having arrived. I will call to order the Finance Committee meeting of Monday July
27th, 2026 and ask Director Schmedicke to please call the roll.
Council President Madison.
Here.
All the revere here.
All the river.
Here.
All the rivers.
All the gantella.
Here.
All the O'Brien.
Here.
Thank you.
Thank you.
And I assume that all the average dog is making noise and thus he's not unmuting.
Thank you all there.
Our first item is general public comment.
We have a number of people registered for general public comment.
I, however, do not see them on the zoom.
So I just ask our tech facilitator to confirm that.
I do not see anyone except for Mary in the attendees there.
To his city staff.
So it's the will of the body, but.
Might be appropriate to have a motion to table item one, which is general public comment.
To the end of our agenda to see if folks do show up.
Motion to table the public comment until the end of the agenda to give folks time to join.
Moved and seconded to place on the table. Is there any objection to placing this item on the table?
Seeing none.
That is on the table.
Then are there any disclosures or recousels on items on tonight's agenda?
Seeing none.
And we'll move on to the consent agenda.
In addition to item one, which is now on the table.
And we have, I believe, presentations on items 16 and 18.
So those will be separated. Are there any other items that members of the body would like to see separated from the consent agenda at this time?
All the revere.
Thank you, Mayor. We could please separate agenda items three.
And 13.
And I both.
And I was going to suggest agenda item nine, because the fiscal note was inaccurate.
But we just noticed it looks like it's been corrected.
Since I reviewed the agenda earlier today.
Thank you. All there will separate items three and 13.
Thank you.
President Madison.
Not on this, but I did get a message from someone who said they registered to speak, but did not get a link, an email link.
And can we have our tech facilitator just check on that, please? Yes.
Thank you.
All right. Are there any other items that members of the body would like to see excluded from the consent agenda? Alderman.
I just very briefly items two and four allow our continuing staff to just say hello.
Thank you. All right.
Are there any other items that members of the body.
Would like to see separated from the consent agenda at this time.
Seeing none, then we will be separating items one, two, three, four.
13, 16 and 18.
If I could get a motion, please, on the balance of the agenda, which will stand consent.
Move to adopt.
Sorry, second.
Seconded to adopt the balance of the agenda and the recommendations therein.
Is there any objection to recording unanimous vote in favor.
Seeing no objection, record that vote and move on.
So.
Our first item, then, is item two, which is register 94051.
I'm pleased to submit to you the appointment of David Schmiticki for a confirmation of an additional five year term as finance director.
And if I can get a motion in a second, we could ask the director to say a few words if you'd like.
Most until it's sent or that.
Moved and seconded to confirm.
Director Schmiticki.
Thank you, Mayor. Thank you, members of the finance committee.
I'm honored to have been asked by the mayor to continue serving as finance director.
And I look forward to continue work on a lot of the efforts that we have around.
We have a lot of transparency in the budgets, our efforts around bringing data into the process for decision making and continuing to serve both the mayor and the council in the stewardship of the city's financial resources.
So, again, I feel very honored and thank you again for this opportunity to serve.
Are there any questions for director Schmiticki.
I would just like to appreciate the fact that director Schmiticki is willing to continue serving.
I'm sure the rest of you feel the same way.
And so without further ado, it's moved and seconded to recommend confirmation to the full council.
Is there any objection to recording a unanimous vote in favor.
Seeing no objection will record an enthusiastic unanimous vote in favor of confirmation.
And it moved to item three, which is led to star 94053 submitting the appointment of Christine nap.
And Christine is here with us. I'm delighted to introduce you to her and recommend her confirmation as for a five year term of the water as the water utility general manager.
And if I can get a motion recommending confirmation.
Motion to accept.
Moved and seconded to recommend confirmation. Christine, welcome. Thank you for joining us. If you'd like to introduce yourself to the body and just say a few words.
Thank you, mayor. Thank you for having me members of the finance committee. I am Christine now and I look forward very much to getting to know all of you and learning the ins and outs of the water utility and making sure that my country.
So that my contribution to the fiscal responsibility is on on par with what you're all expecting. So I could go on, but I will leave that to the to the future. But thank you for having me very much.
Thank you for being here. Are there any questions for Christine?
Seeing none. Oh, all the bit of her. Just, I mean, if you just want to like a very brief.
Like summary of like what brings you here today? Like what's your background and.
Why, why Madison? Sure. So I'm currently for the next couple of weeks, the water.
Plant manager for the city of Cedar Rapids in Iowa. And I oversee the operations and regulatory matters for our two treatment plants in the city. And why not Madison? I've visited there and I've loved it every single time.
I think it was about three years ago. I said, I would love to retire here and I actually am possibly going to see that happen. So I look forward to that. So, yeah, thank you.
Thank you. All there. Any other questions?
If not, that's been moved and seconded to Aldo Rivera. Go ahead.
Yes. Thank you, Mayor. And I separated this item first and foremost so that we could meet Christine. So very warm. Welcome from me, Christine. I really look forward to working with you.
Thank you for coming to Madison and for being with us today. I did have a question. However, Mayor, not for.
Warning, utility general manager nominee, but rather perhaps for HR, Director Hillson or for you. And that is when I read the contract that's before the employment agreement.
It looks like perhaps there might be a inconsistency in the provision that's entitled general responsibility and then further down personnel actions as it relates to.
Direct reporting and and how the general manager who the general manager would serve it and report to. So just wondering if you could clarify, obviously, this is a whole new world for us with the next agenda item of our exciting.
New public works director and how that all fits in, but to be more specific in general responsibility, it says this position reports to the water board and the mayor.
And works as a member of the public works team, but then further down under personnel actions, it says a general manager serves at the pleasure of the mayor and the director of public works.
So just looking for a clarification and wonder if we need any minor amendment to the draft agreement.
Director Hillson.
Not yet you're still muted on our end.
I can try and unmute you.
There you go. You should be unmuted.
Yes.
Okay, thank you so much.
Yes, this is a little bit of a new world for us, but not entirely. We are really excited about.
Charlie's transition to the public works director.
And so there will be a simultaneous.
Reporting requirement between.
Christine and the mayor and the public works director.
Obviously, it requires that the two of them be on board with.
Directions that she receives that they're on board with any sort of disciplinary action, any sort of.
Employment action that they may receive, but I think the call out to the.
Board is really sort of the reporting requirement to the board, but I can take a look at that after today's meeting and see if maybe that needs to be tweaked or modified so that.
It doesn't seem confusing.
Yeah, thank you very much, Aaron. Yeah, just to clarify the water board part. I totally get. I'm sure that's our past practice all the years I've been here for this position. My question was just with Charlie now as our director of public works.
And my understanding of his new role is that that those divisions in this department in the public works team would directly report to him and perhaps continue to direct direct report to the mayor as well.
So I was just wondering if we needed to add director of public works and that general responsibility section that the position reports to the board, the water board, the mayor and the director of.
Public works to make it consistent with the section later on about again, personnel actions.
Yeah, I think that definitely has clarity so I can get that taken care of before.
It comes back to come.
Thank you so much. You're and appreciate it. Thank you, ma'am.
Thank you. Welcome again, Christine.
Thank you. Thank you. Thank you. Director Hillson.
Is there any other questions or discussion?
Seeing none. The it has been moved and seconded to recommend confirmation. Is there any objection to recording unanimous vote in favor?
Seeing no objection recording unanimous vote in favor of recommending confirmation to the full council. Thank you for being here, Christine, and we'll see you at the council meeting.
All right, that will bring us to item four, which is led to star 93925 submitting the appointment of Charles J.
Romines for a confirmation of a five year term as director of public works. I'm delighted to.
Submit this recommendation to you. And if I can get a motion, please.
To recommend confirmation.
Motion to recommend motion to accept motion to adopt motion to.
Motion to recommend here and seconded.
Thank you.
I know that.
Charlie is traveling at the moment and can't be here.
And so perhaps we can forego any questions or congratulations until the council meeting.
But it's been moved and seconded. Is there any objection to recording a unanimous vote in favor to recommend confirmation to the full council.
Seeing no objection will.
Record that vote.
And then that will take us to.
Item 13, which is led to star 93941 approving a revised rate for the 2026 resource recovery special charge and amending the 2026 streets division operating budget on item 13. Can I get a motion, please.
Motion to adapt.
Moved and seconded to adopt item 13.
All the revere. I believe you had questions and Roger Kleist is here.
Yes, thanks again, mayor and welcome Roger. I think this is your first time before this.
Committee, at least in your newly well-deserved promoted role. So welcome and thank you for being here. Yeah, I obviously read the resolution and I just said a couple of curiosity questions.
The first one was it was wondering and I presume you know the answer to these questions. But anyway, I was wondering about the $125,000 in lost revenue projected from Pelletary in our contract with them.
And I was wondering if you could be more specific as to which recycle commodity is the one that's that's decreased in market value currently and that sort of thing.
If you could explain the loss revenue from Pelletary is a little more.
That's the cover. We had a surplus in revenue in the past.
And that's to cover up the last five months of the year that we won't have that surplus anymore.
So we'll have to cover the additional tipping fees of the lost revenue and just what the material is that extra money we had in the fund and then salaries that weren't covered by that.
So it's not that the commodity markets have decreased for like single stream recycling. It's just on what are what we had from last year.
It's a combination over the last year of the commodities tanking and then losing that little extra revenue we had as a cushion and then just to add a cost.
Thank you. And then obviously the biggest part of this increase according to the resolution is increase in diesel fuel costs, which are pretty understandable.
The other part I just wanted to ask about is the salary savings and ability to meet our target for salary savings. Could you discuss that a little more?
Did we simply not have any turnover in the positions that are responsible for resource recovery here?
Sorry, could you repeat that? I just Charlie was trying to call me while you were asking the question.
I hope he's not trying to tune in because you're doing a fine job answering these questions. I hope he's not trying to jump in.
Anyway, sorry, Roger.
What I was saying is obviously the biggest piece of this is the increase diesel costs, which are pretty self explanatory.
The other part was $170,000 projected deficit due to our salary savings and the inability to reach your salary savings target for these positions.
So I was hoping that you could explain that elaborate on that a little further. Is it simply that you've had hardly any turnover? You've done so well in retaining the employees that are covered by the special charge or or what exactly do you attribute that to?
So it's the salary savings is hard to do with our C because we only bill actuals to it. So unless we were to reduce services, we can't actually see a salary savings on that because we only bill actuals and we didn't cut any services with the recycling collection.
So we're actually taking that out of the next this next budget process to have a salary savings on recycling or at least try to reduce it because we only bill for actuals.
We do have a surplus in salary savings on the general fund. We're probably about $300,000 over the target that we're at now that we're trying to fill open positions. So we have salary savings somewhere else just can't make salary savings without reducing services on the recycling side.
Thank you. Thanks again, Roger. I see there recycling guru Brian is enjoying just an engaged his camera. Brian, did you wish to add anything, especially about my question about our military's contract in the single string recycling commodities market or anything?
The commodities thing really is sort of across the board. I mean, most of what we recycle is paper products. So you think cardboard paper stuff and demand has been soft and low for that for a while. And then.
And so that's been a big part of it over half of what goes in the cart is that. So if that value is very low, that hurts that material to plus just as it tends to be where oil prices tend to be high plastic prices tend to track with that.
But most of what by weight in our recycling cart, not a lot of that's actually plastic by weight. And that's how you do recycling is all by weight.
And plastic is just cheap to manufacture to a lot of people that even use that are choosing to use like virgin plastic materials as opposed to recycle materials.
So that's part of that too, but really a lot of us that paper value as paper is worth more that helps us when paper is worth less that doesn't help us.
So, and as shipping changes and as our buying behavior changes as the economy shifts around to that's kind of where the cardboard stuff comes in and where all that paper products really.
That's a big driver of it.
Thank you.
Thanks for explaining that.
Thank you.
Thank you.
Are there any other questions for staff on item 13?
Seeing none, then item 13 has been moved and seconded. Is there any discussion?
Seeing no discussion. Is there any objection to recording unanimous vote in favor of item 13?
Seeing no objection will record unanimous vote in favor of item 13. Thank you, Roger and Brian for being here to answer questions.
And that will take us to item 16.
Item 16 is register 93981 authorizing the issuance and establishing the parameters for the sale of not to exceed.
A lot of money in general obligation, promissory notes of the city of Madison, Wisconsin, and directing the final approval of the terms thereof.
On item 16, can I get a motion, please?
Motion to go back.
Okay.
Moved and seconded to adopt. I believe staff have a presentation on this.
Yes, thank you, Mayor.
Well, we're getting that presentation set up. I'll just note for any of the public who may be watching and wanted to comment on item one.
We did place item one on the table and we will return to it and and allow anybody who is in the meeting at that time to make their public comment on item one.
That will be, we have this item that's before us right now and one additional item before we come back to item one.
Go ahead, Dave.
Thank you, Mayor.
So the agenda item before you is the 2026 geo general obligation borrowing and I'll give you an overview of that as well as just a quick summary of the resolution that's before you today.
So just a quick background on what is what we call geo borrowing or general obligation borrowing.
It's either tax exempt under federal law or taxable borrowing for 10 or 20 years.
And we sell that debt to finance projects, which are included in the 2026 adopted capital budget.
And launching a state law change a couple of years ago allows us now to do 20 year promissory notes,
which prior to that time, we can only do 10 years. So that's definitely a benefit.
The capital budget includes both new projects as well as projects that were adopted in prior budgets and carried forward.
By general obligation, this means this is a debt of the city and the city is pledging its full faith and credit.
Through authorizing hero irrevocable property tax levy to repay that debt, including interest.
The first property tax levy for to repay this debt will be the 2026 levy in December of this year, which will be due in 2027.
And we do have other city revenues that pay this besides property taxes, for example, stormwater user fees and things like that.
We're issuing about 45% of the authorized debt.
And a lot of that is due to the timing of projects, cash flow needs for those individual projects,
as well as requirements under federal tax law regarding arbitrage, meaning how much debt we can carry for how long until we actually spend it.
We're borrowing $142 million of what we call new money.
And these are the amounts by agency. The largest is funded from tax increment districts for a variety of different things, both the infrastructure as well as developer loans.
Engineering major streets is the next largest most prize there.
And that fleet services being vehicle acquisitions.
Fire has a significant part of this because of the borrowing for the new fire station six.
That's a part of the park badger development.
And then you can see the remaining by agency.
This borrowing is for about 400 projects or programs.
About 20 of those 400 are over one and a half million dollars and represent $76 million of that $142 million. So.
As I said, the fire station six, as well as the South Madison public clinic.
Public health clinic, which are both a part of that park badger development.
Are the two largest single projects.
As well as the recent property acquisition at Royster Commons that was approved by the council fleet vehicles, affordable housing and so on.
This is a history of general obligation borrowing over the last roughly 10 years.
You can see it does fluctuate at times and.
We are on an upward trend with a number of very large building projects in particular.
As I mentioned for for this year as well as upcoming projects.
This is the long term interest rates on the city's debt since 1988.
And you can see how we remain in a historically, you know.
Relatively low interest rate environment, but obviously higher than what we saw post the great recession.
And fuel that I think by what's happening.
Both in high inflation in the economy over the last few years.
And recent geopolitical events.
So we are seeing some increase in interest rates and we do expect interest rates for 2026 to be slightly higher.
And what the city received in 2025.
So turning to the resolution that's before you.
Beginning about three years ago, we moved to what's called the parameters resolution, meaning we set up the boundaries for which under which we could issue the debt.
And that allowed us flexibility in the date upon which to issue that debt.
And get the most favorable conditions from an interest rate perspective.
So it does allow the finance director to carry out the intent is expressed by the kind of council.
And those have to fall within the parameters in the resolution. Many government entities use this approach.
And what the parameters will be the maximum power amount. So the borrowing there, the maximum true interest costs.
That's how we compare competitive bids and the maximum cost of issuance for the no proceeds.
So the maximum power amounts about $173 million. As you see in the title of the resolution.
About 85 million of that is 10 year borrowing tax exempt.
20 year borrowing is about 27 million. That's primarily for those large building projects that I mentioned.
And then we have about 32 million. That's taxable.
That includes primarily those types of borrowing, such as for developer loans under TID.
And affordable housing type of investments.
And things like that that are not eligible for tax exemption under federal tax law.
A 29 million of that 173 million is possible refunding of already issued debt.
And these are possible opportunities based on where the market is right now.
And we might refund 29 million. We might refund something less than that or zero, depending on the market conditions at the time of sale.
And if we have an economic savings, sorry, from that possible refunding.
And then our maximum true interest cost is 5% on the tax exempt.
And is 6% on the taxable.
And then our maximum cost of issuance is $390,000. That's for municipal advising services or bond council, as well as various actions we have to take for registered notes.
That parameters authority expires at the end of this calendar year. We do expect to sell debt on August 25.
Based on timing to date.
So, with that, I'll stop sharing. I'm happy to answer any questions.
Thank you, Director Schmedicke. Are there questions on item 16?
Alderman.
General question that tends to come up in conversations with.
Folks in the district and particularly since I have one of one of my district projects is on the list.
And it's that duality of that we both.
Take out loans to fund for street improvement projects and there's assessment. Can you just speak to a little bit about.
What the determining factors are about like.
What what goes to where, how much do we decide that is supposed to be for bonds versus how much is for assessments and.
Kind of how, how can community members get engaged to understand how this works.
So, I don't think they're here today. We probably need city engineering to speak to that because that the assessment policy determines.
You know, is it urban gutter.
The extent to the improvements. And so it's based on the engineering determination of what's happening in the roadway.
That determines how much of a project will be funded from special assessments, how much from city debt.
And depending on where the project is occurring, there could be other funding sources involved in the project,
such as federal aid.
State funding, county funding, other local funding for that project.
But there is a city assessment policy that determines how those costs.
Are allocated that was recently updated. And I believe came before the council, if I remember correctly. So, um,
individuals can see that policy and obviously.
You know, through the process, the legislative process that has changed in the future.
Thank you.
Thank you. All there, all the revere questions.
Thank you, Mayor. Thank you very much Dave for the presentation and moreover,
thank you for re upping for perhaps as much as another five years or more with us.
We really appreciate that in your leadership.
My question is when the results of the borrowing exercises here that you and your team engaged in.
That led them to the number that's before us in this resolution.
How does that.
How does that number compare to the adopted 2026 capital budget and the amount that we had anticipated.
We would need for for borrowing proceeds.
Last fall.
It's about 45% of the.
Authorized borrowing. So that's both the new borrowing that was authorized in the 2026 budget as well as amounts carry forward from prior capital budgets.
Thank you. And how does that compare historically? Would you say to.
That's roughly where we've been each year is around 45 to 50%.
For the reasons I mentioned in the presentation, which include.
Just timing of projects. These are multi year.
Projects we don't want to borrow too soon for projects because of federal tax law arbitrage requirements.
And things like that. So the project could be delayed for a number of different reasons.
And that's why we have to continue to carry over that authorization from one year to the next.
Thank you very much.
Thank you mayor. Thank you all there.
Are there any other questions for staff on item 16.
Seeing none. It's been moved and seconded. Is there any discussion.
Seeing no discussion then is there any objection to recording unanimous vote in favor of item 16.
Seeing no objection will record that unanimous vote and that will take us to item 18.
Item 18 is register 94055.
Which is the mid year appropriation resolution amending the 2026 adopted operating budget.
By taking a number of different actions.
And amending.
Yes, taking a number of different actions which we are about to have a presentation on.
So I will not read the whole thing. But first on item 18. Can I get a motion please.
Okay.
Okay.
Okay.
Okay.
Okay.
Okay.
Okay.
Motion to add.
Second moved and seconded to adopt item 18.
And I believe this one will be budget director Christine co.
Hey everyone. Good afternoon.
As the mayor mentioned this item has a lot going on in it. So.
The presentation.
This evening will provide a high level of review of our projection process.
At the end of the presentation will also have.
Metro general manager Jamie act and provide some more context on.
The projection for Metro specifically. So I'll go through my slides.
Transition to Jamie and we can decide if we want to step for questions before or wait for the whole presentation to be complete.
So there are two main components to the slides.
The first is explaining how we create the major projections and that a review of what is in the resolution itself.
One important thing to note is that the budget projection is based on a point in time analysis of projecting spending through the end of the year.
So on June 1st we pulled data or all of the actual expenditures through May 31st.
And prepare data for the projection process. It takes us about a week to prepare all of this data.
We send it to agencies.
And then there's about a two week period where our budget analyst team and agency analysts are independently completing their projections to estimate how they're going to end the year.
And then after this two week process, the budget analyst meets with every single agency in the city to discuss their assumptions and finalize projections.
That takes about two, two weeks plus or minus depending on availability.
And then it takes us as a team about an additional two weeks to compile the city wide resolution.
So I put all this out because there is a bit of a lag in what the data represents.
What's not included.
And it really is based on a point in time for the first five months and it's given staff capacity.
How long it takes to do the detailed analysis coordinating with agencies. It just does take almost a full two months to produce this resolution.
So please keep that in mind as you see any of the numbers.
This table provides a high level summary of the projection for the general fund.
In the columns, we have the budget at different phases. So we have the 26 adopted budget.
The revised budget, which reflects any transfers or legislative files that have been approved to date.
Our estimation for the major projection based on this collaborative process with agencies.
And then the difference, which is the major projection minus the revised budget.
And then negative numbers typically indicate where we're either understanding in expenses or over over performing in revenues. And then.
For the rows, we have our general fund revenues, property taxes and our total general fund revenues for the first three rows.
And then the second section in the bottom, it reflects our expenses.
So I'll go to into this in more detail.
Subsequent slides, but for general fund revenues, we're projecting to over perform or have more revenues and budgeted due to a number of areas.
Where we anticipate, anticipate receiving more local revenue than the budget.
And this is primarily related to ambulance billing and.
And building.
Building revenues.
Our taxes, we budget at.
We project that budget.
So in total, our revenues are about $767,000 above where we projected.
In terms of agency expenses, our total agency expenses. So we, we present certain revenues are presented in the agency budgets and we look at the net of agency revenues and expenditures to do our projections.
And that's also how we build our budget. And when you take these numbers together.
In total agencies are projecting to underspend by about $4 million.
So this combination of over performing revenues, under spending in.
And expenses leads to a projected surplus of about $4.5 million.
And that's really just taking this total revenues number plus total expenses.
And the footnote is just a technical.
Know about how we factor in carry forward and conferences. I'm not going to get to that detail right the second.
So just looking at the high level summary for general fund expenses in total.
Expenses, net of agency revenues are projecting about $4 million below budget.
If we just look at it, something also to remember about the budget is that we have.
A budget for what we call direct appropriations, which is where we centrally budget for costs.
That are difficult to allocate specifically to agencies. So that includes things like our contingent reserve.
Payments for compounds since escrow, which is sick leave pay off retirees.
And some other miscellaneous benefits and costs that are really benefiting the whole of the city.
If we exclude direct appropriations, then only look at agency budgets.
Agencies are actually projecting to overspend by a little over a million dollars.
This overspend is driven by a few things.
The largest item being personnel cost being about 3 million over budget.
And when I speak about personnel, I mean, both salaries and benefits.
This 3 million dollars over budget is a combination of various, various factors. One is it includes.
The compounds that's escrow payments when they are made, they hit the agency budgets. And then at the year.
They show up as natural in the agency budget. We budget for indirect appropriations.
And in our year and resolution, we make a transfer from direct appropriations to the agency.
But until we know the full cost, we don't make this transfer. So it appears to be a deficit in the agency.
When we really do have another pocket of money to cover those expenses. So that's a portion of this 3 million dollars.
In addition, starting with the 2024 budget, we implemented what we call budget efficiency cuts that were 1% in.
24 and 25 and 0.75% in 2026.
We budget for this in this kind of overall budget reduction in personnel.
Because most people recognize that savings through salary savings and turnover.
However, agencies may actually achieve that savings by under spending and purchase services supplies or somewhere else.
So, personal cost being over budget is somewhat overstated.
Because they're achieving agencies may be achieving savings in non personal objects.
And they also might be showing the full confidence escrow costs that will be covered through a year and transfer.
So that's the personnel side.
For non personal items agency budgets as a whole are projecting to be about 2 million under budget and purchase services.
And this is mostly related to the timing of multi year software agreements and prepaid expenses. So there's a pretty significant under spend in.
For example, and a number of other agencies where agencies may have prepaid a full 3 year software contract in 2024 2025.
It was budgeted in 26, but they already paid for that. And that's related to changes in accounting practices for software.
So the agencies are projecting over budget by 1.06 million.
The area where we are seeing under spending is in direct appropriations. So for the purpose of projections.
We project concepts and escrow at 0 because the agents again, the actual costs are hitting in the agencies. So it's reflected in this top number.
We also typically project contingent reserve at 0.
This year there is a small actual and contingent reserve based on an earlier resolution to fund the continuation of the mad cap customer assistance program for the utilities through general fund money.
And that moved $70,000 from the general fund to various utilities.
So when you add these two numbers together, agency overspending.
Plus under spending and direct appropriations, we get to this $4 million of budget.
Of understanding across the general fund.
In terms of general fund revenues, I mentioned there are a number of areas where revenues are performing higher than budget.
One for context, the projection, the 26 budget included about $2.2 million in one balance applied to close the budget gap.
And by now the property tax levy, the projection actually assumes using $0 and one balance due to the strong performance and other revenues.
So we project on balance at zero and the areas that are making up for that are really an ambulance charges.
More we're getting 1.9 million above budget due to changes in Medicaid billings and and how we're collecting for those costs.
And then in building permits, which are projecting about 1.1 million above budget. A lot of this is related to construction related to the spring hailstorms.
In in higher mid year resolutions, we may have adjusted the interest numbers based on trends.
Right now the projection projects interest and have budget, which is about $15.2 million. So we have narrowed in on that number.
A little bit. So we're keeping it at budget for the purpose of this projection.
So going a little bit more in depth into agency projections, if you've been part of this committee before, you may have seen slides where I have, you know, 10 slides that.
Copying and pasting tables from an Excel file. It's.
That shows changes by agency. So.
This year, instead of, you know, copying and pasting is as images, I've attached that agency analysis as an Excel file.
To the legislature file to make it more accessible and easier to use.
So I'm just going to pull.
That up here.
And the way that this table is set up, it shows all of our general fund agencies.
Functional area is just how we group agencies in the budget. So all the admin agencies, you can, you know, if you, if you like to.
Play with data, create pivot tables, you can, you can group this on your own. So we have our admin is.
We have our different categories for functional areas. We have our agencies.
And then the columns are mostly the same as the table I presented on one of the first slides where we have the original budget revised budget.
And then the variance is the difference between our projection and revised budget.
In this presentation, any positive number is showing where an agency is going to be under budget and essentially generating a surplus and a negative numbers where an agency is going over a budget.
And then I have a number of comments related to the major drivers of these variances.
So I'm not.
I'm just going to hide some of these. I'm not going to go through every single item right now.
But just to illustrate.
Assessor is projected to be under budget by about $353,000.
That's really because they've had two vacancies for much of the year, those salaries and benefits, along with some other items make up the majority of.
Of this underspend.
They're expecting a slight overage in non personnel for costs like postage transcription and other costs.
So the resolution does include an intro department will transfer where they're taking some of their salary savings and applying it to these non personal items.
Again, areas where you see under spending a lot of this in the example of the attorney is related to being over budget and personnel. And this is a combination of.
The comp absence escrow, which is budgeted centrally and will transfer to agencies.
And there's also like a payroll allocation issue and the attorney's office were staff time wasn't being charged correctly to tids and capital projects.
So that's a technical issue that will be cleaned up before the end of the year.
So you can read through these comments. I'll highlight a few because areas where we have a big number.
The clerk's budget is projecting to be over budget by about $900,000.
About half of this is related to being over budget and personnel.
This is due to higher uses of our release and election officials to cover capacity due to vacation and turnover.
I think last year the budget was being developed when there was a lot of transition in the clerk's office.
So we didn't adequately budget for supplies and counting all of the elections scheduled this year.
And then related to purchase services.
The agency is projecting to be over budget because of a new lease for equipment for a facility to store election equipment related to construction of the dean county election center.
That project was known, but it wasn't the lease costs were not known.
There's a resolution on that item recently that was adopted by the council. So we need to fund fund to that.
It I mentioned has a surplus of about 1.1 million. This is the largest surplus of any of the general fund agencies.
And this is a combination of having a kind of above average number of vacancies for the first half of the year that IT is taking steps to fill.
And pretty significant being significantly under budget and purchase services related to the timing of software costs and prepaid expenses that were paid in 24 and 25.
And there was a change in in in GASB rules about how to account for these software costs.
We didn't fully have understand the impacts of this and future budget. So we carried forward more cost and IT than we needed to in 26.
So they are showing as being significantly under budget.
A few other items, please again at the time of the projection which use data through the end of May.
This is projecting to be over budget by about $750,000 and this could.
This is fully attributable to cop absence escrow costs.
There were a number of line items that were projecting over or under budget.
But this deficit amount is related to retiree payouts that would have been covered through the year and transfer.
And then one other item that's somewhat unusually large is the deficit and traffic engineering.
They were over budget and personnel due to comp absence escrow as well as not meeting the salary savings target.
The 2026 budget.
We increased their salary savings above the standard 3% average because the agency had been having consistent and persistent vacancy rates.
So we kind of made a one time adjustment to salary savings to increase that lower their personnel budget and use that money to reallocate with a non personal costs.
This year they've been able to step up and do not have the very high salary savings rates, which is resulting in an agency level deficit.
So I'm again not going to talk through every agency. I think I talked about everyone that is 500,000 or more.
And if people have any specific questions, I'm happy to go back to this during the question portion.
The resolution also, we do have a projection for every single agency, including the non general fund agencies.
So I've pulled a few highlights that are specific to action items included in the resolution itself. I'm not including every single non general fund.
The agency in the summary fleet services projecting to be $161,000 over budget and purchase services for vehicle repairs and maintenance.
They are a little bit under budget in personnel costs and can fund this over budget amount through an intro departmental transfer.
One area that we have been watching with fleet is their fuel costs. And while this while these costs are above budget, there's enough savings and other objects within the sale or within the supplies category that they're able to absorb higher fuel costs.
Golf, similar to the last several years is projecting higher activities and higher revenues than budgeted. So the resolution increases their overall budget from facility rentals and green fees by $245,000 offset by higher expenses.
Library is projecting to end the year about half a million dollar over budget. And this is related to a number of things primarily related to their personnel costs.
There was a large reclassification for positions that was adopted by the council a few months ago that included significant back pay. This wasn't fully built into their budget.
There's lower vacancy rates in prior years.
And while we did our best, they also have higher the budgeted absence escrow, which is paid through the library fund, not through the not through the general fund direct appropriations amount.
And there were also a number of costs related to the imagination center that weren't fully included in 2026 like collections processing fees.
And I think we did our best to estimate that cost, but as the project has moved forward, there have been some items that have, that have come up as needs in this year.
Metro is projecting a 4.2 million deficit. That's a combination of revenues being lower than budgeted and expenses being higher than budget. So it's, it's not just that they're overspending by this amount.
So it's a combination of factors. And as I mentioned, Jamie will provide a more in depth presentation on this item.
After I go through my slides.
And I'll kind of leave the details for that portion.
The streets, the streets agency includes multiple funds. So they are a majority of their budget is in the general fund, but they also have, but separate budgets for resource recovery urban forestry stormwater.
So as discussed with an earlier agenda item.
The RSC budget is projecting a deficit of about half a million dollars as a combination of revenues.
Higher diesel and personnel expenses. And earlier in this meeting, this committee took action on that item.
And all of the other enterprise funds are projecting to meet budget targets and not require any transfers at this time.
Okay, so that was a lot of information. What exactly does the mid your resolution do?
Six main components. Some of these are very technical in nature and are things that we do every year to transfer money from a central pot to an agency.
Some of them are, are larger issues. So I'll run through each of these six components.
The first is transferring funds.
From for carry for the conferences for contracts that's been multiple years.
The second component is making intro departmental transfers to cover deficits in major categories. So this is where an agency is projecting to be over budget in one area, but they can cover that by moving money across objects.
Number three is appropriating half a million dollars from contingent reserve to agency budgets to cover projected deficits.
Number four is increasing budget authority for Metro transit.
And five and six are more technical in nature where we're making other appropriations and transfers and amendments to the capital budget.
This is more of a technical item and conferences that are outstanding at the year end can be carried forward until the next year.
This happens a lot with services that span multiple years. So an agency might have started a contract at the end of 2025.
That purchase order and conferences carried forward into 26 and there is a transfer to the budget in their agency budget to increase their overall budget authority to recognize this carry forward.
In the general fund.
We had $356,000 in carry forward and conferences across multiple agencies.
We do budget for this indirect appropriations. We have $400,000. So this resolution is a technical adjustment to move the budget authority from direct appropriations to the agencies and current costs.
And then in the library fund and public health fund.
There are most funds do have some level of carry forward encumbrance for the library fund and public health. We're proposing transfers to increase budget authority for this amount and using fund balance applied to cover this expense for the library.
It's about $29,000. This is mostly related to the timing of private donations and expenses related to services offered.
In public health, this is a larger amount of $430,000 and public health has sufficient fund balance to cover this.
The second item is, again, intra agency transfers so agencies that have under spending in one area can propose transfers across what we call major expenditure categories.
So we're also proposing money from supplies to salaries or benefits to purchase services. So this is a pretty modest number that reflects just cleaning up the budget and truing it up to where agencies are actually spending money.
The assessor having higher non personnel costs. So they're moving $25,000 from salaries to supplies and services civil rights is proposing transferring $20,000 from benefits to translation and interpretation services and traffic engineering is proposing
moving $38,000 from benefits to supplies and services.
As mentioned in the fleet fund, they are projecting over budget for vehicle repairs and maintenance, but have enough savings from salaries and benefits to cover that cost at this time.
There are two areas where we are proposing appropriate transferring money from contingent reserve to agency budgets and this is areas where an agency is projecting to be over budget in a non personnel major.
And with non personnel items, the agency will hit a budget stop that will not allow them to spend beyond their budget.
So these are cases where agencies really need to transfer from contingent reserve to be able to continue providing the level of services expected for the remainder of the year.
These transfers are for the clerk's office addressing the budget stops in supplies and services related to election supplies. So that's moving $400,000 from contingent reserve to clerk's office.
And with engineering transferring $100,000 to the budget for facility maintenance supplies.
Engineering has been seeing higher costs for plumbing, HVAC, other tools related to inflation for several years. They've typically had enough salary savings to be able to handle this through an interdepartmental transfer.
And as I've mentioned with several other agencies, they don't have the level of vacancy that they used to have. So they would need a transfer from elsewhere to cover this cost.
So the Metro Transit, I'm going to very briefly talk about this and then Jamie will go into more details. But the major projection estimate estimates Metro will have a deficit of $4.2 million.
And this is a combination of revenues coming in below budget and expenses being higher than budget.
And the resolution itself does not address the full projected gap of $4.2 million. What it does instead is really focuses on the areas, the non personnel accounts that would hit a budget stop.
So what we're doing is increasing the supplies for budget and purchase services by about $3 million collectively and using a unbalanced apply to count as the revenue source to balance the transfer.
And this allows Metro to continue providing their services without hitting budget stops. It allows us to refine the projection throughout the rest of the year.
It allows Metro to evaluate federal available federal sources.
And the year end resolution will have a lot more information about addressing the full the full Metro gap.
And then I have two more slides that are more technical in nature, so I'm going to address them quickly and then I all pause and we can see if you want to keep going with Jamie or you want to ask some general questions first.
So, category five is kind of our everything else bucket of other appropriations and transfers.
So in a number of areas, this is recognizing higher revenues or grant revenues that were not included in the adopted budget and appropriating those revenues and expenses.
So for golf, this is golf continues to have strong performance. We are increasing their revenues and associated expenses for the services they offer.
Higher department had a large grant for in state funding or EMS funding assistance program.
That was not included in their budget. So this appropriates $854,000 in revenues and increases supplies and purchase services and parking similarly had a grant from with stock that they applied for and received, but was never recognized in their budget.
So increases their budget for grant funds and reserve supplied for their local match and increases their consulting expenses.
And then there's I've mentioned madcap a little bit in terms of the earlier appropriation from contingent reserve to the utilities.
The earlier this year when we adopted the resolution to fund madcap through the general fund, we assumed that the program would be administered by allocating costs across all of the utilities that are impacted.
So we transferred money to storm water sewer and water after further after that was adopted and further discussion with staff.
There was a consensus that it would be more administratively efficient to consolidate all of this.
Instead of allocating across utilities centralized administration of the program in water utility. So this is a technical transfer to move the money that was allocated to sewer and storm into the water utility.
And then finally, the last component is capital budget transfers and adjustments.
So this resolution has a long list of projects that are being amended in almost all of these projects.
The project budget is increasing by using a non geo borrowing funding source.
So projects span engineering fleet park sewer and water. And these are mostly small increases to total project budgets based on proceeds from insurance payments donations reserves and other sources that do not rely on borrowing that
we got more information about these final numbers and need to make a budget adjustment to be able to appropriate that money.
And finally, there are, there are some amendments related to funding.
So in CDA redevelopment for the South Madison redevelopment project, there are two actions being taken. One is transferring $5 million.
Of TIFF, 51 increment that was budgeted and CDD affordable housing to CDA redevelopment for the project.
And the second is appropriating an additional 5 million and 51 increment.
That's based on an adopted project plan amendment that was approved earlier this year.
And then the final item is really a correction to an error in the budget where we had included.
1 million, 40,000 in TIFF increment to the Madison Lake way project.
And this should have always been presented as TIFF supported geo borrowing from 53.
So that was a mistake that we are correcting now. I changed funding sources.
So that's a last of my slides. I'll pause and see what.
How the body wants to proceed in terms of Metro or questions now.
Any sense of the body should we keep going through the presentation or do you want to have questions, President Madison?
I want us to keep going.
Any objection?
Seeing no objection, we'll go ahead.
General manager Acton.
Hi, good evening, Jamie Acton.
With me, I have our new finance director is all we refer to him as Buddha lovingly.
So he'll be joining me into tonight's presentation to help just fill in some gaps.
If we, if we run into some questions as we both are relatively new to.
This is my first full year in the budget process with the city and just a few months and, but happy to have him and really.
Diving into where we're at today. So, you seem to have our slides.
Great. Thank you.
Can everybody hear us? Okay, we're kind of chest, so not a new new situation with audio today. So.
Okay, so big picture right now.
Metro is over budget and essentially will have been for the last two budget cycles. So in 25.
We came to you late with a about a $5.7 million deficit. And then as Christine was then talking today.
We are currently projecting 4.2.
So obviously the 26th gap is smaller, but we still are in a situation where revenues are below budget and our expenses are above the budget.
So that is essentially, you know, looking at our revenue projections and the estimates that have been given for prior budgets, the rates of providing service that haven't been keeping pace with our actual costs.
And then those actual costs continue to rise and they aren't in line with our current operating realities, whether that is service level or contractual agreements or whatnot. So, as Christine mentioned, our immediate need right now is to have the increased budget very authority to be able to make sure that we continue to purchase supplies for the buses to continue to do maintenance on.
And then also an increase to purchase of services, which is primarily our paratransit contracted services that we are federally required to provide since we also provide the fixed route service.
Next slide this.
So, where does Metro's money come from in 2026 we had these four main revenue streams, you'll see the general fund or the city subsidy is about 30% in the orange top right below that we've got the intergovernmental funds, which are essentially
federal and state grants or funding that provide us with some operating expenses and assistance that's about 31%.
We have other which is kind of a mixed bag of wheel tax registration fees, advertising sales, insurance, recoveries, and just some some miscellaneous revenue. And that's about 9%.
And then we have our purchase of services, and that is our contracts that's our fares that's our passes and that accounts for another about 30%. So, that's where we're sitting there.
Next slide please.
So just a little bit more about these revenues so our service contracts as we entered into them.
They auto renewed last August, so for another five year period for some of them.
These are everything from the community contracts that we have with other municipalities to provide service.
It's a mix group of agencies, organizations, communities that are purchasing service from Metro that we provide.
But we have found based on the information that we're required to report to the federal transit administration is that those contracts were not initially set up to cover our full cost of providing said service.
So we're running into some challenges around that, and those will need to be adjusted and addressed.
We also have an outdated agency ferry for a pair of transit clients that have rides and trips booked through different agencies.
That hasn't been touched since 2023 or transit is definitely one of the highest modes of transportation, but it is also one of the most critical modes of transportation in our community.
The next update is fair capping and pass sales. So we have some housekeeping to do around fair capping pass sales and really looking at the way that we are applying this and how we're doing it consistently and what our process and our policies are around.
Fair capping pass sales. Is there a way that we can simplify this is there a way that we can be more consistent to be able to give ourselves some more.
I guess brown truth revenue projections in the future.
And then we also, as you saw the federal and state of funds that are.
Provided to us annually these intergovernmental funds have not kept up with inflation, and they have not seen increases over the last 10 years, at least since what I've been looking at that that would really keep up with our actual costs to provide service and to to be able to cover those costs.
Those are some of the challenges around around our revenues that we need to kind of dig into and dive into. So the next slide please proceed.
Talks a little bit about our federal funds and how we can use use the federal funds. So every year we get specific categories we get for four categories three are shown here.
And then the discretionary the one that's not shown here is a 53 10 program and that's a pass through program and it's actually a program that we administer for the rest of the county to be able to utilize so we get it, but then we promptly put it back out into the community for transportation
around seniors and people experiencing disabilities so.
We have these categories.
They have a lot of rules. They have a lot of eligibility requirements. They have a lot of timelines and reporting and just draw down processes, and they all require a local contribution.
And we get that local contribution from the general fund for certain parts and then we get our local contribution from the capital budget as well.
The thing that's important about these monies is that they can be combined, but they are their dollar amounts and usage cannot be transferred from plateau time essentially. So we have a lot of moving pieces and parts around the federal dollars.
But some of what Christine had mentioned about us not necessarily needing to come in for a subsidy at the end of the year is going to be tied to our ability to leverage these federal dollars and what we actually have available to us this year.
We are leaving no stone unturned and starting to dig in and really see where the flexibility in the federal funds live for us to be able to to try to fill this down.
Next slide, please.
So what are major cost factors impacting our 26 budget.
Metro provides a lot of its service existing service throughout the entire department that it relies upon with over time dollars. So that is, that is definitely driving our costs bus parts bus parts came in in 2026 higher than anticipated.
So, the warranties for the new buses, the six buses are now no longer covered by the vendor and we are paying for those replacement parts directly.
Those parts that have seen increases in their costs, and they just weren't reflected in the 2026 budget.
As I said before, this is federally required by anybody that provides fixed route services.
And it's essentially for people that are unable to use the fixed routes, something prevents them from from using fixed route or BRT.
When our servicing area changed on 2324 and then 25 are paratransit demand increased as the service area expanded naturally.
You are required to provide paratransit service within three quarters of a mile of the fixed routes.
And so we definitely saw more demand around that.
And then, but we also have three providers with three different contracts and different terms and escalators and costs that are tied to providing paratransit service that we saw things later or earlier this year, like fuel turf fuel surge charges and things that we hadn't had.
Come into play in previous years. We also are on the final year of our contracts with these three providers. And so we will be going out to RFP in 2021 this year to begin a new contract in 2027.
However, I do not see costs nationwide, reducing for paratransit services, if anything, they continue to increase. So we are starting to look at what that that looks like for the 2027 budget.
So those are some of the major cost factors for us right now in the next slide, please.
So what are we doing to look ahead. Like I said, I'm incredibly grateful that Buddha is now here and looking to dive into all of our finances here at Metro.
Short term third quarter type activities, we are going to obviously continue to actively monitor all of our spending.
And I think that it's important that not just with the spending, we're looking at how we're spending and where we can use our eligible federal dollars to either charge against or back bill, essentially, where we should have used federal dollars.
We also have several grants in place that allow staff to be charging time to, and we need to go back and look at payroll and make sure the appropriate staff is charging to the appropriate grants and if we can back that out of the operating budget that we do that as well.
And then we need to start having these conversations on a larger scale about our service contracts and what that rate increase would look like for for our partners that purchase service from us.
We also need to start longer term mid term order for. We need to start the process for updating the paratransit agency fair. We need to start the process for updating the unlimited ride pass.
We need to take those to the transportation commission and start the public process around what that looks like.
Last year, when I learned about the deficit, we immediately did a purchase card cut off, which basically throws all of our discretionary spending are nice to have.
I mean, not necessarily our needs. What this does mean is that safety, security, preventative maintenance, day to day maintenance, anything like that will still happen, but we will pull off on other purchases that we can make at a later date or with a different funding source once it becomes available, but really trying to protect the operating budget.
At this point, and then they'll start to look at what those revised service contracts would look like for 2027 and begin, you know, negotiating and and seeing what we can do around those service contracts and get those right sides as best possible to be able to cover.
Cover the costs. So next slide I think is the last.
So yeah, that is just kind of a brief overview of where we're sitting right now. I'm happy to answer questions and want to see where the scene's sitting to on.
Not, but.
Defer to proceed.
Thank you.
I think questions now for on any of the presentation.
If there are any, that was a lot.
I'll do a bit of her.
I'll start with Jamie since you went last.
So one of the questions I had since paratransit services.
Costs are going up and in part, that's because our service area has increased.
Our partner municipalities.
So lack of better will phrase paying their fair share for paratransit in their communities.
So my understanding of the way that the contract rates are paratransit is being captured.
But I do think that this is probably part of the rate adjustment that needs to take place because we know that the cost of providing paratransit has increased as has the cost of the fixed route and would be hurting.
So we need to kind of lump those together and right sides that that rate and go from there.
And we won't make those adjustments this year. We'll just make them for 27. Is that?
Yeah. So are any of the adjustments that Metro makes right now will have to follow up pretty rigorous public process, whether it's increasing rates or is, you know, looking at service or whatnot, but yeah, it all will have a process.
And I would say we are starting in now.
And hopefully there will be savings that are realized as sooner than later, but I'm more so projecting in 27 and beyond.
Yeah.
Jamie was Jamie first and then, or how you want to do this.
Let's stick on Metro and I'll come back to you all there. Thank you.
All their Matthews questions on Metro.
Yeah, thank you, Mayor.
Just a follow up on evaluating the paratransit rates is that do you mean the individual rates that folks using paratransit would pay or do we charge the neighboring?
Like, do we manage that for neighboring municipalities as well? And are you meaning like a rate that we would charge to, you know, some prayer or something like that?
Yeah, thanks for that. So there's kind of three different things around paratransit right now. So we have the individual writer rate and fair.
That is not looking to be adjusted at this time. What we're looking to adjust is the rate that the brokers come in and pay to us.
And that is what hasn't been adjusted since 2023. So I think right now the agency's per trip or paying around $34 $35 and that needs to be adjusted.
The rates that the contracts of the partners that they are paying takes into account of the full fully loaded costs so providing paratransit.
And we then have a formula that we work through that will then associate with the fixed routing and paratransit that those folks will, well, excuse me, be paying, but that will be based off of the information that we provide to the federal transit administration
and how we give that fully polished. So that is not any part of like a process per se that's guided like the fair increases to writers would be.
And then even this agency fair that that has a very prescribed process, but the contract rates do not.
Great. Thank you so much.
Thank you.
Thank you.
Thank you.
Thank you.
All the other questions for Metro.
All the revere.
Thanks very much, Mayor. Yes, sticking with Metro transit budget questions here.
First, thanks very much for being here.
Jamie.
I want to go in this committee meeting about in our operating budget outlook for next year that.
Metro, according to our finance department staff was anticipating a $9.5 million additional Metro subsidy needed.
And there were a lot of questions at that time in my mind and I won't.
I know we don't have the time for me to ask all of my questions now, but your presentation was extremely helpful as was.
Well, I think that's a good question.
I think it's a very good question.
I think it's a very good question.
Because presentation as well as relates to Metro.
I want to state at the outset that I realize that you inherited a lot of these issues.
Same with certainly our transportation director Christof who I know is with us for this conversation.
And certainly Buddha has a recent.
So I acknowledge all that and I'm sorry that we're in this situation, obviously.
My first question, just speaking of personnel is.
And the fact that you inherited a lot of these issues is do we still have the assistance of some former Metro.
Finance staff that we're working part time coming out of retirement to help us, namely Wayne block and.
Kathy Schwann to folks that we used to see a lot of finance committee meetings before they retired.
Are they still helping out along with the history of Metro finances, et cetera.
Yeah, that's actually one thing that has been.
Really great actually to have is Wayne kind of in our back pocket to be able to reach out and be like, how did.
How was this calculated? How did we do this? How, how were we using that and Wayne actually just helped us.
Get through our single audit and whatnot. So I know you've been having conversations and other staff.
We've been having conversations with with Wayne Kathy Schwann.
She was ready to go off and be retired. So we've had less interaction with Kathy since I think it was back in December.
She decided it was she needed to go.
Be retired. So less less with Kathy.
I appreciate that. And I generally can't be graduated. I'm happy that you have Wayne as a.
Institutional memory to help you with the financial issues. So you're struggling with here and.
Working to get Metro's financial house back in order, but why don't I.
Perhaps ask some questions.
And no particular order I will admit.
Beginning perhaps with the service contract issue and admittedly as policymakers.
Haven't seen or heard much about the service contracts.
Since we kind of reformed the process many years ago where individual contracts no longer go to the.
Transportation Commission or the common council and.
The more handled administratively, as you said, kind of auto renewed and so forth.
So as it relates to those service contracts, just to make sure that we're on.
I am understanding correctly the service contracts.
That would include our contracts with major employers like the hospitals UW correct.
So we have a variety of contracts. We have the partner agreements with the communities.
We have the W contracts, but actually we have two with them.
Hospitals, the other colleges, the ones that auto renewed that I mentioned,
those are the ones with the the partner communities and they do all have clauses in there that.
That are real winners that we can come back and say, hey, we need to have some conversation.
And, and this Warren conversation.
Yes, thanks. I'm glad we're clarifying the vocabulary here. So,
so service contracts do include inter inter governmental.
Local partners.
Like say, Fitchford, Middleton, Sun Prairie.
Right.
Okay.
And then our service contracts also then are also included, as you say,
UW employees and hospital employees, UW student bus paths. Those are also.
All service contracts that I have re openers.
Closest.
Everything has a flaws to it that we can come in and in either reopen or terminate and.
Start fresh or whatnot.
Why don't I pause there because I see Kristoff mayor is seeking help to answer my question.
Yeah, no, I think it's worth probably separating that we have two kinds of contracts.
One kind of contract is basically a fair contract where.
Somebody has a contract with us where they essentially bulk purchase fairs.
The other contract is a purchase of service contract where somebody has a contract with us where we operate service.
In some cases like UW, they have both of those.
And both of those obviously have different economic drivers when we're purchasing fairs.
The question is what rate are they purchasing those fairs at compared to what a regular rider pays.
When we're purchasing when they're purchasing service, the question is,
how does that rate at which they're purchasing the service compared to.
The actual cost of operating that service. So in terms of purchase of service, we have the school district.
We have UW and we have partner communities in terms of purchase of fairs.
Partner communities aren't doing that.
UW and MMS DR and then a number of other employers are doing that.
Yeah, thank you for the clarification, Kristoff.
So one of the you anticipated some of my follow up questions and again,
anybody can answer these not directed to anyone in particular.
One of the areas that we've heard in the past, particularly when Eric,
Eric nep talking in this committee forum.
About financial issues when he was interim general manager was the MMS D Dodger.
School service.
And those monies that never materialized to the extent that we had anticipated.
Could you, many of you speak to that and.
Sure. Yeah, we recently started having conversations with MMS D around the way that our work roles are formed.
And we essentially run that service on 100% over time, essentially.
So MMS D was able to raise.
Essentially their budget line item for.
Purchase of transportation through us for the 20.
I always get their school years wrong.
They're 2526 school year and then going into the 27 and 28 school year.
Minimally, I think we saw that go from about 700 and.
You have 780 K to about 1.2 million.
Whereas our fully loaded costs is.
Well, into.
Two and a half three and to provide that service. So we've already started to have those conversations around.
What does it look like and where can we start to.
As Metro look at providing that.
Level of service that they require and that they need for their students.
And how we can do it within our existing contact and work roles with our employees and how we, we make that work happen.
And how we can, I guess, kind of both come out in a position where.
Where it works out for us to be able to provide the service and then vary.
So to help fund the service at the right size. So we began to have those conversations.
That's, that's great to hear.
And is there relates more to overall overtime and obviously you would share with us with the current estimate is and.
Deficit for overtime. I know much of this is built into the teamsters collective bargaining agreement in terms of some guaranteed overtime.
How much of the overtime projected.
Deficit or the overtime contributing to your projected deficit.
Would you say relates to the MSD.
Dodger issue you just spoke of.
Is it a fair amount?
Doug into that dollar amount exactly, but we could probably get you that dollar amount.
The one thing that I would say is that we are experiencing overtime from not just the operators is also in the shop with the mechanics and keeping up with our maintenance and then also, you know, across administration.
And the work groups that are doing some other behind the scenes work, whether that's our payroll and timekeeping people or our admin staff and why not customer service reps.
So we could probably get that broken out here relatively easy and provide that if that would be helpful.
Thank you. And all of, not all of those folks, but most of them are covered by the collective bargaining agreement, correct mechanics, the dispatchers.
No, not so much in the dispatchers.
Essentially, we've got our operators. We've got some training supervisors in operations. Everybody else is non rep. And then we do have our customer service reps and are some people in time keeping an admin that are representative and then our shop employees.
So I can get that broken out too if that would be helpful.
Thank you. Is it fair to say that.
A good portion of the overtime is built into the collective bargaining agreement or would you say that that's not necessarily the case and it's more that you just start dealing currently with still a number of vacancies is I think since the pandemic metro in particular has had.
Unfortunate problems with recruitment and retention.
Yeah, I think I think we have some, some level of vacancy, but I do think that there is, you know, there's, there's some things built into the CBA that definitely drive, drive overtime.
And how are you doing with vacancies would you say, especially operators.
Operators right now are looking.
Okay.
The last numbers that I saw.
We were.
We were made, we were getting ready to start a new class. And so I think we had just wrapped up interviews.
I want to say.
For some reason, 10, I've been looking at a lot of numbers and for some reason, like, 10, 10 is standing out to me right now, but I can get vacancy numbers for you as well.
Thanks.
I appreciate that. These aren't time sensitive questions by any means.
And then moving into paratransit follow up question or two there.
The three current providers whose contracts all expire at the end of this year.
Do you know at this point, if each of those providers is interested in continuing their relationship with us.
So actually the contracts expired June 30 of 27.
So we have, we have time to get a new RFP out and we have a draft.
At this time, I have not heard that anybody's not interested in submitting a proposal for paratransit.
But I do know that we're, we're looking at the RFP in the way that we're needing to deliver service and making sure that that is a high quality, high customer service focus. We're receiving.
We've been having some challenges around paratransit and some of the contractors and some of the behaviors that we've been experiencing and some deficiencies in the program.
So we're looking at really standing that program up in a different way. And I have not heard yet that the three writers would not submit.
Or submit for the RFP.
Yeah, so I think it's, I appreciate that. It's important to acknowledge that.
I think all of us on the council have probably received concerns from paratransit writers about their difficulties that they've had with their experiences.
And I know that you're well aware of that Jamie.
And we're actually giving a presentation on Wednesday nights.
Tc.
Tc about those.
Yeah, one of the things I noticed when I looked at that.
Right.
PowerPoint presentation that you are anticipating sharing a Tc meeting this week was the.
Suggesting hiring a mobility manager.
And I was surprised that I always thought that we had a paratransit manager.
But apparently is that not been the case that we haven't had a position like that recently.
Yeah, my understanding is that there was some movement in the org chart around paratransit and some shifting and that.
There was essentially after after the desk settled, I paratransit supervisor.
And to paratransit.
One was an eligibility assessor and I believe the, that's the working title.
And then the other was essentially a rights coordinator.
And they were, they were standing up the program in conjunction with the customer service representatives in conjunction with.
Some support from the customer service supervisor. It was, it was kind of an all hands on deck to submit and transit.
Off great. So.
Yeah, my goal around that would be in, and we have a position available that would be converted into that would be essentially to really do a lot of the oversight and the contract management and get into that day to day.
So looking at the quality of the program that's being provided and having those regular meetings and really able to support the staff and stand up the program in a way that I would, I would think that we would all want it to talk to me.
Thank you. I want to ask too many more questions. I know we have other general questions of the finance staff and, and then folks from the community that probably are waiting to speak under general public comments still.
So I'll try to not ask too many other questions, but perhaps here in closing, as it relates to, to Metro transit.
When we received, as I mentioned earlier, our 2027 operating budget outlook from the finance team at this in this committee a month ago and then the council received the exact same presentation a week later.
Director Schmidicky had had mentioned three main reasons why.
At the time, at least they were projecting at nine and a half million dollar additional Metro subsidy from the general fund next year and and increase personnel was one.
And the third was the rising fuel costs. And if you, if we, if I'm perhaps I missed it, but I haven't heard fuel mentioned yet in the, in this discussion.
Obviously we're probably electrifying the fleet here. And so it's not as big an issue as it would have been years and a few years back.
But could you speak to, to the diesel fuel prices and so forth and how that's affecting your agency and, and how that fits into the projected deficit for this year.
Yeah, so right now our fuel costs are currently locked in at a relatively affordable rate, which is why you're not seeing it be such a huge driver.
My understanding and Dave, I correct me if I'm wrong, I'm not completely familiar with the details of the, the contract for the city's fuel, but that rate is not going to be held going into 2027, which is part of the protection of the increase that you'll see associated with fuel for
us then. So we'll go from a variable. It sounds like a locked in rate to a more volatile or variable rate.
That's correct.
Yeah, that makes complete sense. Thanks for explaining that. Dave, do you want to speak to do you know when then are the current contract dance.
Right. So we have futures contracts on Metro fuel, basically through the end of the calendar year, depending on how much fuel Metro uses their might that might go into calendar year 27.
But that's not really expected. So.
That's the, that's the cost increase that we're seeing in 27.
Is, you know, that relative change in price per gallon coming off of the futures contracts for Metro.
And then perhaps ending with online part with questions about Metro transit.
Why don't I perhaps ask you, Dave, then my last question on transit and that would be.
It's obviously done about a month since you provided at least this committee or 27 operating budget outlook.
Would you still say that today your team would be suggesting it's you're still estimating a nine and a half million dollar additional Metro subsidy needed for next year.
And we just got agency requests and we still need to talk with Metro.
About their specific requests. And so that's the best number we have at the moment, but we continue to look at I think Jamie talked about this as well.
Really refining the federal estimates, how we can use those federal dollars.
And so that's an ongoing process, but.
At the moment, the nine and a half million is what we have.
Thank you. Appreciate that. Thank you. Jamie and Chris stuff.
Oh, you back there.
Thank you.
Thank you.
All right.
Questions for Metro.
Yes. Thank you, Madam mayor.
Thank you.
General, I tend for your presentation. I shouldn't know this question, but answer for this question.
But I'm going to ask I worked on a transportation board before.
So, um, she know the number there, but is that number used mentioned about 60 vehicles out of.
Um,
My, um,
warranty warranty.
Thank you.
Is that what is what percentage of vehicles are those are? Is this historically high number or are we looking for.
Um,
larger maintenance costs because of moving forward as they getting older.
And, um,
Is that means that we also need to other additional replacement of all of those vehicles?
So the 62 vehicles that are now out of warranty are the vehicles that are associated with BRT.
So we received those in a large quantity pretty much in a very short period of time.
And so they all came out of warranty basically at the same time as well.
So, um, I think we will continue to see costs associated with all vehicles go up at this point.
Just based on supply chain demand.
Um, we know that we only have to, you know, essentially manufacturers in North America that we are able to use for Terra, not the Terra.
Oh my goodness.
We're looking at new flyer. Sorry.
I'm thinking about waiver that I have to get. Um, we have new flyer and gilling buses in our fleet. And, um,
Once they get to a certain age and mileage, we are able to utilize aftermarket cards, but those parts are not produced in mass quantities and the rest of the, the,
you know, the country is also looking to try to get their hands on them. So, um, you know, cables that we had initially thought that we're going to be around $5,000 or now $8,000.
You know, things, things have just continued to possibly just continued to increase in the maintenance. So I think we'll see that across across the country.
So, um, we have a lot of people who are in the community here, but we do have 62 of them. So it's 100% of our, our BRT fleet at one time.
Um, and so we are starting to look at ways that we can try to manage our inventory needs, manage our preventative maintenance within the intervals that is required by the federal government and really kind of keep on top of those things.
And to consideration for choices in the process.
My assumption, so moving forward for 27 and up, you're going to be putting those into your productions. So we'll not be.
Yes, we also do have older vehicles in our fleet that we are looking to retire and that we will be looking to right size our fleet.
We have a bit of grant money that we will be able to kind of increase the, they call it the state of good repair and basically, you know, bring newer vehicles in transition older vehicles less efficient vehicles out.
But again, it'll be a delicate balance of, of how many do we bring in at one time versus our service level and making sure we have what, what is called our spare ratio right size, because we, we can't just have a bunch of buses sitting and waiting.
We have to have an exact right number based on our peak level of sickness.
And I would add on the warranty front.
These 60 something buses are our first electric articulated buses. They are a new kind of bus in the fleet. So some of what you are seeing here too is our mechanics are supply chain ramping up for a new kind of bus.
We were not operating or maintaining before. So some of that, this has been the understanding of what it actually cost to maintain them, which is a different world than the diesel buses we were operating before.
So this is simply a new type of bus that we haven't been as familiar with and therefore it was much more difficult to estimate what they would cost to maintain.
And all with the experience that we have, we, I'm assuming we'll have better projections for the next two years on and think right.
Yes, I would hope so.
Thank you. Thank you, Elder. Are there any other questions for Metro.
Seeing none, then we'll go to the general questions for Christine.
All the bit of her. Yeah, so thank you, Christine, you'd mentioned the amount of work it is to do these major budget updates and then it takes a couple months.
And so I guess my question is sort of more about efficiency. Like, are there software systems or other platforms that would help allow for these updates to happen on a more.
Ongoing basis so that you're not sort of like basically every three months having to do this big job over and over and over again.
Thanks for that question.
Our team is definitely looking into is interested in creating efficiencies and new ways of working.
I would say we haven't specifically looked at alternatives to budget projections, but have looked at technology to streamline production of the, the budget book with the digital budget book tool.
So that was a really our big focus the last last year or two. And I think it's on my high priority and my work plan to make this easier for all of us.
Excellent.
And then my other question was specific.
So we know that the federal Republican.
The beautiful budget, whatever the heck it's called is going to kick a heck of a lot of people off Medicaid.
And that's going to impact all of us in terms of higher healthcare costs going to impact.
And that's probably more than a higher ambulance runs, but it's also likely going to impact the number of people who are going to have Medicaid coverage for ambulance runs.
So just wondering if we have built in a projection going forward for when that takes effect.
And that's really more about 27, but it was one of the things that you mentioned, it was the ambulance charges.
So just wondering if that's being taken into consideration for 27.
Older vinegar, we, we really don't know that that impact will be on ambulance and things like that.
The ambulance revenues that we're referring to is a new Medicaid waiver program that the state put into effect.
It's called the general emergency medical transport.
Program, and that means that we get more Medicaid reimbursement on those runs for Medicaid eligible individuals.
And that has resulted in back payments from both.
2023 and 2024, I believe that have increased ambulance revenues and we expect going forward.
That those ambulance revenues will obviously remain elevated due to that waiver program.
And then we'll continue to monitor actual runs and things like that.
And impact on both revenues as well as the waiver program and things like that.
But definitely this enhanced Medicaid waiver payment has resulted in additional revenues and will continue to result additional revenues coming in through the ambulance fee.
Thank you.
Thank you.
Are there other questions on the budget presentation?
Well, they're here.
Thank you, Mayor.
And thank you, Christine, for your excellent presentation.
It helped answer several of the questions I had just reading the resolution over the weekend.
So I did have just one question and one request.
I'll start with the request.
Is it possible for you and your colleagues to try to make the agency projection review Excel spreadsheet.
Convert to PDF file in a more so it's more readable, not only to us, but the community that might be accessing this register file.
Several of the column, the commentary, you probably haven't noticed yet.
The words are cut off and you can't read like the ends of some of your comments.
So I was hoping you could bet that your convenience may be make another effort to convert that Excel spreadsheet to a PDF.
Yes.
We don't lose any information.
This was brought to my attention at the beginning of the meeting and I've since re uploaded that Excel file. So you should be able to open it.
Okay.
It had converted to a PDF unintentionally that had the cut off issues, but I've re uploaded it as an original Excel file. So you can have full access to the data and expand and review cells. So I believe the public facing
has been had the correct attachment for the last hour or so.
Terrific. I just need to refresh them. Thanks very much for that. Good news.
And then speaking of your helpful agency projection review Excel spreadsheet.
I see fire chief carbon is with this. I just want to acknowledge.
I don't have a question for you, Chris, but I do want to acknowledge is that how great it was to see finance.
Your turn your camera on anybody. Let me just say a congrats to you and your team.
It was so great to see finance deaf confirming full staffing for your agency and the best overtime projection I've seen in years.
I don't know if you've sent you to turn on your camera. If you want to say anything about that and how you achieve that.
No, I won't go into a lengthy reply, but I'll just say thank you for the support and allowing the recruit class sizes to continue.
And that's really helped us over the last three to four recruit classes in order to catch up, maintain that staffing and allow the creative staffing program to kick in and be more effective.
So we really appreciate the support.
Thank you. Thanks very much again, chief.
And then lastly, my question for you, Christine, as I was just curious and, you know, in response to one of my questions, Dave mentioned earlier, you know, reminded us that agency operating budget agency requests were only recently submitted.
I know they were due on the 17th of this month.
I was just wondering if you could give us an update as to what your best guest estimate is to win those agency budget requests will be available to be viewed by us policymakers in the community.
Online.
We're aiming for next week. So if you go to our budget webpage will note, we'll have two deadlines under budget request. We have the date that it was due from the agencies and our anticipate, anticipate a date of publication.
And we currently have eight three listed.
We're building the request in the digital budget book for the first time to try and use some of the benefits of the new platform that we.
Have purchased for the operating budget. So we're still working through some of the logistics and if that date changes will update our website.
But definitely sometime next week.
Great. Thank you so much. I appreciate that.
Thanks again for all the helpful information today. Thank you, mayor.
Thank you, other.
Are there other questions for Christine or finance staff?
Right.
Seeing none, then item 18 has been moved and seconded. Is there any discussion?
Seeing no discussion. Is there any objection to recording unanimous vote in favor of item 18.
Seeing no objection, recording unanimous vote in favor of item 18 and then.
Would request a motion to take item one off the table.
Motion to take item one public comment off the table. They're good.
Moved and seconded to take it off the table. Is there any objection?
Seeing none. Item one is back before us.
I believe we only have one person on the phone.
In the zoom.
And so let me just jump to the list.
Can we have.
Our tech staff allow that person to speak and see if they are one of the registrants.
They should have permission to speak. I didn't see that number on the list.
But they are being asked to unmute as well.
So for the person who's listening on the phone, it's star six on your phone.
If you'd like to unmute yourself.
And if you were registered to speak to speak, if not, perhaps you could just confirm that you're not interested in speaking.
We'll wait a minute.
All right, it seems like not.
So we have no other registrants in attendance. I would just direct your collective attention to the.
Email comment that we got on item one.
And ask that you read that staff will send an updated report.
I believe that comments were still coming in through the meeting.
And so just ask that members of the body go ahead and read that report from staff when we receive it.
That will bring us to the end of our agenda. So I would entertain a motion to adjourn.
Motion to adjourn.
Moved and seconded to adjourn. Is there any objection to recording unanimous vote in favor?
Seeing none, we stand adjourned. Have a good evening.