1 00:00:00,000 --> 00:00:13,080 Good afternoon, everyone. Welcome to the Financial Task Force of the Special Bond Committee. It's 2 00:00:13,080 --> 00:00:21,320 4.05, and we're going to go through a presentation that basically addresses several things that 3 00:00:21,320 --> 00:00:25,760 we asked for two weeks ago. And, Dave, I'll turn it over to you. 4 00:00:25,760 --> 00:00:31,280 Good afternoon, committee. Thank you for being here. Excited to go through the financials 5 00:00:31,280 --> 00:00:36,720 with you. Before we get into the financial presentation, we just have had some updates 6 00:00:36,720 --> 00:00:40,880 to our project costs that we want to go over with you all. Since we're going to be talking 7 00:00:40,880 --> 00:00:44,840 through finances, we'll be going through the same presentation with the entire group 8 00:00:44,840 --> 00:00:48,360 at 6 o'clock. But because we'll be talking through finances, we thought it was important 9 00:00:48,360 --> 00:00:53,040 to bring this to this group first since this meeting only because this meeting was prior 10 00:00:53,040 --> 00:00:56,480 to the 6 o'clock meeting. But we'll be going over the same information with the rest of 11 00:00:56,480 --> 00:01:01,080 the committee at 6 o'clock. Dave, a real quick question. Ma'am, could 12 00:01:01,080 --> 00:01:04,080 you introduce yourself? I'm Laura Alexander with Hilltop Securities. 13 00:01:04,080 --> 00:01:07,880 Adam was here last time, but he's still coming. We're with Simper. 14 00:01:07,880 --> 00:01:10,080 Great. Thank you. And our bond counsel, Greg Shaker, will be 15 00:01:10,080 --> 00:01:16,840 here later as well. I imagine he's probably dealing with the same trap as coming up here. 16 00:01:16,840 --> 00:01:23,520 So we wanted to touch base with the committee. Our public safety facility is just up to today. 17 00:01:23,520 --> 00:01:29,080 We've gotten revised cost estimates for our police renovation project and police substation 18 00:01:29,080 --> 00:01:36,240 project. The reason these numbers came back to us is because we engaged in an estimating 19 00:01:36,240 --> 00:01:41,920 firm just to true up our numbers to make sure that we were accurate with all the projections 20 00:01:41,920 --> 00:01:46,960 we have thus far with our project cost. This estimating firm would be the fourth that have 21 00:01:46,960 --> 00:01:51,880 looked at those project costs, including obviously our initial estimates from city staff before 22 00:01:51,880 --> 00:01:57,640 we even got really started with architects on what the cost might be. Then we consulted 23 00:01:57,640 --> 00:02:02,040 with our project architects, obviously. They're in schematic design to get their estimates, 24 00:02:02,040 --> 00:02:07,320 the architects used in estimating firm for their numbers, and those numbers really are 25 00:02:07,320 --> 00:02:13,640 all driving that initial project cost. We engaged this firm for a peak program value. 26 00:02:13,640 --> 00:02:18,600 They've done a number of cities throughout the country. They've also worked with Louisville 27 00:02:18,600 --> 00:02:24,480 quite a bit, currently working with Richardson on their police facility. And their numbers 28 00:02:24,480 --> 00:02:31,680 have increased quite a bit on both the police renovation and the police substation projects. 29 00:02:31,680 --> 00:02:38,840 In total, $21.4 million increase over our initial project cost, and that amount would 30 00:02:38,840 --> 00:02:44,440 be included in any bond issue for those projects. So I want to touch on what that increase really 31 00:02:44,440 --> 00:02:51,880 entailed. The construction cost increase is only $5 million, so that's not really driving 32 00:02:51,880 --> 00:02:57,400 that full $21 million. There were some increases, obviously, just in straight construction costs. 33 00:02:57,400 --> 00:03:03,200 The biggest increases from the new estimator were contingency and inflation. The previous 34 00:03:03,200 --> 00:03:11,440 estimates were fairly low on contingency and didn't have much inflation based on an expedited 35 00:03:11,440 --> 00:03:17,920 schedule. But the new estimators came in, and they've really added some weight to those 36 00:03:17,920 --> 00:03:24,960 numbers in the inflation, looking at a three-year timeline, knowing the market. Obviously, there 37 00:03:24,960 --> 00:03:28,960 are -- there's been a number of months since the last estimates, so that plays a factor 38 00:03:28,960 --> 00:03:35,120 in there. But also, there's just some methodology on what kind of contingencies you need in 39 00:03:35,120 --> 00:03:36,120 those budgets. 40 00:03:36,120 --> 00:03:38,160 So could I just interrupt for a moment? 41 00:03:38,160 --> 00:03:39,160 Sure. 42 00:03:39,160 --> 00:03:44,680 I guess I had understood -- and just for clarity purposes -- that we had, in the numbers we 43 00:03:44,680 --> 00:03:52,640 got originally, that we had about an 80% contingency and inflation factor in those numbers. But 44 00:03:52,640 --> 00:03:55,280 you're saying that was not what was the case here? 45 00:03:55,280 --> 00:04:00,200 I think you might be referring to on the streets projects, where we really got into the weeds 46 00:04:00,200 --> 00:04:04,560 of those numbers and we showed the contingency and inflation. For each of those streets projects, 47 00:04:04,560 --> 00:04:08,600 we did that. And those numbers have all been -- the street projects have all been estimated 48 00:04:08,600 --> 00:04:14,820 internally. So the original estimates did have a contingency amount, but in comparison 49 00:04:14,820 --> 00:04:20,000 to what the new estimator that came in, it's obviously significantly less than what the 50 00:04:20,000 --> 00:04:26,360 new estimators who come in say that it really -- you need to have in your budgets for these 51 00:04:26,360 --> 00:04:27,360 type of facilities. 52 00:04:27,360 --> 00:04:32,320 So we went through the same process that we've used with the roads. However, this firm that 53 00:04:32,320 --> 00:04:37,000 we brought in has recently completed a fire station in Lewisville, and they're completing 54 00:04:37,000 --> 00:04:41,040 a police station right now in Richardson. So I asked them to take another look and talk 55 00:04:41,040 --> 00:04:45,160 to both their managers and asked them to take a look at the -- and they were happy with 56 00:04:45,160 --> 00:04:48,640 the firm, so I asked them to take a look at our numbers, make sure that they were in agreement 57 00:04:48,640 --> 00:04:53,840 with the architect's numbers. I think the construction costs, they were. There's only 58 00:04:53,840 --> 00:04:59,920 about $5 million difference between the construction costs. They're not comfortable with the inflationary 59 00:04:59,920 --> 00:05:05,000 assumptions and the cost of labor over the next three years, and that's where you're 60 00:05:05,000 --> 00:05:12,120 seeing that delta. So just did not want to get into a situation where we have the previous 61 00:05:12,120 --> 00:05:16,080 road program where we get out there and fall short of money. So we asked them to double 62 00:05:16,080 --> 00:05:19,680 check all the other estimator's numbers based on what they're seeing. 63 00:05:19,680 --> 00:05:23,880 >> Do we feel the need to double check those numbers on the street projects? 64 00:05:23,880 --> 00:05:28,720 >> No. Todd has taken -- Todd has actually taken this approach on the street projects. 65 00:05:28,720 --> 00:05:35,520 He's built in not only inflationary present value estimates grossing up those numbers, 66 00:05:35,520 --> 00:05:40,200 he's also using actual bid amounts that we're seeing and grossing those up over the next 67 00:05:40,200 --> 00:05:45,640 few years in addition to building in pretty sizable contingencies. So we're in good shape 68 00:05:45,640 --> 00:05:50,360 with the road projects. I just wanted to be sure that we took that same approach with 69 00:05:50,360 --> 00:05:54,240 the buildings and not get caught flat footed, and it appears we may have done that had we 70 00:05:54,240 --> 00:05:58,560 not gone for this exercise. >> Yeah, we don't have a lot of recent cost 71 00:05:58,560 --> 00:06:04,680 data on PD renovation or substation. You do have recent cost data for roads because you're 72 00:06:04,680 --> 00:06:08,760 doing that all the time. >> Right. 73 00:06:08,760 --> 00:06:12,320 >> So just real quick, and obviously we can answer any additional questions, but wanted 74 00:06:12,320 --> 00:06:17,540 to touch on the second biggest piece of the increase of the 16 million after that 10 million 75 00:06:17,540 --> 00:06:24,040 that's really contingency and cost inflation was a 2 to 3 million increase in IT systems, 76 00:06:24,040 --> 00:06:29,720 security systems, and AP systems. These amounts were included in the original estimates, but 77 00:06:29,720 --> 00:06:34,040 the estimators come in and has had a lot of experience with similar projects recently, 78 00:06:34,040 --> 00:06:39,960 has said we need to bump those up significantly for what's needed. A lot of that is at the 79 00:06:39,960 --> 00:06:44,040 substation of brand new building where you have to install that infrastructure up front, 80 00:06:44,040 --> 00:06:49,240 but even with the renovation of the police station, really need an upgrade to that equipment, 81 00:06:49,240 --> 00:06:54,000 and during the renovation, you're going to have to get a lot of that new AV and IT equipment. 82 00:06:54,000 --> 00:06:59,320 And obviously, specifically the IT and the security are so important at a police station, 83 00:06:59,320 --> 00:07:05,240 so I think that different methodology at looking at those numbers has driven a lot of the increases. 84 00:07:05,240 --> 00:07:12,560 The other ones are obviously somewhat less significant in dollar amounts than the previous 85 00:07:12,560 --> 00:07:17,120 increases mentioned, but design and engineering costs were increased, some professional services 86 00:07:17,120 --> 00:07:22,280 such as material testing and commissioning hadn't been included in the original estimates, 87 00:07:22,280 --> 00:07:27,780 and then some increases on what you really need for those furnitures and fixtures. So, 88 00:07:27,780 --> 00:07:32,440 we just got these numbers in the past couple of days, wanted to get this to the committee 89 00:07:32,440 --> 00:07:37,600 as soon as possible, especially as we start heading into really the meat of the discussions 90 00:07:37,600 --> 00:07:41,840 on prioritizations and where that line is that we're going to move forward with to 91 00:07:41,840 --> 00:07:42,840 the voters. 92 00:07:42,840 --> 00:07:49,920 David, is the three-year timeline, is that the same timeline estimate as the original 93 00:07:49,920 --> 00:07:53,960 cost estimate or had that changed as well? 94 00:07:53,960 --> 00:07:57,880 It hasn't changed significantly. I mean, there's been some fluctuation in the months. I think 95 00:07:57,880 --> 00:08:01,760 the ultimate target's changed. I will say if you go back and look from February till 96 00:08:01,760 --> 00:08:07,480 now, there have been shifts in that, even shifts in when does the substation come on 97 00:08:07,480 --> 00:08:11,960 versus when does the station, so there has been variation. I don't think that alone hasn't 98 00:08:11,960 --> 00:08:16,000 been significant enough to drive the increase. I think it really is a methodology difference 99 00:08:16,000 --> 00:08:18,640 in how they looked at it. 100 00:08:18,640 --> 00:08:22,760 And we have also been working on the financing plan, trying to make sure that these were 101 00:08:22,760 --> 00:08:27,360 the first projects we would get in the pipeline in order to cut that timeline down as well. 102 00:08:27,360 --> 00:08:35,400 You know, it's a risk. We had a conversation with Chief Dixon yesterday, and his position 103 00:08:35,400 --> 00:08:40,200 is look, that renovation project needs to get done. If there's something that needs 104 00:08:40,200 --> 00:08:44,560 to be put on the back, the substation is his choice. We can go back out in a few years 105 00:08:44,560 --> 00:08:49,200 if the committee is uncomfortable about the dollars right now. He thinks it's incredibly 106 00:08:49,200 --> 00:08:54,120 important that it get done in the next few years, but that's kind of where we are at 107 00:08:54,120 --> 00:08:57,960 at this point. They're both major priorities to him, the renovation project has to get 108 00:08:57,960 --> 00:09:02,680 done. I know the question could come up, well, why wouldn't we look at a new facility, the 109 00:09:02,680 --> 00:09:06,520 same exact methodology on the new facilities. You're tearing down, you're acquiring even 110 00:09:06,520 --> 00:09:11,240 more property, and those prices are somewhere in the $60 to $70 million range, so it's not 111 00:09:11,240 --> 00:09:15,160 even close to the same cost to build the new facility, plus you're left with City Hall 112 00:09:15,160 --> 00:09:17,960 East, which is half empty at that point. 113 00:09:17,960 --> 00:09:24,520 So how do you think the council feels about adding another $21 million to what was our 114 00:09:24,520 --> 00:09:28,120 charge at $2.10 is kind of a high end? 115 00:09:28,120 --> 00:09:33,800 I think the council, well, they don't have this information. David was actually putting 116 00:09:33,800 --> 00:09:40,040 the final touches on this about 45 minutes ago. I think from their perspective, if you 117 00:09:40,040 --> 00:09:44,520 came back and said, look, we are willing to move forward, we think all these things are 118 00:09:44,520 --> 00:09:49,400 so important, we're willing to move forward, we'd like you to consider adjusting the cap 119 00:09:49,400 --> 00:09:55,400 that we go out for, they would consider it. They hadn't seen the growth numbers that we're 120 00:09:55,400 --> 00:09:59,640 looking at or the interest rate numbers we're looking at as well, and I think they're going 121 00:09:59,640 --> 00:10:02,120 to be very curious to see what your opinion is. 122 00:10:02,120 --> 00:10:12,600 I can move on with the finance presentation, and we obviously answer any questions on this 123 00:10:12,600 --> 00:10:16,680 as we go through. This will obviously be brought back. This is the same exact presentation, 124 00:10:16,680 --> 00:10:20,760 this piece of the presentation at 6 o'clock as well. So can I answer questions on this 125 00:10:20,760 --> 00:10:24,920 throughout the process, or I could go ahead and shift now to the finance presentation, 126 00:10:24,920 --> 00:10:26,040 if that makes sense. 127 00:10:26,040 --> 00:10:27,000 Let's go ahead and do that. 128 00:10:27,000 --> 00:10:40,680 So a few of the objectives of this presentation. Obviously, this is a follow-up to the meeting 129 00:10:40,680 --> 00:10:44,680 a couple of weeks ago, the finance meeting a couple of weeks ago, with some takeaways 130 00:10:44,680 --> 00:10:49,000 from that meeting and some scenarios that the committee asked to see, and also talking 131 00:10:49,000 --> 00:10:54,200 through the language requirements and how we're affected or not affected by the new legislation. 132 00:10:54,200 --> 00:10:59,080 So this is the same slide that we saw last time at the set the stage. Here are some of 133 00:10:59,080 --> 00:11:05,720 those financial assumptions that we've made going into all of our scenarios and our analysis of the 134 00:11:05,720 --> 00:11:12,120 impact of the new debt issuances and the bond program, closing out the 2014 bond program 135 00:11:12,120 --> 00:11:17,480 next year, and then that $5 million in COs that we budgeted in each of the future years. 136 00:11:17,480 --> 00:11:24,120 Our interest rates at 3.75 next year and then assuming a 4.5 interest rate in the 137 00:11:24,120 --> 00:11:28,840 following years. We're also utilizing that fund balance over those first few years 138 00:11:28,840 --> 00:11:33,320 to work with what the tax rate impact will be in those first couple of years, 139 00:11:33,320 --> 00:11:40,600 $3.6 million use of fund balance. This is a similar chart to what we saw last time I did 140 00:11:40,600 --> 00:11:47,240 for the assessed value history. I've included a couple previous years based on this conversation, 141 00:11:47,240 --> 00:11:51,800 just to, there were some comments that say, "Hey, can we see what it will look like during the last 142 00:11:51,800 --> 00:11:57,160 recession?" So have included back to 2008, so you can see, you know, we had the dip there, 143 00:11:57,160 --> 00:12:03,480 but then since 2011, have seen those increases and obviously the past few years, the increases have 144 00:12:03,480 --> 00:12:09,320 been significant. We do have updated numbers. We get those preliminary values from the appraisal 145 00:12:09,320 --> 00:12:14,360 district each Friday. We just got our last preliminary value last Friday, so those numbers 146 00:12:14,360 --> 00:12:19,320 are now updated. All of our scenarios have the updated preliminary values. We'll get our two 147 00:12:19,320 --> 00:12:25,080 weeks from Friday, from last Friday, we'll get our final certified values. Where we are now is we're 148 00:12:25,080 --> 00:12:34,920 at 8.07%, right at 8% in total AV growth. We're at 7.3%, an increase of our non-frozen values, 149 00:12:34,920 --> 00:12:39,800 which as we move forward from a city perspective, that non-frozen value is really going to become 150 00:12:39,800 --> 00:12:44,680 the primary driver of our revenue, since those frozen values really are not something we can 151 00:12:44,680 --> 00:12:52,520 control or can really anticipate moving forward. So that 7.3% is really what's been driving a lot 152 00:12:52,520 --> 00:12:59,480 of the increases that you'll see in our, in our scenarios moving forward. Sure. Go ahead Randy. 153 00:12:59,480 --> 00:13:07,400 I'm just going to ask, do we know in the 8.07%, is that existing assessment ideas or is that 154 00:13:07,400 --> 00:13:13,800 new property? That includes both new and existing. You know what the breakdown is? Yeah, existing is 155 00:13:13,800 --> 00:13:24,040 around 430 to 440 million and then the remainder of the close to 11 billion is existing values. 156 00:13:24,040 --> 00:13:28,200 I want to say 10 point, I think it's close, when we look at the non-frozen it's you know closer to 157 00:13:28,200 --> 00:13:36,120 the 10 billion in the total. Say that again please. Sure. So it's around, I'll just use kind of big, 158 00:13:36,120 --> 00:13:47,320 big numbers and not, sure. So around 400 million, 400 million in new value and around 11 billion in 159 00:13:47,320 --> 00:13:59,560 total, total assessed value. So you know half a percent. The, was the, was the freeze passed in 17 160 00:13:59,560 --> 00:14:05,800 and did it then go into effect in 18? Correct. 18 was our first year of the freeze. 161 00:14:06,360 --> 00:14:14,520 That's reflected in that percentage drop. This, these percentages include, these are absent of 162 00:14:14,520 --> 00:14:19,160 the freeze. These are just our total values in the, in the actual bar charts for comparison sake. 163 00:14:19,160 --> 00:14:23,560 This does not include the freeze. This is just what our AV would be in total if we didn't have 164 00:14:23,560 --> 00:14:27,640 the freeze. So we're apples to apples. So it's apples to apples. If we did, if we didn't include 165 00:14:27,640 --> 00:14:32,040 that, that you know the increase wouldn't be as high and it wouldn't be a good comparison. 166 00:14:32,040 --> 00:14:36,760 That's why we just made that note here that though we're showing 8 percent in total, 167 00:14:36,760 --> 00:14:43,080 the actual increase in non-frozen values is 7.3 percent. And David is my understanding correct 168 00:14:43,080 --> 00:14:51,960 that as the timeline gets longer since someone's taxes was frozen, you would expect that impact to 169 00:14:51,960 --> 00:14:58,520 grow as far as city impact? Yeah. I mean as long as they, if AVs are growing and that, because that's 170 00:14:58,520 --> 00:15:05,000 actually the property tax they're paying to us is frozen, correct. As AVs grow, the impact to us 171 00:15:05,000 --> 00:15:09,960 will increase assuming that those, you know, that everyone stays in their home. Obviously there's 172 00:15:09,960 --> 00:15:14,920 going to be some change with people urban out and people applying for the over 65 in latter years. 173 00:15:14,920 --> 00:15:19,800 But as far as the population of people who have it now, that will happen as AVs grow. Until you get 174 00:15:19,800 --> 00:15:25,560 to sort of a stable state where people who have the exemption are an average or a median number 175 00:15:25,560 --> 00:15:31,720 of age, for instance, until the age stops rising. Yeah and I think, you know, especially since we're 176 00:15:31,720 --> 00:15:36,840 only in the second year, I think that's true. As we get to years five, six, seven, it'll all kind of 177 00:15:36,840 --> 00:15:41,720 be apples to apples and we'll be able to know what to expect. I think if you look at the budgets of 178 00:15:41,720 --> 00:15:46,360 cities who've had the freeze for quite a few years, they don't spend as much time kind of going through 179 00:15:46,360 --> 00:15:50,600 the nuances of it. But because, you know, it's important to look at the history, we have to make 180 00:15:50,600 --> 00:16:03,720 sure we call that out the differences. So our actual increase in taxable appraised value is 7.3%, 181 00:16:03,720 --> 00:16:10,040 is that right? In taxable appraised value, that's right. I think that's an important distinction. 182 00:16:10,040 --> 00:16:18,440 The way that it gets kind of confusing is it's 7.3% on the non-frozen values. 183 00:16:19,080 --> 00:16:25,080 So we look at that in separately from, we are also still getting property tax revenue from those 184 00:16:25,080 --> 00:16:30,360 frozen values, but it's just set. So the way that we've begun looking at it is that's just kind of a 185 00:16:30,360 --> 00:16:35,000 separate source of revenue that's coming in versus what we're actually getting from 186 00:16:35,000 --> 00:16:45,080 people who are paying taxes on the AV as it changes. But for our purposes of assumed growth, 187 00:16:46,200 --> 00:16:55,240 I would-- the 7-- this-- the 7.3% is the number that's most comparable to what our assumed growth 188 00:16:55,240 --> 00:17:10,200 should be in future years. So here's a high level of the forecasted scenarios that the committee 189 00:17:10,200 --> 00:17:17,080 asked us to bring back were assessed value assumptions at 4%, 5%, and 6%. And really the numbers 190 00:17:17,080 --> 00:17:26,040 tied out very right at these max debt service tax rate increases at $0.05 for 4%, $0.04 on the debt 191 00:17:26,040 --> 00:17:32,840 service side for 5% and $0.03 for 6%. As you'll see as we go through those, we kind of get up to 192 00:17:32,840 --> 00:17:38,280 that number in the latter years of the program as the debt starts to get to that point. We've 193 00:17:38,280 --> 00:17:43,320 included here on the right column the impact on $100,000 assessed value. This number wasn't just 194 00:17:43,320 --> 00:17:51,240 picked at random. This is the language that will be included in future bond elections based on the 195 00:17:51,240 --> 00:17:56,520 new legislation to have that comparison on $100,000 assessed value. And you can see it's fairly 196 00:17:56,520 --> 00:18:02,760 simple math to come up with, you know, at 5% increase would be $50, 4% increase would be $40. 197 00:18:03,480 --> 00:18:08,600 Now that increase would only occur in that year that we get up to that max as we're getting up. 198 00:18:08,600 --> 00:18:14,360 It wouldn't be $40 in that 5% every year. It would just be that year that we hit the max debt 199 00:18:14,360 --> 00:18:19,960 service tax rate. Again, this is a 6-year implementation that we have for all of our 200 00:18:19,960 --> 00:18:26,680 scenarios and for the debt program. Did you want to make note? An estimate about $14 million--as 201 00:18:26,680 --> 00:18:31,240 we increase about $14 million from this point forward would equal about another cent on the 202 00:18:31,240 --> 00:18:37,400 debt service tax rate side. So the other $21 million would be a penny and a half. Correct, yeah. 203 00:18:37,400 --> 00:18:50,600 As we go, we're talking about the legislation and the language here in a few slides, 204 00:18:50,600 --> 00:18:56,200 but do you want to just make note that this debt service tax rate increase is not something that's 205 00:18:56,200 --> 00:19:00,600 included in, you know, in the election ordinance or in the official language, but it is something 206 00:19:00,600 --> 00:19:06,600 that we included in our bond booklets and have always included to give that reference to voters 207 00:19:06,600 --> 00:19:14,600 as they head to the polls. Can I just ask one more question? Do we know what the average assessed 208 00:19:14,600 --> 00:19:22,520 home value is in debt? What's the average value of a home? So last year it was $233,000 and this 209 00:19:22,520 --> 00:19:29,560 is on homesteaded, kind of average taxable, so this would be after exemptions. $233,000 last year. 210 00:19:29,560 --> 00:19:34,280 This year it's looking closer to around $250,000. We don't have an exact number on that yet. 211 00:19:34,280 --> 00:19:41,640 Because the $100,000 gives us a round number, but it doesn't really tell you the 212 00:19:41,640 --> 00:19:45,160 impact on the average person. So I'll just skip over to this real quick. 213 00:19:45,160 --> 00:19:51,080 On all of these slides, and this is the same kind of format that we did last time, obviously a lot 214 00:19:51,080 --> 00:19:56,600 of numbers, but it helps to kind of pinpoint some of that information. So when you see the average 215 00:19:56,600 --> 00:20:06,040 tax bill here for FY19, that's based strictly on our approved tax rate and that $233,000 in average 216 00:20:06,040 --> 00:20:12,520 taxable value. And in the future years on this, with each scenario, I've assumed that the taxable 217 00:20:12,520 --> 00:20:18,360 value will grow at the same percentages assessed value. That doesn't tie out exactly in real terms, 218 00:20:18,360 --> 00:20:23,080 but for purpose of the scenarios have just tied those numbers together. So when you see the average 219 00:20:23,080 --> 00:20:29,160 tax bill here, that's after saying the taxable values have increased 4% over these couple of 220 00:20:29,160 --> 00:20:40,280 years times what this total tax rate is. The only purpose is shown at the $100,000 is because that's 221 00:20:40,280 --> 00:20:46,280 kind of the new language and showing that manner. So with the 4% growth, I can go through these 222 00:20:46,280 --> 00:20:51,880 fairly quickly because we've seen a lot of the same information as far as the 3.5% rollback and 223 00:20:51,880 --> 00:21:00,120 the effective rates, but this does show we're at that 5 cent increase here in 2025 as we go 224 00:21:00,120 --> 00:21:07,960 from our current tax rate of 21.5 cents getting up to that 26.5 cents on the 4% growth. 225 00:21:07,960 --> 00:21:13,080 And then we're going to see similar things as we go through these slides of getting up to 226 00:21:13,080 --> 00:21:19,160 25.5 cents on the 5 cent growth, which is a 4 cent increase on the debt service tax rate. 227 00:21:21,160 --> 00:21:28,920 And then at the 6%, we're getting up to that 24.5 cents where it's that 3 cent increase. 228 00:21:28,920 --> 00:21:35,800 I think as you go, and I'll just skip back to the 4%, you can see one of the, as we spoke, 229 00:21:35,800 --> 00:21:41,480 as we went into this process with city council, one of the goals was to stay below our total tax 230 00:21:41,480 --> 00:21:48,760 rate each year of the program. So while our debt service tax rate is increasing those 3 to 5 cents, 231 00:21:48,760 --> 00:21:55,720 our total tax rate is remaining below the current tax rate. And that's because as the AV increases 232 00:21:55,720 --> 00:21:58,440 that debt service first M&O trade off is going on. 233 00:21:58,440 --> 00:22:07,800 So are those M&O rates assuming at least from 2021 on, are those assuming effective M&O rate? 234 00:22:07,800 --> 00:22:14,360 They are effective M&O rates every year from 21 on. And this 20 number is just an estimate. 235 00:22:14,360 --> 00:22:19,960 We don't have any, we're not at a point where we have our proposed M&O rate, but put that in there 236 00:22:19,960 --> 00:22:38,600 for planning purposes. Any discussion on any of this? We kind of honed in on 5% as one assumption 237 00:22:38,600 --> 00:22:42,920 and 6% was kind of the high end of the sensitivity analysis. 238 00:22:44,440 --> 00:22:55,400 So another request from the committee was to come back and bring some of the language that would be 239 00:22:55,400 --> 00:23:00,680 in the new legislation. So this is obviously changing and trying to get the true interpretation 240 00:23:00,680 --> 00:23:05,560 of what the legislation is and when it goes into effect after consulting with our bond council. 241 00:23:05,560 --> 00:23:09,480 The September 1st is the date that the legislation goes into effect, 242 00:23:09,480 --> 00:23:15,240 but because we will be calling the election before August 19th, the new legislation will 243 00:23:15,240 --> 00:23:20,760 not apply to this bond election. Despite the election occurring in November, because we're 244 00:23:20,760 --> 00:23:27,080 calling it before September 1st, the new legislation will not be required. What we have brought forward 245 00:23:27,080 --> 00:23:31,320 to the committee for consideration and something that we'll talk through with city council as we 246 00:23:31,320 --> 00:23:36,600 move forward is how can we, despite not having the legislation be required, how can we do 247 00:23:36,600 --> 00:23:41,000 things in the spirit of the legislation, understanding what the intent of the legislation 248 00:23:41,000 --> 00:23:46,120 is and try to take those actions to show that while we're not required, we're going to do 249 00:23:46,120 --> 00:23:51,720 everything we can to present information in the manner of the city the legislation requires. 250 00:23:51,720 --> 00:23:55,080 Some of that gets a little bit difficult because there are different definitions in 251 00:23:55,080 --> 00:23:59,880 our current language that we're required to do as far as what the debt is, what our outstanding debt 252 00:23:59,880 --> 00:24:05,720 is versus what the new legislation requires, but I think we can work through a lot of that to go 253 00:24:05,720 --> 00:24:09,880 as far as we can to be in the spirit of the legislation. So some of these following slides 254 00:24:09,880 --> 00:24:15,640 you'll see that we've drafted some of the language that would be included in a new legislation. 255 00:24:15,640 --> 00:24:25,240 So the most significant change, and there's quite a few language changes, but one of the most 256 00:24:25,240 --> 00:24:29,880 significant changes in the new legislation is a new document called the voter information 257 00:24:29,880 --> 00:24:35,880 document which has a table of a lot of information pertaining to the bonds and some of the assumptions 258 00:24:35,880 --> 00:24:43,560 which we've drafted what that voter document would look like at our various four, five and six percent 259 00:24:43,560 --> 00:24:48,360 AB scenarios that we can go through with the committee in the following slides. I do want 260 00:24:48,360 --> 00:24:52,840 to just continue to point out the legislation is still pending. We're still waiting on some opinions 261 00:24:52,840 --> 00:24:58,440 on exactly, for instance, on our outstanding debt. Is that outstanding debt like it currently is at 262 00:24:58,440 --> 00:25:03,640 the beginning of the fiscal year, October 1st, or is it outstanding debt as of the day the election's 263 00:25:03,640 --> 00:25:08,040 called? So there's still some of those nuances that that we need to get opinions on, but we've 264 00:25:08,040 --> 00:25:13,960 moved forward with our assumptions for what that might look like. And we've also handed out to 265 00:25:13,960 --> 00:25:20,600 everyone a draft of what our election ordinance would look like based on our current requirements 266 00:25:20,600 --> 00:25:25,400 and some of the information that we've added to try to meet that spirit of the new legislation. 267 00:25:28,680 --> 00:25:36,200 So here's an example of that voter information table that we would suggest moving forward with 268 00:25:36,200 --> 00:25:42,760 to be in the spirit of the new legislation where we list our total debt and interest of the bond 269 00:25:42,760 --> 00:25:50,520 program. So total debt service to be paid for the life of the bond program, which we've got right 270 00:25:50,520 --> 00:25:55,560 now our estimate is about $316 million based on all the assumptions that we have so far on interest 271 00:25:55,560 --> 00:26:02,520 rates and when we would sell the bonds. And then we also list our outstanding debt paid specifically 272 00:26:02,520 --> 00:26:10,280 from property tax. So this is a property tax supported debt. If you, as you just when you, 273 00:26:10,280 --> 00:26:13,160 when you actually, when you look through the ordinance, this is one of those pieces where 274 00:26:13,160 --> 00:26:19,080 there's different numbers. If you go to section 16 of the ordinance, our current requirements are 275 00:26:19,080 --> 00:26:24,760 that we have to list all of our outstanding debt. So this number is quite a bit different in the, 276 00:26:24,760 --> 00:26:29,640 in section 16 of the ordinance versus what we're showing here, where the new requirement is you 277 00:26:29,640 --> 00:26:34,040 only have to show your debt, your tax supported debt. So this is one of those that it actually, 278 00:26:34,040 --> 00:26:39,720 it's a more accurate picture where it is more appropriate to look at what our property 279 00:26:39,720 --> 00:26:46,200 tax paying versus especially, especially since we're, since we're a full service city, we have 280 00:26:46,200 --> 00:26:50,360 electric, water, wastewater, solid waste. We have obviously quite a bit of debt as we talked about 281 00:26:50,360 --> 00:26:56,680 last time. That's, that's supported by other revenues. But you can see the way we list each 282 00:26:56,680 --> 00:27:01,960 of those assumptions in this, in this form, we show that estimated maximum annual increase 283 00:27:01,960 --> 00:27:07,080 that we saw earlier, which are going to be at $50, $40 and $30 in each of those scenarios. 284 00:27:07,080 --> 00:27:12,760 What percentage of the current debt drops off each year? 285 00:27:12,760 --> 00:27:19,000 I don't have a percentage. I do have this slide that we looked at last time. 286 00:27:20,360 --> 00:27:23,880 But we can get that. We can kind of get an average percentage, but you can see that's 287 00:27:23,880 --> 00:27:30,360 showing 25 million. That's debt service payment. So that's a little different than, 288 00:27:30,360 --> 00:27:34,360 than the actual debt. Right. Yeah. The other one was total, 289 00:27:34,360 --> 00:27:38,200 essentially our total debt service payments that we would make over 20 years are outstanding. 290 00:27:38,200 --> 00:27:40,920 This is just how much that debt service payment is made each year. 291 00:27:43,400 --> 00:27:51,000 And that's all that. That's not just this is just property tax. So back on the other page, 292 00:27:51,000 --> 00:27:57,880 would, would it be correct to say that basically by issuing this bond we're doubling, doubling our, 293 00:27:57,880 --> 00:28:05,880 we don't have to show them a total box. I think that's one of the limitations 294 00:28:05,880 --> 00:28:10,760 of the way that it's presented here is it gives that appearance and that can, that can, 295 00:28:10,760 --> 00:28:14,760 obviously that's a takeaway when you look at this, you see, but I think the important piece is 296 00:28:14,760 --> 00:28:20,280 this slide, like it's not doubling in the sense that as this debt, as our debt service is falling 297 00:28:20,280 --> 00:28:25,080 off in each of these years, we're just adding more debt service. So some of that increase is 298 00:28:25,080 --> 00:28:29,160 negated by debt service falling off. And that's not taken into impact. 299 00:28:29,160 --> 00:28:31,960 Right. It's not really shown there in that, in a clear manner. 300 00:28:31,960 --> 00:28:36,520 Well, this isn't, is this going to be on the ballot or in the information? 301 00:28:36,520 --> 00:28:40,760 The voter information document, is it an exhibit with the ballot? 302 00:28:40,760 --> 00:28:44,440 Not with the ballot, but in the election order? 303 00:28:44,440 --> 00:28:45,240 In the election order. 304 00:28:45,240 --> 00:28:49,480 Sorry, our bond counsel, Grace Shaker. 305 00:28:49,480 --> 00:28:51,320 But it's not, but if you're, but if you're, 306 00:28:51,320 --> 00:28:54,360 if you're standing there in the ballot box, you're not seeing all of this. 307 00:28:54,360 --> 00:28:57,160 No. It will be in the ballot. 308 00:28:57,160 --> 00:29:03,000 It will not be in the, in the ballot. The ballot will just be the, the three line, 309 00:29:03,000 --> 00:29:12,680 right? Summary of the proposition. So it'll be, or it can be attached to the election ordinance, 310 00:29:12,680 --> 00:29:21,080 or you can create it as a separate standalone document, but the voter information document, 311 00:29:21,080 --> 00:29:26,120 whether it's part of the election order or separate, is posted at each polling location 312 00:29:26,760 --> 00:29:34,040 by state law, it's posted on the website, and it's also posted in Republican locations in the city. 313 00:29:34,040 --> 00:29:43,640 So we've drafted this for informational purposes as we go through the process. I think 314 00:29:43,640 --> 00:29:47,560 we can decide how, you know, what we want to show, whatever we require to show and go through that 315 00:29:47,560 --> 00:29:52,600 process. Looks like a lot, like a truth and lending disclosure. 316 00:29:56,280 --> 00:30:00,280 So a lot of these numbers aren't really, aren't going to change too much other than that, 317 00:30:00,280 --> 00:30:06,280 that highlighted amount that we showed earlier on the $40 as that maximum increase on $100,000 318 00:30:06,280 --> 00:30:11,800 valuation at 5% and some of those different lengths, just the assessed value change. 319 00:30:11,800 --> 00:30:14,760 And the same with the 6%. 320 00:30:23,080 --> 00:30:30,520 Would that chart also be in the voter information, the graph on the next page? 321 00:30:30,520 --> 00:30:34,440 It's not required, although, and I don't know if you want to pull up to the table. 322 00:30:34,440 --> 00:30:40,120 It's not required, although, and I'll stand to be corrected, 323 00:30:40,120 --> 00:30:43,800 we can include additional information if we would like to. So I'll ask 324 00:30:43,800 --> 00:30:48,200 Greg to kind of tell us where we would include that additional information. 325 00:30:54,040 --> 00:31:01,960 That David is, is correct. I think he's showing what's the minimum that's required under the new 326 00:31:01,960 --> 00:31:08,520 statute, but the statute even specifically says you can add whatever information the city deems 327 00:31:08,520 --> 00:31:15,720 important or relevant with respect to this. So you can certainly add information like the chart. 328 00:31:19,880 --> 00:31:25,800 I think that's going to be pretty important. If somebody can tie it together. 329 00:31:25,800 --> 00:31:27,800 It's connecting the dots is going to be the challenge. 330 00:31:27,800 --> 00:31:29,800 Yeah, you got to figure out how to do that. 331 00:31:29,800 --> 00:31:38,200 Okay. What are you calling the dots? Let me just, let me. 332 00:31:38,200 --> 00:31:41,800 Yeah, so how do you- Who's connecting the dots here? 333 00:31:41,800 --> 00:31:44,600 So go to the next slide. The average citizen. 334 00:31:44,600 --> 00:31:47,800 Yeah, the average citizen. So how do you, how's the average citizen connect 335 00:31:48,360 --> 00:31:55,000 the numbers in that previous chart to the debt falling off and understanding that 336 00:31:55,000 --> 00:32:05,000 you're essentially going to try and keep the debt level fairly flat because of that drop off? 337 00:32:05,000 --> 00:32:12,280 I would say information that might be good to kind of, to just add some context to this would just be 338 00:32:12,280 --> 00:32:18,680 how much is that debt service that you're actually paying per year increase where a takeaway from 339 00:32:18,680 --> 00:32:24,280 this could be our debt that we're paying each year is doubling, where that's not true as our 340 00:32:24,280 --> 00:32:28,680 debt service is falling off. Obviously it is, ultimately it's going to be above this 25 million 341 00:32:28,680 --> 00:32:35,400 dollar number because we need that additional tax rate to pay for it, but it's not going to be 342 00:32:35,400 --> 00:32:40,280 double what our current debt service is. If I were doing the chart, I would say you 343 00:32:40,280 --> 00:32:46,280 need a third color that says, okay, this is what's dropping off. This is what we're adding on to that 344 00:32:46,280 --> 00:32:52,680 over time. I think that when we start 345 00:32:52,680 --> 00:33:01,800 facing sort of these realities, this is too much work for most voters. The connecting the dots is 346 00:33:01,800 --> 00:33:12,520 too much work. So that it's what are the benefits and these are the benefits of this tax increase 347 00:33:12,520 --> 00:33:21,160 and additional debt and the other side of that is that the argument will be 348 00:33:21,160 --> 00:33:28,040 we're going to double our debt load and what that's going to mean is that for every citizen in Denton 349 00:33:28,040 --> 00:33:35,000 and they'll lump in at that point also the non-property tax debt and they'll say every 350 00:33:35,000 --> 00:33:41,560 citizen of Denton, if this passes, owes this much money and that will be those will be the things 351 00:33:41,560 --> 00:33:47,320 that we have to overcome because those are the simple messages and it's a simple message that's 352 00:33:47,320 --> 00:33:54,040 going to be critical on this. Yeah and if somebody were not privy to the information that we're privy 353 00:33:54,040 --> 00:33:59,640 to and saw this they would say you're doubling more than doubling the amount of debt with this 354 00:33:59,640 --> 00:34:10,600 bond offering. So I think a third box might be information. You know this also goes back to 355 00:34:10,600 --> 00:34:14,840 where we might be one of the first cities to actually start to draft something like this. 356 00:34:14,840 --> 00:34:19,640 So it will be interesting as you know next year when those those bond elections go out to see how 357 00:34:19,640 --> 00:34:26,760 cities tackle this and what additional information they add to the voter information. So with the 358 00:34:26,760 --> 00:34:31,080 six-year implementation of this bond program I'm just like your point you're adding $210 million 359 00:34:31,080 --> 00:34:35,960 over six years though it's not all one day one and so how much will you have paid off over that six 360 00:34:35,960 --> 00:34:40,920 years and sort of a pro forma snapshot in your fiscal 2026 when you're done. That might be helpful. 361 00:34:45,960 --> 00:34:51,720 You're paying off significant principal every year you want to pay off 210 million obviously 362 00:34:51,720 --> 00:34:58,440 but it'll be meaningful I think to look at it more in that regard so there's a thought. Yeah 363 00:34:58,440 --> 00:35:05,800 that'll be an important piece because the average citizen I think would think we're issuing 209 all 364 00:35:05,800 --> 00:35:17,480 at once. Yeah everyone's coming to this this is a mortgage I get a signed mortgage I get all the 365 00:35:17,480 --> 00:35:24,760 money up front and I pay that down. Yeah it's not. It's not like that at all. That's not how any of this works. 366 00:35:24,760 --> 00:35:30,600 But that's how they're going to think about it. That's how they're going to think about it and that would be 367 00:35:30,600 --> 00:35:36,440 natural because that's what most people have done. We'll prove this up but roughly Adam's thinking 368 00:35:36,440 --> 00:35:42,120 we'll pay off 98 million by the time the full 210 million is issued but keep in mind too once you 369 00:35:42,120 --> 00:35:46,920 some of that is starting to get paid off too so you'll never really have the new 210 million all 370 00:35:46,920 --> 00:35:50,200 outstanding at one time because some of it will start to be paid in year one you know the first 371 00:35:50,200 --> 00:35:55,800 bond issue starts to amortize the very next year but we can run that exit pro forma to see what the 372 00:35:55,800 --> 00:36:02,120 debt would look like in 2026 but that would be what 35 40 percent of existing debt would be paid 373 00:36:02,120 --> 00:36:15,960 off by the end of the year. So one of the I think things we owe the full committee that was discussed 374 00:36:15,960 --> 00:36:23,160 at the last meeting is bringing a recommendation to the full committee of what we think 375 00:36:24,680 --> 00:36:35,320 should be the AB and subsequently the impact assuming I think we're all solid on the 210 is a 376 00:36:35,320 --> 00:36:44,600 starting point. Is that a fair statement? But now with the cost estimate changes does something drop 377 00:36:44,600 --> 00:36:51,400 off then or? Yeah I think that's a I think that's a conversation of the group is to say either you 378 00:36:51,400 --> 00:36:59,400 make the bag bigger or you what do you cut and I don't think that's our purview in this group. 379 00:36:59,400 --> 00:37:07,800 I think we've been operating 210 everybody has up to this point so I'd stick to that as far as 380 00:37:07,800 --> 00:37:14,680 looking at our growth and impact from tax breaks and all that. I mean we just as we come out of this 381 00:37:14,680 --> 00:37:21,800 we literally just added another variable to the equation today. Yes so that variable could significantly 382 00:37:21,800 --> 00:37:29,640 impact the 50 40 and 30 dollars. Or we state that we stick with 210 and we just cut on the bottom. 383 00:37:29,640 --> 00:37:34,600 You were gonna say something. Yeah I mean because I think we have to start talking about 230. 384 00:37:34,600 --> 00:37:41,080 Are we comfortable with 230 or not and if we're not then we go to 210 and how do we get to 210? 385 00:37:42,200 --> 00:37:49,160 I think those are the okay. So what are y'all's thoughts about say 230? 386 00:37:49,160 --> 00:37:57,880 No I don't either. I mean I think we can we can look at the impact 387 00:37:57,880 --> 00:38:03,880 and growth assumptions both 210 and 230 and let the committee decide. 388 00:38:03,880 --> 00:38:13,720 No I like that yeah. It's a penny and a half. It's a penny and a half so they can see. 6.5, 5.5, 4.5 cents. 389 00:38:13,720 --> 00:38:21,320 Yeah if the committee if you're not you are still where you were last time and we're in 5% AV is 390 00:38:21,320 --> 00:38:25,800 kind of where we want it up as far as assumptions then we would say we start with that four cents 391 00:38:25,800 --> 00:38:32,360 at 210 and then 230 we just kind of roughly say that would be five and a half cents. 392 00:38:34,120 --> 00:38:35,640 Okay. 393 00:38:35,640 --> 00:38:46,840 So is there a sense of where we are in terms of AV? I would just say this that a nickel scares 394 00:38:46,840 --> 00:38:54,040 the hell out of me. That asking the voters to approve a nickel is I mean we're gonna have to 395 00:38:54,040 --> 00:38:58,920 make a hell of a case because that that looks like a lot. 396 00:39:01,560 --> 00:39:09,960 But the danger of going higher is that it could be perceived that we didn't tell them the truth 397 00:39:09,960 --> 00:39:16,360 when growth doesn't hit that higher. Well I think our our our responsibility is to assess 398 00:39:16,360 --> 00:39:24,600 what we think is is a good number. I mean we can't we can't take a doomsday scenario unless we just 399 00:39:24,600 --> 00:39:30,920 simply want to operate in in this uh in a worst case scenario. In a worst case scenario then what 400 00:39:30,920 --> 00:39:34,840 I would say is we're gonna do that we're gonna go we're gonna have to ask for less than 210. 401 00:39:34,840 --> 00:39:39,880 We're gonna have to start cutting things because I don't think we ought to be going to the voters 402 00:39:39,880 --> 00:39:46,920 asking for six and a half cents and that's in essence if we went to 230. So we're now down to 403 00:39:46,920 --> 00:39:56,680 210 at a nickel and and a nickel is is a pretty is still a pretty steep hill to climb in terms of 404 00:39:56,680 --> 00:40:03,240 asking the voters to approve a nickel. If we if we decide we're going to take a worst case scenario. 405 00:40:03,240 --> 00:40:09,800 So when your mind is asking for a nickel like saying the car costs ten thousand dollars and 406 00:40:09,800 --> 00:40:12,760 you'd rather say it's nine hundred nine thousand nine hundred ninety nine. 407 00:40:12,760 --> 00:40:18,760 Because now that we've added those other three years our average is back down to six percent. 408 00:40:20,040 --> 00:40:28,680 The 7.3 caught my attention today. Yeah yeah so six is way too risky. 409 00:40:28,680 --> 00:40:35,880 Okay but but that but that brings us back to this question of 410 00:40:35,880 --> 00:40:47,800 and and it's it's one of those of at 210 at 210 if we did five percent we're talking about four cents 411 00:40:49,880 --> 00:40:52,360 is 210 still a good number. 412 00:40:52,360 --> 00:41:01,640 No I mean I just I think I think that's I think we have I think we have to be we have to be asking 413 00:41:01,640 --> 00:41:08,680 the question whether or not we feel like we can sell the voters 210 with a with a four cent tax 414 00:41:08,680 --> 00:41:14,360 increase or do we want to sell the voters 210 with a five cent tax increase or do we want to 415 00:41:14,360 --> 00:41:20,680 tell the voters we're going to do 180 million and it's going to be a three percent. I think I think 416 00:41:20,680 --> 00:41:26,520 those are the scenarios we've got to be painting for the whole committee is is that we can't simply 417 00:41:26,520 --> 00:41:35,800 say we're at 210 because what we know is our costs have gone up and and what are we prepared to ask 418 00:41:35,800 --> 00:41:42,120 what what do we think we can sell the voters on this and and and I think we're I think we're 419 00:41:42,120 --> 00:41:46,760 pushing the limits and we did say we were going to bring back scenarios not scenario 420 00:41:46,760 --> 00:41:52,680 which I think is important to the whole committee but we haven't had any conversations about 421 00:41:52,680 --> 00:41:59,640 scenarios below 210 we have we have worked off of a 210 assumption. Colby Eric any thoughts on this 422 00:41:59,640 --> 00:42:01,480 you guys have been quiet? 423 00:42:06,200 --> 00:42:17,560 Oh I don't I mean I think probably they do were to address that concern that 424 00:42:17,560 --> 00:42:27,800 that Tim has raised in there is to first deal with the committee as a whole and then with the 425 00:42:27,800 --> 00:42:32,280 citizens and I'm not saying not to worry about how you present this to the citizens because 426 00:42:32,280 --> 00:42:37,480 obviously ultimately that's the goal but first and foremost I think we should probably address 427 00:42:37,480 --> 00:42:42,200 you know how we're going to do that as a committee but that's just really more of a 428 00:42:42,200 --> 00:42:46,600 kind of a how to handle it ourselves that's really not my thought I have on I mean 429 00:42:46,600 --> 00:42:56,440 if we need more money if you know it needs to be more than you know costs go up we should bring in 430 00:42:56,440 --> 00:43:06,760 a scenario of 230 is a two weeks ago 230 was not a plausible reality today it is right yeah but I 431 00:43:06,760 --> 00:43:13,080 mean that's just the nature of these and that's no money for land or street lighting those other 432 00:43:13,080 --> 00:43:18,600 things that were about 210. Well you could possibly cut to 70 million for street repair. 433 00:43:20,920 --> 00:43:27,400 Yeah there is a lot of street repair but there are shock absorbers in the 210 program it's just how 434 00:43:27,400 --> 00:43:35,480 much do we want to shock use those shock absorbers. So I think I'm I want to make sure I'm interpreting 435 00:43:35,480 --> 00:43:40,840 this right when we're talking about an extra penny and a half to go approximately to go from 436 00:43:40,840 --> 00:43:46,920 the 210 to the 230 and that sort of thing on these various scenarios the the rollback three 437 00:43:46,920 --> 00:43:51,800 and a half percent rollback difference in the final rate looks to me like it's a little bit less than 438 00:43:51,800 --> 00:43:56,920 a penny and a half is that correct it is but the rollback would not be if this would be only on the 439 00:43:56,920 --> 00:44:06,360 debt service side yeah so I understand legally that you you could continue to I mean the current 440 00:44:06,360 --> 00:44:12,520 projections show the M&O rate staying at the effective rate anyway right the rollback legally 441 00:44:12,520 --> 00:44:18,280 in my understanding of the new law is that it's just prevent or setting an upper limit that's a 442 00:44:18,280 --> 00:44:23,480 little bit lower of how much the M&O rate could increase if you weren't going to take it to the 443 00:44:23,480 --> 00:44:33,000 effective rate right over the effect over yeah and so so I'm just trying to wrap my head around if 444 00:44:33,000 --> 00:44:40,600 if you add an extra penny and a half I don't know how the voters will interpret saying that 445 00:44:40,600 --> 00:44:48,040 it's going to be a you know $40 increase but then realizing that their taxes are are effectively 446 00:44:48,040 --> 00:44:52,760 going up more than that three and a half percent that they thought sure right I guess I would 447 00:44:52,760 --> 00:44:58,200 address that by saying the debt service tax rate is always will be driven by this election so by 448 00:44:58,200 --> 00:45:02,760 by the voters voting for the election in that case they would be voting for that increase 449 00:45:02,760 --> 00:45:08,680 whereas the rollback is specifically on the M&O side so to go above the one and a half you know 450 00:45:08,680 --> 00:45:13,320 the one and a half cents estimate now and over that three and a half percent rollback would 451 00:45:13,320 --> 00:45:18,360 require a separate election so I think they're just two different paths so to conflate them gets a 452 00:45:18,360 --> 00:45:26,760 little yeah so I guess then my question is are the 30 40 50 dollar per hundred thousand valuation is 453 00:45:26,760 --> 00:45:34,280 that just the amount for the debt service not including the M&O rate at all correct and I'll 454 00:45:34,280 --> 00:45:40,360 use that to to say also you know the 210 million dollar number came from the discussions with city 455 00:45:40,360 --> 00:45:46,520 council of looking at the total tax rate of okay 210 million dollars keeps us below our total tax 456 00:45:46,520 --> 00:45:52,200 rate throughout but whenever as we go through the bond process the shift the focus just shifts in 457 00:45:52,200 --> 00:45:56,200 language to the debt service side because that's what's really impacted so we say here's how much 458 00:45:56,200 --> 00:46:01,000 the debt service rate could increase but we really focus a lot on that total tax rate so that's where 459 00:46:01,000 --> 00:46:06,040 it gets a little yes I think that's where I'm coming from is just that from from the numbers 460 00:46:06,040 --> 00:46:13,720 it looks like if you were to take on the 230 million then in order to keep the total tax rate from 461 00:46:13,720 --> 00:46:24,520 sorry in order to keep the the total effective tax rate if you will right from rising more than 462 00:46:24,520 --> 00:46:31,000 three and a half percent per year including the M&O and the debt service the M&O rate would have 463 00:46:31,000 --> 00:46:38,040 to decline so that it was actually below the effective rate is that accurate yes in certain 464 00:46:38,040 --> 00:46:42,840 scenarios but I would you know that's not something that um that we look the effective rate isn't 465 00:46:42,840 --> 00:46:48,200 calculated that way I understand I guess I'm speaking more from the purview of what you were 466 00:46:48,200 --> 00:46:54,600 saying that the council was originally looking at what could the bond support that would that would 467 00:46:54,600 --> 00:47:01,480 keep the the total tax rate from rising right beyond a certain amount okay yeah and that else 468 00:47:01,480 --> 00:47:07,640 I'll tell you here we bet I think that was the 100 million dollar number initially that yeah that 469 00:47:07,640 --> 00:47:11,880 we were estimating so that's where I think was Councilmember Meltzer asked to look at use that as 470 00:47:11,880 --> 00:47:19,000 sort of the bottom of the floor you know we very early on recommended starting to plan for bond 471 00:47:19,000 --> 00:47:24,600 election because we had a feeling that the state was going to cap us and put us in this position 472 00:47:24,600 --> 00:47:30,120 anyway so it's like well why not play by the new rules but you're right it gets down to where's 473 00:47:30,120 --> 00:47:36,360 where is that M&O rate and that service rate going to be when that cap goes into place so had we not 474 00:47:36,360 --> 00:47:42,680 taken this approach that we further eroded the M&O rate and we've got probably another six or nine 475 00:47:42,680 --> 00:47:46,680 for instance firefighters were trying to get put on this this next year it would have completely 476 00:47:46,680 --> 00:47:51,400 taken our ability away to do that and delayed opening station aid so you're right and how you're 477 00:47:51,400 --> 00:47:54,840 interpreting it and I just wanted to share with you that's kind of how we found our way through 478 00:47:54,840 --> 00:47:59,160 getting out to the voters because we we just simply couldn't continue driving that rate down 479 00:47:59,160 --> 00:48:08,440 knowing that we're going to get tax cap this year okay so so I'd I'd like to just we were saying 480 00:48:08,440 --> 00:48:15,560 it's not our purview to talk about about cutting but I think we've got to we've got to paint some 481 00:48:15,560 --> 00:48:24,360 scenarios that that said that say here's a scenario that is at I'm just using this arbitrarily 180 482 00:48:24,360 --> 00:48:32,520 million and and to get to 180 million would involve this and and and this is what you need 483 00:48:32,520 --> 00:48:39,160 to understand is the committee as a whole at 210 this is what this looks like and this new 484 00:48:39,160 --> 00:48:46,680 number of 230 this is what this looks like and and but but I think we've got to I don't think 485 00:48:46,680 --> 00:48:54,360 we should just be walking in saying it's 210 or 230 no no but I but I but I think we I think we 486 00:48:54,360 --> 00:49:03,560 have to ask the question in here well how do you get to that lesser number and that's where 487 00:49:03,560 --> 00:49:09,080 I think the whole community should be yeah I don't believe we can say 488 00:49:09,080 --> 00:49:17,160 from Ryan well but here's but here's but here is here is one way to get there I think otherwise 489 00:49:17,160 --> 00:49:25,320 it'll be chaos if we're if we're trying to cut in a group of 25 if we're trying to figure out 490 00:49:25,320 --> 00:49:31,720 how to get there in a group of 25 I think it'll be chaotic I think if we were to say this is one 491 00:49:31,720 --> 00:49:38,200 scenario that is a start a thought starter and that from the thought starter then people would 492 00:49:38,200 --> 00:49:44,040 say well I'd like to see this instead of that if we're going into that range it may be the 493 00:49:44,040 --> 00:49:48,920 committee's going to say let's go for the two full full 230 and six and a half cents 494 00:49:48,920 --> 00:49:56,600 but I but I think we have to see I think we have to see that in terms of what are 495 00:49:56,600 --> 00:50:03,000 what are the options and the scenarios of of something that is lesser 496 00:50:07,160 --> 00:50:14,440 okay so that's a proposal to we could just grab a number out of the air 497 00:50:14,440 --> 00:50:19,800 so let me ask my question was is where did 180 come from in your mind is that 498 00:50:19,800 --> 00:50:29,880 it's why not 190 it's because it's less than 200,000 that's a terrible answer so that's true 499 00:50:29,880 --> 00:50:37,640 we I think it would be a good idea to give them a number less than 210 but I don't think that 500 00:50:37,640 --> 00:50:43,080 as a group here we should be picking and choosing which ones would go in there we would say okay 501 00:50:43,080 --> 00:50:50,600 here's 180 what can we do at that level as a whole group well but I but I think I think the 502 00:50:50,600 --> 00:50:55,960 question I guess the question I would want to ask is in order to get to that number 503 00:50:57,640 --> 00:51:06,520 what is it that that we would be pulling from we've got 70 million and in road reconstruction 504 00:51:06,520 --> 00:51:12,280 and is that the only place that happens or do we talk about some other project that we 505 00:51:12,280 --> 00:51:17,000 defer and what is the impact of deferring that project and that's something the whole committee 506 00:51:17,000 --> 00:51:24,840 well but I think I think we can get that ball rolling oh we can prime the pump 507 00:51:26,840 --> 00:51:33,880 and this was I'm just gonna throw out a couple ideas that I had bounced off of David is you know 508 00:51:33,880 --> 00:51:42,520 70 million was for road reconstruction was based on you know x oci factor I think 509 00:51:42,520 --> 00:51:46,680 everything 10 and below the pretty close 510 00:51:50,040 --> 00:51:58,680 what's that 25 okay so maybe we say well we're only going to tackle pick a number 15 and below 511 00:51:58,680 --> 00:52:08,440 so that was one when I say shock was over that there's not a hard requirement like a 512 00:52:08,440 --> 00:52:15,240 renovation of the police station you know it's a level of service number does that track with you 513 00:52:16,120 --> 00:52:20,200 we're going to have this x level of service the other area we could have 514 00:52:20,200 --> 00:52:26,440 where we there's some flexes do we is ryan road do you go with the you know the big ryan road or 515 00:52:26,440 --> 00:52:32,440 the little line ryan road or no ryan or no ryan road because there's some other things in the 516 00:52:32,440 --> 00:52:41,880 bond package higher up that address some of those concerns so I mean if if you're going going back 517 00:52:41,880 --> 00:52:48,360 to your point I think if you were to say hey we're going to a plausible scenario would be say we're 518 00:52:48,360 --> 00:52:55,960 going to go from funding everything that's 25 oci and below to 15 oci below I don't know what that 519 00:52:55,960 --> 00:53:02,200 number is but I guarantee you it's probably going to get you below 200 million dollars 520 00:53:02,200 --> 00:53:10,760 and to me that's a starting point to have a conversation which is what I think what you're 521 00:53:10,760 --> 00:53:17,640 trying to get right right and and so remind me a penny and a half is 14 14 million our penny is 522 00:53:17,640 --> 00:53:24,840 14 million right so if we so if we were at 196 we we're talking about reducing this by a penny 523 00:53:24,840 --> 00:53:33,480 at 196 uh it's it's I felt comfortable saying 14 million is a penny to increase um and that's 524 00:53:33,480 --> 00:53:37,320 that's still contingent on when you when you time the increase as we decrease it's a little more 525 00:53:37,320 --> 00:53:41,880 complicated because that's kind of impacted by debt service falling off um I would imagine that's 526 00:53:41,880 --> 00:53:47,720 a little tougher to estimate but for argument's sake you could kind of talk through those scenarios 527 00:53:47,720 --> 00:53:52,360 but we could get the detail on it on any of those so and and I and and I'd love to know what that 528 00:53:52,360 --> 00:53:59,560 number is because if you're at 182 is that two pennies and and then that's that's that impacts 529 00:53:59,560 --> 00:54:05,640 some of what we're talking about here and by the way let me just say I'm not necessarily saying 530 00:54:06,200 --> 00:54:15,320 that that we need to reduce but I am saying that I think we need to have some some options 531 00:54:15,320 --> 00:54:24,840 of understanding the impact of of a lesser amount on on what the tax rate might be 532 00:54:24,840 --> 00:54:30,520 what the debt load is going to be and how how our community is going to respond to that 533 00:54:35,640 --> 00:54:39,000 Dave I see guys lined up in the hallway are we starting at six or 534 00:54:39,000 --> 00:54:41,720 we're starting at six okay they're just they're just excited to be here 535 00:54:41,720 --> 00:54:46,600 okay works off 536 00:54:46,600 --> 00:54:55,480 so so we need to put a bow on this conversation I'll just say you know at the last meeting we 537 00:54:55,480 --> 00:55:00,520 did bring those kind of hundred million dollar 150 million dollar 200 million 210 dollar scenario 538 00:55:00,520 --> 00:55:05,160 so we could they haven't been updated uh based on the feedback from the last meeting we could bring 539 00:55:05,160 --> 00:55:09,080 you know 180 million dollar scenario to get the exact numbers or at least kind of send that out 540 00:55:09,080 --> 00:55:14,680 to the group um that would be no no problem it'd be easy to come up with the same analysis at 180 541 00:55:14,680 --> 00:55:24,120 million and send it out to everyone does that sound randy yeah so I'm assuming we we are we 542 00:55:24,120 --> 00:55:31,560 agreeing on five percent growth in the ad in this group I think there's I think there's pretty 543 00:55:31,560 --> 00:55:37,400 strong consensus on that unless someone would have y'all see otherwise yeah I mean I think that 544 00:55:37,400 --> 00:55:44,040 sorry but my understanding is that that's that purely drives the information in the 545 00:55:44,040 --> 00:55:50,920 informational content I forget the term used for the that piece of paper that would be posted 546 00:55:50,920 --> 00:55:57,080 it drives that but it also drives the bond booklet which is um a number that's referred 547 00:55:57,080 --> 00:56:01,400 to quite a bit and then as we get as we the bond oversight committee as it's formed they do take 548 00:56:01,400 --> 00:56:07,560 note of that that increase as we plan for future bond year choices so we we are tied to it to some 549 00:56:07,560 --> 00:56:13,000 I mean it's not a number that we wouldn't we go over in the future years but it is it is the case 550 00:56:13,000 --> 00:56:20,200 that the voters are authorizing up to x amount of an increase so that they that that percentage 551 00:56:20,200 --> 00:56:26,120 number of four cents that the ballot language would say that that the voters are authorizing 552 00:56:26,120 --> 00:56:32,280 up to four cent tax increase to do this right it's not they don't actually it's in the booklet but 553 00:56:32,280 --> 00:56:40,120 it's not in any official language but I'll defer to yeah right that the voters are simply approving 554 00:56:40,120 --> 00:56:47,000 up to a principal amount of bonds but um it's not they're not voting on a tax limitation in 555 00:56:47,000 --> 00:56:55,720 fact we try to make that clear in the information that that they're not doing that um because the 556 00:56:56,120 --> 00:57:02,360 when bonds are issued there's a pledge of taxes and the city's committing itself to levy taxes 557 00:57:02,360 --> 00:57:09,160 sufficient to pay that debt service on the bonds okay yeah i mean i think in the uh the example 558 00:57:09,160 --> 00:57:19,000 uh resolution here it's the language it uses is and shall uh city council be authorized to levy 559 00:57:19,000 --> 00:57:25,160 and cause to be assessed and collected annual ad valorem taxes in the amount sufficient to pay 560 00:57:25,160 --> 00:57:31,240 the annual interest on said public securities but i but i would have in turn but from a from an 561 00:57:31,240 --> 00:57:37,000 actual staff perspective we would not go we would not increase more than that amount um without 562 00:57:37,000 --> 00:57:40,920 talking with bottom second without talking to city council it would be something you know that we 563 00:57:40,920 --> 00:57:44,600 would abide by obviously we haven't had to deal with that with the most recent with the packages 564 00:57:44,600 --> 00:57:50,200 recently because av has exceeded those expectations but um we would not just go over say we said we're 565 00:57:50,200 --> 00:57:54,840 going to go four cents we would not just go over four cents without having um you know those serious 566 00:57:54,840 --> 00:58:00,280 discussions so you're saying that if you if it looked like you were going to run into that 567 00:58:00,280 --> 00:58:06,760 situation you might slow down the issuance i think we would yes that was most likely no matter what 568 00:58:06,760 --> 00:58:09,800 we would have the conversation with the bond oversight committee and city council before 569 00:58:09,800 --> 00:58:16,760 we would do anything okay randy you were going to make a comment i thought no i just um well 570 00:58:16,760 --> 00:58:24,120 you know i think we we've just started or i don't know if we've gotten it all back yet though we've 571 00:58:24,120 --> 00:58:30,200 asked all the members to write projects right we're going to get that today we got it at 401 572 00:58:30,200 --> 00:58:36,040 okay and you move it out and we'll have those results today we had 15 members over the 19 573 00:58:36,040 --> 00:58:42,600 respond to that and i think you know the way we've done it in the past is we've had kind of here's the 574 00:58:42,600 --> 00:58:50,280 here is the assumed growth here's what the tax potential tax increase is tax rate increase is 575 00:58:51,320 --> 00:58:59,480 if the line comes across it's it's 180 it's 190 and whatever it is and you start ranking projects 576 00:58:59,480 --> 00:59:06,440 and when you get 190 that's it and so ultimately that's what we're going to get to right right but 577 00:59:06,440 --> 00:59:14,840 i think you know we can we can get there real easy if we assume a 10 percent growth perfect 578 00:59:14,840 --> 00:59:21,400 right but we don't want to do that we want to be something reasonable so and i'm getting less and 579 00:59:21,400 --> 00:59:29,240 less comfortable with the five because when we take that downturn period in we're at six that's pretty 580 00:59:29,240 --> 00:59:37,880 there is going to be another downturn there always is all your pessimists i think uh just 581 00:59:37,880 --> 00:59:40,680 the discussion you are having that was one of the reasons we wanted to make sure we 582 00:59:40,680 --> 00:59:45,080 touched on the police the public facility changes before you had this discussion 583 00:59:45,080 --> 00:59:49,480 so you weren't all just good with the 210 knowing that there is that significant variable out there 584 00:59:49,480 --> 01:00:00,360 now so is is that going to be into put into the a new uh spreadsheet of this is what these 585 01:00:00,360 --> 01:00:05,080 projects are going to cost that will be presented to the to the committee yeah well we presenting 586 01:00:05,080 --> 01:00:12,440 this um just here in an hour or so where we kind of um a lot of power points 587 01:00:12,440 --> 01:00:18,200 kind of show the differences obviously a lot of numbers but to just kind of show this is what 588 01:00:18,200 --> 01:00:24,200 we've been working on so far um and then here's just if you compare these two where we're looking 589 01:00:24,200 --> 01:00:30,120 at 217 to 252 in the options from up to that 238 but you can see the increase really is just that 590 01:00:30,120 --> 01:00:35,480 and then prop one going from 45.5 to the 66.9 591 01:00:35,480 --> 01:00:40,680 and showing you this banner to kind of just get to that point of 592 01:00:40,680 --> 01:00:46,280 we either i think the options are you go over that 210 like as you've been discussing or you 593 01:00:46,280 --> 01:00:50,760 just kind of look at the reprioritization of projects um to get to the level that the committee 594 01:00:50,760 --> 01:01:05,400 would like to be out and and and what about lighting in open space i mean it's now 595 01:01:05,400 --> 01:01:14,440 correct me if i'm wrong you did say dmne is looking at some of the street lighting or we 596 01:01:14,440 --> 01:01:19,560 could do some funding through yeah we're doing we're doing a number of small projects right now 597 01:01:19,560 --> 01:01:25,320 prioritizing those basically through the dme operating fund but there's other ways that you 598 01:01:25,320 --> 01:01:30,840 can you could certainly have dme you know do the projects and charge the city back there's lots of 599 01:01:30,840 --> 01:01:35,560 ways you can get there for some of these smaller projects if they if they want you know that would 600 01:01:35,560 --> 01:01:41,640 be our next round of utilizing any one-time dollars that would be fine in future budgets but 601 01:01:41,640 --> 01:01:47,080 that's basically how we'd have to tackle that and the right now in the dme forecast for future 602 01:01:47,080 --> 01:01:51,960 budgets there's going to be five million allocated just for going out and increasing street lights 603 01:01:51,960 --> 01:01:53,960 um a lot of the local and city streets 604 01:01:53,960 --> 01:02:02,760 well it's going to be an interesting meeting at six o'clock 605 01:02:02,760 --> 01:02:11,400 do you do you want to have another um finance meeting next week prior to that 606 01:02:12,120 --> 01:02:18,840 i do y'all might get some feedback from the total group from what they think about the total 607 01:02:18,840 --> 01:02:26,280 look at the look at the priorities just feedback on what the total package is all both props are 608 01:02:26,280 --> 01:02:36,120 and then we might be before the next meeting just to okay look again and say okay if they say figure 609 01:02:36,120 --> 01:02:42,520 out what is going to how much needs to be or there's a landing to draw on to get to this point yeah i 610 01:02:42,520 --> 01:02:46,280 i think that's prudent i think we need to give the committee some more input into what we're 611 01:02:46,280 --> 01:02:52,280 looking at because i feel like they're starting to say who's driving the trailer yeah yeah we 612 01:02:52,280 --> 01:02:56,520 had built in another another meeting or so we're not meeting with the council until the first of 613 01:02:56,520 --> 01:03:00,840 august so we'd built in another meeting or so just to give ourselves a little bit of flexibility and 614 01:03:00,840 --> 01:03:05,560 based on what we just learned with the two pd projects it's quite wise we take that the last 615 01:03:05,560 --> 01:03:11,000 time we want anybody feel like we're pushing them into a corner so we need to make sure they're as 616 01:03:11,000 --> 01:03:15,560 comfortable as possible with whatever they're recommending and and during the six o'clock 617 01:03:15,560 --> 01:03:20,760 presentation my plan would be to show this slide to the entire committee at the summary level 618 01:03:20,760 --> 01:03:23,880 obviously if more people in the community want to get in the more in the detail the other ones we 619 01:03:23,880 --> 01:03:28,520 can bring this whole presentation up but i think this might set the stage for some of that conversation 620 01:03:30,040 --> 01:03:37,080 tod i don't want you to take this the wrong way but are there any more surprises coming 621 01:03:37,080 --> 01:03:43,400 i'm not taking it the right way or wrong way i can remember being here a month and 622 01:03:43,400 --> 01:03:50,520 in getting my ears chewed off by you and randy and everybody out of the bond committee about how 623 01:03:50,520 --> 01:03:55,960 how can we be this short of money so i've got to never let that happen again i i don't think so 624 01:03:57,560 --> 01:04:01,960 i think tod and pretem i have i have grilled them and grilled them to go back two and three 625 01:04:01,960 --> 01:04:06,840 different times looking at the uh the road numbers the contingencies you know are we 626 01:04:06,840 --> 01:04:12,120 are we being way too conservative just in fear of not being wrong and i think they both feel very 627 01:04:12,120 --> 01:04:16,360 comfortable uh given the bids that they're receiving what they're how they're seeing the 628 01:04:16,360 --> 01:04:21,960 projects escalate and uh and really what what our existing bids are coming in at to base it off 629 01:04:21,960 --> 01:04:27,240 that's really all you've got in a hot economy is what are your bids coming in now um i think with 630 01:04:27,240 --> 01:04:33,000 the two i've been more nervous about the vertical construction because almost every project we've 631 01:04:33,000 --> 01:04:37,960 seen in this city the last since i've been here we have been way off on the numbers you know we'll 632 01:04:37,960 --> 01:04:43,240 get a planning number and these these little buildings are doubling in price on us so that's 633 01:04:43,240 --> 01:04:47,800 why we went out and hired this firm that has been working with lewisville and richardson and 634 01:04:47,800 --> 01:04:52,440 richardson's just finished checking up an 80 million dollar police facility and they basically 635 01:04:52,440 --> 01:04:57,640 came back and said your numbers are not taking proper inflationary numbers into account and you 636 01:04:57,640 --> 01:05:03,880 need to adjust them so i'm glad we did it i don't like getting this news this late but i think we're 637 01:05:03,880 --> 01:05:11,320 okay um in terms of the street lighting and open space honestly the open space is just a guess that 638 01:05:11,320 --> 01:05:17,080 target is moving constantly as we as we superheat in the economy here and the price we're looking at 639 01:05:17,080 --> 01:05:23,560 80 000 dollars an acre today which is probably double what it was five or ten years ago so i feel 640 01:05:23,560 --> 01:05:29,240 comfortable with the roads and i feel much more comfortable with the buildings now but you know 641 01:05:29,240 --> 01:05:33,320 the worst thing that we could have done to put you in a position of going out and selling a bond 642 01:05:33,320 --> 01:05:38,840 package and then coming up 60 percent of the money and said oh boy i mean we just had to go back to 643 01:05:38,840 --> 01:05:44,840 the council last year and asked for 35 million to make the local roads whole so and and i and i just 644 01:05:44,840 --> 01:05:51,720 want to say i appreciate that it's it's just it's a little shocking i know well i was on vacation 645 01:05:51,720 --> 01:05:57,080 last week and baby got a hold of me and uh you know i i if you've ever heard you could imagine 646 01:05:57,080 --> 01:06:00,600 somebody trembling while they're writing an email you know i can hear his voice cracking going we've 647 01:06:00,600 --> 01:06:05,800 got a problem here so but you know we just have to deal with it move on i mean it's just it's the 648 01:06:05,800 --> 01:06:13,400 economy we're in and it's the labor shortage we're in and i'm sorry to keep asking questions and or 649 01:06:13,400 --> 01:06:23,800 making comments but on the ryan road with that big gap the 210 is a fully funded 19 million on 650 01:06:23,800 --> 01:06:29,080 ryan road that's actually right just kind of cutting the and someone in the middle at 8.6 651 01:06:29,080 --> 01:06:35,080 million i hope right now so um and to be honest that that number i we've had the conversation 652 01:06:35,080 --> 01:06:40,440 with todd and pretam about um ryan road yesterday i think no matter where we end up as the four 653 01:06:40,440 --> 01:06:45,560 million is going to be kind of the basic basic road and as you incrementally go up it just you 654 01:06:45,560 --> 01:06:50,120 get more that goes with the road more capacity on the road all the way up to the 19 million so 655 01:06:50,120 --> 01:06:54,840 you can't pick a number in there there's going to be a varying level of service and uh that goes 656 01:06:54,840 --> 01:07:00,440 along with the road for now to be honest that 8.69 that was really put everything else in there and 657 01:07:00,440 --> 01:07:05,880 that's what we had left over so we put that into the ryan road for the again that's just the staff 658 01:07:05,880 --> 01:07:11,160 recommendation column is just there for um discussion purposes i think we have ranked 659 01:07:11,160 --> 01:07:17,880 these projects from a staff level and our priority um you can see the police renovation and fire 660 01:07:17,880 --> 01:07:21,880 station eight then substation and fire range being last and then the roadways are all ranked by 661 01:07:21,880 --> 01:07:28,360 priority um but as far as the 8.6 i think that's a conversation that committee should have and one 662 01:07:28,360 --> 01:07:35,400 thing on these road projects ryan robinson uh jim crystal that's that's all in design money but 663 01:07:35,400 --> 01:07:40,920 one of the exercises we recently went through and had all of our water and wastewater impact fees 664 01:07:40,920 --> 01:07:45,400 assessed and we found that we were collecting about half of what we needed to based upon our 665 01:07:45,400 --> 01:07:50,440 projections of when the next treatment plan expansion was the street this the street impact 666 01:07:50,440 --> 01:07:56,040 fees are even worse shape so they're probably collected somewhere between 10 and 20 percent of 667 01:07:56,040 --> 01:08:00,280 what it's actually costing us to build roads it's been so long since they've been properly updated 668 01:08:00,280 --> 01:08:06,520 and there's the formula is a little bit strange so we've hired um kimley horn to come in and help 669 01:08:06,520 --> 01:08:09,880 us update that so we're going to be going to council sometime in the next few months 670 01:08:09,880 --> 01:08:14,920 talking to them about the street impact fees and what what should the development community be 671 01:08:14,920 --> 01:08:21,720 pitching in so we can address roads like ryan and robinson in the future with with impact fees that 672 01:08:21,720 --> 01:08:26,920 are more reflective of today's costs so even if some of these end up getting cut we're still going 673 01:08:26,920 --> 01:08:31,000 to be building up those impact fee dollars trying to address these roads eventually putting them 674 01:08:31,000 --> 01:08:35,640 together probably with co funding down the road there's just not going to be much of a choice 675 01:08:35,640 --> 01:08:41,480 you know bonnie bray and hickory creek especially bonnie bray is just if there's one that's 676 01:08:41,480 --> 01:08:45,480 untouchable it's probably that one because of the high school opening up the need to get off that 677 01:08:45,480 --> 01:08:53,640 road eventually especially before they start that construction on i-35 north but beyond that i mean 678 01:08:53,640 --> 01:08:58,200 we will figure this out um based on wherever your comfort level is 679 01:08:58,200 --> 01:09:13,560 so one thing would be um a little helpful for us and you guys may or may not have an 680 01:09:13,560 --> 01:09:24,600 opinion on this but i'm actually going to get to be a teacher for a second so we're not getting to the full five cents 681 01:09:24,600 --> 01:09:28,920 right away right so there's some capacity to do things a little faster which means you can 682 01:09:28,920 --> 01:09:33,800 probably afford a little bit more within the same five cents right what you're telling people 683 01:09:33,800 --> 01:09:38,680 and where i'm seeing that and obviously we don't want the total tax rate to go up right we're 684 01:09:38,680 --> 01:09:44,280 sensitive to that but you know for example here the total tax is stopping one cent but we still 685 01:09:44,280 --> 01:09:49,720 haven't hit near the five cents so we can take that one cent and use it i guess which means we're 686 01:09:49,720 --> 01:09:58,840 paying out that faster and i'm not saying that's a solution but if there's a we can't live with more 687 01:09:58,840 --> 01:10:03,400 than five cents or whatever that is we can structure around that a little bit more right now we're using 688 01:10:03,400 --> 01:10:10,200 numbers and timing based on what's given us um so it's like roughly 90 of the 210 leg is sold within 689 01:10:10,200 --> 01:10:15,720 the first 10 years then it kind of tapered off so it's a little bit wondering why did we do it that 690 01:10:15,720 --> 01:10:22,680 way you could back into how much could you afford every year sort of maxing it out right i'm saying 691 01:10:22,680 --> 01:10:26,760 next thing i mean the total constraints that your total texture doesn't go up and that we're not 692 01:10:26,760 --> 01:10:31,160 going to bust the five cents and whatever makes sense you're just going to use a different forcing 693 01:10:31,160 --> 01:10:39,240 function to yeah i mean we can but that's one thought to maybe you got a little bit more within 694 01:10:39,240 --> 01:10:43,880 the same constraints that everybody's talking about i mean it a lot of people don't really think about 695 01:10:43,880 --> 01:10:49,240 how do i want that tax rate to look um or how palatable is it for it to you know doesn't really 696 01:10:49,240 --> 01:10:52,520 need that many like you said this school don't really differentiate between that sort of no no 697 01:10:52,520 --> 01:10:57,800 they're looking at the total tax rate so this is already a communication challenge with um voters 698 01:10:57,800 --> 01:11:03,400 no doubt but knowing that if we're mindful of the several tax rate and how this ultimately gets 699 01:11:03,400 --> 01:11:08,600 implemented you're probably still you know ease up the debt service tax rate a little bit faster 700 01:11:08,600 --> 01:11:14,760 within like so not reaching that estimated maximum tax rate that's being communicated that's important 701 01:11:14,760 --> 01:11:22,200 great thank you and i briefly showed the bond sale you know this this is kind of this is what 702 01:11:22,200 --> 01:11:27,480 was driving those numbers but that these are just estimates but i think to that point you know 703 01:11:27,480 --> 01:11:31,400 how we how we actually sell the bonds is going to have that impact that's that variable on the 704 01:11:31,400 --> 01:11:35,800 rate that will be each year you know and i think that goes back to the av growth as well 705 01:11:35,800 --> 01:11:42,280 you say five percent every year but maybe in 21 22 at seven percent and then it drops off that 706 01:11:42,280 --> 01:11:46,600 kind of how we looked at that variable rate last time um so there's going to be those considerations 707 01:11:46,600 --> 01:11:53,480 as we go through that's going to really change the target and also using the old numbers not the 708 01:11:53,480 --> 01:11:57,720 middle oh yeah this is this was this was the old one that's why i kind of have this slide hidden 709 01:11:57,720 --> 01:12:04,760 behind the question um this is going to that's going to be a consideration obviously we're going 710 01:12:04,760 --> 01:12:08,520 to need more dollars here in 21 is keep on the schedule and that's going to have an impact on 711 01:12:08,520 --> 01:12:19,960 what we sell the rest of the day okay so just uh for for clarification um have another meeting next 712 01:12:19,960 --> 01:12:26,520 week at four four again possibly and bring back some 180 million dollar scenarios or kind of see 713 01:12:26,520 --> 01:12:29,800 how the discussion goes at six p.m and then go from there i think that's what we need to do is 714 01:12:29,800 --> 01:12:37,720 just say what does the committee feel is a what are the you know bring three scenarios get feedback 715 01:12:37,720 --> 01:12:42,120 in those three scenarios and then based on that conversation say yeah we need to meet or no we 716 01:12:42,120 --> 01:12:54,920 don't that's great does that make sense yeah okay pull back in there all right thank you thank you 717 01:12:54,920 --> 01:13:04,840 break adjourn i think you can move to pardon me think i need a motion to adjourn i'll move to 718 01:13:04,840 --> 01:13:12,360 adjourn i'll second all right all in favor say aye aye opposed same sign we're