[ Budget and Fiscal Affairs on April 25, 2023.]
[00:00:02]
MORNING COUNCIL MEMBERS AND STAFF AND MEMBERS OF THE PUBLIC.MY NAME IS EDWARD POLLARD AND I AM THE DISTRICT J COUNCIL MEMBER AND VICE CHAIR OF THE CITY OF HOUSTON'S BUDGET AND FISCAL AFFAIRS COMMITTEE MAYOR PRO TIMM MARTIN IS ON CITY OF HOUSTON BUSINESS IN AUSTIN, TEXAS, TODAY TESTIFYING ON BEHALF OF THE CITY.
IN ADDITION TO ADVOCATING FOR THE LAKE HOUSTON SPILLWAY DAM IMPROVEMENT PROJECT COUNCIL MEMBERS AND STAFF, WE HAVE THREE PRESENTATIONS TODAY.
AS PER USUAL COMMITTEE RULES, WE WILL BE TAKING QUESTIONS AT THE CONCLUSION OF EACH PRESENTATION.
EACH COUNCIL MEMBER WILL HAVE TWO MINUTES TO SPEAK.
I'LL CALL THIS MEETING TO ORDER AND WOULD LIKE TO WELCOME ALL COUNCIL MEMBERS IN ATTENDANCE.
RIGHT NOW WE HAVE VICE MAYOR PRO, TIM MARTHA CASTEX TATUM, COUNCIL MEMBER MICHAEL KUBO, COUNCIL MEMBER TIFFANY THOMAS.
AND WE ALSO HAVE STAFF FROM COUNCIL MEMBER AMY PECK, STAFF FROM COUNCIL MEMBER CARLOS CISNEROS, AND ALSO STAFF FROM COUNCIL MEMBER MIKE KNOX, LETITIA PLUMMER, AND SALLY ALCORN.
IF THERE ARE ANY MEMBERS OF THE PUBLIC THAT WOULD LIKE TO PARTICIPATE IN PUBLIC COMMENT, THERE IS A SIGN IN SHEET AT THE FRONT TABLE.
DISTRICT E STAFF IS MONITORING THE PUBLIC SPEAKERS LIST.
THERE WERE NO, THERE WERE NO PUBLIC SPEAKERS THAT SIGNED UP BEFORE 3:00 PM DEADLINE YESTERDAY.
IF YOU'RE HERE IN PERSON AND WOULD LIKE TO BE ADDED TO THE PUBLIC SPEAKERS LIST, PLEASE SIGN IN ON THE LIST LOCATED ON THE DESK TO MY LEFT AND TO YOUR RIGHT, PUBLIC SPEAKERS WILL BE ADDRESSED AT THE CONCLUSION OF ALL PRESENTATIONS.
AT THIS TIME, I WANT TO WELCOME CONTROLLER CHRIS BROWN AND DIRECTOR WILL JONES TO PROVIDE THE MONTHLY FINANCIAL REPORT AND GENERAL APPROPRIATIONS.
GENTLEMEN, GOOD MORNING, MR. VICE CHAIR COUNCIL MEMBERS AND STAFF.
I'M PLEASED TO PRESENT THE MONTHLY FINANCIAL REPORT FOR THE PERIOD ENDING MARCH 31ST IN THE GENERAL FUND, THE CONTROLLER'S OFFICE IS PROJECTING AN ENDING FUND BALANCE OF 358.3 MILLION FOR FY 23.
THIS IS $44 MILLION LOWER THAN THE PROJECTION OF THE FINANCE DEPARTMENT, AND THAT DIFFERENCE IS DUE TO A 44 MILLION LOWER REVENUE PROJECTION THAN FINANCE.
BASED ON OUR CURRENT PROJECTIONS, THE FUND BALANCE WILL BE APPROXIMATELY 183 MILLION ABOVE THE CITY'S TARGET OF HOLDING SEVEN POINT HALF PERCENT IN RESERVES.
OUR REVENUE PROJECTIONS INCREASED BY 31.1 MILLION FROM THE FEBRUARY 23 REPORT, AND THAT WAS DUE TO THE FOLLOWING.
SALES TAX INCREASED BY 30 MILLION DUE TO A HIGHER ANTICIPATED RECEIPTS.
CHARGES FOR SERVICES INCREASED BY 256,000 AND THAT WAS DUE TO HIGHER FACILITY RENTAL FEES AND CERTIFIED COPY FEES.
INTEREST INCOME INCREASED BY 447,000 DUE TO HIGHER INTEREST RATES AND EXPENDITURE ESTIMATES INCREASED BY 362,000 FROM THE FY 23 REPORT, AND THAT WAS DUE TO AN INCREASE IN FUNDING FOR ROLL-OFF CONTAINERS FOR SOLID WASTE IN THE ENTERPRISE FUND.
OUR EXPENDITURES FOR THE DEDICATED DRAINAGE AND STREET RENEWAL METRO FUND DECREASED BY 273,000, AND THAT WAS DUE TO HIRING DELAYS.
IF YOU LOOK AT OUR COMMERCIAL PAPER AND BONDS, ALL OF OUR VARIABLE RATE DEBT IS WELL BELOW THE 20% THRESHOLD.
I WILL MOVE ON TO OUR QUARTERLY INVESTMENT IN SWAP REPORT.
AS OF MARCH 31ST, THE CITY HAD $6.03 BILLION INVESTED IN OUR GENERAL INVESTMENT POOL.
UH, FITCH RECENTLY RATED THIS POOL AND ASSIGNED THE HIGHEST RATING THAT OF AAA.
UH, INVESTMENTS ARE 419 MILLION HIGHER THAN LAST YEAR, AND THIS IS PRIMARILY ATTRIBUTABLE TO THE TEXAS WATER DEVELOPMENT BOARD LOAN AND INCREASE IN FUNDING FROM CAPITAL PROJECT FUND, HIGHER PROPERTY TAX RECEIPTS, AND ALSO COMMERCIAL PAPER ISSUANCE.
AS OF MARCH 31ST, 2023, THE GENERAL INVESTMENT POOL WAS YIELDING 2.368%, WHICH IS UP FROM THE 1.787% YIELD IN THE PRIOR QUARTER.
MOVING ON TO OUR QUARTERLY SWAP REPORT, UH, THE CITY HAD A NET PAID FOR THE FISCAL YEAR ENDED MARCH 31ST, 2023 FROM ITS SWAPS OF $1.4 MILLION.
THE FAIR VALUE FOR THE SWAPS AS OF MARCH 31ST, 2023 WAS NEGATIVE 120 MILLION, AND THAT'S APPROXIMATELY 21 MILLION MORE THAN LAST QUARTER.
SO UNFORTUNATELY, BECAUSE OF THE CURRENT INTEREST RATE ENVIRONMENT AND HAVING A INVERTED YIELD CURVE, UH, WE ARE SEEING BOTH, UH, INCREASE IN THE NET PAYING AMOUNT OF 1.4 MILLION AND ALSO, UH, SEEING AN INCREASE OF 21 MILLION IN OUR NEGATIVE FAIR VALUE.
SO HOPEFULLY AS THE YIELD CURVE FLATTENS AND THINGS RETURN TO NORMAL, WE WILL SEE THOSE NUMBERS CONTINUE TO IMPROVE.
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DIRECTOR.ALRIGHT, GOOD MORNING, VICE CHAIR, COUNCIL AND STAFF.
UH, UH, THIS IS A NINE PLUS THREE FINANCIAL REPORT FOR THE PERIOD ENDING MARCH 31ST, 2023.
PROJECTIONS ARE BASED ON NINE MONTHS OF ACTUAL RESULTS AND THREE MONTHS OF PROJECTIONS IN THE GENERAL FUND.
OUR REVENUE PROJECTION IS 83.1 MILLION HIGHER THAN THE ADOPTED BUDGET, AND 30.5 MILLION HIGHER THAN LAST MONTH.
THE VARIANCE FROM PRIOR MONTHS PROJECTIONS, PRIMARILY DUE TO A 30.4 MILLION INCREASE IN OUR SALES TAX.
OUR EXPENDITURE PROJECTION IS 29.3 MILLION HIGHER THAN THE ADOPTED BUDGET AND 362,000 HIGHER THAN LAST MONTH.
THE VARIANCE FROM PRIOR MONTH PROJECTION IS DUE TO INCREASE IN SOLID WASTE DEPARTMENT FOR ROLL OFF CONTAINERS PURCHASED.
UH, WE ARE CURRENTLY PROJECTING THE ENDING FUND BALANCE OF 402.3 MILLION, WHICH IS 30.2 MILLION HIGHER THAN THE PRIOR MONTH, AND 17.2% OF ESTIMATED EXPENDITURES, LESS DEBT SER DEBT SERVICE.
UM, THE FUND BALANCE WILL BE 226.9 MILLION ABOVE THE TARGETED 7.5% OF EXPENDITURES, LESS DEBT SERVICE.
UM, NO CHANGES ON THE ENTERPRISE FUNDS.
THERE'S A COUPLE OF CHANGES IN SPECIAL FUNDS AND CABLE TV EXPENDITURES, DECREASED BY 1.7 MILLION, MAINLY DUE TO DELAYS IN EQUIPMENT PURCHASES AND THE ESSENTIAL PUBLIC HEALTH SERVICE FUND REVENUES INCREASED BY 5.2 MILLION DUE TO HIGHER THAN ANTICIPATED REIMBURSEMENT, UH, FOR PUBLIC HEALTH PROVIDER CHARITY CARE PROGRAM.
AND THE, UH, SPECIAL WASTE, UH, FUND EXPENDITURES DECREASED BY 578,000 DUE TO SAVINGS AND PERSONNEL.
UH, SWIMMING POOL SAFETY FUND EXPENDITURES DECREASED BY 1 MILLION DUE TO SAVINGS AND PERSONNEL.
UH, MOVING ON TO THE HOUSTON ECONOMY UPDATES, UH, FOR ENERGY, THE AVERAGE OIL PRICE OF $73.28 FOR THE MONTH OF MARCH WAS 4.6% LOWER THAN THE POWER MONTHS AVERAGE OF 76.83.
COMPARING FROM THE SAME PERIOD OF LAST YEAR, THE PRICE HAS DECREASED BY 32.5%.
ACCORDING TO THE BUREAU OF LABOR STATISTICS, THE PRELIMINARY TOTAL KNOWN FORM EMPLOYMENT IN THE HOUSTON METROPOLITAN AREA STOOD AT 3.4 MILLION IN FEBRUARY, 2023.
UP APPROXIMATELY 1% COMPARED TO LAST MONTH WHEN COMPARED TO THE SAME PERIOD LAST YEAR.
NON-FARM EMPLOYMENT IS UP 8.3%.
THE PRELIMINARY UNEMPLOYMENT RATE FOR THE MONTH OF FEBRUARY WAS 4.8% COMPARED TO PRIOR MONTH AT 4.5%.
LOOKING AT THE HOME SALES, THE LATEST REPORT, UH, PREPARED BY THE HOUSTON ASSOCIATION OF REALTORS FOR THE MONTH OF MARCH SHOWS A TOTAL SINGLE FAMILY HOME SALES OF, UH, 7,000 9 0 7.
WERE 18.4% LOWER COMPARED TO MARCH OF 2000, UH, 22 AT 9,693.
AND ACTUALLY, THANK YOU VERY MUCH.
THAT COMPLETES MY REPORT AND I WOULD LIKE TO JUST REMIND COUNSEL, UH, TOMORROW ON THE AGENDA WILL BE THE GENERAL APPROPRIATIONS ORDINANCE, UH, WHICH IS ESSENTIALLY THE TRUE OF OF OUR, UH, FISCAL YEAR PROJECTIONS, EVERYTHING WE'VE BEEN REPORTING IN THE MONTHLY FINANCIAL REPORT, THAT THAT ORDINANCE WILL ACTUALLY ALLOW US TO ADJUST THE BUDGET BASED ON THAT.
IT'LL BE CERTIFIED BY THE CONTROLLER'S OFFICE.
SO ANY QUESTIONS YOU HAVE ON THAT, PLEASE LET ME KNOW.
AND, UH, FIRST QUESTION IS, UH, FOR EITHER ONE OF YOU, WHAT IS OUR AVERAGE, UH, SALES TAX REVENUES, UH, THAT WE'VE BEEN SEEING EACH MONTH, AND THEN THE SECOND FOLLOW UP? UH, IS THERE ANYTHING THAT WE CAN SPEAK OF THAT INDICATES, WHILE WE HAD SUCH A, A BIG INCREASE IN SALES TAX FOR THIS, FOR THIS MONTH? UM, JUST GOING FIRST, LOOKING AT THE AVERAGE INCREASE OVER PRIOR YEAR, WE'RE CLOSE TO 11% AHEAD OF WHERE WE WERE LAST YEAR, UM, WHICH IS STILL TREMENDOUS GIVEN THAT, YOU KNOW, WE ENDED LAST YEAR DOUBLE DIGITS AHEAD.
SO SALES TAX IS STILL OUTPACING, UM, ANYONE'S EXPECTATIONS.
UM, SO YEAH, WE DOUBLE DIGIT AHEAD OF WHERE WE WERE LAST YEAR, SO THAT'S WHY YOU JUST, CONTROLLERS WENT UP 30 MILLION.
SO WE'RE RIGHT NOW AT, UH, 892 MILLION.
UM, SO, AND IT'S STILL, WE STILL HAVEN'T REC NEXT MONTH WILL BE THE MARCH RECEIPTS, WHICH WILL INCLUDE SOME OF THE FINAL FOUR ACTIVITY.
UM, SO, UH, SALES TAX IS STILL GOING STRONG.
UM, AND WHAT WAS YOUR, WHAT WAS THE OTHER QUESTION? UH, YOU'RE, YOU'RE SPEAKING TO IT.
UH, WHAT, WHAT COULD BE MAYBE IDENTIFIED AS A REASON FOR THAT THAT YOU ALL HAVE SEEN? YEAH.
AND THAT, THAT'S, IT'S A DIFFICULT QUESTION 'CAUSE THERE'S PROBABLY SEVERAL FACTORS.
UM, THERE WERE STILL A LOT OF FEDERAL DOLLARS OUT IN THE ECONOMY.
WHO KNOWS HOW MUCH OF THAT IS STILL LEFT, THAT STILL ENCOURAGED, UH, YOU KNOW, CITIZENS TO SPEND.
UM, WE KNOW AT SOME POINT THAT'S GONNA RUN OUT, INFLATION IS GONNA STABILIZE.
UM, WE, WE ARE STILL SURPRISING THAT EVEN WITH PRICES GOING UP, PEOPLE ARE STILL COMFORTABLE SPENDING.
IF YOU SAW LIKE THE LOOKING AT THE EMPLOYMENT, EMPLOYMENT HASN'T REALLY DECREASED.
IT'S STILL GROWING AND UNEMPLOYMENT IS STAYING PRETTY STEADY.
SO PEOPLE ARE STILL WORKING, THEY'RE STILL SPENDING, UM, SO IT'S JUST, IT'S, IT'S, IT'S DIFFICULT TO TELL HOW LONG WE CAN MAINTAIN THAT LEVEL OF DOUBLE DIGIT GROWTH.
BUT RIGHT NOW, GIVEN THE ECONOMY, PEOPLE ARE STILL COMFORTABLE SPENDING.
[00:10:01]
IT'S DIFFICULT TO SAY HOW LONG THAT WILL LAST.WANNA CHIME IN AT ALL, CONTROLLER? YEAH, I WOULD JUST ECHO THOSE SENTIMENTS FROM, UH, DIRECTOR JONES.
UM, WE'RE, WE'RE SEEING OVER $70 MILLION ON AVERAGE A MONTH IN RECEIPTS FROM SALES TAX.
UH, IF YOU LOOK HISTORICALLY IN THE PAST, WE'VE SEEN THAT NUMBER CLOSER TO 60 MILLION IN THE DEPTHS OF COVID.
UM, RIGHT NOW OUR OFFICE IS TRACKING, UH, ABOUT A 10.6% INCREASE IN SALES TAX YEAR OVER YEAR.
SO SALES TAX IS EXTREMELY ROBUST.
I KNOW, UH, DIRECTOR JONES AND I SOMETIMES, UH, PINCH OURSELVES AND SAY, IS THIS REAL? UM, YOU KNOW, I DID, UH, HAVE A CHANCE TO SPEAK AT THE, UH, TEXAS BOMB BUYER CONFERENCE LAST WEEK AND DISCUSSED, UH, A LOT OF THESE DIFFERENT REVENUE ISSUES.
AND, AND I WAS, UH, THE SPEAKER RIGHT AFTER, UH, UH, TEXAS COMPTROLLER GLENN HAGAR, AND HE SAID, UH, YOU KNOW, THE STATE IS IN A SIMILAR POSITION.
THEY'RE RECEIVING, UH, RECORD AMOUNTS OF, UH, REVENUE, BUT HE, HE LIKENED IT TO A ONCE IN A LIFETIME EVENT.
AND I THINK, UM, YOU KNOW, THIS IS A, A UNIQUE ANOMALY IN THE SENSE THAT WE'VE SEEN SO MUCH FEDERAL MONEY AS DIRECTOR JONES HAS, HAS MENTIONED PREVIOUSLY THAT'S BEEN PUMPED INTO THE, UH, ECONOMY, UH, COUPLED WITH, UH, INFLATION.
AND I THINK THAT WAS SOMETHING THAT MOST OF US DIDN'T ANTICIPATE.
USUALLY WHEN PRICES RISE, DEMAND FALLS BECAUSE PEOPLE DON'T WANNA PAY MORE FOR THINGS.
BUT PEOPLE ARE CONTINUING, UH, TO BUY, UH, AS WE SEE IN EVIDENCE FROM THE INCREASE IN, IN SALES TAX, I THINK IN PART TO INFLATION.
AND FINALLY, YOU KNOW, OIL PRICES HAVE ACTUALLY, UM, REMAINED QUITE, UH, STABLE.
UH, I MEAN, WE'RE STILL SEEING, UH, YOU KNOW, OIL PRICES HOVERING AROUND THE HIGH SEVENTIES, UH, $80 BARREL.
UH, SO THAT IS ALSO, I THINK, CONTRIBUTING TO OUR LOCAL STRENGTH IN THE ECONOMY.
SO, UH, THE ONLY THING I WOULD SAY, AND I I I THINK WE'VE TALKED ABOUT THIS, UH, BEFORE AT THIS, UH, MEETING AND AT AT COUNCIL MEETING, IS I DON'T ANTICIPATE US TO CONTINUE TO SEE THIS INCREASE IN SALES TAX AT SOME POINT, WHETHER THAT'S BECAUSE OF RECESSION OR BECAUSE ALL THE FEDERAL MONEY FINALLY BURNS OUTTA THE SYSTEM.
UM, YOU KNOW, WE DON'T THINK THAT THIS IS GONNA CONTINUE.
SO I WOULD SAY TAKE THOSE, UH, UH, WORDS AS YOU GO THROUGH THE BUDGET DELIBERATIONS, YOU KNOW, FOR THIS YEAR, UH, PROBABLY THINGS ARE GOOD, BUT, YOU KNOW, MOVING OUT INTO THE FUTURE, UH, I DON'T ANTICIPATE US SEEING ANOTHER 10.6% INCREASE IN SALES TAX NEXT YEAR.
UH, TURN TO COUNCIL MEMBERS FIRST IN THE QUEUE IS COUNCIL MEMBER MICHAEL KUBO.
UM, DIRECTOR JONES, DO WE HAVE THE ABILITY TO SEE, UH, ON OPEN FINANCE, HOW MANY PEOPLE ARE, UH, ARE USING THAT, UH, THAT WEBSITE? UH, I CAN CHECK WITH IT.
THEY SHOULD BE ABLE TO PULL THE TRAFFIC ON THAT WEBSITE.
YEAH, I'D LIKE TO, I'D LIKE TO KNOW WHAT THE TRAFFIC IS ON IT AND, AND ALSO, UH, UH, UM, I, I APPRECIATE SEEING, UH, ITEM 17 ON THE AGENDA.
IT, UH, IT KIND OF GIVES US SOME, UH, SOME IDEAS ABOUT, UH, ABOUT WHERE SOME OF THIS MONEY I WAS, I WAS SURPRISED TO SEE THAT THE CITY COUNCIL IN THE AMOUNT OF 3.3 MILLION TO REFLECT PRIOR YEAR COUNCIL DISTRICT SERVICE FUND ROLLOVER.
I, I WOULD'VE FIGURED THEY'D ALREADY USED THAT
SO THEY HADN'T USED IT YET, RIGHT? YEAH.
WELL, YEAH, THAT WAS WHAT THEY, I KNOW THAT'S NOT HOW THAT GOES.
WELL, WELL, I'LL LET YOU EXPLAIN THAT TO ME.
YEAH, SO, RIGHT, THEY AIN'T GOT TO THE PROJECT.
SO WITHIN THE YEAR, IF THEY'RE NOT ABLE TO COMPLETE THE PROJECTS, WE DO ALLOW THAT FUNDING TO ROLL FORWARD.
SO IT'S NOT THAT IT'S NOT BEING USED, IT'S JUST THE, THE, THE TIME IT TAKES TO, YOU KNOW, FROM START TO FINISH TO DO A PROJECT.
SO ONCE A PROJECT STARTS, WE WANNA MAKE SURE THAT FUNDING ROLLS OVER.
WELL, WELL, LET'S MAKE SURE THAT THE, ALL THE DISTRICT COUNCIL MEMBERS KNOW THAT I WAS THE ONLY AT LARGE COUNCIL MEMBER.
THAT VOTED FOR IT, CLEAN IT UP, CLEANED IT UP, SO THAT VOTED FOR YOU OUGHT TO HAVE THAT MONEY, CLEAN IT UP,
AND I, WHEN THEY, COUNCILMAN BRADFORD BROUGHT THAT FORWARD YEARS AGO, HE WAS AN AT LARGE COUNCIL MEMBER LIKE I WAS, BUT WE, WE REALLY BELIEVE THAT WAS THE RIGHT THING FOR THE DISTRICTS.
UH, ALSO, UM, UH, CONTROLLER BROWN, WILL YOU BE HAVING, UH, SOME SUGGESTIONS ON, ON WHAT YOU MIGHT WANNA SEE AS AN INCREASE IN YOUR BUDGET FOR A BUDGET AMENDMENT? YEAH, WE'VE BEEN TALKING ABOUT THAT INTERNALLY.
I, I THINK, UM, WE'VE GOT SOME METRICS THAT WE'VE, UH, PUT TOGETHER ON COMPARABLE TO OTHER CITIES, UH, AND HOUSTON.
UH, AND WE'RE SPECIFICALLY TALKING ABOUT INCREASING OUR AUDIT BUDGET TO INCREASE THE NUMBER OF AUDITORS.
UM, YOU KNOW, AGAIN, THE CHALLENGE, YOU KNOW, TO BE QUITE FRANK IS THAT, UH, WHILE WE HAVE A, UM, YOU KNOW, PROBABLY RECORDS AMOUNT OF, OF MONEY NOW, UH, IN THE FUTURE, UH, THAT MIGHT NOT BE THE CASE WHEN THE FEDERAL MONEY BURNS OFF.
SO WE'RE TRYING TO BE, UM, YOU KNOW, COGNIZANT OF THE FACT OF THE, YOU KNOW, FUTURE BUDGET.
SO WE DON'T LEAVE, FOR EXAMPLE, UH, RAISE THE BUDGET UP QUITE SUBSTANTIALLY NOW, AND THEN WHOEVER THE NEXT CONTROLLER IS IS, YOU
[00:15:01]
KNOW, HAVING TO MAKE SOME TOUGH CHOICES DOWN THE ROAD.SO, WE'LL, WE'LL BE, UH, HAPPY TO DISCUSS THAT IN MORE DETAIL.
I WANT TO ACKNOWLEDGE COUNCIL MEMBER TARSA JACKSON IS IN ATTENDANCE WITH THIS AS WELL.
UH, NEXT IN THE QUEUE IS COUNCIL MEMBER TIFFANY THOMAS.
UH, AND FORGIVE ME, UH, CONTROLLER IN MY HASTE TO MAKE IT HERE ON TIME.
I FORGOT MY BOOKLET, BUT YOU DID, I WANNA POINT TO YOUR COMMENTS ABOUT THE PROPERTY TAX RECEIPTS.
UM, UH, YOU SAID THAT WE'RE, UH, WE ARE RECEIVING, UM, HIGHER RECEIPTS THAN NORMAL.
CAN YOU GIVE THAT AVERAGE OF, UH, THE PROPERTY TAX RECEIPTS AND WHAT WE'VE, UM, HISTORICALLY DONE IN THE PAST? AND THEN I HAVE A QUESTION FOR THE DIRECTOR AS WELL.
UH, WE TALKED PREVIOUSLY ABOUT SALES TAX THAT WAS 10.6%, UH, INCREASE, UH, ON THE PROPERTY TAX.
UM, YOU KNOW, WE'RE LIMITED BY THE PROP ONE CALCULATION, BUT, UH, BECAUSE WE'RE SEEING SUCH AN INCREASE IN INFLATION IN CPI, UH, WE'RE ACTUALLY GETTING, I THINK, INTO THE UPPER BOUND OF THE 4.5% MAXIMUM.
SO I THINK ONCE WE DO THAT CALCULATION, WE SHOULD SEE SOMETHING CLOSER TO THE, UH, 4%, YOU KNOW, FOR FIRST TIME IN A LONG TIME WE'LL SEE A 4% INCREASE.
BUT UNFORTUNATELY, WE ALSO HAVE SB TWO.
UH, SO WE HAVE THESE TWO DIFFERENT, UH, MECHANISMS THAT ARE, UH, RESTRICTING OUR, OUR PROPERTY TAX REVENUE.
UM, YOU KNOW, WE SEE APPRAISALS THAT, UH, AGAIN, BECAUSE THE VALUE OF GOODS ARE GOING UP AND PRICES OF HOMES HAVE CONTINUED TO GO UP, UM, YOU KNOW, WE'RE SEEING THE INCREASING INCREASES SPECIFICALLY IN RESIDENTIAL PROPERTY, UH, PROBABLY MORE THAN DOUBLE WHAT WE'RE SEEING ACTUAL RECEIPTS FROM PROP ONE.
SO WE, WE ARE RESTRICTED FROM THAT.
UM, BUT OVERALL, I THINK WE'LL, WE'LL PROBABLY SEE AROUND A 4% INCREASE.
AND, UH, DIRECTOR, UM, UH, SPEAKING TO THE EMPLOYMENT TRENDS, UM, ARE YOU, DO YOU HAVE THE INFORMATION IF THESE ARE ACTUALLY CITY OF HOUSTON JOBS OR CORPORATIONS THAT ARE LOCATED WITHIN THE CITY? AND WE'RE COUNTING THOSE HEADS, I'M INTERESTED IN LIKE, NOT JUST THE REGION, BUT THE JOBS THAT WE'RE ACTUALLY CREATING WITHIN THE CITY LIMITS.
UM, DO THESE NUMBERS SPEAK TO THAT? YEAH, IT SHOULD BE ALL SECTORS THROUGHOUT THE METROPOLITAN AREA, YOU KNOW, FROM RETAIL TO, UM, THE REGION, NOT JUST THE CITY VICE MAYOR, PRO TEM.
UH, MY QUESTION IS ON, UM, PAGE ONE, UH, CONTROLLER BROWN.
IT SAYS, THE METRO FUNDS DECREASED BY 273,000 DUE TO HIRING DELAYS.
CAN YOU EXPLAIN WHY THE DELAY WOULD, YOU KNOW, I THINK, UM, THEY'RE DEALING WITH THE SAME ISSUE THAT WE'RE DEALING WITH IS THAT, UH, YOU KNOW, WAGE INFLATION, UH, IT'S DIFFICULT TO HIRE PEOPLE.
THE, THE PRICES, UH, SALARIES HAVE GONE UP AND, YOU KNOW, AND ONE OF THE ISSUES WITH, IN OUR AUDIT DIVISION, WE'RE MAKING OFFERS TO PEOPLE AND, UH, THEY'RE SHOPPING THAT TO THE PRIVATE SECTOR, AND THEN THEY'RE USING, I THINK, OUR OFFERS IN SOME INSTANCES AS A BASELINE, UH, TO GET A BETTER OFFER, UH, IN THE PRIVATE SECTOR.
SO I THINK IT MIGHT BE A SIMILAR ISSUE.
I THINK THAT WOULD BE A, UH, UM, QUESTION FOR DIRECTOR HADDOCK SPECIFICALLY, BUT MAYBE DIRECTOR JONES CAN ANSWER.
I THINK IT'S PROBABLY DELAYS BECAUSE OF, OF COMPETITIVE MARKET.
NO, WE ARE CERTAINLY NOT ACROSS THE CITY.
UM, LIKE I SAID, THE, THE EMPLOYMENT MARKET IS STILL, STILL VERY STRONG, UM, AND EXTREMELY COMPETITIVE.
UM, EVEN LIKE WITHIN MY OWN DEPARTMENT, JUST AS CONTROLLER SAID, IT IS VERY CHALLENGING TO GET PEOPLE IN.
THEY HAVE SO MANY OPTIONS NOW.
UM, AND IT'S JUST TAKEN A WHILE TO TRY AND FILL SOME OF THOSE POSITIONS, BUT YOU'LL SEE IT THROUGHOUT THE CITY.
AND THEN MY OTHER QUESTION IS, UM, I NOTICED THAT EVERY MONTH WHEN WE GET THE REPORT, UH, OUR RATINGS ARE THE BEST AND WE HAVE REALLY GOOD RATINGS.
UM, DO THESE ORGANIZATIONS WHO ARE RATING US, UM, OUR FINANCES, DO THEY TAKE INTO CONSIDERATION THE USE OF OUR ARPA FUNDS AND WHAT WE ARE ANTICIPATING? OR ARE THEY ONLY LOOKING AT WHAT IS CURRENTLY HAPPENING? WELL, I THINK THEY TAKE THE WHOLE PICTURE INTO CONSIDERATION.
I THINK, UM, YOU KNOW, ABSENT OF THE FEDERAL MONEY, WE HAVE SEEN QUITE A SUBSTANTIAL INCREASE IN, IN SALES TAX AND PROPERTY TAX AND OTHER REVENUES.
SO THAT'S, YOU KNOW, ONLY BOLSTERING, UH, THE CURRENT, UM, FINANCIAL SITUATION THAT WE'RE IN RIGHT NOW.
AND I THINK, YOU KNOW, THE RATING AGENCIES REFLECT THAT, UM, OVERALL, UH, YOU KNOW, AGAIN, THE, UH, THE FEDERAL MONEY WILL BURN OFF AT SOME POINT.
UM, SO AS THAT HAPPENS, IF WE'RE NOT MANAGING THAT PROPERLY FROM A BUDGETARY PERSPECTIVE, AND, YOU KNOW, ONE YEAR IT JUST EXPIRES AND THEN WE HAVE A, A BIG DROP OFF, I WOULD EXPECT THE RATING AGENCIES TO COME BACK AND WE VISIT WITH THEM, YOU KNOW, PERIODICALLY THEY WOULD COME BACK AND, AND MAYBE, UH, REEVALUATE BASED ON THAT FUTURE SITUATION.
SO THEY'RE DEFINITELY TAKING INTO CONSIDERATION THE FEDERAL FUNDS AND, UH, TOTAL REVENUE THAT WE'RE RECEIVING.
[00:20:01]
OKAY.COUNCIL MEMBER KUBA, THANK YOU VERY MUCH.
UH, DO YOU HAVE, UH, A, UM, A KNOWLEDGE OF HOW MANY PEOPLE ARE CONTESTING THEIR, THEIR TAXES, THAT THAT MIGHT CREATE A PROBLEM FOR US, UH, WITH OUR TAX? YOU KNOW, EVERY YEAR THIS HAPPENS, ESPECIALLY NOW, IF IT'S A HOMEOWNER, IT'S NOT A BIG DEAL NORMALLY, BUT, BUT WHEN YOU HAVE A BUSINESS WHERE THERE, THERE'S $20 MILLION IN TAXES AND THEY'RE CONTESTING IT, UH, DO, DO YOU HAVE, DO WE KEEP TRACK OF THAT? EITHER ONE OF YOU IS FINE.
WELL, I, I KNOW WE HAVE INCREASED THE LINES OF COMMUNICATION BETWEEN THE HARRIS COUNTY APPRAISAL DISTRICT.
WE, UH, AS YOU ALL RECALL IN THE PAST, HAD A PRETTY SUBSTANTIAL HIT ONE YEAR, AROUND 16 MILLION.
AND THAT WAS PRIMARILY DUE TO COMMERCIAL REAL ESTATE.
AND MOST OF THESE LARGE PROPERTY OWNERS, WHICH ARE, YOU KNOW, THESE LARGE OFFICE BUILDING, UH, OWNERS, THEY CONTESTED THEIR TAXES AND THEY WERE ABLE TO GET A PRETTY SUBSTANTIAL, UH, DISCOUNT.
AND THAT IN TURN, AFFECTED US AS A TOTAL, UH, PROPERTY TAX REVENUE.
UM, I KNOW WE'VE PUT SOME, UM, PROCEDURES IN PLACE TO TRY AND GET SOME MORE UPDATES.
I DON'T SPECIFICALLY KNOW THE NUMBER OF PEOPLE THAT HAVE CONTESTED, BUT I, I'M SURE WE COULD REACH OUT TO THE HARRIS COUNTY APPRAISAL DISTRICT AND TRY AND GET SOME DATA IF THEY WOULD BE WILLING TO SHARE THOSE SPECIFICS.
THE OTHER QUESTION I HAD WAS THE SUPREME COURT, UH, AFTER ABOUT 18 TO 20 YEARS, UH, SAID THAT THEY SENT THE CASES BACK ON THE DUELING PROPOSITIONS DURING THE BILL WHITE ADMINISTRATION.
THEY SENT IT BACK TO THE TRIAL COURT.
UH, HOW, HOW MIGHT THIS AFFECT US IN THE FUTURE AS FAR AS THE REVENUE CAP, UH, ON PROPERTY TAX? WELL, BOTH DIRECTOR JONES AND I WERE AROUND, UH, WHEN THOSE WERE BEING IMPLEMENTED, SO I REMEMBER ALL TOO WELL, YOU KNOW, THE PROP, UM, UH, PROP ONE AND PROP TWO, UH, WERE DUELING IN THE SENSE OF ONE SIMPLE DIFFERENCE.
UM, THAT ONE, UH, CAPPED ALL OF THE ENTERPRISE FUNDS ALONG WITH THE GENERAL FUND.
AND AT THE TIME, MAYOR WHITE, UM, YOU KNOW, PUT A COMPETING, UH, PROPERTY, ONE PROP, ONE CAP, UH, AND THE PROP TWO INCLUDED THE ENTERPRISE FUNDS.
PROP ONE ESSENTIALLY WAS ONLY FOR THE GENERAL FUND, AND THAT'S THE ONE THAT WE OPERATE IN TODAY.
AND THAT WAS MERELY BECAUSE WE GOT A HIGHER VOTING PERCENTAGE AROUND 65% VERSUS THE PROP TWO.
UM, YEAH, THERE IS A JUDGE THAT HAS RECENTLY, UH, RULED THAT THERE MAY BE SOME ISSUE WITH THE, UH, MAJORITY DECISION ABOUT PROP ONE, GETTING MORE VOTES.
UH, THE EFFECT WOULD BE QUITE SUBSTANTIAL.
UM, WE WOULD HAVE TO BASICALLY LIMIT, UH, THE AMOUNT OF REVENUE TO OUR AIRPORTS, OUR, UH, CONVENTION ENTERTAINMENT, HOUSTON FIRST, AND OUR COMBINED UTILITY SYSTEMS. SO, UM, WE HAVEN'T DONE ANY CALCULATIONS AROUND THOSE NUMBERS, BUT IF YOU LOOK AT, UH, HOW MUCH MONEY AND PROPERTY TAX REVENUE WE'VE, WE'VE GONE, UH, IN THE GENERAL FUND, UH, IT'S A LOT OF MONEY OVER THE YEARS.
SO, UH, I CAN'T ANSWER THE EXACT NUMBER AS TO THE EFFECT, BUT I THINK IT, IT WOULD BE SUBSTANTIAL.
AND I WOULD, YOU KNOW, REALLY CAUTION, UM, THE PEOPLE THAT ARE INVOLVED IN THAT BECAUSE THERE'S NOT REALLY A, A SOURCE OF MONEY THAT WOULD FUND THESE THINGS.
IF FOR SOME REASON WE HAD TO REDUCE THE BUDGET SUBSTANTIALLY OVERNIGHT DUE TO A LEGAL, UH, CHALLENGE OR A LEGAL RULING, WHEN WILL WE FIND OUT ABOUT, WELL, IT'S GONNA GO BACK TO THE TRIAL COURT, IS WHAT THEY SAID.
SO, SO, AND OF COURSE, THAT JUDGE IS PROBABLY GONE MM-HMM
THAT WAS INITIALLY THERE, SO NOW IT'S GONNA GO TO, TO A DISTRICT COURT HERE IN HOUSTON, I'M ASSUMING, OR HARRIS COUNTY.
I, I'D REFER THAT TO, UM, UH, OUR, UH, CITY ATTORNEY, UH, MARTIN MICHELLE'S OFFICE, BECAUSE I, I DON'T WANNA SPEAK OUT OF TURN, BUT, BUT I CAN TELL YOU FROM A FINANCIAL PERSPECTIVE, AND HAVING DEALT WITH THAT BACK IN, UH, OH FIVE, THAT, UM, YOU KNOW, BACK THEN IT WAS GONNA BE RESTRICTIVE.
AND THEN IF YOU LOOK AT THE AMOUNT OF TIME, AND IF YOU HAD TO RETROACTIVELY APPLY THAT, IT, IT WOULD BE, UH, SUBSTANTIAL, UH, UH, SUBSTANTIAL FINANCIAL BURDEN FOR OUR ENTERPRISE FUNDS.
WELL, I'M LOOKING FORWARD TO HIS RESPONSE.
YEAH, AND I WAS JUST GONNA ADD, YEAH, SO THE, THE SUPREME COURT OPINION DOES JUST SEND IT BACK TO THE TRIAL COURT.
UM, IT WOULD RIGHT NOW WOULD BE PRETTY MUCH IMPOSSIBLE TO TRY AND CALCULATE WHAT THE POTENTIAL IMPACT WOULD BE.
SO THERE'S NO FINANCIAL ANALYSIS WE CAN DO RIGHT NOW TO SAY, THIS IS WHAT IT'S GONNA COST THE CITY.
UM, BUT AGAIN, RIGHT NOW WE'RE JUST LOOKING AT SENDING IT BACK TO THE TRIAL COURT FOR THEM TO TAKE ANOTHER LOOK AT, UM, WHERE THEY, YOU KNOW, THE TWO INTERSECT OR, OR IS PROP TWO STILL, UH, YOU KNOW, YOU KNOW, VALID OR, SO THERE'S NO FINANCIAL IMPACT FOR US TO BE ABLE TO CALCULATE FOR YOU RIGHT NOW FOR THAT.
LET ME WELCOME, UH, COUNCIL MEMBER AMY PECK FOR BEING IN ATTENDANCE IN CHAMBERS, UH, CONTROLLER, WHAT'S YOUR PERSPECTIVE ON WHERE THE CITY STANDS FINANCIALLY AFTER THE, UM, SUPREME COURT CAME BACK WITH ITS RULINGS
[00:25:01]
WITH THE FIREFIGHTER SUITS? YEAH, THAT'S A GREAT QUESTION.WELL, I THINK, YOU KNOW, WE WERE ALL VERY CONCERNED ABOUT THE POTENTIAL COSTS ASSOCIATED WITH, UH, PAY PARITY.
UM, YOU KNOW, IT'S, IT'S A, UM, IT'S A GOOD RULING, I THINK, OVERALL FOR THE CITY, BUT IT DOESN'T, YOU KNOW, CLOSE THE DOOR ON THIS ISSUE.
UM, WE STILL HAVE, UH, SOME PREVAILING WAGE ISSUES THAT HAVE TO BE ADDRESSED.
UH, AND ESSENTIALLY WE NEED, AS I'VE SAID, UH, FOR MANY YEARS, UH, YOU KNOW, THE PATH FORWARD IS THROUGH A COLLECTIVE BARGAINING AGREEMENT.
SO WE STILL NEED TO SIT DOWN AT THE TABLE AND WE NEED TO NEGOTIATE WITH FIRE AND HAVE A PACKAGE AND, YOU KNOW, PUT A COST ON THAT AND GET, UH, FIRE TO AGREE TO THAT.
UM, SO I, I WOULD SAY, UH, IF YOU'RE, YOU KNOW, LOOKING AT THE POTENTIAL COST, AND, AND WE TALKED ABOUT THIS IN THE PAST OF WHAT, YOU KNOW, THE TOTAL PACKAGE OF PROP B IMPLEMENTATION WOULD BE, AND YOU KNOW, IT, IT WAS SUBSTANTIAL.
UM, I THINK THAT, UH, NOT HAVING THE PAY PARITY PIECE OF IT PROBABLY FINANCIALLY HELPS THE CITY, BUT IT'S, IT'S, IT'S NOT A DONE DEAL.
WE STILL HAVE TO NEGOTIATE, UH, CBA WITH, WITH FIRE.
SO, UM, YOU KNOW, I WOULD ENCOURAGE THE ADMINISTRATION TO TRY AND WORK TOWARDS THAT END AND, UH, YOU KNOW, LET'S, UH, PUT THIS TO BED PROVERBIALLY, AND, AND WE NEED TO KNOW WHAT THOSE COSTS ARE SO WE CAN BUDGET AROUND THEM.
BECAUSE HAVING THESE, YOU KNOW, LARGE POTENTIAL LIABILITIES LOOMING, UM, IT'S VERY HARD FOR ALL OF US TO, YOU KNOW, PROJECT INTO THE FUTURE WHAT OUR COSTS ARE GONNA BE.
UH, I SEE NO OTHER COUNCIL MEMBERS IN QUEUE.
UM, CONTROLLER BROWN, YOU'VE ALREADY TOUCHED ON THE QUARTERLY INVESTMENTS IN SWAT REPORT, SO WE'LL MOVE ON FROM THAT AND STAY WITH FINANCE DIRECTOR WILL JONES TO PROVIDE A PRESENTATION ON OUTCOME BASED BUDGETING.
AND ARE WE ABLE TO BRING UP THE PRESENTATION? WHAT'S THAT? OH, I DON'T, OH, I DIDN'T, I DIDN'T THINK TO HAVE SOMEBODY GO BACK THERE.
UM, WELL, HOPEFULLY EVERYONE HAS A COPY OF IT.
DOES EVERYONE HAVE A PHYSICAL COPY OF THE PRESENTATION OR THE ONE THAT I EMAILED YESTERDAY, OR THE ONE THAT YOU, YOU WERE RECEIVED BY EMAIL? YES.
I SHOULD HAVE HAD SOMEBODY READY TO GO BACK THERE.
UM, WELL, I DID WANT TO GIVE THIS PRESENTATION, SO WE'RE ABOUT TO HEAD INTO BUDGET SEASON, UH, NEXT MONTH.
UM, SO I JUST KIND OF WANTED TO GIVE COUNCIL A BRIEFING AND PREPARE FOR, UM, WHAT'S, WHAT'S NEW, WHAT'S CHANGING, UM, AND JUST TO, WE, WE TALKED A LOT ABOUT OUTCOME BASED BUDGETING AND MOVING IN THAT DIRECTION.
UM, SO YOU'RE GONNA SEE A BUDGET THAT'S DIFFERENT THAN WHAT YOU'VE SEEN BEFORE.
UM, AND HOPEFULLY YOU GUYS WILL APPRECIATE SOME OF THE CHANGES WE PUT IN PLACE, UH, TO FOCUS ON PROGRAMS AND PERFORMANCE.
UM, SO MY VISION FOR, FOR THE CITY IS TO TRANSFORM THE WAY LEADERSHIPS MAKE DECISIONS ON THE ALLOCATION OF FINANCIAL RESOURCES BY FOCUSING ON, UM, EXPECTED RESULTS AND OUTCOMES OF CITY SERVICES.
UM, AND, YOU KNOW, SOME OF THE GUIDING PRINCIPLES WILL BE, YOU KNOW, TO BE ABLE TO CLEARLY COMMUNICATE WHAT IS NEEDED FROM CITY STAKEHOLDERS, EVALUATE LEADING BUDGETING PRACTICES, AND INTRODUCE PROCESS EFFICIENCIES AND ADOPT AND REFINE THE PROCESS CHANGES FIRST TO PREPARE FOR A MORE SEAMLESS BUDGET.
UM, SO SOME OF THE IMPACTFUL BENEFITS OF OBB AGAIN IS INFORMED DECISION MAKING, HAVING MEASURABLE RESULTS, UH, LINKAGE TO GOALS, EFFICIENCY, AND, UM, VERY IMPORTANT TRANSPARENCY IN THE BUDGETING PROCESS.
UH, SO IN TERMS OF THIS, UH, THE ROADMAP FOR, FOR OBB, SO WE'VE BEEN WORKING ON THIS FOR A COUPLE OF YEARS NOW.
UM, LAST YEAR WE STARTED WITH SOME INTENSE WORKSHOPS WITH DEPARTMENTS, YOU KNOW, BUILDING THEIR, THEIR PROGRAMS, GOING THROUGH THEIR BUDGET.
UM, AND WE CONTINUE THAT THIS YEAR, UM, HAVING MORE WORKSHOPS WITH DEPARTMENTS, TRYING TO IDENTIFY THOSE PROGRAMS WITHIN THEIR BUDGET.
UM, SO WE'VE EXPANDED, UH, ONE OF THE, THE BIG THINGS WE DID NEW THIS YEAR EXPANDED THE, THE PRIORITIES IN CREATING A STRATEGIC GUIDANCE DOCUMENT.
I THINK THE MAYOR RELEASED THAT IN FEBRUARY OR SO TO ALL THE COUNCIL MEMBERS TO KIND OF GUIDE THE BUDGETING PROCESS.
WE'VE ALSO, FOR THE FIRST TIME DONE A CITIZEN SURVEY AHEAD OF THE BUDGET PROCESS THAT I'LL TALK A LITTLE BIT MORE ABOUT.
UM, AND REALLY JUST TRYING TO CREATE THAT TRANSPARENCY IN THE BUDGET PROCESS AND HIGHLIGHT, UH, THE PROGRAMS AND THE PERFORMANCE MEASURES.
UH, SO LOOKING BEYOND, UH, SO THIS WILL BE THE FIRST YEAR, UH, OF US DOING THIS PROCESS.
SO THERE'LL BE SOME THINGS THAT, UH, YOU'LL SEE IMPROVE OVER TIME.
ONE OF THE THINGS I DO WANNA HIGHLIGHT IS ON THE PERFORMANCE SIDE OF IT, UM, THERE'S
[00:30:01]
SO MANY DIFFERENT PERFORMANCE MEASURES THROUGHOUT THE CITY OF HOUSTON, AND SO THIS FIRST YEAR WE'RE JUST TRYING TO ESTABLISH A BASELINE AND WORK WITH DEPARTMENTS TO FIGURE OUT, OKAY, WHAT THINGS ARE YOU MEASURING? WHAT THINGS SHOULD YOU BE MEASURING? AND TRYING TO ESTABLISH THAT, THAT CONNECTION TO, UH, THE BUDGET.AND THEN HOPEFULLY BEYOND THAT, ONCE WE CREATE THIS, THIS NEW OBB PROCESS, WE, WE ARE GONNA WORK ON BEING ABLE TO TRACK MONTHLY.
SO MAYBE YOUR MONTHLY FINANCIAL REPORT WILL LOOK A LITTLE DIFFERENT NEXT YEAR AS WE START FOCUSING ON PROGRAMS AND PRIORITY.
UM, SO MOVING ON, LIKE I SAID, ONE OF THE THINGS WE DID DO WAS THE, UH, HOUSTONIAN SURVEY.
UM, SO WE ACTUALLY GOT QUITE A BIT OF PARTICIPATION.
NEARLY 2,500 CITIZENS PARTICIPATED IN THAT SURVEY, WHICH, UM, I THINK CONSIDERING, YOU KNOW, THE BUDGET PRO, THAT'S A LOT OF PARTICIPATION.
SO I DO WANT TO THANK THE COUNCIL MEMBERS FOR REACHING OUT TO YOUR CONSTITUENTS, UM, AND ENCOURAGING THEM PARTICIPATE.
UH, SO 2,500 IS A REALLY, REALLY GOOD NUMBER.
UM, AND SO A LOT OF THEM, SOME OF THE THINGS THEY LOOKED AT, UH, ASKING THEM TO RANK THE, THE IMPORTANCE OF SOME OF THEIR PRIORITIES WITH, YOU KNOW, 70%, UH, RANKING PUBLIC SAFETY IS THE MOST IMPORTANT.
23%, I MEAN, 63% SERVICE AND INFRASTRUCTURE.
UM, 44% SOUND FINANCIAL MANAGEMENT.
UM, AND WHAT, WHAT, WHEN YOU BREAK IT DOWN AND LOOK AT SOME OF THE DEMOGRAPHICS, THE, THE CITIZENS BELOW THE AGE OF 34, THEIR FOCUS WAS MORE SO ON COMPLETE COMMUNITIES AND RESILIENT HOUSTON, WHERE'S THOSE THAT ARE, YOU KNOW, 50 AND OLDER.
THEY WERE MORE CONCERNED ABOUT PUBLIC SAFETY, UM, AND SERVICE AND INFRASTRUCTURE.
SO WE GOT A LOT OF GOOD FEEDBACK, UH, FROM THE CITIZENS.
AND WHEN, IF YOU LOOK AT YOUR PACKET, YOU'LL ALSO SEE WE HAD PARTICIPATION FROM EVERY COUNCIL DISTRICT, UM, SO THAT IT WAS A REALLY GOOD PARTICIPATION.
AND SO ONE OF, ONE OF THE, ONE OF THE THINGS I WANTED TO FIND OUT FROM THE CITIZENS IS HOW DO THEY LIKE TO BE INFORMED ABOUT THE BUDGET? SO WE DID GET SOME FEEDBACK FROM THEM.
APPARENTLY THEY REALLY LIKED THE SURVEY.
70% OF THEM WANT, UH, AN EXPANDED ANNUAL SURVEY.
SO THIS YEAR WAS THE FIRST YEAR THAT WE DID IT.
UM, SO NEXT YEAR I'LL HAVE THE OPPORTUNITY TO KIND OF EXPAND THAT AND GET A LITTLE MORE FEEDBACK FROM THE CITIZENS.
UM, PUBLIC FORUMS, ABOUT 51% SAID THEY LIKE PUBLIC FORUMS. SO WHEN WE HAVE OUR BUDGET WORKSHOPS, THEY'RE ABLE TO COME AND, AND PARTICIPATE WHEN WE DO CIP IN THE TOWN HALLS.
UM, SO WE GOT A LOT OF GOOD FEEDBACK FROM THE CITIZENS ON HOW THEY LIKE TO BE INFORMED ABOUT THE BUDGET.
AND THEN ON, UM, CONNECTING BUDGET TO STRATEGY, AGAIN, THAT WAS WHERE WE RELEASED OUR, UM, THE MAYOR'S PRIORITIES, UM, THAT THAT HIGHLIGHTED, YOU KNOW, SOUND FINANCIAL MANAGEMENT, WHAT INITIATIVES UNDER THERE ARE WE FOLLOWING PUBLIC SAFETY, UM, COMPLETE COMMUNITY SERVICE AND INFRASTRUCTURE, AND RESILIENT HOUSTON.
AND ON YOUR PRESENTATION, YOU'LL SEE A LINK TO, TO, UH, TO WHERE THE MAYOR'S, UH, STRATEGIC GUIDANCE DOCUMENT IS.
SO YOU CAN, YOU KNOW, TAKE ANOTHER LOOK AT THAT.
UM, SO ONE THING I DO WANNA HIGHLIGHT, YOU'LL SEE IN OUR PUBLICATION THIS YEAR, THE BUDGET FORMAT IS GONNA LOOK, UH, QUITE A BIT DIFFERENT THAN WHAT YOU'RE USED TO SEEING.
UM, SO SINCE NOW WE'RE FOCUSING ON, UH, PROGRAMS AND PERFORMANCE, LOOKING AT THE, UH, THE PUBLICATION, WE, WE ARE GOING TO MOVE DEPARTMENTS INTO, HAVE THEIR, EVERYTHING ABOUT THE DEPARTMENT BEING ONE LOCATION.
SO, AND, AND PREVIOUS BUDGET PUBLICATION, JUST FOR EXAMPLE, HOUSTON PUBLIC WORKS.
IF YOU ARE A CITIZEN OR COUNCIL MEMBER, YOU WANNA KNOW WHAT WE'RE DOING FOR HOUSTON PUBLIC WORKS, YOU WOULD HAVE TO GO THROUGH AT LEAST FOUR SECTIONS IN THE BOOK TO FIND OUT.
WE HAVE THE GENERAL FUND SECTION, AND THEY HAVE THE ENTERPRISE SECTION.
THEY HAVE SPECIAL FUNDS, AND THEY HAVE REVOLVING FUNDS.
AND THIS IS SCATTERED THROUGHOUT THE BOOK.
SO ONE OF THE THINGS WE ARE CHANGING IS EVERYTHING ABOUT PUBLIC WORKS WILL BE IN ONE LOCATION.
SO YOU LOOK IN ONE PLACE,
SO IT TELLS A BETTER PICTURE OF WHAT THE DEPARTMENTS DO, AND IT HELPS THE CITIZENS AND COUNCIL GO TO ONE LOCATION IN THE BUDGET BOOK AND BE ABLE TO UNDERSTAND WHAT THE DEPARTMENT DOES.
SO THAT'S A BIG CHANGE THAT WE MADE THIS YEAR.
UM, AND THE OTHER THING I WANNA HIGHLIGHT IS, UH, KIND OF THE, THE, THE WORKSHOP TEMPLATES.
SO, UH, WORKSHOPS WILL BE STARTING NEXT MONTH.
SO AGAIN, WE'RE GOING TO MODIFY THE WORKSHOP TEMPLATES TO ALSO FOCUS ON THE PROGRAMS AND THE PERFORMANCE.
UM, IT'S NOT GONNA BE UP FOCUSED ON, UH, THE GL ACCOUNTS.
AND, UH, I REALLY WANT TO, AGAIN, CHANGE THE DISCUSSION AROUND THE BUDGET SO THAT FOR COUNCIL MEMBERS, YOU'RE LOOKING AT THE PROGRAM.
SO YOU'RE NOT HAVING TO GET DOWN IN THE WEEDS OF HOW MUCH ARE WE SPENDING ON THIS PARTICULAR GL, HOW MUCH WE'RE SPENDING ON THAT GL, AND JUST FOCUS ON THE PROGRAMS. UM, SO THAT'S GONNA BE VERY IMPORTANT.
NOW, THE REASON WHY I SAY THAT, 'CAUSE NOW WE WE'RE ALSO, WE, WE WE'RE MORE TRANSPARENT THAN WE'VE EVER BEEN BEFORE.
SO ALL OF THAT DATA ON GL ACCOUNTS AND, AND ALSO ON THE OPEN FINANCE, THE CONTRACTS, THE, THE PAYROLL, ALL THAT STUFF IS AVAILABLE TO
[00:35:01]
EVERYONE.SO I WANT THE BUDGET DISCUSSION TO BE MORE FOCUSED ON PROGRAMS PERFORMANCE.
UM, AND AGAIN, JUST TO REMIND COUNSEL, THIS IS OUR FIRST YEAR.
WE'VE TAKEN A HUGE LEAP AND WE'VE DONE A, WE'RE GONNA BE DOING A LOT OF GREAT THINGS, BUT THERE'S GONNA BE A LOT OF WORK REQUIRED.
SO JUST KIND OF KEEP THAT IN MIND, PARTICULARLY WHEN YOU LOOK AT THE PERFORMANCE.
SO I'VE BEEN MEETING WITH DEPARTMENTS BACK TO BACK
SO I, I DON'T WANT, I DON'T WANT TO GIVE THE IMPRESSION THAT YOU'RE GONNA SEE, UH, A PERFECT, UH, BUDGET THAT SHOWS WE'RE MEASURING EVERYTHING PERFECTLY AND DO, IT'S, IT'S A LOT OF, LIKE I SAID, PERFORMANCE ACROSS THE CITY.
UH, WE DON'T HAVE A SYSTEM YET, BUT WHAT WE'RE DOING NOW IS ESTABLISHING A BASELINE.
IT'LL GIVE YOU A GOOD IDEA OF WHERE WE'RE GOING, AND YOU CAN START ASKING THOSE QUESTIONS.
UM, SO NEXT STEPS, KIND OF IN TERMS OF THE CALENDAR.
UH, SO TOMORROW A BIG STEP WILL BE THE JOURNAL APPROPRIATION THAT SETS THE, THE, THE, THE TRUE UP OF THIS YEAR'S BUDGET, WHICH IS THE, UH, START OF NEXT YEAR'S BUDGET.
SO AGAIN, IF YOU HAVE ANY QUESTIONS ON THAT, PLEASE LET ME KNOW.
AND THEN COMING UP IN MAY, AT THE BEGINNING OF MAY, YOU'LL SEE THE, UH, THE BUDGET RESOLUTION SCHEDULE WHERE WE'LL OUTLINE ALL OF THE, YOU KNOW, THE IMPORTANT DATES THAT'S COMING UP FOR THE BUDGET.
UM, AND THEN THE, UH, THE MAYOR WILL BE RELEASING THE PRO PROPOSED BUDGET, THE BUDGET WORKSHOPS.
I BELIEVE THE SCHEDULES HAVE ALREADY BEEN SENT OUT.
UM, SO BE LOOKING FORWARD TO THAT.
AND THEN IN JUNE IS WHEN WE WILL HAVE THE BUDGET UP FOR, UH, CONSIDERATION.
UM, SO WITH THAT, UH, THAT CONCLUDES MY, MY PRESENTATION.
AND AGAIN, I JUST WANTED TO KIND OF GIVE YOU THIS PREVIEW AHEAD OF MAY SO YOU KIND OF KNOW WHAT TO EXPECT.
UH, FIRST IN THE QUEUE IS COUNCIL MEMBER THOMAS.
UH, AND THANKS FOR RAISING THE POINT ABOUT THE BASELINE.
I WAS CURIOUS ABOUT WHERE WE WERE GONNA START AND THAT, UM, YOUR, UH, MEASURING THAT METRIC MM-HMM
SO OUR EXPECTATION WOULD BE THAT, UM, FOR THE 24, WE'RE GONNA USE WHATEVER FRAMEWORK Y'ALL CREATE AS THE BASELINE, AND THEN EVERY FISCAL YEAR WE'RE GOING TO ASSESS BASED ON THAT.
RIGHT? AND I THINK WHAT YOU'LL FIND TOO IS WHAT, WHAT WE'RE GONNA BE FINDING IS MAYBE THERE'S SOME THINGS WE'RE NOT MEASURING THAT WE SHOULD BE, OR MAYBE WE'RE MEASURING THINGS THAT, YOU KNOW, MAYBE IT'S IMPORTANT, BUT, UH, IT MAY NOT BE AS IMPORTANT TO THE CITIZENS OR COUNCIL.
SO YOU'LL PROBABLY FIND SOME THINGS YOU MAY ASK, WELL, WHY ARE WE MEASURING THAT? AND AGAIN, THIS IS JUST FOR, THIS IS A START.
AND SO WE, WE GOTTA FIGURE OUT WHERE WE NEED TO BE.
AND ONCE YOU TWEAK THAT, IS THERE AN OPPORTUNITY FOR YOU GONNA COME BACK TO COUNCIL OR THE COMMITTEE TO CLARIFY WHAT THAT TOOL IS? I'M ALWAYS, AND MAYBE THIS IS 'CAUSE I'M A FACULTY MEMBER AND WE DO ASSESSMENT ALL THE TIME,
AND THE GOAL IS TO, TO TRY AND START HAVING SOME TYPE OF MONTHLY REPORTING, BUT REALISTICALLY, WHEN IT COMES TO PERFORMANCE, IT'S GONNA BE OVER SEVERAL YEARS FOR US, US TO REALLY GET TO A GOOD PLACE.
THAT'S WHY WE'RE WORKING ON THAT.
SO ONCE WE HAVE ALL OF THOSE THINGS IN PLACE, IT'S, YOU KNOW, I REALLY EXPECT FOR THINGS TO START TO MAKE A LOT MORE SENSE.
WE'RE IN THE THANK YOU, THE INFANT STAGE.
UM, AND I'M CREATING A TOOL TO REALLY ALLOW US IN LAYMAN'S TERMS TO COMMUNICATE TO THE PUBLIC.
I THINK YOU'RE RIGHT IN TERMS OF, UH, PIVOTING TO PROGRAMS MM-HMM
BECAUSE OFTENTIMES WE TALK ABOUT A DOLLAR AMOUNT, BUT WE DON'T ATTACH IT TO THE IMPACT OF WHAT THAT MEANS TO OUR WORK FOR INFRASTRUCTURE, PUBLIC SAFETY, COMPLETE COMMUNITIES.
AND PEOPLE JUST AUTOMATICALLY ASSUME, OH, IT'S AN OVERAGE, BUT THERE'S NO CONTEXT OFTENTIMES GIVEN.
STAFF FROM SHALLEY ALCORN'S OFFICE.
UM, REALLY EXCITED ABOUT ALL THIS COUNCIL MEMBER ALCORN'S TRAVELING TODAY, BUT SHE'S LOOKED AT THE PRESENTATION AND IS JUST GRATEFUL FOR THE CITIZEN SURVEY.
PUBLIC SAFETY AND INFRASTRUCTURE IS THE SAME RESULTS WE'VE SEEN IN OUR PAST SURVEYS.
UM, AND SHE'S LOOKING FORWARD TO THESE PERFORMANCE MEASURES THAT YOU SOUND LIKE YOU'RE SETTING UP FOR US AND USING THAT DATA TO REALLY HAVE MEANINGFUL PERFORMANCE KPIS IN THE ACTUAL BUDGET ITSELF.
UM, WE'RE ALSO REALLY GRATEFUL FOR THE OPEN BUDGET PLATFORM.
I HAVE A FEELING WE'RE STILL GONNA BE LOOKING AT GLS.
YEAH, I MEAN, I, AND I, I DON'T WANNA SAY NOT TO LOOK AT THEM.
I, I JUST WANNA SAY THIS YEAR I REALLY WANT YOU GUYS TO FOCUS ON THE PROGRAMS BECAUSE WHEN YOU LOOK AT THE GL ACCOUNTS, THEIR GL ACCOUNTS ARE GONNA BE ACROSS MULTIPLE PROGRAMS. AND, UM, IT'S IMPORTANT THAT WE UNDERSTAND HOW YOU KNOW WHAT THE DEPARTMENTS ARE DOING AND WHAT THE PURPOSE OF THAT PROGRAM IS.
UM, AND TO, BEFORE WE SAY, OKAY, LET'S, UH, YOU KNOW, THIS GL ACCOUNT LOOKS TOO LOW, LET'S ADD MORE.
NO, LET'S FOCUS ON, OKAY, WHAT IS THAT PROGRAM DOING? AND WHAT ARE, WHAT ARE THEY PERFORMING? WHAT IS THE EXPECTED OUTCOME? AND THAT IS TRULY WHERE WE NEED TO GET TO IN TERMS OF HOW WE MAKE DECISIONS.
AND NOT SO MUCH ON THE GRANULAR GL ACCOUNTS.
IT IT, I MEAN, I GET IT, IT'S WHEN YOU WANNA GET THAT DETAILED, BUT WHEN YOU,
[00:40:01]
WHEN YOU THINK ABOUT THE DECISIONS WE NEED TO MAKE OR YOU GUYS NEED TO MAKE, OR THE MAYOR, IT SHOULD BE MORE CENTERED AROUND, UH, THE, THE PROGRAMS AND THEN WHAT WE ARE MEASURING AS A, AS A SUCCESS ON THE OUTCOMES.BUT YEAH, OF COURSE THE, THE INFORMATION IS THERE AND I, AND I, I DON'T WANNA DISCOURAGE ANYONE FROM, FROM FOCUSING ON IT, BUT I ALSO WANNA ALSO START CHANGING SOME OF THE DISCUSSION AND WHEN WE TALK ABOUT BUDGET AND HOW WE MAKE DECISIONS.
I'M, MY QUESTION IS, IS THE RAW DATA GONNA BE PUBLISHED THE SAME? YEAH.
PREVIOUS YEARS? WE'LL, WE'LL STILL HAVE ALL THE RAW DATA AVAILABLE AS WELL.
COUNCIL MEMBER KOOSH, YEARS AGO THERE WAS A REAL PUSH FOR ZERO BASED BUDGETING.
SO I GUESS WE CAN SAY THAT JUST DIDN'T WORK WELL.
I MEAN, THE, THE INTENT WAS ALWAYS TO DO OUTCOME BASED BUDGET.
I THINK FOR SOME WE WEREN'T MOVING FAST ENOUGH FOR THAT.
UM, SO WHEN THE MAYOR FIRST CAME IN THE OFFICE, HE, IN ONE OF HIS FIRST ACTIONS WAS EXECUTIVE ORDER ONE DASH 53, WHICH SET UP A PERFORMANCE BASED BUDGETING IN BETWEEN THERE.
UM, YOU KNOW, WE HAD HURRICANES AND DISASTERS, SO THINGS KIND OF GOT DELAYED.
AND IN ONE YEAR, UH, I THINK THERE WAS A COUNCIL AMENDMENT THAT SAID ZERO BASED BUDGET, SO IT KIND OF THREW ME A CURVE BALL.
SO I HAD TO STOP WHAT WE WERE DOING ON OUTCOME BASED BUDGET, WHICH I UNDERSTAND 'CAUSE YOU HADN'T SEEN IT.
SO, YOU KNOW, WHEN YOU DON'T SEE IT, YOU MAY THINK WE'RE NOT DOING ANYTHING ON IT, BUT WE WERE WORKING VERY HARD ON OUTCOME BASED BUDGET.
TOOK A DETOUR TO SHOW YOU WHAT ZERO BASED BUDGET WAS, AND WE DID THAT.
UM, AND NOW WE'RE BACK ON TRACK WITH WHAT THE INITIAL PLAN WAS TO PRESENT A PERFORMANCE BASED TYPE BUDGET.
I SEE NO OTHER COUNCIL MEMBERS IN THE QUEUE, AND WE HAVE NO PUBLIC SPEAKERS THAT HAVE SIGNED UP FOR A COMMENT.
SO, UH, BEFORE WE ADJOURN, PLEASE NOTE THE NEXT REGULARLY SCHEDULED BUDGET AND FISCAL AFFAIRS COMMITTEE MEETING WILL BE ON MAY 30TH AT 10:00 AM AND IF THERE ARE NO OTHER COMMENTS AND QUESTIONS, THIS MEETING IS ADJOURNED.