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GOOD[1. Call to Order]
EVENING, EVERYONE.IT IS NOW 6:00 PM IT IS MONDAY, AUGUST 14TH, 2023.
I'M GONNA CALL OUR SPECIAL MEETING TO ORDER.
I'M GONNA ASK OUR CITY SECRETARY TO GIVE US A ROLL CALL, PLEASE.
COUNCIL MEMBER NICOLE RAPHAEL.
COUNCIL MEMBER ANDRE BIRD HERE.
COUNCIL MEMBER DYNA MARKS HERE.
COUNCIL MEMBER CRYSTAL CHISHOLM HERE.
AT THIS TIME WE'LL HAVE THE FIRST ITEM
[2. Presentation and discussion of tax rate and debt issuance information related to the FY 2024 Proposed Budget]
ON OUR AGENDA.FIRST WE HAVE PRESENTATION AND DISCUSSION OF TAX RATE AND DEBT ISSUANCE INFORMATION RELATED TO THE FISCAL YEAR 2024, PROPOSED BUDGET.
MAKING THAT PRESENTATION IS LAKITA SUTTON, ASSISTANT FINANCE DIRECTOR.
OKAY, SO WE'RE GOING TO BEGIN OUR PRESENTATION TO JUST KINDA LOOK BACK AT, UH, WHERE WE'VE BEEN AS FAR AS WITH OUR TAX RATE, UM, SINCE WE'VE HAD OUR BUDGET WORKSHOP.
UH, OF COURSE, YOU KNOW, THE OFFICIAL TAX RATE NUMBERS HAVE COME IN.
UM, THE OFFICIAL ASSESSED VALUES HAVE COME IN AND WE HAVE OUR OFFICIAL CALCULATION, BUT IN WALKING BACK, UM, WHEN WE HAD THE BUDGET WORK WORKSHOP, WE PRESENTED AN MNO TAX RATE OF 0.54 AND A PROPOSED INS TAX RATE OF 0.14.
THAT WOULD HAVE GIVEN US 0.69 ON OUR TAX TOTAL TAX RATE, WHICH WOULD'VE BEEN THE SAME TAX RATE THAT WE CURRENTLY HAVE.
SO AN M AND O ON 0.54 AT THAT TIME WOULD'VE GIVEN US A REVENUE PROPERTY TAX REVENUE OF 38,447,500 AND AN INS REVENUE OF 9.9 MILLION.
UM, SO THAT, THAT IS WHAT OUR TOTAL, UM, TAX RATE WOULD'VE GIVEN US AT THAT TIME WHEN WE PRESENTED IT INITIALLY.
SO OF COURSE SINCE THEN, UM, WITH THE TAX RATE PROCESS, UH, THERE, THERE IS A PROCESS THAT WE GO THROUGH WHERE WE CALCULATE OUR CURRENT DEBT.
OUR DEBT PRETTY MUCH SETS THE TONE FOR EVERYTHING ELSE.
ONCE OUR TOTAL DEBT RATE IS CALCULATED, WE SUBMIT THAT IN THROUGH DALLAS COUNTY AND THEY COME UP WITH ESSENTIALLY WHAT OUR NO NEW REVENUE, NEW RATE, AND OUR VOTER APPROVAL RATES ARE GONNA BE FOR THE, FOR THE TAX YEAR.
SO THESE TWO RATES ARE VERY IMPORTANT.
SO IN PREVIOUS YEARS, THE CITY OF DESOTO APPROVED A TAX RATE UNDER THE VOTER APPROVAL RATE.
WHENEVER THAT HAPPENS, A CITY GETS SOMETHING CALLED AN UNUSED INCREMENT RATE THAT THEY'RE ABLE TO USE IN A FUTURE YEAR.
AFTER THE CALCULATION WAS COMPLETED FOR FISCAL YEAR 24, DALLAS COUNTY ADVISED THAT WE DID NOT HAVE, UH, WE HAD A $0 UNUSED INCREMENT, AND SO WE DID NOT GET TO UTILIZE AN UNUSED INCREMENT IN THE FISCAL YEAR 24 CALCULATION, WHICH CHANGES THINGS FOR US A LITTLE BIT.
SO WHEN WE TALK ABOUT SENATE BILL TWO, UH, WHAT SENATE BILL TWO IS MEANT TO DO IS TO ENSURE THAT CITIES ARE NOT OVER-INFLATING ANY PROPERTY TAX REVENUE.
THEY ESSENTIALLY ARE GONNA PUT A, A 3.5% CAP ON YOUR MNO AMOUNT.
AND OF COURSE, YOU KNOW, AS STATED, IN PREVIOUS YEARS, WE WERE ABLE TO USE AN UN UNUSED INCREMENTS TO FILL THE GAP BETWEEN, UM, THE VOTER APPROVAL RATE AND OUR ACTUAL TAX RATE.
BUT ONCE THE APPRAISALS WERE FINALIZED, UM, YOU KNOW, WE DIDN'T HAVE THAT THIS GO AROUND.
SO WE HAD A NO NEW REV NEW RATE OF 0.6 AND A VOTER APPROVAL RATE OF 0.68, WHICH MEANS THAT YOU DO NOT WANT TO EXCEED THE VOTER APPROVAL RATE OF 0.68.
SO IN PRETTY MUCH CONCENTRATING ON THE M AND O SIDE, UM, ESSENTIALLY WHAT WE'RE BRINGING TO YOU THIS EVENING IS GONNA GIVE US THE SAME AMOUNT OF TAX DOLLARS.
UM, OUR OVER NEW OVERALL REVENUE IS GONNA STAY ESSENTIALLY THE SAME.
I'M GONNA SHOW YOU HOW IT'S GONNA SHIFT JUST A LITTLE BIT.
UM, IT HAS NO IMPACT ON THE AMOUNT OF REVENUE OR TAXES PAID FROM, UH, THE PRIOR LEVELS THAT WE DISCUSSED.
SO WHAT WE'RE GOING TO DO TO MAKE EVERYTHING EVEN OUT INTO HAVE THE TAX RATE TO LOOK HOW WE WOULD, WHAT WOULD LIKE IT TO LOOK IS WE'RE GONNA TALK ABOUT A ONE YEAR TAX NOTE THAT THE CITY, UM, CAN INCUR AND IT'S A DEBT, UM, A NEW
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DEBT OF COURSE.UM, AND WE'LL EXPLAIN MORE ABOUT THAT IN A MINUTE, BUT LET'S AGAIN GO BACK TO THE REVENUE.
SO AGAIN, WHAT WE PRIOR COMMUNICATED WAS A TOTAL OF 4.8 MILLION IN TOTAL PROPERTY TAX REVENUE INTO THE GENERAL FUND.
AND THEN THIS NEW ONE IS ESSENTIALLY THE SAME, JUST A LITTLE BIT LESS.
YOU'LL NOTICE THAT THE MAJOR CHANGE HERE IS BETWEEN THE M AND O AND THE INS ON THE ORIGINAL TOWARDS THE NEW PROPOSED.
SO YOU'RE COMING UP WITH ABOUT A LITTLE BIT, YOU KNOW, 3.6 MILLION OR SO DIFFERENCE ON THE DEBT SERVICE SIDE.
SO WE'RE GOING FROM, FROM 9.9 MILLION TO 12.7 MILLION ON THE INS SIDE, WHICH ESSENTIALLY IS GONNA CAUSE US TO GO DOWN ON THE M AND O SIDE.
SO WE'RE BA ESSENTIALLY JUST SHIFTING THE REVENUE FROM ONE SIDE TO THE OTHER, WHERE WE HAVE THE FLEXIBILITY TO DO THAT.
WE DO HAVE THE FLEXIBILITY TO ADJUST.
INS CITIES DO HAVE THAT CAPABILITY.
WE DO NOT HAVE THE CAPABILITIES TO GO ABOVE THE 3.5% CAP ON THE M AND O SIDE.
SO THIS IS A TOOL THAT WE'RE GONNA BE TALKING ABOUT TONIGHT THAT DOES, UH, PRETTY MUCH ASSIST CITIES WITH TAX RATE MANAGEMENT AT THIS POINT.
SO WHAT ARE WE GONNA BE LOOKING AT? WE ARE, HOW, HOW ARE WE GOING TO SHIFT THAT DEBT? HOW ARE WE GONNA SHIFT THAT DEBT FROM 9 MILLION TO 12 MILLION? WELL, WE'RE TALKING ABOUT DOING A SHORT TERM DEBT ISSUANCE OF $3.4 MILLION.
IF WE ARE REDUCING THE AMOUNT OF EXPENDITURES IN OUR GENERAL FUND, WE WILL BE MOVING THOSE EXPENDITURES OUT OF THE GENERAL FUND AND MOVING THEM OVER TO CAPITAL FUND.
SO THE 3.4 MILLION, IF WE ARE INCREASING OUR DEBT RATE, RIGHT, WE'RE INCREASING OUR DEBT RATE FROM 0.14 TO 0.18, WE WOULD NEED TO SHIFT 3.4 MILLION OUT OF OUR GENERAL FUND INTO CAPITAL PROJECTS FUND.
SO THE 3.4 MILLION THAT WE WERE GOING TO SPEND IN THE GENERAL FUND, WE MOVE THAT THOSE EXPENDITURES OUT BECAUSE OUR M AND O HAS GOTTEN LOWER.
SO M AND O IS WHAT FUNDS THE GENERAL FUND.
SO WE WOULD MOVE, GO BACK HERE, SO WHERE THE M AND O WAS GONNA GENERATE 3.8 MILLION, NOW IT'S ONLY GONNA GENERATE 3.5 MILLION.
WELL, WE STILL HAVE TO FINANCE THAT 3.4 MILLION.
SO WE'RE GONNA PULL THOSE EXPENSES OUT OF THE GENERAL FUND AND MOVE THEM INTO THE CAPITAL PROJECTS FUND SO THAT WE CAN USE THE TAX NOTE TO FINANCE THOSE PARTICULAR EXPENSES.
WHAT A TAX NOTE DOES, A TAX NOTE IS AN OFFICIAL DEBT ISSUANCE.
AND SO THAT IS SOMETHING THAT WILL HAVE TO COME BACK TO THE CITY COUNCIL.
IF WE GO THIS ROUTE, WHICH IS WHAT WE'RE RECOMMENDING, UH, WE WOULD DEFINITELY NEED TO APPROVE THE TAX RATE BEFORE WE, UH, APPROVE THE DEBTS.
I'M SORRY, BEFORE WE APPROVE THE TAX RATE IN THE BUDGET.
SO, WHICH IS WHY WE'RE BRINGING THIS TO YOU THIS EVENING FOR FUTURE CONSIDERATION, BECAUSE I KNOW YOU'RE PROBABLY WONDERING WHAT DOES THIS MEAN, YOU KNOW, FOR FUTURE, UM, WHAT SENATE BILL DOES TOO, UH, SENATE BILL TWO DOES AGAIN, IS IT PUTS THOSE RESTRICTIONS ON US.
ON THE ML SIDE, THERE'S NOT MUCH WE CAN DO ABOUT THAT.
THE ONLY THING YOU CAN DO IS USE TAX RATE INCREMENT OR YOU CAN, UM, USE A TOOL LIKE WHAT WE'RE INTRODUCING TONIGHT, SOME TYPE OF SHORT TERM DEBT TO RAISE YOUR DEBT RATE AND MAKE IT EVEN OUT THE WAY THAT YOU NEED TO.
SO WHAT WE NEED TO DO IS MAINTAIN OUR M AND O RATE OVER THE NEXT SEVERAL YEARS.
WE DON'T WANT SEE OUR M AND O RATE DECREASE, RIGHT? BECAUSE OUR EXPENDITURES IN THE GENERAL FUND ARE NOT GOING TO DECREASE OUR EXPENDITURES IN THE GENERAL FUND ARE GOING TO, UM, VERY NATURALLY INCREASE ON THEIR OWN SIMPLY DUE TO PERSONNEL, YOU KNOW, AND SO WE DEFINITELY DON'T WANT TO SEE THE M AND O RATE DECREASE.
WE DEFINITELY NEED TO SUSTAIN THAT.
WHAT THAT MEANS ALSO IS THAT ADDING NEW SERVICES IN THE FUTURE MAY BE LIMITED.
UM, CITIES ARE NOW COMING TO THE POINT WHERE, YOU KNOW, SENATE BILL TWO WAS RELEASED THREE YEARS AGO, AND WE'RE KIND OF COMING TO THE POINT NOW TO WHERE, UH, WE WE HAVE TO BE, UH, MORE CREATIVE AND USE THESE TYPE OF TAX
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RATE MANAGEMENT TOOLS TO HELP US STAY WHERE WE NEED TO BE AND, AND KEEP OUR M AND O RATE WHERE IT NEEDS TO BE.UM, AT SOME POINT THOSE SERVICES WILL BE LIMITED SIMPLY BECAUSE OF THE CAP AS ASSESSED VALUES INCREASE, THE M AND O IS GOING TO DECREASE, AND WE HAVE TO DO SOMETHING TO SUSTAIN THAT.
MM-HMM,
SO BRANDON, DO YOU WANNA ELABORATE ON THAT? SURE.
SO, SO THE TYPES OF THINGS THAT OTHER CITIES ARE RUNNING INTO ISSUES, UM, THAT WE HAVE NOT YET, UM, BUT OTHERS, UM, ON THAT.
SO LET'S SAY THAT FOR EXAMPLE, THEY WANT TO ADD A FIREHOUSE.
UM, AND THAT RE REQUIRES PUTTING INTO PLAY NINE TO 12 NEW FIREFIGHTERS EQUIPMENT AND ALL THOSE DIFFERENT THINGS, RIGHT? ADDING A SERVICE LEVEL LIKE THAT WITHIN A THREE, THREE AND A HALF PERCENT GROWTH CAP EVERY YEAR JUST SIMPLY DOESN'T WORK BECAUSE YOUR PERSONNEL COSTS ARE GONNA TAKE OUT THE MAJORITY OF THAT AMOUNT.
AND SO YOU WANT TO ADD A NEW LEVEL OF SERVICE THAT MIGHT BE SEVERAL MILLIONS DOLLARS IN ONE YEAR, THEN YOU LIKELY ARE GOING TO HAVE TO GO TO VOTERS TO GET THE APPROVAL FOR WHATEVER NEW LINE OF SERVICE YOU'RE OPENING UP ON THAT.
SO THAT'S KIND OF, SO, SO THINGS LIKE THAT, IT COULD BE PAY RAISES FOR EMPLOYEES.
SOME OTHER CITIES HAVE DONE THAT AS WELL, RIGHT? SO THEY PUT UP TO VOTERS PAY RAISES FOR EMPLOYEES BECAUSE IT WAS GONNA BE, YOU KNOW, 10%, 20%, UM, FOR THAT.
AND, AND THAT'S OBVIOUSLY ABOVE THE 3.5%, UM, AMOUNT.
SO THAT'S, THAT'S THE TYPE OF THING.
SO ANY, ANYTIME THAT YOU WANT TO CHANGE ABOVE KIND OF STATUS QUO OF WHAT YOU HAVE, UM, THERE'S GONNA HAVE TO BE A VERY SERIOUS CONVERSATION ABOUT WHETHER OR NOT THAT'S SOMETHING THAT YOU'RE GOING TO WANT TO TAKE TO VOTERS TO HAVE THEM APPROVE.
UM, AND THAT'S THE WHOLE POINT OF SENATE BILL TOO, IS TO, IF YOU GO ABOVE THAT THREE POINT A HALF PERCENT WAS TO THEN YOU HAVE TO GET THE APPROVAL OF THE VOTERS TO BE ABLE TO DO SOMETHING LIKE THAT ON IT.
AND SO FOR A, A CITY, IT'S, WHERE IT'S DIFFICULT IS WHERE A CITY LIKE OURS, RIGHT, WE'RE GROWING, BUT WE'RE NOT LIKE A BOOM CITY, RIGHT? WE DIDN'T JUST START OUT, YOU KNOW, SO WE'RE, WE'RE GROWING EVERY YEAR AND SO WE HAVE, WE CONTINUE TO NEED NEW SERVICE LEVELS, BUT THE GROWTH ISN'T NECESSARILY THERE OF, YOU KNOW, OF HAVING A TOWN THAT'S DOUBLING EVERY COUPLE OF YEARS AND ITS SIZE, UM, FOR THAT.
AND SO WE'RE, WE'RE GOING TO BE CONSTRAINED BY THE LIMITS OF 3.5% PLUS WHATEVER OUR NEW GROWTH IS, UM, AND TRYING TO FIND ROOM IN THERE TO BE ABLE TO ADD NEW LEVELS OF SERVICE.
SO YEAH, AGAIN, IT'S JUST TAKING US BACK TO THE IDEA OF KEEPING IN MIND THAT WE WANNA SUSTAIN OUR M AND O RATE.
WE DEFINITELY DO NOT NEED THAT TO DECREASE ONE CONSIDERATION OR A TOOL.
ANOTHER TOOL THAT WE MAY, UM, WANT TO UTILIZE IN THE FUTURE IS, UH, WE KNOW THAT WE CURRENTLY HAVE A SALES TAX.
UM, YOU KNOW, WE HAVE SOMETHING IN PLACE RIGHT NOW TO WHERE THERE'S A 0.5% SALES TAX DEDICATED TO PROPERTY TAX REDUCTION.
AND BECAUSE WE HAVE THAT IN PLACE, IT DOES AFFECT OUR CALCULATION AND IT DOES AFFECT OUR, UM, NO NEW REVENUE RATE, UM, OUR VOTER APPROVAL RATE.
SO, YOU KNOW, IF WE WANNA DO SOMETHING SUCH AS BRINGING THAT BACK TO THE PUBLIC, PUTTING THAT ON THE BALLOT IN MAY AND MAYBE SHIFTING IT, NOT SO MUCH OF TAKING THE TAX TOTALLY AWAY, BUT TAKING IT AWAY IN A SENSE THAT IT'S NOT HURTING US ON THE TAX RATE CALCULATION AND THEN MAKING SOME TYPE OF NEW PURPOSE FOR IT, SUCH AS SOMETHING TO SUPPORT PUBLIC SAFETY.
AND THAT WILL GIVE US THE 0.5% BACK AND HELP US MAINTAIN THAT M AND O RATE.
SO AGAIN, THAT'S JUST, EXCUSE ME, SU COUNCIL MEMBER.
PARKER, DID YOU HAVE A QUESTION? I DID.
I JUST WANTED TO KNOW, IS THAT ENOUGH THOUGH? IF YOU WERE ONLY TO DO THAT, ARE YOU SAYING THAT'S ONE OF THE TOOLS? YEAH.
IN ADDITION TO SOMETHING ELSE, NOT BY ITSELF.
WELL, THE 0.5 IS DEFINITELY GONNA BE A CONSIDERATION AND THAT PERCENTAGE WE CAN'T CHANGE BECAUSE THAT'S WHAT'S CURRENTLY IN PLACE.
AND THEN THE OTHER CONSIDERATION IS WHAT WE'RE GONNA DISCUSS IN JUST A LITTLE BIT MORE ABOUT THE, UM, ABOUT THE TAX NOTE.
I MEAN, BUT IS THAT IN ADDITION TO THE, WHAT WE TALKED ABOUT A FEW MINUTES AGO WHERE YOU MOVED THE MONEY FROM MO TO INS? SO THE TAX NOTE ALL KIND OF COINCIDES WITH THAT.
SO THE TAX NOTE COINCIDES WITH SHIFTING THE MO AND THE INS.
SO, AND THAT WOULD BE, AND THAT WOULD BE SOMETHING THAT WE WOULD DO THIS FISCAL UPCOMING FISCAL YEAR IN 2024, UH, THIS ONE BECAUSE WE CAN'T VOTE ON IT UNTIL, UH, UNTIL AFTER THIS 2024 FISCAL YEAR STARTS, THE NEXT FISCAL YEAR STARTS, IT'S REALLY A CONSIDERATION FOR FISCAL YEAR 2025.
SO IT'S A YEAR AHEAD OF US THAT WE'RE KIND OF LOOKING AHEAD AND TRYING TO FIGURE OUT WHAT IS THE NEXT TOOL THAT WE CAN USE, UM, TO HELP MAINTAIN AS MUCH M AND O TAX RATE AS POSSIBLE GOING INTO THAT YEAR.
FOR FUTURE YEARS, BECAUSE OF THE TIMING OF THE ELECTIONS AND EVERYTHING, UM, IF WE DID WANNA CONSIDER SOMETHING LIKE THIS, IT WOULDN'T GO ON THE BALLOT UNTIL
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MAY OF 2024.SO AGAIN, THIS JUST KIND OF RECAPS WHAT THAT 0.5, UH, WHAT THAT 5 CENT IS.
UM, WHAT IT DOES IS IT DOES AFFECT OUR, UM, YOU KNOW, OUR TAX LEVY, ESSENTIALLY IT DOES.
AND, UM, WE COULD MOVE THE PURPOSE OF THAT SALES TAX, YOU KNOW, OUT OF THAT CALCULATION AND PUT IT TO A DIFFERENT, UH, PURPOSE.
AND ALSO FOR FUTURE CONSIDERATION, AS MENTIONED BEFORE, IT MAY BE NECESSARY IN FUTURE YEARS TO HAVE VOTER ELECTIONS TO PROVIDE ADDITIONAL TAX RATE AUTHORITY TO ADD NEW SERVICES OR PERSONNEL.
JUST AS BRANDON, UM, EXPLAINED, YOU KNOW, ADDING THOSE NEW PROGRAMS, AT SOME POINT IT'LL GET TO THE, YOU KNOW, TO THAT TIME WHERE WE'LL SAY, OKAY, WE NEED TO ASK THE VOTERS IF THEY WANNA SUSTAIN THAT WITH AN INCREASED TAX RATE COUNCIL MEMBER, BUR THANK YOU MADAM MAYOR.
UH, BUT IF WE WERE TO HAVE TO DO THAT, THAT WOULD ONLY, UH, WE WOULD NOT HAVE TO DO THIS MANEUVER NOW, CORRECT.
THIS LOAN, THIS MOVEMENT FROM THE M AND O TO THE INS.
SO THE MOVEMENT FROM THE M AND O TO AN INS IS, UH, IS GONNA BE NECESSARY FOR THIS CURRENT, FOR THIS CURRENT YEAR.
UM, YEAH, YOU COULD, SORRY, UH, YOU COULD BALANCE IT ALL BACK OUT.
YOU, YOU COULD KIND OF RIGHT SIZE, UH, HOWEVER YOU NEEDED THAT.
SO YOU DIDN'T HAVE TO DO NECESSARILY A SHORT TERM ISSUANCE THAT ISSUANCE IN ORDER TO MAINTAIN AN INS IF YOU HAD THE AUTHORITY ON YOUR M AND O RATE.
UH, SO THE ANSWER IS YES TO THAT.
WELL, AT THIS TIME WE WILL BE AVAILABLE TO ANSWER ANY QUESTIONS THAT YOU WOULD HAVE, BUT I, IF YOU DON'T MIND, I WOULD LIKE TO GO AHEAD AND BRING UP OUR, UM, OUR PARTNER, UM, JORGE DELGADO WITH HILLTOP HILLTOP SECURITIES.
WHAT HE'S GONNA DO IS JUST GO AHEAD AND, UH, RECAP SENATE BILL TO, AND EXPLAIN, YOU KNOW, HOW THAT HAS AFFECTED THE CITIES AND HOW PARTICULAR IT'S AFFECTING US FOR THIS YEAR'S TAX RATE.
AND HE'S GONNA GO AHEAD AND ALSO PROVIDE AN OVERVIEW, UM, AND THE STRATEGY FOR THE TAX NOTE.
AND, AND REAL QUICK, UH, CAN WE GO BACK ONE SLIDE REAL FAST JUST BEFORE WE JUMP INTO MR. DELGADO'S, UM, PROPORTION OF IT, UH, UH, THIS PART HERE, REMEMBERING THAT, THAT LAST PART, THE FUTURE YEARS TO HAVE VOTER ELECTIONS TO PROVIDE ADDITIONAL TAX RATE AUTHORITY, IN MANY INSTANCES THAT MAY STILL RE RESULT IN A LOWERING OF OUR TAX RATE, RIGHT? REALIZING THAT, THAT BECAUSE WE HAVE, WE'RE IN AN AREA WHERE ASSESSED VALUES GROW SO HIGH, RIGHT? OFTENTIMES YOU COULD STILL NEED VOTER APPROVAL TO EVEN HAVE A DECREASING TAX RATES, JUST NOT AS MUCH OF A DECREASE, UM, FOR THAT.
SO JUST KIND OF KEEP THAT IN THE BACK OF YOUR MINDS THAT, THAT WHEN YOU'RE ASKING FOR DIFFERENT VOTER APPROVALS TO GO ABOVE THE 3.5% CAP, AND IT ISN'T NECESSARILY TIED TO AN INCREASING TAX RATE FOR US, IT COULD BE IN FACT A DECREASING TAX RATE OR MAINTAINING THE SAME TAX RATE, UM, QUESTION THAT YOU'RE ASKING VOTERS TO CONSIDER.
UM, UM, MR. WRIGHT, CAN I ASK A QUESTION? SO, IN EFFECT, WHAT SENATE BILL TWO HAS DONE IS, UH, THE M AND O IS KINDA SET, BUT THE CITIES WHO ARE TRYING TO GROW, YOU HAVE TO TAKE ON DEBT TO DO SUCH.
SO AS LONG AS WE ARE TAKING ON DEBT, WE CAN KEEP THE RATE PRETTY BALANCED BECAUSE THE INS IS WHERE WE CAN REALLY, UH, WHERE WE CAN, UM, UH, UH, BALANCE IT OUT, RIGHT? SO AS LONG AS WE ARE NOT FUNDING IT THROUGH THE TAX REVENUES AND WE'RE DOING IT VIA DEBT, AND IN ESSENCE, THAT'S WHAT WE'RE DOING TODAY.
AND, AND, AND THAT IS CORRECT.
AT SOME POINT THOUGH, YOU RUN OUT OF ELIGIBLE ITEMS FOR DEBT.
OKAY? AND SO THEN YOU ARE THEN, THEN AT THAT POINT YOU HIT THE WALL OF, NOW YOU HAVE TO EITHER ASK VOTERS FOR ADDITIONAL, UM, RATE ON THE M AND O SIDE, RIGHT? OR YOU HAVE TO REDUCE YOUR LEVEL OF SERVICES TO BE ABLE TO, TO, TO MAINTAIN YOUR SERVICE LEVEL.
BECAUSE I THINK WE'RE ALL IN FAVOR OF LOWING, LOWING, UM, LOANING TAX LEWING TAXES.
HOWEVER, WE DON'T WANT TO LOWER TOO LOW CORRECT.
THAT WE GET TO A POINT WHERE WE CANNOT PROVIDE EXACTLY A LEVEL OF SERVICE EXACTLY.
SO THAT OUR, THOSE CITIZENS WHO ARE LISTENING, THAT IS WHAT THE CONVERSATION IS REALLY ABOUT.
HOW DO WE KEEP IT? BECAUSE IF WE HAD TO, UH, BECAUSE OF THE LIMITATION FOR SENATE BILL TWO, WE'RE HAVING TO DO THE SPECIAL MANEUVER.
AND THAT WAS GONNA BE MY COMMENTS.
I KNOW WHEN WE HEAR IN RESIDENTS HERE LOWER THE TAX RATE, IT ALWAYS EVOKES A HAPPY FEELING.
BUT, UM, THERE MAY BE SOME, THERE ARE CONSEQUENCES WITH THAT AS WELL THAT WE WANT THE PUBLIC TO DEFINITELY HAVE.
AND I'VE EVEN ASKED CITY MANAGER, RIGHT? ABOUT POSSIBLY EXPANDING THIS CONVERSATION, UH, BROADLY, UH, FOR THE COMMUNITY.
SO CONSIDERING THAT IT WILL HAVE IMPACTS IN YEARS TO COME, UM, WITH, WITH WHAT WE'RE HAVING TO DO OR POSSIBLY HAVING TO DO WITH MANEUVERING
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IT TO KEEP THE TAX RATE BALANCED.AND SO I'VE EVEN ASKED HIM ABOUT HAVING SOME BROADER DISCUSSIONS, TOWN HALL, SO THAT THE COMMUNITY CAN UNDERSTAND, YES, WE WANT A LOW TAX RATE, BUT AT WHAT COST, YOU KNOW? YES.
AND SO WE HAVE TO MAKE SURE THAT WE ARE CONSIDERING HOW THAT COULD POSSIBLY IMPACT THE SERVICES THAT THEY'VE GROWN TO KNOW AND LOVE.
SO, AND THEN, UM, JORGE IS GOING TO JUST RECAP ALSO FOR THE PUBLIC, BECAUSE I KNOW EVERYBODY'S HEARD ABOUT SENATE BILL TOO AND WHEN IT WAS RELEASED AND, UM, KINDA WHAT THE EFFECT IT WOULD HAVE ON THE CITIES AND, YOU KNOW, CITIES COME TO THAT WALL THAT BRANDON TALKED ABOUT AT SOME ONE POINT IN, YOU KNOW, OR ANOTHER.
SO WE'RE GONNA KIND OF DO A HIGH LEVEL OVERVIEW OF THAT.
UH, JORGE DELGADO, HILLTOP, SECUR, PART OF THE TEAM REPRESENTS DESOTO AS YOUR FINANCIAL ADVISOR.
UM, I WORK WITH JIM BONUSES AND ANDREA, WHO YOU'VE, UH, MADE OVER THE YEARS.
HAPPY TO BE HERE TODAY AND, AND WALK YOU THROUGH THIS PLAN OF FINANCE.
WE'RE GONNA CALL YOU A DRAFT PLAN OF FINANCE.
UH, SO AN INTRODUCTION OF THIS TOPIC TO YOU.
UH, WE WOULD BRING IT BACK AS A FINAL DURING YOUR REGULAR SESSION ON THE FIFTH, UH, AT WHICH POINT YOU DIRECT US TO MOVE FORWARD OR NOT.
UH, NO, THAT, NOT A FINAL ACTION AT THE TIME EITHER, BUT, UH, WE WANTED TO, YOU KNOW, BRING IT UP FIRST AND THEN, UH, YOU TAKE, UH, FORMAL ACTION LATER.
SO, UH, THIS IS A PLAN OF FINANCE FOR THE CITY OF DESOTA TO ISSUE, UH, A TAX NOTE, A TAX NOTE TO FUND, UH, VEHICLES AND EQUIPMENT, EQUIPMENT REPLACEMENT.
UH, BUT THE CITY OF DESOTA HASN'T ISSUED A TAX NOTE, UH, SINCE 1995.
SO I WANTED TO KIND OF GIVE YOU AN OVERVIEW OF WHAT A TAX NOTE IS, WHAT A TAX NOTE DOES, AND HOW THAT DIFFERS TO WHAT THE SOTA HAS DONE IN THE PAST.
IN THE PAST, YOU'VE DONE CERTIFICATES OF OBLIGATION AND GENERAL OBLIGATION BONDS.
A TAX NOTE IS A DEAD INSTRUMENT THAT IS COMMONLY USED BY TEXAS CITIES TO FUND CAPITAL NEEDS, SUCH AS VEHICLES AND EQUIPMENT REPLACEMENT, STREETS AND ROADS, UTILITY IMPROVEMENTS, RENOVATIONS, FACILITY IMPROVEMENTS, AND SO ON.
DURING, WE PULLED SOME DATA TO SHOW YOU HOW THESE HAVE BEEN USED ACROSS THE STATES DURING FISCAL, DURING CALENDAR YEAR 20 23, 21.
TAX NOTES HAVE BEEN ISSUED BY THE, BY TEXAS CITIES ACROSS THE STATE.
UH, WE'RE ACTUALLY WORKING ON TWO THAT WILL BE ISSUED, UH, THIS WEEK, SO 23 THIS YEAR SO FAR, AND I'M SURE THERE, THERE WILL BE OTHERS IN THE FUTURE.
LAST CALENDAR YEAR, 44, TEXAS CITIES UTILIZE THE DEBT INSTRUMENTS, UH, AS PART OF THEIR BUDGET CYCLE.
UH, A TAX NOTE IS JUST LIKE A CERTIFICATE OF OBLIGATION AND A GENERAL OBLIGATION BOND IN THAT YOU CAN LEVY A DEBT SERVICE TAX RATE TO REPAY IT.
SO YOU WOULD BE REPAYING THIS TAX NOTE WITH YOUR DEBT SERVICE TAX REVENUES.
NOW, BIG DIFFERENCE BETWEEN A TAX NOTE AND YOUR OTHER DEBT INSTRUMENTS IS THAT YOU HAVE A SEVEN YEAR MAXIMUM MATURITY CERTIFICATES OF OBLIGATION, GENERAL OBLIGATION BONDS CAN GO AT 40 YEARS.
NOW, WE WOULD NEVER FINANCE SOMETHING OVER THE USEFUL LIFE, BUT DESOTO TYPICALLY HAS DONE 20 YEAR FINANCINGS WITH THEIR CERTIFICATES, AND A TAX NOTE IS LIMITED TO SEVEN YEARS.
ANOTHER KEY DIFFERENCE IS THAT A TAX NOTE DOES NOT, I'M SORRY, COULD YOU REPEAT THAT? UH, TYPICALLY THE CITY OF DESOTO HAS DONE CERTIFICATES OF OBLIGATION AND GENERAL OBLIGATION BONDS FOR A 20 YEAR MATURITY, BIG PROJECTS.
AND, UM, AND THAT'S USUALLY WHAT WE SEE WITH TEXAS CITY'S 20 TO 25 YEARS FOR REF FINANCING A TAX NOTE.
YOU'RE LIMITED TO SEVEN YEARS ON THAT.
UH, ANOTHER DIFFERENCE, KEY DIFFERENCE BETWEEN A TAX NOTE AND THOSE ARE DEBT INSTRUMENTS, IS THAT A TAX NOTE DOES NOT REQUIRE VOTER APPROVAL OR A NOTICE.
IT'S SIMPLY A MATTER OF COUNSEL, UH, ACTION AND APPROVAL OF AN ORDINANCE.
BUT AS A MATTER OF BEST PRACTICE, WE WANTED TO BRING YOU A PLAN OF FINANCE DURING A REGULAR SESSION SO THAT YOU DISCUSS IT DURING YOUR CITY COUNCIL MEETING, UH, AND THEN TAKE ACTION LATER ON.
UM, AGAIN, JUST AN APPROVAL OF AN ORDINANCE TO ENTER INTO A TAX NOTE AND IT'S A DEAD INSTRUMENT.
SO, A LITTLE BIT MORE BACK HERE ON SENATE BILL TWO AND THE KETO COVERED IT VERY WELL, UH, IN 2019, SENATE BILL TWO WAS PASSED, AND WHAT THAT DID WAS IT IMPOSED CERTAIN LIMITS ON THE CITY'S ABILITY TO LEVY AN AOR TAX RATE, WHICH IS YOUR PROPERTY TAX RATE.
THE MAIN, UM, EFFECT OF THE SENATE BILL IS THAT IT CAPPED CITIES AT 3.5% INCREASE ON YOUR, UM, MAINTENANCE AND OPERATIONS PORTION OF YOUR TAX RATE.
SO A CITY COULD NOT GO OVER 3.5% INCREASE IN REVENUES AS COMPARED TO LAST YEAR WITHOUT TRIGGERING A ROLLBACK ELECTION.
IT USED TO BE 8%, SO IT WAS REDUCED TO 3.5%.
UH, AS A MATTER OF SENATE, A BILL TO YOUR DEBT SERVICE PORTION OF YOUR TAX RATE IS NOT SUBJECT TO, UH, ROLLBACK OR TO THESE LIMITATIONS.
SO, UH, THAT YOU HAVE THE ABILITY TO LIVE YOUR DEBT SERVICE PORTION OF YOUR TAX RATE, SUCH THAT IT'S SUFFICIENT TO PAY FOR YOUR DEBT OBLIGATIONS, EVEN IF IT'S ABOVE 3.5%.
WHENEVER CITIES LIKE SODA EXPERIENCE HIGH GROWTH, YOU GREW 15%, UM, THIS YEAR AS COMPARED TO LAST YEAR, YOU'RE GOING TO SEE ALL ELSE SEQUEL,
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A REDUCTION IN YOUR PROPERTY TAX, JUST LIKE LAKITA MENTIONED, UH, THESE LEG, THESE LEGISLATIVE CAPS ON YOUR M AND O OPERATING SIDE OF YOUR TAX RATE COULD REDUCE YOUR CAPACITY TO PAY FOR TYPICAL CAPITAL NEEDS THAT YOU WOULD PAY FOR CASH PAY AS YOU GO, LIKE VEHICLE LEASES, EQUIPMENT, STREETS, THINGS THAT YOU WOULD'VE PAID FOR ON YOUR OPERATING SIDE.THE CAPACITY TO DO THAT COULD BE DIMINISHED BECAUSE OF THIS CAP.
SO WHAT A LOT OF TEXAS COMMUNITIES ARE DOING IS THAT THEY'RE USING A TAX NOTE AS A DEAD INSTRUMENT TO COVER THESE ITEMS AND FREE UP SOME OF THAT REVENUE STREAM ON YOUR OPERATING SIDE AND YOUR OPERATING EXPENSES FOR NEXT BUDGET CYCLE.
AGAIN, TAX NOTES ALLOW FOR FUNDING OF THAT TYPE OF CAPITAL NEEDS.
AND WHAT WE'RE LOOKING AT HERE IS VEHICLES AND EQUIPMENT REPLACEMENT.
AND ONE MORE ITEM TO, TO NOTE.
A TAX NOTE DOES ALLOW A CITY TO MANAGE ITS TAX RATE AND, UH, TACKLE A MORE PREDICTABLE CAPITAL IMPROVEMENT PROGRAM, UH, YEAR, YEAR OVER YEAR.
UM, AND, AND IT ALLOWS FOR, YOU DON'T HAVE THAT MUCH FLUCTUATION IN IN YOUR TOTAL TAX RATE IF, IF YOU USE THIS TYPE OF, THIS TYPE OF TAX RATE MANAGEMENT STRATEGY.
SO THE MECHANICS OF THIS PLAN FINANCE, UH, AND I'LL WALK YOU THROUGH THOSE AND I'LL, ANYTIME YOU HAVE A QUESTION, PLEASE STOP ME, I'LL HAPPY TO ANSWER THOSE.
THE CITY OF DESO IS LOOKING AT FUNDING, UH, VEHICLES AND EQUIPMENT REPLACEMENT FOR A TOTAL OF 3.4 MILLION WITH A ONE YEAR TAX NOTE.
THIS ALIGNS WITH YOUR FISCAL YEAR 2024 TAX RATE THAT YOU'RE DISCUSSING RIGHT NOW, AND YOUR PROPOSED DEBT SERVICE TAX RATE OF 1 8 6, YOU'VE GROWN 50% AND THAT ALLOWS YOU TO ABSORB $3.5 MILLION OVER ONE YEAR.
AGAIN, A TAX NOTE CAN GO OUT SEVEN YEARS, BUT RIGHT NOW WE'RE ONLY LOOKING AT ONE YEAR, UH, FUNDING THE IDEA TO ALSO MAINTAIN FUNDING CAPACITY FOR YOUR CAPITAL IMPROVEMENT PROGRAM THAT YOU ALREADY HAVE IN PLACE.
SO THIS ONE YEAR TAX NOTE WOULD NOT IMPACT YOUR ABILITY TO CONTINUE TO TACKLE THAT, UH, MULTI-YEAR CAPITAL IMPROVEMENT PROGRAM THAT YOU'VE BEEN, UH, FUNDING YEAR AFTER YEAR, RIGHT? YOU WOULD PAY IT OFF IN FISCAL YEAR 2024.
YOUR CAPITAL IMPROVEMENT PROGRAM CONTINUES TO, YOU CONTINUE TO HAVE FLEXIBILITY TO DO THAT, AND WE'VE RAN THOSE NUMBERS BACK IN MARCH FOR NIKITA AND TRACY.
UH, AND THAT CAPITAL IMPROVEMENT PROGRAM IS SOMETHING YOU CAN ABSORB, UH, EVEN TAKING INTO ACCOUNT THIS TAX NOTE RIGHT NOW.
AGAIN, REPAYMENT SOURCE IS YOUR DEBT SERVICE TAX RATES.
WE'RE BUDGETING 5.5%, WHICH IS, UH, CONSERVATIVE.
UH, WE JUST GOT A BID TODAY FOR A TAX AND THAT WE'RE SELLING TOMORROW.
VERY SIMILAR STRUCTURE TO THE SOTOS, AND THAT GOT A 5% BID.
COULD YOU REPEAT THAT? I'M SORRY.
WE'RE, WE'RE BUDGETING A 5.5% INTEREST RATE FOR BUDGETING PURPOSE FOR CONSERVATIVE AND BUDGETING PURPOSES AS WE WORK WITH THE NUMBERS WITH, WITH YOUR FINANCE STAFF.
THAT IS NOT AN INTEREST RATE WE EXPECT TO GET, BUT WE WANNA MAKE SURE WE, WE BUDGET ACCORDINGLY AND THEN COME DOWN AS, AS WE GET THE BIDS.
UH, IF YOU MOVE FORWARD WITH THE TAX NOTE, WE TOOK A BID TODAY FOR A VERY SIMILAR STRUCTURE TO WHAT THIS TAX NOTE IS, AND WE GOT A 5% BID.
UH, BUT SHORT TERM RATES ARE MOVING ANY FED ACTION INFLATION.
SHORT TERM RATES ARE VERY VOLATILE RIGHT NOW.
SO WE WANNA MAKE SURE WE BUDGET ACCORDINGLY, BUT I THINK WE SHOULD LAND UNDER THE 5.5%.
THIS WILL NOT BE YOUR TYPICAL BOND SALE THAT YOU HAVE SEEN IN THE PAST.
WE WILL NOT GET A RATING, WE WILL NOT PUT IT TOGETHER AN OFFERING DOCUMENT, BUT WE'LL GO THROUGH A COMPETITIVE PRIVATE PLACEMENT PROCESS, WHICH IS WE WILL BID IT OUT TO FINANCIAL INSTITUTIONS, WHICH IS A FANCY WORD FOR BANKS.
BANKS WILL BE BIDDING ON THIS, RIGHT? WE'LL PUT IT OUT.
WE'LL SAY WE HAVE THE CITY OF DESOTO ISSUED AN TAX NOTE.
THEY'RE DOUBLE EIGHT RATED, WHICH ARE VERY HIGH INVESTMENT GRADE RATING.
AS YOU MAY ALREADY KNOW, THERE CONTINUES TO BE A LOT OF APPETITE FOR HIGHLY RATED TEXAS PAPERS, SUCH AS THE CITY OF DESOTO.
WE SUSPECT COMPETITION IN THIS SPACE.
UH, WE WILL TAKE BIDS AND IT WILL PRESENT A BID TO YOU, A TAX EXEMPT FIXED INTEREST RATES, UH, DURING YOUR SEPTEMBER 16TH MEETING.
AGAIN, YOU HAVEN'T DONE THIS IN THE PAST WHERE IT'S VERY COMMON FOR A ONE YEAR THAT INSTRUMENT TO BE ISSUED AS A PRIVATE PLACEMENT, AND IT LOWERS YOUR FINANCING COSTS.
WE DON'T HAVE TO PAY FOR A RATING, WE DON'T HAVE TO PAY FOR AN UNDERWRITER'S DISCOUNT.
UH, WE DON'T HAVE TO PUT TOGETHER AN OFFERING DOCUMENT, WHICH IS A SUBSTANTIAL, UM, AMOUNT OF TIME FOR STAFF OR CITY STAFF TO, TO TAKE A PART OF THAT ROLE.
UH, AND IT'S A VERY EFFICIENT PROCESS THAT WE HAVE SEEN AND UTILIZED IN THE PAST, UH, EFFICIENTLY.
NOW, IMPORTANT TO NOTE THAT BASED ON OUR CONVERSATIONS WITH YOUR BOND ATTORNEYS AND OTHER BOND ATTORNEYS ACROSS THE STATE, A TAX NOTE MUST BE ISSUED FOR AT LEAST ONE YEAR.
NOW YOU HAVE A DEBT PAYMENT ON FEBRUARY 15TH, 2024.
WHAT WE WOULD DO IS WE WOULD ASK THE BIDDERS TO GIVE US A PREPAYMENT OPTION OF FEBRUARY 15TH OF NEXT YEAR.
AT THAT POINT, YOU'D HAVE YOUR DEBT COLLECTIONS IN PLACE, AND WE WOULD PAY IT OFF EARLY, SAVING ON
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INTEREST FOR THE NEXT, UH, FISCAL YEAR.SO WE'RE SHOWING YOU A SCENARIO WHERE IF YOU HOLD IT TO MATURITY, YOU WOULD BE PAYING, UH, INTEREST FOR A FULL YEAR.
BUT IF WE PAY IT OFF ON FEBRUARY 15TH, WHEN YOU HAVE THE TAX COLLECTIONS ON HAND, WE WOULD JUST PAY, UH, UH, ONE INTEREST PAYMENT ON THE TAX NOTE.
AND THAT'S THE GOAL THAT WE DISCUSSED WITH YOUR CITY MANAGER'S OFFICE AND YOUR FINAL STAFF.
UH, AND IT SEEMS TO WORK WITHIN YOUR BUDGET, AND YOU'LL HAVE THE CASH ON HAND TO DO THAT.
WHEN YOU SAY CASH ON HAND, YOU MEAN FOR THE INTEREST PAYMENT SPECIFICALLY FOR THE, FOR THE, FOR THE ENTIRE DENTIST, FOR, FOR THE ENTIRE THING TO RETIRE, SPECIFICALLY, THE INTEREST PAYMENT WOULD STILL BE WITHIN CASH ON HAND, CORRECT? CORRECT.
SO AGAIN, AS A MATTER OF BEST PRACTICE, WE WOULD COME BACK TO YOU WITH A FINAL PLAN OF FINANCE THAT YOU WANT TO TACKLE DURING YOUR REGULAR SESSION OF, UH, SEPTEMBER 5TH.
UH, YOU, YOU DIRECT US TO MOVE FORWARD, YOU SAY? YES, GO AHEAD.
UH, CONSULTANTS START WORKING ON IT.
CITY STAFF, START WORKING ON IT.
COME BACK ON ON THE 19TH, I'M SORRY.
UH, COME BACK WITH A FINAL BID FIXED INTEREST RATE THAT YOU TAKE FORMAL ACTION ON AND THEN ENTER INTO THE DEBT INSTRUMENT YOU WOULD CLOSE ON OCTOBER 17TH.
HAD FUNDS AT THE CITY'S ACCOUNTS, AND THE GOAL IS TO PAY THIS OFF ON FEBRUARY 15TH OF THE FOLLOWING FISCAL YEAR.
ANY QUESTIONS, PLEASE? I'D HAPPY TO ADDRESS THOSE.
YOU TALKED ABOUT, UM, OUR RATING, HOW IT MIGHT, UM, BE ABLE TO, UH, ATTRACT INVESTORS.
CAN YOU GIVE US AN EXAMPLE OF HOW THAT HAS WORKED IN THE PAST? I MEAN, IS IT A COUPLE OF PEOPLE OR CAN YOU GIVE US A SITUATION WHERE YOU'VE SEEN THAT HAPPEN AND HOW THE RESULTS WORK? SURE.
SO IN THE PAST, DESOTO HAS, HAS SOLD COMPETITIVE DEAD IN THE COMPETITIVE MARKET, AND YOU'VE ATTRACTED STRONG BIDS.
WHY? BECAUSE WE HAVE A DOUBLE A RATING IN PLACE AND THAT OVER THAT LOWERS YOUR COST OF BORROWING.
YOU'RE, YOU'RE A LOWER RISK OF A, YOU'RE A LOWER RISK BORROWER IN THE EYES OF FINANCIAL INSTITUTIONS.
YOU'RE VERY HIGH, VERY LIQUID TYPE OF DEBT INSTRUMENTS TRADING A A DOUBLE A BOND VERSUS TRADING A TRIPLE B BOND.
IT'S EAS IT'S MORE LIQUID, AND YOU'RE LOWERING YOUR COST OF BORROWING 'CAUSE OF THAT.
NOW, WHEN WE BID OUT THIS TAX NOTE, WE'RE GONNA TALK TO BANKS AND THEY'RE GONNA LOOK AT YOUR RATING AND THEY'RE GONNA SAY, WELL, I'M GONNA LEND A LOWER RATE TO A DOUBLE A THEN A NON-RATED CITY OR A LOWER RATED CITY JUST BECAUSE YOU'RE LOWER RISK TO THEM.
UM, YOU PAY YOUR DEBTS, YOU PAY ALL OF YOUR OUTSTANDING BONDS, YOU'VE SHOWN A TRACK RECORD OF DOING THAT, YOU'RE LEVYING THE APPROPRIATE DEBT SERVICE TAX FREE TO DO SO.
AND ON TOP OF THAT, UH, YOU HAVE THE, THOSE EXISTING READINESS IN PLACE.
SO I THINK IT'S VERY LIKELY THAT YOU'RE GONNA GET A LOT OF ATTENTION BY, UM, BY MANY FINANCIAL INSTITUTIONS.
SOME OF THEM DON'T BID ON, UM, ANYTHING LOWER THAN A, SO SOME OF THEM DON'T BID ON ANYTHING LOWER THAN DOUBLE A.
SO YOU'RE OPENING UP YOURSELF UP FOR ALL OF THE POSSIBLE BIDS, IF THAT MAKES SENSE.
COUNCIL, ANY ADDITIONAL QUESTIONS? YES, COUNCILOR? UH, THANK YOU.
ARE YOUR PRESENTATION ON SLIDE NUMBER, UM, 12? NO, SLIDE NUMBER 14.
SO THE, THE INTEREST FOR IT, UM, I I I THINK THAT, UH, 14 AND 15 WAS, WELL, IT KIND OF CONFUSED ME ONCE I WENT BACK AND LOOKED AT IT.
SO THE, UM, THE FINANCING COST OF, OF DOING THIS IS ROUGHLY $63,000.
THAT'S JUST, THAT'S JUST THE FINANCING COST.
CONSERVATIVE BUDGET WE TAKE INTO ACCOUNT, UH, YOUR BOND COUNSEL, UH, A PLACEMENT AGENT WILL BE, UH, WHICH IS A, AN INTERMEDIARY THAT WILL MARKET YOUR TAX NOTE.
YOU'VE GOT THE ATTORNEY GENERAL'S FEE, YOU'VE GOT FINANCIAL ADVISOR, YOU'VE GOT, UM, A PAYING AGENT.
ALL OF THE ANCILLARY COSTS INVOLVED IN THE FINANCING.
THIS IS THE BUDGET WE'RE, UH, USING CONSERVATIVELY.
WE'LL REACH OUT AND FINE TUNE THAT FIGURE AS WE MOVE FORWARD IN TIME.
BUT BASED ON WHAT WE'RE SEEING IN THE MARKETPLACE, AND WE UNDERSTAND YOUR BOND COUNCIL'S FEES THAT YOU WORK WITH, UH, THIS IS WHAT WE CAME UP WITH AS A BUDGET, RIGHT? SO THE CITY WOULD GET 3.337 AT CLOSING ASSUMING THIS BUDGET STAYS SENSE.
AND, UM, I, I GUESS THE POINT I WAS TRYING TO REALLY GET TO WHEN YOU TALKED ABOUT, UM, YOU ANSWERED MY QUESTION, SO THANK YOU.
UH, THE FIRST QUESTION WAS, IS THERE ANY PENALTIES FOR EARLY PAYMENT? SO TECHNICALLY THERE'S NOT.
AND SO WE WOULD EXPECT TO PAY FOR IT IN FEBRUARY WHEN THE TAX, WHEN WE, UH, WHEN WE COLLECT THE PROPERTY TAXES, JANUARY, FEBRUARY OR SO, IS THAT CORRECT? THAT'S RIGHT.
WE WOULD ONLY LOOK AT BIDS WITHOUT A PREPAYMENT PENALTY ON FEBRUARY 15TH, 2024.
AND, UH, THE A AGAIN, JUST FOR THE
[00:35:01]
RECORD, YOUR ESTIMATED, UH, PERCENTAGE IS 5.5%, AND AS, UH, AND SO IF WE WENT THE FULL TERM, IF WE WENT THE FULL YEAR, THAT WOULD BE, UM, ACCORDING TO SLIDE NUMBER 15, UM, IF WE WENT THE FULL YEAR, IS THAT THE 1 1 54 7 94? IS THAT WHAT YOUR ESTIMATE? CORRECT.OUR CONSERVATIVE BUDGET IS 5.5.
IF, IF ALL THINGS EQUAL, IF WE STAY AT 5.5 AND YOU HOLD IT TO MATURITY THAT IT, IT, WE PAY IT OFF AT MATURITY, THAT WOULD BE THE INTEREST COST, YEAH, THE 1 54.
BUT BECAUSE WE'RE, OUR PLAN IS TO PAY IT OFF EARLY, THAT'D BE ROUGHLY THE 61,000 CORRECT DOLLARS, WHICH IN, IN EFFECT, JUST FOR OUR, UH, OUR CITIZEN SAVING ROUGHLY NINE $90,000 BETWEEN THE TWO, BETWEEN THE 1 54 AND THE 60.
WE PAY IT OFF EARLY, WE GET RID OF THE PRINCIPAL.
NO MORE INTEREST PAYMENTS LEFT.
THANK YOU MADAM MAYOR, COUNCILWOMAN, CHIEF, THANK YOU.
THANK YOU MR. DELGADO FOR YOUR PRESENTATION.
I JUST WANNA POINT OUT THAT, UM, THE SLIDE ONLINE, UM, FOR HILLTOP SECURITIES IS DIFFERENT THAN WHAT HE PRESENTED.
THERE SEEMS TO BE SOME SLIDES MISSING.
I DON'T KNOW IF, IF, IF THE ACTUAL PRESENTATION COULD BE SENT TO THE COUNCIL, SO WE CAN GET THOSE ADDITIONAL SLIDES PLEASE.
IF YOU WANT A PAPER COPY, I'D BE HAPPY TO PASS THOSE OUT.
RAPHAEL, GOOD THING, UM, FOR THIS, THANK YOU FOR YOUR PRESENTATION.
THANK YOU FOR, FOR YOUR PRESENTATION AS WELL.
UM, AND, UM, AND CITY MANAGER, RIGHT? I GUESS MY, MY QUESTION JUST IS SURROUNDING, YOU KNOW, SO THIS 3.4 MIL, UM, WHAT DOES THAT REPRESENT IN THE BUDGET? SO IF WE, IF WE DID NOT TAKE THIS ROUTE, IF WE TOOK THE ROUTE OF CUTS, WHAT PERCENTAGE WOULD THAT BE ACROSS THE BOARD? I'M TRYING TO REMEMBER.
THE, THE GENERAL FUND BUDGET IS AROUND 50, JUST A LITTLE OVER 50 MILLION, RIGHT? YEAH, YEAH.
SO, SO WHAT IS THAT ROUGHLY? YEAH, IT'S PROBABLY SOMEWHERE IN THE RANGE OF A SEVEN TO 8%, UH, REDUCTION.
AND HAVE WE TAKEN A LOOK AT WHAT THAT MIGHT LOOK LIKE IN VARIOUS DEPARTMENTS? LIKE ARE THERE CERTAIN DEPARTMENTS THAT COULD NOT ABSORB THAT HIT AND ARE THERE CERTAIN DEPARTMENTS THAT COULD, OR CERTAIN EXPENDITURES THAT COULD VERSUS COULD NOT? YEAH, WE, WE, WE, WE'VE TAKEN A, A QUICK LOOK THROUGH IT.
IF YOU, UM, THE, THE, THE REALITY IS IN THE GENERAL FUND, UH, BECAUSE ALMOST ALL OF OUR COSTS ARE PERSONNEL COSTS, UH, YOU, YOU SIM SIMPLY COULDN'T GET THERE BY DOING, UH, CUTS TO SUPPLIES AND SERVICES AND THINGS LIKE THAT AND DIFFERENT, YOU KNOW, DIFFERENT EQUIPMENT COSTS.
UM, FOR IT, YOU, YOU, YOU WOULD HAVE TO GET INTO PERSONNEL AND YOU'D HAVE TO START REDUCING PERSONNEL.
THE, THE, THE REALITY IS BECAUSE YOU TAKE A LOOK AT PUBLIC SAFETY, RIGHT? POLICE AND FIRE, THOSE MAKE UP ABOUT, YOU KNOW, 60 TO 70% OF THOSE COSTS, THOSE, THAT'S WHERE YOU WOULD, YOU WOULD HAVE SOME IMPACT INTO, INTO THOSE DEPARTMENTS ON IT.
NO ONE WANTS TO HAVE AN IMPACT INTO THOSE DEPARTMENTS.
UM, BUT THOSE ARE KIND OF THE AREAS WHERE YOU'D BE LOOKING AT.
UM, YOU COULD DO OTHER THINGS LIKE NOT MAKING CERTAIN EQUIPMENT PURCHASES FOR A YEAR.
YOU COULD ALWAYS DO THE, THE SHORT TERM GAPS, UM, OF DOING THAT.
THAT'S, THAT ALWAYS CATCHES UP BACK TO YOU.
SO ALTHOUGH YOU, YOU DON'T, DIDN'T SPEND THE MONEY RIGHT NOW, THE REALITY IS THAT THAT PAYMENT IS COMING AT SOME POINT IN THE FUTURE.
UM, IT'S JUST A DELAY TO, UH, TO GET TO THAT POINT.
AND SO IF, IF, IF YOU GO DOWN THE ROAD OF CUTTING THE TAX RIGHT, THE, THE TAX BILL BY ABOUT THREE AND A HALF MILLION DOLLARS, UM, YOU'RE LIKELY INTO PROBABLY SOME PRETTY SIGNIFICANT LEVELS OF PERSONNEL CUTS AS WELL AS LOOKING AT SOME EQUIPMENT AND DELAYING SOME PURCHASES, UM, UH, ACROSS SOME, SOME DIFFERENT AREAS FOR THAT.
AND THEN, SO JUST, UM, HIGH LEVEL, YOU KNOW, BASED OFF WHAT WE'VE JUST PRESENTED, SO MOVING FORWARD, SO WHAT DOES MOVING FORWARD LOOK LIKE AGAIN? SO I KNOW WE HAVE SOME TOOL OPTIONS, BUT WHAT DOES THAT REALISTICALLY LOOK LIKE? CORRECT.
YEAH, SO, SO THIS IS, SO WHAT WE'RE PRESENTING RIGHT NOW IS IN, IN, IN MANY OTHER CITIES ARE DOING WHAT WE ARE DOING RIGHT NOW.
AND SOME OF THEM STARTED A YEAR OR TWO AGO, UM, WITH THIS INDEPENDENT ON KIND OF HOW MUCH, UH, INCREMENT THEY HAD, HOW MUCH FLEXIBILITY, HOW WELL THEY WERE ABLE TO KIND OF MANAGE SOME OF THOSE DIFFERENT ELEMENTS OF, OF THIS.
UM, WHERE WE ARE RIGHT NOW IS THAT BY SHIFTING SOME OF THE OPERATING OVER TO, TO DEBT PART OF IT, RIGHT, WE'RE ABLE TO MAINTAIN REVENUE EVEN THOUGH WE HAVE TO, TO SHIFT THOSE THINGS, AT SOME POINT YOU LOSE THE, THE AMOUNT OF ITEMS THAT YOU CAN MOVE OVER TO DEBT, UM, ON THAT.
AND THEN YOU'RE REALLY FACING THE ELEMENT OF TRYING TO LIVE WITHIN THAT THREE AND A HALF PERCENT, UM, PART OF IT.
AND AT THAT POINT, YOU'RE, YOU ARE IN A WORLD OF EXISTING SERVICE LEVEL IS YOUR BUDGET FOR NEXT YEAR.
THERE'S, THERE'S REALLY NO ADDING TO IT.
'CAUSE WHEN YOU ADD SOMETHING NEW TO IT, YOU'RE GOING TO EXCEED THAT THREE POINT HALF PERCENT AND THAT'S JUST GOING TO SET YOU UP IN A, IN A, IN A FAILURE WITHIN A COUPLE OF YEARS IF YOU DON'T, UH, BEGIN TO ADDRESS THAT PART.
AND SO YOU, YOU CAN GO TO VOTERS AND YOU CAN ASK FOR ADDITIONAL APPROVAL THERE, UM, OR YOU CAN CUT OTHER AREAS OF YOUR CITY TO MAKE
[00:40:01]
UP FOR SOME OF THE ADDITIONAL THINGS YOU WANT TO DO, UM, FOR THAT.SO YOU'RE ALWAYS, YOU'RE, BUT YOU'RE ALWAYS TRYING TO LIVE WITHIN THAT THREE POINT HALF PERCENT.
UH, ONE OF THE NICE THINGS THAT WE HAVE AS A CITY IS BECAUSE WE HAVE THAT FIVE, UH, I'M SORRY THAT THAT HALF A PERCENT, UH, SALES TAX NUMBER THAT IT GOES INTO THE GENERAL FUND.
WE HAVE A SECOND YEAR OF FLEXIBILITY AS IF WE ARE TO GO TO VOTERS AND ASK FOR THAT TO SHIFT FROM PROPERTY TAX REDUCTION TO SOMETHING ELSE LIKE PUBLIC SAFETY.
WHAT THAT ALLOWS US TO DO IS BE ABLE TO PUT THAT AMOUNT OF MONEY BACK IN PLAY IN THE TAX RATES, WHICH ALLOWS US TO ADDRESS OUR SERVICES, UM, ON THAT PART.
SO, SO THAT'S ANOTHER YEAR, UH, OF POTENTIAL SOLUTION THAT WE HAVE.
UM, AS WE MOVE FORWARD, OBVIOUSLY THE COUNCIL WOULD BE NEEDED FOR APPROVING AN ORDINANCE THAT WOULD GO AHEAD AND SET, UH, THAT ON THE MAY, THE MAY BALLOT FOR, FOR NEXT YEAR.
UM, BUT THAT, THAT, THAT WOULD BE ANOTHER THING.
BUT BEYOND THAT, YOU'RE, YOU'RE IN THE WORLD OF TRYING TO LIVE WITHIN THAT THREE POINT A HALF PERCENT EVERY YEAR, UM, AS, AS WE MOVE FORWARD.
THAT STATEMENT IS, OH, I'M SORRY.
THAT STATEMENT IS, IS WITH THE ASSUMPTION THAT THE PROPERTY TAX REVENUE, LA THE VALUES LEVEL OUT.
SO IT, SO HERE, HERE'S THE FUN PART.
IT DOESN'T MATTER, OKAY, REALLY TAX, UM, IF, IF YOU THINK OF IT LIKE THIS, AT, AT THE END OF THE DAY, IT, WHAT IT DID IS IT SAID WHATEVER AMOUNT OF MONEY WE COLLECT THIS YEAR IN TAXES, NEXT YEAR WE'RE GOING TO GET THAT AMOUNT PLUS 3.5% AND THAT'S IT.
WELL, SO WHETHER OR NOT THE PROPERTY VALUES GO UP OR DOWN DOESN'T EXACTLY.
DOESN'T MATTER WHAT YOUR, IT DOESN'T MATTER WHAT YOUR VALUES DO.
IT BECOMES ACTUALLY, ACTUALLY FROM A FINANCING TOOL, IT BECOMES VERY PREDICTABLE, UM, BECAUSE YOU KNOW THAT IT'S WHATEVER AMOUNT OF REVENUE AT 3.5%, THAT'S THE AMOUNT OF MONEY YOU'RE GONNA GET NEXT YEAR.
YOUR WHATEVER MATH IT TAKES TO GET FROM THE VALUATIONS TO THE TAX RATE TO EQUAL THAT 3.5%, THAT'S WHAT IT'S GONNA BE.
AND THUS IS THE ARGUMENT FOR THIS, UH, CREATIVE TOOL.
SO THAT WE DON'T FALL WITHIN THAT, THAT THAT, UH, THAT CAP UN UNTIL WE HAVE TO.
AT SOME POINT, EVERY CITY GETS CAUGHT UP INTO THAT OF LOSING THE TOOLS AND FINALLY LIVING WITHIN THAT THREE POINT A HALF PERCENT ONLY ON THAT PART.
AND SO THAT, THAT'S WHERE WE'RE TRYING TO PROLONG HOW LONG UNTIL THAT THAT PART HAPPENS.
SO WHAT IS THAT PROJECTED? IS THERE A PROJECTION OF WHEN THAT MIGHT BE? SO, SO NEXT YEAR WE WILL SEE, UM, SO, SO AGAIN, NEXT YEAR IT WILL DEPEND ON HOW, UH, THE DECISION IS MADE FOR SALES TAX, RIGHT? ON THAT ONE.
SO IF, IF WE DO THAT, WE WILL HAVE ADDITIONAL CAPACITY AVAILABLE TO US NEXT YEAR BECAUSE OF THAT 5 CENTS CHANGE.
OR I, I CALL IT 5 CENTS 'CAUSE IT'S ABOUT 5 CENTS ON THE LEVY.
THAT, SO SORRY IF I'M TALKING IN A DIFFERENT LANGUAGE RIGHT NOW.
UH, BUT WE, WE GAIN, WE GAIN AN ADDITIONAL ABOUT THREE AND A HALF MILLION DOLLARS THAT JUST HAPPENS TO BE JUST ALMOST THE NUMBER WE'RE TALKING ABOUT RIGHT HERE.
WE GAIN AN ABOUT AN ADDITIONAL THREE AND A HALF MILLION DOLLARS THAT WE HAVE AVAILABLE TO US TO COLLECT IN PROPERTY TAXES, UM, BECAUSE OF THAT.
UH, SO, BUT THAT, THAT BECOMES KIND OF THAT ONE YEAR SOLUTION RIGHT ON IT.
SO YOU HAVE THE THREE AND A HALF PERCENT PLUS WHATEVER YOU GET FROM THE SALES TAX CHANGE.
AND SO THERE'S A YEAR FOR US TO BE ABLE TO HELP MAKE SURE THAT WE'RE RIGHT SIZING THINGS NEXT YEAR, UM, ON THAT.
AFTER THAT THEN THERE'S REALLY, THERE'S, YOU LOSE THAT FLEXIBILITY OF HAVING ANOTHER TOOL TO TURN TO, TO HELP YOU BALANCE THAT AMOUNT OUT.
BUT WE COULD GO BACK TO THE SAME TOOL.
COULD WE GO BACK TO, IS THIS A ONE? CAN YOU CUT? I'M SORRY.
UM, WERE YOU DONE, UH, IS THIS A ONE TOP, A ONE SHOT STOP? CAN WE ONLY DO THIS ONE YEAR OR COULD WE, COULD THIS BE AN A THE TOOL? THE TOOL, YEAH.
SO IT WILL, SO THE BENEFIT OF IT ONLY HELPS US IN ONE YEAR.
AND HERE'S WHY IS BECAUSE NEXT YEAR WE WILL STILL HAVE EQUIPMENT THAT WE NEED TO REPLACE AND WE DON'T HAVE ADDITIONAL ROOM TO MOVE IT IN, IN ADDITION TO ALL THE, ALL THE OPERATING ITEMS WE'RE PAYING OUT OF THE M AND O LEVY, RIGHT? SO THINK OF IT LIKE THIS.
I HAVE, LET'S JUST CALL IT, I HAVE $10 MILLION OVER HERE AND I TAKE A MILLION DOLLARS OUT AND I'M FUNDING IT OVER HERE TO FIT IT BACK INTO THIS CATEGORY OVER HERE, RIGHT? I HAVE TO HAVE AN ADDITIONAL MILLION DOLLARS OF CAPACITY TO PUT IT BACK IN.
IT'S VERY DIFFICULT FOR ME TO FIND THAT CAPACITY TO MOVE IT BACK IN.
SO IT STAYS OVER HERE WHERE YOU'RE GONNA GET, CONTINUE TO PAY FOR IT OUT OF THIS SOURCE THAT'S ALLOWED TO FLEX WITH IT AS YOU NEED TO.
BUT GETTING IT BACK IN YEAH, BECAUSE THIS IS CA CORRECT.
JUST DOESN'T HAPPEN LIKE THAT.
SO AT THE END OF THE DAY, I GUESS THE INTENT WAS FOR, FOR MY LEGISLATORS WAS FOR, YOU KNOW, IF WE GO ANY, GO ANYWHERE BEYOND THAT 3.5, WE NEED TO TAKE IT TO OUR RESIDENCE.
AND SO, AND, AND, AND WE CAN THAT'S, YEAH.
AND WE CAN LITERALLY DO THAT EVERY YEAR, I GUESS.
YEAH, IN FACT, I, I HAD, I, I WAS TRYING TO LOOK FOR CITIES THAT HAVE BEEN DOING THIS, UH, THE OTHER DAY I HAPPENED TO RUN INTO THE CITY MANAGER FROM MESQUITE, UM, AND THEY HAVE ONE GOING UP RIGHT NOW ON IT.
IT'S, IT'S AN INTERESTING PROCESS
[00:45:01]
NOT TO PROLONG THIS MEETING.I DON'T MEAN TO, BUT IT'S AN INTERESTING PROCESS IS THAT YOU, YOU HAVE TO APPROVE, UH, THAT THAT RATE THAT'S ABOVE THE VOTER APPROVAL RATE, YOU HAVE TO APPROVE THAT RATE.
IT'S THEN AUTOMATICALLY SET FOR ELECTION IN NOVEMBER.
SO THAT'S, THINK ABOUT THAT'S AFTER YOUR FISCAL YEAR STARTS.
YOU'RE ASKING VOTERS TO APPROVE THAT AMOUNT OR NOT.
IF THEY TURN IT DOWN, IF IT'S VOTED NO, YOU ACTUALLY HAVE TO GO BACK AND RETURN ALL OF THE MONEY THAT YOU COLLECTED IN OCTOBER TO THE VOTERS.
IT'S, IT'S A VERY ARDUOUS PROCESS TO GO THROUGH, UM, WITH THAT.
AND SO WE, WE, WE, WE WILL WANT TO BE CAREFUL, UM, AND THOUGHTFUL ABOUT THE WAY THAT WE WOULD APPROACH ANY SORT OF A, UH, OF AN ELECTION ON THAT.
ELECTIONS WEREN'T SET UP NECESSARILY TO FAVOR THE CITY'S, UH, USING THAT FULLY, EFFECTIVELY.
AND THEN FOR THE CITIES THAT HAVE GONE THIS ROUTE, I THINK IT WAS ABOUT 44 CITIES THAT HAVE GONE THIS ROUTE.
LAST YEAR, WE, WE FOUND 44 CITIES THAT DID THIS LAST YEAR USED THIS TOOL.
SO FAR WE'VE SEEN 21 BEING UTILIZED, UH, AS A COMMON ANNUAL PRACTICE, UH, AS A TOOL, ANNUAL TOOL ON, ON TOP OF THE REGULAR CIP, UM, SOME OF YOUR NEIGHBORING COMMUNITIES HERE DO IT ON AN ANNUAL BASIS.
UH, IT'S, UH, WELL, LET ME ASK THIS QUESTION.
UM, SO THEY, THEY, THEY'VE BEEN DOING THIS OUTSIDE OF WHAT THE HOUSE BILL SAYS.
SO WHAT THE SENATE BILL SAYS, THEY, THEY WERE USING THE TOOL FOR THIS PURPOSE.
HOW MANY OF THOSE THAT YOU'VE RESEARCHED WERE DOING USING THIS TOOL BECAUSE OF THE NEW LEGISLATION? I WOULDN'T KNOW THE ANSWER TO THAT.
I, I KNOW SOME OF THE CLIENTS THAT WE WORK WITH USE IT AS A, AS A TOOL FOR THEIR ANNUAL BUDGET LIKE WE'RE DISCUSSING TODAY.
I DON'T KNOW THE REMAINDER OF THE TEXAS COMMUNITIES, HOW THEY IMPLEMENTED, UH, AS PART OF THEIR BUDGET.
BUT I, WE DID FIND, UM, 44 DONE LAST YEAR.
UH, WE DID FIND A LOT OF THEM WERE UTILIZED IN THE PAST YEAR AND CURRENTLY, BUT I, I CANNOT SAY WHO USE, WHO USES IT AS A TAX RATE MANAGEMENT TOOL AND WHO DOESN'T.
AND GENERALLY, WHAT SIZE WERE THOSE CITIES, THE ONES THAT YOU ARE AWARE OF, WHETHER THEY OH, UM, 200,000 POPULATION OR 40,000 POPULATION, ANYTHING? UM, YOU KNOW, THERE, THERE REALLY ISN'T, UH, POPULATION AVERAGE, IF YOU WILL.
UH, I THINK, I THINK IT'S ALL OVER.
AND THESE WERE TEXAS CITIES? TEXAS CITIES, YES MA'AM.
IT IS, UH, 6:47 PM WE KNOW THAT THERE IS NO ACTION TONIGHT REQUESTED REGARDING THIS ITEM.
THIS IS, UH, FOR A DISCUSSION, UH, FOR A, UH, FOR OUR SEPTEMBER 5TH MEETING.
SO I'M GOING TO, UM, ADJOURN THIS PORTION OF THE MEETING IN TERMS OF THE TOPIC, UH, TO MOVE TO, WE KNOW WE HAVE AN EXECUTIVE SESSION AS WELL TONIGHT.
SO I'M GOING TO, UM, UH, GOING TO END THIS, END THIS PARTICULAR DISCUSSION.
WE KNOW THAT OF COURSE WE CAN FILL ADDITIONAL QUESTIONS OUTSIDE OF TONIGHT'S MEETING.
UM, BUT AGAIN, THANK YOU FOR YOUR PRESENTATION.
WE APPRECIATE, UH, THE INFORMATION AND WE'LL DEFINITELY BE LOOKING FORWARD TO REVISITING, UH, THIS TOPIC.
SO AT THIS TIME, MS. UH, THOMAS, CAN YOU HAVE THE NEXT ITEM ON THE AGENDA, PLEASE? I'M SORRY, MADAM MAYOR, UM, THIS IS A REALLY IMPORTANT TOPIC.
CAN WE GET THIS INFORMATION, UM, SOME INFORMATION SENT TO US AS IT RELATES TO THE BOND MARKET? 'CAUSE THE, I I, I WAS UNCOMFORTABLE WITH, I'M UNCOMFORTABLE WITH WHAT'S HAPPENING IN THE BOND MARKET, BUT YOU SAID THERE WAS A FLEXIBILITY PIECE, BUT IS THERE ANY UPDATED INFORMATION WE CAN GET AS WE GO THROUGH THIS PROCESS? YOU KNOW, JUST IN UNDERSTANDING THE VOLATILITY OF THE MARKET OR STABILITY OF THE MARKET RIGHT NOW.
AND THAT'S SOMETHING, IF WE CAN GET THAT, YOU KNOW, VIA EMAIL OR WHATEVER, I APPRECIATE IT.
NO, I, I SAW THAT PART, BUT LIKE, I'M CURRENT, LIKE WHERE WE ARE TODAY, LIKE OVER THIS NEXT WEEK, YOU KNOW, WHAT THAT MIGHT LOOK LIKE OR EVEN AS WE, YOU KNOW, APPROACH THE REGULAR MEETING.
UM, THAT'S MY, THAT'S MY CURIOSITY AND THAT'S KIND OF MY CONCERN, MY FEAR.
SO THAT'S WHAT I WANNA MAKE SURE WITH THE REQUEST.
IS IT, IS IT TO, TO KNOW WHERE RATES ARE TODAY? YES.
SO, SO WE HAVE TODAY AND THEN OVER THE NEXT FEW WEEKS BEFORE WE GET TO OUR SEPTEMBER MEETING, YOU KNOW, JUST MAYBE A, A MAYBE NEXT WEEK AN UPDATE OF WHAT THE FLUCTUATIONS LOOK LIKE.
BEFORE WE GET TO THE ACTUAL VOTE.
WE'LL, WE'LL PROVIDE THAT INFORMATION AS WE MOVE ALONG.
UH, WE'LL EMAIL IT TO, TO CITY STAFF.
[3. The City Council will convene into Executive Session pursuant to the Texas Government Code, Section 551.071(2), for the purpose of seeking legal advice from the City Attorney regarding the follow provision contained in the City's Subdivision Regulations: Article 10.400; Section 10.406 titled "Mandatory Homeowners' Association." a) Take any necessary action as a result of Executive Session]
ITEM ON THE AGENDA, PLEASE.THE CITY COUNCIL WILL CONVENE INTO EXECUTIVE SESSION PURSUANT TO THE TEXAS GOVERNMENT CODE SECTION 5 5 1 0.0712 FOR THE PURPOSE OF SEEKING LEGAL ADVICE FROM THE CITY ATTORNEY REGARDING THE FOLLOW PROVISION CONTAINED IN THE CITY SUBDIVISION REGULATIONS ARTICLE 10.400, SECTION 10.406 TITLED MANDATORY HOMEOWNERS ASSOCIATION, AND ANY NECESSARY ACTION AS A RESULT.
THANK YOU, MS. THOMAS, AT THIS TIME, IT'S 6:49 PM AND WE WILL CONVENE UNTIL EXECUTIVE SESSION.
IT'S 8:28 PM AND WE HAVE ADJOURNED FROM EXECUTIVE SESSION.
UM, THERE WAS NO ACTION AS A RESULT OF OUR EXECUTIVE SESSION.
HOWEVER, I DO WANT TO MAKE SOME COMMENTS IN TERMS OF DIRECTION THAT, UH, COUNCIL HAS GIVEN TO STAFF.
WE GAVE DIRECTION TO OUR CITY ATTORNEY AND CITY MANAGER TO BRING BACK SOME RECOMMENDATIONS, UH, REGARDING
[00:50:01]
MANDATORY HOAS AND THE IMPROVEMENT OF STANDARDS, UM, FOR OUR STANDARDS AND REGULATIONS FOR MANDATORY HOAS.SO WE ARE LOOKING, UH, FORWARD TO RECEIVING SOME INFORMATION REGARDING IMPROVEMENTS TO THOSE STANDARDS AT THIS TIME.
COUNSEL, UH, THERE ARE NO FURTHER ITEMS ON OUR AGENDA.
I WILL ENTERTAIN A MOTION TO ADJOURN.
SO SECOND, UH, IT'S BEEN MOVED BY MAYOR PRO TEM HUGHES.
UH, SECOND BY COUNCIL MEMBER PARKER TO ADJOURN.
COUNCIL ALL IN FAVOR, PLEASE SAY AYE.
THAT MOTION PASSES UNANIMOUSLY.
IT IS 8:31 PM AND WE ARE NOW ADJOURNED.