users uh pay for that uh for that service. But uh in general right here you can see the general fund. Now, we're going to talk about the general fund and kind of here are some of the changes, the the
blue to blue I I call it. So, you'll see here like the FY25 what our budget was and this is our proposed FY26 budget. Uh you'll see that the the one main line there is red and what we're looking at here is we're
looking at the revenue side of life. Uh you'll see that grants really went down. Well, that's because if you recall, we used to have ARPA funds, right? So, we we used to have ARPA funds back in the day. Uh we had to spend those out or lose them and and we were successful at
doing that. But right now, you know, right now that's that's really the only major uh decrease. Um but you know we've had obviously you can see our major sources of revenue there are property taxes uh followed by intra
intragovernmental u that's that's mainly what we um what we get from uh from our other other departments which we'll show you that that we're we're going to be bumping that up probably about $200,000
predominantly from the building fund. you know, the the building fund uh has to pay for its fair share of overall costs and uh including the building that it's it currently sits on.
So, we've gradually increased that and as you can see that there. But but overall the revenues we're anticipating are going to grow at the bottom line there. They're going to grow at about 5.6%. which is a good growth because if
inflation is at like at 2.5 2.7% currently, keep in mind we just came off of the 10% type of inflation. Um, this is a good growth to not only carry out our capital needs but also cover our
anticipated costs that that that that will increase. But overall, this is the the revenue that we're going to use to match the expenses. And so now I'm going into the other side of that. I'm going into the expense
side, general fund expenditures. And so as you can see here, uh personnel, you know, personnel, we, you know, we had assumed about a five a little bit over a 5 and a.5% increase in personnel. Operating expenses are going to increase. Here is where you see the the
the biggest chunk is the the capital outlay. You know, we're going to add more money to capital outlay. Now, the red line there means that we're not when you see appropriation to reserves, that's taking current year dollars and
sending it to our savings account. Well, you can see in this case here in prior years, we were able to do that because we had doubledigit uh rate in rates for our property values, but now we're obviously going to
use those dollars that we're going to get in the current year to start investing in our capital. And so, you can see that you can see that overall our 2025 budget is going to go from 18.4 4 million to 19.5 million and most of
that is through personnel services as well as operating and capital outlay. But you can see here on the bottom where the the dollar gets stretched. Um you know it is it is we are uh uh labor and
related expenses in a general fund that that that tends to be the most expensive aspect right of of running an organization. You have a question to question. Is there anything uh either unusual or expected to be recurrent in uh operating
expenses that would account for an 11.4% increase? No. What we what we did there when when you're talking about operating versus capital cap operating is mainly maintaining what you currently have. a
capital outlay is that uh improving the c the the structure of it. So really again we're just looking at keep in mind too that we have a brand new fire station and so we know that there's going to be additional additional operating expenses that we're going to
that we're going to foresee there. But uh it was I I see where yep it's an 11.4% increase from the prior budget. Uh but overall it there's nothing really that that stands out that uh that that would
cause us any any alarm in that. Yes sir. The this history but I I might have forgotten the police cost from 3.4 million to 5.3. Uh what uh what police looking at the general fund expenditures? Yep. Oh, on the on the
department side. On the department side. Yes. 3.4 for the police and 2025 is coming up to 5.3. Yes. Yeah. You might have explained it last time, but I forgot. But why isn't it the steep increase? Well, this right here was
actuals and this is what we were budgeted. We had we had budgeted for uh for FY25. We thought that we were going to do the uh the post office behind the when we got rid of the post office behind us. Uh
when that went away, we thought that in 2025 we were going to tackle that project there as well as the uh marine facility unit. Right. So, we just didn't get around to to doing that. 2024 the
actual expenses. 2025 we anticipated to get to those uh ex uh expenditures where we're really just shifting that capital cost over to 2026. Now you're saying 6.1
is the number? Yes. Yes. That's very general terms. What is that exactly for? That is exactly for the police for the new Marine unit. So that's that's the that's that Yep. Yep. get one. Yep. As well as the next question. Is that Yes.
Yes. Yes. Yeah. Yeah. Yeah. So, you'll you'll you'll see that those right there are kind of the the biggest swings as we said before is the capital plan. Um and that's kind of what what you'll see is the difference between between these two
budgets, right? Thank you. Yes. Uh but when we look forward, we look at what our estimated fund balance is going to be. What a fund balance is is that's our estimated reserves, you know, and so when we look at, hey, what does that
look like? And you can see here on the chart here, our fund balance is nicely allocated between these categories, between budget stabilization, disaster recovery. we have a little bit in uh fire rescue. So, what we're trying to do
is we're trying to build up that fund there for down the road when we need a new piece of fire equipment. Uh and then you'll see there unassigned. Unassigned means that hey, uh we can budget capital projects up to this amount. It's not
restricted just yet. Uh but you can see that uh right here if you look in the far right hand box that 2025 FY2025 we're anticipating adding more funds to our reserves. So see the plus sign there
plus $833,000 is going to drop to the bottom line and then and then that balance goes right up into 2026. And you can see that this year we're going to be pulling some of those funds to cover some of the capital
expenditures. But overall, we have a nice balance between budget stabilization, disaster recovery, fire rescue, and unassigned fund balance that makes up that that balance.
[Music] Let's talk about discretionary sales tax. Discretionary sales tax is a separate fund and this ends on December 31st, 2025. So, uh you can see that historically,
you know, this year we have budgeted that we're going to get $415,000. Uh you can see that the new proposed budget is only about $107,000, right? So, we cut that we cut that by by 75% because we knew when that's going to
end. And so we have a little bit of investment uh earnings as well as in prior years when you see appropriation from reserves as revenue that means that's like retained earnings, right? And so what we're going to be doing is
we're going to be pulling money that we haven't spent in the past in this fund and we're going to bring it into uh this year. Uh so once the money stops coming in from this fund, we're anticipating that this fund will end at the end of
FY26 and no more revenues will be coming in from the state of Florida for that. But what we're plan on spending right here, you'll see our capital expenditures. you know, we plan on spending the biggest one is we're going to use the
discretionary sales tax fund, the remaining balance plus what's currently going to be put in there uh on on that crosswalk, right? We're also we're using it to continue to pay for the Axon body
cameras for the police department. And so you can see there that these right here are the capital expenditures that we plan on using those funds for. Uh typically you do not use uh these funds for any type of operating expenditures.
They're more for capital. Yeah. Right. Exactly. Now, right. Right. So, uh now after now we're out, we've talked about the general fund and how the general fund's main focus is going to be capital uh intensive. We talked about
the discretionary fund where those funds will be ending in December 31st and that we're going to spend those money on capital improvements, predominantly the crosswalk. Uh now we're going into the building fund. The building fund, right,
73% of the revenue obviously comes from charges for services. Um you can see here on the bottom that um that historically uh this fund continues to benefit from the interlocal agreement uh that it has
with Gulfream and um and and the the interesting thing is is that this fund here this fund as well the the last bullet point there they're going to use some of the reserves for capital improvements and we'll get into that in the next slide.
But overall, this fund continues to do great. Matter of fact, it's doing too well. Uh we're bringing before the board to uh reduce rates by a little bit over 12%. The reason why is if I go to the next slide, let me show you. Let me go
to this slide. Let me go to this slide. The state of Florida frowns on the fact that you have so much money in your reserves in the building fund. They don't like that. And so uh and so staff
has decided that you know uh we are going to spend some of the money on capital improvements including the roof that is behind that is behind us that covers their their building. They're going to work on the entrance side of
their building as well as uh uh chillers for the air conditioning, things like that in that building. But at the end of the day, you can see that the amount of money that they're bringing in versus what they're spending versus their capital. Um
we have to we're almost mandated that we have to begin to look at reducing rates. And so we will look at that. uh our building official has given us a a broad spectrum that hey it looks like we can
we can still do fine with a uh a little bit over a 12% decrease in permits and related charges. You can see right here that they've got 500 at the end of this at the end of next year they're going to have 513 days of of operating cash,
right? I mean uh you know and that's and that's pretty significant. And so uh that was one of the things that we looked at and we said okay you know eventually uh this is this is growing too rapidly and we have to control it. And so we're controlling it with two
levers. We're going to be pulling more money from the building department to cover their overhead related cost to the general fund. Let me show you here. So see this transfer line item. I'm back
one slide. Historically, the building fund, if you look at transfers, this is an expense. Historically, they've sent the general fund $500,000. Well, we're going to bump that up to $700,000.
Uh and and so what we're hoping is is that because the town now has its own fire department, uh the town the also the general fund also takes part in the discussions and contract negotiations
with Gulfream that as costs tend to increase, we have to reook at what overhead the the building department should be reimbursing the general fund four. And so our preliminary numbers
came back at, you know, they need to pay a little bit more in for fairness. And so that's that's what we included in this budget. But all of that goes to reduce down uh their fund balance, their
estimated reserves. And so uh that's what we're hoping to do uh in 2026 as well. So told I told that Remis guy he charges too much. I know but gota brain him in. Right. Right. Right. But you know but he's
doing excellent job and you know the some projects extend out many many years. Uh but but at the end of the day uh we looked at it it's been on our radar that hey if this thing continues to grow but it it's not growth related
here in town as much as it is uh refurbishing these properties you know um and um it's a good thing but looking longterm we're carrying too much money in the building department reserves and
so we have to take steps to reduce that. Why is that an issue? It's an issue because statutoily this is a this is a fund that charges
for services, right? So, think about it, right? Governments have to be fair. We have to be able to show that, hey, what we're charging you u is reasonable in nature.
rate versus uh well that's a very good question. Uh the only thing we can control is the rate, right? We can't Yeah. Uh yeah. Yeah, that that's right.
I have a disconnect. The rate's market based. That's fair. Why is there a limitation on that fund? Because they're looking at the pie total versus a slice of pie. Yes. Yeah. Yeah. So, what they're looking at is they're
looking at what is your operating costs versus how much you have in reserves. And so when they look at it, they sit there and they say, "You can't have over 500 days of of of of cash that you're hoarding.
you're char you're obviously to the regulators you're obviously charging too much for what you need to charge to carry out your task. I don't necessarily agree with it, but at the end of the day, matter of fact, that's why this isn't a separate fund, right? Think
about it. This isn't even in the general fund. This is a separate uh it no it has to be related to building related activities. Yes. Yes. Yeah. So, yes, just one comment. I mean,
obviously you mentioned that I mean this is obviously a good thing that the that the building department is doing some so Yes. Uh but you know, you mentioned they're going to do some capital improvements to relate to uh their
space. Yep. And related space. Um that uh you know, they're going to pay a fair share of general expenses. Yep. Uh they're going to reduce their charges. Yep. The other thing, and I don't know enough
about the building department to know that it's worthwhile, and this is not something that I typically recommend, but if they have the money, which they do, and I don't know if there's anything that they could do, but if there is anything that they could do to actually
spend more money, but to improve services as seen by the residents of the community, and again, I I don't know enough facts to really judge But in terms of, you know, making the interface smoother between residents and
contractors and the building department in terms of getting permits and following through on permits, uh, anything that that that could be done in that regard that might increase their overhead but would be a value added
service to the community, I think uh, might actually be appreciated by uh, some of the smaller contractors in the area and also some of the residents that have uh gone through the permitting process. Thank you. Yeah. Yeah. I uh I know that
uh like everything else on Highland Beach, um we we tend to be uh obviously we we try to be uh the best at what we do. Um, I know that
permitting and and turning permits around um is faster. I know most things are done online, but but uh you know, we can have that discussion with with uh Jeff and find out, hey, is there anything
else? The challenge is is that you know, when you've got an estimated, you know, three $3.4 4 million in uh you know in your savings account yet
your operating expend expenses are like $2.7 million right um uh that's just what the rules and the regulations are set by the state of Florida. It could what could happen
in the future. What we're trying to uh stay away from is if a contractor were to make file a complaint that says, "Hey, I'm noticing that your fees are that that you're charging aren't market
driven. They are market driven, but uh they more than enough cover your operating expenses. it could be a problem. So what we're trying to do is we're trying to we're trying to show good faith effort that hey in 2026 we're
going to start by we're not it's not a drastic we're going to start by lowering it by 12%. Right? And we're going we're going to see we're going to see what effects that that does u but investing in new better technology I think will
will also do that. Is it a matter of first lowering rate spending? Can we leave that fund quicker on value added projects? Where can we where can that money go? Well, right. We'll have to Well, obviously Jeff is is the uh and
and this is a good question that that the board can ask of of of Jeff. You're you're you're absolutely right. We can look at that. But I think right now we've tried to invest I know in prior years and this year we've invested in newer software. Uh you can see that that
we're looking at things here that they can that they can reasonably right it had right I can't have my building department buy police cars right you know I you know that that would look frowned upon although I would love to do that right or or have my building
department buy a new firet truck but so I have to relate it to something that reasonably is attached and associated with them but we'll look at we'll we'll look at uh we'll Look at that. But you can see that if I go back, right, what
are they at? Their 2025 budget, you know, they were at $2.38 million, right? And now 2026, we're anticipating them to be at $3.13 million. So, so we're trying to we're trying to spend it on building
related activities. Uh, but for now, we're going to approach it maybe on both sides, right? So we're looking we're saying okay if we can spend a little bit more if we can increase that spending which we're doing on building related activities and lower rates at least show
regulators that we are aware of it and this is the actions that we're taking. I think that that that'll pass muster. So David on Gfream. Yes. Uh the numbers becoming dramatically in our favor. If I
went to the detail. Yeah. Just curious. Uh this year we'll end up with revenue from them about $750,000. Yeah. If I'm looking at it right, it only cost us an additional there's one line item. I'm sure there's other things about $120,000. So any landing about a
half a million dollars. Yeah. The same is going to happen next year. Uh in the first year we did $400,000. So we're netting out a half a million dollars of real cash. Yeah. That's one of the challenges, right?
Very nice. So is where this increases. That's a very big Yes. percentage of the pro quote problem which it's not a problem that we have. Right. You know, you know, in most communities, um the building kind of uh fluctuates, right?
You know what I mean? you'll have high building, high improvements, and then nothing, right? And and building departments sometimes suffer because they're like, "Hey, we just we just ramped up expenditures and now the building stopped. Now we don't have enough. Now I got to start laying off
people." And so we're trying to do this in a phased approach uh to kind of ease into hey what can we show a reasonable regulator that you know what we're taking steps to do what is the the right
thing to do and so but you're right Gulfream that's when we started this we were hopefully it would break even right right and I think it was 2122 we started that was a conversation is are we sure we're
getting into something that's not going to bite us in the you know where but I'm just looking at your detail and I'm I read it five times and I said this is a nice little business. Oh no. And and again our our uh our former mayor uh he
he he he saw this he saw this that this is going to be a good thing. Uh and you know it's a perfect scenario actually. It's one local government helping out another local government that couldn't do what they needed to do, but we could
absorb the additional work. So, we have this model in the building department where we have a certain level of town staff and then we outsource to cap gov any of the overflow, any of the inspections. But I'll tell you that Jeff
is uh a unique person in that he he's excellent at what he does and he and he manages it extremely well. Something like this could fall off at some point. Yes. As the whole building department can. Yes. So we are very aware of that. So don't go out and hire 10 people and
Right. Yeah. So we're not Right. So we're not trying to increase expenditures with increasing personnel. Right. We're at a good level where we can maintain both. So we're trying to look at it in different ways. Well, like Richard said though, gives an
opportunity to improve the turnaround. Yes. On on what the department does. That's very important. And Jeff will have that data. He'll he'll be able to share with the committee. How like what is our average turnaround of our permit time? Where does that
where does that fall in line with others? So yes, there are those outlying cases where uh maybe some contractor, you know, uh problem with both, but you know, and just point of clarity, we we always thought it was going to make
money. There were people who didn't think it was going to make money, but Jeff at all said, "This is going to make money." Yeah. And there were people actually who didn't want to do this. I recall. Yeah.
Yep. I mean when that topic came to this group back then, this group was in favor of going ahead with it. Absolutely. Absolutely. I mean, yeah. When you can when when you can uh when you can cover your overhead, right, with your existing stuff and then bring on additional work,
uh this is Oh, and by the way, the reduction in uh the anticipated reduction in uh those rates will also apply to Gulfream as well. So, so we'll see. We're monitoring it. We have enough
cushion in this department to monitor it to see where it goes. And uh if it gets too skinny, we'll have to we'll have to readjust. But this is one of those funds that uh is particular about how much you
can keep in your reserves. So, that's interesting. You you're limited to the amount of money to put into a reserve. You just can't write a check of this. We don't need this cash in the building. Let's put it into the general reserve. No, can't happen. Can't happen. I've got to be able to show our auditors that,
hey, for example, I've got every year I've got to substantiate why the why the building fund sends money over to the general fund. And so what I do is it's just a simple allocation, right? I look at the general
fund expenditures. I'd look at a reasonable I think it was maybe 10 to 15%. I said okay the here is the overhead for the general fund. Let's assume that the
building department ranges from 10 to 15%. They need a 10 to 15%. They got to carry some of that cost. And so I've got to show that every who blesses it outside these walls. That's the question. Why can't we do it? Unless there's there's a big brother out there
saying you cannot do it. Yeah. Well, and the other the other hurdle that that that staff have to overcome is we have to justify expenditures that come out of this fund that are building related.
It's it's uh so so that's that's why I said before I would love to be buying police cars. I I would love for the building fund to uh to do all the sewer relining, right? But I can't use charges for service dollars that were
geared to building fund for water and sewer or for police. I can I can charge them an overhead rate. Yes, that's what I was going to say. There's something you could put in say they are getting a benefit and this is how we come up with
it. Yes. And that's what we do. And that and that's why we looked at it this year and we said, "All right, 500,000, let's look at 700." And that's why you can see there that, hey, that the building fund is going to send over starting in 2026 $200,000 additional. So
that's uh that was one of our attempts to do that. And we can justify that, right? We can justify that with the general funds involvement in Gulfream. We can justify that with the general fund's overall price increases and how
alls we're doing is we're adjusting that for inflation and whatnot. You document that what you're saying is documented. Yep. So you two years from now. Yeah. Okay. It's one of the audit requirements that when our auditors come through and
they see this, they they they send me they they say, "Okay, we need you to justify your reasonleness for this overhead allocation." And I I put together the same schedule, increase of staff, or just increase in costs in general. Now, you'll notice that we
haven't touched this. Well, look at 24, 25, 26 it'll go up, but it's been 500,000, I think, since 2023 or 2022, you know, so it's stayed that same amount. We don't look at it every year, and we're trying not to nickel and dime
it, you know, we're just trying to be reasonable and conservative. Yeah. Okay. Thanks. Yep. So, that's that's going to be a challenge, but that's a good question that that that the board can ask. Hey, is there any is there anything else that we can enhance that we can
spend money on enhance uh going forward uh the building fund uh expenditures on technology that would allow our residents as well as Gulfream to have a uh easier easier use of that
platform. Can I ask you a question? That occurred before I joined this board. In a nutshell, in a summary, what is that model that you do with GFream in case someone out there doesn't understand why we're making money on this deal? As I
don't Yeah. Yeah. So, GFream came to the town and please correct me if I have this wrong any any of the board members. GFream came to us um uh came to our town and said, "Listen, you seem to be able to operate a governmental building
department uh flawlessly. Uh we don't have that expertise." And so what we would like to do, and by the way, most governments do this. Let me give you an example. The Highland Beach has an interlocal agreement with
Delray Beach for our sewer. That's right. We don't process our own sewer, but we go into an interlocal agreement. They have that technology or that ability. And so when we looked at it, we they they came to
us. We're not trying to uh go out and solicit businesses, but they came to us and they said, "Hey, uh can what do you what do you think about this model?" And so we looked at it logistically. We said, you know, you're just right down the road. Not too bad. We can when we
can send people down there, we'll do that. We also have this unique model where for busy times and slow times, we can expand and contract our operations
through a third-party inspection service contractor. We do so much volume here that we are in a superior position to where we get to say, "No, we want that employee to be our inspector all the time. we don't
want you bringing in any Joe Schmo type of inspector that doesn't do a good job. And so CAPG gov said, "You got it. You'll always have this person here is on you and runs this route all the time." So, but anyway, so to make a long
story short, they came to us, we looked at it, they said, you know what we can do is since since the general fund uh can uh since I'm sorry, since the building fund the funds have to stay in
the building fund, uh Gulfream said and whatever you charge you keep because it's your building department to cover the costs of doing that. Now, we tried to match revenues and expenditures, but at the end of the day,
we run very efficiently. We always knew that there was going to be a surplus. We always thought that building activity along this beautiful stretch of land would slow down. Um, it just hasn't it just
hasn't done those two things. And so, so we entered into agreement. It seems like the agreement is going great. Both sides are happy. Both sets of customers are getting their needs met. And uh we're just at a unique situation where we're
sitting there saying, "Hey, um we're we're grow we are growing we're growing reserve dollars too fast." Oh, okay. And before this gets to be a problem, let's go ahead and take those steps
needed to show good faith that we're doing our part and we're looking at how to slow that growth rate down. Thank you. Yes, sir. doctor. No, I was just going to add I don't as
you say I think this can be a separate forum for these discussions but you keep talking about possible technologic improvements and it can be through I mean the goal would be to have value added services where this makes this town particularly special in terms of
interfaces with the building department just like it's special in terms of interfacing with the fire department or the police department and so on and so forth and that can be through technology obviously or it also can be through people, you know, and I know at the
hospital years ago and when I was there, I was opposed to it when I first heard it cuz I thought it was sort of like insulting. But you know, we developed a system of having uh whatever you want to call them, but like patient advocates because while many people can make it
through the complicated system of the building department or a hospital or any big entity just fine, some people can use a little bit of extra help, whether it's a individual resident who may not have the the person at the condo kind of
doing it for them, uh or some of the smaller contractors which I haven't been personally involved with this in a number of years, but I know in years past before Jeff came, there'd be certain like air conditioner guys or plumbers, small business, you know,
family business type people who just say, "I'm not pulling permits in Island Beach. It's like too big a problem to get through. It's not it's not worth my effort." And then you'd end up going with some big company which could afford to have three people or whatever in the office just filling out, you know, doing
the documentation for things. So, you know, my thought would be, and again, I don't know that there's anything to be done. We may already be the best department in the world kind of thing. Uh, but if there is, it would be something that we could look at. And again, I don't normally recommend
looking at spending more money, but in this instance, fortunately, they've been hugely successful and they might be able on a pilot project to if there's any opportunity to try it in order to make Highland Beach even more special than we
already regarded as being. That's all. And it can be through technology, it can be through something else. And I agree, this isn't the forum for it. It should be a separate separate place. Thank But in that same line of thought is um what the 513 days is driven by our cost
divided by revenue, right? Yep. Well, our revenue divided by cost, right? Yeah. Yeah. So, um is there a way to put in line with the additional services? Um can we add people to the process
to knock down to 513 days? Cuz I'm the kind of guy that if we have a revenue stream, I hate to give up a revenue stream. You know, revenue is revenue and what's fair is fair. And if the ratio is the the the days of cash against what we're spending, I think we
spend more money and add services versus cut our versus cut our fees and make services the same. I think I think we have an opportunity here to think outside the box and for the building department what can be what is what are the boundaries of what a
building compartment a building department can do. Sure. What are those boundaries and what are the services that could fit within the confines of a building department and we've got this ability here with this money and we have you know an aging population. I'm my mind's going to like the town I grew up
in. Our folks never had to take their trash out. They had the trash department went into the yard into the facility, took them out, dumped them in the trucks, and put them back, right? They shoveled the sidewalks. We had excess funds in our town. We we we bought equipment to clean
side. So, what do we get a piece of equipment through the building department that could sweep the bike path, that could sweep the walking path, things like this? I mean, thinking outside the box a little bit. Yep. Yep. No. And and uh Yeah. No, we'll we'll obviously uh you know, we'll have Jeff
uh uh come and and and and talk not only to us but also to the to to the board because these comments obviously will be brought to to our board uh to to look at that. Um you're right. Um you know, there are fine lines, right? And and so
when you talk about sidewalks, let's just say automatically my head goes to, well, that's general fund public works, right? You you know what I mean? And so, yeah. Yeah. Yeah. No, no, I get it. Right. Right. And so, and so those those are kind of the challenges is how can I
attach that nexus to how is this a building fund? Maybe it's uh I know for example, let me give you an example. I know for example, Jeff wanted his own boat because he's like, well, wait a second. Can I go? Can if some of the
single family homes are along the canal and I want to see what about and so again the bottom line is three years ago we didn't we knew this was going to be successful right we just didn't realize that it was going to be this successful
and so right and so at the end of the day alls I think alls we have to show is we just have to show that are we monitoring it and what steps are we taking to address our reserve balances in this fund. As I
said before, you know, maybe maybe the answer is, hey, David, look at the reallocation. Maybe $700,000 isn't isn't isn't uh enough. Maybe we can go to 8 or850, you know, or whatever just to be reasonable. Uh but we'll we'll we'll
look at all those all those things. So, Harold had a question. Um so our relationship with with Del Rey in terms of them supplying us fire services
is that fall under the same category as you know like the building department to us you know us with that's a general fund. Yeah. that. So the general fund is is the fire and the police and and I mean so when Delray was providing
services to us were they supposed to not make a pro you know is it a similar thing? Yeah. Well, see, general anytime a local government, it's not a fast rule, right? And it anytime a local
government provides a cost of service, right? They should provide you with a cost of service study, water and sewer, why do you need to charge this much for what you're what you're providing?
Right. So, this it is the same thing sort of. Yeah. Well, now with the fire department, that was an agreed upon amount. Yes, you assume that the other party uh has done that calculation. And typically when it comes to fire, you
know, you're talking about trucks, you're talking about FTEEs, you're talking about training pension costs and things like that. So, it's a lot more invasive. But at the end of the day, uh, yes, when a town provides a a service to
its residents, it should be matched by some type of reasonable cost of service. It doesn't have to be anything elaborate or anything like that. You just want to be able to show, hey, this is what it costs us to provide a permit. This is what it costs us to run the building
department, and this is kind of what our fees are based on. And so the unique thing about this is, think about this, building departments can turn relatively quickly, right? And next thing you know, you have all this costs that you're
still supporting. A lot of times it's the other way. The general fund is supporting the building fund through transfers out to the building fund. This is one of those situations where this
would be a totally different story if we didn't have Gulfream. We wouldn't be in this position this quickly, right? But at the end of the day, this is where we're at. And I think we just have to show we've got to come up with, hey, what else can we do? Can
we maximize our level of service to justify our costs? Um or is it a is it a uh is it an effort of doing three things? Increasing our direct cost right
through enhanced services, increasing the allocation that the building fund sends to the general fund and maybe not lowering rates by 12% but maybe lowering rates by seven or 8% or or what have you. So we'll have to we'll have to look
at that balance just to show that we're doing our part. So what were we saying? It seems that the Gulf Stream has become a major player in the operation of this
building. Yeah. If you take them out of the equation, I'll stop there. Yeah. I mean Yeah. I mean it's now think about it. if we take them out of the equation. Well, we structured it so that just changes our variable costs, right? And
so if I lower my revenue, right, then my variable cost of outsourced inspection services will lower as well. So, but we'll monitor that. It's a good problem to have and we'll look at every aspect of it. But this is Yeah. I mean, uh, you
know, you look at it and you go, "Wow, you know what? That's more than enough money to cover our sewer lining project. Yeah. Unfortunately, can't touch that. Has uh I was just thinking about the Has anything happened with the reconciliation with Delray? No. Nothing.
No. You know, that's still in uh litigation. Yeah. So, but anyway, so so this is a good problem to have. Uh but we're working on it. We're aware of it. We haven't yet settled on a a concrete plan. We're floating around
ideas, right? But we're trying to do everything we can and and again, this is a preliminary budget. We'll look at we'll we'll we'll we'll take another look at and we'll have Jeff more involved with, hey, long-term, what does
the next five years look like? Um and um and we'll also have him bring to us what the Florida statute that limits that amount of money that you can carry forward year after year.
So, uh we only got two more funds to go. So, this is your your water fund, your water revenues, right? So, we're anticipating that our rates will go up 5%. Um and uh again as anything else charges
for services dictate how much revenue this fund gets. Um we are uh the next slide here this is gallons this is usage data. You can see
that we have two types. We've got water and we've got irrigation. And you can see that historically right now we're up about almost 3% versus this time last year we're up 3%.
In in uh consumable water, portable water. On the irrigation side, we're up about almost seven and a half percent comparing this time comparing this year
to this time last year. And so those are good things. How is that driven? Well, we're investing in more accurate meters, uh, which always help. Um, but, uh, but but at the end of the day, the the Now
here here's the dollars. Now, alls I'm doing is I'm converting my gallons. And by the way, these are in thousands of gallons. So, when you see 40,000, that's 40 million. So, there's a lot of water that that goes through this
town. Uh, as well as also on the irrigation side. Uh but you can see that on a revenue side of life, revenue is up by 11 and a half percent on the water side and on the irrigation side it's
almost up 16 over 16%. Now that's a combination of an increase in rates and an increase in consumption. Okay. Um, Highland Beach is very seasonal and you can see the seasons there and uh as well
as it's very much affected to the fact of rain. Right. Right now it's it's been kind of a a dry season. All right. And so the less rain a community has, the more people have to irrigate, the more expensive it gets. Uh but overall you
can see that uh that our expenditures right our expenditures personnel services operating expenditures capital outlay uh and uh we increased a little bit uh there for our contingency but overall
we're anticipating that our expenditures will increase about 6.2%. M you can see the dollar bill down here, the stretch of it that it does seem to be nicely allocated to where you know a third a
third of your expenses are labor and related, another third of your expenses are operating and then another third is capital debt service and and transfers. Now this fund here when you see those
transfers there of five of 500,000 right those transfers there that's going to the sewer fund and so because there is this correlation between water and sewer sewer doesn't have any employees the only thing the sewer has is an
interlocal agreement with the town of Delray Beach to treat our sewer. Let's look at what the debt is on the water side. You can see here. Can I just
ask a question? Yes. From a accounting standpoint. Yes sir. Why does sewer have no employees? I mean I know they don't directly hire anyone but I mean they have people who work for the water department or public works or
some combin and general fund people and everybody else that right are involved presumably. Yeah. Why isn't that a Why isn't that a thing from a from an accounting standpoint? Uh I don't think it's much more I I don't think it's an
accounting standpoint as it is uh operational. Um, we have I think we have six lift stations right in the town and so our water people will go out and
inspect those six lift stations. Okay. Uh allocating staff to the sewer fund uh because we don't have any treatment. The only thing we have is we have a collection system. So in sewer there's
treatment and collection and so we only have half of that and and we do that through the lift stations. They check the lift stations but it's very minor as far as dayto-day stuff. If a lift station were to go down or need work, we
would call a third-party contractor to do that predominantly because although our operators are typically dualcertified both in water and in sewer, uh the predominant cost that the
town has is making of the water and storing of the water and distributing the water. the collection side is uh that's done obviously by gravity and that's also done by the lift stations to
get it done there. So you know but overall you can see that our debt in 2022 and 2023 went down in 2024 and then it went down in 2025. Now, it's
going to stay that way until 2029 when the Bank of America debt falls off. But look at these interest rates, right? I mean, you know, this one here is at 1.18, 2.64, 2.82, 3.41.
So, the the interest rates are are still good and attractive, but the next time that we have a a reduction in our so-called mortgage payment is in uh 2029. Yeah. And so now, let's look at this
fund. Let's look at what what uh what uh capital projects they're going to be doing this year. They're going to be doing the mezzanine walkway. They're going to be doing their steel beam reinforcements. We're going to be doing well number eight improvements as well
as the acid tank replacement. I always tell people the only thing that beats the cost of owning a boat is running a water or sewer enterprise fund. It's very maintenance
and capital intensive and especially the fact that we live so close to the saltwater. Okay. And so so things need to be maintained. But what we're doing this year is we had 144 days of
operating cash. We're going to spend out some of that cash in this year because what we've realized is like you have things just tend to get more expensive, right? And so at the end of the day, we're our goal, we're fine with dropping
our estimated cash reserves down to about 60 days of cash. Uh because number one, we always have the general fund, right? That is a backs stop, but number two, we have to get to these capital
programs. Number three, we have to balance everything with rate increases, right? I don't want to increase rates just to have a little bit more cash reserves when I don't have to. And so, uh, so that's kind of what we looked at
as far as balancing. We know that we've hit the residents high with water and sewer charges. We we we're aware of that. Uh, but we have to balance things out. And so we're going to try to get to all of these capital projects
and it's going to drop down our our estimated uh unrestricted uh number of days of cash. Uh but the good news is is that people can only live seven days without water. So, we feel like we're pretty comfortable with uh with with
with dropping that down right now because the general fund has enough girth that if the water fund ever needs anything, the the general fund can step in its place and and act like a big brother. I mean, it doesn't look like looking at the graphs, it doesn't look
like our any conservation program uh didn't seem to work. And uh you know, we're charging a lot more. Obviously, we're going to be doing some things with the money, which is nice, you know. Yep. Yep. And I got to balance that, right? I I you know, I got to
balance that with the fact that, you know, you've the last three years you've come off double digit increases, right? And and we've also we've also got helped we we also helped when our debt service got dropped too, right? So, all those things. So, you can see here our our
debt service dropped off. We raised rates. We're getting a little bit more comfortable. we just got to go ahead and handle these these these major these major uh capital items in that fund and eventually
we're predicting that 54 days is the low is is the lowest point from this point on we will just continue to grow the the the days cash in in this fund. Do we excuse me? Do we know what the
sewer lining project is going to cost yet? Yes, we'll go into that next. Okay. So, here's the sewer fund, right? Separate fund, right? Uh the sewer fund, uh we're going to be pulling money from instead
of doing a bank loan, right? Instead of doing a bank loan, um, we're going to pull money from the sewer funds excess reserves. That's why we're pulling money. We're doing appropriation from reserves and we're going to bring that
into revenue to pay for the major sewer line. And let me get to that right there. Let me get to to answer your question right here. It looks like it's right now it's about 1.750 million to do that. We've had some challenges
obviously with the road work that's going ahead. I know that we were throwing around numbers between $2 and $3 million. I know that we were looking at state revolving grant funds that were at a very low interest rate. But a lot
of times in doing those it delays the process, right? If we have the cash now and we have the contract and we have the contractor, let's go ahead and let's start executing this on the smaller streets while they're getting done with
that with that road work. But that's to answer your question. I mean, that's a big in other words, I lose track already, but I mean, when we went to the residents to get approval for a sewer project, we were talking about $3 million. This is coming in at
1.75. That's a significant uh all good news obviously. Yes. Obvious. Yeah. Yeah. It's a significant difference. Right. Right. How did that happen? Well, I think that's happening because I think inflation is settling
down, right? I mean, we had doubledigit inflation many, many years ago. I also think that contractors were privy to the fact of how much every town got in ARPA dollars. And so, and so when a contractor sees
smartly that, oh, you got, you know, with $2 million of ARPA funds, how much is this project going to be? Well, it's going to be $2 million, right? Because we we want to grab all those ARPA funds. And so I think that we've because we already know we already have the
engineering side of this project done and and it's ready. It it's what we would call shovel ready, right? We know that contractors are starting to be a little bit more competitive, right? Uh the days of just ask ju just
set your price and and forget it are are gone. I think people are being a little bit more competitive and uh but but right now we're we're pretty we're pretty solid on that number and we don't have to wait necessarily with the main road A1A that we're going
to be interfering with. We can start on the side on the side roads. Are you going to be tearing up the roads again? Uh I don't know the answer to that, but typically it goes between uh manhole and manhole. And so what I want you to think is they go in one
manhole and they go to another manhole and they put this liquid down the pipe and then what they do is they inflate it. It's like a balloon and then that
composite material adheres to the sewer, right? And makes that new pipe from inside out like brand new. And so that that's the technology that's there. Uh now here's the good news. When you do a
sewer lining project, your treated sewer costs typically go down. Because if you think about it right now, as water as as uh tides start to come in, the cracks in our pipe, we're treating salt water,
right? And so what we're sending to Delray Beach is a combination of sewer as well as salt water. So when you line your pro, when you line your sewer sewer pipes, now you're just getting pure
sewer. And so typically your cost per thousand gallons drop your your overall cost drops down because you're not sending as much volume. And so that's that's a good news. What is the useful life once they finish
the project? Is it what they warranting? Were they guaranteeing or I don't know the answer to that? I I don't know. But it's it's like a fiber. It's like a fiber glass. It's it's been around. I will have to get back to you. I I don't know the answer to that. But it's way
better than digging everything up and putting new Agreed. Uh I mean it's it's night and day. And so um and so yeah. And so, you know, the idea is, you know, it used to be, you know, a million dollars a mile. It's probably a little
bit more money than that, you know, to to to lay to lay sewer lines, you know, that that was the the rule of thumb, you know. Uh but but I think with this right here, I think you can get crews in there between the manholes. They can knock out a section, wait till it dries, harden,
uh, and we move on. A lot of times what you have to do is you got to re you the the main problem is you have to uh refflow the sewer that's coming in, right? Because I I can't be lining these two points, right, with with sewer
coming in, right? And so I I I've got to So that's some of the challenges that that they'll do it. But the technology has been around for a very long time. I would say probably 20 plus years. So it's been tested. It's been tred. It's become one of those when are you going to get around to it sewer lining
projects. So it's very effective. We we'll be long gone. No duck duct taping and that is a possibility. But anyway, so again this fund here we're anticipating a 5% increase in the rates. Uh we're going to be spending money on
the sewer the sewer lining lift station number two. We got grant funds. we did from Peggy uh for for our uh for some of our lift station work. Uh so that's always that's always a good news. You can see right there uh grant funds
$230,000 uh we got um and so that's that that's always that's always welcome. Uh as with water, you can see sewer sewer tends to mirror water. Um and so you can see obviously the increases in both. That's
normal. Um and the main thrust of this year is going to be capital outlay, right? And uh we're going to uh use excess funds, excess reserve funds. So we're going to drop down from 417 days
of cash to about 125 days of cash. But after that this major this major sewer lining project we feel that 125 days of cash that'll be the lowest level that we'll see and we'll just build from
there. So overall uh this right here is a summary. So if you see here this right here is the source of funds right up here. So this is the revenue side of life. So this is the source of funds and these right here
the columns are all your different funds right and so you can see that hey line 12 is total revenue right line 14 is grant funds line 15 is those interf
funds from the building to the general fund from the water to the sewer from the sewer to the the water or the general fund That's what all those represents. And then you can see here, line number 16 is from reserves. So,
right, I'm pulling money in. We tend to only look at a snapshot a year in time. And so, we sit there and we go, okay, how am I matching if I'm going to have I'm on the expense side now, the use of
funds. If I'm gonna have a $ 32.5 million budget for 2026, right? If I'm gonna have if I'm going to spend $32.5 million, where am I going to get that money from?
Well, you go back to the sources of funds. Here's our sources of funds. Now, sometimes we use from reserves to plug the holes, right? So, we sit there and we say, "What money is going to be coming in this year?" And if we don't
have enough, we tend to pull it from excess reserves just like you would do with your savings account or or or what have you. Uh and and so that's our goal is to use some of excess reserve funds
to tackle capital projects. And that's that's the theme for uh for for this year. Um, so reserves after all this will be $8 million. Yeah. Well, you got to go by fund,
right? And right because you got to look at funds. So, let me give you an example. So, the sewer fund, the sewer fund after all this will be about $685,000. The uh the water fund after this will be
about $674,000, almost identical. the the building fund, you remember we talked about that? That's going to be 300 $3.4 million. The um the discretionary sales tax we
plan that ends, as I said before, so that's going to go to zero. And then the general fund, we're looking at about uh uh uh $8.7 million, but only really $2.8 million of that is unassigned. So, so
still going to be healthy, right? Very healthy. We're trying to do the prudent thing by keeping cost low, but also not push so much cost on to the rate payers uh by using excess reserve dollars. And
we think that 2026 for those water and sewer funds, those are going to be the that's the bottom end. From then on, we just we just continue to grow grow our reserves back just like we did with the fire station. Remember, you know, the fire station, we were like, "All right, this is going to we're going to build
this. It's going to be 8 to10 million or whatever. We're going to pull $4 million from our excess reserves and we're going to borrow $5 million." And so, uh, that's always been the goal with, uh, with our budgeting is in good
years, let's store the money. uh let's not lower the millillage. Let's store the money for capital improvements as well as a hedge in thinner years. And uh this is the year where we say, you know what, we're going to start using some of
that excess reserves and we're going to reinvest in the town's assets. I have a question. Yes. What uh monies or grants has Peggy uh Gossit Seedman provided for this town? just so we go on the record
and acknowledge the way she's been working for us in Highland Beach. Yeah. Uh she's done a great job. You you have to understand that uh to Tallahassee for the zip code that you're in to to
get any type of appropriations is uh is incredible, right? because uh believe it or not, there are other towns out there in much more need. But uh uh yeah, she was able to get us I think this is the second or third year that she was able to get us, you know, the 200 plus
thousands of of uh funding that we needed for some work on some of our lift stations. Now, the town is blessed with great residents that uh that uh we would never let anything get in disrepair
shape. This year, we're focusing on obviously the fire old fire department building. What we're going to do with that, we're focusing on the police marine facility unit behind us here. The one challenge that we have Peggy have
any um anything to contribute to that to the the marine uh the doc? Not to my knowledge. Not to your right. Yeah. Not to my knowledge. Uh uh I I I I thought she did. I don't I don't know. I'm not sure what made it through the budget. And then we're still not sure what the
governor is going to let through with his line item veto. I know we lost something last year with the line veto. Uh I think she got I heard that yesterday. Well, yeah, I'm I'm I I'm not 100% sure, so I don't But it is possible. I know
that they're looking at what they call a fine grant. Um Fi NE grant. Uh but but I'll I'll find that I'll find that out. Anyways, I just wanted anyone out there to know she's been working so hard for us and it's appreciated. Yeah. No, absolutely. Absolutely. Thank you. So,
let's look at what this next process is, right? So, we have the FAB meeting. That's where we're at today. July, uh, what we'll do is we will, uh, do an official not to exceed maximum millage rate.
August, if needed, we'll have additional budget meetings. Okay? If there are any major changes, uh, but we're all trying to hit the September, right? So September 2nd at 50:01 is when we'll have the first
public hearing and then September 18th at 501 we'll have the second public hearing to establish our budget becoming effective October 1, 2025 to go into September 30th, 2026.
So the main thrust of this budget year is let's focus on using excess reserve funds to enhance needed capital work as well as cover
those those normal operating type of expenditures. I think we have one outlier and that's the and that's the building fund really. What what is our long-term plan with that and we'll we'll get the committee back that that information as to what we can and can't
possibly do. Yeah. Excellent representation of our town. Yeah. Uh yeah, it's Thank you. It's phenomenal. It uh the but you know you know it always wasn't like this, right?
And so it's uh we've really uh Yeah. And so Yeah. Yeah. And so again, the town continues to do five-year budgets. We tend to look longterm. Uh we tend to set out a plan and um and
this town is uh is concier service to its residents, i.e. because because the residents are paying 73% of the of the bill. you know, you should you should get the absolute best that's out there. So,
um I have no no problems with the budget and I appreciate the presentation which as usual was excellent and answered questions. Um, I wonder if in the future it might be possible for
you to present to us what how we should be approaching if there's a a policy or anything in terms of how one deals with large capital expenses. And by that I mean items that are over a million or a couple million
dollars and are expected to be the kind of capital project that's going to last for 20 years or thereabouts in terms of when it's reasonable to seek financing because you look at the kinds of loans that are available to us and they're typically not the kinds of loans you can get as an individual. I mean,
they're really low interest rate loans versus when it makes the most sense to quote, as you say, take the money and just pay as you go out of capital reserves. And again, I'm not I'm not talking about buying the police a new car for 50 grand that you just put in
the annual budget as a capital expense. I'm talking about the big items like like the sewage project. And, you know, we may not have any on the immediate horizon, but we will in the future. And I mean, I've read a little bit about all this stuff and what other communities do
and what the best practice is, but it's sort of it seems to me that we don't have like a real policy as to that. I know that the commission now I have no objection to this because I think it's it's fine. Commission now is really big on, hey, we got some money, let's go just pay for it and not worry about
debt. Uh there are some people that actually feel that that's not necessarily the only way to go on long-term capital projects. So I just wondered if uh I don't think we have a policy now. I think it it's up to what you recommend
in the commission. It always will be, but I wonder if you could talk to us, maybe educate at least me. I don't know how much everybody else knows about it. uh as we move forward and we come across bigger capital projects if there's a sort of a system that should be followed
in terms of how we approach it rather than I don't know I like to have processes for that as opposed to just uh you know like compare the interest you could get on the money that we have in reserves versus the loans we might be ahead of
ourselves. Yeah. Uh, no. And and the doctor is is absolutely right. Uh, theoretically, if you have a longer life asset, you know, you you probably want to match that up with a
longer life loan, okay? And especially when when a community has available to them less than one less than 1% interest on on a loan, you know what I mean? Um I
think that um we decided to go this route. It was more of timing. We we but but in the future to answer your question, doctor, yeah, we'll uh we'll definitely we'll definitely uh we'll we'll bring that up to to to to Marshall
and management and the board if if they want something like that. Uh you know, uh we had just come off the fire. We're now starting with the roads. We were looking logistically uh cont the the amounts that the
contracts were coming in seemed to be really really high because everyone saw that we were flush with this new ARPA funds, right? And so they and so there were all these differentiating issues that when we sat there and we
said, "Listen, uh how much can you do this for? Just pull the the trigger. let's get it done with because it's like any other problem. It's not getting better over time. And so um and so when when we
looked at that and we finally got some numbers in, we said, you know what, we could start doing that. But going forward, what we're trying to do right now is we're trying to accumulate monies to buy future fire department equipment.
That's going to be ongoing. That's going to be expensive stuff. You know, I these things are when an ambulance cost you a million bucks, you know, it's it it's it's pretty tremendous and the lead times are long.
So, but we are but what we're trying to do is we're trying to fund almost like a syncing fund where we started with $250,000 and things like that. So, we want to be more prepared for that because number one, we don't know where interest rates are going to go. But long-term thinking, especially with your enterprise funds,
when you have those funds that charge us for services where we can set a cost based on an expenditure because we have a loan that we need to do this. As I said before, your water and sewer, you will typically not become debtree
with those because they just continue to cost a municipality a lot of money in repairs and maintenance because of the corrosive nature of of things. But, uh, we will take that suggestion and we'll see what we can do. Back to the cash on
the, uh, building building department. Um, we know that FPNL is going to raise rates. Yep. They're gonna probably settle out around six and a half to 7%. So, I saw there was a chiller project for the one building. Why don't we do an
energy efficiency project across all buildings for Highland Beach and upgrade all of our HVAC equipment to energy efficient equipment? Upgrade all of our water consumers to energy efficiency. do it under the opices of energy efficiency and take that money out of that fund
versus typically those are those are projects that are loan based and if we could do that we could maybe knock down that 516 days put everything back into our buildings proactively you know uh higher sear ratings on our on our RTUs
you know better water efficiency throughout the whole city so that's a way to maybe utilize some of that cash through the building department and I have just one other request possibly for a future presentation not regarding today's
is I would like to get some feel for what the uh marine patrol division of the police department is actually costing us. I was a big big proponent of that for safety reasons when it first started. I think they're doing a good job as best as I
can tell. Although again, I don't know what they're really don't have many benchmarks or parameters of what they're doing, but you know, we're now being faced with an additional fairly big capital expense uh for their dock. Uh obviously up until
now, we've been kind enough to have it docked at one of the condominiums, but I mean, they need their own dock for obvious reasons. Uh but I'd like to know in terms of you know operating how many people are involved the cost of maintaining the boat all that kind of stuff just to and again my personal bias
would be that whatever it is it's very worthwhile. Yeah. But I'd still like to see that as a carveout because it's one of those new value added services that we've had in the last uh yes five years to make a special. It would be nice to see how it's uh how it's working out.
Okay. Absolutely. Okay. So, well, we had the the revenue. Yeah. So, what so what you're looking at here is right, this right here is through the month of May, right? So, I think we're at what 69%
of the of uh so October, November, September, January, February, March, April, May. So, this is eight months of the year. And again, this is kind of what you saw on the last slide. This is uh where we're at right now. You know, you can see that
uh revenues like if I'm uh if I'm on page one, I'm on page one of this of this handout. Top top line, line number six, you know, right now our our revenues are are are very strong because we do get frontloaded with our property
tax dollars. Uh line 12, miscellaneous revenues continue to to exceed budget. Um uh o overall line 34 you know what we're about 19% over all funds we're about n we're the
revenue side we're about 19% uh greater than what we had in anticipated. Uh, and then if you go down the expense side of of life, when we compare that to the budget, you know, we're about 12% under under budget right now through uh
through the month of of May. Um, now what this compares this just compares our actuals to where we should be at the budget based on a straight line methodology. Okay? So alls it takes is it takes your
budget, right? multiply it by seven and times 12 to get what the budget to May should look like and where we actually at. If I turn the page, so if I turn the page, this right here is actuals by fund. So lines number 1
through 18, these right here are all your sources, total sources of revenue. There's the general fund, the discretionary tax, the building fund, the water fund, and then line 19 through 31, these are your expenditures, right? You can see that uh you can see that,
you know, right now, you know, uh 46% of your total expenditures are public safety. Uh you can see that we're still turnurning away 14% line 25 is capital outlay. Uh and then you can see there
you could also see that lines 15 and lines 30 those are the transfers between the all the different funds. Right? So you can see that and then lines 35 through
41 I just break down what the transfers are for. You know, you can see that from the building fund to the general fund, from the water fund to the general fund, or from the sewer fund to the water fund, or or or what have you. And so,
you can see there, those right there are all the different transfers that we do to cover if it's overhead to cover the building department's portion of of zoning and and review activities and and
things like that. So, so we really try to be fair across all other funds and be reasonable in any type of allocation. But so far, as normal, uh we're uh we're under budget on our expenditures and a
little bit over budget on our revenues, which provide us to put more money into reserves to meet next year's capital. And so, uh so yeah. So, so, so that's kind of the the the overall of what
we're what we're looking at through May. So, but as you know, the straight line method for us doesn't work and it doesn't work especially for ad valorum taxes, right? Because because what happens is is uh what uh December
probably in no November, December, January, I get most of our most of the 73% of our revenue coming from from the citizens, you know, we get right away and so but it does have to last us throughout the year. I'm just commenting
on the notes under budget, over budget. Yeah. Well, it's uh more of saying it's based on it does not work because it's based on a 12-month average. Yeah. Yes. That's exactly. Exactly. Exactly. So, just one comment. Are we going to be
able to see the conceptual design for the marine boat dock and what they're going to do in the firehouse? You know, when we uh voted and they approved it, is that coming soon? Have they hired somebody or I I don't know the answer to that. Where
are we on that? You don't know, right? No, I I I do I I don't uh but I know that they're they're they're working on and even in addition, they're working on a design for the old post office, right? And what the police department is going
to look like in the future, right? And so, and so we're, you know, we're we're working on that. A lot of these things obviously like any any project there's a lot of initial planning up up front engineerings architecture and then we get the the dollar value and we fall out
of our chairs and then we kind of regroup. Wouldn't it be nice if the old post office could be like a place where people could pull their permits? Like a little designated easy area to go in and
you know for getting a permit to do something to your house, use that instead of police. They're making those decisions. Yeah. Just an idea, right? Now, you know, the two superpowers in any town, right, are the police and the fire, right? So, uh,
uh, right. And so, you know, we look at we look at the fact that the building department has a nice facility. You obviously have to walk upstairs, but I'm sure that people will walk down. Maybe there's a kiosk service that they can have, but but I'm not sure. U, but yeah.
So, um, so I I think the building department is good. It's in a good location, but I I don't get to make those decisions right now. our police department is uh we're we're looking to to kind of upgrade that and we're trying
to see okay can that be for some type of other enhanced service to our community for police related activity. Matter of fact, the dock is also going to be used by the fire department, right? You have injuries on the water there. We need to
get stretchers out there and that's why that dock is not just going to be your normal everyday dock. That dock is going to be built to the nines. Yeah. Plus, you may have to put Jeff's boat there when he gets Well, well, I'm just saying, I'll be honest with you. Two years ago, I thought he was crazy
and asking for that, but I'm telling you, you know, he but he made a good he made a good suggestion and that, hey, I got to get around to these properties, you know, how about if I just go if a place is on the There's that Jeff guy again, you know, spending money like now as long can use the boat. I mean, my jet
ski a drone. Drone would be less expensive to see properties. Now you're killing the party. I'm not I can't go out on the, you know, in the water in a drunk. Let me ask you the the question I ask you every year. Is there anything
going on that concerns you? No. Uh, again, I I wish I had a better answer. Uh, that's a good We like that. Yeah. No, no, I agree. you know, uh, we spend well, no, I mean staff spend time especially with the manager and with the
commission and with you and we thank you for your time and and your input. It's invaluable. But Island Beach is uh just very unique. You know, when you come over those bridges, this is uh it's like the Wizard of Oz movie where it goes from black and white to color and uh it
just runs well. uh we have a great manager, we've got great commission, great subcommittees, and uh we're just we're in uh a very great season right now. And what we tend to do is we tend to write we tend to
squirrel away in the good times, right, to see what's going to happen next year or the year before. And um but yeah, uh it's it's a beautiful community. We were and we might possibly go up in the ranks. I think we were the third lowest
millage rate for the town on coastal communities. Now, we'll see what other communities are doing. We may go up uh to number one or number two. And when you're talking about the services that
the residents pay for, there's no doubt the residents pay for this. And it's because that's what they want. And uh so it works perfectly that way. And so it's uh it's really a concerted effort on how government municipal government should
run. So well if we if we you know get up to where Del Rey is you know they're running things really well over there. Anyway, okay. So um thank you. Uh any board members um
say um so we're going to My only comment would be maybe David can pass on to the commission that no major concerns were raised at this meeting with uh assuming everybody agrees
uh sir with the planned budget for this year. Yep. And I'll get with Jeff and uh we'll figure out uh alternatives, but I know that Jeff and the town manager have looked at various scenarios, but we'll but we'll see what uh what else is out there. But you can see that our hands
are tied, right? You know, I I gotta show that I'm doing something. Marshall likes to spend money, too. So, it's not it's not a problem. Okay. So, uh, we're going to close for, um, July 4th
and, uh, then we're going to have a special magistrate hearing on July 8th at 1 p.m. And then a planning board regular meeting at July 10th, 9:30. And then on July 15th at 1:30 is
the next commission, town commission meeting. When's that? next week and we don't have one scheduled. Well, it is summertime. So, summer, you know, we had to do this one to get the thing bullet time. So, anything else
from anybody as a meeting is a journ. Thank you. Thank you. He gave always educate