patience uh it's good to see everybody this morning uh Council anything before we start Gil can you hear us okay yes I can okay anything before we start okay Carlos I guess you're it all right good morning Mr Mayor members of city council um thank you for being here this morning for our third budget Workshop of the fy2 uh budget prep season um last month if you recall the first Workshop we talked about the general fund and we talked about the specifics the sort of meat and potatoes of the fund uh we have not changed anything regarding the items in the budget from that first Workshop so today what I'd like to do is really provide you more of a 30,000 foot view of the budget process and also a strategic analysis of where we we're going over the next two or three years uh we've been aided to do that also in this time period because now the city of Tampa and the county have also released their budget and if you read their sort their budget documents or transmittal letters you'll see a lot of the same challenges headwinds that they're encountering we're also facing so we going to have that conversation at any point if you have any questions of me just just let me know and I can stop and clarify any items um before we get going I just want to remind the public of the remaining budget schedule so today we are doing again the general fund strategic overview on Thursday we will have another Workshop uh dedicated to the special revenue and Enterprise funds um last month we weren't able to provide the detail that we wanted we didn't have it in time yet but we will have that for this Thursday on Tuesday the council will be setting the millage rate and then on September 3rd we'll have the first reading and first public hearing of the budget document and on the 17th the second reading and the public hearing second public hearing hopefully the budget adoption that same evening now I'm thinking about the budget I think it's always important to you can't look at any given year in vacuum we have to look at it as part of a long-term plan kind of like a strategic plan right so when you if you've done strategic planning you know you start out with this called this swad an analysis which is strengths weaknesses opportunities and threats and I think that's really helpful for this exercise here today so if you look at our strengths um I think our number one strength are our people our city staff uh we've got a lot of great staff and that's thanks in large measure to the investment that you've allowed us to make in wages and competitive benefits for our staff uh that goes hand inand with an emphasis on performance we really we have a lot of people who are performing at much higher abilities than we've ever had in this organization uh we have a lot better accountability also and that's continuing to improve over time another strength we have here is we have a very limited debt burden I'm actually very happy to say that this year's budget includes the last payment on the golf course loan which will leave us basically with One debt instrument which is the CRA loan again which is at a very low interest rate so we're in great great stead in terms of our debt capacity um and the council also knows that we've done a lot to uh create a robust I'm calling it a capital reserve Fund in our unassigned fund balance there's a lot programmed to this year's budget from that from that fund balance and in the future again it's an ability for us rather than necessarily having to fund Pro defer projects or fund projects through debt we have to pay interest in this case we're allow we're able to pay as we go in terms of weaknesses uh we're a small City geographically we're about 8 square miles uh and of that 8 square miles most of it is built out so we don't have the ability to grow our tax space the way other communities and other parts of the country might might be able to so that's definitely a challenge and of the areas that we have developed we really don't have that diverse commercial industrial base that we would want that we in an ideal situation so a lot of our commercial areas 56 or in fer for example are neighborhood retail right neighborhood retail you don't have any no one's going to drive from South Tampa to go to our stores here it's not usually how it works we don't have that Regional draw um in an industry we don't have the big industrial park we do have some we have an industrial park in the area we anic several years ago in the southeast part of our community but again not to the magnitude or quality that you'd expect if you really want to bolster that that tax growth uh in terms of opportunities it's uh always been my stance since I started here at the city that USF is probably the biggest asset we can have as a sort of region uh the fact that they're right next door to us I always like to say they're really we're really their Hometown not Tampa uh so that's incredible for energy and customers for our businesses Etc but also importantly in terms of real estate development USF is really playing a bigger role in that area they've got a a plan in place that they've talked about now for the last year or so to develop the claw property off of 46 and Fletcher uh the county is also looking to develop the mosy property the property around mosy I should say those two developments if they come to fruition will be win-wins for the city of Temple Terrace because they're going to be right there at our doorstep investors will be looking at this area uh with a new found scrutiny so they want opportunities to invest and so we're going to be the next logical Choice also if you think about all the people moving to this mixed juuse development you know there might be renting they might want to buy a home and obviously Temple Terrace has a great community of single family homes so there's a lot of great upside to that area um another another area that kind of ties into a way to address our weaknesses is annexation uh the in case the community is not aware our utility service area which is where we provide water and sewer Services is far bigger than our corporate limits as a city our utility service area goes almost to 301 on the east side of our community so we have a a plan in place a loose plan at least of potentially annexing most of that area over time uh and so we we need need to focus on that to address some of our challenges uh I will tell you though our staff is they're spread pretty thin right now so having them gear up and do annexation as well will be a little bit of a challenge in of itself uh but I believe what we're going to end up doing is probably creating a staff task force to really focus on this over the next year and try to map out how we're going to get this accomplished and again the last two opportunities are reflective of our strengths again that limited debt burden and that capital reserve allows us to be nimble to respond to opportunities that might come about now let's talk about threats uh not to be bad neighbors I have the city of Tampa a number one threat here uh City of Tampa is great being close to City of Tampa as well because obviously they've done great job redeveloping Channel Side Water Street that whole area Midtown there's a lot of cool cool things that Tampa has done which makes this region a great place to live but organizationally Tampa being an entity I believe they have about 5,000 employees when they make a decision the butterfly effect is like a tsunami and it wipes you know it affects all of us and being that we are a small city right next to them it really affects us disproportionately uh when may Caster made changes to um how much Tampa pays its Public Safety officers a couple of years ago and then spread it out to the rest of of its General employees those that impact uh had significant consequence for the city of Temple Terrace and in fact regionally I was just speaking with a colleague last week and they were saying how how Orange County right now is in negotiations with one of their unions and the City of Tampa is is the Forefront of their negotiations it's come up over and over again so as far as Orlando basically that's how far this this Title Wave of change has gone because of what Tampa has done so we know what they've done in the past any decision they make in the future again could could impact us and we can't control that uh we just need to be able to be in a good position to react to it and so unfortunately that is that is a continued threat for us another threat is uh every legislative session up in Tallahassee once session starts I think we all start chewing down our our fingernails wondering what's going to happen what's going to come out of that session in terms of either preemptive action or an unfunded mandate um over last several years we've had to respond to a number of these things and I imagine that will continue to happen the CIT the community investment tax uh I want to thank the Hillsboro County commission for putting it on the ballot this year hopefully it will be renewed if the CIT is not renewed and we've talked about this extensively here that will mean a a dramatic impact on our budget right now we are generating about $2 million a year in Revenue um and we spend almost $2 million a year in capital investment because of the CIT if the CIT were renewed it would be about $53 million over the next 15 years of that renewal period so again huge amount of money um if we had to make up $2 million and let's say we to give you an equivalent on the millage rate uh $2 million would be about 2/3 of a full mill on our City's tax rate so it's a pretty significant amount and then the final threat is one that is regional in nature which is property values are are cooling off and we're going to talk a little bit more about that in a moment so let's uh look at our adval tax revenue uh you'll see over time you can this this basically illustrates sort of how the market has been doing very very well uh in 2019 we were generating about $10.7 million Ador tax revenue and in 2025 for the budget we are programming about $18.9 million so it's about a $8 million or so uh increase in adval Revenue if I were if I were to extrapolate out that line and just project what it would be going forward it probably be much flatter um I don't think it's going to necessarily come down but it's definitely going to flatten out now it could come down if we had a significant recession hopefully that won't happen uh but it's going to flatten out so we're going to see growth numbers which I would imagine in the future we we might get a blip a year here or a year there if there's a big building that comes online but I think if if you look out three or five years we're probably going to have growths to maybe you know maybe 3% 4% something like that uh this past year when we presented you the June budget we were basing it on a 6.1% growth number that the property appraiser had given us uh I'll be honest that 6.1% growth number already initially was a little disappointing we had hoped it would be slightly higher um unfortunately what happened was between this that June workshop and then the June number from the property appraiser and the July number the property appraiser gave us there was a drop there was about a $32 million loss of value and our number came in at 50 uh 5.3% uh which our staff had never experienced that with a number going down so we uh we've been we've had several calls with people in the Property Appraiser's office to understand what happened the best explanation that we've gotten so far is that there was a delay in getting information from the value adjustment board and that information typically would be included in the June estimate so it would have all been calculated in there they didn't get it for the June estimate they only got it in time for the July estimate uh unfortunately didn't tell us that this was happening so we were quite blindsided by it uh but we've made changes in our budget um to adapt to this we haven't cut any of the programmed elements in the budget and we'll talk about that shortly mentioned a second ago about how property values are cooling off so and there's definitely different Trends in this in this calculation so uh two weeks ago Finance director Ingram and myself we had the opportunity to be on a conference call with the appraisers director of its tax role um he and we asked him what's the forecast what are you seeing in the marketplace uh he said the following he said commercial is trending downward in fact I think the terminology was it's in a downward spiral uh that was probably already starting to happen right before the pandemic people online uh purchasing has really taken impact imagine they in pandemic everybody's coped up what were they doing they were ordering everything online uh people got used to doing that uh you come out of the pandemic there's also staff shortages which only exacerbate issues for for commercials so that has been going downward uh also office product is included in this and office product is still not recovered particularly in our part of the county so we're on the Eastern sort of quote unquote EAS Northeastern end compared to Tampa um so data centers things like that which would sort of be our bread and butter for like the Telecom Park uh facility that is something now that companies has just farmed out to to their employees to do from home um so you're seeing that shift areas such as like the downtown in Tampa where they have done creative things and they've marketed and and tied to amenities those have had some success but again it's not the same amount of office product so there's still a lot out there that's that's vacant in terms of residential there's a mixed approach to residential right now single family homes are still appreciating uh but it's if you follow the trend it used to be like this it was overheated the market so everything was going up in terms of prices if you tried to buy a home you knew this um that is now cooling off so that's probably flattening out that curve a multif family however is declining uh and apparently there's been a pretty dramatic decline in the value of multifam or apartment complexes uh the best explanation given for that is that apparently during the the the Heyday of low interest rates a lot of multif family apartment complex owners uh refinanced their their complexes and a lot of those payments now coming due with some balloon payments now and trying to get refinancing now where the rates are much higher you know four or five percentage points higher than they were before is a disincentive so a lot of investors are skittish of investing in multif family right now they just the numbers don't work for them so that's creating a decline value for those those properties uh and as the you all know we have several of these so if you look at Temple Terrace highway or CRA out fer we have and also Morris Bridge we have a number of these apartment complexes so those are not doing as well as they historically have done the one bright spot in terms of property values is industrial uh industrial is appreciating significantly uh so if you were to rent industrial space uh like manufacturing space or Distribution Center warehouse space if you were to rent it anywhere probably in the US East Coast three or four years ago you were probably paying between four and $6 doar a square foot if you try to rent that same space here in the Tampa Bay Region today you're probably paying between $1 13 and $16 a square foot if you try to rent that same space in Miami you're paying $30 a square foot to have you understand what that means $30 a square foot would have been a high-end Mall R rent for a retailer several years ago and now now it's industrial and this is there's a combination of factors affecting this my estimation there's been onshoring so the the pandemic hit there's a move to onshore Industry because we saw the disruption and supply chain so companies decided Well rather than be in in China wherever they were they decided to come back and you're so you're bringing New Uses back or not you uses historically they had been uses but then the the geography had changed you're bringing them back now there's limited land area particularly in Florida and so the supply and demand so the costs now are going are going up significantly so from a value perspective for a community that's great if you have a lot of industrial in our case we have a very limited Supply so we don't necessarily see we probably won't see a lot of return on this uh over the next couple of years unless we pick up more of these industrial areas now another uh big generator of revenue for the cities for the general fund is uh interest earnings uh this is a very interesting chart because again like it's it's just fascinating to me I'm not an economist but I I like seeing how changes at the global level affect us at the local level and you can clearly see that here so um in in 2021 you see from this chart we were generating about $86,000 in interest in 2025 budget we have $1.8 million in interest uh projected how does that happen well if you recall what was happening between 21 and 22 the inflation was starting to take off uh the federal reserve put the sort of the breaks on that by by increasing the the FED funds rate the FED funds rate today day is about 5.25 to 52% been following this and figuring out okay when is that rate going to going to stop or going to come down uh they are projecting and these are people trying to read the same tea leaves we're all trying to read and so you know just disperate information here but best I could tell is that if there's going to be another reduction in the rate it would probably happen maybe as early as September maybe another one in December maybe a quarter point each maybe maybe not again this is still speculation out there uh eventually the FED wants to get to about one and a quar to 2% by the end of calendar year 2026 which would be our fiscal year 27 so that will have an impact um another thing that's influencing this this peak here is the great work that Mr Ingram and the finance department has done so they took the direction from city council a couple years ago to really look at how we invest our money uh making sure our money is invested obviously in safe instruments because we're regulated we can't just put it in you know stocks and bonds and things like that but um they've shopped around our money to find best rates of return for us so they've moved things around that's helped our budget tremendously as well uh but despite all that if the interest rates start to drop what you're going to see on this chart this chart will dramatically it'll be like a cliff or like a roller coaster we'll use the Bush Gardens analogy so it's going to go up it's going to start to come down again um will it get down to as low as 85,000 I don't know hopefully what Jim's doing is is going to help def deflect some of that uh reduction but sely definitely excuse me going to come down now at the same time so we talked about the revenue side of the house and you saw everything was going up and then it starting to come down or taper off Personnel Services is going up so Personnel Services the image here this is everything has to do with our people so this is Wages the benefits uh fringes payroll tax Etc um and this is also kind of the legacy of what we've done as a concerted effort here as part of the city council and City Administration so in 2019 we were investing about 20.7 million in Personnel Services in our general fund in 2025 in this current budget we're proposing to you that number is increased to 29.7 so a $9 million increase in our people uh this number unlike the other numbers is probably not going to come down uh it will it would come down if the council decided that we needed to cut Services uh we we I'm not proposing that or or saying that's it's going to happen but if that's where you wanted to go if we had to control that that would be one scenario where that would have to be would have to occur but I just want the community to know look we've made a major concerted investment in our in our people uh to make sure that we stay competitive as an organization um which has been important uh particularly in this this region so if you take the Personnel investment and you take all the other operating investment that we do so buying fuel paying for paper clips everything we we do as part of the general fund you can see how it breaks out here on this on this particular pie chart I want to make sure the council understands this pie chart is exclusive of the use of assigned or unassigned fund balance because you you might see in your backup the numbers will be they'll be different because when we calculate the use of those unsigned or assigned fund balances it goes into the general fund here I I extrapolate that out because that's mostly Capital this is basically our day-to-day our bread and butter so if you look at this you see that over 9% nearly 60% of our general fund budget is an investment in public safety uh and that's been pretty consistent I mean we we spend most of our dollars on police and fire uh and then you see after that basically you have Administration Leisure Services uh Public Works Etc so but the bulk again is is in in public safety Carlos what's non-administration what what's an example non Administration would be like Community Development uh so administrations are your internal support department so executive Finance HR it uh non-administration be like Community Development where they have external they face the the external part of the community um and code yes thank you so that's included in that as well so we we we've talked about what we do what we invest in uh and we managed to do that by not raising uh through not raising the the millage rate so um as far back at least until 2019 our millage rate was 6 .55 uh 6555 and in 23 again if recall the the chart about the in the uh Ador tax rate increase that was the year that Amazon came on the books there was a significant increase Council felt comfortable reducing the millage rate we have stayed at 6.45 for the last two fiscal years we are proposing to stay at that millage rate so the FY 25 budget does not contemplate any millage rate increase um and to see how that places Us in the marketplace so uh you see here we have all the sort of Municipal jurisdictions including the County's Municipal Services uh jurisdiction so Tampa is at 62076 uh last year recall Tampa proposed the mayor proposed a 1 mil increase uh that was shot down by the city council they had my estimation the mayor had to do that because of all the increases she had given in salary the year prior um that was not accepted uh by the by the council this year under the budget that's been submitted my understanding is that there is not a millage increase proposed um so I would imagine this would stay at the same number unless through the budget process they decided to change that but the if you read the mayor's comments when she submitted the budget she indicated it's going to be a struggle there there's going to be because she's seeing the same headwinds we are their growth number if you recall we we talked about the property appraisers changing their estimate well that was $32 million for us for them I imagine it was you significantly more uh and I know for a fact and talking with some of you that that have talked to them to the sort of the staff over in Tampa that they they were rocked by what happened um and so they've had to make some adaptation to that so they're going to they're going to have a struggle on their hands City Plant City their number here the 5.7 I will tell you it's the fiscal 24 number I looked for their fiscal 25 budget it's not online yet so I wasn't able to update that I so I'm right now I'm using the assumption that they're going to stay steady at 5.7 but they could increase it potentially the county did increase their millage in the unincorporated parts of of their service area so what the county did is kind of interesting they did what they're calling a millage swap so if you get your tax bill you'll see that if you live in a City Temple Terrace you pay the county you pay a portion of your taxes to the county uh let's call it round we'll round up we'll say it's about five Mills and that's for General County Services uh if you're the unincorporated part of the county you pay that five as well but you also pay for municipal services the equivalent of city services to that to those residents what the county has done is it's taken basically a tenth of a mill from the uh the general over across the county number and applied it and increase the unincorporated service number by that same amount so they're calling it a wash um but it's just a way for them to account for the fact that they're providing a lot of services and if you talk to Folks at the county mean the bulk of the County's popul bulk of the population of Hillsboro County as a geographic entity is unincorporated uh so so they they are strained they're basically the largest city in in the county by far uh if you talk to them they'll tell you you know if Brandon could become a city they would love it because it's you know that it's basically set up to be its own City it's just not the case and so that's where they spend a lot of their County in dollars Carlos can you go back to the previous slide for a second yep would it be too much trouble to get this same information but go back to 2015 10 years we can do that and then maybe email the slide to the council yep thank you okay and the other this one I just had a comment on that I'm going from memory here but every year I look pretty hard at the trim notice that comes out and although we may have the highest Municipal millage rate if you look at Tampa's full tax burden if you own a 300,000 home your tax rate is higher every year than than Temple Terrace because of the things that you pay that we don't pay here and so forth correct so there's uh and we see we'll see it more so probably even with the with the Enterprise funds U because there's different charges what what some municipalities will have they might have a fire fee they might have a Library District fee things like that so when you when you run that calculation through you're you're likely to catch of the things so the overall Financial if you are a resident in the city City of Tampa and your residence or you own property City of Tampa residential property own a residential property here uh this can be misleading because you have to consume water and sewer and and those things and so when you when you sugar all that out you're not it's not if if you're savings uh saving I should say because you live in Tampa the difference is is nominal p in some respects it actually might be a little higher by by living there you want to go up to the mic yeah while he's going up to the mic uh I know um city of Tampa and Hills a County pay a special Library fee it was 0.55 mil so you add that on the city of Tampa right now and that's they're lot they're higher than us yeah they they're always higher okay then stay down right 93 this year the reason I think that's important for us to kind of dwell on that is because it's been rumored over the years that oh my gosh Temple Terrace has the highest millage rate I've even heard it said we the highest mill rate in the State of Florida we're not even we're not even in the same universe as the highest mill rate in the State of Florida that that is not true it has never been true um and yet that's still a pervasive myth that I hear repeated periodically in the in in the uh in the community that's not true um so anyway there are cities that have way higher millage rates than we've ever even contemplated so right right and I think think it's important to also note that if you recall when we talked about the the the property valuations again we don't have a lot of industrial we don't have a lot of that high earning commercial as well whereas a Tampa does uh or the county might for for example or another community in Florida might as well so the mill rate is also a ratio to that so if we're a community that our tax base is not as strong not because of Any efforts on our part and things that we're not doing well it's just the nature of it we're small so the mill has to factor in in for that whereas you know if you're a community that is is flush with lots of you know Acres upon Acres of industrial space like a a plant city for example so let's talk about them for real quick so they're at right now potentially 5 5.7 who knows what they're going to be when they submit their budget but if you look at Plant City you see a lot of growth there right a lot of open land a lot of distribution centers warehouses I imagine some manufacturing facilities Etc so that is low service requirement for the city high return on tax base and so so that allows them to do stuff like this to keep that millage rate at at at that level so again it we we try to be cognizant of that we try to always make sure that the millage rate is as most where we can keep it at the most low low level possible but the reality is we still are expected to provide services and to provide services we need to adjust for that and so it's reflective of our tax base also well and I'm sorry to belabor this but this is important to the community this military discussion and so the other thing I would point to in the community is um we are less than 02 Mills higher than Tampa which is pretty negligible unless you own a $10 million home and there's a marked difference no no offense to my friends in Tampa but there's a marked difference between the levels of services in Temple Terrace and the community expectation here than there is in Tampa or unincorporated or even Plant City for that matter and point what just one example is we don't have potholes right we got a pothole in the street which happens in Florida happens everywhere we fix it and we get too many potholes and we repave the street so the only potholes in Temple Terrace are on the county roads that run through temple tffs they're not on our streets we don't have Pooles well if you drive through Tampa I'll just leave that alone there but um you know I so the community expectation here of our police our fire our response times our Parks our the family Recreation Center the number of parks and green space neighborhood parks we have more green space per capita I mean we're in the top tier of the State of Florida in that regard so I I don't this slide doesn't really tell the full picture here and so um anyway I'll leave that alone but that that I think it's a you get a good value for your taxes in Temple tariffs I really think that right in fact that's what we've all when we talk to our staff our leadership team what differentiates the city and the reason you can have a size is is that we call it sort of the white glove service I mean you get you get services and and responses in in almost all instances that you you're not going to I mean I would never expect to call the city a Tampa with a complaint and have somebody you know have the city manager or the director of Public Works call me personally you know after hours and that's things that we do here and and the elected officials you all do it too and again I don't know if the elected officials in Tampa would do it but I imagine it would be hard for me to believe that they would um some of them do U okay some of them do so I'll give credit credit then where it's due um but that's that's what we have to differentiate our differentiate ourselves in because of our size so we have to be nimble we have to be high quality mayor yeah some um just a a comment for not necessarily doing this right this it but as we move forward in the budget process I think it would be helpful if we had more a comparison of not just the straight the pure millage rate but more the tax burden that might be placed on a resident in each City so that we're comparing more Apples to Apples because our millage rate is comprehensive and that we don't have any other small taxes we don't have any Community Development taxing districts that you know a homeowner might be added um so so our millage rate is all inclusive basically whereas some of the other jurisdictions have other fees or taxes and I don't mean Enterprise funds I just mean uh just general budget usage where they're paying so really the cost of I think that would give us a better comparison for the purpose of this particular discussion it basically what's the what's the full tax burden for that you mean beyond what the trim notice would tell you no I mean I think the trim notice is is pretty comprehensive unless there we're talking about fees that are outside of the trim notice but I definitely don't mean the Enterprise funds sewer water that sort of thing if if we we can I'm sorry now I had a question on trim notice so trim notice wouldn't show uh street light districts they it it would be hard to to capture all the cdcs in here because like town and country's got one and somebody El I mean it' be hard but Tampa may have do they have a storm water assessment Citywide do we know C I do not think so well they may have stuff some I know somebody has stff like that so when you add all that up and I know it's hard cuz some have it some don't General yeah so so we we'll we'll do some digging we'll I think what would be helpful maybe it's a com combination of things I think we can definitely show the uh and we just picked a couple of properties and putting this together so if if if we find a property elsewhere that might be in a different District that number that trim notice might actually be a slightly different so we'll we'll do a little bit more of a sample on on a city of Tampa side um what we can also do I think would be one step forward and you say keep the Enterprise funds out but I also would like to show a chart maybe that shows that sort of overall financial burden on a on a property owner like a single family home in Tampa versus templ ter or something like that so we'll think about that and maybe we'll include that in the U we can get it to you beforehand but we might even include it in the presentations in September okay okay um so as we as we've talked about here we had that change in the property appraisers evaluation so we did adjust to that um I mentioned we did not cut out any of the services that we had proposed in the fy2 24 fy2 budget um but obviously we had a gap so to make to address this Gap we did few things uh and I want to give all the credit to Mr Ingram and his team because when I say we it's him uh him and his team they're the ones that really came up with these ideas so um sanitation fund let's talk about that last year if you'll remember the sanitation fund was in tough shape uh it was uh significantly bleeding money and we had to find ways to address it one of the ways to address it to make sure that we had a rate increase that was uh reasonable and not the original 10% which is when we started these workshops we were looking at that a year ago is uh we we stopped making an overhead payment to the general fund from the Enterprise fund from sanitation so for the public who may not be who don't deal with Municipal fund accounting it is very very common in Municipal fund accounting for when you have an Enterprise fund which is a business basically business Enterprise um way of accounting for your dollars uh that fund is being provided services from other departments in the general fund for example executive administ uh Finance HR all those entities interact with that with that sanitation fund so because of that Enterprise funds will pay a portion back to the general fund again very common practice last year we stopped doing that we put it on pause in an effort to stem the financial or improve the financial condition of the fund and that was before we hired Jason we hired Mr Warren felds uh in the uh late summer and Mr warfels came on and one of the things that he started to do was just look at all of this and try to unravel it all uh as I've reported here before he's made incredible inroads and picking up new accounts uh tightening up our our just the finances as a whole so because of that the sanitation fund is doing much better you'll see this Thursday than it than it was projected to to be doing at this point um so in light of the fact we had this drop we we went back and we looked at this and we said you know what can we afford to pull these dollars this this overhead charge from the sanitation fund uh Jim felt confident we could so we have restarted that contribution in this in this budget now to again address this Gap that we had another thing we did is in the first budget Workshop we talked about we always have assumptions as to how our revenues will do and we assumed that a lot of our revenues were going to be a 2% increase which was a very very conservative number uh what Jim was able to do in the month since was we had more data now we could see more Trend analysis and he felt very comfortable upping our interest number despite the fact the interest rates are going to drop at some point uh he still felt conservatively that we could increase what we had projected in interest uh so he did that as well that helped again bridge the gap and the final thing was we had to reduce the contribution to the unassigned fund balance if you recall it was budgeted about 46 or $50,000 or so I believe was going into unassigned fund balance in the original draft well that's now going to be zero that's budgeted doesn't mean that if we have savings because we have vacancies things like that at the end of the year that we may not have an actual practical contribution to unassigned fun balance that could happen um but we're not budgeting for it any questions on that Gil any questions no I have no questions okay everything sounds consistent so I want to close with just uh some takeaways um so just again to leave folks with they understanding look adorm what are we seeing so adval again the valuation is slowing the Fed rate is going to decrease uh and hopefully we will not lose the CIT another area that that we've touched upon slightly in this presentation but we want to focus a little bit here is also contractual demands um we last year we reopened the Police contract in light of again the disparities caused by the city of Tampa uh I think it was the right thing to do but it came at a cost so there's a significant cost increase to the city's budget uh this year we're negotiating with the fire Union uh we have projected included of uh what we think is is is the appropriate offer in the budget for fy2 um but those demands those are increasing our Personnel Services and increasing not only that from a from a Global Perspective it's doing that but on a per employee perspective uh the contractual demands are creating what we we're looking hopefully won't create this but we're very cognizant of making sure that we don't have inequities in our organization incred you know we want we don't want to have a disparity between staff I I value all the employees so all 328 employees of the city of of Temple Terrace are important so I want to make sure that we're not other people aren't falling behind because their positions may not be in these police or the fire unions for example so we're very concerned about that uh as we've mentioned to the council before you've allowed us to do we we make strategic changes where we if we find that we have issues for example with recruitment or retention or the marketplace is is just changed if we have to make strategic changes we will continue to do that um and at some point next year for example in the future I think it's still going to be important to you know make sure that our employees are still compensated moving forward all our employees potentially to avoid those discrepancies um so just want to leave you with that and take any questions Council questions yes yes council member Fernandez okay I I have a couple questions so with regard to the investment income that you've predicted in the last year and the year before I think we had a higher fund balance which we will be pulling down in order to fund some of our capital projects how much will that impact our investment income a very good question which uh I have considered uh I I wouldn't expect it to pull down like immediately because the timing of the payments from the unassigned fun B it's going to take time to get projects going and certain things spent with that being said uh one of the moves we recently made was to to move a good chunk of money to uh a much higher interest rate uh through the Florida safe it's one of the local government investment pools which generally makes good interest now we we do know that there will probably be some drop I think what we have budgeted though uh is still conservative based on what our return is now it's um even though we're projecting a yearend estimate of 1.8 million looking at the latest numbers I I think it's going to be higher this year but so I think what we budgeted next year has all all of these factors in consideration I think it's still a good safe number uh obviously we will have to keep monitoring all of that and we still uh one last point we are also right now looking at some term rates that we can lock in uh before interest rates go down that will um be higher than uh our money market rate with the PNC which is where we hold our main main funds okay all right thank you but it is is a good question and it is definitely a consideration because as time goes by that is going to affect the the return um so this uh question I think is for the city manager and that is since industrial is becoming a more a higher demand area to uh for property is there a way that we can change any designation for existing property I'm thinking of Telecom Park that there are some areas that industrial warehousing might be suited being some of it's farther away from residential areas um is would that require rezoning to allow something like that it probably would so Telecom as a it was a development of regional impact so there's a master plan for for Telecom so I I don't believe sort of the there's probably some elements of industrial that maybe some light industrial that might be okay in in that part because we do have some of that we see bake here for example right um but heavy industry would probably require some comprehensive plan um amendments uh and changing to changes to that master plan as well think we want to also be careful because we're commercial property is is it's very cyclical right so you go things are are low now but then five years from now there'll be a different Trend and then one segment which was low now will start to take off again so I don't think you want to sacrifice I think you'd want to be careful if you wanted because once you put let's say if you put some heavy heavier industry in that in that in that park it could change the makeup of that park or the character of that of that Park um that is a you know that is one of our prized sort of areas in in this community I think right now it's just it's doing okay it's not doing it like it it did in the past just because of sort of the global economy but I think if you wanted to say now we're going to hey let's develop and just have like these little shops where guys can you know fix transmissions and things like that that's not going to be the kind of return you're going to want anyway no I was thinking more like light industrial loow impact warehousing that kind of thing not not at all heavy industri and and that might might be okay so I'd have to see talk with our planning staff and figure out if something like that would work we've had different interest in Telecom Park there's a one or two Parcels in Telecom which right now are still are still vacant um we've had interest for at one point this is this is also indic indicative how these things are cyclical so a year or 18 months ago we had a party that came in and they wanted to to do multif Family Apartments and that was like the thing that's what they were going to do multif Family Apartments and that's definitely not in the cards for that Park cuz that would create a whole lot of issues to put it right in the middle of all the business parts of the park um and now you look we're 18 months later and that the bottoms fall out fallen out of that Marketplace and now people are looking to talk about industrial and so you just you can't I think if we're going to make changes we need to really think conservatively and not just respond to the trend um which I I'm just all I'm I'm just asking what kind of options we might have in into the future because we don't have a lot of industrial space and just to give us a more a well-rounded tax base but I'm not proposing that we go aad jump in and start making big changes but I'm thinking more of maybe creating some designation that it could there's multiple uses that property could have but um I'm not suggesting we we jump and do that then my my last question is about the housing our housing stock our housing market and yes the market value for homes is declining not necessarily large numbers but but it is it is declining a little bit but we have so many houses that have been held for so long that I mean I could use myself as an example we bought our house in 1996 even though the value is declining from where it was last year if I sell my house today it's still a huge increase over what I paid in 96 is there a way to look at what has been held long term that I guess if is that factored into our valuation and uh estimate that we get from the property of meaning that some of these houses yes the overall value may may be declining but somebody who bought a house 25 years ago is going to pay that they're going to sell it and that's going to come onto our property roles at a higher value is that factored into this estimate that we get from the property appraiser um so I don't know if the property I don't I don't think the property appraiser is doing predictions in terms of going forward as to who might sell or I don't think that's calculated in I think they're actually looking at I would imagine what they're doing is looking at actual sales data our community is not very large so there's not a whole lot of sales so they might have to pull comps from other comparable areas sort of in in the region um and they're making you know some predictive I guess there's some projection of that in terms of of a growth number for single family again based on actual sales the other part of this to keep in mind is that with the homestead exemption here in in the State of Florida it does basically cushion the growth the value growth of anybody if you have Homestead protection on on your property I think it's 3% is the is the max today they tried to change it to two um so that that already kind of so the existing homes the people who like yourself who've owned a house since 96 it's like you're not you're not really adding tremendously to this growth now right I have very I have my growth is 3% versus if I were going to sell it today the growth would be much that's right yeah um so that so that that really hasn't factored in a whole lot am I seeing anecdotally are we seeing more houses for sale I think there probably are more houses for sale today than there might have been a a year ago um maybe that's because more houses staying on the market a little bit longer because interest rates are are are higher now so there there's a little bit of that uh but the Temple Terrace Market is still it's still kind of it still somewhat unique in the sense that you know I get these flyers you probably all have received these flyers from Realtors and you're and they here's this house sold in one day this house sold in two days and so it seems like things are still moving pretty quickly um but there has to be some there has to be some moderation in that behavior just because of the interest rates I can't imagine that hasn't had some impact right okay I just wanted to know how how the basis of the calculation and if that was included somewhere in the calculation so that's it for me council members yes I got three um we used to have and we still may have agreements annexation agreements with property especially in the 301 Industrial Area do we still have some outstanding that are contiguous that we're working on in fact uh we mayor and I were just talking about one um so there there we are looking at that um it it it hasn't been a focus yet I'll be honest I mean there's been other things that we've been working on so we haven't had to focus on this but now in fact we have been looking there's one property for example the marathon property on Temple Terrace highway is one that was was recently brought to our attention that does have an agreement in place to um Annex once it's contiguous which in fact it is contiguous today so we are going to be as part of this annexation task force that I mentioned that we're going to have to convene probably going to be looking at some of these uh agreements RIT large in in in the city and find out you know what right now is if there are triggers that have already been activated that we need to follow up on uh that would make it easier I would think if there's already those agreements in place versus us having to proactively go out and try to find areas to to Annex okay thank you the second one uh the property at the end of rollerson Ranch Road our Water Reclamation property that we sold has there been any indication of they started anything on their design or any of that so they in in fact uh their deadline for submitting information to us was this past week and they've reached out to Greg um so they this is this is actually a great example of the market the global Marketplace impacting a local development so they originally were going to do a trade school trade school Market really wasn't there was saturated so then they decided they wanted to do Apartments multif Family Apartments we brought that to the council then they realized the multif Family Market is is dead right now so now they've changed to Condominiums so they have this a similar plan in terms of units um but they want to build condos so Greg is working with them to get because they have to provide us with some sketches what this will look like to bring to council we will likely have to have an amendment back to you because now they they're changing that we also have to uh figure out a a way to monitor for the affordable housing component that was included originally was 10% of the rental units which there's a way to monitor that but once you sell a condo that's going to be a a different animal that I'm not sure how to address but we're going to reach out to the counties housing folks and see if there's a way that they've they've done it um so that's that's still in the works okay thank you my last question are you happy with what the you just presented us I have a question okay well I don't know you got to tell me if you're happy with it go hold on let let him answer um James and I'll call you next I want to know if you're happy so if if I'm happy I I think we have a solid budget uh I was happy about the budget in June when I presented it to you um I still think it's a good budget I think we're we're we're making some positive changes it's still conservative in nature um am I concerned about the future absolutely but right now this budget I think is is a solid budget presented to the council I was dismayed by what the property appraiser that whole trans how that transpired um but thanks to the great team that we've got working in finance I think we found a way to to address it that that doesn't affect the services that we wanted to bring to this community in fy2 and you'll know my answer when it's time for comments but right now we're in questions so okay Gil you have the floor yeah I'm sor sorry talking I do have one quick question if you can hear me okay the 5% differential the collectibility of our a taxes the U statutory budim any IDE did you get that the 5% the 5% difference between this the statutary amount of collection and our budget yeah did you it is yes we put the 9 microphone cuz he can't hear you sorry yes the ADV valorum in this budget is 95% as uh required statutory requirements it's not the full 100% and about how much is that worth to the city you know how much that is the the actual amount um I I'm sorry I do not have that off the top of my head if I had a calculator uh handy I might be able to figure it out in a few minutes we can we can we can get that to council potentially that that's that's true that's a good point yeah yeah um I don't know if you can hear but Gil saying that that is potential additional Revenue that we would receive because we're that that money is potentially available right keep right I believe we've already exceeded what we budgeted this year um for that very reason because we we have to budget 95% and we usually get over 95% exactly so I think that we have to you know we took the funding the budget but I think um something we keep in the back will end up the good point so Carlos I have have a question um two two couple questions actually thank you Gil thank you Gil so you said before about the pay raises in this for the general employees what were you thinking 4% and then two for correct so it's uh what we have programmed is a 4% sort of a cost of living adjustment which would kick in October 1 and then uh 2% which is like we did last year for once they get their anniversary and they do a satisfactory performance evaluation okay another question and I you don't have to do this now or predict this now but some clarification on the country club loan because you mentioned it I don't want members of the public to be confused by that so we may be reaching the end of the bank loan but what has happened is the city has been paying the payments on the bank loan and the country club theoretically has been paying the city at times over the period of this loan the country club has paid the city in full and ESS and essentially the city is going to pass through for that money to the bank but other times this country club has not been able to pay that and we've been paying it anyway and so the PNC loan may be done this year but the debt from the country club to the city goes on for enough decades at the rate they're paying it goes on for another I think I don't know what the real the outstanding balance at the bank is but I think they they owe us like $2.6 million don't they a portion of that is still due to the bank the rest of it's so repaying us exactly so that our final is it $259 is it our final payment the final payment yes so our final payment is $ 259,000 in change but you're correct they ow but they because they've been basically reamortizing their schedule Council actions over the past and not only Council action but Al action on their part sort of unilateral action they're going to owe us for quite some time well and that's what I want the public to understand I don't want people who are country club members to go around oh my gosh that you know thank goodness this year we you know our obligation ends no their obligation goes on for the rate they're paying they're going to be longer than anybody who's alive now right they're going to still be paying so I don't want anybody to get excited from their perspective they still ow a lot of money and the question in this is and and I don't even really need to know the answer to this because you guys are smarter than me I'm sure you've already looked at this we're on the hook for that we're co-signers on the loan so we have to pay the bank even if they default unfortunately what I don't know the interest earn scenario versus the interest paying out you know I don't know what rate and I don't even know if there's a prepayment penalty in this loan or is there is it better for us to just pay this off and be done with it or is it better to just keep making the quarterly payments I you know now that we're towards the end I'm sure you've looked at that but we just have the one payment right I know some of that do well we may if there's only one payment I guess it it's a it's an annual pay or twice a year payment sorry um that we make we or I may be confusing it with another we do have one this year it's it's paid at the end of the year so we do have one this year uh and I believe I'd have to look back at the schedule but I believe the last payment then would come at the end of fiscal year 25 and that's the one that we have that we're budgeting to use unassigned fund bounce so that would be the last payment but I will double check that and Thursday make sure I have the correct answer on that the the prepayment penalty is great that's why this was negotiated this way okay the city was on the hook for it and could not repay it uh I mean pay it off in advance it was not worth it okay and uh actually one last thing this isn't a question this is a comment we've had several discussions about industrial and annexation and things and so city manager and I have talked about this a lot over really since you've been here I guess we've been talking about it and his talk about and we talked about this during our strategic planning also we've had several talks about you know what are the what are the possibilities and this task force or committee that Carlos is talking about would would kind of come back what what we as a council together with management need to really kind of look at is forming a real plan a real vision of where we could go some of that would include taking in property that's ripe for industrial or light industrial manufacturing and that would be like along the 301 Corridor that 301 Corridor between the 301 Industrial Park which is almost already ours over half I guess is ours all the way up to Fowler is ripe and if you look at the plans that dot has for the improvements on 301 in the future that is a major Corridor between I4 and Zephyr Hills and up in the Pasco so that is very desirable for industrial Light industrial kind of development because you can get out and you can get to the port you can get to the rail Rays you can get to the networks to get your goods out um there are some challenges that come with that though and both but we need to get together and talk about some of that and one of the challenges that we've talked about with the 301 industrial park is those roads in there are not ours they continue to be County Roads and if we continue to Annex that we're at the Tipping Point where the count is going to say okay well if you want to take it you got to take the roads and those roads are currently in terrible shape and so that would be a significant investment in redoing those roads um because it's not just the roads it's everything under the road too and it's heavy trucks out there so that's not a cheap Prospect so um but we we really need to in the Carlos and I were talking about this just yesterday I think we talked about it we've done kind of a whacka mole approach to annexation over the years you know okay we'll take that property or we'll take that property or we'll take that one or whatever we're going to have to do a little better with that if we're going to get out to the area and that that may include taking some areas that at first blush we may say you know I don't know if we want that but the cherry pick is very difficult the County's not going to let you just cherry pick um so and then we have to figure out what to do about our code enforcement because some of those areas are reluctant to come in because of code some of those areas the biggest barrier or the code that don't live by our codes they got their boat in the driveway and they don't want to move it or you know something like that so anyhow we need there's more work for us to do on that but and that's it from me yes yes vice mayor thank you for this budget it was really clear easy to follow and um thorough so I really appreciated that it all made sense great thank you you're welcome comment yes council member chamb okay uh two uh one we talked about a SL maybe having a slide that shows comparative costs when you include storm water and Library uh millage and stuff like that that really helps this year I don't know if if it's that important I've found over the years that when you're not raising anything uh there's less talk about that uh but for our future we need that that's a good thing if you could include that and to answer your question yes I'm happy great that was it good Gil any comments I didn't hear him he was comfortable was anything else yes I have the answer can you mute again please there you go thank you so we do have a pay the fiscal year 24 payment uh we've already made an interest payment that's the one in the middle of the year uh we do have a payment due at the end of the year that's s it's budgeted in this fiscal Year's budget it's um a total of 246,000 at the end of next year um I'll check into it I think there's a payment penalty but I'll double check this but the it's not going to change the interest rate is fixed so it won't change we know exactly how much where where we need to pay for the last payment which comes in fiscal year 25 and that's the one we have used the unassigned fund balance we transfer it from general fund Into The Debt Service fund to make that payment um using those unassigned fund balance dollars and then we'll be done with it well sort of we'll be done not collected yeah right anything else that's all I have thank you Council anything else directors anything else that's it very good Gil any final comments or good okay very good thank you to our team thank you to all of you uh appreciate the hard work and uh we'll stand adjourned y [Music] [Music] [Music] [Music] [Music]