[Budget and Fiscal Affairs on August 1, 2023.]
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CASTEX TATUM'S OFFICE DISTRICT K COUNCIL MEMBER MICHAEL KNOX AT LARGE POSITION ONE.COUNCIL MEMBER DAVID ROBINSON AT LARGE POSITION TWO.
AND COUNCIL MEMBER LETICIA PLUMMER AT LARGE POSITION FOUR.
IF THERE ARE ANY MEMBERS OF THE PUBLIC THAT WOULD LIKE TO PARTICIPATE IN PUBLIC COMMENT, THERE'S A SIGNUP SHEET AT THE FRONT TABLE.
MY STAFF MEMBER, DAMARI PEREZ WILL BE MONITORING THE PUBLIC SPEAKERS LIST.
COUNCIL MEMBERS AND STAFF PLEAD HOLD YOUR QUESTIONS UNTIL THE END OF THE PRESENTATION.
AS OUR DEADLINE YESTERDAY AT THREE O'CLOCK.
THERE WERE NO PUBLIC SPEAKERS.
IF THERE ARE ANY MEMBERS OF THE PUBLIC THAT WOULD LIKE TO PARTICIPATE IN TODAY'S MEETING, THERE'S A SIGNUP SHEET AS I REMINDED TO MY LEFT TO YOUR RIGHT, AND WE WILL BE MONITORING THIS.
UH, BEFORE WE START, I WOULD LIKE TO, UM, UM, ANNOUNCE THAT COUNCIL MEMBER SALLY ALCORN WILL BE SITTING IN THIS CHAIR IN ROUGHLY 15 MINUTES, AS I HAVE AN APPOINTMENT AT 11 O'CLOCK THAT I NEED TO BE AT.
UH, BEFORE WE START, UM, SOME TREMENDOUS NUMBERS THAT I'VE NEVER SEEN IN THE HISTORY OF MY 11 YEARS ON CITY COUNCIL.
YOU'LL HEAR FROM CONTROLLER AS WELL AS CITY FINANCE DEPARTMENT REVENUES PROJECTED TO BE ANYWHERE FROM 442 MILLION TO 450 MILLION, UH, UH, IN FUND BALANCE.
REVENUE POLICY, AS YOU KNOW, IS 7.5 REQUIRED OF EXPENDITURES.
UM, AND THEN WHEN YOU LOOK AT THE EXPENSE SIZE, WE'LL HEAR ABOUT A DECREASE OF $23 MILLION PREDOMINANTLY IN PERSONNEL COSTS.
SO, YOU KNOW, YOU LOOK AT IT FROM A FINANCE PERSPECTIVE, YOU LOOK AT NET PRESENT VALUE.
WHAT IS THE PRESENT VALUE OF YOUR ORGANIZATION? UH, THE DEBT WAS REDUCED FROM $8.2 BILLION TO 2.2 BILLION FOR PENSION OBLIGATION BONDS, WHICH YOU BOTH WERE VERY INVOLVED IN.
UH, OPE, UH, FROM 9.1 TO 4.5 WITH A TRUST ACCOUNT THAT JUST STARTED ON JULY 1ST.
SO, UH, CONTROLLER BROWN, THANK YOU FOR WORKING WITH US ON THAT.
IT WAS AN HONOR TO DO IT, BUT WHEN YOU LOOK AT THE FINANCIAL POSITION TODAY IN THE CITY OF HOUSTON, IT HAS NEVER BEEN STRONGER.
NOW, DO WE HAVE ANY CHALLENGES? SURE, WE DO.
COVID MONEY GOES AWAY, ARPA FUNDS GO AWAY, AND THEN WE'LL BE WORKING WITH REVENUES AND EXPENSES THAT ARE COMING TO A HEAD, PROBABLY IN, IN FISCAL YEAR 26, MAYBE A LITTLE BIT BEFORE THAT, WHICH BEGINS FOR US IN THE YEAR 25.
SO, UH, BUT PRESENT VALUE OF THE CITY OF HOUSTON IS, IS IN GOOD SHAPE.
SO I'D LIKE TO THANK THE CONTROLLER'S OFFICE AND I'D LIKE TO THANK THE CITY'S FINANCE DEPARTMENT AND THE ADMINISTRATION FOR THESE NUMBERS WE ARE ABOUT TO HEAR.
SO I THINK THEY ARE TREMENDOUS, AND I'D LIKE TO WELCOME, UH, COUNCIL MEMBER SALLY ALCORN AND STAFF FROM COUNCIL MEMBER CARLOS CIRO'S OFFICE.
SO, UH, CONTROLLER BROWN, UM, LIKE TO WELCOME YOU AND PROVIDE THE MONTHLY FINANCIAL REPORT.
YOU'LL ALSO BE PROVIDING THE QUARTERLY INVESTMENT AS WELL AS A SWAP REPORT.
AND IN MY OPINION, SWAP IS A FOUR LETTER WORD, AS YOU KNOW, AND YOU AND I HAVE DISCUSSED.
UM, I'M PLEASED TO PRESENT THE MONTHLY FINANCIAL REPORT FOR THE PERIOD ENDING JUNE 30TH AND THE GENERAL FUND, THE CONTROLLER'S OFFICE IS PROJECTING THE ENDING FUND BALANCE OF 442.4 MILLION FOR FY 23.
THIS IS 7.6 MILLION LOWER THAN THE PROJECTION OF THE FINANCE DEPARTMENT.
BASED ON OUR CURRENT PROJECTIONS, THE FUND BALANCE WILL BE APPROXIMATELY 268.8 MILLION ABOVE THE CITY'S TARGET OF HOLDING 7.5% RESERVES.
OUR REVENUE PROJECTIONS INCREASE BY 23.7 MILLION FROM THE MAY 23 REPORT, AND THAT'S DUE TO THE FOLLOWING.
PROPERTY TAX INCREASED BY 9.4 MILLION DUE TO HIGHER THAN ANTICIPATED COLLECTIONS.
INDUSTRIAL ASSESSMENTS INCREASED BY 5.9 MILLION DUE TO HIGHER THAN ANTICIPATED RECEIPTS.
SALES TAX INCREASED BY 5 MILLION, ALSO DUE TO HIGHER THAN ANTICIPATED RECEIPTS.
ELECTRIC FRANCHISE FEES INCREASED BY 700,000 DUE TO HIGHER THAN ANTICIPATED RECEIPTS.
LICENSES AND PERMITS INCREASED BY 600,000.
UH, AND THAT WAS DUE TO HIGHER RECEIPTS FROM LIQUOR LICENSES, FOOD DEALER PERMITS AND LIMOUSINE PERMITS.
CHARGES FOR SERVICES INCREASED BY 2.5 MILLION, AND THAT WAS DUE TO HIGHER ANTICIPATED AMBULANCE FEE COLLECTIONS.
DIRECT INTERFUND CHARGES DECREASED BY 1 MILLION, AND THAT WAS DUE TO LOWER CHARGEBACKS FOR POLICE SERVICES PROVIDED BY THE HOUSTON AIRPORT SYSTEM AND CONTRACT COMPLIANCE SERVICES PROVIDED TO HOUSTON PUBLIC WORKS.
LOOKING AT EXPENDITURES, THE EXPENDITURE ESTIMATES DECREASED BY 22.8 MILLION FROM THE F UH, FROM THE MAY 23 REPORT.
AND THAT WAS DUE TO HIRING DELAYS IN PERSONNEL COST SAVINGS AS WELL AS SAVINGS ON SUPPLIES AND
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SERVICES IN THE FOLLOWING DEPARTMENTS.UH, A RA DECREASED BY 2.1 MILLION CITY CONTROLLER DECREASED BY 638,000.
FINANCE DEPARTMENT DECREASED BY 2.7 MILLION.
HEALTH DEPARTMENT, DECREASED BY 2 MILLION.
LEGAL DEPARTMENT, DECREASED BY 1 MILLION, LIBRARY, DECREASED BY 1 MILLION MUNICIPAL COURTS DECREASED BY 1.8 MILLION DEPARTMENTS OF NEIGHBORHOODS DECREASED BY 783,000.
UH, OBO DECREASED BY 1.1 MILLION.
PARKS AND RECREATIONS DECREASED BY 3.5 MILLION.
PLANNING AND DEVELOPMENT DECREASED BY 747,000.
AND FINALLY, THE POLICE DEPARTMENT DECREASED BY 5 MILLION.
MOVING ON TO THE ENTERPRISE FUNDS IN THE AVIATION OPERATING FUND, TOTAL OPERATING REVENUES INCREASED BY 12.6 MILLION.
TOTAL OPERATING EXPENDITURES INCREASED BY 1.8 MILLION.
NON-OPERATING REVENUES INCREASED BY 17.6 MILLION, AND TOTAL TRANSFERS FROM THE REVENUE FUND TO THE AIRPORT IMPROVEMENT FUND INCREASED BY 28.4 MILLION IN THE CONVENTION AND ENTERTAINMENT FACILITIES OPERATING FUND.
TOTAL OPERATING REVENUES INCREASED BY 1.1 MILLION.
NON-OPERATING REVENUES INCREASED BY 2.3 MILLION, AND THAT WAS DUE TO HIGHER THAN ANTICIPATED HO HOTEL OCCUPANCY TAX RECEIPTS IN THE COMBINED UTILITY SYSTEM.
NON-OPERATING, TOTAL NON-OPERATING REVENUE, OR I'M SORRY, TOTAL OPERATING REVENUES INCREASED BY 17.2 MILLION AND THAT WAS DUE TO HIGHER THAN ANTICIPATED WATER AND SEWER REVENUE.
TOTAL OPERATING EXPENSES DECREASED BY 26.4 MILLION, AND THAT WAS PRIMARILY DUE TO CONTRACT DELAYS.
PERSONNEL SAVINGS LOWER THAN ANTICIPATED SPENDING ON ELECTRICITY, GAS, AND NON-CAPITAL EQUIPMENT.
THE TOTAL TRANSFERS DECREASED BY 20 MILLION.
UH, AND THAT WAS DUE TO LOWER THAN ANTICIPATED DEBT SERVICE TRANSFERS, EQUIPMENT ACQUISITION AND TRANSFERS TO THE STORM WATER FUND.
TOTAL REVENUES DECREASED BY 3.3 MILLION.
TOTAL EXPENDITURES ALSO DECREASED BY 3.3 MILLION DUE TO LOWER THAN ANTICIPATED PERSONNEL COSTS, SUPPLIES, AND OTHER SERVICES.
MOVING ON TO DEDICATED DRAINAGE AND STREET RENEWAL FUND AT VALOREM, THE TOTAL EXPENDITURES DECREASED 21.1 MILLION AND THE DEDICATED DRAINAGE AND STREET RENEWAL FUNDS DRAINAGE CHARGE.
TOTAL REVENUES INCREASED BY 2 MILLION, AND TOTAL EXPENDITURES DECREASED BY 4.5 MILLION IN THE DEDICATED DRAINAGE AND STREET RENEWAL FUND.
METRO TOTAL REVENUE INCREASE BY 13.5 MILLION AND TOTAL EXPENDITURES DECREASED BY 6.6 MILLION.
MOVING ON TO OUR COMMERCIAL PAPER AND BONDS, YOU'LL SEE THAT ALL OF OUR VARIABLE RATE DEBT IS WELL BELOW THE 20% THRESHOLD.
SO I'LL MOVE ON TO THE QUARTERLY INVESTMENT AND SWAP REPORT.
AS OF JUNE 30TH, THE CITY HAD 5.66 BILLION INVESTED IN OUR GENERAL INVESTMENT POOL INVESTMENTS ARE 370 MILLION HIGHER THAN LAST YEAR.
UH, THIS IS PRIMARILY ATTRIBUTABLE TO THE TEXAS WATER DEVELOPMENT BOARD LOAN AND INCREASE IN FUNDING FROM CAPITAL PROJECTS, FUNDS, THE COMMERCIAL PAPER ISSUANCE AND HIGHER SALES TAX.
IN THE GENERAL FUND AS OF JUNE 30TH, THE GENERAL INVESTMENT POOL WAS YIELDING 2.5220000000000002%, WHICH IS UP FROM THE 2.368% YIELD IN THE PRIOR QUARTER.
AND MOVING ON TO OUR SWAP REPORT, THE CITY HAD A, HAD NET PAID FOR THE FISCAL YEAR ENDING JUNE 30TH FROM ITS SWAPS OF 4.2 MILLION, SO A NET PAYMENT OF 4.2 MILLION.
THE FAIR VALUE FOR BOTH SWAPS AS OF JUNE 30TH, 2023 WAS NEGATIVE 122 MILLION.
THAT'S APPROXIMATELY 2 MILLION MORE THAN LAST QUARTER.
AND MR. CHAIRMAN, AS YOU ALLUDED TO, WE ARE CONTINUING TO MONITOR THESE SWAPS.
THE ONE OF THE SWAPS NOW IS A NEGATIVE 27, UM, MILLION DOLLARS FAIR VALUE.
SO AS THAT APPROACHES TO ZERO, WE WILL HOPEFULLY FIND A SOLUTION TO EXIT OUTTA THOSE AND, UH, MOVE FORWARD IN THE FUTURE.
THANK YOU, CONTROLLER BROWN AND UH, FINANCE DIRECTOR, THE ALWAYS DAPPER DRESS WILL JONES
THIS IS THE 12 PLUS ZERO FINANCIAL REPORT FOR THE PERIOD ENDING JUNE 30TH, 2023.
PROJECTIONS ARE BASED ON 12 MONTHS OF ACTUAL RESULTS.
HOWEVER, INVOICES FOR GOODS AND SERVICES PROVIDED IN FISCAL YEAR 2023 DUE CONTINUE TO COME IN.
THESE EXPENSES CONTINUE TO BE, UH, RECORDED AS ACCRUALS TO FISCAL YEAR 2023 UNTIL AUGUST 31ST.
SO THE RESULTS ARE NOT FINAL UNTIL THE PUBLICATION OF THE FY 23 ANNUAL COMPREHENSIVE FINANCIAL REPORT.
UH, NEXT MONTH WE WILL BEGIN PRESENTING THE MONTHLY FINANCIAL REPORT FOR FISCAL YEAR 2024.
AT THE TIME OF THE 24 ADOPT BUDGET, THE BEGINNING FUND BALANCE WAS ESTIMATED TO BE, UH, 420 MILLION AND THIS 12 PLUS, UH, ZERO FINANCIAL REPORT, WE ARE CURRENTLY PROJECTING THAT THIS FUND BALANCE WILL BE 450 MILLION, AN INCREASE OF 30 MILLION.
UM, SO FOR THE GENERAL FUND FOR THIS MONTH, OUR REVENUE PROJECTION IS 108 MILLION HIGHER THAN THE ADOPTED BUDGET AND 6.7 MILLION HIGHER THAN LAST MONTH.
AND THAT'S PRIMARILY DUE TO 3.5 MILLION INCREASE IN INDUSTRIAL ASSESSMENTS DUE TO HIGHER THAN ANTICIPATED COLLECTIONS.
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INCREASE IN CHARGES FOR SERVICES, 1.1 MILLION INCREASE IN MUNICIPAL COURT FINES AND FORFEITS.UH, 814 INCREASE IN INTEREST TO REFLECT HIGHER THAN ANTICIPATED RECEIPTS.
668, UH THOUSAND, INCREASE IN LICENSE AND PERMITS 1 MILLION INCREASE IN THE DIRECT INTER FUND SERVICES.
UH, 595,000 DECREASE IN MISCELLANEOUS OTHER AND 535,000 DECREASE IN SALE OF CAPITAL ASSETS.
UM, ON THE EXPENDITURE PROJECTIONS, UH, OUR PROJECTION IS 6.5 MILLION HIGHER THAN THE ADOPTED BUDGET, AND 22.8 MILLION LOWER THAN LAST MONTH.
THE VARIANCE FROM LAST MONTH IS DUE TO YEAR END SAVINGS AND PERSONNEL SUPPLIES AND SERVICES FOR VARIOUS DEPARTMENTS.
UH, WE ARE CURRENTLY PROJECTING THE END FUND BALANCE OF 450 MILLION, WHICH IS 101.5 MILLION HIGHER THAN THE ADOPTED BUDGET.
AND 19.4% OF ESTIMATED EXPENDITURES, LESS DEBT SERVICE AND PAY AS YOU GO.
THE FUND BALANCE IS 276.3 MILLION ABOVE THE TARGET AT 7.5% OF EXPENDITURES, EXCLUDING DEBT SERVICE AND PAY AS YOU GO.
UH, WE AGREE WITH THE CONTROLLER FOR ALL OF THE ENTERPRISE FUNDS AND, AND THE DEDICATED DRAINAGE STREET RENEWAL FUND.
SO I'LL MOVE ON JUST TO HIGHLIGHT A FEW OF THE SPECIAL FUNDS.
WE DO HAVE QUITE A BIT OF CHANGES, BUT THERE ARE A FEW OF THEM THAT I WILL HIGHLIGHT FOR YOU TODAY.
UH, MOVING ON TO THE HEALTH BENEFITS FUND.
THE REVENUES DECREASED BY 9.4 MILLION DUE TO LOWER ENROLLMENT AND EXPENDITURES DECREASED BY 19.7 MILLION, MAINLY DUE TO LOWER CLAIMS AND THEIR PROPERTY AND CASUALTY FUND.
REVENUES AND EXPENDITURES DECREASED BY 11.2 MILLION, MAINLY DUE TO A LOWER THAN ANTICIPATED COST FOR LEGAL SERVICES.
UH, AND THE WORKERS' COMPENSATION FUND.
OPERATING REVENUES AND EXPENDITURES DECREASED BY 5.6 MILLION, MAINLY DUE TO A LOWER THAN ANTICIPATED CLAIMS. AND THE BUILDING INSPECTION FUND REVENUES INCREASED BY 2.2 MILLION DUE TO HIGHER THAN ANTICIPATED PERMIT AND CONSTRUCTION ACTIVITIES AND EXPENDITURES DECREASED BY 2.4 MILLION DUE TO, UH, CONTRACT IMPLEMENTATION DELAYS.
AND THEN WE HAVE THE HEALTH SPECIAL REVENUE FUND.
UH, REVENUES DECREASED BY 1 MILLION DUE TO LOWER THAN ANTICIPATED REIMBURSEMENT, UM, AND EXPENDITURES DECREASED BY 4.8 MILLION DUE TO SAVINGS, UH, IN PERSONNEL SERVICES.
UH, SO MOVING ON TO JUST A QUICK UPDATE ON THE HOUSTON ECONOMY.
THE AVERAGE ALL PRICE OF $70 25 CENTS FOR THE MONTH OF JUNE WAS 1.9% LOWER THAN LAST MONTH.
UH, THE AVERAGE ALL RATE COUNT OF 551 FOR THE MONTH OF JUNE WAS 5% LOWER THAN PRIOR MONTH'S COUNT.
UH, LOOKING AT EMPLOYMENT, UH, ACCORDING TO THE BUREAU OF LABOR STATISTICS, THE PRELIMINARY TOTAL NON-FARM EMPLOYMENT IN HOUSTON, HOUSTON METROPOLITAN AREA STOOD AT THREE POINT, UH, 4 MILLION IN MAY OF 2023, DOWN ABOUT 0.6% OF THE PRELIMINARY UNEMPLOYMENT RATE FOR MAY WAS 4.4% COMPARED TO PRIOR MONTHS OF 3.9%.
IN MAY OF 22, THE EMPLOYMENT RATE WAS 4.3%.
UH, LOOKING AT HOME SALES, THE LATEST REPORT, UM, PREPARED BY HAR OR THE HOUSTON ASSOCIATION OF REALTORS FOR THE MONTH OF JUNE SHOWS THE TOTAL SINGLE FAMILY HOME SALES OF 8,000 5 82 WERE 11.8, UH, PERCENT LOWER COMPARED TO JUNE OF 2022.
AND THE MEDIUM PRICE LOWERED BY 2.5% AT 345,000, AND THE AVERAGE PRICE DECREASED BY 0.5% TO 431,000.
THANK YOU AND EXCELLENT REPORT AND GREAT NEWS AS ALWAYS.
AND, UM, UH, CONTROLLER, UM, NUMBERS LOOK GOOD ON THE INVESTMENT SIDE, SO THANK YOU AND YOUR TEAM THEN I SEE OUT THERE.
FIRST QUESTION COMES FROM, COMES FROM SALLY ALCORN.
YOU SAY, UH, ENDING FUND BALANCE WILL OF 450 MILLION, 101 MILLION HIGHER THAN THE ADOPTED BUDGET.
BUT I THOUGHT, I MEAN, AND I'M LOOKING, IT WAS, I THOUGHT OUR ENDING FUND BALANCE IN THE BUDGET WAS LIKE FOUR 20 SOMETHING.
TALKING ABOUT, WELL, FOR OR LA ARE YOU TALKING ABOUT LAST I TALKING ABOUT LA LAST? THE FFY 20 THREES BUDGET.
SO WHERE, WHAT WAS OUR ENDING FUND? I MEAN, I CAN WHAT WAS THE FUND BALANCE FOR THE ADOPTED BUDGET FOR FFY 24.
YEAH, THAT'S WHY IT'S A LITTLE CONFUSING.
THAT WAS CONFUSING BECAUSE I WAS LIKE, I THOUGHT WE WERE HIGHER THAN THAT.
I HAVE NO OTHER QUESTIONS IN QUEUE, SO, AND I DON'T BELIEVE WE HAVE ANY PUBLIC SPEAKERS.
SO A LOT OF GOOD NEWS, YOU KNOW, THE PERSONNEL FRONT, 23% SAVINGS IS A DOUBLE-EDGED SWORD.
WE'RE LOSING A LOT OF GOOD EMPLOYEES BECAUSE COMPETITIVE SALARIES, UM, THAT WE SOMETIMES STRUGGLE WITH.
AND THAT POINTS TO DISPARAGING STUDY THAT WE NEED TO GET DONE SO THAT WE CAN LOOK AT THE CITY SALARIES VERSUS THE PRIVATE SECTOR SAL SALARIES.
AND, UH, WHILE YOU LIKE TO SEE 23% REDUCTION IN, IN PERSONNEL COSTS, IT COMES AT A COST TO THE CITY.
WE CAN'T DO A LOT OF THE THINGS THAT WE REALLY WANT TO DO.
SO, UM, AND WE NEED TO LOOK AT THAT DISPARAGING STUDY COUNCIL MEMBER ALCORN, AND MAKE SURE THAT, UM, THAT WE'RE DOING THE BEST JOB WE CAN.
SO, ANY OTHER CLOSING QU COMMENTS,
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GENTLEMEN? NO, I WOULD JUST SAY, UH, AND MANY OF YOU GUYS HAVE HEARD OVER THE LAST COUPLE YEARS, UH, TALKING A LITTLE BIT ABOUT THE VOLATILITY IN ALL OF OUR REVENUES.AND WE DEFINITELY, UH, HAVE SEEN AS WE END, UH, THIS FISCAL YEAR AN INCREASE IN BOTH PROPERTY AND SALES TAX.
BUT, UM, I THINK I, I LIKEN THIS TO, UM, THE IRRATIONAL EXUBERANCE OF THE LATE NINETIES.
UM, WE'VE, WE'VE SEEN SALES TAX, UH, INCREASE, UM, ALMOST AT A PARABOLIC RATE.
UH, SO AGAIN, TO CAUTION COUNSEL THAT, UM, YOU KNOW, IT'S NOT SUSTAINABLE AT SOME POINT WE'RE GONNA SEE A REVERSION, UH, BACK DOWN, UH, TO THE MEAN, AS I SAY.
UM, I KNOW THAT WE JUST RECENTLY REVIEWED A REPORT THAT BILL GILMER HAD AUTHORED, UH, THAT HAS HIS, UM, BEST CASE SCENARIO FOR SALES TAX FOR FY 24 AT 6% DOWN, AND, AND HIS WORST CASE AT 10% DOWN.
UH, SO THIS ADOPTED BUDGET IS AT 3%.
UM, UH, OUR TRENDS WAS A LITTLE OVER 6%.
UM, BUT IF WE HAVE THAT DOWN 10%, UH, YOU KNOW, IT'S GONNA START THAT DOWNWARD PROGRESSION AS WE SEE THE EXPIRATION OF THE FEDERAL FUNDING AND ALSO HAVING TO NEGOTIATE THINGS LIKE INCREASED EXPENDITURES FOR INFRASTRUCTURE AND ALSO, UH, THE FIRE PAY PARITY.
SO, YOU KNOW, THERE'S, THERE'S A LOT OF THINGS ON THE HORIZON.
SO I, I, I TOO SHARE IN THE, UM, I GUESS THE JOY OF, OF SEEING THIS MUCH MONEY COMING TO THE CITY POST COVID BECAUSE IT'S A ALMOST COMPLETE REVERSAL OF FORTUNE.
UM, I WOULD JUST CAUTION EVERYONE THAT I THINK, UH, ON THE HORIZON, UH, WE HAVE SOME, UM, SOME CHALLENGES AND EVEN WITH A 268.8 MILLION OVER THE 7.5% THAT WE'RE ESTIMATING, UM, WE COULD SEE WITH A 10% DECREASE IN SALES TAX, A CORRESPONDING, UH, EFFECT ON PROPERTY TAX, UH, ESSENTIALLY US BURNED THROUGH THAT IN THE FIRST ONE YEAR, RIGHT? AT THE SAME TIME THAT THE COVID, UH, MONEY IS EXPIRING.
SO, UM, WE JUST HAVE TO CON CONTINUE TO MONITOR THIS AND, AND, YOU KNOW, HOPE THAT, UH, IT'S A SOFT LANDING AND THAT, UH, WE DON'T HAVE, UH, TOO FAR OF A DOWNTURN.
BUT I, I WOULD SAY WE PROBABLY DO NEED TO PREPARE FOR THE ULTIMATE, UM, POSSIBILITY AGAIN, WITH GILMER SAYING THERE'S A CHANCE THAT WE COULD BE DOWN PER 10% ON SALES TAX.
SO NOT TO DARKEN THE MOOD A LITTLE BIT, BUT I ALWAYS LIKE TO PLAN FOR PLAN FOR THE FUTURE BECAUSE IT'S A LOT EASIER TO DEAL WITH THIS IN ADVANCE.
SO THANK YOU FOR YOUR, UH, TIME AND APPRECIATE IT.
THANK YOU, DIRECTOR JONES, ANY LAST MINUTE COMMENTS? UM, YEAH, I, I'LL SAY I GET IT, AND I THINK YOU SUMMED IT UP, UH, VERY WELL AT THE BEGINNING.
MAYOR PRO TEM, UH, YEAH, THIS IS BY FAR THE STRONGEST, UH, BUDGET, UH, FINANCIAL POSITION THE CITY'S BEEN IN.
AND I DO AGREE WITH THE CONTROLLER IN THAT, UH, THE SALES TAX IS NOT GONNA BE SUSTAINABLE, WHICH IS WHY WE DID DECREASE IT.
AND, UH, FOR THE PAST COUPLE OF YEARS, UH, THE ECONOMISTS, EVERYONE HAS HAD CHALLENGES TRYING TO PREDICT EXACTLY WHAT THE SALES TAX IS GONNA DO, AND THEY'VE BEEN OFF BY, YOU KNOW, WILD MARGINS.
UM, BUT I THINK EVERYONE IS IN ALIGNMENT THAT IS GONNA GO DOWN, UM, WHETHER IT'S GONNA BE 10% OR 3%, WE'RE, WE'RE GOING TO, YOU KNOW, MONITOR IT CLOSELY AND, AND, AND BE PREPARED FOR, YOU KNOW, THAT DOWNTURN.
AND AS YOU STATED, YES, 2024 AND 25, YOU KNOW, WE MAY BE OKAY AND WE KNOW THAT 26 AND BEYOND FOR SURE, WE'RE GONNA HAVE CHALLENGES.
UM, BUT YOU KNOW, FOR NOW, UH, THIS IS BY FAR THE STRONGEST BUDGET AND, UH, IT'S, IT'S WORTH, UH, YOU KNOW, NOTING AND HOPEFULLY THE CREDIT RATING AGENCIES ARE PAYING ATTENTION TO THAT AS WELL, AND, AND THAT THEY CAN SEE THAT HOUSTON IS STRONG FINANCIALLY AND THAT NO MATTER WHAT FISCAL CHALLENGES MAY COME OUR WAY, WE WILL BE ABLE TO OVERCOME IT.
SO THAT'S WHAT I WANT THE, YOU KNOW, THE CREDIT RATING AGENCIES TO TAKE FROM, FROM THIS.
WHILE IT MAY BE A DOWNTURN POTENTIALLY IN REVENUE, THE CITY OF HOUSTON HAS PROVEN THAT WE ARE ABLE TO WITHSTAND THAT AND WE WILL WITHSTAND THAT.
AND I THINK, YOU KNOW, THE, THE, THE KILLER FOR STATE GOVERNMENT AND CITY GOVERNMENT AND LOCAL GOVERNMENTS HAS ALWAYS BEEN THE DEBT.
I LIKE WHAT WE SEE ON THE DEBT SIDE, YOU KNOW, THAT GOES TO THE OPE TRUST COMP, UH, FUND AND ALSO THE PENSION OBLIGATION BONDS.
AND I KNOW AS LONG AS WE HAVE, YOU KNOW, ALYSSA DEBOWSKI OUT THERE WITH THE BOND FRONT, AND MS. MOSELEY DID A GREAT JOB AND LOOKING FORWARD TO VERNON'S IN INVOLVEMENT IN THAT AS WELL.
I THINK WE'RE IN REALLY GOOD SHAPE.
SO, UH, WITH THAT, I SEE NO OTHER COMMENTS.
UH, I WOULD LIKE TO REMIND EVERYONE THAT THE NEXT QUARTERLY SCHEDULE, BUDGET, AND FISCAL AFFAIRS COMMITTEE MEETING WILL BE ON TUESDAY, AUGUST 29TH AT 10:00 AM WELL, WE'LL, WHERE WE WILL PRESENT ONE OF 12, THE FIRST MONTH OF THE FISCAL YEAR, 2024.