for a workshop on budgeting. Uh it is uh 3:04 p.m. on uh Tuesday, July 14th. Um if you'll please stand and do the pledge of allegiance with us. >> I pledge allegiance to the flag of the
United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Thank you. Uh, city clerk, would you please do a roll call? >> Commissioner Marriott >> here.
>> Vice Mayor Robinson >> here. >> Commissioner Cosy here. >> Commissioner Maldonado >> here. >> And Mayor Tate >> here. >> We have a quorum. >> Okay. Um, we have an agenda here which is all about work session and we've got a series of presentations. So, I will
hand it over to city staff. First topic is reclaim water. I understand. That's correct. So, good afternoon, U mayor and commission. Devon Schmidt, finance director for the record. Um, this afternoon, we're very excited that we have Rafelis with us um to present to you our enterprise uh fee
studies. And so, with that, I will turn it over to Shawn. I did want to just give a quick shout out and thank you to our public services team for the information that they pulled, our finance department, and the city manager's office, Kathleen Murray, for all of her work in getting these fee studies pulled together. There's a lot
of data that goes into that. So without further ado, I'll pass it over to Sean. >> Thank you. Really quickly, I think there's a note from our speaker that we are muted. If I could get some technical assistance,
Sean, can you hear us now? Wait a second. Can you hear me? Okay. >> Yes, we can. >> Can you hear us? Okay. >> Yes, I can hear you now. The the the introduction was uh
>> you have been introduced. So, you're up and running. And would you like to share your own screen or do you need help on our end? >> Oh, uh I'll share my screen. Okay. Okay. Is it coming through okay for everyone? >> Yes, you're you're good.
>> Um you good afternoon. Uh my name is Sean Oacio. I'm a senior manager with Reptiles Financial Consultants. Uh I've been working with the city when it comes to the uh reclaiming uh water storm water and wastewater retail revenue efficiency study as well as wastewater connection fee study. Um and I've been
uh you know overseeing the the analysis and uh working with the city's finance and and management team in order to develop uh the the financial forecast and everything that we're going to be talking about today. Just as a a quick uh overview of the the study itself in the presentation. Again, we're looking at the the revenue
sufficiency of the reclaimed water system, the storm water system, the wastewater system. We're also looking at some uh rate design on the wastewater system side, as well as an update to the city's wastewater connection meetings. Uh in terms of uh overall goals for the presentation today, uh it's going to be
an overview of the major tasks uh goals and considerations for this the various study for each analysis and then a review of the summary findings and recommendations associated with each analysis. Uh one thing I I do want to mention uh if there's any differences in between the
the handout that you're viewing and the slideshow on screen, there were a couple of minor updates that were done to the slideshow on screen. So there may be just a couple of slides of difference but overall the the content itself is the same. So we we'll first start off on the the
revenue sufficiency side. Uh one thing I wanted to mention here is you know uh presently the the city's um reclaimed water storm water and wastewater uh revenue funds are reported as enterprise funds for financial reporting purposes. So what what's the
important statement there? According to Gatsby, you know, essentially a a utility enterprise fund, any enterprise fund has to be operated in a manner where the rates and charges um for that uh fund and service provide for the covering of all the the cost of operating.
And in this case, when it comes to your your um your different utility funds, um anywhere between 95 and 99% of the revenues associated with those different enterprises come from your normal recurring uh utility service rates. So
why is that important? Because what that means is that's the main uh lever that you have to pull when it comes to improving the overall financial position of the various utility systems. It's it's adjustments to rates regularly. uh degree that your cost structure for the
various utility funds is is a fixed type item. So again the biggest tool you have in order to improve the financial position overall is a rate than the other. Um in terms of the major study tasks in our overall approach for the revenue sufficiency analyses,
essentially what we're doing is we're trying to develop a forecast to project operations for the various utility systems. Uh that's including balancing your rate revenues, any connection fees and other fees balanced against cost of operating the system,
any debt related costs, uh capital in order to maintain and improve and expand the system as well as any inter fund transfers and so on. So that's kind of the dynamic that's trying to be balanced here. And what we've done is develop financial uh projections uh in order to review and fund future capital
improvement projects, evaluate uh cash reserve targets and financial performance requirements at existing rates to cover your costs. Um and then as I mentioned before, one of the other tasks we looked at that's specific to wastewater is designing a an alternative rate structure, which we'll
get into uh more about as we move through the slideshow. So, that's just an overview of our major tasks. In terms of uh major goals and and considerations, you know, what we're trying to do is um there there's a few main uh goals here. If if I were to think of it as three main items to
balance in a financial plan to your cash flows, you know, are they sufficient to cover your cost? Cash balances. Do you have an adequate amount in reserve to cover contingency events and and and other issues? And your coverage. coverage is a a financial metric um that's required by your loan
agreements. It it has to do with um a certain margin that you make over your debt payments to ensure overall financial health. So when it comes to to items that we're considering as a part of the rate studies, what we're looking as for your utility systems that it's also
um achieving and maintaining, you know, solid targeted reserve cash levels for for your various funds. Uh aiming in this case for 90 days of revenue for the reclaimed storm water and wastewater systems. And then also um maintaining compliance with your debt service agreements for for storm water and for
wastewater specifically. um because you have certain coverage requirements there that are required to be met based on your loans. And so we've accounted for for those things as we develop these plans. So moving in from the the general more into the specific we'll start with the
reclaimed water system here. Uh an overview on uh system customers uh growth and and rate revenues and other revenues. Uh currently uh the city uh rate system provides service to approximately 2900 accounts build on a
bimonthly basis. In terms of the forecast as we we look forward in time in terms of accounts per year so essentially flatline uh there stable uh account base uh in terms of system rate revenues at existing rates. So that's the rates you
have today. Those are projected to be approximately $1.1 million in 2026 and projected to be generally constant through uh the end of the forecast period 2030 2031. Um again this is the rate revenues assumed just based on the minimal growth
assumption and no increases in the rate. So that's revenues of the system. There's some minor items. There's a miscellaneous income that comes to about $16,000 annually that's comprised of some connection fee revenues, permitting revenues, uh disconnects, and other
miscellaneous type items. Uh, additionally, there's about 13 uh almost 14,000 per year in in estimated interest income uh on the the fund as well. Um so one thing to to mention here is that the the 2026 budget current
so as a essentially the uh the budgeted revenues for the reclaim system are not sufficient to cover the the operating cost or they're sufficient to cover the operating costs and the general fund loan payment in part but not enough to cover any sort of capital reinvestment in the system. And so that's important
to note because again like we mentioned earlier, we want to make sure that the the uh enterprise funds are self- sustaining. Uh switching from the uh revenue to um um here we're going to just a quick overview of operating expenses and and debt service for the reclaim fund. Um,
historically, uh, one thing to note is your operating expenses for this fund have grown on average, uh, roughly at about 16% per year since fiscal year 2021. So, so the bills have been going up. Um, and the operating expenses of are projected for 2026 to be about 1.1
million and to increase to about 1.3 million by about 4 and a.5% per year. The way we get that 4 and a.5% per year is as a part of the analysis, we look at your your detailed line item budget for the the fund. And then on a line item basis,
we escalate certain costs based on their nature or their character. In the case of labor related costs where those are escalated um at 4% per year, health insurance at about 10% per year. Other items that are more linked to inflation
in their nature about 2.2% 2% per year% per year and then the purchase reclaim water expected to increase about 5% per year. So all of those various line items of the reclaim systems budget escalated at those various rates comes to an overall composite of about 4 and a.5%
per year on average. Now with that um in addition to the the operating costs of the fund, the fund also has a loan um with with the the general fund and is currently repaying that with a payment of 61 repayment of that loan to the general
fund will be in about 2039. So those are the the main recurring type of um outflows for for the reclaim system. Then we we move to the the capital side because it's in addition to just operating the system, there's also the the capital improvement component and
the multi-year capital plan that's a part of the the forecast is a plan of about $4.5 million worth of projects. Um you see the the the graphic period of time. It comes to an average annual amount of about $676,000
worth of projects per year. And it's comprised of two main projects uh funded by rates. The two main projects are lateral service pipe replacements and and pigport installations. Those are the two main items driving that capital plan. So when we when we take then the the
operating costs that we talked about a moment ago that are increasing at about 4 and a.5% per year, well that's scheduled to go through 2039. And then we layer on top that those capital improvements that are planned in order to maintain your reclaim system and
service and everything. What what you'll see on this graphic here is the the sum total of those annual cash outflows are represented by the bars on the chart here. So the red component being your your operating costs, the orange being the the debt payments to the general fund, and the light blue being the
capital costs on an annual basis. And then the black dotted line represents your revenue at $1 million. So what you'll see in this graphic is that based on the projection of revenues and the projection of increasing operating expense and your capital needs, the
existing reclaim system water revenues are projected to be insufficient to cover the projected what we'll call revenue requirements um for the forecast period. in terms of if you were to try to think of it um what's the how's the pie broken out between all those costs on an annual
basis if we we sum total it all together revenue requirements is is operating expenses about 3% of the cost is the the debt payments of the general fund and roughly 35% uh is associated with capital projects those $4.5 million of annual projects
that I I had mentioned before um so what are some of the you know the main drivers in this situ situation. What's the story here? So, it's an environment where there's not a lot of material growth in customers. Uh you have inflationary increases on your operating
increases in your wholesale rates um to provide the service. You also have a need to um invest in and you know maintain your existing assets and and and take care of those to provide service as well. And then also a goal here like I mentioned before um ending
the the reliance on general fund transfers to fund utility system operations here. So those are the major drivers of what's affecting the the rates themselves. So with that rate adjustments that are identified in
the forecast would be then an increase in fiscal year 2027 of 50% in the rate followed by 8% per year for fiscal years 2028 through 2031. Uh that would be a total cumulative increase in the the the
bill of about 104% um over that multi-year period. So that would go from your your current base service fee of $25 would increase to 3750 so on up to to 5102 by 2031.
What this uh rate plan reflects is it's based on the projected revenues we talked about but making sure that all expenses all your debt payments and all the capital improvement plan as presented in the prior slides are fully funded. It also assumes no additional
transfers in from the general fund. So uh this is just a fact when we account for then the the uh revenues at the projected uh amounts or the proposed amounts. You'll see then that over the forecast period uh projected revenues are then sufficient
to cover your operating requirements as well as to help uh build some reserve in the fund as you'll see on the next slide here. This slide here just represents your estimated ending cash balances at the end of each fiscal year in the fund and
then what we're trying to in the fund and that's achieved by 2031 here. Um so that's again a good health metric to to maintaining the system so that there's adequate liquidity to handle you know any unforeseen contingencies or or other
sorts of unexpected operating events. If we look at a uh a bill comparison here, um this would be an average bill put on a monthly basis um for for reclaim compared to the average of some other communities we surveyed comes in just
above average. The average of the survey being about $2053. Um with the proposed increase for 2027, that would increase your position uh your bill to 37.50 on the higher end of the comparison here. Um, one thing I'll I'll mention when it comes to some of
these comparables, uh, I believe the the city of Treasure Island, um, gets its service from Penllis County and, uh, as the Penllis, which is, um, adjacent to you here. But what I wanted to mention is that since your bill is a fixed amount because you don't meter for for service
presently, that depending on the usage level will determine how you fit in the comparison. So if we were to look at a comparison of a higher irrigation amount, say 25,000 gallons, what you'll find is your your building the same whereas these other comparables start to
increase. So it it becomes a function then for comparability of what two trucks we wanted to show just two different usage levels to to give a sense of uh scale there. Uh moving to the stormwater uh utility
system analysis, it'll be a very similar setup in terms of the the slideshow and presentation method. Um you know, first uh system customers growth in revenues. Uh the storm water system uh bills about uh just under 7,700 parcels are build
via SE is roughly about 77 130 equivalent residential units which is the the units by which you build storm water. Again for storm water it's minimum growth assumed um in the forecast. So system revenues at existing rates for storm
water are about $1.4 million and are projected to be essentially constant through 2030. Again, that's at existing rates. There is some interest income assumed as well of about just under $28,000 per year on an annual basis. Stormwater fund is balanced through the
the use of um some existing reserves that it has. So on the the operating expense side, uh historically operating expenses have been increasing as well on this system too. uh roughly at a rate of about 7.7% per year on an average annual basis
since 2021. And looking forward um the operating expenses are projected currently for 2026 at about 1.3 million $6 million. That's an average annual rate of just under 4% per year. Again, same general theory like we talked about
on the reclaim side that it's a composite based on, you know, certain costs being escalated by a labor factor or health insurance factor or an inflationary factor and so on. Um so your your costs on the operating side are projected to continue to increase.
You have a capital improvement program. Uh the the capital improvement program in its totality is estimated about just under $141 million in in projects. However, what I would note is about 133
million just under 133 million and that is currently u budgeted as a as associated with the the resiliency fund. So 8.1 million is what's budgeted as currently from the slow motor fund and that's what our our rate plan right now
is designed on funding that 8.1 million 1.4 million per year in projects to be funded from utility rates and also it's assumed that the city would issue some some additional debt in order to cover certain projects. Uh roughly about 3.4 million from rates and about 4.8 million
in additional debt here. So with that, this particular utility system also has some existing debt service obligations. There's the storm water uh revenue note series 2015. That's an annual as represented by the blue bars that
you'll see on this chart. And that loan will be paid off or excuse me that note will be paid off in 2030. So you'll see the blue line disappear by 2031 as that pays off. Then, as I mentioned on the prior slide, there's a few million dollars in projects, about 4.8 million
in projects that are anticipated to be funded through the issuance of some additional debt uh through SRF. And those loan payments would then come on around the 2030 2030. currently anticipated it to come on at the same time and that would be an
annual payment of about $353,000 uh pleasing up to it um in the the tail end of the financial forecast period. So looking uh again at a you know familiar chart but this time for the storm water system um again you know
it's the same display operating expenses existing debt service in the orange yellow represents the new debt coming then 2030 there as it splits and then goes to solid yellow by 2031 and then the blue component being uh capital
funded from rates. And what you'll see here is again just like the the same story on the the reclaim side uh the your revenues are are not sufficient or projected to not be sufficient to cover your projected revenue requirements over the forecast period and just by the middle forecast they're not projected to
be enough to cover just your operating costs. So you definitely in terms of the the composition of the the cost overall it's about 63% um operating expenses about 8% existing debt about 4% proposed debt about 25%
capital funded from rates if you were to think of it as a breakdown from you know from a dollar standpoint. The again the major issues affecting this system are very similar to what's affecting the rate system. It's a low growth environment. It's operating cost. There's a
significant capital program in order to improve and maintain the system. And also as a part of maintaining that system and funding that capital plan, there's an increase in annual debt payments associated with the borrowing to to do those projects. So your operating costs are going up, the debt's
going up. we have a significant capital here. So in terms of the um the percentage rate adjustments identified and 15% per year for the first three years that would be fiscal years 27 28
29 followed by 6 12% in 2030 and 2031. It's a a total cumulative increase of just under 73%. in terms of uh what that represents for a single parcel with one ERU if we want to think of it that way. That would be a current bill of $183.75
for the year increasing to 21131 increasing to $31697. And uh one other thing to to note on that slide also again this is based on the full funding of all your operating costs, your existing debt payments, the proposed debt payments as well as the u the capital portion that's not
associated with the resiliency fund. So here's the um the projection at the proposed rates. You'll see that with time and with the system, we're able to phase them in a little more because you're you're this particular fund has some cash balances to it that allow for
some phasing of the increase as opposed to being more front end heavy like the the reclaim side. So you'll see that while we're still projecting some deficiencies in the early years by the the um you know 2029 roughly but really 2030 and 2031 the proposed revenues
aren't projected to be sufficient to cover your um your operating and capital requirement. Like I I mentioned the first two years there's a bit of a deficiency and that's represented you can see that in the ending cash positions here that in 2027 and 28 and 29 the cash position is
declining slightly but then by 2030 and 2031 it stabilizes and starts to increase by just a bit. Again the goal being you want to maintain about 90 days of great revenues in the operating fund here again for liquidity future capital unforeseen contingencies those sorts of
issues and It allowed for uh some phasing of those increases. Um again like I mentioned on some of the introductory slides, you know, we're trying to balance a few different things. The cash balances, your cash flows, but also this thing called coverage. And that's what what this
slide is about. Uh debt service coverage. It's a a financial metric that essentially is a measurement of your system net revenues to your debt payments. So how much of every dollar um of revenue after the other like like capital
uh in the case of the storm water system the 2015 note has some requirements to it that you have to meet um based per for a metric like this and the essentially the way the metric is calculated is it's your revenues of the system. So that $1.4 4 million roughly
in in year one minus your operating expenses gives you a net revenue number. And then that net revenue number is then compared to your debt payment number of you knowund in this case 115 uh% that has to be met in order to be in
compliance with your loan terms. So with this rate plan, what we're doing is we're making sure that as the rates uh phase up over time, um that you're in compliance with your required coverage and that's what you'll see here on the senior lean chart, the upper left
quadrant of the slide that for 2027 2829 you're in full compliance there. And the reason in 2015 um with the subordinate death uh debt that's the the SRF loans proposed to fund your capital a proportion of your capital plan those debt payments are
anticipated to come online right as the existing debt comes off. So that's why you see that the first four years are blank and then it it steps up in in 2030 and 2031 uh in all years here for for the projection period. um you would be in
compliance with with the proposed river. So then in terms of a bill comparison here, this would be an average residential storm water fee comparison for for uh one edu of um uh service. Uh the the survey utilities that that we
looked at averaged in at about $15848. Um your current fee is $18375 for one ERU. that would be increasing to 21132. So it' be an upward movement there. Slide that I still wanted to mention. I
believe Madira Beach fee is $120 per year. So they're a little below the average. And then Treasure Island, I believe, is about $311 per year. So they'd be on the upper end of the average year. Um, so with with this one,
one thing I'll mention is this isn't I I wouldn't consider this a report card on operations by any means because there's so many moving parts to this. What what the comparison can't show, for instance, is there any sort of level of subsidy that any of these other municipalities are providing to the
storm water fund and so it's not recovering the full costs in order to operate it whereas the rate plan that we're talking about is based on funding the full costs. So there's there's, you know, different moving parts. You know, when was the last time one of these other places had a study to look at this? Are they are they actually uh
including all the costs of providing service in the enterprise fund? There are some municipalities that'll put some of those order doesn't adequately show what it actually costs to provide the service. Um, in any of that, I'm just just trying to say there's a lot of variability uh
in these and also there's been a lot of interest as of late in uh communities updating their storm water fees and what we're finding is they're moving upwards and upwards as they try to make sure to cover their their full cost of operations. um some some other considerations and
and issues. Uh as I had mentioned more significant than than the $8.1 million that's built into this rate plan. As you may remember, there's about $133 million in capital projects that um are shown as being funded from the resiliency fund. So um what I want to
mention is um there there can be some uh issue as to how the projects are categorized. So, if the if those projects were considered to provide a a a citywide benefit to all properties in um that $133 million, then that would
increase the the rate plan up to 800%. Uh again, if you think about it, your your current rates are generating about $1.4 million and $133 million is a lot to fund. Even if you fund it through the use of debt, that's an annual debt
payment of like $7 8 million or or more. Um, so that would increase your your cost to operate significantly. However, there's some some caveats lines benefits to certain specific areas, then they may not be includable in the the base fee for service just
because of how assessment rules uh are in Florida. Um if if that is the the case for some of these projects, it could be a potential funding option um to use debt to fund some of those projects by zone and then potentially create a special
assessment by zone to link to that that would then be tied to those properties at that benefit. or that sort of method would require additional analysis to confirm projects and their nature, what they're benefiting, which properties they're associated with, and then linking all
those projects to zones and and financing. So, um, anyway, just wanted to to mention that, you know, that $133 million in projects would have could have to be dealt with in a in a different manner, and that's what this slide is intended for.
Uh, moving to uh uh wasteful Uh the wastewater system provides service to about 3,600 accounts build on a bimonthly basis. Again, minimal growth here as well. Existing rate revenues are projected uh for 2026 at about $8.1
million and essentially anticipated to be constant uh throughout the forecast. Again, that's at existing rates. Uh in terms of other revenues that there is no real significant other revenues projected aside from uh interest income of about just under 92,000 per
400 per year. Um when it comes to the budget for the wastewater fund, it's um in part balanced through um some general fund transfers into the fund as well as uh some grants as well. in terms of your your revenue requirements. Um uh historically the
operating costs for this particular fund have been growing between 2021 and 2024 at about just under 12% per year. Um the expenses then are projected from 7.3 million in 2026 to about 8.7 million or about just over 4 and a.5%
per year. Again, same idea. We're looking at your detailed line budgets and projecting them based on the the nature of that line item with the addition of the the purchased wastewater treatment from St. Petersburg. We're projecting the rate to increase there about 5% per year as well.
In terms of uh get service for the wastewater fun about $1.2 million. However, that's anticipated to decrease within this forecast period to just under a million dollars. Um, that's comprised of uh two existing SRF loans that you have. One of
them is anticipated to pay off uh 2026 and the other one is anticipated to be paid off in 2042. Uh you also have a wastewater system utility revenue note uh series 2020 that's also a part of that. So that all that's represented in the blue bars that you see on the chart.
It's kind of and then the red that you see coming online is associated with the funding of uh projects in your capital plan. Uh it's uh currently anticipated annual debt service payment of about two and a quarter uh almost uh million dollars per
year starting in 2029 and that's associated with about um just under $35 million worth of of debt funded projects which I'll talk about in in the next slide here. So in terms of it's a a large plan rather frontend
heavy of about 58.4 million of which that 34.7 number I was referencing on the prior slide is is anticipated in the plan to be funded from debt. That's about 60% of the plan. Um about 10.4 million in rates and about 13.3 million
in grants and other sources. Uh the two largest projects in this plan are the master force main one and pumps million and about $8 million respectively. And those are the big spending items in 26 27 and 28. And that
comprises the majority of your capital plan because that right there is about you know 43 44 million of projects up to 58 million. So in terms of adequacy of rates again uh the existing wastewater revenues at existing rates and based on current
growth are projected to be insufficient to cover not even sufficient to cover what's projected to be operating costs um as the the costs escalate over time. Uh in terms of the composition here
about 72% of costs are operating expense related about 10% are debt um existing debt about 6% are proposed debt about 12% of the costs are associated with capital being funded from rates
so um all three systems you know wastewater inclusive um again it's a low growth environment have inflationary increases on all your operating costs you have significant capital plan here in order to improve and maintain the system as well as expand capacity in this case uh
for your transmission system. Um there's the increase in in debt payments associated with the borrowings needed to fund those capital projects and also a need to improve the cash position of this particular fundament that we're we're identifying in the
forecast for wastewater would be uh 16% per year for 2027 2028 and 2029 and then a 5% in 2030. That's a cumulative increase of just under 64%. And you'll see the impacts to what would
be an average bill go from uh $95.34 by then to 15624. And again, this is based on all the projected expense fully funded in this plan and it ends uh any reliance on assistance from the general fund. Um now one thing I'll I'll
mention here is that like I mentioned at the beginning of the the presentation we have some redesign um that's associated with the wastewater system as well. So consider the the 16% per year increases and the 5% in the last year as how much
revenues rate revenues need to increase by in order to the the rate design in a moment but think of those as as your your revenue targets. Uh with um these revenue adjustments in mind, you'll see that wastewater
revenues are then projected to be sufficient to cover your operating costs, your debt, your capital needs to over the forecast period. Um that same rate plan is designed to get you to just about 90 days of of cash
uh in uh in your operating reserve. Important for liquidity, unforeseen contingencies, also creditworthiness. if you're going to borrow money, they want to make sure that you have um adequate margins on hand. Uh debt service coverage, again, you'll
see uh it's projected to be pretty solid uh throughout the the forecast window. Uh 27, 28, 29 are all very solid. Um the subordinate debt, it goes up and then goes down. That's because as your rate increases go up
29 2030 when those new debts come online it it pulls them down but still by the end is still a very solid level up predicted about 150% when the requirement is 115 for for that type of loan. If we were to take all your debts added
together and compare them on that margin that we're talking about it would still be very solid. Uh this is not a required minimum level. This is just an overall health metric target about 153% and might projected to be very strong on this margin.
Uh in terms of a residential uh bill comparison here, uh you'll see your your current bill reflected if we compare on a monthly basis to to your to some neighbors in other places. Uh the monthly bill would be shown at 44.65. That would be increasing to 5179. the
the average of the survey here is about $50.17. Um uh one thing the utility rates considering the the cost environment that we've been operating in especially the past 5 6 years and so a lot of communities are
doing studies in order to assess the the um the adequacy of their rates to cover their cost and so it's it's it's likely that as your position moves upward in this chart for any rate adjustments that are done so would a lot of these other places like uh city oft doing a study
right now you There's some others as well. Um, and so I believe uh, Madiraa Beach is provided by Penllis County which is represented here about the middle of the chart and uh, City of Treasure Island um, is provided service by city of St.
Petersburg. Um, so they're reflected in this by by where they their services provided from. Uh, one thing I I wanted to mention here on on these next few slides is just, you know, this is not an issue that's unique
to to St. Pete Beach, especially of capital and capital improvements are have increased in the past five, six years at a at an unprecedented level. Um, and to that end, many other utility systems across the state and everywhere are having to do more significant increases than maybe
they've had to do in the prior years. Um some examples are then notated here on this slide. Um for instance, you know, the the city of Winter Garden, for instance, for its wastewater fund, um they had a 17% increase in 2025 and then a 7% in the two years
thereafter. Um city of Palm Coast has 8enters. Uh city of Groveland just did a 40% increase followed by 10% per year thereafter. uh Wilton man 30% increase in in 2025 uh you know city of Bell had some very
significant increases on the wastewater side in recent years uh 80% 2025 50% 26 and projected for um 25% 27 you know 9% in Lake Wart 7% in uh Klay County Utility Authority 9% per year for
the city of Ovido uh Fort Lauderdale 7% 29% % and 5%. So again, I'm I'm being a bit dead horse at this point, but I just want to note this is something that a lot of communities are experiencing because capital needs are so um have increased so much and and the cost of
them have increased so much. You know, um construction costs are up, you know, 50% more or double depending on the nature of the project. We see this in in in all aspects of a municipal government as well. I uh just to use a an example
when we're looking I I do some work for for fire departments as well and you know a standard fire engine you know five six years ago might have been a a half million dollar $600,000 depending on how it's it's set up those same trucks over just six years are now
double you know pushing $900,000 to a million dollars. all sorts of municipal government um services have been increasing at a at an unprecedented rate and hopefully they're slowing down now but it was still a very big hit in the past few years that
utility systems are having to absorb. So with that um like I mentioned before there was some wastewater rig design that we also looked at for the system. So, not just what do the revenues need to increase by in order to cover your costs, but how could you structure a
waste other goals uh for the city? And so, what we looked at is your your current wastewater rate structure. And currently, all customers uh of all classes and meter sizes pay the same monthly base charge. And that base charge includes a minimum flow built in
of 6,000 gallons on on a bimonthly basis. uh your your multif family accounts are build per unit but otherwise everyone pays the same base charge regardless of the media. So that's 9534 and then for 6,000 gallons are included
at no extra charge and then above 6,000 gallons you pay a rate per thousand gallons of $15.73. So that's your your current structure. But what we noticed with that um when we looked at some of the the costs and this was brought to our attention by the city
manager um that we then looked into and did an analysis to see is what we found is that commercial customers are capacity cost or readiness to serve type cost. uh one thing that's very common in in in utilities is to have uh base
charges for service that if that increase in amount based on the increase in size of the meter associated with that account. So a larger meter account would have greater service potential, right? But more potential demand and to place larger demands on the system. And
so if the availability serve type charge is then priced according to to that larger base charge is a very common practice um in utilities. uh that can be based on the American Waterworks Association AWA uh published hydraulic
capacity factors are a very common method to use to scale the base charges upwards in order to try to recognize in that charge um the the uh relative increase in potential demand at each meter size in general. So this is a
common approach the the public service. So what we looked at was when we look at your your accounts um and we break them out by class residential, multif family and commercial and then just the overall average of the system. What we find is that if we were to take the total rate
related revenues um base charges and flow charges for the total system and then divided by the total wastewater flow that's that's built. gallons of float, right? So that average
cost per gallon for the system is about $33 per thousand gallons. So we did that same calculation or analysis but looking at it by class basis. So why do we do that? Because that sort of analysis can help uh bear out whether there are some
inequities in the system and maybe one class is subsidizing another and that there's some equity issues that you may want to address. So when we looked at that same calculation divide by the residential flows that got us a cost per gall cost per thousand
gallon of $3462. When we did the same analysis for your multif family accounts um we got a cost of $4542 for 1 per 10,000 g. And when we looked at commercial it was about $2542.
So what does that mean? means that in in comparison to what the average cost per thousand gallons is for on average about 105% of that your multif family customers are paying about 138% of that and your commercial
customers are only paying 77% of that. So what what this illustrates is that presently your your commercial accounts are getting quite a a benefit here that's born on on the customers of your residential and multif family classes particularly your multif family class
they're the ones picking up the brunt of it. So there's some some ne that's what we found when the city manager asked us to look into this because she had a hunch that there was something imbalanced with your system. And when we looked at the the numbers here, this is what we found. So this is
something that we want to address. We want to see if we can pull all of these percentages closer to 100. You'll never get it perfect just because there's so many moving parts and customer behavior and so on. But to the extent we can, we want to try to pull these in a little bit closer. And that's what the the
rate. So when the the proposed rate design is no structural changes to your residential class, so that rate structure is to remain the same. And the same holds true for multif family as well. But for your commercial customers, the base charges would scale by their meter size based on their hydraulic
factors or or you know capacity related factors. And then that commercial would pay for all of its build flows as opposed to just the flows over 6,000 gallons. Uh generally under, you know, to try to recognize the fact of the essential indoor usage, you
know, it's not discretionary, that sort of thing. Um so this this rate structure where the base charge is scale by meter size and all the flows are built. The idea is that the base charge would be phased up to a a full amount over a three-year period of time. That the
usage charges would be fully build starting in the first year. And then the the result of this is that this new rate structure would then of course generate and the reason is again we're trying to uh recognize that their capacity and and related readiness to serve costs need to
be captured in in their monthly bills or by monthly bills. But this would also generate additional revenues from that class because we're going to be charging them more now to to to address those issues. As a consequence of that, uh because the additional commercial related revenues are are being brought
in, that can help uh lower some of the uh rate increases on the residential and multif family class uh between uh 12 to 26% over the forecast period. So essentially by trying to address this inequity, this this subsidy that um that commercial
class uh customers have been getting, you're addressing that issue and trying to treat your customers a little more fairly on a on an average cost basis. And it allows for a reduced impact on your residential and multif family uh accounts. What that structure would look like for
commercial is what what this slide represents here. You'll see your exist again your base charge is the same regardless of the meter size. So whether you're a 3/4 in account or you're an 8 in account you would pay $95 a month under the present method and you would get your first 6,000 gallons uh at no
charge because it's built into the base charge and then you would pay $15.73 uh for thousand gallons thereafter. What we're proposing is that between fiscal years 2027 and 2029 that those charges start to phase upward
as again their their potential capacity demands and and readiness to serve component. So using I'll use the the largest on the board here an 8 in account and presently you don't have any 8 in accounts but just using this for illustrative purposes that charge would
go from $95 and um excuse me $95.34 uh for a bon bill that would increase to five uh just about 5 uh 9800 and change and then to about
17,000 over the phase up period for more your more common smaller meters like 1 in 1 and 1/2 in. Uh that's where the bulk of your commercial class is is 3/4 one and one and a half. Um looking at the 1 in for instance $95.34 the first incremental increase to phase
up those base charges would be uh to go to $19242. Then that would increase in the next year to 25656. uh 2030 is just the 5% adjustment uh in the last year. So the again the intent here is to try to phase this in over a
three-year period of time. Uh the reason we picked 3 years is it it allows for enough time for for adjustment and implementation and not so much time. If you try to spread this over five, six or or more years, what can happen is partway through the phasing plan
uh there may be a you know a change in in direction. Um with a longer type of uh rate structure change program is that um it gets lost in the weeds over time and you may not fully implement the plan in which case the design then doesn't uh
achieve what it was originally intended to because it was never fully implemented. So, we feel that a three-year implementation is enough to phase it up over time, but also still be manageable to to implement and and make sure it's done uh successfully. Um, so you'll see that's
over time and then all flip flows being built starting in 2027 for your commercial class. So, what would a an average bill of your your most common meter sizes look like then? Um the most common meter sizes you
have for the commercial class are 3/4 in, 1 in, and 1 and 1/2 in. So even though we've designed rates for anything potentially larger than that, uh the bulk of your commercial customers resided in these brackets counts for uh for 3/4 in commercials about 8,900 gallons. For 1 in, it's
about 18,700 gallons roughly. And for one and 1/2 in, it's about 35,000 gallons. So, what do those bills look like under your present rate structure? Again, um because there's more usage tied to these bills, um your existing bill be $141
for a 1 in be 294. Change for a 1/2 in should be 560. One for 3/4 in account would increase to uh 385. the 1 in you'll see a more pronounced increase because the there's a larger base charge scaling to account for. So
it goes from about 295 to872 and for one and a half inch it goes from about 560 overtime to just under uh $1,700 for the bon bill. So that's kind of your your average account uh of
the class. This schedule here is quite a lot busier. Uh essentially it's it's more drilling down on the 1 in account year 1, year 2, and year three. and what uh at various usage levels, you know, 3,000 gallons going to 24,000 gallons is the
first column of each uh chart here. What your existing bill looks like in your proposed bill and the change in the bill. And so what you'll find started a 16% increase in overall system revenues for your wastewater system because we're redesigning the uh the
Rick structure for commercial in order to address those inequity issues. um that to try to address the the subsidy that residential multif family is providing this class the increases that this class is then going to feel as a consequence of the rate design is then more pronounced. So what you'll see
depending on on the usage level you'll see increases uh in the um depending on the usage level for 1 in could be between 160 uh% down to uh 66% but then the higher the usage gets the more that's diluted. So you'll see that
decline over time or overuse in driving you know uh between uh about 30% 20% for for year two for 1 in about 40% 25% by year three. Similarly for the the one and a half inch customers
uh you know significant increase is a bit less from uh what could be the highest of 200 plus% uh to 58% or 51% to 27% in year 2 53% to 29% in year three again depending on the flow associated
with that account. This was just meant to be a a bill comparison that again illustrates um the impacts by more ranges than just your average over the class like the the first slide was. So, so with that the uh proposed rate
design again it um there's additional revenues that are generated by this structure change and it would allow for reductions in the overall uh revenue adjustment needs from your residential and your multif family classes. So whereas again like I said we were targeting 16% per year for the first
three years because of this structure phase in for commercial it would allow for the residential class to only go up by 13% per year for the first three years instead of the 16. Um so whereas before if we were to treat
everyone uniformly it was going to be about a 64% increase in this case residential would only get about a 52%. And multif family would get about a 38% increase uh cumulative. So when we when we look at this um this
structure and we talked about that inequity issue we we were looking at uh on the kind of one of the introductory slides of of about 105% of average cost. Multif family was paying about 138% of average cost and commercial was paying 77% of
average cost. Under this design you get um residential to about 99% and change of system average cost. So you tighten that one up closer to 100. For multif family, it brings it from 138% down to 119% of average cost. Um so about an 18%
pull in closer to 100, 77% to about 92%. Uh an increase of about 15% on a per um dollar per thousand gallon type basis. So essentially what we've done is we've we've tightened the each class closer
around the average such that we're we're trying to treat them all a little more fairly on a cost per gallon basis so that it it mitigates some of the subsidy. Can can this be you know made perfectly 100 100 across the board? Um because you're always going to have
moving parts and you know customer behavior is a part of this usage characteristics and so on. But this is a essentially a a you could think of a a first major step in trying to address some of these inequity issues between your classes. And this could always then be addressed in some future study where
you look to try to if if it can be tightened up further, you could always look at it again. But at least for this first pass, that first major threeear phasing, this would address to at least a large degree that subsidy that your commercial classes uh
currently receive. So again, major observations on the rate design. Again, we're attempting to rebalance the average cost per thousand gallon by class so that they're closer to the average with the goal of trying to treat customers more fairly and equitably across classes and trying to
mitigate crossass subsidization to the extent we can. Uh this will address some equity issues and multif family customers. Um, and it also as a consequence of this, it also creates a reduced base charge for your
multif family customers that comes in at about 91% of the current residential rate, which is also a very common design uh in uh utility uh rates. Uh oftent times multif family based charges will be reduced compared to single family to recognize that on an average basis a
multif family account uses less than a single family account. So all these different kind of of this uh rate structure here. So with that I've done uh 62 slides worth of talking here. Um if there there are any questions on on the revenue
sufficiency side of of the slideshow or the redesign portion of the slideshow, I'd be happy to to field them. Uh thank you first uh Mrs. Casio for your presentation. Um we appreciate it. Um I suspect you should keep yourself at the ready because I think there might be
a number of questions coming your way. Um I'll look over at my commissioners to start with. Um but again, thank you so much and I will hand it over to uh Commissioner Maldonado, please. >> Sean, again, thank you uh for a uh lengthy and detailed
briefing. Can I get you go back to slide 27 with the uh storm water slide rates please? And while you're doing that, uh when is the last significant rate increase we've had in the storm water? Can you tell us?
Uh the the last major increase in storm water um I may have to defer to staff here, but I want to say it's beyond um what 10 years plus. I know on the wastewater side it's been at least uh 10 plus or more years um since that was looked at.
>> Okay. And same question for reclaimed >> been looked at uh in quite some time from from my discussions with utility staff. >> Thank you. Thank you. I'm sorry. >> Commissioner Cy Sean, thanks again. I
think this logical approach is exactly what we needed and it seems like a great uh study you've done here for us. Um it seems uh you talk about the unprecedented cost that we've seen over
the last four or five years and it seemed like the increase that we saw in our opex was about 16% per year from in most of the funds. I know in u in
reclaimed water 16% per year since 2021. Uh storm water opex was 8%. And then in wastewater 12% per year. So I guess what one thing I wanted to understand more
clearly is uh we are predicting uh or or we're planning to for uh looks like 8% on page 14 or our next five years. So, and then on
storm water, I see we're planning for 6.5% steady state in the last years after we make up I think for the uh lawn and then uh in wastewater it looked like
a going down towards 5%. So, uh, based on the 16% increase that we'd seen over the last four or five years, I don't understand why we wouldn't be planning for more. Could you address that? Like I
>> Why did we have a 16% increase over the each year for the last five years? So the um the the average increases in operating costs that I addressed on the the front of each particular um enterprise fund slideshow um that's the
the average across the past few years but in some instances it was um it it wasn't necessarily un may have been let's say 16% per year on average. Some years were higher and some years were lower. And based on what we were seeing in the more uh the more
recent few couple of years um as it then relates to what your projection of operating costs were and and what um city staff feels is is appropriate for for labor costs and other types of items and the capital plan. Um that's where those numbers bore out. Um,
so while the plan that's been um developed uh is based on the premise of what your current 2026 budget is and then escalating from there and um you know to to some degree some of those inflation type items have been starting to
stabilize. Um so it's it's essentially linked to to that premise that um the past you know since 2019 to you know 2024 was a very very expensive in the past couple years that's started
to to stabilize a bit and so that's why the the forward looking on and projections are are at a a lower rate of climb but one thing I would note is um that's those rates of change are just on the operating cost side, they're not uh reflective of your capital costs over
that window of time or your your debt payments. So, in in some of these forecasts that we were looking at just a moment ago, you know, we might be projecting, let's say, cost, but that's not accounting also for the increase associated with your your your new debt payments coming online.
So, I was speaking more just to the the operating cost on on those percentages historically. Okay, I'll stop for there. I may have another question or two in a minute. Commissioner Robinson. >> Hi Sean. Thank you so much. That was
very informative and unfortunately not a surprise. Um what I did find was surprising and informative is on the wastewater side with the commercial aspect. Um and I thank you for um enlightening all of us to that. Um, I
have a question. Actually, I have two, but I don't know if they're actually to you. They could be to staff instead, but um, do we know when the last time we did not have to use general funds to supplement any of these?
>> One moment, Miss Aassio. We've got a staff member coming up. >> Okay. >> Hi, good afternoon. Devin Schmidt, finance director for the record. Um the last time I would have to confirm um but
I would say it was around 2022 or 2021. I'd have to confirm that. Um but I could certainly do a followup for the commission. >> Yeah. >> Thereabouts. Okay. And then um the two special assessments we have writing on our tax bills right now,
>> I believe both of them say uh storm water, but I don't believe are they both truly storm water? >> They are. And that's the debt service that we're looking at. >> Yes. >> And then we're looking at going in again for more debt service. >> Okay. Just just wanted to clarify that.
Um since those are on there. Thank you. That's all the questions I have. >> Commissioner Marriott. >> Thank you. Um and thanks for everyone else's good questions. That's uh that got that got some of mine, but I I still
have a whole bunch. So, um, my first question on reclaimed water, and this might be a question for staff, um, is do we know if that 2900 accounts for reclaimed water, has that been steady over the last 10 years? Is that a
posttorm number? Is that significantly fewer accounts than we used to have? Have we taken Have we worked into the equation if we raise the rates that some percentage of people might cancel their service? is is has any of that been
worked into the math or the projections? >> Um, this is Sean here. Uh, as far as uh growth in accounts and change in accounts over the past 10 years, I can't speak to that. I'd have to to defer to utility staff there uh on that one.
>> We'll have to follow up. I'm seeing that we don't have that information. >> Okay. Yeah. Yeah. I would be I would just be curious as to see if you know since the hurricane we have a third fewer accounts because of all the houses that got torn down and we anticipate that those people will rebuild and
reconnect or if that's not at all the you know I mean that 20 I feel like that 2900 accounts could easily turn into 1,800 and it could probably just as easily turn into 3,800 and and I'm not sure we know that know that number taking into consideration the the situation that we're go that we have
right now. Um, also on the reclaimed water for the capital improvements um of about $675,000 a year over the next, you know, through 2031, do we anticipate that those um
that that will be kind of an an ongoing amount for capital improvements that will continue to be required or do we feel like once we've replaced all the laterals and done that other work that we might have a period of time where we don't have those capital costs in the
reclaimed water system. You can ask the public services director to answer that for you. >> Good afternoon. For the record, uh Camden Mills, public services director. Um for the the reclaim water, um the big
bulk of the capital need is is replacing the laterals. Um I don't have an exact idea on like the number that has been replaced historically. That's staff is is we received that recommendation from the finance committee at the last meeting. So we're trying to gather that data. What we do know is it's going to be more than five years. So what we're
looking at in in this study is is you know that's not going to change. The question is you know is it going to be 10 years? Is it going to be 15 years? >> Okay. So five five years isn't going to get it done. We're it's just the number for the next five years. >> Correct. >> Okay. Perfect. No, that that makes that makes all the sense in the world. Um and while you're here, um this might also be
a question for you. Um when we talk about the reclaimed water h and I know at the finance um committee meeting there was some talk about um you you know having the system metered or charging different rates for different kinds of customers and do we
have any um thoughts or ideas about how we could start to transition to a bit of a metered system? you know, it's it's um it seems to me that like long-term it it's crazy to be providing water that's not metered. Um and so I don't
know if if we have and and I understand there was some discussion about the cost of transitioning to a metered system would potentially cost more than you would ever recoup. But is there any way to like over time transition into a metered system or or start to transition to a metered system?
>> Potentially. Um I think you know my recommendation with there would maybe target the larger customer or like the larger commercial customers and and start there. Um I think that was an idea that was floated around in the past was looking at like some of the resort hotel district areas and start >> and there's no there's nothing that prohibits us from doing that. There's no
state regulations that say you can't you can't meter some people and not some other people or anything like that. We can probably do it however we want. >> I would think so. I would think we just have to update our code. >> Okay, perfect. Yeah, thank you very much. Um
the other question I have is regarding wastewater and um do we know when we were talking about the the rates for commercial customers. Do we have any idea um I mean I think we
must to have done the study um how how many of the different meter sizes we have in St. Pete Beach or how many I mean I'm assuming we probably don't have any 8 inch meters that would be >> I don't think we have any 8 in um but we
we do have that data available. >> Okay. >> So we could we could share that. >> Okay. Um and then >> Yep. Go ahead. >> This is Sean here. Um to to that question you were just asking a moment ago about number of customers.
Um you have a handful of 4 in the bulk of it is um 3/4 in 1 in and 1 and 1/2 in. That's probably uh more than 2/3 of your of your customer base that right there on the commercial side.
>> I'm sorry. What were those uh what was the the max on that one? You said >> 3/4 one and one and a half. >> 3/4 one and one half. Okay. >> Yeah. Thank you. Um, and then again on the on the wastewater side of things, just like on the reclaimed water side of things, have we
factored anything into the equation of projected revenue of of of if the rates go up, people may conserve and use less? Um, was was that factored into the projections anywhere? >> I don't believe so.
>> So, in in terms of >> Oh, sorry. Sorry. in in terms of uh uh what you're what you're speaking to is price elasticity here. Um your your average usage on on the bulk of your your minimum threshold of flow anyway.
So there's not really a projected material impact to any increases associated with multif family or single family. Um could there be some behavioral change in commercial? Maybe. Um, you know, again, on the wastewater side though, it's, you know, we like to
think, you know, when it comes to a commercial enterprise is that they already have a built-in incentive to try to be as efficient as they can with their usage because they have the profit motive. Potential for change in behavior, of course. Um, in this particular analysis,
we're we're not looking at too much of a difference in the usage side because the bulk of the increase that's being experienced is on the base chart side. >> Okay. Thank you. Um, and then I guess my last question would
be for Devon. Um and that is that as we've as we've gone through those slides on the reclaimed system and the storm water system and the wastewater system and there was talk of you know potential additional debt coming online further down the road and the debt servicing
requirements um and and I'm assuming I know the answer to this question but I just want to make sure are we confident that that those debt servicing amounts all added together are still a manageable number for a city this size even if we have a potential future
economic downturn or something like that or are we have we not have we not looked at itite quite that holistically yet as far as you know can can we take on all this debt in all these different places is is that the smart thing to do
>> so um part of what Sean shared in the presentation and what he discussed um was that we do have debt coverage ratios so when we're looking at any one of our different funds we're looking at that different um coverage ratio
per fund. Um the areas where um I think I believe it was slide two or three that he pointed to when we're looking at the governmental accounting standards board. Um and the reason why you don't want to continue to supplement um those funds with your general fund is because it can
um down the road impact your bond ratings. Um because what you're essentially doing is you're showing that you don't have sufficient rates to have to meet that debt coverage ratio. Um, and so when we're thinking about some of that bonding, that's certainly a component of it. And then, um, I would
just say if Sean, if you want to add anything to what I've shared, um, please feel free to do so. >> Um, sure. So, no, you're you're right about that. Um the the other thing is it uh it can be very appropriate to to use debt as a part of a financing plan for
for utility enterprise funds because you know a lot of the projects that you're doing have very long useful lives. Um so it makes sense to to match the the utilization of of the asset that's being constructed let's say um across its useful life. If if you were to try to
fund all of your product over time, what would end up happening is, you know, you're making your current customers pay for something upfront and not stretching it across all the units of growth that that you may have over time. Also, you're you're paying for the whole thing at once. It it's no
different than like um you like like when we try financing uh cars or or homes and so on. we're you know to to a large degree matching the the utilization of the asset um over time and its cost through the financing. So it can make a lot of sense
obviously you know you don't want to use too much because then you can run the risk of overleveraging yourself. But in the case of the the borrowings that we're anticipating here as a part of the the storm water analysis and the wastewater analysis, we've tried to be mindful of um you know your your financial metrics as a part of that um
just to make sure they're they're in compliance with with requirements as well as city financial targets and and so on. >> Thank you very much. I appreciate that. Um and then my final comment is just on the the commercial rate uh the proposed commercial rate change. Um, and I'm uh
I'm first I want to say that I think that's I think that's wise to do. I think it's crazy that we've been charging the same rate for every meter size and and so I think we definitely need to address that. Um, I would be a little bit cautious on the the smallest
end of commercial business with the the smallest meter size and the lowest use that um with the proposed changes, we're potentially looking at, you know, for the smallest of small businesses, we're looking at increasing their um their
wastewater portion of their water bill, you know, we're looking at at like tripling that. Um, and so for a really small business on 8th Avenue or a small business on Corey or our small restaurants, um, you know, a a an extra
four $6,000 a year can be, you know, very important to them. And, and I think something that we've heard from the community repeatedly is that, you know, one of the things that people appreciate about St. Pete Beach is that we have small businesses and we have local independent businesses. we we're not all
Starbucks and McDonald's and big chains and uh um and so I think those are the people that I think we need to try to protect when we when we're orchestrating something like this um so that we encourage more businesses like that to come into St. Pete Beach. So, you know,
I I my my my initial feeling on that would be that, you know, maybe on the 3/4 in size of meter or the 3/4 in and 1 in size meter, we reduce the base rate maybe just a touch or we we make the first 3,000 gallons included in the base rate just just to really take care of
those people that are really on the lowest use small business side of things. >> Thank you. Uh, Commissioner Cy again, please. Uh Sean, I've got a question about erus relative to storm water. Um I
guess that's the way we figured out how to aortion storm water since you don't have a meter for that. Um I've noticed you came up with 7656 parcels, 7,656
parcels and 7,38 erus. So I'm wondering if you could walk us through the formula of how we figure out erus. >> Uh sure. So uh an eru is uh it links
back to a imperous area associated with um a to look up real quick what your imperous area is per per unit. But but essentially the difference is um you can have a a parcel and then depending on
the the amount of u you know the footprint of any structure on that parcel, you know that that that's the portion of of the the the area that's impervious. The water runs off of it and goes um off into the ground to to your storm water system. And um
the uh sorry I have another screen open on my side. I'm trying to find your definition of of eru to know the square footage right off the bat here. >> So is this something you had found for us or you calculated this yourself? And you are cutting out quite a bit. So when
you're trying to explain a detailed um formula we're missing some of it. Oh, okay. I apologize. Um, so essentially the way a number like that is derived generally is there's a a
sampling done of all your your residential properties or some significant percentage of your residential properties to come up with what's a an average amount of impervious area associated with those residential properties. And that's done because the
way you build is then in terms of an equivalent residential unit. So for example, if let's say one equivalent residential unit, which I'll call the let's say that's 2,000 square ft of imperous area. I'm going to use that number to keep the math easy on me. um
when you then are pricing uh let's say commercial or or other land uses um and let's say uh an easy example a big store of some kind supermarket or something let's say that's you know I don't know 50,000 square ft of of imperous area
then the way you would build it is you'd go okay well it's 50,000 ft of impervious area ft so that particular structure is worth 25 PRUs So whatever the rate per eru is, you would take that rate times 25 and
that would be the the charge for um for a property like that and and it scales accordingly. So you know if it's a larger property they'll pay more fees um again because it's it's trying to um it's trying to put everything in equivalent units so that then you can uh
aortion the cost uniform. >> So let me let me interrupt you for a second then because um I We have a difference in um between parcels and erus of less than
80. So I'm a little concerned that how we're figuring that out. I mean we have some very large properties here with a lot of impervious and it seems like 80 would be far too small of a difference between parcels and erus.
you you have a a a fixed parcel rate um and then you have the tier 2 which is the portion of the bill that's um eru based. So when when we're talking the increases that we're we're looking at um it was based on the premise of just talking from the the standard one parcel
one u to um to to keep it simple. Um but yeah to to the extent you have accounts that have more erus to them that tier 2 portion of the rate would be the one that scales. >> Yeah. I don't understand why in um in your presentation though we're using
7738 erus and there's 7656 parcels. So I still don't understand that >> cuz cuz you can have some parcels that have more than one ER worth of imperous area on them. >> Oh, okay. >> Because that's a function of the size of
the structure. >> Okay, I understand now. >> And um while I'm on it, there's another question I have. So if we were to take wastewater for example, the comparison slide that you have for
us with other cities, um is that I don't think I put that page down there. It's probably about page 50 if anyone wants to see that. Um so for for us, for example, we were thinking $51
versus for St. Petersburg they're at 60 and Penllis Park or yeah Penllis Park there they're there compare at $75 and uh you have other islands listed there on that slide that showed about $75.
Uh considering how much damage we got out of the hurricanes it seems like we would need to have a lot of work done around here and I know we have force main one which reached the end of its service life. So this is a giant project
that we're looking at. So I I don't understand why we wouldn't be thinking about having equivalent rates at least with other cities. And this actually applies to the storm water uh comparison as well because you've got us at 183
whereas Dun Eden also located on the water uh is currently at 240 and St. Petersburg right next to us is at 275. So just on the face of it, and this is rates per eru, so it really should be
roughly apples to apples. It seems like we're still underfunding ourselves. Well, one thing I would would mention here is each one of the the respective rates that's shown for let's say any of those storm water um comparables that were on the survey, you know, um for
one, what we don't know in that comparison is what level of costs those particular time they looked at their their rates for service. So, we don't know um are you know are they charging a fully burdened service rate? um we don't know
who isn't who isn't, what level of grant funding or subsidy or other or other sorts of items they're getting. So to to fully um there's no way to fully know what's in there to to compare it in that sense. So what what ends up happening is
for um for let's say for for storm water here the uh design with staff is based on the full funding of your projected operating cost, your projected capital needs and and your projected debt service payments fully specific to to your uh community.
And um you know that's based on how your system is is configured and set up and its um um required capital needs as determined by city staff. Any of those other comparables in there, we don't know if they're fully funding their program in similar fashion.
You guys are underfunding by comparison to some of the ones on the higher end. There's there's so much variability in the structure of the costs of each one of these places. It's it's hard to make that kind of um determination. Yeah. And if we were to think about the storm water, for example, where we're at 183
in St. Petersburg, right next door is at 275. And we know we haveund 100 million in uh capital projects that need to be done, but we're not even addressing those here in the 183. So,
just wanted to highlight that. Uh I feel like we might be underfunding ourselves here. Commissioner Maldonado. >> Yeah, I know too. Uh, Commissioner Kazies and Sean, you can probably comment on this as well. Is that we just we need to remind ourselves though that
certain projects are going to benefit certain specific areas and those should not be included in the basic service fee. So, there's going to be a requirement to look at this um holistically without including certain things. So, I think that if I understood
your question, you're trying to capture everything in one lump sum, but at the same time, we have restrictions that prohibit us from doing that with the basic service fees. >> Well, I think that's a good point and maybe Sean could address this because I
I did have a question about that. So I'm confused as to why say wastewater when we do uh lift replace a lift station for example in a specific neighborhood that is funded across the board whereas storm
water seems to get segregated into zones for some reason and really it would also apply to uh repairs in our uh reclaimed water and other utilities for that matter. Sean, let me take the first stab at this. So, I I because this is a really
complex technical question. And so, um, and I'd like the city attorney to weigh in as well, but before we would spend money on major capital improvements for storm water, we would be having bond counsel as well as our
city attorney weighing in, specifically on uh prior city documents. We have evidence to show that we have treated the storm water system as one unit or one basin that's a better term over the past uh several decades for this city.
So those are evaluation techniques we need to look at. Um I would agree that we have not done that assessment yet. So you don't have a rate study that has taken into account the tens of millions of dollars of projected either new
infrastructure. The one you have today is looking at current infrastructure and what would it take to maintain just the current storm water basin as it sits today. Um part of uh the approach that was taken was because we are
recommending major policy shifts right now for you to consider which is a lot. So sometimes you got to take you know small bites out of I don't like to use an elephant sorry take small bites out of the big hamburger that you can't eat all at once. And so that's one of the
strategies was we have a lot to do. So let's take this first sort of rip the band-aid off and then there's going to be a second piece with multiple studies going on citywide right now on storm water that we can certainly um address
in a future consideration. Now if you have a different approach you'd like us to take we can consider that and bring it back. You just saw though, we did ask Sean to say, "What would it cost to fund all of this?" And it's an 800% increase
on top of what we're proposing and we didn't think that would be um very palatable. So, >> it's not a tasty burger. >> No, that's why we didn't come in with a fully loaded study on that piece yet.
>> Um Okay. Thank you. I I don't see another lights on. So, I'm going to I I do have a series of questions and I apologize. Uh I know we've been at these questions for a while. So, Mr. Aassio, if you'll just uh give me a little bit more time, please. And this may involve some of our city staff or or folks as
well. So, um I'll run you back if you don't mind. I might I might point you to slides, although I think our slides are going to get out of out of whack pretty quickly. But early on, I think we maybe slide four you talk about, uh GSB and how enterprise funds should be used to account operations, right? and and you go through all of this and I just want
to ask the question very overtly. Um GAB is intended generally to include capital spending in the future. Is that correct? We should be we should be thinking about our capital spending as we do this accounting for enterprise funds. I just want to make sure that I'm correct in that assumption. Uh yes the I would say the best type of
planning to for enterprise fun >> understood but also capital >> I went down a series of other questions I'll make sure I understood that we we should have been thinking about capital improvement always for gb just just to be clear um and then
I'll jump you quickly uh I think this is uh it's my slide 11 but I'm not sure you know, maybe we're close. I know at some point our slide numbers started getting out because you mentioned you made some updates. So, jump me to slide 11. I'm looking at the adequacy of existing rates, please. Um, and I believe this is
on uh reclaimed water. Thank you so much. Okay. Um, so this might be a a question to city staff as well as uh as well as yourself, Sean. So, um, if we should have been accounting for capital
improvement projects and, uh, I'm looking at the just the 2026 rates that are sitting here in front of me. And so, I'll ask that that blue, uh, capital improvement piece that's sticking across the top. How long have we known about these these capital improvement projects that are that are due? I assume we
didn't learn about them this year. I assume they've been known for a number of years. Is that maybe maybe Yes, sir. I see you standing up. If you'll come up and answer for me. I'm sorry. I'm I'm gonna ask a series of what I hope are quick questions and then I'm trying to lead somewhere.
Um thank you. Camden's coming up. You might stay close cam too after this. >> Um yes sir. Yeah you are correct. That would be capital improvements that we would you know have known um before due to the condition of those reclaimed laterals and the amount of maintenance that we put into that on an annual basis.
>> Okay. So they were known before the 2026 budget was put in there. Right. And so I think I heard earlier in this conversation that 2021 is the last time that we've not borrowed from our general fund. And so, you know, I'm I'm I'm I'm asking maybe rhetorically asking the
question that we've got a history of underfunding our uh our city's um operating and capital costs. uh to the point that as I look at this chart and it and it and this is just an indicative chart across the entire set of enterprise funds, they all show this, we
fund barely at operating and uh and maybe a little bit of of existing debt, but we've never funded for capital improvement projects. I mean, not never, sorry, in the last I'm imagining five years, uh we've not funded for capital improvement projects, at least by the the conversation that we're borrowing
from general funds for the last five years. And I just, you know, I I I am perplexed. It's probably a nicer word. Um as to why we've been funding our city at a rate that didn't allow us to invest
in our capital infrastructure for at least 5 years now. And uh and now we this commission get to be the ones to try and put things right uh and and actually do what I would call fiscally responsible
um right sizing of our cost rates. And I'm and I'm uh I'm frustrated by that to be frank with you because I you know I I've got four or five months into this and and I'm walking in and saying hey let's raise the rates across the board on every one of our enterprise pieces
and I and I am am uh again frustrated because this could have been done. These capital improvement projects were known these could have been done over preceding budget cycles and they weren't. And u you know I think I think that's unfortunate for us sitting right
here to have to go and uh and resolve that. Um I'm going to keep moving though. And um I think we've already talked about this piece. Give me just one moment. I'm just scrolling through my comments that I'd
already created. Um I think we're you're recommending in certain scenarios that we are that we take on additional this might be for you Sean please. Um that we take on additional proposed future debt. And my question is, you know, rather than
taking on additional debt, why don't we rightsize our our uh our systems now um with the right cost structure that means that we don't have to keep doing this borrowing from either general fund or borrowing from some third party bond
fund to try and get ourselves in a situation that again I'll call fiscally responsible where our fees and our and our uh our revenue incoming equals enough to run our city plus invest in our long-term future. And so I would generally be of the mindset that
I don't want to see any future loans coming through here unless they are absolutely necessary. And yet I know that they're kind of baked into at least a few of these enterprise funds uh from your from your at least um analysis. And so I would ask maybe Mr. Aassio um
um what is your rationale for baking in proposed loans already into this system? Uh I get I get the one on frankly I'll be I'll be upfront. I get the one on on the resiliency $130 million. I I get why you would say that is not there. But let's talk about the other ones where
we're proposing loans to be dropped in just to kind of keep us moving and and being able to to uh invest in our capital. Why wouldn't we raise our rates and and bite the bullet now and be done with it? >> Um well, you know, that that certainly is an option, but what we're trying to balance is, you know, the the immediate
funding under these capital items. Uh to the extent that these are are long live, so finance them over time. Um that way you're not creating an undue burden on the customers in the near term uh in order to fund a project that's going to last the next you know 30 40 years pay
it over the next five years um and and hit your existing customers for that additional. So it it can be prudent to to finance certain longive capital type projects over time. Um but again you don't want to over rely on that because that can be something that can also have a detrimental effect to to the utility
system. >> Yes. to be had there. Uh when it came to, for instance, the storm water fund, you may recall that the debt roughly speaking was about a clean swap of from your existing debt to the proposed debt. So it's it's it's not necessarily a full
addition on top of because some of your debts paying off there. Um so the idea was that as the some of this debt comes off, you have some flexibility in the rates to handle borrowing for these projects because the rates already would be set to that level to fund it. If you were to
period, you'd have higher rate increases. And also, like you said, you would be biting the bullet. I guess the question is um you know, what caliber do you want to absorb? >> Yeah, that's an interesting phrase for the question. I I appreciate that. >> Um all right. Um I'm going to jump to
what I think is page 36. And this might be Cam, then a question for you. So just just be prepared. Um I'm not sure what your slide number is, but I call it 36. And then it's about your revenue requirements, capital improvement, and it notes a $58.4 million capital improvements. Uh, you know, as the very
first thing. So, if somebody could please jump me to again, it's my slide 36. It's probably not in that deck. >> Yeah, I'm showing slide 35 on that. >> Yep. I think we got it in front of us. Well, at least I see it on the screen here. >> Okay. >> Okay. Um, this is probably a question
for staff. Um, I know about a month ago we got um kind of a a spreadsheet and I I'll acknowledge it's a it's a working spreadsheet. I'll acknowledge that. Um, but it listed uh among other things in that spreadsheet. You know, it listed among
other things um the cost for 2027 and then a 7-year projected cost for all of our various capital improvement projects. And that total seven-year cost as I saw it around uh I think this is I think we're looking at wastewater here but I'm not sure. Um
but it was significantly less than 58 million. It was like 43 million as I added the numbers up. And so that's that's a huge jump because I think that that spreadsheet last I got it was about a month old. And so now it's about a $15 million jump in a month. And um maybe
this question is for you Camden. I mean, what did we learn that jumped that capital budget from 43 something up to 58 million and and and what is new and what is driving that number? Please, >> the um the the 58 number would have um
preceded that that previous spreadsheet. So, this would have been based off of, you know, data we provided to Raph Telus at the very beginning of this study. Um, so I I could dive into that 58 to kind of refresh on exactly what that was to
see what has changed. Um, but this that was a snapshot in time of what we provided, you know, back when we did our data request, you know, a year ago. >> Okay. So, theoretically then the spreadsheet that I'm referring to might be even newer than the data that >> Correct. Yeah. A little more dialed in
>> and I would hope less. >> This is Sean here. Just a >> Yes, please. Um, you know, I was just curious if it's looking at, let's say, 27 and beyond or or something like that, you know,
there's a significant amount of projects shown there, you know, for 2026. So, I don't know if the time horizons were apples to apples. I I don't know the document. Um, but but like Camden said, this is what we were originally provided. >> That that's a fair statement. I think factoring that 26 makes a difference. Um and just looking at this slide too like
the force main one um we've gotten an updated cost estimate on then on that since then. Um so there is some changes. >> Okay. So >> in our current spreadsheet in this data >> and if our current spreadsheet and and mask I realize you don't have that spreadsheet with you and and I I just am
looking asking Cam that uh if I look at the spreadsheet I would I would have more confidence in those numbers than what might have been given to Raph Talis at the time. >> Correct. But um as as as Sean mentioned, you know, when you factor in like the 15.3 million of 26, you know, that that kind of makes up a bulk of that difference there.
>> You understood understood. I I can see took a while to build this analysis. I understand. So, okay. Uh just I was trying to write the numbers in my head like I couldn't quite get to how we grew that much, but we didn't grow that much. The numbers I'm looking at 43 million at least out of that spreadsheet is more accurate. >> Correct.
>> Okay. Uh um I want to speak uh I'll jump into u again my slide 51 u may be a little bit different but it's the rate structure alternative. It's where we started talking about um you know um 3/4 inch pipes quarter inch
pipes and and and one inch pipes and uh if you could if you could roll somewhere into that area it's probably around 51 maybe 56 to guess you started at Yep. Yes. Right here. Thank you so much. Um actually no it's it's the rate structure
alternative I think is where I'm where I'm more interested in at least my title. >> That's page 51. Yeah. >> Uh, >> three more back. Sean or >> I I apologize, Sean. If you just keep
keep scrolling. It's It's where you said this one gets really complicated. It's got uh commercial rate structure alternative commercial building comparison. Um, I'll tell you what. I rather than rather than having you jump around, I'm just gonna cut to the chase. Right. So, >> there it is.
>> All right. I'll tell you what. Let's just start stop right here. This is good enough. So, the question came up as to um you know, uh what what you said was uh the bulk of our commercial properties are I'm just going to say less than one and a half inches um in in in the piping
size. Uh, and so it really does us probably very little good to talk about 8 in, you know, input pipes. We're the vast twothirds you said were we're one and a half or less. And uh, so I'd like to understand um, you know, to Commissioner Marriott's question, and this probably is not something we're
going to answer today. It's a maybe a question of the city staff. Um, I agree with Commissioner Marriott. need to be very careful what the impact is as we go through something like this that we don't end up uh just destroying all of our small businesses and our in our commercial spaces because we're trying
to quickly get to a space that is equitable. I I I am frankly on the right side of becoming equitable but not at the risk of of changing the character of our city uh by some dramatic moves. And so I would ask the city staff to just really help us understand if in my head
I I'll characterize them as either your little mom and pop shops or it might be a restaurant or it might be one of these big hotels and resorts. But start to think about how many of each fall in each of these sizes of 3/4 in or an inch and an inch and a half and start to help
us understand how many of businesses are fall into each of those categories so that we can then start to understand I'll make a number up. Let's let's say 200 fallen in 3/4 in size and we're going to change the rates from $95 to you know to something significantly higher to Commissioner Marriott's point
and we need to understand that we're affecting materially 200 businesses right there with one small crack and I and I don't want to do that. I'm just going to be upfront. I do not want to see this happen. And so I'm reticent to do any kind of change in this area until I understand what the impact's going to be. And I and I see this chart is trying
to get me closer to that. But I really need to understand what that means to St. Pete Beach. Um so I'm going to just ask for more work from the city staff to help us understand, you know, what kind of businesses are we talking about? How many of them fall into each of these pipe sizes? And then we can start to figure out, you know, is this really
going to be fiscally detrimental, you know, long term to these to these businesses because I don't want to see it happen. >> Um, >> sorry, I got a few more. >> I can't speak to the the types of businesses, but I I can tell you to um
when it comes to the the distribution of accounts across these three particular meter sizes, um, it ends up being roughly about 175, 79 that are 1 in, about 43 that are one and a half inch. Um, that's uh roughly about 86% of the class.
>> One more time, please. You cut out through there. I'm sorry. >> Oh, sorry. It it's raining here and some of my stuff turned off, so I apologize. Um, the uh 3/4 in is about about 174 uh accounts. Um 1 in is about 79 accounts.
Um 1 and a half inch is about 43 account. >> Okay. Um so that 3/4 inch is about 50% of of commercial class. The 1 in is about 23% of the class and about one and a half inch is about 12 uh% roughly of
the class. So in total roughly about 86% of the class resides in these 3 meter sizes. >> Beautiful. Love it. That was great. I don't need it from stat. Um okay that's that's really helpful. That that helps a lot. Um >> I think um maybe to clarify and um
Camden, can you do you have information to give them types of businesses that would require a 3/4 versus a one versus a one and a half? >> Um kind of based on their usage. >> No, but why why would a certain building
require a different meter size? >> Yeah. Ultimately, I'm trying to understand, are we impacting our our mom and pop shops? Are we impacting the resorts? Are we impacting the the little restaurants all over. I'm trying to understand who we're impacting. I I imagine there's no
experts on this on this panel about pipe sizes into each of these types of businesses. I'm trying to understand who we're impacting and what kind of costs we're we're we're considering as we do these things. Um, Miss uh, Accassio again, um, you had a very complex slide and again
it's my slide 53, but it's essentially you've got you've got year one 1-in pipes, year two 1in pipes, and year three 1in pipes all in one slide. Um, and I'm hoping it's pretty close to where you are right now. It's going to be uh it's going to be
three big charts all on one slide. If you can just quickly just scroll and see if you can find that for me. And it's probably below this if I had to guess. Um while you're pulling it up, u this this is where we saw some pretty dramatic
jumps. I'll just leave it right here. This is good right here. Right. So, uh, 1inch pipe year 1, year two, year three, right? And so, pretty big jumps. Um, if we kind of look at it, you know, we go just on the on 30,000, uh, 3,000 gallons of flow on a 1in pipe year one, it went
from $95, I'm just looking at the very top row on your very top left. It went from $95 up to 247 by monthly, right? Which is kind of to Commissioner Marriott's point. And so, I'll ask again, um, how does this compare to our to our neighboring properties? you know,
what's Treasure Island doing in a similar situation? What is Madiraa doing? And very specifically that I'm most interested in is St. Pete proper and Penllis County. Um because we're talking about dramatically raising our our rates on our on our users here. And
I would want to know if we're in line with what unincorporated Penllis County does similarly because if we can't get close to what unincorporated Penelis County is doing, uh then that would tell me that they're far more efficient at what they're doing and far better with their economies of scale and uh and I
would want to know why we can't get there. Um so I don't know that that that's an answerable question. Maybe it's again a conversation for city staff. Um and maybe uh Miss Aassio, you understand. um you know how we compare with this chart in front of me against
what what county rates would be and I'm talking about your your proposed commercial bill uh your very first column of your very first top left slide. How would those 247 down to 630 compare in a county scenario? Uh do you
have that data or or is it something we can give to the staff at some point? >> That's something I can uh compile and put together. um a comparison there. Uh the and um you know definitely put that together to show for you. Um what I will
say is what when we look at this particular one, so this is a 1-in account here. Um while the increases are very significant on the very low end and you know they're they're still significant on the high end of the flows. Um they're just a little more medium. The average flow characteristics for
this class, it's it's going to be more in the the middle. Uh now that I know what what slide we're on, so for instance, an average uh 1 in account um in the city is about 19 roughly 19,000 gallons of of um build flow. So that
would put them somewhere around the the 83 73% increase marker um in the in the first portion of the phase. And again, that's still very significant. I'm not trying to back >> where that was what that meter size.
>> Thank you. This is just showing you know um if there's minimal absolute minimal usage that would be the the impact of that sort of structure change. But um going back to um can a comparison be put together that looks to how some other neighboring communities uh handle this
class? Yes, that's something that's doable. >> Okay. Ideally for me again Treasure Island Madiraa St. Petersburg, Profer, and Penellis are the ones that I think are most directly impactful to us and would be good to kind of understand how we get within our peers. And I I don't want to make sure I point something out.
So, you just mentioned the average is about 19,000 in these 1- in pipes, right? The average use. And so to be clear, if I look at your three charts here, within three years, they'll go from $28410, which is the existing bill, up to
$637 within three years. >> 814 814. Thank you. 814. >> And so these are dramatic changes by monthly. >> Like this is this speaks to to Commissioner Marriott's point that if we're not very careful about this, we're going to run all these businesses out of
here. And I do not want to see that happen. So, I just I just uh I am I am very reticent in this area. I'm just going to leave it at that. And I think it's going to need a lot of how do we compare against others and how what are we trying to get to here and can we be as efficient as the county because I'm I'm still of the mindset as I've said
over several commissions that I I don't know that we can do the economy scales on our on our uh wastewater as the county can and I'm I'm in that mindset, but we'll figure out what we get to. I just I just don't like what I'm seeing with these dramatic jumps. Um all right, I'm almost done. I apologize for the
extra time. Um, uh, slide 63 for me, existing assets and level of service. And you don't have to you don't have to jump there, but essentially, um, the city's total conveyance system capacity is 3.194 MGD ADF is the is kind of the main
thing. And then at the very bottom, it says 18.8 of system capacity is available for new growth. And I just wanted to clarify because I hear it. I want to make sure I understand what's being asked here. I've heard that we don't have the sewage capacity uh to grow anymore. And if I'm reading this
slide correctly, it tells me we've got 18% of capacity still available for growth. And I want to make sure I'm understanding that right and not inferring it incorrectly. >> Camden, can you confirm the mayor's question? >> Yes. Um I think as as related to
capacity um we don't have the capacity to build out our city you know to the full density of of our comp plan as it currently stands. Um so there may be you know the window that 18% we still may have capacity but not to build out our full comp plan.
>> Right. But as of today we've got 18% capacity remaining and it may not let us get to where the comp plan wants us to but we have 18% capacity remaining. Am I correct? I'm asking not telling you. >> I believe so. Yeah. Okay. Okay. Let me make sure I just don't I've
I'd be beating a dead horse if I went into uh we've consistently got lack of capital investment uh planned over previous years. Um and I think I think that's it for me. Uh apologize for the lengthy question to
all in the room, but but thank you. >> It's okay. Um, mayor, I just need more direction because I've only re really heard definitive direction from you and Commissioner Marriott. So, I'd like to hear from the other three on what you need from us and what our next step
should be to either proceed, come back with a presentation. Uh, don't do anything with this. I I need some definitive direction because it takes multiple steps to put these rates in place. Any rate changes take
extensive outreach and mailings, etc. Uh, Mr. Cosier, I think it's first. >> Um, I think it's a great point that we've brought up about uh how these rate user fees can impact our businesses.
But I will say that we have basically an inequity right now between the different classes that we've looked at. That's very significant where we're at 138% for multi-use. For example, if you live in a condo, you're paying 138% whereas if
you're in a a single family residence, uh you're at um about 119%. But if you are a business operating here, you're at 77% of the rate according to the rate study. So
essentially um bringing us back to equity is very possibly going to create a hardship. And I wonder if for the class that is going to be affected the most if we could look at a hardship uh relief based on their
need. for example, their cash flow may allow for uh um variance of how we bring that particular property back into because obviously we want to shoot for equity and it's an injustice to leave
things inequitable. So, uh, I would suggest we think about a possible variance procedure for how to implement user fees that are considered to be fair across the board.
>> Mr. Maldonado. >> Yeah, no worries, Mr. Mayor. Thank you. Uh, I agree with the comments uh, expressed by the mayor and commissioner Marriott. uh we need to be very mindful of impacting unintentionally impacting small businesses and that's a great uh
point that that you brought up with that uh I'd also like to say that my intent and our intent should not be to overwhelm the users but it's time to stop kicking the can down the road. It's very clear that we have not as a city um
got in ahead of things and that's where we are today. Now we're we're picking up the broken pieces and we have to do it very strategically, very methodically, but we do have to reduce the inequity across the classes based on the
businesses, the commercial versus the residents. It's not fair that, you know, one class has been subsidizing another. So I do think that we have to rightsize that uh adjust it accordingly but at the same point just be very mindful that we
don't do something that's going to impact or hurt uh our small businesses. Also like to say that I think that to try to scale that uh to come up with a relief system is going to be uh very
challenging and very difficult. So I'd rather we take a strategic scaled approach and then if necessary adjust or look at options then but we need to take actions. Uh this is not going to be something where we're going to cover you
know all of our expenses but at least it'll get us closer to it. So it's a right start the right step in the right direction. And uh I'm very very thankful to the not only to Sean and his firm uh the city manager for pointing out the inequities
but also our finance board for all the work that they've put into it. Uh if you sat there and watched it uh they really thoughtfully made this the easiest digestible presentation. Believe it or not, theirs was even more brutal. So uh thank you to
them and to all the folks that volunteered their time. So thank you. >> Okay. I'm sorry. I'm not sure. >> Oh, okay. >> Um, yeah, I just wanted to reiterate that I'm absolutely in favor of the the right sizing our enterprise funds and,
you know, like others have said, it's high time that we fund these appropriately and that those funds be self- sustaining. Um, to Commissioner Maldonado's point, I don't think we need to over complicate trying to make sure we don't um, uh, have unintended consequences for the
smallest businesses. I think really, you know, it I'm I may be oversimplifying things, but I think we can really look at the the smallest of the small and the lowest users of the low users of water and probably, you know, I mean, I I
mean, I hate to say that we should meet with the businesses because we'll get in trouble for having secret meetings with the businesses, but but if if each of us, you know, made a couple phone calls to some businesses and asked them to look at their water bill and tell us what their usage is and what size their meter is, You know, I can tell you for for my
business, our our under this proposed plan, in three years, our water bill, our our our storm storm water bill will triple. We use 3,000 gallons of water per billing unit. And I have a 5/8 inch
water meter because I went and looked at it today. So, um, you know, so, so for us, it's not a big deal. we are a a big enough business that that amount of of of of dollars is absorbable. It's not a big deal. My concern is for the businesses that might only gross a couple
hundred,000 a year and then a a you know 600 or you know, you know, $1,200 increase in in in their overhead in a year is really really affects them. And so, um you know, I I don't think we need to over complicate it. I just think we need to make a
little bit of an adjustment at the at the lowest tiers of use. >> Mr. Robinson, >> I I I hate to be on this commission that's going to do increases on everything. This is just
sad and I hate to see that. Um, unfortunately, it hasn't been um properly adjusted or even considered in adjustments. Um although I will say I've been on this commission over a year now and last year we knew about this. We we
knew that the rates weren't going to weren't covering the costs. So we did know about this. Um so now we're actually making an adjustment for that. Um, so I'm good with the reclaim the storm and and I'm fine to look at what staff can
come back with for the wastewater if we have time on that time for that to evaluate that. I would hate to turn into a you know cheese ca cheesecake factory and um you know franchise only type
town. I'd like the idea of us having boutiques and having smaller uh you know uh non-franchised uh businesses here. So I don't want to put anybody out of business, but there
is an um inequity here. Um and it's fairly large. Maybe we look at something and we see, you know, instead of doing a 92%, we look at 85%, we look at something, you know, that's not so
it's going to be so impactful or hurtful to a small business. So yes, I think we can dive a little bit more into that, but I do feel that there there has to be an adjustment on that for equity sake.
That would be my two cents. Okay, I'm gonna I'm going to repeat just one last time for you, please. Um, I think we've all kind of said uh that we'd like to see uh you know us rightsize our our uh our revenue income
so that we are not constantly borrowing from general funds. I think that's some direction to the city staff. I think it applies across all of these funds. I think in general, as much as we'd hate to be the the bearers of bad news and the and the implementers of the right sizing, u you know, I I I can't imagine
that we keep kicking this can down the road forever and ever. So, I think you've got direction there. I think as we go to do this, um I I hear some consensus in in making sure that we understand what we're impacting in each of these uh in each of these areas. You know, I I'll just speak right off the
bat on on the on the uh the reclaim water. I think it went from $25 to $50. I mean, I think that's not something we need to study the impact of. But when you get down into those commercial pipes and those kind of things, I think we need to understand it and and it doesn't need to happen over three years. If we need to take a little longer to
rightsize it and make it equitable, I think we want to get equitable, but it doesn't need to all be born right away. You know, you consider drawing it out, consider different ways to get there, but I think we do agree that we want to be equitable. Um, and I and I think uh
for me again I see a lot of these large large costs and uh and these pieces are still in the in the wastewater side. Um, I'm putting aside the storm water for now because I think that is a much broader, bigger conversation to your point, city manager. But the next big
pieces are the wastewater and uh and I think we need to fully understand um what our options are beyond just jacking up our rates because if we can't if we can't get ourselves into rates that seem palatable to the communities around us
and to you know our our uh our big neighbors of St. Pete and Penelis, then we should look for other alternatives rather than jacking up rates that are that are insurmountable. And so, um, that's why at some point, Mr. Casio, I like to understand how we
compare against those those around us, uh, to see what we're doing to our rates. Um, because I think if we can't get competitive, then we need to consider again uh, looking for a way to offload that system into somebody that can be competitive and uh, and we'll get there. So, does that give you direction,
Miss City Manager? >> Yes. Thank you. Okay, thank you. >> And um this is Sean again here. Um you your points are your comments are very well taken. Um you know and and I at the risk of potentially talking out of turn
here, I'll still risk it. Um one item when it comes to the the the wastewater rate increases and and also the structure issues and and the the the overall concern about um impact. Those are very important ones for sure.
Another, you know, angle that you may have is also, you know, as you may recall, what we're trying to target for for wastewater are the the increases in revenue need are significant in and of themselves. Again, remember we talked about about 16% per year for the first three years followed by a 5enter in in
the last year of the forecast. Another thing to potentially consider would be a uniform dissimilar from how we're approaching reclaimed our storm water at the present and then in such time when the increases are projected to be smaller for instance
in 2030 and and I'll say hopefully beyond um where they're at a more manageable level potentially there could be the option to address design type issues like we've been talking about today at that point because one of the things that does occur um when you're
redesigning structures is any increase that's you know magnified because of the nature of the structure change. So it could make sense to um you know because I I thought I I heard some sentiment about you know maybe addressing this over a longer period of time. It might make
sense as an idea to address the the structural type issues and the equity issues once the the the the heavy hit of the the rate increases are are are borne out and then redesigned thereafter. there would still always be significant increases because just the nature of
that type of change. So that was just one one thought that that occurred to me uh there um you know in terms of comparability with your neighbors again that can that sort of um a comparison of bills can be prepared. Um you know there is going to be differences again like you had mentioned
you know economies of scale and um differences in in how they they handle things. does someone have a treatment plant versus someone purchases wastewater treatment capacity and you know those sorts of issues. Um so we can um we're treasure island here in St.
Petersburg proper. Um, so, uh, I just I I I wanted to to mention that I I hear the comments and that was just a a possible thought of an alternative there to, um, mitigate some of the the impact at least in the near term. But if if your goal is to address
those structural issues, there there will be u, you know, a higher impact at that period of time. >> Thank you. City manager, you've got direction that you need. >> Yes. Thank you. and Sean, we'll be in touch. >> Okay, I will I will uh just real quick
uh on a matter of just uh a time frame. Um we are going to break in about 30 minutes to 35 minutes if possible um to start preparing for the next meeting. So I I'm not sure we'll get through it, but but please be as efficient as we can. Thank you.
>> All right. My only uh comment here, we we covered the revenue sufficient I can just jump to the end of that just to at least uh address the overall change if if desired. >> Oh, Devin, can you explain what more he needs to talk about? I'm sorry. I thought we were
>> Yes. So, this was the first section where we talked about the sufficiencies. He does have a presentation on connections and what he was offering was to jump to some of the end of the presentation. >> Okay. And Sean, what how much time do you need for the remainder? >> I can do that in five minutes.
>> Okay. Let's go. If that's acceptable, I can speed run. So, um if if that's okay, then I'll just just jump to that. Um Yes, please. You know, we were also tasked with looking at your wastewater connection fees. Uh
these are are fees that are paid by new connections to the system or any sort of redevelopment that um takes additional capacity from the system. Uh the the idea being that uh growth and expansion pays for growth related costs. Um so that's what these fees are used for
at least a small uh benefit um in terms of um remedying some financial burden on rate payers because you have existing rateayers not subsidizing growth as much. So that's kind of a very high level overview of connection fees and who pays them and what they're for. Um with respect to then uh the analysis
here, I'll just jump to the end um to to keep it simple. essentially to to design a connection fee. What we look at is your existing investment in wastewater infrastructure. So that's your and we look through those asset records and see what is includable and what
should be excluded. Uh the bulk of the the fixed assets of the system are includable and in the case of the city. We also then look at the the multi-year capital program that 58 million you were talking about and what projects from that listing are associated with new assets versus um replacement type assets
or expansion assets and to the extent that assets are new or expansion related we can include those costs in the fee analysis as well. So based on the includable current investment in wastewater infrastructure today and the plan near-term future expansion in wastewater investment uh
through the the forecast periods, we take those costs that are includable and then divide them by your u your overall uh uh conveyance system capacity to get a cost on a per gallon basis of capacity and then based on your level of service which is 250 gallons per day. We take
that cost per gallon and scale it based on that. And that's what you see $3,216 per ERU or um essentially $12.86 per gallon of capacity at that 250 gallon level based on the analysis. So the the the investment that's been made to date since the last connection to the
analysis and then the planned future investment that's includable. When we account for all of that and the increase in capacity that that generates for the system, that increases the cost per gallon from $12.86 to about $18.60. That takes us from
to uh $4,649, an increase of of just under 45% or about $1,433. Um, so that's kind of the the short version there. These fees then scale by by meter size. That's how your code is written already. That's one of the
reasons why we also like the, you know, some form of design approach on the rate side, but I won't um get into that. So, this is how your your fees would then scale by meter size. Again, these are paid by just new develop. And if it's a replacement of a meter, it
only be paid to the extent that it's an expansion. If someone was going from a a 3/4 in to a 1 and 1/2 in, then it'd be some difference between the the two fees um there as opposed to the whole fee amount. Um you know, in terms of comparability,
your fees are are right now um on the upper end of the comparison. Um but again, that's a function of your just your capital cost as it relates to your capacity um instead of the $4,600 and change level. So again, you know, tried to speedrun that one without getting into the
minutiae, but essentially, you know, it's a it's a fee that's based on your your uh capacity related cost to provide wastewater conveyance service, your existing investment to date in your plan near-term future investment as it relates to that capacity and then applied on a perunit basis um to
accounts. Again, it's about just under a 45% increase on a perunit basis there. Thank you, John. I appreciate that. Any questions from the commissioners? >> Um, okay. I just want to I want to just
repeat what I think I heard. Uh, this is only born by new new stuff coming to the city. This is not anything new on any of our residents or businesses. Right. Okay. Um, and will you go back one slide for me? Just literally one slide. right there. Okay. Our current fees are
the light blue on the left and we're projecting to go to the light blue on the right. Um, and this is about connection to our wastewater systems. Uh, I'll only just make the comment that that again we're higher than the county and and we're projected to go even higher with this. And so I don't think
we have the economies that we need to get get where we need to be. So, um, thank you. Unless there's any other, you know, questions, I think we're ready to move on. City manager. Thank you, Sean. Thank you. >> Yes. Thank you. >> Good evening, Mayor and Commission.
Devin Schmidt, finance director. For the record, I'm going to try to take us somewhat quickly through some of these slides here as I know we're short on time. I'm just waiting for the slide presentation to pull up. For this next section, we'll just be focusing on our advalorum property
taxes. Um we'll take a look at um what uh some of the revenue history has looked like, how the millillage rate has moved, where some of those residents tax dollars go to, and um what the rate options are before you for fiscal year 2027 that we received from uh Penelis
County and it I need a different presentation, please. It's labeled number two. Excellent. Okay. So, as the commission can see, um this is our advalorum revenue from fiscal year 2020 through fiscal year 26.
The solid um dark figures are actually our audited actuals um the governmentwide from our financial statements and the 2026 is what we're projected. Um you can see here that we have received more but the key point is while our rate has remained flat or falling um that's rising taxable value
at work. So um looking at this um from our rate history the city has held a millage rate flat of 3.15 mills for 9 years from 2015 through 2023. >> Excuse me real quick. I'm sorry. Um is this something we can get rid of? I I
guess I just don't ignore that. Please hear. >> Oh yeah. >> It's just distracting me here. Thank you. Thanks. Um, yep. Absolutely. And so the commission actually reduced the rate in 2024 down to 3.0913, which is a cut of about 600s of a mill. So when the revenue is growing for the
city, that's not because of the rate, it's because of the taxable values that rose. Um, this slide answers a question that we receive um from residents. Where does the property taxes actually go? So using an illustrative $500,000 uh taxable
home, the total bill is around $8,135. Uh the city of St. Pete Beach keeps about uh 19% or $1,546 and the other 81% goes to schools at 40% uh Penelis County at 29% plus EMS and
any other special districts. This slide models out what the new Senate bill um impacts should it pass in November. And so you can see here that the Senate bill uh reduces some of the advalorum um by about 1.1 million or
about 7.2% 2%. Um, apply proportionally, the average, looking at that same $500,000 homes, the city portion drops from uh,546 down to about 1,434 or 112 in annual savings. Um, the point is that uh, you would see a modest
reduction um, should that pass in November. So, these are the three um, rate options before the commission. So as you can see um here our taxable value um that we received from the uh Penllis County is
5.17 billion. The rolled back rate um that is proposed is 3.075. And so by statute that generates the same revenue as the prior year and is legally a no tax increase. Um the current rate keeps what residents uh pay unchanged and it yields about 8 thou
$80,000 more than the rolled back rate. And then you can see there we have the 2/3 maximum which is a 3.8330 which requires a super majority vote and would generate approximately 3.8 million. So this narrows it to the average
homestead. So if we were looking at um our average homestead, the current rate a homeowner pays is around 1478 a year or 123 a month. The rolled back rate saves them about $7.50. um a year. The twothirds max would add
about $355 a year. And these figures are based off of just the current homestead value standard with the 50,000 exemption um that currently is included. For context, how our rate compares to our neighbors across the 24 incorporated
Penllis municipality, St. Pete Beach ranks 15th at our 3.0913 mills. So that's below the county median. Um you can see that Bair tops the list at 7 mills, St. Petersburg and Clearwater are well above the city as well. Um this does uh just to note exclude our county
and school districts, any of those special district levies. This slide is showing um where that actual tax base is coming from. So nonhomestead properties, hotels, investor owner occupied units make up about 71% of that taxable value or
roughly 3.48 billion generating 10.75 million of the levy. homestead whereas is 29%. And so as you can see here um when we're looking at some of what that base is um you can see where it would
apply to the different um areas. This is a different view of the same base. This is looking at our residential versus commercial use. So how those properties are classified on the tax bill. So about 79% of our taxable value is residential units across the 7,000 parcels. 21% is
commercial or about 850 partals. Here's a tale breakdown of um property use types. So um as you can see here, our single family homes is the largest single category where we're looking at 39% then condominiums at 25.5% and
hotels and uh condos at nearly 16% and then all those other buckets with commercial, multifamily and the smaller categories fill out the rest. This is a very detailed impact table um where we're looking at our average city tax parcel by parcel type in each of
these three rates. I'm not going to go through every row of this um but you can see that the rolled back rate versus the current is nearly a wash while the max is a increase. And finally, when we're looking at a 10-year cumulative view to make these um
small annual differences tangible, um for the average parcel, you can see the roll back rate saves about $100 over the 10-year versus the current. The 2/3 max adds about $4,773 per average parcel over that period. And the city roll back rate costs um on
average about8 million over those 10 years, while the max rate would generate 37.9 million. Um, so just wanted to propose and show what that 10-year look back is. And with that, um, I can take you back to, um, what the what our
options are before us for this year. Oops. Sorry. And I can answer any questions. just give an opportunity questions just looking around. >> All right. Thank you. I thought there would be. I just want to be clear the we
actually need direction and um from the commission tonight because this drives the entire um development of the budget and the legal process to actually adopt your advalorum rate. >> Understood. Thank you, Commissioner Robinson. >> These are our only options.
>> Um you could I'd have to confirm and maybe Ralph can help me out with this. uh city attorney. Um I think you could do something between any of the rates. I don't think you have to go to the full 2/3 max, but >> I'd want to confirm that with our city attorney.
>> You can pick a different millage number >> and I think they can always lower it. >> You can also lower >> you can lower it below the roll back. >> Similar follow-up question. Can we adopt a storm and a non-storm rate?
No, >> we have to pick a rate. Can have a contingent rate. >> You cannot have a contingent rate. >> What do you mean by storm or not? >> Let's say we we get hit with another major storm. Would it Could we roll up to a higher military? >> Well, I'm thinking of what the storm
season is. So, we're in the storm season now and I think it goes to October. >> October and November. And that's about when we need our final >> September is when you >> September. >> You could pick one now and go lower if
you don't get a storm. >> Yeah. Okay. So So yeah, maybe go with the higher in the event of a storm and then lower it to a nontorrm non-emergency. >> But we have to figure out the budget for both. So I don't know if you want two different budgets.
>> I see raised eyebrows. It sounds like I'm overthinking this. >> Yeah. >> All right. We'll we'll we'll continue that next year. >> If there's a storm, we'll dip into the reserves. >> Okay. >> Yeah. >> Okay. Just trying to be creative without >> We do also have to send So, if this
commission decided um any rate, we do have to let the county know so that those trim notices would go out to the residents and so um >> we do have to do that by the end of July. >> So, just to to clarify, we can go with a rate and then drop it if necessary.
>> I don't >> can they after we adopt the budget you >> after your trim rates notice I doubt you can right >> the trim will be the preliminary >> goes out I believe you can go below that and your real one you can't go higher >> okay >> okay >> so the initial trim notice could be
higher and then before we adopt the budget it could be lower but then we would need direction because we have to build a budget so we would need to know >> okay what portion of that do you not want us to budget and put into reserves is essentially the only probably easy
way to do do that >> my concern here would be just that going with a much higher as this is demonstrating with 3.8 on top of the assessments we're looking at >> is big is huge.
Um so that is my big concern on that. What is the number if we cover what we're what we potentially are going to lose with this uh um homestead exemption? Do we have that number again? It was somewhere here I think at 1.4. What was
it? >> 1.1 million in fiscal year. That would be for 2028. So that wouldn't be for this tax role. Um so it's 1.1 and then it goes up to 2.2 million assuming >> exactly everybody who's homesteaded now remains homesteaded and we don't have
more that come into the area or changes in those property uses. >> So 2.2 instead of this is you said it is 3 something. It's >> about four essentially >> 3.8.8. Right. >> Okay. >> So, um I I similar to Commissioner
Robinson, I think that um you know, raising the millage on top of raising all the fees is a is a hard number to swallow. We just talked about just some quick math that I think I did right, but I might not have. Um the the rates that we're talking about changing are going
to, you know, over a couple years. um cost all of our households, you know, around $800 a year. So, my my current feeling about it is that that I would be most in favor of leaving our millage rate the same. Um leaving it exactly
where it is are I I think there's still some some unknowns as far as what property values are going to do on St. Pete Beach as we continue to recover from the hurricane and how quickly. Um, I would imagine that by the time it's all said and done, we actually have more revenue than we're projecting because I
think things are going to, you know, property values are going to recover a little quicker than than maybe we're anticipating that they are. And then also that gives us room to raise the millage later if we feel like we need to. If if this ballot measure passes and
if a bunch of people then homestead their properties that aren't and if the the dollar consequences to St. P beach are a lot more than we're anticipating that they are right now. That gives us room later to raise the millillage if we need to where I feel like particularly if we go to that that max millillage now
we don't have a lot of room to do anything later if we need to. So So that's my current uh my current thoughts on that. >> Sorry please. The twothirds vote isn't a total maximum. It's just the level you would require twothirds. You could go even higher than that, but then you
would need unanimous if the legislation passes. They also say it'll be a twothirds vote to go to the roll back rate. So it says twothirds vote >> that'll be shifted over to the roll back rate in the but that's not now. That would be in the future if it passes.
>> Mr. causing >> I was wondering um madam city manager if you could highlight the difference impact twice that we would see between assuming we need a certain amount of money increase revenues to do things in the city with recovery from the storm's
uh user fees versus millage rate increase. Is there some reason why we would prefer one like keep rates lower? >> Uh no. So well yes you would prefer your
top priority in my professional opinion should be to rightsize and correct your enterprise funds. So, if you were going to take this in an order of operation because those need to be independent and they need to pay for themselves
and you if we need to borrow money, uh the commission can by a majority vote authorize that um financing and you don't have to bond against fees.
So it's very specific spend. The money collected by rates for those particular enterprises cannot cross-pollinate with any other fund in the city. So when we take in money for that purpose, we spend it only on that purpose.
So they're very very protected funds and um you only charge for what you need for that service. So it's not there's nothing discretionary about it. Um your second >> what was the point you were making about not bonding or can or can't
>> because bonding if you're going to bond against your advorum you need a two you need a vote from of the people. >> Mhm. >> So that would require a ballot measure uh a whole process that could take you typically takes about 18 months.
So it takes quite a bit of um level of effort from staff and yourselves and um so if you if you do raise Avalorum you can bond against it that's just a
separate process once you establish that regular revenue source that then we could go to the people to vote for and typically you would pick specific projects for that bonding. versus if we have higher fees and our
utility funds are self- sustaining. You're saying we can borrow money against those we can borrow money for those specific purposes against those >> fees. That's why you saw the projections were including >> against ad valorum
>> those loan options. We would still have to bring it back to you. Yeah. >> But that's why they were showing that there is a way to >> Yeah. >> to sustain those individual enterprise utility funds. >> Yeah. >> Well, I noticed the finance committee
recommended to raise the millage rates. I think they're just thinking that the city is underfunded right now in the recovery mode. I know I would comment that uh we have been severely financially impacted by the storms that we had and we've drawn our savings
account down to as low as we can draw it. So somehow we've got to recover back to a good financial position and besides that there's a lot of things that need to be fixed around this place still and
there's a lot of work that needs to be done. So somehow we've got to think about that. Um, I would say if we're not going to raise our millage rates, I don't know that we would want to raise I notice in the future slides here we have increases
of millions uh in some of the the funds budgeted. So, I feel like we would not we would have to look carefully at whether we're going to increase departmental funds and not increase the millillage
because how would we be funding that? >> Mr. Maldado. >> Yeah, I would uh say that this is another scenario where we're kicking the can down the road. I think the last you said 10 years 2015 to 2023 we've had a uh
the same millage rate. Uh I would go with the current flat rate comfortable with that and if necessary scale that down at some point but there has to be a slight adjustment uh just for the scale of economy
and and it's not very impactful. Essentially it's $80,000 difference. the same rate basically for the uh unchanged from the current year. So, uh I'll uh I
you know, we've talked about kicking the can. We've talked about how we've historically not funded our capital projects. knowing that we weren't funding our capital project, we actually dropped our millage rate and and made our situation even more untenable over the last few years. And I think that's just really
put us in a bind. And again, I hate for us to be the ones that have to go right and fix everything. This this commission here has to go and write the fiscal wrongs of the past. Um but um I think we've got to do
something. But I also am cognizant that that the fee impacts that that uh you know, Commissioner Marriott talked about are going to be impactful and we don't quite understand those impacts yet. And so I'm uh I'm probably leaning towards flat rate and um and then seeing
if we need to adjust, you know, from there personally um understanding that we've got significant investments to do. I I I get that. And I think, you know, personally, if we if we stop borrowing from our general fund over and over again by right sizing with the with the adjustments to our fees, our general
fund will actually have some revenue in it that we can then use in the right places rather than sending it off to every enterprise fund that we have. And so the bites of a big hamburger or whatever the right phrase is, I don't want to do all of this at once and then find out, you know, that we've we've
crushed our city in some way that's uh that that's not what we intend. So, I think personally my mindset is uh let's make the fee adjustments that we've agreed to, notwithstanding the one that we said we'd like to really understand what the impacts are. Um make those fee
adjustments, keep our rate flat, see how that impacts our our u our revenue in the ad valorum side of it, the general fund, because frankly, we'll quit borrowing out of it and we'll have more money to kind of actually do the things out of it that we want to do with the
same revenue that we had previous years. And so, um, I might be I might be of the mindset to raise it back up to where the prior commission dropped it, but I also understand we're doing a bunch of other fees. So, I'm I'm more in favor of just a flat personally is where I'm at right
now. >> I would go with the flat as well, considering all the other fees that we're looking at. Do we have a third flat? >> I don't know if we do or not. >> There's four, but >> I just want to make sure I heard it. I I know city manager looking for direction.
I just want to make sure. >> Nobody else wants to go on record. >> I mean, the emphasis here is that the residents pay is unchanged from the current year. So, uh, >> sort of >> kind of it's it's in the shadows.
>> Well, yeah. the user fees are what's gonna >> well and they'll get some relief theoretically potentially in November as well. >> Yeah. So >> we can always scale it down, >> right? Okay. >> All right. Thank you. >> Unless you can do something in five to
10 minutes on the last piece which is your feel free. >> Okay. It can I get the next slide presentation up as they're pulling that up. Um so this next section I'll take you quickly through what the finance budget review committee recommended um similar to what
the commission um decided other than um they did not take as deep of a dive into the wastewater connection fees. So that'll be something that staff brings back um agreement. So here with the reclaimed water was looking at um the alternative
storm water was looking at the um that as well. >> Back up. I'm sorry. You you went really quickly through reclaim, but it wasn't in front of us. >> Now it is. Thank you. >> Great. Um, storm water was similar to what the commission recommended as well. >> No, I'm sorry. I'm really sorry. You started with reclaim, but you didn't I
didn't see the slide. It was kind of >> There we go. >> Here we go. >> Sorry. >> Start with your phrase, right? Start with your statements. >> So, perfect. Um, the commission and the finance budget review committee uh were in you're in agreement here um with your board on that. You're in agreement with storm water on your board as well.
um for wastewater. Um this one it sounds like we'll be bringing back. So I'll just uh touch on on that, but uh they agreed with the alternative um the rate structure alternative as we're looking at those connections. Um that is also an area. Sorry, I was still
in wastewater. Um so an agreement there, but we'll be bringing back that wastewater section. And then the connection fee um was just again where we're looking at some of those newer connections as they come online. the finance budget review committee did recommend going with the uh full 3.833
mills and um they did have some areas where they wanted some recommendations um from staff as we're looking at our operating budget. And so some of those areas they wanted us to review um would be looking at our current spending um looking at
some of those fee studies and what we spent on fee studies, what our asset maintenance impact plan is. Um what our staffing versus contracts are. Um they wanted to look at a visualization and reporting and so some bubble charts around how of our funds um how how some
of those are playing together. Uh first quarter balance sheet. um they did want us to look at some county bed tax equity and then um again looking at some of that beach permit and um amidity pricing as we're looking at that.
So this next section um will take us through the preliminary operating department summaries. And so um just looking for just some very general feedback here on what our operating budget looks like. And so as we had met at the last workshop, um we were looking
to hold our FTE counts flat. So this is um what our city managers directed us to do. Modest CPI growth um look at having um phasing in some of our uh balancing and operating and maintenance budgets first. Um right now as we stand, so this is a
picture and I will say this until um you all stamp the approval of the adopted budget, but all of these numbers will continue to shift and change. Um but you can see here when we're looking at our total revenues versus total expenditures. Um this again does not include any of the enterprise funds or
what we just looked at for the millillage. Um you can see that we're looking at about 73 million in annual revenue and 88 and some of those expenditures and outflows with an ending fund balance of 26.5 million. Now again um open items that we still
have. Um so what we're looking at what we factored into our budget is a 3.2% 2% um cost of living adjustment. Um we have anchored to our May um CPI as that's as that's what we looked at last year. Insurance for employees is looking at
about 3.5% and that's based on our claims experience. We're still waiting though on our workers compensation for renewal property casualty and then um our capital will continue to shift as Camden's team is working on projects every single day.
So running I'll take the commission quickly through some of the what our current uh budget looks like. And so when we're looking at the commission last year um there was a proposal from the finance budget review committee to raise the salaries that each commissioner makes. So this is uh putting that back to flat and what is
actually occurring. Uh for the city clerk, we just had a a modest 1% increase um with our staff holding for the city attorney. Um this just reflects um a slight operating and some contractual reductions. Um everything
else remains the same for code enforcement. Um this is driven by required training and development. Um but staffing is remaining the same as there as well for our city attorney. Um we did include as well some additional
um special legal counsel um as we're looking at our personnel rules and regulations and then and then any other special counsel that we may need to contract with for community development. Um this is primarily around um any uh areas where
we had um some changes um as it relates to operating and professional services for planning and permitting in information technology. Um this is really consolidating all of our systems that maybe were in other budgets and we're looking at um recouping that by
way of cost allocation. So an example is our I work system historically was in the building fund and so just bringing those all into one housed um IT function in human resources. Um this is just looking at with our new NEOGV um system
that came online um as well as our some of our benefits all allocations there. Um in finance, um this is just modest operational growth uh primarily driven around that uh CPI
law enforcement. We received this contract from the um Panelis County and with that um they provide us what that next percentage increase is going to be. Um fire suppression. I did want to note that that is uh not a plus one FTE
increase. I apologize for that. Um primarily the increase that we're seeing here has to do with um the benefit and what they are looking at for their um union negotiations. So just the increase in uh what this commission has already approved emergency medical services. The major
decrease is uh the capital of 750,000 that we're not spending this year um since we did purchase um some capital equipment in that prior year and this is primarily recuperated by Penllis County. public services. Um we're just showing some lower operating costs around some
reduced um uh beach maintenance and partially offset by some rise in streets, but the staffing stands in the library department. Um we are seeing some higher costs for materials and programming. Um again, our staffing stands there.
in resident services. Um this is just dri drivenly main by the aquatics program and some uh growth in um participation there. And then in non-EP departmental, this large swing has to do with any of the transfers that we're um
looking at for fiscal year 26 versus 27. I'll take you quickly through the enterprise funds. Um this is primarily due to the capital projects. Um, as we're working through some of those enterprise funds, you'll see again these numbers will just continue to shift until you receive that uh preliminary
budget book. Reclaimed water. Um, pretty uh essentially flat storm water fund. Um, again, this is just looking at the changes around how we're seeing some of that capital um projects. And then the biggest swing
you'll see with our parking fund is we're utilizing any of those new revenues that we expect by increasing those parking fees to offset um capital projects or general fund. And so with that, I've received the millage rate direction and then just any feedback on the operating budget as
we're continuing to to build this out. >> Mr. Cosy, >> um I would like to ask the staff if they could take a look at the resident services budget. I notice we're increasing about 200,000 on that for the aquatics. But then when I look around
the city, I see that we are doing some restoration in some of the parks which I feel like are widely used by the public. Uh, at the same time, we're not doing some of the parks that are very popular, and I get a lot of feedback for that
right now. And I almost feel like we would do better to put budget into restoring our city parks back to prehurricane uh status from a landscaping and other
uh states. So, that'd be my request uh relative to the departmental budgets. Is that you understand what I'm asking or? Yeah. >> Can I ask maybe maybe uh Mr. Mills, can you come back up here please and and or maybe you know our capital plan improve
capital projects I believe includes some of that some or much of that uh fixing of those parks I think is also part of the capital piece versus the parks and recck room. I'm asking, not telling. >> Mayor could >> with 10 minutes to go, is there appetite
to maybe move this to the next meeting discussion so that you have time to reset for the next meeting? >> That sounds great. >> Okay. Yeah. >> Thank you. >> Have no questions. >> All right. So, we'll we'll adjourn right now and uh I guess we'll pick up next meeting with a few questions. >> 6 p.m.
>> At 6 PM. Sorry. Thank you, >> city attorney. >> Good call. >> Okay. Thanks. >> Yeah.