Sep 30, 2024 City Council Special Meeting

[00:00:05]

EVERYTHING'S UP AND RUNNING AND WE'RE LIVE AND SO WE'RE GOING TO GO AHEAD AND CALL OURSELVES TO ORDER HERE TODAY.

[1. Call to Order]

AND SO I AM GOING TO GO AHEAD AND ASK IF COUNCILMAN SHERWIN WOULD OPEN US IN PRAYER, AND THEN WE'LL HAND IT RIGHT OVER FOR PUBLIC COMMENT.

YOU GUYS, PLEASE RISE.

LET US PRAY. OH, HEAVENLY LORD GOD, OUR FATHER IN HEAVEN.

WE, FATHER, WE COME BEFORE YOU TODAY DOING YOUR WORK HERE IN THIS PLACE AND AT THIS TIME.

FATHER, WE PRAY THAT AS WE DELIBERATE THESE ISSUES FOR THE CITY, THAT YOU WOULD GIVE US THE WISDOM WE NEED, THAT YOU WOULD LEAD US, THAT YOU WOULD GUIDE US, THAT YOU WOULD TELL US THE THINGS WE NEED TO KNOW.

FATHER, WE PRAY, ESPECIALLY THAT WE LISTEN TO YOU.

THAT WE FOLLOW YOUR LEAD, THAT WE WORK YOUR WILL, NOT OURS.

FATHER, WE, ALL OF US HERE THAT YOU WOULD BLESS US, THAT YOU WOULD GIVE US YOUR LOVE AND YOUR FREEDOM FATHER. FOR WE ARE FREE THROUGH YOU, FATHER GOD.

NOW WE PRAY BEFORE YOU.

WE ASK FOR YOUR FORGIVENESS.

THESE THINGS WE PRAY IN THE NAME OF YOUR SON, JESUS CHRIST, THE KING OF KINGS AND THE LORD OF LORDS.

AMEN. AMEN.

THANK YOU. GUYS, PLEASE BE SEATED.

HEY, WE APPRECIATE YOU, COUNCILMAN.

THANK YOU FOR GETTING US STARTED RIGHT.

YOU WANT TO DO THE PLEDGE COUNCILMAN? WE DIDN'T LIST THE PLEDGE.

OKAY. ON THIS ONE, WILL WE TRUST THAT YOU'VE ALL PLEDGED ALLEGIANCE TO THE FLAG THIS MORNING BEFORE YOU GOT UP? SO JUST JOKING.

[2. Public Comment]

TAKE US THROUGH PUBLIC COMMENT.

THANK YOU, MAYOR.

THANK YOU FOR PARTICIPATING IN TODAY'S CITY COUNCIL MEETING.

YOUR INPUT AND YOUR OPINIONS ARE IMPORTANT, AND WE'RE GLAD THAT YOU'RE HERE TO SHARE THEM TODAY.

AT EACH POSTED MEETING, WE INVITE OUR FELLOW COMMUNITY MEMBERS TO ADDRESS CITY COUNCIL REGARDING POSTED AGENDA ITEMS OR TOPICS RELATED TO CITY POLICY.

EVERY SPEAKER TODAY WILL HAVE THREE MINUTES TO ADDRESS THE COUNCIL.

AT THE END OF 2.5 MINUTES, A WARNING BEEP WILL SOUND TO ALERT YOU.

YOU HAVE 30S LEFT TO WRAP UP YOUR THOUGHTS.

WE DO HAVE MULTIPLE PUBLIC HEARINGS TODAY.

IF YOU'RE HERE TO SPEAK ON AN ITEM WITH A PUBLIC HEARING, WE WOULD ASK THAT YOU MAKE YOUR COMMENT EITHER DURING THE PUBLIC HEARING OR DURING PUBLIC COMMENT, BUT NOT BOTH, IN ORDER TO HELP US KEEP ACCURATE MINUTES.

IT'S YOUR DECISION AT WHICH TIME YOU WOULD LIKE TO SPEAK.

WHEN YOU COME TO THE MICROPHONE TODAY, PLEASE STATE YOUR NAME WHETHER OR NOT YOU LIVE IN THE AMARILLO CITY LIMITS, AND THEN YOU MAY BEGIN ADDRESSING COUNCIL.

AS A REMINDER, IF YOU'RE HERE TO ADDRESS COUNCIL ON SOMETHING THAT IS NOT ON THE AGENDA TODAY, THEY ARE LIMITED IN HOW THEY CAN INTERACT WITH YOU ON THAT ITEM.

THEY CAN STATE, EXCUSE ME, THEY CAN GIVE A STATEMENT OF POLICY OR FACT.

THEY CAN REFER IT TO A FUTURE AGENDA, OR THEY CAN REFER YOU TO STAFF TO HELP ADDRESS YOUR ITEM.

FIRST, TODAY WE'VE GOT MIKE FISHER AND ON DECK AFTER MR. FISHER WILL BE JOHN ADAIR.

GOOD MORNING, SIR.

GOOD MORNING. YOU KNOW, I'VE GOT THIS MIKE FISHER.

I'M AT 4410 VAN KRISTEN, AND I'VE GOT A SUGGESTION, AND I THINK WE BROUGHT IT UP BEFORE THAT LOOK INTO THE HOUSTON THE WAY HOUSTON DOES THEIR PUBLIC COMMENT. IF YOU REGISTER BEFORE THE THREE DAY CUT OFF TIME OR WHATEVER IT IS, THEN THAT PERSON'S AGENDA GETS ON THE AGENDA.

IT DOESN'T MEAN YOU HAVE TO TALK TO THEM, BUT YOU CAN TALK TO THEM SO YOU CAN STILL NOT TALK TO THEM AND SO I THINK THAT'D BE A GREAT WAY TO DO THIS, ESPECIALLY IF SOMEBODY'S TAKEN OFF TIME FROM THEIR DAY AT WORK.

BECAUSE IF YOU GUYS PUT IT ON THE AGENDA, THEN THEY'VE GOT TO TAKE ANOTHER DAY OFF TO COME UP HERE AND I THINK IT COULD HELP MAKE SOMEBODY GO AWAY AS I PUT IT IN THE LAST MEETING. I'M HERE TODAY TO TALK ABOUT THE ADC BUDGET AND I CAN TELL YOU I'M NOT AGAINST THEM.

I'M AGAINST THEM THE WAY THEY RUN TODAY.

I WON THE ENTERPRISE CHALLENGE ABOUT 15 YEARS AGO.

75 GRAND. I TURNED THAT INTO A MILLION BUCKS ON A MEDICAL SOFTWARE COMPANY, THAT TEXAS TECH USES MY SYSTEM.

THE WYATT CLINIC USES MY SYSTEM.

PARKLAND HOSPITAL IN DALLAS USES MY SYSTEM.

THE ENTIRE STATE OF KENTUCKY USES MY SYSTEM.

I'VE HELPED SAVE THE COUNTRY AND THE MEDICAL INDUSTRY OVER $4 BILLION AND I CAN PROVE IT.

IT'S NOT EVEN THAT'S A SMALL CONSERVATIVE NUMBER.

[00:05:03]

THAT'S WHAT IT'S EVOLVED, NOT SOME LITTLE GUY IN HIS GARAGE RUNNING HIS SOFTWARE BUSINESS.

NOW IT'S HOW DO THE BANKERS OVER HERE GET RICHER? AND IT'S PRETTY OBVIOUS.

I'M SURE YOU GUYS HAVE BEEN CALLED INTO MEETINGS WHERE THE WARES ARE SITTING IN THE BACKGROUND AT THE UNDERWOOD LAW FIRM.

AND, YOU KNOW, SOME OF THE THINGS THAT KEVIN CARTER TALKED ABOUT LAST WEEK, A $50,000 LIMITATION.

I MEAN, CAN YOU THEY CAN STILL DO THE SAME THING THAT THEY DID WITH THE RANGE.

NOW THEY JUST HAVE TO CUT THEM A CHECK EVERY MONTH FOR 20,000.

NOW YOU GOT YOUR QUARTER MIL.

AND NOBODY HAS TO APPROVE IT.

THE DEAL WITH THE RANGE, YOU'VE GOT JASON HERRICK, WHO'S THE PRESIDENT OF THE RANGE, WHO WAS ALSO THE PRESIDENT OF AMARILLO MATTERS.

JASON HERRICK ALSO GOT THE ENTERPRISE CHALLENGE, THE SAME ONE I WON.

THE SAME ONE THAT I HAD, THE GARAGE BUSINESS THAT'S HELPING SAVE BILLIONS OF DOLLARS.

BUT JASON HERRICK'S COMPANY DIDN'T EVEN HAVE AN ADDRESS.

DOESN'T HE, STILL DOESN'T EVEN HAVE A WEBSITE.

TO THIS DAY, HE HAS A FOREIGN REGISTERED LLC, NO VIABLE BUSINESS, AND HE WON THE $99,000 ENTERPRISE CHALLENGE, THE SAME ONE I DID.

HOW MUCH MONEY IS HE BRINGING INTO THIS TOWN LIKE MY BUSINESS? I WISH THEY WOULD GO BACK TO WHAT THEY ORIGINALLY WERE INTENDED FOR, WAS TO ROLL THE DICE ON SMALL ENTREPRENEURS LIKE ME THAT COULD TURN IT INTO MILLIONS, WHICH IS WHAT I'VE DONE.

THANKS FOR YOUR TIME. APPRECIATE YOU MIKE.

THANK YOU, JOHN ADAIR.

ALL RIGHT. MY NAME IS JOHN ADAIR.

I'M PROUD TO LIVE IN CITY LIMITS OF AMARILLO.

THERE'S BEEN A LOT OF DISCUSSION ON THE EEDC DEBACLE.

I BELIEVE THE SERIOUSNESS OF THIS HAS BEEN DOWNPLAYED.

THERE ARE SEVERAL ISSUES ON THIS I'D LIKE TO ADDRESS.

I ATTENDED THE COUNCIL MEETING LAST WEEK, AND COLE STANLEY SAID THAT THIS COMES DOWN TO A WIRE TRANSFER.

THIS TELLS ME A CITY EMPLOYEE MADE THIS WIRE TRANSFER.

WE WOULDN'T BE HERE IF THIS CITY EMPLOYEE HAD PROPERLY ANSWERED THREE SIMPLE QUESTIONS.

WHERE IS THIS MONEY GOING? WHAT IS THIS MONEY FOR? AND DID THE CITY COUNCIL APPROVE THIS EXPENDITURE? THREE SIMPLE QUESTIONS WOULD HAVE PREVENTED ALL OF THIS.

THIS TELLS ME EITHER A PERSON WAS COMPLETELY INCOMPETENT IN THEIR JOB, OR THIS PERSON WAS HOPING THIS WOULDN'T BE NOTICED.

EITHER WAY, I BELIEVE WE NEED TO SEE SOME ACCOUNTABILITY TAKEN FOR THIS.

THIS COUNCIL TALKED ABOUT DOING A THREE YEAR LOOK BACK AND AUDIT BY AN OVERSEEING BODY.

THIS COUNCIL HAS DISCUSSED WHAT THAT WOULD LOOK LIKE, WHAT EXPENDITURES AND WHAT AMOUNTS THEY WOULD WANT TO SEE.

I WOULD LIKE TO ADD TO THAT, THAT THIS COUNCIL HAVE THEM TURN OVER ALL REIMBURSEMENTS AND RECEIPTS FOR, FOR THOSE REIMBURSEMENTS. LASTLY, I WOULD LIKE A LITTLE CLARIFICATION ON WHAT IS THE RANGE.

I KNOW COLE SAID IT WAS A UNIQUE ACRONYM, BUT WHAT IS IT? WHAT DOES IT DO? HOW MANY JOBS DOES IT PROVIDE TO THIS COMPANY? THE JOB OF THE EDC IS TO BRING IN BUSINESSES THAT WILL PROVIDE JOBS AND PRODUCE GOODS AND SERVICES THAT WILL BENEFIT THIS COMMUNITY.

IF THE RANGE DOESN'T DO THIS, WHY ARE WE GIVING THEM ANY MONEY? THANK YOU, THANK YOU, THANK YOU, MR. ADAIR. AS A STATEMENT OF FACT, YOU, NEIL GERBER, SHOULD HAVE PRELIMINARY DRAFT OF ALL OF THE THREE YEAR LOOK BACK THIS FRIDAY.

SO COUNCIL WILL BE RECEIVING THAT LOOKING AT THAT OVER THE WEEKEND.

AND THEN NEXT WEEK, HOPEFULLY BE IN A POSITION TO ANALYZE THAT.

HE ALSO HAS TAKEN THE REIMBURSEMENTS FROM THE EMPLOYEES.

SO HE'LL BE ABLE TO TELL YOU WITH SUPPORTING DOCUMENTATION WHAT MONIES WERE EXPENSED.

WE DON'T KNOW THAT THAT'LL BE READY ON FRIDAY.

BUT WE DO KNOW THAT HE'S LOOKING INTO THAT AND A FEW OTHER THINGS AS WELL.

AND THEN WE ARE TAKING OUR ROLE IN OVERSIGHT VERY SERIOUSLY IN THIS.

AND WE'LL CONTINUE TO WALK THIS OUT THE RIGHT WAY.

[00:10:01]

MAYOR, THAT CONCLUDES EVERYONE THAT SIGNED UP.

OKAY. DO I HAVE ANYONE ELSE HERE WHO'D LIKE TO OFFER PUBLIC COMMENT BEFORE WE PROCEED WITH OUR MEETING? OKAY. MOVING ON, WE'LL GO AHEAD AND GET INTO OUR AGENDA ITEMS.

[3.A. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8157]

SO THESE ARE ALL OF OUR PIDS.

AND SO WE HAVE MISS CARRIE ROBERTS HERE TODAY.

SO WE WON'T ASK YOU TO COME UP AND GIVE A PRESENTATION.

YOU DID A GREAT JOB PREVIOUSLY IN EXPLAINING TO US AGAIN AND OUR PUBLIC WHAT A PID IS, WHY YOU KNOW, HOW IT'S HOUSED, WHAT IT FUNCTIONS FOR.

COUNCIL, IF YOU HAVE ANY SPECIFIC QUESTIONS ON ANY OF THESE ITEMS MISS ROBERTS CAN ANSWER THOSE, BUT WE WILL WE WILL GO AHEAD AND MOVE FORWARD WITH THESE EFFICIENTLY. SINCE WE THIS IS THE SECOND AND FINAL READING.

SO COUNCIL AT THIS TIME, ARE THERE ANY QUESTIONS ON ANY OF THE PIDS THAT ARE NOTICED HERE TODAY FOR MISS CARRIE? NO, SIR. NO.

OKAY. SO WE'RE GOING TO GO AHEAD AND MOVE THROUGH WITH THE PROCEDURAL PART OF THIS.

SO ITEM THREE A IS READY FOR A MOTION.

OH. I'M SORRY. ITEM THREE A IS UP FOR A PUBLIC HEARING.

DO I HAVE ANYONE HERE THAT WOULD LIKE TO SPEAK FOR OR AGAINST ITEM THREE A? SEEING NO ONE WILL CLOSE THE PUBLIC HEARING AND NOW CALL FOR THE MOTION.

I MOVE TO ADOPT ORDINANCE NUMBER 8157 AS PRESENTED.

SECOND, I HAVE A MOTION AND A SECOND FROM PLACE TWO.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? ITEM PASSES WITH A 4-0 VOTE.

ITEM 3B WE HAVE THIS ONE IS THE PID FOR HERITAGE HILLS.

[3.B. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8158]

SEEING NO ONE WILL CLOSE THE PUBLIC HEARING AND WOULD ASK FOR A MOTION.

MOVE TO ADOPT ORDINANCE NUMBER 8158 AS PRESENTED.

SECOND. MOTION AND A SECOND ON 3B.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? MOTION PASSES.

WE'LL MOVE FORWARD TO ITEM 3C.

[3.C. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8159]

DO I HAVE ANYONE HERE? WE WILL NOW OPEN A PUBLIC HEARING.

DO I HAVE ANYONE HERE THAT WOULD LIKE TO SPEAK FOR OR AGAINST THIS ITEM? SEEING NO ONE WILL CLOSE THE PUBLIC HEARING AND WOULD ASK FOR A MOTION.

I MOVE TO ADOPT ORDINANCE NUMBER 8159 AS PRESENTED.

SECOND. MOTION AND A SECOND ON ITEM 3C.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? ITEM PASSES 4-0 VOTE.

MOVING ALONG TO ITEM 3D.

[3.D. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8160]

WE WILL NOW OPEN A PUBLIC HEARING ON THIS ONE.

DO I HAVE ANYONE HERE THAT WOULD LIKE TO SPEAK FOR OR AGAINST ITEM 3D.

SEEING NO ONE, WE'LL CLOSE THE PUBLIC HEARING.

WOULD ASK FOR A MOTION.

MOVE TO ADOPT ORDINANCE NUMBER 8160 AS PRESENTED.

SECOND. MOTION AND A SECOND ON ITEM 3D.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? MOTION PASSES.

MOVING ON TO ITEM 3E.

[3.E. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8161]

WE'LL NOW OPEN A PUBLIC HEARING.

DO I HAVE ANYONE HERE TO SPEAK FOR OR AGAINST ITEM 3E? SEEING NO ONE WE'LL CLOSE THE PUBLIC HEARING.

WOULD ALLOW US TO MOVE.

MOVE TO ADOPT ORDINANCE NUMBER 8161 AS PRESENTED.

SECOND. I HAVE A MOTION AND A SECOND.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? MOTION PASSES.

ITEM 3F.

[3.F. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8162]

WOULD NOW OPEN A PUBLIC HEARING ON ITEM 3F.

DO I HAVE ANYONE HERE WHO WOULD LIKE TO SPEAK FOR OR AGAINST THIS ITEM? SEEING NO ONE, WE WILL CLOSE THE PUBLIC HEARING AND WOULD ASK FOR A MOTION.

MOVE TO ADOPT ORDINANCE NUMBER 8162 AS PRESENTED.

SECOND. I HAVE A MOTION AND A SECOND.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? ITEM THREE F PASSES.

MAYBE WE SHOULD START SCHEDULING OUR MEETINGS BEFORE LUNCH MORE OFTEN.

WE SEEM MOTIVATED.

[3.G. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8163]

WE'LL OPEN A PUBLIC HEARING ON THIS ITEM.

DO I HAVE ANYONE HERE WHO WOULD LIKE TO SPEAK FOR OR AGAINST ITEM THREE G? SEEING NO ONE, WE'LL CLOSE THE PUBLIC HEARING.

WOULD ASK FOR A MOTION.

MOVE TO ADOPT ORDINANCE NUMBER 8163 AS PRESENTED.

SECOND. ONCE AGAIN, A MOTION AND A SECOND.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? ITEM PASSES.

[00:15:02]

[3.H. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8164]

DO I HAVE ANYONE HERE WHO WANTS TO SPEAK FOR OR AGAINST THIS ITEM? SEEING NO ONE WE'LL CLOSE THE PUBLIC HEARING.

WOULD ASK FOR A MOTION.

MOVE TO ADOPT ORDINANCE NUMBER 8164 AS PRESENTED.

SECOND. MOTION AND A SECOND ON 3H.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? MOTION PASSES.

I THINK THIS IS OUR LAST ONE.

ITEM 3I IS OUR COLONY'S BID.

[3.I. PUBLIC HEARING AND CONSIDERATION OF ORDINANCE NO. 8165]

DO I HAVE ANYONE WHO WOULD LIKE TO SPEAK FOR OR AGAINST ITEM THREE I.

SEEING NO ONE WILL CLOSE THAT PUBLIC HEARING.

WOULD ASK FOR MY LAST MOTION.

MOVE TO ADOPT ORDINANCE NUMBER 8165 AS PRESENTED.

SECOND. MOTION AND A SECOND.

ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? MOTION PASSES.

MISS ROBERTS, GREAT JOB ON LEADING US THROUGH THAT.

APPRECIATE YOU BEING EFFICIENT.

OKAY. WE WILL MOVE ON TO ITEM 3J.

[3.J. CONSIDERATION OF RESOLUTION NO. 09-30-24-1]

WE HAVE THIS IS OUR ECONOMIC DEVELOPMENT CORPORATION AND THEIR BUDGET.

AND SO AT THIS TIME, I WANTED TO DEFER OVER TO MR. PATH AND SEE.

MR. PATH, DID YOU WANT TO PRESENT SUGGESTIONS OR WOULD YOU LIKE TO HAVE MR. CARTER MAYBE GO BACK THROUGH WHAT THE ORIGINAL BUDGET IS IN A REVIEW.

I'M READY TO GO IF THE COUNCIL WOULD LIKE ME TO GO FIRST.

BUT OTHERWISE, IF YOU'D LIKE TO TALK FROM THE ORIGINAL, IF YOU'D LIKE TO TAKE THE ORIGINAL FIRST AND THEN GO FROM THERE, THAT MAY MAKE SENSE AS WELL.

SO I ACTUALLY DO THINK IT WOULD BE BETTER TO START WITH YOU, BECAUSE WE ARE VERY FAMILIAR WITH THE BUDGET AND HAVE WORKED THROUGH THIS ONE ALREADY.

I THINK WE WOULD DO BEST IN HEARING WHAT STAFF RECOMMENDATIONS ARE FIRST, AND THEN I THINK WE WOULD HAVE MR. CARTER MAYBE TAKE US BACK THROUGH THAT, AND THEN HE COULD LEND AN OPINION TO WHAT STAFF'S RECOMMENDATIONS ARE.

AND THEN ALSO, I'LL LET YOU GUYS KNOW WE HAVE MR. HYDE ON THE ON THE CALL HERE.

AND AND HE'S ABLE TO WALK US THROUGH AN ALTERNATE THAT WE'VE BEEN DISCUSSING AS WELL.

ABSOLUTELY. YES. MAYOR, MEMBERS OF COUNCIL APPRECIATE THE OPPORTUNITY TO COME AND PRESENT THIS TO YOU.

AS WE DISCUSSED AT THE LAST COUNCIL MEETING, ACTUALLY GOING BACK A COUPLE OF COUNCIL MEETINGS, THE CITY COUNCIL WAS PRESENTED THE EDC BUDGET.

THE ORIGINAL VERSION.

WE'VE TAKEN THAT BUDGET AND OF COURSE WE PUT THAT INTO OUR SOFTWARE.

SO YOU HAVE IN YOUR PACKETS SOMETHING THAT LOOKS SIMILAR, SIMILAR TO THIS.

THIS IS IN THE CITY SOFTWARE.

THAT'S HOW WE BREAK IT DOWN. IT'S HOW WE SHOW OUR SHEETS.

SO WITH THIS, THE COUNCIL DISCUSSED DIFFERENT OPTIONS FOR HOW TO APPROVE THEIR BUDGET.

OF COURSE, OBVIOUSLY YOU CAN APPROVE IT AS PRESENTED BY THE EDC.

YOU CAN YOU CAN NOT APPROVE A BUDGET IF YOU SO WISH.

WE DID DETERMINE THAT THAT YOU'RE NOT REQUIRED TO APPROVE A BUDGET TODAY BEFORE OCTOBER 1ST.

YOU CAN ALSO APPROVE A BUDGET WITH CONDITIONS.

AND SO AS STAFF, WE WENT TO WORK TRYING TO IDENTIFY SOME POTENTIAL CONDITIONS SHOULD YOU WISH TO CHOOSE THOSE.

BUT WITH THIS CITY COUNCIL, YOU CAN CHOOSE WHATEVER CONDITIONS YOU WISH.

YOU CAN TAKE WHAT WE PRESENTED, YOU CAN TAKE WHAT MR. HYDE PRESENTED. YOU CAN TAKE ANYTHING THAT YOU SO DECIDE.

AND SO IT IS OPEN TO YOU TO DECIDE.

SO WITH THIS CITY STAFF, WE DID LOOK AT SOME OPTIONS FOR YOU TO CONSIDER.

AGAIN THESE ARE JUST OPTIONS.

THIS IS NOT WHAT WE SAY. YOU HAVE TO DO.

JUST IDEAS. HERE IN YOUR PACKET YOU WILL SEE A SHEET THAT LOOKS LIKE THIS.

THIS IS THE FIRST PAGE THAT HAS FOUR WRITTEN OUT RECOMMENDATIONS THAT WE HAVE MADE.

THESE WERE THE CONDITIONS THAT WE VERBALIZED TO YOU AT THE LAST MEETING.

WE PUT THEM IN WRITING NOW AND FOLLOWING THAT YOU WILL SEE THE BUDGET SHEETS THERE THAT HAS YOU SEE A LITTLE, LITTLE BLUE NUMBERS ON THE TOP.

THERE ARE ONES, TWOS, THREES AND SO FORTH LIKE THAT.

SO WE WILL BE REFERRING TO THOSE AS WE GO ALONG WITH THIS STAFF.

AND WE DID LOOK AT THEIR AT THEIR ACTUAL HISTORY.

WE LOOKED AT THEIR BUDGET PROPOSALS.

AND SO WITH THIS GOING TO NUMBER ONE, OUR FIRST, OUR FIRST SUGGESTION FOR A POSSIBLE RECOMMENDATION FOR CONDITION WITH THE BUDGET WOULD BE APPROVE THE 91100 SECTION, WHICH IS THEIR AMARILLO ECONOMIC DEVELOPMENT OPERATING BUDGET AS PRESENTED TO ALLOW EDC TO CONTINUE CONDUCTING THE DAY IN AND DAY OUT PARTS OF THE BUSINESS WITH THIS.

THIS IS SECTION 91100.

SEE LITTLE NUMBER ONE ON THE TOP THERE.

THIS IS WHERE YOU'LL FIND THEIR PAYROLL, THEIR OFFICE EXPENSES, THEIR RENT FOR THEIR BUILDING, UTILITIES, AND SO FORTH.

THEIR BUDGET IS ABOUT 1.85 MILLION 7,676% OF ITS PAYROLL.

SO THAT'S A BIG CHUNK OF THAT.

THE REST OF IT IS JUST TYPICAL OFFICE EXPENSES THERE.

I SEE YOU THERE. NOW, WITH THIS LOOKING AT THEIR HISTORICAL FIGURES, WHAT THEY PROPOSE IN THE BUDGET DOES SEEM TO TREND CORRECTLY VERSUS HISTORICAL NUMBERS THERE.

SO I DIDN'T DIG ANY DEEPER TO SEE WHETHER THE BUDGET NUMBERS LOOK GOOD OR NOT.

BUT IT DOES. IT DOES TEND TO TREND IN ACCORDANCE WITH WHAT THEY PRESENTED.

THE NEXT RECOMMENDATION FOR YOU TO CONSIDER IS UNDER SECTION UNDER THE ACCOUNT 91110.

[00:20:04]

WE RECOMMEND THAT YOU APPROVE THIS SECTION AS PRESENTED WITH NO ACCOUNT LINE ITEM TO EXCEED THE APPROVED BUDGET WITHOUT PRIOR AUTHORIZATION FROM THE COUNCIL, AND NO SUBCATEGORY WITHIN EACH ACCOUNT LINE AS SHOWN IN EXHIBIT A TO BE OVERSPENT BY 25% OR MORE WITHOUT PRIOR COUNCIL AUTHORIZATION.

SO YOU WILL SEE IN YOUR PACKETS, YOU WILL SEE THE SHEET THAT SAYS LIKE THIS IS NUMBER TWO.

THIS IS 91110.

THEN YOU WILL SEE EXHIBIT A WHICH IS A LITTLE MORE BROKEN OUT.

AND SO YOU'LL SEE IN THE EXHIBIT A, THE FAR RIGHT HAND SIDE, YOU'LL SEE THE ACCOUNT NUMBERS WHICH YOU'LL SEE A MARKETING SUPPORT $150,000 MARKETING TECHNOLOGY AND SOFTWARE 45,000 ALL THE WAY DOWN TO WORKFORCE INITIATIVES, $60,000, FOR A TOTAL OF $800,000.

OUR RECOMMENDATION FOR YOUR CONSIDERATION IS THOSE NUMBERS DO NOT CHANGE WITHOUT YOUR APPROVAL.

IF YOU MOVE TO THE LEFT, THERE YOU SEE THE SUBCATEGORIES.

THIS IS WHERE THEY BREAK THOSE NUMBERS INTO SMALLER NUMBERS THERE.

AGAIN, LOOKING AT MARKETING SUPPORT YOU'LL SEE PAID MEDIA 35,000.

WEBSITE 10,000.

PHOTOGRAPHY FOR PRINT AND WEB 5000.

THESE ARE A LOT OF THESE WERE APPEARS TO BE TYPICAL CONTRACTUAL OR OFFICE RELATED EXPENSES.

SO THESE ONES HERE ARE SUGGESTING IS THESE.

THESE ARE ALLOWED TO FLUCTUATE BY NO MORE THAN 25% WITHOUT YOUR APPROVAL.

THAT WAY, THEY HAVE ROOM TO MANEUVER WITH AND WITHIN THAT TOTAL ACCOUNT CATEGORY.

AGAIN, THE CATEGORY WOULD NOT EXCEED, BUT THEY HAVE ROOM WITHIN THOSE ITEMS THERE TO ADJUST THAT THEY IF THEY NEED IF CONTRACTS CAN BE A LITTLE HIGHER, A LITTLE LOW.

SO THAT IS THE SECOND RECOMMENDATION THAT WE'VE MADE.

AND PLEASE STOP ME ALONG THE WAY IF YOU HAVE QUESTIONS.

MOVING ON, LOOKING AT RECOMMENDATION NUMBER THREE.

THIS GETS TO THEIR SECTION.

THIS IS ACCOUNT NUMBER 91120, WHICH IS THE TPRDC OR THE TEXAS PANHANDLE REGIONAL DEVELOPMENT CENTER.

THESE AGAIN, ARE OPERATING EXPENSES THAT ARE MOSTLY PASS THROUGH.

SO WE RECOMMEND APPROVAL OF THESE AS PRESENTED.

AGAIN THOSE BEING OPERATIONAL EXPENSES TIED TO TPRDC.

THEN LASTLY THIS ONE'S A LITTLE MORE COMPLICATED BUT MOST OF THEIR LOOKING AT SECTION ACCOUNT NUMBER 91200.

THIS IS THE ADC PROJECTS BUDGET.

THE VAST MAJORITY OF THESE ARE TIED TO CONTRACTUAL EXPENSES, LIKE WHETHER IT'S INDUSTRIES, THINGS THAT YOU'VE ALREADY APPROVED OR PRIOR COUNCILS HAVE APPROVED THROUGH CONTRACTS. SO THOSE NUMBERS ALREADY SHOULD HAVE SHOULD ALREADY HAVE SET TERMS TO BE SPENT.

THERE ARE AGREEMENTS ALREADY IN PLACE.

AND SO OUR RECOMMENDATION ARE FOR THOSE THAT HAVE CONTRACTS.

THOSE SHOULD CONTINUE AS PLANNED.

AGAIN, GIVEN THIS COUNCIL OR PRIOR COUNCILS HAVE ALREADY AUTHORIZED THOSE CONTRACTS.

SO WE RECOMMEND THOSE TO PROCEED AS PLANNED.

BUT THEN THERE ARE A FEW ITEMS THAT ARE A LITTLE BIT SMALLER IN NUMBER, A LITTLE SMALLER IN PRICE.

AND SO IF YOU GO TO IF YOU GO TO AH PAGE THREE, IT SAYS THE WORD PAGE THREE OF THE PROPOSED EDC BUDGET AND I'LL FLIP TO THAT AND I'LL SHOW IT TO YOU IN A SECOND HERE.

SO PAGE THREE LOOKS LIKE THIS.

AGAIN WE WROTE THE WORD PAGE THREE IN THE BOTTOM THERE YOU'LL SEE $875,000 OF TOTAL EXPENSES THERE.

THEY HAVE ITEMIZED THOSE OUT BETWEEN AMARILLO CHAMBER OF COMMERCE FOR 80,000.

[INAUDIBLE] PLANE 125.

TEXAS TEAM TEXAS FOR 40,000.

HIGH GROUND OF TEXAS MEMBERSHIP 25.

TEXAS ECONOMIC DEVELOPMENT CORPORATION MEMBERSHIP, 25.

AND THEN ENTERPRISE CENTER FOR 580.

THOSE ONES DISLIKE BACK.

RECOMMENDATION NUMBER TWO.

THOSE ONES WOULD NOT EXCEED 25%.

SO THOSE ARE OUR FOUR DIFFERENT RECOMMENDATIONS.

WE DID TRY TO CAPTURE EVERYTHING.

WITH SOME IDEAS WITH THIS.

BUT AGAIN THESE ARE JUST SUGGESTIONS, THOUGHTS THAT YOU CAN YOU CAN TWEAK THESE ADJUST THESE INSTEAD OF 25, MAKE IT 10%.

OR YOU CAN SAY EVERY ACCOUNT COME BACK TO US KIND OF THING.

THERE'S LOTS OF OPTIONS YOU CAN CHOOSE FROM, BUT THESE ARE ONES THAT THROUGH OUR ANALYSIS, GIVEN OUR EXPERIENCE WITH BUDGETS, THESE ARE WHAT WE RECOMMEND FOR YOUR CONSIDERATION. I'LL TAKE ANY QUESTIONS YOU HAVE.

QUESTIONS COUNCIL.

I DON'T HAVE ANY QUESTIONS.

YEAH. NOT REALLY ANY QUESTIONS I JUST YOU KNOW I THINK THAT THIS OUR JOB IS TO PUT GOOD BUSINESS PRACTICES INTO PLACE, WHICH THERE WERE NONE ON THE CITY SIDE. YOU KNOW, THERE'S NO CHECKS AND BALANCES, WHICH I THINK WE HAVE ASSURANCES NOW THAT THAT IS IN PLACE OR THAT WE'RE GOING TO PUT THOSE IN PLACE.

IS THAT CORRECT? WE ARE DEVELOPING THOSE POLICIES.

OBVIOUSLY, I THINK THAT'S GOING TO COME ABOUT THROUGH AFTER, YOU KNOW, GERBER'S RESEARCH.

I THINK THE GOAL, THE INTENT IS FOR COUNCIL TO REVIEW THAT.

AND THEN TOGETHER WE DEVELOP SOME POTENTIAL POTENTIAL PROTOCOL PROCEDURE CHANGES BETWEEN EDC COUNCIL AND STAFF.

OKAY. AND THEN ON THE OTHER SIDE, JUST TO MAKE SURE I THINK THAT THAT'S YOU KNOW, WE TALKED ABOUT WE MENTIONED, YOU KNOW, PUTTING GUARDRAILS UP TO KEEP US WHERE WE NEED TO BE, WHICH IT SEEMS LIKE, YOU KNOW, THE PUBLIC AND COUNCIL, I THINK STAFF AS WELL, IS A LITTLE SHOCKED, YOU KNOW, TO SEE WHAT HAPPENED AND WHAT COULD HAPPEN WITHOUT ANY GUARDRAILS UP.

[00:25:02]

I THINK AS FAR AS FURTHER DISCUSSION ON THIS, I MEAN, I'M OPEN TO, YOU KNOW, COUNCIL HEARING WHAT OTHER MEMBERS THINK OF WHAT WE NEED TO DO AND WHAT THOSE GUARDRAILS NEED TO LOOK LIKE, BECAUSE I THINK ACCORDING TO TEXAS LAW, I THINK THERE ARE A LOT MORE STRINGENT THAN THIS, ACTUALLY.

SO, I MEAN, I THINK I THINK WE'VE GOT TO ENTERTAIN THAT AS WELL.

OKAY. I THINK THAT'S A GOOD I THINK THAT'S A GOOD OPENING STATEMENT AND KIND OF GOING IT'S LEADING INTO WHERE WE WANT TO END UP.

SO I THINK WE'RE ON THE RIGHT PATH.

COUNCILMAN SHIRLEY ON WAGES AND SALARIES THAT INCLUDE BONUSES.

YEAH. UNDER THE UNDER THE SECTION 91100.

THERE IS A FLIP RIGHT TO THAT HERE.

THERE IS A IS IT PSP THOUGH.

IT IS. YES A PAY FOR PERFORMANCE.

YES. THAT SECTION IS A CATEGORY.

UNDER THE PERSONNEL SERVICES WILL BE 41,500.

IS THAT IS WHERE THAT'S FOUND? YES. IS THAT LEGAL TO GIVE BONUSES? I DON'T KNOW, I'M NOT THE BEST PERSON TO ANSWER THAT QUESTION.

SO IT MAY BE A GOOD LEGAL QUESTION.

I THINK WITH PUBLIC FUNDS, I THINK WE NEED TO.

I KNOW THAT I CAN TELL YOU WHEN IT COMES TO CITY EMPLOYEES, IT'S NOT.

AND SO I CAN'T ANSWER WHEN IT COMES TO NON-PROFITS, EDC.

BUT I KNOW WITH CITY EMPLOYEES, UNLESS IT'S WRITTEN OUT THROUGH A CONTRACT AHEAD OF TIME, I'M NOT AWARE THAT WE CAN RECEIVE BONUSES AS CITY EMPLOYEES, BUT I CAN'T SPEAK TO NONPROFITS. THE WAY I LOOK AT IT IS WE'RE USING THE SAME TAXPAYER MONEY, WHETHER IT'S THE CITY BUDGET OR A EDC BUDGET, IT'S THE SAME COMING OUT OF THE SAME POCKETS.

YEAH, AND I THINK WE NEED TO BE SURE BEFORE WE MAKE ANY OBLIGATIONS TO PAYING BONUSES TO MAKE SURE IT IS LEGAL.

AND IT IS RIGHT, BECAUSE I DON'T WANT TO BE HELD PERSONALLY RESPONSIBLE.

FROM WHAT I FOUND OUT, A LOT OF THIS STUFF, THIS COULD COME BACK ON COUNCIL ON THINGS THAT HAVE HAPPENED IN THE PAST.

AND I WANT TO BE REAL CAREFUL ON WHAT WE APPROVE AND WHAT WE DON'T APPROVE.

AND THAT'S WHY I'M ASKING THESE QUESTIONS.

IT'S NOT THAT I'M SAYING I'M AGAINST BONUSES.

I'M NOT SAYING THAT, BUT TO ME IT SEEMS A LITTLE.

WE TALKED ABOUT THIS EVEN LAST YEAR, GIVING BONUSES TO ONE PART OF TAXPAYERS MONEY AND NOT TO CITY EMPLOYEES WHO WORK JUST AS HARD, IF NOT HARDER.

SO I WOULD LIKE US TO CHECK THAT LEGALLY.

YEAH, WE CAN CHECK INTO THAT.

SEE WHERE WE ARE FOR SURE.

THERE'S ONE OTHER THING THEY BROUGHT UP LAST WEEK.

I BELIEVE THEY SAID IF IT'S OVER A 500,000, THAT THE DIRECTOR AND CHAIRMAN COULD MAKE THE CALL TO HAVE THAT MONEY TRANSFERRED.

IS THAT CORRECT? UNDER THEIR POLICY CHANGES, THE 9.2 SAYS ANY EXPENDITURE THAT EXCEEDS $500,000 OR GREATER WILL REQUIRE THE SIGNATURE OF THE PRESIDENT, CEO AND THE ADC BOARD CHAIR.

THAT'S ALL IT SAYS HERE.

WOULDN'T WE WANT THE WHOLE BOARD TO APPROVE THAT.

THAT WOULD BE A POLICY DECISION FOR THE COUNCIL.

I THINK, YOU KNOW, IN MY OPINION, WHEN WE JUST YOU'RE NOT CHANGING ANYTHING IF YOU'RE ALLOWING TWO PEOPLE TO DO IT WITHOUT A VOTE OF THE BOARD.

SO TO ME, THE BOARD HAS GOT TO PLAY A PART IN THE DOLING OUT OF THE MONEY.

WE CAN'T JUST PUT IT IN THE HANDS OF TWO PEOPLE.

YES, BECAUSE THAT LEADS TO IMPROPRIETY.

IT LEADS TO A LOT OF THINGS.

I HONESTLY BELIEVE THAT WHENEVER THEY GIVE MONEY, THEIR BOARD NEEDS TO BE INVOLVED IN THAT PROCESS.

YEAH, IT'S MY INTERPRETATION OF 501.073 THAT THE COUNCIL CAN SET WHATEVER POLICY YOU WISH TO SEE.

YEAH, I THINK FOR CLARIFICATION, BECAUSE WE COULD DRAW A LINE AND KIND OF HAVE A POINT OF DELINEATION THERE.

IF YOU'VE HAD A PROJECT THAT HAS A CONTRACTUAL OBLIGATION THAT EXCEEDS $500,000, THEN IT WAS VOTED ON BY THE COUNCIL.

IT WAS VOTED ON BY THEIR BOARD.

NOW IT'S JUST THE ISSUANCE OF THOSE FUNDS CONTRACTUALLY AS YOU AS YOU WORK THAT PROJECT FORWARD.

SO I THINK IT IS APPROPRIATE FOR THE DIRECTOR AND THE CHAIR TO CONTINUE TO SIGN FOR THOSE AS LONG AS THEY WERE BOTH ADOPTED OR OR APPROVED BY BOTH COUNCIL AND EDC BOARD.

I THINK WHAT YOU MAY BE REFERENCING WOULD BE LIKE IN ISSUANCE TO THIS WIRE TRANSFER.

IT WAS IN EXCESS OF $500,000, DID NOT HAVE THOSE AUTHORIZATIONS AND YOU KNOW, HAD IT HAVE BEEN APPROVED BY THE COUNCIL AND THEIR BOARD, YOU KNOW, A SIMPLE AUTHORIZATION FROM THE DIRECTOR AND THE CHAIR WOULD, WOULD SUFFICE.

CORRECT. OKAY. SO IF WE CAN DRAW THAT DELINEATION, I DON'T THINK WE'RE TRYING TO BRING I DON'T THINK WE'RE TRYING TO BRING EVERYTHING BACK FOR A FOLLOW UP VOTE.

SO WE DO WANT TO BE CAREFUL.

ONCE WE'VE CONTRACTUALLY OBLIGATED OUR EDC, THEN IT DOESN'T DO ANY GOOD TO BRING IT BACK FOR AN ADDITIONAL VOTE.

WE'RE CONTRACTED.

SO I THINK WE COULD BE DOING OURSELVES HARM IF WE ALLOW OURSELVES A CONTINUED, HEY, WE WANT TO LOOK AT THIS AGAIN.

[00:30:07]

SO ONCE THOSE CONTRACTS ARE PERFORMANCE ISSUES, THEN THEN WE WANT THAT DUE DILIGENCE.

HOWEVER, THOSE THINGS THAT HAVEN'T BEEN BROUGHT IN A CONTRACT FORM, I KNOW FOR SURE WE'RE LOOKING AT POLICIES THAT WILL MAKE EVERYTHING GO THROUGH BOTH BOARDS.

FURTHER QUESTIONS FOR MR. PATH. YES, SIR.

OKAY. THANK YOU SIR.

MR. CARTER, IF WE COULD GET YOU TO JOIN US UP HERE, I THINK IT WOULD BE GOOD IF YOU CAN JUST TAKE US THROUGH A REVIEW, MAYBE PREVIOUS YEAR'S BUDGET AND CURRENT BUDGET REQUEST AND, YOU KNOW, IS THERE ANY TRENDS THERE? WHAT ELSE YOU GUYS ARE ALREADY DOING TO TRY TO FACILITATE GOOD COMMUNICATION BETWEEN YOUR BOARD AND OUR BOARD AND ANYTHING ELSE YOU'D LIKE TO LEND TO THE CONVERSATION HERE TODAY? YEAH, I THINK I CAN SPEAK TO WHAT WAS JUST SAID ABOUT THE 500,000.

I THINK THAT THAT 9.1 WOULD TAKE CARE OF 9.2, BECAUSE IT WOULD SAY ANYTHING OVER THE 50,000 WOULD HAVE TO BE BOARD AND COUNCIL APPROVED.

AND SO THEN, THEN THAT'S WHERE THAT 500,000 WOULD COME IN.

THAT DOESN'T COME INTO PLAY, BUT MAYBE ONCE OR TWICE A YEAR, THAT 500,000 TYPICALLY IT'S HAPPENED WITH TEXAS TECH'S PAYMENT THAT WE'VE MADE OVER THE LAST FEW YEARS AND THEN A COUPLE OF INCENTIVE PAYMENTS THAT'S BEEN CONTRACTUALLY OBLIGATED.

BUT WE THOUGHT THAT 9.1 WOULD TAKE CARE OF WHAT COUNCIL MEMBER SHERWIN JUST ASKED.

BUT WE CAN CERTAINLY ADD THAT STATEMENT IN WITH THAT 9.2 IF WE NEED TO.

OKAY. IF YOU WANT TO JUMP INTO YOUR BUDGET, REQUEST ANYTHING YOU WANT TO EDUCATE US FURTHER ON AND HOW YOU'RE BREAKING THAT BUDGET DOWN.

YEAH, I KIND OF WANTED TO DO JUST A LITTLE BIT.

I THINK LAST WEEK THERE MIGHT HAVE BEEN SOME QUESTIONS ON WHAT TPRDC IS.

AND SO IF YOU'LL GIVE ME A COUPLE OF MINUTES TO EXPLAIN WHAT TPRDC IS, THAT'S THE TEXAS PANHANDLE REGIONAL DEVELOPMENT CORPORATION.

WE TOOK THAT IN-HOUSE IN 2011.

IT HAD BEEN HOUSED AT THE PANHANDLE REGIONAL PLANNING COMMISSION BEFORE THAT.

IT'S THE SBA504 PROGRAM.

SO A LOT OF THAT IT'S A SELF-SUSTAINING ORGANIZATION.

IT JUST HAS TO HAVE A SPONSORING ORGANIZATION.

AND SO EDC IS THE SPONSORING ORGANIZATION FOR THAT.

IT'S FULLY FUNDED, AND THAT'S WHY IT'S JUST PASSED THROUGH MONEY.

SO I KIND OF WANTED TO EXPLAIN THAT TO THE PUBLIC.

WHAT THAT DOES IS IT ACTS AS A LENDING ARM FOR SMALL BUSINESS WITH THE 504 PROGRAM.

IT WORKS WITH LOCAL BANKS.

THEY HAVE TO HAVE A LOCAL BANK LOAN FIRST, AND THEN THE 504 COMES IN AND STEPS IN TO PAY.

I BELIEVE UP IT WILL PAY UP TO 40% OF A LOAN.

SO AND SO KIND OF WANT TO JUST EXPLAIN WHAT TPRDC IS.

THOSE ARE ALL JUST PASS THROUGH MONIES.

I CAN I'M WILLING TO WORK OFF OF THIS OF THE CITIES LOOK OR THE A TRADITIONAL ADC LOOK, Y'ALL.

Y'ALL LET ME KNOW WHICH ONE YOU WANT TO WANT TO WORK OFF OF.

COUNCIL DO YOU HAVE A PREFERENCE ON WHICH ONE HE WALKS US THROUGH? I DON'T HAVE A PREFERENCE AT ALL, NO.

WHICHEVER ONE YOU'RE MORE COMFORTABLE, WE CAN FOLLOW EITHER ONE.

OKAY. ALL RIGHT. I'M GOING TO WORK OFF THE ADC ONE.

THERE'S THREE YEARS OF HISTORY HERE, AND THIS IS I'M GOING TO START WITH THAT.

JUST KIND OF THAT COVER SHEET THAT'S KIND OF ABOUT HALF A PAGE.

THAT SHOWS THE ADMINISTRATIVE.

I THINK THAT ONE'S IT. YEAH.

STEPHANIE. THANK YOU.

WE'RE LOOKING AT BUDGETING THIS YEAR.

PERSONNEL, ABOUT $1.6 MILLION.

THAT'S A 2% INCREASE, NOT INCLUDING MYSELF, THAT WE TOOK.

THAT WAS ON CITY'S GUIDANCE.

GUIDANCE THAT EVERY EMPLOYEE WAS GOING TO GET A 2% COST OF LIVING ADJUSTMENT.

OPERATIONS, WE WENT ACTUALLY WENT DOWN A LITTLE BIT COMPARED TO LAST YEAR.

SO OUR TOTAL ADMINISTRATIVE BUDGET'S AROUND $2 MILLION.

WE LEFT THE MARKETING BUDGET THE SAME.

IT'S BEEN AROUND 800,000 THE LAST THREE YEARS, SO TOTAL ADMIN AND MARKETING OF ABOUT $2.88 MILLION.

THAT DOES INCLUDE TPRDC.

AND THEN OUR PROJECT SUPPORT IS 875 THIS YEAR.

IT WAS 675 LAST YEAR, 875.

THAT INCLUDES PUTTING $200,000 BACK INTO THE BUDGET FROM FOR THE ENTERPRISE CHALLENGE.

REALLY, REALLY NOT A LOT OF INCREASE.

I THINK BENEFITS WENT UP 2%.

SO THAT'S SOME OF THE COST THAT WE HAD.

AND A LOT OF THAT HAS TO DO WITH THE TMRF I BELIEVE IN THAT RIGHT IS THE MAIN REASON THERE WAS AN INCREASE IN THE BENEFIT COST.

AND THEN ALSO OBVIOUSLY INSURANCE AND HEALTH CARE COSTS ARE RISING.

OPERATION BUDGET STAYED PRETTY MUCH THE SAME.

WE MAY HAVE MOVED SOME OF THOSE NUMBERS UP AND DOWN, BUT I THINK 439 IS THE EXACT SAME NUMBER AS WE USED LAST YEAR.

[00:35:01]

THAT'S BEEN THAT WAY FOR THREE YEARS AT LEAST.

AND THEN PROJECT SUPPORT, THOSE NUMBERS ARE EXACTLY THE SAME EXCEPT FOR THE ENTERPRISE CENTER.

SO TOTAL AEDC BUDGET OF $3.762 MILLION.

CERTAINLY BE WILLING TO ANSWER ANY QUESTIONS.

ANYTHING SPECIFIC ON THESE LINE ITEMS, GENTLEMEN? JUST ON THE OPERATIONS SIDE, KEVIN ARE ALL THOSE TRUE ESTIMATES OR THOSE JUST ALL ROUNDED UP NUMBERS? IS THAT GOES BACK TO THE CITY? NO. ON YOUR. NO ON YOURS? YEAH. ARE THOSE ACCURATE NUMBERS OR ARE THOSE JUST ROUNDED OFF BUDGETARY ITEMS? WE TRIED TO MAKE THOSE FAIRLY ACCURATE.

YOU KNOW, WE KNOW WHAT OUR RENT PAYMENT IS.

OBVIOUSLY, WE CAN'T ALWAYS.

WE KNOW WHAT THE FISCAL AGENT FEE IS.

INSURANCE FLUCTUATES A LITTLE BIT.

AND THEN PROFESSIONAL SERVICES FLUCTUATES A LITTLE BIT.

AND SO BUT THOSE ARE GOING TO BE FAIRLY CLOSE THIS YEAR.

ANY QUESTIONS GENTLEMEN.

THAT'S ALL I'VE GOT. GO AHEAD AND KEEP GOING THROUGH THE REST OF IT.

WHATEVER ELSE YOU'VE GOT. AND THEN WE'LL I THINK I THINK THAT'S IT.

SO YOU'RE GOOD. WAS THERE ANYTHING ELSE THAT YOU WANTED TO SPEAK ON HERE TODAY? AND MAYBE YOUR BOARD OR THE, THE OTHER CHANGES.

ARE THOSE FUNCTIONAL FOR YOU GUYS WITH WHAT? WITH WHAT CITY MANAGER PROPOSED I THINK YEAH.

I THINK THE CURIOSITY WOULD BE CAN LIVE WITHIN THOSE BOUNDARIES.

OKAY. SO ANYTHING THAT CITY MANAGER'S PROPOSING DOESN'T CAUSE YOU GUYS A HARDSHIP IN DOING BUSINESS.

NO, SIR. OKAY.

AND EVERYTHING THAT YOUR BOARD HAS PROPOSED CAME FROM YOU GUYS AS STAFF AND BOARD COLLABORATING TOGETHER.

THAT'S CORRECT. AND I APPRECIATE GRAYSON AND LAURA WORKING WITH US ON THIS AND PREPARING AND ASKING QUESTIONS.

AND SO CERTAINLY APPRECIATE THE WORK THAT THEY DID.

GREAT. OKAY.

THANK YOU, MR. CARTER. WE WE'RE GOING TO KEEP YOU AROUND HERE FOR A MINUTE.

I KNOW YOU'RE NOT GOING ANYWHERE, BUT WE MAY HAVE A FOLLOW UP QUESTION.

ABSOLUTELY. BUT I THINK AT THIS TIME I'M GOING TO DIRECT OUR CONVERSATION TO A TOPIC THAT IS THE THE ELEPHANT IN THE ROOM.

AND SO WE HAVEN'T NECESSARILY PUT OUR FINGER ON IT QUITE AS FINITE AS WE'RE GOING TO HEAR TODAY.

SO WE HAVE MR. HYDE HERE FROM HYDE KELLY.

TRULY LIKE AN OUTSTANDING RESOURCE AROUND THE STATE AND HELPING US NAVIGATE THIS.

AND SO WHAT I WANT TO DO IS I WANT TO DRAW A LINE OR A DEFINITION BETWEEN BUDGET AND EXPENDITURE AND SO WHERE WE'VE BEEN STRUGGLING WITH THIS IS WE'VE BEEN GIVEN A BUDGET AND WE'RE ASKING TO APPROVE THE BUDGET AND THEN AS YOU CAN SEE WITH POLICIES AND PROCEDURES, WE DON'T NECESSARILY HAVE EXPENDITURES THAT ARE COMING BACK FOR FORMALIZED APPROVALS.

SO WE ARE SAYING, WELL, A BUDGET IS AN APPROVAL.

WELL, IT COULD BE IN THE WAY IN WHICH WE WE MOVE IT FORWARD.

HOWEVER, IN THE RECENT TRANSACTION WITH THE RANGE, THAT'S AN OBVIOUS EXAMPLE OF HOW A BUDGET ITEM AT $100,000 GOT EXPENSED AT $750. SO WHERE WAS THE APPROVAL OF THAT SPECIFIC EXPENDITURE? NOW, MOVING BACK TO THE DEFINITION AND THE TERMS, I THINK THAT EVEN BUDGET ITEMS THAT ARE ALLOWED FOR WHAT YOU GUYS HAVE HEARD THE EDC SAY, WELL, WE HAVE A DISCRETIONARY BUDGET OR WE HAVE A DISCRETIONARY ITEM, TRULY WE DON'T RIGHT NOW.

AND I DON'T KNOW THAT YOU HAVE HAD THAT.

BUT MR. HYDE, I THINK WHAT I'D LIKE TO DO IS START OFF WITH YOU EDUCATING US ON WHAT THE STATE LAW, YOU KNOW, SAYS PRETTY BLACK AND WHITE WHAT A BUDGET CAN BE.

AND THEN HOW DO WE FACILITATE? I WOULD CALL THEM PRE-APPROVED EXPENDITURES FOR THE YEAR GOING FORWARD, SO THAT WE DO RESTORE THAT CONFIDENCE IN OUR PUBLIC TRUST.

AND WHERE ALL THE MONIES ARE GOING AND HOW THEY'RE BEING NOTICED TO THE PUBLIC.

SO I'LL TURN IT OVER TO YOU IF YOU WANT TO WALK US THROUGH THAT FOR A MINUTE.

THANK YOU, MR. MAYOR.

CAN EVERYONE HEAR ME? ALL RIGHT.

YOU'RE GOOD. YES, SIR.

GREAT. SO, FIRST OF ALL, 501 073A IS THE LOCAL GOVERNMENT CODE PROVISION WHICH WE'VE BEEN DISCUSSING, WHICH REQUIRES THE CITY COUNCIL AS THE AUTHORIZING UNIT TO APPROVE ALL EXPENDITURES.

THAT'S THE FIRST PHRASE OF THAT STATUTE.

THE STATUTE GOES ON AND SAYS THAT IN ADDITION TO THAT, THAT THE CITY COUNCIL WILL APPROVE.

WILL A REVIEW NOT APPROVE BUT REVIEW ANNUALLY THE FINANCIAL STATEMENTS OF THE LOCAL GOVERNMENT CORPORATION OR THE ECONOMIC DEVELOPMENT CORPORATION, AND SO IN DOING SO, THE BUDGET PORTION IS A FINANCIAL DOCUMENT, WHICH IS TO BE ANNUALLY REVIEWED BY THE CITY COUNCIL BY LETTER OF THE LAW, AND THAT AN EXPENDITURE WHICH IS DIFFERENT THAN A FINANCIAL DOCUMENT IS ALSO MUST BE

[00:40:09]

ALL 254.

IN TEXAS, WHERE EVERY MONTH THERE ARE BILLS TO BE PAID, HAS TO BE APPROVED BY THE COUNTY COMMISSIONERS COURT.

EVERY CHECK HAS TO BE APPROVED.

SO THERE ARE MECHANISMS THAT WE CAN USE IN ORDER TO PROVIDE A LINE ITEM BUDGET PROCESS, AND THAT EACH LINE ITEM IDENTIFIES THE ALLOCATION OR EXPENDITURE.

SO FOR INSTANCE, INSTEAD OF HAVING A SALARIES ITEM, YOU WOULD HAVE THE NUMBER OF EMPLOYEES THAT HAVE BEEN APPROVED AND THE RELATED SALARIES AND BENEFITS ASSOCIATED WITH THAT COST BY THE INDIVIDUAL, THAT THAT WAY YOU HAVE A CLEAR UNDERSTANDING OF WHERE THOSE FUNDS ARE SUPPOSED TO BE SPENT AND HOW THOSE ARE GOING TO BE SPENT.

IN THAT CASE, YOU WOULD BE ABLE TO IDENTIFY THOSE AS A PRE-APPROVED BUDGET ITEM, BECAUSE THE APPROVAL OF THE BUDGET CAN ALSO BE BY SPECIFIC EXPRESS STATEMENTS BY THE CITY COUNCIL, THE APPROVAL OF THE EXPENDITURE.

NOW, WHEN YOU GET TO OTHER ITEMS, THERE CAN BE A REQUIREMENTS OR OTHER ELEMENTS OF THE ARTICLES OF INCORPORATION, WHERE YOU CAN PUT IN PRINCIPLES WHICH ARE COST SAVINGS PRINCIPLES.

FOR INSTANCE, SAY THAT THERE IS A NEED FOR FUEL AND FUEL HAS TO BE BID BY THE GOVERNMENT. THE MORE FUEL, TYPICALLY THE LESS PER GALLON IT'S COST THE CITY.

AND SO IF THE ARTICLES OF INCORPORATION REQUIRED THE ECONOMIC DEVELOPMENT CORPORATION TO RECEIVE FUEL FROM, YOU KNOW, AND PARTICIPATE IN THE CITY'S FUEL CONTRACT, THEN THAT WOULD BE ANOTHER MECHANISM BY WHICH YOU CAN RELATE OR NARROW THE ALLOCATIONS TO ENSURE THAT THE PUBLIC FUNDS ARE BEING SPENT PROPERLY AND CONSERVATIVELY, CONSERVATIVELY.

SECOND, JUST FOR THE QUESTION THAT COUNCIL MEMBER SHIRLEY MADE EARLIER ACTUALLY, THIS IS KIND OF A TWOFOLD QUESTION WITH REGARDS TO BONUSES. BONUSES ARE TYPICALLY ALLOWED BY NON-GOVERNMENTAL ENTITIES IN THAT THOSE BONUSES ARE PART OF PROFITS IN A NONPROFIT CORPORATION, PROVIDING BONUSES, ESPECIALLY IN AN ECONOMIC DEVELOPMENT CORPORATION WHERE THE FUNDS ARE TAX FUNDS WOULD POSSIBLY BE ALLOWED, BUT FOR THE FACT THAT THIS EXPENDITURE FOR BONUS HAS TO BE APPROVED BY THE CITY COUNCIL.

THE TEXAS CONSTITUTION, ARTICLE 52 PROVIDES THAT YOU CANNOT APPROVE FUNDS TO BE USED AS A GIFT.

GIFTING PUBLIC MONEY IS NOT IS UNCONSTITUTIONAL IN TEXAS, AND THEREFORE YOUR ACTION THAT WOULD APPROVE A BUDGET ITEM THAT WOULD ALLOW FOR BONUSES TO BE PROVIDED BY THE ECONOMIC DEVELOPMENT CORPORATION WOULD BE CONTRARY TO ARTICLE 52 OF THE CONSTITUTION.

SO WHILE NORMALLY A NONPROFIT CORPORATION COULD DO IT BECAUSE THE ECONOMIC DEVELOPMENT CORPORATION IS WHAT WE CALL A QUASI GOVERNMENTAL ENTITY, IT HAS CERTAIN ELEMENTS OF THE GOVERNMENT.

IT IS IN A POSITION WHERE IT'S CONSTRAINED FROM A FINANCIAL STANDPOINT, THE SAME WAY THE CITY IS.

IF YOUR APPROVAL WAS NOT NECESSARY, THEN IT MAY CHANGE THE OUTCOME.

SO HERE AND IN OTHER ECONOMIC DEVELOPMENT CORPORATIONS WHERE THEY'VE HAD SOME ISSUES THAT I'VE WORKED WITH ALL THE WAY BACK TO 2010 WHEN YOU DEVELOP THIS GREATER SPECIFICITY IN THE BUDGET.

IT REQUIRES A GREATER DEAL OF THOUGHT AND FORWARD THINKING BY THE ECONOMIC DEVELOPMENT GROUP SO THAT THEY CAN HAVE A PLAN AND THEN EXECUTE THAT PLAN FOR THE CITY.

THE PERFORMANCE AGREEMENTS, WHICH IS A DIFFERENT SECTION OF THE ECONOMIC DEVELOPMENT CORPORATION RULES, PROVIDES THAT THE GOVERNING BODY HAS TO ALSO APPROVE THOSE PERFORMANCE AGREEMENTS.

SO THE INCENTIVES HAVE TWO ELEMENTS OF APPROVAL.

YOU HAVE TO APPROVE THE AGREEMENT AND YOU HAVE TO APPROVE THE EXPENDITURE.

BUT WHEN IT'S NOT A ECONOMIC DEVELOPMENT PROJECT AND THE EXPENDITURES ARE SUCH THAT ARE NOT IN CONFLICT WITH

[00:45:06]

THE I'M SORRY ECONOMIC DEVELOPMENT CORPORATION.

THE ECONOMIC DEVELOPMENT CORPORATION BY STATUTE, OPERATES AS A NONPROFIT CORPORATION UNDER CHAPTER 22 OF THE BUSINESS ORGANIZATIONS CODE.

AND SO IT IS THOSE THAT COMBINATION THAT CREATES A LITTLE BIT OF MURKINESS IN THE MANNER IN WHICH THESE GET DONE.

BUT WE CLARIFY THAT BY ADOPTING IN THE ARTICLES OF INCORPORATION, WHICH DEMONSTRATE BECAUSE THE COUNCIL'S ACTION FOR PURPOSES OF OVERSEEING THE EXPENDITURE OF PUBLIC FUNDS BY CREATING A MANDATORY PROCESS BY WHICH THOSE FUNDS ARE IDENTIFIED, HOW THE EXPENDITURES ARE IDENTIFIED, AND THEN ULTIMATELY HOW THEY'RE SPENT.

YOU KNOW, AN EXAMPLE THAT THAT IS YOU KNOW, IT'S KIND OF WIDE OUT THERE, BUT THESE ARE THE KIND OF CONCERNS THAT ULTIMATELY OCCUR WHEN EXPENDITURES ARE NOT SPECIFICALLY IDENTIFIED IN THAT, SAY, FOR INSTANCE, THAT YOU HAVE A MEMBERSHIP FEE THAT YOU AUTHORIZE FOR MEMBERSHIPS OF THE ORGANIZATION AND THAT MEMBERSHIP FEE IS $100,000.

NOW THIS IS ONLY A DRASTIC EXAMPLE, BUT IF THAT $100,000 WAS GIVEN TO AN INDIVIDUAL THAT HAD THE ABILITY AND DISCRETION TO SPEND THAT $100,000, THEY MAY SPEND IT ON THE CHAMBER OF COMMERCE, OR THEY MAY SPEND IT TO JOIN THE KKK.

BECAUSE THE EXPENDITURE, THE BUDGET DOES NOT CONTROL THAT.

THEY WOULD HAVE TO COME TO THE CITY COUNCIL AND SAY, CITY COUNCIL, WE WANT TO JOIN THE CHAMBER OR WE WANT TO JOIN THIS, AND THIS IS HOW MUCH IT COSTS TO JOIN.

AND THEN THE CITY COUNCIL THEN HAS THE ULTIMATE AUTHORITY TO DECIDE WHETHER THOSE TAX DOLLARS WILL ARE APPROPRIATELY PAID THAT WAY.

I'LL CONCLUDE GENERALLY WITH THAT THE THE EXPENDITURE UNDER 073A IS SPECIFICALLY THERE BECAUSE IT'S REQUIRED UNDER OUR SYSTEM OF GOVERNMENT. OUR SYSTEM OF GOVERNMENT REQUIRES THAT ELECTED OFFICIALS ARE THE ONES THAT ULTIMATELY APPROVE THE EXPENDITURE OF TAX DOLLARS, WITHOUT THE PUBLIC OFFICIALS BEING HAVING A HAND IN IT.

AND IF A DELEGATED BOARD IS THE ONE THAT OR AN INDIVIDUAL HAS THE ABILITY TO SPEND PUBLIC MONEY WITHOUT CHECKS.

THEN WE HAVE TAXATION WITHOUT REPRESENTATION.

AND THAT'S THE FUNDAMENTAL BASIS UPON WHICH 0738 RESTS.

SO LET ME LET ME JUMP IN THERE WITH YOU REAL QUICK.

MR. HYDE, I SHOULD HAVE DONE THIS EARLIER.

YOU HAVE AN EXTENSIVE BACKGROUND IN WORKING WITH EDCS ACROSS THE STATE OF TEXAS.

AND TELL US JUST A LITTLE BIT BRIEF HISTORY AND MAYBE WHAT YOU'VE WORKED THROUGH WITH THE STATE.

SOME OF YOUR HISTORY AND EXPERIENCE.

SURE. SO I STARTED OUT AS A LAW ENFORCEMENT OFFICER FOR SEVERAL YEARS, AND THEN I WENT TO LAW SCHOOL AND BECAME AN ATTORNEY AND IMMEDIATELY STARTED WORKING WITH LOCAL GOVERNMENT, PRINCIPALLY MUNICIPALITIES.

I'M A CERTIFIED CLAIMS COUNSEL BY THE TEXAS MUNICIPAL LEAGUE INTERGOVERNMENTAL RISK POOL.

I HAVE BEEN FOR OVER 20 YEARS WHERE I'M ASSIGNED BY THE POOL IN ORDER TO LITIGATE MATTERS AND DEFEND MUNICIPALITIES AND LAWSUITS.

I'VE ALSO BEEN INVOLVED IN ECONOMIC DEVELOPMENT SINCE 2003.

THAT WAS RIGHT BEFORE THEY MADE A SIGNIFICANT CHANGE IN THE LAW IN 2004, WHICH SIGNIFICANTLY CURTAILED SOME ABUSES THAT WERE GOING ON IN THE FIRST RUN OF THE ECONOMIC DEVELOPMENT STATUTES.

AND FROM THEN, I'VE BEEN REGULARLY TAKING THE EDC, THE ECONOMIC DEVELOPMENT CORPORATION COURSES, AS I'M A CITY ATTORNEY, HAVE BEEN A CITY ATTORNEY IN MORE THAN A DOZEN CITIES ACROSS TEXAS IN THE 26 YEARS THAT I'VE BEEN DOING THIS.

ADDITIONALLY, I'VE BEEN CALLED UPON BY SEVERAL MUNICIPALITIES WHEN I CALL IT AN EDC GOES ASTRAY.

AND THERE ARE SOME PROTOCOLS THAT HAVE BEEN MISSED.

I'VE HAD TO DEAL WITH FEDERAL INVESTIGATIONS.

I'VE HAD TO DEAL WITH TEXAS RANGER INVESTIGATIONS BECAUSE THE FUNDS ARE ULTIMATELY TAX FUNDS.

AND THE THE WORK HAS BEEN VERY CHALLENGING, BUT AT THE SAME TIME REWARDING WHEN WE'RE ABLE TO GET PROPER PROTOCOLS IN PLACE SO THAT THE THE CITY AND THE ECONOMIC DEVELOPMENT CORPORATION CAN CONTINUE TO REBUILD ITS TRUST WITH THE CITIZENS IT SERVES. SO THANK YOU FOR THAT.

I SHOULD HAVE STARTED THERE, BUT I THINK WE WERE JUST MOVING RIGHT ALONG.

[00:50:03]

BUT, YOU KNOW, I'M NOT SURE THAT OUR OUR EDC BOARD IS APPROVING THE EXPENDITURES INDIVIDUALLY.

YOU TALKED ABOUT LIKE THE COMMISSIONERS FOR, SAY, POTTER COUNTY.

YOU KNOW, THEY APPROVE INDIVIDUAL EXPENDITURES EVERY MONTH.

MR. CARTER, DOES YOUR BOARD APPROVE YOUR EXPENDITURES EVERY MONTH OR CAN YOU SPEAK TO THAT? AND IS THERE A BOARD THAT IS APPROVING THOSE EXPENSES AS THEY COME IN ON A MONTHLY BASIS? THEY ARE NOT. OKAY.

SO HOW ARE YOU FUNCTIONING THEN ON LIKE THE OVERALL BUDGET? YOU JUST KEEP A RUNNING TALLY UNDERNEATH THAT LINE ITEM.

AND IF YOU EXCEED THAT THEN YOU YOU ADDRESS YOUR BOARD.

SO WHAT HAPPENS EVERY MONTH WE GET FINANCIAL STATEMENTS FROM THE CITY.

THE CITY PREPARES. WE PAY $75,000 FOR THE CITY TO BE OUR FISCAL AGENT.

LAURA AND A COUPLE OF STAFF MEMBERS COME AND MEET WITH DOUG AND MYSELF.

DOUG NELSON.

EVERY MONTH, WE REVIEW THOSE FINANCIALS TO MAKE SURE THAT WE'RE IN LINE WITH THOSE WHERE WE NEED TO BE.

AND THAT'S WHERE WE KNOW WHETHER WE'RE GOING TO BE OVER BUDGET OR WE'RE NOT GOING TO BE OVER BUDGET.

SO ONCE AGAIN, DRAWING A LINE AND MAKING A CLEAR DISTINCTION BETWEEN APPROVED BUDGET VERSUS APPROVED EXPENDITURES.

YOU GUYS ARE OPERATING, BE IT NOT SPECIFIC UNDERNEATH A POLICY, BUT YOU ARE OPERATING UNDER A BUDGET APPROVAL.

ONCE YOU GET BUDGET APPROVAL FROM COUNCIL, YOU AS THE DIRECTOR AND YOUR STAFF ARE ISSUING APPROVALS, JUST, YOU KNOW, INTERNALLY WITH WITHOUT ANYTHING EVER COMING BACK TO YOUR BOARD.

THAT'S CORRECT. OKAY.

SO, MR. HYDE, THANK YOU, MR. CARTER. MR. HYDE, IF YOU COULD WALK US TO THAT NEXT STEP.

I HEARD YOU SAY A FEW THINGS.

IT SOUNDED LIKE YOU WERE TALKING ABOUT, YOU KNOW, AMENDING ARTICLES OF INCORPORATION IN ORDER TO PUT SOMETHING NOT LIKE A BYLAW OR A POLICY, BUT PUT SOMETHING IN PLACE THAT DRAWS THAT, THAT DELINEATION.

AM I TRYING TO MAKE THIS TOO SIMPLE, OR CAN WE KEEP GOING DOWN THIS TRACK OF WHAT I THINK IS I LIKED THE TERM YOU USED GREATER SPECIFICITY.

SO IN DOING A PRE-APPROVED BUDGET, YOU'RE GOING TO HAVE TO BE MORE SPECIFIC ON THESE LINE ITEMS, YOU'RE GOING TO GET AN APPROVAL FOR THE YEAR.

COUNCIL WOULD APPROVE THAT.

THEIR BOARD WOULD APPROVE THAT.

THEN WE WOULD KNOW IN ADVANCE WHAT THOSE MONIES WERE GOING OUT FOR.

THEN YOU WOULD HAVE A REVIEW ANNUALLY BY THIS COUNCIL TO SEE, YOU KNOW, DID THEY ACTUALLY PAY X, Y, Z OR DID THEY MAKE A CHANGE? AND SO IF THEY WERE TO MAKE A CHANGE, YOU WOULD EXPECT THAT UNDER THIS AMENDMENT IN THEIR ARTICLES TO COME BACK TO THIS COUNCIL WE WOULD LIKE TO PAY ABC, NOT XYZ, YOU KNOW, CAN WE DO THAT? THEN THAT APPROVAL WOULD HAPPEN TO WALK US THROUGH THAT AND TIGHTEN THAT UP A LITTLE, BECAUSE I DON'T KNOW THAT WE'RE EXPLAINING IT AS WELL AS I WOULD HOPE TO IN WHAT YOUR POTENTIAL RECOMMENDATION WOULD BE.

YES, SIR. THE, THE I'LL USE AN ANALOGY WITH REGARD TO CIVIL SERVICE.

FOR INSTANCE, WHEN YOU HAVE A CIVIL SERVICE AS POLICE DEPARTMENT, FIRE EMS, YOU HAVE CLASSIFIED POSITIONS, AND THOSE CLASSIFIED POSITIONS ARE PAID A CERTAIN AMOUNT OF MONEY, AND THOSE CLASSIFIED POSITIONS CAN'T CHANGE.

SO IF YOU HAVE 15 OPENINGS, THOSE 15 OPENINGS GET FILLED.

AND THEN IF THERE'S A VACANCY, THAT VACANCY STAYS OPEN.

IT'S NOT THAT YOU SPEND THE MONEY ON SOMETHING ELSE.

AND SO WITHOUT LINE ITEM TRANSFERS, IT CREATES MORE SPECIFICITY WITH REGARDS TO THE AUTHORITY AND APPROVAL OF THE FUNDS.

OTHERWISE, IF THERE IS NO RESTRICTION ON LINE ITEM TRANSFERS, THEN WHAT YOU'VE REALLY DONE IS PASSED.

A SINGLE AMOUNT OF MONEY THAT CAN BE ALLOCATED TO WHATEVER ALLOCATIONS THEY LATER DECIDE TO DO.

SO THERE WAS ANOTHER QUESTION OR COMMENT EARLIER THAT I WANT TO POINT OUT IS THAT TECHNICALLY, IN ORDER FOR THE BOARD TO ENTER INTO AN AGREEMENT JUST LIKE THE CITY.

THERE HAS TO BE A MAJORITY VOTE OF THAT BOARD.

AND SO IF THERE'S A CONTRACT THAT IS PUT IN PLACE WITHOUT A MAJORITY VOTE OF THE BOARD APPROVING THAT CONTRACT AND AUTHORIZING THE EXECUTIVE DIRECTOR TO EXECUTE THAT CONTRACT, THEN THAT CONTRACT HAS FAILED TO MEET THE LEGAL REQUIREMENTS OF THE APPROVAL, THE VERY APPROVAL ITSELF.

AND IF THE FUNDS FOR THAT CONTRACT WERE NOT APPROVED BY THIS BODY, THE EXECUTIVE UNDER 073A, THEN YOU HAVE AN ILLEGALITY, WHICH IS A METHOD BY WHICH A CONTRACT CAN BE CANCELED WITHOUT ANY OBLIGATION BECAUSE ILLEGAL CONTRACTS

[00:55:04]

SO THESE ARE THE REASONS WHY THESE ARE ALL PUT IN PLACE SO THAT WE DON'T GET INTO SITUATIONS WHERE ONE INDIVIDUAL CAN SIGN A CONTRACT FOR $1 MILLION AND THEN START PAYING THOSE TAX DOLLARS WITHOUT THE BOARD APPROVING AND WITH THE CITY COUNCIL.

BUT THE CITY COUNCIL ITSELF HAS THE UNIQUE AND SOLE AUTHORITY TO ADOPT ITS ARTICLES OF INCORPORATION.

SO IN THOSE YOU SIMPLY IDENTIFY THAT LINE ITEM BUDGET.

AND IN THE PAST I'VE USED COLOR CODING.

I'VE USED ALLOCATIONS OF ROUTINE VERSUS TRANSACTIONAL.

SO ANYTHING THAT IS A ROUTINE, LIKE AN ANNUAL SALARY OF AN INDIVIDUAL, THE NUMBER OF NUMBER OF POSITIONS THAT ARE THERE, ETC., YOU CAN MARK ALL THOSE. AND THEN WHEN THE BUDGET COMES FORWARD, YOU IDENTIFY AND INCLUDE LANGUAGE IN THE BUDGET DOCUMENT THAT SAYS THAT THE ITEMS LISTED HERE THAT ARE ANNOTATED WITH A GREEN HIGHLIGHT OR THE LETTER R OR HEREBY THOSE EXPENDITURES ARE APPROVED BY THE CITY COUNCIL.

ALL OTHER EXPENDITURES ARE.

ALL OTHER BUDGET ITEMS HERE ARE NOT APPROVED AS EXPENDITURES, AND MUST COME BEFORE THE CITY COUNCIL BEFORE THEY'RE SPENT.

AND THEN THAT WAY, EVERYBODY HAS A VERY CLEAR UNDERSTANDING OF WHAT IS AND WHAT ISN'T APPROVED.

AND THEN THOSE POTS OF MONEY, YOU KNOW, THE $800,000 OF MARKETING, THE X THOUSANDS OF DOLLARS AND, YOU KNOW, HERE AS A BUSINESS, I DO THE SAME THING WITH, YOU KNOW, SUBSCRIPTIONS.

EVERYBODY HAS MICROSOFT OR SOME OTHER TYPE OF PIECE LIKE THAT.

YOU JUST LINE THOSE UP LIKE YOU DO ON A BALANCE SHEET AND AN EXPENSE DOCUMENT, AND YOU'VE GOT YOUR BUDGET FOR THE NEXT YEAR LOOKING AT YOUR LAST YEAR'S BUDGET.

MR. HYDE. OH, I THINK THAT'S A GOOD EXPLANATION.

I WANT TO ASK A SPECIFIC QUESTION.

AND THEN I SAW COUNCILMAN CRAFT LEAN UP SO HE MAY HAVE SOMETHING TO JUMP INTO.

BUT IN DOING BUSINESS THIS WAY, IT'S GREATER SPECIFICITY.

BUT DO YOU SEE THAT THIS CAUSES A HARDSHIP IN FUNCTION? IS IT SIMPLE ENOUGH TO CONTINUE DOING BUSINESS IN A, IN A GOOD BUSINESS LIKE MANNER? AND WE WOULDN'T BE SLOWING DOWN THE PROCESS OR PREVENTING ECONOMIC DEVELOPMENT IN TOWN IN ANY WAY? YEAH. YEAH, IT'S VERY YOU JUST HAVE TO PUT IT IN PLACE AND THEN ADOPT IT.

AND ONCE YOU HAVE IT IN PLACE, IT BECOMES RATHER ROUTINE.

MANY, MANY CITIES THROUGHOUT THE STATE RUN ON LINE ITEM BUDGETS.

AND AS I MENTIONED BEFORE, YOU KNOW, I THINK THERE WERE 34 PAGES OF POTTER COUNTY EXPENDITURES THAT WERE APPROVED FOR $3.7 MILLION ON SEPTEMBER 19TH OR OF THIS MONTH.

I THINK IT WAS THE 19TH.

SO THEY DO MULTI-MILLION DOLLAR TRANSACTION EACH MONTH BY LINE ITEM.

SO I THINK THAT THAT THE ECONOMIC DEVELOPMENT CORPORATION WOULD HAVE AN EASIER GO THAN THE CONSTITUTIONAL REQUIREMENTS OF THE OF THE COUNTY.

COUNCILMAN CRAFT I SAW YOU MAY HAVE A QUESTION, GEORGE I JUST HAVE A COUPLE CLARIFYING QUESTIONS.

SO JUST TO BE CLEAR, ALL EXPENDITURES, SO THE $50,000 POLICY THAT WAS BROUGHT TO US LAST COUNCIL MEETING IS VOID, CORRECT? IT DOES NOT.

IT'S NOT CONSISTENT WITH STATE LAW.

AND STATE LAW CANNOT BE AMENDED BY POLICY.

AND SO I WOULD CAUTION THE CITY COUNCIL ON ADOPTING ANYTHING THAT IS CONTRARY TO CITY POLICY OR TO STATE LAW.

OKAY. HOW LONG WOULD IT TAKE TO AMEND ARTICLES OF INCORPORATION AND GET MORE SOLIDIFIED, IDENTIFYING THINGS IN THERE? I THINK THAT 7 TO 10 DAYS IS I CAN PUT THESE TOGETHER AND LOOK AT THE MATERIALS.

I'D LIKE TO WORK WITH THE ECONOMIC DEVELOPMENT CORPORATION TO SO THAT WE CAN DO THIS COLLABORATIVELY TO ENSURE THAT THAT ALL OF THEIR CONCERNS ARE ADDRESSED. AND THEN ONCE THAT'S DONE, BRING IT BACK TO THE CITY COUNCIL FOR THEIR CONSIDERATION.

OKAY. THAT'S THE ONLY TWO QUESTIONS I HAD.

THANK YOU, SIR. COUNCILMAN TIPPS.

DO YOU HAVE ANYTHING FOR OUR ATTORNEY? I DO NOT. COUNCILMAN SCHERLEN.

WELL, I'D LIKE A CLARIFICATION ON THE BONUS ISSUE.

IS IT LEGAL OR IS IT NOT? WELL, BECAUSE THE BONUS WOULD BE PART OF THE SALARY ALLOCATION IN THE BUDGET.

[01:00:06]

AND SO MY RECOMMENDATION WOULD BE THAT THE CITY COUNCIL NOT AUTHORIZE THE USE OF TAX DOLLARS FOR BONUSES FOR THE ECONOMIC DEVELOPMENT CORPORATION.

THANK YOU. ANYTHING FURTHER, COUNCILMAN SCHERLEN? NOT AT THIS TIME.

OKAY. SO, GENTLEMEN SPEAKING TO MY COUNCIL, I AM.

I AM STEERING US IN A DIRECTION THAT IT'S OBVIOUS THAT THIS IS NOT MY IDEA.

I DON'T HAVE THE EXPERTISE OR THE WHEREWITHAL TO FORMULATE THIS.

MR. HYDE, YOU'VE HAD ME ON THE PHONE SEVERAL TIMES.

IT MAY HAVE TAKEN A FEW WEEKS FOR IT TO FINALLY CLICK.

FOR ME. FOR ME TO UNDERSTAND APPROVAL OF A BUDGET IS NOT APPROVAL OF EXPENDITURES.

AND THAT WE TRULY WERE NOT OPERATING CONSISTENT WITH STATE LAW IN, IN HOW THOSE EXPENDITURES ARE BEING APPROVED.

NOW, IN THIS THREE YEAR FINANCIAL REVIEW THAT WE'RE GOING TO GET, I THINK, ACCORDING TO WHAT I'M HEARING MR. GERBER SAY, AS IT PERTAINS TO PROJECTS, THAT THERE IS SUPPORTING DOCUMENTATION, THEY ARE DOING EVERYTHING CORRECT.

I THINK IT'S ISOLATING THOSE PROJECT SUPPORT, BUSINESS DEVELOPMENT, MARKETING THOSE OTHER EXPENDITURES.

SO I KNOW THAT THIS COULD LOOK A LITTLE RIGID, BUT I THINK IT IS A GOOD FORM AND GOOD BUSINESS PRACTICE.

I'M GOING TO ASK MY COUNCIL HERE IN A MINUTE.

I THINK THIS INITIATIVE WOULD FALL ON YOU AND WE WOULD TASK YOU WITH THIS AS THE BODY.

I'M GOING TO GO BACK TO WHAT DOES THE LAW NOT ALLOW US TO PAY FOR IN.

AND DOES THE EDC NEED TO GET A PROPOSAL FROM YOU FOR HOW MUCH THIS WOULD COST? AND DOES THE EDC NEED TO APPROVE THIS INITIATIVE FOR YOU TO AMEND THE ARTICLES, OR IS THAT SOMETHING WE CAN DO WITHIN OUR BUDGET BECAUSE THE ECONOMIC DEVELOPMENT CORPORATION DOES NOT HAVE ANY VOTING OR APPROVAL POWERS FOR ARTICLES OF INCORPORATION, IT'S PURELY THE CITY COUNCIL.

AND SO IT WOULD BE A CITY COUNCIL TASK FOR ME TO ADOPT THESE OR PREPARE THESE FOR THE CITY COUNCIL'S APPROVAL.

OKAY. SO WITHIN OUR BUDGET, WE HAVE THE FUNDING THERE TO CONTINUE TO WORK WITH YOU.

YOU'RE ALREADY HIRED FORMALLY.

WOULD IT WOULD IT BENEFIT YOU TO GIVE US A FORMAL PROPOSAL? SO WE WOULD WE WOULD HAVE AN UNDERSTANDING OF WHAT THIS WOULD COST.

IS THAT SOMETHING YOU CAN GUESSTIMATE HERE TODAY, OR IS THAT SOMETHING YOU WOULD NEED TO GET BACK TO US ON? IT'S NOT GOING TO BE LIKE A $10,000 EXPENDITURE.

I'M SURE IT'LL BE LESS THAN THAT, BUT TO HAVE A PRECISE NUMBER.

PROBABLY SOMEWHERE BETWEEN 5000 AND MAYBE 7500 IS MY GUESSTIMATE RIGHT NOW.

OKAY. SO I WOULD ASK COUNCIL IF YOU GUYS WANT TO HAVE ANY DISCUSSION ON THIS.

I'M NOT TRYING TO GET YOU THREE STEPS DOWN THE ROAD.

ONE WOULD WE DO WE LIKE THIS PLAN? IS THIS A SAFE WAY TO PROCEED? TWO WOULD WE WANT TO INITIATE THIS OVER TO HIDE KELLY.

AND THEN WE COULD GO TO THE MONETARY EXPENSE AND, YOU KNOW, MAYBE GOING AHEAD AND APPROVING A NOT TO EXCEED AMOUNT.

YEAH, I'M ON BOARD WITH THAT AS FAR AS THEIR BUDGET TODAY.

YOU KNOW, I MEAN, I KNOW THEIR BYLAWS STATE WE HAVE TO ADOPT THEIR BUDGET, BUT I KNOW STATE LAW SAYS IT DOESN'T.

WHAT WOULD BE YOUR RECOMMENDATION AS FAR AS THIS BUDGET THAT WAS PRESENTED US TODAY? GEORGE, DO WE LIKE SALARIES AND OPERATIONS? AND THEN EVERYTHING ELSE COMES TO COUNCIL AS A OR THE SALARIES AND OPERATIONS OF PREAPPROVAL TODAY UNTIL WE CAN GET ALL THE ARTICLES BACK.

WOULDN'T WE WANT? WELL. GO AHEAD, GEORGE, THEN WE'LL COME BACK TO COUNCILMAN SCHERLEN.

OKAY. I WAS GOING TO SAY IT REMINDS ME OF WHAT'S GOING ON WITH OUR FEDERAL GOVERNMENT RIGHT NOW WITH THE IMPENDING SHUTDOWN.

THE OBVIOUSLY, THE ECONOMIC DEVELOPMENT CORPORATION NEEDS TO BE ABLE TO PAY ITS EXPENSES AND ITS OVERHEADS AND ANY OBLIGATIONS THAT IT HAS UNDER CURRENT CONTRACTS INCLUDING THE FUNDING OF, YOU KNOW, EMPLOYEES COSTS.

I THINK THAT THOSE ARE ALL SOMETHING THAT WOULD BE APPROPRIATE TO APPROVE AT THIS POINT.

AND THEN WHEN WE GET THIS BUDGET DONE IN A LINE ITEM FORMAT WE COULD BRING THAT BACK AND HAVE YOU AMEND, APPROVE THE AMENDED BUDGET, AND THEN THAT WOULD BE IN PLACE FOR EVERYTHING ELSE.

OKAY. FURTHER QUESTIONS.

[01:05:01]

COUNCILMAN SCHERLEN, WHAT WAS YOUR QUESTION? WHEN WE SAID SALARIES, THAT WOULD EXCLUDE BONUSES, CORRECT? THAT WOULD JUST BE CONTINUED MONTHLY SALARY.

OKAY. I JUST WANT TO MAKE SURE.

RIGHT. OKAY, SO WHAT I'M HEARING YOU GUYS SAY IS, IS.

WELL, GO AHEAD. COUNCILMAN TIPPS.

WELL, I WOULD JUST SAY, I MEAN, FROM HIS RECOMMENDATION, WHAT WE'RE SAYING IS IT APPEARS THAT THIS HAS BEEN A HIGHLY EDUCATIONAL EXPERIENCE.

IT APPEARS WE'VE BEEN OPERATING OUTSIDE OF WHAT STATE LAW HAS PERMITS.

SO I MEAN, I WOULD BE IN AGREEMENT WITH GEORGE'S FIRM TO DRAW THOSE UP.

I MEAN, I HAVE NO PROBLEM WITH THAT.

OKAY. SO THE FOR ALL OF US TO UNDERSTAND, WE'RE NOT TALKING ABOUT AMENDING A BYLAW OR WORKING WITH THE, THE EDC BOARD TO COLLABORATE THIS, WHAT WE ARE NOW DOING IS WE'RE TURNING THIS OVER TO THE HYDE KELLY FIRM AND ASKING THEM TO AMEND THE ARTICLES OF INCORPORATION IN ORDER TO BE MORE CONSISTENT WITH STATE LAW BUSINESS PRACTICES, SO THAT WE COUNCIL THEN WOULD HAVE A PRACTICE OF PRE AUTHORIZING PRE-APPROVING EXPENDITURES THAT ARE GOING TO HAPPEN THAT WE KNOW ABOUT, THEN ADDITIONAL EXPENDITURES THAT COME UP, COME BACK TO THIS COUNCIL BODY.

SO ANY FURTHER DISCUSSION ON THAT DIRECTION.

OTHERWISE, I THINK I'M IN FAVOR OF THAT WOULD LIKE TO MOVE US DOWN THAT THAT ROAD.

I'M IN FAVOR OF THAT.

OKAY. OKAY.

SO, I WOULD SAY THIS THE NEXT STEP IN THAT WOULD BE YOU.

WE COULD HERE GO AHEAD TODAY AND APPROVE A BUDGET, A TEMPORARY FORM OF A BUDGET THAT THAT AUTHORIZES PAYROLL OPERATIONS AND ANY CONTRACTUAL OBLIGATION.

IS THAT CORRECT MR. HYDE? YES.

I WOULD JUST MOVE OR PUT IT IN THE FORM OF A MOTION TO APPROVE THE BUDGET.

TO THE EXTENT AND IDENTIFY THOSE AREAS THAT YOU ARE APPROVING.

SO I'M GOING TO ASK HERE IN A MINUTE FOR THAT MOTION.

BUT BEFORE WE DO THAT, I WOULD LIKE TO GIVE DIRECTION TO YOU FROM THIS COUNCIL IN THE INITIATIVE AND THE TASK TO GO AND AMEND THESE ARTICLES.

BRING EVERYTHING BACK TO COUNCIL AS SOON AS YOU HAVE IT READY.

SO THAT WE CAN MOVE THE, THE EDC FORWARD AT A COST NOT TO EXCEED $10,000.

IS THAT AGREEABLE TO YOU? OKAY. IS THAT AGREEABLE? COUNCIL? YES, SIR. YES.

WE DON'T NEED A MOTION ON THAT, BECAUSE IT'S NOT ANYTHING THAT WE HAVE TO ACCEPT OR APPROVE AS A CONTRACT.

SINCE YOU'RE ALREADY FACILITATING AS OUR LEGAL COUNSEL.

I THINK WE'RE GOING A GOOD DIRECTION.

AND THEN I STILL WANT THE PUBLIC TO HEAR US SAY WE'RE EXPECTING A FINANCIAL REVIEW TO COME BACK.

FRIDAY, WE WILL GLADLY UPDATE THE PUBLIC, AND THEN WE WILL RELEASE ALL INFORMATION TO THE PUBLIC AS IT'S YOUR MONEY.

IF THERE'S ANYTHING THERE THAT HAS TO BE REDACTED, IT'D BE VERY MINIMAL.

AND IT WOULD ONLY BE TO PROTECT CERTAIN, YOU KNOW, PRIVATE NAME OR INTEREST OF SOME SORT.

SO I DON'T KNOW THAT THAT WILL EVEN EXIST.

BUT I WANT TO COMMUNICATE TO YOU GUYS THAT INTERNAL AUDITOR IS STILL WORKING DILIGENTLY ON THIS.

IT WILL COME BACK TO THE PUBLIC, AND THEN WE WILL STILL CONTINUE TO TAKE ANY CORRECTIVE MEASURES THAT ARE NEEDED.

SO WE ARE LOOKING AT THIS AS TWO SEPARATE ISSUES.

ONE ISSUE IS THEIR BUDGET AND HOW HEALTHY WE CAN HOW HEALTHILY WE CAN CONTRIBUTE TO OUR EDC.

AND IN OUR CORRECT OVERSIGHT OF THAT BODY, WE WOULD LIKE SOME GREATER SPECIFICITY IN THEIR BUDGET REQUIREMENTS AND HOW THEY OPERATE.

OUTSIDE OF THAT, WE HAVE AN ISSUANCE THAT I HAVE CALLED UNLAWFUL BECAUSE I THINK THAT IS THE MOST ACCURATE DESCRIPTION OF WHAT HAPPENED, BE IT ILLEGAL OR NOT.

IT WAS UNLAWFUL.

AND WE WILL MOVE FORWARD ON THAT ISSUE SEPARATELY, AND WE WILL STILL CONTINUE TO TAKE WHATEVER CORRECTIVE MEASURES NEEDED THERE.

COUNCILMAN SCHERLEN, I SEE YOU UP ON THE MIC.

YES, SIR. MR. MAYOR, WOULD IT BE GOOD FOR MR. GERBER WHEN WE GET THAT INFORMATION TO FORWARD THAT TO MR. HYDE AS WELL? SO, I WOULD NOT ASK EUNEAL, TO DO ANY OF THAT.

I WOULD EXPECT THAT TO COME THROUGH MR. PATH. SO, EUNEAL WILL SEND THAT TO OUR CITY MANAGER.

AND THEN AFTER WE'VE RECEDED IT, ANY OF US CAN HAND THAT OVER TO MR. HYDE. IF YOU FEEL LIKE HIS EXPERTISE WILL HELP YOU IN EVALUATING THAT FINANCIAL REVIEW, YOU ARE BY ALL MEANS ABLE TO UTILIZE HIM AS A RESOURCE.

OKAY. THANK YOU. ANYTHING ON THIS SIDE OF THE COUNCIL.

I DON'T HAVE ANYTHING. NO, SIR. DO I HAVE A COUNCIL MEMBER THAT'S PREPARED TO MAKE A MOTION? TO BE CLEAR, THE THREE AREAS YOU SAID SALARIES, CONTRACTUAL OBLIGATIONS AND OPERATING EXPENSES.

[01:10:03]

AND TO GO AHEAD, MR. HYDE, AUTHORIZE THE EXPENDITURE.

SINCE YOU'RE APPROVING THAT PORTION OF THE BUDGET AND AUTHORIZING THOSE EXPENDITURES.

MR. HYDE, JUST SO WE CAN MAKE SURE WE GET EVERYTHING LEGALLY CORRECT, WHAT WOULD BE A GOOD FORM TO PRESENT THAT MOTION IN? WELL, I MEAN, TO BE THE MOST SPECIFIC WOULD BE A RESOLUTION.

I DON'T KNOW THAT YOU HAVE ONE PREPARED NOW, BUT IF YOU MAKE A MOTION TO AUTHORIZE ONLY THOSE EXPENDITURES FOR OPERATION AND PERSONNEL AND EXISTING CONTRACTUAL OBLIGATIONS TO THE EXTENT NECESSARY UNTIL WE COME BACK WITH THE NEXT AMENDED BUDGET THROUGH THE ARTICLES OF INCORPORATION.

SO WE DO HAVE ITEM THREE J.

THAT IS A RESOLUTION.

AND IT CONSIDERED A RESOLUTION KNOWING THAT WE WERE GOING TO HAVE A RECOMMENDATION FROM YOU, POTENTIAL COUNCIL AS WELL AS MR. PATH WITH THIS RESOLUTION COUNCIL, I THINK IT WOULD BE GOOD TO APPROVE THIS OR ACCEPT THIS RESOLUTION AND THEN OR I SHOULD SAY, ADOPT THIS RESOLUTION AND THEN TO ADD IN THE VERBIAGE OF THOSE THREE LINE ITEMS, DO I HAVE ANY, ANY ANYTHING I'M MISSING THERE, MR. HYDE? NO, SIR.

I THINK THAT WOULD BE FINE.

IT WOULD JUST NEED TO BE MODIFIED BEFORE YOU SIGN IT.

IF IT'S APPROVED. IF IT'S APPROVED.

VERY GOOD. SO MR. PATH, I WANT TO MAKE SURE THAT I'M DIRECTING STAFF.

WELL, WE ARE PREPARED TO ADOPT A RESOLUTION WITH THESE ADDITIONAL EXPENDITURES FORMALLY TO BE WRITTEN DOWN IN A WAY IN WHICH YOU GUYS WOULD BRING IT BACK FOR SIGNATURE. ANY ANYTHING YOU NEED TO ADD TO THAT, OR ARE YOU COMFORTABLE MOVING FORWARD THAT WAY? LOOKING BETTER? OKAY, GREAT.

COUNCIL WOULD ENTERTAIN A MOTION ON THIS.

OKAY. I'M GOING TO MAKE A GO OF IT.

I MAKE A MOTION TO ADOPT RESOLUTION 093024-1, AMENDED TO ONLY INCLUDE EXPENDITURES NECESSARY FOR SALARIES, CONTRACTUAL OBLIGATIONS, AND OPERATING EXPENSES.

SECOND. VERY WELL DONE.

WE HAVE A MOTION AND A SECOND ON ITEM 3J.

ANY FURTHER DISCUSSION ON THIS GUY? YES, SIR. ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? MOTION PASSES WITH A40 VOTE.

MR. HYDE, GREATLY APPRECIATE YOUR EXPERTISE, YOUR TIME, AND YOUR INVOLVEMENT WITH THIS COUNCIL.

THANK YOU FOR BEING PART OF THIS MEETING.

WE'LL LET YOU JUMP OFF.

THANKS, GEORGE. THANK YOU.

IT'S BEEN AN HONOR. HAVE A GREAT DAY.

THANK YOU. WE'RE GOING TO MOVE FORWARD TO ITEM 3K.

[3.K. CONSIDER AWARD - PHARMACY BENEFIT MANAGER SERVICES]

IF YOU'LL COME UP HERE, WE HAVE AN AWARD FOR, I BELIEVE, A ONE YEAR.

BUT YOU CAN WALK US THROUGH THAT FOR OUR PHARMACY BENEFIT MANAGER.

YES, SIR. GOOD AFTERNOON.

SO WE ARE PRESENTING THE COUNCIL FOR CONSIDERATION AND OPTION TO RENEW OUR SERVICES WITH MAXOR.

THAT'S OUR PRESCRIPTION BENEFIT MANAGER.

WE ARE RECOMMENDING TO COUNCIL A CONTRACT FOR A ONE YEAR RENEWAL FOR PLAN YEAR 25.

I HAVE WITH ME TY PETTY, WHO'S OUR CONSULTANT FROM HUB INTERNATIONAL, TO SPEAK MORE TO THE DETAILS OF THE NEGOTIATION AND THE TERMS OF THE AGREEMENT THAT WE HAVE COME TO THAT'S BEEN PRESENTED TO YOU ALL FOR CONSIDERATION.

THANK YOU, SIR. MAYOR, COUNCIL, IT'S GOOD TO BE BACK WITH YOU TODAY.

APPRECIATE YOU ALL HAVING ME IN TOWN.

MY SECOND TIME IN AMARILLO, SO THANK YOU.

CAN I GET THE NEXT SLIDE PLEASE? OR DO I HAVE THE CLICKER? PERFECT.

THANK YOU. OH THANK YOU.

NO, I WAS TUCKED UP UNDER HERE.

APPRECIATE IT. SO WHAT I'LL BRIEFLY DO TODAY IS WE'RE GOING TO RUN THROUGH A VERY BRIEF RECAP OF THE RENEWAL PROCESS THAT WE WENT THROUGH IN THE NEGOTIATION. AND THEN I'M GOING TO UPDATE YOU ON SOME OF THE KEY CONTRACT UPDATES AND THEN KIND OF SEE WHAT OUR NEXT STEPS ARE FROM THERE.

SO IF YOU'LL RECALL, WE WERE TASKED ON THE MEETING ON 13TH AUGUST TO GO BACK TO MAX AND RENEGOTIATE THE DEAL THAT THE CITY HAS WITH THEM.

AND SO WE BEGAN THAT INITIAL AGREEMENT AGAIN, APPRECIATE COUNCIL'S VISION AND LEADERSHIP ON THAT FOR US AND PROVIDING US CLEAR GUIDANCE.

IT MAKES IT EASIER AS YOUR CONSULTANT WHEN WE HAVE YOUR GOALS DIRECT FROM THE HORSE'S MOUTH, SO TO SPEAK.

SO REALLY APPRECIATE THAT.

YOU ALSO FORMED A BENEFITS COMMITTEE, AND WE MET ON THE 4TH OF SEPTEMBER AND FURTHER CLARIFIED AND REFINED THAT GUIDANCE.

AND THAT ENABLED US AT HUB TO GO BACK TO MAXOR AND PRESS THEM A LITTLE HARDER IN THE NEGOTIATIONS.

ONCE MAXOR PROVIDED HUB WITH THEIR BEST AND FINAL OFFER, WE RAN THAT THROUGH OUR ANALYSIS AND WE BELIEVE THAT IT'S A IT'S A REALLY GOOD DEAL FOR THE CITY,

[01:15:08]

SO OVERALL, THIS NEW CONTRACT AMENDMENT BEGINS JANUARY 1ST, BUT CERTAIN PROVISIONS TAKE PLACE START TOMORROW, OCTOBER 1ST, PENDING APPROVAL BY THE COUNCIL.

AND I'LL GET INTO THE DETAILS OF THAT HERE IN A SECOND.

SO THESE ARE THE KEY HIGHLIGHTS OF IT AND I APOLOGIZE.

THE SLIDES A LITTLE SMALL AS YOU CAN SEE ON THE COST IMPACT SIDE, WHICH WAS A BIG DRIVER FOR THE CITY, WE WERE ABLE TO INCREASE THE AVERAGE WHOLESALE PRICE DISCOUNT AMOUNTS ACROSS ALL CATEGORIES.

HE ALSO WAS ABLE TO NEGOTIATE A INCREASED REBATE AMOUNT ACROSS ALL THE DIFFERENT REBATE CATEGORIES AS WELL.

WE ALSO RENEGOTIATED UNDER YOUR CURRENT DEAL, THE CITY WAS ONLY RECEIVING ABOUT 80% OF THE REBATE FUNDS.

WE NEGOTIATED THAT TO 100% REBATE PASS THROUGH TO THE CITY FROM MAXOR.

WE ALSO DID SOME CONTRACT DESIGN CHANGES, AND THAT'S THAT TEN ONE EFFECTIVE DATE THAT I WAS TALKING ABOUT.

THAT'S WHEN YOUR NEW REBATES AND DISCOUNT PERCENTAGES GO INTO EFFECT UPON APPROVAL WOULD BE STARTING TOMORROW.

THAT ALSO INCLUDED WE NEGOTIATED AN EXTRA REBATE PAYMENT.

SO AND THAT'S PART OF THE NEW TIMELINE.

AS YOU CAN SEE, YOU GET REBATE PAYMENTS 60 DAYS AFTER A QUARTER UNDER YOUR CURRENT CONTRACT.

IT'S 180 DAYS AFTER THE CLOSE OF QUARTER, SO REALISTICALLY YOU'RE ONLY GETTING ABOUT ONE REBATE PAYMENT PER YEAR.

NOW YOU'LL GET THEM 60 DAYS AFTER THE CLOSE OF THE QUARTER.

SO WHEN THIS NEW PRICING TAKES EFFECT, WE'LL EXPECT YOUR FIRST REBATE PAYMENT TO COME IN SOMETIME IN FEBRUARY OR EARLY MARCH NEXT YEAR.

THAT WILL ENABLE US TO START EVALUATING THE TRUE IMPACT OF THESE CHANGES ACROSS THE BOARD.

FINALLY, WE CHANGED SOME STRATEGY.

WE CONVINCED MAXOR TO COME IN LINE WITH WHAT WE'RE SEEING ACROSS THE LARGER PBMS IN TERMS OF A HUMIRA AND BIOSIMILAR CONVERSION PROGRAM, WHICH THE CITY WILL ROLL OUT ON 1/1.

HUMIRA IS ONE OF YOUR LARGEST COST DRUGS.

ALL THE OTHER MAJOR PBMS IN THE MARKETPLACE HAVE ADOPTED BIOSIMILAR STRATEGIES TO TRY TO CONTROL THOSE COSTS TO THEIR MEMBERS, SO MAXOR'S AGREED TO THAT. WE ALSO NEGOTIATED THE AMENDMENTS TO GO IN ONE YEAR TERMS, PROVIDING THE CITY WITH A 90 DAY OUT.

SO THAT WAY, AS HUB GOES THROUGH AND EVALUATES THE CONTRACT AND EVALUATES THE PLAN PERFORMANCE.

THE CITY HAS THE OPTION WITH 90 DAY'S NOTICE TO TERMINATE THE CONTRACT WITH MAXOR AND MOVE TO ANOTHER PBM.

SO, LOOKING FORWARD, I'LL HAVE TO CAVEAT THIS STATEMENT.

WE'RE GOING TO MONITOR THE PERFORMANCE, BUT WE ESTIMATE THAT THE CITY COULD REALIZE BETWEEN 2.1 AND 1.8 MILLION IN SAVINGS.

MY CAVEAT TO THAT IS WHEN WE DO THIS EXERCISE FOR REPRICING, WE TAKE THE NEW DISCOUNTS AND WE RUN THEM THROUGH YOUR PAST YEAR OF CLAIMS. BUT PHARMACY IS A VERY DYNAMIC CREATURE.

IT DEPENDS ON YOUR UTILIZATION.

IT DEPENDS ON WHAT MANUFACTURERS DO WITH REBATES.

IT DEPENDS ON YOUR HIGH COST CLAIMANTS.

THERE'S A LOT OF FACTORS THAT GO IN.

SO THAT'S WHY WE HAVE THAT RANGE.

BUT WHEN WE PUT THESE NEW NUMBERS IN REPRICED YOUR PREVIOUS YEAR OF CLAIMS, THOSE WERE THE NUMBERS THAT WE CAME UP WITH.

SO WE'LL CONTINUE TO COMPARE THIS CONTRACT AGAINST INDUSTRY BENCHMARKS AS THEY COME OUT AND AS THE YEAR MOVES FORWARD.

WE'LL ALSO CONTINUE TO WORK WITH THE BENEFITS COMMITTEE TO IDENTIFY ADDITIONAL OPPORTUNITIES AND UPDATE THEM AS WE START TO SEE THESE REBATE PAYMENTS ROLL IN AND WE CONTINUE OUR ANALYZATION.

AND AGAIN, I APPRECIATE COUNCILMAN SCHERLEN, AND TIPPS.

I APPRECIATE YOU ALL TAKING THE TIME TO MEET WITH US ON THAT BENEFITS COMMITTEE AS WELL.

I KNOW THOSE AREN'T THE MOST ENTERTAINING CALLS TALKING PHARMACY, BUT REALLY APPRECIATE YOU ALL.

WEIGHING IN ON THAT AT THIS TIME.

THAT'S ALL I HAVE PENDING.

ANY QUESTIONS FROM COUNCIL? HEY, WE I THINK WE ENJOY WORKING WITH YOU GUYS.

I THINK WE'RE WORKING MORE EFFICIENTLY AND EFFECTIVELY.

WE GREATLY APPRECIATE THIS BENEFIT TO OUR ORGANIZATION.

AND HOW ALL OF THESE MONIES IN THIS BUDGET HELP THE ENTIRE ORGANIZATION, NOT JUST A SELECT FEW.

SO THANK YOU TO THE SUBCOMMITTEE FOR DIGGING IN.

AND THEN I WANT TO ENCOURAGE YOU TO CONTINUE PRESENTING THOSE IDEAS FOR COST SAVINGS AND BRINGING US IDEAS FOR IMPROVING OUR HEALTH BENEFITS. MR. MAYOR, APPRECIATE IT. THANK YOU.

YEAH, THANK YOU FOR YOUR TIME. AND I'LL POINT OUT I APPRECIATE YOU GUYS.

THEY DID BRING FORTH AN OFFER.

THEY DID TALK TO MAXOR THEY BROUGHT FORTH AN OFFER.

WE WEREN'T REALLY COMFORTABLE WHERE IT WAS.

WE FELT LIKE THAT THERE WAS SOME GROUND TO BE MADE UP.

THEY WENT BACK, PROBABLY NOT SUPER COMFORTABLE PRESENTING WHAT WE PUT FORTH.

BUT THEY DID BRIDGE THAT GAP BECAUSE THERE WAS STILL A LITTLE BIT OF SAVINGS WITH THE INTERLOCAL AGREEMENT AND THAT TYPE OF DEAL.

[01:20:03]

THEY WENT BACK AND NEGOTIATED HARD AND CAME BACK WITH EXACTLY WHAT WE WANTED.

SO GREAT JOB.

THANK YOU. AND I'D BE REMISS TO SAY, YOU KNOW, MAX WAS A GOOD PARTNER IN ALL THIS, TOO.

THEY NEGOTIATED IN GOOD FAITH WITH US AND SO CERTAINLY WANT TO RECOGNIZE THEIR EFFORTS.

AND YOUR POINT, COUNCILMAN TIPPS, WE WERE ABLE TO GET THAT ADDITIONAL 2% ON THE SPECIALTY PRICING, WHICH MOVED THE NEEDLE FORWARD.

SO THANK YOU FOR THAT GUIDANCE AS WELL.

THANK YOU, SIR. APPRECIATE YOU BEING HERE WITH US TODAY.

THANK YOU, MR. MAYOR. DO YOU GUYS HAVE ANY QUESTIONS FOR MR. NORMAN? NO.

I APPRECIATE YOU GUYS.

THANK YOU. AND THANKS, TOM AND DON, FOR YOUR HARD WORK ON THAT COMMITTEE.

OKAY, GENTLEMEN, THIS ITEM IS READY.

MAKE SURE I SAY THIS RIGHT.

I MOVED TO AWARD CONTRACT FOR PHARMACY BENEFIT MANAGER SERVICES FOR A ONE YEAR PERIOD TO MAXOR PLUS LTD.

I'LL SECOND. I HAVE A MOTION AND A SECOND ON ITEM THREE K, ANY FURTHER DISCUSSION ON THIS ONE? ALL IN FAVOR, PLEASE SAY AYE.

AYE. ANY OPPOSED? ITEM PASSES.

GENTLEMEN, ANY REASON WE DON'T NEED TO ADJOURN? THANK YOU FOR EVERYONE AND YOUR TIME BEING HERE WITH US TODAY.

YOU'RE ADJOURNED. THANK YOU.

* This transcript was compiled from uncorrected Closed Captioning.