##VIDEO ID:0Z-2fpKMiRI## e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e the development fees and the let's review first the U the sheet that I sent out which takes our list of fees that we had identified and what I did was this this sheet here okay all right okay it's called proposed fee changes and as you recall this is the the universal fees that we had discovered a couple years ago uh all throughout the code book and uh this is sort of like a um a scard for what's happened with the speed ordinance that's been proposed by the council uh we've got 99 we've got 89 slots filled but keep a note that the development fees include 18 separate application fees and 17 esro fees they're all different and that in addition to that um there is one other grouping that in fire prevention there's 12 separate fees as well so we have quite a few fees the ordinance that's been proposed by Council uh covers that's the24 yes no yeah that's yeah one the one and we want to give it give it this a quick end track review because it's on the next Council agenda for movement for consideration and public discussion so what you have in front of you is a scorecard of all the fees that have been change all the fees that we identified all the fees that have been changed and I personally just have two questions about about the list but we'll hold them till uh we review everything else now is anybody now keep a note by the way that Dennis I didn't what I didn't understand there were C some fees like tent permits $100 that I didn't see that being changed the only proposed why wouldn't something like 10 fee what okay thank you after everything I just said is I'm not repeating it okay so the comment anybody have any comments by the way about these fees I I have a couple if you want me to comment first I will go ahead um the the fee agenda the fee package was pretty well scrubbed the city did a very good job of scrubbing through these these uh fees and there were lots of fees that were taken off U the book we they're still on our list but and I I would assume and Morin you you can uh clarify this for me if you would what a fee is taken off let's say for example um the dry cleaning plant fee used to be $213 it's been taken off the list now does that mean I think it means that it goes over into the other business category that is correct okay that's what I did here on this list because all those all those fees hi PA I believe I read that that's going over into laundry what's yeah that's going to be combined with the laundry fee but all of these fees that were removed from the list uh are identified on on my list here by with the 300 and asterisk because all of those businesses now are not going to have their own separate fee they're going to have to pay the business fee that all other business on line 33 that's the way that the codes working yes so in some in some cases that means like for the nightclub for the dry cleaning that means that the fees or laundries that means the fees actually going to be reduced right well in some CA in most cases yes and in several cases it's been increased so and if you want to run a nightclub in Kate may we don't have one I don't think anymore but it's going to cost you $300 inad of what's that thousand yeah okay um so uh the question I had I actually had a question for Marin or Paul the uh on the residential rentals I'm concerned and confused why why the fees were reduced in that in those categories um the the ordinance reduces for example the the big one the Mig Mansion rent uh it was reduced by $200 and those are the categories that Sarah's identified as being um delinquent in their fee charges or fee payments so I was just wondering if we could talk about that for a while what was what's the rationale be between lowering those fees for the residential rentals yeah for the for the uh big ones so I don't know NE necessarily whether or not we uh targeted the big ones po doesn't I think we we evaluated the fees based on what it costs us to operate to do the work and it doesn't really cost us anymore and plus we were really aligning it for you know we've looked at changing it to bedrooms right so we looked at we looked at it so that look at how it's aligned in the pricing schedule when we convert to bedrooms that's going to be kind of the breakdown as we break it down into bedrooms so we were you know so that you know figuring those top two categories in square footage are really going to be the the top category in the bedroom category and that's the fee that they're going to be so it really would you we're changing the fee for them this year and then next year we're going to convert it to bedrooms and you know you might have one to go this way one to go that way based on square footage and and bedrooms but you know but it doesn't from a city perspective whether it's you know that top tier or the second tier down it doesn't cost the city any much more to manage and create that mertile permit which is was the point that the uh clerk made um and understanding the function and the work that she and her team do which is really why she you know said like year in year out that this is there is no more or increased expense to be able to process a mertile fee so we have to you know she she is the owner of the process she is the person who manages it so she understands the business um so that's why you see some of these adjustments this was very much based on Erin's input and one of her staff members who sat in on the meeting with and if you're looking about what's that they're going to require more city services uh that's reflected in their tax bill right right you know you know a larger square footage building is going to pay more in taxes and so that's where we that's where that we cover them in their cost for city services so Dennis I saw it as being Revenue positive because the largest category the smallest homes are going to be increasing by 25% so the re the revenue will be positive most likely yes where my concern comes in mostly is as Sarah pointed out last meeting the the area that we have the lowest level of compliance on a percentage basis are the larger homes okay so I want to stop hang on I want to give you an update because that's actually from Sarah's work it's not NE necessarily an audit was done internally after the information so Martin you can finish but I want to make sure that we explain what the audit did illustrate once we took Sarah's file okay so I I just think it's sending the wrong message by reducing their fees I understand the rationale for it and I don't fees shouldn't be political or punitive my reaction to it when I saw that those fees were going down was simply this was where we had the lowest level of compliance we know that many people with the larger homes are um their their listings are not accurate truthful um and and we're almost kind of rewarding them so that was my reaction I don't know that we do anything with that I just wanted to share what my thinking was so I think on going to the bedrooms which we've all agreed will happen next year um is a better measure because for the most part they are published on many of the sites like that they're going to illustrate how many bedrooms that they have they're published when they are being rented necessarily accurately published when they submit the paperwork the city right right so but we can validate that and we'll talk about that in a minute we did take Sarah's file which was a tremendous amount of work and it was you know a really good uh starting point for an audit tool um and I'll let Paul follow up on that but we did find that about a third of them were actually had Mercantile license of the number um there was a third that actually had um filed but did had not completed so they were in the clerk's system and waiting for followup a third did require followup and are being worked through um the city manager and code enforcement so it was a great exercise but you know two-thirds of them were had been either addressed in one form or another and had either an active mertile license or were deficient on on um a document or something like that yes um and so that there we were not as as as far out for the original numbers um and we've talked Paul is following up on the company right that uh was previously brought up to um Kevin for to to follow up with it's really much more in Paul's um and I think that I think that was the important part of what this did was showed the need you know definitively and you know the city will take a more proactive stance and maybe utilizing a company to to find those things so I think that was the positive that came out of that whole analysis was was that that's kind of the forward motion we all wanted to see when we made those recommendations that's great so let me let me float a proposal if we are moving to bedrooms next year why not just leave it alone for a year and then when we convert instead of converting it twice just do it once because then I it's better just to we're doing the fees this year and then you know that way we're not doing a double conversion and we've made we've put this out as an ordinance it's you know in the public space now um we've made the you know U decision to move forward it's been something that's been asked for I don't think at this point we want to dial it back for that one subsection and then have to roll it back out next year um I plus there's other components Aaron does need to work with the vendor sdl on some of these conversion changes uh the system process the system programming for them so having them in here doing everything at once makes much more sense she's also hopeful that they can move to an electronic version of mertile license renewals for next year so getting the vendor in here to do the programming makes much more sense to try and get all of those boxes ticks ticked if possible and I think Paul you would agree with that too so the V so you've made the decision which sounds great to move forward with the vendor it's going to do the audit it's going to not I mean we're looking into it it'll be it'll be something that will budget for for next year you're going to budget for it yes yes and we'll and we'll start that we'll start engaging with that vendor seeing what they need what their cost process is excellent and see what it is so I mean we haven't engaged them yet but yeah we are going to I'm going to make the commitment to to follow through with that yes that's great super okay and a third and listen a third is a third that's still great I mean no it is absolutely and that and that will be part of the ROI because um that was an audit sample but if you took a look and you know tried to value that you know that that's where the ROI comes so I will I will say that this is something the city has never actually done before u in a comprehensive way and uh it's a good it's a good start let may ask you a couple questions about about some of the fees uh there there's is there going to be I guess there is going to be a game plan to look at these other fees as well well uh shower fees the one all the ones on our oh oh the other ones on your list yeah we we we've started looking at different ones but you know we'll evaluate you know we have the uh land use development fees yeah that we have a proposed ordinance and I think we've asked you know I think Council wanted to get your recommendation of whether the analysis that we did for the land land use development fees was a a sufficient analysis for those proposed fees I know um I've been speaking with the fire prevention they're doing an evaluation for their sets of fees um I think uh uniform construction I think is you know I just got us some reports from Lou I don't anticipate he's going to make any recommendation he does his on an annual basis looking at his whole you know that's part of what he has to do to make a report to the DCA and to the council so I don't anticipate any change in the UCC fees yeah and it's been our position as a an advisory committee to to say that uh stale fees need to be examined and in a process that's that's regular and ongoing it isn't just isn't going to be a one shot and I and I think that some I think that's most of the fees that that we have out there I mean there might be some straggler fees out there but they're not not that fortune telling fee you going to get into that one I may you let me know you tell me tell me if if I'm going to get it or not do we have any for left sure on gy street oh okay no I was I was a little surprised on last page that the tent fee T permit fees were not increased there were there were some fees there in the last P that I looked at that I was a little surprised but that wasn't I mean that ordinance is for Mercantile so you know that right that's a different ordinance set of fees so I mean don't forget that you know your fee schedule was a comprehensive list of all fees throughout the city and this ordinance that we're talking about was just mertile not some of those so what ordinance would that be yeah they their their first attack was on ordinance 310 which covers all maril fees and the other attack was on ordinance 211 which is on the development feas which which those are the the bulk of of our Revenue fees that we we get tents and canopies are also a future Council agenda item it is all now here's one issue I want to throw on the table and Paul get your reaction to it when we went to in the fee lists um where is it it's um number 54 which is restaurant restaurant indoor and outdoor seating uh we went from 7 to 10 which is a reasonable I think that's what we recommended in our original but uh is the city going to be able to to Institute a study of the current state of restaurant seating in terms of its uh site plan versus its actual operation some of these Cod code enforcement routinely does that now they they do reconciliations between if they go do into inspection they'll double check between zoning and uh the Mercantile so it's it's routinely checked so okay so we're going to it's not every time but it's routinely checked later in the meeting we're going to discuss what kind of data we're going to be able to get to do some analysis from the city can we have a um a spreadsheet on on uh restaurant seating capacities and Reporting capacities well you'd have that from the mertile list of what they report there but that's yeah right what they report yeah what they report okay well well we're going to be able to get that then right uh yeah well Aon should be able to provide it for what they submitted for this past year I mean as yeah right uh is there any plan to to cross reference the reported seats on an annual basis with their original site plan we're not we do a routine compliance check I'm not you know that would be a big job I understand the pull site plans and cross reference but it it might be worth doing if you could well maybe maybe MRA will be volunteered to do that you know uh we used to send the compliance guy out spot checking and going through and actually actually doing the count do they do that yeah they do that that's why I just yeah they yeah they do do it yeah they don't do every restaurant every year but they they go around and they do compliance checks and I just didn't you share a report or I mean a couple of months ago I saw something that I think you you had shared with with me when I think I asked for it not a report I shouldn't say that but that Bill had been going out and Bill's been and they they report to you then guess or did they report to Deacon to to the police they're under the police so they they're under the police department yes can they make their reports to him yes Paul the indoor seating number for restaurants does that Encompass all the seats for a restaurant including I mean it says indoor seating does that include outdoor seating it's all one number no that's what I wanted well it depends on the type of permit and and you know so there are permits depends on how they get their outdoor permit seats they can have official outdoor seating or they can have a I I'll call it a flex seating where if they have some outdoor seating that's counted against their indoor seating that they can but they have to take away their indoor seating so there's there's two ways to get outdoor seating okay and it just comes back to site plan and compliance as well just right concern because but the outdoor seatings all get permits they get annual permits that's reviewed by code Zing officer I I know I guess it's just yeah I don't want to mix compliance with the with the SE with the number of seats but I just want to ensure that we're checking off both they do a routine they do routine compliance inspections yes when we went to outdoor seating in the covid era was it is it my understanding that the outdoor seating was not in addition to the indoor seating that it was a the same number transferred out to the street under covid it was a you couldn't increase your total number of seats it was out indoor seats that you had brought outside but so now we do it that's still in effect should yes under the outdoor if you if you get a outdoor seating permit under Section was 438 I forget what this section is um but but you could go to the planning board or zoning board and get a site plan amendment to have dedicated outdoor seating is anybody doing that which would be an addition to out indoor it's it's a different process but but so you know there are places in the city that have site plan outdoor seating that is in addition to their indoor seating and there are some that have outdoor seating that's flexed that's a subset of their indoor seating and there's some that have on the mall that have per you know Mall permit seating patio permit seating that is in addition to their indoor seating so there multiple ways that a business can have that outdoor seing but they get a mertile license they they deem and they they get a merti license under this code also they have to report the number of seats that's that determines indoor seating and outdoor seating and they pay a fee for both and but then how do we how do we ensure that those seats they're reported are not in addition to their indoor seats as I said for like the third time we do routine compliance inspections to make sure they're compliant okay gotcha but the process is that they would need to go to either zoning or planning board for a site plan review to add those seats if they want them to be permanently added seats yes ex except for the mall patio permits they don't need site plan approval for that and they're permanently added seats or not permanently but they're seasonally added seats has anybody done that what going to the planning board or zoning board get additional yes okay yes okay any other questions about the fee uh the development fee let's review that for just a second I Paul come oh you want to talk secret meeting in the B does every did everybody get a copy of that ordinance uh yep 544 y okay I don't know I made copies just paent give me a copy you didn't bring it with you you mean 2024 no this is the one which one this is the one that changes the de de development Fe want there there's three it was in the big docent 544 right yeah 544 do you have that yep do you guys have what's that no we're still in the phas does he want one better got it not at this point no well yeah you can bring it up we can talk about it I don't have a problem talking what we're doing here for this particular item was to just review that that that ordinance but you can talk about it if you want to not Ane add of it exceeds so Jules I watch a lot of the meetings on online I know it's very frustrating when I can't hear could you use a microphone I raised a question about the the uh the value of the seating on the mall has has become exceptionally high and it's it's city-owned property and I don't believe the city is is being compensated properly for the amount of the space that's now under rent to to the various restaurants and um I I I consider or suggest that you bring that up as part of your your overall increase in in suggestions to to the city it it is so I I'm not sure it is on our list of fees that we identified as being increased it's no no not being I'm not I'm sorry he's talking about are you talking about the uh the uh Mall permits patio permits yes Mall patio permits oh okay that's that's on your list is number 78 uh M patio permit that's in code 324 uh $2.50 per square foot that's what you're talking about yeah we didn't get to that those yet right yeah that is on our list of but we only tackled mertile and development fees to date that's that's all that's been it's not to suggest Mr Ral that it won't be looked at it's just that it hasn't okay yeah now wait a minute let's make it that a stronger statement not that it won't be it will be that the the city is committed to taking this list and filling all of these fees with that was my impression this was an overall review of fees it is I'm sorry I I I didn't realize what you were talking about for a minute but it is on our list it's it's we have it identified as a fee that needs to be examined the other suggestion I might make there's been a request for a number of years that when a meraner license is filled out that they put the date that their site plan was approved so that it gives the uh the department the opportunity to look back and see exactly what they did get approval for the other suggestion that I would make is that wait a minute let me write that down well if it was a planning board it would be when I think that date would be there someplace well in the last three years the planning board has not had an application for anything like this well there's been nothing new that's why Poss no there was something well if if people have applied for an additional out uh no I know where you're coming from ugly they originally they were paying for like 10 weeks of using that space now they're using it almost year round well they are using yeah I I hear what you're saying um yeah they're tripling it or quadrupling it all right the value of it has increased significantly I mean all you have to do is is look at the merchants and they ask them how much do you rent space for on the mall uh inside and they'll tell you what it was 10 years ago and today and there's probably a 200% difference the city's not getting that value out of their property that's my that's my point the other suggestion that I would make is that when a meranti license is filled out that they indicate the number of off street parking spaces that are provided as a mean means of having a complete evaluation or knowledge of each property that's now being being issued a meranti license we don't know how many spaces are available in the city and that that's the point that I'm trying to make we we need to know what those numbers are we've talked about that uh in fact one of our recommendations is just that that the uh when you apply for any kind of a license uh meraner license in particular the you have to report the number of parking spaces offset that you provide as per your site plan because in the site plan review you uh you have to identify that and then you if you get waivers then you don't have to provide that and then those those parking demands become a floating problem for all the city that's all that's all part of our original remember our our recommendation on parking so Solutions one of the parking one of the recommendations we made is that any parking solution has to begin with adequate funding and the adequate funding has to come from identifying that impact that meraner licenses have on the city's inability to provide adequate parking and and Fund Solutions to fix that that was a that was one of our recommendations several years ago yeah the tpa's looked at that for for many years with same the same issue U yeah it is I mean you got you got to look at a way U you got to look at the way to solve the parking Problem by identifying funding sources actually first and then you then you can go into the market of solutions and there are lots of solutions that uh the city just can't afford right now and could afford if they assessed the parking impact from off street parking or on the lack of on premises parking thank you all right any other questions I sah question um I know we have the updated masterless from Aaron on the cross reference mercant licenses yes right uh post audit is that something I should continue with right now or do we want to yeah we're going to we're going to do that the uh my plan was to take um we're we're only going to meet every other month so my plan was to ask the city to assemble that kind of data we already have the report from Aaron we need some other data to assemble a bunch of data for us to spend the two months looking at and at our November meeting uh we would be able to make some uh recommendations and decisions based on data okay all right so we're skipping and by the way Martin the beach stuff is is in that same category we we need to examine your report and we need to also examine uh the the in the individual Revenue coming from all those individual tags and see whether or not adjustments need to be made on that if you want to comment on that you can Martin I want to hear what you have to say so run that me one more time well we're going to we're going to we're going to use the the next two months to look at data uh we we want the city to give us all the numbers that your study requests yep and uh we have the numbers from for Sarah to look at yep and we have then we're going to expand this and look at the revenue from these meranti licenses over the over the the the uh full collection of them and then make recommendations based on what that data shows us so there's there are other recommendations in here are we still going to talk about those today or no I think we're going to hold off on that the issue is we start selling beach tags in December so so we wouldn't be able to implement changes if we don't talk about it till November we don't have many we don't have an opportunity to make changes to the 2025 structure I thought you still wanted an October meeting and you were going to do every other month from there you want a November meeting no uh we had started we had decided to we had started to go to every other month corre and we were going to skip September but then I asked if we can meet in September and then start the every other month I misunderstood that's right I'm sorry so our next meeting is not until November it's not until November no but uh to your point Martin what do you think we need to be able to tell Council prior to that well there was one specific recommendation with respect to additional categories of tags that we could consider doing um that would need to be digested by the city determined by city council and then implemented really by December 1st they also generally ask us for recommendation with respect to the beach fees themselves um whether we whether MTR feels that they should be increased or stay the same um and if we don't talk about it or wrap up the discussions we've already had until November there wouldn't be an opportunity to do that in time well okay um would you like to have a meeting in October what's up personally I would I it would I think wouldit be better on the beach tags because we give us okay time all right no right wouldn't matter much time okay okay you can if you want to plan for a proposal for 2026 yes but you can't start thinking about a new tag type because guess what we just sent out the letter to the the local schools about the the picture contest for the design for next year's tags the tag types for next year they're set so if you want to discuss tag types for 2026 you plan away I I don't know what type of tag types you're thinking about and I don't know but I mean I think we have more tag types than any other community in the state of New Jersey but hey you know if you if you've got an idea throw it up against the so one of theend that we have is that 75% of the towns in New Jersey offer a discount to seniors so we have a proposal to provide seniors with the opportunity to purchase tags at a lower rate than normal seasonal tags something like that doesn't necessarily require different tags but a different price which could be implemented by our proposal of January 2nd if we if if Council chose to do it it's it's actually a different tag type because it's a different tag design because we track them by the you know just from an auditing standpoint I can't do that I I understand what you're saying if you want to discount for seniors but I don't but but but there again I think it's I think it's a if that was a discussion that MTR really wanted you should have started this in the spring we can't start it a month before you know cuz to change it I have to do an ordinance an ordinance takes a month and I start selling and I start selling these in December so make it 2026 yeah so I don't need I don't think you need to do a special September meeting for for for Beach tack because I'll just tell you right now is the September meeting I mean not I don't I can just tell you right now we're not adding a different Beach tag type the the issue really separates into two things one of them is an analysis of the revenue generated in this past season and what kind of tags generated what kind of Revenue that's one thing the other issue is expanding the nature and and variety of tags those are two different issues and I think we will be able to get from the city all the revenue we estimate Revenue analysis we need by November on the we're looking back at what kind of money we collected all right all right that we're going to be able yeah I I presented preliminary numbers at the last council meeting no we we want to dig a little deeper into those numbers yeah so will will um I be able to get a copy of the tag report that I had requested yeah that's what he's going to give you it's not finalized so as soon as it's final that's why we're not going to meet next month right yeah as soon as we have the final numbers because if they change a little bit I'd rather you work if you're doing a full year analysis we'd rather you work on the final final numbers table the rest of the discussion until November I I I just want to make one point clear we did start this in the spring we talked about the fact that costs are increasing at a rate greater than revenues so you're looking at it discounting prices in years in years when the fees are not increased so we started talking about Revenue generation opportunities including additional tags for commemorative Valentine's Christmas tags back in April so I understand what you're saying that now at this stage it would be very difficult to do um so we'll have to add more lead time into our proposal to make sure that we wrap things up sooner yeah yeah a proposal especially for something like that has to be done we need at least you know a month just to adopted probably two months total three months even just to have the the public discuss of it okay okay okay I think we're we're squared away on that issue I I wanted to get the committee to give me some feedback on ordinance 544 and this is really a comprehensive review 18 application fees and 17 escrow fees uh Paul and his staff did a very good job of U examining what's going on in other towns so that we can have a frame of reference to whether or not our fees are adequate and um frankly I have no problem with that process that's the process we asked to have done yeah and and added to this was that the board secretary for both the planning and the zoning board yes um provided instrumental information on just what she deals with with applications coming through with applications that uh require revisions and modifications working with the board engineer and the amount of time and energy it goes into when those modifications and revisions come in um so this was really a way to ensure that there were Ade adequate funds in the escrow accounts to be able to cover the expenses associated with the board engineer um so that it didn't put the city in a rears um so it really was one the evaluation of development fees across the municipalities in the county and two uh with her understanding and input and what she has experienced in those that position uh for both the planning and the zoning board and working with the board engineer and understanding the work effort it really um seemed to be the the right time to make the changes yeah this is one of those areas uh separate and apart from meraner license this is one of those areas that really did need a a complete and comprehensive currency review it they're extremely stale they're they're extremely stale and um it it's the area of the code in which the fees can't be more than the cost for providing the services which is a critical point that I think you alluded to the fact that the process costs way more than the fees provided to coverage for and so these fees come right back into a consistent relationship between what it costs and what what the fee is I anybody else have any comments on this bunch of fees I don't I think it's a good job and uh I think it was well overdue I also think that the this I wanted commend the city for taking out section 211-2 the administrative fees U that that's sort of like one of the annoying things that the city's been doing to people for a long time aside from all the other fees they say here's a fee because we have some costs it it it's an amorphous document it generates more annoyance than anything else and I'm glad personally that was taken out so the idea by eliminating that you everything else is built into the fee itself you don't need right exactly I mean there's there's no point and and it it's identified with the service that's being provided is really what it comes my only comment uh when I saw it uh wasn't so much the fee itself or the changes uh do we have a good spot where when these fees are changed that we have a date when they were actually changed so that that can be maintained over years so we know how stale things are I think it would be helpful so one of the things that I've um said to to um the city manager and the CFO is there needs to be more of a calendar and the city clerk a calendar around these things now it doesn't mean and I've said this that fees will be increased at that pace it means that there's an analysis done so one of the things to be able to tie it to is if you get as close to the start of a of a calendar year as possible um so the development fees by the time this runs through um and actually becomes on the books as well as the mertile fees they will be pretty close to that period of time so we could earmark them for you know January or starting to look at them in um the summer let's just say of 2026 you know to make sure that we were keeping on Pace with Associated expens like the calendar I would just just in addition to the calendar there' be an actual date when the fee was put in place oh there will be by the or something like that something like this the list we did with the date on it that's that's all just like an index yeah I I I think also that what the city is doing is consistent with our recommendation we had asked for a regular review and a cost of living adjustment every other year uh if warranted for all these fees and this this is the beginning of that process uh I would suggest that we we uh in the next round of reviews that we look at the point that Mr rash made which was the mall in particular and whether or not those fees are sufficient to cover the cost so we'd be interested to know when the next round of of fee reviews will be taking place hopefully soon okay that it's going back to the development fees for a moment yeah I was I I listened to the city council meeting where the discussion was happening one of the things that surprised me was when we're talking about the percentage increase in a fee it's a relevant point but when we talk about the percentage increase in the escrow it's not really relevant because it's just a holding account so even if we double the escro amount because we don't want to chase money it's just you're going to get back whatever is used so it really isn't relevant that the escrow is being increased by 50% or 75% that's to reduce the effort of the city of going after the people to collect money right it it becomes an enforcement tool yeah right right yeah that you're right that's a good point that you're not really uh you're not really absorbing that charge if you follow what's what you're supposed to do and do you see it that way too yeah yeah because yes the refunds would be issued if there's any money left over and what they what they were finding is in some instances for people who unfort ly had a denial at you know a board meeting um they were unwilling to you know um put forth the additional funds uh which made the city have the responsibility financially to pay the board engineer and that's not necessarily the way it's supposed to work for those application renewals so this was a way to ensure that there were adequate funds all right there was there was discussion at the council meeting that uh Council was of a mind to to receive input from MTR on the advisability of this ordinance and uh so am I do am I hearing a motion that we endorse this ordinance as a great first step to uh implementing a a comprehensive and reliable way to set fees over time and and just to add to that Dennis that the the analysis that was done is sufficient associated with the development fee recommendations yeah right right right okay and again our recommendation this this may sound self-serving but our recommendation was not to set any one fee our recommendation was to update the way we approach fees with with with the understanding I think that um that the the short-term residential licenses are proposed to be moved to bedrooms in 20126 correct and also that there are additional fees such as the outdoor mall fees that need to be warant additional review yeah right exactly well we're anticipating another round of right in other words all this list we have there three-page list sooner or later is going to be filled all red on on the side here and as quickly as possible and by the way the the column under date we already started that it's incomplete because some of these feas it's hard to read the code for a particular paragraph in an ordinance cuz you don't know when that was changed you know when the ORD separate yeah Mar I think you had brought up brought the made the point that it would be a biannual review I I have suggested that once every two years now you know this I will say in all fairness to the clerk's office the CFO and the city manager I mean this was a significant undertaking to get everything together the first of all the information and then to sit through it um becomes more disciplined once you get through the process um and so what I have said is look regardless of whether or not we make increases look at the fees every two years should be done just so that we have more of a a business approach um to ensure that we are covering the expenses um and as I've mentioned in some instances those expenses are not going to change uh substantially so we may not see increases at any given time but the fact that we're looking at it and understand the if there if it's necessary and need it so yeah so for example the store fee went up the store fee went up by I think 15% um and hadn't changed in a very very very long time so the 15% is not necessarily reflective of of um of CPI but increasing it to 1005 in two years if CPI increases by 5% over the two years wouldn't require an entire new review it simply is allowing them to keep Pace with inflation that is correct and inflation is one factor in this the other is the work effort so CPI might increase but it doesn't necessarily trickle down down and correlate directly to the expenses associated with a particular unit so there are I think I just want to state two components to this part of it is the understanding of what happens in the actual clerk's office for the work effort to do it and if nothing substantially changes and it's just rudimentary sort of reprocessing that doesn't necessarily might need to uh warrant an increase that's a good point because a firsttime application is very different from then just doing a renewal and and that's a good point that dual consideration uh when the council discusses that make sure that they they roll that into their discussion because it's really the it's really the reason why the fees why we're doing what we're doing with the fees recognizing that the cost of even doing the roll forward increases 5% over two years too the C the the payroll cost the benefit cost so it doesn't stay the same cost even if it's the same effort and by the way that dou Tails nicely with a recommendation we made to consider going to program based budgeting because then you'll know the full full cost of anything you're doing on a quick basis let's move on to the next issue which is uh the uh we were going to do a PowerPoint the machine doesn't work so here's a hard copy handout of uh discussion points for looking at Surplus and debt uh what I did over the last couple months was to to examine the process of of how the Surplus us grows in this town and if if you can bear with me I'll just verbalize this for whoever is watching at home uh at the beginning of the budget year you take what's in the Surplus account uh you add to that the revenues that you've collected that uh are over your anticipated operating costs and then you take some of that money and put it back in the budget appropriate it back in the budget and then you have your ending Surplus and every year that rotates in and the more Revenue you collect which is which is unencumbered goes into the Surplus and what happens in what's happening in Cape May is uh the next page which is the growth of the Surplus uh 2016's budget the Surplus account was $4 million in 2023 the Surplus account was $14 million this is just a general this is just a general fund each of the utilities maintains its own Surplus but I'm not talking about them right now now if you look at the next chart this is this is kind of interesting because uh that annual appropriation out of surplus into the budget uh typically typically covers what the city's paying for Debt Service so so I looked at those two elements of the Appropriations and the revenue and this is what you found that in 2016 uh the the uh Surplus money was 2.1 million and The Debt Service was 2.5 so it's it's going to Balan out a little bit over time that relationship has clearly changed and we're looking at a scenario in our budget where this year in 2024 uh we are going to appropriate $5.9 million in out of surplus into general fund and our debt service is $4.4 million so that balancing relationship is going is escalating it looks like and is becoming a serious Trend uh now the revenue the Surplus comes from two sources one of them is revenues and uh over over the last five or six years these these four elements have generated uh a a a larger amount of Revenue than was typically covered in previous budgets property tax the occupancy tax of course the meril fees and the parking meter fees and if you look at the next chart which is also kind of interesting that you look at the actual budget of Revenue it's uh it's striking frankly the the the miscellaneous revenue is increased so radically that uh it's almost flowing it's almost flowing money and property taxes increased along with it as well now this chart this next chart is kind of convoluted but it shows all four of the sources of revenue that the city has over the last uh well since 2017 and you can see that delinquent tax pretty much stable um the use of surplus increasing a little bit property tax looking flat frankly it was it's uh pretty good but look at what's happened in the miscellaneous Revenue category it's gone from $6.3 million to 12.0 million lot of money and this is exactly what happened in that in that section of Revenue that was across the board if you look at these things you can see where the sources of this new Revenue came from uh everything with the exception of ABC which is CA statutorily Capp we can't collect any more revenue from ABC than we are currently collecting uh the only other category that that that didn't expand was interest which is understandable given the nature of Investments recently but the two parking hotel hotel rooms EMS is a lot of money and the other licenses and then now that we're changing the residential rental ordinance uh fees that's going that line there is going to go even further I think now the other thing that causes Surplus is um conservative Revenue estimates and basically there's four reasons why they're they're done and they're all good reasons except for the last one uh we we need a ren day fund we need a hedge against unanticipated costs that it's got to be there everybody everybody's domestic budgeting system operates on the same pattern you got to have some money in the pocket in case something happens in case you need a new battery uh and spending patterns change as well and so you really can't plug accurately numbers because you don't really know how much you're going to spend for any one thing uh there's a lot of changes from a budget from the first month to the 12th month and you have that routine cushion building the only one that doesn't make any sense is the last one and and and and we we we really can't accept the concept that well we do that because that's what we do uh and especially in a in in a case of this issue which the trend appears to be something that needs some attention I want to give the city credit under the current Administration they are much better at not falling back on that that's the way it's always been done there are several new things that have come out of MRA recommendations since I've been a member that the city is actively pursuing including for example the third party review of the berkant fees yeah it would be easy to say well we don't need to do that because that's the way it's always been done and we're satisfied so I want to give the city credit for that you're absolutely right and and I I want to I want to Echo that sentiment because it it's refreshing to see what's happening with the way the city does its business with and it's refreshing because Bob you know you know as well as I you of all people should be able to say that yeah what the city's doing now is is late years improved and the fees also that doing that comprehensive review is something that I've heard many times and finally acting on it is a huge positive yeah and Bob's point is back then they didn't have any money they didn't have to worry about a surplus because we didn't have much a wing in the prayer and so this is what that that uh that rainy day fund uh conservative estimate looks like on a chart and you can see it's it's typically the Gap there's a gap there and here's what the Gap looks like every year since 2018 we've basically generated uh more Revenue to those percentages in the 15 to 19% range the only other problem year was 2020 and we all know what happened then we were lucky to have a budget we were lucky to get through it without the kind of damage or other towns had but the trend is that we're we're budgeting uh 15 to 19% under uh what the actual revenue is now if you look at debt the same situation applies there are debt loads in each of the funds and the and the debt service includes principal and interests now the general f Debt Service since 2019 has expanded from $2.8 million to $4.4 million there's more debt uh that's actually a 47% increase in the general fund Debt Service in 2016 it was 14% of the total appropriation 2023 it's 16% so there there there's an inflationary Factor going all throughout this issue and here's our current debt load uh of all three of the utilities 35 million is our current debt load and we're paying $7.1 million interest on that eventually when all of those bonds are becoming uh full realized and here are some spreadsheets that show the interest paid in the uh current fund the water and SE Utility Fund and the beach fund now so the issue so the issue is and let's discuss this one is what is the appropriate Surplus level what what should the Surplus be just in theoretical or academic terms what is it well the the government Finance Officers Association has the best practice inventory and they recommend that uh that a an appropriate Surplus would be 60 days worth of of revenue for your operating expenses is about 16% which covers two months 60 days of your two months yeah yeah and then there's a lot of I mean we're this is the 20,000 foot view here there's there's a lot of variables that go into that kind of thing but generally speaking from their professional recommendation uh you need at least that much money to cover yourself and so here's what you got then this chart's pretty interesting actually the actual appropri the the amount of surplus we are glass as opposed to the the act the annual appropriation we make in Cape May is has escalated from 2016 where it was 21% of the total revenue to um 60% so so theoretically if you use the the or the association's model of of uh of how much did they ask you to put in here 60 um 16% uh you could and that's for two months 16% and uh in 2020 in 2020 the bad year um you had a 36% cushion so you could have gone four months but the 16% doesn't account for a covid type no no episode right no where revenues could show a sharp decline while costs of continuing the city no continues so I I would be comfortable with saying 16% is on the low end I don't know that uh 60% is maybe on the high end um but that also two things have happened one is that the city actually benefited from the postco period in terms of the revenues that came in to the city and it did because of what we are it was a it was a bounce back here everybody wanted to get down here that's well and and the lack of international travel so uh you know there were there were several factors that led to that where um this trend is not likely to continue um we'd love for it to but it's going to start to get constrained as conditions in the world change could go the other way you you just don't know right but and I do just if you have a hurricane or something it's to follow up on to follow up on what um Martin is saying the majority of our revenue is variable right it's based on tourist dollar either through parking Hotel I illustrate it it's no guarantee um and I'll use my health care background it's the same thing in healthcare people have a tendency to make decisions about elective procedures during hard and difficult times this is this we are in the same kind of Market um and so I I don't disagree that maybe 60% is too high but we have been in in that bump period for the last two to three years and and there's there's there may be a trend that shows differently in the next two to three years I agree yeah and I I don't know whether or not again that 60% may appear to be too much but there's always that feeling that sometimes and I guess it's more a conservative approach to more is better yeah it's true and and and uh I'm not saying I'm not saying we're doing we're going to recommend anything except a couple of things on the last page but uh we're a unique Community because and we we we showed that at the last couple meetings we've had some data 40% of our Revenue comes from property taxes and we're in in Stone Harbor that number is 75% so we have we have a very strong source of alternate Revenue that comes over the bridge yeah it comes in and out and it's because of what Kate May is and I'm not suggesting we do anything about this now I'm I'm I'm I'm the interesting is that the only AAA bestp AAA is Avalon the only uh AAA rated municip in C county is Avalon 67% of the revenue comes from property taxes yeah I'm surprised we're not AAA as well well you know you know why because it's it's interesting I think the point to that um would be they know where their money's coming from and it's more guaranteed and so therefore you know it's it makes your budgeting a safer bet you're only going to work within what you know whereas we have 60% of our monies out on the street at any given time and so you have a tendency to maybe be a lot more conservative in your budgeting and what you're keeping in Surplus because of the fact that you can only rely on paying 40% of the bills at times right no no that that was the point I was trying to make that you know that because of the fact that we're not at two-thirds of our Revenue coming in which is should be a pretty well-known number right yeah versus isord I'm still I'm still a little surprised we're not we're not triple A oh yeah I don't disagree with that I mean I mean and and that we shouldn't uh you know find out what it would take to move us to that level because that would help right we all would love to be Tri well and the other thing about revenue and covid too is that the spikes in Revenue were not just because of occupancy tax they were because of property tax too because we had an awful lot of homes that were overpriced and and sold at the overprice and that gen that generated an increase in property tax yield not not not not many people's property taxes went up but that was the the the total City yield for property tax jumped pretty significantly and very rapidly right after covid came into and building on Bob's point of in his administration you didn't have the luxury of spending money we've got some major projects coming up that this kind of surplus allows us to contemp there's a certain gentleman that keeps on bringing up the growth of the surplus of the debt load and U I know that our debt numbers are good today but we've got got the Dil plan and we've got the seaw wall project coming up absolutely absolutely without this kind of surplus that can be devoted to it could start to strain the debt load well let's take a look at that because that that really is where I want this discussion to go and let's jump to the last page which is the list of this is off of Paul's report back in uh June I think um these are all the projects that uh that on the the capital menu and uh a diesell plant's not even on this one well you know I this just for the this is just for capital for 2024 yeah it's not for the bigger long-term projects which is diesel Seawall I mean there's a number of other things that are being discussed that would add to that with significant Grant levels associated with it that we don't really know the cost of the city that's exactly right but other projects um Martin that have not even you know sort of been fully vetted or discussed or even understand but we know that they potentially are out there look the the U going back to the slide slide 22 um is uh another recommendation from that organization which which is that that municipal government should have a formal policy on how they maintain Surplus what it's used for and and the issue here is that Kate May doesn't have one of them um I I would think that would be hard no no it's not that hard no no so when you're going to have an emergency I mean well you you a policy would you must have to put some aside for that a policy would have to identify the amount of money the floor uh to uh to which you would have to go before you would need to use the Surplus uh when what what what circumstances uh necessitate the use of surplus and you know a process answering those questions is is an assurance to the public that there's transparency in your government that that what you have what you what you're doing with your tax money like for example as an example here um we we generated a lot of revenue from residents and visitors uh but by the same token that while that money sits there we're paying Debt Service to buy stuff that we could avoid if we used some of the cash hey I'm for that U so I if you look at if you look at the last the project summary maybe a good idea might be to examine some of these things pick them out of there and instead of bonding for them pay for them uh I agree in in the budget there has to be some point at which that would occur exactly exactly and and and I think the data shows I agree the data shows that there's so much money in the Surplus right now that you could actually do some of that yeah and avoid uh interest payments paying the interest yeah because who knows what the interest payments are going to be so I think what do you what would you consider to be an appropriate floor I mean unscientifically without having well well I would go back I would use the the associations uh with some recognition that we have a much more variable economy than other communities so 25% 30% I mean trying to put a bow on what all this work that you've done I I would think that we could make a recommendation that an appropriate floor for Surplus would be 30% with there being uh you know some type of an articulated transparent plan for any exess I think 30% would be good oh wait a minute let's let's not that too far ahead ourselves I I you don't want to spend the money no no here's what I don't here's what I don't want to do here's what I don't want to do I don't want to do the city's job no that's true and I and I think that uh what we've found here is that the issue of the relationship between Surplus and debt and the way we handle both of those things needs to be examined uh by the city's uh fiscal Specialists because we're not fiscal Specialists all we do is we search around the internet and look for charts and stuff like that and we find data and we put it together and it's it's interesting it's it's a Cape May issue and and it's a unique issue to Cape May I don't think there's a town on the coast it has a bigger Surplus yeah I'm bet there isn't so what what you're talking about here is is suggesting to the city that we we we could come up with a way where our professionals take this data dig it deeper and then do what Martin wants to do which is to say here's our policy we're not going to go below this uh we're going to use the Surplus for the following things and and have a policy that assures the public that we're not just squirreling a money away and and keeping their taxes higher than they could be because every every what is what is what's the penny worth on the tax $375,000 is that what it is right now3 billion base so yeah yeah so I mean so you're you're talking about you're talking about something that that suggests that you look at this issue and and and Forge a policy that assures the public that you you you're doing what you know what you're doing and there's a plan for what you're doing and that's that's kind of what we're saying here well I think the informed taxpayer sees what the city's doing with the Surplus it's it's the person that only looks at that6 Million number in isolation and says wow why why are we maintaining a$6 billion Surplus we're not we're using million yep and well we're making we're actually making money on that too yes yeah policy policy aside but that's what you mean by squirreling away yeah policy aside I think there's I think the hint is in the chart that you prepared Dennis I mean you see the capital needs and the amount of money that's coming up needed for 24 and increasing to 2025 so look we have we have a smart city manager we have I'm I'm sure there's discussions that are going on so they're aware that the Surplus is there they know what the capital needs are there I think it's uh I think there's a lot to be said as far as you know just how all this will play out well well I and I wanted this this issue to follow up what you're saying I wanted this issue to be upfront with with the committee and the city at the beginning of the budget cycle the budget cycle starts right now yeah uh and I I would like the city to consider this issue as it preps its budget are are are there small things that they can use this Surplus for that we don't have the bond for is there a way that we could we could explain and and I know what the explanation is as Mar Martin's already Illustrated some of these issues it's it's it's big ticket items coming down the pike that we need to be ready to spend on I mean you know I won't I won't say that that's you know a definitive answer coming from either uh the city manager or the CFO but what I know right now is what we don't know right we don't know about how much some of this has cost and I think that there's this very conservative um mindset that's saying you know this could be a big ticket item um and not wanting to have the burden of that expense for a Dale plan if needed and necessary and that's the big scary item yes to be to to to be put on the taxpayers back as much as that could be avoided through I bank loans and other things is what is being pursued but if the the city needs to come up with some um substantial money to put into that then you've got this fund that could offset that but those are things again they're that project seaw wall project promot Expansion Project there are you know the beach Patrol uh headquarters is being looked at there is the police station when it ground finally breaks there are so many things that are on the list that um but I you know I agree that having some type of of a format that says what should be those the that threshold of funds um and maybe trying to put some framework around all of these other projects to say we may need to increase that threshold and here's the reasons why but just going through the exercise I would agree yeah it I think it's it's incumbent on the city to to do it the right way and and that's the right way that's the right way and you go if you go through our code book there's no there's no reference anywhere in our codebook except for two uh references in some other context of of a surplus and it it it's just not good business practice well I wouldn't have thought anyone would have anticipated the type of surplus that we're we have the luxury of having to be able to put into a code book so you know um you know just because you know it hasn't been thought of or it hasn't come up through an ordinance or whatever yeah but I get I get that point but I also think that in a in a situation in a fiscal environment where our monies are as you mentioned variable and and U dependent on a lot of factors that we can't control it it would be a good thing to have a policy on oh I I absolutely agree Dennis I'm just saying I'm not surprised it doesn't exist because it's probably not a problem anyone and anticipated us having not a problem but if Bob had done this when he was mayor we would not have to be doing we have any money I need to yeah go ahead you'll see it okay uh so what do you want to do with this issue you want to suggest the council that uh they consider adopting a policy on Surplus I guess the question is who has the capability to do that for the city uh Chief Financial Officer we should we should get him in talk to talk with him then okay I would think also H I'm sorry might also involve Leon you know like some outside Leon C someone outside as well I think all right why don't we suggest this then that that we have a a cqu with Leon and U and and our CFO at the next meeting okay yeah all right do that that's good I think with you all right that would give us a little oomph in yeah yeah sure uh oh look at there was no comment about Bond day anticipation notes do we know what kind of debt we have with the bond anticipation notes uh you mean the bonds that we haven't actually taken yet no we borrow short-term money oh yeah right and that money is to be used before we Bond anything it's the bond anticipation notes right and it's they we borrow it at a significantly lower rate and it's shortterm you can borrow it up to nine years um do we do we have any idea how much that money amounts to no we don't but that's a good issue for our I feel that's a good question you got $15 million or whatever in Surplus and we're doing short-term financing with with paying interest uh that I recognize that and I well the the interest rate that we're now earning on on sweet monies is an excess of 3% and I won't I don't it's a little more than that and we're borrowing money at something just over 2% and I don't know what that exact rate is obviously there's a benefit here with the amount of money that we have in sweep account accounts now I don't know I don't know in what form our Surplus money is in to enable us to get all that sweep money to earn I mean all that Surplus money to earn sweep account interest yeah that's a good question i'msure it is it's probably more well then the if if we got $15 million in in Surplus and we can earn three or three and a half% interest should be earning 5% well that that's that's the point I was going to get to Bob it's some point if we can have if we can show what our Surplus is on some kind of a continual basis we can do a little bit of extra ordinary uh investment secure at a higher rate than three or three and a half percent I I would hope well Leon costell would be yeah I think that's a good issue for that meeting we're going to have absolutely and does does maybe you know Russ what what what is our bond rate I have no idea yeah do you know Dennis no because it it varies no no well it varies every time we go out with a bond because I understand what they do is is they bid that rate but what were rated for I think is oh Bond rating is was it double A it's double A yeah or Bond rating is dou a bond rating is double A I'm sorry is that what you meant that's what I meant yeah our rating is yeah we he misunderstood the question I misunderstood your question sorry yeah our rating is dou a and that varies I guess depending on when a bond goes out what it's what is bonding yeah the amount of money the term all those ingredients come together and the various they bid it so and Russ's question is a good one why aren't we Triple A it sounds like we should be that's why I brought it up yeah well it's because AV debt that's why another question for Leon well well but our I think we're I don't know when I looked at the I just looked at you you have to ask to be rated I was going to say just be simply we haven't asked I don't know that we've asked when the last time is we' asked probably haven't so they're mean our situation is lot different you know from this year than it was two years ago I don't know when we were lasted but I would just suggest maybe you can add that to the list that we we should ask when was the last time we requested a rating the question you're asking is what are what do we go out with new bonds and receive as a rate right well yeah I mean we can't we have the old bonds at less than 2% right but you're ask you're you're asking how much are new bonds issued at what what what percentage partially that and also if you're AAA versus ablea you're going to get a better rate and we don't know what the term is you know but so so Dennis maybe we can add that to the list yeah absolutely but how much did you say we're paying for shortterm interest on a bond rate yeah short term talking about the sweep money well the sweep money I understand is it's what it's over 3% the interest that we are earning well I mean can buy a CD for three months and get maybe 5% 5.2 or something 5.2 why shouldn't we that's that's why I said we ought to be able without any real difficulty find out what is our residual balance in in in in in Surplus money I mean it's got to be $10 million that's exactly right and that's and that should be at 5% well said we talked about this before Dennis I thought they did incre I thought they did change things around to increase that rate mhm they did so I don't know what it is right now but I know they we went through this whole process before there was a certain Bank in town that used to do all yeah we we uh we suggested to go shopping and they did you put it out on bid just like you do anything else they did they did I don't know what it is but they did yeah they went shopping and then they uh they they they came up with a good rate the other issue they were getting the other issue and maybe you know the answer to it is the interest that is earned on the sweep accounts where is that interest yeah where's it going where is it deposited probably into the general fund where else it's in each of the funds so for example it be I know that in 2023 the interest earned by The Beach utility was over $100,000 higher than it was the year before that's right that was where we switched our investment philosophy so the interest was credited to the beach Utility Fund well that's the question where where well they maintain a surplus too maybe I don't know the answer to how this what sweep what accounts are put into the sweep monies I've ask that yeah I don't know the answer either I I remember list of questions I remember keev Kevin saying it's all but I don't know you know I don't know ex if it's all 16 million or not that's a question that Kevin would be able to phone's on the floor I get it I I dropped it out the other thing is list of your question we're going to have a meeting in October are we not that's what no we're not having a meeting in October we're having a meeting in November so the next meeting is November and there will be two issues on the agenda one of them is this issue uh and a deeper dig into Surplus bonding and uh fund manipulation and you're gonna have Leon here right and Leon will'll invite Leon and we'll invite Kevin and U and the second TPA attend you can attend you can come anytime you don't need an invitation uh and the other issue is going to be the data analysis yeah I'll so I'll follow up on that and um encourage the city to not it doesn't need to be super final down to the last1 right okay that's that's good yeah all right anybody else have anything Sarah we're going to talk about the the meting isv 14 is that the second Thursday the Thursday and it's at 3:30 or at 4 it's at 3:30 okay and then it'll be every other month yes yes okay thanks for coming Jules see you anything else for the good to the order make a motion anybody want to adjourn the meeting make a motion to adjourn I figured Russ would my motion to okay we're done hit the stop recording on that computer did we say 4:00 is that we said no 330 to do it at 330 to set the rec