City Council Workshop MINUTES June 10, 2024 at 5:00 PM  CALLTO ORDER  Mayor Sara Countryman called the meeting to order at 5:01 p.m.  Present:  Sara Countryman Mayor Carol Langley Cheryl Fox Stan Donaldson  City Council Place #1 City Council Place #4 City Administrator Finance Director City Secretary MPDI Lieutenant Public Works Foreman Waste Management Enterprise Fleet Management  City Council Place #5  Also Present: Gary Palmer  Dave McCorquodale Director ofPlanning & Development  Maryann Carl James Greene Joe Belmares Eric Standifer Tiana Smith JeffWarner  Kimberly Duckett CourtAdministrator  WORKSHOP ITEMS:  1. Review and Discuss the Waste Management Agreement and Proposed Increase  Alternatives  Gary Palmeri introduced the item and turned the item over to Tiana Smith.  Tiana Smith announced that she was proposing an extension of the current agreement which expires July 31, 2024. The current agreement allows for a two-year extension and two other options extend the contract by five years. She thanked the Council for allowing Waste Management (WM) to service the City for many years. She noted that this is a good time to evaluate the current services and see ifthere is anything that WM could be doing differently. She noted that since 2017, there have been several events that WM has worked through including 'snowmageddon" and COVID. She highlighted that the resources of WM allowed them to continue offering services to the City without interruption. Moving to the proposal, Smith explained that option one is a two-year extension, and options two and three are five-year extensions. She then elaborated that option one and two are extensions including the current scope ofservices, and option three is different in that it offers bulk collection once a month. She highlighted that the reduced volume allows them to use their automated side load trucks which was a reason that enabled them to operate throughout COVID. She said that option three may be agood option for the City. She said that bulky trash such as furniture and other large items are not typical for pick-up. She noted that out of 800 accounts, only about 10 utilize the service in any given week. Big picture - why are we paying additional money on a service that is not in great demand. She also noted two other items: 1) temporary needs such as graduation parties where they would provide pink tags; and 2) for more permanent needs, residents can choose to have a second polycart in cases where customers. need higher volume trash pick- up.  Page 11    CM Langley asked about the difference between option three and what the current contract Smith said that option three is different by reducing the weekly bulky trash to monthly bulky Palmer said that reducing thel bulky trash pick-up would save the City and residents considerably, Several council members noted that they were unaware that the service was even available. Smith detailed that heavy trash for 2023 was eighty-nine tons and that they do four open top  currently provides. trash pick-up.  especially because the service was not being widely utilized.  containers.  CM: Langley asked ifit would stop the four dumpsters on heavy trash days.  Mayor Countryman agreed that it might. She also noted that the last few times space was: not an  issue. She asked Smith how much cities sell the pink tags for. Smith said she didn'tactually know the average cost. Mayor Countryman asked what WM's cost was. Smith responded that $1.25-1.30 and they buy 500 at at time.  Mayor Countryman explained that ifbulk is reduced to once: a month, residents can buy the pink tags and tag their bags and the WM employees would know to pick them up. She noted that the CM Langley said that she would forget to get the pink tag and her garbage would sit there for  City would have to do great education to the public.  two weeks.  Mayor Countryman said the garbage would be the reminder.  Palmer added that this is for things that would not go in a cart such as from aj party. CM Langley added that they pick it up once a week now sO it does not sit, but ifit is once a month and she forgets to get the pink tag on Monday when her garbage is picked up on Smith said that the automated side truck would pick up the polycart and then the driver gets out Mr. Bono said that each account is allowed to have up to eight items. After eight items, a Mayor Countryman added that pink tags allow for two items each, so if she had twelve items she  Wednesday then it will sit.  oft the truck toj pick up the extra items. customer would need to get a pink tag.  would need two pink tags. She asked what the schedule would be.  Smith said that Thursdays would have everything but she would have to check.  Page 12    Mayor Countryman said this is good to know, because she didn'teven know this service was Smith said that there will also be virtual capabilities that customers can order the tags online in the future and the driver will know to pick up those customers who purchased virtually. CM Fox asked iftl there was any change with hazardous waste pick up where they call in to have  available.  it picked up.  Smith said there is no change to that process and iti is ai fantastic program.  CM Fox said iti is a fantastic program and that in twenty years she has used it one time. Mayor Countryman asked ifit doesn'to change current calculated prior year adjustment. Smith said if you were 23.75 now, this year the CPI is 5.34 SO that means starting August 1, 2024, we can only do a 5% increase so it would be less than CPI sO the rate would be $24.94. This $1.19 represents the difference between $24.94 and $23.75. Year two, this asterisk means that I am guessing what CPI is going to do. Itook the last five years of CPI, the rate ofinflation that will apply since 2019, and averaged those out, so its 2019: moving forward and since COVID there are: major bumps. Iwould guestimate somewhere around 5.1f for every yeari moving forward for those five years. I don't have a crystal ball or anything like that, I was just trying to find a way that you would be able to see what this would like in year three and forward just using CPI. So you can see year three goes to $27.55 because it's an adjustment of our estimated CPI it's $1.34, year four is $1.40, year five is $1.48. Now will be that same adjustment like we do now Mayor Countryman asked if we will be locked into these rates if we do the five-year regardless Smith said the starting will be $24.95 and after that it will only be adjust based on that CPI that wej just talked about, but I don't] know what that is going to be, but that average has been 5.1.  at the anniversary date. oft the actual CPI.  CM Donaldson said it depends on who is in the big house.  Palmer said that we are now on annual and if you remember that we. just renegotiated this last Mayor Countryman asked that if we did a five year will there be a drop in what we do now because its been annual and I am assuming that it was a higher rate or are you starting at that Smith said right now, in the last, we have been taking CPI adjustments SO starting in 2021 its 4.1, 2022 7.6, you can see that. What it doesn't show is how our expenses have outpaced, you know, and the main drivers for that is labor. If you remember, we had to get scrappy about keeping drivers sO we had to raise their rates twice. I think that for the first year for 2022 was 12.7and the following year was close to that. Really more than that was: fuel and of course CPI has a percentage of fuel in it, but if you compare just fuel from CPI, the changes, just fuel by itself, in 21-22 thei increase was almost 60%. That was natural gas. And then it went down al little  year and there is a CPI rider in there obviously their costs are exceeding that.  higher rate and then putting the discounts on? Does that make sense?  Page 13    the following year, but 7.6 was nothing close to what we. had to pay for fuel and driver labor as well. What you are seeing is if we did nothing and we did a two-year extension we would ask for CPI and an additional 10%. The point of option two is to take that same amount but spread itover five years SO it doesn'thit you in year one. So ifyouj just did the extension, that is $2.37 additional in that first year and then it bottoms out or slows down $1.40. Ify you look at option two, it's a fixed rate of increase of 7% and 7% for the same scope. Option three is different because we are able to gain efficiencies using ASL and not reducing bulk sO we are not sending  atruck out.  Palmer said you don't have to make a decision tonight.  CM Langley said its good to know to know what everybody is thinking. She said that she is  comfortable with Option 3.  Mayor Countryman and CM Fox agreed. CM: Langley said WMI has always done the city right. was great. Y'all did well and we appreciate it. CM Langley said we had good contacts.  Mayor Countryman said that COVID was Gnarly and there was some hiccups, but all in all it  Palmer said it would be nice to go: from a one-year contract to a five year.  Mayor Countryman agreed and said 1,000 percent, that's what I am seeing, the jumps can be substantial. She asked with our growth, do you doi it per household or per account? Do you know  how many counts you have in the City? Smith said 851 residential accounts.  Palmer said that ifwe go down this five-year routei in two years from now that cost that you guys are realizing is way about this 5% you guys would come back and renegotiate this right? Smith said we could only ask. Even in today' 's contract, if we needed an increase above CPI, we would have to ask, but! I ami not guaranteed that. Iv would have to come and ask you, and I am not guaranteed that. Iv would have to talk about it like Ijust did and either you approve it or don't. Mayor Countryman asked if we are locked into the five-year contract, does that mean if CPI Palmer said this locks us in to the 5.1 CPI rider but if their costs exceed that they are going to want to come back and renegotiate that or we would have to move on to another provider. Idon't want you guys to think that if you approve this five-year contract that it is set in stone. Is that Smith yes because the first year is guaranteed the 24.94, but after that is what CPIi is going to do. Ifwel have another COVID or something, what the contract would allow mei ist to address council and say we are asking fort this and eitheryous say. yes or no, but we still have to continue to service  jumps to 12%1 that we are locked into 12%?  fair to say? (to Smith)  you. Does that answer your question?  Page 14    Mayor Countryman said yes.  Smith said my contact information is in this letter, and this is a lot to digest. Ifyou get home or later next week, call me and ask any questions. Long and short is that we are asking for an extension either a two year orai five year. Ifyou want to change the service soi iti is less impactful pricewise, we say that is a good option because what we see in the streets. We think that is a  good option for you to consider.  Palmer said we would probably put this on the first meeting in July.  Council members thanked Smith.  2. Discuss Enterprise Fleet Management options for vehicle leasing  Palmer asked Carl to introduce the item.  Carl said that we are looking for options for vehicle acquisition to help us alleviate some cash flow issues. Jeff Warner is here with Enterprise Fleet Management to talk about an option that would help us ini that department. I will turn it over to him because he can explain it better than Warner thanked Council for their time and announced that he has been with Enterprise for 23 years. He has worked for many public partnerships in the state of Texas. We will look at the Montgomery fleet that we put together on an overview as of the state of the fleet and conversations we've had with Maryann, the Chiefofl Police, Public Works and ultimately what it looks like for a sustainability perspective. As you look at the State of Texas, we have 150 whether it's a city, County, University, or a school district. Al lot oft them you will recognize as being close inj proximity. Most recently Lamar University came on about two weeks ago. Similar to the City of] Montgomery, they were doing a lot ofs similar things in that they were buying and holding vehicles for anywhere from ten to twelve years and they didn'trealize their ability to get out oft the vehicle sooner to maximize their equity but also to control their operational expenses i.e. their fuel and maintenance which we have discussed in depth with Maryann and the Chiefof Police. The next thing I want tot talk about how we can reducei thel budget utilizing an open-ended equity lease. I did want to talk about that because it is a little bit different than a standard dealership lease. A standard dealership lease essentially means that there is wear and tear penalties, mileage restrictions, and at the end of term the dealership gets 100% of the equity. That's not what this is. This is open-ended and structured by department to make sure that you have liquidity throughout. There is no wear and tear or mileage restrictions and at the end of term, the City can determine ifthey want to extend the vehicle out or ift they turned in like a lot of our cities currently do to maximize their equity at term. What that does is lowers your total cost of ownership as it pertains to your fuel and maintenance but also maximize your right time to get out of your vehicle. Today Enterprise has over 1.5 million vehicles and we sell them at about 10-12% over black book. That truly where the City is going to see an impact to their total cost of ownership but also being able to replace vehicles sooner. We work with all major manufacturers; we will be meeting with you quarterly and ultimately looking at the total cost of ownership the incentives provided and proactively working with each department to make sure that we: are factory ordering vehicles in advance. Again, from an open-ended perspectiveitmakes al lot ofs sense for our clients because they are: not sinking all oftheirmoneyi into one depreciating asset and it frees up more capital in order to replace vehicles sooner. These are a few of the  Ican.  Page 15    benefits in addition to what we have discussed from the open-ended equity lease. Easch year we look at your line of credit and we adjust it accordingly. Wel look at thel budget and make sure we are working within it. And ultimately, ifit makes sense to replace vehicles each year to replace more vehicles each year based upon the budget. Ifit doesn'tt then we work to the following year, but the city ultimately has the flexibility to do SO. A little bit about the state oft the current fleet: today 25% of your vehicles are over 10 years of age or over 100,000 miles. As we discussed, older vehicles need more operational expenses as well as safety concerns as you continue tol hold onto vehicles longer. At your current acquisition pace, it would take essentially eight years to replace your current fleet. What we would look at doing is doing over a five-year period to condense that as well as look at the growth of the city to make sure that we can do more with less as it pertains to the budget. From a safety perspective 13% of your fleet is over 10 years of age, but as you hold on to those vehicles longer some oft those electronic stability features and other features in general are going to be outdated. So we want to make sure we are supplying the city with the most safe and technologically sound vehicles. The results by partnering with Enterprise is that the city would reduce the city's fuel cost conservatively by 24%, significantly reduce the maintenance by 78%, and leveraging the open-ended equity lease allows the city the ability tol be able to: retain all equity while using that equity towards future vehicles and replacing vehicles sooner. The plan we put together over ten years would save the city conservatively $648,000 and put them in a strong equity position moving forward. This is an example of what we shared in previous meetings and what the analysis would look like moving forward. On the left side you'll see the city's fleet, 24 vehicles currently in fleet today. Your current average age is six years and your average annual miles is close to about 10,000 miles which: is similar to what we see with al lot oft the other cities that we are working with. Today as we look at the criteria for each year to replace units, it matches the criteria up: in the far-right hand corner. So any vehicle that is ten years or older, or more than 100,000 miles we would look at replacing in year one. In this case, we have six that meet that criteria. In year two you have two, four, six, and then SO on until they are fully replaced and implemented by the five-year period. All of this information goes into the next slide which is the budget analysis that we put together. 24 vehicles currently in fleet, again your current cycle is eight years based on replacing three vehicles annually. Your current maintenance program is based on thirty cents a mile. Thiry cents per mile is essentially anon-emergency vehicle. I was very conservative with these numbers. We know that with emergency vehicles with a high idle time is typically thirty-five to forty cents per mile. As you look at the gold bar, that represents what you are currently doing today. So 24 vehicles in fleet, replacing three annually,your purchase budget is $128,000, and you do see some equity coming back to you - $15,000. You'll see your maintenance of $74,000 and your fuel expense of $61,0000.. Alli in, to runt that current fleet today you are looking at a cash budget of$248,000. On the enterprise program, we are able to replace vehicles sooner, but then you will also see that the equity that you. have in the fleet we are using that sooner as well to replace vehicles sooner and to lower your expense. By replacing vehicles sooner, you will see your maintenance drop, your fuel cost drop, and your overall budget again would be close to $648,000. This just gives youa state of the fleet, we didn't want to share this in depth, but wel have reviewed this with Maryann and the Police Department as well as Public Works. Moving forward, if there are vehicles you want to: replace, you dol have equity in the fleet today, close to a little over a halfmillion dollars that you can utilize to replace more vehicles in the budget. So what we did was put together a budget for two police vehicles that are currently on the ground getting outfitted that we can intercept and add to the program and we also put together a budget for replacing four of the police units and two oft the public works units. Essentially, you will see each year spent, and this is inclusive of the police department and all heavy equipment as well, and your total cost is $136,000. If you go and purchase those two vehicles today, it is $133,000 dollars. So what it does is free up capital each year for us to replace vehicles sooner. For the fiscal year budget  Page 16    you'll see the combined budget to replace four vehicles in police and two vehicles in public works is $168,000 and after term your total spend, and this includes full maintenance on all public works units, is $394,000. So again, it gives the city the ability to replace vehicles sooner, fix your budgeted maintenance program, and also be able to replace vehicles sooner in a shorter term. The cost for the city today when we ran the mathj just to replace seven units alone, and this doesn'texist to any other maintenance program with that included is $399,000.. A little about the maintenance program. We have two different maintenance programs. A full fixed bid budget maintenance program for any new vehicle that you procure from enterprise. You can outsource itt to the local tax base, and all maintenance preventative and non-preventative is covered. What that does for the city is give you the ability to have more control over what your costs are per vehicle and ultimately see when ist the right time to get out ofa vehicle. The other program is the bridge program which is 10 dollars per month. You can elect tol have that added to any existing vehicle int the: fleet. It gives the city the ability to utilize the same shops on the network, but also have: more control over what your costs are, and truly see what your costs are: from aj maintenance perspective as well as an operational perspective as we do also track the fuel that goes along with it. With that, we do offer all oft the technology that goes along with the fleet. The entire fleet will be uploaded to a dashboard. You will be able to see each vehicle, each cost, and have a better understanding ofv when is the right time to replace a vehicle as well as the analytics to back it up. Thisi is the reason why we currently have 150 partners in the state ofTexas and why we continue to grow, and why Itruly believe that working with Maryann, the police department, and public works is a great opportunity tol build a long-term relationship with Montgomery. Mayor Countryman asked if there is a vehicle and it's a lemon, we are seeing through the dashboard that there is a lot going on with it, what is your policy for that? Warner said that ifitisa al brand-new vehicle there is al lemon law and we would fight that on your behalf. Enterprise right now, 1 out of4 vehicles on the road is an enterprise vehicle. So we would Mayor Countryman asked who determines that? Do you say ok, ifi it's over $25,000 in a year Warner said we would go to the manufacturer on your behalf, and we would decide that collectively with the city. Ultimately, it is the city's vehicle so you can decide. Mayor Countryman said soi ifit's Mike ori its Chiefand they say hey Ithink something is wrong with this. I'm just seeing ifi its us saying I think we need help ori ifit'sy you going - heyIsee. Warner said yes. To go a little further, on the maintenance program, we have 1,100 ASC techs in St. Louis. Theirj job ist to track and audit any maintenance and ifthey see any outliers theirj job Mayor Countryman said sO y'all have your own eyes along with ours so that is proactive.  go to the manufacturer for that vehicle to be replaced.  that might be a lemon?  is to prompt the Chief or whoever is responsible for the fleet.  Warner said Yes Ma'am.  CM Langley asked where is the closest network shop?  Warner said that he can send a list. Iknow we have five shops within seven miles, but) I can send CMI Langley said she didn'tneed it. She asked LT. Belmares ifhe has seen the list.  you a link with all of the shops that are currently within the program.  Page 17    Belmares said that he has seen the list and that we use a lot ofConroe's fleet maintenance center  because they have the lowest hourly rate that we have seen. Mayor Countryman asked ifiti is an enterprise fleet.  Belmares said that we talked to enterprise to check and see ifthey because there isn'tany reason  that they shouldn'tbe.  CM Langley asked ifthat is because there isn'tone between here and Conroe. Belmares said that there are, but their hourly rates are higher than we have seen in Conroe.  Mayor Countryman asked ifit was significantly to cover fuel?  Belmares said we' re talking from $85 an hour to what we see here now is anywhere between Mayor Countryman asked SO when you say when you are on ai network shops, like insurance like a doctor is on the network, I am assuming that we will see your list of network shops and we would pick from there. Ifthey are: not on the network, likeifJoe'sis not on the network, is there Warner said that there is no penalty to it, if we wanted to add another network or shop to the  $125 and $160.  aj penalty?  program we certainly could.  CM Fox asked ify you have aj particular criteria that a shop has tol have?  Warner said yes. They are tracked and audited, and these shops are piggybacked off ofusing our rental facilities SO a lot of our rental cars go through them as well. There is a lot of checks and  balances to make sure that not only the work is quality but the right price.  CMLangley asked what city they have had the longest.  Warner said that Beaumont has been part of the program for five plus years. Icould pull that list for you. II know Brookshire was: in a similar situation last year. Wel had to replace seven vehicles last year very quickly with a limited budget and they are already on a second round. CM Langley said that she saw that Navasota was on something, how long has Navasota been  with you? Warner said five years.  Palmer said this is quickly becoming a best practice.  Mayor Countryman said I don'tt think the program is that old isi it?  Palmer said Roswell had it. They loved it. Mayor Countryman said the cost savings is dramatic.  Page 18    Warner said that we have been in the emergency response sector for the last five years which enterprise has jumped on to, but we have been int the government sector for twelve years now. CM Donaldson asked what are we leasing? Are we getting a stripped-down SUV with A/C and Warner said that we work with the city and you decide which vehicle makes the most sense and we order on behalf of the city. You determine what trim level you want and you decide what  power windows and interceptor: motors sO the police can catch the bad guy?  aftermarket you want on it.  CM Donaldson asked about the outfit oft the car.  Belmares responded and said we have an outfitter local here in Willis. The vehicle will be CM Donaldson asked SO we are getting the vehicle and when we get it, we get it outfitted.  delivered to them and they will add the camera's) lights.  Belmares said yes.  Warner said we can do that for you. Wel have some cities that want everything rolled into one. We have some cities that decide from a budgetary perspective that they want to do it on their  own.  Mayor Countryman said sO that's nothing different than what we do today.  CM Fox asked what the cost ofoutfitting the car costs.  Belmares said $22,300 for one unit.  CM Langley asked you said you do a credit check on us?  Warner said each year we look at the line of credit and if you need an extension based on the Mayor Countryman asked if Warner is the local representative?llike tol know who Ia am dealing Warner said I am local, but you will also have a client strategy manager who will be meeting with Maryann quarterly as ai financial analyst to look at the financial stability of the fleet. Carl said that Wallerimplemented this about a year before Il left sO, I am familiar with all ofthe people. And to your point Carol, finding out who's had this program, when I was doing the research on the Waller side I spoke with the financial folks with Beaumont, from Vidor, from Katy, SO Ig got a lot ofadditional information of what their experience was, what their challenges in the beginning were. One of the things I think is important to note on there is when he talks about intercepting thei two vehicles that PD: has already ordered, ify you see that up there the cost this year would be $68,000 and we budgeted $150,000 for those two vehicles. So, there is an immediate savings right out the door with not having toj pay that full $150,000 up front. It allows us to get additional vehicles each year and keep our costs down because they work with us to make sure we are getting the max out of each vehicle when it makes sense to turn it in and get  vehicles you want to order in advance.  with.  Page 19    greater equity out ofit. Ini the long run you are looking at a pretty comparable cost over: five, ten- year period oft time, the difference is we are able to get seven vehicles and not just three. Mayor Countryman said I trust what y'all are doing but it is great to have another set ofe eyes on it too going hey have you considered. Ifthere is a change in leadership, we want to make sure it Belmares said that he talked to Katy this morning and Katy said they have seventeen cars sO far and with the program for four years everything has been great, and they have no cons. Their captain over there, who is over the detective bureau, and] Iknow him personally. .Iwill get some Mayor Countryman said get the downlow maybe because y'alll know each other he will tell you. CM Fox said the good thing about it tooi is you don't have a vehicle that goes out ofs service for any number of reasons, and you have to have the resources to find somebody to get rid of the Carl said one of the things we talked with Mike about was allowing him to keep one of his vehicles as a back up or reserve sO that ifa vehicle does go down, he is not out a vehicle while  doesn'tslip.  feedback from him as well.  vehicle and that's another plus on this, It think.  it gets fixed.  Mayor Countryman asked how many vehicles Mike has, is it five?  Palmer said maybe, ifiti is five it is four now.  Mayor Countryman said oh no. That's not good. So, you mentioned two for him sO that's 50%  ofo our fleet? Ok. Same thing, so he would have to send it out to get outfitted?  Warner said correct.  CM Donaldson asked based on the figures that wel have accumulated so: far, we are talking about  turning the fleet over every five years, is that correct?  Warner said correct.  CM Donaldson said SO we aren'tg going tol have ten-year-old vehicles anymore?  Warner said ultimately from a budgetary perspective there is years where the budget is slimmer than other years. So, it's an open-ended equity lease. If the equity makes sense to turn in the vehicle sooner, a half ton truck, a three-ton truck, with no aftermarket and there is more equity, then we would give you the advice to do that. Ultimately the City Council can decide what makes Mayor Countryman said thiss sounds really shiny, but where is the con tot this? Atl least something. Warner said that is a great question, but there is no con to it. Ultimately we are doing more with less than your current budget today. Today you are funding an entire portion ofa vehicle, we are only funding aj portion ofit." That'sallitis." Ultimately we: arei meeting with you each year because we are not in this to lease a few vehicles, we are in this to build al long term partnership. As big  the most sense from al budgetary perspective.  Page I 10    as Texas is, everyone talks. Our credibility is at stake, my credibility is at stake, SO we want to CM: Donaldson asked SO with leasing we don't have to be concerned with depreciation? Mayor Countryman said cars are not really assets. They depreciate when you use them and we Carl said this does not go on the depreciation schedule like you are used to seeing it becomes part of a Gasby reporting. Auditors take care of all that. I am very familiar with that. CM Langley asked ift they are City ofl Montgomery vehicles, wel hold the title?  make sure that we are very transparent with everything.  own everything we. have.  Carl said we will not hold the title.  Warner said that we hold the title but you hold the equity.  CM: Fox said this is just like if you would go to Demontrond and you leased a vehicle.  CM Langley asked ifour insurance that we carry nowi is adequate?  Carl said yes, TML covers these.  Mayor Countryman said we. just pay for what we use basically.  Warner said that is a very good way toj put it.  CM Fox said that ift the PD and maintenance is good with that, then that iti is good because y'all Mayor Countryman said and II know that Public Works has had some problems with cars going down and they've had to pinch. So, knowing that we have a backup and a partner to help us get  are in the car business.  out oft that pinch is good.  Palmer sO the: next stepi is the agreement?  Carl said yes, Ihope to do that at the second meeting this month. Ihave already forwarded the agreement to legal. Standard lease agreement that all the entities have gone through. And then Warner said that is a great question. So, a lot oft the cities now are ordering proactively. The goal would be ifv we got the partnership started in 24 to order the vehicles before the end ofthe month knowing that these vehicles are: still six months out before those vehicles land SO it doesn'taffect  the order banks, hopefully we can still get in on that?  the budget.  Mayor Countryman asked how we decommission the vehicles that we have now.  Warner said if they are not police vehicles enterprise can sell them on your behalf. If they are police vehicles, the police department would have to decommission them enterprise could sell  them as well. Page 111    CM Fox asked if we can use the same equipment with the next vehicles?  Belares some of it we can. Since we have a fleet of older cars the interiors change sO the  likelihood ofdoing that is pretty slim.  CM Fox asked if there is a way to recycle it to a smaller city?  Belares said yes.  Mayor Countryman asked what the program looks like to decommission and get the new, is this Warner said that it is a five-year phase in approach. We would phase it in with your oldest vehicles first and each year meet with Maryann, public works, and your police department on  at two-year program toi roll out?  which vehicles make the most sense.  Mayor Countryman said if we are getting seven right off the bat that's a big start.  Warner said that is correct.  Mayor Countryman said if we are getting seven vehicles VS. two, that is significant.  Warner thanked Council for their time. 3. Discuss FY 2025 Budget  Carl introduced the item and asked Council to return their binders from last year's budget and said in July she will put sheets in them. She said she wanted to point out a: few things from the last meeting where they talked about increases, especially under admin. This is where you can see where we are talking about legal notices. We are overbudget now, as we have more things come up, we have to do more publication. And sO we have increased that number pretty significantly. We have also put some additional funds in this next year in recording fees as well as community relations. That is primarily for additional meetings, the meetings for the crime  control district, that kind of thing.  CMI Langley asked about community relations.  Carl said do you remember how we talked about having a marketing campaign for the Crime Control District? There might be workshops, there might be things of that nature that go into  that. So, this isi in case we incur costs for that. Mayor Countryman said the Waste Management change. Palmer said it'sa al lot ofs stuff, a lot of planning stuff.  Mayor Countryman said we are going to have all the planning meetings. Are you sure that is  enough?  Carl laughed and said this is the number that was given to me.  Page 112    Mayor Countryman said no worries.  CM Langley asked wel haven'thad it somewhere else labeled as something else?  Carl said those are community relations items. You can see we. have al bunch ofthings under that item and wel have spending in that item. Some of the things we. have seen increases in this year inc community relations. Gary does the monthly meet the administrator and there is coffee for that. We also have in that line some sponsorships as far as membership to the Chamber of  Commerce, that kind ofthing.  CM Langley asked if vendor subscriptions went there.  Carl said that is not where that goes. One ofthe things I did want toj point outi is under that records request, the FOIA program. You will see that we are definitely overbudget this year and wel have budgeted $6,300 for next year. This got overlooked in last year's budget. We are in the third year; we are going into the second and third year, The first year of that agreement we got a discount. Wea arei no longerina asi muchofadiscount. So, we wanted tos make sure we: are capturing  that.  Mayor Countryman asked who is they?  Carl said JustFOIA. The group that has that software for the public requests. That is the program  that tracks that. Legal fees expect that to go up as things are going on. Mayor Countryman asked Alan? You aren't getting any cheaper?  Carl went on to say increased cost of election. We know with the Crime Control District that  will be on the ballot for November.  Palmer said Ia am still waiting for the cost oft that. CM Langley said thank you, you. know I was going to ask.  Carl said computer technology in this line, there are some computers needing to be replacement, we are looking at adding a scanner or two for utilization with InCode on the AP: side. This is that InCode license under that KKC agreement. So, we are trying to capture all ofthose things that would be in there. Software upgrades. This is the item I talked about last workshop, the GL conversion piece. The desire for the budgeting software ifwe can fiti it in there. There might be some things for the new City Secretary. Other than that, I don'thave any other large things to note other than I am looking at moving general items out of that printing and office supplies to this operating supplies. You can see that we used to used operating supplies in this department and we stop using it. Operating supplies are generally those consumables that are not related to office supplies, paper plates, toilet paper, paper towels. So, Ia am looking at moving those out, CM Fox asked ifN Maryann was suggesting that all the employees bring their own toilet paper? Carl said I am not. Ijust don't like that those, because it does. This is one oft the things that we talked about last year in that printing and office supplies and we talked about WoW we are spending al loti ino office supplies. Because there isi more than just office supplies in there. Looking  but I am still looking at it.  Page 113    at Public Works, we talked about this at last workshop. Under billing repairs for City Hall, this includes the painting of the exterior of City Hall. Everything else is basically about what it has been this year. The only differencei is onj page two, you) have halfofat truck. So, the truck utilized in Public Works, halfv will come out of water/sewer. Now this number of course is question mark at this point because if we move to this other program, that will be al little different. And then at the bottom of this page, Gary, you will see that we put back the $250,000 for contract labor-  streets.  CM Donaldson said All right!  Carl said we will see if we can swing that because as Mike said, all that happened from taking it out ofhere, we didn'tg get it done. We ended up with more capital projects and that just ate it up. CM Donaldson asked ifthat contract labor we. just spent, that's all labor costs?  Carl said its contract labor for street repairs. It has to do with major street repairs. If we have ABC contractor do all of that street repair replacement. Remember he has had, going through the process of grading the streets and coming up with a plan of prioritizing what streets need work done. So that is one ofthe things that they have been working. So once that comes through Mayor Countryman asked hey Maryann, for elections. Ithink that council talked about extended the tenure of council from two to three years, should we. just put all of that on with police?  there is work to be done which is why he put that ini there.  Palmer asked ift that has to go through the voters. Mayor Countryman said yes, the term does.  Palmer said Ia am still waiting to hear back on the cost of the Crime District.  Mayor Countryman asked ift there is anything else that we: need to put in front of voters that we  can throw on there as well.  Palmer said Ic can'tt think of anything offhand.  Mayor Countryman said that wasn't ta trick question, I'd like to throw everything on there since CM Fox asked why if they are already having that election why would there be charges for  we are spending money. another item,  CMI Langley said it's an extra election. Palmer said it'sjust another question.  CM Langley said Iunderstand that, but Montgomery does not have a November election, it has al May election. The City ofMontgomery. So, when it's not an average election, they can charge.  CM. Fox said they can, and they do and they will.  Page I1 14    Carl said alright, next wel have the Police Department. I will note there is one error that I did not catch when it came over from chief and that is community relations. I don't believe that it is $65,000, Ithinki iti is $6,500. The other thing, auto repairs is increased. Going with the enterprise option that may fluctuate a little bit. The only thing that we: need to keep in mind is if we won't be getting these new vehicles until mid-way through the fiscal there might bes some costs that we Mayor Countryman asked sO then what is that, every year have we been averaging $10,000 for  still need tol be concerned about. the first six months.  Belmares said we ate through that pretty quick as soon as it hit the ground.  Mayor Countryman said that it might be smart just toj put that full amount and give it back ifwe Carl said that is a good idea and what shei is most comfortable with. Idon'thave any other major items on here. You will see on page two ofPD we did not put an amount on police cars because we were waiting to see what we are talking about this evening sO we will have a better number for the. July workshop. Also has a note about making a change on this Tyler Public Safety which Belmares said we are looking to go Spellman with the Sheriff's office and this will streamline the reporting system and make it a lot easier once things get moving forward with the future of the agency. We will have paperwork that is identical to the Sheriff's office and it will limit a lot Mayor Countryman asked you mean. he will be able to do all ofhis paperwork here and when he Carl said the second item on this page is a capital outlay office for maintenance and it appears that the name has been adjusted at some point. Keith has told us that this $11,800 is for Belmares said that they are the high-rise vehicles. Right now, one is down and one isi in repair.  don't use it for the whole year.  Ithink we talked about a little bit at last workshop.  oft time that it takes an officer to go down there and book aj prisoner.  gets down there, Iknowi it is laborious. And it is good to talk to the County.  maintenance on the LMTV's. Not office maintenance.  We actually used it in this last storm to save: some kids off ofa a school bus. Carl said that that line will be renamed something more appropriately. CM Langely asked ifl he wants it kept at that amount.  Carl said yes at that amount.  Mayor Countryman asked ift they fire those up weekly.  Belmares said that they drive them once a week and do maintenance. Sometimes our vets will Carl said next you have court. One thing to note on here is records management and retention, there has not been a line for destruction of old items under the retention policy sO we have  come up and drive them.  Page 115    included that. This year when they came in, they identified more things that need to be disposed  of.  Mayor Countryman asked ifthat is not the shredding?  Carl said it is, however, the service comes in and does the records retention schedule. They go through and make sure these items need to be kept for three years, these four years.  CM Langley asked ifits] just been under general. Carl said no in the past it has just been kept forever. CMI Langley but the shredding guy would come?  Carl said sO the shredding isj just the shred bins, not the disposal of old records.  Mayor Countryman asked how long records need to be kept.  Duckett said five years. This is the first time that we have done it properly and I think it goes  back to 2013.  CM Langley asked if they had to pay someone to do that.  Court Person said to do it legally,yes. CM Langley asked ifit already cost that much. Duckett said Ithink the Court had the most boxes.  Carl said that it is a very reasonable price based on the amount of hours they were here. They  were here a couple of days.  CM: Langley asked, sO they took them with them? What did they do?  Duckett said that some of them I was afraid to get rid of, but Il had to. Some of them had to go off site because of the time frame, and some are back in our records room and have a label on the front with the date that needs to be destroyed with a list ofwhat isi in there. Carl said it was more about holding on to things past their retention. Ok, we had ai reduction on CM Langley said and that one-line item up there, you went from 12 to 10, general consultant  computer technology line and that is about all at this point.  fee.  Carl said which one?I I'm Sorry. Oh. CM Langley but you only spent $410. sO far.  Page 116    Carl said that is as of March, sO we have spent more at this point. Some of this is your title consulting. This has to do with programs that the Court utilizes. But remember that this is a stationary point in time that year-to-date as ofl March 3151. Any other Court questions? CM Langley said on operating supplies you went down quite a bit. Because you) have only spent $570. Why would you go down on operating supplies? Are they also on printing and office Carl said historically their costs have been below what's budgeted. And this is one of those departments that does have operating supplies broken out fromj printing and office supplies. CM Langley said I don't know that I would go down on operating supplies, that much.  supplies that you went down?  Mayor Countryman said Carol is giving away money! CMLângley said welll Ik knowIa am going to get my street fixed!  Mayor Countryman said She is feeling good!  CM Langley said the Crime District is going to bring in all that money and she is going to get her street fixed. Andi it is bad! All my neighbors are walking and looking at it and taking pictures Carol said alright, sO now we. have water and sewer. Wet touched on this a little bit last time with the cost ofthe operator line coming down because this is under the Hayes contract. They separate out your operating costs, your testing costs, and your preventative: maintenance. So,yous adjusted that accordingly in the budget. Reduction in sludge calling because they have made repairs sO they don't have to send off as much sludge. The other slight increases are based on trend and what mike sees for this next year. Iapologize the next page on the repairs and maintenance we went from $300,000 to $325,000 and I don't have my note as to what that increase was sO we  ofit.  will have to ask Kim about that.  Mayor Countryman asked what that halft truck cost mean?  Carl said remember that this is where public works pays half, and water/sewer pays the other  half.  Mayor Countryman asked what is employee relations, is that like lunches?  Carl said employee relations is the line that is used for like during public works employee week, the luncheons. Things along those lines. This is where we see under preventive maintenance,  this is that other part oft the contract, sO we see the increase there.  CMI Langley said credit card merchant fees.  Carl said yes, sO those are the fees that we pay to accept credit card payments. So when somebody  makes aj payment on their utility bill, like when they pay online, we get.  CMI Langley asked but yous moved it to where?  Page 117    Carl said no Ihave not moved it.  CMI Langley asked but it needs to stay under water and sewer right?  Carl said this is for the utility side SO it will definitely stay there. You've seen an addition ofthis item under the General Fund because we. have not been paying credit card fees. Water and Sewer has been absorbing all the credit card fees even when they are paying for a permit, even when Mayor Countryman asked what is that second one from the bottom? It was KPL projects?' ?There Carl said thati ist the one last year we talked about using your operations funds to fund your capital projects is not always the best practice. That's where we did the debt issuance for this last year. We are going to be coming back to you with the capital projects for this next year. It doesn't mean that the water and sewer fund wouldn'tnecessarly be used on capital items. Wel have some items that we will be looking at potentially using some surplus from water sewer to fund those, but not as ai routine practice of supplying the funds to the capital project as ai routine. Does that makes sense? That is why there isn't anything in there. Any questions on any of these items in here? In the next workshop, you will see Ia am updating payroll information. Remembering this, we have nine months under the old rate, three months under the old, nine months with the cost ofliving adjustment. Ican'tjust transfer over ar number, Ig gotta put that all into worksheets. Iam getting back the information on insurance projections both health and property liability. Also looking in on some of those things that we talked about last year like telephone and what we are covering underneath there. I have great spreadsheets if anybody would like to entertain themselves. In looking at those lines, telephone encompasses a whole lot not just the telephone at City Hall. Its telephone, any time therei is telephone reimbursement to an employee, it pays for the answering service on the water/sewer side, its all of those auto dialers at the plants in case something goes down. So there is all kinds of components that go into it and not just telephone and sO we are working at looking at those sO we can get you a better description when you see those numbers and aren'tlike wait, wej pay that much for at telephone number? Sot those are some Mayor Countryman asked do we feel like our health insurance is online? Itj just looks like there Carl said sO there is huge jumps. You may recall last year we were able to get TML tol hold toa Mayor Countryman asked if we have the best insurance. I remember that we didn't go out and Palmer said we were going to go out and shop but that's when TML came back with 0%, you are not going to get any better than that. As far as the level ofs service we. are getting obviously it could be better. Ithink ifyoupolled the employees they would want betterinsurance. Right now,  they are paying for a flag. And so, we. have separated those out.  has been historical, 37205?  ofthe things that we will be bringing to you on July 8.  isl huge jumps.  noi increase which was huge for us.  shop to make sure that we are getting the best bang for our buck.  we cover employee, employee spouse. There is no full coverage. Half.  Mayor Countryman asked half for the kids?  Palmer said yes. For cities, it's good. There is al lot of cities that cover 100%.  Page I 18    CM Langley said that we have changed insurance before. But we always go back to TML. Palmer said They provided a couple extra benefits as I understand. That next level. Belmares said they have next level prime which is a collection of clinics where employees and dependents can go to those if you are sick or something at no cost. It is not like you are walking into the Ritz Carlton but iti is a very nice set of clinics. Ihave been to a couple. Carl said that dependents do not have to be covered to use that option.  Palmer said it's been a great benefit, I don'tknow, LT. do you want to talk al little about that?  Belmares said he has used it) himself and it's been really good. Mayor Countryman said but you don'tl have any kids. Duckett said I use it and my son used it and he is an adult.  Mayor Countryman asked department heads what is the feedback from employees? Do we. need  tos shine it up or do something better? CM Langley asked ifit was. Blue Cross? Carl said yes, it is Blue Cross.  Belmares said he would dig in and get feedback from staff.  Mayor Countryman said she was just curious, if we were mediocre at best maybe we could get Carl said that in talking with the TML rep one of the things that we. know is that it goes by your loss benefit ratio. We did have quite a loss sO the fact that they were able to get us at zero they knew we were. looking. That is ai major thing. One ofthe other advantages is that you are part of al larger pool. When you go on your own, we are a small group of less than fifty people, SO you CM Langley said that we can'tafford it at Jim' 's because we have less than fifty, well we have twenty employees, sO try toi find insurance for twenty employees. Wel have blue CrosS blue shield Carl said that between Nici and I, we would get people who had concerns or questions or didn't get their full benefit. But we haven't had any ofthat since the first oft the year. Mayor Countryman said ifit ain't broke don'tfix it, but at the same time, ifyou could get more Carl said that there are some additional features at TML that we don't take advantage of. TML has a HRA card, an employee does not contribute but the employer does. We did this thing in Waller where we would load this card with $100 every month. So that was a $1,200 benefit for the employees that they could use for the dentist, for their prescriptions, for their eyeglasses.  al little more with less.  are looking at it being.  but there are only three people on it because they can'tafford: it.  for. Ihadn'theard any rumblings.  Page 119    Mayor Countryman said that is a huge benefit.  Carl said that there are some additional benefits that they offer but] Idon'tknowi ifv we would get that. We don't take advantage oft that and there are some things that we can tweak and keeping that in mind that might be something we can take advantage oft this next year.  Palmer said we are always ready toj jump.  Belmares said that any additional benefits for our officers for their families is definitely something that we can use. It's minimal because you might have, if wel have twelve officers and maybe four families, sO its not a whole lot of being extra to cover those families and make the Mayor Countryman said I know we were really expensive a few years back and there was basically no benefits to anybody with, it was gnarly, remember that four years or five years ago? Standifer said they asked me three times ifI was sure I wanted to sign my dependents and they  department more attractive to other potential officers.  said you are, going to be the only one with dependents.  Mayor Countryman said that was gnarly, SO as long as it has gotten better.  Palmer said sO right now, dependents are 50%. Belmares said that spouse and dependents are 50%. their dependents. And we are always looking at that.  Palmer said SO if we were to poll the employees, that's what they would want is coverage for  Mayor Countryman said, and I know it takes time, that's not a fun subject.  Carl said our renewal is January 1, sO we don't normally get, right now they are doing the renewals for October 1, SO we normally get our numbers in August or September. But we will Palmer said if there are other opportunities out there, we will look at them. Also, at the next  know here this month kind of what that average percent increase is.  workshop we will have the CIP.  Carl asked ift this process has been good for council this year. Mayor Countryman said that its good. Ilike my binder.  Carl said you will have worksheets starting the next workshop starting July 8 and depending on how that goes we may have to throw one in between. But we won't of course have our tax rate until the beginning of August. The good news is that the preliminary value is up.  Mayor Countryman asked ifs she could have that in English.  Carl said our property value is slightly higher than what it is this year. Ijust got a bill today for  $12,000 ofrefunds SO. Page 120    Mayor Countryman said that is the ebb and flow. Do we know what our collection rate is? Carl said our collection rate this year is right at 98%. It think we have $36,000 to get us to the  maximum.  Palmer asked is that all we got?  4. Executive Session: City Administrator contract  Council adjourned into executive session at 6:28 p.m. Council reconvened into open session at  7:58 p.m. No action was taken from executive session discussion.  ADJOURNMENT  Motion was made by CM Donaldson to adjourn and the motion was seconded by CM Fox with  all Councilmembers voting AYE, motion carried.  Meeting adjourned at 8:00 p.m.  Submitted by:  Date Approved:  James  R  6/25/24  MONT  &-  1837  Page 121