* This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting. [Press Conference: "Announcing Priorities for FY2023 Budget Workshops"] [00:00:02] THIS IS THE DAY. ALL RIGHT. THIS, UM, AT THIS POINT, I THINK ALL, I THINK BELIEVE ALL OF THE COUNCIL MEMBERS HAVE ACHIEVED THE, UH, THE BUDGET FOR 2023, THE FISCAL YEAR. THIS IS, THIS IS IT, AND, UH, HAS BEEN PRESENTED TO, UH, TO THE COUNCIL MEMBERS. AND WE WILL, UH, TAKE IT UP, I THINK THE FIRST PART OF JUNE. SO WE ARE HERE TO SPEAK UP, SPEAK ON THE, ON THE BUDGET. LET ME, LET ME ACKNOWLEDGE, UH, THE COUNCIL MEMBERS WHO ARE, WHO ARE STANDING, UH, WITH ME TODAY. MAYOR PRO TEM, DAVE MARTIN, UH, COUNCIL MEMBER SALLY ALCORN, COUNCIL MEMBER TIFFANY THOMAS, COUNCIL MEMBER DAVE ROBINSON, AND COUNCIL MEMBER TASHA JACKSON. AND I APPRECIATE ALL OF YOU, UH, FOR BEING HERE TO TODAY. AND THEN I CERTAINLY WANT TO, I WANT TO ACKNOWLEDGE, UH, THE FINANCE DIRECTOR, TAN EMO AND ASSISTANT FINANCE DIRECTOR, WILL JONES, UH, BECAUSE IT'S, UH, WHAT WE ARE SEEING AND WE'LL BE TALKING ABOUT TODAY. THEY HAVE SPENT A GREAT DEAL OF TIME, UH, THE TWO OF THEM AND THEIR RESPECTIVE TEAMS, UH, WORKING ON THIS, ON THIS, ON, ON THE BUDGET, UH, FOR 20 FISCAL YEAR 2023. AND THEN, UH, CERTAINLY, UH, SEE A NUMBER OF THE DIRECTORS HERE, HERE, UH, 23 OF THEM. AND SO, UH, UH, DIRECTOR, UH, EMO COULD NOT HAVE, UM, UM, THEY COULD NOT BE PRESENTING THIS BUDGET WITHOUT THE COOPERATION, THE COLLABORATION OF ALL OF THE, UH, THE DEPARTMENTS WHO WANT TO THANK THEM. AND THEN I WANT TO ACKNOWLEDGE THE CHIEF OF STAFF, MARETTE HUNTER, WHO'S BEEN A PART OF MOST OF THOSE, IF NOT ALL OF THOSE MEETINGS. UH, SO THANK YOU SO VERY MUCH. UH, AND THEN OF COURSE, WALTER HAMRICK IS BRINGING US NOW ON BOARD. SO, UM, LEMME JUST SAY, UM, UH, GOOD MORNING TO EVERYONE. UH, THIS IS THE FISCAL YEAR 2023 PROPOSED BUDGET. UH, AND I'M PLEASED TO PRESENT THE PROPOSED BUDGET FOR, FOR THIS, FOR THIS UPCOMING YEAR. THE PROPOSED BUDGET FOR ALL FUNDS TOTAL 5.71 BILLION, UH, THAT'S WITH A B, UH, AND INCREASE OF $487 MILLION OR 9.3% COMPARED TO FISCAL YEAR 2022. UH, CURRENT BUDGET OF 5.22 BILLION. UH, LET ME, AS A PARENTHETICAL NOTE, UH, THE ENTERPRISE FUNDS ACCOUNTS FOR 364 MILLION. OF THAT 487 MILLION, UH, DOLLAR INCREASE, PRIMARILY DUE TO COST IN THE COMBINED UTILITY SYSTEM RELATED TO THE CONSENT DECREE AND OTHER DRINKING WATER PROJECTS, AND FOR COUNCIL MEMBERS AND FOR OTHERS, YOU KNOW, THAT, UH, THE CITY OF HOUSTON HAS BEEN DEALING, HAVE BEEN DEALING WITH THAT CONSENT DECREE SINCE 2010. MM-HMM . SO IT WAS FINALLY OF, UM, UM, UH, SIGNED OFF, UH, BY THE, UH, THE FEDERAL GOVERNMENT, EPA DEPARTMENT OF JUSTICE AND THE CITY OF HOUSTON. AND THAT WILL COVER A SPAN OF, UH, 15 YEARS. SO, UH, THE $364 MILLION, A SIGNIFICANT PORTION OF THAT, UH, IS FOR THAT CONSENT DECREE AS WELL AS FOR THE OTHER DRINKING AND WATER PROJECTS. BUT THAT ACCOUNTS FOR THAT INCREASE OF 487. THE PROPOSED GENERAL FUND, UH, BUDGET OF 2.74 BILLION REFLECTS AN INCREASE IN SPENDING OF $102 MILLION OR 3.8% FROM THE FISCAL YEAR 2022 CURRENT BUDGET OF 2.64 BILLION. THIS INCREASE IS PRIMARILY ATTRIBUTABLE TO PAY INCREASES FOR ALL EMPLOYEE GROUPS, INCLUDING 6% FOR FIRE, 4% FOR POLICE, AND 3% FOR MUNICIPAL EMPLOYEES. AND AGAIN, JUST AS A REMINDER, UH, WE ARE PROVIDING OUR FIREFIGHTERS FROM THE HOUSTON CHIEF PENO. UH, WHY DON'T YOU SAY A LOT OF THIS, YOU, YOU KNOW, YOUR DEPARTMENT'S GETTING, UM, AND , AND THAT IS, AS YOU COULD, IF EVERYONE CAN RECALL, FIVE FIGHTERS WILL BE GETTING A PAY RAISE AT A MINIMUM OF 18% OVER OVER THREE YEARS. AND SO 6% FOR THE FISCAL YEAR, 2023. AND THEN OF COURSE, AGAIN, FOR THE POLICE DEPARTMENT OF THEIR PAY RAISE IS 10.5% OVER THE NEXT THREE YEARS. IN THIS, THIS IS THE FIRST YEAR, 4%. AND THEN FOR MUNICIPAL WORKERS, IT IS 9% OVER THREE, AND THIS IS THE INITIAL ONE OF 3%. UM, ADDITIONALLY, THIS BUDGET INCLUDES OPERATIONAL FUNDING FOR FACILITIES SUCH AS THE NEW A EAF NEIGHBORHOOD CENTER. AND AS YOU [00:05:01] KNOW, THAT WILL BE OPENING UP THIS YEAR. AND SO, AND I KNOW A EAF HAS BEEN WAITING ON, ON THE NEW A EAF CENTER FOR, AT THIS POINT, 25 PLUS YEARS. SO, UM, UH, WE LOOK FORWARD TO CELEBRATING THE OPENING OF THE NEW A ELITE CENTER. SO THERE, THIS BUDGET INCLUDES OPERATIONAL FUNDING FOR THAT ONE, THE RENOVATED KENDALL LIBRARY, AND THE DR. SHANNON WALK WALKER LIBRARY AS WELL. FISCAL YEAR 2022 EXPERIENCE INCREASES ACROSS MANY REVENUE STREAMS AS OUR LOCAL ECONOMY OUTPERFORMED ALL EXPECTATIONS. HOWEVER, MAKE NO MISTAKE, COVID-19 IS STILL HERE AND CONTINUES TO IMPACT OUR COMMUNITIES. THE FISCAL YEAR 2023, PROPOSED GENERAL FUND BUDGET UTILIZES $160 MILLION, UH, FROM THE AMERICAN RESCUE PLAN, THE OPERA FUNDING TO RECOGNIZE THE ECONOMIC IMPACT OF COVID-19 AND ADDRESS THE REDUCTION IN REVENUES DUE TO THE PUBLIC HEALTH EMERGENCY, UH, SIGNIFICANT UNCERTAINTY. AND AGAIN, THAT'S 160 OF THE INITIAL TRANCHE OUT OF THE 3.3, 303, UH, MILLION DOLLARS, UH, FROM OPERA FUNDING. I WILL SAY VERY QUICKLY THAT THE SECOND TRANCHE HAS NOT BEEN RECEIVED. UM, AND WE ARE WAITING ON THAT. BUT OUT OF THAT 303, UH, MILLION, THE INITIAL 160 OF IT IS INCLUDED IN THIS, IN THIS BUDGET, AND THE REST OF IT HAS ALREADY BEEN, UH, COMMITTED. UM, SIGNIFICANT UNCERTAINTY REMAINS IN THE ECONOMY WITH REINFLATION RATES, SURGING INTEREST RATES ON THE RISE, GAS PRICES, SOARING AND GLOBAL UNREST WITH THE RUSSIA, UKRAINE WAR. ALL THESE THINGS CREATE AN EXTREMELY VOLATILE SITUATION, AND IT'S IMPERATIVE THAT WE BUILD AND PRESERVE A STRONG FUND BALANCE HEADING INTO FISCAL YEAR 2023. WITH THAT BEING SAID, THIS PROPOSED BUDGET INCLUDES AN ENDING FUND BALANCE OF $311 MILLION, WHICH IS 13.5% OF EXPENDITURES LESS DEBT SERVICE AND PAY AS YOU GO WELL ABOVE THE MINIMUM OF 7.5% ESTABLISHED IN THE CITY'S FINANCIAL POLICIES. AND WHAT DOES THAT MEAN? THAT MEANS ABOVE THAT SEVEN POINT, UH, 5%, UH, THERE IS A FUND BALANCE OF $138 MILLION ABOVE THAT 7.5% OF EXPENDITURES, LESS DEBT SERVICE. ADDITIONALLY, UH, THIS BUDGET DOES NOT DRAW DOWN FROM THE FUND BALANCE AT ALL. SO THAT 13.5% REMAINS INTACT. UH, THAT 138 MILLION ABOVE THE 7.5 IS STILL IN THIS, UH, IS STILL IN THE BUDGET, AND NEITHER DOES THIS BUDGET, UH, INCLUDE ANY ONE TIME LAND SALES OR DEFERRALS. WITH REGARDS TO THE BUDGET STABILIZATION FUND, UM, UH, WE WILL FULLY FUND, UH, THE BUDGET STABILIZATION FUND, PLACING THE CITY IN A BETTER POSITION HEADING INTO HURRICANE SEASON. AND THAT IS IN EXCESS OF 20 OF $20 MILLION. SO AS WE PREPARE TO GO INTO HURRICANE SEASON, UH, WE WILL, WE, THE, UH, THE STABILIZATION FUND WILL BE FULLY FUNDED WITH REGARDS TO THE IMPACT OF THE PROPERTY TAX REVENUE CAP. THE FISCAL YEAR 2023 PROPOSED BUDGET IS BASED ON THE EXISTING PROPERTY TAX REVENUE CAP. DEPENDING ON THE TAXABLE VALUATION, WE MAY HAVE TO ADJUST OUR TAX RATE TO COMPLY WITH THE PROPERTY TAX REVENUE CAP. AND WHAT THAT MEANS IS THAT DEPENDING ON, AS WE EVALUATE, UM, UH, THE TAXABLE VALUATION, UH, MEMBERS OF CITY COUNCIL MAY BE CALLED ON TO LOWER THE TAX RATE. AGAIN, A HIGHER TAXABLE VALUE MAY RESULT IN TAX, IN, IN, IN A TAX RATE, REDUCTION IN VIEW OF THE INCREASE IN PROPERTY VALUE, AND TO PROVIDE RELIEF TO SENIOR CITIZENS AND THE DISABLED. I WILL BE PROPOSING TO THE MEMBERS OF COUNCIL, I WILL BE PROPOSING IN A SEPARATE MEASURE IN JUNE, IF NOT BEFORE, TO INCREASE THE OVER 65 AND DISABLED TAX EXEMPTIONS FROM 160,000, WHICH EXISTS TODAY TO $260,000. IN FISCAL 2023 ALONE, THE FULL IMPACT OF THE CAP WILL RESULT IN A LOSS OF $282 MILLION. BECAUSE OF THE REVENUE CAP THAT EXISTS SINCE HITTING THE CAP IN FISCAL YEAR 2015, THE FULL CUMULATIVE IMPACT OF THE REVENUE CAP IS $1.4 BILLION. [00:10:02] NOW, LET ME JUST SAY, WE COULD HAVE DONE A GREAT DEAL, EVEN WITH POLICE, WITH FIRE SOLID WASTE, AND LET ME UNDERSCORE SOLID WAGE IF THOSE DOLLARS WERE MADE AVAILABLE. BUT WHAT I WANT TO UN UNDERSCORE HERE, WE RECOGNIZE PROPERTY VALUES HAVE INCREASED 20%, AND IN SOME CASES MORE, WE RECOGNIZE ALL OF THE ELEMENTS THAT PEOPLE ARE HAVING TO FACE IN OUR, IN OUR CITY, ESPECIALLY OUR SENIORS, PEOPLE WHO WERE DISABLED. AND SO IS MY HOPE THAT WHEN WE PUT FORTH THE ORDINANCE TO MEMBERS OF CITY COUNCIL TO INCREASE, UH, THAT EXEMPTION, THAT, UH, THE TAX EXEMPTION FROM 160,000 TO 260,000, UH, THAT THAT WOULD BE APPROVED, IT WILL PROVIDE SIGNIFICANT, UH, RELIEF FOR OUR SENIORS AND OUR DISABLED COMMUNITY WITH REGARDS TO PUBLIC SAFETY. THIS PROPOSAL LEAVES THE CITY OF HOUSTON IN A BETTER POSITION AS WE FACE THESE ECONOMIC UNCERTAINTIES, AND AT THE SAME TIME, IMPOSE OUT MY, OUR PRIORITIES WITH PUBLIC SAFETY AT THE FOREFRONT, THIS BUDGET WILL BE FULLY FUNDING FIVE CADET CLASSES EACH FOR FIRE AS WELL AS POLICE. THE CURRENT POLICE COUNT IS 5,117, WITH ANOTHER POLICE CADET CLASS, UH, EXPECTED TO GRADUATE, UH, BY THE END OF JUNE, POSSIBLY TWO, BUT BELIEVE THAT ONE JUST LAST WEEK. THAT WAS A CADET CLASS THAT GRADUATED 55 POLICE OFFICERS LAST WEEK. AND THERE'S ANOTHER CADET CLASS THAT IS IN PROGRESS AS WE SPEAK. UH, SO THE HOPE IS THE NUMBER WILL CONTINUE, WILL ADD, LIKE ALL MAJOR CITIES IN OUR NATION, HOUSTON HAS EXPERIENCED AN INCREASE IN VIOLENT CRIME BECAUSE OF THE COVID-19 PANDEMIC AND OTHER FACTORS, UH, WHICH IS WHY I, WE ENACTED THE ONE SAFE HOUSTON CRIME REDUCTION INITIATIVE. ONE. SAFE HOUSTON IS A COMPREHENSIVE VIOLENCE REDUCTION INITIATIVE THAT LINKS RESEARCH BASED STRATEGIES TO IMPROVE PUBLIC SAFETY AND REDUCE THE HARMS CAUSED BY VIOLENT CRIME, FOCUSING ON FOUR KEY AREAS, VIOLENT REDUCTION IN CRIME PREVENTION, CRISIS INTERVENTION, RESPONSE AND RECOVERY, YOUTH OUTREACH OPPORTUNITIES, AND KEY COMMUNITY PARTNERSHIPS. BASED ON OUR REVIEW, UM, THE STEPS THAT HAVE BEEN PUT IN PLACE UNDER ONE, SAY, HOUSTON ARE WORKING VIOLENT CRIME, AND ALMOST EVERY CATEGORY IS DOWN YEAR TO DATE YOU ON EXCEPTION, UH, IS WITH REGARDS TO HOMICIDE. BUT IF YOU COMPARE WHERE WE WERE IN JANUARY OF THIS YEAR TO WHERE WE ARE TODAY, UH, THE NUMBERS HAVE PLUMMETED EVEN AS IT RELATES TO HOMICIDES. BUT WE STILL, WE STILL HAVE WORK TO DO. UH, I INITIALLY ADVANCED, UH, $5.74 MILLION FOR OVERTIME ADDING 125 OFFICERS PER DAY. UM, AND ALTHOUGH NOT A PART OF THIS BUDGET, WE WILL BE ADVANCING AN ADDITIONAL $5 MILLION IN OPERA FUNDING, UH, TO HPD TO CONTINUE THIS OVERTIME INITIATIVE. WHAT WE STARTED IN FEBRUARY IS IMPORTANT THAT WE CONTINUE AND LET THERE BE NO MISTAKE THAT PUBLIC SAFETY IS OUR NUMBER ONE PRIORITY, AND WHEN THINGS ARE WORKING, I THINK IT IS ALWAYS PRUDENT FOR US TO CONTINUE, UH, ON THAT TRACK AS WE CONTINUE TO MOVE FORWARD ON OUR COMMUNITY INITIATIVES, AS WELL AS ON OUR CRISIS INTERVENTION. AND THEN THE GUN BUYBACK PROGRAM IS EXPECTED TO, TO, UM, BE, UH, TAKE EFFECT IN JUNE OR JULY OF THIS YEAR. IN ADDITION TO ONE SAFE HOUSTON INITIATIVES, WE HAVE ALSO ALIGNED OUR PLANS TO BRING ONLINE NEW AND RENOVATED LIBRARIES AND MULTI-SERVICE CENTERS, TRAVEL COMMUNITIES, IMPROVE AND UPGRADE NEIGHBORHOOD PARKS THROUGH OUR LOVE, OUR PARKS COMPLETE COMMUNITIES INITIATIVE. PHASE ONE OF THIS PROGRAM TARGETED FIVE PARKS AND UNDER-RESOURCED COMMUNITIES, WHICH ENHA ENHANCED NEIGHBORHOOD PRIDE, PHASE TWO AS FIVE ADDITIONAL PARKS. TO CONTINUE THIS FR PROGRAM, PHASE ONE INCLUDED MALONE PARK, OUR PARK, HENDERSON PARK, DESH PARK, AND WOODRUFF PARK. PHASE TWO INCLUDES IRVINGTON PARK, HOBERT, TAYLOR PARK, LINCOLN PARK, VELA PARK, AND INDEPENDENT HEIGHTS PARK. LET ME QUICKLY SAY THAT THESE ARE IN ADDITION TO THE 22 PARKS BEING SIGNIFICANTLY ENHANCED, WHICH THOSE ENHANCEMENTS SHOULD ALL BE COMPLETED, UH, BY DECEMBER OF 2023. 11 OF THOSE PARKS, I THINK WILL BE COMPLETED, UH, BY BEFORE JANUARY OF NEXT YEAR. IN CLOSING, THE FISCAL YEAR 2023 PROPOSED BUDGET IS, IN MY CASE, MY SEVENTH, UH, CONSECUTIVE BUDGET THAT IS BALANCED, RECOGNIZING THAT IN THIS ONE WE ARE USING OPERA FUNDING, BUT, UH, WE HAVE NEVER FACED COVID EITHER. [00:15:01] SO, UM, WITH THOSE EXIGENT CIRCUMSTANCES, UH, WE ARE MOVING FORWARD. UH, BUT IT DOES REPRESENT OUR, UH, BALANCED BUDGET. WE HAVE ADDRESSED PENSION REFORM IN 2017 THAT REDUCED THE CITY'S UNFUNDED LIABILITY FROM 8.2 BILLION TO 1.5 BILLION. WE HAVE ADDRESSED OPE REFORM THAT WAS EFFECTIVE JANUARY OF 22. THAT WILL REDUCE THE CITY'S NET, UH, O OTHER POST-EMPLOYMENT BENEFIT LIABILITY TO HAVE OVER THE NEXT 30 YEARS, FROM 9.1 BILLION TO 4.5 BILLION. WE HAVE AUTHORIZED SIGNIFICANT PAY RAISES, UM, COUNCIL MEMBERS TO THE THREE EMPLOYEE GROUPS, INCLUDING THE 6% FOR FIRE, 4% FOR POLICE, AND 3% FOR MUNICIPAL EMPLOYEES. WE HAVE ALSO BROUGHT ALL OF OUR CITY EMPLOYEES TO A MINIMUM OF $15 PER HOUR. OUR FUND BALANCE IS STRONG WITH 138 MILLION ABOVE THE REQUIRED 7.5% OF EXPENDITURES THAT DEATH SERVICE, UH, PAY AS YOU GO. AND I ANTICIPATE EVEN THAT FUND BALANCE TO RISE AND THE BUDGET STABILIZATION FUND AS WE APPROACH HURRICANE SEASON IS FULLY FUNDED. AND THIS WILL LEAVE THE CITY IN A MUCH BETTER POSITION AS WE GO INTO THE HURRICANE SEASON, AS WELL AS PREPARING THE CITY FOR THE LOOMING ECONOMIC UNCERTAINTIES THAT FACE US ALL. HAVING SAID THAT, UH, MEMBERS, I PUT FORTH, UH, THIS BUDGET ASKING FOR YOUR UNANIMOUS CONSENT WITHOUT ANY AMENDMENTS, AS THEY LAUGH ON THAT REMARK, BUT THAT, THAT, THAT CONCLUDES, UM, MY INITIAL PRESENTATION. ANY TAKE, ANY QUESTIONS? THANK YOU, MAYOR. UM, OBVIOUSLY THIS BUDGET IS LARGELY MADE POSSIBLE BY THE, THE FEDERAL MONEY THAT Y'ALL HAVE RECEIVED OVER THE LAST FEW YEARS. DID YOU GUYS WORK UP ANY KIND OF ESTIMATE FOR WHAT THE BUDGET GAP WOULD'VE LOOKED LIKE ABSENT THAT MONEY THIS YEAR? UH, UH, I THINK IT WAS STILL ABOUT THE ONE 60. IT WOULD STILL BE ABOUT 1 60, 1 60. UM, AND YOU SAID THE BUDGET RELIES ON $160 MILLION OF THIS YEAR'S ALLOTMENT OF, OF THE ARPA FUNDS? YES. WHAT IS THAT MONEY GOING TOWARDS? IS IT JUST SORT OF PAYING FOR PAYROLL THAT YOU WOULD'VE HAD TO COVER OTHERWISE WITH TAXES? THAT'S POLICE, THAT'S FIRE, ALL OF THE THINGS. THOSE ARE THE DOLLARS THAT WE LOST AS A RESULT OF COVID AND WHICH, UM, THE OPERA FUNDS ARE, UM, WHICH IS AN ALLOWABLE USE. SO THAT REPRESENTS THE, THE REVENUE THAT WE LOST. AND SO THAT'S WHY THAT'S THE 160 COMES INTO PLAY. UH, BUT WHAT WE'RE TRY TO DO IS, IS ANCHOR THAT THOUGH WE ARE USING, LET'S SAY, 160 MILLION, THE FUND BALANCE IS GROWING. SO THE FUND BALANCE IS 311 MILLION. AND, AND THEN WHEN YOU FACTOR IN THAT 7.5 IS 138 MILLION ABOVE THE 7.5, AND I DO ANTICIPATE IT GROWING. THERE ARE CERTAIN THINGS THAT I, THAT I DID NOT MENTION, FOR EXAMPLE, THIS BUDGET ASSUMES NO POPULATION INCREASE. NOW THOSE NUMBERS WON'T COME OUT UNTIL THE END OF MAY. AND TO THE EXTENT THERE IS A POPULATION INCREASE, UH, THEN, UH, THE FUND BALANCE SHOULD GROW. BUT WE DON'T KNOW THAT YET. IS THAT BECAUSE YOU'RE HITTING THE, THE VOTER IMPOSED PROPERTY TAX CAP, AND SO IF THERE IS POPULATION GROWTH, YOU WOULD BE ABLE TO COLLECT? NO, IT'S JUST EVERY, EVERY YEAR THAT THE CENSUS, THEY WILL SEND US OUR NUMBERS. UM, AND THOSE NUMBERS GENERALLY COME IN, UH, RIGHT AROUND THE END OF MAY. IF, FOR EXAMPLE, IF, LET'S SAY IF WE HAD SAID THAT THERE WAS GONNA BE A ONE OR 2% POPULATION INCREASE AND WE FACTOR THAT INTO THE BUDGET AND, AND WE TURN OUT AND TO BE WRONG AND OUR NUMBERS WERE LOWER, THEN WE WOULD HAVE TO REDUCE OUR FUND BALANCE. WHAT, WHAT I HAVE INSTRUCTED FINANCE TO DO IS THAT WE ARE GOING IN THIS BUDGET FROM A CONSERVATIVE POINT OF VIEW, WE DON'T ASSUME ANY POPULATION GROWTH, ANY, UM, AND THE HOPE IS THAT THERE WILL BE POPULATION GROWTH AND THEN THE FUND BALANCE TOO WILL GROW. UM, YOU TALKED EARLIER ABOUT THE IMPACT OF THE CAP THIS YEAR. JUST TO BE CLEAR, IS THAT THE CAP THAT YOU'RE HITTING OR ANTICIPATING HITTING THIS YEAR? IS THAT THE CITY CAP OR THE STATE CAP? THAT IS THE CITY'S CAP. OKAY. THAT'S, UH, STARTING, GOING BACK TO 2015, MOVING FORWARD, UH, BECAUSE, UM, WE HAVE HIT THE CITY'S CAP, WE HAVE NOT BEEN ABLE TO TAKE A ADVANTAGE OF ABOUT $1.4 BILLION ON THE CITY'S CAP. NOW, BEAR IN MIND THERE'S ANOTHER STATE CAP THAT IS, IT'LL SAY ABOVE THAT, BUT EVEN IF YOU'RE JUST LOOKING AT THE CITY'S CAP, UH, OR SINCE 2015 TO WHERE WE ARE TODAY, UH, WE HAVE NOT BEEN ABLE TO TAKE ADVANTAGE OF ABOUT 1.4 BILLION. AND JUST IN THIS BUDGETARY CYCLE, I THINK THE NUMBER IS LIKE 264, SOMETHING LIKE THAT. YOU TALKED ABOUT THE SORT OF NOTABLY LARGE FUND BALANCE, AND I THINK IT'S A 50% INCREASE FROM WHAT WAS RESERVED LAST YEAR. YES. I KNOW YOUR COUNCIL MEMBERS ARE GONNA HAVE IDEAS [00:20:01] OF HOW TO SPEND THAT MONEY. UM, HOW COMMITTED ARE YOU TO STAYING AT THAT 300 OVER, UM, OR IS THERE GONNA BE SOME FLEXIBILITY THERE TO SPEND SOME FUNDS ON CIRCUITS? WELL, WE WORK, WE WORK AS A TEAM. AND WHAT YOU, WHAT, UH, I THINK WHAT WE ALL RECOGNIZE IS, UM, THE COST DRIVERS, SOME OF THE MAJOR COST DRIVERS WILL BE DRIVING THIS BUDGET FOR THE NEXT SEVERAL YEARS. THE, THE, UH, THE PAY RAISES, FOR EXAMPLE, FOR POLICE, FIRE, MUNICIPAL WORKERS. WE ARE ONLY DEALING WITH THE FIRST YEAR OF THREE YEAR CONTRACTS. AND I DON'T BELIEVE, UH, THE CITY COUNCIL MEMBERS AND CERTAINLY, YOU KNOW, I DON'T WANT TO PUT, UM, FUTURE MAYORS, FUTURE COUNCIL MEMBERS IN A, IN A, IN A WORSE POSITION. AND SO, AND THESE, THESE UPPER DOLLARS ARE GOING TO RUN OUT. OKAY. SO THAT'S WHAT, UH, THESE OPERA DOLLARS EVEN, LET'S ASSUME THAT THE SECOND TRENCH COMES. AND UNTIL WE GET 'EM, I NEVER, YOU CAN'T COUNT ON IT. UH, BUT LET'S ASSUME THAT THEY COME, THOSE DOLLARS HAVE TO BE COMMITTED BY 2024. OKAY, WELL, YOU STILL HAVE TO LIVE IN 25, AND YOU HAVE CON YOU HAVE CONTRACTUAL COMMITMENTS THAT WILL GO BEYOND, UH, THIS YEAR OR NEXT YEAR. SO I DO THINK IT'S, IT IS VERY IMPORTANT TO MAINTAIN A HEALTHY, FUN BALANCE. AND AGAIN, YOU NEVER KNOW WHEN YOU MAY BE FACING ANOTHER, UH, COVID SITUATION OR SOME OTHER NATURAL DISASTER. AND RIGHT NOW YOU JUST CAN'T FOCUS ON HURRICANE SEASON. WINTER STORM URI CAME IN FEBRUARY. SO I THINK A HEALTHY FUND BALANCE IS, IS, UM, IS IN THE CITY'S BEST INTEREST. AND SO IT IS MY HOPE, UH, THAT WE WILL CONTINUE TO HOLD ON TO THE FUND BALANCE WITH REGARDS TO THE COUNCIL MEMBERS. UH, WE ARE NOT, UH, UH, TAKING AWAY ANYTHING FROM THE COUNCIL DISTRICT SERVICE FUND. SO THAT CONTINUES IN THIS PARTICULAR BUDGET, AND THEY'VE BEEN VERY PRUDENT IN THE UTILIZATION OF THOSE COUNCIL DISTRICT SERVICE FUND. UH, QUITE FRANKLY, THEY'VE COMPLIMENTED, UM, THE THINGS THAT THIS ADMINISTRATION HAS DONE. SO WE ARE NOT, WE'RE NOT DISTURBING THAT AT ALL. BUT I DO HOPE, UM, THAT THE FUND BALANCE AS MUCH AS POSSIBLE, WILL REMAIN. AND QUITE FRANKLY, IT NEEDS TO GROW. SO AS WE WEAN, AS THE CITY WEANS ITSELF, EVENTUALLY OFF THE OPERA FUNDING, YOU'RE GONNA BE BACK WITH THE FUND BALANCE. THE GOOD NEWS IN THIS BUDGET IS NOT, IS NOT RELYING ON DEFERRALS OR LAND SALES. AND, AND WE ARE NOT SPENDING DOWN THE FUND BALANCE. UH, BUT THE GOAL IS FOR THAT TO GROW. SO, BUT AGAIN, I, YOU KNOW, I BELIEVE THAT THE COUNCIL MEMBERS WILL, WILL MAKE GOOD JUDGMENTS, AND THIS IS SORT OF GRANULAR, BUT NONE OF THE ARPA FUNDS ARE CONTRIBUTING. I MEAN, THEY'RE CONTRIBUTING INDIRECTLY TO THAT FUND BONDS, BUT THAT 300 TO $11 MILLION ISN'T COMING DIRECTLY FROM THE ARPA FUND. RIGHT. IF YOU WILL, LOOK, THE SALES TAX HAVE HAVE EXPONENTIALLY GROWN. UM, THE, THE SALES, THE SALES TAX, UH, RETURNS HAVE EXCEEDED, UH, BOTH THE COMPTROLLER'S EXPECTATIONS AS WELL AS THE FINANCE DEPARTMENT'S EXPECTATIONS, WHICH HAS BEEN GOOD NEWS, UH, FOR THE CITY OF HOUSTON. SO THAT'S, THAT'S, THAT'S, THAT HAS BEEN A VERY POSITIVE NOTE. AND EVEN WITH RESPECT TO OUR SALES TAX, UM, EXPECT, UM, THE EXPECTATIONS, UH, WE'VE TAKEN A CONSERVATIVE VIEW OF THAT AS WELL. I THINK EVEN WITHIN IN THIS BUDGET, WE KIND OF ASSUME THAT THINGS WILL REMAIN FLAT GOING FORWARD. AND IF THE SALES TAX PROJECTIONS CONTINUE TO OUTPERFORM OUR EXPECTATIONS, THEN THAT WILL BE HELPFUL. THE OTHER THING, AND LEMME JUST MAKE, LEMME GO BACK TO THE FUND BALANCE. I JUST THOUGHT ABOUT THIS, UM, SOLID WASTE. UM, AND LET ME UNDERSCORE, THE CURRENT WAY THAT WE ARE FUNDING SOLID WASTE, UH, IS NOT SUSTAINABLE. OKAY. IT'S JUST NOT SUSTAINABLE. SO EVEN A SEPARATE AND APART FROM POLICE AND FIRE, WE ARE CONSTANTLY HAVING TO PUT RESOURCES INTO SOLID WASTE. SO TO PICK UP HEAVY TRASH, FOR EXAMPLE, THERE WILL BE A MEASURE COMING BEFORE CITY COUNCIL, WE'LL SOON TO ADD, FOR EXAMPLE, LIKE ANOTHER $2 MILLION ON JUST HEAVY TRASH PICKUP. SO SOLID WAYS UNDER THE CURRENT CON CONFIGURATION IS NOT SUSTAINABLE IN THE LONG RUN. WE ARE ABLE TO MEET MANY OF OUR NEEDS AND WE'LL DO EVEN MORE, BUT THAT'S FOR NOW AND TO NEXT YEAR. BUT ONCE YOU GET PAST 2023 GOING INTO 2024, MY WARNING TO THE PEOPLE IN THE, IN THE CITY OF HOUSTON AS WELL AS TO THE CITY COUNCILMEN, IS THAT THERE MUST BE ANOTHER WAY OF FUNDING SOLID WASTE. THERE ARE MORE PEOPLE MOVING INTO THE CITY. THERE ARE MORE HOUSES BEING BUILT INTO THE CITY. THE ROUTES ARE BECOMING VERY DIFFICULT FOR OUR SOLID WASTE. I MEAN, TO COMPLETE AND, AND, UM, [00:25:01] UH, ON SCHEDULE ON TIME. SO THERE WERE, I STRONGLY, UM, WOULD SAY TO THE PEOPLE IN THE CITY, TO OUR COUNCIL MEMBERS, UH, THAT THE CURRENT WAY OF FINANCING SOLID WASTE IS NOT, IS NOT SUSTAINABLE. CAN I ASK JUST A FOLLOW UP QUESTION ON THAT? 'CAUSE, YOU KNOW, SOLID WASTE HAS MENTIONED THEY NEED A BUDGET PROBABLY OF SOMEWHERE AROUND LIKE $125 MILLION ADEQUATELY PROVIDE WANT TO FOR THIS. SO IF YOU'VE GOT A, YOU KNOW, A SURPLUS ABOVE THE 7.5% OF OVER A HUNDRED MILLION DOLLARS, DID YOU CONSIDER AT ALL TAKING, YOU KNOW, THEIR 20, $30 MILLION AND GIVING THAT TO SOLID WASTE TO TRY TO IMPROVE THEIR SERVICE? NO. AND, AND THIS IS THE REASON THAT'S ONE DEPARTMENT OUT OF 23. IT'S THE, THAT THAT'S NOT, THAT DOESN'T MAKE THE SYSTEM SUSTAINABLE. THAT JUST PULLS DOWN EVERYBODY ELSE. AND THAT PUTS US IN A VULNERABLE NEED IN CASE THERE'S ENT CIRCUMSTANCES THAT WILL ARISE. SO THAT'S, THAT'S NOT, THAT'S NOT THE WAY TO DO IT. UM, AND AGAIN, UH, WE WILL BE ABLE, I BELIEVE, TO MOVE FORWARD AND PUT SOLID WASTE IN A POSITION TO ADDRESS CONCERNS, UH, FOR FISCAL YEAR 23 AND, UH, FISCAL YEAR 24. BUT I'M SAYING IN THE LONG TERM, IN THE LONG TERM, AND FOR THE HEALTH AND SAFETY OF THIS CITY, UH, THE WASTE, SOLID WASTE IS BEING FUNDED WITH THE REVENUE SOURCES COMING IN UNDER THE CURRENT MECHANISMS THAT IS NOT SUSTAINABLE IN THE LONG TERM. SO I GUESS, YOU KNOW, I'M JUST, I'M, I'M JUST PUTTING IT OUT. I'M JUST PUTTING IT OUT, UH, THAT, UH, WE REALLY NEED TO TAKE A SERIOUS LOOK. UH, AND WE ARE THE ONLY CITY, ONLY MAJOR CITY IN THE UNITED STATES THAT FUNDS SOLID WASTE AS WE ARE DOING NOW. TIME IS NOT ON OUR SIDE. THAT'S JUST MY, MY WARNING. YES, SIR. I'M SORRY. SO YOU HIT ON SOME OF IT THERE, THERE'S BEEN TALK ABOUT WHETHER A BUDGET IS BALANCED VERSUS STRUCTURALLY BALANCED. GO INTO MORE DETAIL WHY YOU BELIEVE BALANCE IS IN FACT STRUCTURALLY BALANCED, TOP OF THAT, KIND OF HEAR THE BUZZWORD DEFUNDING BUDGET AND PUBLIC SAFETY AND LAW THAT AS WELL. YEAH. WELL, WE'VE NEVER DEFUNDED POLICE IN THE CITY OF HOUSTON. UH, EVEN IN 20, IN 2020 WHEN THIS BUDGET WAS APPROVED, IT WAS A 13% INCREASE. UM, SO WE'VE NEVER, WE'VE NEVER DEFUNDED, UM, BUT WE ARE MAKING INVESTMENTS IN THE COMMUNITY. OKAY. COMPLETE COMMUNITIES HAS ALWAYS BEEN FOCUSING ON COMMUNITIES AND NEIGHBORHOODS THAT HAVE BEEN UNDERSERVED AND UNDER RESEARCH. UH, SO THERE IS NO QUESTION IN MY MIND WE NEED TO DO EVEN MORE IN INVESTING IN THOSE COMMUNITIES, THOSE NEIGHBORHOODS, FIXING UP THOSE NEIGHBORHOODS. UH, THE CONSENT DECREE IN LARGE PART IS WE'LL BE ADDRESSING, UM, SANITARY SEW ARE DISCHARGES, OVERFLOWS, AND THAT PRIMARILY HAPPENS IN COMMUNITIES, UM, OF COLOR AND MAY JUST BE VERY CLEAR. SO WE NEED TO DO MORE IN INVESTING. ILLEGAL DUMPING DOES NOT OCCUR IN RIVER OAKS, OKAY? BUT IT DOES OCCUR IN CATCHMENT GARDENS AND ACRE HOMES AND THOSE TYPE OF EAST END. SO WE NEED TO ADDRESS THAT. SO WE'VE NEVER DEFUNDED AND WE WILL ALWAYS GIVE OUR, UH, POLICE OFFICERS WHAT THEY NEED, UH, NUMBER ONE, TO MAKE SURE THAT THEY PROTECT, ABLE TO PROTECT THEMSELVES AND TO CREATE A PUBLIC SAFETY, UM, TO ENHANCE PUBLIC SAFETY. SO WE HAVE DONE THAT WITH RESPECT TO THE, UH, STRUCTURAL BALANCE AND ALL OF THAT. WHEN I CAME INTO OFFICE, THE THREE CREDIT RATING AGENCIES, UH, MOODY, FITCH, AND S AND P, THEY IDENTIFIED, UH, TWO OR THREE STRUCTURAL IMBALANCES. OKAY. ONE WAS PENSIONS, THAT WAS THE MAJOR ONE. PENSIONS. WE HAVE ADDRESSED THAT THOSE REFORMS ARE IN PLACE. AND AS YOU CAN SEE, THEY'RE WORKING TO GO FROM MONTH 8.2 BILLION, UNFUNDED LIABILITY IN 2016, UH, DOWN TO 1.5 BILLION WHERE WE ARE TODAY. SO WE'VE ADDRESSED THAT. UH, ANOTHER ONE WAS EP, UH, THE POST-EMPLOYMENT BENEFITS. WE HAVE ADDRESSED THOSE REFORMS. I ONE THANK MEMBERS OF CITY COUNCIL, UH, FOR REALLY HELPING AND PULLING AND PUSHING ON, ON THAT FRONT. SO WE, WE'VE REDUCED, UH, THE UNFUNDED LIABILITY TO WHICH WOULD, WITHOUT THE REFORMS, WOULD'VE GROWN TO 30 BILLION, I'M SORRY, TO $9 BILLION OVER 30 YEARS. AND WE'VE CUT THAT IN HALF. SO IT'S A SAVINGS NOW OF ABOUT 4.6. SO IT'LL BE ABOUT, UH, 4.5 BILLION OVER THE NEXT 30 YEARS. NOW, THERE ARE SOME ADDITIONAL REFORMS THAT NEED TO BE MADE, BUT WE'VE MADE SIGNIFICANT HEADWAY, SO I'M PLEASED WITH THAT. THAT WAS ANOTHER STRUCTURAL ARGUMENT. THE THIRD STRUCTURAL IMBALANCE, UH, NOTED BY THE CREDIT RATING AGENCIES WAS THE REVENUE CAP WHERE THAT ONE REMAINS IN. OKAY. SO THAT WAS PUT IN PLACE BY THE VOTERS IN 20 AND 20 0 4, 4 [00:30:02] MODIFIED IN 2 0 6. UM, AND THAT REMAINS IN PLACE. UM, AND SO TO, UM, EITHER REMOVE IT OR TO REMOVE IT, TO JUST GO UP TO WHAT THE STATE CAP IS, WOULD BE PRUDENT, OR TO MODIFY IT OR TO PUT, TO ALLOW ADDITIONAL DOLLARS FOR PUBLIC SAFETY WOULD BE ANOTHER WAY. BUT THAT ONE STILL REMAINS. SO, BUT WHEN, SO WHEN YOU LOOK AT THIS BUDGET, UH, WE ARE, WE ARE OPERATING, I BELIEVE, IN A MORE STRUCTURALLY BALANCED FASHION WITH THE EXCEPTION OF THE REVENUE CAP. OKAY. AND THAT'S NOT UNDER MY CONTROL IN UNITED UNDER CONTROLLED THE CITY COUNCIL. SO WITH THE EXCEPTION OF THAT, THIS BUDGET IS MORE STRUCTURALLY BALANCED, UH, THAN ANY BUDGET THAT HAS BEEN PRESENTED SINCE 2001. YEAH. JUST A FEW MORE. UM, MARY, IT LOOKS LIKE ONE OF, I'M JUST GOING THROUGH THE GENERAL FUND NUMBERS. IT LOOKS LIKE ONE OF THE BIGGEST SORT OF PERCENTAGE HIKES IS THE PARKS DEPARTMENT. I THINK THEY'RE GOING FROM LIKE 67 TO $87 MILLION. UM, IS THAT PRIMARILY SORT OF THE FACILITY UPGRADES THAT YOU WERE TALKING ABOUT EARLIER? OR ARE THERE PLANS TO SORT OF BOOST THEIR WORKFORCE AS WELL? CAN YOU JUST GO INTO A LITTLE BIT ABOUT WHAT'S DRIVING THAT INCREASE? WELL, OF COURSE A PART, YOU KNOW, THEY, THEY'RE PART OF OUR MUNICIPAL EMPLOYEES, SO FACTOR THAT IN AS WELL. UH, NUMBER TWO IS THAT, UM, WHAT IS IMPORTANT, AND I THINK WHAT I'VE HEARD FROM MANY OF THE COUNCIL MEMBERS IN BOOSTING AND ENHANCING PARKS ARE CRITICALLY IMPORTANT. NOW, WE HAVE, WE HAVE BEAUTIFUL SIGNATURE PARKS, HERMAN MEMORIAL DISCOVERY GREEN, BUT WE ALSO HAVE ABOUT 350 LOCAL NEIGHBORHOOD PARKS. AND WHEN YOU MAKE SIGNIFICANT IMPROVEMENTS TO THOSE LOCAL NEIGHBORHOOD PARKS, YOU ENHANCE THOSE COMMUNITIES, THOSE NEIGHBORHOODS. AND I ALSO BELIEVE YOU MAKE OUR CITY SAFER TOO. OKAY? AND YOU ADDRESS THE CONCERNS THAT WAS JUST RAISED BY THIS GENTLEMAN. UM, CHA YEAH, YOU, YOU ADDRESS CONCERN RAISED BY JAZZ. AND THAT IS WHAT I WAS HEARING PEOPLE SAY IS, YOU KNOW, IT'S NOT ABOUT SO MUCH DEFUNDING BELIEFS, BUT INVEST IN COMMUNITIES AND NEIGHBORHOODS, AND WE ARE DOING THAT. SO THE LOVE YOUR PARKS INITIATIVE, THAT'S, THOSE ARE LOCAL NEIGHBORHOOD PARKS. THE 22 PARKS THAT ARE BEING WORKED ON RIGHT NOW BY THE PARKS BOARD AND PARKS AND REC, THOSE ARE NEIGHBORHOOD COMMUNITY PARKS, WHICH WILL ALL WORK TO ENHANCE THE QUALITY OF LIFE FOR PEOPLE, UH, LIVING IN THOSE COMMUNITIES. SO THAT HAS BEEN A PRIORITY. UM, THOSE DOLLARS ARE PUT THERE INTENTIONALLY. AND THEN JUST LIKE FOR THIS SUMMER, LEMME JUST SAY THIS, WE ARE LOOKING FOR LIFEGUARDS. OKAY? SUMMERS A PRO AND, AND IT'S HOT AND PEOPLE ARE GOING TO BE, WANT BE USING POOLS THE WORST. I'M GONNA SAY ONE OF THE, YOU KNOW, ONE OF THE WORST THINGS IS TO HAVE FUNCTIONAL POOLS AND OUR CHILDREN AND FAMILIES CAN'T UTILIZE 'EM. 'CAUSE WE DON'T HAVE LIFEGUARDS. SO WE MAY HAVE TO BOOST A LITTLE, PAY A LITTLE BIT TO GET SOME LIFEGUARDS, BUT NO PARKS AND PARKS AND AMERICA'S A PRIORITY. AND, UH, AND QUITE FRANKLY, OUR LIBRARIES AND CONTINUE TO BE PRIORITIES. SO IT CAN'T JUST, IT CAN'T JUST BE, YOU KNOW, THE THREE TOP, YOU KNOW, POLICE, FIRE, SOLID WAYS, BUT PARKS AND LIBRARIES, THEY'RE ALSO IMPORTANT. AND THEN I, I JUST MISSED THIS EARLIER. I KNOW THE LAST COUPLE YEARS WE'VE, YOU'VE DONE AN, AN EXTRA POLICE CADET CLASS TO TRY TO BOOST THEIR RANKS. IS IT, IS THERE AN EXTRA CLASS IN THIS YEAR'S BUDGET AS WELL? OR IS IT JUST THE BASE FIVE? YOU KNOW, AND, AND CHIEF FINNER CAN SPEAK TO THIS, CHIEF FINNER CAME TO ME AND SAID, MAYOR, YOU KNOW, WE, WE GOT SIX CADET CLASSES, AND LET'S SAY YOU HAVE A, LIKE A 55, 50, 55 COMING THROUGH EACH ONE OF THEM, WHAT HE THOUGHT WOULD BE BEST, INSTEAD OF EVEN HAVING SIX AND HAVING A FEWER NUMBER, HAVING FIVE AND GOING UP TO THE MAXIMUM NUMBER, LIKE 70 TO 75. SO IT IS IT, IN THE END, YOU KNOW, IT, UH, UM, THE NUMBER MAY COME OUT THE SAME, UM, BUT IT MAY BE MORE PRUDENT ON THE COST. AND THEN THOSE ADDITIONAL DOLLARS CAN BE USED IN OTHER PARTS OF, OF, WITH REGARDS TO THE LAW ENFORCEMENT. SO HIS, HIS, HIS VIEW WAS YOU CAN HAVE, YOU CAN HAVE MORE CLASSES WITH FEWER CADETS, OR YOU CAN HAVE FIVE CADET CLASSES AND FULLY FUND THOSE FIVE AND STILL GET OUT POSSIBLY EVEN MORE. SO WE, WE ARE GONNA TRY THAT. OKAY. ANYTHING DID I, DID I ASK YOU ANYTHING? EVERYTHING, COUNCIL MEMBERS, ANY ? SO THIS WILL BE MY NINTH BUDGET THAT I'LL EITHER BE CHAIR OR CO-CHAIR, AND TOMORROW WE BEGIN THE PROCESS. ON WEDNESDAY THE 11TH, WE'LL EXAMINE, WE'LL [00:35:01] HAVE THE ABILITY TO HAVE 23 OF THE BUDGETED DEPARTMENTS WITHIN THE CITY OF HOUSTON PRESENT TO COUNCIL AND TO PUBLIC. AND THEN COUNCIL WILL HAVE THE ABILITY TO ASK QUESTIONS OF THEM RELATED TO THEIR BUDGET. AND ALSO THE PUBLIC WILL WILL HAVE IT LIVE, BUT WE'LL ALSO BE SHOWING IT VIRTUAL. AND JUST REMEMBER, AS YOU LOOK AT THE BUDGET FOR THIS YEAR, WHILE THE REVENUE HAS INCREASED 3.7%, UH, THE ALLOCATIONS THAT WE HAVE ON THE EXPENSE SIDERS, 6% FOR FIRE, 4% FOR POLICE, AND 3% FOR MUNICIPAL EMPLOYEES. SO I THINK THE BUDGET IS VERY HEALTHY THIS YEAR. I THINK IT'S A COMBINATION OF US REALLY TIGHTENING OUR BELT WHEN WE SAW THE DECREASE ON THE SALES REVENUE EXPECTATION FOR THIS FISCAL YEAR COMING UP. AND THEN NOW ALL OF A SUDDEN BECAUSE OF INFLATION, WE'RE SEEING HIGHER PRICES, WHICH IS GOING TO DRIVE SALES TAX REVENUE UP A LITTLE BIT. SO I THINK WE'RE SITTING IN A REALLY GOOD SPOT. AS, UM, WE TALKED ABOUT, DYLAN MENTIONED DOUBLE THE 7.5% IN OUR FUND BALANCE. WE'RE REALLY SAVING FOR A RAINY DAY. WE HAVE A GOOD HEALTHY FUND BALANCE. UH, WE'VE MADE A SIGNIFICANT DENT IN THE, UH, OTHER POST-EMPLOYMENT BENEFITS PACKAGES, RETIREMENT PACKAGES WITH THE PENSION REFORM. SO I THINK MOVING INTO THIS ONE, I FEEL REALLY GOOD ABOUT WHERE WE ARE TODAY, UH, RELATED TO THE LAST EIGHT BUDGETS THAT I'VE ACTUALLY GONE THROUGH. AND I THINK IT'S BECAUSE OF PRUDENT EXPENSE REDUCTIONS THAT WE'VE HAD, UH, SINCE COVID HIT. AND I THINK WE'RE SEEING THE REPERCUSSIONS OF THAT, AND I THINK IT'S GONNA BE A GOOD PROCESS. JUST A REMINDER TO THE COUNCIL MEMBERS, WE'RE NOT GOING TO LOOK AT, UM, POLICY RELATED BUDGET. WE WANT NUMBERS. IF YOU HAVE AN OPPORTUNITY TO INCREASE THE BUDGET FOR A DEPARTMENT, YOU HAVE TO IDENTIFY THE FUNDING SOURCE WHERE YOU'RE GONNA PULL THAT FROM. WE'RE NOT GOING TO THROW ARPA FUNDS AT IT, UH, TO ANOTHER QUESTION THAT POPPED UP, BUT I THINK WE'RE, UH, WE'RE GONNA HAVE A LIVELY DISCUSSION. SO BEGINNING TOMORROW, UNTIL NEXT THURSDAY, WE'LL HAVE THE ABILITY TO HAVE THE PUBLIC AND COUNCIL ASK QUESTIONS OF THE DEPARTMENT AND TO REALLY GET DOWN AND ANALYZE WHERE THEY ARE WITH THEIR EXPENDITURE ASIDE, SEE WHAT WE NEED TO DO. UH, I THINK IT'S A, UH, IT'S AN EXCELLENT BUDGET. I LOOKED AT IT JUST WHEN WE RECEIVED IT, AND I THINK WE'RE IN GOOD SHAPE. I LIKE THE FACT THAT WE'RE SITTING ON A VERY HEALTHY FUND BALANCE IN LIEU OF INCREASED SALES REVENUE, THAT EVEN THE CONTROLLER'S OFFICE WHO HAD A VERY PESSIMISTIC OUTLOOK ORIGINALLY HAS CHANGED THE TONE TO THAT. AND IT'S MORE OF AN OPTIMISTIC OUTLOOK. KUDOS TO FINANCE, TO DIRECTOR EMO AND ASSISTANT DIRECT HOMES AND KNOW SURE THAT WE DO THE GOOD PROCESS OF EXAMINING EVERYBODY'S BUDGET AND MAKING SURE IT FITS WHAT WE WANT IN THE CITY. THANKS FOR ALLOWING ME THE OPPORTUNITY. LOOKING FORWARD TO IT. THAT WAS UNSCRIPTED . AND THEN, UH, AND THEN REPRESENTATIVE, ONE OF OUR KEY, UH, DEPARTMENTS, CHIEF PENNY, YOU WANNA COMMENT? WELL, THANK YOU, MAYOR. AND, UH, THIS IS, UH, POSITIVE NEWS IS WHAT I'VE HEARD HERE THIS MORNING. UM, WE ARE THE SECOND LARGEST DRAW ON THE GENERAL FUND, AND, BUT I BELIEVE THAT THE, WE GO UP FIRST TOMORROW BY THE, BY THE WAY, MAYOR, RIGHT AFTER FINANCE, RIGHT AFTER FINANCE. BUT, UH, I BELIEVE THAT THE, THAT THE BUDGET THAT WE'LL BE PRESENTING ALLOWS US TO PROVIDE THIS SERVICE THAT THIS COMMUNITY IS EXPECTING. UM, AND WE'RE, WE'RE EXCITED ABOUT THE FACT THAT WE'RE ABLE TO PROVIDE FIREFIGHTERS, AS I MENTIONED, AS WAS MENTIONED BY THE MAYOR, UH, 6% PAY RAISE STARTING, UH, NEXT FISCAL YEAR. THAT'S IN ADDITION TO THE 6% THAT WAS OFFERED LA UH, THIS CURRENT FISCAL YEAR. YEAR, AND WHICH WILL BE A TOTAL, UM, OF 18% OVER THREE FISCAL YEARS. SO THAT'S EXCITING. WE'RE LOOKING FORWARD TO THE PRESENTATION AND, UH, LOOKING FORWARD TO THE APPROVAL OF OUR BUDGET TOMORROW. ALRIGHT, UH, IN CLOSING AGAIN, LET ME, LET ME THANK, UH, DIRECTOR, FINANCIAL DIRECTOR, EMO AND ASSISTANT DIRECTOR JONES, UH, FOR THEIR LEADERSHIP. UH, IN THIS EFFORT, I REALLY, UH, WORKING ON THE BUDGET IS NEVER, IT IS NEVER AN EASY TASK AND, UH, VERY DIFFICULT. THERE ARE A LOT OF MOVING PARTS, UH, PARTS ARE ALWAYS MOVING. SO LET ME, LET ME THANK, UM, UH, THE TWO OF YOU AND YOUR, UH, YOUR TEAM, UH, FOR WORKING ON THIS. AND THEN WE LOOK FORWARD TO PRESENTING THE BUDGET TO THE COUNCIL MEMBERS AND TO A VOTE. UH, THE FIRST, THE, THE FIRST WEEK, THE FIRST WEEK IN JUNE, UNLESS, YOU KNOW, THEY WANT TO, UH, SEND A, A PROXY AND AND, UH, JUST THE VOTING WILL REMAIN OPEN BETWEEN NOW AND JUNE, THE FIRST . ALL RIGHT. THANK Y'ALL VERY MUCH. APPRECIATE IT. ALRIGHT. * This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting.