[CALL TO ORDER]
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WELL, GOOD EVENING AND WELCOME TO OUR WORK SESSION OF NOVEMBER 2ND, A DAY, COMMEMORATED BY THE BIRTH OF COUNCIL MEMBER.
MCCLELLAN, GLAD TO CELEBRATE WITH YOU HERE TONIGHT.
SO COUNSEL, YEAH, COULDN'T THINK OF A BETTER PLACE.
[1. COVID-19 QUARTERLY FINANCIAL UPDATE]
FINANCIAL UPDATE AND I SEE WE HAVE ALL OF COUNCIL HERE.SO AT THIS POINT, LET ME OPEN THIS MEETING AND TURN THIS OVER TO CITY MANAGER.
UM, THIS IS OUR SECOND QUARTERLY UPDATE IN REGARDS TO OUR, OUR FINANCIALS.
UM, AS EVERYONE WILL RECALL, UH, AT THE TIME THE BUDGETS WERE BEING PUT TOGETHER, UM, IT WAS THE TIME OF PANDEMIC AND UNSURETY IN TERMS OF WHAT OUR REVENUES WOULD LOOK LIKE.
AND, UH, COUNCIL CERTAINLY DID THE PRUDENT THING AND, UH, REDUCED THE BUDGET BY A MINI MILLIONS AT THIS POINT, ALMOST 30 MILLION BETWEEN LAST YEAR AND THIS YEAR.
AND SO WITH THAT, WE'VE CONTINUED TO MONITOR VERY CLOSELY.
NOT THAT WE DON'T MONITOR ALWAYS, BUT, UH, VERY CLOSELY BECAUSE OF THE PANDEMIC AND SOME OF THOSE SPECIFIC REVENUES AROUND, UM, WHAT THE PANDEMIC HAS HURT US MOST ON.
SO WITHOUT FURTHER ADO, I'M GOING TO INTRODUCE MATT DUNBAR OR BUDGET MANAGER, AND LET HIM BEGIN THIS PRESENTATION FOR YOU.
GOOD EVENING, MAYOR AND COUNCIL.
UH, IT'S GREAT TO BE HERE WITH YOU THIS EVENING.
I'M OFTEN TOLD THAT, YOU KNOW, SOMETIMES WHEN YOU HAVE THESE OPPORTUNITIES, YOU FEEL A LITTLE NERVOUS, BUT I FEEL LIKE A DAIRY COW AND TALL GRASS.
I'M UTTERLY TICKLED TO BE HERE WITH YOU TONIGHT.
CAN WE HAVE IT MIRROR? CAN WE MAKE A MOTION THAT EVERY SINGLE PRESENTATION HAS COME WITH A BAD JOKE FIRST? I WOULD AGREE.
SO, UM, BUT IT'S A GREAT OPPORTUNITY TO BE HERE, TO TALK ABOUT THE FIRST QUARTER OF OUR CURRENT FISCAL YEAR WITH YOU AND KIND OF HOW THE FINANCIALS HAVE GONE.
UM, CAUSE IT IS A GOOD STORY AND UH, WE WANT TO BE ABLE TO SHARE IT WITH YOU.
SO TONIGHT WE'RE GOING TO LOOK, WE'RE GOING TO FIRST TALK ABOUT OUR ECONOMIC FORECAST FROM A NATIONAL AND A STATE PERSPECTIVE, AND THEN GIVE YOU KIND OF A LOCAL UPDATE.
WE'LL TALK ABOUT OUR REVENUES, OUR EXPENDITURES, AND THEN WE DO HAVE A POLICY QUESTION FOR YOU SOME DIRECTION THAT'S NEEDED.
AND THEN WE'LL TALK ABOUT OUR NEXT STEPS AS WE GET TO OUR NEXT QUARTERLY UPDATE COMING UP FIRST, I DO WANT TO POINT OUT, WE DID UPDATE THIS SLIDE.
THIS IS THE WORLD'S MOST ACCURATE PIE CHART.
UH, LAST TIME YOU SAW THIS, IT WAS LEMON, BUT OF COURSE IT'S NOVEMBER.
UH, YOU KNOW, YOU HAVE A PORTION THERE THAT'S ALREADY, I ALREADY ATE ABOUT TO EAT THE NEXT SECTION.
AND THEN THE REMAINING SECTION IS WE'LL EAT.
UH, I GUESS THE ONLY UNKNOWN ABOUT THIS IS HOW MUCH WHIPPED CREAM, HOW MANY CANS WILL TAKE TO GET THROUGH THIS PIE.
SO IF IT'S AT MY HOUSE, IT'LL BE AT LEAST THREE BECAUSE MY KIDS EAT MORE WHIPPED CREAM THAN THEY DO PIE.
SO, UM, ON A NATIONAL LEVEL THOUGH, WE DO WANT TO GO THROUGH THIS UPDATE.
SO, UH, WE HAVE A FEW NEW INDICATORS THAT WE WANTED TO SHARE WITH YOU.
UM, WHEN WE ARE CREATING THIS UPDATE, THE GDP NUMBERS WEREN'T AVAILABLE YET, THEY CAME OUT FRIDAY LAST WEEK.
SO WE DO HAVE AN UPDATE THERE.
UH, THE ADVANCED ESTIMATE ON GDP HAD AN ESTIMATED GROWTH OF 33.1%.
SO IF YOU'VE BEEN FOLLOWING, UH, GDP GROWTH, THAT WAS A SIGNIFICANT INCREASE OVER THE PRIOR QUARTER.
THE PRIOR QUARTER OF COURSE SAW A SIGNIFICANT DECREASE, UH, 33.4% DECREASE.
AND NOW WE'VE SEEN ALMOST A COMPLETE REVERSAL OF THAT IN GDP.
UM, BUT WE DIDN'T WANT TO PULL SOME OTHER INDICATORS THAT WERE AVAILABLE TO US AT THE TIME.
UH, SO CONSTRUCTION SPENDING IS ONE, UH, CONSTRUCTION SPENDING IS UP 1.4% FOR THE QUARTER, UM, ABOVE THE REVISED JULY, 2020 NUMBERS.
NOW OF COURSE, CONSTRUCTION SPENDING, IT REPRESENTS ABOUT 20% OF TOTAL GDP.
SO IT'S REALLY ONE OF THOSE LEADING INDICATORS BECAUSE AS CONSTRUCTION GOES, TYPICALLY THE MARKETS OR ECONOMY WILL GO WHEN YOU START TO SEE CONSTRUCTION FALLING, YOU'LL START TO SEE THE ECONOMY FALLING AS WELL.
AND CONSTRUCTION IS USUALLY A LEADING INDICATOR AS FAR AS COMING OUT OF ANY KIND OF RECESSION.
SO TO SEE CONTINUED CONSTRUCTION GROWTH IS A POSITIVE FROM A NATIONAL LEVEL.
THE OTHER INDICATOR THAT WE HAVE AS BUSINESS FORMATION STATISTICS, THE BUSINESS FORMATION FROM QUARTER TO CALENDAR YEAR TO QUARTER THREE, UH, WAS AN INCREASE OF 77.4%.
SO TYPICALLY WE HAVE A RIGHT AROUND AS A, FOR THE NATION ABOUT 850 870,000 BUSINESSES THAT ARE ADDED, UH, ON A QUARTERLY BASIS.
UM, THIS LAST ONE WAS 1.5 MILLION.
SO, UM, UH, A SIGNIFICANT INCREASE IN THAT 77%.
SO WE DO SEE THAT THERE IS FROM A, A BUSINESS PERSPECTIVE, UH, BUSINESSES DO SEE THAT THERE IS A VIABLE ECONOMY TO ENTER INTO THE MARKET AS A BUSINESS AT THIS TIME.
UM, IN FACT, SOME OF THE GROWTH IS IN PARTICULAR DUE TO BUSINESSES, WAITING IN RESERVE TO SEE HOW THE ECONOMY WOULD GO.
NOW THAT THEY'VE GOT ADDITIONAL INFORMATION AND ADDITIONAL NUMBERS, THEY'VE SEEN THAT, UM,
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THOSE ASKS FOR NEW BUSINESS FORMATIONS INCREASE.UH, THE OTHER ONE THAT WE HAVE THERE IS ADVANCED MONTHLY SALES FOR RETAIL AND FOOD SALES.
UM, THESE TWO INDUSTRIES, RETAIL HAS BEEN GOING VERY WELL.
UH, FOOD SERVICE HAS BEEN KIND OF THE OPPOSITE.
SO THEY'RE LOOKING AT THIS AS AN INDICATOR AS TO HOW IN GENERAL, THOSE TWO KIND OF CORRELATE AGAIN, WE'RE SEEING A POSITIVE NUMBER 1.9% UP FROM THE PRIOR MONTH.
SO MONTH OVER MONTH, SINCE, SINCE MARCH WE'VE SEEN INCREASES, MARCH WAS THE FIRST DECREASE IN MANY YEARS IN THE RETAIL SALE OF FOOD SERVICE INDUSTRIES.
SO WE CONTINUE TO SEE THOSE NUMBERS INCREASING AND THEN FOR MANUFACTURING AND TRADE INVENTORIES INVENTORIES ARE WHAT WE WANT TO TRY TO KEEP A LOW BUT SLOW.
SO THAT NUMBER NEEDS TO BE FAIRLY LOW, BUT YOU WANT IT TO SEE IT IN A POSITIVE NUMBER.
AND THAT MEANS THAT THE INVENTORIES AREN'T STAGNATING, UH, GOODS ARE BEING SOLD AND DISTRIBUTED VIA EITHER MANUFACTURING, UM, OR WHOLESALE DISTRIBUTION.
SO THAT'S A GOOD NUMBER TO SEE A 0.3% GROWTH IS KIND OF RIGHT IN THAT GOOD ZONE OF WHERE WE WANT TO SEE THAT GROWTH HAPPEN AGAIN.
UH, THE GDP NUMBERS DID COME OUT.
SO WE DO SEE A, UH, A STRONG INDICATION FROM GDP AS TO THE GROWTH OF THE NATIONAL ECONOMY OVER THE LAST QUARTER AS WELL.
THESE TWO CHARTS YOU REMEMBER FROM LAST TIME WE DIDN'T UPDATE, WE S WE SAW THESE AS WELL.
WE WERE BEGINNING TO SEE ON THE TOP THERE, THE RETAIL SALES, WE'RE BEGINNING TO SEE THAT V ACTION COME BACK.
UH, OVER THE LAST THREE MONTHS, WE'VE CONTINUED TO SEE GROWTH ON THE RETAIL SECTOR.
THE RETAIL SECTOR HAS BEEN DOING EXTREMELY WELL, AS FAR AS REBOUNDING, WHEN ECONOMISTS TALK ABOUT SOME OF THESE, UM, UH, ABOUT REBOUNDING.
TYPICALLY THEY TALK ABOUT U SHAPE OR V-SHAPE, OR NOW THERE'S A K SHAPE.
UH, RETAIL SALES IS SEEING A CLEAR V-SHAPE AND THEIR GROWTH.
SO THERE'S A STEEP DROP-OFF DUE TO THE CORONAVIRUS, UH, THAT HAPPENED IN ABOUT MARCH, APRIL TIMEFRAME, AND THEN A STEEP REBOUNDING OF RETAIL SALES.
IN FACT, RETAIL SALES ARE STRONGER NOW THAN THEY WERE PRIOR TO, UH, THE EPIDEMIC, BUT WITH THAT, THERE ARE CERTAIN INDUSTRIES AS WELL, THAT AREN'T FAIRING AS WELL.
SO, UM, WHEN WE TALK ABOUT A K RECOVERY, THAT INCLUDES CERTAIN INDUSTRIES GOING UP AND CERTAIN INDUSTRIES GOING DOWN, WHICH CREATES THAT K LOOK.
UM, SO WHEN YOU LOOK AT INDUSTRIES LIKE AMUSEMENTS AND HOTEL, MOTEL, AND RESTAURANT AND BAR, THOSE INDUSTRIES ARE STILL STRUGGLING FROM THE PANDEMIC, BUT RETAIL SALES ARE RETAIL.
UM, AT THE BOTTOM HERE, WE TALK ABOUT THE MARKET PMI.
THAT'S THE PURCHASING MANAGER INDEX.
THAT INDEX REALLY IS A SURVEY OF SUPPLY MANAGERS, AND IT GIVES US A GOOD INDICATION ABOUT KIND OF WHERE WE'RE AT AS FAR AS AN ECONOMY, ARE WE EXPANDING OR CONTRACTING ANYTHING ABOVE 50 IS CONSIDERED EXPANSION AND ANYTHING BELOW 50 IS CONSIDERED CONTRACTION? UH, SO WE'RE CURRENTLY SHOWING IN AN EXPANSION STAGE, UH, WHERE THOSE PURCHASING MANAGERS ARE, ARE BUYING RAW MATERIALS, AND THOSE RAW MATERIALS WILL BE TURNED INTO GOODS.
UM, AND WE SEE THAT AS THE GDP NUMBERS ARE RELEASED, THAT THERE'S A LOT OF ECONOMIC GROWTH HAPPENING AND THAT KIND OF DIRECTLY REFLECTED HERE IN THIS MARKET, PMI.
THE LAST SLIDE ABOUT THE NATIONAL ECONOMY ALSO KIND OF BLENDS SOME STATE AND LOCAL INFORMATION AS WELL.
SO YOU KIND OF HAVE IT ALL ON ONE SLIDE AND YOU CAN DO COMPARISON.
UM, THESE ARE THE UNEMPLOYMENT STATISTICS.
SO NATIONALLY, UH, WE SAW A STEEP INCREASE FROM 4.4% IN MARCH TO 14.7%.
UH, VERY UNFORTUNATE, NEVER HAVE WE SEEN KIND OF THAT MUCH GROWTH IN THAT INDICATOR, UH, IN THE UNITED STATES.
SO WE, WE GREW SUBSTANTIALLY, BUT THEN YOU CAN SEE OVER TIME, WE'VE BEEN ABLE TO REDUCE THAT NUMBER.
UM, IN FACT, AS OF SEPTEMBER OF 2020, THAT THE US UNEMPLOYMENT RATE WAS DOWN TO 7.9%, WHICH IS A GOOD INDICATOR OF THINGS ARE IMPROVING.
UM, ARIZONA HAS ALSO SEEN, UH, THAT SAME KIND OF, UH, A TREND OF A SIGNIFICANT INCREASE IN APRIL, BUT OVER THE LAST QUARTER SPECIFICALLY, WE'VE SEEN THAT NUMBER OF 10.0 10.7 5.9, A SLIGHT INCREASE IN THE LAST MONTH TO 6.7, BUT A SIGNIFICANT DECREASE AS WELL FROM THE STATE PERSPECTIVE.
AND THE MAJORITY OF THOSE NUMBERS ARE LOWER THAN THE NATIONAL AVERAGE.
AND THEN WHEN YOU COMPARE CHANDLER, EVEN TO ARIZONA, YOU'LL SEE THAT OUR LOCAL ECONOMY, A MICRO ECONOMY IS DOING EVEN BETTER OR FAIRING EVEN BETTER FROM AN UNEMPLOYMENT STANDPOINT.
SO WE SEE THOSE NUMBERS THAT ENDED LAST QUARTER AT 8.7, UH, THEY'RE NOW 5.5 AND CHAMPION OR 5.5% UNEMPLOYMENT RATE.
I JUST WANT TO MAKE A COMMENT THAT, YOU KNOW, THIS IS WHERE I WANT TO COMMEND STAFF AND ALSO COUNCIL FOR EVERYTHING WE'VE DONE TO SORT OF KEEP THE WHEELS MOVING AS IT RELATES TO OUR ECONOMY.
WHEN YOU SEE NUMBERS LIKE THAT, THAT IS NOT JUST SOMETHING THAT YOU JUST FLIPPED BY ON A SLIDE THAT IS A REALLY, REALLY BIG DEAL.
AND IT'S AN INDICATION OF A HEALTHY ECONOMY IN A HEALTHY BUSINESS COMMUNITY, MAKING SURE WE PUT OUR COMMUNITY FIRST
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AS IT RELATES TO OUR RECOVERY.AND I JUST WANT TO JUST, I JUST WANT TO TALK ABOUT THAT.
SO NEXT, WE'RE GOING TO GET INTO OUR STATE ECONOMY AND FOCUS A LITTLE BIT ON THAT.
ONE OF THE KEY SLIDES THAT WE SHOWED LAST TIME, WE WANT TO KIND OF FOCUS ON AGAIN FOR THIS ONE.
WE'VE ALREADY SEEN SOME OF THE UNEMPLOYMENT NUMBERS AND HOW THEY'VE IMPROVED THROUGHOUT THE STATE.
UM, BUT THE UNIVERSITY OF ARIZONA PROVIDES THIS ON A MONTHLY OR A QUARTERLY BASIS, AND THIS IS THEIR THIRD QUARTER UPDATE OF THEIR BASE FORECAST.
AND THIS HAS SEVERAL DIFFERENT NUMBERS THAT ARE GOOD INDICATORS AS TO WHERE THOSE ECONOMISTS FEEL THAT THE LOCAL ECONOMY IN ARIZONA IS GOING TO GO.
UM, ALL OF THESE NUMBERS SINCE LAST TIME HAVE GONE POSITIVE, INCREASED IN A POSITIVE WAY.
SO YOU'LL NOTICE SO PERSONAL INCOME, PERSONAL INCOME WAS ESTIMATED TO DECREASE IN THE CALENDAR YEAR 2020 THAT YOU SEE THERE.
THIS IS THE SECOND TAB OVER, UM, IT'S NOW ANTICIPATED TO INCREASE 3.9% RETAIL SALES.
WE'RE ALSO IN A DEEP DECLINE OR ESTIMATED LAST QUARTER TO BE DECLINING AND ARE NOW PROJECTED TO BE INCREASING.
AND WE'RE SEEING THAT IN THE ACTUAL NUMBERS AND THEN THE OUT NUMBERS IN CALENDAR YEAR 21, 22 AND 23, ALL OF THOSE NUMBERS ARE IMPROVING AS WELL.
UH, SO GREAT NEWS FROM A, AN ECONOMIST STANDPOINT, UM, THOSE PROFESSIONALS THAT DEAL WITH THIS ON A DAILY BASIS, UM, THEIR, THEIR PROJECTIONS ARE GETTING ROSIER AS WELL AS THINGS LOOK TO BE IMPROVING.
UM, OUR POPULATION ESTIMATES HAVE INCREASED AS WELL.
UH, THERE, THE NUMBER OF INDIVIDUALS MOVING INTO THE STATE OF ARIZONA CONTINUES TO INCREASE.
UM, AND WE, OUR HOPE IS THAT MANY OF THEM CHOOSE CHANDLER AS THEIR PLACE OF RESIDENCE.
WE HAVE MANY OPPORTUNITIES FOR THEM HERE.
UM, AND THEN RESIDENTIAL PERMITS, UH, RESIDENTIAL BUILDING UNITS, AGAIN, CONSTRUCTION IS MAKES UP A LARGE PART OF GDP AND IS ALSO AN IMPORTANT INDICATOR THROUGHOUT LOCAL ECONOMIES.
AND IN ARIZONA, WE SEE RESIDENTIAL PERMITS INCREASING AGAIN, UH, CALENDAR YEAR 2020, ABOUT A 6.3% ESTIMATED INCREASE.
WE DO SEE SOME DECLINES THEY HAVE IN THEIR FORECAST IN THE OUT YEARS, BUT THOSE NUMBERS HAVE BEEN REDUCED FROM THE INITIAL DECLINES THEY ANTICIPATED PRIOR TO THEIR THIRD QUARTER BASE UPDATE.
NOW, BEFORE WE GET INTO CHANDLER, I DO WANT TO SHARE A FEW OF THE, JUST THE HEADLINES FROM A NATIONAL AND A STATE PERSPECTIVE THAT HAVE KIND OF, UM, BEEN OUT THERE JUST TO GET A FLAVOR OF WHERE THINGS ARE ON A NATIONAL, UM, PERSPECTIVE.
LET ME FIND MY HEADLINES HERE.
UH, SO, SO THESE ARE SOME FROM THE WALL STREET JOURNAL, UH, US HOUSEHOLD SPENDING ROSE IN SEPTEMBER 1.4% ECONOMY SURGES, BUT HASN'T RECOUPED ALL PANDEMIC LOSSES, GDP ROSE, AND QUARTER THREE.
US JOB WAS CLAIMS FELT A SEVEN MONTH, LOW OF 751,000 LAST WEEK.
DURABLE GOODS ORDERS RIOTS FOR FIFTH CONSECUTIVE MONTH.
US HOME PRICE GROWTH ACCELERATED IN AUGUST, UH, AND FROM AN A LOCAL PERSPECTIVE, ARIZONA, THE VALLEY HOUSING MARKET STRONG, DESPITE PANDEMIC BIOTECH INDUSTRY BRINGING HUNDREDS OF JOBS TO PHOENIX CHANDLER FACTORY GETS A HUNDRED MILLION DOLLAR UPGRADES FOR 5G PRODUCTION.
SKYHARBOUR PASSENGER COUNTS CONTINUE TO CLIMB TO SEPTEMBER ARIZONA NEEDS THOUSANDS OF CONSTRUCTION WORKERS IN OCTOBER.
SO WE SEE THAT THINGS CONTINUE TO PROGRESS.
UH, ONE OF THE BEST HEADLINES THAT I SAW WAS FROM USA TODAY, AND IT SAID THAT THE MCRIB WAS COMING BACK TO LOCATIONS NATIONWIDE DECEMBER 2ND.
UM, GREAT HEADLINES OUT THERE.
WHEN WE LOOK AT CHANDLER SPECIFICALLY, UM, OUR OWN SPECIFIC UPDATE, OUR BUILDING PERMIT TRENDS CONTINUE TO TREND WELL, OUR NUMBERS REMAIN STRONG.
IN FACT, IF YOU LOOK AT THE TOP, THAT'S THE NUMBER OF PERMITS THAT WE'VE ISSUED.
SO THE NUMBER OF PERMITS, UH, FOR JULY, AUGUST, SEPTEMBER COMPARED TO THE PRIOR YEARS, JULY, AUGUST, SEPTEMBER, UH, WE HAVE ISSUED MORE PERMITS THAN LAST YEAR.
WE'VE ISSUED MORE PERMITS THAN THE YEAR BEFORE.
IN FACT, WHEN YOU LOOK AT THE TOTAL OF, FOR LAST QUARTER, WE ISSUED 1,016 PERMITS LAST QUARTER, AND IN THIS QUARTER, IT'S 1,070.
SO WE'RE EVEN OUTPACING A VERY STRONG QUARTER AT THE TAIL END OF LAST FISCAL YEAR.
UM, AS YOU LOOK AT VALUE OF PERMITS, THE VALUE OF PERMITS IS A LITTLE BIT MORE ARBITRARY BECAUSE DEPENDING ON WHAT PERMIT IS POLLED, UM, A LARGE, UM, SEMICONDUCTOR MANUFACTURER MAY PULL A PERMIT.
THAT'S GOING TO BE A LOT MORE THAN, YOU KNOW, MANY HUNDREDS OF SINGLE FAMILY RESIDENCES.
SO DEPENDING ON THE ACTUAL VALUE OF THOSE PERMITS, THAT CAN FLUCTUATE QUITE SIGNIFICANTLY, BUT YOU'LL, YOU WILL NOTICE THAT OUR TOTAL REVENUES COMING IN CONTINUE TO BE STRONG, UH, ABOUT EQUATING TO WHAT WE HAD IN THE FIRST QUARTER OF LAST YEAR.
SO OUR BUILDING PERMIT TRENDS CONTINUE STRONG.
UH, CONSTRUCTION IS ONE OF THOSE LEADING INDICATORS INDICATORS, AND WE'RE SEEING GOOD CONSTRUCTION GROWTH HERE IN CHANDLER.
THE NEXT ONE WE WANTED TO ADDRESS IS, UH, A BUSINESS OPENING AND CLOSING ANALYSIS.
UM, NOW THESE ARE PRELIMINARY LOOK, UH, THIS IS PRIOR TO GOING
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THROUGH OUR RENEWAL PROCESS, WHICH JUST KICKS OFF THIS MONTH.SO WE'RE IN THE PROCESS OF RENEWING ALL THE BUSINESS REGISTRATIONS THROUGHOUT THE CITY, AND WE'LL GET A VERY GOOD INDICATION OF KIND OF WHAT THE NET IMPACT WILL BE.
UM, BUT WE DID GATHER SOME PRELIMINARY NUMBERS JUST TO TAKE A LOOK.
SO FROM MARCH TO SEPTEMBER, WE'VE HAD 83 BUSINESSES CLOSED, UM, OF THOSE BUSINESSES.
SOME OF THEM HAVE CLOSED DUE TO FINANCIAL FAILURES OR DUE TO COVID.
UH, SOME OF THEM HAVE CLOSED BECAUSE THEY SOLD TO ANOTHER OWNER OF THEIR, THEIR EXISTING BUSINESS CHANGED OWNERSHIP.
SO THERE'S A MIX IN THAT NUMBER OF 83 OF THOSE THAT ARE TRULY CLOSED.
AND THOSE THAT ARE JUST OPENING UP WITH UNDER NEW OWNERSHIP, THE NUMBER OF REGISTERED FROM MARCH TO SEPTEMBER 329 BUSINESSES HAVE REGISTERED.
AND THAT'S AGAIN, GOING TO BE A BLEND OF NET NEW BRAND NEW BUSINESSES THAT CAME TO CHANDLER AND ALSO BUSINESSES THAT WEREN'T REGISTERED PREVIOUSLY, BUT ARE NOW REGISTERED SOME OF THEM, UM, AS THEY TOOK ADVANTAGE OF SOME OF THE PROTECTIVE EQUIPMENT THAT THE CITY HAS OFFERED, UH, REGISTRATION IS ONE OF THOSE REQUIREMENTS.
AND SO THEY HAVE TAKEN THAT OPPORTUNITY TO BE REGISTERED.
SO SOME OF THOSE THAT NUMBER REFLECTS THAT, BUT NET NEW REGISTERED BUSINESSES IN THE CITY OVER THIS TIME PERIOD FROM MARCH TO SEPTEMBER 246 NET NEW BUSINESSES.
UH, BUT WE ALSO CONTINUE TO SEE EXPANSION OF OUR CURRENT EXISTING BUSINESSES IN THE AREA, FOR EXAMPLE, ROOT INSURANCE AND XP CLARIVATE ANALYTICS AND CVS HEALTH HAVE ALL RECENTLY ANNOUNCED EXPANSION IN THE CHANDLER MARKET.
SO A GOOD THINGS GOING THERE, MATT, THANK YOU FOR THIS.
ANY QUARTER, ANY YEAR WE'VE GOT CLOSURES AND, AND OPENINGS, UH, HOW DOES THIS TREND COMPARE? DO WE HAVE ANY OTHER DATA TO SAY SPECIFICALLY BECAUSE OF COVID WE, WE, WE SAW A GREATER CHANGE AT MAYOR, UNFORTUNATELY RIGHT NOW WE DON'T HAVE EXACT DATA TO BE ABLE TO IDENTIFY WHICH OF THOSE BUSINESSES ARE MORE COVID RELATED.
UM, YOU KNOW, THE TREND DATA THAT WE SEE IS KIND OF FLUCTUATING BECAUSE OF THE BUSINESS REGISTRATION HAS ONLY BEEN AROUND FOR ABOUT THREE YEARS NOW.
UH, SO WE SEE CONTINUED UPTICK IN, UM, REGISTRATE, REGISTRANTS.
UH, SO THERE'S NOT A GREAT INDICATOR.
I THINK THE RENEWAL PROCESS THAT WE GO THROUGH WILL BE A GOOD INDICATOR FOR US.
THERE'LL BE SUPER HELPFUL AS WE'D START ANALYZING THE DATA MORE AS WE GO OR CONTINUING UNDER SOME OF THESE CLOSURES, UM, HOME BUSINESSES, SOMEONE THAT WAS, UH, WHETHER, WHETHER IT WAS LIKE A CATERING OUT OF THEIR HOME OR LESSONS OUT OF THEIR HOME, BUT THEY WERE BUSINESSES OF CHANDLER.
WAS IT ALL ACROSS THE BOARD? YEAH, THAT IS CORRECT.
WE HAVE EVERYTHING FROM, UM, YOU KNOW, PHARMACIES THAT HAVE CLOSED TO SMALL BUSINESSES THAT ARE RUN OUT OF THEIR HOME, UH, TO LARGER BUSINESSES THAT JUST SOLD TO ANOTHER OWNER.
UH, SO NEW LLC IS TAKING OVER, UM, THE EXISTING BUSINESS.
THANK YOU, MAYOR COUNCIL MEMBER.
UM, I GOT A GENERAL QUESTION IN REGARDS TO THE MALL AND, UM, THE HOLIDAYS AS WELL AS INTEL.
UM, SO LET ME START WITH THE MALL.
I KNOW THAT THERE HAS BEEN SOME DISCUSSION ABOUT MAKING MORE, AND IF YOU CAN'T ANSWER THIS MAT, MAYBE STAFF COULD EITHER MICA OR CITY MANAGER COULD ANSWER THIS, OBVIOUSLY, BUT, UM, I WANNA KNOW WHAT THE STATUS OF THEIR PLANS ARE TO REFRESH THE MALL AND LOOK INTO THAT.
THAT IS A REVENUE DRIVER HAS BEEN A HUGE REVENUE DRIVER.
AND AGAIN, I WANT TO TAKE, GIVE YOU, TAKE A STAB THAT, WHAT DO YOU THINK THE HOLIDAY WOULD LOOK COMING THIS YEAR? CAUSE I BELIEVE THAT'S WHAT 40% OF OUR REVENUE 60.
I CAN'T REMEMBER EXACTLY WHAT THAT NUMBER.
I KNOW IT'S A LARGE PROPORTION OF IT.
THE MAYOR COUNCIL MEMBER ORLANDO, WE'LL GET TO A SLIDE WHERE YOU'LL SEE THAT SHARP INCREASE.
YOU'RE CORRECT IN THAT THE CHRISTMAS NUMBERS, DECEMBER SALES ARE SIGNIFICANT AND CHANDLER.
UM, AS FAR AS, YOU KNOW, KIND OF WHAT THE PLANS ARE FOR THE MALL, I'D HAVE TO DEFER TO THE CITY MANAGER ON THAT ONE, UM, MAYOR, COUNCIL MEMBER ORLANDO, UM, AND I'D CERTAINLY BRING MICAH UP FOR ANY SPECIFIC QUESTIONS THAT YOU HAVE.
BUT I DID RECENTLY SIT DOWN WITH DAVE MOSS, GENERAL MANAGER, UM, AT THIS MALL FOR MAY STORAGE.
AND, UH, RIGHT NOW THEY ARE GOING THROUGH SEVERAL INTERNAL STUDIES.
THEY ARE DEFINITELY, UM, HAVE INVESTORS THAT ARE INTERESTED IN REPOSITIONING THE MALL.
AND SO THEY ARE WORKING ON THOSE STUDIES AND WHAT HE ALLUDED TO ME, IT WOULD BE AFTER THE FIRST OF THE YEAR.
AND THEN THEY MAY BE TALKING TO THE CITY ABOUT WHAT SOME OF THOSE PLANS MIGHT BE.
AND SO MICAH AND MIGHT HAVE ANY ADDITIONAL INFORMATION THAT YOU DESIRE ON THIS ISSUE? NO, AND I THANK YOU CITY MANAGER, I KNOW YOU DIDN'T MEET AND THAT'S WHY I WANT TO MAKE SURE WE, CAUSE WE'VE GOTTEN CALLS FROM RESIDENTS.
UM, UH, THERE'S CONCERNS ABOUT THE MALL BEING VACANT STORES AND, UH, EVEN AS SMART AS TREES AND SHRUBBERY AND THINGS LIKE THAT, LOOKING NEEDS TO BE REFRESHED.
AND I THINK IT'S FAIR TO AT THIS STAGE BECAUSE WE'RE TALKING ABOUT CHANDLER FUTURE HERE, WHAT DO WE, YOU KNOW, ARE WE WORKING WITH THEM? WHAT ARE WE, YOU KNOW, IS THERE MORE WE COULD BE DOING OR HAVE TO WAIT FOR THESE REPORTS,
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MAYOR COUNCILMAN ORLANDO.SO YES, WE ARE WORKING VERY CLOSELY WITH MESA RICH, BOTH IN THE LOCAL MANAGEMENT, AS WELL AS THE MAIN OSTRICH NATIONAL OFFICES ON, UM, TO, TO DIFFERENT ISSUES RELATED TO THE PERFORMANCE OF THE MODEL.
ONE IS WHAT NEW TENANT MIXTURES CAN BE ADDED TO THE MALL TO HELP FILL SOME OF THOSE VACANCIES YOU TALKED ABOUT WHILE SIMULTANEOUSLY NOT IMPACTING ANY OF THE EXISTING TENANTS.
THE OTHER COMPONENT THAT MAY SEARCH IS UNDERGOING WORK COLLABORATIONS, WORKING WITH THEM AS THE CITY MANAGER ALLUDED TO IS THE COMPLETE REPOSITIONING OF MALLS.
SO FOR INSTANCE, THE NORDSTROM SITE, RIGHT MATRIX DOESN'T OWN THAT NORDSTROM'S HAS TAKEN IT OUT TO THE MARKET FOR SALE.
SO HOW CAN WE PARTNER COLLABORATE TO, UM, BRING THAT PROPERTY INTO A MASTER PLAN OF WHAT CHANDLER FASHION IS GOING TO LOOK FORWARD, LOOK TO INTO THE FUTURE? SO THOSE CONVERSATIONS ARE ONGOING.
UH, THE CONVERSATIONS HAPPEN FREQUENTLY WITH OUR TEAM.
UM, THEY ARE WORKING THROUGH THOSE TWO STUDIES AS THE CITY MANAGER SAID, SO THEY ARE WORKING ON IT.
UM, ON THE ECONOMIC DEVELOPMENT SIDE, WE'RE ALSO WORKING INDEPENDENT NET, UH, LEADS FOR NET NEW RETAILERS TO THE CITY TO HELP BACKFILL THE MALL SITE IN ANY OTHER LOCATIONS IN CHANDLER.
SO WE HAVE A FEW, UH, SPECIFIC RETAILERS THAT WE'RE REALLY LOOKING AT THAT WOULD BE NEW TO THE REGION.
SO, UH, WE'RE NOT GOING TO CANNIBALIZE FROM ANY OF OUR EXISTING RETAIL PROVIDERS.
AND AS YOU KNOW, THIS MORNING OR LATE YESTERDAY ANNOUNCED TWO DEVELOPER, BALD DEVELOPERS ARE FILING CHAPTER 11.
MATRIX IS NOT ONE OF THEM, OBVIOUSLY.
IT'S THERE ANYBODY THAT'S BEEN AROUND A LONG TIME MEMBERS, FIESTA MALL WAS THE PLACE TO GO, RIGHT? AND THERE'S NO LONGER FIESTA MALL, SO IT IS HAPPENING.
AND I'M GLAD WE'RE, WE'RE STAYING ENGAGED ON THIS BECAUSE IT'S IMPORTANT TO OUR, OUR FUTURE, OBVIOUSLY.
YES, MAYOR, IF I MAY COUNCIL MEMBER LINDA, UH, MICAH, DO YOU WANT TO ADDRESS THE ISSUE WITH THE PLANTINGS AROUND THE MALL OR I CAN BET THERE WAS A SPECIFIC REASON THAT PEOP UH, THE CITIZENS MAY BE SEEING THAT AND THEY'RE ADDRESSING IT, BUT I'LL LET MIKE AND PHIL.
CITY MANAGER THROUGH THE MAYOR COUNCIL MEMBER ORLANDO.
UH, THERE WAS SOME IRRIGATION CHALLENGES OUT AT THE MALL.
UM, SOME VALVES NOT BEING OPEN.
UM, THE MALL HAS SINCE IDENTIFIED THAT PROBLEM, UH, HIRED NEW LANDSCAPERS AND, UH, THE IRRIGATION SYSTEM AT THE MALL IS NOW UP AND RUNNING AND THEY ARE GOING THROUGH A REPLANT OF ALL THE VEGETATION THAT HAS, UH, WEATHERED IN OUR SUMMARY SWEET AND, AND DOING WELL.
I MEAN, AS FAR AS WE KNOW, THEY'RE STILL THEIR EXPANSION.
THEY'RE STILL WORKING ON THEIR INFRASTRUCTURES THROUGH THE MAYOR, COUNCIL, ORLANDO.
UH, INTEL'S IN A VERY GOOD POSITION.
UM, WE, WE TALKED TO HIM ON A, ON A REGULAR BASIS.
THINGS ARE PROGRESSING VERY WELL FOR THEM IN THEIR OPERATIONS, BOTH AT CHANDLER AND ALCATEL CAMPUSES.
I KNOW EX XP, UH, NXP JUST ANNOUNCED A $150 MILLION PROGRAM WITH THE US GOVERNMENT, WHICH IS KIND OF NICE.
THAT WILL BE MORE JOBS COMING TO CHANDLER.
SO THAT'S GOOD NEWS THERE TOO.
UH, THROUGH THE MAYOR CITY COUNCIL MEMBER ORLANDO ACTUALLY JUST GOT OFF A CALL WITH NXP THIS AFTERNOON, TALKING ABOUT THE, THE NEW FAB.
YOU TALKED ABOUT THE, THE G UH, GALLIUM NITRIDE, UH, PLANT THAT JUST OPENED AS WELL AS THE NEW TECHNOLOGIES THEY'RE LOOKING TO DO SO VERY MUCH ENGAGED WITH ALL OF OUR SEMICONDUCTOR MANUFACTURERS.
AND WE'RE REALLY FORTUNATE, LIKE MATT SAID TO HAVE SUCH A WELL DIVERSIFIED ECONOMY.
LOOKING FORWARD TO THE STRATEGIES ON THOSE.
SO, UM, AS WE STATED BEFORE, THE RENEWAL PROCESS REALLY HELPED US KIND OF DISTINGUISH BETWEEN BRAND NEW BUSINESSES AND THOSE THAT ARE JUST RE NEW, NEWLY REGISTERED, AND THEN PROVIDE A BETTER PICTURE AS WE GO FORWARD.
SO WE'LL BE BRINGING ADDITIONAL DETAILS FOR YOU THAT, UM, ON NEXT TIME, UH, BUT WE DO WANT TO MENTION, YOU KNOW, KUDOS TO OUR ECONOMIC DEVELOPMENT TEAM.
THEY DO A FANTASTIC JOB OF ENSURING THAT MIX, UH, WHICH REALLY KIND OF PUTS US IN AN ENVIABLE POSITION AND FOR MANY LOCATIONS THROUGHOUT THE UNITED STATES AND INCLUDING ARIZONA, UM, AS FAR AS KIND OF THE BUSINESS MIX THAT WE HAVE, UH, WHEN WE LOOK AT, UH, PASS THROUGH RESIDENTIAL UTILITY TRENDS.
SO WE LOOKED AT THIS LAST TIME WHEN WE SAW INCREASES, UH, COMING OUT OF APRIL, MAY AND JUNE, UH, WE CONTINUE TO SEE THOSE INCREASES, BUT THEY'RE, UM, SUBSTANTIAL GOING INTO JULY, AUGUST, SEPTEMBER.
UM, THE BALANCES ON THOSE ACCOUNTS, OBVIOUSLY INCREASING AS WELL EXPONENTIALLY.
UH, WE DID BEGIN A SOFT NOTICE, UM, TO OUR, OUR WATER UTILITY CUSTOMERS THAT ARE CURRENTLY, UH, BEHIND ON THEIR PAYMENTS, UH, THAT BEGAN ON OCTOBER 19TH.
UH, BUT WE'RE STILL DON'T HAVE DISCONNECTIONS OR LATE FEES.
UH, WE HAVE SEEN SOME GOOD PROGRESS THOUGH FROM THOSE THAT, UH, LETTER CAMPAIGN THAT WE'VE INITIATED FROM INDIVIDUALS CALLING, SETTING UP PAYMENT ARRANGEMENTS AND, AND MAKING SURE THAT THEY'RE COMPLIANT WITH THEIR CURRENT BILLS.
UM, AND, AND REALLY THAT'S ONE OF THE MAIN GOALS THAT WE HAVE IS TO MAKE SURE THAT, THAT THE, WHEN IT COMES TIME TO START DISCONNECTS THAT, UH, THOSE INDIVIDUALS THAT ARE HAVING ISSUES OR STRUGGLES RIGHT NOW, AREN'T ON THAT LIST.
AND THAT'S DONE THROUGH, YOU KNOW, COMMUNICATING WITH OUR OFFICE, UM, AND SETTING UP PAYMENT ARRANGEMENTS.
[00:25:01]
NEIGHBORHOOD SERVICES ON OUTREACH, UM, AND ASSISTANCE WITH OUR NONPROFIT PARTNERS, UH, ENSURING THAT PEOPLE KNOW WHERE THEY CAN GO, SHOULD THEY HAVE NEEDS, UM, SPECIFIC TO UTILITY ACCOUNTS AND, AND IMPACTING THAT.UM, SO, YOU KNOW, WE'RE ALSO IN COMMUNICATION.
WE HAD A MEETING JUST THIS WEEK, UH, WITH OTHER VALLEY CITIES TO SEE WHAT THEIR PLAN IS AS FAR AS ROLLING OUT, UH, WITH DISCONNECTS ON WATER UTILITY ACCOUNTS.
UM, I THINK MESA IS THE ONLY ONE RIGHT NOW THAT STARTED ON NON-RESIDENTIAL ACCOUNTS.
SO ANYONE THAT'S NOT A CURRENT RESIDENT OF MESA, BUT HAS A UTILITY ACCOUNT WITH THEM.
UH, THEY STARTED THEIR PROGRAM.
OTHERS ARE KICKING OFF IN NOVEMBER, THE CITY OF PRESCOTT AND, UH, ONE OTHER, AND THEN, BUT THE MAJORITY ARE STARTING AT THE BEGINNING OF THE YEAR AT SOME POINT.
SO WE'RE IN, UM, CURRENTLY PLANNING OUT HOW THAT'S GOING TO BE PHASED, UH, WITHIN THE CITY OF CHANDLER.
AND WHEN WE WANT TO ROLL OUT, UH, DISCONNECTS VERSUS JUST THE SOFT NOTICES, BUT SOFT NOTICES WILL CONTINUE, UH, OUTREACH ON A PROGRESSIVE NATURE WILL CONTINUE TO TRY TO ENSURE THAT AS MANY OF THESE INDIVIDUALS RECEIVE HELP, THAT CAN, OKAY, SO NOW WE'RE GOING TO JUMP RIGHT INTO OUR CURRENT REVENUES FOR THE QUARTER.
SO THIS IS A, UH, SLIDE THAT LOOKS AT THE ACTUAL FIRST QUARTER FOR THE LAST SEVERAL YEARS AND LETS US KNOW KIND OF WHERE WE RATE IN COMPARISON.
SO WHEN YOU LOOK JUST OVER, UM, EACH OF THOSE QUARTERS, YOU CAN SEE WE'VE, UH, INCREASED YEAR BY YEAR.
WHEN WE TAKE THE TOTAL PRORATED BUDGET, WE TAKE THE TOTAL BUDGETED REVENUES AND WE LOOK AT WHAT WE TYPICALLY COLLECT IN THE FIRST QUARTER.
AND WE USE THAT PERCENTAGE TO SAY, WE SHOULD BE AT LEAST AT THIS DOLLAR FIGURE.
THAT DOLLAR FIGURE IS 53.5 MILLION.
UH, RIGHT NOW WE'RE AT 61.6 MILLION.
SO WE'RE ABOUT 15% OR $8 MILLION ABOVE OUR YEAR TO DATE ADOPTED BASED ON HISTORICAL TREND.
SO WHAT WE WOULD HISTORICALLY COLLECT BASED ON OUR CURRENT YEAR'S ANTICIPATED REVENUES, UH, WE'RE OVER BY ABOUT 8 MILLION.
IF YOU LOOK AT JUST COMPARED TO THE PRIOR FISCAL YEAR, THE FIRST QUARTER OF THE PRIOR FISCAL YEAR, AND THAT'S PRIOR TO ANY OF THE COVID, NO ONE HAD AN INKLING THAT IT WAS COMING YET.
WE HAD A STRONG YEAR LAST YEAR.
UH, WE'RE STILL, UH, 2.3% ABOVE LAST YEAR'S FIRST QUARTER, $1.4 MILLION ABOVE THE SAME PERIOD LAST YEAR.
SO VERY STRONG REVENUE NUMBERS COMING IN.
UH, THESE ARE, UM, YOU KNOW, ACROSS A VARIETY OF DIFFERENT REVENUE STREAMS FROM OUR LOCAL TRANSACTION PRIVILEGE TAX, UH, URBAN REVENUE SHARING, LICENSE PERMITS, CHARGES FOR SERVICES, FINES, AND FORFEITURES INVESTMENTS, UM, AND OTHER REVENUES.
SO THIS IS KIND OF THE FULL GENERAL FUND REVENUE, UM, ALTHOUGH THE WHOLE GAMUT.
SO, UM, LET ME ASK THE PERSON THEN COUNCIL MEMBER STEWART.
SO WHERE ARE THE, THE DOLLARS THAT WERE, UH, THE CARES ACT DOLLARS? ARE THOSE PART OF THIS PROJECTION AT ALL? OR ARE THOSE IN OTHER OTHER FIGURES? YEAH.
THOSE DOLLARS ARE NOT INCLUDED IN THIS.
THOSE ARE NOT PART OF OUR GENERAL FUND REVENUES.
THOSE CAME IN THROUGH GRANT FUNDING.
SO THEY'RE CURRENTLY IN OUR GRANT FUNDS RIGHT NOW, UH, WHICH IS SEPARATE FROM THE TOTAL GENERAL GENERAL REVENUE FUNDS.
SO, UM, THIS IS WITHOUT THOSE DOLLARS BEING ADDED TO THEM.
IT'S THE SAME ONES, YOUR QUESTION HERE, WOULD YOU SUSPECT THAT THE CARES ACT FUNDING IS ONE OF THE PRIMARY REASONS FOR THIS? UM, AS IT'S MORE THAN IT'S ABOUT FLAT IN WHAT WE THOUGHT WAS GOING TO BE A RECESSION, UM, THE DOLLARS THAT CAME INTO THE STATE AND THE NEW, OUR CITY SPECIFIC RECORDS FOR THAT COUNCIL MEMBER STEWART IT'S, IT'S NOT REALLY A DIRECT RESULT OF THOSE DOLLARS AS MUCH AS, AS, AS IT IS A RESULT OF MANY FACTORS.
ONE OF THE THINGS THAT WE'RE SEEING IS DECLINED SPENDING IN CERTAIN CATEGORIES.
SO HOTEL MOTEL, RESTAURANT BAR, UH, TRAVEL IS DOWN SIGNIFICANTLY.
UH, BUT WHERE PEOPLE ARE TRYING TO THEY'RE FUNNELING THEIR SPENDING FROM THOSE CATEGORIES, THEY'RE NOT JUST RESERVING IT OR SAVING IT, THEY'RE SPENDING IT IN OTHER AREAS.
SO WE'VE SEEN SIGNIFICANT INCREASES IN THINGS LIKE HOME IMPROVEMENT AND IN RETAIL SALES.
UM, SO THE DOLLARS AREN'T NECESSARILY GOING AWAY, THEY'RE LEAVING CERTAIN CATEGORIES AND ADDING TO OTHER CATEGORIES.
SO WHEN YOU LOOK AT RETAIL, SPECIFICALLY, RETAIL HAS SEEN A SIGNIFICANT INCREASE YEAR OVER YEAR OF DOUBLE DIGIT GROWTH IN RETAIL.
AND THAT HAS PRIMARILY TO DO WITH THAT REALLOCATION OF FUNDING.
NOW, THE FEDERAL DOLLARS, THE CARE'S DOLLARS AND THINGS HAVE SPAWNED A CERTAIN SPENDING IN DIFFERENT AREAS, GOVERNMENT SPENDING, UH, AS WELL AS SOME CONSTRUCTION SPENDING, AS WELL AS THE, UM, INDIVIDUAL PAYMENTS THAT WERE MADE TO FAMILIES.
THOSE HELPED SPURN SOME ADDITIONAL ECONOMIC PAYMENTS INTO THE LOCAL ECONOMY AS WELL.
SO THOSE THINGS ARE ALL PART OF THESE NUMBERS.
UM, BUT THEY'RE, IT'S NOT DIRECTLY ATTRIBUTED TO JUST THE FEDERAL SPENDING.
IT'S KIND OF THAT REDISTRIBUTION OF SPENDING HASN'T STOPPED.
AND I THINK WITH FOLLOWING UP WITH COUNCIL MEMBER STEWART WOULD ALMOST SEEM THAT LIKE EVEN THE DIRECT DOLLARS TO BUSINESSES THAT WERE BORING
[00:30:01]
EMPLOYEES, THOSE REALLY WOULD HAVE BEEN SPENT ON FOURTH QUARTER, THIRD QUARTER, FOURTH QUARTER LAST YEAR, RIGHT.RATHER THAN CARRY OVER TO EFFECT THESE NUMBERS AND SALES TAX THIS YEAR, UNLESS PEOPLE WERE JUST HANGING ONTO THEIR MONEY A LITTLE LONGER.
YOU'RE GOING TO SEE THERE'S GOING TO BE JUST SOME SHIFT IN THE PATTERNS, BUT IT'S NOT GOING TO BE A SIGNIFICANT ENOUGH EFFECT.
SO AS WE RECEIVE AC CARRIAGE DOLLARS, FOR EXAMPLE, AND CAN REDISTRIBUTE THAT TO, UH, PROVIDE PAYROLL ASSISTANCE OR, UM, MONIES FOR, UH, PERSONAL PROTECTIVE EQUIPMENT AND THINGS LIKE THAT, TYPICALLY THOSE WILL GO BACK INTO YOUR LOCAL ECONOMY AND YOU'LL SEE A NET IMPACT.
UM, BUT WHAT WE'RE SEEING IS THAT THOSE, THE IMPACT HASN'T BEEN DIRECTLY ATTRIBUTED TO THOSE TYPES OF DOLLARS.
SO, UM, THIS SLIDE YOU'LL REMEMBER FROM LAST TIME WE, WE TRY TO KIND OF PLOT ON A GRAPH, UM, WHEN SOME SPECIFIC DATES HAPPENED OR SOME SPECIFIC, UM, ACTIVITIES HAPPEN.
SO WHETHER OR NOT, UH, ARIZONA CLOSED DOWN OR WHEN KIND OF THINGS HAPPEN, THE FEDERAL STIMULUS PAYMENTS STARTED THINGS LIKE THAT.
UM, AND WE WANTED TO KIND OF KEEP THAT TREND UP SO WE CAN KIND OF SEE HOW THINGS PROGRESS.
NOW, OUR HOPE OBVIOUSLY IS THAT WE DON'T HAVE ANY MORE LINES TO PLOT ON THIS GRAPH.
WE DON'T WANT ANY EVENTS TO HAPPEN WHERE WE NOW NEED TO TRACK SINCE THAT CLOSURE OR THAT REDUCTION IN OPPORTUNITIES HAS HAPPENED.
SO, YOU KNOW, OUR, OUR GOAL IS TO CONTINUE TO TREND THAT OUT AND JUST VERIFY HOW THINGS ARE COMING IN.
YOU'LL NOTICE JULY AND AUGUST WERE SLIGHTLY UNDER THE PRIOR YEAR, BUT SEPTEMBER WAS A SIGNIFICANT INCREASE FROM THE PRIOR YEAR.
AND THAT'S LEVEL THIS OUT TO BE, UM, HIGHER THAN THE QUARTER OVERALL, BUT YOU CAN KIND OF SEE JUST ON A MONTH BY MONTH BASIS.
AND THEN GOING BACK TO COUNCIL MEMBER ORLANDO'S EARLIER COMMENT, YOU'LL SEE THAT SIGNIFICANT SPIKE THERE AT THE END OF THE YEAR.
AND THAT'S OUR, OUR HOLIDAY SALES, UH, THAT HAPPENED IN DECEMBER AND THOSE REPORTS COME IN IN JANUARY.
SO, UM, THAT'S ONE THAT WE'LL DEFINITELY BE WATCHING.
AND WHEN WE COME BACK WITH OUR NEXT UPDATE, WE'LL HAVE THOSE NUMBERS FOR YOU TO SHOW KIND OF HOW THOSE HOLIDAY SALES WENT THROUGHOUT THIS YEAR.
SO EXPENDITURES IS THE NEXT TOPIC THAT WE WANTED TO COVER.
UM, THIS SHOWS WHERE WE ARE FROM A QUARTER TO QUARTER COMPARISON OVER THE LAST FEW YEARS, UH, YOU'LL NOTICE THERE'S A WHITE LINE ACROSS ALL OF THE MAROON COLORED BARS, UM, AND EVERYTHING ABOVE THAT IS THE ADDITIONAL PUBLIC SAFETY PENSION PAYMENT THAT WE MADE TO PSP RS, UH, EVERYTHING BELOW THAT IS OUR KIND OF STANDARD TYPICAL EXPENDITURES.
SO RIGHT NOW WE'RE COMING IN AT 64.2 MILLION AS FAR AS OUR EXPENDITURES, WHICH IS SIGNIFICANTLY UNDER LAST YEAR'S, UM, EXPENDITURE LEVEL.
UH, SO, YOU KNOW, WITH THE CURRENT EXPENDITURE MEASURES IN PLACE STILL, WE'RE, WE'RE SEEING A SIGNIFICANT SAVINGS FROM AN OPERATION STANDPOINT.
UM, WE'RE TYPICALLY AT ABOUT, UH, YOU KNOW, 33.8 IS NORMAL.
SO WE DID WANT TO PROJECT OUT THOUGH WHAT THAT WOULD LOOK LIKE, WHERE ARE WE TO MAKE THAT PUBLIC SAFETY PENSION PAYMENT? AND WHAT WOULD THAT LOOK LIKE NEXT QUARTER? SO THIS NEXT SLIDE DOES THAT.
IT LOOKS AT QUARTER TO WHAT WE WOULD PROJECT QUARTER TWO TO LOOK LIKE IF WE WERE TO BE ABLE TO MAKE THAT $15 MILLION PAYMENT THAT WE APPROPRIATED IN THIS YEAR'S BUDGET FOR PUBLIC SAFETY PENSION.
UM, SO THAT TAKES IT UP, UH, CLOSER TO LAST YEAR SPENDING.
UH, BUT YOU'LL STILL SEE THAT EVEN WITH THAT EXPENDITURE GOING IN, UH, WE WILL STILL BE UNDER, YOU KNOW, WHEN YOU REDUCE OUT THE PUBLIC SAFETY PORTION OF THOSE GRAPHS, WE'RE STILL BE UNDER, UH, WHERE WE WERE LAST YEAR AND, AND TRENDING VERY WELL.
AS FAR AS THE EXPENDITURES, UM, STANDPOINT TO THE POLICY QUESTION THAT WE HAD IN THIS FISCAL YEAR, WE BUDGETED $15 MILLION PAYMENT.
UM, AND THEN WE DECIDED THROUGH MAYOR AND COUNCIL'S DIRECTION THAT WE WOULD HOLD THAT AS WE'VE EVALUATED THE REVENUES COMING INTO THE CITY.
UH, WE NOW HAVE, UH, TWO QUARTERS OF ACTUAL NUMBERS FROM COVID RELATED IMPACTS.
UH, WE HAVE AN ESTIMATE OF THE NEXT QUARTER, WHAT EXPENDITURES WILL LOOK LIKE GOING INTO THE SECOND QUARTER OF THIS CURRENT FISCAL YEAR.
UM, AND WITH THAT INFORMATION MAYOR AND COUNCIL, WE'D LIKE TO GET DIRECTION FROM YOU ONTO WHETHER OR NOT TO MOVE FORWARD, UH, WITH THIS $15 MILLION PAYMENT, UH, THE SOONER WE MAKE THE PAYMENT, THE SOONER THAT THAT PAYMENT HAS OPPORTUNITY TO GROW, UH, AND INTEREST ON THAT ACCUMULATES IN OUR FAVOR INSTEAD OF, UM, IN A NEGATIVE WAY.
SO RIGHT NOW OUR CURRENT OUTSTANDING LIABILITY, THERE'S AN INTEREST COMPONENT TO THAT THAT INCREASES OUR LIABILITY.
AND BY MAKING THAT PAYMENT, THAT INTEREST THAT WE THEN EARN ON THAT, UH, REVENUE THAT'S RECEIVED BY THE PENSION FUND IS EARNED AND BENEFITS US, UM, AND REALLY BY FRONT-LOADING THOSE PAYMENTS, WE CAPITALIZE, UM, ON THE COMPOUNDING INTEREST AND ACHIEVE TWO MAIN GOALS.
THE FIRST ONE IS FLEXIBILITY IN OUR OUT YEARS WHEN THE MANDATORY PAYMENTS WOULD OTHERWISE BE MORE ONEROUS ON US.
[00:35:01]
WE ADD FLEXIBILITY IN OUR OUT YEARS AND THEN NUMBER TWO, BY USING INTERESTS IN OUR FAVOR, UM, WE'RE ADDING IT INSTEAD OF AS A, AN INCREASE TO US INSTEAD OF AS A COST.UM, AND WITH THAT MAYOR, UH, WE'LL TURN IT OVER TO YOU FOR DISCUSSION AS FAR AS A DIRECTION FOR STAFF ON THIS.
MA'AM THANK YOU FOR THIS PRESENTATION.
IT CERTAINLY IS HEARTWARMING TO HEAR THAT, UH, RELATIVELY WE'RE IN VERY GOOD SHAPE AND ENABLED TO CONTINUE TO NOT JUST DO THE BUSINESS OF GOVERNMENT, BUT TO CONTINUE TO PLAN AND HAVE OPTIONS OF WHAT WE DO WITH THOSE PLANTS.
SO THANK YOU, COUNSEL, WHAT ARE YOUR THOUGHTS ON, UM, THE QUESTION BEFORE US, THAT'S A MEMBER OF LANDO.
I JUST HAVE A COUPLE OF QUESTIONS, MATT, ON THE PENSION PLAN AGAIN.
UM, SO THE ONE 46 FOUR WAS BECAUSE OF THE RECALCULATION THEY DID LAST YEAR, CORRECT THROUGH THE MAYOR COUNCIL MEMBER, ORLANDO, WHICH ONE ARE YOU REFERRING TO, SIR? THE PREVIOUS CHART, UH, 20, 20, 19 TO 2020.
SO THAT SPIKE WAS BECAUSE OF THE RECALCULATION.
FROM LAST YEAR, THEY HAD THE NEW TOOL, THEY HAD NEW, UH, X-RAY TABLES, ET CETERA.
THROUGH THE MAYOR COUNCIL MEMBER ORLANDO, THAT'S ACTUALLY THE ACTUAL SPEND THAT WE HAD THROUGH QUARTER TWO.
SO THAT'S EVERYTHING WE SPENT, INCLUDING THAT $25 MILLION PAYMENT THAT WE MADE TO P S P R S.
UM, THAT'S INCLUDED IN THAT $146 MILLION.
IT WAS 25.7 MILLION, THE EXCESS OVER AND ABOVE OUR REQUIRED.
SO LAST YEAR THEY GAVE YOU A TOOL, UM, TO BE ABLE TO PLUG NUMBERS IN.
ARE WE PRETTY CLOSE TO WHAT THE STATE IS TELLING US WE OWE OR, UM, HOW WHAT'S THE FIDELITY OF THAT TOOL? YEAH.
THROUGH THE MAYOR COUNCIL MEMBER ORLANDO.
THE TOOL HAS BEEN VERY BENEFICIAL TO US AS WE LAST YEAR THROUGH THE BUDGET PROCESS, TRY TO EVALUATE WHERE WE WERE IN THE PLAN.
UM, WE USE THAT TOOL BECAUSE WE COULD ADD IN SOME OF THE ANTICIPATED IMPACTS THAT THE BOARD WOULD MAKE SOME CHANGES, THAT THEY WERE PLANNING ON MAKING, UH, WHAT WASN'T TAKEN INTO ACCOUNT AT THAT TIME WHERE THE ACTUAL RESULTS OF, OF WHAT THEY'VE DONE.
SO THEY HAVE NOW VOTED TO MAKE SOME SPECIFIC CHANGES TO THE PUBLIC SAFETY PENSION, UM, WHICH WILL AFFECT OUR LIABILITY.
AND WE DON'T HAVE OUR NEW ACTUARIAL REPORT YET THAT WILL COME AT THE BEGINNING OF DECEMBER, WE'LL HAVE THAT INFORMATION, BUT IT WILL IMPACT OUR TOTAL LIABILITY BECAUSE SOME OF WHAT WE PUT IN AS OUR, OUR ANTICIPATION, UH, WE ANTICIPATED THESE CHANGES.
THEY DIDN'T MAKE SOME OF THE CHANGES.
THEY ONLY MADE A PORTION OF THEM.
AND SO IT WILL REDUCE THE TOTAL OUTSTANDING.
UM, ALTHOUGH WE HAVE TO HAVE A, WE'RE HAVING A MEETING WITH THEM ABOUT, YOU KNOW, WHEN OUR, WHAT'S THE PLAN TO KIND OF RATCHET THAT BACK TO WHAT THEIR ANTICIPATED CHANGES WERE GOING TO BE IN THE PRIOR YEAR.
SO, UM, THERE'S MORE TO COME ON THAT AS WE AGE, GET OUR ACTUAL, OUR ACTUAL ACTUARIAL REPORT, UH, FROM THEM.
AND THEN BE, AS WE HAVE THOSE FURTHER DISCUSSIONS AS WHAT THEIR PLANNING IS TO MAKE THOSE CHANGES GOING FORWARD, THEY DIDN'T WANT TO DO EVERYTHING ALL AT ONCE.
UM, BUT WE NEED TO KNOW WHEN THEY KIND OF SLATE TO MAKE ADDITIONAL CHANGES THROUGH TIME.
SO WE KNOW HOW TO PLAN FOR THAT ADDITIONAL LIABILITY THAT MAY BE OUT THERE.
IS THAT, UH, ON TOP OF THE ONE 30 WORDS, IF WE PUT THE 15 ADDITIONAL DOLLARS, THAT'LL DRIVE IT TO ONE 32, CORRECT.
MEMBER ORLANDO, THAT WOULD BE OUR TOTAL ANTICIPATED SPEND IN QUARTERED THROUGH QUARTER TWO WOULD BE 132.2 IN 15 MILLION.
SO IF WE DID DO THE $15 MILLION, WE'D BE LOOKING AT 117 OR 17, WHICH WOULD BE A LITTLE BIT OKAY.
THANK YOU, MAYOR COUNCIL MEMBER ORLANDO.
I WANT TO MAKE SURE WE'RE ANSWERING THE QUESTION YOU'RE ASKING.
CAUSE I GOT A LITTLE BIT LOST THERE.
ARE YOU ASKING WHAT THE BALANCE OF THE PSP RS WOULD BE? BECAUSE WHAT WHAT'S IN FRONT OF YOU IS NOT THAT, SO I JUST WANT TO MAKE SURE THAT WE'RE ANSWERING YOUR QUESTION CORRECTLY.
SO THAT'S WHAT I THOUGHT THIS WAS THE BALANCE.
THIS, THE CHART IN FRONT OF YOU IS NOT MATT.
YOU WANT TO EXPLAIN THAT A LITTLE BIT BETTER? SORRY.
I JUST WANTED TO MAKE SURE WE GOT THE RIGHT QUESTION.
THAT'S THE ACTUAL TOTAL SPENDING FOR THE CITY IN GENERAL FUND.
SO WE WILL, INCLUDING RPS, PRS PAYMENT AND ALL SPENDING FOR OPERATIONS GOT TO SPEND 130, 2 MILLION.
SO WHAT CHART DO YOU HAVE SHOWING THAT THE, I KNOW YOU, YOU BRING THAT OUT EVERY COUPLE OF MONTHS, WHICH YOU HAVE A CHART THAT SHOWS THE ACTUAL, I DO HAVE A, UH, A CHART HERE AT THE BACK THAT I CAN SKIP TO.
UM, THIS IS ONE THAT WE SHOWED YOU, UM, LATE LAST YEAR, MARCH TIMEFRAME ON THIS KIND OF SHOWS WHAT THE DIFFERENCE WOULD BE IN THE TOTAL OBLIGATION.
IF WE WERE TO MAKE THE PAYMENTS VERSUS NOT MAKING IT WHAT I'M DRIVING AT.
SO, UH, AS YOU LOOK FISCAL YEAR 21 HERE, IF WE WEREN'T TO MAKE THAT $15 MILLION PAYMENT, OUR BALANCE, OUR ANTICIPATED BALANCE AT THAT TIME USING ALL THE DATA THAT WE HAD FROM, UH, THE PUBLIC SAFETY PENSION BOARD, UH, WE ANTICIPATED, IF WE MADE THE PAYMENT, WE'D HAVE A BALANCE OF 167 MILLION WITHOUT THAT IT'D BE ABOUT
[00:40:01]
194 MILLION.SO YOU CAN SEE THROUGHOUT TIME HOW IT KIND OF TICKS DOWN AS WE MAKE THOSE ADDITIONAL PAYMENTS, WHAT OUR BALANCE WOULD BE.
SO THAT 15 MILLION IS ALMOST DOUBLE, UH, TO THE REDUCTION OF THE PAYMENT, CORRECT THROUGH THE MAYOR COUNCIL MEMBER, ORLANDO, THAT COMPOUNDING INTEREST OVER THE NEXT 17 YEARS AT THIS PLAN GOES THROUGH, HAS A SIGNIFICANT IMPACT OR THE LIFE OF THIS OBLIGATION.
THANK YOU, CITY MANAGER FOR CATCHING THAT.
THAT'S REALLY GOOD TO HEAR HOW WELL WE'RE DOING FINANCIALLY.
I'M NOT SURE IF THIS IS THE FORUM FOR A POLICY QUESTION, OUR PSP RS, THAT SOUNDS LIKE THERE'S A LOT OF MOVING PARTS THAT YOU WERE JUST REFERRING TO, THAT WE MIGHT WANT TO HAVE ANOTHER SESSION ABOUT THIS BEFORE WE MAKE A BIG DECISION ABOUT $15 MILLION.
I SHOULD MAKE MY QUICK, UH, MY QUICK THOUGHTS ON THAT AS IT RELATES TO THE OVERALL BUDGET THOUGH, ARE WE FORESEEING A, UM, UH, CONTINUING TO MOVE FORWARD WITH OUR BUDGET OVERALL? SO THERE'S A LOT OF LIKE LEVERS THAT WE WERE GOING TO SWITCH OFF AND ON, DEPENDING ON HOW THE ECONOMY WENT, IT LOOKS LIKE WE'RE GOING TO BE ABLE TO FLIP MO MOST OF THOSE ON CONTINUOUS CAPITAL IMPROVEMENT AND THINGS LIKE THAT.
IS THAT KIND OF THE OVERARCHING THEME HERE? YEAH.
SO, UM, YES, YOU RECALL, WE DID PUT INTO PLACE SEVERAL SPENDING REDUCTIONS, INCLUDING TRAVEL, WHICH IS STILL ON HOLD UNTIL JANUARY.
AND THEN WE'LL TAKE A LOOK AT WHAT'S COMING IN AND MAKE A DECISION AT THAT POINT IN TIME.
UM, AS FAR AS, UH, POSITION, I HAD HELD THOSE FOR SEVERAL MONTHS, UM, EXCEPT FOR PUBLIC SAFETY, UM, AND THOSE AREAS, BUT IN THE LAST, I WOULD SAY COUPLE OF MONTHS, I HAVE, UH, STRATEGICALLY POSTED A NUMBER OF POSITIONS.
SO THOSE, SOME OF THEM HAVE BEEN FILLED.
OTHERS HAVE NOT YET, BUT WE CONTINUE TO MONITOR THAT, NOT GOING TO JUST DO A FULL BLITZ ON IT TO, WE KNOW WHAT OUR, OUR REVENUES LOOK LIKE.
UM, AND SO WE ARE CONTINUING TO MONITOR THAT IN TERMS OF CAPITAL PROJECTS, UM, FOLLOWING THE LAST QUARTERLY REVIEW WITH COUNCIL MEMBERS, UM, I DID LOOK AND SEE IF THERE WERE A FEW OF THOSE, NOT ALL, BUT A FEW, LIKE, I WILL GIVE YOU AN EXAMPLE OF, UH, THE FIRE STATION DESIGN.
SO TOLD THEM THEY COULD MOVE FORWARD WITH DESIGN ONLY, UM, AT THIS POINT IN TIME.
AND THERE'S A FEW OTHERS THAT WERE ON THE B LIST.
I WILL CALL IT THAT KIND OF, WE SLIPPED OVER TO A, HAVE THEY ALL APPEARED IN FRONT OF YOU YET? NO, BUT STAFF STARTED THE PROCESS OF ACTUALLY DOING THE WORK BEHIND THE SCENES, EITHER FOR PUTTING IT OUT FOR REQUESTS, FOR PROPOSALS OR BIDS OR WHATEVER THE CASE MAY BE.
SO VERY SLOWLY TRICKLING THAT FORWARD DEPENDING, BUT WE CONTINUE TO WATCH THE REVENUES, UM, BECAUSE WE DON'T WANT TO GET OPPOSITE IN TERMS OF THAT.
SOUNDS LIKE WE'RE GOING TO CONTINUE TO MOVE FORWARD.
I'LL KEEP, KEEP THE, UH, KEEP THE TRAIN TRUCKING AND THEN COUNCIL MEMBER ONE.
SO GIVEN, YOU KNOW, THINGS LOOKING LIKE IN THAT B TREND AND, UM, KIND OF CARRIES ON PICKS UP WHERE IT, WHERE IT LEFT OFF.
UM, ARE WE IN THE CRYSTAL BALL BETWEEN YOU ALL AND MIKE, ARE WE THINKING THERE'S GOING TO BE ANOTHER DIP WITH THE HOUSING, WITH THE, IN THE EVICTIONS COMING IN JANUARY? DO WE THINK THAT, I MEAN, OUR, THE TECH SECTOR SEEMS TO BE GOING WELL, BUT ARE WE GOING TO SEE THAT IMPACTING CONSTRUCTION OTHER AREAS? ARE WE BUILDING THAT INTO OUR PLAN FOR NEXT QUARTER? YEAH.
THROUGH THE MAYOR, VICE MAYOR LOPEZ.
UM, UNFORTUNATELY IT'S NOT ONE WITH AN EASY ANSWER.
UM, YOU KNOW, WE, WE DO ABSOLUTELY LOOK AT ALL OF THESE FACTORS WHEN WE'RE TRYING TO FORECAST HOW THINGS ARE GOING TO GO.
UH, BUT THERE'S VERY, THERE'S JUST TOO MANY UNKNOWNS RIGHT NOW, UM, WHERE WE'RE IN A SPOT WHERE WE CAN'T GIVE A GREAT ANSWER TO THAT.
UH, WE DO ANTICIPATE THAT THINGS WILL CONTINUE TO GO WELL, EVERY ECONOMIC INDICATOR THAT WE'VE SEEN HAS SHOWN THAT THINGS WILL, ARE PROGRESSING AND GOING IN THE RIGHT DIRECTION.
WE ANTICIPATE THAT TO CONTINUE.
UH, HOWEVER COVID CASES HAVE BEEN INCREASING.
UH, WE HAVE AN ELECTION TOMORROW THAT COULD GO ONE WAY OR ANOTHER.
UH, WE DON'T KNOW EXACTLY WHAT THE FUTURE IS GOING TO BRING WITH SOME VERY IMPORTANT ASPECTS OF OUR ENVIRONMENT.
UH, SO, YOU KNOW, WHILE EVERY INDICATOR POINTS THAT THINGS ARE GONNA CONTINUE AS THEY'RE GOING PROGRESS, UH, BUSINESS OWNERS ARE JUMPING IN THE MARKET.
UH, MANUFACTURERS ARE BUYING RAW MATERIALS.
UM, ALL OF THEIR LOOKING FORWARD ALSO IS PROJECTING THAT THINGS WILL CONTINUE TO MOVE FORWARD AND BE GOING WELL.
UM, SO THAT'S KIND OF WHAT THE, THE POINT THAT WE'RE AT RIGHT NOW IS WE RELY ON THEM TO THE BEST OF OUR ABILITY AS WE'RE TRYING TO MAKE OUR PROJECTIONS.
AND RIGHT NOW OUR PROJECTIONS ARE WORKING TO YOU TO SEE STRONG REVENUE GROWTH OVER THE NEXT QUARTER AND STRONG.
AND WITH THE CURRENT MEASURES IN PLACE, SEE EXPENDITURES CONTINUE TO BE REDUCED, WHICH WILL PUT US IN A GREAT POSITION TO FLIP THOSE SWITCHES AS COUNCIL MEMBERS DO IT ACKNOWLEDGED IT COMES FROM NUMBER ONE.
[00:45:01]
SO I WOULD LIKE TO ASK, UH, HOW DID YOU COME OUT WITH THE 15 MILLION PAYMENT FOR THE A P S P I S HOW, HOW YOU COME UP WITH THIS NUMBER IS LED A MORE LOOM TO INCREASE THIS AMOUNT.GREAT QUESTION THROUGH THE MAYOR COUNCIL MEMBER WONG.
I'M GOING TO TURN THAT OVER TO DON LANG.
UH, THAT WAS PRIOR TO ME COMING INTO THE 15 MILLION WAS KIND OF ESTABLISHED.
SO I'LL LET DON KINDA MENTIONED, UH, SPEAK TO THAT NUMBER FOUR.
EVERY YEAR WE UPDATE BASED ON OUR NEW ACTUARIAL INFORMATION, RPS PRS PAY DOWN PLAN.
UM, THROUGH THIS PAST BUDGET PROCESS WAS THE YEAR WE HAD ACCESS TO THE NEW TOOL THAT WAS PUT OUT BY, UH, PSP RS.
AND THEY, UM, IT HELPED US BETTER QUANTIFY WHAT THE IMPACTS OF BOARD DECISIONS WOULD BE.
UM, WE'VE ALWAYS HAD A PRETTY SIGNIFICANT OVERPAYMENT PLAN, EVEN IN THE, IN LAST YEAR'S, UH, PROJECTION.
UM, THIS YEAR WHEN IT WAS UPDATED, WE KEPT THAT, UM, IT WENT, I BELIEVE IT WENT FROM LIKE 12 TO 15, AND THAT WAS DISCUSSED IN OUR SECOND BUDGET WORKSHOP WITH MARIN COUNCIL.
UM, AND WE WOULD RECOMMEND OF COURSE, STAYING ON THAT TRAJEC TRAJECTORY BECAUSE IT IS IMPERATIVE THAT WE CONTINUE TO ATTACK THIS UNFUNDED LIABILITY BALANCE.
AND CERTAINLY THE MORE YOU CAN PAY UPFRONT THE LESS OUR COSTS ARE AS WE MOVE THROUGH THE YEARS.
UM, WE, LIKE MATT SAID, WE'RE GOING TO GET OUR NEW ACTUARIAL REPORT IN DECEMBER.
UH, WE'LL COMPARE WITH WHAT THEY, WHAT THE BOARD ACTIONS WERE TO WHAT WE HAD PROJECTED.
UM, AND OF COURSE HAVE THOSE CONVERSATIONS AGAIN WITH MARIN COUNCIL AT OUR BUDGET WORKSHOPS.
AND, UM, THEN LOOK AT WHAT THE POTENTIAL PAYMENT MIGHT BE.
OVERPAYMENT MIGHT BE AS WE MOVE INTO THE PLANNING STAGE FOR 2122, IT WOULD BE AT THAT POINT, BUT THAT $15 MILLION PAYMENT WAS ESTABLISHED, UM, THROUGH OUR PROJECTIONS AND DISCUSSIONS WITH MIRA COUNCIL AT OUR SECOND BUDGET WORKSHOP.
I, I, TO SUPPORT THE OVERPAYMENT PHILOSOPHY, I JUST NEED TO KNOW HOW MUCH WE ARE OVERPAYING.
AND, UM, I WOULD LOOK HIM IN THE MORE THE MERRIER, BUT OKAY.
BUT OF COURSE WE DO NEED TO CHECK OUR FINANCIAL SITUATION AND I BELIEVE OUR STAFF WILL PUT IN, PUT IT INTO CONSIDERATION.
UM, I SUPPORT MAKING THE CONTRIBUTION.
I THINK AT SOME POINT IT HASN'T REALLY BEEN GOING DOWN.
IT SEEMS LIKE IT CONTINUES TO GO UP, BUT AT SOME POINT WE WILL TURN A CORNER I'VE BEEN ASSURED AND, UH, AND I WOULD SAY AT SOME POINT SOME OF THE NEWER HIRES WILL START TO HAVE AN IMPACT ON THAT TOO.
IS THAT PART OF THAT CHART? YES.
THAT IS A BIG PART OF THAT AS WELL.
IT'S ANOTHER COMPONENT TO THE PROJECTION IN THAT AS OUR WORKFORCE RETIRES AND NEW, UH, PUBLIC SAFETY PERSONNEL.
COME ON, UH, THEY'RE UNDER THE NEW, THE NEW RULES, THE NEW ARIZONA REVISED STATUTE RULES.
SO, UM, IT WILL BE A 50 50 SPLIT IN THE EMPLOYEE, EMPLOYER CONTRIBUTION, UNLIKE THE CURRENT PLAN, WHICH IS, UM, SIGNIFICANTLY PAID FOR BY THE EMPLOYER.
SO WE WILL WIN AND THE EMPLOYEES WILL WIN IN THE LONG RUN AND EVENTUALLY IT WILL BE DONE.
IS THERE A EMOTION? NO, WE'RE NOT MAKING A MOTION.
WE'RE JUST GIVING, JUST CHECK YOUR ACTION.
SO WE'VE BEEN WITH THE TIER THREE EMPLOYEES FOR, IS IT THREE OR FOUR YEARS NOW THAT UNDER THE POLICY THAT 16 OR 17, THAT TIER THREE CAME INTO EFFECT? UH, MAYOR, I CAN NOT RECALL HOW LONG IT'S BEEN.
I'M THINKING WE'RE GOING ON FOUR YEARS NOW, BUT I KNOW RAY JUST WALKED IN AND I DON'T WANT TO CATCH HER OFF GUARD HERE, BUT TIER THREE RAELYNN, DO YOU REMEMBER WHAT YEAR BY CHANCE? SHE'S LOOKING IT UP.
SHE'S LIKE, OKAY, IT'S A 50 50, BUT ALSO THEY WORK LONGER, RIGHT.
TWENTY-FIVE YEARS TO GET THE ENTIRE PENSION AS OPPOSED TO 20 AND THEN WHATEVER.
SO, SO WE'LL KEEP THEM LONGER.
THEY IT'LL BE A MORE EQUITABLE SPLIT.
AND I MEAN, THERE'S LOTS OF CHANGES THAT WILL IMPACT THAT.
HOPEFULLY SHOULD BRING THIS DOWN IN OUR FAVOR.
I, I, I TO SHARE, UH, COUNCIL MEMBER, ROW'S CONCERNED ABOUT THE MOVING GOALPOSTS, YOU KNOW, WE'VE, WE'RE CONCERNED ABOUT THAT IN THE
[00:50:01]
PAST, BUT IT SOUNDS LIKE WITH THE TOOL AND SOME OF THE THINGS I IMPLEMENTED AND YOU KNOW, THAT THEY MAY BE IMPLEMENTED, WE HAVE A BETTER, A BETTER FIDELITY ON WHAT'S GOING TO HAPPEN.SO I FEEL MORE COMFORTABLE WITH THAT.
AND, AND WHAT THAT, I GUESS THE OTHER QUESTION IS, UM, IF WE DON'T DO THIS NOW, I THINK YOU'VE POINTED OUT EARLIER AS A $35 MILLION, AGAIN, THE EXACT NUMBER YOU HAD UP THERE EARLIER, AND YOU CAN SHOW IT UP.
YOU WANT, BUT IF WE, IF WE JUST PUT THIS MONEY IN A BANK, WHAT ARE WE LOOKING AT 1.9% RATE OF RETURN ON WHAT'S BEEN THE AVERAGE WE'VE BEEN GETTING OVER THE YEAR, RIGHT? WHAT ARE WE LOOKING AT LESS THAN 2%? I MEAN, IF WE JUST PUT THIS IN OUR, IN OUR STOCKS OR BONDS OR ONE-TIME DOLLARS COUNCIL MEMBER, LANDO, OUR PERSONAL FOR THE CITY OF CHANDLER, BECAUSE WE'RE LIMITED ON HOW FAR OUT WE CAN INVEST.
WE'VE BEEN EARNING ON AVERAGE LESS THAN 2%, RIGHT? SO IF WE TAKE THIS MONEY, NOW WE COULD PUT IT IN OUR BOND OR ACCOUNTS AND GET 1.9% OR SOME RIDICULOUSLY LOW RATE, OR WE COULD TURN AROUND AND PUT THIS INTO A RATE WHERE WE'RE GOING TO GET ALMOST DOUBLE THE, THE INVESTMENT WE MADE ON IT.
AND THAT'S WHAT I SAW EARLY IN THAT CHART.
SO I'M OKAY WITH DOING IT, DOING IT IN JANUARY COUNSEL.
I'M GOOD WITH THIS TOO, BUT LET'S WORK OUR WAY DOWN HERE, VICE VICE-VERSA.
I, BECAUSE OF NOT KNOWING THE, THE OUTCOME OF, OF TOMORROW.
IT NOT KNOW IF WE'RE GOING TO GET A SECOND DIP.
UM, WE'VE GOT A LOT OF GOOD INDUSTRY THOUGH HERE THAT OUR STABILITY.
SO I DO HAVE RESERVATIONS AND MAKE THIS INVESTMENT.
HOWEVER, THEY, MY RESERVATIONS ARE OFFSET BY THE FINISHER RESPONSIBILITY THAT WE'VE HAD, THE CONTINGENCIES WE HAVE BUILT IN.
UM, AND THEN CONTINUE TO LOOK IN THE FUTURE EXPENSES.
UM, THAT PUTS ME A LITTLE MORE AT EASE.
I'M NOT ONE FOR WANTING TO GAMBLE WITH TAXPAYER MONEY, BUT, UM, TO THE PREVIOUS POINTS, I MEAN, THIS IS A DEBT WE GOT TO PAY EITHER WAY AND IT'S BETTER TO PAY IT OFF SOONER.
I JUST DON'T WANT TO BACK US INTO A CORNER.
SO THAT'S MY ONE RESERVATION, BUT I'M GOOD WITH THAT.
THE CONTRIBUTION CUSTOMER, REMEMBER CLIMATES MAYOR THE, UH, UM, I HAVE BEEN IN A CONTINUE TO BE FOR THE POSITION FINANCIAL POSITION TO CONTINUE TO THROW AS MUCH AS WE CAN AT THIS, TO RECTIFY THIS CHALLENGE ISSUE THAT WE DID NOT CREATE.
UM, CAUSE IT'S A PRUDENT THING TO DO SO.
YEAH, THE, UH, THERE'S, THERE'S NO QUESTION.
I WANT TO GET THIS ALBATROSS TO GO AWAY.
AND IT'S SOMETHING THAT'S GOING TO HANG OVER US FOR, FOR MANY YEARS AFTER THE REST OF US ARE GONE, THE FASTER WE CAN GET THAT TAKEN CARE OF THE BETTER.
I HAVE RESERVATIONS AS WELL ABOUT THE ECONOMY.
IF WE SEE ANOTHER DIP, UM, OR SOMETHING LIKE THAT, THAT COULD BE A TRAGIC, HERE'S THE DEAL.
THAT'S SITTING IN THE BANK AND REALITY THERE'S $9 MILLION LEFT.
IF THIS WERE TO, TO HIT US THE WAY WE COULD, UM, THAT $15 MILLION PAYMENT IN JANUARY, WHAT WE'RE GOING TO HAVE A LOT MORE INFORMATION WHEN THE ACTUARY REPORT COMES OUT IN DECEMBER, I'D LOVE TO CIRCLE BACK ON THIS, LIKE RIGHT NOW, LIKE YEAH.
LET'S MAYBE THINK ABOUT DOING IT, BUT I'D LIKE TO SEE THAT REPORT AND SEE WHAT'S HAPPENING WITH OUR ECONOMY.
WE CAN MAKE THE LAST WEEK TO SAY RIGHT COUNCIL TO, I THINK THE SO FAR SIX OF US HAD SAID, GO AHEAD AND DO IT.
SO WE CERTAINLY, WE CAN CIRCLE BACK AND LOOK AND SEE WHERE WE ARE.
AND THEN WE'LL ALSO HAVE, WE'LL BE REVISITING THIS AS PART OF NEXT YEAR'S BUDGET, BUT YOU BRING UP A VERY GOOD POINT.
WE DO HAVE THAT, UH, ADDITIONAL CARES MONEY THAT, UM, JUST FOR THE POSSIBILITY OF ANOTHER RESERVE FUND THAT COULD GO TOWARDS THIS IN CASE THE ECONOMY GOES IN A DIRECTION WE DON'T ANTICIPATE.
SO DON IN DECEMBER, WE'RE GOING TO GET AN ACTUARY REVIEW REPORT.
THAT'S GOING TO KIND OF GIVE US A LITTLE BIT BETTER UNDERSTANDING OF WHERE WE'RE AT ON THIS.
BUT AS THE MAYOR STATED, THAT WOULD BE UPDATING AND HAVING DISCUSSIONS ABOUT WHAT TO PAY IN THE UPCOMING YEAR, BUT YOU WILL SEE EXACTLY WHERE WE ARE IN OUR UNFUNDED LIABILITY AND OUR PROJECTIONS COMPARED TO WHAT ACTUALLY WAS DECIDED BY THE BOARD.
SO RAYLAND DID SOME GREAT INVESTIGATING OVER THERE.
UM, JULY 1ST OF 2017, ANYONE HIRED AFTER THAT DATE IS CONSIDERED IN TIER THREE AND THEN ALSO, UH, TO SOME OF THE COUNCIL CONVERSATION, JUST WANTING TO POINT OUT.
DEFINITELY WE WILL CONTINUE TO MONITOR OUR REVENUES AND EXPENSES THE NEXT COUPLE OF MONTHS.
AND, UH, IF SOMETHING WERE TO DIP, UH, THAT WILL DEFINITELY, UM, BRING US BACK TO YOU ALL, IF ALL THINGS STAY WELL.
UM, WHAT I'M HEARING IS, IS THAT YOU'RE OKAY WITH US MOVING FORWARD.
UM, CITY MANAGER, ANYTHING ELSE TO THIS WORK SESSION? UM, NO
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MINUTE.UM, THE NEXT UPDATE WE'D LIKE TO, UH, SEE IF YOU ARE AGREEABLE AND COUNSEL IS AGREEABLE TO COMBINING THAT WITH OUR NEXT, UM, BUDGET, OUR FIRST BUDGET WORKSHOP, WHICH WILL BE IN FEBRUARY.
SO FEBRUARY 8TH, IF WE CAN COMBINE THOSE TWO INTO ONE GROUP WORKSHOP, SO REALLY WOULD JUST BE DELAYING THIS.
AND, AND SO FAR THE TREND HAD SAID THAT WE'VE DONE THESE SET, THESE QUARTERLIES UP FOR THE PURPOSE OF BEING ABLE TO LOOK.
THIS WOULD MAYBE MOVE IT BACK A MONTH, IF NOT ACTUALLY RIGHT ON SCORE, PUT IT RIGHT ON TIME.
CONSTANTLY HEARING, SEEING HEADS.
NOW THAT'S BOB YOU'RE IN FAVOR OF COUNCIL MEMBER IN THE CLIMATE IS VERY GOOD.
WITH THAT COUNCIL, ANY SAYING NONE? WHY DON'T WE TAKE A, IT IS NOW FIVE 56 MEET AT SIX OH THREE, TAKE SEVEN MINUTES.