Welcome folks. It is six o'clock. We're going to commence our city council work session this evening, September 29th, 2025. Ms. Benowitz, please call the roll. Council Member Mangieri. Here. Hunnigan. Here. Miller. White. Present. Achera. Here. Saul. Here. Cheeseman. Here. Mayor Schwartzman. Here. Seven are present, Your Honor. Thank you. pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation, under God, indivisible, with liberty and justice for all. Okay, we have public comment this evening. If anyone wants to have a public comment, please step forward, state your name, you'll have three minutes. Good evening. Good evening. I stand before you tonight as a director, yes, but first and foremost as a son. For me, this is personal. My father, Ben Bennett, is a part of this community. And I know what it feels like to worry whether he'll have what he needs. Maybe in some ways that's selfish. I fight for seniors because I cannot imagine standing by while my own dad or anyone's parent goes without. But being a caregiver has taught me something larger. It's not just about one household. It's about every senior across Knox County who deserves meals, care, dignity, and connection. It's about every family who wants to know their loved one is safe. And it's about every child, like my own children, who are watching us closely, learning what it means to step up, to support your community, and to do what others choose not to do. I don't want to live in a community that turns its back on its elders. And I don't think you do either. Because here's the truth. As time moves forward, as our pace slows and our hair grays, the gaze we cast upon our seniors today will be the same gaze we receive tomorrow. I've met some of the sharpest, wisest seniors in Galesburg and throughout Knox County. They are an untapped wealth of wisdom, strength, and resilience. They are also the largest volunteer force in our city. And you will find that that's true almost everywhere in this entire nation. And that's why this movement has struck such a chord. As you know, over 850 people, voters of every age, from every neighborhood, from every economic background, have signed their names to say with one voice, we stand with seniors. They believe, as I do, that this is not charity, but justice. Not an expense, but an investment in dignity. We are not here to demand or divide. We are here to invite. to work with you, our local leadership, to unlock more than $700,000 in Title III federal funds. Together we can leverage a modest local investment into a massive return for seniors and for Knox County as a whole. So tonight I ask you, not to see this as just a budget item, but as a moral choice to recognize that standing with our seniors means standing with ourselves, our families, and our future. And when this is done, I want us all to rise, seniors, leaders, neighbors, raise our arms together in triumph. Because we are V&A. We stand with seniors. And when we stand with them, we stand with the very best of who we are. Thank you. Thank you. Next, is anyone here for public comment? Please step forward, state your name. My name is Georgia Lepisto, and I am someone who has benefited from the programs that the V&A offers. When caring for our mom, because of the services that were available through the V&A, she was able to stay in her home for a longer period of time. Also, while being a full-time caregiver for my late husband, Dennis, who had Parkinson's disease, we also benefited from the services the V&A offers. While caring for him, I fractured my leg lifting him, and I was non-weight-bearing for six months. When I called to inquire about the meal delivery program, I found out that not only did he qualify, but I did also. I don't know how many of you have been caregivers so far in your lifetime. If you have, you know the endless struggles and exhaustion. If you haven't been a caregiver yet, consider yourself very lucky, but know one day you probably will be. It's very stressful. Just a service like getting meals delivered to our home was such a relief. I have a good friend who cares for her mom with dementia, plus several other extended family members she's trying to help at the same time. Her mom recently started getting the meals delivered. Providing just one meal a day can give such a relief to a caregiver and a senior. That's one less thing they have to coordinate, to do, or worry about. After my husband's death, my own health issues started to stack up. My doctor said it was time to finally take care of myself. So in doing that, I now take advantage of the gym area at the VNA. It has helped me through a very difficult time in my life and helped me tremendously on this health journey. I see on a daily basis so many seniors being helped. The staff is incredible, so kind, caring, and truly compassionate about helping seniors in our community. I see them leaving to go to do home visits with a smile on their face and the kindness a senior in need deserves. I see all the seniors coming to the building for the different services offered. Crafts, bingo, billiards, chair exercises, the Mr. IT program, card club, the exercise gym, Medicare coverage options appointments, caregiver counselor, help with getting a reduced fee on a license plate sticker, and many other services. And all the seniors they provide a warm meal to five days a week. Possibly the only warm meal they are getting for that day. I see the friendships that are being built between these seniors, the fellowship that is shared between them. If they didn't have this place to come, would they have anyone else to talk to in a day? I worked in a nursing home environment for three years. I understand, of course, the importance of nutrition, but being around other people is also so important to these seniors. Some don't have anyone else, no one to help them or advocate for them. Who else in our area provides services like this? If we don't get this funding... Ma'am, your time is up. I apologize, but your three minutes are up. Okay. Thank you for your time. Anyone else here for comment? No one else? Okay. We need a motion to adjourn the meeting and reconvene in the Erickson Conference Room. So moved. Thank you. Thank you both. Any discussion of that matter? Seeing none, I'll call for a vote. Oral vote. All those in favor, say aye. Aye. Anyone opposed? Well, we were convening in, say, two minutes? Yes. In Eric's room, and this room will be the overage room, so you can still hear the meeting and follow us. That room is small and can't hold too many guests, but it's still an open meeting. Thank you for those who came. Thank you, your honor. Thank you, council. Thank you to staff. I apologize. battling some stuff allergy-wise, so you can't hear me, I'm sorry. Try and speak up. Tonight is the budget work session. For a few of you, this is your first one. So what we try to do is provide a comprehensive overview of how city funds are spent, where the money comes from, where it goes, how we came to some of those conclusions and obviously answered questions. To my right, as you know, Ms. O'Hearn, who manages our finance department, does an incredible job along. Ms. Billiter, who is the liaison that lived in her office that kind of oversees the budget, had basically been working since, I don't know, she sends out a discouraging email that says it's budget time somewhere in the May-June time frame. It makes all of my colleagues depressed. No, just kidding. And the budget process starts. And the culmination of lots of meetings and activities start internally with the departments, then move into a more cohesive movement, meetings with the budget team, conversations with council, Obviously, we're taking feedback from a lot of different places to get to the place where we at least get to where we are tonight, which is kind of the draft, the initial draft of the CY26 spending plan. And it's a little different here. A lot of times you'll hear the terminology FY for fiscal year. It's a little different. CY is because we actually operate on a calendar year budget. So the spending plan goes into effect January 1st. Obviously, Ms. O'Harn will kind of walk you through the schedule and those that have been through this before, it'll look eerily similar to last year, only with updated information about what we expect to happen in the coming year based on information, obviously a little different this year. You know, we try to incorporate some of the priorities from council and the strategic plan that we did last year. Obviously, we try to hear your priorities and then get those adapted into the ultimate spending plan. My colleagues honestly deserve, you know, all the credit they, within their departments, put together. the needs in order for us to deliver services that then go in across the spectrum. And we tried as part of this presentation, I think we got some pretty good feedback last year You'll see, you know, we're gonna go in depth tonight, not necessarily all into the weeds of terms of every line item, but to help you as elected officials, but as important or more important to the public, understand where the money goes and why, and how those impacts citizens, as is always the case. There are far more wants and needs than there are dollars. And so that's part of the interaction with council tonight. From here, we'll gather feedback post-presentation. At the next meeting, October 6th, on your desk will be the draft budget with every single line item in the city that looks something like this. From there, we have about 30 days, 30 to 40 days to walk through Any questions you might have, and then as you, the experienced council members know, you know that then we start doing public hearings, passing the levy, ultimately passing the budget in December. So that's kind of the layout for this evening. Again, just want to thank my colleague, Ms. O'Hearn, her team in finance, led by Ms. Billiter, and obviously to all my colleagues for all of their hard work and honesty. hours and hours, hours spent putting this together. And with that, unless there's any questions directly for me, I will turn it over and let you help explain what's going on in CY26. And start having some fun. Okay, so for those of you who are here for the first time, it's gonna be a treat. All right, so as Mr. Hanson mentioned, we're gonna go through the draft budget. Overall, here are the topics I wanna cover tonight. I wanna go over very briefly our budget calendar, like Ms. Manson said, it's pretty much the same every year, the timeline is about the same. I also wanna go over our tax revenues, the various buckets of tax revenues that we receive. There are quite a few different buckets, so I'm not gonna spend a whole lot of time on every one, but as I go through them, if you do have questions on anything, please feel free to speak up and ask. After that, we're going to go over our fire and police pension, look at some property tax estimations, and then really get into the 2026 budget with a main focus on our general fund, our park and rec fund, and our water fund. Those are our main operating funds, and that's where the bulk of our money is. And then kind of some big picture stuff towards the end. We've already got through some of this, so that's good. May through June, all of the departments work very hard. They get their forecasts. They get all their priorities. Anything they want us to consider for the budget, they get that all put together. They have that to us by July. And that's when Mr. Hansen, Tanya, and I, we start going through everything and seeing how much money we're going to have. what we can fit. In August, they also provided us with our revenue adjustment, which are our fees for the year, the fees that we charge for parks, for our permits, for water, all of that stuff. And then now in September is when we balance and discuss the budget, which we have done, and we are going to provide the draft budget to Council tonight. We're also gonna give you the detail in October, And we're gonna do readings on our revenue adjustments and do a property tax resolution in October, November. We'll finalize the revenue adjustments and do a public hearing for the budget, along with first and second readings on property taxes. And then in December, we're gonna get that budget approved and get our tax levy finalized. We will have all of this done by December, so it is a very long six, seven month process that we go through. So we're going to start with our tax revenues. The most important thing I want you to come away from all this is our tax revenue is where we get the bulk of our revenue for the city. We do get 50% of our revenue from the taxes. Our intergovernmental revenues include things like our grants. So there's a chunk there. Our use of money and property, that includes our bank interest, and that's usually a good amount as well. So that's why that's... The rest is a very small, very small percent of our budget. Our tax revenue does fall into, basically I put them into three main categories. We have some that are collected by the state and then dispersed to the city. We have those that we collect locally, and then we also have our property taxes. So the first one I want to hit on is our Again, this is one that is collected by the state and that is dispersed from them to the city. As you can see on the right there, our total sales tax is 9% and it's broken up into all those little pieces. So the state of Illinois is 5%. A local tax, which it does come back to the city, is 1%. We also have our home rule of 1.25%, that comes to the city. Then you have a portion to the county, you have the public safety county money and you have the education county money. That goes to the county and the city does not see that directly. So out of this 9% sales tax, 2.25% or 25% of the sales tax comes to the city. Yeah, of course. When you say education, you're talking about District 205? Yeah, that's that 1%. So for the county public safety and the county education, those have to be voted on by the citizens. So those were the 1% goes to the school and the public safety goes to the county for that 25%. That's restricted to District 205? Yes, correct. We don't see that. It doesn't go straight to the school. No, it's District 205. The city of Galesburg is considered to be a home rule or non-home rule. Home rule has a lot more, I wanna say freedom, ability to, we have the ability to set taxes. So for instance, that home rule tax, we can raise that or lower that in further increments. We don't have to go through a referendum and have the voters approve that. Home rule, non-home rule counties do have to have Like for instance, Knoxville is not helpful. So 25,000 residents who are automatically home. Is that right? By state statute. By state statute. So it's not just 205 that shares in it, it's dispersed. Yeah, I think the majority of it goes to 205. I believe it's a countywide implemented school. May I ask you this? The grocery tax that was eliminated, was that part of Illinois 5? No, we won't get to that. Sorry, I'm out of time here. Okay. You go to a grocery store in Knoxville, you're in this county, but you're not in the city. You won't pay this 100% fee. It depends. I actually think... They have additional taxes, too. I think the next slide is cities' taxes. All right, sales taxes by municipality. So these are just some of our comparable, somewhat comparable in the region, cities and their tax rates. And you can see it has the state, that's the 6.25. And what that makes up is on the previous slide, it's the Illinois 5%. That's what makes up that 6.25 and that's why everybody is the same. Home rule is, for us it's 1.25 and it can vary, again, all these different cities can determine raise or lower in 0.25% increments for their home rule taxes. And then the school facility tax is who has implemented that and on what percent. Same thing with the county public safety on the right is the total rate. And as you can see, we're kind of right in the middle. Molina Rock Island is still a little lower than us. Peoria is the same as we are, and normally Monmouth are a little higher. those funds when we receive them and we distribute them some goes to general fund the majority goes to the general fund and some goes to our park and rec fund and i have it broken up into sales and use tax which is all all part of that one percent they just split it out and you can see the blue bar is our sales tax the green is the local tax change so much? It's changed a good amount in 25, and that's because the state of Illinois put a new rule in place starting January 1st, and it has to do with out-of-state retailers. So before, if there was an out-of-state retailer who maybe had a showroom or had salespeople or something within the state, and they made a sale, they only had to pay that 6.25 state portion. So now that they've changed it, they've switched it up and they call it use tax, but now they're paying the full sales tax. So it's paid based on the location, the address of the delivery of the items now. So instead of paying 6.25%, if you deliver it to the city of Galesburg, they're paying the 9%. So overall, they're expecting that to maybe give a slight bump It's a little too early to know if that's going to happen, but it has shifted the proportion. Is that from online buying? Is that what that's from? Some of it, yes. Yeah, a lot of it. But there's a corresponding deduction out of the use tax. And you'll see that in your budget book. While this is up, use tax is down substantially with the offset. Well, the green is small. Yeah. So we're saving citizens on the one hand with the use tax, but we're still charging salesmen to offset that. I wouldn't say we because this is the state of Illinois. you were only paying the 6.5% use tax. Now you might have to pay the full 9% because that company isn't going to eat that tax. They're going to charge the person who's buying. to do away with that, but they put it into the hands of the municipalities. So if we wanted to continue to receive that 1% grocery tax, we could adopt an ordinance to do so. And that would have had to have been done and postmarked to the state by October 1st. I know at this point we have elected not to do that and we are not going to do that. I do want to point out that our reduction in revenue, I took kind of a middle of the road figure here because state of Illinois doesn't really provide very detailed information on how much we actually receive in grocery tax. So I had to kind of back into some numbers to see what I could figure out. But I'm assuming it's gonna be anywhere between 500 and $750,000 is more than likely what we're gonna lose annually by not having the grocery tax. And I did a real quick calculation just to see. We have about a little over 29,000 residents With that loss of $600,000, each individual is gonna save about just under $21 a year for the grocery tax. Or if you translate that in the households, there's about 12,500 households in the city. Each household will save just under $48 annually by reducing the grocery tax. but the 591 municipalities did it, so that's majority, what do you think? Well, so there's 1,300 municipalities in Illinois. Now that number came, I had that number, Illinois Municipal League gave that number as the 922, but those are municipalities who still have reported to them. So if somebody decided to adopt it and didn't report it to IML, it's not gonna be on the list. My guess is that number is higher than 591 and they have a list. that anybody can access from IML or if you wanted I can provide that to you so you can look. But 591 out of 1300 is about 45% of the municipalities have adopted it. We discussed this, obviously, you retain the right, but at this point, this is out of the budget. Well, I think you should get some credit for it, because there's definitely ramifications for it, as you'll see later on when we get into the pension discussion. Yeah, I mean, for all intents and purposes, we are one of the few cities that has not instituted since this was 2020. I think that's absolutely the point. They're taxed to death. This is the state putting it on us while they're trying to make themselves look good. We have to make the decision to do this. Who wants to ever vote to raise taxes? Unless it's something absolutely legitimate that everyone can agree on. I like the word free. They're all attracted to that. There is no free lunch. our general fund it goes into our parks fund it goes into community improvements and infrastructure and it also goes into our economic development funds so it does get distributed for those purposes now you can see on the graph obviously there was a large jump from 23 to 24 and that's because in in 23 The rate was, the home rule tax rate was at 1% and they decided, the council at the time decided to increase that to by a quarter percent to the 1.25 in order to sell bonds for the community center. Part of that was that that increase in tax also went to pay for the bonds. So which is about $720,000 a year and we're expecting to make about 1.2, 1.3 million a year from that extra quarter percent. So about half of that is going to bonds, the other half that we're using for things like community improvements and infrastructure. Well, that's for just the quarter percent. We actually received 6.1 million total in 2024 for the last year we have. I am estimating that that will increase from 25 to 26 because from 24 to 25 we increased. That is one of the bigger pots of taxes, bigger bucket of taxes that we have as the home growth tax. So the bond expires what year? 2032 is the last year. So again, to ask a question here, from 21 to 23, relatively stable, what caused the steep increase? sales tax increase that was passed to pay for the bonds that were issued in 23. But the tax was in excess of the payment for bonds because you have to increment in quarters. You can't increment in like tens or nickels. We were using this to finance our debt. Yeah, in part. But ultimately, in 10 years, That revenue is still there. Doubles, essentially, the amount that we can utilize. So if you look back, you can see where 1.25% is very consistent. And honestly, right, that in part is what Without that, we'd be having a different discussion. collections from individuals, and then a slightly different percent from trust-to-state partnerships, that sort of thing. So annually, we seem to have about just under a 6% increase in income tax, and we are expecting it to continue as such for the time being. That's a 20% increase in five years. That seems like a lot. About 6% a year, just under 6%. has increased a good amount over the same time period so it wouldn't the income tax would be going up and all of these numbers too and I know I have it up there all these numbers are just dollar amount but it gives us an idea of the general increase over the years next the state also provides us with a replacement tax with personal property replacement tax We do not expect that to really change much. It might be flattening out a little bit, at least according to the state. They estimated, let me get my number correct here. They estimated for fiscal year 25 at 1.3 million. And we received maybe 20,000 less than what they estimated. So their estimates tend to be fairly close. And what they estimated for 26 was another 1.3 million, just a little up. So it's a 2.1% increase. So it's a little bit of an increase. It's not much. I don't expect going forward in future years to be any different. It's not going to. For anybody on council, especially the new members, the best source of information on this is in the IML magazine. They do a thorough review of what this tax is and how it's calculated. It's all state driven. And there's an explanation on this drop and how the state... Part of it is that they... and overpaid in the early years during COVID and are now taking their money back, much to our detriment. But anybody who wants that, I think I offered it last year as well, just send us an email. We will email you that article. It's the best source of information to help any elected official in the state understand this particular revenue source and what it means. But obviously it's still... You know, $1.3 million is still a significant revenue source for our operation, even though it's obviously down substantially. But it's still there. It's still significant. And if you want to better understand the personal property replacement tax, let me know and we will send you that information in that particular article, which is also in your IML magazine. get video gambling tax. These are the machines that we have talked about recently. The amount that's received by the municipality who has these machines, it's based on what they call net terminal income, which is basically bets in versus minus bets out. So the state takes that total amount of money and overall we get it ends up being approximately 5% of the net terminal income is what we receive from the state and that ends up being, we get about $53,000 a month is what we average from the terminal machines. That is a small amount, it's only 2% of our net tax collection. businesses who are collecting about 30%. So they're getting about six times what we get. So if we get about 600,000, they're getting about 3.6 million. The state also gets 30%. It keeps a lot of those businesses As you can see, things are kind of flattening out, and I also think that we're not getting new requests, but we're not getting as many new requests as we were prior, in part because there is a flattening trend of the revenue in terms of the activity that's going on here. But I think we gave the calculation, it was somewhere around $1,200 a machine in value when we went through this last year. But we discussed the video gaming tax and setup and permitting before. I do watch this pretty closely, not so much from the revenue side, but just the activity side, because it has impact on business. And as you can see, it's there. But when you go month by month, it's definitely flattening out relative to the steep climb from 21 up. But there's also a substantially larger number of machines in the community than there were in 2021 as well. Do we have any idea how much money we get from other forms of gambling? Lottery purchases. Not getting direct money. can look and see. Sometimes IDOR will provide us with like kind of categories that I can look and see if they have a breakdown of something. And the last bucket of tax revenue we get from the state is this motor fuel tax. So the state currently, their tax is 48.3 cents per gallon, and it is distributed to the city based on its per capita basis. And what we do is, separate fund. So we do keep these funds completely separate. It doesn't go to the general fund. It doesn't go to parks. It goes into a separate motor fuel tax fund specifically for maintenance and construction. This has increased about 2.2% year over year. And we average about 1.3 million per year from the motor fuel tax. for the state of Illinois portion of the tax discussion? I want to call the council's attention to this particular slide because while the trend line looks really great, how many, I don't know if I can draw this fine, Aaron, how many miles of road do we have in town? About 80. We have about 80 some miles of road and we have less than a million dollars a year. I know that this is one of the most abundant complaints that you receive as elected officials. Roads, potholes, roads, potholes, right? It's legit. But the reality is that the cost of fixing roads is not proportional to the revenue that's being received from the gas tax. This is obviously a statewide problem, so I'm not going to go into it, but there's also a city gas tax slide But just look in total number and then think about the votes that you take when we go out for bid to just fix a handful of roads and realize that $800,000 does nothing in the grand scheme of things. And that is one of the ongoing challenges. And that does not include the worst of the roads, which are owned by the state. Grand Avenue, parts of Main Street we get complaints about. Obviously there's stuff along Henderson Street that's problematic as well. And our maintenance allotment for that to help the state is less than 90,000 a year. Air, remove snow, all the above, right? So this is something we're gonna, and I think all cities, we're gonna have to continue having this as cars are more efficient, There's less motor fuel tax money. Roads are getting more expensive. So I think this is something from a council perspective, not tonight, but I certainly want to call attention to just some of the challenges of trying to maintain 80, 90 miles of road with a million dollars, which sounds like a lot, but the reality is it's not. Do we know what a 2019 number is on this? Because that's pre-COVID, right? If COVID probably shut us down a little bit, from my perspective, that would be more of a number to... This gives us a false sense of growth. Right. I mean, it's $600,000 growth. A $60,000 growth is, I mean, that's only three-quarters of the year. Well, and it is only, even with this, it's only like 2.2%. Yeah. Cheers for Hagan. somewhere or the other to figure this out, to do anything that makes any difference to something that's a high priority. For instance, in 2024, we collected a total of just under a million dollars, 970,000. And we, of that, we kept $340,000 of that. So we kept about 30. What would the Galesburg Promise in that year, what's the dollar figure they would receive? Galesburg Promise in that year, they got about the same, $340,000. They got 340, the city got 340. The Orpheum got 100, and Torso got 190. We set those. The council has authority to modify those as we- There are agreements that would require council action, but yes. And the largest, is the Orpheum on all the- No, Galesburg Promise tends to get- Gets more. Gets more. Galesburg Promise gets, and then Galesburg Tourism is next. There we go. And then the Horford. I'll be clear. the Fund 24 economic development fund that supports facilities like that, in part because I believe at the time, and you certainly understand, I think the depot brings in like 70,000 people. So there's some economic benefit, and so that's why it's paid out of that fund. We also have a city gas tax, as Mr. Hanson mentioned. It goes hand in hand with the motor fuel tax. It comes directly to us. our rate is 4.5 cents per gallon and that has been in place since 2015 and again this is also a totally separate city gas tax fund that we strictly use for maintenance and improvement of roads and streets and as you can see that number is very settled I think Daneville is the highest, about eight and a half cents if I remember correctly. This is from a couple of years ago. I worked on the project before I got here. The four or five cent is pretty typical. That's what you're seeing. I mean, the four and a half cent is pretty typical. dedicated funds for dedicated purposes so 33% of the tax we received goes to our stormwater utility fund which is to maintain our system or new construction if needed and 67% of it goes to our utility tax capital project fund and that is the that is the fund that we use to do those kind of bigger one-time I understand the full extent of the amount of that tax, you really have to add those two numbers together. Two bars together, right? Yes. And then also then add another quarter or third, I suppose, in this case. So it's over $2 million. Yeah, so I can give you, yeah, in 24, we got $2.25 million. So $750,000 went to stormwater and $1.5 million went to capital growth. I see somewhat of a decline. utility taxes, at least in my experience, they've flattened out for many years. Things are becoming more efficient, more efficient appliances, more efficient HVAC, you know, and so these are straight taxes, you know, the more you pay. So, obviously, as things have gotten more efficient, or if you have milder winters, or which, you know, summer's gotten a little warm, but I mean, you know, over at 365, cars are more efficient than they used to be. It's the same with motor fuel. Cars are more efficient than they used to be. Less gas to go more miles. Therefore, if you're driving the same amount of miles, you need less gas, therefore you're paying less tax, therefore there's less money. Right. You said that rate in 2015. Not this rate, but the previous one. Yeah. And so . Right. I know I've been sitting and talking to some friends of mine, and their utility bill seems to be going up. Well, the cost of electricity is going up. The cost of electricity is going up, but does that create more taxes, though? If it's more efficient, you're using less, but it's more per unit, it can kind of even out. Does that make sense? Well, I mean, the tax on $100 or the tax on $200. That's what I'm speaking about. There's no doubt that the overall rate has gone up, which at certain months, yes, there would be, but I think on the 12-month average... But a lot of what Ameren is pushing out, right, is that you're seeing the spikes in July, August, or July, August, September. But the other parts of the bill have been pretty mild. But the rate even here went from $0.04 to $0.07 to $0.10. That's what's driving the bill. Have these taxes been used to finance any major capital projects for the city? every year. Yeah, I mean, for example, utility tax is essential in making this possible. Facility improvements, whether renovations to the fire station, we've made renovations to the police station. We have some parks money in there. You got it? Yeah. So in our current year, in 2025, we have money for a seal code of park roads for various park maintenance projects. One of those 250, we have $210,000 for the public safety building galvanized water line replacement. We have Cook Park. renovation funds are in there as well. This one also does pay some to bonds. So there is about $650,000 that does get paid to bonds as well. So it does fund that. So it's kind of in there. Not in this one. No, not right here. Not on this one. Okay. That was from 2016. assess value for Knox County, or I'm sorry, not for Knox County, for the city. So from 2016 until we actually just recently within the last couple of weeks received our estimate for 2025. So it is not final, it is an estimate. However, usually the estimates come pretty close. So as of 2025, our EAV is 462 million. which is an increase of 5.66% over last year. Now, if we go over the entire time here for every tax year, our average annual increase for an assessed value is 3.63%. And when people talk about their property taxes and how much it costs, taxing bodies are what set the rate. And if you live in the city of Galesburg, these are all the various taxing bodies that will set the rate. You have District 205, you have Knox County, you have the city of Galesburg, you also have Galesburg City Fire. Now those two, council determines the rate for those two. So we're the ones who provide the rates for both of those. The public library is also on there. we do determine the rate for the public library as well. That is part of our property tax levy. Besides that, we have Cross-Hamburg College, we have Sanitary District on there, the Township, and Knox County Soil and Water Conservation. And as you can see, the school district is, School District 205 is by far the largest portion of everybody's property taxes. It's almost 50%, and it's been that way Knox County is second, and then Gettysburg is just right below that. But altogether, so the 2024 rate and the way the taxes work is the levies are a year behind. So this is what everybody is paying now in 25. But the rate total rate is 9.27831. And then we go further. as well. Did you say that? Well, that's not part of the city levy, but. No, they vote off. Separate meeting that you'll have to go to. We don't set the school though, District 205. And I will tell you though, over the past 10 years, It's not much, but the rate has had average annual reduction of 0.29%. So the rate has been very, very, very tiny amounts going down over the past 10 years. This is overall, I'm just talking overall. I just don't know if that number would track on the decrease in the students in the actual. Oh, for the school district? Yeah, so this tax rate here, this 9.27, that is the lowest it's been since 2012. In 2012, it was 8.9. Now the city's tax rate, combining Gillsburg City and Gillsburg City Fire, it's the lowest it's been since 2008, it was 2.342. I'm gonna listen to that in the room. Yeah. I mean, this gets a lot of attention, right? We put it in our annual report. So the good news is that the previous slide where it showed EAB, believe me when I tell you you do not want to live in a community where the EAB is growing. So the EAB is growing, which means your house is worth more money, which means even if the tax rates stay the same, you pay more money. Right, and that's the interesting thing. Now I will say, and I've said this many times, I've even said it on the radio, the city gets blamed for everybody that's on this chart. And we're a little less than 20% of it, or right at 20%. The vast majority of it is mostly out of our control. Obviously, you know, we have a great library facility. And that's a piece of it that doesn't impact our general fund at all. And then obviously the township is a separate entity that you vote on. It's not typically that there's a complete overlap where you all are the township trustees, but that is the case here. Usually that's a separate governing body. But 80% of the tax bill, if the city went away, is still there. And we'll show you roughly where most of this money goes. And again, this is not a critique or a question, but it's one of the things that is certainly misunderstood is that 80% of this chart is going to support other places, regardless of what the city does. And then in our piece, which John will break down, the vast majority of the money in property tax that we do collect goes to pay for public safety. That, you know, the recommendations and, you know, I mean, it is at least encouraging that for a period, things were going up. But, you know, this rate is the second or the lowest since 12 and our rate is the lowest it's been since 2000. And that's a testament to the councils and the staff over the years working to that. But in the end, if your house is worth more money tomorrow, regardless of what the rate does, your tax bill adjusts to the value of the house. As Mr. Hansen mentioned, public safety pensions are a big part of our city's levy. So we are gonna discuss that a little bit before we discuss our recommendation. So basically the city, we make contributions to the fire and police public safety pensions And what we do is we receive, every year we receive an actuary report from fire and from the police. And part of that report shows us two different numbers. It shows us a state-funded target, which is to have the pension funds 90% funded over the next 16 years. This is the minimum contribution that we can make, and that is based on parameters set by the state of Illinois. It also includes an actuarially recommended calculation and that's a little more aggressive. That is to bring the funds to be 100% funded in 15 years. That target was set by the police and fire pension boards to get them to 100%. Now, what that means is that if you're 100% funded, you have enough money in that pension fund now to pay any current and future, anything current and future that you owe. What percentage of cities are at 90%? I don't know if any, but there could be. But it's a pretty ambitious goal. Yeah. I'll show you each separate pension. They're actually very similar. Their results are very similar. But this is just showing you from 2016 to 2024 actual dollars. And then because 2025 isn't done, I have our budgeted amounts in there and what we are estimating for 2020. So that blue line on the bottom is showing that is that state minimum dollar amount that we are required to contribute. The orange line at the top is that actuarially recommended contribution amount. As you can see, it's quite a bit higher. The green line is what we have actually contributed and sent to the pension funds in the various years. If you'll notice, we pretty much stayed in the middle up until about 2021, we only did the minimum, but then in 2022, we went well over The actuary, the air suiting, just to kind of catch up. And we had extra money at the time, so we were able to put some extra funds in there. And then the next two years, 23 and 24, we have been able to provide that recommended dollar amount and put that towards the pensions. And that is based on our financial policy, which I will also go over. In 2025, we did budget kind of a middle-of-the-road amount. you'll notice between the red and the blue line, if you notice how they are kind of growing more and more apart. So the gap between the minimum and that fully funded amount is growing more and more every year, it seems like. So I will point out for the police pension funds from between 2016 and 2024, we did contribute $24.6 million, which is about five and a half million more than the state requirement. they are currently 53.17 percent funded as of the last report so as of january 1st 2025 was the last report we received and as i mentioned with our financial policies at the end of each year with our general fund if there is excess balance if we have excess balance we do contribute that money towards police pension funds to fully fund those And then if we still have money after that available, we do contribute it to our replacement programs if they need to be funded. And then beyond that, if we still have money available, we put that towards our planning fund for any future kind of capital that we might need to do. And in 2026, the ARC amount is just under 4 million. The minimum, I can't even read that, is... About 2.6, we'll go to 2.6 million. So the gap there is about 1.3 million between fully funding. And we have the same thing for the fire pension fund. You can see it all looks exactly the same. For the most part, the contributions are very similar as far as how much we contribute. In 2016 and 24, we contributed $25 million, which is about 5.6 more than the state requirement. The fire pension fund is 51.79% funded. And in 2026, the difference between the minimum and the recommended is about $1.2 million. I want to ask you, so, of course, I was mayor most of this time. So in 2025, That's the budgeted number. With the expectation that will be excess funds at the end of this year. Do we have an estimate of what those would be at this time? It's usually early spring. Probably April or so. But I want the county, especially the councilors, we budget below that red line intentionally. But the hope in recent years is the expectation that there will be money to put toward it. So we might be here a year from now and we'll see, well, hopefully those two, the green and the red will be closer together for 2025. It looks like we're not making progress, but back to your original point. I asked the actuary this when they came here. If you look, starting in 2020, But we started in 2021, we were below, right? We did the minimum, but we made up for it. So we kind of, 21, 22, 23, 24, and hopefully 25, we have met that goal of 400% in 15 years. I just want to emphasize that point. That is a very aggressive strategy, probably not one that most cities are able to do. But we're trying to stay on that high road and who are doing their best to stay there. And our policy that you just outlined is very explicit about that. And that's, I mean, for my, I just want to emphasize, this is a core priority of this council, previous councils, and has been the current council. And I think it's lost on many people in the community, so that's why I'm really putting a lot of emphasis on this. We are really determined to make sure that our current and future safety officers are taken care of. That's the bottom line, that's what we're talking about, right? I will also mention though that just because it is not currently 100% funded doesn't mean it doesn't have enough to cover, like make payouts. I mean, it doesn't mean it's in trouble, it doesn't mean anything like that. Not all people who benefit from this will retire or need payments at the same time. So, yeah, it's a long game. I mean, I know that this is one point. The state's been telling us for years and years and years that we need to figure this out and solve the problem. And many communities, from what I understand, talk to people and they're kind of sitting and waiting for the state to do it. We're like, we're not waiting for the state to do it. and that says a lot. I mean that, I think, I support this, the council's, I've never heard an objection to this, and it's a statement, I think, to our personnel. It really is a statement of commitment to our personnel. over those nine years, we've contributed an additional 1.2 million, just over 1.2 million each year to the pension funds. We spent about six and a half million this year. We'll be putting in six and a half million this year. Yes, that's what's in the middle, right? I will also mention back and take a look I was just curious as to see where we were as far as how much it was funded in 2016 versus how much the most recent and I was I was a little surprised to see that it's actually only increased increased less than 4% it's gone from about 50% funded on both of them to about 53% The percent fund hasn't increased much, and I couldn't tell you exactly why. I'm not an actuary. I'd have to talk to them to find out. Well, early in that record, my recollection is that there were restrictions on how that money could be invested. So the money didn't grow. So there have been some adjustments. Because compared to IMRF, where the money can be invested much more aggressively, we've seen growth. This was, essentially the state had rules that restricted that, so it kind of kept it growing very low, but I guess in the last two years or so, it's been, we've been allowed to get a little more aggressive with those funds. Okay, good to know. Any other questions on this? I mean, in the end, approach it is acting you know we've made some positive progress we continue to continue to fund and the policy remains the same obviously we can't reject out any additional funds which is why the line looks the way that it does and then it adjusts after the end of the year so that's that's kind of where that's at so this is just showing us currently what we have budgeted for 2025 is just under 5.4 million for both funds together. That amount is about 2.1 million less than the recommended contribution, which again, at the end of the year, if we have the funds, we will be able to put the money towards that. And to the right there is the new numbers for 26. So the minimum required contribution is just under 5.3 million. The ARC on the far right is 7.8. So in the middle of the road there would be about 6.5 million for the current year. And that's what we're looking at trying to figure out for the tax. So here I wanted to show you, give you just kind of some options here and show you how it affects the tax rate for the citizens. So I have four options here. If we go with the state minimum, If we went what we levied for the prior year plus an additional 75,000 to each fund, the median amount and actuarial recommended contribution amount. So if we look at the state minimum at the top, if you go over to the right there, it shows you the estimated tax rate would be 2.29. I will tell you right now our current levy is 2.387, so it would reduce our levy. And if there was no change in value of your home, it would save the taxpayer $3.81 for the year. Now, if we look at the next option, which is gonna be the option I would recommend, which is a prior year plus the 150,000, that's still a reduction to the tax rate going from 2.387 to 2.35, and it would still save the taxpayer $12.46 a year. I also have on the right a truth and taxation hearing. If we have an increase of more than 5%, we are required to do a truth and taxation hearing, which does require public notice at public hearing if you want to increase those taxes over that 5%. Now if we went with the median or the actuarially recommended contribution, those would increase our rates by a good amount. And it would also increase the amount the citizens would pay by either $60 or $152 annually on their property taxes. And again, this is just our portion. This is if everybody else stayed the same and we changed. So this is, that's where those numbers are coming from. Just kind of give you an idea of how it's going to actually affect people on the property. Any questions? So now this is gonna show our whole, my full recommendation for our taxes for 26. On the left-hand side, you'll see our 25 rate and our 25 extension, which is a dollar an hour we're expecting to receive in 25. 26 proposed is in the middle, and then the change is to the right. So what I'm proposing is we go with that, with our prior year contribution, plus the 75 to each of the police and fire pensions. And that's going to decrease our rate from the 2.387 to the 2.35. Based on the EAV increase, it'll change our extension amount from the 10.4 to the 10.8. So we will be getting an additional about $400,000 for the year, which is a total dollar increase. It's a rate decrease, a dollar increase of about 4%. What was it this year from last year? I don't know. It's estimated because that EAV number, that assessed evaluation that the county does every year, when they gave me that estimated number, when I compared last year's number to this year's number, it adds actually increasing by 5.66%. So if we reduce the rate slightly, people will get hit with that full 5.66, they would just get hit with that 4%. if that's what their house value goes up by. Some people's house might go up by more, it might stay the same, it might, we don't know, we just have an overall number. And that overall number consists of residential, it consists of farms, it consists of commercial properties, industrial, railroad. So it consists of all of that, although residential is over half, a little more than half of that whole value. should increase in a decent year. You don't want to leave the community where it's decreasing, probably not. I mean, the other thing, if you just, I mean, look at the chart, look at the quick math, right? Public safety pensions are north of 5 million of the total. We have to fund the pensions, that's a requirement. Then you add in the fire and the library levy as well. that's eight and a half of the 10 million. The rest covers IMRF general funds, park and rec, gets roughly 1.6 million of that allotment to operate the city. And you'll see in a little bit how that gets broken up. But in the end, the vast majority of the funds in this particular revenue source go to pensions and related to public safety, as well as the operation of the fire service, which I think most people would argue is important. And then obviously the library is going to get about $2 million. So that's the vast majority of this. And obviously inflation is higher than what these numbers indicate, this is our attempt to try and make sure that the rate does not go up, that the levy impact on homeowners is as minimal as possible, but allows us to put some more money into the pension funds. If you go back a slide before, Jen, if we did the state minimum, we could drop the rate lower, but we would actually be putting less money into the pensions this year than we did last year. and you will see regression on the funding of the funds if we start putting in less. So we put in and levied this year, if you go back, I think one more slide, this year we levied 5.3, right? That was our levy this year for those two pension amounts, correct, Jen? Right, so go to the next slide, please. If we did the state minimum, it would actually go down to 5.2, which means we would be, less guaranteed money property tax this year if we adopted the state minimum than the year prior because last year again we're trying to make progress on the pension so we're trying to send more money to them and that's how that math comes out. Can we go back to the one with the fingers? dollar figures that you have for each of the . So I'm going to, I don't know why this is distracting me so much this time. So our parks and rec fund is our library fund is whatever it is. That's our general and parks and rec. They share that. So that's shared for the whole of all of our parks. And the city. And the city, yes. Almost no part of the property tax actually goes. I just think it's very striking. I mean, I think we do an amazing job, but that's when you compare, you know, one full facility getting $2 million, and then you have to take care of all the parks and all that, well, with about half that much, it's kind of striking. I mean, obviously we get, as Jen discussed earlier, there's other sources of revenue that fund the operations of the general fund. This is just the property tax piece. But yes, very little, again, what's misunderstood, I think, out in the public is that most people think property tax funds the operations, and the reality is for the city, property tax does not fund operations. Obviously, there's no general lease. There aren't a general. There aren't a general. Yeah, it's actually two separate levies. that I put together on one slide to show it overall. I'm just thinking that although the house property value goes up, the citizens really don't. Sometimes they don't see that or don't understand that. That causes their taxes to go up. All they see is my taxes are going up. They don't understand that. So how do we... how we can pay that information to them so they don't come and tear my door down if they mad at me because I've raised their taxes. Part of this presentation is to arm counsel with information to answer that question. We encourage you to keep these slides and say, no, here's how, but no doubt, I mean, In the end, my bill was X this year and it's Y next year. Correct. And as you saw, there's a lot of different taxing bodies on there. People aren't going to go through them. Before I worked for a municipality, I didn't fully understand it. You know, I mean, most people aren't necessarily going to. I'm hearing sometimes I don't understand it at all. We're only 20% of the entire total tax. Correct, yeah. And ours keeps dropping, our part of it. Yeah. But citizens, they don't catch that. You guys just raised my taxes. This is probably the most important part of the evening, is the levy. So we're not asking you to yay or nay, but certainly within the next couple of weeks, we need to know because we have to start the process. This is what we're recommending in order to send money to the pension system and keep working operationally. Obviously, if there's surplus funds, those obviously go to pensions first. So, you know, it's likely we'll send more money. But this is something that ultimately tonight, you know, we wanted to present. Obviously, you've seen if you go back to that other four choices, right? There are options on here. I don't think either Jen or I believed that you were going to let us walk out of here with options three or four. And I don't know that the state minimum is the right thing to do either because it's actually sending less money to the pensions next year than this year. This is where we tried to get to where there's a slight reduction, fully comprehending that the levy itself is going up by about 400,000. So for those homes that are worth more in value, their bill will go up slightly. depending on how much their EAB went up, but this is the recommendation we're making to put forth this part of what's in the spending plan. Anybody have questions, concerns, comments? Really the ones that go up aren't really increased that much. I mean some of them did this year. Well, I think that the last year, we had this discussion last year, right? There was a reassessment, and then there was a pretty significant adjustment in the school rate, which I think actually did come down a little bit this year. But the big jump the year prior was there was a significant reassessment of the whole city, and some bills were a lot, and I don't want to diminish that, and the city got blamed for it. I don't want to diminish that either because you all took the calls and the meetings, but the reality is, you know, we can show factually that the city's rate is not what's driving the property tax discussion. We're about 20% of them. This is the explicit. That's a 22. 22 is 7.9. that was here that we call on the flag. So the assessment that is done is not done because there's no plate. Let's just be very clear about that. The city assessor's office and the county assessor's office. And who oversees that? The voters oversee that at some level. You're already saying it's true or not. state agency that oversees the assessors as well. But I'm not picking on our assessors per se. That's not my point. There is oversight over the assessors. Yeah, I mean, I don't want to pick on the assessors. But I mean, that's the check. I think we believe that this is a reasonable position for us to do the things that we do. That's why we're making this recommendation. Get more aggressive on the pension side, which has ramifications for the rate going up. We could also put less in if that has ramifications on the back end. Because in the end, if our pension funds regress, the state minimum goes up. We are required to levy the state minimum. We are required to say levy. We are required to pay in the state minimum. or they can come after our local shared revenue. So I think this is a reasonable violation. That's why it's on the . Now, what do you say that we have to have in order to make the truth in taxation here required? What's the number again? 5%. If it's more than 5%. Yes, so if either the rate or the dollar amount you're expecting to get is over 5%, you're required to do the truth of taxation. And so with the first two options, we would not have to do it. With the bottom two. But we're doing 2.7%, right? The 2.78 is the increase from the 25. Yeah, so it's actually overall it's 4%. So we're under the five, so we wouldn't have to. I was just wondering, is there a percentage that we can go up to raise some of that? Because you're at 4% right here. Okay, all right. And I did also do just kind of a quick estimation example. If somebody has a home value worth $100,000, the tax they would have paid on that left side for the current year would be $795,000. with our rate, and again, this is just the city portion, not their overall bill, so it's just the city portion. If there is no change in their value and we go with the recommended rate, next year their taxes would go down by $12.46. If their value of their home increases by $5,000, so it goes from 100 to $105,000, their taxes will go up by that $26. just showing you that that's the effect of change in value, even if the rate is lower. And we mentioned a big reassessment a few years back in 2022. Is that big reassessment every five, four years? Every four years, okay. So it's like the perfect storm all came together. Yeah, yeah. These are all of our city funds. So I have our 2026 proposed revenues, our current 2025 budget and what the change would be. Now this isn't, I didn't detail out every single fund we have because we have 38 of them and that's just too much to put on this list. So I grouped some of them together, but I wanted to keep some of the larger ones separate. So as you can see on here, we're going from a 69, $69.6 million budget and 25 for revenues to $76.3 million revenues. So that's an increase of the $6.7 million. And if you look, the majority of that increase is $5 million from the special revenue funds and $1.5 million to the general fund. And I'll get into that a little more specifically. I mentioned the other special revenue funds are increasing by about $5 million. Now that's mostly from anticipated grant revenues. We have more money in grant revenues budgeted for 26 and 25. So that is not a cost to the city. That is grant money. So the majority of that is coming from there. General fund is increasing, like I said, by the one and a half. Our parks fund is actually decreasing by $200,000 and our water fund is increasing by, And I am going to go into the general parks and water funds separately because those are our biggest operating funds. That's where most of the activity happens, the day-to-day activity. So I will go over those in more detail here in just a minute. Again, why are revenues increasing over $7 million? Mostly. $4.5 million of that $6.7 million, $4.5 of that is from workers. The biggest chunk is from grants. We have some new ones. We have a little more money coming in from the state, from the federal government that is not tax-related. Housing grants, park grants, road grants. Thank you, federal government. Thank you, state of Illinois. Is that what we're saying here? In most cases, there are state and federal grants. Is this promised or rejected? No, these are actually secured grants that are in the budget. Anything that's not secured is not better. So we probably could get more. We hope so. And to the other question on the general fund, why is it increasing? That is our operational fund. That covers our labor contracts, that covers our utilities, our light bill, everything that it takes to operate. I know you're going to go into this, but the only reason for the park decrease, because that looks out of place, is we moved facilities budgeting out of parks and back into the general fund where it's more appropriately located. Otherwise, it's proportional. And you saw this slide already, but I just thought it would be a good reminder. Taxes, 52% of our budget. That's where most of our money comes from for our revenues. And this, again, is all of our funds. Next we'll go into expenses, just a general overview, just like the revenues, I have the same funds up there. We're going from a $76.6 million budget, budgeted expenses in the current year to proposing an 80.7 million budget in 26. Again, if you look on the far right, you'll see the majority of the increase, what's 4.1 million increase, 3.2 of that is the other special revenue funds, along with just under a million dollars in the general fund. So that's where most of that comes from. Again, grant revenues and the other special revenue funds are revenue from, I should say, mainly from anticipated rates expenditures. Expenditures match revenues with grants, so it's about 4.5 million. Again, in grants, again, our parks and rec fund is decreasing, our water fund is increasing slightly, and our general fund is almost $2 million, but I will go over those three specifically here in just a moment. questions over the overall. And I did want to show you kind of like I did with the revenues. Now this again is all of our funds, but this is showing how our expenditures are distributed between various categories. Personnel takes up 46% of the budget and is by far the biggest chunk of our expenditure budget. We also have services are another 21% and then the rest is a lot less, and that includes, if you'll notice, our capital projects, that's only 9% of our budget, and I'll hit on that shortly as well. As I mentioned, personnel, that's a big chunk of the budget, and one thing I did wanna mention is we do have some kind of big changes. When I looked over personnel, our full-time salaries have increased by about 4% year over year. We've gone from about 19.5 to almost 20.3 in salaries. Our health insurance premium has gone up by almost the same overall dollar ounce, going from about 4.9 to 5.7. Health insurance premiums are going up for everybody. Ours are going up, we're estimating, possibly 17%. It might be less. That's what we know right now. We might have some... all the members here in the next month or so. On top of that our IMRF pension we had a it's not a huge dollar amount it's only about $166,000 but our IMRF pension rate did increase by about 14%. over here as well so overall if you take just those three items that's almost a 1.8 million dollar increase to the total budget with 74 of that hitting our general fund nine percent hitting water seven percent hitting the parks and six percent to public transit And this is just full-time salaries. Regular full-time personnel doesn't include our temporary employees. It's not in this one. Just because we looked at it, the city of Rock Island, which has a similar population, has over 450 employees. So we run a very lean... is pretty sharp. Right, right. you'll notice it's going down by 131,000 that's related to interest rates are going down so that's going to decrease the rest of the numbers on there the changes slight increases that's pretty much just all being adjusted based on history on the general fund. I also wanted to go over expenditures because we have quite a few different departments in the general fund. So those are all listed on the right. And if you'll notice on the little pie there, we have fire and police make up the biggest portion of our general fund expenses. It's about 66% that goes to public safety. Another big chunk is public works. And that includes like engineering, costs related to our fleet, stream bridge, maintenance repair, that sort of thing. So that's 11%. So about 75, 76% of the general fund budget just goes to those three areas. The rest is our community development, IT, it's finance, legal, HR, administration, city council. So that's what makes up those expenditures we're not expecting. Overall, a huge change in $70,000 overall. I think this is important though, right? This slide is important from that standpoint. Right, what are we gonna ask to do? People say respond to fire, try and fix infrastructure. 75 cents of every dollar is going to that. Everything else that the city does on the general fund side splits up to 25%. And obviously the public safety, which I think people support, so this isn't a negative, but relative to where the dollars are going, they're going to public safety and they're going into the operations to fix. Everything else is taking a percent or two at a time to try and operate the city. I'll tell you off the top of my head, I do know we are wanting to redo the ordinances. Oh, that was a shift. That was a shift from Parks to Mr. Gugliotta overseas building. That's not a big deal to me. We estimate revenues low and we expense high intentionally. So last year I think that number was several hundred thousand. Actually this year we actually tightened it up a little bit. But no, we believe this to be balanced. our salaries and benefits. And that's pretty much where a good chunk of the increase comes from. And then we have our services, we have our supplies and then we have what we call other charges. Now with the $431,000 increase in personnel services, a little skewed because of the public safety pension is included in there. Last year we budgeted the median. This year we're budgeting a little under the median. So that's throwing things off a little bit. But personnel service is actually increased by about 1.4 million in salaries and benefits that don't include the public safety. Once you throw the public safety in, that's what kind of brought it down to the $400,000 number there. Down in other charges is also the other pretty large expense, and that is related to our replacement programs, which includes our building repair and maintenance program, our computer replacement program, and our vehicle replacement program. And as you guys know, enterprise to lease vehicles, and that's brand new. We just got our first vehicles, I believe, in August. So we're still learning that, but one of the things we're doing through that whole process is we're trying to right-size our fleet. We're trying to make sure we're 100% funding on our replacement programs. So we make sure we're keeping up with the maintenance on our buildings. We're making sure all of our computers are, and all of our is good to go and not falling apart, same with the vehicles. So that's why that number is so high. The replacement programs are increasing, plus in the current year, 2025, we only funded our replacement programs at a 75% level. level. This year, we're funding them at a 100% level. So part of that equation is to put the council in a better position. Last year, some of you had to take a vote where we had deferred a lot of purchases because of COVID, and we spent almost $900,000 on these cars in one sales week. Fire trucks used to be $300,000 or $400,000. They're now $1.1 million. replace the fire apparatus. If you want a ladder truck, it's over $2 million, right? So the city, from my perspective and certainly recommendation, and I think shared by Ms. O'Hearn as well, we do not want to put the city in a position long-term where we're not accounting for those expenses because at the time when they need that equipment, they're going to need that equipment. So it's kind of a pay now or pay later, but We're trying to spread it out by fully funding it over a longer projection so that when the time comes we have those dollars to replace the equipment that needs to be replaced. And we're not buying how many of our squad cars we bought last year all at once, but rather just the same with public works trucks, the same with key equipment, the same with computer equipment. Longer term, that should take out the variability within the operation and prevent the council from having to make tough decisions like, hey, we have to have this, and we have to have revenue, and then you're basically forced into taxing some kind of an increase, unanticipated increase, when something goes wrong. So long-term, we think this is the right strategy. It's consistent with what I think a lot of other cities do, and I think will better position the city. And also, obviously, we don't need the fire truck right now. It's a big number. We don't need police cars right now. although interest rates are obviously a little bit lower, we can make interest off that money, put that back into the replacement, and ultimately over time start reducing the cost that's impacting our operations. So, yeah, obviously a bigger number, but part of it is just doing the correction to ensure the long-term the city's in a better position with its operations when the time comes. That's all I have on the general fund. Let's take a look at parks. Again, same story. Parks revenues mostly funded by taxes. 71% funded by taxes. They do receive some of the property tax. They receive some income tax. Sales tax, which also includes the home rule tax. They receive food and beverage tax. They also receive the hotel and hotel tax. Okay, so those are the different costs that they get a portion of. The other big chunk there, the use of money and property, that's related to the various programs, what is charged for people to participate or rent rentals for the golf course, for the campground, for all of those various facilities and programs. And as Mr. Hanson mentioned and mentioned a couple of times about transferring over, It was our city hall building and maintenance and our public safety building, the ground building, building and grounds, building and grounds for city hall and public safety building, moving that to the general fund. So that's what's causing some of that, some of that decrease there. So basically you think we're gonna have a new park, new park, we're gonna have new ball courts. We've got improvements to Custer. We have all these additions, as you were. And we think it's going to cost us more next year to operate all of that and maintain it. But, I mean, I understand that the decrease is based on a shift in some facilities, but I guess the general question is that we... I know the answer to that, but I don't want any response. Are we putting in the dollars necessary to keep those new facilities functioning and safe? Yes, so right, I mean, we've got multiple parks that now have new equipment. So obviously, they should last a while without maintenance. Cook is really the only one we added and It's 60 plus percent grant funded plus some additional support. We'll have to evaluate the one component to that park that may add a little laborious besides the mowing is obviously the splash pad. But obviously we operate wading pools and splash pads and some of those things. But the reality is, and I think I said this to council and some correspondents, we've invested north of $10 million in parks and parks-related facility. I would say next, well, in this budget also is the trail project around Lake Story is hopefully slated for 2026. And then another facility within the parks that we definitely have to look at besides the ongoing investment to keep the golf course going based on play is Lakeside, the Lakeside facility is in need of some love. If you've been out there, that's a bigger problem to solve and it's gonna take some more planning. It's not in the 2026, but it's something we're looking at projecting out in terms of dealing with the Lakeside as well. But the funds that are necessary to operate Cook, Lancaster, HT, We did some improvements at Ellen Custer. Obviously, we've done some improvements out at Hawthorne. Those are things that we pay for in part with grants and or with park funds and our facilities that hopefully will last a good time, including the courts over in Rotary Park as well. One thing that I see the golf course is going, getting reduction and stuff like that. I know you and I have talked, and I would say probably too, that the last place really at this point in time that hasn't seen some kind of major project, so to speak, is the golf course. And it's the one that's got the most use of all things and has went up in its use more than anything that we've had. We're going to have somewhere around 33,000 to 34,000 rounds of golf played in Bunker Lakes. And I know that we'll have to take a look at some grants and other things here, but I know there's some things that that at some point here down the line, because we've done things to all the other parks, but that's the one that, along with, as you said, Lakeside, has to be, I think, on our radar at some point in time here down the line. And one of the things that I thought, and this would pay for itself down the line, it really will, is a brand new, like, practice facility, not necessarily like Topgolf, but like Topgolf, and it'll get operated around, more months of the year, potentially at night with some other things and self-sufficient in terms of using coins, things like that. But those are some things that I think that I hope we look at here down the line at some point. Like a driving range. Yeah, because ours right now is not anything that is right on the top. So we have the facilities we have, it has eight bays to get reduced distance golf balls that, with high school kids, hit it anyway, older than that, and they're dangerous. So, I mean, it's something that I think, especially with the growth of golf right now, that I hope that we take a look at and see as something that's a real possibility. And just, and Jen and Tyler will correct me if I'm wrong, I think the reduction is only because last year we did the drainage project and the bridge project and the culvert project. Operationally, it's not a reduction in the operation. It's just there's some capital projects that last year were in the golf course. I think there was parking lot ceiling in there as well, which we actually did a fair amount at the golf course this year, but no doubt, right? I mean, you can see in... I don't know that we've got the revenue to that slide yet, but you'll see that the golf course generates... but it also generates the most revenue to offset the expense, relatively speaking. Only the campground actually breaks even, but in real dollars, the golf course generates almost a million dollars. And that wasn't a complaint. We've done these others, and now we're seeing people come in from all over. And that's the one area, and every time you're looking to improve anything you have, but that's an area that could really, really, really make a difference in all aspects of our golf experience here. Well, I think that's a great idea. And I'm the big proponent for sports and sports tourism, so. Just to be clear, are we talking about on-site or are we talking about off-site? Well, when I say on-site, there's some land nearby there that we can take a look at. It's recently been for Salem, and they beat for Salem in a 4-2-1. They could fit in there. At one point, I was talking about potentially putting it in the golf course, but that's crammed something in. It could rob Peter to pay Paul, so to speak, and cause more problems. No, no, no. So, you know, it's one of those things that we need to look at from another angle. But just talking to folks that have great knowledge about stuff like that, it could really... be a tremendous asset, grow things more, but also include or improve revenue too. Yeah, yeah, yeah. I agree. Thank you. Well, that's one of the things with the expenditures. They do look like they're going down quite a bit by 1.2. But again, you'll see the City Hall building and grounds and the PSB building and grounds, those are the ones that got moved. Those are $500,000 to $600,000 a year. So that's about half of it right there. In addition to that, a lot of the decreases are related to, like Mr. Hansen said, we did have some capital projects in there. And one of the things I'm trying to do is make this more operational and keep the capital projects with the capital projects funds. Because otherwise it does look like you're going up and you're going down. You're going up and you're going down. So to keep it more operational in this fund, whereas we can fund projects for the golf course, for anything parks related, some of our other capital funds. But some of the, also another chunk of the decreases here, and actually I'm gonna go to the next slide here, is related to personnel. One of the things is we have the vast majority of our temporary part-time employees work for parks, work in the summer, seasonal employees. In the past what we have done is we've budgeted those at like 100% thinking every facility's gonna be open every day. Everybody who's hired is gonna work every day for the full amount of time. And that's just, realistically that just doesn't happen. So we did a historical look back just to see what the actual costs were. And so some of those we were able to reduce in the budget. So that's also why you're seeing some of those decreases. And one other thing. I did wanna show the costs of our various facilities and programs, the revenues they bring in versus the expenditures. And again, all of these revenues and expenditures are related to the operations. So it doesn't include any capital expenses, anything like that. And the revenues are just the admissions, the rentals, all that type of stuff. So as you can see, about every program does cost more than we bring in, which again is why some of our property taxes go to fund that parts fund to help supplement the cost so we don't have to keep raising our costs and the citizens don't have to pay as much every time they go for admissions. And Jen, the point also that you made about this, these are all wonderful quality of life experiences that we keep costs, So they're reasonable. Again, speaking on behalf of the golf course, you're playing a round of golf out there for very, very small amounts of money compared to other places. And there's no way that we could ever charge the amount of money that would cost really to offset how much that would pay to operate this, or we would be pressing ourselves out of business. And that's true for all of those. So that's why those differences, and those differences aren't as stark as they really could be, because these aren't really quality of life things that citizens expect, that make a citizenry just have a better, better way of how they live. I'll just add one thing. Some of these facilities are underutilized. And so, if there are ways that we can increase membership participation, that would be a plus, right? We would increase revenues. Cost probably wouldn't change. Expenditures wouldn't change that much. The lights are on. The courts need to be played on, you know, kind of thing. And that could be for transportation, possibly. It could be through an advertising regimen. It could be through branding. There's lots of things that we might be able to create incentives. As we look forward to next year, it might be good to take a look at where the underutilization is. I don't know what the underutilization is at the campground. I sort of know a little bit about Lakeside because I use it more. whether it's being used or not when I'm there. So in the golf course, I mean, we've seen tremendous growth in that facility and usage. And I know it's almost like maxed out. I mean, there's a point. Yes, there really is a point. I don't know how you can grow any more in terms of the number of players. Right. And, I mean, just the number, you know, tremendous. Because I look, that's minus 151. I remember it was like minus 400. Yeah, and even more than that, it was on its way back where there was a discussion about the city potentially selling it on its way back because it was, and now this is just tremendous. So that's a good example of how other programs could mimic some of those activities or efforts. I know we're doing it with limited staff, so I'm not trying to put more work on the staff per se, but I think there's things that need this council to think about in that regard. Could you play a little golf? Have a little glow-in-the-dark ball? The last fund I'm going to go over, we're almost there, you guys, is the water fund. water fund so we have our revenues here obviously the vast majority comes from our utility billing so it comes from our sale of water and our facility fees that is 6.8 million of the 8.4 million dollar budget everything is staying fairly flat it's not increasing there's a three percent increase in total revenues at this time we weren't going to propose any increases to fees, no increases to the bills for anybody's utility bill. That's impressive, right? But let's it be said, the bill will still go up. It's still going to go up. And we need to explain to folks why we don't need to say it right now, but We anticipate when you get your bill, the water bill is proposed with three charges. So long. Let's say our portion, the city portion of the water bill for water service, we're not proposing any increases to that. We cannot speak to the sanitary district. And their rates don't change until March. First, I believe, is when their rates change. Mr. Hanson did a really great job when you came in talking about some of the large sales that we were making to other communities and how those were really out of line in terms of being fair or even make any sense in terms of business or citywide revenue. So I appreciate that and how you just covered all the bases for us. As far as, and just to highlight again, the sale of water and the facility fees, this is just comparing what's happened, what happened in 24 to what's happened so far this year. And it's fairly flat between the two. There's only a $354 difference in the water usage from year to year through August. Facility fees have gone up a little bit, but since 24, not that much. This year, if you remember, the city did a rate study a few years ago back. It had some recommendations. This last year was the last of the rate increases associated with that. And right now, not to get too far in, right, but our focus is on getting the PFAS out of the water. And so we're making progress on that front. Obviously, We've also received settlement money from 3M and the other, so the water fund balance is adequate and obviously making progress on the other in terms of you approved two additional test wells in August. We also tested a third well earlier this summer. They came back very positive. We hope those trends continue. We've got probably six, eight months left of studying on that before we are able to make some recommendations. And so right now, what this budget reflects on the water side is just kind of a holding pattern. At the point, we believe that if we have solutions to the PFAS situation, then we're going to focus on water loss in our pipe system, which is another challenge. But until then, you know, it's prudent to leave the rate where it's at and we'll continue pressing for it. And that's what's reflected in the water fund budget. And this is just a history of our water rate and the facility fee over the past couple of years. I'm just showing you that in 26 we're keeping everything the same. If we look at expenses, Our expenses are staying fairly flat as well. We're only going up $233,000. We're estimating about a 3% increase. Most of that's related to personnel services. It's actually $185,000 in salaries and 44,000 in benefits is really what's making up that increase in the water fund. That's all the fun stuff. Now I just have a couple more left because I want to kind of give you just a final big picture overview. As you saw at the beginning, total revenues are 76.3 million. I want to highlight operating revenues are 57 million of that 76 million. So the bulk of our budget of our revenues go towards or for operating purposes. We also have grants, we have a little bit to economic property development, we have some for debt, some for risk management, and then we also have our replacement and maintenance programs. So once you take all of those buckets that are already designated for various things, the amount remaining is about 4.1 million. That is the money we have, or you, I should say, as the council has, to decide what projects you want to do And that's if we don't use any kind of fund balance. So when you see these big numbers, $80 million, $90 million, $70 million, unfortunately, the bulk of it is already spoken for or used for operations. And we have a lot of needs and only 4.1 million at the end of the day to play around with. Same thing over, I just want to show the same thing on the expenses side. Expenses are a little higher, but again, operating expenses are almost 57 million of that $80 million budget. So operations are 66.1% of our proposed 2026 budget. I have this question. How can we be $4 million short when we still have $4 million left? What do you mean? I'm sorry. So if you take expenses versus revenues, we have a minus 4.4 million. Because those expenses include some of the capital projects that we already are proposing. So that 4.1 million is built in. Well, there's also fund balance in there, right? So if you go into the report, so as an example, we have in this budget the money that's left over for the community center. That's two and a half million dollars. Of the four point million gap, two and a half million dollars is that bond money that's budgeted. There's no new revenue because we're not issuing new bonds, but there's a two and a half million dollar expense on this side to account for that project. We have UDAG money that accounts that gets transferred over as part of our neighborhood cleanup initiative. That's that half a million dollars. There's carry over on the stormwater utility for stormwater projects. So as Jen said, there's some things that are already accounted for over on the expense side that are not on the revenue side because it's coming from fund balance rather than from revenue that's generated this year. But in the end, the broader point that this slide I think is trying to make a big picture is that when all is said and done, when we need to fix someone's ward's brook street or when we need to fix a facility or when we need to invest whatever it is, right? That we didn't anticipate or that we did anticipate, we just don't, we didn't have the fund. Like when all those capital things come together, of the revenue that is available, there's about four million left to do all of that. And that's the part that this slide is actually trying to say, is that operations, you know, you want a police force, there's a cost. If you want a fire department, there's a cost. If you want a parks department, there's a cost. Like all of those things are fixed costs that have to be accounted for, and then what actually gets split up It seems like a lot is not a lot of money. We just donated a million dollars to the Y. Right. Where did that money come from? Out of this? No, it came out of that community center bond fund. The visiting nurses are asking The money, what would that be? That would come out of the general fund. You're talking about the VNA? Yeah, VNA, yes. So it's not coming from that 4.1? It'll come out of the general fund. That 4.1? It'll come out of the 76 total that's available. It's budgeted already. Or at least 25,000 is what you said. So the VNA is... people may be listening. There's budget, there's 25,000 in it from the city and 25,000 from the township in the budget for 2026. Is this available? That's been discussed. Okay. Will we have to change the numbers in order to make it work? No. Okay. And what's the scope of school? Is that coming from that 4.1? We will get to that. I'm going to show you. I'm going to show you part of what that 4.1, part of what we have included as part of that 4.1. Yep, yep, yep. We're getting there. We're almost so close. Okay, so... As we mentioned before, we prepared the budget within the guidelines of the financial policies, meaning we have made sure we have a 30% fund balance going to be available in the general fund at the end of the year. We're gonna have a 5% fund balance in the parks fund at a minimum. We'll have more than that, but at a minimum. And we're required to keep 30% in the water fund as well. So with this budget, we do meet all those required financial policies. We're planning on, we're proposing to decrease the tax rates, the lowest rate the city has had since 2008. We do have some challenges ahead. As Mr. Hanson had mentioned, we have various infrastructure, roads, those type of challenges. I believe going forward, we are probably going to have some tax revenue challenges to the loss of the grocery tax, and I don't see the taxes increasing a whole lot over the long term. But those are just things to think about. And I also wanted to give you things that are new, things that are new, kind of bigger projects that we have put in and put in the 2026 budget and the proposed budget this year. Things that we have for annual maintenance, we budgeted about three point, almost $3.8 million for annual maintenance type of projects. This includes our vehicle replacement. We're gonna have 13 vehicles or large pieces of equipment that are going to be replaced. We're going to do some building repair maintenance projects, which are gonna include roofs, HVAC, flooring, Doors, some exterior masonry, resurfacing seal coating roads, over a million dollars. Some park maintenance projects and various park maintenance projects for 75,000. We have bunker-laced cart paths in there for 60, and we have almost a million dollars in demos in the budget right now. Yes? That one million for roads, is that in addition to our normal one million or so that we appropriated for that? Well, this is actually the construction, because part of that money actually goes to operations. So for pothole filling and just general maintenance, I think this is just the actual road investment. It's just motor fuel tax? Just motor fuel tax investment. There's other things operationally. This is the capital side of the large project for roads. We also have, as we talked about, $8 million in grant projects, which includes the brownfield assessment and cleanup grants. We have housing grants. We have Port Runway Rehab, Lake Story Path. We have the funds in there for the community center. We have body work cameras for the police, storm sewer improvements. We have the Cook Park splash pad in there for 325. So those are the grants we have in there currently that's almost $8 million. The community center. How do we get the 3.3 million? We have fund balance left over from the bonds. So we have that and then we have... Grants. State grants. Yeah, we have two different grants and then the remaining balance. It's essentially a million dollar grant from the feds and a quarter million dollar from the state plus the bond funds equals the 3.2 million. And then on top of that, we have some other capital expenses that are coming from some of the other capital funds, like our tax, like our community improvement and infrastructure funds. That includes the Starcom radio system for both fire and police. The public safety building, we're going to do the galvanized water line replacement. We're going to do an electrical upgrade at the public safety building. That's going to be split over two years. It's a fairly large project. We're going to do a demolition of... The terminal building at the airport and we're going to do the Perth Plaza stage is what we have in there currently. So just over $2 million. And again, these are just proposed. When is that going to be done? We'd have to bid that out. To bid it out, yeah. To bid it out, approved to bid it out during the next year. not being used. Is that the old place that you would have walked through the board on the way back? Back to the Ozark Fairlands. The Park Platinum stage, so is that a more permanent stage versus the one that you guys set up every summer? The one that got set up is no longer functional. It was a lower cost item, but it was not intended to be an outdoor stage. This is intended to be a longer lasting because it gets a lot of use. Park Plaza gets a lot of use. Can you say more about this radio system? How is that compared to what we have now? Starcom is required as part of the changeover on the bandwidth. Most cities are already there. This is I'll just say it's been deferred that it needs to be done. It's actually, we're opening the bid Wednesday. I believe, the bid opening is Wednesday for that. The public safety thing is a big split in part. Well, first of all, that building is built in the 1960s, I believe. 70s. 70s, 76, thank you. But the bigger issue is, right now, Right now, the generator only powers part of the building. And it's mainly the part that deals with 911. So if it goes down, the fire is dark, parts of the building are dark. The dispatch is obviously moving upstairs, which would mean that our entire police floor and fire floor would be dark because the generator only powers the dispatch center. So part of this project is to actually It's something that Mr. Lucerno over there told me that we had to do. Despite my best efforts to tell him no, he can miss. But no, I mean, obviously, it's a public safety building. It's got to function no matter what. And so our incident command is in there. Dispatch is in there for the whole county. Central Station is there. This is a long, long overdue project. overdue project. It's significant in expense, but it will serve us for a long time. And so obviously we're hopeful council will support it because it needs to be done. Doesn't it kind of put everybody on the same page? Well, there's obviously some inherent risks associated with it. So it's something we've been investing in that facility. in Central Station, in the police side, in the dispatch side, in the training center over the last two or three years, but this is a good one to make sure that we have adequate power should the power go out. And as it turns out, the power does go out from time to time. Stop picking on Amber. That's all I have. Thank you for your efforts. That's it. Really, thank you. Thank you for your efforts. No, thank the departments. They're the ones who put everything together. They get all their projects together. They prioritize everything. They just have to listen to me, tell them no, so I appreciate it. They don't get too mad at me, to my face. I'm just surprised Eric stayed awake through the whole thing. No. This is one of the questions. I mean, obviously, we put a lot of emphasis on policy. that should be planned and such? And you want to state the number, but could we, what are we looking at in terms of dollars that could be applied to that effort next year? You know, I would look at housing like this. You know, housing is likely coming out of one of two places. Structure support project or B, through the development fund. You know, understand you know, budgets are fluid documents, right? And while we're hopeful of certain things to happen, we didn't just place random dollars in for things that we didn't know. So, you know, I mean, what I would say to council on pieces like that, no different than some of the economic development projects that came along that we didn't anticipate, you know, that's when we come to council and ask not only for an adjustment, you know, provide where the funds are going to come from, and then ask for the budget adjustment to support it as part of the action that would come before council and I try to keep council always abreast of that as we go through the year. So if we found the right project, if it's downtown, it's likely gonna incorporate some combination of TIF and fund 24 potentially and or the general fund. If it's out somewhere else, it could incorporate other funds as well. Obviously not in here, but as a fair question, we are making progress on the logistics park project as we've discussed. We've discussed it publicly. That is not in here because we don't have a complete agreement, but we're definitely making progress. And so there'll be a budget adjustment related to that revenue as well, as well as grants that we're actively working on that should those dollars become available, that will adjust too. We think this encapsulates or certainly captures the vast majority of what we expect to happen operationally, what we expect to happen in terms of known grants, in terms of known capital projects. But in the end, some of those variable things that are more, I guess, targets that we're working towards are likely to come through with budget adjustments. But I think we're well-positioned. We have the fund balances well-positioned. Ms. O'Hearn and her staff and all the departments just do an excellent job of managing their resources and making sure that we have the opportunity to capitalize on those things when we need to. And I think this year, I mean, we've proven, you know, with just some of the development initiatives, whether it's with Western Spoke House or Graham or what have you, right? You know, you all have taken votes on incentive packages that have created literally hundreds of jobs out of, you know, Fund 24 as the time came. So we would anticipate taking that approach going forward. Any other questions? Did we worry you out? Looks like we won. Mission accomplished. When we're done, I hope to ask for a motion to adjourn. Salute. Second? Second. All those in favor, say aye. Aye. Anyone want to stay here longer? Do I have to go out there and do it again? So we are peaceful for the night. You guys will be safe on your way home.