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[Budget and Fiscal Affairs on February 3, 2025.]
FEBRUARY 3RD, 2025.BUDGET AND FISCAL AFFAIRS COMMITTEE.
UH, MY NAME IS SALLY ALCORN, THE CHAIR OF THIS COMMITTEE, AND I CALL THIS COMMITTEE TO ORDER.
AND ONE TO WELCOME MY VICE CHAIR, COUNCIL MEMBER, MARIO CASTILLO.
UH, COUNCIL MEMBER TWILA CARTER.
COUNCIL MEMBER JOAQUIN MARTINEZ.
COUNCIL MEMBER MARY ANNE HUFFMAN, WHO ARE ALL IN CHAMBER COUNCIL MEMBER TIFFANY THOMAS, WHO IS JOINING US ONLINE.
AND WE HAVE STAFF FROM COUNCIL MEMBER CAROLYN EVANS SHABAZZ'S OFFICE.
UM, COUNCIL MEMBER VICE MAYOR PROAM, AMY PEX, OFFICE COUNCIL MEMBER FLICKINGER OFFICE.
COUNCIL MEMBER CAYMAN'S OFFICE AND COUNCIL MEMBER JACKSON'S OFFICE.
WE'LL START WITH THE, UH, QUARTERLY FINANCIAL REPORTS, UM, BOTH FROM THE FINANCE DIRECTOR AND AND CONTROLLER.
CHRIS HOLLINS, UH, COULD NOT JOIN US THIS MORNING, BUT I UNDERSTAND DEPUTY CONTROLLER VERNON LEWIS IS JOINING US.
SO GREAT TO SEE YOU AND WE WILL, UM, WE WILL JUMP RIGHT IN.
AND WE'VE ALSO BEEN JOINED BY COUNCIL MEMBER ED POLLARD IN THE NICK OF TIME.
WELL, GOOD MORNING, MADAM CHAIR AND MEMBERS OF COUNCIL AND STAFF.
I'M PLEASED TO PRESENT THE MERLEY FINANCIAL REPORT FOR THE PERIOD ENDING DECEMBER 31ST, 2024, AS WELL AS THE QUARTERLY INVESTMENT REPORT.
THE CONTROLLER'S OFFICE IS REJECTING AN ENDING FUND BALANCE OF 348.9 MILLION FOR FY 25.
THIS IS 17.6 MILLION LOWER THAN THE PROJECTION OF THE FINANCE DEPARTMENT.
THE DIFFERENCE DUE TO THE LOWER REVENUE PROJECTION THAN THAT OF THE FINANCE DEPARTMENT, BASED ON OUR CURRENT PROJECTION, THE FUND BALANCE WILL BE APPROXIMATELY 159.
SORRY, VERNON, IT'S A LITTLE HARD TO HEAR YOU.
ARE Y'ALL GETTING THAT KIND OF FEEDBACK? CAN I, IT'S LIKE A FEEDBACK.
HOW ABOUT NOW? IS IT BETTER? YES.
LOOK, PUT THOUGHT IT WAS JUST ME, BUT I'M GLAD IT WAS.
ALRIGHT, AND WELCOME COUNCIL MEMBER JULIAN RAMIREZ AND COUNCIL MEMBER WILLIE DAVIS.
OKAY, I'M GONNA RETRACK BASED ON OUR CURRENT PROJECTION, THE FUND BALANCE WILL BE APPROXIMATELY 159.4 MILLION ABOVE THE CITY'S TARGET OF HOLDING FIVE 7.5% OF TOTAL EXPENDITURE, EXCLUDING DEBT SERVING AND PAID REGO RESERVE.
WE HAVE INCREASED OUR REVENUE PROJECTION BY 4.7 MILLION FROM NOVEMBER, 2024 REPORT DUE TO REALLOCATION OF OPERA FUNDS FOR RESERVE REPLACEMENT PURPOSES.
OUR EXPENDITURE PROJECTION REMAIN UNCHANGED FROM THE NOVEMBER, 2024 REPORT.
MOVING TO THE CITY ENTERPRISE FUNDS IN THE COMBINED UTILITY SYSTEM FUND, NONE OPERATING REVENUES INCREASED BY 12.6 MILLION DUE TO HIGHER IMPACT FEES.
OPERATING EXPENSES INCREASED BY 4.6 MILLION, MAINLY DUE TO HIGH REPAIR COSTS FOR THE LAKE LI DAM.
AND INFRASTRUCTURE AND MAINTENANCE SERVICE CALLS FOR SINKHOLE REPAIRS OFFSITE BY PERSONAL SAVINGS IN THE DEDICATED DRAINAGE IN STREET RENEWAL FUND.
ADV ARIAN TAX EXPENDITURE DECREASED BY 3.8 MILLION DUE TO PERSONAL SAVINGS.
WE ARE PROJECTING NO CHANGE FROM THE PREVIOUS MUD AMOUNTS IN THE AVIATION OPERATING FUND CONVENTION, ENTERTAINMENT OPERATING FUND, THE STORM WATER FUND, AND OTHER DEDICATED AND DRAINAGE AND STREET RENEWAL FUND.
THE CITY PRACTICE HAS BEEN TO MAINTAIN NO MORE THAN 20% OF THE TOTAL OUTSTANDING DEBT FOR EACH TYPE OF DEBT IN THE VARIABLE RATE STRUCTURE AS A DECEMBER 31ST, 2024, ALL BELOW THE 20%.
MOVING ON TO OUR QUARTERLY INVESTMENT REPORT.
AS A DECEMBER 31ST, 2024, THE CITY HAD $5.4 BILLION INVESTED IN OUR GENERAL INVESTMENT POOL.
FISH RATING, REV REVIEW THE POOL, AND ASSIGN ITS HIGHEST RATING AAA.
AND FOR THE CITY INVESTMENTS, THE CITY INVESTMENTS ARE 15 MILLION HIGHER THAN LAST YEAR.
THIS IS PRIMARY ATTRIBUTE TO FEDERAL GRANTS FOR A NATIONAL DISASTER IN THE GRANT FUND.
AS A DECEMBER 31ST, 2024, THE GENERAL INVESTMENT POOL WAS YIELDING 3.815%, WHICH IS UP FROM 3.738% YIELD IN PRIOR QUARTER.
IN ADDITION TO THE GENERAL INVESTMENT POOL, WE HAVE TWO SMALL INVESTMENT POOL, THAT TOTAL AMOUNT OF 16 MILLION.
THOSE POOL EXISTS TO COMPLY WITH A TAX REQUIREMENT OF THE FEDERAL GOVERNMENT.
A DETAILED LISTING OF ALL SECURITIES OWNED BY THE CITY.
IT APPEARS AT THE BACK OF YOUR INVESTMENT REPORT.
ALONG WITH OUR INVESTMENT REPORT, WE HAVE INCLUDED A QUARTERLY SWAP REPORT AS REQUIRED BY THE CITY SWAP POLICY.
THE CITY HAS A NEGATIVE RECEIPT OF 12 MONTH PERIOD ENDING DECEMBER 31ST, 2024 FROM A SWAP OF 4.4 MILLION.
THE FAIR VALUE OF THE SWAP AS OF
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DECEMBER 31ST, 2024, WAS A NEGATIVE 58.4 MILLION, WHICH IS 36.29 MILLION LESS THAN LAST QUARTER.THE FAIR VALUE OF THESE SWAPS ARE VERY COMPLICATED.
SO IF YOU HAVE ANY QUESTION, PLEASE DO NOT HESITATE TO CONTACT THE COMP CONTROLLER'S OFFICE AND THAT WILL INCLUDE MY REPORT.
THANK YOU AND THANK YOU VERY MUCH, MR. LEWIS.
THIS IS THE SIX PLUS SIX FINANCIAL REPORT FOR THE PERIOD ENDING DECEMBER 31ST, 2024.
FISCAL YEAR 25 PROJECTIONS ARE BASED ON SIX MONTHS OF ACTUALS AND SIX MONTHS OF PROJECTIONS FOR THE GENERAL FUND.
OUR REVENUE PROJECTION IS $11 MILLION LOWER THAN THE ADOPTED BUDGET, BUT 4.7 MILLION HIGHER THAN THE PRIOR MONTH.
THE VARIANCE FROM THE PRIOR MONTH'S PROJECTION IS DUE TO AN INCREASE IN INTERGOVERNMENTAL REVENUES TO REFLECT THE UTILIZATION OF UNALLOCATED ARPA FUNDS FOR REVENUE REPLACEMENT, TOUCHING ON SALES TAX.
WE'RE NOT MAKING ANY CHANGES TO THE SALES TAX PROJECTIONS FOR THIS MONTH, BUT JUST TO GIVE YOU AN UPDATE, THE SALES TAX RECEIPTS FOR THE MONTH OF NOVEMBER WERE 71 MILLION, WHICH IS ABOUT 1% LOWER THAN THE PRIOR YEAR, BUT IS STILL ABOUT 0.7% HIGHER THAN WE BUDGETED FOR TO MEET THE CURRENT ESTIMATE OF 893 MILLION.
THE REMAINING PERIODS NEED TO COME IN ABOUT 0.7 0.7% ABOVE THE PRIOR YEAR.
SO WE'RE STILL TRACKING ON THAT ESTIMATE, BUT WE'LL CONTINUE TO MONITOR THAT MONTHLY.
ON THE EXPENDITURE SIDE, OUR EXPENDITURE PROJECTION IS 3.9 MILLION LOWER THAN THE ADOPTED BUDGET AND REMAINS UNCHANGED FROM THE PRIOR MONTH.
WE'RE CURRENTLY PROJECTING THE ENDING FUND BALANCE OF $366.5 MILLION, WHICH IS 4.7 MILLION HIGHER THAN THE PRIOR MONTH, AND REPRESENTS FOUR 14.5% OF EXPENDITURES, LESS DEBT SERVICE AND PAY AS YOU GO.
THAT FUND BALANCE IS 177 MILLION ABOVE THE TARGET OF HOLDING SEVEN POINT A HALF, UH, PERCENT OF EXPENDITURES EXCLUDING DEBT SERVICE AND PAY AS YOU GO.
MOVING ON TO THE ENTERPRISE SPECIAL REVENUE AND OTHER FUNDS WE'RE PROJECTING THE FOLLOWING FORECAST CHANGES FOR THOSE FUNDS FOR THE COMBINED UTILITY SYSTEM.
NON-OPERATING REVENUES INCREASE BY 12.6 MILLION DUE OR DUE TO HIGHER THAN ANTICIPATED IMPACT FEES.
OPERATING EXPENDITURES INCREASED BY 4.6 MILLION, PRIMARILY DUE TO THE EMERGENCY REPAIRS AT THE LAKE LIVINGSTON DAM AND OTHER ANTICIPATED COSTS.
UH, OTHER UNANTICIPATED COSTS AND WHICH IS PARTIALLY OFFSET BY PERSONNEL SAVINGS.
OPERATING TRANSFERS DECREASED BY 8.8 MILLION DUE TO LOWER THAN ANTICIPATED DEBT PAYMENTS.
UM, MOVING ON TO THE DEDICATED DRAINAGE AND STREET RENEWAL FUND, METRO EXPENDITURES DECREASED BY 3.8 MILLION DUE TO PERSONNEL SAVINGS AND THE HEALTH BENEFITS FUND.
NON-OPERATING REVENUES INCREASE BY 900,000 DUE TO HIGHER THAN ANTICIPATED INTEREST ON POOLED INVESTMENTS FOR THE WORKERS' COMPENSATION FUND.
OPERATING REVENUES AND EXPENDITURES DECREASED BY 1.5 MILLION DUE TO SAVINGS AND PERSONNEL AND SERVICES, AS WELL AS LOWER THAN ANTICIPATED CLAIMS. IN THE ASSET FORFEITURE FUND REVENUES INCREASED BY 2 MILLION DUE TO HIGHER THAN ANTICIPATED CONFISCATIONS, AND THE RECYCLING REVENUE FUND REVENUES INCREASED BY 620,000 DUE TO HIGHER THAN ANTICIPATED SALE OF RECYCLABLE MATERIALS.
SINCE IT'S THE QUARTERLY REPORT, I'LL GIVE A BRIEF UPDATE ON THE ECONOMY, UH, FOR THE EMPLOYMENT.
ACCORDING TO THE BUREAU OF LABOR STATISTICS, THE PRELIMINARY TOTAL NON-FARM EMPLOYMENT FOR OUR MSA, UH, WAS UP APPROXIMATELY 0.6% COMPARED TO THE PRIOR MONTH.
AND WHEN COMPARING TO THE SAME PERIOD LAST YEAR, UH, THE NON-FARM EMPLOYMENT IS UP BY 2.7%.
PRELIMINARY UNEMPLOYMENT RATE FOR OUR AREA FOR THE MONTH OF NOVEMBER WAS 4.5% AND REMAINS, UM, FLAT TO THE PRIOR MONTH FOR ENERGY.
THE AVERAGE OIL PRICE OF $70 PER BARREL FOR THE MONTH OF DECEMBER, UH, WAS FLAT COMPARED TO THE PRIOR MONTH'S AVERAGE.
AND COMPARING TO THE SAME PERIOD LAST YEAR, THE PRICE IS SLIGHTLY DOWN BY ABOUT 2.5% FOR HOME SALES.
THE LATEST REPORT, UM, PREPARED BY THE HOUSTON ASSOCIATION OF REALTORS FOR THE MONTH OF DECEMBER SHOWS THAT THE SINGLE FAMILY HOME SALES WAS ABOUT 16% HIGHER THAN THE SAME PERIOD LAST YEAR, UM, FOR THE DISASTER AS WE'VE BEEN INCLUDING, UH, IN THE MOST, UH, LAST COUPLE MONTHS.
IN THE PRINTED, UH, MONTHLY FINANCIAL REPORT, ON PAGE 13 OF YOUR REPORT, YOU'LL SEE THE SUMMARY OF THE DISASTER COST.
AS OF DECEMBER 31ST, WE HAVE PAID $89.4 MILLION IN INVOICES RELATED TO DEBRIS REMOVAL, AND WE HAVE ALSO RECEIVED ABOUT 87.6 MILLION IN FUNDING, WHICH INCLUDES 65 MILLION OF THAT BEING FEMA FUNDING AND 22.7 MILLION IN STATE REIMBURSEMENT, UM, THROUGH THE PROGRAM THAT, UH, THE ADMINISTRATION NEGOTIATED WITH THE GOVERNOR AND THE STATE LEADERSHIP.
UM, SINCE THE TIME OF THE REPORT, AGAIN, THIS IS SNAPSHOT AS OF DECEMBER 31ST.
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SINCE THAT TIME, UH, THROUGH THE END OF JANUARY, UH, WE HAVE RECEIVED AN ADDITIONAL $12 MILLION IN FUNDING FROM THE STATE, WHICH YOU'LL RECEIVE REFLECTED IN THE NEXT MONTHLY REPORT.AND I DID WANT TO, UM, TO TOUCH BASE ON THE, UM, DRAINAGE LITIGATION.
UM, MANY OF YOU MAY HAVE, UM, HEARD OR SEEN THAT UPDATE ON, UH, FRIDAY.
UM, SO JUST TO GIVE A LITTLE BIT OF BACKGROUND ON THAT LITIGATION.
SO, UM, PUBLIC SAFETY AND INFRASTRUCTURE WERE THE MAIN ITEMS ON THE PLATFORM, UH, WHEN THE MAYOR DID RUN, UM, FOR, UH, IN HIS CAMPAIGN AND FINANCE HAS BEEN AWARE AND TRACKING THAT LAWSUIT AND LITIGATION CLOSELY.
WE'VE BEEN TRACKING IT SINCE, UH, IT WAS FILED BACK IN 2019.
UH, SO WE'VE ALWAYS KNOWN THAT THAT LAWSUIT HAD THE POTENTIAL TO IMPACT THE BUDGET IN A SUBSTANTIAL WAY.
UM, SO THAT'S WHY EARLY ON LAST YEAR, WE STARTED COLLABORATING WITH OTHER LEVELS OF GOVERNMENT LIKE METRO, UM, AND ALL OTHER AREAS OF GOVERNMENT.
AND THROUGH THAT COLLABORATION HAVE ALREADY REALIZED $50 MILLION OF RECURRING REVENUES, UM, THAT WE'VE BEEN REFLECTING IN THE MOFA REPORT THE LAST COUPLE MONTHS THAT ARE ALREADY WORKING TO OFFSET, UM, COSTS THAT USED TO BE BORN BY THE GENERAL FUND.
SO WE'RE GONNA BE CONTINUING ON WITH THAT COLLABORATION WITH METRO AND OTHER LEVELS OF GOVERNMENT AS WE ARE IN THE LEGISLATIVE SESSION AS WE MOVE TOWARDS THE FY 26 BUDGET AHEAD.
UM, SEPARATELY, AS YOU'RE AWARE, WE'VE BEEN TALKING ABOUT THE ERNST AND YOUNG CITYWIDE EFFICIENCY STUDY, UM, AND THAT STUDY WAS, IS GONNA BE PRESENTED TO CITY COUNCIL IN THE NEXT COMING WEEKS AS PART OF A, AS PART OF A CITY COUNCIL SESSION.
SO THAT STUDY, UM, AS YOU KNOW, WE'VE BEEN TALKING ABOUT, UM, IT'S BEEN IDENTIFYING THE AREAS WHERE WE CAN FIND MORE EFFICIENCIES, OPERATIONS FOR SYNERGIES AND COLLABORATION AMONG DEPARTMENTS AND RECOMMENDATIONS FOR IMPROVED PERFORMANCE.
AS WE PREPARE FOR THE FY 26 BUDGET, WE'RE GOING TO CONTINUE TO EXAMINE ALL OF THE CITY OPERATIONS TO REALIZE THOSE COST SAVINGS.
THANK YOU VERY MUCH AND THANKS FOR JUST HITTING THAT HEAD ON.
'CAUSE YOU KNOW, WE'RE ALL, UM, WONDERING ABOUT IT SINCE FRIDAY.
UM, ON THE, ON THE, I'M LOOKING AT PAGE 20, UH, OF THE MOER, WHICH, WHICH TALKS ABOUT THE D-D-S-R-F, WHICH, UM, BASICALLY WHAT WE'RE TALKING ABOUT IN THIS LAWSUIT IS THE 11.80 CENTS PROPERTY TAX REVENUE, WHICH YOU HAVE PROJECTED AT 231,992,000 LESS DEBT SERVICE OF 96.4 MILLION GIVES US 135 MILLION FOR TRANSFER TO CAPITAL PROJECTS.
SO ESSENTIALLY WHAT THE LAWSUIT WITH, WITH THE CHANGE, UM, AND IN HONOR, WELL FIRST LET ME BE CLEAR.
ARE WE, IS THIS THE END OF THE ROAD? ARE WE ACCEPTING THIS, UM, OR ARE WE CHALLENGING IN ANY WAY? UM, THIS, THIS, THIS DENIAL, IT'S NOT LIKE A RULING HAPPENED, BUT A DENIAL BASICALLY AFFIRMED THE LOWER COURT'S OR THE APPEALS COURT'S RULING IS THIS, AND THAT'S, I KNOW THAT'S PROBABLY MORE OF A LEGAL QUESTION.
I THINK IT'S MORE OF A LEGAL QUESTION.
I'M NOT VERSED IN ALL THE LITIGATION.
YOU DON'T HAVE TO BE, BUT BASICALLY, IF WE WERE TO ADJUST THE 11.80 CENTS TO NOT BE JUST THE EQUIVALENT, BUT TO ACTUALLY BE THE 11 POINT CENT 8 CENTS, IT WOULD BE APPROXIMATELY AN ADDITIONAL A HUNDRED MILLION DOLLARS TO THAT $230 MILLION DOLLAR NUMBER.
AND WHEN YOU TALKED ABOUT THE 50 MILLION THAT'S ALREADY BEEN IDENTIFIED, THAT'S THE STREETLIGHTS AND THE TRAFFIC ENFORCEMENT FROM METRO, CORRECT? YES.
AND THAT COMES DIRECTLY FROM METRO GENERAL MOBILITY MONEY.
WHICH IS THE QUARTER PENNY THAT THEY GET IN SALES TAX.
UM, GRATEFUL FOR THAT MONEY AND UNDERSTAND THAT THAT WILL OFFSET IT, BUT IT'S NOT EXACTLY A, UM, A A, UM, IT, IT'S NOT EXACTLY COMING FROM THE, THE A VALOREM LIKE THIS WILL HAVE TO CORRECT.
SO THE $50 MILLION FROM METRO DOESN'T, DOESN'T NOW MAKE OUR OUR LIABILITY 50 MILLION DOES IT? OR, OR WELL, BUT THE 50 MILLION THAT'S COMING FROM METRO PAYING FOR THE HPD TRAFFIC ENFORCEMENT DIVISION FREES UP SOME GENERAL FUND WAS RIGHT.
THAT WAS PAID FOR GENERAL FUND PREVIOUSLY.
SO YOU COULD TAKE THAT GENERAL FUND SPECIFICALLY FROM THE ADVIL ARM PORTION AND KNOCK THAT DOWN, SO, CORRECT.
SO BASICALLY WE'RE LOOKING AT JUST 50 MILLION THAT WE HAVE TO, IF YOU'RE LOOKING AT THOSE, UH, EXPENDITURES IN THAT FUNDING STREAM.
AND, AND YOU SAID THE EY STUDY IS COMING IN, COMING WEEKS, DO YOU KNOW, COMING WEEK, TOMORROW, WEDNESDAY,
THAT WE NEED TO START IMPLEMENTING THOSE RECOMMENDATIONS IN THAT REPORT, SO SOONER RATHER THAN LATER.
AND ONE MORE, UH, YOU SAID WE'RE GETTING 12 MORE, 12 MILLION MORE FOR THE STATE ON, ON BARRELL AND DERECHO AND WE'VE GOTTEN ABOUT 22 MILLION
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ALREADY.AND THAT WILL PROBABLY BE IT ON THE, FROM THE STATE ON THE DEBRIS CLEANUP, WE'RE NEARLY AT 99% OF INVOICES PAID AND RECEIVED.
AND, UH, GOOD MORNING TO EVERYONE.
THANK YOU BOTH FOR YOUR PRESENTATIONS DIRECTOR.
I HAVE A SERIES OF QUESTIONS, UM, TO DIVE A LITTLE DEEPER INTO THE DRAINAGE LITIGATION.
UM, WE'VE TALKS BEHIND THE SCENES.
IS THAT SOMETHING THAT, UH, WE ARE PROJECTING TO HAVE TO SOLIDIFY AND, AND PAY WITHIN THE NEXT FISCAL YEAR? OR IS THERE DISCUSSIONS WITHIN LEGAL AND THE THIRD PARTY ON MITIGATING THAT IN SOME WAY? YES, WE'RE DEFINITELY GONNA BE SEEK TO MI MITIGATING FOR SURE.
AND REGARDING, UM, TOPICS THAT WE'VE BEEN HEARING IN THE NEWS LATELY, UH, AS IT RELATES TO WATER, UM, HAVE THERE BEEN ANY DISCUSSIONS FROM A FINANCIAL STANDPOINT ON THE SALE OF WATER AND HOW THAT COULD IMPACT HOUSTON? I HAVEN'T HAD ANY DETAILED DISCUSSIONS ON THAT POINT.
I DO KNOW THAT'S SOMETHING THAT I'VE HEARD THE LEGISLATURE AND THE GOVERNOR TALKING ABOUT IN THE MEDIA.
AND, AND REGARDING, UM, UM, THE MAYOR'S, UH, PROJECTION ON, UH, HOMELESS POLICY, I KNOW THERE HAS BEEN STATED NUMBERS OF ABOUT $70 MILLION, UH, THAT WOULD BE NEEDED FOR THAT STRATEGY.
HAS THERE BEEN ANY, UM, PLANS OR DISCUSSIONS WITHIN THE FINANCE DEPARTMENT ON HOW TO, UH, PAY FOR THAT? IT'S MY UNDERSTANDING ON THE HOMELESS, UM, INITIATIVE THAT THE MAJORITY OF THE FUNDING WILL COME THROUGH, UM, COLLABORATION WITH OTHER LEVELS OF GOVERNMENT, UH, PHILANTHROPIC.
UM, SO THAT'S THE, THAT'S THE PLAN AT THIS POINT.
UM, I KNOW THAT WE ARE OF COURSE LOOKING AND, UH, LOOKING IN OUR RESOURCES TO SEE, UM, YOU KNOW, WHAT IT COULD BE THAT WE COULD USE TO LEVERAGE OTHER OUTSIDE FUNDING SOURCES, BUT THE MAJORITY IS, UM, GONNA COME FROM OUTSIDE ENTITIES.
SO AS IT RELATES TO THE CITY'S, UH, RESOURCES, DO WE ANTICIPATE ANY ADDITIONAL REVENUE, UM, IN THE SHORT TERM, ANY ADDITIONAL REVENUE SOURCES THAT, THAT WE'VE IDENTIFIED IN THE SHORT TERM TO HELP WITH THIS ANTICIPATED SHORTFALL? RIGHT.
SO, UM, I THINK THAT SPEAKS TO THE ONGOING COLLABORATION WE'RE DOING WITH METRO AND OUR OTHER STAKEHOLDERS, AND OF COURSE ENGAGING WITH THE LEADERSHIP IN AUSTIN AS WE'RE IN THE LEGISLATIVE SESSION.
BUT, UM, NOTHING THAT WE'RE READY TO REPORT AT THIS POINT.
AND HOW WOULD THE, I THINK THE MM-HMM
SO THE FOCUS ON, UM, BRINGING IN REVENUE, OF COURSE, THAT'S DEFINITELY PART OF THE SOLUTION.
UM, BUT THE OTHER PART THAT WE ARE, UM, MOVING FORWARD WITH SOONER RATHER THAN LATER IS THE, UH, THE EFFICIENCIES, THE ERNST AND YOUNG REPORT COST SAVINGS AND HOW WE CAN FIND SOME COST SAVINGS.
AND REAL QUICK, 'CAUSE I'M, I'M TRYING TO MAKE IT WITHIN MY TIME, BUT, UM, THESE PROPOSED TARIFFS FROM THE, UH, FROM THE NATIONAL LEVEL, DO THEY HAVE ANY IMPACT ON HERE AT LOCAL GOVERNMENT FROM A FINANCE STANDPOINT AT ALL? NOT THAT WE, UM, NOT THAT WE SEE BECAUSE THAT'S AT THE FEDERAL LEVEL.
AND LASTLY, UH, WHEN WILL WE ANTICIPATE RECEIVING, UH, THE PROPOSED FISCAL YEAR 26 BUDGET TO REVIEW MM-HMM
WHAT MONTH IN MAY? MAY, MM-HMM
A WEEK EARLIER THAN USUAL, AS PER PROMISE.
UH, TO OUR DIRECTOR FINANCE QUESTION.
YOU KNOW, WE HAD A CONVERSATION ABOUT, UM, THE, DURING THE COVID FUNDS WE WERE SHORT, THAT HAD NOT COME FROM THE FEDERAL GOVERNMENT, LIKE 1.3 MILLION, I BELIEVE IT WAS SOMEWHERE IN THAT.
IS THAT WHEN WE TALKED, WHEN I REQUESTED? UM, SO FOR THE FEDERAL FUNDING FROM COVID, UM, THE REMAINING FUNDING THAT WE HAVE FROM THE FEDERAL GOVERNMENT IS ON THE, UH, THAT IMPACTS THE GENERAL FUND IS THE ARPA GRANT.
UM, SO THAT WAS ONE THAT WE HAVE ALREADY RECEIVED ALL OF THAT FUNDING FROM THE FEDERAL GOVERNMENT, THAT GRANT IS NOT REIMBURSEMENT BASED.
SO ON THAT ONE, WE HAVE EVERYTHING, OUR FULL ALLOCATION ON THAT.
SO WHEN THAT REPORT, WHEN IT WAS, IT CAME OUT, IT WAS LIKE A MILLION SHORT THAT THEY, WE HAD NOT RECEIVED AT THE TIME WHEN WE WERE DISCUSSING.
I THINK WHAT WE WERE DISCUSSING, UM, IF I RECALL, WAS ON THE FEMA, ON THE HARVEY.
THE, UH, FROM THE HARVEY DISASTER.
UM, AND SO WITH THAT, THE FEMA PROGRAM IS ONE THAT IS A REIMBURSEMENT BASED PROGRAM.
SO WE HAVE TO SPEND IT AND THEN SEEK REIMBURSEMENT, YOU KNOW, FOLLOWING ALL THE LONG FEDERAL GUIDELINES AND REQUIREMENTS, UM, WHICH WE, UH, VERY CLOSELY TRACK.
WE ENGAGE WITH LEGAL PROCUREMENT TO
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MAKE SURE THAT WE'RE FOLLOWING ALL THOSE GUIDELINES.UM, AND I WOULD SAY ONE THING, I KNOW THAT, UH, AS YOU MENTIONED, THERE ARE THINGS THAT WE'VE BEEN WAITING FOR.
WE'VE HAD QUITE A NUMBER OF OBLIGATIONS, BUT ANYTHING THAT WE'RE WAITING FOR FROM THE FEDERAL GOVERNMENT FOR FEMA IS BASED ON US NEEDING TO, YOU KNOW, SINCE THE REIMBURSEMENT BASE, SPEND IT FIRST AND THEN SUBMIT TO THEM.
UM, SO THERE'S REALLY, UM, NOT A HOLD UP RIGHT NOW WITH GETTING THOSE REIMBURSEMENTS BACK.
AND AS YOU SAW WITH THE, WITH THE DERECHO AND THE BARREL, YOU KNOW, WE WERE ABLE TO COLLABORATE WITH THE STATE OKAY.
ON, UM, YOU KNOW, GETTING THAT PROCESS ROLLING AND THANK YOU TO THE CONTROLLER'S OFFICE.
'CAUSE THERE WAS A LOT OF QUICK TURNAROUND TIME ON PAYING THOSE INVOICES TIMELY TO ENSURE THAT WE COULD GET THAT CASH FLOW COMING FROM THE STATE.
SO IF WE MAKE A REQUEST, IS THERE A REQUEST FOR OUR, THOSE REIMBURSEMENTS SINCE WE, WE SPENT THE MONEY, WHICH WAS HOW WE PART OF OUR DEBT, YOU KNOW, UH, LINE ITEM DEBT, IS THERE BEEN A REQUEST MADE THAT YOU KNOW OF, I KNOW IT WAS A TRANSITION OF ADMINISTRATION, BUT IS THERE A REQUESTS OUT THERE NOW ON THE FEMA, ON THE HARVEY HARVEY RECOVERY ON, YEAH.
SO WE HAVE SOME PROJECT WORKSHEETS WHERE THEY ARE, UM, REQUESTED AND THEY'RE OBLIGATED, BUT LIKE I MENTIONED, WE HAVE TO SPEND THE DOLLARS FIRST TO SEEK REIMBURSEMENT.
SO THAT WOULD BE THE CASE IN SOME OF OUR LARGER CAPITAL RECOVERY PROJECTS LIKE THE COURTHOUSE, FOR EXAMPLE, WHERE FEMA HAS APPROVED OUR PROJECT WORKSHEET, THEY'VE OBLIGATED THE FUNDS.
WE HAVEN'T DRAWN THEM DOWN YET, BUT ONLY BECAUSE WE HAVEN'T COMPLETED THE CONSTRUCTION PROJECT YET TO DRAW THE FUNDING DOWN.
SO I WOULD SAY IT'S MORE OF A, A TIMING, UM, OKAY.
UM, BUT WE DO, UM, WE HAVE A GOOD WORKING RELATIONSHIP IN COLLABORATION WITH, WITH FEMA AND TEDOM TO DRAW THOSE FUNDS DOWN.
UH, MY QUESTION IS, UH, SOMEWHERE SOMEWHAT ALONG THOSE LINES, PARTICULARLY RELATED TO THE FEDERAL FREEZE.
I'M MORE INTERESTED IN HUD, UM, THOSE C-D-B-G-D-R FUNDS THAT WE'VE RECEIVED.
UM, THAT'S REIMBURSABLE AS WELL.
UH, WE HAVE DR 17, WHICH IS HARVEY.
21, WHICH IS WINTER FREEZE FROM 2021.
AND THEN WE ARE ANTICIPATING D 24.
UM, UM, IS YOUR OFFICE AWARE OF ANY GUIDANCE FROM THE FEDERAL GOVERNMENT? BECAUSE MANY OF THOSE NONPROFITS THAT WE ARE UNDER CONTRACT WITH TO ISSUE THIS WORK, UM, THEY'VE DONE THE WORK AND WE'RE UNABLE TO MOVE FORWARD WITH THAT BECAUSE OF THE FREEZE.
SO ALTHOUGH THE MEMO FROM OOMB WAS RESCINDED, THE DIRECTIVE WAS NOT.
SO IS YOUR OFFICE, UM, AWARE OF ANY, UH, NEW GUIDANCE? SO I DON'T THINK I'VE SEEN ANY NEW GUIDANCE SINCE LAST WEEK SINCE THE MEMO WAS RESCINDED.
UM, WE ARE WORKING WITH THE LEGAL DEPARTMENT, UM, AND OF COURSE IN CLOSE CONTACT WITH THE HOUSING DIRECTOR NICHOLS AS WELL.
UM, BECAUSE AS YOU MENTIONED, THAT WAS DEFINITELY LISTED ON THE, WHEN OMB PUT OUT THE, THE MEMO, THE GUIDANCE OF ALL THE FEDERAL AGENCIES AND ALL THE GRANTS TO EXAMINE THE C-D-B-G-D-R WAS, WAS ON IT.
UM, AND SO WE'RE WORKING WITH LEGAL AND HOUSING TO FULLY UNDERSTAND WHAT'S HAPPENING NOW THAT THE MEMO WAS OUT, YOU KNOW, BUT THEN RESCINDED.
SO IF I COULD, SO, SO DIRECTOR, AND THIS MAY, I'M SORRY, MADAM CHAIR, AND IF, UH, MADAM CHAIR, IF YOU CAN JUST ADD TO THE LIST AS A FOLLOW UP, UM, TO SEE IF, IF THAT, IF THE FREEZE, UM, COUNCIL OUR TIMELINE RIGHT, YOU KNOW, THOSE FEDERAL TIMELINES IN ORDER TO SPEND THAT DOWN, IF WE CAN JUST, IF YOUR, IF YOUR TEAM CAN, UM, UH, WORK WITH US TO KIND OF TRACK THAT DOWN, THAT WOULD BE HELPFUL.
UM, THANK YOU BOTH FOR YOUR REPORT.
UH, DIRECTOR, UM, I, I GUESS FOR ME, AND THIS IS THE NUMBERS THAT PEOPLE NEEDED HERE, RIGHT? WHAT WERE, WHAT WAS THE ANTICIPATED DEFICIT FOR FY 26? MM-HMM
THE ANTICIPATED DEFICIT, UM, WAS AROUND 220 MILLION OKAY.
AND NOW WITH THE, WITH, AS WE, WE HEAR WITH THE DDS, UM, UH, SR, UM, THE A HUNDRED MILLION IS LOOKING LIKE METRO WILL BE ABLE TO, UM, HELP SUPPLE OR SAVE 50 MILLION FROM THE GENERAL FUND.
SO ADDING ANOTHER 50 MILLION TO THE TWO 20 PLUS, UM, TO 70, UM, THOSE NUMBERS ARE THE, THE NUMBERS THAT FOLKS REALLY NEED TO HEAR.
WHEN WE'RE START LOOKING AT WHAT WE'RE GONNA DO TO CLOSE OUT, CLOSE THAT, THAT GAP.
UM, I, I'M EXCITED ABOUT HEARING WHAT THIS ERNST YOUNG REPORT BRINGS TO US.
I THINK WE ALREADY KNOW WHAT SOME OF THOSE ISSUES ARE.
UM, DO YOU KNOW IF THE ADMINISTRATION'S ALREADY STARTED IMPLEMENTING ANY OF THE, THE, UM, YOU KNOW, KIND OF
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CHANGES IN OPERATIONS, UH, THAT HAVE SHIFTED TO SEE WHAT, WHAT SAVINGS WE COULD ALREADY HAVE PRIOR TO, UH, IMPLEMENTING THE, THE REPORT? SURE.UM, ONE THING THAT WE STARTED, I BELIEVE WE SENT THE COMMUNICATION OUT TO THE DEPARTMENTS LAST WEEK, IS LOOKING AT, UM, SOME CONSOLIDATION OF INFORMAL PROCUREMENT.
SO, UM, CERTAIN DEPARTMENTS HAVE ALREADY HAD THEIR PROCUREMENT FUNCTIONS CONSOLIDATED WITHIN THE STRATEGIC PURCHASING DIVISION INSIDE THE FINANCE DEPARTMENT.
UM, AND SO WE'RE LOOKING AT THE DEPARTMENTS THAT HAVE NOT BEEN CONSOLIDATED YET, UH, TO BRING THOSE, UM, MORE FULLY CONSOLIDATED IN THE FINANCE DEPARTMENT.
SO IT SOUNDS LIKE THERE'S ALREADY SOME WORK TO ADDRESS, UH, INEFFICIENCIES.
AND, AND SO THE ERN G REPORT SHOULD GIVE US EXACTLY WHERE WE ARE, UM, AFTER EVEN SOME OF THESE THINGS HAVE BEEN IMPLEMENTED.
UH, THE, THE LAST THING I WANT TO KIND OF WANNA POINT OUT IS, SO WE'RE TAKING 50 MILLION FROM METRO NOW.
UM, METRO HAS, ITS ITS SCOPE OF WORK AS WELL.
AND I THINK IF YOU JUST ASK EVERYBODY GENERALLY WHAT IS METRO SUPPOSED TO DO? IT'S SUPPOSED TO PROVIDE SOME TRANSPORTATION EQUITY ACROSS THE CITY.
UH, DO YOU KNOW WHERE THOSE DOLLARS FROM METRO ARE COMING FROM? UH, BECAUSE, YOU KNOW, WE KNOW THAT WE DON'T HAVE THE, THE, THE GREEN LINE EXTENSION, ANY OF THESE OTHER PROJECTS THAT WERE, WERE ANTICIPATED TO COME IN.
UM, DO YOU KNOW WHERE, WHERE EXACTLY METRO'S PULLING THOSE $50 MILLION FROM? SO THIS MONEY THAT WE'RE TALKING ABOUT IS PART OF THE GENERAL MOBILITY PLAN.
UM, AND THESE, THE DOLLARS THAT WE DREW DOWN WERE DOLLARS THAT METRO HAD ALREADY SET ASIDE, THAT WERE AVAILABLE TO BE DRAWN DOWN.
UM, I BELIEVE THAT THE BALANCE WAS AROUND $170 MILLION OF FUNDING THAT METRO HAD SET ASIDE ALREADY THAT THE CITY HAD NOT REQUESTED A DRAWDOWN FOR.
UM, AND SO WE PUT IN THAT REQUEST AND WE'RE ABLE TO, TO DRAW THOSE FUNDS DOWN.
SO IT WON'T IMPACT A LOT OF THE PROGRAMMING OR THE PROGRAMMING.
IT SHOULDN'T IMP UH, IMPACT THE PROGRAM AS FAR AS GETTING PEOPLE FROM PLACE TO PLACE.
THEN THE GENERAL MOBILITY, UH, PLAN, UM, WELL, I HAVE A, A LIST OF ALL THE PROJECTS THAT ARE ON THE GENERAL MOBILITY PLAN THAT THE CITY HAS.
AND I, I CAN SHARE THAT LIST WITH YOU.
YEAH, I'D APPRECIATE THAT AS WELL.
BUT, AND BASICALLY, THIS ISN'T NEW MONEY.
THIS ISN'T NEW MONEY COMING FROM METRO.
THIS IS PART OF OUR QUARTER PENNY THAT'S PART OF REBUILD.
I MEAN, METRO MONEY HAS ALWAYS BEEN PART OF THE REBUILD PROGRAM.
SO I HAVE SOME QUESTIONS ABOUT THE CHARTER AND HOW, HOW WE'RE DOING THIS TOO, BUT, BUT THOSE, UH, UH, WE'LL, WE'LL, WE'LL BE TALKING MORE ABOUT THAT.
'CAUSE ORIGINALLY I THOUGHT THAT TOO, I WAS LIKE, OKAY, 50 EXTRA MILLION DOLLARS FROM METRO.
THIS IS MONEY THAT ALREADY COMES TO PUBLIC WORKS YEARLY.
'CAUSE PART OF THAT QUARTER PENNY THAT WE'RE JUST NOW USING TO PAY FOR THE POLICE IN TRAFFIC ENFORCEMENT AND TO PAY FOR THE STREETLIGHTS, DOES THAT MEAN COUNT? DOES THAT MEAN THAT THAT MONEY WOULD'VE GONE SOMEWHERE ELSE THROUGH PUBLIC WORKS AND NOW WE'RE USING IT FOR THIS AND NOW THE MONEY THAT WOULD'VE BEEN IN PUBLIC WORKS WE HAVE TO FIND ADDITIONAL RESOURCES FOR? THAT'S MY UNDERSTANDING IS THAT BECAUSE WE USUALLY DRAW DOWN FOR METRO MOBILITY THAT QUARTER, PENNY, I MIGHT BE WRONG.
MAYBE WE DON'T DRAW THE WHOLE THING DOWN.
WE SHOULD, WE CERTAINLY HAVE THE PROJECTS FOR IT.
UM, BUT THAT'S MY UNDERSTANDING.
THIS, THIS IS MONEY THAT WE GET EVERY ANNUALLY INTO OUR REBUILD HOUSTON FUND THROUGH METRO MOBILITY AND TO CLOSE THE LOOP REAL QUICK.
THEN IF THAT'S THE CASE, THEN ESSENTIALLY WE'RE PROBABLY GONNA BE DELAYING PROJECTS BECAUSE THOSE PROJECTS ARE ALREADY IN THE QUEUE AND WE'RE GONNA BE FUNDING THIS, THESE DOLLARS TO PAY PROJECTS THAT ARE ALREADY WELL, WHAT METRO, WHAT METRO RELAYED TO THE CITY IS THAT THEY HAD $170 MILLION SET ASIDE FOR THE CITY AVAILABLE TO BE DRAWN DOWN.
UM, AND SO WE IDENTIFIED AND WORKED WITH THEM ON THE LIST OF PROJECTS IN THE GENERAL MOBILITY PLAN, UH, TO DRAW THAT FUND FUNDING DOWN, UH, FOR THE IMMEDIATE USE FOR THE ELECTRICITY, THE TRAFFIC LIGHTS, AND THE HPD TRAFFIC ENFORCEMENT.
AND SO COUNCIL MEMBER POLLARD.
SO WILL THAT MONEY THEN BE, UM, AVAILABLE FOR REOCCURRING YEARS? YES.
AND SO I GUESS THE SUBJECT TO THE AGREEMENT OF THE PROJECT LIST ON THE GENERAL MOBILITY PLAN, WHICH THE CITY AND METRO AGREE ON ANNUALLY.
SO WHERE WERE THOSE DOLLARS GOING? BUT FOR THE METRO AGREEMENT? I, BUT FOR THE METRO AGREEMENT, THE COST FOR THE TRAFFIC LIGHTS AND THE ELECTRICITY WAS BEING PAID OUTTA THE GENERAL FUND.
BUT FROM, I'M TALKING ABOUT FOR METRO ON FROM METRO STANDPOINT, THEY WERE SITTING IN A BANK WAITING TO BE DRAWN DOWN BY THE CITY.
I, I THINK WHAT YOU'RE SAYING IS IN THE PAST WE KNOW WHAT WE USUALLY USE METRO MOBILITY.
I MEAN WE, WE, WE APPROVE IT ALL THE TIME.
YOU SEE IT ON THE AGENDAS ALL THE TIME.
EVERYTHING FROM TRAFFIC TO SIGNALIZATION.
WE'VE DONE TRAILS, WE'VE DONE THINGS THAT THE A VALOREM AND DRAINAGE FEE CAN'T PAY FOR, UM, METRO PAY FOR.
SO WE WOULD'VE DRAWN DOWN ON IT IN IT'S PART OF REBUILD IN THE METRO HAS ALWAYS THAT METRO GENERAL MOBILITY MONEY IS BY CHARTER PART OF THE REBUILD HOUSTON PROGRAM.
SO ALL, I THINK WE'RE ALL, I THINK THAT THE
[00:30:01]
QUESTION IS, AND MAYBE WE JUST NEED TO KNOW THAT IF THIS IS, UM, THIS METRO, THIS 50 MILLION, IF IT'S, IF WE'RE USING IT FOR TRAFFIC ENFORCEMENT AND STREETLIGHTS, WHAT ARE WE NOT USING IT FOR? IS THAT, AND THAT'S MAYBE WHAT A PUBLIC WORKS QUESTION THAT WE COULD SAY THEY'RE SHIFTING THEIR FOCUS FROM.FROM THAT, FROM THIS TO NOW THIS, WE'VE, WE'VE HAD CONVERSATIONS WITH METRO AND WE'RE STILL WORKING WITH THEM ON PROJECTS THAT WERE, UH, COULD HAVE BEEN PLANNED TO BE FUNDED FROM GENERAL ABILITY ASKING METRO TO TAKE THOSE PROJECTS ON OUTSIDE OF THE CITIES.
GOT, AND I HAVE HEARD THAT TOO, MOBILITY THAT THE METRO IS SPENDING ITS OWN FUNDING NOW ON SOME ROAD PROJECTS AND STUFF THAT WOULD'VE GONE, POSSIBLY BEEN USED FOR METRO MOBILITY.
I THINK WHAT THE COUNCIL IS GONNA NEED IS, IS, IS SOME KIND OF, YOU KNOW, LET'S SEE HOW THAT'S WORKING.
I KNOW METRO IS, I MEAN CERTAINLY I SEE IT EVERY DAY ON, ON WESTHEIMER THEY'RE SPENDING THEIR MM-HMM
YOU KNOW, A SEPARATE PART OF MONEY, NOT, NOT GENERAL MOBILITY MONEY, NOT MOBILITY.
SO IT MIGHT, YOU KNOW, BE A WASH, BUT I THINK WE JUST NEED TO SEE, UM, OR HAVE A BETTER IDEA OF, OF THAT WHAT'S GOING ON THERE.
UM, AND I'M GONNA ASK, UM, MY VICE CHAIR TO COME AND THE NEXT IN THE QUEUE IS COUNCIL MEMBER RAMIREZ.
JUST TO CLOSE THE LOOP ON THAT, UH, DIRECTOR DEBOSKY.
SO METRO IS SPENDING, UH, MONEY, OTHER MONEY ON PROJECTS WITHIN THE CITY, IS THAT CORRECT? YES.
AND ARE WE ABLE TO QUANTIFY HOW MUCH THEY'RE SPENDING? UM, I CAN, WE CAN GET A REPORT PULLED TOGETHER FOR YOU.
I DON'T HAVE IT OFF THE TOP OF MY HEAD.
UM, I TO BREAK IT DOWN BETWEEN WHAT'S INSIDE THE CITY AND OUTSIDE, I'D REALLY WANNA FOLLOW UP.
SO NEXT UP, ALRIGHT, NEXT UP WE HAVE UPCOMING FINANCIAL TRANSACTIONS.
I'M GONNA PRESENT ON THE UPCOMING FINANCIAL TRANSACTIONS TODAY ON BEHALF OF THE FINANCE WORKING GROUP.
UM, TODAY WE HAVE A FEW, UM, ITEMS COVERING THE GENERAL OBLIGATION CREDIT AND THE COMBINED UTILITY SYSTEM CREDIT.
THESE ARE, UM, COMMERCIAL PAPER, UH, MOST OF THEM ARE COMMERCIAL PAPER PROGRAMS THAT ARE CURRENTLY IN PLACE, UH, THAT ARE COMING UP.
UM, THE EXPIRATION DATE OF THE CURRENT FACILITIES IS COMING UP.
AND THEN THE, UH, ONE, THERE'S ONE ITEM UNDER, UNDER THE COMBINED UTILITY SYSTEM FOR THE VARIABLE RATE DEMAND BONDS, UH, WHICH IS A, UM, SERIES OF BONDS THAT WAS ISSUED, UM, MANY YEARS AGO THAT ARE DONE IN A VARIABLE RATE MODE.
UH, SINCE THEY'RE IN A VARIABLE RATE MODE.
UH, THEY ARE SUBJECT TO THE SWAP AGREEMENTS, UM, THAT DEPUTY CONTROLLER LEWIS MENTIONED, UH, IN HIS RE IN HIS SWAP REPORT.
UM, AND THEY HAVE AN UNDERLYING CREDIT FACILITY BEHIND THEM THAT'S COMING THAT'S EXPIRING.
SO ALL THE ITEMS WE'RE GONNA TALK ABOUT TODAY ARE ITEMS THAT WE CURRENTLY HAVE IN PLACE, INSTRUMENTS WE CURRENTLY HAVE IN PLACE THAT EXPIRE EVERY SO OFTEN THAT WE HAVE TO RENEGOTIATE THE TERMS AND FIND REPLACEMENTS FOR.
SO, UM, ON SLIDE THREE, THIS GIVES YOU A SNAPSHOT OF ALL THE GENERAL OBLIGATION VARIABLE RATE EXPOSURE THAT WE HAVE.
UH, WE HAVE A SERIES OF MANY SERIES OF COMMERCIAL PAPER LINES THAT SUPPORT THE GENERAL OBLIGATION CIP.
UM, SO YOU SEE HERE THE SERIES E TWO, THE ONE THAT'S HIGHLIGHTED IS THE ONE WE'RE GONNA TALK ABOUT TODAY.
SO THIS COMMERCIAL PAPER PROGRAM SERIES E TWO, UH, WAS ORIGINALLY CREATED BACK IN 2002.
UM, IT'S OPERATED AS TWO SEPARATE PROGRAMS. SO WE TRACK SERIES E ONE AND SERIES E TWO, UH, THAT WERE COMBINED TOGETHER, UM, BY, IN UNDER ONE ORDINANCE BACK IN 2011.
SO AS YOU CAN SEE, THIS SERIES HAS BEEN IN PLACE FOR MANY YEARS SUPPORTING, UM, THE IMPLEMENTATION OF OUR CIP PROGRAM.
SO SERIES E, UM, WILL SUPPORT, YOU KNOW, ANYTHING FROM THE PURCHASE OF SOLID WASTE TRUCKS TO UM, IT NETWORK EQUIPMENT.
SO WE USUALLY USE SERIES E FOR LARGE EQUIPMENT PURCHASES THAT ARE CAPITAL IN NATURE.
SO THE FINANCE WORKING GROUP, UM, RECOMMENDED THAT, UM, WE
[00:35:01]
SEPARATELY TRACK SERIES E ONE AND E TWO, UM, BECAUSE THEY ARE, UM, AS YOU CAN SEE ON THE SLIDE BEFORE, THEY ARE SEPARATE.UH, THEY ARE SUPPORTED BY TWO DIFFERENT BANKS.
UH, SO THIS GIVES US SOME MORE, UM, UH, I WOULD SAY DIVERSITY IN OUR PORTFOLIO IN TERMS OF MAKING SURE THAT WE HAVE ALL THE CREDIT THAT, UH, THAT WE CAN GET AT THE BEST PRICE THAT WE CAN GET.
SO TODAY WE'RE FOCUSING ON THE SERIES E TWO, UM, WHICH IS A HUNDRED MILLION DOLLARS IN SIZE AND IT'S PROVIDED BY WELLS FARGO THAT, UM, BANK FACILITY IS EXPIRING ON APRIL 22ND OF THIS YEAR.
UH, SO WE ARE GOING TO ISSUE A REQUEST FOR TERM SHEETS THIS MONTH, UH, TO SEEK RENEWAL PROPOSALS FROM OUR POOL OF BANKS.
UM, AND BASED ON THOSE RENEWAL PROPOSALS, THE FINANCE WORKING GROUP WILL, UM, MAKE A COMMEND RECOMMENDATION TO BRING TO CITY COUNCIL FOR THEIR APPROVAL, UM, SOMETIME THIS SPRING BEFORE THE EXPIRATION OF THE PROGRAM.
UM, ON THE NEXT SLIDE WE'LL MOVE ON TO TALKING ABOUT THE COMBINED UTILITY SYSTEM.
UM, THIS SLIDE GIVES YOU THE OVERVIEW OF ALL OF THE COMMERCIAL PAPER PRODUCTS AND THE VARIABLE RATE DEMAND BONDS AT THE COMBINED UTILITY SYSTEM HAS.
SO WE'RE GONNA TALK ABOUT THE THREE HIGHLIGHTED ITEMS TODAY.
UM, THE FIRST ONE WE'RE GONNA DISCUSS IS ON SLIDE SIX.
UM, WE'RE GONNA TALK ABOUT THE SERIES 2018 C VARIABLE RATE DEMAND BONDS.
AS I MENTIONED, THERE ARE LONG, LONG-TERM BONDS, UH, WHICH ARE VARIABLE RATES, WHICH MEANS THEY'RE REMARKETED ON A WEEKLY BASIS TO RESET THE INTEREST RATE.
AND IN ORDER FOR THESE BONDS TO BE MARKETABLE, THESE VDBS REQUIRE A LIQUIDITY FACILITY, UH, SUPPORTING THEM IN THE BACKGROUND.
SO IT'S THIS UNDERLYING LIQUIDITY FACILITY THAT'S EXPIRING, UM, IT'S PROVIDED BY BARCLAYS BANK AND IT'S GONNA BE EXPIRING IN JULY.
SO WE ARE GETTING A LITTLE BIT OF AN EARLY HEAD START ON THIS BECAUSE WE KNOW THAT, UM, BARCLAYS HAS INDICATED THAT THEY'RE NOT ABLE TO RENEW THE PROGRAM WITH US.
SO WE'RE GOING TO BE SEEKING A REQUEST FOR TERM SHEETS, UM, FROM OUR POOL OF BANKERS, UH, THIS SPRING, AND ANTICIPATING TO BRING THE RECOMMENDATION TO COUNCIL IN JUNE BEFORE THE FACILITY EXPIRES.
ON THE NEXT SLIDE, UH, THIS IS COMMERCIAL PAPER, UH, SERIES B FOUR AGAIN FOR THE COMBINED UTILITY SYSTEM.
SO THIS COMMERCIAL PAPER SERIES SIMILAR TO THE GO SERIES E, THIS COMMERCIAL PAPER PROGRAM SUPPORTS THE CAPITAL IMPROVEMENT PLAN FOR THE COMBINED UTILITY SYSTEM, WHICH IS THE WATER AND WASTEWATER SYSTEM OF THE CITY.
SO THIS UNDERLYING FACILITY IS A HUNDRED MILLION DOLLARS IN SIZE AND IT'S PROVIDED BY PNC BANK AND IT'S EXPIRING IN JULY.
UM, SO WE ARE AWAITING RIGHT NOW ON A RENEWAL PROPOSAL FROM THE CURRENT LIQUIDITY PROVIDER.
AND DEPENDING ON THE TERMS OF THE RENEWAL, A FUTURE REQUEST FOR TERM SHEETS, UH, MAY BE MADE TO OUR POOL, IN WHICH CASE WE WOULD BRING COUNCIL ACTION, UM, SOMETIME IN THE SPRING BEFORE THE FACILITY EXPIRES IN JULY.
AND ON THE NEXT SLIDE, SERIES B SEVEN, UM, THE SIMILAR IN NATURE TO B FOUR IN THAT IT, UH, PROVIDES, UM, INTERIM SPENDING FOR THE CAPITAL IMPROVEMENT PLAN FOR THE UTILITY SYSTEM.
THIS PROGRAM IS A HUNDRED MILLION DOLLARS IN SIZE PROVIDED BY JP MORGAN AS AND IS EXPIRING IN MAY.
UM, SO WE'RE, UH, ANTICIPATING AGAIN THAT WE'RE GOING TO PUT OUT A REQUEST FOR TERM SHEETS, UM, THIS MONTH AND, UH, BRING A RECOMMENDATION TO COUNCIL FOR APPROVAL BEFORE THE EXPIRATION.
WE HAVE NO QUESTIONS, UH, OR COMMENTS FROM COUNCIL MEMBERS IN THE QUEUE.
AND SO WE ARE NOW GONNA MOVE ON TO OUR PUBLIC COMMENT.
ALRIGHT, WE HAVE TWO SPEAKERS SIGNED UP TODAY FOR PUBLIC COMMENT.
FIRST SPEAKER, DOMINIC, AK, YOU'RE UP.
I AM IN CITY COUNCIL CHAMBERS.
OKAY, THE BIG QUESTION IS 96, RED LINE 40.
GET OVER HERE FROM FORT NORTH.
SPEAKING OF METRO, I THINK THERE IS SOMETHING THAT THE MAYOR DID WITH METRO.
I THINK IT'S A VERY WISE THING HE DID WAS INNER WESTHEIMER.
THAT PROJECT IS A COMBINATION OF RENEW HOUSTON WITH METRO NEXT.
IN OTHER WORDS, YOU KNOW, THE CITY IS, UH, WE HAVE THIS BAD HISTORY IN THE CITY OF HOUSTON.
WE PUT DOWN NEW PAVEMENT AND ALL OF A SUDDEN WE HAVE TO TURN IT UP AND PUT
[00:40:01]
SOMETHING IN.WE'RE DOING THIS TOGETHER AND I THINK WE NEED MORE COLLABORATION BETWEEN THE CITY AND METRO ON, ON, SAY, THE METRO NEXT PROJECTS.
WE NEED MORE COLLABORATION WITH THE CITY AND TDO.
SOME OF THE ROADS IN THE SEA LIMITS OF HOUSTON ARE ACTUALLY STATE HIGHWAY, NORTH SHEPHERD BETWEEN THE SHEPHERD CURVE AND THE LOOP.
UH, WESTHEIMER ALL THE WAY UP TO THE COUNTY LINE.
UH, ONE'S A SPUR, ONE'S A FARM MARKET ROAD.
CAN WE WORK TOGETHER WITH T STOCK ON SOME OF THIS? I GO TO HDAC, TRANSPORTATION, CHALLENGING POWER MEETINGS.
I SEE VERY LITTLE MONEY FROM THE STATE COME THROUGH THAT POOL.
AND I THINK WE NEED TO WORK WITH OUR, WITH THE NEW LEGISLATURE, HOW DO WE GET MORE MONEY, PARTICULARLY ON ROADS THAT ARE PART OF OUR INFRASTRUCTURE, STATE OF THE PORT AND THAT SORT OF THING.
LASTLY, I GOT SOME IDEAS ON TRANSPORTATION THAT THE CITY COUNCIL PROBABLY OR THE CITY COULD USE TO SAVE MONEY.
NUMBER ONE, I'M GONNA USE AN EXAMPLE.
UM, EVOLVE HOUSTON CASEY IS PUSHING HIS EMPLOYEES TO USE METRO VERSUS HAVING TO USE A VEHICLE.
AND THEY ARE SAVING A LOT OF MONEY, UH, BECAUSE THEY'RE USING THE BUS AND THE TRAINS TO GET AROUND VERSUS HAVING TO USE A CAR.
AND I THINK THIS MIGHT BE SOMETHING, AND I THINK SALLY ALCORN WOULD BE THE PERSON TO DO IT BECAUSE SHE'S THE TRANSIT PERSON ON FRIDAY.
WHAT'S WRONG WITH USING A CUE CARD TO GET AROUND VERSUS A, YOU KNOW, POOLED CUE CARD VERSUS A CITY VEHICLE? WHEN Y'ALL START RIDING THE, THE STAFF STARTS WRITING.
PEOPLE GONNA SAY, HEY, IF THEY'RE RIDING METRO, MAYBE I SHOULD.
AND LASTLY, HOW ABOUT ACTIVE TRANSPORTATION? SAY IN THE DOWNTOWN AREA, YOU'RE GOING TO THE PERMIT CENTER BY THE AMTRAK STATION.
IT'S NOT THAT FAR OF A WALK, A BICYCLE OR MAYBE EVEN A, UH, AN ADULT TRICYCLE, EITHER ONE WITH A BASKET IN THE BACK.
I THINK WE NEED TO LOOK AT VARIOUS WAYS TO SAVE MONEY.
IS THERE SOME WAY WE CAN TAKE SOME THINGS THE CITY HAS TO CONTROL BECAUSE OF FAA REGULATIONS? I UNDERSTAND THAT, BUT THERE'S, COULD THERE BE SOME WAYS THAT THE USE THE AIRPORT SYSTEM COULD PRIVATIZE SOME OF THEIR STUFF SO THAT WE CAN GET MORE MONEY OUTTA IT? REMEMBER, IN LONDON, ENGLAND, GATEWAY AND HEATHROW AIRPORTS ARE NOT PUBLICLY OWNED.
THEY'RE ACTUALLY A CORPORATION.
I THINK EVERYTHING SHOULD BE ON THE TABLE.
ALSO, TOO, WITH THE LOOK AT THE BUDGET, WITH THIS GROUP THAT WE GET, UH, AUDIT GROUP, I THINK WE NEED TO LOOK AT ANOTHER PO CAN I SAY FINISH MY SENTENCE? SURE.
WHAT WOULD, WHAT WOULD A BASELINE BE OF THE SIG BUDGET IF THE CHURCH WERE NOT PRESENT? I THINK THAT WE NEED ALL THESE BASELINES TO GET A GOOD JUDGMENT OF WHAT'S GOING ON.
THANK YOU FOR BEING HERE AND FOR ALL YOUR COMMENTS AND YOUR IDEAS.
YOU KNOW, THE ONE THAT REALLY RESONATES WITH ME IS, IS YOUR, UH, COMMENT AROUND THE COORDINATION AND THE COLLABORATION WITH ALL THE DIFFERENT ENTITIES THAT ARE DOING PROJECTS, UH, AROUND THE CITY.
UM, WE HAVE A LOT OF FOLKS OUT THERE DOING PROJECTS FROM CITY, COUNTY, METRO, TURS, MANAGEMENT DISTRICT, YOU NAME IT, PLENTY MORE.
UM, THE MORE THAT THEY ARE COORDINATING AND TALKING AND COLLABORATING, THE MORE EFFICIENCY WE CAN GET.
WE CAN ELIMINATE SOME REDUNDANCIES, UH, AND, AND HAVE BETTER PROJECTS AND BETTER OUTCOMES.
SO, AND THAT'S THE MAYOR'S MEAL NAME.
NOW, THANK YOU FOR, FOR BEING HERE AND SHARING YOUR THOUGHTS.
TOPIC AND I'LL, I'LL SEE YOU SATURDAY TOO.
UM, NEXT UP WE HAVE DOUG SMITH.
I GOT IN THE WEEDS IN THE, UH, MONTHLY FINANCIAL REPORT THIS MONTH IN TO FUNDS THAT WE NEVER LOOK AT, UH, AT THESE MEETINGS.
THE FIRST ONE IS ON PAGE 28, THE AUTO DEALERS SPECIAL REVENUE FUND.
UH, THEY'RE SITTING AT THE END OF 2024 WITH $14 MILLION AND IT JUST CONTINUES TO STAY THERE.
AND I DON'T KNOW WHY THAT MONEY ISN'T PULLED BACK, UH, LIKE SO MANY OF THE OTHER FUNDS, UH, THERE MAY BE A REASON FOR IT, BUT IT'S SOMETHING THAT I THINK COULD BE LOOKED AT.
UH, ON PAGE 41, THE RECYCLING REVENUE FUND.
UH, THE ADOPTED BUDGET SHOWS REVENUES OF $220,000.
IF THAT'S A RECYCLING PROGRAM, UH, SOMETHING'S WRONG, UH, BECAUSE THERE ARE TONS OF RECYCLING TRUCKS GOING ALL OVER THE CITY TO A RECYCLING PLANT THAT IS IN A LOCATION THAT DOESN'T MAKE SENSE TO ME.
IT ALMOST OUTSIDE THE CITY, BUT I'D LIKE AN EXPLANATION FOR WHAT THAT FUND IS REALLY.
'CAUSE I DON'T THINK IT'S THE RECYCLING PROGRAM.
AND FINALLY, YOU ALL ARE EXCITED ABOUT THE ERON YOUNG REPORT.
[00:45:01]
I WOULD REMIND YOU THAT THE CITY HAD ANOTHER REPORT, I CAN'T REMEMBER THE THE NAME OF IT SEVERAL YEARS AGO THAT MADE SEVERAL SUGGESTIONS FOR WAYS TO SAVE MONEY.AND I THINK THERE ARE STILL TONS OF IDEAS IN THAT REPORT THAT HAVEN'T BEEN IMPLEMENTED.
SO YOU'RE EXCITED ABOUT ERNST AND YOUNG WORK.
DO IT WHEN YOU GET THE REPORT.
LIKE THIS OTHER REPORT IS DONE.
DOUG, ARE YOU TALKING ABOUT THE PFM REPORT? UH, YEAH.
WELL, THANKS, THANKS FOR FOR BEING HERE ALWAYS.
WE'VE GOT NOTES ON YOUR, UH, QUESTIONS AND WE'LL GET YOU, UH, FOLLOW UP TO THEM.
AND I SHOULD HAVE SAID LAST MONTH, UH, KATIE, WELCOME BACK.
WE HAVE NO MORE SPEAKERS SIGNED UP.
UM, SO WE ARE GOING TO ADJOURN THE MEETING.
THE NEXT BFA UH, MEETING IS TBD AS WE AWAIT THE OUTCOME OF OUR, UH, POTENTIAL BREAK WEEKS AT COUNCIL.