 Good afternoon, everybody. I'm going to call this meeting the January 25th 2024 special meeting of the long-term financial policy and audit subcommittee to order at 401 p.m. Madam host, may we have a roll call vote. Chair Rogers. Members staff. Here. Member McDonald. Here. Let the order reflect that the subcommittee members are present with the exception of chair Rogers. Thank you. I was my cure. I'm clear. Sorry about that. Will you please explain how public comments will be heard to today's meeting and then we're going to go to public comments. Thank you. Welcome subcommittee members, panel members and members of the public. Thank you for joining us today in person and via zoom. This meeting is being reported. As a reminder to all present, please set your cell phones so as not to disturb others. The city of Santa Rosa is committed to providing a safe and inclusive environment free from disruption and will not tolerate hateful speech or actions. Everyone is expected to participate respectfully or necessary. The meeting will end immediately after an agenda item has been presented. The chair will ask the subcommittee members for their comments or questions and then immediately following their discussion. The chair will open the item for public comment. If you are attending in person and wish to comment, you will be called on when the agenda item is open for public comment. Please raise your hand to indicate that you would like to comment. And once you've been called upon, you will be asked if you wish to state your name for the record. The public comment is limited to three minutes and a courtesy timer will appear on the screen. Our meeting format is integrated to allow members of the public who are using zoom to view and listen to the meeting. Any email comments that were received by the deadline will have been included and uploaded to the agenda prior to the start of today's meeting, but emails are not read into the record. Thank you. So we are now taking in person public comments on item two, which is not agenda items. This is a time when any person may address the subcommittee on matter is not listed in this agenda, but are within the subject matter of the jurisdiction. Madam host, do we have any public comments? I see no hands raised at this time. Thank you so much. We'll go ahead and move on to item three approval of the minutes. Are there any corrections to the minutes. If there's no edits or corrections and minutes of the November 9, 2023 will be approved as submitted. We'll now move on to item 4.1 federal year 2024 quarterly budget review second quarter. Looks like Veronica is going to be presenting for us. Good afternoon. Yeah, today we will be going through the second quarter update for the general fund. As we do quarterly and we will be taking a look first at general fund revenues followed by expenditures before we take a look at our next steps and answer any questions for the upcoming budget season. So our first slide is a picture of our pie chart one more please. This is a snapshot of our revenues that we've adopted for the fiscal year 2324. We adopted a revenue budget of 204.8 million and recurring revenues. And our two biggest pieces of this pie chart are property tax and sales tax. Those are the largest indicators of the health of the general fund that fund most of our operations. And as a reminder this year we did pass a deficit budget. So even with hitting our targets on revenue we are still facing a potential deficit at the end of the year. We're going to look at the major revenue categories and see where we are as of December 31st. All the way down at the bottom line where it says total operating revenues you'll see we're at 42.4%. It might be reasonable to think we'd be at 50%, but this isn't the case because there's some timing differences with some of these categories. Overall 42.4% is is reasonable for us. Starting at the top I'll take you down through some of the major categories. Property taxes we are at 56.8% which is just slightly ahead. We normally are at 55% this time of year we receive a 45% payment in the spring and 55% in December. So that one's looking good in part to some of our smaller property tax categories such as supplemental property tax these are a little more volatile and running high this year. Sales tax is received on a two month lag. This is our largest revenue source in the general fund and we wouldn't expect it to be at 50% but we do expect it to be more at about 33 or 34%. We're trending low on this one this year we've been hearing there's going to be an economic slowdown and we're definitely seeing it. If we were to continue on this trend by the end of the year we would be coming up at $5 million short in sales tax. That may not happen because this number does not yet include November and December which we know are typical high spending months of the year. And we may regain some ground in the second half of the year consumer confidence is high the economy is doing well we're hoping it won't be quite that bad. But even if sales tax does come in low we're seeing that we're making it up in some other categories so overall the general fund is doing okay. Utility users tax is another one that is also received on a lag and this one's coming in ahead of schedule. We've seen some big spikes in the utility users tax assessed on PG&E and energy costs. And we've been trying to increase our budget to make up for this increase but the revenue still is coming in high so this one's trending a bit high. Other taxes is made up of some pretty significant categories we're going to save that for the next slide that will go over those. Licenses and permits is just about at 50% and these are a lot of our PED revenues so those are right on track. In charges for services we're trending a little ahead as well that's all of our recreation revenues which can be slightly seasonal we see a lot in the July, August, September months as well as our PED revenues there. And then the remaining categories down there are kind of our smaller categories. Things to note fines and forfeitures is running a little low that's our parking violations revenue mostly we've been offering a lot of free parking around the city so that one's coming in lower than expected. And transfers well it looks like it's ahead that one will come in at 100% at the end of the year we can control our transfers. So our final slide oh no I'm sorry we're on other taxes. So as I mentioned on the previous slide this is kind of a deep dive of that one category of other taxes which includes some significant categories. And going down this list, the VLF swap is slightly ahead, we received two equal payments of this one throughout the year so we're going to exceed budget by about a million dollars at the end of the year. And can you just what is VLF stands for vehicle license fees. Yeah, and that one we get kind of in line with our property taxes, our franchise fees is this one comes in substantially in April so this is just a timing thing it's really low it's just we don't see the rest of it till the end of the fiscal year, and motor vehicle license fees same thing that one comes in in March. Our cannabis industry tax, we've seen this one in the recent years kind of stabilized at around 2 million. So we have a budget of 1.8 and it looks like we may exceed that this year. We have exceeded 2 million in past years but then it kind of dips down so it, not necessarily indicative of a trend of it growing but we'll watch that one. Our real property transfer tax has been low. Every year we are reducing our budget and then our revenues keep coming in lower than we've reduced we're kind of trying to find where the equilibrium is on that one. Again this is just a product of the housing market interest rates are high, although our home prices the valuation is high the number of transactions are low so that's this is based on volume of home sales. And then our occupancy tax is coming in a bit high as well we've seen a spike in that one in the recent year due to short term rental tax revenue as well as just the tourism recovering since COVID. And then our final revenue slide is going to give you a comparison of where we were this time last year to where we are this year. Property taxes is growing quite well at 7.6% but again some of that is our smaller more volatile categories that are coming in high. Sales taxes is low, we are lower than where we were last year which is concerning because for so long we've been seeing sales tax grow very steadily year over year. Again we'll have to see more at the third quarter and just see what happens in the second half of the fiscal year. Utility users tax is right about on trend. Other taxes is high. This is primarily due to business tax which we did have a one time audit occur in the fall so there was kind of a timing thing of one time payments came in sooner than expected in the current year than we had seen in the previous year so that's not necessarily a growth trend but just the result of one time payments coming in this year. As well as vehicle license fees have been growing. And other significant trends are smaller categories we do see volatile shift so there's nothing really noteworthy there. And charges for services is coming in slightly lower but just about on track. So that concludes the revenue discussion. Again overall revenues look like the general fund maybe just fine by the end of the year we're tracking with budget but that's really only one half of the piece of the puzzle here we have to see where expenditures go as well because we do have a deficit deficit that we're aware maybe coming our way. So our next slide shows a second quarter expenditures of where we are as of December 31 by department. So we've excluded non operating expenditures such as projects which are not really a reliable source here for showing our spending. If you look at the far column on the right percent of budget I would expect us to see anywhere between 40 and 60% spending. There's timing issues with invoices and contracts but that's what I would consider to be expected. I'll take you through some of the anomalies that we see here. City Council is just slightly ahead. This is due to the interim city attorney contract being paid from City Council's budget. We're going to adjust that at your end so you aren't necessarily over budget. That's just a one time thing this year. And City Manager had some vacancies in the first half of the year that are now fully staffed so their staffing costs were very low. Communications and intergovernmental relations they're only at 37% but that's also due to vacancies. They're a department of nine people so when you have a couple people vacant it makes a very big difference in their spending. And the other very low one is housing and community services and this is just the timing thing. This is their contract for legal aid that we will pay 100% of that by the end of the fiscal year. Our next slide shows a comparison of department spending where we were last year compared to where we are this year. I would expect to see anywhere from like a three to 10% increase year to year to account for increases in operational costs and staffing costs. We moved over the place on these. A lot of this is due to reorgs that we've had we moved the parks department from TPW into recreation we moved community engagement from recreation to communications and intergovernmental relations. There's been a lot of shifts. So, again City Council looks high but this is also due to that contract that we've been paying out of there that will be adjusted and city attorney looks low. This is due to vacancies. So there are some some fluctuations in here that can all be explained. But overall if you look at the bottom line at the total of 8.1% growth. That's right in line with what we would expect. And then our final slide for expenditures is looking at salaries and benefits salaries and benefits are about 73% of our general fund expenditures. So compared to what we spend that's also our most timely so it's a very good indicator to see where we're going to land at your end with spending. So compared to budget at December 31 we have spent 50% of salaries and 48% of benefits, which puts us at 49.3% which is right, right there. But this is actually a departure from previous years of what we've been used to seeing we've had some pretty significant vacancies in previous years. So seeing 50% and 48% is high with dollar figures this big one percentage point can make up a million dollars upwards. So while we're not over budget on these, what we are seeing is that there's not quite as much turn back anticipated at the end of the year turn back is what we call unspent appropriations. And that's usually the primary source of any surplus at the end of the year of these unspent salaries appropriations. There's also a push at the end of the year departments will see if they have salary savings to get city manager approval to use that for some one time funding needs put into projects if possible. So we anticipate whatever salary savings there maybe we sometimes end up spending on other things if we can at the very end of the year. So what this means is that with salaries running this close and revenues running as close as they are that deficit is looking very likely. We may be able to close the gap on it a bit but at this point at the second quarter it doesn't look like we're going to close it completely. And we're certainly not seeing evidence of a surplus starting to come through. I think that was everything I had to say for salaries and benefits just that in recent years we've usually seen the turn back in salaries and benefits of being three to five million so to see us running this close is a change. It's evident of the staffing that we've seen in police police department has been making a big effort to fully staff if not overstaff with people coming up through the Academy and coming retirement so it's good we're glad to have the staffing in and not be facing as many vacancy issues as we've had but it also means we're spending more than we used to in previous years. So that concludes looking at the expenditures coming up in the next few months as we enter our budget season putting together the budget for the next fiscal year. We're going to continue to refine our revenue estimates make sure that we're capturing every bit of revenue that we have coming our way because in the budget, our revenue allows us to budget accordingly for the resources that we need and the expenditures that we need. Starting January 29 through the end of February that's when departments put together their budgets and we begin our analysis. And we'll be back in April of 2024 with the third quarter update and we'll be able to see more of what the general fund is doing. And then finally in May on May 7 and eighth we will be giving you the study session of an in depth look at the budget general fund and all other funds as well. Before I open it up for questions that you want to add anything. Yeah, go ahead. So, actually, Veronica hit a lot of the points that that I wanted to make so I'm not going to be labor those. Well, maybe a little bit. It is me. I tend to be labor a bit. Where we are right now where we are developing our long range forecast. Right now it's in line with how it was. When we last presented it to you. So, at that point we, we were looking at about a $6 million deficit for 2425. Our preliminary look still has us right around that, maybe a little bit less but again as we start refining the revenues that come in refining the expenditures that are going into it. We are looking at a deficit for that year and it will continue to grow going out without labor costs in it. That's just kind of where we are right now. So, we are looking at the ARPA programs, at least the homeless programs that were funded by ARPA. We expect those to be back in the general fund because they were originally in the general fund. We are not making assumptions that any other of the ARPA programs will go back to or will go into the general fund. But there is a good chance that they would. They're very, we have some very popular programs that were funded through ARPA. Safe parking being one of them in response being another. We are actively looking for non general fund sources and some of them exist. But if we were to continue those programs, they would most likely at least in part but probably in whole come from the general fund, which only adds to that deficit going. And of course, you know that we have we're embarking on our labor negotiations and that will also have an impact. We are in just from an economic standpoint. We had Jerry Nicholsburg do a presentation this morning at Economic Development Board. And our economy in whole nationally at California and even in Sonoma County is doing well. We're in one of those areas where yes, we are seeing sales tax receipts start to taper a bit. We knew that they were going to flatten off. Maybe a little bit more than flattening off. It's something that we're looking at. We're not prepared to, you know, until we get into April, that's that's probably when we're, you know, going to make a call on what we do with our assumptions. Right now where we're seeing our staying flat is is fine. As Veronica said, we have other revenue sources that tend to make up dips, but the biggest point that we want to make is that we adopted a budget, essentially in a deficit. Yes, we plug that gap with reserves, but that just means that what you're seeing right there is we are trending to a deficit situation at the end. Can we make up $3.3 million. I would probably think that we could, you know, past years shows that usually we can. But the as we as that thing grows deeper, it becomes harder for us and we could be looking at a spot in a couple years. Where we are not only adopting a budget in a deficit, but then ending the year in a deficit. So that's that is, as we go through our analysis even more refine our projections. Council will no more this body will no more. And we'll present that. So these are the preliminary things that we're seeing now. And so, just the, the neon heads up that these are out there. Hence my dower look this morning. With that, my comments. Right. We'll go ahead and go to questions from members of the committee. Vice chair. We have a couple here. Well, first of all, it seems like your recent track record of very, very tight budgeting continues. Seems like you're within a percent percentage and a half last year. We were within. We're kind of trending in that same direction this year. I think we're going to have a decline this year compared to last year. And if I remember correctly, those numbers are not inflation adjusted. So that sales tax to climb the fact that we have a decline this year, in spite of increasing inflation, like that drop is in real real terms. And that usually what we hear and what we're seeing is that it's a shift from from the purchase of goods that happened more so during the pandemic to services that are non taxable. That's right. So we're we're seeing that people are spending money. They're spending money though on things differently than what they used to. And, you know, the other thing to to understand is that we had really high growth in sales tax during those pandemic years. So as it hits, it's more normal. That's right. Upward trajectory. You know, if you're if you're getting 9% growth, and then I'll send you back down to 3% growth, which is normal. You're going to see that kind of reduction that flattening out. We're just going through that little bit of a correction period, right? And so you're not. You know, it's something that we watch because it is our largest revenue source. Okay. And we are seeing the increases in occupancy tax, which suggests people are traveling more spending money on non taxable goods as they say so it's kind of true we're seeing one go down another go up. One of the points that was made today in the presentation by Dr. Nicholsburg was that there is a there's it's a change in behavior. There's a behavioral change in in almost general generationally. So what we're seeing now is people are saving less and just buying more, but it's really depends on the things that they're buying the stuff that they want to do. They want to go on a trip they're going to go on a trip. They're not saving for something else. The next big question and economics probably is understanding why that is happening as opposed to it didn't happen in the past. Now again, you know, he made some some good points points that we've seen and and that are just now starting where most most economists are seeing the same or they're coming to the same conclusion in that during the great recession, you lost equity, you, you don't retire, right, you keep working because your nest egg left. Well, during this past during the pandemic, we didn't have that happen. You know, equity is is is good in houses now that's rebounded. So people are also 10 years older, and they've left the labor force so there's a lot of contradictions and made sense for them to do that. But, you know, you would look at a shrinking labor force and trying to understand how our unemployment rates are going and how all of that it just doesn't make sense. It's a reset over what we would normally look at. And that's the challenge for most of us going forward is is how do how do you take that reset and then plug it into our forecasting to try to figure out what's going on in the future. Oh, my mind sticking with sales tax for a moment. You mentioned that you would rather have as a percentage of budget for sales tax at this point in the year that rather than seeing it at 31%, we'd rather have it be 33, 34%. And that's, is you're doing that comparison that's without the November December sales tax. That's an apples and apples comparison. That's usually for the four months we have in at this time of year. It's usually at about 33, 34%. Okay, this is this is way down the rabbit hole but like how much do our do our sales tax or how much does our sales tax tend to jump in December. Is that like the highest month of the year? It's, you know, it's not it's not huge is not what you would think that it's this enormous lump sum payment we get in but the thought is okay if throughout 2023 if things kind of backed off maybe the fourth quarter is when things are going to heat up again. You know, it's not a significant increase but we do. We actually all let you know we did see our November sales tax payment hit the bank yesterday so it wasn't included in this because we received it in January. And it was still lower than last year's payment just by a little bit not by a lot. So, you know, we're hoping we'll kind of close that gap. But yeah, we do see November and December can be the larger months, but overall, they're not going to be the ones to bankroll us for the whole year. So, that's helpful. And in my understanding the general story correctly that on the revenue side, pretty much tracking the budget, maybe a little lower than we'd like in some instances but within, and shouting distance of budget on the expense side, my senses that we're running a little bit higher than you expect. So, yeah, I think one point that I left out is on our salary and benefits slide and we see us at right at 50%. That means that by by the fourth quarter by the end of the year will still be there, likely within right at 50%, if not maybe a little low I think it was 48 49% total with services and supplies the part that I left out, we expect that to be pretty darn close to 100%, but usually just a bit less it's at about 99%. It's hard to put a number up there at the second quarter and show where we are because a lot of that is paid on a lag and timing differences but we know that departments by the end of the year try to spend every bit of their budget that they have, and they try very hard not to go over. So, we do expect our expenditure side to be right about on track. Okay, all right, excellent. And then just two final comments for me. One, on the humorous side, as part of your scared straight strategy for city council, when you've got the opportunity to highlight numbers like the 60% you know over budget or percentage budget or what is it 79% 75.9% Yeah, from the font size and highlights, right, even if it's just in the box. Yeah, it's not a for real. Just go just go for it though. But then more seriously with the, with the structural deficits that we know that we're running over the next few years, and these one time expenses that we know, or not one time, rather these the programs that we're running that we know come back on to the budget in terms of safe parking, etc. I'm doing my best to keep those in the back of my head. I'd love to have some kind of, it would be helpful to have some kind of chart that just reminds me what's coming what's likely to come back on the budget or what we would probably want to run back on the budget so that we know that we're talking about those funds and we're throwing out the numbers like 20 or 24 million terms of surplus funds that really that's been allocated, because we've got, we've already kind of unofficially earmarked. Most of those funds, not just for salaries and benefits but for these programs that are going to come back on a general fund that would be that would be helpful. Yeah, one of the things that I have, we talked to housing to get a sense of exactly what the annual costs are of not only the homeless that we think we can, we can guess at around four ish million. That's, that's will be hit on the general fund. But once the ARPA funding runs out. It's the safe parking. So we've in any other ancillary program of that is that would need general fund funding so that we could present that I just don't have it today. I'll probably have it by goal setting. So, yeah, because it would be a good reference point. We always speak to it that these are coming in kind of. I mean I can tell you what's what the ARPA program is for like say safe parking or sorry in response is 3.9 million, but I know that that's a multi year number. So those are the things that that we're getting so that we can provide that context. Thank you. That's it for me. Yeah, I agree with with Mark that having the ARPA money of what's going out and then it helps us not only in the context of goal setting but it will help us when we go to lobby. I think that's important to have those in context. I want to go back to the sales talks, which you said is trending low and I'm going to go back during the pandemic. People were not traveling. They were bored at home. I know that's what we're asking for. We're asking for grant money or we're asking for appropriations. So for me, it's like 2 things. This is what we're losing. And this is what we because this is what we have right now. This is what's working. We're not traveling. They were bored at home. I know I spent probably an exorbitant amount of money because I was shopping because we weren't going places. We weren't going to dinner. We weren't going out and traveling. Now that some of that is shifting, it goes back to our conversation that we had a couple months ago on our occupancy tax and ourselves tax here locally because if people are coming to Santa Rosa for that, but our occupancy tax is too low. Even though we might be trending low on our sales tax because our own community isn't, are we capitalizing on other tourism coming into our community? So a couple of things, where are we at on that? And are we ready to move forward with addressing those taxes that we're currently getting? And because that could be how we're offsetting some of this other trend of sales tax going a little bit lower or looking at some of our revenue. Right. So we are, I'm not prepared to give a full debriefing on that right now. I should be able to at goal setting. That's we have done our opinion surveys on that. And we're discussing internally how we move forward and with which measure, but obviously we know that in order to solve the long term problem, revenue has got to be a part of it. It's really both sides of the ledger. So we're doing our best to look at whatever revenue sources we can. And then along that line, when we're looking at what happened during the pandemic, the feds were also appropriating money to families to help offset if you were on unemployment, you were getting money in. There wasn't, there was more money actually coming into communities for them to spend money locally and buy things. People were cooking at home. They're buying more groceries. They were doing other things. So I could see that that's not dropped off and it does feel that with inflation, you're a lot more cautious about what you're buying because sour cream that was 299 is now 699. You know, those are those weird things that you notice at the grocery store. One of the taxes that we talked about more recently during a presentation was the cannabis tax in the city of Santa Rosa, which is like one or 0% I believe it's an extremely low percentage if I remember correctly during that presentation. So from medical, I believe it's 0%. I think our dispensary, I want to say it's 3. It's like the low is low. It's it's we can go up to eight. Right. And we are not near there yet. So when we were talking about that specific program, the concern is around, we're going at a loss on anything around something like that. So could we look at perhaps all of our taxes and look to see something that we maybe did 5 or 6 years ago is not actually appropriate for how much it's costing us to run a program or what's being taxed in the city. And I'm not trying to pick on cannabis, but I just that's the most recent one that I remember it being very, very low. So I think that might be of interest to come back to look at some of those ordinances to look at revenue and see how much of a difference would an additional 2% make in our budget, or if it's only 3% because if we get zero on medical. So that's a 3% we're at $1.8 million. But if we upped it to 6%, that'd be an additional $2 million. Because something I do know about dispensaries is that their clientele will probably continue even if it goes up 3% potentially. I don't know if it'll curb anyone. Anyone's use of marijuana. So the occupancy tax, I had that, I was, it was interesting to hear that you said that STR as well as hotels were at. Do you know the difference in that because I think we have a cap on STR. So I'd be interested in knowing this is what we bring in for STR. And this is the increase that we've seen on hotels because I'd like to know if there's a difference at like if we're seeing more people stay in hotels because we've capped STR. I'd like to have that information potentially brought back to us. And then let's see wrong target on the budget. That's what it looked like to me. When we talked about retirements, I know 1 of the areas that we've overstaffed specifically was around like police and fire to make sure we're fully staffed because of the lag time it takes for them to actually have. And really get staff ready. It's like 14 months or something like that. So we've done a little bit of overage in to be prepared for retirements. Do we have any projections on. How many retirements we're going to have in the departments. And the reason being is when you onboard somebody, you do have a cost savings. Because they don't come in at the same level as somebody who's going out on retirement. So do we know that by the next fiscal year, we're going to retire out. You know, 10 people in each of these departments and we're going to actually be able to project a cost savings on how many staff members that we have in each of the departments. So. We, we need to talk to the departments to, to, I know that they have those communications. Right for. You know, those that decide to announce that they are going to retire. I don't believe they are required to say, hey, I'm going to retire this year. You usually have those, those conversations. So we'll have to do a little bit more, more work on that to kind of get is if we can put some numbers to that. But you're, you're right, we, we typically every year see a group go out and then we start filling those ranks back up usually from within, and then, and then add to lower levels. And then when you're looking at, like you said negotiations earlier and some of these things that we have coming up, if you're, if you're losing a certain amount of stuff that you're top of the top and you're giving a certain percentage that percentage is higher for those kind of senior members. So that could actually change our forecast for projections of numbers to if you're losing a certain amount of folks at a top tiered payment versus, you know, kind of newer stuff coming at an entry level. Right. I would just, I know that, especially in the public safety areas they are. They are very good at promoting within their ranks. So it goes up so you're, you're, you've got. And I apologize, I don't know my, I think sergeant captain, all of those. Yeah, I think yeah so I don't know who lieutenant goes out there's a captain that's usually ready to go in. Okay, if that's the other way. Sorry, everybody. You know, so anyway there's there's usually somebody ready to promote up into that. So we'd have to really look to see how much savings you're really getting because it's the, the difference between the, the promotion is probably not as great as you know, we'll have to see what that. Okay, that's helpful to know that you're right they do they do that and they there needs to be that rank and file I mean specifically in public. Okay, the last question is around mid year what when is that coming to are we going to have a mid year budget again this year and what month I thought that came to us in February. So I, I'll be bringing an item. It's, I think it's targeted for March 26. Okay, three port item. It is a budget adjustment but what it is is is taking reserves and putting them into one time projects. Okay, so these are badly needed projects that we haven't been able to include through our normal operating budget. Because it simply wasn't the, the funding on the front end. So what we usually say is, we will wait until until we know our year in numbers. What we have left over. That's what we could parse out all the departments, especially the general fund departments contributed to this we vetted those those projects, focusing on some, you know, infrastructure facility infrastructure projects. Employee centric projects, things like that to try to, but focusing on one time. Okay, that's very helpful. Thank you. Okay. Now, if there's no more questions, we're going to go ahead and go for public comment on item 4.1. Madam host, do you have any public comments on item 4.1. I don't see any hands reached at this time. Did you have any questions. Please go ahead. Hi. So, first of all, kudos for the whole slide show. It really was like really amazing. The budgeting and everything and how you had each section. My question was, what would you do like, like I saw like last year. You went over last year's budgeting. You had like a lot left over. What would you do what what do you do with the extra money and where and where do you put it in like where do you put like where do you do my question. So, during public comment, you can make a comment to us or you can say that you'd like to know where this is coming. I'm just going to use this as an opportunity to talk about how public comment works. So if we don't answer your question, I don't want you to be offended. Oh, no, no, no, this is how it works in public comment. But if your question is, if I'm hearing you, what do we do with the leftover funds at the end of the year? Yes. Okay, do you put it towards like, like improving the city, the Santa Rosa, like when it comes to building or when it comes to like funding it to different things like homeless shelters or, you know, other things. So chair staff, would you like to ask any clarifying questions if it comes back after public comment? It's a good question. It is a good question. I think we make our CFO as well. Okay, well, we'll go ahead. Is there any more public comment on this item? Please go ahead. I'd like to see possibly a breakdown of the occupancy tax. Okay, is there public money going to put people in there that aren't tourists, you know, get them off the street, they're sleeping. So is there a differentiation or a breakdown of actual public funds money, whether it's state, county, city, as opposed to tourism or just local people, renting hotel rooms, et cetera. It's going to be interesting to see if there's a timeframe where that goes up way high when extra monies come in for certain programs, or if it's all on local charities that pay to get people in there. And that's part of the occupancy tax revenue that comes in. Is there a differentiation between public service and tourism? That's what I'd like to see. So if I'm clearing your question just so that I'm aware, you're asking to see if perhaps we're putting homeless folks in a hotel and that you're using public dollars to house people and that we're gaining occupancy tax or is it specific just want to know how we're who's occupying this space. That's not, it's not, it's just a differentiated because we know people get charity and get put into hotels, motels, and that is occupancy. There's a tax on that, right. And that's calculated in our end. So I'm just kind of curious what the percentage might be, you know, because certain programs may have come in and more people were able to get off the street and into, you know, temporary shelter. But is that part of the revenue that's counted on occupancy tax? You see what I'm saying? I do. Yeah. Okay, that's it. That's kind of just a general question, you know, or it's all thrown into one pot and hey, you know, we're doing good. It might be a false flag because it's not tourism. Anyway, that's just my comment. Thank you. Yeah. So in regards to homeless services, what might be helpful is when Kelly does a breakdown and budget review to actually be able to tell us how much are we spending at Sam Jones, how much are we spending at Caritas, how much are we spending in public dollars for occupancy and hotels so that we actually can see the breakdown as opposed to a whole that's four million dollars. Where does that four million go? And I think that's helpful from a council perspective as well to know this is actually where you're spending the four million dollars of public funds on things. So whether it's a question from the public or not, I found that that can be helpful to know where is our actual money going for which services. Because sometimes services are, you know, do have a better rate of return should show, so to speak. And I don't want to say that around homeless services, but we know that certain programs actually really help people get back into permanent housing. So I think knowing where we're investing our money and making the decisions and then seeing for me the breakdown of this is a highly effective program. And we have that a little bit with violence prevention program, we could see certain parts of that program were highly effective to throw a rate of recidivism. So if we're looking at this in sort of the same lens, I think that could be helpful and that would also answer the public's question. If, if you mind, don't mind. I think coming up. I'm not sure the exact meeting but I believe there's a homeless services study session on their strategic plan the first year of it. I know that I talked with director passenger and Kelly to include that, but I'm sure it's probably already in there. As they're going to go through it. Just as a general point of reference. If the city. I know during the pandemic, because we needed to deal with non congregate housing as, you know, as it related to COVID. We did contract with some hotels to put our homeless population, the more at risk population in there, but under those contracts. We don't get tax for that. So I, as far as I know, if, if there is, you know, I can't speak for nonprofits or charities or anyone else that goes into a hotel or what a rage, but they have. But we are from the tax that we're getting from that is from tourism. Pay the tax just to get it back another way. That would make sense. And answer your question. That was, yeah, thank you. And then as far as our year in budget, those funds just for clarification go to city manager and oftentimes are funding one time projects. And that's what we did when we've had money left. My understanding was city manager had a budget and then we looked at our priority list and then those funds were appropriated towards those. Yeah, those one time projects because it's not a real savings every year. It's just a little bit left over and then city manager of all of our department, she knows exactly what's happening and then she can appropriate that for those one time projects. The way a budget works. Just in general, we, we at the beginning of the year, we give appropriations to departments within a fund. So if we're talking about the general fund, we, we, we establish a budget for them. What the departments are able to spend, we assume they're going to spend all of their dollars. If they don't, the leftover funds are returned to the funding source from which they came. So, in that case, your general fund budget, anything left over goes into the general fund reserves. As committee member McDonald said, we, we do have a list internally of projects that that are one time in nature, because it's not in ongoing recurring source of funding. It's a one time source of funding. So we go through that list and then I will bring an item to council and appropriate funds. So take it out of those reserves and put them into a project. And then we, we complete that project. So that's the process. And then just for going over the presentation in large part, much of our leftover money states, as you will, was because we had a lot of staff that positions that hadn't been filled for the year. A department may have a lot of vacancies. So they'll have that little bit of leftover money and then that will go towards a one time. But the next year, we still budget for all of those vacancies to be taken because we need the staff. So, and we can and we're on target right now for a lot of those and we only move the money out into one time projects because we are above our council mandated reserve. Yeah. Okay. Well, I think we are moving on now. If there's no more public comment to future agenda items. Item number five. Do you have any items for future agenda? I keep talking about the budget and revenue. I'm going for you. I'd like to know kind of the all in on the golf course and where we're at since we're at about a year and a half, I think now with under that contract, including debt service so that we actually have a real number of what the golf courses is running us and what still needs to be done out there. We have that in mind because it's such a popular destination, but I think it's important for us to actually have the real numbers when we're looking at our deficit as well. Absolutely. We can do that. Great. My, my suggestion would be that we do that in our March meeting. Sure. The February meeting is in what two weeks. No problem. I don't know that we can pull that together. My suggestion would be that we cancel that meeting. And then, and then focus on better Valley golf course. In the March meeting, I know. We're also, I think it's, it's come up to talk about how we would analyze. In-house services versus. Contract services just in a general way how we would do that cost benefit analysis. So that would be and March or April. Discussion there. But definitely we can do the better Valley one in March. I'll talk with. In-house services. Okay. Anything else? All right. Well, but that we are adjourned for the meeting and our next meeting will be February 8th. We're going to cancel that one. The next one will be March. Oh, sorry. March 14th. March 14th. March 14th. March 14th. I don't think we have a meeting to talk with you about that. But yes. Rogers mentioned it. So I just wanted to record that we're probably going to figure. Right. Figure. 330 to 430. Thank you so much for the presentation. It's always so informative.