City Council
City Council
mar, 21 de abril de 2026
Puntos de agenda
Registros de votación
Resumen del debate
Transcripción
RESUMEN DE REUNIÓNGenerado por IA
Santa Rosa City Council — 21 de abril de 2026
Esta fue una reunión ordinaria del Concejo Municipal que se prolongó más de lo habitual e incluyó dos sesiones de estudio vespertinas sobre el presupuesto y la situación pensional de la ciudad. Tres concejales — MacDonald, Fleming y Ben-Wilos — estuvieron ausentes durante toda la sesión. La reunión comenzó con dificultades técnicas en los canales de Zoom e interpretación al español, lo que llevó al Alcalde Stapp a bromear diciendo que la reunión "iba tomando forma de episodio de Twilight Zone."
Sesión Cerrada
El Concejo se reunió en sesión cerrada para tratar dos puntos: una conferencia con negociadores laborales y una conferencia con el asesor legal respecto a una exposición significativa a litigación. El Procurador Municipal informó que no se tomó ninguna acción.
Sesión de Estudio 4.1: Actualización del Presupuesto del Fondo General para el año fiscal 2026–27
El Director Financiero Scott Wagner y la Gerente de Presupuesto Veronica (Frank) presentaron el panorama financiero de la ciudad antes de la adopción formal del presupuesto programada para el 16 de junio.
El número principal: El presupuesto base de la ciudad para el año fiscal 2026–27 proyecta un déficit de $17.5 millones en el Fondo General — exactamente donde el personal esperaba que se situara con base en proyecciones anteriores. El déficit es estructural: los gastos han crecido más rápido que los ingresos durante varios años.
Factores clave del déficit:
Dos programas financiados con subvenciones están perdiendo su financiamiento externo: la subvención SAFER (federal, en vencimiento), que financiaba puestos de bomberos, e In Response (un programa comunitario de salud mental lanzado con fondos ARPA y sostenido parcialmente con fondos del condado), el cual no recibirá el apoyo total del condado el próximo año. En conjunto, estos representan aproximadamente $13.9 millones del déficit.
Las horas extra de seguridad pública han excedido consistentemente el presupuesto. El presupuesto para horas extra del departamento de bomberos se ha mantenido artificialmente plano durante cuatro años mientras los costos reales han aumentado considerablemente. El personal propone una corrección de $3.1 millones para alinear el presupuesto con los costos reales combinados de horas extra de policía y bomberos.
Los salarios y beneficios representan el 77% de todos los gastos del Fondo General. La mayoría de las unidades de negociación colectiva tienen programado un aumento por costo de vida del 4% en 2026.
Panorama de ingresos: La ciudad proyecta aproximadamente $223 millones en ingresos del Fondo General — un incremento interanual del 3.6%. El impuesto a la propiedad sigue siendo sólido (crecimiento proyectado del 5.1%). El impuesto sobre las ventas, la fuente individual más grande de la ciudad, se está estabilizando tras los volátiles años posteriores al COVID, aunque crece apenas alrededor de un 1.4%. El personal señaló que las tendencias de compras en línea y la presión sobre los consumidores significan que el impuesto sobre las ventas probablemente crecerá solo entre un 2% y un 2.5% anual en el futuro — muy por debajo de la línea base previa al COVID. Los ingresos por permisos también están disminuyendo debido a la menor cantidad de proyectos de desarrollo grandes y de alto valor que están en trámite.
La estrategia a dos años: En lugar de recortar $17.5 millones de inmediato, el personal propuso un enfoque multidimensional a dos años:
Usar $8.4 millones de las reservas (la misma cantidad que el déficit adoptado del año en curso — de modo que la ciudad "no está quedando más atrás")
Ahorrar aproximadamente $1 millón al cambiar al financiamiento por arrendamiento para equipos mayores (camiones de bomberos, etc.) por encima de $250,000, ajustando mejor los pagos a la vida útil del equipo — *sin impacto en las entregas ni en la calidad de la flota*
Ahorrar $3.8 millones en el próximo año mediante una estrategia de reestructuración de la pensión CalPERS (tratada en el siguiente punto)
Lograr $4.3 millones en reducciones a nivel departamental — se pidió a los departamentos que identificaran escenarios de recorte del 1% y del 3% para dar flexibilidad al Gerente Municipal
El personal mostró diapositivas ilustrativas de lo que requeriría un recorte total de $17.5 millones: aproximadamente 89 puestos de tiempo completo (FTE) en toda la ciudad si se distribuyeran de manera uniforme, o más de 100 si se excluye a la policía y los bomberos — cifras que Wagner calificó de "reveladoras." El número de FTE del Fondo General está ahora cerca del mínimo histórico de la Gran Recesión, de aproximadamente 705, a pesar de que la población de la ciudad es aproximadamente un 50% mayor que en 2007–08.
Los concejales expresaron en términos generales su apoyo al enfoque. La Concejal Rogers manifestó su preocupación por el uso continuo de las reservas y si un año más de demora sería suficiente para romper el ciclo. También llamó al Concejo a sostener una conversación franca sobre cuáles son realmente los *servicios esenciales* de la ciudad — una pregunta que, según señaló, sigue surgiendo sin resolverse. El Concejal Okrepkie elogió las mejoras en transparencia del último año, incluidas las revisiones línea por línea de los departamentos realizadas por el subcomité de finanzas. El Concejo agradeció a la Gerente Municipal Interina Farrell su liderazgo en el presupuesto.
Las presentaciones detalladas por departamento se realizarán en sesiones de estudio los 5 y 6 de mayo, con publicación completa del presupuesto el 2 de junio y la audiencia de adopción el 16 de junio.
*No se tomó ningún voto; esta fue una sesión de estudio.*
Sesión de Estudio 4.2: Pasivo Pensional No Financiado de CalPERS y Estrategias para Evitar Costos
El Director Financiero Wagner presentó a Mike Myers de NH Advisors, una firma de asesoría municipal del North Bay especializada en estrategia pensional, quien expuso tres opciones para reestructurar las obligaciones de la ciudad con CalPERS.
La magnitud del problema: El pasivo acumulado no financiado (UAL) total de la ciudad con CalPERS es de $482 millones, dividido de manera aproximadamente equitativa entre los planes misceláneos y de seguridad. De ese total, aproximadamente $331 millones corresponden al Fondo General. Los pagos anuales totales de pensión de la ciudad se han más que duplicado desde 2018 — de aproximadamente $20 millones a más de $40 millones — y se proyecta que seguirán subiendo hacia los $50 millones antes de estabilizarse. Casi la totalidad del UAL proviene de empleados del plan "clásico" (aquellos contratados antes de 2013); los empleados de la era PEPRA contratados después de 2013 tienen niveles de beneficios más bajos y están esencialmente totalmente financiados.
CalPERS ha tenido dos buenos años de inversión (9.5% en el año fiscal 24, 12.1% en el año fiscal 25), por lo que los informes actuariales de otoño podrían mostrar una disminución del UAL — pero el personal utilizó los números conservadores del año anterior para todo el análisis.
La ciudad actualmente posee aproximadamente $26 millones en activos pensionales dedicados: aproximadamente $14.5 millones en un fideicomiso de la Sección 115 (constituido con fondos del acuerdo con PG&E derivados de los incendios forestales de 2017) y una reserva pensional administrada internamente. Myers señaló que el fideicomiso 115 ha crecido de $10 millones a $14.5 millones mediante inversiones.
Se analizaron tres opciones:
Opción 1 (Recomendada) — Fresh Start híbrido + retiro del fideicomiso 115: Solicitar a CalPERS un "fresh start" — básicamente refinanciar las aproximadamente 100 capas de amortización en un pago nivelado único de aproximadamente $32–33 millones al año durante aproximadamente 16 años. Luego, retirar metódicamente el fideicomiso 115 a lo largo de 9–10 años para que el Fondo General pague un monto menor de su propio bolsillo durante los años presupuestales más difíciles. Evitación de costos total: $36.6 millones a lo largo de la vida del programa; $3.8 millones en ahorros solo en el primer año. Liquida el UAL 6 años antes de lo programado actualmente. Mantiene el control local de los activos del fideicomiso.
Opción 2 — Retiro del fideicomiso 115 sin fresh start: Concepto similar, pero basado únicamente en retiros del fideicomiso sin reestructurar el calendario de pagos. Menos costosa de implementar, pero proporciona solo aproximadamente $30 millones en ahorros totales y agota el fideicomiso más rápidamente.
Opción 3 — Liquidar el fideicomiso y amortizar capas del UAL directamente: Enviar todos los fondos del fideicomiso a CalPERS de inmediato para eliminar capas de amortización específicas. Proporciona aproximadamente $32.5 millones en ahorros, pero elimina toda la liquidez y flexibilidad local.
El personal y la Gerente Municipal Interina Farrell recomendaron la Opción 1. Wagner señaló que es la única opción que cumple los cinco objetivos de política: presupuestación predecible, reducción del costo total, liquidación anticipada, mantenimiento del control local y alivio presupuestal a corto plazo. Reconoció que el fresh start fija la estructura de pago (como refinanciar una hipoteca), pero no impide que futuros consejos tomen medidas adicionales, como pagos discrecionales adicionales o, si las tasas de interés bajan, un bono de obligación pensional.
Los concejales mostraron un amplio apoyo. El Vicealcalde Okrepkie dijo que la Opción 1 "tiene mucho sentido." La Concejal Rogers preguntó sobre la contribución de los empleados al UAL (respuesta: la mayoría de las unidades de negociación colectiva aportan aproximadamente un 1.5% adicional por encima de la cuota requerida del empleado, sin fecha de vencimiento vigente). El Alcalde Stapp elogió el pensamiento creativo. La Concejal Alvarez expresó confianza en el análisis y citó: "Plantamos semillas de árboles cuya sombra nunca disfrutaremos."
El personal regresará con un contrato enmendado de CalPERS para que el concejo tome acción.
*No se tomó ningún voto; esta fue una sesión de estudio.*
Proclamación 7.1: Mes de Concientización sobre la Violencia Sexual
La Concejal Rogers leyó la proclamación que reconoce abril como el Mes de Concientización sobre la Violencia Sexual y honra a Verity, el centro local de prevención y sanación ante la violencia sexual. Rebecca Afine, Directora Ejecutiva de Verity, aceptó la proclamación. Señaló que Verity atiende a más de 1,200 sobrevivientes al año, opera una línea de crisis las 24 horas los 7 días de la semana, y lleva a cabo educación preventiva que alcanza a 14,000 miembros de la comunidad por año. Habló sobre la fragilidad del financiamiento, las recientes revelaciones en torno a César Chávez, y el desafío permanente de la credibilidad de los sobrevivientes en el discurso público, cerrando con un llamado a la acción: "Creemos a los sobrevivientes."
Informe del Procurador Municipal: Acuerdos
El Procurador Municipal informó sobre un acuerdo finalizado en marzo: una reclamación de Sami Good Arrow alegando entrada ilegal por parte del Departamento de Policía de Santa Rosa. La ciudad pagó $200,000 por una liberación total de todas las reclamaciones. La ciudad cuenta actualmente con 31 asuntos de litigación activos; 4 casos están en apelación tras resoluciones favorables a la ciudad a nivel de juicio.
Informes del Alcalde y del Concejo (Punto 11)
Las actualizaciones destacadas incluyeron:
El Vicealcalde Okrepkie informó que una votación para finalizar la reclamación de tránsito coordinado del programa MSCOTS de la SCTCA (diseñado para agilizar el tránsito en toda la región) no prosperó en la última reunión de la SCTCA debido a abstenciones y suplentes ausentes — retrasando el financiamiento y obligando a algunas agencias a cubrir costos temporalmente. Instó a sus colegas a garantizar que los suplentes asistan cuando los titulares no puedan hacerlo. También informó sobre la inauguración del proyecto Mendenhall (un importante proyecto de infraestructura de recuperación tras el Tubbs Fire), su participación como juez invitado en el concurso de barbacoa "Battle the Brews" (evento de 29 años que recaudó $60,000 para organizaciones juveniles benéficas), y una carrera de la Pat Tillman Foundation en la que su hijo quedó en segundo lugar.
El Alcalde Stapp informó sobre un recorrido por el campo geotérmico Geysers — señalando que Santa Rosa bombea 4 mil millones de galones al año para generar 700 megavatios de electricidad — y dijo que Sonoma Clean Power está explorando duplicar la capacidad de producción. También asistió a una reunión de la comisión de aviación sobre la reducción del ruido de las rutas de vuelo para los residentes del West County.
La Concejal Alvarez elogió al Jefe de Policía por llevar a oficiales de patrulla comunitaria a una reunión de seguridad pública en Roseland, poniendo "nombres a los rostros."
La Concejal Rogers reconoció el décimo aniversario de Orange Theory Fitness en Santa Rosa.
Punto 11.2.1: Comité de Selección Municipal — Comisión de Uso del Suelo del Aeropuerto
El Concejo instruyó al Alcalde para que apoye a Ariel Kelley de Healdsburg para su nombramiento en la Comisión de Uso del Suelo del Aeropuerto (llenando el puesto anteriormente ocupado por Todd Lands de Cloverdale). El Concejo también autorizó al Alcalde o a su designado para votar sobre cualquier nominación de último momento en la reunión del Comité de Selección Municipal del 14 de mayo.
Votación: Moción de Rogers, apoyada por Alvarez. Aprobada 4–0 (MacDonald, Fleming, Ben-Wilos ausentes).
Calendario de Consentimiento (Puntos 13.1–13.8)
Aprobado sin debate.
Votación: Moción de Okrepkie, apoyada por Rogers. Aprobada 4–0.
Punto de Informe 15.1: Presupuesto Preliminar del Sistema Regional de Reutilización del Agua para el año fiscal 2026–27
El Subdirector Nick Harvey presentó el presupuesto preliminar anual del Sistema Regional de Reutilización del Agua, que presta servicio a Santa Rosa, Rohnert Park, Sebastopol, Cotati y el Distrito de Saneamiento South Park del Condado de Sonoma.
Presupuesto de Operaciones y Mantenimiento: $54.6 millones (aumento del 3%, compensado en gran parte por la reducción de solicitudes de proyectos de operaciones/mantenimiento debido a arrastre de saldo)
Programa de Mejoras de Capital financiado en efectivo: $13 millones (aumenta $1 millón al año según el acuerdo entre socios)
Servicio de la deuda: $18.3 millones
Contribuciones netas de las agencias: $60.2 millones en total
Los principales factores de costo incluyen un aumento salarial del 4%, mayores costos de servicios públicos (la planta es el mayor consumidor de electricidad del Condado de Sonoma) y el aumento en los costos de eliminación de biosólidos. Los ingresos del programa de tarifas de descarga por camión crecieron significativamente (presupuestados en $4.7 millones, frente a $3.8 millones). Los aspectos destacados del CIP incluyen la rehabilitación de clarificadores secundarios, la largamente esperada protección contra inundaciones de la Laguna Treatment Plant (con asistencia de FEMA, $21.2 millones) y las actualizaciones eléctricas de la estación de bombeo Geysers.
El presupuesto debe enviarse a las agencias socias antes del 1 de mayo para que puedan planificar sus propios presupuestos.
Votación: Moción de Rogers, apoyada por Alvarez. Aprobada 4–0.
Audiencia Pública 16.2: Plan de Acción Anual de HUD para el año fiscal 2026–27
Kelly Kuykendall, Gerente de Vivienda y Servicios Comunitarios, presentó el plan de acción anual — la solicitud de subvención de la ciudad a HUD para fondos del Community Development Block Grant (CDBG) y HOME. Este es el Año 3 del Plan Consolidado trienal de la ciudad.
Asignación CDBG: Aproximadamente $1.3 millones (85% vivienda asequible, 15% servicios públicos)
Asignación HOME: Aproximadamente $680,000 (75% asistencia de alquiler basada en inquilinos, 15% CHDOs, 10% administración)
Total: Aproximadamente $2 millones
Se recibieron cuatro solicitudes para el financiamiento de servicios públicos (Catholic Charities, Fair Housing Advocates of Northern California y The Living Room); las recomendaciones finales de adjudicación regresarán al Concejo el 2 de junio. La Directora Megan Passenger señaló que la ciudad está viendo una modesta reducción del 2% en el financiamiento federal — consistente con los años recientes — pero que los presupuestos planos para programas como los vales de vivienda frente al aumento de costos representan un desafío acumulativo.
Una miembro del público, Victoria, preguntó si los residentes de ingresos muy bajos están cubiertos. El personal confirmó que los programas atienden a hogares con ingresos del 0% al 60% del ingreso medio del área.
Votación: Moción de Okrepkie, apoyada por Alvarez. Aprobada 4–0.
Comentarios Públicos sobre Puntos Fuera del Orden del Día
Fred (un comentarista habitual) planteó un punto técnico sobre cómo la ciudad define las "comunidades en desventaja" — argumentando que el ingreso medio por hogar de Santa Rosa está ligeramente por encima de la mediana estatal, lo que, según dijo, resulta en que algunos vecindarios de la ciudad pierdan la elegibilidad para ciertos programas a pesar de enfrentar cargas reales por el costo de vida.
Victoria, residente de Bethlehem Towers, regresó posteriormente para informar que un mercado cercano (Sam's Market en Tupper Street) había retirado su contenedor de basura exterior, generando basura en su vecindario, y preguntó si la ciudad podría exigir a los establecimientos comerciales mantener recipientes públicos de basura como condición de su permiso.
Puntos clave
La ciudad enfrenta un déficit de $17.5 millones en el Fondo General para el año fiscal 2026–27, impulsado principalmente por el vencimiento de subvenciones (SAFER e In Response), el desajuste en las horas extra de seguridad pública y el crecimiento estructural de los gastos que supera al de los ingresos. El personal propone una estrategia a dos años que combina el uso de reservas, financiamiento por arrendamiento de equipos, ahorros pensionales y $4.3 millones en recortes departamentales — con propuestas formales de recorte que llegarán el 5 y 6 de mayo.
El Concejo instruyó al personal a proceder con la Opción 1 del "fresh start" de CalPERS, una estrategia de reestructuración pensional que ahorraría a la ciudad un estimado de $36.6 millones a lo largo de la vida del programa y $3.8 millones solo en el primer año, mientras liquida el UAL de $331 millones del Fondo General seis años antes de lo programado actualmente.
El presupuesto preliminar del Sistema Regional de Reutilización del Agua para el año fiscal 2026–27 de $85.9 millones (operaciones, CIP y servicio de deuda combinados) fue aprobado para su distribución a las cinco agencias socias, con contribuciones netas de las agencias que aumentan menos del 1%.
El plan de acción anual de HUD de la ciudad (aproximadamente $2 millones en fondos CDBG y HOME) fue aprobado para su presentación, apoyando la vivienda asequible y los servicios para hogares que ganan hasta el 60% del ingreso medio del área.
La ausencia de tres concejales (MacDonald, Fleming, Ben-Wilos) significó que todas las votaciones fueron 4–0; el quórum reducido limitó la amplitud de la deliberación sobre las trascendentes decisiones financieras adoptadas en esta reunión.
Resumen generado por IA a partir de una transcripción de voz a texto. No es el registro oficial. Verifique los detalles importantes con los documentos fuente vinculados arriba.
Qué ocurrió en esta reunión
Ariel Kelley, Healdsburg
During public comment on non-agenda matters, a member of the public raised concerns about cost of living adjustments (COLA). The speaker noted that the water department presentation mentioned a 4% COLA for salaries and questioned why this adjustment wasn't applied to the definition of disadvantaged communities in Santa Rosa. The commenter pointed out that Santa Rosa's median household income is $1,000 higher than the state median, meaning residents don't receive COLA consideration despite higher local living costs. The speaker argued that if city staff receive a COLA, the public bearing higher cost burdens should also have the city's definition of disadvantaged communities adjusted using Santa Rosa's median household income rather than the state median.
CONFERENCE WITH LABOR NEGOTIATOR (Government Code Section 54957.6) Agency Designated Representative: Mayor Mark Stapp
The Council moved to closed session for Item 3.1, a conference with labor negotiator as permitted under Government Code Section 54957.6. The Mayor asked if any members of the public wished to comment on this item; seeing none, public comment was closed and the Council recessed into closed session.
CONFERENCE WITH LEGAL COUNSEL - SIGNIFICANT EXPOSURE
The Council moved to closed session for Item 3.2, a conference with legal counsel regarding significant exposure to litigation. The Mayor asked if any members of the public wished to comment on this item; seeing none, public comment was closed and the Council proceeded into closed session along with Item 3.1.
GENERAL FUND BUDGET UPDATE
# GENERAL FUND BUDGET UPDATE — COMBINED SUMMARY
CFO Scott Wagner and Budget Manager Connor presented the General Fund Budget Update for fiscal year 2026-27, detailing a projected $17.5 million structural deficit driven by expenditure growth (7.7%) significantly outpacing revenue growth (3.6%), with revenues totaling approximately $223 million and expenditures at $233.5 million. Key funding gaps include expiring federal grants (SAFER program), reduced county funding for IN-RESPONSE, and pre-existing overtime funding gaps in public safety departments—particularly a proposed $2.5 million addition to the fire department budget to align actual overtime costs with budgeted amounts. Staff outlined a two-year multi-pronged deficit strategy incorporating Phase 1 actions (15.2 million in prior reductions, 54 eliminated positions), strategic reserve usage ($0.4 million), apparatus leasing savings ($1 million), and CalPERS pension reductions ($3.8 million), with a $4.3 million departmental reduction target representing 25% of the deficit solution. Wagner emphasized that no proposed reductions would be discussed at this meeting, as the City Manager is still reviewing options to be presented to Council on May 5-6 for detailed departmental discussions, with final budget adoption scheduled for June 16, and a pension reduction strategy study session planned for April 21st. Council members praised staff for developing creative cost-management solutions while raising concerns about service delivery impacts, sales tax underperformance relative to historical trends, budget sustainability, and the need to formally define core city services before making additional cuts.
CFO Scott Wagner and Budget Manager Connor presented the General Fund Budget Update for fiscal year 2026-27, detailing a projected $17.5 million structural deficit driven by expenditure growth (7.7%) significantly outpacing revenue growth (3.6%), with revenues totaling approximately $223 million and expenditures at $233.5 million. Key funding gaps include expiring federal grants (SAFER program), reduced county funding for IN-RESPONSE, and pre-existing overtime funding gaps in public safety departments—particularly a proposed $2.5 million addition to the fire department budget to align actual overtime costs with budgeted amounts. Staff outlined a two-year multi-pronged deficit strategy incorporating Phase 1 actions (15.2 million in prior reductions, 54 eliminated positions), strategic reserve usage ($0.4 million), apparatus leasing savings ($1 million), and CalPERS pension reductions ($3.8 million), with a $4.3 million departmental reduction target representing 25% of the deficit solution. Wagner emphasized that no proposed reductions would be discussed at this meeting, as the City Manager is still reviewing options to be presented to Council on May 5-6 for detailed departmental discussions, with final budget adoption scheduled for June 16, and a pension reduction strategy study session planned for April 21st. Council members praised staff for developing creative cost-management solutions while raising concerns about service delivery impacts, sales tax underperformance relative to historical trends, budget sustainability, and the need to formally define core city services before making additional cuts.
CALPERS PENSION UNFUNDED LIABILITY EXPENSES OVERVIEW
# CalPERS Pension Unfunded Liability Expenses Overview – Combined Summary
Staff presented a comprehensive overview of Santa Rosa's $482 million CalPERS pension unfunded liability ($331 million attributable to the general fund), explaining that the city's combined pension payments have more than doubled from approximately $20 million in 2018 to over $40 million in fiscal year 2026, projected to reach close to $50 million by decade's end. The unfunded liability emerged primarily due to CalPERS missing investment targets and changing actuarial assumptions, with nearly 100% originating from classic plan members hired before 2013, while recent positive investment performance (9.5% in 2024 and 12.1% in 2025) is expected to decrease the liability when new reports are released in fall 2026. Staff, with pension expert Mike Myers from NH Advisors, outlined three strategic options to address the liability, with Option 1 (a hybrid model utilizing a fresh start consolidation and the city's $14.5 million 115 trust) recommended by the City Manager and Finance Department as it would save the city $36.6 million over the program's life while providing $3.8 million in immediate budgetary relief and achieving all five policy objectives, including predictable budgeting, flatter payment schedules, and early debt retirement. Most council members, including Vice Mayor and Councilmembers, expressed support for Option 1, with one Councilmember Rogers preferring Option 3, while staff emphasized that regardless of the selected option, continued funding is necessary and future workshops should address risks and mitigation strategies.
Staff presented a comprehensive overview of Santa Rosa's $482 million CalPERS pension unfunded liability ($331 million attributable to the general fund), explaining that the city's combined pension payments have more than doubled from approximately $20 million in 2018 to over $40 million in fiscal year 2026, projected to reach close to $50 million by decade's end. The unfunded liability emerged primarily due to CalPERS missing investment targets and changing actuarial assumptions, with nearly 100% originating from classic plan members hired before 2013, while recent positive investment performance (9.5% in 2024 and 12.1% in 2025) is expected to decrease the liability when new reports are released in fall 2026. Staff, with pension expert Mike Myers from NH Advisors, outlined three strategic options to address the liability, with Option 1 (a hybrid model utilizing a fresh start consolidation and the city's $14.5 million 115 trust) recommended by the City Manager and Finance Department as it would save the city $36.6 million over the program's life while providing $3.8 million in immediate budgetary relief and achieving all five policy objectives, including predictable budgeting, flatter payment schedules, and early debt retirement. Most council members, including Vice Mayor and Councilmembers, expressed support for Option 1, with one Councilmember Rogers preferring Option 3, while staff emphasized that regardless of the selected option, continued funding is necessary and future workshops should address risks and mitigation strategies.
Puntos de agenda (28)
Procedural (8)
1ProceduralHTTPS://SANTA-ROSA.LEGISTAR.COM/CALENDAR. CLICK ON THE "IN PROGRESS" LINK TO VIEW;
Instructions for viewing the meeting agenda online through the city's Legistar calendar system.
2ProceduralVIA ZOOM WEBINAR BY VISITING
Instructions for joining the meeting remotely via Zoom webinar.
3ProceduralCOMCAST CHANNEL 28 OR 26 (ESPAÑOL), AT&T U-VERSE CHANNEL 99; AND
Instructions for watching the meeting on local cable television (Comcast or AT&T U-Verse).
4ProceduralVIA YOUTUBE AT HTTPS://WWW.YOUTUBE.COM/CITYOFSANTAROSA Public Comment may be made live during the meeting In-Person from Council Chamber or submitted in advance via email at cc-comment@srcity.org by 5:00 p.m. the Monday before the City Council Meeting. IN THE EVENT A COUNCIL MEMBER PARTICIPATES REMOTELY BASED ON JUST CAUSE UNDER THE BROWN ACT, THE CITY WILL ALLOW FOR PUBLIC COMMENT THROUGH THE ZOOM LINK OR DIAL-IN
Information on how residents can submit public comments during the meeting in person, via Zoom, or by email before 5 p.m. on the Monday before the meeting.
12.1ProceduralMarch 24, 2026, Regular Meeting Minutes (THIS ITEM IS BEING
The council will approve the official minutes from the March 24, 2026 regular meeting.
12.2ProceduralApril 7, 2026, Regular Meeting Minutes.
The council will approve the official minutes from the April 7, 2026 regular meeting.
Qué ocurrió
The Council reviewed and adopted the April 7, 2026 meeting minutes. No edits or public comments were raised regarding the minutes. The minutes were approved and adopted without discussion.12.3ProceduralApril 10, 2026, Special Meeting Minutes.
The council will approve the official minutes from the April 10, 2026 special meeting.
Qué ocurrió
The Council reviewed and adopted the April 10, 2026 meeting minutes. No edits or public comments were raised regarding the minutes. The minutes were approved and adopted without discussion.21.1ProceduralUPCOMING MEETINGS LIST
The council will receive information about upcoming meetings scheduled for the coming months.
General Business
14General BusinessAriel Kelley, Healdsburg
Information about Ariel Kelley from Healdsburg as a candidate for a board position.
Qué ocurrió
During public comment on non-agenda matters, a member of the public raised concerns about cost of living adjustments (COLA). The speaker noted that the water department presentation mentioned a 4% COLA for salaries and questioned why this adjustment wasn't applied to the definition of disadvantaged communities in Santa Rosa. The commenter pointed out that Santa Rosa's median household income is $1,000 higher than the state median, meaning residents don't receive COLA consideration despite higher local living costs. The speaker argued that if city staff receive a COLA, the public bearing higher cost burdens should also have the city's definition of disadvantaged communities adjusted using Santa Rosa's median household income rather than the state median.4.1General BusinessGENERAL FUND BUDGET UPDATE
City staff will present an update on the General Fund budget and how spending compares to projections.
Qué ocurrió
# GENERAL FUND BUDGET UPDATE — COMBINED SUMMARYCFO Scott Wagner and Budget Manager Connor presented the General Fund Budget Update for fiscal year 2026-27, detailing a projected $17.5 million structural deficit driven by expenditure growth (7.7%) significantly outpacing revenue growth (3.6%), with revenues totaling approximately $223 million and expenditures at $233.5 million. Key funding gaps include expiring federal grants (SAFER program), reduced county funding for IN-RESPONSE, and pre-existing overtime funding gaps in public safety departments—particularly a proposed $2.5 million addition to the fire department budget to align actual overtime costs with budgeted amounts. Staff outlined a two-year multi-pronged deficit strategy incorporating Phase 1 actions (15.2 million in prior reductions, 54 eliminated positions), strategic reserve usage ($0.4 million), apparatus leasing savings ($1 million), and CalPERS pension reductions ($3.8 million), with a $4.3 million departmental reduction target representing 25% of the deficit solution. Wagner emphasized that no proposed reductions would be discussed at this meeting, as the City Manager is still reviewing options to be presented to Council on May 5-6 for detailed departmental discussions, with final budget adoption scheduled for June 16, and a pension reduction strategy study session planned for April 21st. Council members praised staff for developing creative cost-management solutions while raising concerns about service delivery impacts, sales tax underperformance relative to historical trends, budget sustainability, and the need to formally define core city services before making additional cuts.
4.2General BusinessCALPERS PENSION UNFUNDED LIABILITY EXPENSES OVERVIEW
Staff will explain the city's unfunded pension liabilities with CalPERS and related expenses.
Qué ocurrió
# CalPERS Pension Unfunded Liability Expenses Overview – Combined SummaryStaff presented a comprehensive overview of Santa Rosa's $482 million CalPERS pension unfunded liability ($331 million attributable to the general fund), explaining that the city's combined pension payments have more than doubled from approximately $20 million in 2018 to over $40 million in fiscal year 2026, projected to reach close to $50 million by decade's end. The unfunded liability emerged primarily due to CalPERS missing investment targets and changing actuarial assumptions, with nearly 100% originating from classic plan members hired before 2013, while recent positive investment performance (9.5% in 2024 and 12.1% in 2025) is expected to decrease the liability when new reports are released in fall 2026. Staff, with pension expert Mike Myers from NH Advisors, outlined three strategic options to address the liability, with Option 1 (a hybrid model utilizing a fresh start consolidation and the city's $14.5 million 115 trust) recommended by the City Manager and Finance Department as it would save the city $36.6 million over the program's life while providing $3.8 million in immediate budgetary relief and achieving all five policy objectives, including predictable budgeting, flatter payment schedules, and early debt retirement. Most council members, including Vice Mayor and Councilmembers, expressed support for Option 1, with one Councilmember Rogers preferring Option 3, while staff emphasized that regardless of the selected option, continued funding is necessary and future workshops should address risks and mitigation strategies.
7.1General BusinessPROCLAMATION - SEXUAL ASSAULT AWARENESS MONTH
The council will recognize Sexual Assault Awareness Month with a formal proclamation.
Qué ocurrió
# Sexual Assault Awareness Month Proclamation SummaryStaff presented a proclamation honoring Sexual Assault Awareness Month in April 2026, with Ms. Rogers providing statistics demonstrating that sexual violence is widespread—affecting nearly half of all women and at least one in six men, with marginalized communities at disproportionately higher risk. Rebecca Fine, Executive Director of Verity sexual assault prevention center, expressed gratitude for the city's recognition, emphasizing that such acknowledgment sends a powerful message to survivors that "we see you, you are not alone," and detailed Verity's comprehensive services supporting over 1,200 survivors annually through 24/7 crisis intervention, advocacy, and age-appropriate prevention education starting at age 5. Fine also highlighted Verity's partnerships with Santa Rosa Police Department and Code Enforcement to prevent sexual trafficking and support victims, while addressing the complex tension survivors face between speaking truth and protecting larger movements. The council unanimously accepted the proclamation, closed public comment without any public speakers, and concluded with a photo opportunity with Verity representatives.
9.1General BusinessREPORT OF SETTLEMENTS AND ACTIVE LITIGATION The City Attorney will report on all settlements authorized by Council in closed session that were finalized in March 2026, which includes but may not be limited to all settlements requiring the City to pay more than $50,000. The City Attorney will also provide a summary of pending litigation against the City.
The City Attorney will report on all legal settlements the city paid out in March 2026 (over $50,000) and summarize ongoing lawsuits against the city.
Qué ocurrió
The City Attorney provided a monthly report on settlements and active litigation. One settlement was finalized in March 2026 related to a claim by Sami Good Arrow alleging unlawful entry by Santa Rosa Police Department into a home; the city paid $200,000 for a full release of all potential claims. The caseload remains at 31 current litigation matters, with trial dates assigned to approximately a quarter of trial-level matters and 4 cases currently on appeal with favorable rulings for the city at the trial court level. No members of the public commented on the report.11.1General BusinessMAYOR'S/COUNCIL MEMBERS' SUBCOMMITTEE AND LIAISON REPORTS (AND POSSIBLE COUNCIL DIRECTION TO BOARD REPRESENTATIVE ON PENDING ISSUES, IF NEEDED) 11.1.1 Council Subcommittee Reports 11.1.2 Sonoma County Transportation and Climate Authorities (SCTCA) 11.1.3 Sonoma County Water Agency (SCWA) - Water Advisory Committee 11.1.4 Association of Bay Area Governments (ABAG) 11.1.5 Sonoma County Agricultural Preservation and Open Space District
Council members will report on their work with local and regional committees including transportation, water, and open space boards, with possible directions to city representatives on pending issues.
11.2General BusinessSONOMA COUNTY MAYORS' AND COUNCIL MEMBERS'
Council will receive information about the Sonoma County Mayors' and Council Members' organization or activities.
Qué ocurrió
The Council discussed the Sonoma County Mayors' and Council Members' Association city selection committee regarding the Airport Land Use Commission. Councilmember Rogers made a motion to authorize the mayor as designee with authority to vote on any late nominations or recommendations for the Airport Land Use Commission. The motion identified Ariel Kelley as the nominee for the Airport Land Use Commission seat. Councilmember Alvarez seconded the motion. No public comment was received on this item, and the motion was approved by the City Council.15.1General BusinessREPORT - APPROVAL OF THE PRELIMINARY FY 2026-27
Staff will present the proposed budget for the city's fiscal year 2026-27 for council approval.
Qué ocurrió
# FY 2026-27 Preliminary Budget SummaryDeputy Director of Administration Nick Harvey presented the preliminary budget for the Regional Water Reuse System for fiscal year 2026-27, highlighting a 3% operations budget increase driven by 4% salary increases and $700,000 in professional services for treatment component replacements, along with an $800,000 increase in electricity costs due to CHP engine maintenance and UV system testing. Major capital improvement projects include the Laguna treatment plant flood protection project ($21.2 million), secondary clarifier rehabilitation at Clara fires ($0.9 million), and Geysers pump station electrical upgrades, with total CIP investments of $10.5 million and agency contributions of $60.2 million. Revenue sources include expanded tipping fees from the truck waste program (increasing to $4.7 million from $3.8 million) and increased interest income on pooled investments, while the regional fund's refund reserve is expected to reach $16.2 million before decreasing by $6-7 million due to recent appropriations. Mayor Stapp commended staff for their work and emphasized the critical importance of disinfection systems at treatment plants and contingency protocols for the Geysers project.
16.2General BusinessPUBLIC HEARING - SUBMITTAL OF THE FISCAL YEAR 2026/2027 ACTION PLAN TO THE U.S. DEPARTMENT OF HOUSING AND
The council will hold a public hearing to submit the city's 2026-27 spending plan for federal housing funds to the U.S. Department of Housing and Urban Development.
Qué ocurrió
# SummaryKelly Kuykendall, Housing and Community Services Manager, presented the fiscal year 2026-27 action plan (year 3 of a 3-year Consolidated Plan) for HUD submission by the May 15th deadline, outlining approximately $2 million in funding allocations ($1.3 million in CDBG funds and $680,000 in HOME grants) for affordable rental housing, housing preservation, and services for special needs populations. The department conducted extensive outreach including a virtual public meeting on February 11th and a 30-day public comment period (March 20-April 20), receiving four applications for public services funding from organizations including Catholic Charities and Fair Housing Advocates of Northern California. Council members, including Vice Mayor Okrepkie, raised concerns about the impact of a 2% funding reduction combined with inflation on voucher programs, while staff clarified that funding covers individuals at 0-60% of area median income. Vice Mayor Okrepkie moved to adopt the resolution, which passed with 4 affirmative votes.
Closed Session
3.1Closed SessionCONFERENCE WITH LABOR NEGOTIATOR (Government Code Section 54957.6) Agency Designated Representative: Mayor Mark Stapp
A closed-session discussion between city leadership and labor negotiators regarding employee contract negotiations.
Qué ocurrió
The Council moved to closed session for Item 3.1, a conference with labor negotiator as permitted under Government Code Section 54957.6. The Mayor asked if any members of the public wished to comment on this item; seeing none, public comment was closed and the Council recessed into closed session.3.2Closed SessionCONFERENCE WITH LEGAL COUNSEL - SIGNIFICANT EXPOSURE
A closed-session meeting with the City Attorney to discuss potential legal claims or liability issues facing the city.
Qué ocurrió
The Council moved to closed session for Item 3.2, a conference with legal counsel regarding significant exposure to litigation. The Mayor asked if any members of the public wished to comment on this item; seeing none, public comment was closed and the Council proceeded into closed session along with Item 3.1.Consent Calendar
13.1Consent CalendarMOTION - AMENDMENT TO MEMORANDUM OF UNDERSTANDING NUMBER F003065 WITH COUNTY OF SONOMA PROBATION
The council will approve changes to an agreement with the County of Sonoma Probation Department.
13.2Consent CalendarMOTION - AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT - CALISTOGA ROAD PAVEMENT REHABILITATION AND UTILITY IMPROVEMENTS - MONTECITO BOULEVARD TO
The council will approve an amendment to a professional services contract for the Calistoga Road and Montecito Boulevard pavement and utility improvement project.
13.3Consent CalendarMOTION - CONSTRUCTION CONTRACT AWARD - C02540
The council will award a construction contract for a city project.
13.4Consent CalendarMOTION - CITY OF SANTA ROSA AND GMV SYNCROMATICS CORP. THIRD AMENDMENT FOR COMPUTER AIDED DISPATCH
The council will approve a contract extension with GMV Syncromatics Corp. for computer-aided dispatch software used by city emergency services.
13.5Consent CalendarRESOLUTION - AUTHORIZATION OF PAYMENT TO AT&T FOR UTILITY RELOCATION AT FIRE STATION 5 AND DELEGATION OF SIGNATURE AUTHORITY TO APPROVE AND EXECUTE STANDARD
The council will authorize payment to AT&T for moving utility lines at Fire Station 5.
13.6Consent CalendarRESOLUTION - SANTA ROSA CITYBUS PUBLIC TRANSIT AGENCY
The council will adopt a resolution regarding Santa Rosa CityBus public transit operations or policies.
13.7Consent CalendarRESOLUTION - ADOPTION OF COUNCIL POLICY ENTITLED
The council will adopt a new or updated city policy.
13.8Consent CalendarORDINANCE ADOPTION SECOND READING - ORDINANCE OF THE COUNCIL OF THE CITY OF SANTA ROSA AMENDING TITLE 20 OF THE MUNICIPAL CODE TO ADDRESS STREAMLINING AND PROCESS IMPROVEMENTS FOR THE CONDITIONAL USE PERMIT
The council will give final approval to changes to city zoning rules that streamline the conditional use permit process.
Public Hearing
16.1Public HearingPUBLIC HEARING - ORDINANCE INTRODUCTION - ORDINANCE ENTITLED: ORDINANCE OF THE COUNCIL OF THE CITY OF
The council will hold a public hearing and introduce a new ordinance for first reading.
Votos adicionales registrados en actas
Authorize mayor/designee to vote on airport land use commission nomination
aye 4 · absent 3
Alvarezaye
Ben Willowsabsent
Flemingabsent
MacDonaldabsent
Okrepkieaye
Rogersaye
Stappaye
Approve minutes of April 7, 2026 and April 10, 2026
aye 1
voice voteaye
Adopt consent calendar items 13.1 through 13.8
aye 4 · absent 3
Alvarezaye
Ben Willowsabsent
Flemingabsent
MacDonaldabsent
Okrepkieaye
Rogersaye
Stappaye
Adopt resolution approving preliminary FY 2026-27 regional water reuse system budget and allocation of costs
aye 4 · absent 3
Alvarezaye
Ben Willowsabsent
Flemingabsent
MacDonaldabsent
Okrepkieaye
Rogersaye
Stappaye
Adopt resolution authorizing submission of FY 2026-27 Action Plan to HUD
aye 4 · absent 3
Alvarezaye
Ben Willowsabsent
Flemingabsent
MacDonaldabsent
Okrepkieaye
Rogersaye
Stappaye
Transcripción literal disponible
95 segmentos de transcripción indexados
>> I'd like to ask interpreter currently on the Spanish Channel to commence interpretation of the meeting for those just joining the meeting, live interpretation in Spanish is available. And members of the public or staff wishing to listen in Spanish. Can join the Spanish channel by clicking on the interpretation icon and the Zoom Toolbar. It looks like a clue if you're on your cell phone or tablet locate the 3 dots, top them lightly and put a check mark on your preferred language. Click on to activate and begin the interpretation. Won't you join the Spanish Channel? We shut off the main audio. So you only hear the Spanish interpretation, Francisco, you please restate this in Spanish. >> She went to some of the circles, but put this to him and his play on as we cope with, though it I got a leak in a book on the global. The leak has been you'll humid casinos, of the old he not. It's a little public. Okay. U.S. Well more. We're going to put the Cilic soon Espanol. He was he didn't see all. Go to Keenan. He puts you in a few know the Souther. Ask Thank you. >> All right. Welcome everyone. The time is 12 16 will call this meeting to order city clerk. Would you please call the roll? >> Thank you, Mayor. Councilmember Rogers, PRESIDENT. Councilmember MacDonald is absent. Councilmember Fleming is absent. Councilmember Ben, we alos is absent councilmember Alvarez present. Vice Mayor Okrepkie here. Mayor, stop here. Let the record reflect all councilmembers are present with the exception of
councilmember has been Willis, Fleming and MacDonald. >> Thank you. All right. And we will move on to item. 3 are closed session items. Item conference with labor negotiator and then item 3.2 conference with legal counsel regarding significant exposure to litigation. Do we have any members of the public hearing was to make public comment either of these items, seeing none. We'll close public comment and we're recess in a closed session. >> Okay. We have some technical difficulties, Francisco. We're going to restate the announcement. So I've moved to pack into the English room. Okay. All right. So cloudy. I'd like you to like to ask you to commence interpretation of the meeting for those just joining the meeting. Live interpretation in Spanish is available and members of the public or staff wishing to listen in. Spanish can join the Spanish channel by clicking on the interpretation icon in this toolbar it looks like a globe. If you're on your cell phone or tablet locate the 3 dots, tap them lightly and put a check mark on your preferred language. Click done to activate and begin the interpretation. Once you join the Spanish Channel, we recommend you shut off the main audio. So you only hear the Spanish interpretation, Francisco, you please restate this in Spanish. Sure. Thank you. See, we want to start is to close. Into that the soonest been killed. >> And to come up what I got to be committed. On the global. The leak has been you'll mother Casey Lynn Scott, how he not. In sum that up, that lead to ok more us. We're going to put this film. This person looks to knit.
It's assailants got all to Keenan Peoples Unit finally settle. Think you. >> Welcome back, everyone to the Twilight Zone episode that this meeting is shaping up today. I'd like to confirm with our it team that we do have zoom coverage. We're good to go on that case. We're going officially kick this off again with the time of 12. MADAM City Clerk, please call the roll. Thank you, Mayor. >> Councilmember Rogers, PRESIDENT Councilmember MacDonald is absent. Councilmember Fleming is absent. Councilmember Ben Willows is absent councilmember Alvarez present COUNCILMAN Vice-mayor Okrepkie here. Mayor stopped here. Let the record councilmembers are present with the exception of councilmembers been. We alos climbing and MacDonald. >> Thank you very much. We will again move to item 3 are closed session items we have today item 3.1 conference with labor negotiator and item 3.2 conference will council regarding significant exposure to litigation. Are there any members public who wish to comment and of these items seeing none. We'll close public comment and we will recess in a closed session. All right. Thank you for your patience, everyone. The time is tickets to 1640 46 minutes late. But we will reconvene in open session. MADAM City clerk, would you please call the roll? >> Thank you, Mayor Councilmember Rogers, PRESIDENT Council members, MacDonald Fleming and been Willows are absent. Councilmember, however, as PRESIDENT Councilmember Okrepkie here, mayor stepped here. Let the record reflect all councilmembers are present. With the exception of Ben, we Alos Fleming and
MacDonald. >> Thank you very much. All right. We're gonna get started with our highlight for the afternoon. Our General Fund our item 4.1, our General Fund budget update. And of course, eventually item 4.2, which is our our Calpers discussion. Alright finance team. Welcome. Get us started. Thank you staff. Members of council Scott Wagner, chief financial officer with me here today is from Connor, the city's budget manager. We're very pleased present this item getting a budget development update for coming. >> Fiscal year, 26, 27. So just brief overview of where we are in the process. You know, it was like to say budget you process. It takes about 6 months of work where we are is right in that middle area right now coming back with this update. Pryor portions have included the department's developing their proposed base budgets for the fiscal year 26. 27 occurred in JANUARY. In MARCH, the city manager conducted thorough review of those beach base budgets developed by departments. Couple weeks ago we went to the lt fpa the city's finance subcommittee to discuss where we're at in the process going forward. A couple weeks from now on MAY, 5th in 6 will be returning to council with an additional budget study. Sessions with apartments and can really get into the greater much greater detail than we're going to hear today. And how are department's lead part of those discussions to talk about any proposed reductions that the city manager will be moving forward along with programs moving forward by the by the city. On JUNE. Second, we'll be publishing a draft of the city's full budget and then will be returning on JUNE 16th for a public hearing to
adopt the cities budget starting on JULY one of 2026. Next slide. Big picture as part of our base budget. We're seeing a 17 and a half million dollar general fund deficit. This is right about where we shot. We would be. And if you look presentations that we've given over the past year and a half, this is right about where we thought that deaths it would come in and it has as part of our base budget. The deficit fundamentally structural in its nature. It just means that our expenditures are still growing faster than our revenues here at the city. That's been the case now for a while. And that's ultimately the net. We're trying to crack with our fiscal fiscal sustainability. If we were to take no corrective actions and adopt a 17 and a half million dollar deficit, we would again expect the structural aspect of our deficit to cause growing deficits in the future years. Frank is going to go through our forecasts. But again, it's the same trend that we've been seeing. We've been making progress. The actions that have been getting taken that which I'll go through in detail have made a big difference. That is a fact. But the reality is we just still have not fully gotten over this snowball effect within our budget. Frank go through in a little bit more detail. Our revenues and expenditures. But key to today's discussion is that we will not be discussing any proposed reductions at this time. The facts are that our city manager still in the process of those of reviewing those reductions and those will move forward on the 5th in the 6 2, bring to council to have departments here to discuss it further detail. Next slide. I wanted to find the term base budget because
we haven't used it in the past. But it's a really great term for us to use. Is that the numbers we're talking about today really don't include any proposed reductions, but it does include include things that are already baked into our budget from prior years. What it does include is essentially are in response programs in are safer. Grant. Now we'll be talking about it more in a moment. But both of those programs have been funded by outside funding for the history of the city. What we're seeing now is that those outside funding sources are no longer with the case of safer. It's the federal grant expiring and with the case of in response is that was a program that was launched with federal arpa dollars, one-time dollars that was able to be maintained with county grant funds and we do not. We do not anticipate receiving the full amount from the county 2 for that program in the coming year. So those positions and those expenditures have not been removed from the budget at this time. Next slide. I'm sorry. Go back. One more. I told on a covid do this. One more thing that the base budget does address is that when we've analyzed our budget so far and we discussed this at the lt fda is that we're seeing are trend on actuals with in overtime far exceeding our budget. So we have a pre-existing funding gap in our over time for our public safety departments that this base budget does address this is frankly just good
budgeting. We're going to talk about that much more at length few evening or today, but going forward on the 5th in 6, both Chief Cregan in chief Westrope will be coming down the council to give the full analysis and talk about the trends that they're seeing within the overtime, their overtime budgets and actions that are getting taken, that to ensure that we're maintaining. Salt with pass it off to Veronica. Run us through our forecasts and revenues and expenditures. >> So our long-range forecast is something we show it just about every budget update that we have looking back at fiscal year. 25 26 our current fiscal year. We adopted a deficit of 8.4. And Scott mentioned, we are right at a 17 and a half million dollar project, a deficit for fiscal year. 26. 27. We see this continue to grow in the out years as our revenues are just not keeping pace with our expenditures. And are projected General Fund reserve slide. It does show that we are expected to be under our. Council mandated by fiscal year. 27. So that one right? >> Yeah. So this is the same trend that we've been seeing within. >> Our General Fund reserve spend down so again because we're still experiencing the structural deficit. We're we're showing here, as we've done in the past on how that sustained deficit would impact the city's reserves. The important takeaways really from this slide is that the box on the right hand side is our upcoming budget option that we're working on fiscal year, 27 and then the next year being fiscal year 2028, what we would anticipate with no budgetary reduction actions is that we would fall below are mandated reserve in the coming adopted year by the end
of the year. That's important because our mandated reserve is really what I consider our disaster or macroeconomic big impact while we can say sustainable and continue operations as a city. We anticipate that being around 45 million dollars in fiscal year. 2027. So you'd see without action. We would actually fall below to about 37 Million. I know every time I talk about this live at the site has put together with governmental accounting standards. Those are complete, very complex, more complex than they should be. But to decide what it means is that we live one year in advance government accounting standards. See when he passes a deficit. You to hold that against your reserve. So sometimes I get asked how come years don't exactly line up. They want up a year in advance. Next slide. So taking a look at our revenues projected for next year. >> And the general fund for the city road projecting about 223 million dollars worth of revenues to run our general fund property tax continues to be a very strong, very reliable source for the city's general fund. We do anticipate hitting our budget for 25. 26 of 41.4 million and we anticipate this will grow at 5.1% for next year. Sales tax has been more volatile over the last few years. However, this year, we think finally getting on track. We do expect to hit our 70 and a half million dollar budget for fiscal year. 25 26 or come in very, very close. And we're looking at a growth rate of about 1.4% for next year. It's not a large growth rate but its growth in the right direction. We are still seeing increases in places such as our fuel and service stations as well as our county pool, which is where we see our
online sales tax revenue comes through. Also worth mentioning our permits, fines and charges are seeing a decrease. This is our ped permit revenue. We're starting to see some changes in trends in our planning and economic development department where we're seeing maintaining high volume of permits, but they're lower in dollars. We don't have as high ticket permits coming through in large developments. So we're keeping a close eye on this. Had does have a rate structure in place that plans for adequate cost recovery. We are just seeing a difference in the types of permits that are walking through the door. Our recreation revenues, we're budgeting a 24% increase for next year, which is sizable. This is a reflection of high demand in our rec programs. They're popular. We have a lot of people that signed up for these and back in JANUARY, our recreation division to come back an increase some of their rates. They felt that the market can bear the burden of some higher costs. We're doing everything we can to the general fund to bring in what revenue we can to sustain our operations. >> Quick quick, no additional note on sales tax is we have been. >> Glad to see some stabilizing of that figure. But when we look at it on a 3 to 4 year basis, we're so woefully bill. >> Behind where we really would have imagined that we were or the pass for 5 years. We recently reviewed quarter 4 of 25 with our sales tax and sultan. It follows that trend. You know, we saw a little bit less than one and a half one and a half is not a number is
ultimately going to help lot within our structural deficit. Again, very modest growth of 7 new nafta. 71.5, you know, additional million dollars year-over-year. Again, we're looking at our expenditure. Growth is just not pacing. Given sales taxes are most critical revenue source. And Yasmin, as I've got to mention on this side, our overall change year over year is 3.6% in revenues, which is again, an increase in the right direction. But as we get to our expenditure slides, a couple slides ahead. You'll see it's just not keeping pace. >> This pie chart is just a visual of the previous table are still looking at general fund revenues and we show this to always illustrate the fact the property taxes and sales taxes make up over half the pie. These are 2 largest revenue sources for the city. So these are by far the ones that we pay the most attention to do, what we can to keep these healthy. So moving on to the expenditure side of our general fund expenditures in fiscal year, 26, 27, we're budgeting about 233 and-a-half million worth of expenditures and our year-over-year growth rate. Here is 7.7% compared to about 3 and a half percent. A couple sites back. This is where our structural deficits really illustrated. Looking at the top line here for salaries. We have 10 and a half percent increase. This is due largely to several grants expiring that were previously paying for some of our salaries in the general fund. And we will talk about those more in future slides. Most bargaining units are scheduled to get a 4% cost of living increase in 2026. Our professional services are showing increased to a 15.4%.
But that's only 2.1 million, about 600,000 of that is our election costs for next year. Those are costs. We have to budget for every couple years as they come up. So it's not one that we see year to year, but it. It shows a variance as compared to last year. Our vehicle expenses, 2 are going at 6.4% vehicle expenses include everything from gasoline to maintenance to repair 2 replacement. And I highlight this one just to show that this is a pretty major cost for the city that we can't control due to outside factors. The cost of gasoline is going to be what it's going to be. There's a lot of state regulations requiring the types of clean energy vehicles that the city is required to buy. And it is a big category that we struggle to maintain and to keep it a low growth rate. And this picture is an illustration of the previous table. This is still our general fund expenditures by category and again, salaries and benefits are our 2 largest pieces they make up over. 77 1% of all expenditures in the general fund. So while we can talk about vehicle expenses are professional services. It's really just small dollars compared to the personnel costs that we incur. So our base budget general fund expenditures by department. This is the same total as what we've been looking at 233 and a half million that are still our general fund expenditures just divided up differently before we had them by category. Now, this is by department. Our top line includes the cost for all of our administrative departments. The second line down for fire are seen a large variance there of an increase of 13 and a half percent. This isn't typical. And again, we'll have the opportunity to
talk about this more in future slides. You're also going to see some large swings and recreation and transportation and public works. This is a result of a reorganization that happened last year when we moved our parks division over to transportation and public works. It's going to take a couple of years to be able to stabilize our trends here. So we're going to see some big swings and a lot of areas due to this remark. And again, a visual of our departments in a pie chart. Police and fire are public safety departments make up over 65% of the general fund. Handed back over to our cfo Wagner. Thank you, Veronica. So next slide. So what will start to go through Israeli some composition concepts on what's making up are 17 and a half million dollar deficit. >> The first thing I would bring up is that what? That's what this first slide shows, Israeli that that grant funded programs of in response and safer. How much of that is getting made up of our budget versus our ongoing structural deficit. We see there is 13.9 million dollars versus the 3.6 million within those grant funding programs. Next slide. This is really the prior chart put into into a graph to understand how the departments are shaking out from that growth aspect. And what you see here is that the fire department has the largest growth, but it's made up of some specific issues. The very top that Purple Section is the in response aspect of funding going away from the county and and that additional funding coming from the general fund
of 1.2 million dollars. 2.4 million dollars worth of the safer grant expiring, which we no longer can have employees charged too. And then 2.5 million dollars is our projected over on overtime within our but fire department currently which we have corrected within our budget to have actuals match. So really the takeaway here is not a whole lot of increases within admin where pad or some of these other areas within the city. Again, it's a lot of our increased specifically when look, the departments are coming from those reasons. Next slide. For us numbers. People who love numbers. This is for us. This is really that that chart broken down on what's driving the fire department and police departments increases. Next slide. As part of MAY 5th. We're going to Chief Cregan in chief Westrope calm down and talk about over time within their departments. But what we wanted to just go through very briefly here today is really the understanding of what's happening within those numbers. From a big perspective, this first slide shows the budgeted versus actuals overtime for the fire department over the past 4 years. And what you would with the first thing that sticks out to me is that darker orange bar. Its budget. And that budget has remained flat over the past 4 years. Now, that's important because our salaries don't remain flat at the And so there is even heron disconnect here between the math of how pay works at the city versus how are budgeting revenue trying to keep it flat and what we've notices have
really starting in 24. 25 that equilibrium became very, very far off. And so again, we're proposing adding 2 and a half million dollars to the budget for overtime this year to not incentivize more over time, but to really align ourselves to actuals of what we're seeing happen within our budget. The police department broadly the same but slightly different when you're going to see hears the green bars being actuals within the police department, which has been going down over time for the police department and what was happening starting in 20 to 23 is that the city made a concerted effort to start doing this correction of bringing the budget to the actual number. So we started increasing our overtime budget starting in. 23. 24. And then 24 25 to start aligning Then last year we decrease the budget. And what we're seeing is that that decrease in budget doesn't correspond with a decrease of overtime within the department. The reality is that our publics are safety departments have mandated staffing requirements that they need to meet, especially within the police and fire departments, incidents large events can very much cause material differences, especially within police for this number. So we're seeing that our current year, we're anticipating them being well well above budget. Again, what we're trying to do within the coming budget adoption is to really correct that. So in summary, we have a baseline budget deficit of 17 and a half billion dollars. It includes the grant funded programs and positions that no longer have grant funding to support them, which is 19 fd ease. This includes a correction of the pre-existing funding gaps in the public
safety over time of 3.1 million dollars. Of course, we also can treat include are contractually approved compensation adjustments as part of our budget. So I think it's important each time we have these budget conversations to recap what's happened at the city in the past. So I'd like to do that very briefly. Next slide. The first thing this really happened the past year is that I would like to receive into the Finance Department is committed to transparency and communication over the past year. We've done so numerous, numerous different areas. We've conducted monthly fiscal update mean meetings with our leaders representatives with Ali representative trove the agenda of those meetings, those meetings, including a full discussion around the city's investment portfolio. How it works. What's made up of the balance? Both the city's independent auditor came to the team to that meeting along with the city's investment advisor to really break down how we go from a really large number within our investment portfolio to get to our reserve and we need it back at the city's audited financials to give that breakdown. We included a Calpers pension discussion. We included Cip. How does the city have such a large cip program? But yet how does that interact to the general fund as we know our funding sources within Cip are almost all restricted. They come from special revenue for sources that we can't back funnel into the general fund legally. They're there for specific reasons. We included the city's long-range financial forecast. And how do we come up with the assumptions that we make to show those negative numbers and what are we
consider for wage growth, expenditure growth and revenue growth and we went through it line by line. We additionally how the formation of the city manager Budget working group with community members. That group actually meets next week. That's been going on for a while with us and been another great opportunity. The finance department city manager's office to really interacted just members of the public to talk about our current issues. Very importantly, here to me, is that the final line item? Of the Lt fda's sub subcommittee line by Line Review of all departments budgets. What does that mean? That means that our subcommittee over the past year did a thorough review, thorough review of budgets that literally went mind by line to their budgets. That was over 10 hours of review. That was not at the top level, but it was the tell me what makes a professional services within department. And I will say that my takeaway was was from the committee, was these large larger or departments budgets where they have large are operating supplies. Budgets are professional services. They really get eaten away by mandated costs. As Veronica mentioned the slide a few moments ago. Our primary cause of the city are fundamentally salaries and benefits. Next slide. So as we move forward, really, we are conceptualizing our budget process is really we've been in 2 phases. Phase one was everything prior to this year in fees to is what's going to be ahead in phase one was very dramatic. We needed to make traumatic actions to correct a city's deficits that included 15.2 million dollars worth of ongoing reductions decreasing
the general funds work were forced by 54 employees. 10.2 million dollars worth of one-time money to go back and assuring our reserves and voter approved revenue tax measures of the e and f f affecting business licenses and transient occupancy taxes which brought in 3.7 million dollars worth of additional revenue. Additionally, we have like to mention we had no midyear cuts as part of 25. 26, you hear myself for the city manager. Talk about we like to be very intentional with our strategy moving forward on how we address cuts. We do not want to reactionary. We do want to make half measures that then we have to come back to council mid-year to change course. We want to be able to have the proper time develop the strategies. Some of those strategies are going to see here today. This is a just general summary that we've been showing on how the city those 15.2 million dollars ultimately been spread amongst our department so far. So really phase 2 where we're going Next. Slide. Is we started really with what are the strategies that we can start looking at? We've already made very big cuts to the organization. What can be next? And we really workshops indeed some thought exercises and game plan for will. Look at that. Look like. One of those options is what's fix it right away. Let's make a 17 and a half million dollar reduction to the city. That could be a very fell swoop instead of I call dragging this out over a period of time? That's very difficult for communications is very difficult for morale. It's a very difficult thing to do to spread this over time. What if you did it tomorrow? I would say that we have a very large
responsibility to really weigh that kind of concept against impacts the community. The reality is that we want to be able to maintain the services we offer for the community for as long as we can given our reserves that we have at the city. We're looking towards cutting positions that are vacant. We want to make sure that we can impact employees that are currently employed by the city last. We will always want to take a look at what they can seize. We have as a city first and that's one of our strategies considered excited. We took a look at some of the larger pensioner items that we do have the city, one of those being vehicles and really a look at what are our larger purchases within our fleet structure. And how are we funding that in? Is there a better way to fund it? The short answer is yes, we are going to be considering in proposing a financing structure where we can utilize least financing going forward on some of our larger apparatus that will take advantage of matching us paying for the item over the useful life of the item instead of having to bring cash up front, which causes a little bit of war pardon on the organization up front. So little better way to finance larger purchases of the city. Use of reserves that we have a sound reserve, any healthy reserve at the city has of right now. That is a fact. Our issue again is how quickly it gets spent on a structural deficit basis. But we can use utilize a portion of reserves for the next year to help us not make the level of cuts immediately that we need to
make and give us some additional time for strategy concept Development, Inc. The largest financial issues. The city is pensions. You've heard me say that frequently. We're going to talk about that a lot here very shortly. Saw briefly skip over it, but really getting down to what can we do to start bringing this pension problem into control and having powerfully impact our current budget in future budgets and save the city money. And then finally department reductions. At the end of the day we're left with what is the amount that we ultimately we need to cut from the organization. Now and how do we spread that out amongst our departments? So ultimately, this is a 2 year deficit strategy. To address the entire 17 and a half million dollar deficit. We're going to implementing a multi pronged approach over 2 years. You're one we're going to focus on having fewer reductions to the apartment to the apartments and be able to maintain core services. But you're too, we really need to start moving forward with a transparent conversation and thorough analysis of additional impacts here in the future. Again, we've been going through this process now for for what will be 4 years by 27. 28, when we need to start making those actions, we're going to talk about that a little bit more in a minute. Ultimately in your 2, we need to present what are the impacts of the organization? Is the general fund can't find a way to drive additional revenue. So your one again, as we mentioned, we're going to be focusing its strategic use of reserves to partially prevent major cuts to service. We've looked at vacancies.
Vacancies will be our first any type of position. Impact will be focused. Their first pension costs moving. We're going to very large discussion on a moment. After this. And the major apparatus apparatus least targeting essentially apparatus over $250,000. Also it's not just on the expenditure side. We've looked at what are the costs of the season? What are our options towards better recovery? Whether that be pad or with and recreation again, we've made a lot of improvements in the areas. But again, it's how do we drill down even farther to make sure we're getting the best cars recover weekend for departments? As I mentioned. The formal budget that the city manager will be proposing for fiscal year, beginning JULY one 2026. We will be bringing back those cuts to the council on MAY 5th in 6 to review. And as I mentioned the year 2 discussion, I will say it is staggering for us to start looking at some of these year to impacts. We are at a point just with the budget where we've squeezed as hard as we can. And we're going talk about that little bit more in a moment. Next slide. This is that concept. And really what we're proposing is our shahji just put numbers. So as you notice on the topic with a 17 and a half million dollar job deficit at the moment. We're proposing the moment to use a 0.4 million dollars worth of our reserves to address that on a one-year basis. That is the scene. 8.4 million dollars that we adopted as a deficit in the current year. So one way to think about is we're not falling farther behind. We're gonna maintain the adopt a deficit of where we were as of the current year. We feel that we can get we can get a million dollars worth of
apparatus savings from this. Alice versus Cash program basis. Talk about that more in a moment. And then we're talk about it a lot in a moment that we receive 3.8 million dollars worth of savings and reducing our payment to Calpers next year in in function of using our one 15 balance with amending our contract to Calpers. And we have a long discussion on that later. The good news is it's even better than 3.8 million dollars are going to reap a lot of savings from this program that ultimately leaves us with what's leftover that leftovers. That last bullet on the law side is it's the department reductions. The 4.3 million dollars is ultimately was our North star towards what we need to affect your organization with department reduction basis. Importantly, all know that's a lot of numbers. But from my perspective, what that shows is that more than half between the fire apparatus and the pension savings makes up more than half the same amount as our department reductions right? We're addressing half of what we needed to address. They're not even impacting our departments or services to the community. So little bit more about the major apparatus least strategy. Important thing understand is that. This is a good opportunity for us because we have an opportunity to reduce much money much funding the city's dedicating towards future apparatus purchase. But it is not going to extend the useful life of our equipment on the streets. It is not going impact of the for example. We have many fire engines on order right now. We
have 8 engines are order. It does not impact the delivery of those engines. This is kind of the best of both worlds meeting where we reap some savings, but it's not going to impact ultimately the fleet of the city and the negative negative aspect. Again, our goal here in focus is just better align. The payments with the useful life of this equipment. So 4.3 million dollars again of our department target addresses. Ultimately 25% of the deficit. Big picture. Will be difficult to get to 4.3 million dollars. That's not easy. But much better than having to come up with 17 and a half million dollars through the innovative financing strategies that we're proposing and the use of reserves. They will be presented in screwed up my month or about MARCH. It's MAY. I forget what in in the moment. It included a tiered approach, right? We've been talking about how do we tear reductions going forward at this chamber? And really, again, it's that tear of how do we impacts are critical services to the community as late as possible in last. Ultimately we need to develop a plan that sustains the general fund on a long-term basis. It's going to be critical to moving forward. Cyber. So 4.3 million Dollar Department. Target. It. What was what happened was or excuse me, the city manager directed departments to come up with one percent and 3% targeted reductions based on their budgets. So what you'll know is that 3% is over the 4.3 million dollars in the one percent is under. That gives our city manager the ability to review the proposed reductions and move forward. The ones need to be deemed to
happen. It gives the ability to we the proposed reductions on a tear basis of what should move forward. So coming back to scenarios, we've been busy doing scenario analysis over the past year of of what it really takes to balance the city's budget and what that would look like. We ultimately do not want to have a changes to to the cities operating. We do not want to have abrupt changes to the city's budget. So the next future slides, what we've done and are illustrative. They are not being proposed. These are not plans that are moving forward. But what we hope to do going forward it's provide what I would describe of a scaling of our problem. Government ultimately has really big numbers, including Sometimes it can just be easy to get lost in the size of those numbers and really how they layer on to the organization the next couple of slides. We try to do that. So next slide. So this first slide really shows what a 17 and a half million dollar total reduction against our departments on an across the board basis would look like by department to come up with 17 and a half million dollars. The column to the right. Shows what we would need to cut on fte basis to achieve that number. This is. As much art as science here, meaning that we wouldn't be proposing to close every dollar of a deficit with cutting employees that that's not what we are suggesting. But again, it's important to note that that's the size of what we're talking about. And ultimately, if our total general fund is 77% salaries and benefits and a lot of the other costs are mandated. While this isn't the number, I
would say, it's not that far off. It's still a staggering and sobering number. What that would end up paying. The number at the bottom shoes. Well. What if you just didn't include the police or fire department public safety departments against that number and that seems spread. We only get to 7 million dollars as Rhonda showed earlier. 65% of our budget is ultimately made up of police and fire. So when we don't have broader approach trying to fix the city's deficit. We just run into a math problem. This is that same concept excluding police and fire from the 17 and a half million dollars worth of impacts what you would notice that the prior site out around 89 in Ft ease and when we exclude police and fire, we end up with 108 Ft ease. This is just a function of the average compensation of those groups and needing to cut more from different areas that were to make up that difference. I will add as as a know. And again, I this is a note about. Scale and about the size of our of our budgets. But Director Hennessy, when he gave his presentation on public works, says budget to Lts pa he did a really good job of breaking down that public works has 250 employees and the general Fund. But the reality is he has 85 general fund funded positions. A big difference because public works is utilizing all these different funding sources ultimately to make up their budget. And so when we think about it and I look at this chart and I go, 48 employees versus 85. You can't do that. You can't you can't execute that level of cut the that that's just not something that we can execute is a city
administratively or operationally. So there's a reality with these numbers that that's really staggering. We want to provide some context on history of fte count or how many employees the general fund out over time. I think we all can point out the historic events that have happened over this chart. What this really shows us starting in 2002 1007, 2008, what we would call our Pre Recession, general fund number. We had 885 employees in the general fund prior to the Great Recession. That precipitously fell to bottom of 705 employees by 2010, 2011. Well, you'll notice that really over the next 70 years, the general fund crew back to the point of 808 employees. We then took an additional debt. At that time. There was a focus to addressed a deficit within the city. The general fund actually cut a substantial amount of they can positions at that time. And that's what happened in 2020, 2018, 19. And now you're seeing at the end of this chart, really the falloff from our current structural deficit within the city. Big picture to me is this. Frankly. The Great Recession is the second largest economic disaster in the history of the United States. Following greater said, greater session. Right. We got down to 705 employees for that period. We are. We are looking at a general fund fte count. That is at that level or below now. And that is sobering at a certain point. This is just very, very
difficult to propose cost savings measures that don't impact community service to the community. So conclusion. The general has been experiencing significant deficits. Seven's extensive efforts have been taken to address those deficits. We are in far better position today than we would have been without those actions. Ultimately, what will you moving forward is finance along with the city manager's office will be discussing a two-year shot, a g moving forward. Only with only one year of an adopted budget. We're not proposing a two-year budget. But we are proposing a two-year multi-pronged strategy. Very pleased to report that we've come forward with innovative strategist financing strategies to try to mitigate some of those impacts the organization to do some of the bigger financing issues that the city, whether it be pensions, wraparound a little better. Additional revenues are going to considered to ensure the sustainability of organization. And here to scenario will be presented to the MAY 5th in 6 study sessions with the department heads here to help facilitate those conversations of understandings within their departments of impacts of any propose cuts. Ultimately the structural deficit of the city. Next steps is APRIL 21st. That's today. We'll have our pension reduction strategy Study session and we're very excited about. MAY 5th and 6 is and I'm proud of not thick enough times. We'll be coming back for the study session you ultimately we're all leading up to JUNE. 16th adoption. Were we get to say this current year's budget process is over. So with that, we would very much welcome any feedback or questions from this council. Thank thank you, Scott and Veronica, for I now 4 plus years of This really
has been extended conversation. >> Before we into questions, do I recall at a previous meeting here relatively recent previous meeting, you noted that current council was the most courageous and fiscally responsible. You are correct. Memory surfer. My standard always answer here is areas. Yes, Yes, that that is true. But but I will always had. >> It is true. This council has productions in the city that have been historic in needed. And frankly, if they weren't made, we would a very critical moment, a failure at So it is true. We thank you for that. Perhaps a consideration for the future slide deck. Just to have that as a standard. >> Disclaimer at the beginning. And with that, I will turn to I would turn my colleagues questions. Thank you very much. Thank you. The presentation. >> lot of numbers in there they can. >> Sort of a >> cloud. The ability for the layman to understand size of the issue that we're facing. If I recall correctly, that 17 and a half million that's more than multiple departments, entire budgets combined. Is that not? Yes. Thank you for your question. >> So we can I think it's worth coming back on MAY 5th and 6th in giving that illustration. But when we talk about 17 and a half million dollar deficit, that's more than our entire administrative program at the city. So, you know, no more finance department, no more. City manager department. No more. Hr. No more. Any of those
things still don't make up the deficit. So we fundamentally have an operating issue. Thank you. Thank you. And then one of the things front that you mentioned was getting a hold of the sales trying >> get a hold of the trends of sales tax. Can you? Excuse me? Can you give a little more detail as to why over the most recent years? That's been a little bit more difficult than before. Either of certainly. >> Through the covid years and the years leading out of covid many agencies are certainly not alone statewide nationwide. We saw some unprecedented growth in sales taxes, people's spending trends shifted and people are staying home and spending money that might have gone to vacations or somewhere else on taxable goods. And then through covid. There also was a large shift to online spending. So what we saw was some very steep growth followed by some very sharp drop off. And now that trend line is correcting itself. So we are finally getting into a point where instead of seeing negative growth, in fact, decreases in sales tax year over year. We're finally starting to see it stabilize. But the question has been for the last few years is what will our normal growth rate look like? Year-over-year and what's emerging is that it will not look like the pre-covid growth rates. The consumers trends have changed. People are shopping more online. We do not realize as much sales tax here in Santa Rosa as we would. If people want to regular brick and mortar stores. The inflation has caused a lot of strain on consumers as well. There's less disposable incomes. People are spending more on
interest rates and other areas of spending on food and mortgages, et cetera. So we are waiting to see what our new normal will be. But our consultants have advised us it will be less than it was future projections of year-over-year growth for sales tax are looking to be more around 2%, 2 and a half. That's what they're considering to being a little bit more healthy things rebound. So we're just keeping our eye on that as we are coming out of this time of recovery. Thank you. I really appreciate that as much as I would love to expand more on sales, tax and trends and Bradley Burns and all of that stuff, think we can spare everybody. The detail at this point. >> And get more and become probably get more into that on the 5th and 6 as to why. Some of the detailed discussion >> let's see the one thing I want to be >> a little more clear on his is the apparatus leasing. I want to be very I guess I should ask you to clarify or restate. >> This is not affect delivery of apparatus in any way, shape or form. Is that correct? 100%? Yes. This is not affect our apparatus on delivery. Frankly. I'm looking forward to Chief Westrope really talking about this more in the 5th and 6th. But >> ultimately especially our fire flees going to be in a better position than it's been in very, very, very long time. And not only is that the case, but future they're in a much better place as well. We're not we're not kicking the can or borrowing from the future. This sets up future councils future Archie's features CFOs for success there still funding in the future. That
wasn't there. 70 years ago. All right. Thank you. All right. Out few questions. Then >> do I recall correctly over the past few years our budget estimates of been within about a percent and a half of actuals of the end of the year. >> We've been we've been pretty accurate in terms of what our budget and look like. Is that right? We've come in pretty close with in some categories. There have been some swings, obviously in some areas and others. But at the bottom line, our revenues of coming pretty close with a 92%, one percent, 2% and expenditures. >> close, maybe 2, 3%. The closer. But yeah, we are trending very close to what our budgets are paying very close attention and trying really hard to budget and accurate budget. We do not want to be over promising, but we also don't want to be restricting the general fund on the positions and the programs that can budget every year. So trying to walk that line pretty closely. >> The Oscar all ad because Frank is being a bit modest. We've been spot on for really the past 3 to 4 years prior prior to up until covid and since covid. I will add. Aish We need to be modest, though, because we don't know what we don't know. But that's why we take such a critical approach of trying to be accurate within our models, not being not thinking that every day is going to be a rainy day. Not thinking that every reason to be sunny day. >> Important to point out is always that within these numbers that you're seeing today, there is no recession considered and there is no boom consider to be there. We're we're trying to hit the
target. That's really hard to do. We can see that all the future, but at least over the past 3 or 4 years, we've seen that our models are sound. The city You can city had a consultant come in to review our models and they were found to be best practice. >> Thank you for that. I was hoping he would both take more credit because it really has been an impressive accomplishment by that by the department. And it wasn't for my understanding is that it wasn't always the case here. And so but in recent years, we have been very accurate with our with our budget projections and that could give us confidence going forward that we know we know what those numbers are going to be. Another another percentage question. We took the 15.2 million cars that we took over that over the past few years. That's roughly 8% of the budget. What's something along those lines? So we're talking about an additional one to 3%. So when all is said and done, we're likely have to. We're likely the city is likely to taken in excess of 10% budget cuts over the over the past few years. Which is substantial. And add, is that. >> What? It's not just the fact that our we've had to reduce budget is set are uncontrollable costs, whether that the pensions or vehicle costs or all all the cars that we're even seeing with our own personal budgets. The cities experiencing those hits as well. So on the service live remodel, it it's it's expand it 6, its exponential off of that right? It's more challenging than just he cut by 10%. We've had to cut by 10% because we've also taking these large increases in other
areas. Very challenging. Thank you for that. And final question because I really like the fact you put the slide with the number of positions that are funded by the by the General Fund. >> From 2007 up today, the city population is about 50% bigger than was 2008, correct. So even though we then I didn't do that. I didn't do the calculation in terms of going dropping from whatever it was a with a 35 down to 7.31. Substantial 17% caught something like that for those 50% population increase. >> Yes, and I think again, it's important to note that. The city on a service delivery models, a different city as well. So that's not the same. Ultimately our departments can really show this within their data. Very clearly, whether that's calls for service or the amount of regulatory pressures put on them. It's not the same amount of work. It's expansion. Xfinity more than just Rx population. Growth, Cs, it's challenging. >> Thank you for that as well. Those are my questions for the moment. Any else from council will open up to the public? Are there any members of the public that wish to make comment on this item? Seeing none. We'll bring it back to council for final comments. Strong for us. >> Just add on to the conversation that happens. Little bit of going to Garza projections and actuals. I do. And we're going back to 2015, 16 and we see up to 10% difference between actual to the budget. So just want to comment of the stem that was made. How much improved to
really get and be spot on. Thank you for that. MISS Rogers. >> I don't know if these comments are for next session are for this one. Just I guess a few comments for the city manager and the finance team. >> I little reluctant to keep using reserves because I I feel like I don't know if we're going to be able to put them only get under that threshold. We're under that threshold. And I know we're trying to be creative, but we've been doing this for a few years now. And so I am a little skeptical if one more year is going to really. >> Give us what we need in order stop using reserves. I'm happy to to more about the Brad is. Replacement because we did not have that a few years ago. And that was something that I pushed for. And so I'm happy to see that it is evolving. And developing that makes me happy to know that we're not just trying to get get rid of it because we need it. And then I have some concerns department reductions. So I don't know how much Moore our staff can do. With the place and I feel like it is going to get to the point 2, it is going affect our delivery of services. And so that leads me to another question for council is I know this came up before, but what are our core services? And I feel like we always say this is something we need to discuss and I don't know that we've really just hashed out the conversation of what our core services. What do we feel like our our core services are? What can we cut and what can we not cut, although keeps
coming up. And I Councilmember Okrepkie with my sideline of yes said it last time was what our core services. What is it that we must do? As as a city? I say that because I know that. I articles and seeing other budgets that there's going to be some hospital closures of the services that they are providing. And in speaking to some of our state representative is knowing that there is money out there for the county and saying, well, we're providing services wire at the city's getting money, but the county can continue to get money for services that we are now providing that we didn't used to provide historically, but us feeling like we need to provide it because we have programs and they are working. And so there are some some challenges there. So I think if we can go back and really figure out what are as a city are core services that we have have to provide not that we want to provide that that we have to provide because although we've made choices in and thank you for the kiddos, we're probably going to have to make some pretty hard decisions coming up. So we need to know what our core services are that we have to have to provide. And I'll wrap it up by saying that I'm appreciative to to your team. From also appreciative to the exec team and its members for being able to look at some of the cuts so we can make, even though it is really hard and they probably don't want to make any cuts because they know that they're a lot with less and then to our staff who continue to come to work despite all the cuts that were making, despite everything that's going on continuing to serve our
community, our city and our visitors that come like kudos all of you for the work that that you're doing. So I did want put that in there because you guys are taking the brunt of it. So thank you. Thank you. We certainly all all second, back to you, Veronica. Scott, what one of are the parts of your presentation that I most appreciate was at the and when you when you talked about all the work that gone into this. >> And you laid out some of the concrete things that we're doing better now than we used to, whether whether it's looking through alternative ways of handling pensions, whether its leasing arrangements, whether it is prevent time that you in the department's took to do the presentations and long-term finance. MR. C# # # . You know, I had that we had the benefit of of being part of those meetings. That was a genuine culture change for council. And I think for the departments as well, that useful exercise. I think I can speak for for both of us and for our colleague misspent way lows. Really getting our head into the operations of the various departments talking talking about options, talking a challenge is talking about about the effects of potential cots. It is a different lens for us this year as we as we as we look to the future and that happened because your team and all the departments took a significant amount of time to put those presentations together. My hope is that that wasn't a good exercise for the departments as well. Having been through that in in other organizations. I I said that that does tend to spur thinking and spur some creativity when we come back in MAY, to the extent that you're able to highlight some of the different thinking that's emerged, you've already touched on it in part in the presentation. Again, Calpers
and leasing are 2 examples getting council and the department more involved with thinking through budget options. And that's another example. We made some significant organizational changes in in the last few years in terms of combining departments in terms of looking for a fresh efficiencies. As we're telling the story to the public about the difficult decisions that are inevitable, we're going to making them over the over the next few years. To the extent that we can also be showing them how we are doing things better. Yes, we're making difficult cause, but we're making genuine process improvements in various ways that are going to be great for the city in the long term. I think those are helpful to have out in in the public and have the public realizes are happening. Final note in this is at a bit of a tangent, but I did what I did want to note having interim city manager Farrell here, as part of conversations has been invaluable watching Farrell and your team work together has inspired all of us here in council. We're all we're all grateful for that. And we've seen the creativity that that's emerged. So thank you for the all the work that you've done in combination with your team. We're looking looking forward to conversations in MAY. Was that anything else from council? All right. Well, thank you. Thank you for this item. And now we move into another exciting one, Calpers pension funds. Item 4.2, our Calpers pension, unfunded liability expenses, overview and potential cost avoidance strategies. MR. Wagner, right. I'm assuming you're still in the hot seat. Veronica, thank you. All right. Will thank you again, mayor and members of the council finance back-to-back on even more
exciting item next. But we are. >> Fruit world to be bringing this pension item forward here today. With me here today is Mike Myers from any changes. So she it's and I yeah, we're really looking forward to good discussion around around pensions here at the city. I'll give a very brief overview. Pensions are complicated and I very much understand that. But really what we've hoped to do here today is kind of boil down a little bit of history with Calpers and understanding how we've ended up here where we are today, but also much more importantly, is what we can do and really coming forward to council for a first time with options to start addressing this issue. You heard me say multiple times to council that our primary financial issue at the city is pensions. It is pensions expenses. And really this is a way for us to start getting ahead of that on a strategy basis. We're very excited for the conversation. I'll give a brief introduction to Mike. Really this starts with a story. And the story is that the cities pension actuarial reports from Calpers coming out in JULY. This is like Christmas morning to finance directors all over the state to be able to redo these reports. And really the first time I read through it this year, some numbers really popped off the page that had popped off the page before. There was some opportunities that I saw that we hadn't had in the past. And my first call
was to Mike Mike is very modest. So I will not be modest for him. Mike is a leader around the pension issue in the state of California. He's worked with over 100 agencies on their helpers issues. Billions of dollars worth of impacts from from what he's done. And I'm very fortunate to have a relationship with him where I called my can said, I think I've got an idea it's a really big idea and I need you to make sure that it works. And I need make sure that the math is right. And I need some help. Ultimately would like to get some help on bringing this conversation forward in a way that he does so well to help folks understand these issues going forward. So with that said, a live mic get started. Thank you, Scott. And good afternoon. Mayor Vice Mayor Councilmembers. Nice to be here today. >> little more background on nh Advisors. We are a municipal advisor based here in the North Bay have 9 registered advisors. We also have a practice groups. One of those is our pension and fiscal sustainability group. That's one of those that I manage. As Scott mentioned, a lot of our work surrounds education, trying to really translate the complexity of Calpers. So that you all can make good decisions that's evolved into really implementation of cost management strategies, whether those are bonds, one, 15 trust. We're going to get into a variety of options today. We have been kicking around dozens of options of the last 6 to 9 months. So the ones you'll see today are what we've deemed the most viable. We could flip to the next slide. The way laid out the presentation is a little bit of background on Calpers. How
Calpers works will try to keep that brief, get into some of the historical cost trends that have been really impacting some of the budget challenge is that you heard in more detail today and then look at some of the projections based on those latest reports that Scott mentioned. And then we'll really get into some of the options that we've been analyzing that we think works best for the city. So next slide. So high-level summary of what we're going to be talking about today, the city's debt with Calpers right now is 482 Million. This is your unfunded accrued liability. And this is something we'll to find in a couple of slides pretty evenly split between the miscellaneous and the safety plan. For most of the presentation we really wanted to focus in on what attributable to the general fund. And so that number is about 331 Million. There is some good news coming out of Calpers. They have had 2 good years of investment returns where beat their goal of 6.8%. They earned 9.5% in 24 and last year there and 12.1%. So we do think when those reports get released this fall, the city will see a decrease. We don't know by how much yet. So we wanted to be conservative in use last year's report for for all the analysis you're going to see. The city right now maintains a one 15 trust. That's a separate trust dedicated towards pension cost. Current balance of just under 15 million and combined with the internally held pension reserve. That's about 26 million in pension assets. And that's really the foundation for a lot of the analysis we looked at is how
can the city best leverage that 26 million over the next decade or so to avoid future rising costs with pensions. 2 types of payments that all agencies make each year to Calpers. There's the normal cost. And there's the out and the normal cost is the cost needed to keep up with pension benefits for current employees in both employees and employers pay part of that now in a perfect world, that's all you would ever pay. The challenges that over time, Calpers has not met there. Investment targets and they've also changed assumptions at various points in time. And if we flip to the next slide, what happens when that occurs? Is that any shortfall develops? And this is the gap between what the city would need to have to be fully funded. And you can see that in the Navy Blue Bar there that about 1.7 billion dollars right now, the current value of your assets with Calpers as one point, 2 Billion. So that difference there is that 482 million shortfall that you see in that light gray box. Pay that back all at once. That's a big number. So similar to a mortgage, Calpers hammer ties is that for you at a 6.8% interest rate over a period of time. The one thing that will point out here and it will become clear on a later slide as that beyond just the sheer magnitude of that that debt, it's the way that it emirate Ises, that's challenging. So it's not just one mortgage with 30 year payment. That's level is easy
to budget for. It's actually a combination of about 100 different mortgages. They all have different terms looking at Santa roses, what are called his cameras ation basis. They range from about 5 to 24 years. And when you stack them all on top of each other, you get a very irregular shape that's been increasing rapidly next slide. Please. You. Ailes were non-existent prior to I believe around 2003. And that's when the stock market was had pretty long history of generating double-digit investment returns and a lot of the benefit packages that were entered into at that time assumed continued strong returns in the stock market back. I think in 2003 Calpers assume they would earn 8 and a quarter percent. That's known as their discount rate. However, if you look in the top right on this slide, you'll see their 20 year average is under 7%. And they're 10 years. That's about 7.1 in the 30 year is a 7.6. So. Not horrible. But significantly below what they thought they would earn 2025 years ago. And so they've ratcheted ratcheted down their assumed rate of return about 4, 5, times over the last 20 years. It currently stands at 6.8%. They've also been changing other actuarial assumptions. So inflation rates, mortality rates. They've also been foreseen agencies to pay that debt back over a shorter period of time. So 10 years ago they would amortize the unl over 30 years. So more interest paid over time, just like a mortgage. But you do have a lower payment. So the ability
to absorb that was a bit easier. But after the Great Recession, Calpers was such at a low funding ratio that they needed to get more money in the system quicker. So they they shorten the way that you Ailes amortize to 20 years. Next slide, please. This is a graphic from the Calpers website. We like it because it's it's very simple. And it it shows where the money comes from to pay retiree benefits. And right now this is, by the way, this is statewide. So it's not just for Santa Rosa, but it's fairly applicable for for the city. About. 55 1% comes from investment earnings about a 3rd comes from the employer and then Calpers members of the employees pay about 11%. And the interesting thing about this graphic is to really visualize how big this challenge has become as if you would have looked at this graphic prior to the Great Recession, you would have seen the left side of that dollar at about $0.70 on the dollar. So 70% coming from investment earnings, meaning that the middle part, which is what Santa Rosa is pain. It was about $0.20 on the dollar. So anytime that investment earnings don't. Their goals. It means that the employers have to pick up the share. Next slide. Thank you. The as I mentioned earlier, the city has 2 primary plans. The miscellaneous and the safety. There's a little over 4,000 members that are covered by the Calpers retirement plans. About 30%. You correct me if I'm wrong, Scott, but about 30% are active members and out of that amount, a little over 60% are covered under the new
pepper plants. And so these pepper plans provide benefits for employees hired after 2013, they are slightly lower benefit levels and more cost-effective for the city. But we want to just clarify the fact that this is at the bottom of the slide here that nearly 100% of this u comes from the classic plan. So this is a hard dollar amount. It's a challenge that has been a Kurd because of poor investment returns over the last 20 years. I'd like to add Mike, the pepper conversations really critical in how the state lowered the benefits for employees hired after a certain point. >> That really went into effect on JANUARY one 2013. And at that time, if you look to presentations from Calpers or even presentations that came in the city Council back it was after employees because they have a lower benefit, will help offset the costs that the city would be incurring. Now. That did not end up happening for a lot of complex reasons. But fundamentally. Adam Bull is really critical. And that really are large costs here that we can't. There's the uil cost. 99% of that you will cost comes from classic members of the plan. Next slide. Yeah. This section we're going to get into some real numbers for the city of Santa Rosa. This is a 8 year 7 or 8 year history of the u Ale Balance shown in the gray bars. >> And then we've also shown in orange there, the funded ratio and above that in teal is the funded ratio of of year plan inclusive of your one 15
trust assets and really, I think a couple things to point out on this is just how volatile the eu als. So if you look at 2020 going to 2021 that 3rd column there you see a big drop in the uae. Al. That's because Calpers earned over 22% returns. And that's shown at the bottom there. If you go to the very next year. That Gray bar shoots up to 335 Million. That's at 120 million dollar increase in one year because Calpers or negative 7.5%. And so that's really what the city and really also all agencies across the state are having to adapt to is that volatility as will get into. You do have some time to prepare for these impacts. They don't. Hit you with that bill for there's a two-year lag and then they they ramp up the payments over 5 years. So you don't you don't feel the impact and the very next year, but it is fairly quickly after they have a bad year. Next slide. Please. So slight 14 is I think, really important in especially going back to the last presentation you saw related to some of the budget challenges. But this this chart goes back to 2018 and then also projects out to 2048. And this is based off the most recent Calpers actuarial reports at the bottom. There is the normal costs in orange print grows at a pretty linear rate. So pretty easy to budget for. And then you have that out amortization in light blue. There. And if you look back at 2018, can see the city was paying about 20 million dollars combined. Fast forward to this fiscal year in 2026, it's over double that it's
over 40 Million. And then it's going to continue to grow to close to 50 million by the end of the decade before it starts to come down. And this. Really is the it's one color here in light blue. But if we wanted to do a bunch of colors, you would see a 100 different mortgages here that are all have different terms. Red Triangle there. That's really the challenge that we've been brainstorming about in terms of how. You know, let's get creative. What can what can the city do too limit the impacts of what showing that red dotted line because that's about 52 million of additional increases beyond the current budget and preview to some of the options that you'll see later they will address about 80% of that triangle. So, you know, close to 30 to 40 million of that triangle, but not the whole thing. Next slide. Please. So slight 16 is really a really a menu of some of the most common tools in the tool kit that agencies are using to manage pension costs and most of these the city is doing or at least looking at evaluating the first to being well, the first one being prepaying the eu ale or early in the fiscal year. You do get a 3.3% discount. The city has a history of doing this. Cost sharing with employees. The city has done that as well in a fast forward to the last one because we're not going to spend a lot of time talking about that. But there is a tool in the tool kit that involves issuing bonds to refinance the Calpers debt, which Calpers charges us. 6.8% debt. It's known as a pension obligation, bond. We do have slides in the appendix if there are questions about it.
But this is a very popular tool 5 years ago when interest rates worth 3%. And compare that to Calpers. 6.8%. There's risk involved. But there was enough. I think buffer there that a lot of agencies went down that route. This is not been an option executed by any agency and several years now, given that rates are above 6%. So there's not really that much of a Adele to there. And there's a lot of risks. So the risk-reward calculation really isn't favorable right now. So what we really focused and on were the most viable options within the current market environment. And that's the what's shown in teal there, which is a fresh start with Calpers, meaning that instead of those 100 mortgages that you have, you basically request a new payment schedule. C just have one one new layer that's amortized over a fixed period of time. In this example, it's about 16 or 17 years and it's at a level payment. Now, I want to be clear that that doesn't mean that it avoids future you ale coming online, but it does convert all of the current al into a flat payment over a fixed period of time. >> The >> what's shown in orange there is is really using reserves to pay extra. And there's 2 ways that agencies do this. The first teen putting that money into a one 15 trust which the city has a practice of of doing the current balance is about 14.5 million. And then the second one is actually just sending money to Calpers to accelerate the pay down of that Allen.
That's known as atp, should a spell that out there, but that that's an additional discretionary payment. That's also an option. And those those 3 are what we looked at. And we've boiled it down to 3 options for that will discuss on the next slides. >> Thank you, Mike. I want to start by saying on a strategic goals basis as we've been developing the strategies, our North star really for the policy that we want to move forward is that is these 5 points. >> As we want to provide more predictable budgeting that matches expense growth with revenue growth. We don't want big spike in big down. We want something that will match the city's revenues to even out that Calpers mountain that I've talked about before. Ultimately that graph make shows to me, it's it's a mountain. We want to create a mesa. We want to create a tunnel, something that's flatter were manageable to climb. We want to decrease the total amount paid. So if 482 million now we want to pay less than that. We want to pay off the unfunded liability. Quicker. We want to be able to say to the community that we are not just kicking the can bring your payment down lower to push off payments. We want to actually be able to see that we're going to pay off this a very big problem faster. We want to maintain local controls over local funds. Right now we have 26 million dollars worth of local funding. We would like to maintain those funds. We've been very successful, managing
them investing them. We would like to continue that success and continue the opportunity for the city to flexible with those funds. And ultimately we want to also provide the maximum amount of cost avoidance and budgetary relief in the short term. This is a policy ultimately that we want to bring forward that not only serves today but serves the future, but we will also need to recognize that now is a critical moment in the city's financial structure. It's exactly some of the charts that we were looking at earlier on a budgetary structural deficit basis. This is a historical moment for the city that we can address in this way to provide some immediate relief to the organization. Part of that structure is what Mike was talking about. Adverse usage of our one 15 trust. Very briefly cover the history of that because it's important in that 10 million dollars of Pg e settlement funds were deposited into the section one 15 trust as a result of the 2017 wildfires. The advantage of having one 15 trust says that we can more broadly invest those funds versus the city's Reagan regular Treasury. We've been very successful at that at that strategy. And ultimately we've grown the fund from 10 million to 14 and a half as of recently. Now, investments are volatile and I will briefly say that the market has been volatile along with the world over the past few weeks, which has been unfortunate. But again, anticipate over time that these funds do very, very
well. Ed City Council directed once we paid the city Hattie, former p o b van, it had a pension obligation, bond that paid off and the reason past once that happened at that Time Council directed the fat budgetary savings be use towards pensions. We did that for a period of time until the city faced budgetary had winds that we've been facing in cuts over the past year. I just want to add for a note that we have not been contributing to any additional way pensions over the past 4 to 5 years as part of our budgetary struggles. These are prior balances into the fund. And with that, I will pass it back over to Mike to talk about the 3 options we developed. Thank you. And as I mentioned before, there was, I'd say dozens of options. We looked at these 3 are really >> the most efficient and cost effective in really achieve a lot of the goals that Scott mentioned earlier, primarily smoothing that that mountain peak in payments in achieving budget predictability in cost avoidance. But we wanted to look at 3 different ways of doing it because there are some pros and cons of of these options and option one is Julia Hybrid model. So it's that fresh start option where your request from Calpers anew payment. That's level. And then you would leverage that one 15 trust over the next 9 to 10 years, too, essentially have a more budgetary friendly payment schedule that starts off a little bit lower and then grows at 2% a year. Option 2 is really to attempt to do the same thing. But without the fresh start, so
primarily relying on the one 15 trust to offset those general fund Calpers costs create a ramp up payment schedule for better budget alignment option. 3 in a similar way. It's also to smooth out that peak. This required quite a bit of of extra analysis because we wanted to figure out which pieces of that the unl layers to pay off to that would best move that peak. Now the downside of this option, as of course, you would be liquidating all of your one 15 right now in order to effectuate this option. Next slide, please. So this is option 1, 1, thing to note here is that you'll you'll be looking at a similar chart for all 3 options. And I think take a moment to just say, this looks a little different than the previous slide because we aren't, including the normal cost. We wanted to really boil it down to just what you see in light blue here. This assumes that the city executes a fresh start that would level out payments at around. 32 to 33 million a year. And then instead of having those payments right off the bat, you would actually start withdrawing funds from the one 15 trust in a methodical way over the next 9 or 10 years. So ultimately the general fund is pain. What shown in the orange dotted line. So anything above that orange dotted line is paid for by the one 15 trust and the amount of budgetary cost avoidance there under this
scenario is 37 million dollars. And that's from 2027 to 34 and take another opportunity. Just to say this is a snapshot in time. So when the new reports come out in the fall or, you know, next year when the new reports come out that, you know, the shape is going to continue to move a little bit up and down. Next slide, please. I'll add on this slide. This slide really a summary of those of the prior chart. And, you know, you all know that I love screen with a whole bunch of numbers on it. >> So I'll just point out a couple. My favorite, though, is that one of the bottom right in red that shows that over the life of this program, the city saves. 36.6 million dollars. Very substantial. You'll know at the very top of that column, though, is the 3.8 million dollar number that was mentioned earlier tonight. This is a way that we can provide some budgetary relief in the next budget. The great thing is that is 3.7 this year. 4.4, 6.9, 6.7, 6.4. This is a program that's not just going to benefit the next year, but really the the whole 5 year forecasts forecast for us. It is going to benefit. Now when we look at the chart, it's important to note that there is a difference. There is a delta. Once we start getting 8, 9 years out. Right in Phiri. If nothing had changed with Calpers that our payment would have started going down earlier. I want to really mentioned a few things. One, this strategy hits all 5 points of what we were trying to do on a policy basis. This is 5 for 5. If we can get to 3 out of 5 on a policy that's awesome. 5 out of 5 is even better. So it pays off the
debt earlier. Additionally from the future programming of the city's perspective, it is much easier to maintain budgets, then create them. And ultimately 33 million $1.32 million dollars 8 years from now is much less than it is today. And it gives future councils and future city leadership. The ability to have a more predictable structure for paying this debt down in the future and we will have created the budget for them to maintain over the next period so we are setting them up for success. The greater success, though, is when you look at this chart and you see 2040, to 2043 where this falls off to 0. The city has not just pension as what I considered an unfunded. Why ability or program within the city, not all of them are so nicely put onto a financial statement or easel or more transparent than our pensions. But we have structural issues financially with the maintenance of our buildings and infrastructure. Our streets, cetera. This is going to give folks at that time and ability to make substantive changes in those areas that can happen when you have large amounts fall off of your budget. Very small fall officer. Very challenging the program. But large fall officer way that we can in the future. Really large structural change in the city financially. It can go back to one side. Not to dwell on all the numbers, but just to point out, one assumption that I wanted to point out that we're
using, if you look in the middle there at the one 15 trust withdrawls and then if you go to the bottom, it's close to 30 million of withdrawals. >> That's a little higher than the 26 million we talked about earlier in the reserve. We are assuming it continues to earn are being pretty conservative at 5%. So this option as well as the other one, 15 trust option would look a bit better if we were using current market rates. A lot of one 15 trusts earning 6, 7, 8%. But we wanted to be conservative here. Next lot. Option 2 is similar. But again, without the fresh start. So essentially you would be utilizing the one 15 trust assets again, growing at 5% a year over the next 6 years. And the general fund would be on the hook for what shown in the orange purple dotted line there and that cumulative amount of cost avoidance under this scenario is 30 million dollars. So about 7 million dollars less than option one. It is a little bit of a quicker depletion of the trust as well. So 7 years versus 9 always nice to you know, keeping the one 15 trust only helps with future flexibility. In case there are some down terms with Calpers. If you look at the blue column on the left, this is your current payments. And then the blue column on the right. Those would be the new general fund payments. And this is just the source data from the chart on the prior page. And then in the bottom right there is the total savings again close to 30 million dollars. Option 3 very similar looks to option, too. But it mechanically is a lot different. So under this scenario, you would be essentially liquidating your
trust, taking that money, sending it to Calpers and choosing which pieces of the unl to pay down such that you're left with a payment schedule that looks like the dotted green line there and that that's about 32 and a half million dollars of cost avoidance over the next 10 years. So a little bit more than option to. And that's really a function of interest rate assumptions. So if we want assume 6.8% on the one 15 trust, those savings numbers would look exactly the same. 27 just a bit. Comparing visually all 3 options. Again, very similar concept in terms of smooth in the peak option. One is a bit different in the sense that it does provide the lowest payment over the next 7 to 8 years. And then it does have that higher payment out in the out years versus the current schedule. Also in 2004, the one is one that orange line with As Scott mentioned, this would offer paying off the debt 6 years earlier than currently scheduled with Calpers. Lots of numbers on 28. But this is just a summary of all 3 options. Again, glancing at the red at the bottom, I think is the easiest way to compare will just stay on this slide here on 29. The we wanted to show the cost avoidance both in the very near term as well as overall. And you can see there for option one. It's about 4 million dollars higher than options. 2, 3, over the first 5 years. It also provides the most cost avoidance over the long haul. 37 Million. Options wanted to do allow the city to maintain
that trust. Do have more local control over those investments. Little bit more budget, flexibility and liquidity to deal with unknowns, both with Calpers. And then just with the general economy. Option one does check the box on the city's objectives of having a more predictable payment for the longest period of time. So going out, 16 years and again, it does retire the unl debt 6 years earlier, whereas options 2, 3, maintain the same final term of that debt. So I think we hit it on the last slide. But option one checked all the boxes. I would say that all the options are are strong options. Some do come with some downside. I would say the atp option, even though it was this, you know, ranked second in terms of cost avoidance, I would. Caution against that option just knowing that you be liquidating your entire trust at one time. So in terms of future flexibility that does limit the city quite a bit. But again, it's all the objectives that Scott laid out earlier. I think this Scott could probably talk about this in more detail. This one key step in the process. We've talked a little bit about long term continued funding of this challenge. It's not going away even with any of these 3 options. Looking at a policy. Hopefully one that continues to try to funnel more money towards the trust or towards an atp knowing that this Calpers challenge isn't going away you know, we've had a few good years. They're currently actually having a good year again right now, which is good news. But we all know that if
there is a recession or they have a down year, it's going to be significant impact to the to the u l. I know it's got mentioned when he reached out about a year ago, we were talking about Kobe's. We're talking about the risks. We can talk a lot about that. I would encourage the city that if you were wanting to learn more about those, the risks involved, how to quantify the wrist, how to mitigate the risks we could do that at at future workshops and such. So. Thank you, Mike. I I'd like to add it just echo. This is really the continuation of of a small seed planted on a pension issue that's really come to fruit today in a way. But >> there's continued work to be done here as we move on to the discussion, I would mention that option one is is the option that see manager in the Finance Department are recommending the council take action on that action with councils direction today to come back, we would come back with an amended contract with Calpers to move us into their fresh start program. I want to be transparent that that does lack the city into that program is just like refinancing your home mortgage. Once you do with the bank, you can come back later and say want to do that. So you do move forward with that structure. That is restricting. But at the same time, it does not restrict the city in the future and future councils to take additional actions. We monitor the people be situation frequently to ensure that this is or isn't a moment to be issuing p o I don't see that happening
anytime soon. Given the rate environment and overall debt market within within I did the markets. In the future. I absolutely could see that being an option for the city and one that would make a lot of sense from a risked basis. It doesn't prevent future councils. Additionally tours. We are in rainy days now. Readings we do eventually become sunny days. And once we have some surplus is within the general fund of the city, looking at that and going, hey, we got so much benefit from this one. 15 trust were pulling some funds away from it. Let's replenish this and double down on this. This thing that's worked really well. So while this is a restrictive action moving forward, the same time, there's still a lot of options and tools in the toolbox. Moving forward to make an even bigger dent in this huge problem. Certainly any at any of these actions are options put before you especially option one, provide an action that the city has not taken to date at this level. That would be very, very impactful. So with that, our presentation is over and we welcome any questions or comments. Thank you It's so reassuring to know that you're both waking up on Sunday mornings and just breaking out to excel to do some pension modeling. That's that's what we want to hear. >> Looking at my colleague's questions. MRS. We'll pretend I know everything he just said first of all, just begin with that. Rca Peace. >> And looking at how much funds or or we've set aside for our future projects. I begin by asking this question. Where does our money was side
for our community improvement projects, for example, the library, the money we use the money for the purchased, the property we we funded studies. The rest of the cast was that cash? As precaution? Thank you very much council around for So. >> The city's funding for cip infrastructure. To my mind comes from 2 places. Technically called 3 places. But I'll talk with the 3rd one last first and foremost is from restricted funding sources like special revenue funds, gas tax. Know, county measure and funds for parks. I park development fees from developers write those are very, very restricted and they can only be used for certain purposes. All right. That's one. The second area that the city historically over the past. 20 since the Great Recession. Is what we call one-time money. Meaning that we want to fund the library in Roseland. We're going to we need to find one time money to do it. It's not does not live within our budget. Its not permanent our You got it arpa or or pg e funding confirms what they they they arrive and then we decide what to do with programming them. The 3rd place they come from his the general fund, meaning ongoing capital. Dedicated capital funds coming from our general fund. And so I'll put that in perspective of our 200 we'll call it 50 Million Dollar General Fund. 1.2 million dollars of that is dedicated to that area. And even that 1.2 million dollars I would describe as restricted because real use for ada funds, et cetera. So so the house, which lives in, it's general fund for the time being into a money spent it lives in the cip from. But yeah, sweet for
what's keep the finance at the high high level. Of course. Yes. I was trying to speak to earlier. Was that the hope? Of doing this program is to not just address pensions. 2 set this city up on a path in the future that you can address these larger structural inadequacies within our budget that frankly, other agencies Other agencies do have capital funds within their general fund. They do have facility replacement funds within van. They do have it software replacement funding within their fund. I I will speak for interim city manager Farrell. That was one of her our for very first conversations was, you know, Scott, explain to me where those funds of within within the budget and the answers they don't. We have already struck down that operating as I hope it does. And the point being is. And our general it simply was sides there and perhaps others districts shuns that would impede us from holding interest bearing account percent, which could offset the interest, which would be paying Yemen is Asian and and the Calpers. So that's and that's all to path that I want take. What you just did. Yes, thank you. And that's exactly right. And that we are statutorily very, very restricted for the general Fund investment portfolio. We're very proud that we've seen better results of late. But juxtaposed against a pension system with a 6.8% interest rate. That's that difference. And if we were a private organization that can assume that level of risk like an insurance fund, cetera. We could do much more creative financing to try to tackle this issue that we in public sector just can't do. And I'm I'm I'm glad for clarify that
has that was one of the comments I've been hearing is why don't we hold these accounts in an interest-bearing account to counter the reality is we are restricted from doing so. And thank you, councilmember. I will clarify. All of our accounts are interest bearing. It's a matter of how much risk we can get. Can't. Yeah, I can match my 4, 1, k or my, you know, private investment with the season is best for its far more restricted. Thank you. Other questions. One clarification so tiger stand correctly that with the pepper liabilities are in essence, fully funded with percent to being fully funded. It is the pre 2013 liabilities. That's where our issue is. We're paying back that chunk of liabilities. >> Yeah. When we when we do analysis of where that you come from, it's fundamentally the generations past. It was the enhanced benefits of the prior workforce against investment frankly fell apart during the Great Recession and the dot com bubble more great recession. But that's really the driver of where that you will came from. 99%. Yes. Ok, thank you. If there are no further questions will open after the public remembers the public wish to comment on this item. Seeing none. We'll close public comment get back to the dance. Any final comments? >> Vice mayor Things that you're looking for direction at this? Yeah. And I'm nowhere near as a smart finances. You are as city manager and you're both recommending option one and it makes a lot of sense to
me and my limited understanding of our unfunded liability. I'm I'm good with option one going forward. As Rodgers. >> It have a quick question. So in in the slides, it said that there. I don't know. All explain it away and not explain it. When I worked at the county, there was a line item in our paycheck that we were actually helping towards the unfunded. >> Liability. Are you stating that our employees have that? >> They do. All of our bargaining units have all agreed to pay above the employee required cost to Calpers. That almost all the units are about one and a half percent. There's a little bit of variance and there doesn't bear with me. But really that happened in 2013, 14 area as part of negotiations where the sea you see the city the believers negotiated to have kick in college to get just like the county. >> Does have a sense it. It does not have a sunset that actually really goes to it. >> There. >> Pension contribution. That right? It does. So if someone were to separate from the city prior to vesting with Calpers, they would be retaining the amount they put in. And let me just be very wonky. Technical. Any benefit or agreed youth sunsets with the ending of you right. So if want to say is right now, there is no sunset for it. Correct. >> And just because you are looking or direction just because you guys want to do
with one. I'm going to go with 3. >> like I'm going >> I think we have we have experts. >> For a reason and I'm happy that you have. I know you've been working on this or a few years and I'm happy that we have interim city manager here who has a background finance. So you guys can talk about these things on Sundays, which I think you should have better self-care, but we're not even going to go there right now. I'm happy that you're looking at a way to help the city get from under this. And I would like us to look at a policy to address how we're going to move forward. So that we don't difficulties like this in the future because we don't know what things are going to look like and in the future. So I would be interested in seeing a policy to help with this. And that just you and sorry, but through the I would be remiss to not also say thank you to see manager Farrell. >> You know, it's refreshing and inspiring to have her come in. Look at this policy and get very clear direction and motivation to move forward and this and to have or do the same analysis and come to the same conclusion as the finance This is awesome. Move forward and I just like to express my thanks. So thank Thank you. MISTER Alvarez. Or just say one and just let Mike Real. But being that, we have Mike here with us >> it gives me great confidence that not only your plight years experience to coming up with something
outside of the norm, but that's also recognized to go outside of yourself. To even further that strategy. And that does give me a great sense confidence in you, sir. And you said the word seed. So with that, just say this. We plant a seed for which trees say we will never enjoy. And that's where I think you're going with it. >> Thank And yes, obviously option one for me to by all means please continue the process. And thank you for the creative work on on both your parts and from our city manager, part table engineer this kind of circus savings at this time and not just savings right now, a much better going forward that future council members and future city managers will. Thank us for thank. Thank you for very much appreciated. Thank you for all the work on this. And by all means let's let's let's see if we can deliver this improvement to the city. All right. With that, we want to our next item, which is bear with me for a second. Would say All right. I'm hearing I'm hearing shouting from the day asked that we need to break. We have to maintain a record today, sir. None of us can leave. So with that, let's take a let's take 5 minutes. Be back here for 5. All right. Welcome back, everyone. The time as White 4, 4, 0, 9, and we can reconvene to open session. MADAM City Clerk. >> Thank you. Mayor Councilmember Rogers present. Council members, MacDonald Fleming and when we alos are absent councilmember rather as President Vice Mayor Okrepkie
here, mayor staff here. Let the record reflect all come to members are present with the exception of councilmembers been Willows. Fleming in MacDonald. >> Thank you. And I should note that even though we started 45 minutes late in our last last session, we have almost got ourselves back on time. This is how we work in the city of Santa Rosa. Right on to item report. If any on studying closed session. MADAM City Attorney. Thank you, MR. Mayor, there's no reportable action taken in closed session today. We just conducted study session on the General Fund Budget update as well as Calpers pension, unfunded liability. >> And that is the end of that report. >> Thank you so much. So on item 7.1. Our proclamation in honor of sexual assault awareness month. Ms Rogers. >> Thank you, mayor. Whereas Sexual Assault Awareness Month is intended to draw attention to the fact that sexual violence is widespread and has a profound and lasting impact on every community member of Sonoma County and whereas Verity sexual assault prevention intervention in Healing Center works with over 1200 survivors in Sonoma County every year with a 24 7, 365 days. A year crisis and support line and Taylor advocacy services at any point in their healing in Justin's journeys host over 200 presentation and events reaching over 14,000 community
members with age appropriate outreach and education to prevent sexual violence. Encourage people to show up for one another and recognize signs of unhealthy relationships and provides hundreds of sessions of individual and group therapy to support people and processing and healing from trauma. And whereas nearly half of all women will experience some form of sexual violence. At least one in 6 men have experienced sexual abuse or assault youth under 18 people with disabilities. People of color, queer transgender and non-binary people, homeless people, undocumented people, youth in foster care and people of other marginalized. Identities are much are at much greater risk. And whereas over 18,000 members of the military and over 80,000 people who are incarcerated experience sexual violence every year. Let that sink I'm sorry. That's a lot of numbers. That's a lot of people. Now, therefore, maybe resolve that. Our mayor Marks tap the mayor of Santa Rosa on behalf of the entire city council in recognition of our community do hereby support the efforts of varity and encourage every resident to actively engage in efforts to in sexual violence, including conversations about what sexual violence how to prevent it, how to help survivors of all backgrounds APRIL 2026. Is sexual Assault Awareness
Month. Thank you, MISS Rogers and do we have on this fine from there to here? Please go ahead to the floor. Yours. I thank you. >> Thank you. City Council Santa Rosa for this proclamation and for recognizing Sexual Assault Awareness Month. My name is Rebecca, a fine and I'm the executive director of Verity. This exact acknowledgment matters. It matters because sexual violence is often invisible carried quietly, sometimes for years or even decades. And when city and elected officials take a moment like this to name it to recognize it. It sends a powerful message to survivors. We see you. You are not alone. Ed Verity. We have the privilege and the responsibility of walking alongside survivors every day. Every year we support over 1000 survivors, notably approximately 20% of whom are children. Through crisis intervention, advocacy and healing services. They come to us to support their healing and justice journeys all while trying to hold the rest of their lives together. Their families, their work, their school, their community. In addition, we work hard every day to prevent sexual assault from half getting in the first place. Our team is in schools and in the community sharing age appropriate messages to kids as young as 5 with the goal of supporting people in understanding what healthy relationships look like. What cause consent means, how to look out for one another. Keep each other safe and much more. And while our work deeply rooted in care and connection,
it is also shaped by a constant reality that funding for these services is fragile. The need has not decreased resources often do sustaining this work requires ongoing investment, both for responding to harm and also preventing it in the first place. This year in the lead-up to Sexual Assault Awareness Month, a new revelation related to a cause near and dear to our community came to light. Chavez, revered civil rights leader had groomed abused and raped women and girls who what he worked closely with. Dolores Huerta and others carried these experiences in silence for decades for fear, for fear of undermining their movement. And survival, dignity and justice for so many. And not being believed when speaking out. Against this powerful man. That fear that tension between speaking truth and protecting something larger than oneself is something that many survivors of sexual assault understand deeply. The experience of holding harm while also feeling a responsibility to family community or a broader cause is a reality that far too many people navigate. Just last week, 2 United States congressional representative stepped down from their roles after allegations of sexual assault came to light. There is said to be a whisper network of people who knew about and protected this behavior. Is it shocking in our line of work to hear that men who hold positions of power have caused this kind of
harm. Unfortunately, not really. But the questions inevitably arise around the validity of the stories of these brave survivors and their motivation for speaking out. Are indeed a shock. Every time. How are the stories still met with doubt so often, despite all of the data in the history? It underscores the sexual violence intersects with power, white supremacist, oppression in history. And it reinforces why our response must be thoughtful, inclusive, rooted in justice and clear in one message. We believe survivors. Survivors are not alone and do not have to carry this burden on their own. We will not tolerate power base harm and violence. So today we accept this proclamation with gratitude and with a call to action. To continue building a community where survivors are supported without hesitation and with the resources that they deserve to heal. Thank you for standing with Verity and with survivors this month wastes. Rebecca, thank you so much for coming. Many of us in this room were here for the Public Safety subcommittee this morning in Verities work. >> With Srpd with with our Code Enforcement Office to prevent the sexual of to help the victims of sexual trafficking. So many of whom are going through. Suppose decides partners in the city. Has been what a wonderful partner for Srpd done wonderful things for and again, the victims and some the presence residents of our city. So thank you for being here today. We want to do a photo-op, but before you that are in open open up to members
of the public when anybody else like to speak about sexual awareness verities work. Seeing none. We'll close public comment. Rebecca, want come down front will do what we do for Thank you again. Rebecca and Verity Verity Verity, when we're on to item 9, our city manager and city attorneys reports MADAM City manager. Thank you, mayor and council members. Good evening. >> We just pull up my report to provide a few updates on some community. Events are coming up. So the first update is we're coming up on Earth Day as you know it or stay happens every APRIL and for us, it will be this Saturday. APRIL twenty-fifth from noon to 04:00pm at Old Courthouse Square in downtown Santa Rosa. This free. I was stress free, family-friendly, 0 Waste Festival brings the community together through fun activities live, performing arts, great food and inspiring exhibits that raise environmental awareness. So if you need something to do with the kids this weekend, please come and join us. But this Earth Day festival, the very next day, everyone is invited to the Wild Fire and Earthquake Safety Expo on Sunday. APRIL 26th from 10:00am to 03:00pm and that will be at the Sonoma County Fairgrounds, this free event helps community members learn how county and city emergency response teams work together to keep everyone safe during wildfires and earthquakes. You also discover how to better prepare yourself and your family, your business, your
property. And let's not forget pets and even your livestock. And that's this Sunday at the fairgrounds. Next update is that construction has started on new electric vehicle charging stations in downtown adding 6 level 2 Chargers and to dc fast Chargers at the parking lot and 7 35th Street funded through parking revenue and ap Ginny Grant these improvements support a more sensible and a more sustainable and welcoming downtown. And next we have applications that are now open for the community promotions events, support program, which supports nonprofit community-based events that are free and open to the public. So if you're planning an event between JULY 2026, and JUNE 2027, we encourage you to please apply at sr City Dot Org. Backslash event support again. If you are planning your nonprofit and you are planning a community-based event that's open and free to the public and you need support. Please apply at City Dot org. Slash events support and last but not least we like to highlight the city of Santa Rosa Merit Awards which recognize local individuals and organizations whose volunteer service makes Art City a better place to live. If you know someone making a positive difference in our community, we encourage you to submit a nomination at sr City Dot org slash merit awards again. That's sr City Dot org. Slash murder awards.
If you know of individuals and organizations, volunteer service is making Santa Rosa a better place to live. That's all I have. Mayor, thank you. Thank you. MADAM City, Attorney. Thank you, MR. Mayor, I do have my monthly report of settlements and active litigation >> we had one settlement that was previously approved by council in closed session that was finalized in the month of MARCH. That settlement relates to a claim submitted by Sami Good Arrow in JUNE 2025. Alleging that Santa Rosa Police Department made unlawful entry into our home. The city paid Miska Darrow $200,000 for a full release of all potential claims with respect to ongoing litigation. Our caseload remains consistent with 31 current litigation matters. We have trial dates assigned to approximately a quarter of the trial level matters. And there are 4 cases currently on appeal following rulings in favor of the city at the trial court level. As always, we try to resolve smaller cases at little or no cost to the city. And that concludes my report. Thank you. Would any members of the public like to comment about the report? >> Seeing none. We'll close public comment we will move on to item 10 statements of abstention recusal by council members. I hope we don't have any of these given our numbers. All right. Seeing seeing We're going mayor and Councilmember reports. Any reports this this week? MR. Alvarez. Couple days ago. I really want to come in our police chief a couple days ago. We had a safety or public
safety meeting. >> And are up in Roseland. >> And what I wanted to to comment about this meeting is that he brought the be cops with them. And this is a great opportunity for the community to meet officers that patrol their home. And I thought that was exceptional as a put faces to names and some cases. So definitely a props or chief. Think right >> It's ok, I mine is very short. Mayor. And I just wanted to give a shout out to orange theory. Fitness for their 10 year anniversary here in our community, they are a local family that decided they're going to open a gym to help people have better health and they've been thriving for for 10 years. Here at cutting also there within the city limits. And I love it. They made it through covid. Their membership is very strong in I go there all the time. So if anyone wants to meet me there, I will see there. But I did want to give a shout out to them for the hard work that they're doing to fellow Centre, Rosie and Zahn. They're locals to to be healthy, mind body, the spirit. Thank you. Thank you very much. Vice Mayor. >> Thank you, MR. Mair a few things. Not yesterday, but the money before that at the ctc Summit County Transportation and Climate Action, Climate Authority meeting, we had a vote to finalize the coordinated claim for the mascots pro program, which was which is the real lining of multiple >> transportation agency so that we can better move our. Residents around in a timely
manner, not have a bunch of wait times have you know, people trying to get from Cloverdale to Petaluma have to take 2 hours to do it. Those kinds of things. Unfortunately, that vote kind of fell apart at the last second for a couple of reasons, And so it will be continued until MAY where we will see it again, but that the delays, the funding for the mascots we had a couple of abstentions, one, no vote. And then unfortunately, a few alternates, I think about a total of 3 alternates were arranged. We had empty seats and so nothing could be passed. We couldn't get to the required amount of votes to pass it. So >> at this point some of the major transportation agencies such as our own. >> Our kind of float in the going to have to foot the bill until that gets past. Unfortunately. >> Which I don't think will be a problem. It's not a ton of money. >> We will get reimbursed through the funding mechanism did claim funding mechanism. That's the way it is. >> So just a plea to my fellow colleagues that when we have alternate make sure alternates and you can make it make sure alternate show up because there could be real repercussions soon as we saw Ctca. >> On a happier note, the next day we went we had the Avenue groundbreaking for the rematch and project >> this is something that is a big deal. Looks at one of her last major infrastructure projects in the city of Santa Rosa Fire recovered from 2017 Tubbs Fire. >> And it is a it is the physical manifestation of some of the mental emotional scars that a lot of our residents throughout Santa Rosa, Kerry from that night. So to get it
repaired, get a fix and improve upon better opportunities for multi-modal transportation and traffic calming measures and beautification is a huge deal. When other things on a happier note to touch on is myself and the police chief were asked to be celebrity judges of a barbecue competition. If we can qualify or sells bar is as celebrities at the barbecue competition to battle the bruise, there's been going on for 29 years as the largest and oldest beer competition in Northern California in this year's estimated raised over $60,000 for local youth charities. So that was really exciting to be a part of that. Also proud to report no incidents at the event, it was a great time. Great food, great people. Great music. This past Saturday, we had the >> Pat Tillman run on a run. The Pat Tillman Foundation holds every year run down in Tempe, Arizona. For those of you Pat Tillman is Pat Tillman was a college football player who was drafted into the nfl after SEPTEMBER. 11th resigned from the nfl enroll in the United States and was deployed in the range Afghanistan where he was ultimately killed in action. And the Pat Tillman Foundation carries on in his honor, leadership training for veterans and their families. So it is becoming a tradition for my family to participate. My son came in second overall running 4.2 miles and 31 minutes, which I think is a ridiculous time. But I'm very proud of him. And also very grateful to keeping veterans local for organizing the event we hope to grow in the coming years. And last we had the public Safety subcommittee
meeting this morning and the mayor still a bit of thunder during the last item of how great a job the team has done on. It was a massage businesses, but I will say one thing usually at night I use some sort of white noise to fall asleep, but I MAY just use replay the public comment from that item so I can calm down and have a good night sleep. It was a about 15 minutes of just praising our staff and our efforts as a city to bettering the community. And it really the combination of efforts from the people who are living the life on the streets and at the street level and seeing what's affecting their communities. City staff police, nonprofits and working together a great outcome. And it the praise I joke about but is rightly deserve for all the people involved who have done it. So it was great. Great experience morning. Yes, it was a Templet indeed for what public comment should be. I think when showering praise council and staff, I'm glad that a few of you mentioned the the celebrations we've had ground breakings ribbon cuttings for for public works projects. We've got about 100 million dollars. More of those to come just this year. So we talking the bike ped Overcrossing Hopper Ave. >> More more streets, streets, streets and bridges to calm. I let's see in terms of other updates I had we had mayors and Councilmembers association last year or last week. We had an update from Centre County Parks and their measure m Bond measure where they're going out to do keep all in all of our county parks. Well funded. There was aviation commission meeting this week and I am a
representative of the aviation Commission. >> a bit dry for those of you are not list a living in West County. We were talking about the exact altitude at which plane should be leveling off and where they should making their turns. But it was in service of a of a a I well intended plan to lower the noise levels for West County in particular. The airport is currently getting about 26,000 complaints a year given the the larger jets flying more frequently right over houses in otherwise quiet West County. And so the airport is trying to do more to prevent noise out there as well as for cities like Santa Rosa and Windsor. And then I also had a chance to tour date. The geysers this week are the world's largest geothermal field. It's kind of a it's kept a secret in Sonoma County. Not not as many people know about it as they showed that we have the world's largest geothermal field here and the city of Santa Rosa pumps, 4 billion gallons a year 40 miles north of 4,000 vertical feet to make those fields possible where we generate 700 megawatts of electricity powering frankly, most of the county and some in Mendocino and with Sonoma Clean Power, we're looking to essentially double that production capacity, which would be incredible for the entire North Bay. So a great chance to be up in the geysers again. And just marvel at the engineering there hope for a significant expansion of the year in the years to come. I think that's it for our reports. And when any members of the public like to comment on any of our mayor and Councilmembers reports. Seeing none. We'll close public comment and we will go on to actually 11 item. 11.2, speaking of airport, we've got
select are give some direction to me for voting on the Sonoma County mayor and Councilmembers Association city selection committee with reference to interest in. I believe it's the the airport, the airport land use Commission. Ms Rogers, I'm gonna turn this over to you and to make a motion. We can have discussion. Thank you, Mayor. >> I would like to make a motion. >> Regarding letters of interest to the airport land use Commission authorizing the mayor designee and authority to vote on. The late nomination or recommend station any of my colleagues have. A suggestion. I think there was only 1, Yeah. All saw second was that part Kelly. >> To >> Vote for Kelly. I'll second that. >> All right. We have a motion a one moment on word from our city attorney. All right. Thank you for your patience on a little bit of legal drama there, but does not apply to this. This this item. >> any I any public comment on the item. 2011.1 regarding the mayor and Councilmembers appointment to the airport commission. >> Seeing none. We'll close public comment. We have a motion a second by MR. Alvarez, any final? Found this caution. Seeing none. MADAM City clerk, you can call the vote whatever you're going to be reading. Thank you, Mayor. >> Councilmember Rogers, I. Council members, MacDonald Plumbing and then we or absent councilmember Alvarez. Vice Mayor Okrepkie. I mayor stop.
Yes. The motion passes with Sepp us for affirmative votes with councilmembers been Willis. Fleming in MacDonald Absent. >> Thank. Thank you very much. We onto item 12 approval of minutes. We have 2 sets of minutes to review today, the APRIL 7, 2026 and APRIL 10th 2028 2026 rather with the MARCH 24th 2026. Minutes continued to a date uncertain. Any edits to the minutes. No, at its any public comment on the minutes. Seeing no public are seeing no public comment and no edits we can adopt. Those minutes submitted. Thank you very much. MADAM City clerk, which brings us through to consent. Vice mayor MAY have a motion. Actually before we do apologies will do again. We have items. 31 to 13.8, any questions, any any consideration? Seeing none. We'll open up the public comment. Any members of the public wish to comment on a cause and many of the consent items. Seeing none. We'll close public comment and now rain back to vice mayor for a motion move to adopt consent items. 13.1 through 13.8 second, it. What a near tie will give not want to MISS I've motion by MISTER Kraft in a second by MISS Rogers and MADAM Speaker call the vote whenever you're reading. >> Thank Councilmember Rogers, I council members, MacDonald Fleming and then well, as are absent councilmember Vice Mayor Okrepkie, I and stapp. Yes, the motion passes with 4 affirmative votes. Thank you
so much. >> All right. Just double checking to make I'm not missing anything by it. Looks like we're gonna move on to item 15.1. Nick, you are in lock because we're going to start our report. On a day and the approval of the preliminary fiscal year 2026. 2027 regional water reuse system operating and maintenance capital improvement in debt service. Budget and allocation of costs. Thank you. Thank you. Thank you very much for being here. And I'm glad we can. We can start you in early. Yes, good evening, Mayor. Step Councilmembers on Nick Harvey, deputy director of administration. Center is the water we're here this evening to as we always ask your approval of the preliminary budget for the regional review system. Cip budgets. Reason we do that prior to budget adoption is we treat water for ourselves and for partner agencies and we like to get the final allocations out to agencies by MAY. One, chair say could go through their respective budget process. Ease. So we'll do a quick overview of the proposed budget will look at the allocations of that budget to ourselves and our partner agencies will touch on some cip project highlights for the year and then talk about the remaining budget schedule. So each year we like to show the percentage of flows coming into the plant. This is important because it's these flow percentages that determine the allocation operations and maintenance costs to each of the partner agencies. Santa Rosa typically anywhere between 70 and 75% for several years. Now. Moving on to our operations were
anticipating are budgeting for a 3% increase. Large part of that has to do with as you see there, the operations and maintenance projects they're down. 32.9%. That went a long way to hedge other increases, including need 4% salary increases for next year. And that's because those projects carry over budget and they had sufficient budget. We think they can. They can go next year without contributing more to the In general summary of some increases in production salaries and benefits. As I said, 4% citywide or at least enterprise wide. $536,000 increase, professional services are going up about $700,000 having to do replacement consumable components of the treatment processes as well as increased costs for bio solid land application and commercial disposals list. Tech. Utilities. The plant is, I believe still the largest consumer of electricity in Sonoma County. It's anticipated increase another $800,000. Both due to problems with their chp engines, which when they're running at full capacity, help offset electricity consumption, those are down. We've been having some maintenance issues are anticipating a little bump with that. Plus, we're all so. Anticipating electricity consumption going up because we're in addition to operating our existing uv system where also testing the new uv system before it's brought online. Vehicle replacement maintenance is going up 258,000 for the year based increased. Contributions for vehicles that are going to be
needed. And again, we able to reduce or request operations maintenance projects by 1.6 million due to carry over budget. It's a visual representation of our costs at the treatment plant salaries and benefits, debt service and cip continue to be our 3 largest categories. Cash funded cip. We have an agreement, the partner agencies increase 1 million dollars per year. So this year it's 13 million dollars. And we always like to show the miscellaneous revenue up top because the revenue that we collect in the enterprise directly offsets the amount that needed that need to be contributed by the regional partners. Summer around the city here. A lot about undesignated fund balance or reserves. The regional fund has what we call a refund reserve because if we didn't hold these mountain reserve, they'd otherwise be refundable to ourselves. Our partner agencies, we had 7 and a half million dollars about last year. That balance bring the total up to 16.2 million. We are expecting that to go down. 6 or 7 million dollars this year due to an item we brought before council for increased appropriations a few weeks back. Here's a look at our budget revenue is the 2 major highlights here. Our the increase in interest on pooled investments and the tipping fees are truck waste program has been wildly successful. So we're able to increase budget airlie to 4.7 up from 3.8 million last year and we're increasing our anticipated interest by $400,000 naturally of hires or balances. You're going to see higher interest yields in the funds. More cash
sitting on the balance sheet. This just quick calculation, how we get to our total agency contributions. We start with our operating expenditure requests. 54.6 million add the cash funded cip appropriations. A 13 million, another million to keep our operating reserve at 15% of budgeted operations. And that comes out to 68.6 million. We net out the 8.4 million dollars in revenue is and we get to net agency contributions of 60.2 million dollars for our cip and operations and cash funded cip rather. So There's a type o so should be. 26 27. But these are 26 27 allocations. You can see in the aggregate were were increasing partner contributions by just under one percent. Our increases were largely hedge by the fact that we didn't have a operations maintenance budget request as well as the increase in revenues for helping offset that ask. Our cip for the enterprise. We're investing 10 and a half million dollars in plant infrastructure. $975,000 in reason for structure and one and a half million for all planning and miscellaneous efforts. So here's a couple project highlights. This one is too rehab to secondary. Clara fires numbers one through 3 project asked me to a 0.9 million dollars currently in design. And we expect that to construct next year. Laguna treatment plant flood protection. This is this project's been a long way
coming ever since 2017. We've been working with fema and their Hazard Mitigation Grant program to get funding for this project. And we're finally getting down to where we're going to be ready to construct hopefully next year to estimated cost to 21.2 million dollars. And the Geysers pump station electrical upgrades. So this is the infrastructure that gets the water up to the geysers project that was previously mentioned by Mayor Stapp going up and looking at the pump stations, electrical supply and making sure that we have solid infrastructure so we can continue meeting contract water demands to the geysers project and avoid incurring large regulatory costs for discharging. And as you know, study Sessions MAY 5th and 6 and adopting on JUNE 16th. And with that center is the water. The Board of Public Utilities in the Sub-regional Technical Advisory committee recommended the council by resolution prove preliminary fiscal year 20's 2026 27 regional water reuse system operating and maintenance, capital improvement and debt service. Budget allocation of costs. For the purpose of notifying the regional water reuse. These are agencies and their allocation of such costs by MAY one 2026. Quite a mouthful. And happy to answer any questions. If you have them. Deputy director, thank you so much. Are looking to my colleagues are questions >> MADAM Water, please. I have a great question. >> And so I phoned money. Your slides that the Laguna treatment plant was in the best district that we have here in the city of Santa Rosa. Can you tell me what district that is? We've got the 7 that would be 7 innings. The council member for that
district. That Councilmember Rogers that would be Councilmember Rogers. I just wanted to point that out. And thank you very This pertain to the topic. It does. It's on the slide. I'm just pointing it out. I think that they're doing a great job. >> All right. We reach that portion of our meeting this week, MR. Alvarez. Thank you, mayor. Just want to point out that humility is an all-time. >> Do we have any substantive questions from council? That's your weekend. Grandstand. A little bit. Can't wait. Let's warm up. So, Nick, what I was at the geysers last week, I they walk me through something I never considered. But your mention of the Laguna Treatment Plant and line Road when we have at our at our treatment plants. If something malfunctions, even for a minute. If ultra violent, violent, but that's the technical term that filter scanner disinfection system, disinfection system. That was the phrase I was looking for. If that goes down, if for whatever reason our particular screens don't work, even for a brief window of time 5 seconds. I didn't realize never occurred to me put the geysers they have to spring into action in communication with our teams to prepare for about water arriving on site. There are a day or 2 later and then they have to have special plans to route that block of water into different into different systems. This is what you have learned if you had to endure. Got on Friday. So will change that all of us should go. But I thought I find it fascinating. So here's my question. Pertains to the to the subject we're actually discussing. As we're doing
these upgrades. Is that going to I've fewer and fewer. I interruptions to service or fewer fewer times that the guys are gonna is gonna have to that. We in the guys are going to jump into action to prevent that kind of situation or to mitigate the kind of situation. Are you saying is a project cause more system, downtime? No, going to prevent system, downtime prevent water that hasn't been Trop, operate retreated from making its way to the geysers and keeping them are having to take to mitigate that situation. I'm not an account, unfortunately, but just take a gas to goodness. I think it will help that. I think it will help, but also we've we've >> undergone some projects at the treatment plant where we have a significant aversion capability. So if water is coming through, it doesn't meet spec. We can pump it back up to retention pond and get it back to the head works for re treatment so that we're making sure we're staying complaints there and PDs permit. Interesting. That's that's a retention pond on site. There's a retention pond somewhere in between the treatment plan and the geysers. >> It's I believe Delta Pond. It's it's out. Northwest of the treatment plan out on Exhibit b, exactly. Remember where? Yeah. So my my colleagues are probably gonna be disappointed. My answers there. But, you know, this is I put it you very much. On the same. >> All right. Our I will lie. I not not not bother you any further, but thank you for that. Thank you for a good presentation. Any of the questions from council? >> Seeing none. We'll open up
to the public. Members of the public like dude like to comment on on this item. Seeing none bringing back 2 council for any for a motion and any final discussion and MR. Rogers is go to you again. >> Yes. Please kick us off. Thank you, Mayor. Just want to thank you again for coming here thank the water Department for doing jobs that a lot of us don't know. That you guys do in make sure that we have clean water that we can use. And with that, i would like to adopt the resolution as presented second. >> Emotional, get that second to MISTER Alvarez. And MADAM City Clerk, you can call a vote whenever you're ready. Thank you, Mayor Councilmember Rogers, I council members, MacDonald's funding and Ben are absent Councilmember Alvarez. I Vice Mayor Okrepkie. I mayor stab yes. The motion passes with form for affirmative votes. >> Thank you very much. And we have moved from being behind schedule to be about 10 minutes ahead of schedule. So before we move on to our next item, we're going to take a 10 minute break reconvene at 5. And for those of you who are here for the we discussion, we're going to continue that item to a future meeting. So if you're here for that for that, we have for them. We map discussion that will not take place today. That will take place in future. See everyone about 9 minutes. Welcome back, everyone. The time is precisely 5 o'clock. And we will reconvene open session. MADAM City Clerk. >> Thank you. Mayor Councilmember Rogers says it. Councilmembers MacDonald's Plumbing and then Wheels are absent. Councilmember Alvarez,
PRESIDENT Vice Mayor Okrepkie here. Mayor, stop here. All camp Councilmembers are present with the exception of councilmember has been well swimming and MacDonald. >> Thank you. All right. We'll go to our first public comment on non agenda matters. Item 14 public comment on Jen on matters not listed on the agenda. Fred. Go ahead. >> Good afternoon. I hadn't intended to speak in a public comment today, but I saw in the water presentation that there was a 4% cost of living adjustment for the salaries for water department. And so that caused me to think of that. That for the definition of disadvantage, community is 80% of state median household income Santa Rosa median household income is is a number of $1000 higher then state median household income so that people who live in Santa Rosa don't get a cost of living adjustment for their cost. Extra cost burden of living in Santa Rosa where that median household income is higher. So that that that the city defined disadvantage communities with the cost of living adjustment for the Santa Rosa median household income, that would tip a number of block groups from being not disadvantage communities to being disadvantaged communities. If you to find the block group with the cost of living adjustment. So it occurred to me that it would be fair that that have city staff can get a cost of living adjustment. Then the public who bearing a higher cost burden would get a cost of living adjustment and how the city defines
disadvantaged communities. >> Thank you as always, Fred. Any other members of the public wish to comment on items not listed on the agenda? Seeing none. We'll close public comment and go on to item 16.2 and again, item 16.1 that public hearing is being continued to a future date. But item 16 point to our public hearing on a sub middle of the fiscal year 2026 2027 action plan to the U.S. Department of Housing and Urban Development. Kelly, welcome. >> Thank you. Mayor Stapp vice mayor Crappie members of the council, Kelly, Kuykendall housing and community services manager. And I'll be presenting or seeking your approval to submit the fiscal year 26, 27 action plan to the U.S. Department of Housing and Urban Development. The annual action plan is essentially our annual action new application to hide so that the city can receive community development block Grant, Cdbg and Home Investment Partnership Act or home grants. The action plan is due to hide by MAY. 15th. The fiscal year 26, 27 action plan is year 3 of our 3 year Consolidated plan which identifies housing and community development needs priorities, goals and strategies. The consolidated plan serves as a guide for the annual action plan. The priority goals identified in the action plan include increasing the supply of affordable rental housing for the city's lowest income households. Preserving existing affordable housing stock and providing housing and services to special needs
populations. Our funding strategy for the year is 85% of cdbg funds for Affordable Housing administration. 15% for public services all touch on public services in the next cup slides for home. 75 1% for tenant base rental assistance and 15% for chose which are community housing development organizations and 10% for administration. These are our annual funding allocations for fiscal year 26. 27 first cdbg. Approximately 1.3 million dollars home 680,000 for a total of approximately 2 million dollars. The program in Com column noted in the slide as a result of loan repayments that we then reuse or recycle for these programs. The public services program annually. We put out a notice of funding availability and no phone for funding available through the public service program. As I noticed noted, a couple slides back approximately 15% of our cdbg funds go for public services. That's roughly $200,000 per year. We held a virtual public meeting on FEBRUARY 11th and received for applications. 2 from Catholic Charities for the car. You Toss Family Center and drop-in center. One firm fair housing advocates of Northern California for federally mandated for housing program. And lastly, one from the living room and that program serves women and their children. We will be returning to council on JUNE second with funding recommendations following some middle of the action plan to hide. Requires the city to have a citizen participation plan which out winds our outreach and engagement efforts related to
the action plan. So this slide outlines all the out all the efforts that we took as part of this year's annual action plan process. I mentioned the public meeting we held on FEBRUARY, 11th related to the public services funding. We also sent out information related to the action plan to targeted email groups. Post posted about the action plan on social and traditional media outlets. The city's website and see connections letter newsletter. The action plan was also made available for the 30 day public comment period, MARCH 20th APRIL 20th and the public comment period. I would say our outreach culminates this evening with the public hearing. Public comments received during the comment period or as part of this public hearing will be incorporated into the action plan prior to some middle to And you can disregard this last bullet on the slide. The final award allocations were covered in the presentation tonight and will be included in the final action plan. With that. The housing commute Services Department recommends the council by resolution authorized middle of the fiscal year 2026. 2027 action plan. The U.S. Department of Housing and Urban Development and authorize the city manager to execute any forms or documents required by hud employment implement the fiscal year 26, 27 action plan. This concludes my presentation. I'd be happy to answer any questions that you have. Thank you. Wonderfully says Saint Kelly, thank you so Bring it back to the council for questions. >> I will. I will ask There's
been so so much percolating are so much discussion percolating funding at the federal level. >> We know everything is uncertain. All right. Do we have some sense of of what the atmosphere is atmosphere there is like right now and potentially will be next year, especially around the funding that we're discussing. Ic ic Megan. Making your way to the front. If this is not if this, if this question is to broader words, it's just too We don't need to dive into it. But this is to been such big topic of conversation recent months. Thank you for your question. Mayor stop. I'm Megan passenger, director of housing and Community services. >> I'd say through our federal lobbyist Mmo partners, we remain in contact representatives from our area for this particular years. Allocations were seeing a 2% reduction funding, which is consistent with with previous years. I think right now the PRESIDENT Has put forward a proposed budget. But again, that needs Congress and Senate to approve. So we're just taking this month by month as various iterations. The budget move forward but relatively stable at this point in time. >> Okay. Thank you for that. And it's 2% on top of the fact that there wouldn't be any kind of inflation adjustment. So the real real world purchasing power is already declining. And 3 plus percent a year plus and a 2% caught top of that. >> That is correct. And that becomes more compounded as we look at other programs that housing and community services operate such as the voucher program where we're looking at flat flat budgets, but
increasing costs. >> ok, thank you very much. Looking back to council for any any follow-up questions. There. All right. Thank thank you both. Thank you for all the work in this area. We'll throw this open to public actually, no, we're going get anything more officially. All right. I'm not gonna open the public hearing. Are there any members of the public that would like participate a comment on this item? Now is your chance. Please go ahead. >> regret not being here more often. I'm back. And toy. Yeah, yeah. I mean, yes. With homeless action action from Ation Point. This Approves funding for housing. And I was wondering. If there was any allowance, 4. For residents. For residents with very income or, you know, I was wondering if they were considered at all. And this plaid. Thank you for having me here. Victoria, thank you very much. Welcome back. And just to be clear I'll look to to make it into Cali. But they they had funding we're talking about would cover essentially all income all income levels. Anybody who needs housing assistance potentially. Is that correct? >> That is correct. In these particular programs. Do fund individuals with generally 0, 2, 60% of am I so. >> All right. Thank you. Thank you for that clarification. Are there any other members of the public that would like to make comment? Seeing none. We will close the public hearing and we will bring I will bring it back to the days for a See the disco to MR. Vice Mayor Okrepkie to have a motion for us. Yes, I move to adopt. The resolution is presented by staff. A motion a second by MISTER Alvarez. Any additional
conversation, MR. Rogers. >> Not conversation. I just wanted to thank you and your team. I know that it's really hard to do more with less than I know you know, the budget probably wasn't ideal in the first place of the amount of money that you guys have to work with. But you're doing a great job and you MAY not be able to reach as many people as you want to reach when we see the numbers. But for the people that you can reach in the family's, the couple's the children, you're making a big difference in their lives. So I just wanted to to let you know that we see you and we see the great work that you're doing him. Please don't don't get discouraged. >> Thank you, MR. Rogers, any additional discussion? Now? We have a motion and a second. MADAM City clerk, you can call the vote whenever you're ready. >> Thank you. Mayor Councilmember Rogers. Council members, MacDonald Plumbing in Ben Willows absent councilmember Alvarez, Vice Mayor Okrepkie. I mayor stab yes. The motion passes with 4 affirmative votes. >> Thank Move on to item 18. Our are second public comment on non agenda matters and here is the public wish to comment on any items, not on the agenda. Seeing none. We will close that second public comment and I should have thanked Megan Kelly, thank you again for taking the time represent. And with that. All right, Victoria, we're gonna we're gonna open up again just for you. Take you have 3 minutes. >> Thank you very much. Am a resident of Bethlehem Tower. It is a dry day as side of the park over here, catty corner from parking lot. So it's a pleasure to be able to walk over here. The with you. Now
As a resident of Bethlehem power, I'm able to enjoy. The neighborhood because we have houses and yards and gardens. >> And >> one very important service that we had was a Sam's market there on the corner of the Tupper Street. So while they used to have a dally, but they don't anymore, not even coffee. Everything is dedicated to hard liquor now. Which I didn't mind, I don't buy my you're there. I'd buy it at grocery outlet. If I even have a beer. But anyway, had some suffering racism or I don't know what kind of it is that the owners who they are, we're treating their customers very badly. Very rude. I think it might have gotten some new people in there since then. I don't shop there. Because the prices are. Crazy. So I do like to walk there, you know, with somebody who wants to go to the stores up it's right. It's a part of our neighborhood. The only thing that really gets to me in the region lie found Interesting to the city Council. It's they got the guy. They got rid of the garbage can right by the front door. So as much as they profit off Their sales, too. Local community. We have to go around picking up papers and take it to our own garbage if
they don't have a garbage can anymore. And I want talk to the people the permits. Somewhere with city, we could put pressure on them to put actor garbage Thank you. Thank you. And Victoria on and we will again close public comment and we're officially adjourned. Thank you, everyone.