Zach Walker here who's the new city manager of the city of Bloomington. Zach is the fourth city manager since the charter was adopted in 1960. >> Um, which gives you an idea of what sort of tenure we have around here, which I suspect was part of the appeal of the job is that it's a it's a job where you had to kind of come to do things and and uh and and have an impact over a period of time. Zach Hails from Independence, Missouri, where he was last the city manager. Um, I don't know how we got him to come up north. Maybe he'll explain that as part of his conversation here. But I know that the council members that I've talked to are really excit excited that Zach came to the city and take the job because quite honestly, it's a it's a really great job. It was a competitive position to hire for. I think we uh had a good set of candidates and got somebody where I think um I think uh it's a sort of person that we need in that sort of role. So, Zach, you know, you want to tell us a little bit about your background and you started in on in October, so now you're like a seasoned professional at this point. >> Yeah, why not? Uh, thank you, Steve, for that introduction and thank you all for the chance to come in. I know you've got a lot of work to start tonight, so I won't take too terribly much time, but it was important for me um to come in and say hello uh number one. So, just as background, um as Steve mentioned, my name is Zach. I've been on the job since October 20th. Uh so almost three months now. Um long enough that some names and faces are starting to look familiar to me which is great. Um I started my uh local government career in Kansas City, Missouri. I was there for uh a little over five years and then went to Independence uh was in a couple of different positions in Independence, Missouri. Uh but served the last 10 years as city manager of that community. And if you're not familiar, Independence is part of the Kansas City metro. It's about 120,000 people and best known to most people as being the hometown of President Harry Tr. Yeah. >> Yeah. So, um I uh really enjoyed my time in Independence, but to Steve's point, um you know, after 10 years, I was kind of looking for some fresh opportunities and new challenges to um excite me. Um and as I saw this opportunity come by, I will tell you I saw a community with strong elected leadership. Um really a strong respect and reverence for the form of government and and understanding the importance of that form of government. Um a very strong, capable, talented city staff. And just as you drive around this community, it's evident that it is a city that um values and prides itself in investing in itself, caring for itself, bettering uh the community for both those that live here, but those that will come to live here eventually. And as a city manager, those are some really powerful ingredients to do some really exciting things in a career. So, I really felt like the skills that I had um aligned well with what Bloomington had to offer and where Bloomington wanted to go. Uh and so was fortunate to be selected uh into this role. Um I tell people that, you know, every city when they recruit puts out the glossy brochure about all the great things that are happening. What's been great for me is it's all true. Um it's it's what you see is what you get. Um this is a very very um strong organization um with employees top to bottom who are dedicated public servants and very much take pride in the work that they do. Uh and certainly makes my job a lot easier uh to do that as well. So um only other thing I wanted to say and really what was important to me to come tonight is um the work of this committee uh I hope you know is extremely important and I wanted to lift that up. Uh, I wanted to share with you um my appreciation for what you're doing. Um, the community I was last in um did not have the same statutory requirements that Minnesota does. So, they went 40 years without reviewing their city charter. Uh, which was a minor um disaster uh to start a charter commission after 40 years. Um so I'm very impressed with the um tenure, the longevity um of many on this group, but also the fresh perspectives that are coming forward uh and your passion and interest in making sure that our foundational governing document remains current and fresh and relevant to uh the time. So thank you uh for the work that you're doing. Um happy to answer any questions that you guys may have um but also want to be respectful of your time. So yeah, we got a couple minutes to folks have questions for now. Now is the probably the best time you're going to get >> ask the question. So, >> you have a family? Do you play tennis? >> Um, I played tennis in high school. My tactic was to serve and run straight to the net. Uh, and use my 6'4 height. Uh, but if you got over my head, I was doomed. Um, so not active tennis player much anymore. Um, I do have a family. have a wife uh and then a 15year-old son uh and a 12-year-old daughter. So, and um yeah, everybody is really handling the move well, well adjusted. Um we are trying our hands at all the different winter sports except ice fishing. I'm still not really feeling walking out on a pond or a lake. Uh, but we've really tried um to acclimate and get um uh involved in in this season so we can kind of see what we like as well. >> Any other questions? >> Just out of curiosity, as you look ahead to the next couple of years, what are some of the bigger challenges you foresee for Bloomington or kind of what's on your radar? >> Yeah. Um, couple of things. Um I I really see a a shifting um demographic. You know, like the home that I bought uh was a family uh who had raised their kids, kids had moved out, moved on. Um they were ready to downsize to something else. And I think that story um is kind of true across the community. So I it's important to me that we um create and preserve housing so that folks who are maybe looking to downsize can still a community uh but also make this a community that's attractive to families to move into um so that um we can still continue to have a strong population and engaged community that like I said prides itself in the city invests in takes care of the properties that both they own but you know investing in the community. Um I really am, you know, looking a couple of moves down in chessboard, but I'm worried with what I see at the federal and state level about um financials. Um you know, the state's facing a large forecasted deficit here in a few years. Um seems like the funds that are flowing from the federal government or are they being turned off or very intermittent with prolonged government shutdowns. Um so I think making sure our house is in as strong a financial order as possible. That was also very attractive to me, a city with strong finances, but that requires ongoing um care and diligence to preserve that. Um, fortunately, we got one of the best over there. Um, so we'll continue to work on that. Um, and then I think just continuing to um find those things that will help, you know, make Bloomington continue to do those big things that have helped it stand out. Um, you know, I think it has a history of not being afraid to tackle really big um, ideas and audacious projects and um, identifying what's responsible to do, but also continuing to um, leverage that willpower that our community seems to have to to find that next uh, exciting thing that keeps Bloomington at the forefront of both the state and national um, uh, communities. >> Cool. Yeah. We have any questions? >> Zach, I would assume you've mastered the Mall of America finance packaging. >> Oh, that uh looks like a Jackson Pollock painting to me. Lines everywhere. Uh yeah, good good strong partner, but yeah, complicated financials for sure. >> Other questions? >> So, I'm going to tell you two questions that you should absolutely not answer. Question number one is where's downtown Bloomington? You should not answer that question. >> The other question, this is even more serious than the not downtown Bloomington is do not answer the question of where the border is between East Bloomington and West Bloomington. Do not answer that question. >> I tell you not to answer. Okay, >> I agree. It's >> your advice. Yeah. >> Well, thanks for coming out today. Appreciate it. We're in the process just to set up a little bit of context. The commission decided Was it two years ago? I think two years ago, we decided that we kind of go through a grand tour of the charter because the the group hadn't done that in quite some time. And so we've been doing is just having a couple extra meetings a year where we pick off part of the charter and walk through it and talk about it. Um and generally know we we have a lot of conversation about like why is it this way? We have some sometimes we have conversations about you know should things be different. Um, but the bar that we've been kind of using so far has been things that we can get through the seven vote process, which means they got to be pretty non-controversial to have that sort of change. And so this I just I didn't think it's been educational. I I can see the gears turning some people's heads on stuff, but at least right now our our objective has been to do things that just kind of seem sensible to everyone in the council. So tonight, that's one of the topics today. That's why Lori's here. So, okay. Thanks. Good luck. >> Thank you. Well, I appreciate you. Let me stop by your meeting. >> Best of luck to you. >> Okay, we'll then cut over to the second agenda item, which is charter presentation. >> Right. Um, while we get started, I want to just note for the recorded record that we have, um, all of our members here in person except for Cynthia Hunt, who is online. Uh so I wanted to take this opportunity to just let you all know that the law recently changed and if you need to participate remotely um there there are no longer requirements about sort of certain medical conditions or um a limit on the number of times that you can be remote. Uh so in the event that you need to uh bail yourself of that option. Um the sooner that we know the the much better it is to be able to prepare for that. But just to know that things are um are more flexible than they have been historically. So um we will continue to make an online option available. Uh the one thing to note, it doesn't really apply tonight until we get to adjournment, but it does recall require a roll call vote every time you vote when you have anyone participating remotely. And then the other nuance to it is that you have to have your camera on and you have to be able to see and hear everyone and everyone needs to be able to see and hear you. So that's the the nuance to it. Um I uh while legal to participate from a remote location, um you know, I think all of you are seasoned enough in in this work to know that nothing really replaces being in person. But um every now and then um when life throws you a curveball, you but you still want to be able to participate, it's really great to be able to have this remote option. So just wanted to make you all aware of that. that's um the the the sort of vehicle by which um Commissioner Hunt is joining us tonight. So, it's great to have that as an option because she brings so much to the discussion, too. So, um all right, with that as an introduction >> before we get started, can I call a roll? >> Sure. Go ahead. >> Um because I think we skipped over that piece just um I'll call people's names and you can just reply with I'm here. Um and I will mark you down as present. Uh Rod Axel here >> present. Ronald Barnes >> here present. Lucain here is not present. John Eagle is not present. Jacob Hartman >> here. >> Present. Cynthia Hunts >> here. >> Present. Lindell >> here. >> Present. Aaron Lungquist >> here. >> Present. Emil Masuja >> here. is present. McGovern not present. Emily Melby >> here. >> Present. Landa Lafa Oriho >> here. >> Present. Chair Peterson >> here. >> Present. >> Michael Ramirez. >> Present. >> Mark Thorson. Present. >> Thank you. >> Great. >> All right. So, um, a little, this is a bit of a unique PowerPoint presentation because, um, when, um, Chair Peterson and and I talked, we weren't sure how much we were going to get through. Um, we have three meaty chapters. And so, I put together one large PowerPoint, um, that contains sort of all the material for both tonight and next Thursday. given how close in proximity the two meetings were, I didn't want to wait and sort of drop the rest of it on you today. Um, which would be when the the agenda comes out for for next week's meeting. So, we put it all together into one package and I'll defer to the chair to um sort of manage how far we get to where we get tonight. Um, we have some sort of offramps and plans that we ran through. So, we'll defer to how long the conversation requires tonight and then what we don't get done with tonight, we'll we'll cover on the 15th. And then what we don't get done with on the 15th will roll into April. Um, there's one edit um on the on the PowerPoint from what I sent out. uh in that and Adrian and I were talking sort of through some a lot of logistics and realities and um ultimately the the amendments if we make any will will need to come in April. Um it's not going to be possible to really do the job that's required by Thursday. So um so that's the one edited on like page 65 or something like that. But I just wanted to make sure that you knew that difference. Um so with that let's get started. Um, we took this approach. We put a QR code in your in your PowerPoint so you can use your phone to scan that if you ever want to pull up the the charter um as opposed to printing out all the copies for you. This is the timeline that um that Chair Peterson was referring to. We're in uh in the last bullet point here, marching our way through. >> And as you see, we've just got three chapters left after after this year. So, we have made a lot of progress. um a list of those chapters. And so tonight, our goal will be to get through chapter 7. Well, my sort of my tenative goal um and to be mindful of Lor's time here. Um to get through chapter 7. Uh and um that's entirely possible. Chapter 8 is just two sections, very short. Chapter 12 is um is relatively short, but there's some meaty things in it. And then there's a couple of other um items that that the chair and I would like you to to think about with regard to chapter five um that we talked about last year. So um with that as introduction, any questions before we turn it over to Lori to talk about some of the borrowing that we'll be be discussing in greater detail tonight. So, we wanted to have a little bit of an introduction to the topic of municipal borrow borrowing because in addition to being difficult to say, it's also a complicated topic. So, Lori's going to give us a little bit of background 101. So um local governments, municipal governments I would say throughout um generally we have the authorization to um borrow money and we normally do that to pay for large um capital improvement projects and um what part of those are doing is that um we borrow the money now um and instead of and we build the project immediately and then we gradually repay it over time um similar to like your mortgage. um you get into your house and you paid over time. Um and so one of the things is that um when we do that, we want to kind of keep um you know, if we were to build it now, um we don't want to have a huge spikes in our tax levy. So, you know, you know, you might have to um borrow $10 million and you don't want to have to pay it back in two years because then that $10 million is a lot of tax levy to increase at one time. So um you know and so it helps us keep our taxes relatively stable and we pay the debt slowly and predictably. Um and then you know our bonds are generally um um you know again it matches the economic um benefits. So, um I just want to make sure I use the the right wording for that. But, um you know, you know, with spreading it across time, um the future users um when they pay their tax levies to pay these bonds are also contributing. So, you know, all tax, you know, through the say it's a 10-year bond duration, um everyone's paying during that whole 10 years. So, if you're moving and coming in and out of the city, um you'll pay during that year that you're in the city with your tax levy. And then it gives us a light a wide variable um of investors. Generally, depending on the size of the bond um we can have four to 11 different investors from across the world um looking at our bonds and bidding on them. And so, um we just try to manage our budgets very efficiently. So >> I just want to want to comment on that. Um the just to kind of dive in a little bit more on what Lori said about there's there's a people initial a lot of times will say well why don't we just save and go you know save the money after go buy something. But there's a there's a fairness fairness argument to that because if you make you basically say we're just going to raise taxes now and save the money now and then buy something 20 years from now. the people now, this generation pays for it and the next generation gets the benefit of the investment. And so from a kind of fairness perspective, there's actually a argument that that borrowing to do projects and pay paying for them over time matches up the benefit that people get in the community from with the cost of doing it. So that you're that the right people are paying for it. So like a good example is we have the project that's going on related to the community center which is something that's going to be a benefit for the community and that's going to be paid for over the time that the people who use it get the benefit. >> Yeah. Over the next 20 years. >> Yeah. Over the next 20 years. Um and then the other thing I think that was a little bit subtle in there that I'll just point out is that um like on point five which is accessing a black pool of investors. um having my understanding was that when from when I was on the council is having having a rather regular rhythm of borrowing where you're in the market on a regular basis um gets investors thinking hey I want those bonds and that increases that pool of investors that come and bid on the on the bonds and so when when Lori talks about the the kind of investors it's literally the city says hey what are you going to pay us for these bonds and they come with proposals to do that and then that gets matched up. That's how the price ends up getting set. >> So that's that's one of the reasons why you do it is having that rhythm there gets people used to the idea that will be available. >> And and one thing to also point out, the city is a AAA city with both um excuse me, standard and pores, Fitch, and Moody's. Um there are only like 33 other cities across the country that have all three AAA's. There's there are cities that have a AAA but not from all three organizations. And that's been since 2004 >> which results in us having a low interest rate when we go to pay. >> And that was a question I was going to raise is that is a the bond market because of AAA ratings we're able to borrow what 25 to 50 basis points less than >> um the next tier down. Yeah. >> So it saves everybody money. >> Yeah. and all the taxpayers money. >> The lower the interest rate, the better we can get. >> That's right. >> And to Steve's point is that the wild wide pool investors ends up being an auction. So it's, you know, they feel really comfortable with Bloomington and the uh and the realization recognition that they're going to get paid back. >> Yeah. >> Yeah. We're a very stable city. >> And this is just a kind of a calendar. It's not telling you everything that we do or this um the capital improvement process time frame. This is just telling you for this particular project um say in March of 2017 this fire station was placed in the CIP and it wasn't until um 2021 that the council looked forward to actually moving forward. We had numerous conversations with council about our capital project needs and previous councils. You know, every time we issued it is a tax levy increase. So, we just have to really manage our tax levy increases. And so, when we get to December of 2021, um that authorization to sell the one in yellow, um we have five five votes for that. And that's what you'll see in as we go through this um is that the five votes is what it's in normal chapters 14 through 17. Um but what isn't clear is in the green when we get to the award time frame. So between December and March um we're going out for project bids. We've got we've hired consultants. We brought all of those in. We're preparing the official um investment document that goes out to the market. So that is out in the market. We're getting credit rating agencies and those are costly. Um all of that's being done until we get to that March date. So we've received the ratings. Um and we're in the market and it's the day that everyone's bidding. Um so we're going to take the lowest responsible biller. It's and they're all pretty responsible people. So organizations. So we we tally that information and we bring to the council that night. So what we're wanting to put clarity in um the charter is that at that point council's already authorizes to vote to bond. We're just approving a low fitter. So at that point we're looking for four votes. And so that's the pieces that we're putting into the agenda items as we're moving forward through that. So this is just the timeline for just a fire station for Everybody knows what CIP means. >> Capital improvement plan. And >> it's a normal convention. If you use an acronym, you explain it the first time you use it. >> I can do that. Um, moving on to the different types of debt. >> This is a pretty wordy of this. So um chapter 4 7.14 is permanent improvements bonds and those we use that for in our payment management program for the reconstruction portion. So there's many pieces of our payment management program but the reconstruction is where they're really digging into the ground. They're removing stuff and it's taking um months to get back to your driveway. I think several of you have been um impacted by reconstruction. And then um we normally would issue that in the fall and um it's not only in our charter but it falls under statute 429. >> Um so it's in both locations and then um taxicipation um pieces that are both in our charter and it's allowed under statute. the city has not used either um chapter 7.15 or 7.16 in well over 25 years. Um but we need them just in case. So um tax anticipation certificates would be something that we could issue in the spring in anticipation of our first property tax um portion come from the county. We are only pay twice a year from the county. People pay their property taxes twice a year. So, the county um say you pay your your taxes in May. >> Um June 20th is the first day that we would get 70% of what was paid in May and um then we would get the rest of it um about 4th of July and then we get the other half December 1st. So, we only get paid from the county on our tax levy twice a year. So, we have to manage our cash flow. organizations other than us might use that anticipation. Um, say they're going to get $10 million coming in in June, they might issue $2 million of anticipation and pay it back within 90 days or so, real short term after they get that tax dollars. Um, emergency debt. Um, for example, on that one, if all of a sudden a storm came through and it wiped out several pieces of um, capital improvements and things like that, we could issue um, emergency debt certificates, and that would get us the ability to start building something or moving something in a short period of time. Um, but in that one, it has a two-year duration, so we could only have those bonds outstanding for two years. We could re um I'll call it refinance those like someone might refinance their mortgage. We could re refinance them at that two-year mark and put them into a different type of um structure. But that's how those two would um sit out there. Um in 2015 is where the charter um worked with finance to create this chap this piece of it. >> Um that's the last time you were here. >> Yep. Last time I was here. general obligation charter bonds. Um, and it also limited the amount of net debt that we can have out there. So, um, I'm not going to go into that one because that one's really um, a lot of details on the limited debt. Um, but it on this particular one um, >> is a charter bond different than a general obligation? >> No. Um, it's a type of bond. So, all of these can have general obligation in front of them. We can and the general award is means that we are pledging our full faith and credit over a tax levy. >> So what's the distinction that charter adds to it? >> We can only issue these for non-essential um government projects. So I would say under capital improvement plan bonds those are fire, police, public works, anything park related or um that type of thing. Um I I would say we issue charter bonds um for the community center a portion of the community center bonds are charter bonds because those are recreation and we can't use recreation under under capital improvement bond. So it's what kind of improvement defines what type of bond we can issue. >> I'm assuming like any business we have a credit line right? >> No. >> Yeah. >> We do not have a credit line set up at a bank. That would be the tax anticipation certificate that was ever needed. >> If we needed that, but if we're planning well um we don't have have necessary needs for that. So on um in each one of um chapters 14, 15, 16, and 17, we are looking to make add clarity as we're going through those to make sure that any authorization to vote or to actually issue the debt, it's going to be five votes to the council. Any award is going to be four is what we're looking to go through that um >> for all of them. >> Yep. And then I'm just giving you a list on the other side of other bonds that we've issued over the last 20 years. We've issued the the sales tax bonds. Um and so um we're issuing our third portion of that for the park and recreation piece for the Nine Mile Creek um on February 2nd. And that will be the third and final piece of the sales tax bonds. Um the capital improvement bonds, we are also issuing bonds again on February 2nd for the public works garage on that particular one. the utility bonds we um those are almost I would say three to five years apart. Um so that might be a sewer improvement, it might be a storm water improvement that we don't have um enough reserves built up to pay for it in one go. And um so those are those um we've had a couple housing improvement um has um and so um the most recent one is this fall for the heights and condominiums the 30 unit condominiums we issued approximately a million dollars of housing improvement bonds and that type of bond it is 100% um assessed to the owners. So none of the liability of that type of bond is on the tax levy of the city of Lington. And then um tax increment bonds are financed um predominantly with the tax increment that we can generate from that project. And then um lease revenue bonds um we've only issued that a couple times. The last one um and we work with the port authority to issue those. And >> that would be all of those ones underneath that. >> Can you go back for a second? Just to be clear, um, like I'll give you an example. I have I have my investment account in Fidelity and Fidelity set up where it emails me when there are bonds in Minnesota. And so if if the city council on that night that Lor talks about selects syndicate that includes Fidelity, the next day I can, you know, from Fidelity that says, "Hey, we have bonds available from the city of Bloomington." And so each of you could go and buy I think there are5 or $10,000 >> generally 5,000 increment 5,000. >> So it's these these are literally something where you could on the other side of it you could you know if you have some money and you're looking to make money as a you know kind of on a tax the income tax you can go buy these bonds. >> That's the beauty of it. Yeah. >> And then if then if Glory doesn't write the check you know who the person is to call >> you get paid. We're the fiscal agent and we they handle all of things, >> right? >> You know, the on the other side of these bonds, it's it in the end it's almost always people on the other side. It might be like a like a family that has somebody managing the money or it might be buying them, but it's not it's not like a lot of big super remote people. It's a you know, it'll be a lot of people in So, >> anybody can buy them. >> Yep. Anyone in um but they generally have to work through their underwriter. Um >> you can't come to the city and buy them. No, no. You have to have a fiscal >> consult. Some of these bonds are not addressed in the charter. >> Correct. Um >> like tax increment bonds. >> Um those are all authorized under statute. Um and these other than chapter 17 where it it's cloudy at the statute at the state level what we can do with that. So we wanted to make sure when we added chapter 7.17 that we were very clear what we could do with that. The rest of these are very clear under state statute how they work. >> And do all the statutory well all the bonds are evaluated against the 1% of market value? >> Not all of them. So um for example I'll I'll highlight the ones that are not right now. So the first one chapter 14 or 7.14 because it the combination is tax levy and special assessment it is not part of the 1% um 715 and 716 would be part of the 1% should we ever issue them 1.17 is part of the 1% sales tax because a sales tax is pay not not tax levy it's not part of the 1% the capital improvement bonds, it's part of the 1%. Um, utility bonds because it is paid by fees and not taxes or um assessments, it's not part of the 1%. So, we we are tracking internally every piece that can be part of the 1% and making sure that we are staying under the cap that um this committee commission established. >> What is the answer to that? So under state statute um we take the city's market value and under normal circumstances um our debt cannot exceed 3% of that. What was established here is we cannot exceed 1% of that. So we even we really limited ourselves and we're not anywhere close to that with um what is in our capital improvement plan over the next 10 years. I can >> part of my job to make sure we smooth it out so that we don't ever come. >> And for those of you who weren't around when we had that conversation, because Ronald, you were clearly around when we had that conversation. Um, >> we had we had quite a we had quite a bit of conversation about what that right level was. And I think there was a feeling generally among folks who've been involved for a long time that that 3% number was wildly high for cities and that we wanted we we wanted to kind of force the the city council to be more smooth about spending on things like that and that so we set that lower in order to for the reasons that Lori >> Yep. I mean as part of the AAA to be as conservative financially as we can be it's a good thing. >> Sure. >> Yeah. All right. So, um, as Lori has mentioned, a couple of these statutes at the end here, or excuse me, sections at the end here are the ones that are, um, specific to the amendments that she was referring to, but we have a couple to get through before we get there. So, let's jump in. Um, this 7.01, 101. Um the the main thing I wanted to highlight for you here is the who and what this section is saying is that the council is the entity that controls the financial affairs of the city. The council um makes the has the high level the policym control over the city's finances. >> Okay, >> any questions? Right. This one's pretty straightforward. Um, our city fiscal year is the calendar year. Um, other entities have different fiscal years ending in September, ending in July, whatever. Um, but at this particular organization at the city, it is a calendar year. Any questions? Next. Um this particular section 703 uh I wanted to highlight again the council is the entity. Um the the vehicle by which taxation is occurring is by ordinance. Uh and this requires uh this section of the charter requires that the ordinances and the the regulations that the council adopts have to be consistent or not in conflict with the state constitution and state laws. So when you heard Lori previously talking about state law says this, state of law allows us do this, but we have it still in our charter. We have it still on and we have a section in our city code related to um finances as well. Um that those have to be consistent with state law. We can't do um something different um that is inconsistent. All right. In that in that view, why does it say FOIA is possible? Either you comply or you don't. >> Well, I I I don't know exactly why it says it, but my guess would be that there are times when state law is silent on something. Uh, and you can't be inconsistent. You can't be in conflict. So when I read this section, the first thing that comes to my mind as a as a similar thing is election law. We can't be inconsistent with election law. Like we can't decide that that the we're going to hold the the federal election on, you know, November 10th or something. We have to do it the same day as everybody else um in the country. Um that said, we do have some flexibility on how we manage our own internal elections and that we are doing rank choice voting, but we're following all these other sort of general election laws. So here they're saying we can't be in conflict with the state constitution and the state law, but you have some room within your own internal city system to adopt ordinances to implement your particular process. All right, any questions? Any other questions? Right, next one. 7.04 the board appeal and equalization. Um, this particular group um is the entity taxes go out and people or um assessments go out and people can appeal their property valuation. And this is saying that the council or these designes serve as that board. And in the city of Bloomington, it's it is a separate board um that serves as that board of appeals and equalization. Any questions? >> Right. Next. glasses on for this one. All right, this one is saying 7.05 preparation of the annual budget. We just completed that process um uh in December. Uh and we have a slide the next slide um uh an upcoming slide gets into greater detail about that process. Um but essentially it's a months many months long process. Um this uh this particular section charges the city manager with the responsibility to prepare the estimates to the council. Um it requires that the budget be organized funds which when you're if you ever tune in to those presentations you'll hear tonight we're going to talk about the the utility fund. Tonight we're going to talk about the other funds. You know they're organized the budget into funds and we move funds. We assign um the money into different buckets into different funds. Um the council can establish or dissolve funds except for the general fund. Um expenditures come out of these funds and I mentioned um each department draws down. We have our own budget by department and we have to come up with these detailed uh and we have a lots and lots of policy books that Lor's group um works through on how our budget moves throughout the organization and how we account, how we balance, how we pay things, um how we um budget. Um you can see the other language here and decreases and then the box is black. Um there are revenue statements. Um and I think the thing that I wanted to draw your attention to also um on this is that second to last sentence about how estimates have to be transmitted at the first regular monthly meeting in September and they have to be public. Um I wanted to make you uh highlight that in particular because I wanted you to know that there are some specific timelines in our charter. Um, some of them are very specific and some of them are more general and um, our finance um, department and Adrian um, they have mapped and calendared all of those deadlines and communicated and reminded everybody and calendared all those things to ensure that we're always meeting those deadlines about those deadlines tonight. But I just wanted to to highlight that one for you in particular. Any questions on this process related budget slide >> when when kind of you're done with presentations in the summer effectively the cumulative kind of effects of the budget process and you kind of are meeting that that September deadline about how many pages of budget material would you say that submitted to the council at that point would you say across all the funs everything. >> Um I well >> what's your guess? >> I would say first um there is a general fund and in the general fund we have pretty much departments and um so for if they were to just look at the I'll call it the historical when you were on council we had paper packets for the council for all those. Thankfully, we are now digital >> um because um every Friday they would get a packet delivered to them of a mountain of paper. So um um that would the 200 pages might just be the police budget. >> Um so in general um other than the general fund, we bring 30 other budgets to the city council. So that they have a lot of papers, they have a lot of summaries. Um try to um bring it down and condense it so that when we're presenting that they know exactly the pieces and the longer they're on the council, the more they know exactly what they're looking for. >> Other questions on this? This is interesting because it's very very that >> which a lot of things we delegate the council to set the process for things but not this. It's very this is very structured in our how many bank accounts do we have to keep track of the funds. >> Uh majority of our banking is at US Bank. Um we have probably two other locations that we um maintain dollars. Um >> but each fund does not have a specific checking account or savings account. Um I would other than a couple of um I'll call it our special revenue funds and especi um that are federal um public safety related where I'll call it um JP um sorry JPA or um >> no some of the the police ones that they have that are federal they they require um a separate one like a justice department one. >> Yeah. So we have a separate bank account for and it's little dollars that come in and because they want to know that exactly what their account earns. Um the rest of the dollars um we have a poolled investment fund and then it's swept and we invest um at a global level but every department director knows their budget code. Adrian and I work on a legal budget 125101 and no one goes. >> Yeah. Um I'm wondering Adrian, can you bump ahead to 17? I just wanted to it's the >> Here we go. >> Thanks. So, um Steve specifically requested that we include sort of a a picture of the overall process in in the um presentation and I thought this was a good one to use because it shows you that essentially we're working on the budget and Lor's folks are working on the budget three4s of the year. Um, so it's not something like that we start working on and then we sort of put it on the shelf and dust it off again towards the end of the year. It's something that's continuously um there's assignments and projects and um things that are happening um both internal to the city as well as out in the community. >> Yeah. And just to give a little bit more that the PBB that we didn't um delineate what that meant um we started a whole new process called priority based budgeting. So um every single one of um our activities had to be um defined and scored and um a lot of departments spent a lot of time um trying to understand that and put it into context when we put that together. Um so that was a lot of work this year. Um August 18th we had a study session and um two previous council members remembered study sessions where we talked about budget in August. um this particular one for the first time we actually um put a public comment or um where people could come and comment about that. So it's like another public hearing um but they could just come comment on it. We had four people come and talk about that. Um September 8th is the first regular meeting of September and we brought the preliminary tax levy and per statute we have to approve that tax levy in September. per our um charter, we have to approve it um at the first meeting of September. Um and then we gave um more information to council all through it. Um again, we had probably on the 24th of November another public comment opportunity and we walked the council through where we were at the tax levy portion there. Um we get requirements through the county and the state on when we have our truth and taxation. We could have had it either um the 1st of December or December 8th. Um there wasn't a lot of time between November 4th and the 1st 24th. So that we um moved it to the 8th. Normally it is the first Monday of December for the truth and see >> and then the council approved it on the 15th. We were looking to hopefully do it on the um 21st of December, but we ran into a problem with the third week and you'll see that coming right up. >> All right. So you want to go back again to 15. All right. So 15 here um our slide 15 section 7.06. This is the passage of the budget. Um in here you see it has to be the principal item um on the first regular monthly council meeting of September. Again another one of these dates. Um uh citizens have the opportunity to be heard. Um and it talks about uh the detail level. Uh it talks about the total sum safely less than the estimated revenue. Um and then you see here that the council must adopt the budget by the by resolution not later than the third week in December. Uh and it must also adopt a resolution levying all taxes. So you've got the the budget and the levy, two separate resolutions. Uh has to be certified by the county auditor. um and um has to be for the uh appropriated only for the purposes named in the resolution. So um you see dates, you see specificity again here, you see specific methods that have to be done, you see tests safely less. Um any questions on this? Just to give you a little bit more on the safely less we pal we pass a balanced budget meaning our revenues and our expenditures do equal but in our expenditure section we have a rule to increase um include contingency which is 2.5% of um the the rest of the expense will have to be our contingency so um and so other than other cities and other locations like you might hear about Chicago and that they don't pass a balanced budget um Bloomington The other thing I point out because I think it's relevant to the conversation we have that we're going to have about the date in just a second is that if you think about that uh picture that we have with the boxes on its along there, the the closer you get to the end of December, the harder it is to change things. So it's it's I wouldn't say it's easy, but but it's more funable in August, more changeable in August >> than it is in December. in December, you know, the the divorce has really left the barn at that point on things. >> Well, yeah. In Egan, we had a guy come in and done our truth and taxation hearing being like, "You need to slash $2 million." And the mayor's like, "Well, you should have come in August." We can't slash $2 billion the end of the week. >> And and time you if you have questions on budget or things or or you have ideas that should where could we cut, please send them to finance and we'll explore them. All right. So, getting to the the um and you'll see in your packet that all of these slides that are discussing a proposed amendment, and again, there's a fair amount of repetition as we move through this, but they're this blue color, this light blue color. So, this is the um in conversation with finance um in LIGO. they we worked through a couple of edits um to address some opportunities for enhanced clarity. So in this instance um the third week of December, you heard Lori talk about um wanting to bring the budget on December 21st. Um well, we have run into a batch of years um that have fivew week Decembers. And so the third week of December ends up being earlier. Um and and frankly more ambiguous than um so like when do you start counting? Is it is it from the first like if the first is a Thursday then does week two start on the 8th or you know or is it like you look at it by line? Um, so there's a lot of different opportunities for um, ambiguity and we wanted to diminish that because we wouldn't want something ever to be as important as um, the budget process and the levy to be called into question as not being incon not being consistent with our charter when that was never what we intended. And so we talked about a couple of different dates and acknowledging the realities of you're never going to have a you know public I shouldn't say you're never going to have a public hearing but this you know truth and taxation is not going to be on December 23rd. It's not going to be you know like that that's just not the reality of the timing on this. Um, but we were looking for a specific date and you saw that chart, right, the boxes. And so we're wondering what your thoughts are on December 23rd um as a possible clarification to this section as compared to using the third week of December. >> I think it makes >> think it's clear. >> I think it makes sense. I mean, even just looking at the calendar, it's it it makes perfect sense like 2031 >> versus 23rd as a >> could vary. I think >> I think it gives specificity and time to balance out because again, you looked at Yes. this year we we couldn't have done that. >> Yeah. Yeah. >> Well, we ended up having to >> we had planned it for the first and we moved it to the 15th. >> Yeah. >> All right. >> Anybody else have a comment on that? that change. >> Okay, great. Next slide. And then this we talked about here. Slide. Okay. So, this is about the enforcement of the budget saying the who the city manager is in charge. Um, again, as a reminder of the from a couple years ago, we have a city manager form of government here. um the city it's uh the city manager is essentially the CEO of of the corporation and again as a reminder this city is a home rule city but it's also a municipal corporation. Um all right so going back to the the text here in 7.07 the city manager it says cannot approve um any order upon the city CFO for an expenditure unless um it's been approved by the budget resolution. Um and um so long there has to be enough money, right? So these are very basic things. Um and then it re it references that chapter 6 um that we talked about last year um about who can make the purchase and how that purchase can happen. That 6.06 and 6.0 excuse me 6.07 6.8 we're talking about signatures and authorities and execution of instruments. >> Any questions on this? So, I'm trying to remember we're in the pandemic year in 2020. Did did this end up getting triggered at all with needing to make like budget adjustments to make things happen? Do you remember we had anything like that? Was that pretty much able to be taken care of under the >> um in 2020 when um for example in 2020 70% of our lodging tax revenue did not come in because of COVID. Um I would say at that point the budget had been already set for 2020. We just stopped spending in a lot of areas. Um and as we moved through 2020 and had uh um the committee and helped us um cut budget activities for 2021 budget process. Um there's just a lot of things that we didn't spend because we didn't have the revenue to spend. So, um, >> right, >> the council can also at any point, the city manager can, but as we're moving through here, the council can approve alterations. I'll call it budget adjustments, but the original budget is the original budget. We can always have an amended budget. >> This is not a substance importance, but I found it odd that uh that word order uh was used when it's either you requested it or uh by or from I the word upon doesn't seem to fit. >> I don't order upon >> it doesn't really matter. I guess >> this could have been created back in 88 >> must have been different. Well, >> anywhere. >> You You think that the uh meaning is clear? >> Mhm. >> That's fine. >> I guess. Yeah. >> It's just odd. >> Yeah. Well, there are some odd terms of phrase and let contracts and things like that. Yeah. Anything else on 707? All right. 708. This is um what Lori was just referring to, alterations in the budget. So, after the council has adopted its budget, um they can't increase um they can't just pick a new number. Um uh but they can move money around um by passing a resolution. Um and um you will most often see this um an example of this when we receive grant funds. um when we receive grant funds, we have more money coming into the budget and we have to put it into a fund. And so there you'll see this as a part of that resolution that's acted on by the council. And what this charter commission what this charter section says is that in order to to do that shifting of money, um you need a a bigger vote than a majority vote. You need a five five member vote um to do that. And one thing to just note in this charter um and in our code also is that sometimes our and we've talked about this previously there will be a very specific number. Uh and so that is how many people you need to say yes. Um and so if you don't have five people there, you can't take action on that item that night. Um and then this and then it also goes on to say that the city manager can can move things around um within these major classifications. Um but >> do you want me to give you an example of that one? >> Great. Go for it. >> So um an example of that one um our major categories are wages and benefits, materials and supplies and um capital and debt. So in your materials and supplies in my fund the finance portion he can move it from one supply line to a material line. >> That's it. He can't move it to in finance to salary benefits. He can't move it to capital. He can't move it to debt. He can only do it in that very small window of that type of budget. And so he can't move it between departments. um it can only be within that department's line budget in that type of category. So very specific that he has the ability to do. >> Any questions? The other thing I'll point out is when I read the the five member thing there, what that that kind of blocks is the council like let's imagine that the council adopted budget with four bugs and and and people came and testified and supported the budget and then they decided to kind of switch it and do something completely different. It makes it harder for them, not impossible but harder >> for them to do that. That's what that's the way I vote is there. >> Yes. Any changes needs. >> Now, practically speaking, in my experience, all of the things nearly all the things that came to the council movements like this were kind of routine things and they just the council just said, you know, they they they make sense. You know, I'm sure they don't had to move the money around. So >> yeah, we put it it's in the consent agenda area, >> but they're they're they're basically those those movements are never controversial at that point. So >> generally not. >> Yeah. >> Yeah. Anything else? Next slide. >> All right. Emergency appropriations. Um there's a it's again it's the who the council. Um and it can't exceed 10% of the total approved budget. um a transfer again you see this vote requirement at least five members and only for the purpose designated by again the council any questions in an emergency you might say what is an emergency Lori referenced a couple of them um it's not like you know the cost of living went up more than we thought it would by 1% it is you know something catastrophic Yeah. >> Is that 10% number standard across the other cities? >> Um >> I I don't know what other cities have, but we have not utilized this um charter item in while I've been here. So, and Lor's been here for 23 years plus. But it just give an idea what what would that 10% number be based on the current budget. >> Um so right now the general fund budgeted is just over hund00 million. Um but it depends on where they want to take the dollars from. So if um if it's storm cleanup, we might utilize look at one of the utility funds and look at what we have in the reserves and that and they might um do an adjustment where we're utilizing those reserves to fund their emergency. Um so we would look at if the emergency happened, what kind of it was and then we go into and look at all the different pieces that we could pull dollars to help um what we need to do to fix And so the $10 million like those emergency tax certificates. >> Yeah. >> Um $10 million like you need a $10 million you would just take money out of a pocket to say you had it spend 10 minutes. You don't have to go borrow. >> We would have to borrow it. >> Oh, it is the flu system. >> Yeah. Sorry. Lori and I are both recovering. Um sorry, I didn't mean to ouch you, but Lori is okay. I think I coughed already. >> Yeah. >> Um um and I would I would also say that when we use the word emergency, I think sometimes um you know people wonder like what does that mean? So we also have other process um within our within our regulations and within state law about declaring an emergency and um we have as a city declared emergencies in the past. And when you do that um you have it has to be defined and then it also triggers the ability to do other things for example some different contracting and procurement and things like that but it's not something it's there's process involved in it the mayor gets involved there are time limitations um in our in our current structures. So just to be clear like it is there is process. It's not something that can be flipped on um without any um uh without great thought and intention and discussion and then the if and then the council has to get involved and so there's a lot of process. I'm happy to talk about it further at the next meeting if you'd like or if you have any other questions on that, but I just don't want to um sort of underplay the the bigness of the term emergency. For example, we can have an emergency council meeting. Very rare, but we have had unfortunately in my ten years here have had to have some emergency meetings. Next slide. >> First Helm made. Um so I'm going to start this slide and then turn it over to Lori. Um this is talking about basically how we how we pay with city funds here. Um and Lori's going to explain a little bit more about some of these more nuanced um terms and then we have um a proposed amendment for your consideration as well. So under negotiable instruments um do you want to oh sorry I can go ahead no that's the next >> um so um this says that when you make dispersements um by let me bet a high level back up and say some of this language is just a little out of out of step with with 2025 or 2026 or even the 2020s. Um, and so when Lori and I were looking at this, um, we we realized that it it isn't considering some of the more modern ways that we disperse funds, um, in in in this current world. And so we we have some ideas about how to improve it with regard to the variety of things that are currently in modern ways of moving money and making payments. Now, um but what this also does is um talk about the requirements that must be in existence in order to make payments. Um the ways um that you have to prove out payments. We have a very robust system of itemization and and proof um of of what you're spending the money on um and the the proofing that's required um when you're wanting to draw down city funds. Um, I think this is important to mention given all the things that are going on um in um in these times and so just to let you know that we um take this very seriously at the city and um have man mandatory training and um and and things like that. Um uh particular funds have to be um attributed to each dispersement. Um, every time Adrien pays a bill for the legal department, he has to write down the specific fund that it's coming out of and um and and that matters at the city of Bloomington. Um, and then at the at the last line here, you'll see that the council um is the entity. They can um make additional regulations and those regulations are by ordinance and um and you see many of those. I believe it's in chapter four of our city code. Questions before we turn it over to Lori. >> Do you include credit cards in that? Do you use credit cards? >> Um it's or not? >> I would say it's not really a negotiable instrument per se. Um in that definition, um a credit card um is not something that you can transfer to somebody else to use unless you're getting in trouble. Um, so it's um, you know, it could be a check. You could do that type of thing. Um, it does say, you know, a bill of exchange, but that's pretty rare. Promisary notes can be exchanged. Um, bonds can be exchanged. But >> yeah, in that section of I've been in now for 40 plus years and I do not remember any event where it hit the paper or the local street news or there was a misappropriation of funds. That doesn't mean that perhaps there was a wasn't a bad character someplace along the line, but I don't ever recall anything that hit the news and in part it's because of the firmness of this particular section. I I would say um people um sometimes they'll take um a check and wash it and um you know what we've seen all those type of frauds and they'll try to pre present it to the bank. Um and I would think um Cynthia would jump in here but um we have a number of safeguards that we have right at our bank account to check um the the amount the number on the check the pay on the check. So we are following every specific thing for fraud prevention that our banks allow us to do but people try to >> sure >> do it. We see it happening. Um it's really just you know what can we negotiate um on those things. So, in the um item that we have before you on the if you want to pop over to the next piece um the you know we're changing um city divers from can only to a must. Um and then we're looking at um electronic fund transfers under state statute. Some of the rules change that we have to actually put it in um an agenda. So, um, as part of our normal organizational materials for the city council, the port authority and HA, we now have an agenda item that lists out the people that have the ability to do the electronic fund transfers so that it's um, very clear who has that ability and, um, we have to follow this type of thing. So, um, one of the things that is not in here and we want to make sure that, um, no digital currency is listed here as a, you know, type of movement of money. So, um, none of that coins or any of those things are listed here. So, um, and then we want to make sure that, um, all the dispersements again spec specify the budgetary fund and, um, when needed, we actually get down to more of the the or code and the specific, um, line item codes on our transactions there. So, um, those are some of the pieces on there, but item B on there, um, that agenda item was before the city council, um, last week. So, some of this is cleanup and then some of this is adding the EFT on. >> Any any questions? Any thoughts on this? I just I want to follow up because there was a question before and it's not as clear but um for the pecards that the city has how how do those are those personal obligations of somebody until they submit for how does that end up working >> one it falls under um they can't obligate the city for spending more on their pec card than what's allowed um so it would fall under one of the previous items on here um and they can only spend from their specific budget they can only spend pieces that but it's just not a negotiable item as as credit card. >> The reason I'm asking is that you know when and so for people who aren't familiar with it there's a you know businesses oftentimes you know there's two kinds of systems that businesses have. So like when I worked at Microsoft I got an American Express card >> and it said Microsoft on it but it wasn't Microsoft's American Express card. was my American Express card that the company paid for and I was responsible for paying the bill and I submitted express. >> Y >> they gave me the money and I wrote a check to American Express and paid it off. Um >> um through here we utilize US Bank for our PE card program and um we I would have to say you know just tangent wise we've done a lot of training to make sure all PECART holders they um recently had to sign new compliance agreements um and and their approvers had to sign new compliance agreements that they would follow specific deadlines and dates to make sure um when they're entering data into the US bank system not only do we have the correct receipt that they have to put uh in the common area the right um information to match um in another area here our public purpose policy that we are only spending what is we can under public purpose under state statute. So >> I guess the the contrast I was trying to draw between the American Express card one one could argue that the process of presenting the card for payment is a dispersement because it's obligating the city to pay >> yeah I agree with that. Um, and so I think at least my opinion is I think a little bit of thinking needs to be put into process around the pecard scenario. I think the PECAR's a very reasonable way of handling small expenses in the city of stuff like that. So please don't take it as like a cards because I think they're a great thing. >> Um, but I think this this doesn't really consider guards. We need to we need to think about that in this section. We're clear on that. Any other >> I just have a language comment on the last sentence. I don't like the changes. I think eliminating the the safekeeping and deser dispersements of city funds. I think it makes it a little less clear. I think it takes a leap of the reader to if you read just the city can make additional regulations by ordinance for safekeeping and dispersements period. I think it takes a a step in the reader's mind of safekeeping and dispersements of what and you're like, "Oh, okay. Yeah, the ordinance is about the city funds." So, oh, it must be. But I think if you're requiring the reader to do that additional step, it's um a burden on the reader. It shouldn't be there when it's just we're just talking four words. I would keep those in. And then the other thing that's not precise with the language. It shouldn't be the council can make because can can also be ability here. This is the the discretionary authority. So it should be may make. So those are the two linguistic changes that I would suggest. Great. Anything else? I had a question about the removal of the and signed and kind of the middle section >> and signed >> approve approved and signed like kind of the thought behind that removal and >> what the definition of approved means. >> Um and signed um we are um when everything is online now so if we get an invoice it's online. So um >> like an e sign >> um even e sign it's a a process to do um docu sign on every piece of this and so um some of them are dollar levels um at different levels where people can approve um it depends on how much workflow we're going to put on for every single document for dollar amounts. So right now um if they have the authority if they say for example um the council approved us um the contractor for big you know received this much um and the council's already approved that we can spend that much do you want every invoice for that contractor that's we've already approved for signed or council has already given us the authority to move that through and pay those bills. So, anything over $175,000 has to go to the city council to get approved. >> Your system keeps track of the fact that somebody couldn't be approved, >> right? So, it's not it's not like there's some mysterious process where >> and we know who and when. >> So, when it's not it's not signing in the docyign sense. >> Yeah. Yeah. >> So, this so 7.10 is for all dispersements regardless of any dollar threshold. Is that correct? >> I think this was much more in regards to um you know as we looked at a on there negotiable instruments and I think it was just terminology was um in regards to that area and we added electronic fund on there um you know and and if we need to add to cover all type of expenditures like PE cards and stuff we'll just add a C on there and describe it. >> Okay. But I think to your question today, if the city needed to pay vendor $25, this applies to that $25. If it's not a PE card thing, if it's if you're going to cut a check, >> it falls in this. There's no there's no, you know, bottom to >> Sure. Okay. Section B just came because of how statutes changed in regards to um clearly defining that we're, you know, because I would say most of us have had direct deposit of our paychecks for years. This is telling us that who has that ability to move those things that way. >> Okay. And then just one other question on a um it talks about faximile signature. So are they allow is the mayor allowed to like electronically like docu sign is faximile covers that as well. >> Um when we um create a form US bank has a form because they're our main bank. So in that piece of it, um the mayor's signature, the city manager signature and my signature is there and that faximile is then put into a computer and as we're doing a normal um if people are actually getting a payroll check, that faximile signature would be on there. If they are getting an actual vendor payment through our accounts payable system, they would get that veximilly. So faximile is embedded in the software as we're printing the check. Yeah, that's pretty common. >> That's why we left Million on there because it really does reference what we're doing. >> Other question. >> So, we've got some proposed amendments here. I'm interested in getting people's kind of reaction to amendments. I think we heard a little bit of feedback on the last sentence and personally I'm fine with that. Other other comments about the changes? >> Is there any specificity needed on the approved annually by city council in terms of timing like where this would fall within the kind of regular count? >> The first meeting of the year we do a a I'll say a whole host of organizational ones. So they um for example they have to approve the banks. They have to approve um our auditor, they have to approve um newspaper, >> our municipal advisor, they have to um and and then we bring those same group of um organization items to the HR and the port. So they have to approve them also in totality of all those things and our auditor will check that they have been approved every year. >> So this would be one of those approvals. >> Yep. This is one of those approvals. You do get all that. >> Yeah. >> So there's no need to specify like first meeting of the year with that. >> No. Yeah, they all it's all the first meeting of the year. Yeah. But that's a good question. >> Anybody have an objection to going forward with this with the one change so far we talked about? >> Okay. Onward. >> All right. 7-Eleven. Um they this is again talking about the general fund which Lori has mentioned previously. They must maintain a general fund. Um again we've talked about the levies and the money coming in. Um the second one second subdivision they must maintain all other funds. Lori mentioned there's how many other ones? >> Um there's there's a lot of funds. We we actually bring 30 plus budgets and those are at a fund level. Um >> uh so we're maintaining the general fund and then these other specific funds um as the budget requires the city manager and council direct or required by law. This is the essentially the the section that says you have to keep funds and you have to have at least a general fund and you have to have other funds. >> Any questions? >> You are clear about what those other funds can't do. It's quite would be useful just to kind of talk for a second. >> In um governmental accounting, you have your general fund. Um and over time things have changed. We have special revenue funds. Those tend to be grant related funds. They're very specific restricted p um purpose type funds. Um one of the ones um Steve might recall is uh we have a fire pension fund. Um and it's a special revenue fund and we send tax levy there and it um it's a city fund. It's not part of the um fire relief association that the fire um relief has um but it is how we can manage um our pension obligations that we are required annually to pay to them. So um um by setting up this fund and it's probably been out there um well over 10 years um that we've had this probably since 2012 um or a little bit earlier um we had run into I would say 2009 2010 there was um market adjustments and um we had to pay um several years I think it was three years in a row over $3 million each year to um pay our pension obligation and So, we were um trying to find the dollars to do that. And at the same time, we were we set up a process to levy some and use some strategic priorities. And over a five-year period, we stopped using strategic priorities and we're just levying and we're at a nice reserve level there to manage um our annual needs of um obligations. So, the good part of that is that we we watch the fire pension. Um the council member Lman, the fire chief, and I are also on that board. So we watch how they're managing their money there. But um that would be a fresh revenue fund. We have debt service funds. Um so every bond issue that we have we um set up a debt service fund so that we can clearly watch how the dollars flow because you know as we're looking at you know one of those um final um columns in the calendar of events is that we have postisssuance compliance on every bond we have and every five-year mark we have an arbitrage calculation that if we earn too much interest we have to um send that off to the IRS. So um we watch how we spend our bond proceeds um very closely. So and then we have enterprise funds and internal service funds and um yeah those are the main ones. >> Is there anything that dictates how much has to be in that fund through >> general fund? >> Yeah. >> Um the general fund um in any location is the main operating fund. So it it depends on the needs of um and what the council's appetite is for um what we have there. >> So it's driven by the council. >> Yeah. >> But to to Lor's point like you know in a lot of cities that general fund is primarily funded by property taxes. you get paid twice a year. And so there's like an example that we used to talk about is the like right now the general booming with is flush that's booming with cash because all the taxes are in for last year and but it's got to last until kind of May June. >> It looks like there's a lot of money around at this point >> and and and the normal um cash flow is it it dips down but we we don't go below a certain amount. We watch where that's at and it gets replenished um in June, July and then it, you know, it's up there and it comes back down. So it's it's a normal wave pattern for when we get property taxes. Right. Next slide. As we mentioned a couple of times, the who is here um and you see the term chief accounting officer. Um Lori and I were discussing there's no like there's no legal meaning to this term. um it's more of a general term in that the lead um person position in charge of the accounting um for the city the CEO there's no like CAO just to be clear um and then so they're saying the city manager is in charge of the um accounting of the city's funds and then the council can establish and infor let me back up and say one other thing we had some discussion about whether instead of saying city manager, this should say the chief financial officer is in charge of this. Um and um we ultimately concluded that we should not recommend that change because if you look at the duties of the city manager in that city manager chapter of the charter, it specifically talks about um the city manager's responsibilities including duty. So, we are not recommending that change, but I just wanted to make that clarification in case you're wondering sort of why um because other people we have we were ask all all of our department heads and and leaders to read the charter each year. Um and that question came up. So, I just wanted to to mention that. Um, and so then moving on to the second sentence, >> just one thing on that, you know, for for people who are newer at this process, but the the charter really is focused on putting as much of the spotlight on the city manager as possible. And so if you if you read the charter as a whole, it says the city manager is responsible for this. Obviously, they can't be responsible >> in detail for every single thing like that, but the the whole concept behind statements like this is that that there's no fingerpointing. It's the city manager's job to make sure that this is done correctly. And that's that that goes through the whole charter. It's not just in this section. >> But essentially, I mean, how this one would work is, you know, finance has to accumulate all the data and we walk the city manager through everything um before um we send out the report by the end of >> February. So, he knows exactly where we stand. Right. The second sentence, um, it's the council that establishes and enforces the methods and the forms and the payments and the and all of those things. I mentioned previously those financial management policies, those have to be approved by the council. Um, when we make changes, when we recommend changes to them, those recommendations go to the city council. um oftentimes on the recommendation well the functionally on the recommendation of the city manager um and um they get into minutia at a high level and um spec level as well. So, they're talking procedures, um, uh, the public purpose expenditure policy, the purchasing policy, the PEC card policy, the I mean, all of those types of things and topics that you all have referenced tonight, those are, um, approved by the city council and they're also on our website. >> Yep. Currently, there's 25 different policies when underneath the umbrella of the financial management policies. >> All right. And then at that last sentence there, you see another one of those gates. Um they trans the city manager must transmit a report to the council covering the operations of the city of the past year before the last date in February. All right. Any questions on this one? 712. Okay. 713. Um this is um city indebtedness and um this begins our our section of um of those parts of chapter 7 that we're going to talk through with more detail on um the timing of or the vote count on the different parts of the timing of the process. Um but this is one is more general. Um and it says that no obligation can be issued to pay current expenditures. Um but the council can issue and sell obligations. Oh no, excuse me. Except as otherwise provided. Um the council can issue obligations for purposes that are lawful. So they're saying like the city can issue debt. Essentially the city can issue debt. Um, and then they're they're also talking about um the vote requirements. Um, in some instances you'll see there's um an election requirement um or an election requirement can be triggered under certain circumstances. And so this is talking about those two topics um related to when the city wants to issue debt. You want anything? >> Any questions? All right. So, the first one, the PRI, um permanent permanent improvement revolving fund. Again, this particular bond is um a type um generally it's a general obligation. um we call it a PR um F bond and it is for the road construction and it is paid for by tax levy and special assessments. So again, it's not part of that 1% um um umbrella that we have there or ceiling of that. And right now, what's in there is the council authorizes it by the five votes um and established by the ordinance and um the purpose of that. And you know, then we go through the calendar of events that we have. And what we're um on the next slide um the last line is we were we're adding council can by a vote of four of its members adopt the resolution to award the sale >> fail though. >> Yeah. And that's the only change that we would make on 7.14. >> It's really to just add more clarity. So it's very specific. Um, you know, as we're coming up for council items, um, Melissa and I go through the items that need five votes, four votes. Um, so that as councils um, and the mayor are are working through each of the agenda and they know exactly what is required of them. So that this one was a four votes. Um, >> this is a this doesn't change. See if folks have comments to change. Anybody have an objection to this particular change? >> Makes sense. >> Go ahead. Go ahead. >> 7:15. >> 7:15 is those tax anticipation certificates that um we haven't used. Um and you know, so anytime after January 1. Um and you know, again, we only receive taxes twice a year. So it would have to be anticipation of that. Um and then there's very specific times of um when they can be issued a very specific on interest rates um in timing and again it's putting the full faith in credit which is our um tax levy abilities um to repay this debt. And on the next slide, um what we found on this particular one, um it did not have that authorized these type of bonds, the fi the five votes. And so we wanted to make sure that was added um and that it was authorized um through ordinance um to issue those um general obligation tax anticipation certificates and then that council can by a vote for adopted resolution to award. That's consistent. >> This is one of those items that we never use. >> Correct. >> The verb should be may again. And it should be on 7.16. Oh, wait. 7 7.14, wasn't that? Yeah. >> Council's may by >> May. Yeah. Yeah. Again, it's a discretionary authority. And also yeah on 7.14 it's also may I voted for adopt a resolution >> and both Yeah. And that's in Yeah. Tuesday. >> It's a it's a repeater. >> Yeah. On this one it's both at the five and the four that we'll have the May. >> Yeah. >> Would that change any discussion on this? Very similar last one. Okay. Going ahead with this one. See an objection. Okay. >> Go ahead. >> Yep. Good. >> And again, here's a emergency debt certificate. So, if there is um some sort of calamity or unforeseen cause that we would need to issue an emergency debt certificate. Um it does go very specific into that. It needs to be an ordinance to issue and sell. Um and then it talks about it cannot exceed two years and it has to bear um a normal legal interest rate. We can't have um someone just we can't you know legal interest but we don't want to use a interest rate so that someone's charging us a heck of an interest rate on there that they're profiting off of us on there. So um we would have to be very concerned about interest rates. Um and then city council must levy a tax sufficient to pay that principle and interest. So, um it depends on how it is structured over that period of time and it does very specifically say that five members of council are needed to authorize that >> and so um the recommended changes on that one. Um and you know I think we added in brackets the five is new and then um the council can and that we should change it the council may by a vote of four of its members adopt a resolution >> then that would be consistent then with looked at changes on the other ones. I think that's on this one. >> Okay. And on 7.17 um subdivision one see by the the very first line of there it already has that five members on there um and it goes through all the different pieces of timelines of charter bonds. So, for example, the council can authorize with the five votes and then we have to um put a public announcement in the newspaper and then um that lasts for 30 days. And during that 30 days, if um 2,000 um voters or thereabouts um sign a petition, um we would take it off and we would not sell that debt until we had a referendum vote on that. or the council can decide at that point if we got someone to and we call that a reverse referendum. Um because we're authorizing we're waiting 30 days seeing if we get um any petition of any sort and on the ones we've issued so far no one's petitioned that or questioned those pieces. So uh they're wanting the park improvements and those type of things. >> Um and then again the 5% of registered voters, the 2,000 voters. So, our adding on this one um again would be the same. >> Yeah. >> Could I pause for one who are here? Would we also like to change the council can change that to May? >> That would be consistent with what? >> So, okay. >> There's if we're going to do that, there's a bunch of canned >> okay to 717. We might have to revise that >> since we're amending it anyway. >> Just go and search for can >> um the subdivision two that's the next one um is what we established in 2015 when we um created um charter bonds so that we stay under that 1% debt limit category here and that's where section subdivision two um really pertains to. And so then on the blue slide, >> um that's what we would add. Um the city council may by vote of four um members adopt a resolution toward the sale of this type of bond. >> Yeah. >> The first instance where we talk about debt. What is a death? I assume it's positive >> um in >> still >> in in the in the title of the limitation on the net debt obligations that is um subdivision two where we cannot exceed the 1%. >> Yeah. So what is a debt bond? >> All all of these are debt bonds. >> There's there's a there's a >> Okay. You mean right here? A net bond. >> A net title. The title says >> net death bond. >> Well, we would have to look at that. But um >> in the title of the >> Yes, in the title. Um but there's no charter. >> This is there's not a a type of debt that's called net debt bond. >> So we'd have to look at the wording on that one. General general idea is that the net debt bond is fully covered. That's a positive. If it's a negative, it's there's a deficit in >> we can look on. We can look on that and if it's if it can be improved, we'll fix it. >> Yeah. I know a lot of the sorting came directly from our bond attorney. So, um I would bring it back to our bond attorney to to look at the wording here if we were gonna make any edits to this type of because >> um debt um >> avoid the 1% measurement >> because they were and further >> that they were approved by the >> well >> I mean it's it's not just the voters for the sales tax bonds it would also be um the permanent improvement revolving fund bonds because it's anything that is not um I would say this particular 1% is pertains to any instrument that we issued that is 100% tax paid for >> anything that's a combination where it's a fee or a special assessment is not part of the 1%. >> Right? So the net debt in um limit type of things really pertains to how state statute um defines how local governments can um the maximum net debt we can have outstanding. So, >> well, but your premise is that these might whole paragraph that says that it does unless >> we we would need to bring that one back >> about the 1%. So, my understanding is that you're talking about positive net debt bonds and that means they're fully paid. they're fully covered in some way otherwise there's no reason for statute. >> Um I mean there we might need to define what that means but there is not an obligation or called a net debt bond. Um it it really falls under how state statute describes how much debt we can have outstanding under that 3% debt limit. Um and so >> maybe maybe >> because of just like the totality of your debt, right? Like the net of your like >> Yeah. I mean I mean you know when we look at in our financial statements um we also get information about overlapping debt. So Hibin County might um issue debt there and it pertains to a portion of Bloomington gets has to pay for that. So that's an overlapping or a school district that's overlapping, >> right? Um, all of that has to take it to parts of the calculation. >> I think since since this language came from the bond attorney attorney, um, I think what we should do is and we've got a meeting in a week. I think we should just take that particular thing and say, "Hey, if we could come back in a week, we could do that." >> I'll I'll see if um, our bond attorney can look at that particular wording. >> They don't have to come, but just I think to try to answer question. I I'll see if there's any more definition or clarity that we could add to that that makes it cleaner to read. >> That's one of the things that we're trying to do in general is and some of this is is really hard to do, but try to have it be so that ordinary people can read it. Some of it's so technical it's impossible to do. >> Okay. >> Yeah. >> Okay. >> Check her out. >> That's a good point, Ronald. >> All right. Next. Sorry. Thanks for your hat. >> All right. So, that's the end of chapter seven. Chair, um, >> let me ask you this. Do you do you think there's 10 minutes worth of content here? I >> think that there's five minutes of content here. >> What I'd like to do is like like a little little tiny thing that you have after dessert with some coffee. This is the eight here. Five minutes of this. >> Okay. >> All right. So, chapter eight, improvements for special assessments. Next slide. >> So when we um want to make a public improvement um we um we can use the p our our power of special assessment um which means that we are essentially levying an levying an assessment on the benefited properties. We have um process and law, state law that we use um for example for chapter 429 to make um public improvements. Um we have on our books we have um special assessment policy that guides how we make decisions about what the assessments would be, how we would levy them. Um there's a test a special benefit test so that you cannot be levied more than the benefit that your property is receiving. And as a part of our internal process we appraise we we we um retain an appraiser to um make sure that we are meeting that test. Um and essentially what is happening that's sort of the overarching environment in which this is happening. And section 8.01 1 here says the city can can um make any type of improvement that's allowed um by law and has the power to levy an assessment on um on the on the people that are benefiting from it um to pay for it uh pursuant to the laws on in the books. Um, so that's essentially what's happening and that is what happens um on a fairly regular basis to to pay the public improvements that are occurring throughout the city. What would an improvement be that is not of a local character? That's such strange wording that it says improvements of a local character. Like what does that mean? it just for the neighborhood. I think they mean local being like the locality. Um so you couldn't you couldn't assess your um your residence for something happening in in that extended beyond the boundaries of your city. So for example when like a street um when you have a street it's just the people who are benefiting from that street. um when you have a um sidewalk, when you have a new hydrant, when you have a street light, certain things that come in, those public improvements, the benefiting properties um in that local area are the ones who are paying for it. So if um so like there's cost sharing, I'll stop because I'm interested. That make sense? >> Okay. So the next ch next slide 8.02 um assessment for services. So um these are the types of services that your um that property owners also benefit from. And this is saying that the council can adopt an ordinance um to charge the benefiting properties for those services. Um this is coming out of chapter 429.101. 101 of state law um that says a city has to act by ordinance to do this and it's very specific um services that benefit property. Uh so it has there has to be a tie to the property because the levy that the charge for those services is going back on the property. >> Yeah. >> Can I just ask a question just practical question? So now that the city does the snow removal on sidewalks, are those specific houses assessed for just those that have the sidewalk in front of them? Are they paying for the removal of the snow from sidewalk? So, um, chair members, I think sidewalk snow removal is a very very complicated and, um, not great example, >> um, to use, um, >> uh, in this for a whole bunch of reasons that are well beyond 10 time. >> Okay. >> Um, be happy to talk about it another time. Um, but, uh, it this is just giving us the authority. >> Okay. But I'm just wondering like yeah that's >> I think an example would be um sod replacement >> um or um uh like trees come down uh um uh what's the word for them? Diseased trees. Okay, there's a diseased tree and the and the benefiting properties of the removal of the that those are more concrete examples. Um, so we could also do like a uh on the rubbish um those hazardous homes that we >> hazardous homes >> where someone's um >> yeah really packed you know >> stuff in there have too many animals whatever and we have to come in and clean and do stuff for them. Um >> yeah, we assess them >> that cost >> to the property. >> Yeah. So this is essentially saying that we can do this. Um and I wanted to reassure you that we have all kinds of process in the background that was adopted by ordinance and all kinds of policies that the council has approved that and you'll hear them if you ever tune in to a a discussion about sidewalk repair or replacement um driveway aprons, that sort of thing. they'll hear about these policies and these mechanisms. Um, and there's a whole due process procedural process that grows out of state law in our and our city code for how people are made aware, have the ability to challenge, are notified, um, have the opportunity to have it explained, testified, city council, etc. The percentage that they're assessed, when they're assessed, if they have a corner lot, all those types of things. So probably at least in my experience the most ones that got people most riled up were the street reconstruction >> because it's the biggest for most people it's the biggest dollar amount for them they >> for most people's ownership of the house they they maybe it happens once maybe so it's a kind of surprising thing for people >> and you know so that the city was very careful about making sure that those those costs and what the part of it that was assessed to people kind of and the benefit that kind of matched up. It didn't make it feel any better when you wrote the check, but and then there's a whole, you know, just to the that question, there's a whole question of what's the equitable way to allocate that cost to to property because if you live on a corner, you've got a lot of >> Yeah. >> Yeah. You're screwed, >> you know, or if you you know, some lots of the city, for example, that are flag lots where the there's a little tiny section of the driveway that goes up to the street that's 15 feet wide, you know, is there should they pay a minimum? So there's a whole bunch of >> policy that's been nobody >> nobody's happy with it but there's no better set of choices. It just be different people unhappy if you >> Yeah. I mean what some if some cities that don't do specialments um they they just pay for it out of the general fund. >> So um there are choices but there are there are consequences for those choices. Some cities assess 100%. Some cities make a decision, they're only assessing 50% of their costs and the rest of it's coming out of the general fund. So that these kinds of policy documents um are the the council's expression of where of where they want to how they want to assign those financial responsibilities >> on the road construction. Those cities that were at 100% have all now been challenged because um that that benefit is not 100% because other people drive on that road. >> Exactly. Yeah. >> So, we're at 50%, right? Still >> uh 25%. >> Okay. >> And nobody challenges it basically, right? >> No. >> All right. >> Questions on these two sections? >> That's like a little bonus section. >> I figured that that two hours would be a good >> Yeah, that's what I think. >> Anybody have anything else they want to bring up for the meeting? notation to roll. >> We need to roll call the motion. >> We have somebody. >> Oh, it's been moved by Ramirez. Was there a second? >> Second. Seconded by uh J. >> Uh it's not discussable. So all those will please call the role. And Adrian, >> uh Rod Axel. >> Hi. >> Hi. >> Arnold Barnes. I >> I >> I >> I >> Iron Lquist. >> Hi. >> I Masuche. >> Hi. >> I >> I Peterson. Hi. Hi. passes. >> Thank you. Um and then the next >> um next is the next >> when is it even necessary >> for you first though meeting next and in her.