 All right. Chris and Tom, it looks like we are live now. Okay. We'll give a couple of minutes to see if our wayward council member finds his way in. Up there he is. He popped up as a guest. There we go. If it's going to happen to anybody, it's going to happen to me. Well, I'm glad you're in the meeting or is everybody ready to get rolling? I think so. Okay. Let's go ahead and call the roll. All right. Chair Rogers. Here. Member Schwatt home. Here. Member Sawyer. Here. Let the order reflect that all subcommittee members are present. Okay. Let me. Sorry, my agenda is actually loading one second. Okay. Let's go ahead and start with public comments for non agenda items. For folks who are in the meeting, if you have a public comment that you'd like to make, go ahead and hit the raise hand feature on zoom. Typically in the bottom right corner of the screen. All right. I'm not seeing any. Did we have any recorded voicemail public comments for today's meeting? Okay. Great to know. We'll move on to item number three approval of the minutes. I know at least council member Sawyer was able to open finally, November 12 minutes. We heard about that earlier, John. Were there any changes that either of you had for the minutes? No. Okay. Great. Then we'll show those as adopted. Or adopted as presented. Item number four. City operations and maintenance budget. I'm going to be turning it over to. Jan Mazik. Jan's are newly minted chief financial officer. And we're really excited to have a. Jan on board. And I would just like to thank her for all the work she's done to date and actually thank Allen for all the work he did. As the interim chief financial officer. Thank you for joining the team, Santa Rosa. And you're going to be very impressed council members. Good afternoon, mayor council members. I am delighted to be here and nice to meet all of you. And I'll look forward to meeting you in person at some time. I think the goal of today is really to provide two things. One is a snapshot. Of where the city ended its mid year. In December. And begin the dialogue as to, you know, short and medium term strategies. Financial and operating strategies. That may frame our outlook ahead of next week's. Goal setting process. And so Alan will deliver the presentation. And so at this point I'll turn it over to him. And then we'll talk about, you know, Perhaps what some of those strategies might be. Thanks. All right. Good. He's going up. Next slide, please. And let's Jan's already covered this mostly. So let's hop into the next slide. So these are our. A lot of these are what we went over on Tuesday. We wanted to, we wanted to, we wanted to set the context for the further conversation that we would have. At the end of the presentation. So. And then if there's any questions that come up from this, that maybe you thought about since Tuesday, we're here to answer those as well. But as you recall, these are, are baseline. Forecast. So, the top one shows where we were forecasting in April of 2020, when we, when we called management partners in to help us look on how the COVID-19 potential recession would affect us and loss of revenues and all that. And we also, they were also looking at it in terms of the. We were also looking at, we were looking at hiring sales tax measures that would start in. Fiscal year 25 through 27. So then the council made some adjustments during that budget process. And one of which was to. Maintain a general fund vacancy. And also to return some unused project dollars in the general fund back to the general fund reserves. Those were meant to be short time measures to bring our reserves back to some sort of comfort level, knowing that we were going to need to draw down greatly from the reserves in order to pass the current year budget. Next slide, please. So one of the things from, that we showed yesterday and the management partners went through in greater detail back in September were four scenarios that they had. Again, they had three main assumptions that the vacancy amount would be there that those $10 million of reserves would stay in the end to sign reserves and that we would renew all three tax measures. And then they developed some other scenarios based on the use of or potential use of PG and E dollars to augment the 10 million that already was brought back to the, to the reserves. And in doing so, it would provide some time to allow us to kind of write the ship, if you will. Otherwise you're looking at cuts immediately. And so this is where we were, we would have if, if we use at the time $30 million at the PG and E money, there would be no immediate budget reductions needed. And no immediate ones needed. But then as we moved down that level from 20 to 10 to none of the PG and E money, there is cuts that would need to happen starting at $1.5 million in this next fiscal year. So fiscal year 21 22 all the way down to, it was $8 million in 21 22. If we use none of the PG and E dollars. Next slide please. And so I think what this illustrates is that is that your were clearly did not want to use PG and E dollars for ongoing. But what you, what we were looking at was a way to kind of shore up the problem and allow us to come up with a strategy to react to this. And, and, you know, obviously if we needed to cut $8 million in a year, it's going to have a pretty significant jewel to the operation or to the organization. Next slide please. So, you know, one of the things that I talked about on Tuesday is, so here we are in the year, how do we look? And as I mentioned, we, we did dip into a reserves. The costs that we needed to provide upfront for COVID relief, especially for our homeless community was obviously a lot greater than what we expected. And, and there were other needs that we pulled out of reserves to the tune of 8.7 million dollars. And then what we found is that while we were maintaining our $5 million of permanent salary vacancies in the general fund, unfortunately operating needs and, you know, the glass fire other emergency events that we just seem to not be able to shake, also aid into that because we needed to do more overtime and, and that of course would, as we project out, would eat into that salary savings. So just to kind of illustrate that I didn't do it on Tuesday, but just to keep in the back of your mind is we look at just the straight overtime, not the strike team overtime or the other ones like that holiday overtime, but just your straight overtime. The general fund was at about, had spent about 87% of its budget by the end of December. So you can guess that there's not a good likelihood. In fact, actually we had that atmospheric river come through us, which was an EOC activation. And that probably drew some more overtime as well. I know the fire department of staff, a lot of that comes off of overtime. So the odds that we are going to be able to maintain our overtime budget through the end of this fiscal year are non-existent. We will blow past that. And that is why that's how we're getting our estimates that you're going to eat into that salary savings. Alan, can I, you know, I need to interrupt you just for a second. And I, I missed this. I wanted to mention that the other night, but I thought it was probably better left to the subcommittee. Could you go back to the slide, the prior slide, just the one right above this one. See in the comment under the 10 million of the 95 million trade off is that higher PG knee use reduces level of cuts. Yeah. And I just, I know it's, it's, it's, it seems simple. But it, I was confused. So how does using more PG knee reduce the level of cuts? So. Yeah. If you could just add. Fund in there. Yeah. If, if anyone were to read that, like I was reading it, they would be confused. So I just, I know it's, it's a, it's a simple thing, but if you could do that, I appreciate it. I think we'll call it settlement. We'll call it settlement. However you can get that word in there would be great. Forgive our shorthand on that. No problem. Thank you. Sorry to interrupt. All right. So, So. On the positive side, we were in November able to. Extend two of our quarters and sales tax. Taxes. For 10 years. So that is a, a good thing. We still have the public safety. Special tax that will expire in. 2025. Yeah. 2025. And. Right now the, I believe the long range forecast. Has the assumption that if that. That if, that if that tax isn't extended. That those costs would go into the general fund. It's just an assumption that we have in there. We can talk more about that on March 11th, when management partners is here to go through the long range forecast and that we can get into what that looks in terms of an ongoing assumption. Next slide, please. So, and again, just briefly. What we wanted to do was illustrate some of the, some of the things that pop up that, that. Effect on reserves. In a given year. And, and like I said before, our given years are turning to be more. You know, regular, unfortunately, but. We knew that we were going to pull down money from reserves. To plug the gap in our structural deficit. But then on top of it, we had. You know, what is that about. 9.2 million dollars that we pulled pulled out of. The reserves for both COVID response and class fire response. So. So anyway, that is, so what it does is it just exacerbates the problem that we have going through. And it makes it. More difficult. To address the next year because the structural deficit still exists. And we're running out of them. The funds that we can use to plug it. And Alan, I apologize to jump in and interrupt. You, you have on this slide. 9.2 million used from the reserves due to the glass wire and COVID. Earlier. It said due to COVID, it was 8.7 million. Was used. Is this, is this a more updated one or was the 8.7? What we think is reimbursable. 8.7 was. Was more of a. Of a total cost. So that's, that is a response that includes existing appropriations. Okay. Impacts to those. This is specifically what we pulled out of. Of reserves. So the 8.7. Was largely allocated and then on top of the 8.7. Was 9.2 or there's overlap between those two figures. The overlap would be 8.7 is the total amount of the impact for COVID. 7.4 of it. We had to pull out of reserves. Thank you. That was allocated. Great. Thank you. All right. Next slide, please. So then this gets us to our, our reserves as, as we are seeing it. From where we began the fiscal year or where we ended last fiscal year. At $23.8 million in reserves or $2 million under our, our policy mandate. We pulled money out. Including the, the 18. The 8.7 that came out. And then you have. Some turn back coming back. And again, that is. The, what we are thinking that might be. What is left of the $5 million of salary savings. There are some funds that we set aside. And in case we. That we didn't need to use because. We extended all the contracts without. Increases. Due to the uncertainty of where we were with COVID. And then we're, we're thinking that as a total amount, and I know we talked about this a little bit on Tuesday, but as a total. General fund revenue. Bolstered by where we think there might be some more. More positive. Revenue coming in on sales tax. Our property tax being strong. That we think that we might right now we're projecting. That we could have $3 million more than what we estimated. So when we do the math on that, we're left with about $5 million in reserve. Again, it's a mid year projecting out to the end of the year. Basically the way that we do that is that we assume the budget or the expenditures are going to equal budget. Unless we can tell for sure that we're going to go over in a certain area. So like I said, the overtime, we know that that's going to go over budget. So we're going to go over budget. So we can kind of figure that in, but for the most part, we, we would do any projections of reserves. On a mid year on a budget basis. So that's what you have there. Next slide, please. So in here, you know, where we've kind of had it as part of an overall. Use. Of PG and E money to stabilize the organization. Here we're, what we're basically saying is that it is, it is very important that we use that. In order to essentially balance our budget. For fiscal year. 21 22. And I think, I think the next side is when Jan will come up with a, and she's going to talk about where we kind of go from there. We have a very. Strong. Philosophy and drive in our finance department. Those aren't the greatest choices of words, but anyway, we, we know that, that whatever we use to plug a gap, it's got to be, you know, one time use. So we have a dire need for money to come in to plug that gap and reserves to allow us to pass our budget. That is it. We need to make changes during the year. That makes it to where we don't have to rely on anything like that. This is supposed to be emergency need. But with that, we're looking at $40 million. That's the aggregate of the 30 million that management partners. Had in September. Plus the around almost $10 million that we've pulled out through the first half of this year. Kind of gets to the 40 million. Obviously, if not all of that is needed, you know, that it kind of, it's still in that, that can go back into the pot for other community needs. But this is what our estimate is at this point. So it's kind of a starting place. And like I said, in March 11 management partners will be back. They'll have a revised. Long range forecast based on mid year amounts. And they may have a different outlook. So. Next slide. And I believe yes. And so with this one here, looking at our strategies. Let's have Jan come in and kind of take us to the end. You know, before I delve into either the short term or medium term strategies, it probably would be helpful for me just to sort of paint a broader perspective. So I think luckily. After I'd been at the city for a week. I really had to take a deep dive into. Financial. Into prior budget performance and come up with an assessment of where just from my view. Where I thought we were. And to provide a little bit broader perspective on what I'm going to talk about. You know, one of the things that I really heavily rely on is what does historical data look like? Because historical data. Frequently is indicative of future performance and puts information in context. Meaning. What trends are we on? Are they upward downward or fluctuating? And. And so. I mean, I took away my own perspectives of where I thought trends were, were headed. And, you know, even not withstanding COVID. The fires. There were certain emergent trends. That were present. If you go, if you went back. And said, look, looked at five, six years ago and what that. Sort of. What that pretended, if you will. And so even then, you know, there were divergent streams of revenues and expenditures. Expenditures were trending up. Revenues were trending downward. And so it probably would be helpful to talk about financial condition a little bit. And financial condition in, whether it be Santa Rosa or other governments in California and frankly, in other places around the world. Is impacted by a number of factors. It's impacted by. Environmental. Fiscal. Organizational. Policies decisions and actions. And the results of all of those show up in a variety of ways. Whether it be both budget balance and challenges, service levels, susceptibility to other socioeconomic forces, adjustments to those forces, as well as demographic changes. And business cycle impacts. And I think you can see. Examples of all of those. In the city. And while we may address each of those issues. Very differently. And individually, they really all converge. Financially. And I think, as I said, we see those evidence, those evident forces already at play in Santa Rosa. But with that in mind. I think it will be important to strengthen. You know, budgetary fiscal and financial practices. With the intent that those practices enable the ability to for stronger execution of priorities. Across city departments. I think what that means is it means. You know, rebuilding reserves, balancing, recurring expenditures from recurring revenues. Rather than one-time revenues. Providing. Timely information, meaning the finance department. To be used for decision making. Meaning that we have, we're afforded the opportunity to make some. Express decisions. Meaning. Are we going to stay the course? Or do we need to take corrective action? And I think the mid-year. Going forward is what we should see what we should do. At this point in time. Next year. And so with that, you know, I, you know, we're not going to turn this around overnight. It's going to take a little bit of time. It's going to take a little bit of effort, but I do think there are some short-term. And immediate strategy. And I think we should see what we should do. But I do think there are some short-term. And immediate strategies that we should think about. Whether it's repatriating revenues. A commitment to how we balance expenditures. I think the cost structure. That we currently have is really unaffordable. And untenable over the longer term. I think as we think about how we use the other PG&E monies. You know, I. I think we should see. Criteria require criteria and quantitative supporting analysis. That matches with the project. So whether it be we consider, whether it is we're considering one of two choices. Or alternative choices. That's one set of analysis. If we're thinking, for instance, of the fire station, we should think about the operating side of the business. And we should think. Somewhere in the prioritization, how those funds get used. You know, I think should be based on highest and best use. And then. I think on the operating side of the business. I think we need to, you know. Think about what corrective measures look like, whether it be, do we need to reestablish a budget baseline? And, you know, sort of know with certainty. So that we can make some short-handed, some shorthand decisions. Revenue stress testing under certain scenarios, whether it be 5%, 10% or some other percentage. You know, what does revenue performance. You know, look like under different scenarios. One of the things I think you should expect. And I would. I'm committed to doing that. And I think one of the things that I think is, is that we have, you know, periodic financial assessment that is aligned with the health and the needs of the city. You know, I've also spent some time speaking with management partners and talking about their views on some of these issues. And realizing that in the state of California. And I think the only sustainability we get on that end relates to, you know, assessment of our own tax and fee policies as they're more likely to be sustainable than anything else. I think we do other things that, you know, augment how we make decisions about spending. Constant examination, obviously of a spending plans. You know, looking at. Fleet capital replacement. How we replace, you know, other assets, how we keep our assets, you know, in good repair. You know, and how we root nice other work are their technologies. For instance, we ought to be taking advantage of post COVID. And how do we make those investments on an ongoing basis? You know, I think, you know, this isn't, this isn't a decision to be made today or probably even in goal setting, but just, I think, in terms of thinking about some of the things we should think about one immediately, meaning in the current budget year and then looking forward. Medium term. And I see the city manager and with that, I'll turn it over to him. I think this should be refreshing news for the three of you. I think this is the sort of work that you've been looking to do in this committee. I think it's going to change significantly what we're bringing to you. So you're hearing that there's going to be a more regularized report out on the fiscal condition. What we're going to need assistance with with your colleagues is understanding that we need to address that structural issue. And that structural issue is going to be difficult because there are, and there are revenue ways to address it, but going back to some of the conversations we've talked about before about policy driven decision making that sets criteria that looks at the health of our revenues and looks at the condition and the needs around of our expenditures. So I think, I think to me, this is exactly where we need to go. I think it's the message that I've heard repeatedly from this group, which hasn't changed substantially over the period of time. Most of you have participated over the last few years. And I'm really excited about Jan bringing that kind of discipline to us and us figuring out how we bring that discipline to the entire organization and into your colleagues on the council, because it is going to be a significant change. We've gotten in a habit that was also continued by the needing to shore us up during emergencies of not thinking in those terms. And we really have to start thinking in those terms for the longterm health and actually being able to write the ship so that we can do additional work in the community. So I think it's, to me, it's really refreshing. It's going to be changed. It's going to change the dynamic in this room. And I know staff is excited about it. It's probably going to be change in our basic processes around how we build a budget moving forward. So I'm excited to get started. I think this was a preview of that. You're going to get some more work. And I'm hoping that work matches up that we don't have any more emergencies between now and the beginning of the budget cycle. So we can synchronize the conversation with this group with the larger budget questions, right? So that, so that, that really the work we're doing supports that. And you can help us make sure that the community and the, the council understands this work that, that's taking place in this committee. And we're, we're open for questions. I don't think there's, Jan, is that the conclusion of the presentation? Yes, it is. I appreciate your comments, Mr. City manager. And to your point that you were making that is why I kept this committee the same. From last year going forward is, I do know from having conversations with both of the other council members that we all do have a very similar philosophy on, on writing the ship. And in fact, that's a lot of my, my notes and questions that we'll get to Jan. If you don't mind. I did want to, I see council member Sawyer has unmuted. And so I'll go to him first. And then I'll come to council members wet helm. And then I've got a couple of additional questions. Thank you, mayor. And it's what I hope is a fairly simple question. I am excited about the changes in, in how we, how we function, not only as a, as a subcommittee, but, but as a, but as, as a council as well, it will, it will force us to behave differently. What I hear you saying in this tense, and please correct me if I'm wrong, that we will actually be able to use some form of litmus test when making expenditure decisions. I think that. It will help prioritize. I think that more rigorous analyses will help in the prioritization of decisions. You know, use of finite resources, and, and I think that's a really important thing. And I think that's what we need to make sure that all of the. Cash and budget are. And I think that really is the goal, you know, what can we get done? Is it affordable? Is it doable? But I think the inf, I think the sort of analysis that one gets should be helpful. In framing of the decision. and we'll come up with a budget. And then as the year progresses, things come up. And unless there are emergency things, sometimes I think there's a tendency for council to spend money that it doesn't have and or that it wasn't planning on spending in the first place. And being how to keep that reality in front of the council throughout the year is challenging because the community comes forward and what sounds like relatively small amounts of money that were unexpected and unbudgeted when they come up throughout the year, it can add up quickly. And so what concerns me sometimes is that we end up spending fairly reasonably large sums of money that once added up throughout the year that we had not really planned on spending. And being able to keep that reality of fiscal being fiscally responsible in front of the council on a fairly regular basis, well, I think it will help with that. And it's kind of a constant reminder that this action that you're about to take is going to cost X number of dollars potentially. And that is going to compromise your ability to do other certain things that you actually budgeted for and now you're changing your mind in the middle of the game. It's those kinds of expenditures that tend to concern me throughout the year after our budget exercise. I can certainly appreciate that. And I, you know, look, the reality is there are certain things that are going to come up but there are things that come up that probably really shouldn't come up. You know, if we all gave what you wanted the budget process to be is a well thought out business plan for the departments for each year. But that planning has to take place in front of the budget process. And the budget really should reflect, you know what that work plan is for the year. I think if that is done, that will help that won't solve everything but I think it will be helpful. And I don't know that budgets frequently get put together with that sort of precision that one might like them to have but I think that's part of the answer but I think part of the other answer is, you know when people come to the council, I mean I think it should be framed they should be able to frame, hey, what are my alternative funding sources? Have you sort of worked this out in the departments with the city manager, with the CFO or the budget manager, you know, whomever? And you know, it shouldn't sort of be here's what we're gonna do and it sort of puts people on the spot of having now to go back and sort of sort through that. So I think, I mean it's probably not a straightforward answer. I think it's a combination of things but I also think it's sort of practice that, you know, certainly habits we need to do a little bit differently and I would, you know, venture that it's probably all of the above but I mean, I'm really a big believer that, you know, whatever the spending priorities of the city council is for the year and the budgets really ought to reflect that and a plan for execution and then, you know, at the end of the fiscal year we ought to be talking about, hey did we accomplish what we set out to accomplish? Why didn't we? And, you know, have that discussion and you know, it can't always be about something else came up if you've given a lot of thought a forefront. So those are my thoughts on it. Thank you, I appreciate that. Council Member Svetham. Thank you, Mr. Mayor. Thank you, Jan, for this presentation for your comments, Mr. City Manager and Shawnee did hit the nail in the head. This is music to my ears, what I'm looking for. And the one challenge to go along with what Mr. Sawyer just brought up sometimes we're our own worst enemy. And when I'm saying we it's the seven of us sitting on council because I can count probably the last three council meetings we approved over a half million bucks worth of things that didn't fit in any budget. And there's always that little line that I know the city manager and staff puts in there this is coming from the general fund reserve. And I'm just wondering if they're, you know Mr. City Manager, if we could highlight that put some flashing stars on it is that we did not talk about this and there's a consequence for that. Cause I know I frequently said to the Mr. City Manager if we being council asked you to do something that isn't on that priority list it's gotta have an impact, Jan. And that's what I heard you talking about it's an impact to the budget or the workload priority of our staff. And I think sometimes council, especially live we act like whether or not it's funny money but here's a compelling reason to get it but if we take these individually versus what you're talking about the budget process as a whole we need to have our systems down pat and recognize that if we change this process you know, we'll see what goes on in the 18th to 19th that should really be our roadmap moving into the future. And I do appreciate and I really don't have any other questions I'm just affirming that I like this process and I am interested in getting more feedback or more meetings of this group. And then the three of us can report out at council we've got this process we need to be on the same page because if we start, you know if four of us decide to go one direction I get the position the city managers in I can count to four out of seven means we're going in that direction and we have to I think recognize and honor the process that we've all agreed to during these financially challenging times. So sorry, Chris, no questions just kind of editorializing. No, no, that's totally fine. I do have some questions, Jan and Alan because I know Alan you've been doing a lot of the pre-work on this and to council member Swett Helms point I did want to verify the 1.2 million that we're expecting for Cahoots that's not allocated anywhere in the budget, correct? That that would come out of the reserves or it would come out of the next year's budget we'd have to find that 1.2 million. So as I think this is what Jan's so what we need to have as a process where we do the analysis, right? I think sometimes we get into a question about where the funding located and we haven't gone back and done the business analysis that we need to do to set the framework. So we get caught up in where is that coming from as opposed to getting the direction and having a process that allows us to address it. So we may come, we may come I understand. Yeah, but it's not, but right now I would say there are, that's what we're doing is we're trying to do the business analysis on the program so that we can understand where it fits because there may be the public just one we know there are public members who just say either make it come from the police budget or don't add to the police budget. We got to do the business analysis on the product so that we can assign it to a place in the budget. So I'm gonna say it could come from right now traditionally what we've done is exactly what you said go to reserves, move it from reserves. We're talking about a business planning process that may come back with a different answer than the one you've just asked. Yeah, and I can appreciate that. My question is until we have this process in place is it gonna continue to operate the way that it has in the short term? Alter change takes time. So we're talking about business modeling. So that's why we got to use some of this to make some of the changes now but it is going to be an ongoing process to make change. Okay. Go ahead, Alan. Well, just to kind of on the where the money is we did when we brought police down to baseline we did put that aside. So that's about 900,000 of whatever. And so that is something that wouldn't need to be pulled directly out of reserves that would be there for. Again, Alan slipping back into the old model what I think we need to do is have here's where we wanna go as an organization how do we structure our business to meet the need? And so that's why it's a longer event horizon to do budget processes as Jan said it takes more time because you have to start building that work upfront. Our traditional answer is we set this money aside we've gone here, we've gone here and it starts to get us into fiscal issues long term. If the challenge is how do we integrate this service? And again, I think this is why questions about what calls for service come from what are we driving? What costs we're doing? I will tell you this is also the exact conversation I had with the team on homelessness right now about the study session. We're gonna have to change how we look at data and how we look at business planning to address these issues which I think will help some folks but that doesn't happen overnight because we've got a system that I'm sure the former chief can tell you doesn't necessarily work that way. It may work in some departments that way but this is an organizational change and that's why we're saying we're gonna need your help to reinforce that organizational change because we're so locked into that pattern of exactly that question, Mayor. Okay, I appreciate that. So looking at current budget and Jan will get to future, looking at current budget, I am breaking it up into two different categories and I appreciated the way that you talked about this. One is the ongoing sustainability of your operational budget dollars in dollars out and then the other is how to utilize your one time dollars as well as your reserves needing to maintain and build back up your reserves. So there is potential for the federal dollars. How does that calculus change the request from finance of the 40 million from the PG&E settlement funds? So the city manager is gonna say not at all because we don't know the details of the federal requirement. We have to know what the details on the federal requirement are. Then we can bring that question back to this group about where the change should be. But right now we don't know what the requirements are and what the agencies are gonna require. There are questions about whether it can even be spent on things such as investments in communities. Those are real questions, right? So we all know the federal, the devil's in the details with the federal government. I'm hoping to get some more certainty on that front going into goal setting, but until we know it we're gonna have to say money's coming but what are the restrictions and then we're gonna have to come back and have that conversation. It is speculative. And I'm glad that that's the answer that you gave because what I'm worried is going to happen is as we start to see in the press 35 million, 34 million whatever it's gonna be coming to Santa Rosa I don't wanna commit the false expectation to the public that what we've said is that the 40 million from PG&E is now back on the table. And you all know what's gonna happen is even if that's ends up being the number it's gonna have to go to treasury and then treasury is gonna have to determine how quickly it goes out the door. No matter what the 60 day turnaround is what the reality is is gonna be very different than what the directive is, right? And so even in the timing it's gonna be a question what even once we know the rules there's gonna be some real questions about timing. Okay, and then Alan I asked you the other night and I do think it's something that I'd like to discuss here at some point and Mr. City Manager of what is the expected return for reimbursements for all of the different disasters that we've front-loaded and I understanding we're talking about a five, 10 year horizon for some of that reimbursement to come back to the city. I'm sure John thought in 2008 man 10 years from now it's gonna be so much easier for people to budget and I'm sure thinking about how much we've expended and knowing some of that will come back and go appropriately back into the reserves I think is gonna be a conversation that I'm interested in having. Again, divorced from the conversation about your ongoing budget, your ongoing revenues that's coming back to us as a one-time fund that can go into our reserves and help build that. So I'm interested to see what that number might look like. And I think we're gonna start to get it. That's one of the assignments that I've asked Jan and Alan and Jason to take a closer look at. We'll make a pass at that on the 23rd I think there's an update coming. But again, one of our education points is gonna be that the timing on that is incredibly speculative. Right, right. That the timing is, that's where the unknown lies in all of these questions. Yeah, I don't see that as something that today we'd use to project out any types of changes in our one-time funding. To me, that's one of the wildcards to John's point mid-year adjustments that could come in that we'd be discussing at the point that those dollars come in kind of a thing not necessarily to be spent, but in anticipation as they come in surprise dollars which are always a good thing. Yes. Yeah. Jan, my understanding is that property taxes typically lag about two years behind sales tax when there's a shift in the economics that in recessions usually they're about two years behind. I heard Alan say that we actually think we might be 3 million ahead going in this year from what we actually budgeted or expected. Should we also start to prepare to see that dip in the next couple of years or is the COVID crisis so far what you're seeing from other jurisdictions not impacting property values? Do you want me to take that one, Jan? We're not seeing it impacting other jurisdictions right now. A lot of the things that happened in the last recession so far aren't turning up. However, there is concern over, depending on what relief comes for people to help with mortgages, obviously that's gonna be a thing that you're gonna wanna look at and all that to try to project out into the future. But right now what we're seeing is that for the most part, property values are staying high. Building activity outside of COVID when they're allowed to do it, it seems to be going well. People are doing work around the house. Interest rates are low, so I think they are taking advantage of that. So for the near term, we're not seeing it, but obviously we are always looking. I think one of the forums that we went to, the Sonoma County ones is that you always keep an eye on building permits and when you see those things starting to trend downward, that's when you start getting worried because now you're seeing a stall. We just haven't quite seen that where I would be really concerned right now. Okay, great. And then my last question is about pensions and on two fronts, one is for this year's budget, what I know each year sort of we see an additional obligation on the city to increase costs. What are we projecting the increase is coming into this next year? And Jan, you coming in and taking a look, I'm sure, what can you give us your thoughts on sort of long-term how we meet that sustainability point and understanding that it's broader than just us, that it's the whole system, it's sort of where we sit in terms of, do we know what percentage of funded our pension obligations are now? Alan, I don't know that I know that with any exactness. Yeah. And Chris, I'm gonna, oh, sorry, Jan, I didn't mean to step over, but I didn't need to get back to on that. So in the March meeting, we'll have that information. I just don't have it off the top of my head. I know that we have the valuations are there. I don't have it right in front of me right now and I wouldn't wanna have you to guess. Yeah, if you could, that'd be great. I have it in my head from a couple of years ago when we pre some of these fires and pre the pandemic, I know we had a 10 year horizon to finding some leveling off of the pension obligations for the city. And I'm wondering just sort of how potential recession or drop in economics could impact it, though I do also recognize the stock market's doing fine, which is where a lot of that return comes from for the city. What we'll do is we'll get some sort of an explainer. Oh, you know what? If you promote Shelly Riley, she could answer that question. I'm sure Shelly is thrilled. She's thrilled me to the rescue line. Given that she just saved you, what are you gonna promote her to? I don't know. I don't know. So purse rates are doing a couple of things. The normal retirement rates we saw actually go down for miscellaneous police and fire. Unfortunately for us, the unfunded liability payments are still going up. For miscellaneous, they went up about 11%. For fire, they went up 10%. Police, they went up 16 and a half. So next year we're looking at, and this is citywide, I'm not being exclusive to the general fund. So we're looking at about $29 million. Last year we paid about 25. So it's significant increase. And I don't see those UALs, I don't know off the top of my head because like Alan, I don't have that purse rate in front of me, but those will continue to increase at least for a couple more years before we actually start seeing any sort of significant dip in them. Okay. I really appreciate it, Shelly. It's one of the things that I'm trying to just keep an eye on as well when we talk about long-term sustainability is that crowds out our ability to provide more service, right? And so how do we keep an eye on that or keep control of that to the extent that we can and how do we meet that sustainability point? When we talk about, Jan, when we talk about long-term sustainability, I'm talking about all of those components. And I'm sure from what I'm getting from you is that you are too. I am. And I don't think I've said this out loud, but one of the things that in fact, I think we're having Alan and I are gonna participate on a call tomorrow is whether or not, I think now you can sort of take out discreet maturities with CalPERS. I haven't spent a lot of time talking about it or looking at it, but our call tomorrow does relate to that and whether or not we'd be better off sort of, I don't know how we'd make the trade on monies, but whether there's any value to some of the monies being taken out that expensive, because the CalPERS amortization is very expensive, actually, relatively speaking to other things. And so it's one of the things we'll look at. I can't answer that right now, but we'll circle back on it whether or not it makes sense. Yeah. Yeah, that's great. And one of the things that I have in my head, and I apologize, I didn't prepare to talk too much about this, so I might get some of this wrong, but I do remember that this group did a year or two ago, had an opportunity with some leftover pension obligation bond dollars to pay down some one time to get rid of some of the amortized o-ings. Is that how you put it? I'm not quite sure how to phrase it. That was one thing that we were very supportive of was one time investment in dollars to then long term, oh, a little bit less year over year. So I know it's something that we would be supportive of. That's all I've got. So I appreciate that. Any other comments or questions, John or Tom? Any final comments, Mr. City Manager? All right, Jan. Well, I really appreciate you coming on here. I'm looking forward to getting to work with you a little bit. I'm pretty excited by this. Thank you. Thanks, Jan. Thanks, Allen. Thanks, Chief. So we'll go on. I guess I should also see if there's any public comments. I was gonna say wait. I sometimes forget we provide enough commentary, but other people like to be engaged as well. I'm seeing no hands. So I'll move on to item number five. And that's the next meeting agenda items. Now, Mr. City Manager, did you have ideas for the next items or did you wanna hear from us what we would like? I think we're gonna program it. And I think that's, we have a presentation from management partners, correct? That's the big item. So that's where we would like to spend the focus of the period of the time. That works for me. Anything, John or Tom? Just for me coming up on our goal setting to actually implement, you know, and if this slide number 10, some of these different strategies get shared with our colleagues. And I'm not sure how much of this information will be shared during the 18th and 19th, but this looks great on paper, but when we actually start talking about projects and costs and the reality of making some of these decisions, those are the conversations I'm looking forward to. And I think we'll get to that in the budget process. I would be pleased to bring the slide somewhere in the deck and you all could talk about the work that you're planning to do with us on that front. I think that would be good and we'll bring the slide along. You know, priority setting is priority setting, but I do wanna make sure that they understand that we're gonna begin this work this year in the budget process. So we'll figure out how to integrate it into the presentation. We won't probably spend hours on it, but we will make sure it's there, okay? I'm just a big believer, as you mentioned several times, it's a culture shift and we can only move at the speed at which the shift can change and we can absorb that change. So even just planting seeds and then continuing to reinforce that, I think will lead us to success. And it will afford me an opportunity to introduce Jan to the rest of the council at that time too. So we'll make sure that's included. Great, thank you. And just really fast too on the goal setting, we did create space as we talked about on Tuesday for us to talk about utilization of the PG&E funds on a couple of the items that the council seems ready to move forward on. Alan and Sean, are these, is this request for the 40 million for the reserves? Did you get the direction you need from council on Tuesday or do we need to discuss it? I think we need to discuss it just to make sure we're all on the same page because I think everyone was, I'll just say by the time we got there, there was probably a little weariness in the room. And so I would request that we confirm that that's the way we go ahead. So there's no confusion moving forward. I just understanding after sitting through five hours of a very, very important but challenging conversation. I think it'll be good to repeat. Well, we'll make sure that we drill down on that point. I did talk with the facilitator today and told him that I thought that we needed more than a half hour for the discussion about the PG&E funds. Yes, he said, yep, absolutely. Just to follow up on that, on the paying down first thing we did, pay down, I forget the exact amount, I think it was around three million or so that was left over from an urgent obligation bond. We did do a payment on that, it lowered our UAL about $700,000. So. Great, thank you, Alan. John. Thanks, Mayor. I'm hoping that in both our priority setting and our budget setting, that we do not hold back the finance department from cautioning the council strenuously and very, very clearly and realistically about our realities. In my 14 years on the council, I've never seen a $5 million reserve number. I used to think it was scary when we got, anywhere in the teens and being where we are now, it gives me no small amount of anxiety and to our new council members who are not used to, it's all new to them. And we need to very quickly educate them on our fiscal reality. And so my recommendation is don't hold back. And you can stay just this side of scaring everyone, but maybe a little fright would do us all a little good. You know, I'm never shy about frightening, but it would be helpful to have some support network for us in that conversation. That's why I'm asking what I asked of the members of the subcommittee. Absolutely. John, the phrase that I heard earlier today is that the Christmas tree can't hold any more ornaments. That's good. I think the Christmas tree is looking a little good. Should we provide the visual? Should we provide the visual? Do you want a big tree with lots of ornaments or the Charlie Brown tree? Charlie Brown tree, that's what I was gonna say. Without getting in front of any trademark issues, which they're very spinuous about. Well, I'm certainly glad we can end this meeting with some laughs because the rest of it wasn't too funny. No. True. All right, thanks, everybody. We'll go ahead and adjourn then and we'll see you in goal setting. Thank you. Thank you all.