May 8, 2025 — City Council Study Session

Transcript

Captions from City of Boulder YouTube recording.

[4:40] Alicia, are we ready to start recording? Well, um, good evening and good evening everybody. Welcome to tonight's study session of the Boulder City Council. I'm Council Member Matt Benjamin and really appreciate everybody joining us. It's good that we've got

[5:00] some nice weather following the rain. I don't know about you all, but I had a little bit of PTSD seeing three inches fall. Um although ironically, kind of weird, that's one sixth of what we got uh during the 2013 flood for for perspective. So, um lot of rain, but welcomed nonetheless. Um we have a pretty full agenda tonight. Uh we have three items. First, we'll hear information about the financial forecast. And the second item will be talking about potential ballot items and an overview discussion. And lastly, we'll have a discussion about a draft letter that was drafted by myself and council member Marquis on um really addressing the Boulder County Regional Opioid Council and whether or not council has interest in submitting such letter to sort of think about um some new avenues um for uh that work and those investments with the opioid dollars. So, we'll get to all of those fund pieces tonight. Um, but before we get to our work items, um, uh, let's see. I'd like to outline

[6:01] how we're going to run this meeting. Pretty standard study session. Um, we'll do presentations, then we'll have some time for questions, and at the end of the presentation, we'll sort of have a, uh, opportunity for a discussion among council members, and hopefully we'll get to some good place of understanding andor, um, any decent direction for staff. Um, we will now turn things over to our incredible uh, city manager, Nuri Rivera Vandermide, to introduce our first item and our presenters. Uh, well, I'm going to take the adjective uh, and move forward. So, thank you, uh, Council Member Benjamin. Uh, council, for tonight's uh, first topic, you're going to be hearing about our financial forecast. And I'll say that while I know the phrase has gotten tiresome, I've never been happier to have been operating from a financially constrained place as we are facing a moment in time that is truly difficult.

[7:01] Not just for us as a city, but for many of us as a community and all across the region and the state. When we started our budget guidance this year, we emphasize budget realignments, not program enhancements, not additions. But as the year has progressed and we have continued to monitor not just the forecasts for the coming year but our current year's budget, like so many cities across the nation, we have needed to adapt. As recently as Monday, we asked our departments to even be more conservative in their financial approach to the current year spend because the year has simply proven to be more uncertain and volatile than any of us could have ever imagined. The good news is that financial cycles fluctuate downward and pop back up. And the current snapshot in time is just that. We will come out of this financial cycle into better financial times, I hope. And what helps us weather that storm and do right by both our community and our staff is appropriate financial

[8:01] rigor, discipline, and adaptability. I'm not sure all of this was in the fine print for our new CFO, however. Uh, and so I hope that you'll be extra nice to our new CFO, Christa Morrison, who joins us from Kansas City, and it's her first time here. Uh, so I'll ask you to be extra nice. Uh, give her some time to settle in, get and get to know our departments, but rest assured that she's going to come and meet each and every one of you uh, pretty soon. she's already hit the ground running and joined this incredible budget team, which I know you know well. Um, and I think she's gotten to know them even more uh in the past two weeks. She's come to more meetings than she probably even thought uh were possible uh lately. So, let me turn it over to Christa to introduce herself a little bit as she will kick us off. Christa. All right. Well, thank you, Nuria, and uh mayor, members of city council. It is such a privilege to be here and part of

[9:00] the Boulder team. Um I am coming from Kansas City, Missouri and um I must say in my short two weeks here um I am so impressed by the leadership of Boulder as well as the finance leadership team. Um I do look forward to meeting with each of you ahead to learn more about you about you and your priorities for Boulder. Um, city manager Nura, you said everything about the economy and um, Boulder is in a better position than a lot of cities right now, but it is really unprecedented uh, financial times across the country. Um, tonight you will hear from Brian Ludenowski, the executive director of CU's Boulder Business Research Division, as well as the tremendous Charlotte Husky budget officer on the state of the economy and the financial forecast for Boulder.

[10:00] Boulder is very fortunate to have the partnership with Brian and CU as well as the tremendously talented budget officer and budget team to help navigate projections and advise during this time of uncertainty. Uh so with that, I appreciate the introduction and um I will hand this back over to I believe it's going to Brian um to and the CU team to speak a little bit more about um the state of the economy. All right. Thank you, Christa. I'm going to go ahead and share my screen. Uh, welcome to Boulder and thank you council again for the opportunity to share an economic update with you. I I'm just going to very briefly pile on for a second and uh praise the the budget team, uh, Charlotte, Joel, um, and and so on. They they work so hard to provide us with really detailed data and we have

[11:01] continuous conversations about the data. um we present them with a forecast and they ask a lot of questions, good questions. They challenge us on some of our assumptions and you you you just don't know how much we appreciate that relationship and the the interactions we can have with the team. We think it helps produce a better forecast. Um so I'm I'm going to uh briefly go through an economic update and then provide the the uh forecast update and then we'll open it up to questions. I'm joined tonight uh by my colleague Richard Wabakand who's on the finance faculty and al is also the faculty director at uh the lead school of business business research division. So, um, we when when Rich and I go out and speak, for the last several years, we've titled our talk, um, a resilient economy. And so, we we kept saying that over and over again. And then we got sort of tired of saying that. So, we

[12:01] started calling it a tenacious economy. And, um, and we have radically changed how we're talking about the economy this year. Uh, we we're titling it attention to the risks. And I think that's very apppropo for the environment that we're in because there are a lot of disruptions that we're facing right now. And um we're we are trying to sort of untangle what that means not only for the national economy but for the Colorado economy and for our uh local communities. So uh very big picture. We like to take a look at the basket of economic indicators that the National Bureau of Economic Research looks at when dating the beginnings and ends of economic expansions and recessions. And um I call this out because oftentimes I hear people say, well, the recession is two negative quarters of GDP growth. Um, but really when when you read the fine print of what the NBER describes as a

[13:01] recession, they say it's not just simply two negative quarters of growth, we take a look at a basket of economic indicators, and they may correlate with two negative quarters of growth, but that's not uh solely what they're looking at. So, this is this is more in line with the basket of indicators that they're looking at. Uh and for the last several years, we've shown uh arrows that are green and sometimes one or sometimes zero red arrow. And now what you're seeing here is sprinkled in a few more risks when we're talking about the economy and a downturn that we're paying close attention to. Um so we we did have a decrease in GDP in the first quarter. we see that uh consumer confidence and business confidence has come down. And so I think those are some of the risks, but we also do continue to see employment growing, income is up, uh and consumption is growing. So we're going to delve into that in a little bit more

[14:00] detail. Uh so first quarter GDP ended up coming in at negative0.3%. This was just released last week. And uh there are a lot of interesting movements within the components of GDP. So this is real GDP. This this is already adjusted for inflation. And uh the building blocks are simply uh consumption, investment, government spending and net exports. And what we saw was uh the the uh piece of uh the the major piece of GDP consumption slowed to about 1.8% growth annualized. And that was the slowest growth that we've seen in consumption in the last seven or eight quarters. We also saw government spending decrease. That shouldn't be a big shocker for us right now in the current environment. Um but on uh I think a little bit of the surprise side, we saw investment spike. Um and then we also saw uh a big increase in net exports and net exports

[15:02] end up detracting uh or subtracting from GDP growth uh because our imports uh really exceed uh exports by a large margin. So I'm going to draw your attention to this for just a moment because net exports in the first quarter ended up detracting from growth by 4.8%. Right? So you can look at that and say well but for the uh net exports piece we would have had a pretty good GDP report it would have shown pretty strong growth and and that's true at face value but I think the other thing to remember here is that uh inventories ended up spiking by um 140 billion in the first quarter and and so those two things are very interrelated right there was a rush to get product into uh the US across the US border before tariffs took effect. And so that really showed up in the uh record levels of imports uh in the US.

[16:00] We've never had the level of imports and we've never had that magnitude of change in um in imports in uh the history of the data that goes back to the late 1940s. Um and so as all of that product came in, it hit warehouses and so we saw uh a huge spike in inventories. We also saw a a a really strong increase in um in equipment investment piece that shot up 22% wasn't building new structures, it was investment in equipment and um I think some of that could also be related to tariffs. This rush to bring expensive equipment in before uh before the tariffs take effect. um but other components of uh equipment investment take longer to plan. So I I wouldn't think that all of it is related to that. So I point this out because these are distortions that we have expected uh but now we're able to actually measure it

[17:01] and point to it as impacting the economy. Um on on a good news front, the labor market continues to be resilient. So what you're looking at here is monthly employment growth since 2021. And uh the horizontal lines are showing the average annual growth per month within the respective years. And what we see is that 2021 was a rebound year from the pandemic. In 2022, we we reached new peak levels of employment in this country. And then we continued to add jobs. And I would argue we've added jobs at a faster rate than expected because we have a labor supply uh uh issue where uh demographics are not exactly working in our favor. Uh right now we're at peak levels of labor force. We've never had more people working or wanting to work in this country. Um the last six months are the highest six months ever for US labor force. And so naturally, we're going to see this

[18:00] slowing in job growth if we're running out of people to take those jobs. And uh also on the good news front, we've continued to see growth in personal income. And an important component of that is a wage uh growth. Uh not only are we seeing nominal wage growth, but we're seeing real in inflationadjusted wage growth. And that is sustained now for about a year and a half. um inflation. We've paid so much attention to this since uh inflation started to spike in uh late 2021 and 2022. Uh the the inflation rate rose very uh quickly. It took about 16 months to hit peak inflation before it started to drop back down and it took about 12 months for inflation to come down and touch 3%. And now we're actually oscillating between 2 and 3% for the last several months. Uh the the national inflation rate dropped to 2.4% last month. We're going to get another inflation report next week. And even

[19:02] though there's been a lot of talk about inflation um uh in relation to tariffs, personally I'm expecting a drop in inflation in the next report and it coincides with the big rise in inventories that we saw in the economy over the last several months. So the goods that came in came in at those regular prices and now they're cycling through the economy. So, um, my expectation is is lower inflation, but my medium-term expectation is for inflation to rise, um, as these tariffs are in place. Colorado tends to have a higher inflation rate than the national average. Uh, 11 out of the last 15 years, the Denver metro region has recorded higher rates of price growth than the US city average. um 2024 inflation came in below the US city average and that's continued into 2025 where the Denver Aurora Lakewood MSA is at 1.9% compared to 2.4% 4% for the

[20:01] nation. And uh it's really important to draw uh the housing component out here because um housing makes up about half of the basket of goods and services now that households are spending their money on. And uh we have now had slower home price growth and slower rent growth than the national average, which is muting out some of the inflation that the rest of the nation is experiencing. So the the volatility that's uh that's uh really happening nationally and globally when it comes to tariffs or the federal realignment or change to uh immigration status and so on um is creating uncertainty and the way that we're measuring this we're looking at consumer confidence we're looking at the University of Michigan consumer sentiment survey we're looking at the national federation of independent business uh optimism index and our very own leads business confidence index. All of these indices have come down and

[21:00] they've come down sharply over the last 3 months and it's really reflecting that uncertainty that's being um uh driven out of uh Washington uh right now. So drawing your attention to the consumer confidence index on the left, we see that uh the the topline consumer confidence number is the lowest since the pandemic. Uh but when we take a look at the expectations index which looks out further into the future, the index level is back to levels seen uh during the great financial crisis or just after the great financial crisis. When we take a look at the consumer sentiment survey, um it's really at the fourth lowest level of the last 45 years. And when consumers are asked about their inflation expectations, uh consumers are expecting the highest level of inflation uh 6 months or one year out than they have expected uh since the early 1980s. So that's that's a little troubling

[22:00] because if business if consumers are getting spooked, they can actually change behavior. And that's what we're g going to be watching very closely over the next several months is does uh reality match those expectations or do do consumers not not behave in the way that we expect them to? But if they do, if consumers pull back on spending, if they uh are buying fewer durable goods, if they're uh putting off that decision to buy a home or a vehicle or take a vacation, that has real economic consequences. So turning our attention to Colorado and Boulder. Um I I've said this before. I just want to reiterate this that we take a look at uh Colorado's ranking among the 50 states. And um I I I just want to call out that Colorado has been an outperforming economy nationally. So last time we presented we were showing the prior 15 years 2008 through 2023. We were a top five state for most of these

[23:01] metrics. We rolled that forward one more year and we're still a top performing state over the long term. So top five, top 10 by uh almost every important economic metric. And so I I think that's important context because when we take a look at the very short term, uh taking a look at current or or one-year changes, we see that Colorado has slipped in the rankings and by uh a large margin for some of these metrics. So real GDP growth, we're now 36th. employment growth, we're 46th. Um, and for personal income growth, we're 41st. But just because uh we're ranking lower doesn't necessarily mean that we're a slow growth state. So uh personal income growth for instance being 4%. Doesn't really speak to me as slow growth. It just demonstrates that we have outperformed for so long and other states were lagging. Now many of those states are playing catch-up. So they might be recording faster growth now,

[24:00] but they missed out on a lot of growth over the last 15 years. Other metrics though like the employment growth rate at 0.1%. I think these are metrics that we really need to stay attuned to because um if it is spelling some real hardship in the state and local economy, these are things that need our attention to try and mitigate some of those issues that could be uh holding back our potential growth. Colorado's employment growth. You um you can see a little bit of a a hook there on the very end uh in our three-month moving average. Um I will say that the the state labor office was reporting some data collection issues over the last year. And while they have fixed those, the National Labor Office has used a wedge to try and uh apply those revisions. So, while I think co Colorado as a state is recording slower employment growth, I don't think it's actually quite as slow as what's being reported. So, instead of 0.1% growth, it's probably a little bit

[25:02] stronger than that. And for the Boulder MSA, you can also see, but is now on the rise again. Um, like the nation, Colorado's labor force is at peak levels. Uh the last three months have been the highest three months ever for Colorado's labor force. Uh which is a really good sign on the labor supply front. Uh when we take a look at the worker shortage in the state, uh we've been talking for a while now about job openings exceeding the number of unemployed people. That ratio 1 during the peak in about 2022. Um but you can see how those two lines have been converging over the last uh 2 and a half years. And now our ratio statewide is one to one. We have one job opening for every unemployed person, which doesn't mean that it's an easy job market, but it means that it's getting easier. Um certainly it's it's uh it's hard to match workers with job openings

[26:00] based on location, skill, desired wages, uh child care, and so on. But it does demonstrate that the labor shortage issue is is easing a bit. So, our employment forecast that we presented in December was pointing to slower growth. We have since revised that down even further. So, statewide, what we're projecting now out of our base model is about 21,000 jobs added or 0.7% growth, which is a very slow growth for Colorado outside of a recession year. Um but I I put a little bit of a box plot on here so that you can see that there there are downside risks where um if the US were to enter a recession, we think that that could flow through the local economy and and um it it is uh plausible that we would see job loss. But there's also some upside risk here to where our model could be um sort of um over discounting some of the economic risks that we're anticipating in the economy right now.

[27:01] Um just a couple more slides here looking at national retail activity. Uh so thinking about that important piece of consumption especially in relation to your sales and use tax forecast. Um we we take a look first at the national retail sales data and the March number came in really strong. So it was 4.9% growth one and a half% month overmonth. It was certainly an acceleration. And um I'll I'll back up here and just uh call out that um you know prior to the pandemic the the national growth looks like it was pretty stable. Uh if we zoom in it's actually a much bumpier ride but um postcoid we saw a shift out in consumption and this was driven by a multitude of factors stimulus checks uh inflation and and so on. uh but now we've been on a a stable trajectory that really parallels where we were before the pi pandemic. This growth that happened in March uh was was partially

[28:01] driven by consumer behavior in anticipation of the tariffs and and the reason why I say that is uh we saw a run on uh on vehicles. Motor vehicle and parts dealers saw over 8% growth for the month of uh March, which we we haven't seen very often in our history. Uh furniture and home furnishing stores saw a surge in sales. And so I think this is a demonstration of behavior where people are trying to buy some of those big ticket items in anticipation of higher uh of higher prices. I think what that also means though is um they're pulling forward activity which should mean that we should see a little bit of a fall off in sales in future months. Uh so comparing the nation to Colorado and to the Boulder area. Uh this is a little bit of a messy chart, but what this is showing is percent change year-over-year in national retail sales in Colorado

[29:01] sales taxes and in Boulder sales taxes. Okay. And so what what you see here is these lines do not overlay each other perfectly. Uh but it is easy to to see a correlation here. And so when I take a look at a simple correlation, Colorado is correlated to national retail sales by um a factor of about.72 or so. And that's the same for Boulder. It's about 72 73. But Boulder is correlated to the state about 0.85. Um so that means that uh Boulder is not decoupled from the state and the state is not decoupled from the nation and that's really uh the root of our model but we bring in a lot of other economic and revenue data in order to uh forecast out u local area sales and use taxes. So how does this model work? We take a look at that national data. We study the Colorado economy and we study the Boulder economy. And um and so we've

[30:01] we've created these long-term um patterns where these uh looking at how Boulder uh Boulder's economy grows and revenue grows in relation to the state and the nation. And then we use a forecast from Moody's Analytics at the national level uh that has some national economic assumptions. And then Moody's also publishes optimistic and pessimistic scenarios where we can take a look at um how the economy may perform under uh better economic conditions and under worse economic conditions. And then we model this all out and see what it means for Boulders's uh sales taxes, use taxes, and uh property taxes. And um uh one thing I'll say about that modeling is that you know we we are taking a look at historical patterns but um uh you Boulder's economy you you you could sort of argue has unique risks in the current environment that we haven't necessarily seen in past

[31:03] uh economic data. Um uh and and what what I'm saying there is we've got the row of federal labs in Boulder. we have um the University of Colorado and the 700 plus million in federal funding. And so there's certainly risks uh in terms of the federal realignment. Um we're also though less exposed to uh the tariff environment to some extent because Colorado is not a a a um as as intensive of a trade state as many other states are directly. Uh but remember that a lot of the goods that we're importing to Colorado uh are are indirect imports where our companies and our residents are buying these goods from a company that's importing many of them from overseas. So the risks are there. They're just not quite as direct as you might think. So the the closing three slides just looking at the US economy. Um we used uh one one step down

[32:03] from Moody's baseline. It's called the S2 scenario and it has a probability uh a 75% probability that the economy could perform better and a 25% probability that it could perform worse. So I I say that because um when we were modeling this starting in late uh late March and early April um there were even greater uncertainties. It was before liberation day before the the the massive tariffs were announced. And so we looked at the Moody scenarios and we felt that S2 uh embodied our expectations for the economy better than Moody's baseline. So this is what the S2 scenario looks like at face value. Uh GDP growth at a very modest 0.8% for the year. Uh employment losses for the year. Personal income growth a little bit more muted than it has been. So that's a national economic context. Then we create the Colorado economy uh within this model and it's

[33:02] it's somewhat similar where retail trade slows to 1.2%. And under this uh more pessimistic scenario, we see slight job loss for the year. So uh distilling this down for uh my last slide here, what it means for the Boulder revenue forecast. Um and uh we we took a look at the the sales taxes and the the finance team ended up being a little bit more bearish than we were. They they looked at the medium forecast and the pessimistic forecast and they took the average of those for the sales taxes. And then um our use tax forecast, they actually took the average of the median forecast and the low forecast. Um, so what what uh growth of about one and a half percent in sales taxes and a little bit of a loss in use taxes for the year. And I think I need to check my alignment um because this uh this this total is

[34:01] incorrect. I think that's our old total. It says 3.7. Apologies for the error in the slide. Um but you know the the behavioral things that could impact this um if consumers ended up stocking up on some goods a little bit uh earlier in the year then we could still see a bump in sales taxes early on. If businesses ended up investing in that equipment um early this year, you could see a boost in use taxes in the first quarter and the second quarter, which would be a little bit counter to what you might expect, but then we expect that to fall off before the economy uh really takes off again. And uh that's the end of my presentation. Again, thank you to staff for your help on this. uh in the full report that we provide to city staff, we have the details for for all of the scenarios that we run and we also uh do the forecast not just by the totals for sales and use taxes, but we're

[35:01] forecasting it by component. So we look at a forecast for restaurants, a forecast for grocery, forecast for auto parts, and and so on. Um, so with that, I'll go ahead and stop and uh turn it over to you for questions. Brian, Rich, thank you guys. Really appreciate it. Um, yes. So, this will be a time for us to pause, ask them some questions uh about what we saw, and then we'll move into the staff presentation. And uh might I ask Brian and Rich as as tends to happen um when we get into the staff presentation, do you guys mind sticking around because I think sometimes questions pop in that that may actually end up being more in your wheelhouse a little bit further down the road and would just love your expertise in help fielding those questions as they uh pop up. Yeah, absolutely. Wonderful. Uh let's open up to questions. Um council, any questions? Ah, I see Tara. Go for it. And then Tina, um this is for Brian. Was I was I reading correctly or incorrectly that it doesn't look like that it doesn't look like 25 and 26 are

[36:01] going to be great years? Do you think that is what that last few those last few charts said or No, I I think what it it shows is um we were so last year wasn't a a great year for Boulder's revenue growth and uh we're showing pretty flat growth this year before things start to rebound uh for for Boulder sales and use taxes. That that's how I'm reading that. I I think that um we have to be attuned to the uncertainty right now. And so thinking back to COVID, thinking back to the financial crisis, thinking back to the the tech wreck back in 01, um that margin of error is higher on the than uh during more stable times. And so we have to be prepared for sort of shocks on the downside and shocks on the upside.

[37:01] And supporting Brian's comment, uh 2008 to 2023 were fantastic for the state. 220 uh 2024 was not. So it's consistent with what we're seeing here. Is that is that it for you? All right. Uh Tina and then Lauren. Yeah, I um just had a quick question about how we account for people who are working remotely but living in Boulder and how like there there might they might be working in areas that are have less optimistic or more optimistic outlooks um how do we with the new remote work trend? Fantastic question. Um the the the difficulty in in the data is we don't really know who is remote and who is not. Uh we we know that Boulder has historically had a large constituency of

[38:00] incomuters. um which which sort of interestingly I think buffers uh Boulder revenue a little bit from a a federal government realignment where if um we we we know that people tend to spend money close to home, right? And so if you have a lot of incomuters who are say working at federal labs and they're commuting 20 miles in 30 miles in um that that sort of spreads that that downside impact that negative impact out to the broader uh community so it's not just concentrated on Boulder. Um, but I think you know you uh you point out the opposite side of that where some people have made Boulder home uh by choice because they're they they can live and work anywhere. They're location neutral. And uh for for those people, there's one survey we can look at. It's called the

[39:02] it we refer to it as a household survey um that the labor department does and it's taking a look at employment and unemployment by place of residence not place of work. Um and so we have seen a rise in that unemployment in uh Boulder but it it's not um spiking to real concerning levels yet. Uh so I I I don't have a I I can't quantify what the impact is. I I can acknowledge that risk. Uh and the way that we can look at it is largely through unemployment. And then I have one other question that was great. Thank you. Um do we have any sense of the type of people who might be losing jobs in the next couple years? Um, and my end thought would be how to prepare to meet people's needs who might be have lower incomes and lower savings levels so that we can anticipate their needs in terms of food and shelter and

[40:01] all that and that's it for me. So I I'll start on this one and maybe Rich wants to follow it up. Um, you know, what what we've seen over the last year or so, year and a half, is is some softness in some of our tech industries, which is kind of interesting. We've already gone through a little bit of a cycle in Colorado, the slower growth cycle. And um uh we've seen some job losses in professional and business services which we often talk about as embodying things like research and development, software, uh design type work, architecture type work. And um and uh I I think at the national level when we take a look at that April jobs report, we actually saw a rebound in some of those jobs. So we we're going to get the April jobs report next week for the state and local area and we'll see if Colorado is following that. Um so if

[41:03] if we think at face value about um uh Boulder's federal footprint and if that actually comes to fruition where we see a lot of job losses uh federal job losses then uh we we look at those as as very highskilled jobs uh with a lot of educational training um they're high wage jobs and uh and so I I think for those people what's their next best opportunity and um you know Boulder does have still have a thriving tech community so maybe there's a place here uh for them. Uh but then I I think about the ripple effects through the economy. So if if we really do see some sort of downturn um it does have a ripple effect. So we we always talk about this multiplier effect uh on the upside but it works at the opposite too. So when when uh when we end up seeing a reduction in federal spending or a reduction in the tech

[42:01] environment that spills over to other jobs uh thinking thinking about grocery store jobs or auto dealership jobs, it it it really has an impact that reverberates throughout the economy. So I I don't think it's necessarily isolated to one industry or one income uh cohort. We we can think about what this would mean for the tourism industry. What does that mean for the restaurants? I I think we could tell a story about it impacting every industry to some extent or the other. I think what's unique about what we're talking about right now is it seems to be focused on a lot of those uh highskilled, high wage, um high educational attainment jobs. Can I call on that? Oh, sorry, Rich. Go ahead. I was just going to call up on ahead. Sorry. No, my my qu my my my colleague to Tina's point was when might we expect to see that borne out in the data? I mean, obviously there's going to be some lag and as things ripple. So,

[43:01] I'm just sort of curious like when would you be looking? I mean, we'll see jobs data, but when we see the economic impact, are we looking late summer, fall, like when would you start to see and be like, "Ah, that that's when the the wave hits." Yeah. So, it all of this takes longer than I than I expect it to, right? like uh these things are never immediate. What what we can see looking at the national data is uh federal employment dropped by 9,000 from February to March. Federal government employment dropped by 26,000 from January or sorry from from uh 9,000 from March to April, 26,000 from January to April. Um so we're starting to see it show up in the data. Um, anecdotally, we hear the stories in Boulder, but even what the university has put out shows that the impact on jobs uh at the university has has not been a very large magnitude yet. We've seen a loss in

[44:00] federal grants, but the people impacted is um is pretty muted so far. It's really impactful to the people who are impacted, right? To to the people who lose their jobs, but we're not talking about hundreds of jobs yet at the university. Uh so I I think it's slower than we expect. Um the the federal government severance helps because it's keeping people on the payroll for longer. And so I think we'll sort of see this sort of gradually take effect over the next several months. And I think that severance runs out in September or so. So I think that's when we we could see a little bit more of a cliff. Yeah. Thanks for that. I see Lauren uh and Mark, but I Ryan had his hand up for a minute. So I don't know if he somehow got booted out of that or his question got answered, but I just want to respect that I saw his hand for a minute, but let's go ahead and see. Go for Lauren.

[45:00] Thanks, Matt. Um and thanks for the presentation. My question was about um housing prices. You mentioned that um Colorado's housing prices haven't been increasing or in the last year didn't increase as fast as housing prices did across the nation. Previously, I remember that we'd been kind of unfortunately a leader in that category. And um I was interested in hearing your thoughts about maybe you know things that have been working to uh help mitigate that a little bit. Rich, you want to start on that one or I can. No, Brian, you passed me a tough one, but it is true. Our housing prices have doubled in the last 15 years. So, uh you know, we're sitting at a place of being in in a pretty deep hole. uh what's happened in the last year is great and and some of the policies have

[46:00] been supportive, but it it's still a very difficult environment. Yeah. a 15-year ranking for Colorado a year ago. So 08 through 2023. Uh Colorado measured the fastest home price compound annual growth rate over that 15-year period. And so I think that's a that's a demonstration of the uh pace of growth that we experienced here. So we had 6% growth uh count compound rate over that period which is uh really astounding that that's hard to sustain. Rich talked about it as a doubling. It was even a little bit more than a doubling. Um and now we we've fallen to sixth when we rolled that forward 20 uh what was that 09 through 2024. But sixth place was even a faster

[47:00] growth rate. I think it was 6.2% 2% or something. Um, but when we take a look at the one-year growth rate, we fell to 47th or so. Um, the growth rate now is between one and two and a half% depending on on the quarter. Uh, so it's a it's now a more normal rate of growth. We think of very long run home price growth before this boom happened as being somewhat in line with inflation. So we we used to measure it as about 3%. And that that sort of made sense. Um so even though our growth rate has come down to a normal rate of growth, the unaffordability shock has already hit. And so um it it's not much solace to somebody who's looking to buy into the housing market now to know that it's growing at 2%. they they're already having trouble, you know, entering the housing market outside of Boulder where homes average single family homes average, you know, 600 and in Boulder

[48:00] it's over a million. So, um there's a there's an attainability issue that's not going away. Uh on on the other side, we've seen rents uh actually decrease a little bit according to the apartment association of metro Denver data. And um and that's partially due to the huge wave of inventory that's been delivered over the last year and a half or two years. So I wouldn't expect rents to necessarily keep falling. Um but it's just a a ripe time because so so much product was delivered. Uh we'll probably see a shortage of product delivered in the near future which will lead to some higher rent growth. Thank you. That was it for my questions. Thanks Lauren. Uh let's go with Mark then Nicole. I just have a couple of questions. Uh first when you talk about the increase in housing prices, are you talking about market prices or cost to produce housing?

[49:01] Well, I I could argue both. Um, I mean, we we've certainly seen the market prices increase, and that's what's being measured in the Federal Housing Fin uh home price index. That's what's being measured in the Zillow home price index. If you want to look at that one, that's what's being measured in the apartment association of Metro Denver rents. on on the cost side of the ledger. Um not only have we seen the cost of land increase, but if we take a look at the producer price index for construction materials, we we saw huge price growth uh that that sort of was during the the same period as the consumer price index and the producer price index rose faster and peaked higher and stayed there longer than the CPI. So we were looking at at input price growth of over 20% that's sustained for over a year. Um we we have seen those input prices come back down.

[50:00] So I remember uh lumber being looked at a lot uh during that period in 2022 and 2023 and we've seen uh some of those inputs like lumber normalize uh but but um we haven't seen price decreases of 20% across the board that get us back to where we were. We shouldn't expect prices to go back to where they were. We're just operating at a new norm at a higher level now. Do do you agree with that or or do you have a different perspective on that? I assume you're not asking me, are you? Yeah, I was asking you. My answer is it's the cost on the marketplace at the end of the day. Yeah. I mean, so you know, Brian explained why it it shouldn't be higher, but it is higher. I mean, at the end of the day. So, and are are you expecting a continuing increase as a result of tariffs and do you have any sense of of

[51:01] how that would quantify? So, Brian's done some work in that area for the Association of General Contractors. I don't know if he wants to expand on that, but we are we are concerned. I mean, if lumber prices go up and other things go up. So yeah, I I I I'll give you a general response to that. Uh we we know lumber for instance is a major input to building and Canada's our major supplier for lumber. Now um there's been a little bit of a reprieve on uh tariffs with Canada, but um that's not something we can just domestically produce overnight. um even if if we have the will to uh clearcut some of our forests, a lot of the mills have been closed over the last 20 years. And so I I think it's hard to imagine an environment where we wouldn't see a sharp increase in lumber prices. And that's true when we take a look at

[52:00] the 25% terafon steel um and and think about the other inputs to building even if it's in the finishes like uh uh lighting canisters and and things of that nature. The these things are largely imported. Um and so if if we're expecting that to be domestically produced, it takes a while to ramp up our own domestic supply chain and what would be the cost of our own domestic supply chain. So, uh, the short answer is we we should expect higher building costs over the next year. Okay. One last question. And I know, uh, both of you gentlemen are are not in the, uh, position to predict the future, and if you did, you'd be very wealthy men. Um, but in terms of what you're looking at, is there a point in time that where you see that this might turn around a little bit and and uh conditions might ease or improve? And if so, what do you

[53:00] think might cause cause that? Well, I I think there was that initial shock and um not not the the best measure of the overall economy but a measure is the stock market and we we saw you know doubledigit declines in in the the uh equities and and that was from January 2nd to about midappril. I mean, we we saw decreases of over 20% in the NASDAQ and I think the Russell 2000 was also down over 20%. Um, the the market has has sort of recovered nicely. Um, uh, and so we we're seeing, you know, news of some deals being done on the the tariff front. So I think that um if some of this tariff discussion eases, we we saw the retaliatory tariffs paused for 90 days, the 10% is still in place, the

[54:02] 145% 44% is in place still with China. But um you know th those could be eased and those worries could go away. Consumption could flow again. Trade could flow again. Um, but I I think in the short run there's damage that's already been done. There's plenty of reports about factory production in China, about half empty container ships coming over from China. Uh, there's a lag effect, but that's going to hit our warehouses. It's going to hit our inventories. It's going to hit our shelves. So, um, I I think I think that we will see a negative impact. I think it could also loosen up depending on some of these policies, but that's only one policy that we're talking about so far. Um, that that's the tariff policy. The the president's budget, I think, puts a lot of risk um uh on places like Boulder with federal spending at at the labs and and with

[55:00] universities. So, I think there's more downside risk now than uh upside risk. Okay. Thank you. appreciate it from both of you. All right, my brief version of this is uh there's an election coming up on on the two-year term even though most of the prognosticators think that um we won't be able to or there will be no ability to turn the congressional balance. Uh I think the president needs to be aware of that and is engaged in that. So, I I put that on my sort of radar screen in terms of thing things that at least I'm watching and and as we go forward uh you know, not not countermanding uh Brian, but sort of actually supporting him. I you know I I think this is an

[56:02] interesting era for us as uh as a community and so on. Uh a lot of the things that we believe in and support and have gotten support for are things that are quote under attack at this moment in time. So we just need to pay a lot of attention to that and see where that leaves us at the end of the day. I believe the old Chinese proverb is may you live in interesting times and it's not meant as a compliment. So thank you. It's definitely not. Thanks Mark. Um let's let's do Nicole and hopefully we'll be done with this round of questions because we still got a staff presentation and then questions following that. So we'll just try to stay on track a little bit. Um but yeah, Nicole, why don't you finish off and then hopefully uh Rich and Brian can stick with us for a little bit. Go ahead, Nicole. Great. Thank you. Um and thanks uh Rich and Brian for being here. I'm just really glad we have you all to navigate the budget. Um, I just had a few questions as I was thinking about uh

[57:02] the local impacts. Um, one of them was just around which uh which industries have contributed to our state's outperforming economy and just thinking about whether those are industries we have more of or less of in Boulder compared to the rest of the state. Yeah. So I I I'll give you a couple of examples of industries that we watch as as critical drivers in the state's uh economy and and that has included the information sector, professional and business services, those those uh R&D type jobs that I was describing earlier. Um thinking about uh uh finance and real estate jobs. Um those are those have all been large and uh on a a strong growth trajectory over the last 15 years. Um manufacturing is not one of our key industries as a state where we we don't do a lot of manufacturing here. The the manufacturing that we do do tends to be uh food and beverage and tech. So

[58:00] thinking about um you know satellites and things of that nature. Um and so uh really all of that narrative is bolder right? So thinking about software jobs, research jobs, engineering jobs, and then the manufacturing satellites, uh food and beverage. Uh so I I think that's why Boulder has has been on such a strong economic run in conjunction with the state over the the last 15 years. And you know that that that may be Boulder's resiliency going forward is leaning on that private sector uh tech side uh to to continue to grow through you know a cycle where other industries are are trying to tug the economy down a little bit. Thank you. Um and then another question I had was um whether the regional employment forecasts um or whe whether you're using more regional employment forecasts in the local modeling. Um so

[59:01] just if some of those employment forecasts look the same in different areas of the state. We we do have uh regional employment forecasts, but um you know for for Colorado it's sort of interesting taking a look at the concentration of population and employment in our state. So about 85% of our population lives along the metropolitan front range from Fort Collins down to PBLO. And so the the rural areas outside of that band are a real minority. So even if we're modeling employment growth for, you know, just the Denver Boulder region, it ends up uh pretty similar to the state because that that's most of Colorado's population and most of Colorado's employment. Okay. Thank you. That makes a lot of sense. Um, and then I guess I'm kind of going to try to take us into a little bit of the uncharted territory conversation here, but um, so I'm I'm sure that you all are

[60:00] aware uh, American University released a brief last month that looked at the macroeconomics of um, cuts to research and they were finding u, for example, a 25% cut to public R&D spending would reduce GDP by an amount comparable to um, the decline that we saw during the Great Recession. And I was just wondering if you have any sense of what this type of impact might look like in a city that has so much public R&D spending. I mean, when you're looking at macroeconomic things like this, do you tend to see kind of fluctuations in the impact in more um in subsets of those groups? Well, we're generally supportive of that view. If you look at American universities and the contribution to R&D, it's been enormous. We're not talking about CU Boulder. We're talking about across the country. So, um, dismissing that as not a major contributor to success of the US

[61:01] economy, we view I view as as a real um shortcoming. That said, going to your question, I don't know if Brian wants to jump in, but obviously here we have an overshare in the sense of the labs and the university are very engaged in that. And so we're paying a lot of attention to the announcements from the university on budget cuts and and which contracts aren't getting funded, etc. Because I mean, that's a big player here. Yeah, totally agree. I we we we do quantify this. So, uh every year we do a study for the University of Colorado system and we do it by campus including the the Boulder campus and we even call out uh the R&D budget. So, we we break it down for sort of the education side and the the research side. And I I don't have that number top of mind, but we

[62:00] have it published on the site. I think the important thing to remember there is um if the university has, you know, a a million dollar grant or a $10 million grant or hund00 million grant and so on, um that that's really important to the local economy in terms of uh GDP, but it also a lot of the inputs to research are spread out. So equipment uh subcontracts people all of that they're coming in even from outside the region outside the state. So um we're not completely exposed when there's a a decrease. Uh but but that's just short-term spending. I personally I think the greater damage is to long run innovation and um that that's something that we've touted locally so much that partnership between uh the federal labs the university and the private sector in Boulder and and

[63:00] we're disrupting that and and you can sort of think about how that replicates across the US when we're not investing in uh R&D. So that that's my greater fear is the longer term impact on innovation. Thank you. Um and just two more questions. Um one was uh have we ever seen this level of federal funding cuts before? Um are we are we in uncharted territory? Rich, you've been around longer than I have. Have you seen it? I I don't recall this. I mean after World War II, we clearly had that kind of pull back because we had super invested in in the war effort, but generally speaking, this is not the norm. Uh so I I don't think we've seen it in the last, you know, 50 years, give or take, uh in terms of a pullback in federal funding. And we can

[64:00] argue whether it's appropriate or not appropriate, but you know, the impact is clearly still going to be there. So, uh, you know, we're we're focused on this, not just for Boulder, honestly, but for the state of Colorado. I mean, we're seeing or hearing the pull back in national park rangers at at, you know, and and so on. And those are important things for the rural areas of the state as well. Yeah, I'll I'll add just a little bit. Um, so we we have run such large deficits as a country and grown our debt as a country for so long. Um, that that you know perhaps some sort of correction in spending is warranted. Um, but whenever that happens or will happen, it'll be uh painful in the the short run. So, I I I think that's um that's something definitely to to be mindful of as well. Thank you. I wait, one thing

[65:02] I'll say on federal government uh jobs. Uh some of these jobs, just so you know, uh in the in the data, may not show up as federal jobs. A lot of these people can be federal contractors, so they actually appear as uh private sector jobs within the data. So, we'll clarify that as we sort of go through the months. And um uh for Colorado, this is just an interesting factoid. As we look back over the last 35 years, federal government employment has oscillated around 54,000. That's the average over that period of time and it's really stable except for during dennial census years when we hire a bunch of people to count people. Um but it it's pretty flat. Uh which means as Colorado's economy and Colorado's employment has doubled, uh federal government employment has become a smaller and smaller share of total employment in the state of Colorado. And right now over the last four years, it's oscillated

[66:01] around the lowest levels as a percentage of Colorado jobs. Um so I federal government hasn't ballooned in the state if you know if if some people are thinking that it hasn't been a large growth area. But as you highlighted, there's a lot of contractors. Yes. Yeah. Um, thank you. And then, uh, my last question, this is just I'm I want to make sure that I understand what you were saying. It sounded like, and I think in response to Mark's question, you were, um, thinking that, uh, things might be a little worse in the shorter term than they would in the longer term. Um but if I remember correctly, the model that you were using uh to project the um sales and use tax revenue had a higher probability of getting better than worse. And I just they seem a little bit contradictory. So I'm just wondering if you could explain because I think I'm missing something. Yeah. So they that was just a matter of timing mostly because we when we started modeling this it was back in March and

[67:02] so um the the Moody's macro model that we use uh we we felt at the time that their their baseline model which has a 50% probability of the economy performing better and a 50% worse. So it's truly sort of their their medium forecast. We felt it was too optimistic because uh information was coming out about um uh tariffs and reductions in spending. Uh so that's why we chose the more pessimistic model at the time. Um but if we were modeling this today, I would argue that the Moody's model has caught up to the current situation. So we would now use their their baseline which resembles the uh the pessimistic scenario from two months ago. Thank you. All my questions. Thanks, Nicole. Um, yeah. So, as mentioned, uh, Brian Rich, if you guys stick around a little bit, we're going to transition over to our staff um, uh, presentation. Um, but I will say that we we've we've used an hour up and we still

[68:00] have, uh, staff and then our follow-up questions. So, just mindful council on the staff side if we can try to be a little bit more abbreviated just so we can stay on track because we still have yet potential ballot measures. And one more thing, I know this is a meaty subject um and an important one for our community, but um let's try to uh get through this uh as we can. So staff, take it away. All you Charlotte. All right. Good evening, council members. I'm Charlotte Hesky, budget officer for the city. Uh good to be here with you all this evening to provide a financial forecast and budget update for our revised financial forecast for both sales and use tax and uh property tax. and we'll also speak to our 2026 budget direction, some of our key assumptions that we have as well as the efforts that we've been working on for the long-term financial strategy. So, I'll start with talking about our 2026 budget assumptions and our major forecasting considerations. So, we have mentioned as you just heard and seen the flattening of sales and use tax and property tax.

[69:00] These are our two major revenue sources for the organization at the city of Boulder. Um, I'll speak more to these in a bit. Um but we are forecasting flattened growth in the revised uh forecast that we have just been working on over the past several weeks um both for sales and use tax and for property tax. And so what that means for us as an organization is that we have limited uh ongoing revenues uh and revising down our uh revenue forecast. And I'll speak more to that uh on a on a few slides from now. Uh we're also considering and continuing to monitor federal uncertainty as it pertains to the city's budget. Uh in particular that we're looking at uh three particular items, federal awards, tariffs, and tax policy changes. Um I'll speak more to that in a bit. Um you uh all are familiar. We shared forward an overview of the work and the efforts that we have been performing as part of the long-term financial strategy uh back in April. uh and we are uh focusing on that as part

[70:01] of the ballot measures conversation tonight, but also within the 2026 budget development process, focusing on alternative revenue opportunities and thinking pathways for fee updates. And we also have planned community conversations on service levels that are to come between June and October as part of the fund our future effort within the long-term financial strategy. Given the amount of federal uncertainty and potential economic uncertainty and what we're seeing with the flattening of sales and use tax and property tax, we are continuing to focus in our budget guidance as Nuria shared earlier on uh this evening is focusing on realignments of programs, taking care of our existing assets and again focusing on flexibility across all of our city funds, across the organization, across our 41 budget funds. We're continuing to focus particularly in this time of heightened uncertainty on organizational resiliency and the work that we have done with budgeting for resilience and equity over the past three years as well as our work and efforts in the long-term financial

[71:01] strategy um and focusing on within budgeting for resilience and equity. The performance of our programs and looking at citywide alignment to the sustainability, equity, and resilience framework is all in in support of budgeting um and focusing on organizational resiliency. This next section I'll focus on our major forecasting consideration particularly thinking about the main items that we're considering for federal uncertainty as well as our revised revenue forecasts primarily focusing on our two uh uh major revenue sources for sales and use tax of property tax. There are three major items that we're thinking of and keeping an eye on for federal uncertainty. Some of the major considerations include tariffs. Um this includes looking at con consideration for cost of city capital infrastructure. Um looking at inflationary pressures as well as an impact on consumer and business confidence and what that might mean for our sales and use tax revenues. We're continuing to monitor across the

[72:01] organization the cost uh and potential price impacts uh of fleet replacements, equipment replacements, and technology replacements. Um, and I shared we shared forward in our staff memo, but there are some city capital projects that are more shielded from potential tariff impacts than others. And that's primarily in the transportation capital improvement program where they are uh abiding by uh with the federal uh awards with by by America provisions um and are more shielded um from impacts to tariffs uh with those uh provisions in place. The second item that we're looking at and considering related to federal uncertainty uh are our federal awards uh both direct and indirect. And we're continuing to monitor um our federal funds that we have uh at the city that are supporting existing projects and programs. Many of those fall in the transportation, affordable housing, and public safety space. We're also

[73:00] continuing to look at at future as well as pending federal awards uh that we have yet uh to execute. Um we have a total of 96.8 uh million active awards and of that total 54.3 is the remaining amount uh that we have yet to expend and then be be reimbursed uh after uh expenses. And to date, it's important to note we're continuing to monitor this, but no direct city federal award has been impacted. And the final item that we are continuing to monitor or tax policy changes as federal tax uh policy discussions are ongoing. The item in particular that we're looking at is the potential impact to our municipal tax exemption status, which if that were to be repealed or removed would result in a higher cost of borrowing for us at the at the city. Um an example here is that for a hundred million uh dollar issuance um the difference between taxexempt debt and taxable debt would be about $18

[74:02] million. We recognize as well that we have limited debt issuance plans in the current six-year capital improvement programs are somewhat shielded for this and we'll continue to look at this and continue to monitor this uh as we head into the 2026 uh capital improvement planning process. Um, and we've also been working and discussing with our financial adviserss and as of now there is a lower likelihood of potential impact for traditional municipal debt and we'll continue to monitor monitor that this throughout the 2026 budget development process. Shifting now to our major revenue sources of sales and use tax and property tax. sales and use tax. Uh the city of Boulder receives 43 cents of every retail tax dollar that's paid and collected in Boulder. This comprises of a a different categories of sales and use tax, including retail sales, business consumer use, construction use, motor vehicle use, and audit revenues. It is the largest source of revenue for

[75:01] the organization, comprising approximately 40% of city revenues and 50% when we exclude utility revenues. It's distributed across six funds, five of which are dedic dedicated, including the community culture resilience and safety tax, parks and recreation, transportation, open space and arts, culture and heritage. This table shows an overview of our actuals and our forecasted amounts from 2022 actuals through 24 actuals and our 2025 revised uh forecast uh that we are looking at. Uh the key note here and they're highlighted uh with the categories are retail sales, construction use and sales tax audit. And the main reason for these highlights is because retail sales um as we have seen is flattening uh since 2023 and again in 2024. Our revised forecast uh estimated 141 and we came in just below at 139. What helped to offset that is

[76:03] construction use and sales and use tax. And this is consistent w with what we've seen in our 2023 revenue uh actuals for sales and use tax as well as 2024. And so this blattening that we're continuing to see of our major revenue source is ongoing and of consideration for us uh as we move not only uh into the 2026 budget development cycle but also this revision that we have for our 2025 forecast. looking at our revised forecast uh that we have uh just recently updated in the past several weeks. Um Brian uh mentioned the heightened uncertainty and volatility and the wider confidence interval that we have within this forecast looking at the pessimistic and optimistic scenarios. The main and key note to to take in here is our original forecast is this top line in yellow. Our revised forecast is this bottom line uh in green. And what you can see for 2025

[77:02] and 2026 is that we've revised down uh our sales and use tax forecast for 2025 and 2026. And there's short-term considerations here um before uh uh uh moving upward uh in 2027. In particular, this revises down across all funds that receive sales and use tax uh by 5.8 million in 2025 and 5.1 million in 2026. And so we are continuing and planning on continuing to have uh continued conversations with our partners at CU as we head into the budget development cycle. Recognizing that uh the uh revised forecast for 2025 has been revised down. We're continuing to monitor our existing uh uh uh budget for the 2025 budget and recognizing that um we'll continue to uh monitor this forecast uh and receive an updated

[78:01] forecast ahead of our decision- making that we perform in July. Property tax is our second major revenue source for the organization. It comprises approximately 12 to 15% of annual city revenues. um out of for an average uh uh or excuse me for um uh the city of Boulder is 13% of the total mill levy for an average resident when we look across the total mill levy. It also includes Boulder Valley School District, the library district, Boulder County for example. Uh and for every dollar property tax collected, the city receives 13 cents. Um an example presented here is for 100 uh 100k in actual home value uh the city would receive 78 uh dollars in property and annual property taxes. Property values are reassessed every odd year. So we just received an update from uh Boulder County for the reassessments for

[79:00] 2025 to inform the 2026 budget. Uh and we also recognized and had shared forward with council last fall that state legislation has also uh put into place reduced growth for this other major revenue source that we have uh as an organization. So when we look at our property tax forecast and the recent data that we've received from Boulder County, what we can see is that we have flat actual value growth for the 2025 reassessment cycle. Again, this impacts uh our 2026 um projections. And so, in looking at this flat uh growth um for 2025 reassessment cycle, we have revised down our property tax projections by approximately 5.4 million in 2026 across all funds. Um what we can see in the data currently is that uh our actual value growth across all properties is at 2.5%. This is a particular uh uh or

[80:00] residential property which makes up the majority of our property classifications uh within the city had the lowest growth at 1.2% and again our residential property makes up about 81% of total actual values and historically we have seen an average of about 14.28 uh in in growth in reassessment cycles between 2013 and 2023. So this actual value growth um that we have seen is uh historic lows and looking back at recent history. The last time uh that we have uh seen this uh this level of of slow growth was was just after the housing crisis. The last piece uh that is impacting our property tax forecast for uh for 2026 is the legislative impact that just went into place last fall, last September after we published uh the 2020 uh 2025 uh budget. That was HB24B101

[81:00] um where it reduced actual value reductions to residential properties in 2025 and then continues to lower assessment rates applied across all property classifications in 2026 and moving forward. So, in shifting uh a bit and thinking now about our budget direction and development and our key assumptions as well as the efforts that we've been focused on for the long-term financial strategy given our heightened federal uncertainty as well as our revisions down and flattening of major revenue sources of sales and use tax. We are continuing to emphasize realignments of programs across the organization and that was guidance that we shared forward not only in March with the organization but again recently in light of our uh updated forecast. We're continuing to focus on alignment with the citywide strategic plan as well as uplifting council priorities and we're also focused on continuing to utilize uh community engagement input to help inform submittals as one of the key uh

[82:02] decision-making pillars that we have uh within the organization as part of decision- making for the 2026 uh budget. And then finally, our effort with the long-term financial strategy is continuing forward. We are asking departments as part of the 2026 budget development process for a two-year revenue plan to understand a pathway for potential revenue opportunities in 2026 and 2027. Uh as well as potential fee updates and understanding and recognizing that uh we have an ability to uh look at our cost recovery levels across the organization and other revenue opportunities. um for uh potential pathway for updates. One of the uh other items that we are asking as part of the 2026 budget development process is an inventory of all of our services and service levels across the organization to help inform our decision-making, not only with the 2026 budget, but also with the work that

[83:01] we're doing with the long-term financial strategy and the conversations that are to come with fund our future and uh the long-term financial strategy. So this graph shows our adopted budget growth uh focusing on the operating budget for the citywide operating which is the top line, the general fund budget uh which is this middle line and the general fund ongoing budget as the bottom line. What you can see and recognize in the budget growth that we've seen uh within this time period is the flattening of ongoing major revenue sources between 2021 and 2023 limiting our ongoing funding availability and between fund between 2023 and 2025. You can see an increase and widening between our general fund budget which comprises of one-time dollars and ongoing uh dollars. um between our general fund total budget and our general fund ongoing budget really demonstrating that increased investment in one-time spending given the current constraints

[84:01] that we have in our budget. So for the 2026 budget again we are uh highly focused and emphasizing realignments of programs given our revised forecast in particular as well as the current uh federal and potential uh economic uncertainty that we are facing. our six-year capital improvement program for 2026 to 2031. We recognize and we've shared this forward with council uh recently as part of the conversations with the long-term financial strategy that we have a backlog of capital infrastructure renovation replacement and maintenance projects. Uh we recognize that we have significant unfunded needs as an organization and we've also uh fully leveraged our community culture resilience and safety tax which has helped to support critical and key community projects like a renovation at the East Boulder Community Center as well as replacements uh and completion of fire stations 2, three, and four. Um

[85:00] we have aging city infrastructure as well as emergency maintenance needs. And we recognize that continuing to to fund emergency maintenance needs and in lie of looking across our uh portfolio holistically is an inefficient use of funds. And that's why we're continuing to focus on looking at our uh building portfolio, our existing assets portfolio, and taking care of our existing assets and continuing to prioritize funding for existing and future capital infrastructure maintenance needs within the upcoming six-year CIP. in the work that we're doing with the long-term financial strategy and fund our future uh we shared forward with c with council just a month ago. The development the long-term financial strategy focuses on the development of a comprehensive citywide strategy to help guide fiscal decision-making and long-term financial health of the city. It uplifts the guiding principles and focusing on revenue sufficiency for the organization, flexibility of our funding

[86:00] as well as diversity of our funding. Recognizing that we have an over reliance on sales and use tax um in the organization, we're also focused in our guiding principles of predictability of our service levels. As part of the work for the long-term financial strategy, this work is well underway, our multi-year ballot measure strategy framework that we uh put together and also presented to council back uh in April and focused on 2025 potential tax me ballot measures as well as 2026. and we'll focus on uh that in the next item and conversation to come. And then finally, fund our future community conversations uh are part of this effort that we're planning between June and October of this year where we intend to talk with community members about service level priorities as well as our unfunded needs. share background on our current financial constraints and utilize this information to help inform not only the the uh 2026 budget but also the 2026 potential tax ballot measures

[87:02] as part of the multi-year ballot measure strategy. So, rounding us out uh in looking at our budget direction and key considerations, uh we are focused on flexibility across all of our uh city funds, really emphasizing realignments of programs given the heightened federal uncertainty, our slowing growth of our major revenue sources for sales and use tax and property tax. um focusing on outcomes and performance measures and the performance of our programs and services to support these realignments that will occur within the budget. and continuing to uplift and align with the citywide strategic plan, utilizing these pillars of decision-making with city council priorities and community engagement, and continuing to work on our efforts with the long-term financial strategy, particularly focus on ballot measures this year, alternative funding opportunities and service level conversations with community that are to

[88:01] come. Finally, our budget development calendar. Uh we are here May 8th with this financial forecast in 2026 budget update. In June we have a update uh and sharing forward with uh the financial strategy committee and also have final budget decisions that are due um from departments across the organization at the end of June. July we'll focus on 2026 budget decision making. We'll also perform a final review of our revenues forecast uh to help inform the decision- makingaking not only for 2026 but also in potential consideration for 2025 as well, our current fiscal year. Uh August 29th is when we will share forward the 2026 recommended budget and that will be released publicly as well as to city council. uh and September 11th is when we'll have our city council study session on the 2026 recommended budget. And then finally uh October 9th through

[89:02] uh the 23rd uh is our uh 2026 budget council readings and adoptions. The last item to just uh emphasize and note on here is that from June through October of this year, we are focused on fun uh future community conversations. And so throughout this budget development calendar, we are also weaving in these community conversations that are to come on service level service levels as well as our financial constraints. So, the two council questions that we have for you all this evening is if council has any questions regarding the 2024 preliminary unodudited year-end financial results uh and whether council has any questions regarding the 2026 budget uh economic outlook as well as key uh budget assumptions. Wonderful. Thanks, Charlotte. Um really appreciate uh the info. uh you moved through that rather efficiently.

[90:01] Appreciate that. Um not not a great look, that's for sure. Um no one likes to see that picture painted in front of us. Um but let's open it up for questions. Uh being mindful also that we're already 90 minutes into this piece, which was what we had budgeted in time. Um again, important for us to discuss. So if we can try to be brief in our questions, um that would be helpful so we can move on to the other items. Um I see Nura's hand up, so go ahead. I was just going to be mindful since we still have guests that if you do have questions for Brian and Rich uh based on this presentation, we might want to get those out of the way as well to let them go. Thank you, Nuria. That was where I was headed next. So, I appreciate like minds, Matt. What Whatever they say about like minds, who knows? Um so, uh anyway, I see Mark and then Tara, take it away. Well, uh, that was pretty cheery. I I feel much better now.

[91:01] Um, I thought it was a very thoughtful presentation. I have only a couple of questions. Um, have you identified the uh realignments you wish to propose andor the cuts in expenditures you wish to propose? and if if so or if not uh when would you uh like to discuss those with us? Thanks for the question, council member. So, as part of the work that we are planning on performing with the 2026 budget development process, we uh are continuing to look at the forecast. Um we are uh as I shared forward earlier going to be continuing to uh monitor uh the uh the uh sales and use tax forecast in particular um with our partners at CU um over the next over the coming months. We're intending to receive a revised

[92:01] forecast uh to help uh understand whether or not we deviate from what our current forecast is. Um and that will help us to inform our budget decision making that is in July. Um we will be uh providing uh uh an update um and sharing an update uh with the financial strategy committee that we have planned for uh June um with the information that we know at that time knowing that items uh and the forecast can continue to change. Um, but we are uh uh planning on um uh utilizing the information, continuing to monitor to help inform our decision-m that's planned for the July uh August time period. Okay. Thank you. And my my second question is and last um have you considered fees for certain kinds of activities that that we now almost take for granted as being

[93:01] free? Thank you for the the question. As part of the work that we're doing within the budget uh process for 2026, as well as the work that we're doing with the long-term financial strategy, we are looking at revenue opportunities across the board. That is uh as as as you all are familiar, looking at ballot measures in addition to looking at fees. Uh and so as part of the the work that we're doing, we do have uh uh uh revenue submissions uh and revenue plans that will be submitted uh by departments and recognize that there are updates that we can make to existing fees as well as potential implementation of new fees. So that is that is part of the the look that we are doing within uh the work both with the long-term financial strategy and the 2026 budget. Thank you, Charlotte. And now I'm going to commence drinking heavily, but that's the end of my questions. Oh, I love you, Mark. Um, uh, Tara, then

[94:02] Tina. Okay, I just have two questions. The first one has to do with the revised forecast slide. Um, why does the revised forecast get closer to the original forecast when we get to 2028 and 2029? Is that just because you don't know? And so you're going to leave it like that until you do know or is there another reason? Hoping for the best? What? Yeah, I'm I'm happy since we've got our partners at CU uh on board. I'm happy to toss it to Brian if you're interested in in sharing information. If not, I can share what we discussed, but thought you'd come off mute. Sure. Uh that's a an astute observation. Um so we when we use Moody's alternative scenarios the the optimistic and pessimistic scenarios are all um are are really differentiating in the short run. So that if you take a look at all of our forecasts there's there's

[95:01] variance in the short run and then they start to converge in the the longer run. And so, um, as we've looked at this over time, what what we find is, uh, there's an assumption there that slower growth in the short run, uh, gets made up for with stronger growth in the long run. So, we we'll sort of see that over time where if we're looking eight or nine years out, there's sort of a convergence. Uh, so that the the noise is all in the next, you know, two to three years. Um, I I I I don't know if that's a the a great answer, but but that's mechanically how that ends up working out that far out. Well, I thought as a pessimist that I was all of a sudden going to become an optimist. So, that's kind of made me a little bit down. But I I I will say that that is what we observe over time is that um even you know, so we we go through recessions. We we saw this in uh in 07 07 89 and then

[96:02] uh following that and then we saw this after the COVID uh pandemic that we we do go through this shock and then we do actually have faster growth rates that follow that. So we're making up for it. But when you you sum up the revenue over the entire period, that seven-year period, you never make up for what you lost in the short run. So even if your growth rate catches back up, you still have this gap in your total summation of funding because you lost it. I mean, it just never happened. Great. So I can stay a pessimist. Awesome. Sure. Yeah. Okay. Okay. My second question is me making believe I'm a community member even though I am a community member but speaking instead of a council member. Why if we are on a constrained budget did the budget go up to 399 million? Why wouldn't we have kept it the same as what I would ask if I was

[97:02] not? Yeah. So one of the uh items that you can see uh is that increase to 3.99. And one of the things that we like to share forward and remind uh in terms of the increase for the 2025 budget is that when we exclude planned debt service as well as uh internal service charges, so items like our fleet replacements and equipment replacements and technology replacements, we only grew 1.3%. So that 6.7% year-over-year is really associated with planned debt service as well as internal service charges. Uh the growth is even lower if we look at the general fund though specifically. Yeah, I did see that. Thank you for that explan explanation. Thank you Dana Nicole. Yep. Um I have one qu uh two questions and the first question is um when we do the realignment and look

[98:02] at the services and the different ways we're providing services in a community, will we also be including the grant funding we extend um which is over $5 million and thinking about whether we're duplicating those services and um and sort of as a follow on We are trying to get to outcomes. We still trend a little bit toward activity because we're new in this process, but could we attach actual outcomes to the grant that we're extending as well? Couldn't come off mute. Um, thank you for the question, council member. So as part of the work that we are doing and looking at uh all of our programs across the organization as well as our services is also looking at grant um funded services. So we recognize that we've got uh uh grants that we've received in in ARPA funding that are expiring um after

[99:02] 2026. Um uh we recognize that we have federal other federal grants as well as uh state grants that we receive. Um and those grant dollars may be drying up. We certainly know that the ARPA funding is not going to be extending past 2026. And so that is part of the work that we're doing uh in the holistic uh view of realignments um for the organization for the 2026 budget, but also in consideration for the 2027 budget looking forward as well. And I I should have been clear, I'm thinking about the grants that we're extending to organizations. So, we're extending grants to about 161 agencies in the city through the human uh resource fund and the health equity fund and to a much much smaller um extent to the human relations fund. I would say and I don't know Charlotte how much you want to talk

[100:00] about but it's part of the work too. We're looking at um sort of formalizing a little bit some of the grant process, centralizing some of those procedures, um putting some more rigor because there's a lot of grant processes across the city and thinking about um some of the criteria and some of the um making more consistent reporting requirements and um the mechanisms by which grants are funded. So, we're going to be looking at all of that throughout um some of this uh budget process and next year's budget process. And I know the finance uh budget team has been looking at some of that. Okay. And and and just kind of where I'm headed with this is similar to my prior question. Um is is more about our needs might change in our community and the grants are sometimes a little bit more nimble. um and and might we might want to think about it differently because we extended grants in a certain way with a certain set of conditions that might drastically change in a year. Um, and I'm also particularly

[101:01] interested after our meeting with BBSD last night about how we're thinking about giving money to the school district and whether we do that in conjunction with their governance model that's much closer to their work than we are. Um, or whether we continue to do grants through our granting group. Um, so that's kind of something that's been on my mind as well because there there are a number of grants going to BBSD or BBSD students through other agencies. um particularly with the health equity fund. I I appreciate and love the question and I think the inventory that Charlotte and Charlotte apologize if I'm jumping in and stepping on your toes. Um the the work that your team has started doing already of taking an inventory of who all in the city is involved in uh the granting process because sometimes it's not just city staff. Sometimes frankly council has vested that in uh in in other entities. some of the boards and commissions are involved in um

[102:01] granting and whatnot. So, we have done an inventory, we've begun that inventory, started that and so looking at what does that look like um and making sure that we're able to um appropriately categorize and make sure all the criteria um is known so that we can actually um refine and or make recommendations if the case need to be made to council to think about that. And so we are in the process of all of that. Am I getting any of that wrong, Charlotte, that you need to pull me back? No. No. Um, and then my second question is really following up with what Tara was asking about. It feels that the sale and use tax projection for 2627 is also increased. And I'm is that accurate or am I reading it incorrectly? uh when we compare it to our original forecast that we currently we we currently had uh for our approved budget and then we revised down we've revised

[103:02] we've revised uh our sales and use tax forecast down for 2025 and 2026. Those are the most uh impacted years. Um it is also revised down in the out years though um that you can see from 2027 through 2031. So there is a revision down from our original sales and use tax forecast to the now updated revised forecast. And that is something that we're going to continue to look at and monitor and update if we need to make any changes recognizing that there is federal uh uncertainty. And so it might be uh shifting down and it might be shifting up just given the amount of uh the wider confidence interval that we're dealing with with the amount of uncertainty that we're in. But but from 25 to 26 and 26 to 27, we're still looking at an increase in revenue from sales and use tax. Is that correct? We don't see it. We're not forecasting it

[104:01] at zero or a plateau for the 2025 uh sales and use tax forecast compared to 2024 we are projecting flat growth flat and then the year after we and then the year after it increases uh after that. Yeah. Okay. because I Yeah, I was just surprised to see the increase because we're seeing such a plateau trend, but I do hope it's it pans out for sure. Thank you. That's all I have. Thanks, Tina. Nicole, thanks. Um, and thanks for the presentation, Charlotte. Uh, my question is just for staff, Matt. So, if anybody has any questions for Rich or Brian, they're welcome to go before. Thanks for flagging that. I don't see any hands. Last call for questions for our friends at CU. Going once, going twice. Brian and Rich, thank you so much. Have a

[105:01] wonderful evening and a great weekend. Enjoy the weather. Uh, thanks Nicole for priming that so we can let them go. Appreciate that. Yep. Thank you. Um, so just thinking about especially our resilience and equity components of the framework. Um, is there any are there any conversations about keeping some undedicated money aside for any potential increases? Um, I'm thinking especially in areas like um basic needs for lower income community members, for example, if we do start seeing cuts to critical programs like Medicaid and Medicare, rental assistance through HUD and and that sort of thing. Are we at this stage kind of thinking about that as being a a priority outcome in itself of just trying to to keep some money short up? Uh thanks for the the question, council member. I I I think one of the items that I shared uh as part of the budget direction and guidance that we shared with the the organization is that we're

[106:00] going to be taking a hard look at realignments of programs across the budget um this year recognizing the uh pillars that we have for decision-m recognizing our sustainability, equity, and resilience framework and the needs of the community. um and that the engagement and input that we've received from community members over the past few years and the work that we've done with the community connectors and residents. And so we are looking at all of that holistically as part of the 2026 budget development process recognizing that there are unfunded needs as well as potential future um unfunded needs as you're you're saying with uh potential impacts for um uh federal funding but also other potential economic impacts as well. Thank you. Um and is it fair to say that the approach that we're using now um versus the one we were using say three or four years ago uh is much better able to adapt on the fly if needed um than

[107:02] what we had before. Yeah. I one of the uh key pieces that uh the organization has been working on for the past three years is the work with uh budgeting for resilience and equity as well as the work with the long-term financial strategy. and we've been sharing forward with uh with you and city council and community members the constrained budgeting environment that we have been budgeting in. And so we recognize that we've got a framework and organizational resiliency built up um to be able to support these conversations coming forward. Well, thank you. And I just just want to take one minute, Matt, to lift up this work that you all have been doing over the last three or four years. It really I mean it it you know I wish that it had we've been even farther along at this point and if we had not been here at this moment um I think we would be in a lot more trouble. So I would just like to thank you um Charlotte Joel Maria um

[108:01] Christa I know you're just arriving but just thank you to all of you who've been pushing this forward. It it is um I just I I can't imagine not having this at this moment. We are in so much better shape because of everything you've done. So, thank you. Thanks, Nicole. Tina, I still see a hand up. Is that a ghost hand? All right. Um I my I I just have one question then we can move on. Mine and maybe centers around some of this realignment issue which is you know at what point are we going to start having an internal and really external conversation with community about levels of service and those particular areas or departments and their level of funding and trying to seek balance. Um I I I there's probably issues where the level of service is higher than the funding is available to meet and we need to talk about that. There's probably areas where the funding in many ways is higher than

[109:02] the true level of service. And so how do we recalibrate that? Um and so I'm just wondering when those conversations happen. I think that somewhat has to do with maybe some of our dedicated funds, but I'm just curious when that happens because that that's the whole bag. That's the whole enchilada. The the expected service now is not what it was 20 years ago or in many cases when many of these taxes were put in place. So, I'm just wondering when do we get to sort of level set and reset what that community expectation is with levels of service from various programs and departments? When do we really get to that meat and potatoes? Because I I I just I don't I I think some of this is just trimming around the edges until we really get to some of the meat. Um when we're dealing with, you know, hundreds of millions of dollars. Yeah. Appreciate the the question, council members. So, this is truly part of the work and the effort that we are planning for the fund our future conversation as part of the long-term financial strategy. As part of the work that we're doing with the 2026 budget, we're asking all departments to send forward a list of services and

[110:01] service levels, benchmarking data. We're also performing benchmarking analysis. And that information will be critical to help the conversations that are to come with community members as part of fund our future. and that's planned to take place from June through October of this year. And so that is really the work that is to come. Um we will be involving you all in that work. Um and the the first conversation that's related to that is upcoming on the June 12th community and council forum. Um but really that focus uh is within the the conversations to come with fund our future from July and October of this year. I I just wanted to double down on the point you're making and Charlotte, you said it precisely with the timing, but it's there is nothing more important, council member, than this conversation. And I I want to thank the members of the financial strategies committee because they know it. They've been helping us uh do some of this work, departments who have been gathering that information. Um it is pastime that we

[111:01] have this conversation about service levels um and about what is really important to community because we have to talk about uh the pool of financial resources that we have and the desired level of services of all kinds that community wants from us and we cannot they do not match right so we have to talk about that really candidly and really openly polling is going to be helping as we think about that moving forward. Um, and this uh forum will be helpful as we do that. But there is no more to me critical conversation than the one we're about to have um about our financial state, the the appetite for um what we will fund uh what's critical to our community and what we're able to fund quite frankly. Appreciate that. Um and just a final little piece I'm curious just from a narrative perspective. it see this this comes through as perhaps a revenue problem and

[112:03] I and I just and so I just I just think it comes off that way. So just to sort of balance that out I think is is is maybe helpful on how that that's received. But I I I'll stop there and just sort of pose to um Charlotte and staff you've posed your questions. Do you feel like you know gotten a good number of questions feel like we sort of nibbled around this uh quite substantially? You know there wasn't any clear asks so but I just want to make sure feel like we got through that. Yes. Fantastic. Wonderful. Well, again, um really appreciate Charlotte, uh Christa, welcome to the welcome to the team or the family. Um and Joel, thank you for all your great work on on this stuff and really trying to shepherd us through some really difficult conversations and they're likely going to get more difficult as we really um lift lift back the curtain on a lot of this stuff. So, thank you all so so much. Um, and I'm sure more questions will pop up and you'll see them in hotline or other uh emails to you and community. Um, all right. So, let me turn it back over to Nuria as we move on

[113:01] to our next subject of potential ballot items. Indeed. And I know that we've got a tight schedule, but there are times and years in which uh we have very few on the ballot and this is not one of those years. We had a lot going on. Uh, and there is no one uh better suited to sort of help us manage that than our own city clerk. So, Miss Alicia Johnson, take us away and maneuver us through this item. All right. Thank you, Nuria, for as always a gracious introduction. Good evening, council. Elicia Johnson, serving you as your city clerk and your city's election official. Um, tonight we will present to you the 2025 potential ballot measures for the November 4th, 2025 municipal election. I would also like to take this opportunity to thank the members you see on the screen um if my slides are up. I'm not sure if they are. Oh, thanks Emily. Um, on the screen for their dedicated and thoughtful work

[114:02] with putting this information together for us to present to you tonight. And I also want to acknowledge coun uh mayor pro Tim Folks and W and Wallik who worked with us on the charter committee and also council member Spears Shuhard and Wallik who served on the financial strategies committee. Next slide Emily. So our agenda tonight um will be we'll go through the charter review committee recommendations and that will be presented by our deputy city manager Chris Mchek. We next will move to Charlotte's double take um to give you information on the financial strategy committee recommendations. Um we'll have John Moors take on items three and four which is the city petitions update and the potential ballot measures for the state and region. And then I'll wrap us up with next steps. Uh we do have our city attorneys here as well, Louisis Toro, um

[115:00] here to uh answer any legal questions that you may have. So, at this moment, I'll go ahead and turn it over to Chris to review the charter review committee recommendations. Thanks, Alicia. Good evening, council. Chris Meschuk, deputy city manager. Uh, I'm going to uh give the overview of the charter committee recommendations. So, if we go to the next slide, please apologies. Uh, the charter committee met and discussed multiple potential ballot measures. In the end, the committee is recommending one ballot measure to be considered by council, which is an amendment to charter section 130 um related to boards and commissions. And uh th this may sound familiar. This was a ballot measure that uh we brought forward in 2024 that did not pass. Um and uh this was a a recommendation coming out of the boards and commissions assessment. Uh and if you'll recall last week, uh Pam presented about the boards and commissions program uh and we talked

[116:01] about that, uh flexibility on terms and criteria are, um limited right now based on the language in charter section 130. And uh what the committee really talked about was um sharing a little bit of what they believe was the concern from from community members and why it may not have passed was really around um the the language on removal. And the committee asked us to look at could we bring forward a ballot measure to amend charter section 130 to achieve the recommendations of the boards and commissions assessment um without changing the removal procedures that are currently in the charter. staff believes that is something that is possible and so the committee uh brought forward for us to consider uh and for council to consider um bringing this forward as a 2025 ballot measure in a modified form. So that's it on uh on that piece. We did want to on the next slide um just highlight uh there were some other uh

[117:02] ideas that the charter committee discussed which were uh as we did some research not charter changes so they weren't considered further by the committee. We included this information in your memo and we're happy to answer any questions. The first was around fiscal notes on ballot measures. the second on dedicated funds to be allowed to be used for general purposes in emergencies and then uh renter protections. So happy to answer questions on those if uh if council members have them. Uh but with that we'll go to the next slide which is our first question for council which is we're looking for uh council feedback on whether you wish to proceed with us working on drafting a proposed amendment to charter section 130 for you to consider for the ballot. Thank you so much, Chris. Um, and man, just like lightning speed. Um, we got our questions in the chat. So, uh, those are there for you to reference as well. All right, I see Mark Mentina, take it

[118:00] away. Uh, just just one question. Um, are we going to poll on Excuse me. Are we gonna poll on this as we poll on uh revenue matters? That's a great question, Mark. Um, we were not intending to poll uh on this potential ballot measure. Uh, the the polling that we were looking at was really related to the the potential tax measures. I I mentioned it because the the margin of defeat was 65 votes uh out of 46,000 cast. Um, that is 0.0014%. And it it leads me to wonder whether a the mood of the public may have changed a little bit uh or b it's worthwhile to find out what the defect was and and proceed from there. That was that was my question.

[119:00] And if anybody wants to answer it, I could answer it, but I don't know if I'm allowed. Okay. Well, that it's an interesting question with no answer. Uh Chris, do you have a I'm just I think Mark deserves some response. Yeah, I I think uh what Mark pointed out is a really good point, which is that that you know, the margin of defeat on that ballot measure was very small. Uh, and what uh what I heard from uh from some of the charter committee conversation was that what what council members or folks had heard in the community was that the concern was really around amendment of uh the removal procedures. I I I don't obviously know that and it would really be I think a it's a it's a policy question ultimately in the end uh on uh on m maybe why the the community ultimately chose or the majority chose

[120:00] not to uh to support the amendment and I I supported advancing this uh amended um proposition. Uh but that was before I actually went back and and looked at the the margin of defeat, which leads me to wonder uh if it's at least worthwhile doing a a a polling question to determine if if in fact the amendment is necessary in its current form versus running back the original form of the uh proposition. that if you want to comment on fine but that's my only real question here. All right comment on it or should I not? Well, let let's let's maybe comment on other pieces. I think the question is should there be polling? And I don't know if that's a I don't know h how we answer that. I think that maybe goes back to our charter and elections

[121:00] committee to some extent um and on this issue on whether or not that's something that that wants to be suggested um because this is a charter uh suggested charter change. So I think that might be a suggestion that maybe would want to come from the committee uh to council if that's something we want to pursue. Um all right, Tina, Tara, go for it. Yeah, just a quick process question. Are we going to do a straw poll on this or are we each individually going to say whether we want to continue and look at this at the next round? That's a great question. Um I I think we were starting with do we have any questions uh about it? Um and and then if we get once we are done with questions we're going to circle back and be like all right so do we want to move forth or not? Um so we are in that question phase. Um if you want to say your question and say I like it or I don't like it that that sort of accounts too but at the end we will straw poll for absolute clarity on uh on this particular question for the uh section 130 uh charter change. Okay. I don't

[122:00] have any questions and hope staff decides whether or not to pull. I'm okay with that and um I look forward to the straw poll. Tara, well I didn't have a question. I was going to say why I think we should do it. Is that not now that I should say that? I just paused with questions. So maybe let's reset hands and be like, does anyone have any questions? All right, Nicole has a question, then we'll get to the straw poll. Nicole, take it away. I have a question and one very little comment at the end, so I can I can wait till Tara does her comment, too. Um, but I I just I'm trying to uh adjust my memory. The reasons for the term length changes um that we were proposing were to enable a council at some point in the future to consider adjusting term lengths for boards and commissioners, right? Where the five-year term length seemed to be a barrier to participation. So again, this is not anything that would change the term length through this ballot measure, right? That's correct. that the the current

[123:02] charter language is that it's kind of set for any board and commission and for any member that it's a five-year term uh as well as um uh requirements for uh age and and things like that. And so um the idea of the charter amendment would be that it would create flexibility for council by ordinance to then um set those um by board and commission. So, um, different boards and commissions, you could set different lengths or term lengths, or you could have certain seats that have have different term lengths or, uh, or age requirements or things like that, but it would require future action by council by ordinance in order to enact that board by board. And that would require a public hearing, right? Correct. Board by board. And there, if I'm remembering, there were some boards that this wouldn't apply to. Can you remind me which those are? There there are uh a couple of the boards that are not considered uh a board or commission

[124:00] per um the charter language. Um the the police oversight panel is one of those. Um that is kind of the the most notable that people usually bring up. Well, the police oversight panel is now no longer a boarding commission. Correct. It wasn't because I was like was planning board one of them or I feel like there were some that were off that this change wasn't going to apply to at all even if we tried to do an ordinance. I appreciate that Nicole and uh I see I see Teresa. Y she's on her phone unfortunately. Yeah. Um but thanks for the the correction. I think uh I misunderstood your question and there are some and Teresa if you want to chime in uh with that or uh if being on the phone is tricky happy to to support as well and it looks like you are muted as well. H thank you sorry I'm having internet issues. Um I think that what the council member is referring to are those boards that are enshrined in the charter. And

[125:03] so, um, there are, if I recall, I believe there are four of them. Um, OSBT is one. I'm not recalling all of them off the top of my head. That's correct. I think it's OSBT, Planning Board, um, Parks and Recck Advisory Board, and there is one other that, uh, will come to me here in a minute or somebody may remember. Uh, yeah, RAB. I think Lauren's right. I think RAB. Okay, cool. Thank you. And those would have to it would have to be another ballot measure some point in the future if those term lengths ever wanted to change just specific to those. Okay. Thank you. Correct. Um and Matt, I can let Tara go with her comments and then I'm I've got just a quick Well, I had a question and then we'll circle back to taking a quick straw poll. Um my my question centers around one of the slides that talks about three other potential recommendations, but that they sort of that since they don't require charter changes, they just sort of were not

[126:00] considered further. And I wanted to know how would you sta this a question for staff or maybe those comm you suggest us consider those items. I I I'll speak candidly like the fiscal note is something I'm very interested in and I'm also very interested in the renter protections that is similar to the Tacoma for all initiative. So I'm just sort of wondering what then what would be the next step there for those? um is it does that need to roll to next year or is is there another process that needs or group that needs to grab those to to elevate them? So, I was just sort of curious what the what what what do we do with those that there may be uh council interest in pursuing either now or or or soon after. Yeah, the charter committee is uh constituted just to look at charter changes. Um, so, uh, when we looked at those items and saw that they would not be charter changes, um, that's why the charter committee did not consider those further, but we included them in your memo here. So, we're happy to answer any questions that you might have on them.

[127:00] Um, okay. So, from a process perspective, um, why don't we start with the section 130 since that's the direct ask, and then I'll circle back to council to see if there's actual interest in any of those other three and then maybe there's some direction that comes out of that and maybe not. But I I do do think those deserve uh some time to shine and have some vetting in one form or the other. Um hope that's okay uh with with staff on that one. Um but let's go ahead and see. Um I don't know if there are any comments to start, but I I'm okay if we just start with a show of hands. Who's interested in uh moving forward the recommended charter change for section 130 regarding boards and commissions? So if I can just see a show of hands. One, two, three, four, six. All right. I don't Ryan's camera's off. I mean, we've got enough, but if he wants to be on record for a straw poll, I see him trying. Yeah. Yeah, there he is. All right, we got you, Ryan. Perfect. Um All right. Um so, so

[128:00] that's some clear guidance there on moving forward with that one. And uh Nicole, I see your hand. Go for it. Yeah, I just um wanted to mention something that was mentioned before was about uh the possibility of polling for this question. And I just want to say I think this would be um it could potentially be interesting to see if the original one might might be of interest this year, but also um I don't want that to interfere with the polling that we're doing on the tax measures and the spending priorities because in my mind that's a priority one. Um but if there is space, I think it's something I also would be really interested in uh because I actually liked our ballot measure last year too. So thank you. Great, great point, Nicole. I I actually agree with you. I don't want too much noise on the polling or polling fatigue. Um so that's a fair point. uh to bring up. Um so if you don't mind ju just because it it's sort of outside the scope of the committee, but they have been floated. I think there's at least there's got to be at least a couple people otherwise they wouldn't be on a slide that are interested. And so I just want us uh maybe do a quick straw poll on if council is just interested in us moving forward and then we can define what

[129:00] moving forward looks like, but I'd hate to leave these ideas sort of hanging in the ether. Um and so Nicole, yeah, that I I don't know if I can do that, Matt. what it is you're asking because that like I just I I the thinking about these ideas right and the pos possibility of like moving them forward I just to me that's bigger conversation but they're just I guess the concern is that they're just sort of floating in the ether and so since it's not in this committee these ideas got floated is there a desire to roll them to have another committee or a different group eval start to evaluate them or do we let these kind of die on the vine and next year see what happens. I just these were clearly ideas that our council colleagues some of some some of us had come up with and I just want to honor that that they maybe deserve at least some desire to to live on if that's if that's a key or not or we can just say see another time to these three items and uh if they come out of the ashes

[130:00] next year or sometime after so be it. that that's a question if that's how you want to do. But what I what I what I read in the memo at least for one of them and this may have been may have been true for all u was staff saying explicitly like this would be a work plan priority type item. Um and so like for me that that that sets it right there, right? We already have a really cool work plan just for this year. Um, and I think like for me without knowing are they all work plan priority type items because that that that then is for the next council that is there unless we're going to have a conversation about changing our work plan. I think that's what we were going to get to was if there's a desire to see them then evaluate is this a work plan item is it not because I don't know the answer to that for each item as well. So, I think that was what I was hoping to get out of is just to know what kind of lift those were because that te's us up for how or what we may evaluate down the road on whether or not we want to pull any of these back in that that so I'm with you on that. So, I didn't know if that if we want to get a quick sampling of whether

[131:00] or not this is a big or heavy small lift that may tee it up for later. Otherwise, we'll have to have that conversation at another time anyway. So, if um I would just like to know that answer. So, I don't know if that can be answered tonight if enough has been looked at it. staff, do you guys have a do you have an evaluation to some extent on how much work any either of these three items are? Um, but let me get to some other questions. I see Aaron and and Tara, do you have some clarifying comments or thoughts on where we go process-wise? Yeah. Well, I I guess Matt, I just wasn't quite prepared to answer that question because I had in reading through the memo, I had seen those listed and read, okay, these aren't really what we're considering right now. So, I guess I wasn't decision space on those. I mean, they I'm not saying they don't sound like potential positive things. I just it wasn't kind of part of my conversation or decision space as I was moving into meeting. That's fine. If we're not if we're not prepared, then we'll we'll uh leave them to the ether and see if we grab them another time. Um

[132:00] so, uh why don't we just do that since it seems like at least a few folks aren't prepared to have that conversation, which is fine. Um so, let's just So, it looks like Chris, did you get your answer to section 130? I think we did. Thank you. All right, then let's move along. Unless anyone wants to talk about uh section 130 or any of those three items that were there on that slide before we move on to the next thing. Anybody want to discuss these items? All right, I see Tara and Lauren. Tara, go for it. Well, I wanted to agree with Aaron. I didn't study what the Tacoma rent item was. I know nothing about it since I didn't think we were talking about it. So, I'm hoping that we don't do that tonight. As we are moving on, Lauren, um I was hoping to have sta staff clarify around kind of the fiscal note on ballot items because my understanding was that maybe that wasn't quite like a work plan lift, but if I'm wrong about that, please um set me straight.

[133:04] Yeah, happy to give a little more detail on the fiscal note for ballot measures. Uh, as we looked at it, we uh we actually believe that that's something that council could could have some options on. Um, and it would not actually require a ballot measure in any of those options. Um, one would be an option to to um pass an ordinance that would require a fiscal analysis as a part of any ballot measure that is then published to the community. Uh so if you think for uh you get your your blue book from the state and you get your county guide for all of the tabor based tax measures um we could do the same thing for the city where we would require essentially a voter guide to be published to the community. Um there's obviously a fiscal impact of that of being able to to print and then mail uh that voter guide to the community. Um, you could do another option which would be to pass an ordinance that requires it

[134:01] but doesn't require it to be published in a voter guide and just be accompanied to any of the council action on ballot measures posted on the website. Uh, that sort of thing. Uh, or the other option is to just do it just have direct staff to to do a fiscal analysis as a part of the materials. we don't uh need to require it by ordinance, but we could just do the analysis and include that in in any of the materials related to ballot measures. So, those are the the options that uh that we brainstormed as a part of that uh that idea. Thank you very much for that. Yeah. All right. Well, uh I think Yeah. So that is why I wanted to bring those up earlier, but I get the sense that council's maybe not ready to discuss these items. So we'll we'll um we'll we'll see where they go from there. Um okay, so appreciate that, Chris. Um we'll move it on to the next one. So I think we're going back to Charlotte for financial strategy committee

[135:01] recommendations. All right. Good evening, council members. uh we'll uh share for it on the next uh section of this item uh the 2025 tax proposals that have been considered by the financial strategy committee as well as the broader city council at our April 3rd meeting uh council indicated interest for adding an item uh to uh potential tax proposal considerations for 2025. Those that are recommended by the financial strategy committee or FFC FSC for 2025 are an extension of the existing.3% community culture resilience and safety CCRS sales and use tax, the creation of a public realm tax uh and recommended initially by uh FSC for 2026 and then brought forward by the full council to bring this forward in 2025 is the creation of a vacant property second homes tax or fee. Next slide. So, just a a background again, long-term financial strategy is really focusing on

[136:01] uh long-term uh financial health of the city. Uh uh we'd shared this forward previously that we've built upon and are continuing to build upon prior policy recommendations with a comprehensive financial plan. Uh focusing on shifting away from over reliance of uh sales and use tax or sales tax, dedication of funding sources. Um, we're going to be having uh service level prioritization conversations with the community and have worked over the past three years on uh outcomesbased system for budgeting. Next slide. The financial strategy committee guiding principles for the 2025 ballot items include looking at uplifting fiscal sustainability and sufficiency, equity, and resiliency. really focusing on stability and predictability of our service levels as an organization. The diversity, flexibility, and sufficiency of our revenues. And under equity, focusing on uh revenue structures and financial policies that aim to reduce tax and fee burdens on historically

[137:01] disadvantaged groups. And with resiliency, focusing on our ability to anticipate, adapt, and recover quickly through diversification of our revenues as well as maintaining sufficient reserve levels. Next slide. So looking at the extension of the existing.3 uh% CCRS sales and use tax, our current CCRS tax expires December 31st of 2036. This uh tax supports uh city capital infrastructure renovation, replacement and maintenance projects as well as nonprofit capacity building and capital investments. an extension of this tax. As mentioned previously, uh our unfunded and underfunded needs are great. Um and looking to support this uh as part of this work. Um so the extension of this tax would generate approximately 13 to 15 million annually beginning in 2037. So that breakdown between city and nonprofit projects is 11.7 to 13.5 estimated uh on an annual

[138:01] basis and 1.3 to 1.5 um for nonprofit uh organizations. And the focus here would be to increase revenue sufficiency and funding flexibility for the organization um for the city's backlog of uh capital infrastructure. Next slide. The CCRS tax, as we've previously mentioned, has been fully committed for uh city infrastructure, including uh East Boulder Community Center, fire station, civic area, street light acquisition, as well as critical bridge replacements. This ballot measure brought forward would also include debt authorization and would allow the city to advance key capital projects and potentially offset the effects of inflation. Next slide. The second tax uh that we are exploring as part of the uh long-term financial strategy and uh recommendations from uh

[139:00] city council is the exploration of a public realm tax. This is the creation of a uh public realm tax which would increase the existing permanent parks property tax by 1.352 mills. Um, this would generate an approximate 7 million in annual property tax revenues and would it it would expand the existing permanent parks tax and increase revenues enhancing flexibility for capital infrastructure as well as maintenance projects. This would go to support uh items and help to fund items within the public realm intended to support parks, open space, civic buildings and areas and within the public right of way as well. um including streets, sidewalks, bike lanes, and multi-use paths. And this is focusing and uplifting the guiding principles uh within the long-term financial strategy of stability, flexibility of our funding, revenue sufficiency as well as diversity uh of our revenue stream and would also allow

[140:00] that flexibility with debt financing. Next slide. The final item uh is the vacant property uh vacant property second home tax or fee. This was brought forward by the majority of council on April 3rd at our uh meeting uh council meeting at that time. This could incentivize property owners to improve, rent or sell vacant homes. Uh and we performed an initial staff analysis uh last year um that estimated approximately 850 to 4,000 homes uh vacant homes uh within the city of of Boulder. Um staff has performed additional analysis looking at water usage. Um for homes uh single family homes um with six months of no water use. And this refined estimate for single family homes only is 280 to 490. Um and this analysis excluded multi-unit attached buildings. Um the vacant

[141:00] properties tax uh and or fee could be structured as an excise tax or fee. And I'll speak more to this on the next slide. So the vac the v uh vacant properties tax or fee considerations. A vacant properties tax could be structured as an excise tax and an excise tax is imposed on uh on an act occupation or uh uh enjoyment of privilege. Um this could be based on a per unit uh basis such as a home, a bedroom or uh square footage and would require voter approval. Uh if we uh look at our estimate of water usage of 280 to 490 uh single family homes and applied a uh 7,000 uh per uh unit or uh single family home, the first year estimate uh would generate approximately 2 million to 3.4 million uh on an annual basis. And the fee is another option for the

[142:02] vacant properties uh consideration uh where a vacancy fee would uh be imposed to defay to defay the cost of government services. Some examples here and particularly in looking at research uh compared to other cities is use uh using this fee for emergency response support, sidewalk maintenance uh and code enforcement. For example, um council could adopt this by ordinance and so it wouldn't need to go forward to the voters and it would also require a nexus study to perform additional analysis and understand the estimates associated uh with revenue uh and the cost of government services as well. Next slide. So for the questions for council, does council agree with the financial strategy uh committee recommendation to continue exploring the extension of the CCRS tax as well as the creation of a public realm tax and whether council uh supports uh further exploration this

[143:01] year of scoping a vacant properties tax or fee. Thank you so much, Charlotte. Um so uh let's start with are there any questions about any of these items and then we can move into answering questions uh one AB and two. Um so let's start with questions. Ryan, thank you. Charlotte, can you show the previous slide please? Um, while you're doing it, my my question is there's um a dollar figure on the bottom of the lefth hand column. Um, can can you just say again in what is that? What does that refer to for the excise tax? Yes. That's essentially applying a $7,000 uh uh it's a 7,000 uh dollar tax on each unit um within

[144:00] that range of the 280 versus the 490 that we showed previously. Okay. Would it be possible to show the slide? I don't know if that's if if not that's fine, but um Okay. So, so but that figure is that figure slide back intended to represent revenue raised that Thank you. What is that what does that represent in terms of what it does for the city? The uh it it could potentially uh uh represent the amount of uh revenue raised. It does not take into consideration uh some of the administrative costs. Um but it it would uh reflect the amount of revenue potential revenue raised for the city. Yeah. Okay. That's what I thought. Thanks. So I'm just remembering that the um you you can you can either get the city can either collect the tax or the fee um or the homeowner can um we or we change the homeowner's behavior. Right.

[145:00] So we don't get both. So I suppose I'm thinking this 2 to3.4 4 million range would represent, you know, either us not changing the behavior or I guess maybe to some extent of it. So, just it just strikes me that we don't get both. Um, so I'm sort of I guess I I don't know that we have the mechanics to to know like what we expect, you know, what ratio of behavior change versus dollars we can expect. But maybe I'll ask you, do you do we have any indication of that? I saw Joel come off mute so I might tag tag you Joel if you had a response. Thanks Charlotte. I'll I'll uh take a whack but invite others to join. Um good evening council Joel Wagner deputy finance director. Uh this was really intended just I think really to show a bit of a order of magnitude for the first year and that's really taxpayer bill of rights requires that if we put a revenue a tax ballot issue on um we have to provide a first fullear

[146:01] estimate. Um so yeah absolutely one one would uh assume that um an excise tax or or tax on an activity would change behavior. Um I'll say anecdotally what we've seen with the sugar sweetened beverage tax um that passed uh several years ago is it didn't change behavior a whole lot which I think was a little bit surprising to the the proponents of that tax. Um, we have seen a little bit more behavior change on the vaping tax uh for for electronic smoking devices, although that may just be uh reflect that people are buying that out of of city limits. Of course, um that wouldn't apply to to something such as as housing, but um hopefully that helps a little bit and and if Teresa is still on her phone, she can pull me out of hot water if I stepped in anywhere.

[147:00] Um thanks it's good good for me. So just just summarize what summarize what I'm hearing if you know using that this is an estimate if we are if we were to achieve towards the you know this range or the upper part of the range we would expect to um be taking money for homeowners to continue to leave their homes vacant. Um if it was on the lower end then that would assume in part we would be um yeah using opening up those those homes. Okay. Thanks, Aaron. Yes. So, my my question is um when are we going to get the polling back on these potential ideas? So, we'll uh be bringing forward to city council the results of the polling on June 26th at the council meeting uh uh at that time. So, June 26th. Thanks uh thanks for that answer. And I'll just throw up just a quick thought that I I might might defer a lot of discussion on this until we hear what the results of the polls are. Y

[148:01] appreciate that Aron tend to agree. Uh let's see. Uh Nicole. Yeah. Um thanks for this presentation too. Um so you know the city attorney's office is swamped, the budget and finance team is swamped. What would the trade-off be for further explo exploration of a vacancy excise tax or fee? What kinds of things would you be working on instead of this? I might uh I might invite uh Chris to chime in on that one. Yeah, I'll uh I'm happy to to start and then I might look to Teresa if uh if she's able to connect uh on uh city attorney's office capacity. But I think uh on kind of the the policy side there's a little bit more analysis in trying to look at and explore um how would you define vacant uh how would we administer such attacks? What would be the process of verifying uh whether a unit is occupied or vacant?

[149:01] Um and then I think the city attorney's office uh has some probably additional analysis uh uh on kind of the legal side of of taxes and Tabor. And I I think uh Teresa's poor internet uh challenges. There she is. She's back. So uh Teresa, I'm trying to stall for you if you want to chime in at all on uh city attorney's office capacity. Yes. And I'd just like to say as an aside, this uh stellar Longmont internet is not doing me any favors tonight. But um you know, we anticipate that it's there's a the legal lift could be heavy after the fact. Um anticipating some challenges to to a tax um less so to a fee. Um and so that's really uh that would that would be the impact. Thank you.

[150:00] Um and then have do we have any idea of kind of how many taxes voters might tolerate especially in this period? So next year was going to be the year of considering kind of new taxes more holistically other things we might do to generate revenue. Um if we were to pursue a vacancy excise tax this year um would that preclude some other taxes that we might be considering in that broader discussion? I can share from the polling in that we're planning um we are planning on uh testing on uh choices of uh the amount of uh taxes um that uh voters would consider. And so that is uh planned to be as part of the polling questions that we have uh coming forward and and plan to share forward with council is um the consideration for the the the three taxes that we're looking at um as well as uh whether or not one or two or all

[151:00] three if there is a limit there. Okay. But and would I mean at some point I imagine there's a limit to how many kind of taxes people want to do, right? And I guess that that's that that's just my concern is that we haven't even thought about the possibility of taxes that are out there for generating revenue. Um, and the kind of revenue we're going to need to fund priorities that we haven't even figured out yet. So, I guess it's just it uh it feels a little like the cart before the horse and I just worry that we're we're closing doors. Um, but anyway, just switching to the CCRS tax um extension just for a second. I just want to be make sure I'm clear. Um, we wouldn't be able to use that. So, even if we were to put that on the ballot this year, voters pass it, that money wouldn't even be available to start bonding against for 10 years. Did I get that right? We would be able to start uh debt issuances as soon as the voter approval. So, um that would be Yeah. So, we would be able to perform that once the voter approval uh

[152:01] occurred. The actual revenue would not be um coming in until after 20 uh 36. Okay, got it. But we could start using it now or soon next year sooner. Okay. Thank you. Is that it? Nicole. Uh Tara then Tina. I have two questions which I'm not sure now is the time to answer them. So the first one is is uh I notice in the slide that Ryan was referring to that there was no uh approximate revenue we would get from the fee. Is that because you'd have to do the Nexus study to find out? Correct. Do you think it's possible that the Nexus study will be more cost more than the actual fee that we make from it? No, just kidding. Those Nexus studies look expensive. Um, second question is there was something about short-term rentals in the packet and I'm trying to remember if [Music]

[153:00] the if there would be a if how the excise tax for instance would affect short-term rentals, but I can't remember how it was. Or is that would that come if we asked you to move further and study that? Is you need to study that further? Charlotte, you want me to take that one or Teresa? I see you came off mute, too. Yeah. So, um, there is currently a short-term rental tax, and should someone elect to make their currently vacant property into a short-term rental, we would recoup the tax through that mechanism instead of a vacancy tax or or a fee for Do you think that it could have the unintended consequences of creating more short-term rentals, this vacancy, which I don't think people love? I just personally I think it um is certainly a possibility that people would choose to uh forego their vacant status um in

[154:03] favor of some revenue. I do think there's a an important distinction in the uh the requirements that we have to be able to obtain a short-term rental license in the city is um you can only obtain that if it is a primary home. uh if I believe correctly and Joel can correct me if I get this wrong. Um so right now anyone who has a house that is not uh a primary residence that is their second home, they can't use it as a short-term rental. Um uh and so I think there would there would have to be I think some behavior change by by that resident um to occupy the home more often uh and then consider a short-term rental. So uh so I think Teresa is right. there's a chance that it could happen, but I think uh it'll really depend on each individual homeowner. That's better news. Yeah, that's correct. And there's also I don't have it in front of me, Chris, but there also is a limitation on the number of nights

[155:02] um I believe that short-term rental can and of course to to be eligible for a short-term rental, you can only uh rent for up to 29 days at a time. So there are some protections as Chris said. Was that it Terra? Awesome. Tina then Lauren. Yep. Um I uh would like to do polling on the taxes in general, but I have a question whether if you tax something like an excise tax or a vacant home tax along with the public realm tax, are those results going to interfere with each other? Because the idea of taxing a second home is might be appealing to people rather than everyone being um given a property tax. or are the pooling people just I think they're probably great at this and can factor that in, but I'm that's my biggest concern.

[156:01] We are uh intending to uh test on a range of questions um including I believe the intent of the question that that you're sharing forward of um and uh the the the firm that that we are working with um uh will certainly take the information and the attent of the questions um and based on the the expertise that they have um uh help to craft and form those without any any concern. So I I don't know if I answered the the question directly, but um we've thought about that uh internally as well as staff and are really leaning on the expertise of the polling firm that we've utilized previously uh uh to help uh craft those questions and get the intent right of those questions as well. Okay. And then if we were to pass the public realm, which would put us at the

[157:01] cap of our mill levy and we did the CCS, which would have us bonded out everything for such a long time, what additional levers would there be remaining for us to look at in five years? One of the uh and and and uh council member just to confirm in in general for for taxes in general, is that the question? One of the items that we are uh looking at as part of the work within the long-term financial strategy or potential items for 2026. Um so that is yet to come forward, but we had a a range of options that uh we were looking at uh with the financial strategy committee at the end of last year. Um those are some items that would be on the on consideration for uh for 2026 and would be brought forward as potential ballot measures for 2026. Um that that

[158:00] could include uh less infrastructure uh taxes um potential shifts of taxes. So there's a lot of different options that we could potentially explore. Um and that work is yet to come as part of the the 2026 potential tax ballot measures. Okay. And just um to be clear, we can move forward with the polling this year and and delay actually putting it on the ballot if we find that our realignment work holds us over for now and we prefer to run the tax in 26. If that is uh the the will of council, uh then yes. Okay. Thanks. All right. Um thanks Tina, Lauren, and Tara. I see I still see your hand up, so I don't know. Oh, another ghost hand. Um, all right, Lauren, go for it. Thank you. Um, it seems like with the vacancy tax in particular, there are still a lot of possible options for how we could

[159:00] move forward. And I'm wondering through the polling, are we going to be looking at kind of a range of things or are you making assumptions about, you know, a recommendation about a way that we might move forward? Um, I'm just wondering with the time frame and everything how we kind of how you're thinking about structuring that right now. We're primarily uh considering structuring it as a tax given the polling questions are focused on uh tax measures for uh 2025. And so that that is primarily how we're considering to uh poll on it um not not focusing on a fee uh in the the polling questions that we have. And in terms of amounts and who it would apply to, you're thinking as it was laid out in our packet for sort of properties

[160:00] that have been vacant for 6 months and at a fee of what was it? 6,000 7,000 7,000 a unit a unit. Okay. Yes. Yeah. But presum we could set other numbers than that. that was just seemed like a in the middle of what other communities had done and that's kind of why um that's being selected. Is that correct? That's correct. There were uh two other communities that we looked at that were within that range. Um and so that is why we selected that on the higher end. Um there are other communities that set it at a lower end. Um uh so we could certainly uh look at at potentially uh a range of um a range of options, but the the item presented tonight was looking at that 7,000 per per unit. Thank you. I appreciate that. I

[161:02] think it's a good assumption for the time being. Um and then in terms of I saw that the data was narrowed down to you know only single family homes that are vacant. It would it be possible can can we imagine possibilities for ways to um collect data to apply this more broadly? um or would that just um be too ownorous in terms of staff time and or something that would just take a lot more thought to even ideulate around? Chris, just saw you come off mute. Sure. I'll I'll jump in first and then uh happy to to open it up to others as well. I think as we were trying to understand a little bit more of of you know what what is the number of potentially uh kind of vacant housing units in the community uh water utility

[162:02] data where the uh where the meter is directly attached to that dwelling unit obviously was an e easier data source to look at. Um but your point is a good one which is for a multi-unit building where there is only one water meter we you know once that the water goes past the meter it goes to all the units. So if one of those units is vacant obviously we wouldn't be able to to know that through water utility data. So that that data that we uh pulled together um excludes those multi- multi-unit buildings that could have vacant units in it. So it could be a little low. Um, and so obviously depending on how the definition of a vacant unit is set, um, that would help us really understand. I don't know if we've got a really great data source out there, uh, to to give us better data at this point. Um, but it would really be, I think, based on, um, the further, uh, drafting of how we would define what a vacant unit is, uh,

[163:00] and then the process to to verify those. Appreciate that. Thank you. That's it for my questions for the moment. And just to be clear, um, if it were a tax, it would need to be applied to every kind of housing. Um, so not just single family units. That's just the data we were able to pull at this point. Thank you for that clarification. Indeed. Helpful clarification. Um, thanks for that question, Lauren. Um, so I I have one question and we'll move into perhaps uh straw polling here. Um my question really centers around um really a nexus study. How how long would a nexus study take? Because I'm wondering really because it comes to the second question that you have that that's here in terms of e you know exploring the you know uh this year scoping. And so I'm just sort of curious uh how long would a Nexus study on this really take um in this capacity if we

[164:01] were to choose to learn more about excise tax and fees? Yeah, I'm happy to to take that one, Matt. Uh I I think if we were to to go down the XI or the the fee route and do a Nexus study, um we're probably talking uh into the fall. um it wouldn't require a ballot measure, so it could be into the fall. Um uh that I think we'd be able to have that analysis. Um the the fee would really then be directly tied to what those government services are. So while we didn't put a number, um this is my personal opinion, the the number per unit would probably be drastically lower than the the tax number that we uh we used as a as an estimate. Um, and then if you wanted to proceed down the the tax route, um, then we would keep doing our homework in preparation for, uh, your ballot measures discussion in in July and August. Okay. Well, I appreciate that. Um, okay. Well, we'll

[165:02] we'll get to straw polling. I just think that they could be framing this as a sales tax repatriation. So, maybe not as service, but repatriating a sales tax that otherwise probably would be here if it were occupied. Um, so I don't know if you can see that in this nexus study or not. Um, all right. So, let's move on to asking our straw poll questions. Uh, does council agree with financial strategy committee recommendation uh to continue exploring? Let's start with a um the extension of the CCRS. So, let's just take a straw poll and say, "Hey, are we good with the staff marching forward?" So, how many uh raise your hand if you're in agreement of wanting to continue to see the exploration of the CCRS tax? That looks like everybody. Uh, perfect. All right. So, moving on to B. uh creation of a public realm tax and and might I just maybe pause on that and maybe tweak that question of I I would I'm going to just pose maybe a slightly different question to see if if there's takers is is maybe waiting to see the results of the polling before making this decision on

[166:02] on whether or not we want to continue it because I think the straw the the poll will give us the information I think that that may do that. So, I I don't know if people have thoughts on wanting to to take that bite or if we want to just go ahead and say go forth even if the polling says no. So, I I don't know if there it's a distinction without a difference, but I I I don't need to make a decision at this point until the polling tells us something unless there's a lot of work to be done on the front end. So, I see some hands. Uh why don't we go Nicole? Um, yeah, I just had a a question for staff because they they're the ones that posed this question to us and so um it makes me think that there was a reason that they asked it this way and so I just wanted to offer an opportunity there. And then uh my second question was for you Matt which is um do we have a moment to comment because we just did questions. So do we get to comment before we're doing straw polls? Uh sure. Welcome to comment. I I'm also trying to move us along. uh we've been a little little long and uh on on the Q&A side.

[167:00] So um try trying to move us to some action. So if we want to have comments, I would highly recommend it be exceptionally brief so we can continue to move on because we still have a whole we still have more to do. And another third item Mark. Oh, can I can I question first? Sure. Go for it. Question was tags too. Go for it. and and uh council member the question was whether or not it it it impacts us if we wait for council to make a decision until later. Is that the question? Um basically yeah I I think the main consideration uh is we want to understand if there's interest in uh continuing to pull uh on uh the item uh that we would bring forward uh in late June. And so that's really the the critical piece there. Okay, cool. Thank you. Um and then my my comment was just

[168:00] um in at least in financial strategy, we had talked about this as also being an opportunity to see if voters were interested in the idea of undedicating slightly some funds. So just wanted to mention that as my comment here. All right. Uh Mark, um I have supported um the public realm tax at least to the extent of bringing it up to council for council's decision, but I I do have a couple of concerns. Uh which is why I think the polling is is extremely important. You know, we're likely heading into a recession and it diminishes the prospects to have two tax measures uh at the same time. I think the CCRS tax is absolutely critical for us and I would not want to do anything that jeopardizes that. Um, number two, and and maybe the polling can can um find a way forward on this. I'm not sure that we have actually created a a a

[169:00] focused narrative clearly identifying the need, the purposes of the tax, and the spec specific benefits we're going to derive. Um, basically, I'm not sure we have a good story yet, an elevator pitch for this tax. And if if somebody asks us what's it about, I'm not sure that the the answers are great yet. So, I would want to see some very good and sophisticated polling that indicates that people are knowledgeable um and they're desirous of having both taxes at once because if there's a choice to be made between the two, we would be getting far more money from the CCRS and we would be getting money for arts uh uses as well and and that's the one I would want to prioritize uh if it's one or the other. Thank you. Appreciate that, Mark. So, so from what I'm gathering here and what so what I've heard from staff is that with regards to the question on creating a public realm

[170:02] tax, waiting to see polling data is not at the exclusion of of this at all. We can wait for the polling data and continue to move forward as such versus we say yes now. We're kind of putting our thumb on the scale that that we really want to do this and and it would take some really bad polling to take us away. So I think that's that's how that's the distinction I'm seeing here um with with with what that's being posed. So um I'll come back to the original question. Do do we want I'll just frame it. Are people okay waiting to see the results of the polling before weighing in on the specificity of do we or do we not go forward um with the creation of a public realm tax since it doesn't seem to be at the exclusion of of work um on the front end from staff. So that's the question. Looks like we got everybody. All right. So, um, as that was a tweet to the question, we're going to just

[171:00] wait to see what the polling is and then we'll make our decision from there, likely with other things with regards to that. Um, all right. Uh, moving on, uh, comments and we'll get to hopefully a straw poll with regards to the vacancy tax or fee. Um, Nicole, yes. Um, I just want to bring up an analogy I raised in our financial strategy um, meeting and any Mario Brothers players from uh, the old Nintendo days will will get this one. But I feel like when when we're considering taxes, right, next year is supposed to be the year that we are fitting in an assessment of what kinds of new taxes may we need to address the priorities that we discover this year. um thinking about it almost like we're we're kind of headed for the boss level and we've got a certain number of lives available to us. That's how I think about these taxes. And so, um for me, it really is um kind of thinking about this holistically. Next year is really the right time for this. I think voters are

[172:01] going to love this. I I really do. I mean, I I I like that is something that probably most most folks would agree on, but I worry that it's going to take away from this bigger um discussion that we we're having next year around how we're um how we're funding the priorities that are identified this year. So, it just it feels a little out of step. and to do polling at this stage. Um, which I think is probably going to come back pretty positive. Um, it it just I I I don't I don't know what what that buys us, but it is definitely taking the process that we've set in the long-term financial strategy out of step. So, that's that is my concern. So, I don't support moving forward with it right now. Um, I think in the context of the discussion we're having next year, that's exactly the right place for us to be thinking about this tax and and looking at it and seriously considering it. Um, but without that other information to consider it holistically, I think we are misststepping here. Can I ask a

[173:00] clarifying question, Nicole? Um, is it are are is your concern about it going on the ballot this year or is your concern doing any work on it at all until it's part of a larger conversation next year? because I thought staff was saying, "Hey, this is going to be 2026 at at earliest anyway." So, I'm trying to understand what if so, if so, then I misunderstood um because I I thought we were talking about something for this year. And I guess what I um what I think about there is that the groups we poll are slightly different. I would expect that if people support it this year, they would support it next year, too. But it's also a different group of voters, and the world's going to look I don't know, maybe may may look a little different next year, too. Um let's clarify that from staff. I think was it staff on the slide? I think that you said that was uh 26 the recommendation to consider this. Was that correct? Yeah, the uh financial strategy committee looked at a vacancy tax or fee uh and was looking at it more as the timeline of 2026. What we heard on April

[174:01] 3rd is that council might have been interested in considering it for 2025. So, um, so the question that we're really asking here is, do you want us to keep going to potentially consider it if it's a tax for 2025 ballot or a fee because we still have to do a Nexus study and we would need runway for that? Yep. So, does does that help, Nicole? Yeah. Yeah. No, it does. And I mean, same same thing for this year, right? Like I just um I'm I'm going to be no on this one just because I think that this is very out of order. we don't know what our priorities are, let alone uh the conversation about the full buffet of options we're going to have to try to meet those next year. Okay. Appreciate appreciate that. Um all right, uh comments before we get to a straw poll uh and thoughts on the vacancy tax, Aaron. Yeah, and Nicole, I I think that's well said about um this year and the the ballot and I'd agree about the timing in terms of whether we put this on the ballot in 2025, but I think it's not the right time for it. I would say I would be interested in the polling and I'd be

[175:00] particularly interested because we have this um fee potential option in front of us. So I'd love to just see the poll and then think about okay that's useful as we think about maybe next year or maybe we think about moving forward with an excess study. So I' I'd just like to get to the next step of polling but but agree with you that this is probably not the right year to put it on the ballot. Thanks Aaron Mark. I agree with Nicole. This is not the year for this. And again, same issue. Um, anything we do um to put forward this tax this year um could interfere with what I think is the most important objective, the extension of the CCS tax. Um the dollar amounts are much larger there. Um I'm not very impressed with the projected dollar amounts for for uh the vacant homes tax. Yes, Nicole's quite correct. it will pass easily because most people don't have vacant homes. Um and and so it's

[176:00] basically let's tax someone else. Um and how do you feel about that? I feel great. Um so I would I don't think it's quite ready um for moving forward this year. I would not want to do that. Um and frankly that that includes the polling. Uh Aaron, I whenever we do the polling it's going to show support. So, I don't know that there's any great um uh inspiration to get from the polling. Whether we do it this year or next year, I think most people are going to support this for obvious reasons. Um it's a tax on someone else. So, I I I prefer that we postpone all of this till next year and we have an integrated strategy for whatever taxes we want to put forth at that time. Appreciate it, Mark. Um, Ryan, yeah, I agree uh with Nicole and Mark. I'm I'm interested in this. I think it's an important policy for us to look at, but

[177:00] um I don't think we're ready and I also think we're one of the additional reasons we're not ready that I haven't heard is that there's some real analysis here to be done regarding the behavioral economics of what we're trying to do with behavior change versus revenue because we can only have one or the other. And so I think, you know, the value is is on a spectrum between those two. It looks like it's probably not a real money maker, which means the the real value in doing this would be to change behavior that would lead to increased housing stock. So I just think we have some work to do um to figure that out, the algorithm for that. And I would rather just be patient and undock this from the the current ballot schedule. Thank you, Ryan. Lauren. Um, so I was someone who was kind of interested in seeing if we could do this faster and look at it on the ballot this year. To me, I think there still are a

[178:00] lot of fairly big outstanding questions and I'm not sure that we can answer those quickly enough. Um, and I I don't really see value in polling on it this year if we're not looking at putting it on the ballot this year. And I think it can cause more confusion um than help. So, I'm leaning towards um waiting till next year. to clarify, waiting on pulling or waiting on continuing to scope this work as either an excise tax or a or a fee. I'm not particularly interested in it as a fee. I think that, you know, as Ryan mentioned, part of my interest is a behavioral change and specifically we're not supposed to be having fees set high enough to create

[179:00] behavioral change. So, I think that puts us in a tricky position. Um, I really do think it's better as attacks. Um, I if we can make the mechanics of that work, um, so I think there's too many questions to make the polling and putting it on the ballot this year make sense. So, I'm not interested in polling on it this year. I would maybe be interested in potential investigation into it, but I think that depends on staff time. I know that um our attorney's office and financial analysis team are um all busy at the moment. So, if we're not going to have it on the ballot this year, I think also probably maybe it makes sense as one of our as a potential one-year work plan item in the future or Yeah. Thanks. Yeah, next year's work plans will be one year. Appreciate that. Thanks, Lauren. Um I'll uh I'll just chime in with my two cents real quick. Um, I I I I love the vacancy tax. Um, I

[180:03] do think there's behavior to be had here. You charge enough money, you tax high enough that will sting enough for people to then go, "Oh, it's better for me to sell rent or actually occupy it. In which case, we still get revenue in the form of the sales tax um when people are actually present." So, so, so to Ryan's point on behavior, I do think there's a way to have change behavior if your tax is high enough. And this is a middle of the pack tax. So, when you think about what 7,000 go to 12, call it 15. I I think we can kind of argue whatever amount needs to be one for um the the purpose of the excise tax andor any change behavior. So, I so to me, I think that's just a decision point for us and I think we can get there. Um, I'll I'll just say I agree it doesn't need to happen this year. I would like to still see us explore this. Um I think there's going to be sufficient need or want for people to see this happen. And I'm not sure that it really conflicts

[181:00] with our larger financial strategy if this is taxing vacant homes because it's an it's a separate way to generate revenue that our larger other means of generating revenue won't still won't touch this. So it's still auxiliary to any of those other mechanisms. So I think it still has value um as as a way to provide revenue and offset for the city. Um so I think that that may be a thing to still keep us in mind with but certainly for next year. So um I would certainly support the continued exploration of this. Um all right, with that said, let's go ahead and get a straw poll since there seems to be some dividing thoughts on this. Um so does council um support further exploration and scoping of uh a tax or fee on vacant properties? Um, so yeah, raise your hand if you support further exploration. One, two, three, four, five. There's Tina. All right. So, um, we got So, there's five that would

[182:00] like to see further exploration of this and and I and and maybe since it was brought up, I'll just ask a subsequent question. Um, is there a desire to have this continue on the um, polling? Um, there seem to be some concerns about that. So, um, I'll let me pose that question. Do people want to see a vacancy tax question on in any of the polling that we have coming up? Do they want to see it? Matt, I thought that was the question we just answered. No, we said about further scoping it. that was different than whether or not it was going to be polling cuz but I heard that there were concerns about it being on the polling and so that seems like two different questions to me cuz scoping of the project did not seem like that from what I've gathered from from staff and folks is not the same as polling um now otherwise that would be the question do you want to see it pulled um so uh staff do you want to offer clarity on that did the scoping actually include uh the polling or were they two

[183:00] separate things I two separate things. Let me be let me just get clarity too on the scoping to see if that was this year for a work plan item. But so because it's Teresa who I'm looking to is that a are you able to do that for further consideration for this year? I I frankly I need more specificity. I still don't know if we're talking about a tax or a fee. Um I'm not sure if we're talking about for 25 or 26. So I I think I think that if we can maybe break these questions down some more, it would be really Okay, so we have three questions to ask. Um we have do we want it do we want to see this in polling this year? So let's start with that. Um do we want to see this in polling this year? Raise your hand. All right, I think we got one person that wants to see the vacancy tax in polling. All right, so it looks like we're going to strip Aaron. I see your hand up. Uh yeah. Well, I I assumed that the next

[184:01] step if we were further exploring it was the polling and and my that was my interest was to see it in the polling and then see what we do next. Um I'm not without the polling, I'm not sure that this is the year um to do more on it. Uh okay. So from what I've gathered, there's still quite a bit of runway because if there is a fee, there's a nexus study and other work and scoping of what an excise tax could be in separate setup or preparation for next year. That's the way it's been described by stack. So I'm just trying to follow through with that description of the process. Um so um if it's not polling, we asked the question earlier, do we want to see uh exploration of this? It looks like our city attorney would like clarity as to whether or not we're deciding now if it's a tax or a fee. I don't think we can decide if it's a fee because we don't have any information on a fee. So I think the exploration has to be both and then at some point we would have to be presented with both of them from which to make a decision. I don't

[185:01] know how we make a decision on a fee without information of such. Um so Joel I see your hand. Yes. Thank you council member. Um and I I'll just offer um well first off an apology for maybe an inartfully uh written question on the slide. I will I will I will take ownership of that one. But I think just putting it in context, this was I will just share my thought. This was for 2025 ballot items was the topic. So when we're asking if if council is interested in continued scoping, um I think the the implication that maybe should have been made clear was for 2025 ballot items. So I hope that helps a little bit. It seems like council's conversation is kind of um circled maybe around around a next year thing, but that's clarity on the question just to help. Um yeah. Okay. So, appreciate the clarity. I I think the slide was saying that the our FSE

[186:00] recommendation was 2026. Um and so that's what I that's what we were working with because we like to start with the recommendations of our committees um as sort of general standard practice. So that was the general running assumption. So if if it looks like staff was actually thinking whether or not this is for the ballot on 2025, then we kind of have to wipe the slate clean a little bit. But I think it's pretty clear I think we heard from everybody that we that this is not for 2025. So does that kind of render moot any discussion or further work on this until some date later? Um or and this is a question for staff or is there still scoping to be done in order to tee up what is clear interest by council in this in some form but to still tee up some information and gathering whether it be a nexus study or other stuff so that when the time comes we need a runway for that to then be able to make a decision because even if we're talking about council priorities or anything in 2026 we looks like we still need a

[187:01] sixmonth runway for nexus study and so my worry is if we're not making those decisions until March of a retreat next year. We won't have a nexus study in time to even have a consideration for next year's ballot. So then we'll sort of be behind again. So it seems like if that's the case, we would need to be acknowledging a nexus study before completion before March of next year. That seems like a working backwards timing thing. So I just want to pose that to staff and see do we read is that reading it right? Can I add a comment Matt from just from the FSE perspective? um because I think something is may maybe there's a missing piece here that I can help with. Um so at least for me and Mark and Ryan, please correct me if I'm wrong. What we were talking about with FSC and 2026 was not that this would definitely be something for next year, but that this would be considered in the 2026 conversation around, hey, what kind of taxes are we looking at to fill whatever gap is identified through the priority setting process this year? And so, um,

[188:02] I'm not seeing Ryan or Mark correct me. So, I just want to be clear on that. We were not saying definitely do this for next year, but add it to the pot of things that are being explored next year. And four of us may not even be here next year. Um, so I I think it's a little it's it's hard to um to to think about uh you know, adding something for for a council that we may not be on to. It's a great point. I just don't know how one could or anybody could explore this if you don't have a nexus study in hand from which to evaluate whether it's a fee or an excise tax. So that's the thing is if you have that conversation in March of next year, you're then you're back really where we are where you're lucky to get a nexus study by September or or August of that following year and then it's not really up you right then you've missed the boat for it to then be on that year's belt. So you kind of render it out of that loop. So I maybe we're getting too much in the weeds here, but I I just don't see how we get a I don't know how we don't initiate an exit study if this is

[189:00] something to be considered because that's critical information for consideration down the road. All right, I see Teresa, Aaron, and Nur because we have kind of lost the lost the plot here. Um for sure. Um Erin, go for it. Defer to Teresa. Thank you. So, one of the things that is clear is that a fee I I I'm wondering if I could help frame this up a little bit. Um, and I don't think we have to I I think the question for today is is there a ballot item to go on 2025 with respect to a vacancy tax. What we know is that a tax can raise revenue. the fee will cover the cost of the services that we are providing. And so they're quite different things really. Um and and so I think there is a predicate question of what is the intended goal here? Is it to

[190:02] raise revenue um or is it to to offset the government services? Um, again, I I I I think the question for tonight though is is really limited to are we putting an a are we looking to put a vacancy tax on the 2025 ballot? Thank you for that clarity. I think we answered that question that no, nothing for 2025. But the question that is posed here from FSC was whether or not it could be part of it would be a part of discussion for 20 whatever is discussed in 2026. But you can't discuss a fee without a nexus study. So then that that's where we backed into that. We can just jettison that and be like yeah we'll just roll the dice see where that runs sometime in March. Um if that's maybe where we need to go but it does seem a little shortsighted that we wouldn't think about that ahead of time since it requires about four or five months to do that. So Erin, go for it. I

[191:00] have thoughts, but I'd like to hear from Naria and then I'll share my thoughts. Uh, thank you. And I I think and I appreciate that. I I think that 2025 question has been answered. I think it's it's calling the question and I I get where you're going, um, council member. Um, I think it's a cart before the horse. You've got a you've got a suite of options for 2026. One of them could be this. And I think there's a school of thought of do you talk about that and get some information now before that decision is made. But that requires time and effort from staff time and effort that has some tradeoffs, right? And I I think that's almost a work plan item and the and it's calling the question, do we want to add this to staff's work? And that is a that is a question to be asked right here. Does council want to put this on staff's work in anticipation for a question that has not been answered for 2026 on whether you even want to pick this up? So, that is perhaps

[192:02] I'll I'll scrap my line of inquiry and and just know that it's going to be scuttled for 2026 based on the timing question certainly as it regards to a fee. So, so we'll just let that be that. So, it's kind of I don't mean to discourage the question. I'm just saying you all should just vote on that. No, that's fine. The timing won't won't won't make that work. So that's totally fine. We'll we'll move on. It'll probably be an excise tax if it is if it is anything. So we'll move on. Go ahead, Erin. So my thought was to address that, Matt, that that our our question for tonight is is it a ballot measure? It's not. We've answered that question. And what I would say is that um we could um consider a council member could consider making a CAC request for a nod of five to kickstart a nexus study later this year and we could have that discussion if that were brought to the table a little later on. So I don't think that's what I I don't think that's that's our scope tonight, but just wanted to say I don't think that would have to go off the table 100%. Because we could still have the conversation later on this

[193:00] year. Fair point. We'll we'll cross that road uh when we get there. So I think we've answered the question. No in 2025 and uh we are moving on some some slope. You're muted. Got muted all of a sudden. All right. Um so moving on. Um continue after vacancy taxes. I think we're going back to Elicia. All right, our next area that we are going to cover for council is the update on community sponsored city petitions and also the update on uh state and regional ballot measures. So, I'm going to pass it over to John Morse, our elections administrator, to go over those areas. All right. Good evening, city council. This is John Morse, elections administrator. Uh luckily this is mostly informational so not too heavy

[194:01] of a topic but I'm here to provide updates on our community petitions as well as regional measures uh with some of those updates happening in the last 24 to 48 hours. Um so two important tidbits of information to know before we get into the petitions is the the magic number this year is 3,41 valid signatures that our petition committees need to gather in order to be uh certified. And then the second uh important tidbit of information is the deadline is rapidly approaching uh May 28th is when the petition committees need to turn in their petitions. So next slide please. So the first petition that was approved for circulation was a pearl for you petition. Uh in short this petition was seeking to establish a community space on Pearl Street between 9th and 11th Street. Uh it was approved on January 27th and they elected to use the uh BDDO online petitioning system and paper petitioning. Uh so I'm sure you've heard in the news some developments on

[195:00] this. Uh but as for the most recent updates, the petition committee has uh reached out to the clerk's office uh and they are considering uh withdrawing their petition. They stated that they're also planning to uh cease campaign activities. However, we're still awaiting an official statement from the petition committee uh with with each member electing to withdraw that petition. Uh so until we receive that uh the petition will be live on the BDDO. Uh next slide, please. The second petition that was approved for circulation was the new development shall have shall pay for its impacts petition. Uh in short, this was seeking to have new development or redevelopment uh cover the costs of infrastructure as well as long-term climate change costs. Uh it was approved March 5th and this committee elected to only use a paper format. Um again, updates with this one. The petition committee reached out to the clerk's office and they have indicated to us

[196:00] that they are planning to also withdraw their petition. Uh but similar story we are uh awaiting an official statement from the committee uh until that happens. Uh next slide please. Uh the third petition that was approved for circulation was to have more affordable housing in low density areas. Uh the petition was asking uh as is evident to expand affordable housing in the community. It was approved on April 1st and again elected to only use our paper petition systems. Uh this followed the same story as the new developments petition. Uh the committee reached out to the city clerk's office and they have stated to us that they are potentially considering withdrawing their petition. We're awaiting that official word uh to be signed by all petition members. Uh next slide please. And the last petition uh the fourth that was approved for circulation was the out of Excel franchise petition. Uh in short, this petition was seeking

[197:00] to terminate the electric franchise agreement with the public service company of Colorado and the city of Boulder. Uh it was approved on April 1st and we have not had any updates on this one uh from the committee and they're electing to use our online system as well as paper petition system and we're planning on having them come in uh May 28th to turn in their signatures. Uh so next slide please. That concludes our uh initiative petitions uh in the city. We're going to move on to regional. Uh so next slide there. Uh we've spoken recently with our friends in Boulder County and the Boulder Valley School District. Uh at this time they're not anticipating any ballot measures led in their jurisdictions. Uh it's still a few months out. Uh they have a deadline until July 31st to have anything on the ballot. Uh so we'll update you there if anything comes up. Next slide, please. At the state level, uh we felt

[198:01] that there was four important initiatives to bring to council's attention tonight. Uh three of which are very similar initiatives. 47, 48, and 65 are all seeking uh to decrease the state income tax. However, it's a little different percentage- wise for each initiative. uh those three have had their titles approved so they move forward in the gathering signatures process. Uh the third initiative we felt uh important to bring to your attention was initiative 51. This was the repeatial retail delivery fee initiative. Uh it's currently awaiting a tile title hearing last I checked. Uh so there's still a few more steps in the initiative process that need to be completed uh if that is to get approved to gather signatures. Um, as you can see, it's still a little ways out at the state level uh to gauge, you know, if that'll be on the ballot. They have until September 3rd to gather their signatures. Uh, and with that, I'll go to the next slide. Uh, we have one question for council tonight. If you

[199:01] have any questions on our petitions or any regional items, All right. Thanks, John. I can't find the mute button tonight. Um, appreciate it. Thanks for the update. Um, let's see. Uh, Ryan, go for it. Thanks, John. I think I have one question, and I'm looking at the petition number two, new development shall pay for its impacts. And this is a maybe a technical question for um I don't know who, but um can can somebody explain that don't we already do this with impact fees? And so what what does this suppose would be different than how we already think about impact fees? I might look to Louise or staff on this one. Um hello everyone. I'm Luis Toro, senior

[200:02] council and city attorney's office. Um I think that just the intent was to put this into ordinance as as stated in language and um you know the uh the committees don't share their thinking with us. We're just looking at it for compliance with law and things like that. So um can't give you too much insight on to what their motivations were. Okay. But definitionally um we do I guess for this to be established as legal and accepted do we need to do anything to assume or define words here or no this maybe I don't who my question myself but I'm just wondering if we know what this means or not. visa v um development impact fees sounds like maybe well I know the the um I can send around the complete ordinance language if you'd like to take a look at that um but u you know it's just to add some language to

[201:01] ordinance and like I like u uh John said we've been told that they plan not to move forward with the petition anyway so okay thank you I sorry for the technical depth there appreciate Nicole, go for it. Thanks. Um, just a a quick question that may be more of a finance question. U, when we have local ballot measures that might impact revenues, uh, we tend to account for them as we're moving through our budget process. I don't think state income tax impacts our budget in in any way. I mean, maybe some cascading impacts or something, but are there any local impacts that we might expect from any of these state measures at this point? happy to answer. Initially, I think it would be something that we would have to look at uh further um to the extent that it doesn't uh squeeze out other uh uh areas that uh

[202:03] the state supports um the city. Um but we we we would we would need to take a look at that further. Okay, cool. Thank you. and it it um these measures haven't even gotten signatures yet or anything like that. So, it's still a ways away before we would know anything about that. Right. Thank you. Fantastic. Um any other questions? All right. Thank you so much, John. Really appreciate it. Thanks for those updates. Um all right, on to the next All right. Thank you, Matt. Um, so lastly, I want to just go over next steps between now and the May uh November 4th municipal election just to get some key dates on your calendars and then, you know, back in the back of your mind so you'll know

[203:00] what we're working toward. So, as Charlotte noted, we do have a June 6 um June 26 meeting set to follow up with discussions with council on the results of polling for the long-term financial strategy ballot items. So, I'm not sure with the conversation that we just had, um I know we're going to do some polling, so I'm pretty sure we'll keep that date. Um July 24th is our scheduled date for the first reading of all the ballot measures that will move forward. We've set August the 7th for the second reading and the public hearing on all ballot measures. And this is a potential date to have final adoption. But if there is amendments needed or a second or third reading that is required, we've set that date for August the 21st. Now again, we can finally adopt things on August the 7th, but we are slotting that August 21st just in case. And then we are also wanting council to

[204:00] approve the ballot order that will be certified to voter count. Um the last meeting before council um that the last meeting of council before the ballot has to be certified is September the 4th and our September 5th date is the deadline of the approved ballot order that has to be submitted to Boulder County. So, with that, is there any questions on our next steps and and and where we are as far as timeline goes with the ballot measures for the November 4th election? Okay. Well, if that is the case, we thank you for your time and your efforts and uh all your discussions. And if you have any questions, please don't feel I mean, please feel free to reach out to me or John. I saw where you're going. Please don't email me or reach out to me at all. I saw where you're going with that. Oh, no, no, no. I can understand that. I definitely publicly even especially I love my All right. Thank you everyone for

[205:00] your time. Thanks, Alicia. Thanks, John. Um, and and Chris and Charlotte for for working us through those ballot measures. Really appreciate it. I know it was a little bit of a slog to get through there. Um, I I own that for not helping us navigate a couple of those questions um as cleanly as we probably should have. Um, all right. So, thank you for that. So, moving on to our third item. And I think it would uh we'll just go ahead and tee that one up. Um this is sort of um a later ad, but this is regarding a discussion on a draft letter to the Boulder County Region Opioid Council expressing council's potential interest in investigating um in investing the opioid sentiment dollars um ambitiously in sort of new treatment opportunities for our community. Um, this was a a joint thing that uh, council member Marcus and myself sort of put together and we uh, sent a joint letter to on hotline for all to sort of get a sense of what we were thinking. But I want to turn it over to uh, Tina to frame that and sort of set up that

[206:01] that conversation. Um and then we can sort of have a short dialogue about whether or not we want to move forward with that and if there's agreement on kind of thinking about uh retooling and thinking about sort of larger impact investments with this um really important funding for our community. So Tina, take it away. Yeah, and you just framed it really nicely. Um I think that we're all aware that the regional opioid council is looking at a a one-time large amount of money that um goes into $30 million but is not necessarily available at one time. uh however it's likely to um come through. And the idea in this case is given our communities um struggles uh helping people who are in or dealing with um drug uh usage and having a hard time changing their behaviors and and finding the treatment that they need. Uh our hope is that we would see an investment in a program that was new and where we might see some more um impressive results than we have

[207:02] seen historically. And it's really it's not a criticism of the opioid council. It's more of a expressing a desire to see something transformational and hopefully encouraging them to look outside of the box. Um, Nuria very kindly sent out today uh a link that shows you how they've distributed the monies to date and it's going out in um a lot of small uh funding grants to already a wide range of agencies that exist in the county. Um an idea might be and and the other thing is our our letter is intentionally not prescriptive. We're not giving an idea, but just asking for sort of a to consider something bigger that maybe we haven't seen. And of course, the the recent um news about overdoses in our town is is really challenging to hear that we're still not helping that community. Um and so that's it. So Matt, do you want to add anything? Oh, and I'm

[208:01] sorry, the other thing is um outcomes. So we're really looking at adding outcomes to the funding regardless of how the council goes. Uh if you go to the website, there are no outcomes listed with any of the grants at this time. And I think it's just really important when we invest money that that is like this that we answer the question that our community is asking. How are you investing this money that we're going to see something that's different than we've done historically. And I think that's part of the question we're looking to ask. So Matt, do you want to add anything? No, I think I think you nailed it. the key is transformation and outcomes and those are pieces that are missing. So, um I I think that that's a great opportunity. So, I'm really just really glad that that there's an opportunity to discuss this. Um so, appreciate that, Tina. Uh I see Aaron and then Nicole. Uh just wanted to really thank uh you, Tina, and Matt for bringing this forward. I wholeheartedly agree and uh hope that we send this letter on.

[209:00] Thanks, Aaron. Nicole, yeah, I just um also wanted to say thanks for bringing it forward. Love transparency, love outcomes. Both of those things are great. Um the only thing that I was wondering about though is if there's any uh opportunity to note a sustainability issue as well, right? Because sometimes when you know you have these big investments as we saw with a lot of the ARPA funding um it can become problematic uh when when when you need to continue it and that money is no longer there. So that was the only other u piece of it that I was thinking about is is there a way to sneak in something about um sustainability as well. Thanks. And you mean like financial sustainability? Yep. Yeah, exactly. Like longevity, right? Um developing a model that is both transformational and can sustain because I know the county's having a hard time just like us. Very true. Appreciate that. Uh Erin, is that still a hand up or is that our third ghost hand of the night? It's our third. Third time's a charm. There we go. Mark,

[210:01] I I like the concept of the letter and I do think we should send it, but I I I will tell you that I'm a little unclear what the precise ask is and and I don't want to be less than clear because we're we're trying to get them to invest a lot of money. Um, so I I I if there are specific programs that you advocate for, I would prefer to see us ask for investment in specific programs. I I know it's strategic on your part not to do so, but I'm I'm not sure that you wouldn't be better off by saying this is what we want. Um, and uh, you know, obviously you may have a different view of it, but that that's the only suggestion I would make. I do support sending out the letter. However, appreciate that. You know, let me let

[211:00] Tina chime in. I think the the the real purpose is is not a specific ask like in detailed programmatics, but I think is asking for a a shift in mindset to to to maybe not think of being spread with a little bit of money in a lot of places, but how can we use a bigger pot of money to do bigger things? And that's that's a philosophy change than it is something specific like a program. And I think that's really what we're asking is is a is a shift in philosophy and how we approach um these settlement dollars. And so I don't know if if if Tina has anything to add to it, but I hope that that answers your question and it's not going to have that great specificity um in that sense because we're not the experts and we want to kind of unleash the council or new partners to to define what that um transformative and and outcomebased and sustainability um based um uh new model could be. It does answer my question. Yeah. So, Mark, I would, as I said, I would tend not to be prescriptive partly because

[212:00] I'm not a mental health treatment expert and there's certainly better people qualified to answer that question. And since we don't have outcomes on most of our programs that I could find, I don't know how I would evaluate it. But one approach might be instead um for the council to say something like, okay, we want to hit this goal of treatment. We're going to create a request for services and it's going to be a larger dollar dollar amount that we've ever had and we have an empty building uh that's already zoned for treatment that we're going to throw into the mix so that we can come up with something that's really powerful in our community. Um you know we and we do have there is an empty zoned mental health building that the county has. Um, so it could be something like that. But I I would really I don't think we ne necessarily know the solution. And that's part of the letter is to really start thinking differently. But I also saw Nura's hand was up. So it was thank you uh if it's okay to

[213:02] speak to it. And I I just want to say I'm I am a member uh of the council and putting that hat on. I will say that uh to the question I don't take it as a criticism. Uh I'm actually very excited. I'm one of the members who um and and I don't think I'm alone. I know I've spoken to Commissioner Levy about it. I I we welcome some transformational project uh projects and I'm actually excited about the urging to continue to see proposals in this area and so um thank you for the urging. Um, we know we have I have spoken uh to the council about this and um I was going to say that the way in which um the projects come to us and the ops board and I know Wendy Schwarz is in there and I just want to give her a a shout out for hanging with us uh in our staff and HHS. She is part of the ops board and the experts that join us. So, thank you for hanging in with us all this uh time. Um but the staff really looks at those because they are the experts and those

[214:01] project proposals that come in. They come to the council. We are wanting and hoping to see larger transformative projects come and in fact the there is that mental health facility and staff has been talking to Clinica about trying to put a project before the council so that we can evaluate something like that. So, we're hoping um to see something come before the opioid council in this next funding round if that comes forward. So, some of those projects need to come before us in order to be considered. Um so, we hope uh we can make that kind of transformative difference. The other thing I wanted to add to your point about evaluation, I just wanted to say that um the Boulder County does have a request for proposals right now from for an evaluation um firm. Uh and hopefully that's to evaluate all the programs now to put some of that outcome data. So you should be seeing that soon. Um because we also want to have some of those uh transparent outcomes out into community.

[215:02] So um just appreciate that and know that that's coming. Nura, may I ask are you suggesting that you do want to see something more prescriptive or that the general is is fine? I I think the general has to be fine because some of the projects have to come from us and we do not know what those is. What what those are and frankly um what we'd love to see is is people to come with those transformative projects to come forward and being too prescriptive could actually box them people out. Love to have some of those ideas come forward. Okay, great. All right. Uh thanks Mark and appreciate that response area. Thank you. Uh Ryan, uh thank you Matt and Tina for your work on this. Um this is definitely an area where we could really use some breakthroughs. Um so just a thought um and I'm going to ask Nuria a question to you at the end of this. Um the argument that you lay out um is instinctive to me

[216:00] that it that that's a good ar that it's a good argument that we need more focused strategic funding. Um but my second thought is you could also make a different argument. You could make a case that the the the largest number of entities who are um who we were moving funding through are creating a multiplier effect in the community by virtue of the work that they're doing. Um I don't know the answer to that. I I also think about this idea of transformation and how it's very exciting but um usually with transformation you you know you sort of need like an overall approach and it makes me wonder what besides the funding would be needed to support an effective transformation but then that gets I think to what Nurio was just saying is like well what's what is the plan for transformation like what substantively what are we talking about so I guess I'm finding this a little bit hard to um know how to intervene without an analysis from like from our team if such

[217:02] a thing exists. So Nuria, I guess I'm wondering from your or the team's perspective, do you do you have a view on like is will this be helpful? I mean I and and Wendy correct me if I'm wrong, but the way I take your urging and I that's why I appreciate the non-prescriptive um wording of it. The way I take your urging is think creatively, think outside the box, think what else can be done because up until now we've been funding a lot of programs. Certainly some that um have existed uh some that have been doing great work and I would say all of them do great work but have we seen new innovative programs? I don't know that we have seen a lot of of new programs. We would like to see um I would like to see I'll speak for myself right now. Um what else are other communities doing? Um we are not the only folks that are receiving um these settlement funds. Um love to continue to hear from staff who are um

[218:02] engaged in conversations across the state. What interesting ideas are happening out there and to glean some of that. I think those are conversations um uh that we're going to be inviting our um operations team to maybe think about in our next meeting um to see what's exciting out there. Um our first year, frankly, we were needing to do some shovel ready product uh projects because there was funding that needed to go out the door and um and we knew what was working right. uh and I think that that was a great place to start but now we are seeing other opportunities to see what is what's the possibilities. I appreciate actually um uh Nicole what you were saying too uh sustainability is a big important piece of it. We could have a project and without saying what it could be, but we could have a project that let's say we we there's a facility that we have, but that also will need ongoing funding for

[219:00] staffing for services because at some point that will stop the the 31 million or 30 million at some point ends and then what, right? Um because there's that there's that issue. So there has to be a strategy and a plan for continuing funding as we move forward. Um and that is just one example. Who knows what other examples could be? But strategy is important and we need to focus and depend on the expertise of the folks that are doing that work, which it's not me, it's folks like Wendy uh and the folks that are in uh Boulder County staff who really know what it takes to move that forward. But I do think that um the world of possibility, I don't think we have yet seen of what good ideas could be. Now Wendy, tell me all the things that I've gotten wrong in all of that. I never tell the city manager she's gotten anything wrong. Um so uh I I just I will say that um I I agree with uh what Nuria just said and I also want to note that um another way of looking at

[220:02] this funding is uh how can we knit together other things that um that can magnify? And so we talked a little bit about um the issue of like you know Clinica has a new facility for acute care that's going to be coming online and what's the right mix of things like opioid funding that could blend in with other things to give people a more robust and connected continuum of services that are easier to access because maybe you walk upstairs instead of somebody telling you to go to another facility. across town. So, um, so I think it's just really it's thinking about those big impact ideas that can be achieved by this funding that maybe are not as easy to achieve in other ways. Wonderful. Thanks. Oh, Wendy, I forgot to ask, could you introduce yourself for

[221:01] the record? Oh, apologies. Wendy Schwarz, Housing and Human Services. Thank you. I probably should have caught that on the front end, but just for those that are audio listening, you know, we have those evening trail runners that like to listen to our study sessions out on the out on the trails. Uh Ryan, go for it. That was it for my question. So, should I do a comment now if I have one or what what should I do? Sure, go ahead and make a comment. We're we're going to be wrapping wrapping this thing up and we'll we'll we'll take some guidance from there and we'll get to everybody else. Okay. Uh thanks, Nuria, for for that. I I'm hearing your openness to this. Um, I'll admit I'm still just kind of scratching my head though about whether I have the um the knowledge to weigh in to say that that $30 million wouldn't, you know, given all the the constraints and limitations of the future isn't it isn't for staff to decide like the best use of that and that it's not the, you know, going through existing channels. So, I'm I am but I'm hearing that this is meant to be

[222:00] sort of um o pretty open um and it's more an expression of our I guess intent to be bold. Um but in which case then I'm wondering like is what you know what does it offer? So anyway, I'm really grateful for this work. I'm still thinking this this over in the moment. So um thank thank you. I'll leave it at that. Thanks Ryan Lauren. Um, thank you Nura and Wendy for your and the rest of staff that works on these questions. I think they're really challenging and um I appreciate the work you're doing for this council. Um, and thank you Matt and Tina for bringing this forward. I really appreciated the way the letter was already crafted. Um, and kind of that ask for like please try and go big. I think that makes sense with, you know, the un that this is an opportunity in the size of the amount of money that

[223:00] we're talking about. Um, it might turn out that maybe there aren't there isn't an obvious really big idea for us to go after and the what we're doing right now is what makes sense, but I think um it's a good question to ask and push for and I'm fully in support. Thanks. Thanks, Lauren. terit. Um, it's I just really hope with all this money that we're getting that we don't fritter it away and that we could use it for something big. And I really liked the letter and I give it my check stamp of approval. Proceed. All right. I appreciate that, Tara. Um, I guess like with all things, um, I guess we'll just do a straw poll so we're really clear. Um, are we um, and I did hear that Nicole would like, you know, something to reference financial s uh, sustainability. I think that's a good suggestion. I'm I'll look

[224:02] to Tina as the co-author of this or All right. So, at least certainly as the authors of this, we're happy to add that. So, we'll go ahead and say like uh, it's just a straw poll. Are we good? Uh, is council okay submitting uh, this letter to the council? Um, and certainly with the additions that Nicole recommended about adding a little piece about financial sustainability, is that something we're interested in? All right. Looks like we got a looks like we got a majority there that wants to see this uh letter get passed forward. So, um, Tina and I will we'll make that u uh edit uh per Nicole's suggestion and then we'll turn it over to staff for that to get uh sent out in its uh official channels. So, uh, well, thank you, Tina, and and thanks, council, for, um, willing to have that discussion in fairly short notice and appreciate CAC scheduling that. So, so thank you for that. Uh, appreciate it. All right, so um, that brings us to our 40 p.m. on Thursday.

[225:03] Um, any last thoughts or comments? And maybe, how dare I even offer it? I see Tara shaking her head that that was a silly offer. Congratulations. Anyway, graduates. Uh, that's right. Congrats to the graduates. Yeah, it was really cool. Aaron and I got to celebrate them today. It was fantastic uh commencement. It was a wonderful celebration. Thanks for saying that, Aaron. Um, all right. Well, uh, no one else got anybody anything else to say? Uh, we'll adjourn our study 40 p.m. U, be well and we will, uh, see you later. Have a good night.