the . The time is 716 p.m. This is the regular meeting of the Emoryville City Council. Madam clerk the roll. Councillor member pry force. Councillor member Solomon. Councillor member Welch. Vice mayor car. Present. Mayor Remo have approval of the final agenda. Members, do we have a motion? Removing approval of the final agenda. Second. We have a motion in a second. Madam Clerk, the roll. Council member Price Force. Aye. Council member Solomon. Aye. Council member Welch. Vice Mayor Carr. Aye. Mayor Moira. Aye. Next we have a special order of the day. This is a proclamation of the City Council of the City of Emeryville for claiming the month of March 2025 as American Red Cross month. Whereas March is American Red Cross month when we recognize the compassion of people in Emoryville and renew our commitment to lend a helping hand to our neighbors in need. And the American Red Cross volunteers have stepped up to deliver relief and care across our country and around the world, bringing out the best of humanity in times of crisis. as Clara Barton, founder of the American Red Cross, did 140 years ago. And the volunteers, blood and platelet donors, supporters shine a beacon of hope in people's darkest hours, delivering shelter, food, and comfort during disasters, providing critical blood donations for hospital patients, supporting service members, veterans and their families, saving lives with first aid, CPR, AED, and other skills, or delivering international aid and reconnecting loved ones separated by global crises. And with 1,638 volunteers in Alameda County, the American Red Cross assisted or responded to 163 disasters, assisting 305 family. the state's state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of and they trained 2,544 youth and adults through Pedro the Penguin and Preparedness programs. And Alameda County residents donated 30,572 units of life-saving blood hosted 1,154 blood drives and trained 13,893 citizens in first aid CPR, AED, Aquatics, and provided 455 case services to military members and their families and provided humanitarian aid internationally. And they did this work to uplift our community and it's made possible by those who selflessly answer the call to help. Whenever and wherever it is needed, we hear by recognize this month of March in honor of their remarkable service. And we ask everyone to join in their commitment to care for one another. Now, therefore, it be that the City of Council of the City of Emoryville, that the month of March 2025 is proclaimed American Red Cross month in the city, and I encourage all residents of Emryville at the month of March 2025 is proclaimed American Red Cross month in the city and I encourage all residents of Emryville to reach out and support its humanitarian mission. As proclaimed by the mayor of the city council of city of Emryville at a regular meeting held Tuesday, March 4th, 2025. Thank you and please come to receive the pro one. Thank you. March 4th, 2025. Thank you. Please come to receive the proclamation. Thank you. Thank you here with you during March when we honor the American Red Cross for its humanitarian commitment to serve communities across the United States and around the world. Thank you for your continued support of the American Red Cross and help can't wait during emergencies American Red Cross volunteers step up to ensure those in need receive relief and care. American Red Cross enjoys a long history of partnering with the city of Emeryville to benefit the community. In 2024, specifically, the American Red Cross responded to nine home fires in Emeryville, providing displaced residents with comfort and hygiene items as well as financial assistance after the disaster. Emeryville volunteers, residents assisted in soundly alarm programs, as you mentioned, events where we installed smoke alarms in homes. The American Red Cross participated in emergency preparedness events and fairs nearby where we met with local residents, talk about disaster preparedness, our program and volunteer opportunities. The market red cross provided a shelter training event at ECCL this August showing Emoryville participants how to work with the red cross in shelter setup and management. In Emoryville there were three blood drives and a total of 72 units of blood were collected added to the rather larger stash of blood that was connected through the county. There are fixed location sites in Oakland, Fremont, and Pleasanton that run every day. These are a few of the examples of activities we have engaged in during the last year. We look forward to partnering with the city in events during the coming year. Our community counts on the American Red Cross for help every day and supporting our community is at the heart of what we do. Working with partners like the City of Henryville helps us to continue our mission to prevent and alleviate human suffering in the face of emergencies by mobilizing the power of volunteers and the generosity of donors. On behalf of volunteers and those we serve we want to thank the city of Emoryville and the city council for standing with the American Red Cross. Thank you very much. And we thank you. Next we have announcements. There's no public comment on proclamations. Next we have announcement of commission and committee vacancies. Mary council, I don't have any announcements tonight. Thank you. Next we have council member special announcements or reports on meeting as attendance. Seeing none, the City Manager's report. No report this evening, thank you, Mayor. Members, any ex-partake communications on the items on the consent or our action items? Seeing and hearing none, now is the time for public comment on the consent agenda and items not on the agenda. Members of the public, please come to the podium. You'll have two minutes. Let's go say something nice about the Red Cross, but apparently I can't do that. There's a farm in Emeryville. It's called Animal farm. Now, it was previously run by a human, but the human was a tyrant. And so the animals took over the farm and they proclaimed, because they were treated badly by the farmer. And the animals proclaimed that all, after they took over and drove the farmer out, it proclaimed that all animals are equal. And then time went on and the pigs moved into the farmer's house and the other animals had to stay out in the barn. The house is much nicer than the barn and so trouble began to arise and the animals in the barn were unhappy because they were being treated worse. And so the pigs made a new pronouncement that all animals are equal except some animals are more equal than others. And that's the story that we have in Emeryville. All city council members are equal except some city council members are more equal than others. Council member Mora, the mayor, he's more equal than council member, Pride Forest. You both committed the same FPPC violation, but exactly the same, but council member, Pride Forest had to pay with a censure and sanction, whereas Councilmember Mayor Murrah did not pay whatsoever. So Councilmember Murrah is more equal than Councilmember pry force. All animals are equal except some animals are more equal than others. And that's the city we live and now there's no taking this back. Unless the four of you censure and sanctioned Mr. Morah for his violations of the. Thank you for your comments. Thank you. Next we have the consent agenda. in to approve consent agenda. Second. We have a motion and a second. Madam clerk the roll. Council member privars. Aye. Council member Solomon. Aye. Council member Welch. Aye. Vice Mayor Carr. Aye. And Mayor Mora. Aye. Motion carries. We have no public hearings. We have one action item. This is the resolution of the City Council of City of Emeryville amending the 2024 2025 general budget and financial policies. Thank you Mayor and members of Council Brian Moira. Excuse me from regional government services. Finance consultant for the city. Tonight we'll go through a brief PowerPoint presentation and then we'll be happy to answer any questions you may have. As is indicated in the staff report, this report was already reviewed by your budget advisory committee and your budget and governance committee. Next slide. So to start out talking about the city's budget, the city has a two year biennial budget process and involves the general fund, the non-general fund and your capital budgets. Right now you're in the middle of a two year cycle for 2023-25. The 2023-24 budget process is complete and the 24-25 process next item is the next item is the next item is the next item is the next item is the next item is the next item is the next item is the next item is the next item is the next item is your annual comprehensive financial report on page 13. The most salient item in this list is the first one, which is the city's budget principles, which were adopted in the 1990s are to ensure that current year's expenditures should be supported with current year revenues. Next slide. There's also fund balance policies and several of your funds. There's the economic uncertainty reserve, fund 275, which is designed to provide for economic downturns and disasters and has a target of 50% of general fund annual expenditures. The disaster reserve fund 277 is designed for funding during a disaster as a target reserve of 5 million and it permits the city manager to access these funds without prior council approval during a disaster. And then finally, we have the general fund, unassigned balance, fund 101. This is the so-called working capital of the city. And this is designed to bridge the gap between expenses paid and revenues during the year. What's noteworthy here is unlike the first two funds, this fund does not have at the present time a fund balance target, next slide. The government finance officers association, the so-called GFOA, has a fund-balance policy for the general fund. It says that governments in general should have such a policy. They recommend that the minimum policy for most agencies be two months of regular general fund revenues or expenses, which roaks out to about 17%. It also has a provision that larger agencies, namely states and major cities, may be eligible to have a lower amount. Next slide. These are comments that in our research, we found over the last five years, repeatedly noting that the city has a structural budget deficit in the general fund. In 2022 during the Measure O campaign, it was said that the city has a structural deficit in that year that actually started two years prior in 2020 and that addressing these deficits at that time included deferring capital projects. In the current budget, this issue was raised yet again, saying that the projected deficits are likely to be addressed using the ending general fund balance, but they are not sustainable in either new revenue or reduced expenditures will be needed next slide. So here's a page out of the city's budget pages nine and 10. There's a couple of significant things to see here. First of all, you'll notice that in this five year projection, the city is projecting a deficit in the general fund for all five years from 2023, 24 through 27, 28. The deficit varies from 2.7 million to 6.4 million. You also see that the general fund on a signed balance, the working capital, drops during this projection from 18% in the positive to negative 16% or negative 9 million dollars in the final year. Conversely, the two economic and disaster reserves remain at or are significantly above the 50% target. Next slide. So here's a look at last year's general fund budget versus the actual. And essentially, the budget was originally adopted by the council with a $5.2 million deficit. It actually ended the year at $7.2 million deficit. The main difference was a $2.1 million settlement with the IRS. Next slide. This year the situation has worsened. Primarily due to a drop in revenue, the revenues came in $5.1 million below the estimate and expenditures went up 800,000. However, it's important to note that the expenditures also include $2 million in salary savings. So if those had not been included, the gap would have been even wider. And then we also highlight on this slide the fact that the city has a Social Security settlement that is pending of $3.3 million, but it is not clear at this time when that settlement may be finalized. Next slide. So here's a detailed look at General Fund revenues in the current year. And you can see here some of the key issues. The first is that in this city, fees and charges are your largest general fund revenue, which is very unusual. In most cities, actually usually the major revenues either sales tax or property tax, but it is not in this case. And that dropped by $4 million. It's also interesting to note that in Emoryville, this line item varies quite significantly from year to year. It can be as low as four to five million dollars as it is this year, but in years of significant development activity, it can be as high as 10 to 13 million dollars, which makes it very difficult for your city staff to accurately develop budgets from year to year. It also suggests that as a practice going forward, one of the recommendations from the Budget Advisory Committee is to perhaps look at budgeting this particular revenue type at a lower level, recognizing the fluctuations. You also had a significant drop in sales tax revenue of 1.3 million. You had a drop in the card room tax of half a million, a drop in the real property transfer tax of 1.6 million. On the other side of the coin, there were some improvements. Namely, the hotel tax was up 300,000. The utility user tax was up 1.3 million, primarily due to increased electrical rates. Franchise revenues were up, and investment revenues were up almost half a million dollars. Next slide. On the general fund expenditure side of things, it's a mixed message here, typically the departments that had vacancies came in under budget and the ones that did not came in at or above budget, most notably in police and fire, next slide. Here's a look at the residual property tax revenue that the city receives. This is money that comes back to the city of Emeryville as the debts of the former redevelopment agency are paid off. At the moment, you get $6.4 million a year of this revenue, although that amount will be increasing in the future because of the refinancing of the redevelopment debt that the council approved last October. In the current scheme, half this money goes to the general fund, the other half doesn't, and as we'll talk about a little later in the report, we're recommending moving all of that money into the general fund in the future. Next slide. These are the recommendations from the Budget and Governance Committee. From October of 2024, they were actually initially discussed in August of 2024. And we discussed these with the Council last November on November 19th. And essentially, as you see, it includes reallocating the residual property tax revenue to the general fund, looking at vacant positions and contract services for savings, reducing departmental budgets, using the economic uncertainty reserved to pay for the Social Security settlement, and using $3 million to help bridge the gap. Next slide. This is the recommended general fund strategy that we're presenting to you tonight. This has been the one that's been vetted by the budget advisory committee and the budget and governance committee. It is similar to what you saw last year with some additional items. So the first four items are essentially the same as what you saw last year. The fourth item is rather than transferring money from the general fund, which as you saw from the earlier slide is heading towards a negative position. We're now recommending that that $5 million come out of the economic uncertainty reserve, which is in a strongly positive position. We're also recommending that you take $2 million from the capital improvement fund, surplus, and also move that to the general fund. So a total of $7 million would be transferred into the general fund. And if you do this, this would allow the general fund on a signed balance to be at a 20% level, which would be actually somewhat above the GFOA standard. The six recommendation is to merge the economic uncertainty reserve and the disaster reserve. There's a couple things going on here. First is those two reserves overlap. They both address disasters. And it's also the case and emerging them, we think, would increase your flexibility in the future. But also it would clarify your 50% reserve target. Because if you look at the budget and you look at your audit, what you see is these two reserves are calculated differently for purposes of the 50% target. Sometimes it refers to the economic uncertainty fund only, and other times it refers to the uncertainty fund and the disaster fund had it together. So we think if you merge these funds, in addition to increasing flexibility, you also clarify this, what does the 50% mean? The seventh item is as we alluded to earlier, amending the unassigned general fund balance, fund 101, so that now has a target every year. And the target we would recommend is 20% of your annual expenditures somewhat above the GFOA target. And I think related to that, one of the things I would observe is that going forward, it is important when you look at general fund targets to not only focus on your reserves as you have in the past but also to focus on the general fund itself. So you have two targets, not one. And then finally, we have a new recommendation from the budget and the governance committee from last week. And they recommend that you assign $3.3 million from the economic uncertainty reserve for the Social Security settlement. As I understand, the recommendation from that committee, they wanted to take it a step further than what we were recommending and saying, that money from that they said let's go ahead and assign it right now put a fence around it so that that money is there when the settlement occurs. Next slide. So here are some of the results of the recommended strategy. What it does first of all by allocating all of the residual property tax money to the general fund is it reduces your deficit this year from $8.7 to $5.5 million. It covers 35% of the deficit and most importantly with ongoing funds, not one-time money. It increases, secondarily, increases the general fund, an allocated fund balance from 10 million to 11.5 million, which brings it up to that 20% target figure. Third, it increases the economic uncertainty reserve by combining it with the disaster reserve, so it's now at approximately 30 million dollars. It decreases the unassigned balance in the capital fund from 20 to 18 million. It decreases the newly combined economic reserve down to 25 million or instead of being at the 56 percent number, it would be at 47 percent still close to the target. It establishes the 20 percent target for the unassigned general fund balance and it also, as we noted earlier, assigns the money from the economic uncertainty reserve for the Social Security settlement. Next slide. So this is a quick look at what the budget numbers would look like this year in 2024, 25 if you made all of these changes. And you can see that what happens is that the general fund balance is now at 21%, just over the target. Instead of having a budget deficit, you'd have a surplus of about $1.5 million. You'd be transferring in $7 million into this fund. And the economic uncertainty fund would be at 46%. We did not carry through this model to the last three years because that's work that's now underway in the new budget. However, it occurs to us looking at this that as we update the expenses and the revenues that it to stay at that 21% target, it is likely that you will have to do transfers in into the general fund for the next couple of years to stay at the target. Next slide. So additional budget strategies that the finance department is working on. We have ongoing analysis and audits in the areas of sales tax and utility tax with avenue and that generates additional money for the city during the year. Similarly, we have ongoing business license tax analysis and audits through the HDL company, which also brings in additional revenue during the year. We're having discussions with HDL corn and cone about doing property tax and property transfer tax analysis and audits both because these are major revenues for the city and because we think that there's a need for increased reporting and review of these audits. Excuse me. Another area that we have talked about and an area that was recommended by your budget advisory committee is to look at a cost allocation plan and master fee study. This has not been done in Emoryville in several years. And because this is your number one revenue source, it seems to us that it is time to do that. It would update the fees and perhaps more importantly, it would also allow the general fund to recover costs to supporting the city's other 40 funds. And then there's also been some exploration of grant assistance to have department, receive grant assistance to help them with grant applications for one time projects. Next slide. We wanted to talk a little bit about revenue measures in general and also revenue measures in Alameda County. There's a quote here from Michael Coleman who's the fiscal advisor for the League of California cities or CalCities is their now known. What's interesting here is last last November they had the largest number of local tax measures proposed and passed in California history with over 76% passing. Perhaps more significantly for this discussion. Seven of the 14 cities in Alameda County had revenue measures on the last ballot. 15 were proposed, 11 were passed and and they ranged anywhere from 390,000 a year to over 47 million in Oakland for police services. Next slide. This is a detailed list of all the revenue measures. In last November, it shows you the amount from the highest to the lowest. It shows the vote for each one, whether they passed or failed. Also worth noting in this slide is that three of the revenue measures in Berkeley were actually put on the ballot by residents. And that's where you'd see the eye. Those are initiative measures. Next slide. So we also wanted to give you an update on potential revenue measures. As you know, this has been a discussion that the Budget and Governance Committee had last year at both of their meetings in August and October, and we talked to you about them in November again. Basically, your next opportunity for revenue measures would be in November of 2026, and the revenue would be available to you in 2027. The cost to put a measure on the ballot, including polling, outreach, and all of that would be around $150,000. You see the list of potential revenue measures that were discussed last year by the Budget and Governance Committee. We've also added at the bottom the vacant parcel tax, which was raised by one of the council members on November 19. As you can see, the amount of revenue generated by these different measures varies, in some cases like the parcel tax, it's a three and a half million dollars a year, a quarter cent sales tax or transaction tax, be two million dollars hotel tax, 900,000. Then we have a couple that we don't yet have estimates for. We are working with companies that do this sort of analysis and estimates and depending on the level of interest of the council will continue to pursue that. I'm going to assume that, unless I hear otherwise tonight, that the list that we presented to you last year and the one we have tonight is the one that you're still interested in. And then as far as the process, what we would envision is updating the five-year model as part of the upcoming budget, having a council study session in the fall of this year to talk about these different items. It is typically the case that you only research your poll two or three items at a time, and so since you have six possibilities, we'd have to prune the list a little bit, I suspect. And then the time between the fall and the spring or summer of next year would be for research, outreach, and then the council deciding whether or not to put one or more of these measures on the ballot. Next slide. Here's the action from the Budget Advisory Committee. They supported the recommendations in the report. They wanted to make sure that the change in the residual property tax be shown as the first item they felt that was the most important. They expressed concern about balancing the budget with vacant positions as it's happened over the last five years in this community. They also had what a series of what they called longer term recommendations, namely a more conservative approach to revenue estimates. They also felt it was important to receive revenues into the general fund rather than using a fixed amount, or allocating a fixed amount to other funds. They had a proposal that given the city's ongoing general fund shortfalls that perhaps the city council might want to consider a practice of doing budget transfers at mid-year rather than when the budget was initially adopted to make sure that the budget was in balance before a transfer was made. Interesting concept. They felt strongly about updating the cost allocation plan in the fee study and they also wanted to have more detailed information on sales tax revenue provided to the council and the public and you'll notice an attachment six that we we did provide that to you tonight. Next slide. Budget and governance committee met last week. They recommended the first seven strategies in the report that you saw earlier and as I noted before they added the eighth strategy about assigning the $3.3 million in the uneas certainty reserve rather than just indicating that that was a recommendation. They also felt similar to the Budget Advisory Committee that once the General Fund is in balance, it would be a good idea to try to move away from the practice of balancing the budget with vacant positions. They asked for more detail on revenue options. They felt that when it came to the vacant home tax that they felt that perhaps should be given a lower priority than some of the other revenue options. There are a couple of reasons there. One was that those tax proceeds usually are not put in the general fund. They're usually put in a fund related to the tax. So if it's a vacant commercial building, usually you'd put that in economic development fund. If it's a vacant home tax, you might put it in a housing fund. And so the thought there was, it's an interesting concept, but maybe, since it's not necessarily related to the general fund, it might get a lower priority. But again, it's up to the council on how you wish to proceed on that. And then there was also a request for some benchmark information on the fund balance policies of local cities. Next slide. So here's a quick comparison we put together in the last couple days about local cities. You'll notice the first five cities or cities that are similar in size to Emoryville anywhere from Piedmont at 10,000 population and Emoryville, 12,000 population to Elcerito at 25,000 population. And we also put in Richmond and Berkeley. It wasn't a request for that even though those cities are significantly larger than Emoryville. There's a couple things worth noting here. First of all, you'll notice that Emoryville at the moment is the only city on this list that does not have a general fund on a signed balance policy. Everybody else has wanted somewhere between 10 to 25% and as you know, that's one of our recommendations. Second, you'll see that when it Two to the reserve policy, three cities are between 20 to 30%. Two cities do not have a policy at all and then two are at 50% Penole and Emoryville. Although Penole's actual reserve is out only at 29% they assure primarily because they also have an $8 million budget gap prior to their passage of a half cent sales tax. So with the passage of the sales tax in Penole presumably that their deficit will be lower but not completely addressed. And then you see Emery Village unique in having a reserve balance of north of 50%. So again an interesting benchmark comparison. Next slide. So next steps in this process, we're presenting this report to you tonight with for consideration and action. We recommend the eight items that you saw in the earlier slide. Second, we are proposing to come back to you on the 18th with detailed mid-year adjustments for all funds, not just the general fund. And then we will continue working on the two-year budget and the updated five-year projection between now and May and June. Next slide. So with that, be happy to answer any questions. Members, any questions on about the presentation or the eight recommended actions? Maybe we could get those eight up on the screen. It might be helpful to reference. Okay. There were next one. There we are. Any questions, members? Member, pry force. Thank you. Ever since you've been a part of the Emory Vale family, I felt that your level of transparency and truth telling about where we're at and where we can be. The consolidation of the economic uncertainty reserved in the disaster reserve, what are to be clear, would the target still be 50% if we are making, if we're doing this comprehensive strategy or are we adjusting the target? Or can we adjust the target? Well, a couple things. The target's up to the council. You can certainly adjust it at any time. We didn't change the 50% target, but I think frankly as we're walking through this, it was very confusing to me at least and perhaps others on the staff what exactly it meant. Because if you looked at the audit, it said you add the two together. If you looked at the budget, the first page said they're separate and the second page said you audit together. So I said, okay, we got three different theories of the case here. So we can certainly keep the 50% but presumably we could add them together. The other reason behind adding them together is I noticed that... the other policy that we have to do is to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that we have to make sure that policy that the city has of allowing the city manager to spend up to the do with the city and the city. And the one unique piece in the disaster policy was this policy that the city has of allowing the city manager to spend up to the full $5 million in that fund. Prior to going to the council. I think the logic to that seems to be if you're having a disaster you don't want to wait till the next council. You want to see manager to spend it so we will We also felt that if you put them together and let's say in the future you didn't have an economic downturn but you did have a disaster, you might want to... vision in the newly merged fund. But we also felt that if you put them together and let's say in the future you didn't have an economic downturn but you did have a disaster, you might want to have the full $30 million behind you for that disaster and not just the 5 million. So it seemed to us a little artificial to separate them the way they were separated. But that's the logic behind the recommendations. Number pry force. And my understanding is that the target that we have of the 50% is a bit higher than cities comparably, even the city's our size. That's correct. As you saw from the earlier side, the only one we could find. In my experience, I've worked with one or two other cities that have a target that high, but for the most part, most cities are in the 20 to 30% range. I think it's fair to say that other cities, if they heard you guys had a 50% or so, there'd be quite jealous because they clearly don't. And you also saw in that earlier slide, by the way, there's a couple cities that don't have a reserve policy at all. policy at all that what they do is they depend on that unassigned general fund balance to be both their reserve and their working capital, which again, depending on your point of view to me that's cutting it maybe a little too close to the edge, but again, that is the practice in some cities. So I think the fact that you have 50% in reserves and now we're proposing another 20% on the general fund, that's like a total of 70%. That's a lot of resources. Although I think in realistic terms, in the next couple of years, until we get the general fund back in balance, it is likely that both the capital fund and the economic uncertainties are going to have to contribute more to the general fund. and then really the strategy for the departments and the city manager and ultimately the council is going to be how do you bridge that gap? Do you reduce your expenses? Do you raise revenues? Do you do some combination there of? It's it's a pretty high hurdle certainly, but again, it's something to focus on. And I think it's, you know, the other thing is, it's unfortunate that this has been brought up year after year after year, and it hasn't really been addressed. I was a little surprised to see that all the way back to 2020, you had annual budget messages saying, this is a problem, you can't go on. There's a problem, I can't go on. Okay, at what point are you going to tackle it? And I think given the fact that we're so far over the numbers this year in terms of being overexpended and revenues dropping, that this shows you what happens in a situation like that where you're getting these warnings. But in the past years, what has happened is because of vacancies and because of revenues coming and overexpaces coming in under, you've been able to sort of balance along the way. And this year, because the problem was so big, you weren't able to get there this time. And that's kind of what happens in one of these structural gaps if you continue to kind of kick the can down the road if you want to use that analogy. So I think that's kind of where you are. And so it's a good time, I think, ahead of the budget to say, let's talk about how we can balance this year's budget. Even though one third of the money, a little bit more is ongoing and two thirds is not, it's a starting point. And then we can talk about down the road, how you're going to tackle this in future years. Number of price force. So if we were to reduce it to maybe about 40%, we would still be above most cities. It would still be a good sweet spot. But it would allow us to, yeah, because I'm thinking about that negative 9% that even with the adjustments, outside of the recommendations, hopefully we do get there, but I'm still thinking about how do we prevent this from happening that? Yeah, I mean, I think a couple of things. One is that it is likely that in the next two years, we're gonna come back to you, or the finance folks going to come back to you and tap into that fund some more and tap into the capital some more to keep things afloat until you can get to the next revenue measure election. And I think that if there are not significant reductions in this budget, your other approach is in fact to do one or more of the revenue measures. Now I think it's worth noting if you think about one of the earlier slides, if you move the residual property tax, that cuts your deficit totally five and a half million. And as you saw from the earlier slide, if you took the sales tax and the parcel tax, that is in fact five and a half million. So there are ways to get to the finish line. Although, you know, the expenses continue to increase and yet most of your revenues at least at the moment are not. Although the combination of doing the audits, looking at the cost allocation plan and looking at other opportunities are always we're trying to kind of nibble at this, you know, kind of take a piece off the rock every so often and try to bring you closer and closer to where you need to be. That's kind of the game plan. Any other questions? I'd like to open public comment on this item. Members of the public, you'll have two minutes. Okay. I'd like to tell the city manager to please fix this light here to the city manager. It's been flickering for a couple months now. This light. So the elephant in the room here, of course, as I've reported on in the Emoryville Tatler is the but the business tax. Emoryville's business tax is 0.1% of gross receipts, the lowest in the Bay Area by far. Okay, we're leaving millions of dollars on the table because our business tax is so low. We need that, we need those millions, as Mr. Murrah just let us know. But then of course on top of that is the business tax cap, which is a gift to the biggest businesses in Emeryville, who after a certain amount of money pays zero taxes on their gross receipts. I have a small business in Emeryville. I've had it for 35 years. And every penny I make, I have to pay taxes on in Armoryville. But picks are, for instance, and other big businesses, well, they don't have to pay money on every penny they make because of this business cap. So it's completely regressive taxation. You know, it's, it's, it's like a Paul Ryan wet dream. It's the ultimate regressive taxation. I mean, most Republicans would be too ashamed to install the business tax that we have at Emeryville because it's too regressive. So we're leaving millions of dollars on the table and we need the money. So I suggest we have a flat tax make every business pay the same rate. The small businesses should pay the same rate as the big businesses, instead of as it is right now, which is the big businesses pay a much lower rate. And it's just completely unfair and ridiculous. And it's a leftover from previous city council members. But the three of you have let this slide into your shame and you cut me off for two minutes. Thank you for your comment. Okay members I'll open this for a member deliberation or if you'd like to make a motion. So, I remember, Pry Force. So, there's a, I remember as a kid, there was this like, looney tunes cartoon of this mama buzzard. And I think that the character is called beak buzzard. And it was just like this overgrown bird who didn't want to leave the nest and and he was so funny he was like no mama no mama when we were only you know and and so and the mother's like trying to put some bird out out and so I I applaud the and my council colleagues and finally addressing the I applaud the Mr. Mora and my council colleagues and finally addressing this issue when I came aboard a city council member. I remember the early debriefs that I had and I looked at the numbers and I kept saying there's something wrong here and I remember even being corrected. That, oh, we're fine, everything's fine. There are council meetings. I mean, there's this video evidence of me being corrected probably more than one occasion that everything is fine. No, no, no, no, no, no, no, no, no, you know, I think that us finally dealing with this, addressing it. And I think that the dealing with this and addressing this is not just, hear these solutions. And I do respect these strategies. But I think that in this discussion around the business tax cap, that we are at least having discussions about it. that we're at least studying and at least looking at this. Rather than, oh, well, you know, council members who've done this before and we did this before, we did this before and I felt that we were sort of caught in a twilight zone of denial as relates to our budgeting process. And so I highly recommend that we take on the strategy. It's actually honestly a little bit too conservative, physically conservative for me, but I'm willing to bend to support that we make these recommendations. I do would like to see us maybe get to that 40% target rather than having it so high. Just from a business standpoint, that we need money to make money. And I think that, I also respect the budget committees recommendation that we just don't do this like musical chairs when it comes to staffing in order to meet some of our budgetary woals. And so that is, yeah, so I just recommend that we move forward with this. And I'm just glad that we're reaching a point of maturity where we're ready to like now leave the nest. Member Price Forces, that emotion for the recommended strategy that we have up. No, but I will second the motion. Members, do we have a motion or other comments? We have a motion. Do we have a second? I second. Madam clerk, the roll. Councilmember Prifors. Aye. Council member Solomon. Aye. Council member Welch. Aye. Vice Mayor Carr. Aye. And Mayor Mora. Aye. Motion carries. Next we have department head reports. We have any updates. Thank you. Mayor yes. This is my report on planning commission actions at their February 27th meeting five of six members of the commission were present with Commissioner Chaff absent one vacancy, which you filled just this evening. The commission reviewed the 2024 general plan annual progress report, including the housing element annual progress report and the housing successor report and recommended the City Council approve those reports for submittal to the state. This will be on the city council's March 18th agenda. The commission also discussed committee composition how to enhance community representation on the planning commission as part of the implementation of housing element program EE in this discussion is also being paralleled with all of the community advisory committees will be summarized and presented to the council at a later date. This concludes my report. Happy to answer any questions you may have. Any questions, members? Next we have the number pry force. I just want to say that I'm glad that this sort of diversification inclusion in our committees was already present in the housing element. And so that was something I did not know and then when I was made aware. And so and that was before I think I came aboard. And so Kudos to those who made sure that that was there. Thank you. Next we have future agenda item requests, members with anybody like to propose a future agenda item. Member Priforce. So, this was a little outside of my purview, but we recently had an issue where I believe there were emeryville residents and I could be corrected who were involved in insulting pets, animals. And yeah, and so it was pretty bad on social media and yeah, and I believe it was confirmed that they were a residential residence. I don't know if this incident happened in Emoryville. Oh, Pedro, do you know anything about it? I recall the news incident happened in Pittsburgh, but the arrests happened in Oakland. Okay, but the residents themselves, where they, where they are in real residents. Yeah, chief over there. Oh, yeah, sorry. That way or what? Well, Oakland residents. Okay, good, okay. So my correction, there were Oakland residents. And so hopefully that will be corrected online as well But the interesting thing it became a conversation That everywhere I walked and people like stopped me and they were asking me about it Which is which is why I think I probably reached out to you know like trying to figure out like okay Well, so what's what's going on here? so A couple of things came up around I I'm sorry, it's a future agenda item, so I'm not gonna take too long, but a couple of things came up around our pet policies and whether or not we're doing enough to protect our pets, particularly when it comes to how many pets how many pets we have in Emoryville that the for some people it exploded during the pandemic and that's not like just isolated to Emoryville is probably all over the country, all over the world and that a lot of pets are not registered. And thus, they are a danger to those who do have pets. And so people have come to me. And you all may have, people have come to you about a pet attacking other pets. And then during their investigation, you found out that the pet was not was not was illegal. And so I'd like for us to take a look at that. If there I'm sure that our pet policies are probably county based but there is something that we can do to to better enforce whether it's increasing the fees, adding some fees as it relates to pets being unregistered when it comes to residents in Emoryville. So just taking a look at our pet policies. So that's my future agenda item submission. Sorry, it takes a long. Members, by a show of hands, is there support for the agenda item of looking at unregistered pets? Member, private voice would be, would you be agreeable for that going before the budget and government and its committee? Yeah, the discussion is about fees, yeah. Yeah, thank you. Madam Vice Mayor, I'm sorry. I was going to suggest that this may be in the the the the the the the the the the the, then I'll place on the agenda. A place on the agenda. The pledge of allegiance. As we can see that our democracy is becoming increasingly fragile and it's really important that, just as we see it with our neighboring cities, with our county that a Pledge of Allegiance is exercised in their proceedings. I ask that we review the Pledge of Allegiance being returning to our council chambers, and I will demonstrate. Our Pledge of Allegiance to the flag of these United States of America. I'm to the Republic for which it stands, one nation, indivisible liberty and justice for all. By a show of hands as their support for adding the Pledge of Allegiance as a future agenda item. The motion fails. The time is 927. This meeting is adjourned.