Good afternoon. We call the August 21st meeting of the Budget Advisory Committee to order. Roll call please. Chair Bergman here. Here. Here. Miss
McKinney. Here. Mr. Marcus. I have not heard from him, so I'm not sure. Okay. We're going to start with new business. I'm
going to ask Ron to do a budget update. I'm getting a. Okay.
We're still working on the budget. Five, six months later. Just briefly. Stuff you already know. But the city manager met with department heads. Budget.
The budget committee here met with all the department heads. We had the budget public hearing survey was on June 17th, and we had two budget workshops with the board on July 15th and
July 29th, and also the next day, on July 30th, we had a separate budget work session on the study. Items still being worked on is the compensation
or pay study. The Stormwater Revenue Sufficiency Study, and the Water and Sewer Revenue Sufficiency Study. They're getting close to being done. We're planning on the stormwater and the water and
sewer revenue sufficiency studies going before the board on September 9th for readings on on the rate increases. This is the budget as it currently
is compared to 2026 and 2025. And as you can see in the top left, the budget is 120,994,006 11. Now it's a sizable
difference from the previous year. I'll probably be mentioning a lot, but there's $37 million worth of capital in the in the budget. I went back a few five years. We've usually
averaged about 12 million of capital every year, from a low of 8 million to a high of about 13 million. And off to the right there, it shows that the
main capital projects, we got 17 million in water and sewer fund, 7.3 million in the penny fund and the CRA fund. We have almost 3 million stormwater
fund. We have 3.5 million of capital. And then we have the new golf course clubhouse at 4.2 million. And just to try to
compare the same numbers budget from 25 to 26, there's a total budget of 120 million. But highlighted there, there's the capital of 37,100,000. And down
below it shows in the graph the capital outlay is 30% of the of that budget in prior years. It's usually run between 14 and
15% of the budget. Make a donation now. I put together just a slide to break out that 37 million of capital for 2026.
And as you can see, the water and sewer is a 17 million stormwater, 3.5 million streets paved in brick or 3.6 million sidewalks, 400,000 public
safety, 1.8 million. Golf course, clubhouse 4.2 million. Culture and recreation 1.4 million. And transportation. Water that is a combination of
3.6 million for the Craig Park Seawall phase one construction and 464,000 for design work for the bayou dredging. And a
little bit more detail on the projects. These are all the public safety projects for 2000. The five years 2026 to 20 39.1
million. As you can see, that's police and fire items that they're needing over those five years in blue. I've got that in blue up there because that's a
reserve for the fire trucks, like the first one at $400,000 a year that we just got approved, the purchase of fire truck, it takes four years to get them. So our plan was to
reserve the money aside in the penny fund for that, for that fire truck. The ladder truck. So when we get it in 2029, we've got the 1.6 million to pay for it. In the past we've
been leasing these fire trucks. So we're going to make an effort to try to reserve the money aside, which the financing helps make us accomplish that. And the in the next the next fire truck is one
that they need. Two years later at $325,000 a year, and then another one planned that third truck down for starting at
350,000 in 2030. These are the stormwater projects for the five years 22,026 through 36.3 million. I won't go down and
read all these projects, but take time and look at them. But. These are the streets, brick and paved. The the ones
highlighted are the brick streets. This is a five years of course, and we've got 5.2 million of street projects over
the five years at 5.2 million. And I don't have we didn't have the five years for the sidewalk projects, but this is what we had for the for 2026. The
$400,000 worth of sidewalk project. I threw this slide in. I had it on another presentation to the board, but just try to compare. In the yellow on the far right is what
we've usually budgeted for, like stormwater projects 400,000 a year, street project $150,000 a year, sidewalk projects 200,000 a year. Basically on our pay as you go
method. Then under 2026, I got highlighted the projects we just mentioned. So 2.3 million for stormwater streets, 3.2 million, sidewalks, 400,000.
Just so just trying to show you the difference between, you know, with the financing, we're able to do more projects. And then over the five years for 26 or 30, you'll see the 6.2
million for stormwater, the 5.2 million for street projects and 2 million for sidewalk project. The financing we've been
talking about, these are the projects that we've been talking about financing. We've got the fire station, 70 construction, 6 million Craig Park, seawall construction, phase one, 1.6 million. The
stormwater projects 3.5 million, golf course, clubhouse 4.2 million. And Beckett Bridge utilities 4 million. And sort of notated with letter A,
there's you know, when we do the financing, it makes funds available for stormwater and street projects and other infrastructure projects that may come up, which may be Craig Park, Seawall Construction,
Phase two and River, the Bayou dredging. With the stormwater financing. We're also able to we're doing with the rate study. If we keep the capital projects in the stormwater plan, but we
don't have the financing, the monthly increase to the residents could be almost $6 per month to try to do those capital projects, but with the financing, the monthly increase
per resident would be $2.50. And pardon me. Much better. Yeah. Much better. And that was what I recall. I was going to ask you this, but you brought it up. The main reason that
we're considering doing the financing in the first place is a to get the projects done earlier, but B also to, to kind of spread it out so that there's not so much impact. And
the like is if we paid as we go, that's where the $6 a month would be to do those all those stormwater capital projects keep them in the budget. It would require $6 increase to the average, you know, single
family residential home. Right. And then financing it, it's just the $2 and 50. Right. That's sort of the incentive I think for the finance. Yes. The
$2.50. Yes. Golf course. And fortunately in a solid position, they've got over $1 million in reserves, but not enough to pay for the new clubhouse outright.
So we've always talked about financing for that, but they are with their revenues and expenses where they are, they are able to handle the debt
service, which would be about $490,000 a year. And then the last item was the Beckett Bridge utilities. We still
we're we're it's mandated by the county, but it seems like it keeps getting pushed back from when we're here, it's going to be done. So the financing we're still at 19.3 million of financing, but we
might be alternating another form instead of Beckett bridge utilities in the budget is another 4 million to accomplish some of the public services. They got electrical work electrical plant. They need to
do about a $5 million project. They want to do more water lines, get some more clean water lines in the city. So it might be that instead of the 4 million for Beckett Bridge
utilities, if more immediate concern might be the 4 million for the electrical projects and the new water wells and the new water lines. It was talked
about that, yes, we borrow money, it cost interest. So 10 million, $19.3 million at 4% interest for, yes, 4% interest over the ten years comes to
$4.3 million of interest. What I did was I, you know, we talked about versus going on the pay as you go and the projects increase in cost if you wait. What I did is I go,
what, you know, with the financing, what is the cost difference? And what I did is the cost construction index is 3.8 3,000,000%. I'm sorry, I got it from our consultant that
does the rate study. Is that a that was a per year increase of 3.8 per year that they estimate. Yes. And what I did okay. Maybe for pay as you go, we're able to do $2 million of projects a
year for the ten years. And then with the construction cost index of 3.83%. And what it basically came to is by with the pay as you go, we be, we be,
we got a million. So if we go ahead and do the project I'm sorry, I'm confusing my words there. If we go ahead and do the projects now, we're going to save almost $1 million based
on the inflation cost of the 5.5.2, almost 5.3 million there. Right? I sort of you know, that's based on the construction cost index. What I did also, I was just curious
because I know some stormwater projects have been on a list and I found six of the same exact projects from ten years ago. They totaled 2.5 million.
Now in in the rate study plan, they're close to 15 million for these same six projects. So they're going up 12, almost 12.5 million for these same six projects that were budgeted ten
years ago that hadn't been done to now. So I thought that was sort of interesting. Getting away from capital. So we go to the salary increases. The
police and fire union increases their third year, the third and final year of their three year contract is costing 470,000. The general employees pay
increase per the pay plan is 6.79%, or one. Almost 1.2 million new positions in the budget, some funded, fully funded for the for the full
year is a yard waste operator out of the sanitation fund, a code enforcement supervisor, part time a building department tech. We've got one already. They want to move her from
temporary part time to full time, and to try to watch the money. In the first year, we're doing half year funding for they, an IT specialist, a police dispatcher and an HR
admin person part time, they say, funded halfway for half year. Well, they'll go hire the person starting April 1st or for the first year. We're
trying to save some money on the getting those positions. This is a total city budget, 120 million, but just the revenues and highlighted are
the big increases of 5.8 million, which is the public's the public services water and sewer electric grant that they're getting for 2 million. The Craig Park seawall, phase one construction 2 million. And
there's a sustainability grant for 400,000 charges for services, highlighted as a $1.9 million increase in the majority is for the enterprise funds. Basically, the rate
increases for water, sewer, storm water. And sanitation. Miscellaneous an increase of 3 million. And that's mostly that is the PFAS settlement that
they got in the water and sewer fund settlement there. And then of course, the loan proceeds. So we've got an increase of 19.3 million for going out for
a loan for to do these capital projects. And then down below is 3.6 million. But that's mostly for using the reserve money from the CRA for the projects, mostly Orange Street
construction, which is coming in at 2.5 million being charged out of the CRA. A little bit on the general fund highlights,
we've maintained the millage rate of 5.37. You might already know this stuff. Property tax value increase 4.07%. We funded the police and fire union
contracts a third and final year. We funded the police and fire actuary requirements and funded the General Employees Pay Study. I threw this in
there, I think, for a previous presentation, but they always like to compare us to the other full size cities in the in the county with a population greater than 20,000, we're
still the lowest of the five at 5.37 millage rate. Some other additions to the budget. I know the city manager was trying to
get some more marketing in the budget. They funded some economic development down at the sponge docks, and there's additional money for training of employees. And the general
fund numbers. As you can see, it's basically highlighted. It's it's it's a salary increase of 1.7 million. Operating went down. That's where when we first worked,
when I mentioned to you back in May that we were working with the budget, we didn't know when, how much if we're going to have a property tax increase, if at all. So departments went in and
actually cut about, I think about almost 800,000 operating out of their budgets. So instead of a $600,000 increase in operating, we had a $200,000 decrease in operating. And down
below it just says, of course, general fund is 73.5% personnel costs. The revenues in the general fund highlighted there
the 596,000. That's a 4.07%. That's what it brought us for an increase in the property tax revenue and charges for services 570,000. That is
mostly we got. Most of it is budgeted on the low side last year, but we got a new fire unit that the fire County is firing our fire department. So I was on the low side on the
budget last year, which works out really good this fiscal year for our actuals in 2025, but also for budgeting for 2026.
I had this slide in another presentation too. I just thought it was interesting, but that's me with numbers. But what it's just trying to show is over the past five years, what's the increase in the
budget over the last five years? So in 2022 the budget went up, you know, 1,295,000, which is 4.84%. It jumped up to 2.9
million in 2023, or 10.65%, and in 24, 2.1 million or $2.1 million increase. And then in 2025, $2.7 million increase.
And then this year, we're at the lowest of those five years at 4.06% increase. And this is my last slide just to update
you. The next is the first public hearing on September 3rd, and then the second and final public hearing on September 17th. And on the 18th I'm going
on vacation. No, no no, please. No vacations planned. Yeah. Questions. Okay. Just one, because we were talking about
the financing of it. So how I'm kind of thinking about it is, you know, why are we doing the financing. So you kind of it's a way to sort of structure we know what projects we need to
get done over the next ten years. And, you know, you you have the numbers in the estimates. If we do it one way with the pay as you go way, you've kind of got that risk that inflation would kind of
eat up the budget, meaning we could kind of end up paying more in the long run if we did pay as we go. But if we finance, we could maybe get things done
sooner, kind of smooth out those payments and not have that inflation risk. That's estimated by you said, who provided the estimate of the 3.83% is a construction cost
index from our consultant is doing our revenue studies for stormwater and water and sewer. Yeah. Even if it was lower than that, it seems like it still makes sense to do the financing.
Yeah. If they want to get these projects done, you know. Yes we would save some money on the cost wise there. Yeah. I think that was it for me. Everything else we kind of talked about
not nothing seems new from from prior discussion. You indicated in the budget the the pay thing
is not finalized yet. When is that anticipated to be finalized? This coming Tuesday, August 26th. Okay. We just had
a study not long ago, though. What this most recent one. What was the driver of doing that one? This pay study. We never went out to a third party to do it. It's always been internal
okay. And we piggybacked off Dunedin study a few years ago. Right. No, we went out to bid ourselves on this, on this vendor, on this vendor. The dean did do one, but a
different vendor. Okay. Were you happy with the vendor and the process that they went through? Yes. From what I haven't been totally involved in it. From what I had, it's been they've been very helpful.
Okay. There were some questions that came up about we we didn't talk about pay study because it wasn't out yet at our last meeting, but at one of the budget meetings, they were
talking about the pay study, and one of the commissioners had brought up that there was an original. I don't know,
there was a there was a first draft of a first draft. Okay. And then there was a second draft, which changed upper management's to be higher. And some of the lower people to be
lower. And I was just wondering what what was that all about? Because that's bringing up a lot of questions, especially online. I didn't I really wasn't involved, but I know they were trying to make
corrections to to the, to the dates, say somebody their higher dates. So when and when they're in that position or got that new position that was
based on how many years of a. I thought I saw Bobby, he worked on it more than me, but the compression on the issue and we had to change some dates there when they got hired to the
correct dates, and also the definition of what the actual job was, right. Needed some correction, I think. Okay. So normally there's a lot of tweaks that go into, you know,
what the what the consultant got in to try to correct them. Okay. Yeah. I really didn't understand what he was talking about. The difference between the two. Just bring it up. I
think he might have found some of the lower people might have gone up higher, but we ended up with 5%. Right. Well, we're doing the minimum. What did we end up with at that meeting?
Because I'm confused about the Cola originally was 3%. We've we've the minimum. It's been raised to 5% now. So the minimum somebody will get will
be 5% increase okay. Across the board everybody. Yes. What's the what's the basis for that. Because Cola at three seems more reasonable right now as
opposed to five. Is that just any data behind that or just that's what we've decided. No real data just to try to bring the employees up to the where
they should be. Are we having a lot of attrition or people leaving for higher salaries? I've seen a lot of them stay because I don't have vacant positions, so I don't have to
pay for it. Yeah. And I mean, I certainly want everybody to be compensated fairly, but I know in the past few years we've given fair and substantial increases. And, you know, that's just compounds every
year. So I'm just wondering is there going to be a, you know, a slowing down of this. Are we caught up. Yeah. Are we finally caught up. Well, I think you know, the previous city manager
was trying to do that over the years, but with his own internal studies. Right. Trying to especially this lower salaries, bringing them up and getting up to that minimum wage, which I think we're over that
now. Yeah. So do we have a policy or a standard of how often we do these studies? The compensation studies are I think that's been mentioned to
try to maybe every three years try to do a study. Yeah. Does that make sense? Like I'm sure it's an expensive study. I'm sorry. It's the next I mean, is
it how. Like it's an expensive process to go through, right. Or was it. Not too bad. It really it wasn't. It wasn't too bad. It was. It was I think
about $40,000 for it. Okay. I don't know why I thought it would be more than that. And then as far as the loan goes, I'm like, all for it. I back it
100%. But I do have questions about the money that's been allocated in the budget that would be moved to under financing. Then what that freed
up money is going for? Well, you're able to do more of the street projects, the stormwater projects. We're also on the one slide. Is there a list of
already decided what we're going to do with that? Yes. Freed up money. Yes. And that's available. Yes. And when you do a loan for the IRS you have to spend the money within three
years or else you have some might have some arbitrage issues. So yes, it's already planned out over the three years. And one other thing is we're able to I put this back on public safety. We usually
lease fire trucks, but if we're able to do the financing, we're able to go ahead and maybe be able to budget cash and reserve for these fire trucks in blue there. So that would come out
of the freed up money that, yes, because of the it would make us available to. Yes. Have that reserve instead of going out. Like I said, the new fire truck takes four years to build. We
would get in 2029 1.6 million. We can reserve it off $400,000 a year, if not in about three, three and a half years. We're going to have to be looking on another lease. But we've been
leasing these fire trucks. Because it was like, how much of how much of the money actually is going to go under the financing if it gets approved? That was under the
budget. Is it like $10 million? Like there was 4 million for the golf course clubhouse? Was it 19 all in or you mean all the different projects added up
to the total? The 6 million for the fire station, 70 Craig Park seawall, 1.6 million. The stormwater projects 3.5 million. Golf course, clubhouse 4.2 million and Beckett Bridge
utilities 4 million. And out of those, which ones are already in the budget? Without the loan and next year's budget? Well, they're in the budget right now
with the loan. But if we don't have the financing, I know the stormwater projects will come out to the golf course. Clubhouse will come out along
with Beckett Bridge Utilities. I guess what I'm trying to ask is like. The fire station is currently under the budget without the loan correct
budgeted, and so is the golf course. That's like 10 million right there. Well, we don't have the finance. We don't have the money for the clubhouse. It's not already in the golf
course is in its own separate fund. Right. They don't it maybe has a little over $1 million in reserves, which is good. They used to be like $1 million in the hole not too long ago. But. So they don't
have the money alone in the golf course to be able to pay the whole 4.2 million. But currently, without the loan being approved, the golf clubhouse is in our budget for 2026. It's in there. But if we
take out the financing, I'm going to be taking out the golf course clubhouse because we're not going to have the money for it. If the financing is not done, these projects come out.
It is the Craig Street seawall already in the budget, or is that something else we would lose without financing? Well, the Craig Park sale we did, we
do have budgeted in the 2026. We did have some reserves for it, but by being able to finance it, we're able to use that money that we're freeing up now for stormwater and street projects. Yeah, you
don't have to tell me on the loan. I'm just wondering how much I'm not trying to sell anything. You don't have to sell me on the loan. I'm already sold to give you the facts. I'm just. I'm trying to
figure out in the budget without the loan that because the loan hasn't been approved yet, right? Correct. So currently, the budget that we're looking at without including the loan, how much
would be freed up for other things? What's the total amount that would be freed up to do other things without the if we got the loan? Oh, that's why I
say if we if we have the loan, yes, we have money that's freed up not just in 2026, but 2027 and 2028. And how do you know about how much that is that
would be freed up by getting this loan roughly about in the penny fund, about 4.5 million, which can be used for other projects in 26, 27 or 28
projects coming up. Like they've talked about bayou dredging, I've heard cost of $5 million. We don't have that money. 5 million for bayou
dredging. They got the design work that they're going to be doing, but we don't have the money correct for bayou dredging or or Craig Park seawall construction phase two.
We don't have any money for that right now either. I just would like to see something that the plans for the freed up
money, because people are concerned about that people are, you know, I'm out in the world and they're concerned about pet projects being done with the freed up money. So we're taking
this loan out, and we're going to transfer stuff from the budget to the loan. And now we've got this freed up money. What's going to happen with that? Well, if we go back to this slide on the stormwater, this is a five. This is what
it's paying for. You got five, 6.3 million of stormwater projects that are being freed up. Otherwise there's probably none being done. Same with the
street projects. If we don't have the financing. There's not going to be much we can do of these projects. Okay. I just
want to have answers when people ask, oh, that's okay. I call it sometimes I call in the penny fund. I've been always sort of been living on the edge. I usually have about 200,000
left, and we've just been doing what we could from year to year. Anything we can't do, we just sort of push it out. So the financing does give us the capability of doing these
projects now at a lower cost. Okay. Anything else on the budget update? Thank you. That
was comprehensive. All right. I asked for the second item to be put on here, just to maybe get some feedback. The. So is the
July 15th first budget workshop. I attended and presented the recommendations that this committee had made. A couple of them which have budget impacts.
We already already talked about the millage rate. I'm more interested. Is there any update because I wasn't able to attend the follow up meeting. I was out of town in terms of the
recommendation made for the mayor and salary and commission salary increases. Has that been considered at all at this stage? I think it's been considered, but there's been no firm
decision made yet on that. That's what I'm looking for is where we where they stand, where we stand on the recommendations that we had put forth. Nothing firm. I have nothing in the budget for it
yet. Okay. Any questions on that? No. And on the fund balance minimum, I plan on bringing that before the board in September, either September
9th or September 30th. I've got something number three where you said review the mayor commissioner's salary every three years. I've got something in my budget files. I got a
tickler list of. Remind me to do that. Okay. And as you know, we kept the millage rate at 5.37. Good enough. Thank you.
Anything else? No. Thank you. All right, let's move on to public comments. Any public
comments? Board and staff. Next meeting. What date is the September meeting scheduled for?
Nine, three and 914. I just wonder, do you want to have a meeting then, or do you want to wait or do you? I'm wondering what the date is in terms of whether the budget meetings are
17th, 13th. I believe that your I'll tell you right now, the 18th, September 18th, the third Thursday. I don't know what the meeting dates for the third. Oh I'm sorry, I'm talking about
this meeting or this committee would meet again. The 18th. The 18th. Okay. And one of the other two meetings are what, the third and the 17th? The 17th would be the final public
hearing on the budget and military. I think we should meet then on the 18th, because I can't meet in October, I'll be out of the country. So I
can't go on vacation. I'm joking. On the ninth. Okay. Yeah. I think we should have the September meeting is that
follows those two budget meetings by the commission. Well, you need time to put anything together or you're good with with that. Like you'll have everything. Might
be similar to today's just updating the numbers probably. And where we are at. Because we could also meet early in
November when you're back. Irene just wanted me to let everybody know Citizens Academy. We still have about five slots
available, so in the first one is September 10th. Are you saying we pushed back the
September meeting? Well, I do, I guess I'm just wondering, is it useful to have just an update of the numbers on the 18th, or do you want to wait till you're back early November
to have a more thorough update? I have no preference. November might also be able to give you an update on how the finances are for fiscal year 2026, if
that matters. Anyway, what does matter? But. I have no problem if everybody else thinks waiting till November is fine.
Yeah. So okay, we'll go for the next meeting in November. Any future agenda items? All right.
Seeing none. I'll adjourn at 233. Thank you. All. Which?