City Council Jun 25, 2024

Jun 25

City Council Meeting Summary

Time	Item	Item Summary	Motion Summary	Comment Summary
00:01:29	None: None	The City Clerk, Babette McDougall, announced that the City Council meeting of June 25, 2024, is being broadcast live on cable TV channel 27, Zoom, and the city's website (00:01:29). The Mayor then called the meeting to order and began with the Pledge of Allegiance (00:01:43).	No Motion	0 Total: 0 In Favor 0 Against 0 Neutral

00:01:53	1: CALL TO ORDER - 6:00 PM	The meeting is called to order. The clerk leads the Pledge of Allegiance. The City Clerk notes that there is one main business item, but clarifies there are several items related to the budget (00:02:11). He states that there is no consent calendar.	No Motion	0 Total: 0 In Favor 0 Against 0 Neutral

00:02:20	2.A: City Council Review and Recommended Adoption of a 25% Reserve Level for General Fund Contingencies by Adding an Additional 10% Contribution in the Economic Shortfall Fund to the Current Policy Amounts of 5% For Budget Stabilization and 10% for Economi	The City Council reviewed and discussed the proposed adoption of a 25% reserve level for general fund contingencies. The City Manager presented the history of reserve policies in Sausalito, noting that a 15% policy (5% for budget stabilization and 10% for emergency shortfalls) has been in place since 2011 (00:04:22). He also mentioned a past practice of unofficially maintaining a 25% reserve. The City Manager recommended formalizing the additional 10%, bringing the total to 25% (00:08:01). He provided a survey of reserve policies in other Marin County cities and cities of similar size in nearby counties. Councilmembers Kelman, Hoffman, and Blustein raised questions about the adequacy of the reserve level in light of current economic conditions, increased insurance costs, and infrastructure needs. Councilmember Kelman questioned the macroeconomic climate compared to 2011 and its impact on the reserve policy (00:09:40). Councilmember Hoffman suggested that the reserve level be reconsidered after discussing insurance coverage (00:18:02). Councilmember Blustein inquired about the anticipated decrease in insurance premiums due to recent measures (00:29:03). The City Manager clarified the difference between reserves and unassigned fund balance, stating that excess funds should be invested in projects (00:15:42). He and the City Attorney discussed the potential for insurance costs to decrease in the future given the risk mitigation measures the city is taking (00:25:52). The City Council agreed to move to a vote on the resolution.	Motion to increase the overall general fund reserve policy from 15 to 25% by requiring an additional 10% in the economic shortfall fund with annual review during budgeted adoption effective July 1st, 2024 (00:51:38). Motion Carries 4-1.	2 Total: 1 In Favor 0 Against 1 Neutral
00:47:45 Miss McDougal was Neutral: Inquired about the 2024 budget, the economic loss due to the Sausalito Center for the Arts' lease situation, and the PBIT (Public, Benefit, Investment, Trust) initiative. 00:49:25 Unknown was In Favor: Expressed support for increasing the reserve to 25%, noting that it would still leave a significant amount of unassigned fund balance. Emphasized that a reserve policy sets a threshold that requires special council action to dip into (00:50:14).
01:01:05	2.B: Adoption of Fiscal Year 2024-2025 Budget and Allocated and Funded Positions	Director Hess presents the Fiscal Year 2024-2025 budget for the City of Sausalito. The general fund budget includes $17,241,800 in outside revenues and $20,709,566 in expenditures. The budget will balance using $1,017,684 of unassigned fund balance in excess of reserves. The general fund contains $3,134,000 of reserves under the 15% policy, and $7,747,600 in fund balance in excess of reserves. With the increase in fund balance policy to 25%, this leaves a restated balance of $5,227,338 of reserves. The general fund is projected to end fiscal year 24 in the black by over a half a million dollars. Insurance challenges are a significant change over the prior year. Joining PRISM helped limit the projected deficit. Premiums paid to PRISM are roughly $170,000 over those paid to Bay Cities. The SIR is increasing tenfold to a half a million dollars. $750,000 is budgeted for the general liability SIR and $250,000 for workers' compensation to settle future claims. A risk manager position is funded under the finance department. The city is exploring other trust providers to manage pension and OPEB resources and will continue to work with CalPERS and review the study by Barthels and Associates to manage the $35 million pension obligation. Capital projects will continue as planned, funded by external resources like Measure L sales tax revenue and gas tax. (01:03:01) Insurance challenges are a significant change over the prior year. Councilmember Kelman inquires about understaffing in the Community Development Department based on a SWOT analysis. Director Phipps responds that a Senior Planner position was filled internally, creating an Associate Planner vacancy that is being recruited for, and consultant support is being used to handle the burden of new state housing policies. (01:10:29) Phipps notes that as projects like the housing element conclude, there may be opportunities to shift consultant expenses into staffing expenses. Kelman asks about the pension UAL payments. Hess explains that discretionary payments and realigning layers within the UAL are options, with the goal of managing the $35 million pension obligation. (01:13:58) Councilmember Blustein asks about the budget structure and staffing. Director Hess says this year's budget does not include top step for every employee, but budgets where employees are at today, plus the next step they are eligible for, and the COLA. Kathy Nikitas states that of 79 full-time positions, 67 are filled, and 17 of those are at top step. Nikitas says it typically takes seven years to reach full step, depending on the grade. (01:20:33) Hess confirms the budget assumes full staffing, with intentions to fill every available position. Councilmember Hoffman raises concerns about the budget methodology for employees and says that if you use a consistent methodology, the increased cost is a million dollars. (01:26:19) Hess says the goal is to give a more realistic and accurate budget instead of overinflating expenses. The council discusses and debates the budget methodology.	Motion to adopt a resolution to adopt the fiscal year 2024-2025 city manager's budget and allocated and funded labor positions as required to meet state of California legal requirements (01:47:09)	4 Total: 1 In Favor 0 Against 3 Neutral
01:38:25 Babette McDougall was Neutral: Babette McDougall thanks the council for the vigorous discussion and emphasizes the need for full transparency. She asks about the status of negotiating the real property portfolio from the current budget year. She says that if the director of finance says we need to tighten the screws up a little, she believes him. She wants clear, open, and subtle common ground to be clear as possible. 01:40:43 Unknown was In Favor: The speaker says the council should pass this budget. Between 2012 and 2020, salaries were budgeted as Chad is budgeting for this budget. It's important to recognize that our staff is overworked and understaffed, and that you need to act accordingly. 01:43:12 Gregory Taylor was Neutral: Gregory Taylor shares a "history lesson" and recalls Amy Belser's sayings: "the devil's in the details" and "we don't want to throw the baby out with the bath water." He says Sausalito did when they exterminated all the anchor outs. Joe Cryans made over half a million dollars a year while Stacey Gregory is only making $210,600 a year. The speaker says the council should give everybody a raise because when everyone's running away from whatever bad things happen, it's the cops that are running towards it. 01:45:22 Sandra Bushmaker was Neutral: Sandra Bushmaker notes that Amy Belser and she overlapped on the council and used the expression "the devil's in the details". She sees a 161% increase in insurance premiums plus out-of-pocket expenses for insurance, self-insured workers' comp, and defense legal fees on top of that. The speaker would like to know what the number is and compare it to various years in a chart, because these are considerable increases in costs and she's concerned about them.
02:02:31	2.C: Adopt a Resolution for the GANN Limit for Fiscal Year 2025	Councilmember Hoffman suggests having a policy discussion and giving direction to staff regarding risk factors, building on Councilmember Raquelman's discussion. (02:02:32) She believes it would be helpful to guide the council forward on finance and policy issues. (02:03:03) The City Clerk asks if there is a proposal for direction from Councilmember Hoffman or Kelman under the adoption of the budget. (02:03:07)	No Motion	0 Total: 0 In Favor 0 Against 0 Neutral

02:03:17	2.B: Adoption of Fiscal Year 2024-2025 Budget and Allocated and Funded Positions	The council discussed prioritizing risk factors with insurance coverage, focusing on sidewalks and geologic hazards to mitigate risks and reduce insurance costs. Councilmember Hoffman suggested a policy matter of prioritizing reducing risk factors with insurance coverage, including sidewalks and geologic hazards. These geologic hazards are related to subsidence and hillside issues, referencing past landslides (02:04:52). The council discussed infrastructure, pension UAL payments and sales tax revenue (02:05:24). It was suggested that a separate City Council meeting is needed to comprehensively discuss and prioritize these issues (02:06:37).	No Motion	0 Total: 0 In Favor 0 Against 0 Neutral

02:07:26	2.C: Adopt a Resolution for the GANN Limit for Fiscal Year 2025	Director Hess presented the requirement to adopt a resolution for the Gann Limit for Fiscal Year 2025. The Gann Limit is a state requirement based on changes in population and the CPI (02:07:44). It determines the amount of tax revenues the city is allowed to spend in a fiscal year (02:08:41). For 2025, the City of Sausalito is $4.7 million below the Gann Limit (02:09:08). The city went back and recalculated the GAN limit for a number of years using the county population to increase capacity if needed (02:09:22).	Motion to adopt a resolution which selects per capita personal income and city population as the factors to be used in calculating the fiscal year 2025 appropriations limit and to adopt the attached resolution (02:10:12). Seconded by Councilmember Kelman (02:10:35).	1 Total: 0 In Favor 0 Against 1 Neutral
02:10:05 Babette McDougall was Neutral: Passed on making a public comment.
02:11:08	2.D: Adopt a Resolution Approving the Investment Policy for Fiscal Year 2025	The council is required to adopt an investment policy annually. Director Hess presented the resolution to adopt the investment policy for fiscal year 24-25, stating that there are no changes from the previously approved policy. A councilmember inquired about considering California CLASS as an alternative to LEIF to diversify investments, (02:11:53) noting its potential for equal or better performance. Director Hess responded that while it isn't currently in the investment policy, she is willing to update the policy to include it as an acceptable investment, pending compliance with state regulations. (02:12:26) She requested that the current policy be adopted for the evening, with a new investment policy to be brought back as a consent item at a later meeting. (02:12:58) Councilmember Kelman supported further consideration of California CLASS, noting its flexibility. (02:13:25) Hess clarified that the city is currently invested in treasuries, and the returns from LEIF or CLASS would likely be similar to the current treasury bills, which are around 5%. (02:14:06) Hess actively manages the cash in the primary checking account to meet the city's cash flow needs and invests the remainder in T-bills, but is open to considering LEIF or CLASS for additional yield, prioritizing safety. (02:14:34) The City Manager stated that state law restricts the types of investments permitted for municipal governments to prevent speculative investments. (02:15:01) Councilmember Kelman requested that the finance committee review the investment statements regularly. (02:15:33) The City Clerk inquired about the T-bill ladder and its duration, and Hess confirmed that there are maturities every month, with a trade to be placed on Thursday that will extend to July 2025. (02:15:57) The City Clerk discussed the policy choice of locking in over-term yields with longer-term bonds, acknowledging the potential for loss if the funds are needed before maturity. (02:16:12) Hess acknowledged the interest rate risk, and the City Clerk suggested a discussion with banking partners to determine the best practice for balancing longer-term and shorter-term bonds. (02:16:35) Hess agreed, expressing comfort with a one-year mark but openness to potentially two or three-year maturities for a portion of the portfolio, given the city's significant unspent resources. (02:17:09) Hess suggested that the finance committee would be a good venue for these discussions. (02:17:33) The City Clerk raised the issue of the 115 trust, noting its underperformance compared to funds in excess of reserves due to low interest rates, and asked Hess to investigate alternatives, potentially including building a bond ladder inside the 115 trust. (02:17:49) Hess stated that there are a limited number of companies that can administer Section 115 trusts in California, including PARS and CalPERS, and that she is starting conversations with CalPERS, but they may only offer select balanced models. (02:19:08) The City Clerk asked Hess to investigate these options, and Hess agreed. (02:19:55) The City Clerk then inquired whether investing cash into the CalPERS fund yields 6.8% on an apples-to-apples basis. (02:20:03) Hess clarified that the CalPERS Section 115 trust is not a guaranteed 6.8%; it's market-driven. (02:20:21) She explained that making a discretionary payment to pay down the UAL would effectively realize a 6.8% return, as that is the interest rate being charged on the outstanding debt. (02:20:31)	Motion to adopt the resolution of the City Council of the City of Sausalito, annual approval of the investment policy. (02:22:49)	1 Total: 0 In Favor 0 Against 1 Neutral
02:21:17 Miss McDougal was Neutral: Miss McDougal discussed a policy for people investments going forward and risk management. She inquired about the implications of transitioning to charter city status and how it will affect future decisions on allocating or reallocating investments. She called for an open, democratic exchange to focus on how citizens' concerns can be reflected in policy questions.
02:23:59	2.E: Adopt a Resolution of the City Council of the City of Sausalito to Join Public Risk Innovation, Solutions, and Management (PRISM); Authorize City Manager to Approve All Program Documents Related to GL-1, Excess Workers’ Compensation, and Property Pr	City Attorney Sergio introduced the item, explaining that the resolution authorizes the city to join PRISM, a joint powers authority for pooled self-insurance programs. The resolution also allows the City Manager to execute program documents for general liability, excess workers' compensation, and property coverages provided by PRISM. He stated that PRISM offers the most cost-effective insurance options, with significantly lower premiums compared to the private market (02:25:40). An alternative option with the state compensation insurance fund was discussed, but PRISM was still the better option. Councilmember Hoffman inquired about the city's total self-insured retention (SIR) obligation, estimating it at $875,000 annually (02:27:18). Sergio clarified the SIR amounts for property ($25,000), general liability ($500,000), and workers' compensation ($350,000) per claim. Councilmember Kelman raised concerns about the work plan to achieve lower premiums with PRISM, and how it is baked into the budget (02:31:19). Sergio explained that PRISM requires a claims audit in the first year and the city is evaluating third-party administrators for claims processing (02:31:48). The City Manager added that the Miller Pacific study, sewer enterprise consolidation, and increased infrastructure funding are part of the risk mitigation efforts. Councilmember Kelman questioned if the fiscal impact should include the hiring of a full-time risk manager. Discussion ensued regarding the ongoing efforts to hire a risk manager, including engaging a temporary risk manager through PRISM contacts. The Vice Mayor stated the work plan was in motion.	Motion to adopt the resolution to join PRISM, authorize the City Manager to approve program documents, clarify the city is joining the PRISM workers' comp plan, and continue exploring parametric insurance and implementing the city manager's work plan to PRISM (02:40:16). An additional direction was added to get budget estimates associated with the work plan for the mid-year budget review (02:41:11). The motion carried unanimously (02:23:47).	0 Total: 0 In Favor 0 Against 0 Neutral

02:44:20	2.F: Adopt Resolution Authorizing Application to the Director of Industrial Relations, State of California for a Certificate of Consent to Self-Insure Workers’ Compensation Liabilities	The City Attorney, Sergio, presented the item, explaining it is necessary for the city to apply for a certificate of consent to self-insure workers' compensation liabilities from the Director of Industrial Relations, due to the city joining PRISM's Excess Workers Compensation Program (02:44:39). Because the program is an excess program, the city is self-managing and self-insuring claims under the $350,000 SIR (02:44:50). Councilmember Kelman seconded the motion (02:48:16) and noted the suggestion to schedule another meeting to discuss risk management spend and strategies (02:48:17).	Motion to adopt a resolution authorizing application to the director of industrial relations state of California for a certificate of consent to self ensure workers compensation liabilities in conjunction with the motion to join PRISM (02:47:54). Seconded by Councilmember Kelman (02:48:16).	1 Total: 0 In Favor 0 Against 1 Neutral
02:45:48 Babette McDougall was Neutral: Ms. McDougall stated that the city is facing risk exposure and the workers' compensation situation is arising because the city took its eye off risk management (02:46:16). The city was dropped from an insurance pool they helped start, which is a serious issue (02:46:23). She urged the council to think carefully about the financial exposure to the citizens and the city (02:47:13), and recommends going with the actions presented by the City Manager (02:47:29).
02:48:48	3: ADJOURNMENT	The meeting is adjourned. The next regular meeting is scheduled for July 16th at approximately 7 PM. The City Clerk wishes everyone a happy Fourth of July.	No Motion	0 Total: 0 In Favor 0 Against 0 Neutral

City Council Meeting Transcript

Adrian Brinton

City Council Jul 16, 2024

Time	Speaker	Text
00:01:29.06	Babette McDougall	Council members, the meeting, the city council meeting of June 25, 2024 is being broadcast live on cable TV channel 27. It's also live on zoom and is live on the city's website. Mayor.
00:01:43.68	Mr. City Clerk	Thank you, Mr. City Clerk. We will call this meeting to order and we'll begin with the Pledge of Allegiance.
00:01:53.14	Mr. City Clerk	All right.
00:01:53.41	Unknown	Thank you.
00:01:55.89	Unknown	Thank you.
00:01:57.30	Mr. City Clerk	Thank you.
00:01:57.33	Unknown	Thank you.
00:01:57.53	Mr. City Clerk	you
00:01:58.12	Mr. City Clerk	Thank you.
00:01:58.88	Mr. City Clerk	Under God, indivisible, the radiation of God's cross.
00:02:04.11	Mr. City Clerk	And then tonight we have only one business item.
00:02:07.94	Mr. City Clerk	That's item 2A, the City Council Review and Recommended Action
00:02:11.81	Mr. City Clerk	uh well i take that back there are several business items they're all related to the budget so i will not go over the agenda again we don't do not have a consent calendar
00:02:20.08	Mr. City Clerk	uh,
00:02:21.24	Mr. City Clerk	But we can begin with item 2A. Would you like to say anything?
00:02:27.25	Unknown	So before we start with our normal business items, mayor, I wanted to make a clarification to some comments I made at our last city council meeting regarding a proposal that the city had received from community venture partners. I expressed my explanation for some of the reasons I voted against that proposal at that time. The principal of community venture partners reached out to me
00:02:53.35	Unknown	alert me to his perspective that some of my perspective was mistaken. I explained to him that I relied on...
00:03:01.54	Unknown	information I had received from members of the community and
00:03:04.93	Unknown	city staff, but
00:03:07.18	Unknown	I acknowledge, you know, reasonable minds can vary on various things. And so I acknowledge that the principle of community venture partners has a different perspective on some of the
00:03:21.11	Unknown	issues that I raised during our discussion last week, and I respect
00:03:25.77	Unknown	his right to have his own views about those things. And I certainly don't take what I say as gospel truth. I'm simply reiterating what I've heard from others. So I just wanted to make that clarification. I also wanna state, I greatly admire a lot of the work that Community Venture Partners does. I just didn't see a fit between that proposal and our needs at that time. So thank you for allowing me
00:03:51.74	Mr. City Clerk	Thank you for...
00:03:52.62	Mr. City Clerk	TO.
00:03:52.81	Unknown	to,
00:03:53.04	Mr. City Clerk	clarify. Thank you. Thank you, Vice Mayor. We will move on to our first business item. That is 2A City Council Review and recommended adoption of a 25% reserve level for general fund contingencies by adding an additional 10% contribution to the economic shortfall fund.
00:04:10.49	Mr. City Clerk	To the current policy amounts of 5% for budget stabilization and 10% for economic shortfall. So city staff, are you giving the presentation? I am, Mayor. Very well.
00:04:18.52	City Manager	I am, Mayor. Very well.
00:04:19.69	Mr. City Clerk	Thank you.
00:04:19.70	City Manager	I will give the presentation to Zapata.
00:04:22.24	City Manager	I want to thank everybody for being here at this special meeting. Really important to make sure that we make the time to work on these important matters, especially in our financial arena. I want to thank the public for paying attention and weighing in as well. I want to thank past councils for the work they've done. I want to note that this city council listed our reserve policies as a priority this past year. And in doing that workshop and that strategy session, we bring this to you tonight. This is not new to Sausalito. In 2011, June of 2011, to hedge against emergencies and create a rainy day fund, the city of Sausalito adopted a resolution, 5% for budget stabilization, and 10% for emergency shortfalls. So that 15% policy has been in place and in writing for the past, you know, 14, 15 years. It's been told to me by people, former Mayor Ray Withey, that there was a practice of the city, taking 10% on top of that and using that as an unofficial hedge as well to create a de facto 25% reserve. So again, these policies are based on governmental accounting standards, board regulations called GASB. Having know, having a rainy day fund is really important for a city, but the amount of that rainy day fund, how they're categorized, what funds they're put into, that's something that is a little bit different in almost every community.
00:06:02.19	City Manager	So in addition to the rainy day fund of the emergency shortfall and the budget stabilization of 15% of our general fund budget, to do some quick math, if we have a 10% reserve policy and we have a $20 million general fund, that means the city must set aside $2 million. If you add 5% on top of that, that's another $500,000. So the city has to set aside $2.5 million on a $20 million general fund that is typically close to what we spend and have in Sausalito. I want to note that these funds are augmented by other funds. The city has had a practice of keeping money in different accounts. The parking fund is an account that the city keeps money in that's separate from this. The MLK fund, the city keeps money here as well. It's separate from the 5% and 10% and the old city hall fund. So these are funds that have been set up as quasi-enterprise funds so that the city, if there's something that is needed at MLK, there's money there to fix it. If there's something needed at the old city hall, there's money there to fix it. And the same with parking and parking lots. So all of that to say the city has been very well managed financially. It has not ever dipped into the 5% or 10% since their inception in 2011.
00:07:30.58	City Manager	Because there is a great variation between what cities are comfortable with and doing with their reserves and how they characterize them and what they want to put into them as an amount. We provided a survey to you. It's in your staff report of all Marin County cities. And the long and short of that are the high is 50 percent in one city. The low is 10 percent in San Rafael. Obviously, bigger cities have bigger budgets, so 10% of San Rafael's budget is $10 million.
00:08:01.49	City Manager	10% of Saucyutu's budget is not $10 million. So it's never an apples to apples comparison. Secondly, what is also important is in your report as well, we looked at other cities close to us, cities under 100,000, cities in Alameda County, cities in Napa County, cities in Sonoma County, and there you have a different range. You have an 8% to a 50% range. So Saucyido is currently at 15% with a practice of 25%. What I'm recommending is that we formalize that additional 10%, look at this annually, see if in fact there's a need to leave it alone or go up. because, again, the comfort level depends on the city council, and you are the ones that set these policies. We make recommendations, and our recommendation, my recommendation is 25% is more than adequate today. Maybe tomorrow it may be too high. Maybe tomorrow it may be too low. But at this point in time, 25% is what you've been doing. It's adequate. I wouldn't go higher than it. Obviously, it's your call to make. So at this point, I open the floor for questions and see if we can get to a determination as to what you want to peg this at, Mayor and Council.
00:09:16.28	Mr. City Clerk	Thank you, city manager. Just one question, is Mr. Hess here, is the director of finance here tonight? He is with us. I sure am. Just curious if he was here. Any questions for my colleagues?
00:09:23.05	Director Hess	I sure am.
00:09:32.85	Mr. City Clerk	who we'd like to start.
00:09:34.71	Councilmember Kelman	A general question, maybe in 2011,
00:09:40.33	Councilmember Kelman	How might we compare the 2011 macroeconomic climate to where we are today? I want to make sure that we're not just trying to compare over time when things have really changed quite dramatically, both for the city in terms of our known climate.
00:09:59.11	Councilmember Kelman	deferred maintenance and our known consolidation needs, as well as just things that have happened in the general economy since 2011. And so as our finance director, are there things that you want us to be aware of as we consider the reserve policy?
00:10:17.61	Councilmember Kelman	You can mention interest rates if you'd like.
00:10:20.24	Councilmember Kelman	Yeah.
00:10:20.78	Director Hess	Yeah. So,
00:10:22.63	Director Hess	You know, I think overall,
00:10:26.55	Director Hess	It's important to look at our risk.
00:10:28.19	Director Hess	There's no one size fits all for all.
00:10:31.29	Director Hess	cities.
00:10:32.40	Director Hess	I think we do need to take a look at our-
00:10:34.45	Mr. City Clerk	Can you lean a little more into your microphone? Yep.
00:10:37.43	Director Hess	Yep.
00:10:38.09	Director Hess	Are you guys sharing me better now?
00:10:39.24	Mr. City Clerk	Now you're great. When you lean back, it's a little bit quieter. That's all.
00:10:41.65	Director Hess	Okay. Sorry about that. Thank you.
00:10:43.61	Director Hess	Um,
00:10:44.52	Director Hess	So based upon
00:10:47.49	Director Hess	Based upon the risks of the city and the comfort level of council, I think a 25% reserve is
00:10:57.23	Director Hess	justifiable.
00:10:58.80	Director Hess	I think if we want to refine that estimate more, we should undertake a thorough risk-based assessment of
00:11:06.98	Director Hess	what risks the city faces, what are the probabilities of those risks, and what are the potential
00:11:12.06	Director Hess	financial impacts of those risks.
00:11:14.14	Director Hess	If you want to get very detailed, that is the way the GFOA
00:11:19.03	Director Hess	is now recommending we address fund balance. In the past, they have always said just a blanket two months reserved.
00:11:25.14	Director Hess	Um,
00:11:25.97	Director Hess	I think that is low.
00:11:27.10	Director Hess	I think having 25% in reserves is sufficient based upon the needs of the city.
00:11:32.06	Director Hess	and the historical trends that I've seen of the city.
00:11:36.38	City Manager	Amir, if I can, I'd like to address that as well. Please.
00:11:41.56	City Manager	You know, is it different today than it was five years ago? Absolutely. But the question is, are the risk and the cost of those risks different? And, you know, I'll give you some examples. In 1999, 2000,.com, bubble burst, cities having trouble. 2006, 2007, you know, Great Recession, cities having trouble. You know, 2020, 21, pandemic, cities having trouble. So cities run through cycles of trouble. It's constant. And the question is, you know, if what you have in your reserve is enough to hedge against those, I think that that's a comfort level you have to have. But we're always going to have conditions that are going to create need and emergency. And so you've been able to manage
00:12:28.67	City Manager	A pandemic.
00:12:30.78	City Manager	I'm assuming that after the Great Recession, that probably spurred some of this move to put money aside. Maybe, you know, putting money aside for your pensions was part of that as well. But you've been putting money aside, and I'd argue you've put too much money aside and have not used that money for things that you could use it for. because if we're sitting on today's dollars and we have today's needs and, you know, we're not maximizing our investment returns or we're not putting them into needed projects that help the community or diminish our infrastructure backlog, why sit on 10 million bucks? You need to put that money to work. so in my mind um you know when i came here and i saw the problem we were into with covid and having to pull money out of the parking enterprise at the same time, getting assistance from the feds,
00:13:22.15	City Manager	Yeah, that was a critical point.
00:13:23.69	City Manager	but we didn't get into our five or 10% then.
00:13:26.57	City Manager	You know, now we're talking about
00:13:28.82	City Manager	you know, $10 million in that account with those combined funds. And I'm assuming that you all will do something that, you know, brings that number up from five to 10%, but it shouldn't be 50%. The environment is, you know, uncertain. But if there is an uncertainty, that's why you have insurance. And that's why you're paying a lot of money for the insurance this year. There's always some type of if there's a true disaster, there's a state and federal and potentially a county response. So you won't be on your own. So, you know, I would not be overly aggressive in adding to that 25%. If you want to go to 30%, no problems. If you want to go higher than that, I'd recommend you don't.
00:14:15.54	Unknown	Um,
00:14:17.23	Unknown	I don't know if I want to address this to the city manager or to chat. You mentioned the 2011 25% but we adopted a resolution in 2018 setting our reserve policy at 25% that year as well 15 and 10 and so.
00:14:36.75	Unknown	We did that by way of resolution when we adopted the budget. We didn't adopt a separate resolution specifically pertaining to the reserve fund. But we did do that in 2018 as well. So I guess my first question was, were you aware of that?
00:14:54.44	City Manager	Yeah, the answer is no.
00:14:56.45	City Manager	So I only know two things. One, what we saw in 2011 and my conversation with Mr. Withy and with the former city manager about when these types of activities occurred. But I wasn't aware of a formal resolution adopting a 25% policy. But thank you, because that's the recommendation.
00:15:12.97	Unknown	Exactly. And I also wanted to distinguish between unassigned fund balance and reserve. If you're talking about reserves, I don't believe our reserves then or today are too high. If you're talking about unassigned fund balance, when you say we are carrying too much, you may have a point. But I am grateful that.
00:15:36.80	Unknown	And so are you talking about unassigned fund balance when you say we're carrying too much?
00:15:42.23	City Manager	Correct. I think, you know, you have a five and 10 and now you're telling me a 25% reserve. That's adequate. Anything above that, you should be putting into projects or investing, but it shouldn't be sitting there idle.
00:15:55.22	Unknown	So given the change in our insurance situation and the uncertainty regarding
00:16:04.94	Unknown	the
00:16:06.23	Unknown	very
00:16:07.68	Unknown	vary the change in our SIR, would you agree that it's prudent to have more unassigned fund balance than perhaps in prior years?
00:16:18.43	City Manager	Yes.
00:16:18.76	Mr. City Clerk	Thank you.
00:16:20.13	Unknown	Those were my questions. Thank you.
00:16:24.50	Mr. City Clerk	That was somewhere happened.
00:16:25.60	Councilmember Hoffman	I'll follow up on that just for a second.
00:16:31.45	Councilmember Hoffman	to the vice mayor's point of unassigned fund balance with regard to the increased risk from our
00:16:38.93	Councilmember Hoffman	increase
00:16:40.99	Councilmember Hoffman	I guess we're going to call it deductible or our self-insured number.
00:16:45.12	Councilmember Hoffman	Right, so that number...
00:16:47.27	Councilmember Hoffman	for next year. Hold on.
00:16:50.10	Councilmember Hoffman	Anybody hearing that feedback?
00:16:51.80	Councilmember Hoffman	That's cool.
00:16:52.73	Councilmember Hoffman	Okay.
00:16:55.40	Councilmember Hoffman	Is it?
00:16:57.71	Councilmember Hoffman	Okay, can I do?
00:16:58.99	Mr. City Clerk	Someone's stealing your car.
00:17:02.07	Mr. City Clerk	Thank you.
00:17:03.52	Councilmember Hoffman	Take it. OK.
00:17:12.09	Councilmember Hoffman	Mike, are you getting this on the...
00:17:13.86	Councilmember Hoffman	Oh.
00:17:15.01	Councilmember Hoffman	You were okay.
00:17:16.91	Councilmember Hoffman	Okay, sorry.
00:17:19.73	Councilmember Hoffman	All right, everybody just
00:17:21.98	Councilmember Hoffman	I think we're okay, but I can feel the dais shaking. Anybody else feel that? Anybody know? Put your hand on the dais.
00:17:29.84	Councilmember Hoffman	It's shaking over here. No one can feel it. Okay.
00:17:32.22	Unknown	Thank you.
00:17:32.26	Sergio	and they're shaped. I see the camera.
00:17:34.97	Unknown	She's on time.
00:17:36.49	Unknown	Thank you.
00:17:36.71	Councilmember Hoffman	Yeah, this, this, it's shaking over here.
00:17:39.12	Councilmember Hoffman	We might check that at a break, figure out what that's about. Okay, back to the budget. So one of the issues with having this in the ordering, I think, of our meeting tonight is that we're talking about what's an appropriate reserve. Our next conversations with regard to our balance, our budget, our balance, our deficit, and
00:18:02.92	Councilmember Hoffman	the last two items, which is our insurance coverage, it will become clearer the risk, I think, of our
00:18:10.44	Councilmember Hoffman	budget for the next year.
00:18:12.64	Councilmember Hoffman	you know,
00:18:13.57	Councilmember Hoffman	One of the things I'm wondering is whether or not we want to
00:18:16.11	Councilmember Hoffman	take action and do the resolution on an increase either
00:18:19.69	Councilmember Hoffman	a 25% reserve, which I think we've already directed, or whether or not we want to have a higher reserve.
00:18:24.33	Councilmember Hoffman	at the end of our, after we do the insurance, the final insurance discussion. So I'll just put that out there and we can discuss that during our discussion. But back to the issue of
00:18:37.76	Councilmember Hoffman	the increased risk against, and this could be either Chad or Chris,
00:18:42.72	Councilmember Hoffman	against
00:18:45.04	Councilmember Hoffman	either calling it a greater unassigned or a greater reserve. And that's my, you know, that's my question.
00:18:54.50	Councilmember Hoffman	you know, an informal unassigned fund balance, or do we would just want to call that a reserve and add that to our reserve for a certain period of time. So as a policy matter,
00:19:03.55	Councilmember Hoffman	we can agree to have a 25% reserve period with a,
00:19:10.54	Councilmember Hoffman	an additional 5% or additional 10% of unassigned
00:19:14.45	Councilmember Hoffman	that is specifically going to address
00:19:17.49	Councilmember Hoffman	certain other unforeseen matters that may come up. And I don't know exactly how to address that, but it may just be,
00:19:24.78	Councilmember Hoffman	we add that to our total reserve and do a higher reserve this year, as opposed to other years. Do you have any thoughts?
00:19:33.69	Councilmember Hoffman	Thoughts on that one way or the other, either you, our attorney, or our
00:19:37.99	Councilmember Hoffman	Finance director.
00:19:39.85	Director Hess	Yeah.
00:19:41.60	Director Hess	As, as it stands now, we,
00:19:44.25	Director Hess	As we address the budget item, we have a planned deficit spend of just over a million dollars.
00:19:50.65	Director Hess	we will still have
00:19:52.42	Director Hess	excess resources
00:19:54.43	Director Hess	of over $6 million as it stands today if we do nothing and change our reserves.
00:20:00.23	Director Hess	If we change our reserves to 25%, we will have
00:20:05.14	Director Hess	roughly
00:20:06.88	Director Hess	one second, we will have
00:20:10.32	Director Hess	500 and
00:20:11.44	Director Hess	66,000
00:20:13.29	Director Hess	or 500.
00:20:14.31	Director Hess	$5,664,924 as a
00:20:19.23	Director Hess	unassigned
00:20:20.43	Director Hess	fund balance.
00:20:21.82	Director Hess	So we will still have a significant unassigned fund balance and we are not planning to spend all of that in this budget.
00:20:28.09	Director Hess	So it's still available in the event that we need to draw funds for a large claim.
00:20:34.39	Councilmember Hoffman	So one of the things that I, and this is why all of these things are interestingly intertwined tonight, because I talked to.
00:20:42.71	Councilmember Hoffman	I talked to our, and I know
00:20:44.98	Councilmember Hoffman	Chad, you know this, and I know Chris, you know this too.
00:20:47.62	Councilmember Hoffman	that our insurance index, the way to bring that down is to attack certain things, not attack, but to take measures to fix certain things that will lower our index. So in other words, we have a high index because we have a high volume of insurance.
00:21:06.10	Councilmember Hoffman	slip and falls. They're not high. They're not high dollar, but it's a high volume. That's an easy thing that we can focus on
00:21:13.16	Councilmember Hoffman	in the next year and direct staff as a policy matter to look at that. There's some other
00:21:20.86	Councilmember Hoffman	efforts that we can
00:21:22.80	Councilmember Hoffman	that we can go after
00:21:25.62	Councilmember Hoffman	Additionally, to decrease our index fund.
00:21:28.78	Councilmember Hoffman	Those things cost money, they cost additional money, though those things will come out of our allocated unallocated fund balance, so the discussion.
00:21:38.11	Councilmember Hoffman	with regard to our policy and our spend for next year,
00:21:40.92	Councilmember Hoffman	should also include those policy issues about what we want to do
00:21:45.53	Councilmember Hoffman	in 2025 or 2024-25.
00:21:51.32	Councilmember Hoffman	I mean, that's why I'm wondering, and that's why this number
00:21:56.05	Councilmember Hoffman	you know, that gets batted around about what our unallocated funds are, are they unallocated or are they just...
00:22:03.76	Councilmember Hoffman	funds that are unspent on necessary capital improvements that are increasing our insurance costs.
00:22:12.13	City Manager	Yeah, that's part of the argument. Had we not had an increase in insurance this year, you'd hear me ask you for a budget that would have said, let's take some of that and invest it in our roads, in our buildings, so that we could, in fact, you know, begin to lower any potential risk associated with sidewalks and buildings that we have now. so that is a problem it's something that you know we can't lose sight of so yeah it's going to be a little bit different taking money and paying insurance for it, but what you're paying for is coverage. And so, you know, Chad and Sergio can walk through the coverage with you, but that extra money that you're paying for after you get past the self-insured retention amount is millions of dollars. The cap is $25 million, is my recollection. So we're paying for it in a number of ways so that we can be secure, that we're not going to do something or something catastrophic is not going to happen in the city so that we can or have a problem with our finances. We have a short-term problem with our finances based on this one year's dues and this one-year requirement. Will that continue into the future? Hope not. I would have to guess that it wouldn't. I think we've got what I call the worst end of the insurance bill this year because obviously we had a 10-year run of bad things happen and we're in a bad insurance market. And so we're paying top dollar, paying a million dollars more than we paid last year. And that, in effect, can't continue because obviously you're drawing into your
00:23:41.88	City Manager	your unassigned cash to pay for that.
00:23:44.25	City Manager	but you do have other resources that you can attach to any potential problems. And your point earlier about having policies in place that minimize our risk. Yeah, exactly. You know, the Miller Pacific study that said, we need to look at our land use regulations for hillsides and what we need to do with that. That's important. The idea of sidewalk maintenance and, you know, that responsibility being worked on by our community and partnership with the city. That's important. Looking at our businesses and our buildings specifically,
00:24:12.71	City Manager	or buildings in our
00:24:14.10	City Manager	infrastructure and assessing what that need is so we can
00:24:17.64	City Manager	begin to decide which one do we do first. We know there's a big gap. There is a big need there, but no one's told me do this building first or that street first, but that's what that will lead us to. And then last but not least, you know, you have a new revenue coming in through Measure L that you really should think about how you use, because there are ways to use that to fund the current level of infrastructure, but there are also ways to use that to advance that through
00:24:44.47	City Manager	you know, different ways of financing
00:24:46.89	City Manager	improvements today with today's dollars. So you don't have to do it, but it could be a trade-off between money down the road seven years from now where Measure L has expired and money gotten today. So, you know, we want to bring all of that to you, but, you know, today we're talking about insurance costs that I believe have peaked.
00:25:05.87	City Manager	I could be wrong.
00:25:08.02	City Manager	But, you know, I believe we have a peaking situation that they will level off and ultimately come down to something more manageable. But this year it's not that way.
00:25:18.95	Councilmember Hoffman	So that's a little bit different than the conversation I had with our city attorney earlier.
00:25:24.45	Councilmember Hoffman	and what's been presented to us.
00:25:26.69	Councilmember Hoffman	My understanding was that our increased insurance was the best possible that we could get. It's high, but it's the it's the best that we could possibly get on any market.
00:25:36.70	Councilmember Hoffman	And that it's likely going to stay this way for until we can
00:25:40.72	Councilmember Hoffman	bring down the factors that led to this high cost.
00:25:44.38	Councilmember Hoffman	Meaning, what are we going to change how we're doing? And if we don't change what we're doing, our number is not going to come down.
00:25:51.03	Councilmember Hoffman	You would agree with that?
00:25:52.58	City Manager	Yeah. And I'd also say we are changing what we're doing. That's why we're having this conversation. That's why you authorize the risk manager being hired. That's why we've gone off and said, you know, we need money for infrastructure. That's why we're doing these assessments of our facilities. All those things are in process and there's still more to do, but we're not sitting on our hands.
00:26:09.86	Councilmember Hoffman	But as I understand it,
00:26:11.70	Councilmember Hoffman	We are going to meet with the insurance company in six months.
00:26:16.17	Councilmember Hoffman	and present them with how we're doing
00:26:19.01	Councilmember Hoffman	And if we're not doing well, our insurance costs are going to go up further.
00:26:22.91	Councilmember Hoffman	If we're doing if we can present to them.
00:26:27.07	Councilmember Hoffman	you know, real evidence that our insurance costs would go down. And I've never heard of, frankly, insurance costs going down, but I'm hopeful that
00:26:34.58	Councilmember Hoffman	And I think if we try really hard and we work really hard between now and then,
00:26:38.68	Councilmember Hoffman	maybe we can make a good argument,
00:26:41.08	Councilmember Hoffman	I haven't seen anything that
00:26:43.61	Councilmember Hoffman	or there hasn't been any presentation to us that I'm aware of,
00:26:47.58	Councilmember Hoffman	So your statement just now that this is the idea is that this year is an anomaly and that we can expect
00:26:53.97	Councilmember Hoffman	with any certainty.
00:26:55.74	Councilmember Hoffman	any hope
00:26:56.91	Councilmember Hoffman	that our insurance costs are gonna go down.
00:26:58.83	Councilmember Hoffman	We,
00:26:59.59	Councilmember Hoffman	Maybe.
00:27:00.59	Councilmember Hoffman	I mean,
00:27:01.68	Councilmember Hoffman	But we won't know that until six months out.
00:27:04.01	Councilmember Hoffman	And we'll know in six months whether or not it looks like they're going to go down.
00:27:07.88	Councilmember Hoffman	And I know we're digressing to other things on tonight's agenda, but that's my point, right?
00:27:14.91	Councilmember Hoffman	what an appropriate
00:27:16.84	Councilmember Hoffman	Reserve is depends on the policy decisions that we make later in the meeting and
00:27:22.07	Councilmember Hoffman	and the reserve versus unallocated funds that we're going to set aside
00:27:28.67	Councilmember Hoffman	informally, I suppose, to address increased risk factors. So that's why I'm a little bit uncomfortable because I know we're gonna talk about all these things later. If we get to a certain point where we've decided
00:27:40.23	Councilmember Hoffman	you know, with our policy decisions as we move through the
00:27:44.02	Councilmember Hoffman	through the agenda, then I think we can have a lower reserve.
00:27:47.48	Councilmember Hoffman	not do that, then I think we need to have a higher reserve. So that's my position.
00:27:51.90	Mr. City Clerk	No.
00:27:53.12	Kathy Nikitas	Good night.
00:27:53.39	Mr. City Clerk	Vice Mayor next, and then Council Member Blalstein.
00:27:56.98	Unknown	I just wanted to ask a couple of follow on questions to clarify some of Councilmember Hoffman's questions. So this may be for the city attorney. City attorney use it. How would insurance premiums go down by way of example workers comp insurance is priced based on an EMR or experience modification rate isn't that right.
00:28:19.51	Sergio	Yes, as is our general liability insurance and I suspect also our property insurance as well.
00:28:25.70	Unknown	And the EMR is a three year running calculation, correct?
00:28:30.38	Sergio	I think it depends on between risk pools and also on the private insurance market. I have been told that it's typically a five-year rolling average that is frequently used. But yes, it will depend based on what PRISM's program is.
00:28:46.39	Unknown	And so looking at our workers comp, we had two huge incidents in the last two years, which were unusual, and which are very unlikely to recur with respect to two very senior members of our police department. Isn't that right?
00:29:02.88	Sergio	Yes.
00:29:03.71	Unknown	And so the most recent of those is already a year behind us. The other is two years behind us. And so in the third year or certainly in the fifth year, that EMR, barring any other major issues, would certainly be expected to go down. Yes?
00:29:20.41	Sergio	Yes.
00:29:21.60	Unknown	Speaking to our general liability, we had
00:29:26.00	Unknown	Thank you.
00:29:26.07	Unknown	two huge events, not just small slip and falls, which didn't amount to a lot, but
00:29:32.21	Unknown	in terms monetarily, but a landslide in 2019 and a homeless encampment in 2020.
00:29:39.38	Unknown	Again, those are two unicorn events. Wouldn't you agree?
00:29:44.31	Sergio	Um, yes, at least in terms of the intensity and the severity and the number of claims that those generated.
00:29:51.60	Unknown	And the expense and the overall expense. When you look at our claims expense, those accounted for a lot of the reason that our payouts versus our premiums were at a percentage that was unacceptable to BCJPA. Wouldn't you agree?
00:30:15.33	Sergio	Yes, that was definitely a significant contributing factor.
00:30:18.58	Unknown	And so again, those events are already three, four years behind us. And so our rolling five-year average, barring other events, would be expected to go down next year. Would you agree?
00:30:31.00	Sergio	I do agree with that.
00:30:32.69	Unknown	And isn't it true that this year our insurance claims have been way down compared to prior years in terms of numerosity and amount?
00:30:45.38	Sergio	This particular year, yes, has been a very good year since at least October.
00:30:50.29	Unknown	And so that also would bode well towards an anticipation that our three or five year rolling average in terms of calculation of premium would be in a downward direction. Yes?
00:31:03.86	Sergio	At this point, that's what we expect.
00:31:05.77	Unknown	And so, and then we're doing the things that Prism asked of us by hiring a risk manager. We've adopted some geological projects.
00:31:16.14	Unknown	Um,
00:31:17.54	Unknown	uh,
00:31:18.44	Unknown	to address landslides. We are in the process of changing sidewalk management policies. We're devoting Measure L funds to improving infrastructure. We're considering sewer consolidation, which will get us out of the collection business and reduce those infrastructure issues. So all of those things combined, wouldn't you agree, would also militate towards lower insurance premiums moving forward.
00:31:48.22	Sergio	I agree. I agree that they would. Obviously those are going to be
00:31:52.47	Sergio	ongoing processes for the city and, you know, radical change doesn't happen overnight. But I think the general trend is that the city is doing everything possible to try and lower its risk profile, including undertaking all of those programs you just mentioned.
00:32:07.12	Unknown	And then finally, with respect to the, and this may be for the city manager, with respect to the reserve policy, you're asking us tonight as part of the budget, because we must do this as part of the budget to adopt
00:32:18.78	Unknown	An amount, but isn't it true that you plan to come back to us with a policy regarding what could be spent from that reserve versus what would be allocated to unassigned fund balance and other resources.
00:32:35.62	City Manager	Yeah, I think you're a couple of steps ahead of me, Vice Mayor. What I'm trying to get through tonight is, you know, if you want to make 25 percent the number you're comfortable with, you want to revisit that in a year. It may be too low. Or tonight you want to go higher or lower. You know, just getting something started in terms of a conversation. Because, again, at the retreat, this is one of the things you said is one of your six priorities. We want to talk about what our reserve policy should be. And so this is not to be the end all be all. It's to start that discussion in earnest. And I think, you know, learning from you tonight that, you know, we had something adopted in 2018. Thank you for that. You know, learning from the former city manager, what happened in 2011, that was important. But tonight is just another chapter. But we don't have the end result in mind right now. I don't. I think I know what I would feel comfortable recommending. And that's why I said add 10% to the existing. But it seems to me that's already been done. If you want to do more than that, like I said, 5% more, go to 30, great. higher than that, I would have some recommendations that, you know, you're putting money in a mattress when your windows are falling apart.
00:33:48.15	Unknown	And would you agree that we have other opportunities after tonight to recalibrate these numbers, should it be appropriate, such as the mid-year budget?
00:33:59.00	City Manager	Thank you.
00:33:59.04	City Manager	Absolutely.
00:34:00.10	Unknown	And so between now and the mid-year budget,
00:34:04.89	Unknown	Are you anticipating that we will make further progress on our evaluation of our existing facilities, our sewer consolidation, our implementation of the GHAD measures, our implementation of sidewalk repair approach, and other measures designed to
00:34:26.90	Unknown	Um,
00:34:28.06	Unknown	better understand and
00:34:30.53	Unknown	plan for those issues that could lead to claims.
00:34:36.38	City Manager	Yes, and I think one of the most important ones is we're getting set to contract out with a retired risk manager that PRISM has recommended to us while we're trying to hire a full-time risk manager, because that is really going to be one of the driving factors to all of those things that someone worked with all of our departments, city council, our stakeholders on how we move these things forward, because it's a comprehensive approach to lowering, lowering our risk profile. It's not just one action. So you laid out the ones that we laid out for the underwriting committee at PRISM. They seem to agree with them. I think the one thing that we also told them that is really important is we don't have a fire department in Sausalito, and we have a very safe city. It's not to say that something couldn't happen in Sausalito, but our violent crime in Sausalito is practically non-existent. And so those are the things that worry other cities. You know, what's going to happen with something in public safety? We obviously have some concerns about some natural and geographic concerns. But I think that if we do the things that you laid out and the risk manager and I work with Chad and Sergio and the rest of departments very diligently, then we should be able to come back to you and say, and also to PRISM in the six-month period, look what we've done. Because it needed to be done. It should have been done a long time ago. It's being done now and with haste.
00:36:03.19	Unknown	Thank you, City Manager.
00:36:05.13	Unknown	Oh, city attorney.
00:36:06.29	Mr. City Clerk	Councilmember Blustein, then the Councilmember Chalman.
00:36:09.48	Councilmember Blustein	Great, thank you. To follow along on some of the vice-merc's questions, City Manager, you sent a letter on June 3rd to Scott Schminke, who's the chair of Underwriting Committee at PRISM, right? Yes.
00:36:20.42	Councilmember Blustein	correct. Okay. And in that letter, you identified some of the things that are being prioritized to improve our risk profile, correct? Yes. Okay. So I'm going to read them. You can tell me if I'm missing one. So the settlement of the legal case with the compassionate closure of the homeless encampment, which we spoke of, which was a significant cost, correct? Okay. And then the approval of the risk manager position, which we've discussed, the ongoing review of our loss history to target resources and minimize risk in programs, policies and facilities. Is that going to cost additional funds to the city for that ongoing review?
00:36:20.47	City Manager	correct?
00:36:26.78	City Manager	Yes.
00:36:52.09	City Manager	Well, that's a part of our internal work that we have to do and will be front and center for our risk manager.
00:36:58.79	Councilmember Blustein	Okay. And then we've also completed the geologic hazard report, which is listed here, correct? Correct. Okay. And then working with historic insurance providers to spread risk and exploration of catastrophic insurance to layer on top of existing coverage. That's ongoing, correct?
00:37:12.19	City Manager	Yeah, that's what we showed them how we were a little more sophisticated than most cities.
00:37:16.80	Councilmember Blustein	Okay. And then you mentioned disaster preparedness agreements and training with Marin County. Those are ongoing. Correct. And are those at a cost to the city?
00:37:21.88	City Manager	Correct.
00:37:24.41	City Manager	Uh, we, their internal costs, uh, we share them with our partners.
00:37:28.81	Councilmember Blustein	Okay, and you list continuing to work on utility undergrounding opportunities with PG&E and private residents. Again, is that an additional cost to the city?
00:37:35.86	City Manager	Staff time.
00:37:36.81	Councilmember Blustein	Staff time. Okay.
00:37:38.23	Councilmember Blustein	organization-wide training exercise for the active shooter simulation and cybersecurity training for all employees.
00:37:43.90	Kathy Nikitas	Yes.
00:37:44.10	Councilmember Blustein	Okay. And then city council to consolidate departments, which we've talked about.
00:37:48.96	Councilmember Blustein	And then you list as well the passage of Measure L, which will generate $24 million over the next eight years for infrastructure needs. So you have a plan for implementing that with regards to our insurance risk profile. Correct. Okay. And then the million dollar sea level rise adaptation grant for the risk assessment. Okay. And when you shared this with PRISM, they responded positively, correct?
00:38:00.82	City Manager	Correct.
00:38:12.31	City Manager	Well,
00:38:12.77	City Manager	This was in June. My understanding was in May. Without that information, they were going to deny us. After we shared this with them, the city attorney and myself, they voted 8-1 to approve us as an underwriting committee and forward us the membership. Because we wanted to show them motion and awareness and, you know, just being aggressively going after our risk profile in a way that would lower it. And so I think we made our point, and that's why we received an 8-1 support from that committee. It then went to the executive committee, and now you have in front of you tonight a membership opportunity, which we were really concerned about because, as you recall, a month and a half ago we were looking at a $4 million private
00:38:55.46	Unknown	Mm-hmm.
00:38:56.44	City Manager	package, and now we're staring at a $1 million extra pool package.
00:39:02.01	Councilmember Blustein	And I hate to bring this up, Director Hess, because I know you feel very bad about it, but we did see that, in fact, our deficit from this potential cost was a million, not two million, correct?
00:39:11.87	Councilmember Hoffman	Correct, yes.
00:39:12.71	Director Hess	Thank you.
00:39:12.93	Councilmember Blustein	Okay. And you spent, okay. Thank you for that. And, and city manager, you spent significant time with our staff to get to the best possible risk profile at this presentation.
00:39:23.38	City Manager	I can't tell you how much time the city attorney, the finance director, the human resources manager, and our former consultant, Deborah, much more spent with our staff to get 10 years' worth of history on facilities, buildings, court claims, submit them to five different pools plus the private sector. It was quite the lift. But, yeah, we spent a lot of time doing that, and here we are almost at the finish line with PRISM.
00:39:46.86	Councilmember Blustein	And going into the six month assessment, based on your current discussions with PRISM, the idea is that a conversation is to encourage a reduction in the premium following these steps.
00:39:56.62	City Manager	We want to solidify our membership with them. We want to show them that we're not bad actors and that this should result in them being more, not as difficult with their pricing in the future if we decide to stay with them.
00:40:12.26	Councilmember Blustein	And this might be a silly question, but the point of holding insurance is to cover potential risk that we might ensue beyond our
00:40:18.66	Councilmember Blustein	25 or 30% or 15% reserve, correct?
00:40:22.45	City Manager	Yes.
00:40:23.38	Councilmember Blustein	And in the past, have we dipped into our reserves in the event of a catastrophic event?
00:40:27.89	City Manager	Not to my knowledge.
00:40:29.03	Councilmember Blustein	Okay, so we're holding insurance and we have not yet dipped into our 15% reserve, and yet you are suggesting an additional 10% increase in our existing reserves.
00:40:36.38	City Manager	That's correct.
00:40:37.32	Councilmember Blustein	Okay. And so going forward, it's, I'm sorry, I want to bring my attention, your attention to one other piece of your staff report where you said, and it's, I believe in the last paragraph quote, however, if Sausalito included its 115 trust fund for pension and its calculation to add to its existing 15% and unassigned cash at over $7.7 million, it would be well over 50% of unassigned as of July 1st, 2023. Okay.
00:41:01.66	City Manager	Yeah, that's accurate. And the premise there is you have $3.7 million in your pension trust and I believe another $2 million in your post-employment benefit. And if you choose to offset general fund expenses with that money, that's legal for pensions and post-employment benefits. So in theory, if you had a $5 million problem and no money, you could use all of that money to balance your budget, even if it's all general fund expenses. So that's additive to the 5% to 10% and the unassigned. So it's there. And again, I mentioned earlier, you have other funds that involve MLK. I believe there's a million dollars in that fund. There is some money in the parking fund. I think we reached into our old city hall fund this year to do some work that have kind of zeroed that out. But those are other sources of fund that could be tapped in a general fund way if you had the need. So it's not just those three funds, there are additional funds as well.
00:41:47.10	Director Phipps	Mm-hmm.
00:41:57.88	Councilmember Blustein	Okay. And then you said in the staff report, it's also important to note that SOSLUETA will finish this year, ending June 30th in the black, positive with more annual revenue in the general fund than annual expense. Director Hess, is that accurate?
00:42:11.23	Director Hess	Yes, that is correct.
00:42:13.44	Councilmember Blustein	Okay. So we'll be ending the year in a positive, a net positive, and you're asking for an additional reserve, but we have never dipped into our reserves.
00:42:23.48	City Manager	Yes, but we're in a different circumstance this year. Last year was last year. This year is, you know, we already know that we're going to have to pay those costs for additional costs for insurance. We know we're going to have to pay the additional costs for our pensions, and we're projecting a downturn in our sales tax.
00:42:40.04	Councilmember Kelman	Thank you.
00:42:40.05	Councilmember Blustein	Okay, great. Thank you very much, city manager.
00:42:42.09	Mr. City Clerk	Councilmember Kelman.
00:42:43.87	Councilmember Blustein	Thank you.
00:42:43.90	Councilmember Kelman	Thank you. Thank you to my colleagues. A lot of good diligence and research and very helpful.
00:42:49.64	Councilmember Kelman	I want to excuse me.
00:42:51.59	Councilmember Kelman	getting over a cold, I want to take a slightly different approach, which is I think what maybe would all benefit from is an agreed upon structure and criteria for deciding on the reserves. So thank you, city manager, you and staff have put together some really excellent background information and trajectory. But what I want to dive into are three areas that have been mentioned by some of my colleagues that I think should influence our decision on reserve size and see if we can get some consensus around what those might be. So the first, obviously, is risk mitigation.
00:43:25.34	Councilmember Kelman	So we know that during COVID, we had this buffer, which was a great thing to have in the bank. But I also urge us to remember that the city is very unique. We are a big property owner. A lot of other cities are not a big property owner. Therefore, we are landlords and are responsible for things that are unforeseen in our structures. we run a number of classes and events that have their own consultants for things that are unforeseen in our structures. We run a number of classes and events that have their own consultants and contractors that have to be accounted for. And we found out some of the troubles with that this year. We have some climate resilience issues. I'm sure everybody recalls the March, 2023 Coast Guard video that was sent to us showing the storm surge coming up and over the riprap
00:44:13.20	Councilmember Kelman	on Bridgeway and hitting a vehicle driving northbound. These are things that I can't predict, but I am seeing more and more of them. We have proof of them here in town.
00:44:23.34	Councilmember Kelman	And then, of course, deferred maintenance, we have a physical infrastructure assessment.
00:44:27.46	Councilmember Kelman	And so I think the city has some unique
00:44:30.53	Councilmember Kelman	concerns that need to be weighed carefully
00:44:33.54	Councilmember Kelman	And so I would urge that risk mitigation be the first bucket. I'm sure there are others that I've missed.
00:44:38.20	Councilmember Kelman	The second, and I think the finance director alluded to this, is stability and credit worthiness. I think Councilman Hoffman was asking about this, that cities with robust reserves could be viewed more favorably by credit rating agencies, maybe lowering borrowing costs for infrastructure projects,
00:44:54.82	Councilmember Kelman	I don't think we've discussed that enough. And I would like to really understand that trade-off.
00:45:01.03	Councilmember Kelman	So if we keep money available to spend, but putting in the reserve opens up better loan terms for us, I want to understand that tradeoff. And then the third, and the city manager mentioned this in his response to my first question, was around flexibility for investments. We have not been that strategic in investing our monies, and thanks to the now mayor, we found an opportunity to improve that. And there's probably others. So those are the three that I think about when I think about a reserve policy. anything about risk mitigation, stability and creditworthiness, and flexibility for investors. we found an opportunity to improve that. And there's probably others. So those are the three that I think about when I think about a reserve policy. I think about risk mitigation, stability and credit worthiness, and flexibility for investments. I would also say that the specific size of the reserves should reflect three other things. Our revenue volatility,
00:45:40.60	Councilmember Kelman	So we should be talking about the sales tax decline that we're experiencing right now?
00:45:44.89	Councilmember Kelman	We should talk about the uptick in TOT that we're experiencing right now and understanding why and what the COVID rebound looked like. We should be looking at potential economic risks to us. That's mostly around tourism, but it could be other things.
00:46:00.09	Councilmember Kelman	And then we should be looking at our long-term financial goals. I think the biggest one is how to pay down our pension debt.
00:46:05.34	Councilmember Kelman	And we haven't talked about that in the context of the Reserve yet.
00:46:08.76	Councilmember Kelman	So with all of that said, my goal tonight would be that we agree upon the buckets of criteria.
00:46:15.43	Councilmember Kelman	because we're not the first or will we be the last counsel to evaluate this and create some consistency in that analysis. And then to the vice members point,
00:46:24.73	Councilmember Kelman	Revisit this with a mid-year budget with a Gantt chart timeline
00:46:29.79	Councilmember Kelman	to evaluate whether we should add an additional 5%
00:46:32.81	Councilmember Kelman	based on our ability to achieve
00:46:36.49	Councilmember Kelman	the suggestions in the GAD
00:46:39.02	Councilmember Kelman	I mean, it took a very long time to even get to the GAD.
00:46:42.31	Councilmember Kelman	So how far will we be in six months?
00:46:45.28	Councilmember Kelman	our sidewalk program, how far will we be in six months, our sewer consolidation, hiring a risk manager, our road improvement.
00:46:53.77	Councilmember Kelman	How far can we really get in six months knowing that so many of these things are policies that are excellent policies but can take a long time to implement? And so I just want to be very practical about that over a specific time period. And, yes, I'm going to say it. Back to the smart goals. I want it to be specific and measurable over a time frame. So I don't know, Mayor, if that's kind of where my brain is going. There's lots of good information from staff. I don't want to debate any of it. I just want there to be structure around the analysis so we can all come to the same place.
00:47:21.85	Mr. City Clerk	Why don't we take public comment and then we'll continue our discussion. So public comment, city clerk.
00:47:27.25	Babette McDougall	Members of the public who would like to make comments. If you're on Zoom, you can use the raise hand function. If you are, you can just go up, miss, but Google and we'll.
00:47:42.89	Miss McDougal	I hope.
00:47:43.79	Miss McDougal	Thank you.
00:47:45.12	Miss McDougal	Good evening.
00:47:46.37	Miss McDougal	And thank you for having this special meeting just to talk about the numbers. It's about time.
00:47:52.16	Miss McDougal	I'm sorry I arrived about five or ten minutes late, so I missed the pledge. I'm sorry. But I probably missed some really important data.
00:48:00.34	Miss McDougal	So I don't know if you started by giving a quick summary on
00:48:04.36	Miss McDougal	How's it working out for 2024? We had a lot of exceptional things happen.
00:48:10.16	Miss McDougal	First thing that comes to my mind is the Sausalito Center for the Arts and the realization among the community for the very first time of this huge economic loss to the city.
00:48:20.69	Miss McDougal	because a rental lease was not
00:48:23.34	Miss McDougal	Legally Honored.
00:48:25.30	Miss McDougal	and some special deal was made as an interim measure,
00:48:28.94	Miss McDougal	Then yet another deal was made here at the council for an interim measure.
00:48:33.30	Miss McDougal	But then nobody heard anything after that.
00:48:35.76	Miss McDougal	Meantime, I hear the chamber's going to move in, too.
00:48:39.27	Miss McDougal	Does anybody know anything about that? So where are we in 2024 in terms of how the city's working out? And then we went forward to say, let's take a chance on the PBIT, which I'm all in favor of as long as we understand the upside and the downside, because city equals citizens. So whatever the city puts itself on the hook for...
00:49:01.02	Miss McDougal	Folks.
00:49:02.27	Miss McDougal	You're putting every single one of the citizens on the hook floor.
00:49:06.86	Miss McDougal	All right. Well, I have a lot of other budget questions too, but thank you.
00:49:13.71	Babette McDougall	No further public comment.
00:49:16.34	Mr. City Clerk	Oh, wait. If you're with me. Good for him.
00:49:16.94	Babette McDougall	Sorry.
00:49:25.17	Unknown	Good evening, counsel. I wasn't actually going to make public comment, but...
00:49:32.09	Unknown	You know, if you listen to what the city manager says about, and correctly so, about our general fund balance.
00:49:40.17	Unknown	But I've won 15 trust funds. But the money we have stashed away in our enterprise funds, okay, I would hazard a guess that we are the most financially endowed city relative to our general fund in the whole of Marin County.
00:49:59.36	Unknown	Number one, number two.
00:50:01.94	Unknown	Um,
00:50:03.82	Unknown	You can change your reserve policy anytime you want.
00:50:08.71	Unknown	All you've got to have is an appropriately agendized meeting.
00:50:14.14	Unknown	Okay, so 25%, I fully support. I think we should move up to that. And that would still give you 5.5 million,
00:50:27.20	Unknown	At the end of this year, $4.5 million because of our $1 million deficit. $5.5 million currently of fund balance in excess of reserves.
00:50:38.80	Unknown	You can call it unassigned. You can call it whatever you want.
00:50:42.36	Unknown	And what a reserve policy means is that the council needs to take special action to dip into it.
00:50:49.68	Unknown	You have a $4 million or $5 million cushion
00:50:52.84	Unknown	that it's up to you by resolutions
00:50:56.26	Unknown	to actually use.
00:50:59.30	Unknown	And if you want to use it for infrastructure,
00:51:01.71	Unknown	you will pass a resolution and use it. If you want to use it to supplement further the $5.7 million in 115 trust funds, you can pass a resolution and do it. So the issue of setting the reserve is what is the amount that you are going to debate about
00:51:22.40	Unknown	Bye.
00:51:23.06	Unknown	to use above it.
00:51:25.95	Unknown	Period.
00:51:26.70	Unknown	So very simple.
00:51:28.11	Unknown	decision.
00:51:31.38	Babette McDougall	Okay, no further public comment.
00:51:33.98	Mr. City Clerk	Thanks, we'll close public comment and bring it back up here. And just to kick it off, we'll just make a motion
00:51:38.64	Mr. City Clerk	The recommended motion increased the overall general fund reserve policy from 15 to 25% by requiring
00:51:44.26	Mr. City Clerk	An additional 10% in the economic shortfall fund with annual review during budgeted adoption effective July 1st, 2024.
00:51:50.94	Unknown	Second.
00:51:51.34	Councilmember Kelman	Thank you.
00:51:52.29	Mr. City Clerk	So that motion's on the table for discussion. We have discussion, but Council Member Kellman,
00:51:53.49	Unknown	discussion.
00:51:55.95	Councilmember Kelman	Yeah. Mayor, will you entertain a friendly amendment that we establish criteria to review in the future so we can have some consistency? And the ones I would recommend, we risk mitigation.
00:52:07.71	Councilmember Kelman	stability and credit worthiness.
00:52:10.83	Councilmember Kelman	and flexibility for investments.
00:52:16.40	Mr. City Clerk	Thank you.
00:52:16.69	Mr. City Clerk	Can we tighten that up? I'm trying to think how to tighten up the language.
00:52:19.51	Councilmember Kelman	Sure, certainly. And I just want to put on the table. The reason that I want to do this is because so easy to talk about
00:52:25.43	Councilmember Kelman	numbers as though they're unattached to really anything. And I want to attach them to things. I want to attach them to clear outcomes and clear needs. And, you know, although I believe very strongly in the sidewalk program and the sewer consolidation effort and hiring a risk manager, these things take a long time and they'll take a long time for us to see the benefits. And if the reduction in the insurance premiums and the reduction in our risk profile is tied to our achievement of these goals,
00:52:52.99	Councilmember Kelman	then we need to be very clear about that and revisit that in some type of frequent cadence to measure our success in achieving those goals.
00:52:59.64	Mr. City Clerk	Could we make this motion and then separately do direction along the lines of what you're saying? That it comes back in six months? So let's keep this motion clean. And before we leave this topic,
00:53:04.11	Councilmember Kelman	I think so.
00:53:10.05	Mr. City Clerk	tighten up the language if you want to screw something down so that it's tight as direction to staff and we may discuss that as a separate motion. Sure.
00:53:18.22	Unknown	I was just going to agree with the tightening of the language. Yeah. And did staff get the direction from
00:53:22.82	Mr. City Clerk	Council members.
00:53:22.86	Unknown	Council member Kelman.
00:53:24.22	Mr. City Clerk	We could.
00:53:25.32	Mr. City Clerk	Do you want to take an opportunity to tighten it up? We'll act on this motion, or are you satisfied with what you said as sufficient direction?
00:53:33.30	Mr. City Clerk	Thank you.
00:53:33.39	Unknown	Okay.
00:53:35.68	Mr. City Clerk	I just want to make sure you're satisfied that it was effectively communicated to the city clerk and that he heard what you think you said.
00:53:42.46	Councilmember Kelman	Yeah, the reason why I wanted it in the motion mirror is because
00:53:47.41	Councilmember Kelman	We talk about the reserves like it's just a bucket of money in a rainy day account, and it can't be. It has to be tied to a policy objective. We have to agree on what that policy objective is. Otherwise, the conversation we then have about the budget doesn't have as much...
00:54:00.76	Councilmember Kelman	force and importance. And so this helps us prioritize, hey, look, if we're saying that 25% is enough and we don't need an additional five, then we really, in the next conversation, we're going to need to really focus on the GAD, the sidewalk, sewer, right? We're really going to do that because we just said we only need 25 because we're going to get there through these other things. And that's where I want to find agreement.
00:54:20.25	Mr. City Clerk	So how about we modify it to bring it back for affirmation in six months and...
00:54:25.53	Unknown	Well,
00:54:25.82	Mr. City Clerk	Thank you.
00:54:26.20	Unknown	We already have it as a top six priority to establish a reserve policy. So that's already...
00:54:31.77	Unknown	the top priority for the city manager. So I think that what we're doing is refining the direction to the city manager,
00:54:39.10	Unknown	for establishing that policy. If you want to set a time limit,
00:54:42.91	Unknown	That's fine. But that's one of our six top priorities for the year.
00:54:46.39	Councilmember Kelman	So vice versa, thank you for that. I'm wondering maybe I'm maybe I'm the confused one. What I what I want to do is make sure that the reserve policy
00:54:53.63	Councilmember Kelman	has an explanation associated with it.
00:54:56.76	Councilmember Kelman	Right. So we judge our reserve policy based on these three things, these four things. These are the criteria for our reserve policy, as opposed to just having a reserve policy that is a number.
00:55:06.23	Councilmember Kelman	Right. Okay. I agree. And so, great. So the policy that comes back would have the criteria. Right.
00:55:06.57	Mr. City Clerk	Thank you.
00:55:06.62	Sandra Bushmaker	I agree.
00:55:07.92	Sandra Bushmaker	the reason that comes
00:55:10.97	Unknown	you
00:55:11.33	Councilmember Kelman	Yes. Thank you.
00:55:14.28	Mr. City Clerk	Okay. So the motion's
00:55:15.73	Unknown	So the motion stands and we've given direction to staff based on a majority of the Council so far, but
00:55:22.92	Mr. City Clerk	Let's go right ahead, Councilor Waird Hoffman.
00:55:24.79	Councilmember Hoffman	So, you know, to put my position in context in light of the public comments and the discussion that we've had up here at the council, which I think interestingly, we're all sort of driving toward the same thing.
00:55:37.62	Councilmember Hoffman	But
00:55:38.41	Councilmember Hoffman	um here here's my issue is we have this to council member kelman's point
00:55:43.68	Councilmember Hoffman	We have this reserve policy. We don't really define what we mean by the reserve policy. So the reserve policy shouldn't be this amorphous rainy day fund. It should be tied to certain policy decisions.
00:55:56.62	Councilmember Hoffman	My conversation and my questions with regard to
00:56:00.05	Councilmember Hoffman	other things that are on the agenda later. In other words, what are we going to spend? You know, we have our budget that we're going to receive. That's going to have about a million dollar deficit in it. We are going to have, uh,
00:56:11.35	Councilmember Hoffman	funds above that, unallocated funds above that,
00:56:14.39	Councilmember Hoffman	But as I said, I would not like to keep
00:56:18.24	Councilmember Hoffman	$4.5 million in unallocated funds, giving
00:56:21.56	Councilmember Hoffman	Um, the risk factors that we have currently in town that are known
00:56:25.75	Councilmember Hoffman	and that spending money on addressing those risk factors with regard to infrastructure mainly,
00:56:31.16	Councilmember Hoffman	we can bring a
00:56:34.25	Councilmember Hoffman	increase the safety of our town.
00:56:35.91	Councilmember Hoffman	But B, bring our insurance costs down. And that's the...
00:56:41.93	Councilmember Hoffman	What I don't want to do is spend too much of our unallocated reserve or unallocated funds and just have the reserve left or have a very small amount above the reserve. That's what that's the number that I'm trying to drive forward.
00:56:53.66	Councilmember Hoffman	That's the conversation.
00:56:55.07	Councilmember Hoffman	that I hope that we would have had tonight.
00:56:57.37	Councilmember Hoffman	And that I think it's really difficult to have it without having the information in those things that are later on the budget.
00:57:02.94	Councilmember Hoffman	all of the things, all of the great work that the staff did and all of the analysis that the staff did about
00:57:08.30	Councilmember Hoffman	We're decreasing our costs.
00:57:10.74	Councilmember Hoffman	We have
00:57:11.70	Councilmember Hoffman	uh,
00:57:12.52	Councilmember Hoffman	We have two unicorns in the past, maybe three, but I think if you have more than one unicorn, then they're no longer unicorns by definition. Unicorns are an unanticipated, you know,
00:57:22.80	Councilmember Hoffman	outlier. We, you know, landslides in Sausalito are not unanticipated. We know we're going to have, we know we're going to have landslides. We had a very serious one in 2000, sorry, 1999, I think.
00:57:34.88	Councilmember Hoffman	98.
00:57:35.76	Councilmember Hoffman	We had another very serious one in 2019. We constantly have landslides all over town. So, I mean, not all over town, but every year, depending upon our rain, we have landslides. We also have, as the Council Member Kellman talked about, subsidence and sea level rise issues. So we have, because of our...
00:57:52.91	Councilmember Hoffman	unique
00:57:54.24	Councilmember Hoffman	geographic location, we have a lot of
00:57:57.80	Councilmember Hoffman	risk, which is reflected now in our insurance costs. All of these issues that we've talked about, about how we're moving in the right direction, those were all presented to the risk
00:58:08.65	Councilmember Hoffman	to prism.
00:58:09.68	Councilmember Hoffman	That's how we got insurance
00:58:12.28	Councilmember Hoffman	Period.
00:58:13.29	Councilmember Hoffman	Before that, we were going to be denied. So that's the floor.
00:58:16.92	Councilmember Hoffman	hopefully we keep moving in that direction, but that's,
00:58:20.73	Councilmember Hoffman	a risk if we
00:58:22.39	Councilmember Hoffman	If we say we don't know what's going to happen in the future, which we don't, then we're entering into more risky behavior if we don't appropriately address the unknowns. And that's what I believe our reserve policy should encompass,
00:58:37.62	Councilmember Hoffman	at this point until we know what our increased costs about are going to be with regard to our much higher
00:58:43.57	Councilmember Hoffman	deductibles, or if you want to call it
00:58:46.11	Councilmember Hoffman	are uninsured reserve policies, right? So those have quadrupled.
00:58:50.82	Councilmember Hoffman	So...
00:58:52.00	Councilmember Hoffman	That's my position on why I think that we should have
00:58:55.16	Councilmember Hoffman	a higher, we should entertain a higher reserve
00:58:59.01	Councilmember Hoffman	or if we want to call it something else above the reserve,
00:59:04.10	Councilmember Hoffman	that we just want to tie to insurance,
00:59:06.85	Councilmember Hoffman	for this year to see how we get through this year and how we end up
00:59:11.31	Councilmember Hoffman	after the six month assessment,
00:59:13.35	Councilmember Hoffman	from the insurance company. So we'll know that in six months, how we're doing,
00:59:18.95	Councilmember Hoffman	We'll know if our insurance is going to stay the same.
00:59:21.89	Councilmember Hoffman	whether it's gonna go down or whether or not it's gonna go up.
00:59:24.91	Councilmember Hoffman	So that's, I think, I think the time for not,
00:59:31.42	Councilmember Hoffman	addressing future risk.
00:59:34.21	Councilmember Hoffman	Um,
00:59:35.05	Councilmember Hoffman	has passed us.
00:59:36.40	Councilmember Hoffman	And we need to...
00:59:38.29	Councilmember Hoffman	engage in more, uh,
00:59:40.37	Councilmember Hoffman	conservative assessments, at least for the next year, until we find out on more solid ground where we're at.
00:59:46.64	Mr. City Clerk	Any other comments before we vote?
00:59:49.26	Mr. City Clerk	And, oh, Councilmember Bostein?
00:59:51.08	Councilmember Blustein	I'll just say I think all of us on the dais are very aware of and concerned with our risk and are taking steps and directing staff to take steps to decrease our risk. And just to reiterate the point that former Mayor Withey made, at any time, if we are deeply concerned about the direction that our budget is taking, we can make a change to our reserve policy. So I agree.
01:00:11.92	Councilmember Blustein	I appreciate the comments and the consideration of our of our reserve going forward and taking this very seriously and I think we are all thinking about it from a future standpoint and I really appreciate that Councilmember Kellman is asking for specific.
01:00:24.92	Councilmember Blustein	uh, measures for that. And I think we are, we all, I like to your point, Councilman Hoffman, I think we're all going to the same place with this. So, so I hope we can get there with our boats.
01:00:36.07	Mr. City Clerk	All right, so let's call the question. All in favor of the motion, say aye. Aye. Opposed?
01:00:40.00	Councilmember Hoffman	Bye.
01:00:42.14	Councilmember Hoffman	No, because I think we should have, I don't think we should have a 25%. I think we should have a 30% reserve.
01:00:47.17	Mr. City Clerk	Okay, so motion carries four to one moving on and thank you for the discussion and the action. Moving on to item to be adoption of fiscal year 2425 budget and allocated and funded positions who is giving the presentation, Mr. Director tests, the floor is yours.
01:01:05.43	Director Hess	That would be me. Thank you. Good evening, mayor, council, and members of the community.
01:01:10.21	Director Hess	Tonight, before you, we bring the fiscal 24-25 budget for the City of Sausalito.
01:01:16.45	Director Hess	The general fund budget includes $17,241,000
01:01:20.91	Director Hess	800.
01:01:22.02	Director Hess	and $82 in outside revenues from external sources.
01:01:26.49	Director Hess	It includes 20 million, 700,
01:01:29.02	Director Hess	709.
01:01:30.71	Director Hess	$5,566 worth of expenditures.
01:01:35.03	Director Hess	And it also includes net transfers,
01:01:37.38	Director Hess	from other funds.
01:01:39.03	Director Hess	in the amount of $2,450,000.
01:01:43.69	Director Hess	In addition to the aforementioned value, the city will balance our budget using 1 million,
01:01:49.07	Director Hess	$17,684 of unassigned fund balance.
01:01:53.27	Director Hess	in excess of reserves.
01:01:55.18	Director Hess	It is important to note that the general fund, as of the last external audit,
01:01:59.23	Director Hess	contained three million.
01:02:00.45	Director Hess	$134,000.
01:02:02.28	Director Hess	of reserves.
01:02:03.55	Director Hess	under the policy, the 15% policy.
01:02:06.71	Director Hess	and $7,747,600
01:02:10.84	Director Hess	in fund balance, in excess of reserves.
01:02:14.06	Director Hess	based on the action tonight,
01:02:15.36	Director Hess	of increasing the fund balance policy to 25%,
01:02:18.84	Director Hess	this increase in reserves of 2,092,000
01:02:22.65	Director Hess	$673 leaves the restated
01:02:25.99	Director Hess	balance of unassigned
01:02:28.12	Director Hess	or
01:02:29.47	Director Hess	leaves a restated balance of $5,227,338 of
01:02:37.89	Director Hess	now reserves at the 25% level.
01:02:41.45	Director Hess	That also leaves
01:02:42.53	Director Hess	$5,664,000 of fund balance
01:02:46.48	Director Hess	in excess of reserves.
01:02:48.62	Director Hess	It's also important to note that the general fund is projected to end the year, fiscal year 24,
01:02:53.84	Director Hess	in the black.
01:02:54.80	Director Hess	by over a half a million dollars, which will again add to our fund balance
01:02:58.80	Director Hess	and excess reserves.
01:03:01.36	Director Hess	As noted in previous discussions with council, our insurance challenges are the significant change over the prior year.
01:03:07.73	Director Hess	Tireless effort by staff to secure an opportunity to join PRISM was paramount in limiting the projected deficit
01:03:13.94	Director Hess	in this coming year.
01:03:15.74	Director Hess	premiums paid to prison over
01:03:18.05	Director Hess	Um,
01:03:19.01	Director Hess	over those paid to Bay Cities,
01:03:20.70	Director Hess	is roughly 170,000.
01:03:23.05	Director Hess	This significant increase for the budget
01:03:25.43	Director Hess	also comes from the SIR.
01:03:28.33	Director Hess	increasing tenfold
01:03:30.02	Director Hess	to a half a million dollars.
01:03:31.57	Director Hess	from the previous Bay Cities, $500,000,
01:03:34.81	Director Hess	before $50,000, I'm sorry, before
01:03:37.66	Director Hess	or expulsion.
01:03:39.10	Director Hess	or potential expulsion in October.
01:03:42.15	Director Hess	To account for this,
01:03:43.35	Director Hess	In the city's budget, we have budgeted $750,000.
01:03:47.92	Director Hess	I'll
01:03:48.95	Director Hess	SIR set aside for the general liability.
01:03:51.82	Director Hess	and $250,000 for workers' compensation,
01:03:54.89	Director Hess	that settle any future claims.
01:03:58.18	Director Hess	The SIR set aside is an estimate based on an analysis of historical data.
01:04:03.31	Director Hess	Actual performance of the city will vary.
01:04:05.71	Director Hess	We may spend very little of the FIR or we may spend most of it
01:04:09.94	Director Hess	and need to come back to council.
01:04:11.60	Director Hess	solely based on our experience of settling and defending claims.
01:04:16.24	Director Hess	also included in this year's budget,
01:04:18.20	Director Hess	We are funding a risk manager position under the finance department.
01:04:22.50	Director Hess	And again, to the degree that we manage our risk,
01:04:24.78	Director Hess	Really, the destiny is in our hands.
01:04:27.98	Director Hess	As discussed in our first budget meeting this year, we are not drawing funds out of the Section 115 trust.
01:04:33.99	Director Hess	based on council feedback.
01:04:36.00	Director Hess	However, because this trust is our worst performing asset that the city holds in its portfolio,
01:04:41.86	Director Hess	We are exploring other trust providers to better manage the city's pension and OPEB resources.
01:04:48.79	Director Hess	Also on the pension front, we will continue to work with CalPERS and continue to review the study.
01:04:54.75	Director Hess	by Barthels and Associates.
01:04:56.91	Director Hess	really examine the
01:04:58.93	Director Hess	other ways that we can help manage our pension UAL payment.
01:05:03.29	Director Hess	Discretionary payments may be an option. Realigning the layers within our UAL may be an option. But again, the goal is really to manage that $35 million pension obligation.
01:05:16.26	Director Hess	Now, our capital projects will continue on as planned.
01:05:19.25	Director Hess	These are funded.
01:05:20.89	Director Hess	by external or other resources outside of the general fund.
01:05:25.44	Director Hess	So in fiscal year 24, we had a planned budget of $4 million for capital as we do in fiscal year 25.
01:05:32.73	Director Hess	These again are primarily funded by Measure L sales tax revenue, which passed
01:05:36.97	Director Hess	And a couple of years ago,
01:05:38.40	Director Hess	the gas tax from the state.
01:05:40.34	Director Hess	County level sales tax measures for parks,
01:05:42.81	Director Hess	And wrote.
01:05:44.21	Director Hess	in addition to the dollars that are available in the Tidelands Fund that we can spend on special projects within that granted land zone.
01:05:51.36	Director Hess	With that, I would like to open it up for your questions and comments.
01:05:55.61	Mr. City Clerk	Questions for Director Hess, please. Who would like to go? Let's just pick the order now. Who wants to go first, second, third? We'll just go down the line. Who would like to go first? Anyone? No questions?
01:06:06.55	Mr. City Clerk	I did have one.
01:06:06.58	Unknown	I did have...
01:06:08.46	Unknown	a question.
01:06:09.40	Mr. City Clerk	Okay, Vice Mayor will be first, and if there are no other questions after that, we'll be doing it.
01:06:13.77	Unknown	Thank you.
01:06:14.13	Unknown	Um, always.
01:06:15.19	Mr. City Clerk	Thank you.
01:06:15.22	Unknown	Thank you.
01:06:15.85	Mr. City Clerk	All right, vice mayor.
01:06:17.40	Unknown	Thank you, Director Hess, for that presentation tonight. And thank you for all the work.
01:06:22.33	Unknown	you know, and all of the
01:06:24.25	Unknown	knowledge that you've imparted to us leading up to this evening.
01:06:28.10	Unknown	I looked with particular interest at the various department details in the budget and was pleased to see reductions this year over last year for several departments, but I was curious about
01:06:44.27	Unknown	The finance.
01:06:45.90	Unknown	It's on page 59 of our staff report. It shows 2024 adopted, 1,021,604.
01:06:53.16	Unknown	2025 adopted 1,148,598, and then 2025 change, zero.
01:07:00.25	Unknown	So I didn't understand how the change from 2024 to 2025 came out to zero when it looks to me as though we're spending slightly more in 2025.
01:07:11.32	Director Hess	Oh, I see that. So on...
01:07:14.52	Director Hess	Yeah, on page
01:07:16.40	Director Hess	19, if you're looking at that grand total, I have a formatting issue there.
01:07:21.61	Director Hess	Um,
01:07:22.35	Unknown	Grand total.
01:07:23.50	Director Hess	Yeah, yeah, I do have a formatting issue.
01:07:26.08	Director Hess	Um,
01:07:27.48	Director Hess	The salaries and benefits are increasing by 18%.
01:07:31.20	Director Hess	The professional services are holding stable.
01:07:33.56	Director Hess	and supplies and materials are increasing by 9%.
01:07:37.71	Director Hess	I can open up my budget workbook and give you that,
01:07:41.51	Director Hess	grand total percentage change, if something you'd like to see now, or I can update that in the budget book that we publish online.
01:07:49.07	Unknown	The other number that confused me was the telephone went up 900%.
01:07:54.68	Unknown	Um, uh,
01:07:55.53	Director Hess	Ah.
01:07:56.66	Director Hess	That is not correct.
01:07:56.71	Unknown	That.
01:07:58.35	Unknown	And you and I had had a conversation about greatly reducing our telephone cost.
01:08:02.95	Director Hess	That's, well, we just, yes, we just found another $1,100. Thank you.
01:08:08.95	Unknown	Yeah, so.
01:08:12.30	Unknown	Anyway, if you, I think it's important for the adopted budget that this detail be accurate. So you can...
01:08:18.72	Unknown	Yes.
01:08:21.41	Unknown	make the corrections to this
01:08:23.73	Director Hess	Thank you.
01:08:24.23	Unknown	Thank you.
01:08:24.25	Director Hess	um,
01:08:25.55	Director Hess	Now I can change the percentage, I can fix that formatting error,
01:08:29.84	Director Hess	I don't know if I can change that telephone expense now because everything is tied into our GAN limit that we need to approve this evening.
01:08:37.45	Director Hess	but I will make sure that that gets corrected in our mid-year budget.
01:08:40.53	Director Hess	Thank you.
01:08:40.55	Unknown	Okay.
01:08:40.70	Unknown	Thank you.
01:08:40.72	Unknown	Would that be an acceptable solution?
01:08:40.72	Director Hess	Would that be an acceptable solution?
01:08:45.75	Unknown	That was my initial question regarding this.
01:08:48.60	Mr. City Clerk	Councilmember Kelman?
01:08:50.98	Unknown	you
01:08:51.01	Councilmember Kelman	Sure. Thank you, Chad. I know this is no light lift. I have a
01:08:56.09	Councilmember Kelman	Small question and then a big question. I'll go with a small question. In our last council meeting attached to, I can't remember which agenda item, was a SWOT analysis from different departments. And I noticed that the community development department SWOT analysis had as a weakness that it was understaffed. And we talked a little bit about how you were projecting costs for different departments in terms of people who are in place today versus vacancies. I'm wondering if you could step us through that. Are we planning to hire? I mean, I know the director's here. Do we need to hire? Should we be thinking about hiring?
01:09:36.78	Councilmember Kelman	I don't know how to absorb that information in the context of this budget, but I saw that that was a weakness and I'd like to address it.
01:09:43.07	Director Hess	Yeah, so from a budgetary standpoint, I can tell you the methodology that we used to project that but from a staffing level requirement I would defer that to your director. Yes.
01:09:53.64	Unknown	the director
01:09:55.73	Director Hess	So in this budget, we did budget for all approved physicians.
01:10:00.64	Director Hess	We budgeted at full employment. Our goal is to fill all positions.
01:10:05.43	Director Hess	And we used a reasonable salary that is commensurate with where they are plus the next step and their COLA.
01:10:12.84	Director Hess	I did not budget at Top Step before.
01:10:15.62	Director Hess	But regarding if there is an additional position, there is no additional positions in this year's budget. But if a need for additional resources in that department is required or needed, I would defer that to Director Phipps.
01:10:29.43	Director Phipps	And thank you, Chad, for the opportunity to comment. So I'll respond to kind of the initial question and the statement that the department is understaffed. That SWAT was written on the heels of one of our planning staffers actually leaving the department. So we have at current one unfilled position in CDD. That is the position of was senior planner. We did an internal promotion from associate to senior planner
01:10:58.35	Director Phipps	which has now opened up the position of associate planner, which we are currently soliciting applications for. And my understanding, based on collaboration with our head of HR, and thank you, Kathy, for the work, that we've received an abundance of interest in the role. So that's point one. Second point is, CDD is shouldering a tremendous burden of taking on and becoming acquainted with
01:11:28.80	Director Phipps	the slew of state housing policies, which is a burden for a relatively small department. That comment of being understaffed is partly related to the burden associated with
01:11:42.77	Director Phipps	integrating those new housing policies into the way that we review
01:11:47.81	Director Phipps	I'd say new applications, but particularly in connection with new applications for residential projects.
01:11:55.12	Director Phipps	I will make the point that at Current we have a number of consultants that assist us in integrating those policies into our department and assist us with expert review.
01:12:06.58	Director Phipps	However, it's not certain that that support will be there forever. And I believe that as we conclude projects like the housing element, we will have less need for those consultants and there may be an opportunity to move from that consulting related expense into a staffing expense.
01:12:27.28	Councilmember Kelman	So Director Phipps, how should we be thinking about those added costs of consultants over the next year? Mm-hmm.
01:12:34.05	Director Phipps	Thank you for the question. My kind of quick response would be, I would not see that as an additional cost because any additional costs that we take on with staffing will be accounted for based on reduction in consulting costs. So that's something that we have accomplished, I will say, significantly in the last year in CDD. We used to spend over $100,000 a month on four leaf now we spend less than twenty thousand dollars a month on them so we've reduced that number CDD. We used to spend over $100,000 a month on Fourleaf. Now we spend less than $20,000 a month on them. So we've reduced that number significantly with in-house staffing. I believe we can do the same in this instance.
01:13:09.20	Councilmember Kelman	So like for DeNovo and others, do you want this council to consider additional allocations? Should we be mindful of that?
01:13:19.29	Director Phipps	I'd like to discuss that approach with city management and make sure that we're aligned and that my requests are aligned with the vision of city management and council. But I believe that that would be reasonable.
01:13:32.54	Councilmember Kelman	Okay, so we should have a conversation about that. That was the small question, Chad.
01:13:37.28	Councilmember Kelman	The larger question, thank you, Dr. Phipps.
01:13:39.48	Councilmember Kelman	You introduced this agenda item very quickly, talked about increased costs relating to pension UAL payments. And I'm hoping you could go back
01:13:49.36	Councilmember Kelman	and maybe more methodically step us through that.
01:13:52.72	Councilmember Kelman	And your game plan.
01:13:54.53	Director Hess	the pension.
01:13:55.51	Director Hess	Yes. So
01:13:58.60	Director Hess	There are a couple of ways that I think we can look at our pension debt. Um,
01:14:04.35	Director Hess	Last year when we went to the CalPERS educational forum, we sat down and met with our actuary
01:14:10.49	Director Hess	And we discussed various ways that we can work within our UAL payments, either by making a discretionary payment,
01:14:19.22	Director Hess	which we could target a specific layer and that reduces the overall interest costs that we would bear over the life of that, that unfunded layer.
01:14:27.81	Director Hess	Currently, we pay 6.8%
01:14:30.93	Director Hess	annually on our unfunded pension liability. That's the discount rate that helpers assigns.
01:14:36.33	Director Hess	Um,
01:14:37.00	Director Hess	In addition to that, we want to work with kelpers
01:14:40.51	Director Hess	and or Bartels to really focus on
01:14:43.79	Director Hess	when is the optimal time to spend down our Pension 115 Trust resources for pensions?
01:14:50.08	Director Hess	The goal is really to level out that peak of pension UAL payments when they start to rise
01:14:57.56	Director Hess	in early 2031, 32, kind of in that timeframe.
01:15:03.19	Director Hess	Pensions is a very complex
01:15:06.80	Director Hess	area of discussion and I think more more information is really
01:15:11.14	Director Hess	needing to be learned by myself, just learning more about the CalPERS system and how that works and how we can fund it.
01:15:17.38	Director Hess	So leveraging our resources at CalPERS is really a first step, I believe,
01:15:22.94	Director Hess	in undertaking
01:15:24.79	Director Hess	the management of that UAL payment in subsequent years.
01:15:31.04	Mr. City Clerk	Okay.
01:15:32.98	Mr. City Clerk	you
01:15:33.30	Mr. City Clerk	Can I add to that? Well, shut up.
01:15:33.95	Councilmember Kelman	Well,
01:15:36.08	Councilmember Kelman	Sure. It's very complicated, obviously. Marking conditions, interest rates, and such. But I think just maybe for the purposes of this conversation...
01:15:46.38	Councilmember Kelman	Your overall direction as to how we might account for this large long-term debt obligation would help us think strategically as to where our decisions tonight may fit into the next three to five years.
01:15:59.89	Babette McDougall	Okay.
01:16:01.77	Director Hess	As of
01:16:05.38	Director Hess	Pension UAL payments is really a moving target. As you said, it's really a factor of the interest rate
01:16:12.62	Director Hess	and the interest rate environment or the rate of return that CalPERS can
01:16:16.68	Director Hess	receive.
01:16:18.07	Director Hess	And there's always a two year lag between
01:16:21.12	Director Hess	when they close their fiscal year at 630.
01:16:24.12	Director Hess	and when they release the or the new UAL payments go into a
01:16:29.39	Director Hess	As it stands now, we know what our UAA payments will be for 2025.
01:16:34.57	Director Hess	in the 2026 payments,
01:16:37.30	Director Hess	on the new schedule is not yet released. So there's uncertainty there, but I know that it will increase in 2026 simply because CalPERS missed
01:16:45.93	Director Hess	their estimated rate of return last year.
01:16:49.89	Director Hess	Now, based upon the market conditions now,
01:16:52.96	Director Hess	CalPERS fiscal year ends in about five days.
01:16:56.05	Director Hess	And I believe that there's a pretty good chance that they will meet their investment return of 6.8%.
01:17:02.95	Director Hess	If that's the case, our UAL payment in 2027 will be decreased because they had better than expected performance.
01:17:12.05	Director Hess	in long-term planning of this,
01:17:14.29	Director Hess	Thank you.
01:17:14.35	Director Hess	You know, I think really being intentional about
01:17:18.11	Director Hess	knowing where those increased costs or those accelerating costs will start to impact the city's budget is paramount.
01:17:26.11	Director Hess	And also really looking at our city's finances in a longer period.
01:17:31.74	Director Hess	in a longer horizon, I think.
01:17:34.00	Director Hess	the 10-year plan that
01:17:35.79	Director Hess	Mayor Sobieski,
01:17:38.02	Director Hess	and Councilmember Hoffman and former Mayor Ray Withyar working on is going to be
01:17:44.15	Director Hess	a key part of this planning for the longterm.
01:17:47.52	Director Hess	It's.
01:17:48.47	Director Hess	It's taking a little longer than expected to prepare that plan simply because of our insurance issues that we
01:17:55.37	Director Hess	we came into this fiscal year.
01:17:58.51	Director Hess	But again, I think looking at our long-term plan is going to be important to manage that cost
01:18:03.32	Director Hess	and additional
01:18:04.82	Director Hess	Education on my part, I think, is required to really manage that
01:18:09.04	Director Hess	as effectively as possible.
01:18:12.26	Director Hess	So I don't have all of the answers on that pension debt at this point.
01:18:16.97	Director Hess	Thank you.
01:18:17.59	Director Hess	Thank you.
01:18:17.61	Mr. City Clerk	Unfortunately.
01:18:18.67	Councilmember Blustein	Thank you.
01:18:18.69	Councilmember Kelman	Okay.
01:18:19.03	Councilmember Blustein	Thank you.
01:18:19.23	Councilmember Blustein	Thank you.
01:18:19.26	Councilmember Kelman	Thank you.
01:18:19.53	Councilmember Blustein	chapter.
01:18:19.99	Mr. City Clerk	Council member of Lasting, when did he be recognized?
01:18:22.27	Councilmember Blustein	Thank you.
01:18:22.98	Councilmember Blustein	So you asked director Phipps about staffing so it brought me up so Chad you and I had a conversation today and we talked a little bit about the structure of the budget. And that this year's budget is designed a little differently than last year's in terms of how we look at staffing, so I just wanted to ask a couple of questions about that so this year's budget you.
01:18:40.91	Unknown	That's correct.
01:18:44.47	Councilmember Blustein	did not budget for top step for every employee.
01:18:47.85	Councilmember Hoffman	Thank you.
01:18:47.88	Director Hess	That is correct.
01:18:48.17	Councilmember Hoffman	I'm sorry.
01:18:48.25	Director Hess	Correct.
01:18:48.39	Councilmember Hoffman	Thank you.
01:18:48.88	Councilmember Blustein	Okay, so how did you budget?
01:18:50.62	Director Hess	I budgeted at where they are at today.
01:18:53.76	Director Hess	Plus the next step that they would be eligible for at their anniversary.
01:18:57.35	Director Hess	and then the COLA, the cost of living adjustment that was approved,
01:19:01.33	Director Hess	this year.
01:19:03.00	Director Hess	So basically I took a more realistic approach at what is our labor costs going to be.
01:19:09.23	Director Hess	Whereas last year we, we,
01:19:11.29	Director Hess	overstated our
01:19:14.23	Director Hess	our labor costs simply because we were overestimating what that cost would be per individual.
01:19:19.69	Director Hess	So we're still at full staffing.
01:19:21.68	Director Hess	but we're,
01:19:22.43	Director Hess	we're cutting back on where people are.
01:19:25.41	Director Hess	I know that I'm not at top step. I know my team is not at top step and there are others within the city staff that are not at top step. So it wasn't a realistic
01:19:34.95	Director Hess	expectation of
01:19:36.74	Director Hess	through labor costs.
01:19:37.93	Director Hess	for fiscal year 24.
01:19:39.79	Director Hess	25 will be much closer.
01:19:39.81	Councilmember Blustein	$25.
01:19:41.73	Councilmember Blustein	But you did budget for full staff.
01:19:44.08	Director Hess	Full staff, yes. Our intention is to fill every available position to provide exceptional service to the community.
01:19:50.52	Councilmember Blustein	Okay, then I have a couple of questions for Director Kathy Nikitas just about where our employees fall and how common or not raises are just to make sure we're being smart about these projections and we can consider them realistic. So I would love to understand how many employees now do we have at Full Step?
01:20:02.03	Miss McDougal	Thank you.
01:20:02.06	Kathy Nikitas	So-
01:20:02.27	Miss McDougal	Thank you.
01:20:07.94	Kathy Nikitas	So of our full-time employees, we have 79 positions. We have 67 of them filled.
01:20:13.96	Kathy Nikitas	And 17 of those 67 people are at top step.
01:20:19.78	Kathy Nikitas	And a little over, let's see, nine of them have been working for the city for 15 plus years, some up to 29 years.
01:20:28.42	Councilmember Blustein	in order to achieve full step. Exactly. And how long does it typically take to get to full step?
01:20:33.17	Kathy Nikitas	It depends. The grades have seven steps, the hourly positions. And so sometimes people come in higher than step one. Otherwise, it would take them seven years.
01:20:46.35	Councilmember Blustein	Okay, and right now of those 67 filled positions,
01:20:50.58	Kathy Nikitas	Mm-hmm.
01:20:50.90	Councilmember Blustein	Thank you.
01:20:50.95	Councilmember Blustein	Are there anyone, is there anyone expected to achieve full step by the end of the year? And how many roughly?
01:20:56.60	Kathy Nikitas	Hmm. She's the steps. Sorry. People know, but I didn't really want to enjoy.
01:20:59.07	Councilmember Blustein	Sorry if the people know it.
01:21:00.81	Councilmember Blustein	I just really want to ensure that Director Hess's modeling is based on the realistic outcome for or outlook of our staff, which I believe it is, but I would love to hear that reinforced.
01:21:01.60	Unknown	Thank you.
01:21:11.59	Kathy Nikitas	Yes, most definitely. He is looking at where people actually are. And if someone is slated to go, they have their anniversary coming up in say October, and they're at a step six, he's budgeted them starting at going to a step seven in October. So looking at the reality. So
01:21:27.01	Councilmember Blustein	So, Director Haas, in fact, you've already budgeted for everyone, whether or not they will based on assessment to advance the steps. So, you are being...
01:21:34.17	Councilmember Blustein	Thank you.
01:21:34.22	Councilmember Blustein	Correct.
01:21:34.27	Director Hess	Correct.
01:21:35.00	Councilmember Blustein	quite conservative in terms of what our pay is now. You're just not going to full steps.
01:21:39.38	Director Hess	Yeah, correct. So if somebody's at step five, I'm assuming they're going to hit step six during the fiscal year.
01:21:44.29	Director Hess	And then I'm adjusting that range because of the 2% COLA for SEIU.
01:21:44.40	Councilmember Blustein	Okay.
01:21:49.37	Councilmember Blustein	And Kathy has someone ever jumped from say step three to step seven in one year?
01:21:54.55	Kathy Nikitas	There have been a couple of occasions that has happened, and it's usually been made up by other savings if, say, a position has been vacant for a certain amount of time. So it doesn't happen very often, but there have been a couple of instances.
01:22:09.39	Councilmember Blustein	But based on your productions, Director Hess, there's some room for step for each employee to do that.
01:22:14.97	Councilmember Blustein	and not every employee will get a step up necessarily.
01:22:21.01	Councilmember Blustein	And at this time, oh, sorry, go ahead, Director.
01:22:22.69	Councilmember Hoffman	Go ahead. No.
01:22:24.20	Councilmember Hoffman	Oh, I'll differ.
01:22:25.33	Councilmember Blustein	And you've also budgeted for a full workforce. So for every position filled, correct?
01:22:30.02	Director Hess	Yes, yes. Every position filled, even our risk manager that we don't currently have.
01:22:32.81	Councilmember Blustein	Yeah.
01:22:33.81	Councilmember Blustein	I really have.
01:22:34.63	Councilmember Blustein	And so we have 67 now of 79. Kathy, have we ever filled every position in your time here or in the last several years?
01:22:41.25	Kathy Nikitas	Certainly not in my time, and I haven't seen it in the last several years.
01:22:45.67	Councilmember Blustein	Okay, so we also still have significant cushion from the unfilled positions.
01:22:50.56	Unknown	Correct.
01:22:51.54	Kathy Nikitas	We have two positions that are frozen, as far as I know, for budgeting. So they exist on our approved plan, but they're not being funded currently.
01:23:01.51	Councilmember Blustein	Okay, but there's being budgeted for out of an abundance of conservative view for what could happen.
01:23:06.71	Director Hess	Say that one more time.
01:23:07.69	Councilmember Blustein	still being they're still included in your projections for the
01:23:09.90	Director Hess	Those two that are frozen in the PD are not funded because there's no intention to fill those.
01:23:15.89	Councilmember Blustein	But 77 of the 69 are budgeted, even though we're only currently employing 69 of those 77.
01:23:15.93	Director Hess	At this point.
01:23:22.27	Councilmember Hoffman	That is correct.
01:23:23.33	Councilmember Blustein	67 of the, okay. Okay, great. So that would leave several hundred thousand dollars in cushion.
01:23:28.77	Councilmember Hoffman	Yes. In the event of
01:23:29.54	Councilmember Blustein	In the event of one of our employees from step three jumped to step seven, we would still have significant, likely to have significant coverage for that. Okay, great. Just wanted to make sure we were being smart about our budgeting. Thank you. Absolutely.
01:23:38.40	Mr. City Clerk	I just wanted to make sure.
01:23:40.82	Mr. City Clerk	Thank you.
01:23:40.83	Councilmember Hoffman	Thank you.
01:23:40.87	Mr. City Clerk	You're welcome.
01:23:44.68	Councilmember Hoffman	So I'll just follow up on that line of questioning from Councilmember Blaustein. So you and I have discussed this. We actually discussed this in our at length in our 10 year modeling group as well about how we want to budget for employees in our budget.
01:23:59.58	Councilmember Hoffman	There's a there's a policy discussion behind that. And so Councilmember Blassing has gone through
01:24:04.80	Councilmember Hoffman	why you believe that the current and past policy of budgeting for a full staff at full
01:24:12.00	Councilmember Hoffman	at Full Step.
01:24:13.18	Councilmember Hoffman	You believe that's not. Anyway, you have decided to budget in a different way. And that's resulted in a different number in our
01:24:24.56	Councilmember Hoffman	in our budget,
01:24:26.21	Councilmember Hoffman	under that employee cost line,
01:24:28.56	Councilmember Hoffman	that's different.
01:24:29.64	Councilmember Hoffman	and below what would have been budgeted had we used the prior method, correct?
01:24:36.01	Director Hess	Yes, you're referring to the discussion that we had last week where you were asking about the change in salaries from the table code $400,000.
01:24:44.76	Director Hess	And I had that note disclosure down below that said, based upon the change in the budget methodology,
01:24:50.38	Director Hess	actual wages are increasing faster or more than that 400,000.
01:24:55.05	Unknown	Thank you.
01:24:55.08	Councilmember Hoffman	Right.
01:24:55.20	Director Hess	The goal of this change was to give you a more realistic budget.
01:24:55.22	Councilmember Hoffman	Right.
01:25:01.16	Councilmember Hoffman	Sure. I,
01:25:03.50	Councilmember Hoffman	But there's actually two issues with this, I think.
01:25:07.30	Councilmember Hoffman	the policy issue that I think
01:25:09.02	Councilmember Hoffman	should be a council decision about how we're going to, how we're going to budget. Are we going to budget
01:25:13.17	Councilmember Hoffman	in the prior method, which was
01:25:15.06	Councilmember Hoffman	Um,
01:25:15.70	Councilmember Hoffman	full employees at full step, or are we going to go with a different method that's going to result in a different number for our employee costs? That's,
01:25:24.95	Councilmember Hoffman	That's one issue.
01:25:26.22	Councilmember Hoffman	A separate and distinct issue is how are we reporting the costs
01:25:31.19	Councilmember Hoffman	from last year to this year in our budget.
01:25:34.33	Councilmember Hoffman	And so
01:25:35.75	Councilmember Hoffman	And that was our discussion last week, and it's set forth. It's nowhere in our staff reports tonight, and we don't have any written presentations tonight, correct? Correct.
01:25:45.59	Unknown	No.
01:25:46.64	Councilmember Hoffman	So it's not in our staff reports tonight, but it's slide 19 of the,
01:25:51.90	Councilmember Hoffman	the presentation that's now attached to the agenda for last week,
01:25:55.19	Councilmember Hoffman	And that talks about
01:25:57.17	Councilmember Hoffman	no matter what methodology you use, if you use a consistent methodology between the two years, in other words, if you use the old methodology, which was,
01:26:06.46	Councilmember Hoffman	full staff at full pay at full step, or if you use the current methodology,
01:26:13.18	Councilmember Hoffman	which is your reduced methodology, if you apply those consistently between the two years,
01:26:19.19	Councilmember Hoffman	the increased cost is a million dollars. You still agree with that?
01:26:22.36	Director Hess	Thank you.
01:26:23.03	Councilmember Hoffman	Thank you.
01:26:23.05	Director Hess	Yes, yes. It's more than what you're showing because of that change in methodology. My goal is to give you a more realistic budget.
01:26:31.07	Director Hess	instead of overflating expenses
01:26:33.30	Director Hess	simply because.
01:26:35.45	Councilmember Hoffman	Well, it doesn't matter because if you use the new methodology that you came up with,
01:26:41.31	Councilmember Hoffman	If you use that last year,
01:26:43.35	Councilmember Hoffman	for 2023.
01:26:44.82	Councilmember Hoffman	and you're applying it this year at 2024,
01:26:48.47	Councilmember Hoffman	consistent methodology
01:26:51.45	Councilmember Hoffman	results in
01:26:52.58	Councilmember Hoffman	a million dollar increased costs in staff, correct?
01:26:55.47	Councilmember Hoffman	That is correct.
01:26:57.21	Councilmember Hoffman	Actual cost.
01:26:57.22	Councilmember Hoffman	Absolutely.
01:26:58.14	Councilmember Hoffman	And that's not reflected in the budget currently.
01:27:00.55	Councilmember Hoffman	it is reflected in the budget.
01:27:01.81	Director Hess	Thank you.
01:27:02.19	Councilmember Hoffman	It is that a million dollar increase in employee cost.
01:27:05.54	Director Hess	It's there. Everybody is going to be paid at their rate plus the step.
01:27:10.94	Director Hess	So the actual cost will come in higher than
01:27:14.71	Director Hess	fiscal year 24's actual labor costs.
01:27:18.03	Councilmember Hoffman	So where is that, where is the million dollar increase in the staff costs reflected in the current budget? It's set forth on slide 19 that that's the outcome if you use consistent methodology.
01:27:28.66	Councilmember Hoffman	But I don't believe that it's currently in the current budget book that we have now.
01:27:33.77	Director Hess	I guess I'm not sure what you want me to show in this. My goal is to give you a reasonable, accurate budget.
01:27:42.65	Director Hess	I mean, I could overinflate all of our professional services. I could overinflate all of our supplies and materials.
01:27:48.46	Director Hess	and we could have a horrible budget and it could show
01:27:51.11	Director Hess	massive deficit.
01:27:52.69	Director Hess	but that doesn't give us any value to make decisions.
01:27:55.22	Councilmember Hoffman	Okay.
01:27:55.76	Director Hess	At the end of the day, my goal is to give you accurate information.
01:28:00.19	Director Hess	that is reflective of
01:28:01.87	Director Hess	current reality.
01:28:03.56	Councilmember Hoffman	Well,
01:28:05.20	Councilmember Hoffman	That's not what I'm asking.
01:28:07.04	Councilmember Hoffman	My point is that if you used your new methodology
01:28:12.30	Councilmember Hoffman	for the same staff analysis from 23, you still have a million dollar
01:28:19.74	Councilmember Hoffman	cost, increased costs for the staff.
01:28:22.95	Councilmember Hoffman	So it's not overinflated. If you go back and use your same methodology for 23, that your new methodology, the new accurate methodology that you used for 24,
01:28:33.78	Councilmember Hoffman	The increase in staff cost is the same. It's a million dollars. So the decrease in the staff cost between the two years is because you changed the methodology.
01:28:42.31	Councilmember Hoffman	Correct.
01:28:43.27	Director Hess	Yes, I did change the methodology in effort to give you a better budget.
01:28:55.74	Councilmember Kelman	Can I express my confusion about this? So, sorry, thank you, Director. So, by better budget, do you mean...
01:28:57.12	City Manager	confusion about this.
01:29:02.94	Councilmember Kelman	you're trying to, you change the methodology so it'll be balanced or- No. Right. So you're saying it's all accounted for. You just-
01:29:05.69	Director Hess	No.
01:29:08.98	Director Hess	all accounted for.
01:29:09.64	Councilmember Kelman	this year.
01:29:10.16	Director Hess	Thank you.
01:29:10.20	Councilmember Kelman	Thank you.
01:29:10.22	Director Hess	Thank you.
01:29:10.91	Director Hess	Correct. I'm trying to give you a more accurate
01:29:14.30	Director Hess	budget.
01:29:15.30	Director Hess	So if we redid last year's budget,
01:29:18.23	Director Hess	fiscal year 24 with the current methodology that I use for fiscal year 25.
01:29:22.82	Director Hess	it would show less expenses for salaries and a higher surplus.
01:29:28.04	Director Hess	Conversely, if I did the budget for 25,
01:29:31.51	Director Hess	The way I did it in 24, you would show higher labor costs.
01:29:35.31	Director Hess	and a substantially higher deficit.
01:29:38.43	Director Hess	It's, it's,
01:29:39.24	Director Hess	The goal is to give you a more accurate reflection of what we're going to experience during the year.
01:29:45.42	Director Hess	If I over inflate expenses, it doesn't give us accurate information to make decisions on.
01:29:51.69	Director Hess	So my goal is to give you a better budget.
01:29:54.65	Director Hess	by giving you more accurate or precise
01:29:58.12	Director Hess	projections.
01:29:58.98	Councilmember Kelman	So, sorry, I feel very lost on this topic now. So then, does that mean that last year...
01:30:05.41	Councilmember Kelman	It was.
01:30:06.53	Councilmember Kelman	somehow overinflated
01:30:08.44	Director Hess	Yeah, yeah, the wages was overinflated last year because I, we budgeted everybody's going to be paid the top dollar.
01:30:17.21	Director Hess	And
01:30:18.07	Director Hess	As Kathy just stated, there are 17 people that are paid top dollar.
01:30:22.20	Director Hess	The rest are paid at a lower step.
01:30:24.74	Director Hess	than that. So there was,
01:30:26.32	Director Hess	substantial budgetary slack.
01:30:28.48	Director Hess	in last year's budget.
01:30:30.35	Director Hess	That is being consumed up this year because I'm being more precise with my projections.
01:30:30.57	Councilmember Hoffman	That's...
01:30:30.85	Mr. City Clerk	that.
01:30:30.91	Councilmember Hoffman	Thank you.
01:30:30.93	Mr. City Clerk	Thank you.
01:30:35.94	Mr. City Clerk	So Councilmember Blaustein, then Vice Mayor.
01:30:38.42	Mr. City Clerk	Go ahead.
01:30:39.01	Councilmember Blustein	So just quickly, Chad, just to kind of clarify and make clear. So let's assume, I don't know that these are the numbers I'm making them up just for the sake of clarification. If everyone was paid at stop top step last year, it was an extra million dollars in the budget, but in this assumption, everyone is paid going up a step still at full staffing. So it's more like.
01:30:57.32	Councilmember Blustein	$500,000 less or whatever. So this is that cost.
01:31:00.36	Unknown	Thank you.
01:31:00.41	Unknown	Yeah, yeah.
01:31:00.58	Councilmember Blustein	Yeah.
01:31:00.73	Councilmember Blustein	Actually, if you look at our black this year and also where we made changes, that was because of the slack and salary, correct? You've mentioned that a lot throughout the budget.
01:31:00.97	Councilmember Hoffman	Thank you.
01:31:08.95	Director Hess	But yeah.
01:31:09.76	Director Hess	Yep, yep. I'm reducing the budgetary slack.
01:31:12.88	Director Hess	Right. Is all I'm doing.
01:31:12.91	Councilmember Blustein	Right.
01:31:13.22	Unknown	I don't know.
01:31:13.93	Director Hess	Thank you.
01:31:13.94	Councilmember Blustein	Right.
01:31:14.03	Unknown	Right.
01:31:14.30	Director Hess	I'm trying to be more accurate.
01:31:14.72	Unknown	I'm trying to
01:31:16.54	Unknown	Thank you.
01:31:18.92	Unknown	And Chad, one or two meetings ago, I actually had requested that you,
01:31:24.95	Unknown	provide us a budget based on the total number of employees we have, 67 versus 79.
01:31:32.29	Unknown	Instead, you gave us a budget. You explained to us at our last meeting that you were giving us a budget with 79 FTEs, even though we only currently employ 67, but you were going to adjust the salaries down instead of top step to reflect actual salaries.
01:31:50.48	Unknown	Right?
01:31:52.30	Unknown	So
01:31:52.81	Director Hess	Thank you.
01:31:54.68	Unknown	you
01:31:54.70	Director Hess	Can you repeat that? I'm not sure I followed.
01:31:57.78	Unknown	Two meetings ago, I asked that we see what we would actually be spending based on our 67%
01:32:06.05	Unknown	currently filled positions versus budgeting for 79 positions.
01:32:07.54	Unknown	Okay.
01:32:10.90	Unknown	FTEs, which we are not likely to ever meet, according to our human resources director.
01:32:14.81	Sergio	Thank you.
01:32:17.07	Sergio	Yep.
01:32:17.38	Unknown	Instead of doing that, you more accurately said, I'm going to keep the 79 since it's our goal to have full employment, but I'm going to adjust the salaries to reflect actuality as opposed to top step for every position.
01:32:33.73	Unknown	Correct?
01:32:34.39	Councilmember Hoffman	Yes, that's correct.
01:32:35.64	Unknown	And you explained that to us at our last meeting.
01:32:38.52	Councilmember Hoffman	That is correct.
01:32:39.53	Unknown	My presentation.
01:32:40.93	Councilmember Hoffman	Yes.
01:32:41.71	Councilmember Hoffman	Yes, I did.
01:32:43.58	Unknown	And the reason that we have a million dollars increased salary expense, if you compare 79 FTEs last year at Top Step to 79 FTEs this year at Top Step, is that four out of five council members this year approved increased salaries across the board for our various employment units. Isn't that right?
01:33:10.53	Councilmember Hoffman	That is correct.
01:33:11.55	Unknown	And we did that based on a four out of five vote in order to increase retention beyond the dismal retention rates that we had previously been experiencing to bring our salaries up to the mid range for our county so that we could actually hold on to some of our employees and maintain institutional knowledge rather than having such high turnover. Isn't that right?
01:33:35.69	Councilmember Hoffman	That is correct, Councilmember.
01:33:36.96	Unknown	All right. I just wanted to clarify the record. Thank you.
01:33:40.72	Mr. City Clerk	Okay, any last questions before you can have some member hop?
01:33:42.56	Unknown	I'm so,
01:33:43.17	Unknown	Thank you.
01:33:43.19	Councilmember Hoffman	Yeah. So I think, as I said, we were talking about two different policy decisions about how we budget.
01:33:51.59	Councilmember Hoffman	a
01:33:52.62	Councilmember Hoffman	you know, one one issue is, are we going to change the policy and I think it appears that we're going to change the policy. But there are, you know, there are valid reasons to do it the old way, and that is to budget so that you have the flexibility to have a full staff everybody at top step. We have done that in the past we in department, we raised everybody up to a top step as a.
01:34:17.38	Councilmember Hoffman	as a salary measure in, I think it was 2023, as a retention measure in 2023. So luckily we had that flexibility.
01:34:30.55	Councilmember Hoffman	But let me go back to the point of
01:34:34.39	Councilmember Hoffman	I want to make sure that this is clear, that you have changed the methodology and we've changed the methodology now for how we budget for staff starting this year.
01:34:45.59	Councilmember Hoffman	If you go back and use that same methodology for last year,
01:34:46.13	City Manager	Yeah.
01:34:50.67	Councilmember Hoffman	and compare the two years. So I think I said 2023, 2024, but it was the budget year, right? So last year was 23, this year's, sorry. 24. This year's 25.
01:35:01.13	Unknown	24.
01:35:03.26	Unknown	Yep.
01:35:03.56	Councilmember Hoffman	So if you go back last year and apply your new and improved methodology, you still have a million dollars in increased costs, correct?
01:35:11.34	Councilmember Hoffman	Thank you.
01:35:11.36	Director Hess	Yeah.
01:35:11.58	Councilmember Hoffman	All right.
01:35:11.71	Director Hess	Thank you.
01:35:12.20	Director Hess	Yeah.
01:35:13.28	Director Hess	an actual cost.
01:35:14.45	Director Hess	When we issue that audit report,
01:35:14.48	Councilmember Blustein	you.
01:35:14.55	Councilmember Hoffman	What do we get?
01:35:16.89	Director Hess	we will have increased costs for wages.
01:35:19.95	Councilmember Blustein	Okay, thank you. Just a clarification point for the record for Kathy. We don't have, we've never had, or maybe for the city manager, I don't believe we've ever had a time where we voted for every employee to be a top step. That was not part of our, was that part of our 2023?
01:35:31.51	Councilmember Hoffman	I didn't say every employee said every employee in a certain department.
01:35:35.27	City Manager	When you adopted the budgets in the-
01:35:37.58	Councilmember Hoffman	time.
01:35:38.04	Councilmember Blustein	I'm aware that I voted for raises for employees, probably. Everybody up to the top.
01:35:40.96	Mr. City Clerk	Okay, let's stay focused on questions. City Manager, do you have a comment before we take public comment?
01:35:44.97	City Manager	No, I think I can answer the question. I think it's been said again and again, the practice of Sausalito was to budget for full employment at top step.
01:35:54.96	Mr. City Clerk	Okay.
01:35:55.87	Mr. City Clerk	City clerk, could you kindly... Hold on.
01:35:57.70	Councilmember Hoffman	Hold on, I have a follow-up question based on that.
01:36:00.21	Councilmember Hoffman	Because there's an intimation that we didn't do that.
01:36:03.13	Councilmember Hoffman	In a past year, I think it was 2023, we brought everybody in a certain department up to a top step.
01:36:12.66	Mr. City Clerk	I guess I will ask you a question. Director Hess.
01:36:15.95	Gregory Taylor	Thank you.
01:36:17.15	Mr. City Clerk	When you compare actual expenses from the previous fiscal year to your budgeted expenses for that fiscal year, would it be more accurate to use your new methodology of...
01:36:26.52	City Manager	We did.
01:36:32.69	Mr. City Clerk	I want to characterize it for the methodology of top step full employment. Which one's more accurate?
01:36:32.98	Councilmember Hoffman	I don't want to carry on.
01:36:33.51	City Manager	Thank you.
01:36:33.54	City Manager	Thank you.
01:36:33.56	Councilmember Hoffman	Sure.
01:36:33.66	Director Hess	Yes.
01:36:37.96	Director Hess	the full employment
01:36:39.94	Director Hess	reasonable wage.
01:36:41.13	Director Hess	Non-top-stop.
01:36:43.63	Councilmember Hoffman	Thank you, Mayor. Thank you, but that wasn't my question, and I would like for an answer to that question.
01:36:44.15	Director Hess	Yeah.
01:36:44.36	Mr. City Clerk	I'm not.
01:36:48.42	Mr. City Clerk	Oh, city manager.
01:36:50.92	Mr. City Clerk	Sorry, I didn't know. I apologize to you. See, manager, I'm sorry. I stepped on council member Hoffman's question. She wanted an answer to your question.
01:36:57.06	City Manager	There has never been a direction by the council to fund every single person in a department at top step.
01:37:03.20	City Manager	Thank you.
01:37:03.53	City Manager	Thank you.
01:37:03.56	Councilmember Hoffman	Okay, that's not my question.
01:37:04.45	City Manager	Okay, what's your question?
01:37:05.85	Councilmember Hoffman	My question is, it's true that in 2023, we raised everybody in a certain department up to top step.
01:37:13.99	City Manager	We provided increase in the police department, which brought many of them to top step, but the direction was never given. The bonus that was provided, the agreement that was adopted provided that some of that happened, but there was no direction that everybody in a department get top step ever.
01:37:32.74	Councilmember Hoffman	So,
01:37:35.28	Councilmember Hoffman	how would you describe what happened then in that year? Because my recollection was everybody that was, I believe, that had a step. It wasn't everybody. Sorry. You're right. Let me rephrase that. Everybody that had a step. So the management, I don't believe have step increases. It's the, the, um,
01:37:54.89	City Manager	the whatever it's called. Yeah, that's correct. So at that particular time, we were hemorrhaging officers. We were looking to stay competitive. So we took a step and the manager had the authority to do that to take the line level patrolman to top step, but not the entire department.
01:37:55.62	Councilmember Hoffman	Whatever it's called.
01:38:02.30	Councilmember Hoffman	Mm-hmm.
01:38:09.54	Councilmember Hoffman	Right. Sorry. Thank you for that. I appreciate that clarification. Thank you for that. But we had the luxury and the ability to do that because that's the way we had budgeted.
01:38:18.37	City Manager	Correct, and that was within the city manager's authority as well.
01:38:21.20	Councilmember Hoffman	Okay, thanks.
01:38:23.07	City Manager	City Clerk, would you kindly open up public comment?
01:38:24.97	Mr. City Clerk	Thank you.
01:38:25.61	Babette McDougall	by Bet MacDill, the owner, what?
01:38:34.97	Miss McDougal	Right.
01:38:35.95	Miss McDougal	Don't you just love getting down to the nitty gritty?
01:38:38.89	Miss McDougal	I do. They always say the devil is in the details. So this has been a very vigorous discussion. And I really want to thank each and every one of you for staying on.
01:38:50.56	Miss McDougal	important, subtle, but important different aspects of why we have to have full transparency in
01:38:57.90	Miss McDougal	of what it takes to run this city.
01:39:01.03	Miss McDougal	And with the here and nows,
01:39:03.31	Miss McDougal	that we talk about to some extent, but also the things that we try to plan ahead for, because we know they're going to happen. We just walk into our own futures. So I want to thank you for all of that. I just want to ask one thing, and that is, there needs to be a written, there's so many written policies, like whatever happened with negotiating the real property portfolio, speaking of the current budget year,
01:39:25.33	Miss McDougal	that we still don't know where we stand. So it's hard to go forward without knowing where we stand. I'm going to raise that again. So, all right. So then now looking at the employee situation...
01:39:35.76	Miss McDougal	On the one hand, I hear our director of finance, who generally I have a lot of trust in this man. So if he says we need to tighten the screws up a little, I believe him.
01:39:44.65	Miss McDougal	On the other hand, if we're using a policy that has been heretofore understood,
01:39:50.37	Miss McDougal	and managed against, then we need to understand...
01:39:53.74	Miss McDougal	Subtle, however they may be, changes still they are.
01:39:57.64	Miss McDougal	And if there are these changes in light of the need to be transparent and openly clear to those of us that are not that smart with numbers, just to be as clear as possible. So I want to thank.
01:40:09.42	Miss McDougal	Councilmember Hoffman for delivering on the point. I want to thank Ms. Blaustein for trying to break down the barriers to bring subtle common bound.
01:40:18.48	Miss McDougal	to make this discussion move a little better. And I always appreciate what Ms. Kelman has to say because she thinks outside the box in a very smart way, and I like to listen to Ms. Cox come right down like a train on a track. So thank you, Mayor. You've got quite a lineup here.
01:40:37.33	Unknown	Right.
01:40:37.70	Babette McDougall	Uh,
01:40:37.74	Unknown	Yes.
01:40:37.97	Mr. City Clerk	Bye.
01:40:38.09	Unknown	Thank you.
01:40:38.77	Mr. City Clerk	Mr. Withy here is walking up to the podium.
01:40:43.29	Unknown	Thank you. I just want to make one comment on this salary stuff before I actually make my main comment. The comment is between.
01:40:55.88	Unknown	2012 and 2020.
01:40:59.79	Unknown	We budgeted salaries in the way Chad is budgeting for this budget.
01:41:07.20	Unknown	I can't speak to what happened in 22 or 23. I wasn't here. So let's just be clear. We always budgeted at full number of staff at their actual staffing wages. So that's how it was done. And so Chad is just going back to how it was done for eight years, at least in my experience.
01:41:32.09	Unknown	So very briefly, what I wanted to say
01:41:35.16	Unknown	Pass this budget.
01:41:37.71	Unknown	But I used to joke when I was running teams, and I've even joked from the dais, that there
01:41:47.62	Unknown	Congratulations on passing the budget.
01:41:50.55	Unknown	Next year's budget in process starts tomorrow.
01:41:56.14	Unknown	And that means there's a lot of work that needs to be done between now and
01:42:01.39	Unknown	and January mid-year budget and to bring some of these issues together. I think it's very important that you don't get to January and then suddenly say, oh, whoops, we don't have this information or we don't have that information. Well, that will have to punt to next year. So I would really strongly urge us to make sure that you know what information you want.
01:42:26.85	Unknown	How to use the pension trusts, for instance, is an example. Council Member Kelman, your questions about that are quite right.
01:42:34.85	Unknown	The final thing I want to make is...
01:42:38.71	Unknown	I read the SWOT analysis. I read the turnover report. I'm running out of time.
01:42:43.86	Unknown	But
01:42:44.74	Unknown	It's really important to recognize that our staff is overworked.
01:42:47.39	Unknown	Sure.
01:42:52.62	Unknown	There's not enough of them. Thank you, sir. And you need to act accordingly. Thank you.
01:43:00.84	Unknown	Sir?
01:43:00.99	Unknown	Thank you.
01:43:05.04	Gregory Taylor	So,
01:43:05.11	Mr. City Clerk	Uh,
01:43:05.51	Gregory Taylor	I...
01:43:06.93	Gregory Taylor	piece of paper.
01:43:07.86	Mr. City Clerk	Would that make you happy? You can just introduce yourself.
01:43:07.94	Gregory Taylor	I think-
01:43:10.79	Mr. City Clerk	You have two minutes.
01:43:10.91	Gregory Taylor	Oh, thank you.
01:43:12.08	Gregory Taylor	So Gregory Taylor.
01:43:15.57	Gregory Taylor	Let me give you a little history lesson. Some of you don't look old enough to really remember some of the names you might hear me say. Before I begin that, I want to say the devil in the details. I haven't heard that mentioned in this room for...
01:43:27.89	Gregory Taylor	Quite a number of years. Some of you might be old enough to remember Amy Belzer.
01:43:33.78	Gregory Taylor	who came before Sandra Bushmaker.
01:43:37.22	Gregory Taylor	She had two sayings she was always famous for saying.
01:43:41.49	Gregory Taylor	The devil's in the details. You know, we all, those of you who don't know who I'm talking, we all loved Amy Belzer.
01:43:48.10	Gregory Taylor	including myself.
01:43:49.81	Gregory Taylor	She would say, the devil's in the details. And her other...
01:43:54.10	Gregory Taylor	Favorite thing to say is some of you may know was,
01:43:57.74	Gregory Taylor	We don't want to throw the baby out with the bath water.
01:44:01.86	Gregory Taylor	And I'm afraid that's kind of what we did here in Sausalito when we exterminated all the anchor outs, much to our detriment.
01:44:09.52	Gregory Taylor	So I just want to touch on that. I forgot about it.
01:44:12.91	Gregory Taylor	few seconds left. Thank you for being so patient.
01:44:16.15	Gregory Taylor	I'm just a dumb country boy from Louisiana. I don't spell very well.
01:44:20.82	Gregory Taylor	not that good at writing.
01:44:23.05	Gregory Taylor	But I'm good with it.
01:44:24.27	Gregory Taylor	with numbers.
01:44:25.63	Gregory Taylor	And so what I want to tell you is a fellow named Joe Cryans came here as a high-ranking
01:44:30.97	Gregory Taylor	deputy with a Shunoma County Sheriff's Department. He became chief.
01:44:35.17	Gregory Taylor	number of years. Then he moved to Nevada and became chief. And then he retired.
01:44:40.57	Gregory Taylor	He came out of retirement to become the interim police chief for the city of Vallejo. And I read in the IJ, our favorite rag, that he was making over half a million dollars a year. I also read in that same paper that Stacey Gregory, who I like very much, and I'm sure most of the people, if not all in here do too, is only making $210,600 a year.
01:45:07.16	Gregory Taylor	Just remember, when everyone's running away from whatever bad things happen, it's the cops that are running towards it. So let's give everybody a raise. Thank you.
01:45:16.51	Mr. City Clerk	Thank you, sir.
01:45:17.10	Babette McDougall	All right, we have Sandra Bushmaker online.
01:45:22.23	Sandra Bushmaker	Hi everybody.
01:45:23.48	Sandra Bushmaker	Uh,
01:45:24.88	Sandra Bushmaker	Amy Belser and I overlapped, FYI. We were on the council together. And indeed, she used the expression of the devil's in the details. And she frequently, in exasperation, would use the word crikey.
01:45:36.88	Sandra Bushmaker	over and over again. That was her thing.
01:45:39.82	Sandra Bushmaker	Anyway, my question is this. In reading the budget book, I see there's 161% increase in insurance premiums.
01:45:50.01	Sandra Bushmaker	So that's one aspect. Plus we've got out-of-pocket expenses for insurance.
01:45:55.88	Sandra Bushmaker	and our self-insured workers comp.
01:45:59.34	Sandra Bushmaker	and defense legal fees on top of that. I'd really like to know what the number is
01:46:05.30	Sandra Bushmaker	uh,
01:46:06.23	Sandra Bushmaker	and compare it to various years. I thought one of the council members asked for that,
01:46:11.37	Sandra Bushmaker	a chart of those different numbers.
01:46:15.37	Sandra Bushmaker	Those legal defense fees are for insurance claims are on top of the premiums.
01:46:21.26	Sandra Bushmaker	And that is on top of the $606,000 that we're already paying for legal counsel for the city.
01:46:28.30	Sandra Bushmaker	So I would just like to have some
01:46:31.57	Sandra Bushmaker	some solidity in those numbers so that I can compare and contrast, or the public can compare and contrast what we have been paying over the past five years, say, in this department. Because these are considerable increases in costs.
01:46:46.46	Sandra Bushmaker	And I'm concerned about them.
01:46:48.60	Sandra Bushmaker	as we all are, I hope.
01:46:50.37	Sandra Bushmaker	All right. Thank you very much.
01:46:55.21	Babette McDougall	No further public comment?
01:46:57.71	Mr. City Clerk	All right, we'll come back up here.
01:47:01.69	Mr. City Clerk	and open up for discussion.
01:47:06.40	Mr. City Clerk	We could start with a motion, just the recommended motion. Want to do that, Vice Mayor?
01:47:09.81	Mr. City Clerk	Sure.
01:47:09.93	Unknown	Sure. I'll move we adopt a resolution to adopt the fiscal year 2024-2025 city manager's budget and allocated and funded labor positions as required to meet state of California legal requirements.
01:47:23.78	Mr. City Clerk	Second.
01:47:24.59	Mr. City Clerk	Okay, the motion's made and seconded.
01:47:26.82	Mr. City Clerk	let's just go down for discussion starting with either councilmember hoffman or kelman or does someone else want to start
01:47:34.47	Unknown	I'll start. Vice mayor.
01:47:35.04	Mr. City Clerk	Vice Mayor starts.
01:47:35.68	Unknown	It's a great day.
01:47:35.81	Unknown	Sure. I just had a very few comments. So I completely endorse former mayor with these comments about needing to start next year's budgeting process. Now, I think
01:47:47.95	Unknown	We have new staff.
01:47:50.40	Unknown	This has been a learning experience. I think they've done a brilliant job, but as
01:47:56.99	Unknown	evidenced by some of the questions from the dais tonight, there are aspects of the budget that I'd like to see us dig down deeper into. So...
01:48:06.29	Unknown	An example is the pension. So I definitely think we need to better define our long-term plan for addressing pensions, UALs,
01:48:15.17	Unknown	um,
01:48:16.11	Unknown	the use of the 115 trust,
01:48:18.54	Unknown	You know, we set forth a very clear plan in 2018
01:48:22.69	Unknown	for how we would manage long-term pension obligations to flatten the curve in terms of the escalation in premium
01:48:32.80	Unknown	expenses and then that all got
01:48:35.82	Unknown	blown.
01:48:36.95	Unknown	to smithereens by the change in the manner in which CalPERS assigns liability and manages its own funding. And so...
01:48:48.87	Unknown	I, I,
01:48:50.50	Unknown	I don't know when our 10 year plan is going to be complete, but I definitely would like to start planning now for better management of our 115 trust, as well as our long term plan for meeting what we know will be escalating.
01:49:08.02	Unknown	Um,
01:49:08.88	Unknown	pension obligations, even though
01:49:11.40	Unknown	we can't be certain what those are.
01:49:14.48	Unknown	I appreciate cuts in their budgets by various departments this year, the library, city administration, community development, and parks and rec.
01:49:25.98	Unknown	As part of next year's budget process, I'd like to see each department not only provide its projected budget for next year, but also demonstrate how it could cut its budget by 10% if needed.
01:49:40.32	Unknown	I appreciate the refinement in staff costs to more accurately reflect actuality and not top step for each position. I believe we are still overstating our actual labor costs, as I mentioned during questioning, because I don't believe we will reach full staffing this year, moving from 67 to 79.
01:49:59.83	Unknown	full time equivalent positions. And I endorse the comments from former Mayor Bushmaker. I do believe we need to
01:50:12.08	Unknown	commence tracking
01:50:14.68	Unknown	insurance metrics in a way we've never done before because we've never faced the challenges we are now,
01:50:20.31	Unknown	We need to be tracking.
01:50:21.78	Unknown	premium payments, defense costs, and other metrics to really accurately reflect
01:50:31.57	Unknown	the actual expenses we're incurring this year so that we have a better barometer for future years. Those are my comments. Thank you.
01:50:38.60	Mr. City Clerk	Thank you, Vice Mayor. Who would like to go next?
01:50:42.81	Councilmember Blustein	We'll go. I'm happy to go. Council member of Boston.
01:50:43.45	Mr. City Clerk	Because of every blessing.
01:50:44.65	Councilmember Blustein	Sure. Great. And I want to thank staff again for the hard work and effort put in, not just on the planning of the budget by Director Hess, which was really fantastic and thoughtful, but each of the department heads who took the time this year to consider where it made sense to have budget cuts. I know we didn't dig into the SWOT analyses that each of the directors submitted, but that was a lot of work. And I know there'll be consideration for that going forward. So really appreciate the hard work from staff and for all of you to be here tonight for questions as well.
01:51:13.60	Councilmember Blustein	Really appreciate that extra time and effort put in.
01:51:16.69	Councilmember Blustein	And I'm, you know, very much in favor of us moving forward with the budget.
01:51:21.42	Councilmember Blustein	There are some things, though, that I really appreciate that my colleagues brought up this evening that I want to make sure that we do talk about. I really appreciate it that Councilmember Kelman made the point, especially with regards to our reserves, that these are not.
01:51:32.76	Councilmember Blustein	theoretical or hypothetical dollars that we're spending and we need to be accountable and have metrics for those. So I look forward to us reviewing our reserve policy and thinking about how that makes sense going forward and generally being more clear in exactly where the spending for each of those metrics goes to. And to that point, I'm sorry that during questioning this didn't come up, but I did want to give some direction in addition to
01:51:56.36	Councilmember Blustein	moving forward with the budget, that we have some, and maybe we can welcome ideas from others on the dais, but some sort of metrics as well for the care or the cost and revenue efficiency plan, as suggested in the city manager report, because what that's doing is saying,
01:52:11.03	Councilmember Blustein	this is our budget today, but there is opportunity to save more going forward. And so we need to hold staff to that and to understand what those opportunities look like. So what are those expenditures and what are the revenue increasing opportunities and how are we assessing those, whether it's quarterly, what does that look like going forward? And then to add to that, I'm again going to ask that we see that 10 year plan that we've been talking about. I think it's really critical that we come back with that at least definitely by January when we have our mid-year report. But again, I also agree with former Mayor Withey and with the Vice Mayor that our new budgeting process starts tomorrow. So let's get as much information as we possibly can so that we can make smarter decisions for that 10 year plan.
01:52:54.95	Councilmember Blustein	I would really like us to have some additional direction on the care plan so that we can make sure we're following through on these revenue generating opportunities and considering where there might be opportunities for further cuts. I think our staffing is the more realistic approach to how we measure for staffing. I think it's good that we keep it at the full staff because I would like to see us get to a level of service where we do have all of our positions filled one day, dare to dream. But again, I really appreciate the hard work of staff here and think we can move forward, but want to have metrics for both reserve policy and the care policy going forward.
01:53:29.77	Mr. City Clerk	Thank you, Council Member.
01:53:33.01	Mr. City Clerk	Councilor Hoffman?
01:53:35.66	Councilmember Hoffman	Thank you. And thank you to the staff for all your hard work on this. I will note that the budget book is attached to the agenda. And so the agenda tonight actually is attached last week and the week prior. So.
01:53:49.33	Councilmember Hoffman	just search for budget book on the, on the agenda. So my concern and my questions with regard to the staff and the methodology was, uh, what to highlight, um,
01:54:00.36	Councilmember Hoffman	what I think is a, uh, underreporting of our deficit. And it's the, the math is pretty easy. You just look at a million dollar, uh, increased costs and staff, uh, costs from last year to this year. And you just say methodology that summary Chad did. And that's, um, that's slide 19 to the, um, to the, uh,
01:54:22.25	Councilmember Hoffman	presentation last week. So there was a presentation, a slide presentation by Chad and then slide 19 where he calls that out.
01:54:28.24	Councilmember Hoffman	and gives us that number. So
01:54:30.10	Councilmember Hoffman	Like I said, there were two issues tonight. One was, do we want to change the methodology, which I think it seems we do.
01:54:35.90	Councilmember Hoffman	But the second issue was consistently applying that, whatever methodology it is, the prior one or the current one,
01:54:42.84	Councilmember Hoffman	The result is the same. You have a million dollars change in staff.
01:54:48.56	Councilmember Hoffman	staff costs, but that's not how it's reflected in the budget and that's my concern. Overall though, I think
01:54:56.86	Councilmember Hoffman	I think it's interesting that, you know, the proposition that we start budgeting, you know, tomorrow. And I completely agree with that. And I think it would be helpful to reconstitute the Finance Committee. So of the committees, the vote that we made in 2021 to dissolve the non-statutory boards and commissions. The only one we actually dissolved was the finance committee. And so that was probably...
01:55:29.72	Councilmember Hoffman	the most helpful committee that we had at the at the council level and actually for the staff level because
01:55:35.45	Councilmember Hoffman	The finance committee, I've served on it. The vice mayor served on it. I think Councilmember Kellman served on it. And, you know, it forces the staff to look at these things, these questions and issues.
01:55:47.32	Councilmember Hoffman	consistently throughout the year, and you have vetting by two council members of whatever it is we're talking about.
01:55:54.02	Councilmember Hoffman	I think that would be helpful. We are working on the 10-year plan, but we haven't met since 2023. So we haven't actually had a meeting for more than six months. And so I think that if we reconstituted the finance committee,
01:56:06.76	Councilmember Hoffman	and had a monthly meeting, a part of that would be the 10-year plan, obviously, but it would also be some of these other things that we've been talking about,
01:56:13.94	Councilmember Hoffman	which I think have a lot of merit
01:56:16.71	Councilmember Hoffman	um and and i've discussed it with chad and i know councilman kelman has too especially about the pension risk and about all these other financial risks and how to address them and that will help us i think with our overall risk that we're looking at with our when you pull them all into the same bucket of increased insurance that is absolutely you know a tremendous increased financial risk for us. And then also how to attack that decreasing some of the other geologic issues and streets and sidewalks. And that goes back to
01:56:49.94	Councilmember Hoffman	the conversation we just had on the first item
01:56:52.25	Councilmember Hoffman	with regard to the reserve and what do we do with our unassigned funds? Do we just leave them sitting there or do we actually put them to work? I completely agree that we should put them to work.
01:57:01.75	Councilmember Hoffman	as a strategy to reduce our risk. So those are my thoughts.
01:57:07.29	Mr. City Clerk	Council Member Kellman.
01:57:08.52	Councilmember Kelman	Thank you, everybody. Again, very hard work and appreciate staff and city manager.
01:57:14.36	Councilmember Kelman	and Director has bringing this to us. I think my colleagues captured
01:57:18.14	Councilmember Kelman	a lot of the straight on budget stuff very well so i'll try to offer something a little bit different which is uh i kind of approached tonight thinking this is going to be a little bit more of a strategy meeting as well as the budget approval and so part of me is some of my comments will be more strategic um but i just want to note that on page two of the staff report um
01:57:38.35	Councilmember Kelman	First paragraph, we said that increased costs relating to pension UAL payments, doubling of insurance premiums, and a slowdown in sales tax revenue have created the perfect storm for the city.
01:57:50.17	Councilmember Kelman	I think right there, that is a roadmap.
01:57:52.38	Councilmember Kelman	for first thing tomorrow morning, what we should be focusing on for our budget.
01:57:56.58	Councilmember Kelman	And one of the things that I didn't get out of tonight's conversation, and I don't know that it was appropriate to get it, but I wanted to nonetheless, is some direction to allocate for those budget priorities. We talked about this during the reserve policy and risk management. I want to know how we're going to address roads and resilience. Should we have talked tonight about more funds for those two things? Should we have heard from Director McGowan around the Cabinet Improvement Program and the status of the GAD and our geologic hazards? Should we have heard more from our police chief around public health and safety? I mean, it feels like we have some of those concerns, and we're approving a budget without really talking about the strategy behind the budget. We were all provided with some confidential information on tenure claim statistics. And if you looked at those from our city attorney, you will, I think, agree with me that there are specific actions we can and should prioritize in our budget to address that risk. And so I just, that was missing for me tonight. And I just wanna share that. It might not have been the appropriate meeting to have that conversation, but I just wanna share that with my colleagues. I also just wanna mention and support the reconvening of the finance committee and that 10-year plan post-haste. In fact, I would love to hear an update
01:59:15.35	Councilmember Kelman	I don't know, within two council meetings or whatever is reasonable for that subcommittee. And I also think we need to have some time frames for review.
01:59:22.44	Councilmember Kelman	Again, if we are going to balance a budget based on anticipated action, then how frequently will we hear updates on those anticipated actions? City Manager and I talked today about Marinship Park. I realized, and it's not a priority, by any means saying that that's a priority, but I realized there are certain projects we haven't heard about in a while, and I think we should continue to make sure we have that running list and run through them. And so I just feel like...
01:59:47.23	Councilmember Kelman	We have six items we have from a strategy session.
01:59:49.98	Councilmember Kelman	I would love to see them continually blended into
01:59:53.37	Councilmember Kelman	the budget.
01:59:54.16	Councilmember Kelman	And so whatever time you start tomorrow morning when we start our new budget cycle, I think that we need to keep thinking about those and focusing on those. And again, page two, the staff report outlines exactly those perfect storm events.
02:00:09.81	Mr. City Clerk	you council member uh all right well i just want to thank the maybe i'll take my
02:00:15.90	Mr. City Clerk	comments just to say thank you to the staff. This was a robust discussion and to my colleagues, but really just kudos to the staff. A real fire drill around the insurance situation. Again, it's easy to move on to the next problem, but I really want to triple underline the extraordinary accomplishment that the...
02:00:33.69	Mr. City Clerk	city employees accomplished on behalf of all our citizens, residents here in Sausalito, in acquiring a new insurance carrier at a
02:00:45.04	Mr. City Clerk	best possible circumstance among the options price so uh kudos uh excited for the budget underlining that we are ending this year this fiscal year ending in surplus the previous fiscal year we had a surplus previous year to that we had a surplus this year we're forecasting a deficit uh if we are successful in hiring fully so uh we have the opportunity to do mid-course correction as and with the attention of all of us here on the dais and with the members of the community, I'm sure we're going to continue to fine-tune this. I look at low-hanging fruit around revenue generation as well here in town. The way we really are going to solve our infrastructure problem is not by tweaking around the edges, saving a few thousand dollars here and there. The way we're really going to tackle our infrastructure challenges is we're going to
02:01:22.93	City Manager	town.
02:01:36.65	Mr. City Clerk	amplifying the business model of Sausalito. And we have that capacity in town. We have an incredible
02:01:42.40	Mr. City Clerk	unfair competitive advantage and extraordinary resources from the blue economy possibilities in the industrial zone.
02:01:49.59	Mr. City Clerk	to a different way of thinking about our businesses here in town. So I think that there is a case for optimism, not least because of the clear
02:02:01.45	Mr. City Clerk	improving excellence of our staff that's on display and how it handled the insurance and handled the entire budget this year so. The next year budgeting process does indeed start tomorrow and i'll go ahead and just call the question on the motion which was made and seconded so. All in favor say aye.
02:02:19.37	Councilmember Blustein	Oh.
02:02:20.52	Councilmember Blustein	Aye. Aye. All opposed?
02:02:21.20	Mr. City Clerk	All opposed?
02:02:22.90	Mr. City Clerk	Okay, motion carries unanimously. We'll now move on to item 5C, adoption of a resolution for the GAN limit for the fiscal year 2025. Mayor- Manager, yes.
02:02:31.15	Councilmember Hoffman	Mayor.
02:02:32.48	Councilmember Hoffman	Sorry, before we move on, I think I would like to have, because it's on the agenda, because it's in the scope of this item that we just took a motion on it, but we can still have a policy discussion and direction to staff about how we want to address these things with regard to risk factors, right? So it would, and I'm just building on Councilman Raquelman's discussion. I mean, it's eight o'clock. The next two things I think are going to go fairly quickly. We set this meeting aside to discuss.
02:03:03.10	Councilmember Hoffman	finance and policy issues. So I think that might be helpful to help guide us forward.
02:03:03.18	Mr. City Clerk	Perfect.
02:03:07.52	Mr. City Clerk	Finally, is there a proposal for some direction that you or Councilmember Kelman have that you wanted to provide under the auspices of the adoption of the budget that's allowed under that?
02:03:17.96	Unknown	I think we've already given direction.
02:03:19.94	Mr. City Clerk	Okay.
02:03:20.09	Unknown	Given each of our comments here this evening and what we think should be prioritized, I'd like to hear back from city staff in response to our direction with their plan for implementing, such as reconstituting the Finance Committee and identifying risk factors to start tracking for creating our upcoming budget.
02:03:41.57	Councilmember Hoffman	Well, I think, yeah, let me just refine that a little bit. Because I think...
02:03:46.35	Councilmember Hoffman	I think based on the staff report and the discussions that we've had,
02:03:50.53	Councilmember Hoffman	I believe we all agree that we want to attack
02:03:55.24	Councilmember Hoffman	as a policy matter and direction to staff, right, of prioritizing, the priority is matters that are going to reduce our risk factors with our insurance coverage. And those are very defined sort of buckets. That's number one. Number two is, and that's in the buckets I think we already talked about in the, in the, um, well, I don't actually, we haven't talked about yet because insurance is coming up, but, um, but we actually, sorry, we did talk about a little bit on the reserve policy because they're kind of mushed together now, but okay. So I think it's, you know, it's, um, addressing those risk factors, right? So it's sidewalks it it's low hanging fruit. Number one is the sidewalks. Number two is reducing
02:04:47.62	Councilmember Hoffman	the overall instance of
02:04:52.26	Councilmember Hoffman	the geologic hazards in town, right? Which is different from sidewalks, but geologic hazards means, you know, the subsidence and our hillside issues, which led to the landslides in 2019.
02:05:07.82	Councilmember Hoffman	and also the landslide
02:05:09.27	Councilmember Hoffman	um,
02:05:10.98	Councilmember Hoffman	1999 or 98 and also the landslides that we currently have that are, um,
02:05:17.12	Councilmember Hoffman	still existing in Sausalito. So that's number two. I can't remember what the third one is, if anybody else can too, but,
02:05:24.71	Unknown	So we had infrastructure, pension UAL payments. Oh, yeah, yeah. Thank you. Thank you. Thank you. Slow down in sales tax revenue. I took notes as Council Member Kellman was speaking. So I'm happy to share my notes with city staff.
02:05:28.04	Councilmember Hoffman	Oh, yeah, yeah.
02:05:37.35	Unknown	But we've been over this.
02:05:38.73	Councilmember Hoffman	But I think that's what we haven't given direction on it. And we haven't said that's what we're going to adhere to as a council as a policy matter. And that's, that's what I'm hoping, I'm just putting it out there that that might be a good outcome for our discussion tonight while we're on this item. It's within the scope of certainly our
02:05:44.81	Unknown	Thank you.
02:05:44.83	Unknown	Well,
02:05:45.08	Unknown	All right.
02:05:58.11	Unknown	Thank you.
02:05:58.19	Councilmember Hoffman	our
02:05:58.95	Unknown	Thank you.
02:05:59.73	Unknown	I'm going to-
02:05:59.81	Councilmember Hoffman	I'm good.
02:06:00.03	Unknown	I'm not prepared to discuss these strategies. We have separate meetings set up to discuss the infrastructure, the geologic hazards, sidewalks and roads and resilience, all of the items enunciated in the city manager's letter to the
02:06:18.85	Unknown	to prism to persuade them to
02:06:21.83	Unknown	take us on.
02:06:23.17	Unknown	I have not come prepared tonight to thoughtfully
02:06:26.39	Unknown	Provide direction on these items, although i'm happy to do it at a future meeting.
02:06:30.15	Councilmember Hoffman	Yeah, I...
02:06:30.17	Unknown	Yeah.
02:06:30.98	Councilmember Hoffman	Let me just follow up on that, and I think that's fine to move on.
02:06:32.68	Mr. City Clerk	that's fine to move on i can cry let's let's just that was a great list we have it
02:06:37.14	Councilmember Hoffman	But let me just follow if you don't mind. So I think that then, you know, stove piping, it doesn't help us. Right. We need to be able to talk about it comprehensively as a council and prioritize. So to your point, I agree that we probably need to set then another city council meeting to help us prioritize moving forward and set it soon. Like that needs to be very soon so that, because that provides the roadmap of what staff prepares and what makes it on our agenda and what doesn't. And that's what I think has been lacking.
02:07:09.98	Mr. City Clerk	Thank you, council member. Let's add that to the future agenda items, city clerk. Item 2C, adopt a resolution for the GAN limit for fiscal year 2025. City manager, are you giving this? Director Chas, please. Chas, please go ahead.
02:07:26.23	Mr. City Clerk	Thank you.
02:07:26.24	Councilmember Blustein	Yes.
02:07:26.68	Mr. City Clerk	Thanks.
02:07:27.01	Councilmember Blustein	you
02:07:27.27	Mr. City Clerk	Director check.
02:07:27.73	Councilmember Blustein	Yes, we're going to start calling you Jess.
02:07:30.26	Mr. City Clerk	Director Hess, please go ahead. Here we go.
02:07:31.46	Director Hess	Here we go.
02:07:32.35	Director Hess	All right, one second. Let me pull up the GAN limit here.
02:07:34.89	Director Hess	So the GAN limit is a state requirement that we pass a, or we do a calculation every year that is based upon
02:07:44.02	Director Hess	the change in population and the change in CPI.
02:07:48.47	Director Hess	What it does is, let me share my screen here and I'll show you the resolution. We'll just walk through the calculation real quick.
02:07:57.55	Director Hess	All right, so here is the GAN limit. We start with last year's GAN limit as our starting point.
02:08:03.56	Director Hess	The state publishes population for each county and city.
02:08:07.98	Mr. City Clerk	You're going to have to make your font size bigger.
02:08:09.88	Director Hess	Oh, yes.
02:08:11.06	Director Hess	Sorry about that.
02:08:12.35	Mr. City Clerk	if you actually want to, or just read the numbers out loud. Yeah.
02:08:14.63	Director Hess	Thank you.
02:08:14.64	Unknown	Yeah.
02:08:15.35	Mr. City Clerk	that.
02:08:15.59	Unknown	Well, we have a staff report.
02:08:17.16	Mr. City Clerk	just for the members of the public that may not. So it is in the staff report for anyone who's watching at home that would follow along, but that's-
02:08:19.00	Unknown	May not.
02:08:19.79	Director Hess	It is in the city.
02:08:24.67	Director Hess	That's better.
02:08:26.45	Mr. City Clerk	Yes, we can.
02:08:26.69	Director Hess	We can.
02:08:27.70	Mr. City Clerk	Go ahead.
02:08:28.02	Director Hess	Okay, so our starting point is last year's
02:08:31.62	Director Hess	appropriation limit, and then we take the change in population
02:08:35.99	Director Hess	based upon the city or county, whichever is more favorable,
02:08:40.33	Director Hess	to the city.
02:08:41.52	Director Hess	And then we also do the change in per capita income, which is published by the state to arrive at our new updated GAN limit. And this is the amount of tax revenues that we're allowed to spend in a given fiscal year.
02:08:54.62	Director Hess	Then we compare that number to the taxes that we collect and expect to spend.
02:09:00.15	Director Hess	and compare that to the GAN limit. And if we exceed the GAN limit, we have to bring it to a vote to officially exceed that GAN limit.
02:09:08.95	Director Hess	In the case of Sidious Hausalito, we are $4.7 million below the GAN limit, so we have plenty of thresholds.
02:09:14.70	Director Hess	under this calculation.
02:09:16.96	Director Hess	Now it could be noted and it is noted in the staff report that we went back and recalculated
02:09:22.24	Director Hess	the GAN limit for a number of years because we were always using the city's income population
02:09:29.35	Director Hess	And we are allowed to use the city or county. So we went back and recalculated that.
02:09:35.26	Director Hess	for a number of years so we can
02:09:37.73	Director Hess	increase our GAN limit in the event that we need additional capacity.
02:09:42.75	Director Hess	Um,
02:09:44.89	Director Hess	really all I have to share about the GAN limit. It's kind of a technicality that we have to
02:09:49.68	Director Hess	to pass by resolution.
02:09:51.54	Director Hess	before the budget year began.
02:09:56.43	Mr. City Clerk	Thank you, Director Hess. Any questions?
02:10:00.74	Mr. City Clerk	No questions, we'll open public comment, city clerk.
02:10:05.27	Babette McDougall	Babette McDougall, do you want to make up? Okay. She's passing it.
02:10:07.69	Mr. City Clerk	keep passing.
02:10:08.30	Mr. City Clerk	you
02:10:09.34	Mr. City Clerk	Seeing none. Okay. We'll close public comment. Any discussion?
02:10:12.73	Unknown	Mayor, I'll go ahead and move. We adopt a resolution which selects per capita personal income and city population as the factors to be used.
02:10:21.27	Unknown	in calculating the fiscal year
02:10:24.04	Unknown	2025 appropriations
02:10:26.84	Unknown	limit and that we adopt the attached resolution.
02:10:33.20	Unknown	Second. Oh, you can have it, Councilmember Kelman.
02:10:33.93	Mr. City Clerk	Okay.
02:10:35.55	Mr. City Clerk	Second made and seconded by Councilmember Kelman.
02:10:35.73	Councilmember Blustein	Thank you.
02:10:35.75	Unknown	Move it along.
02:10:39.62	Unknown	So, Councilmember Hoffman just stepped out
02:10:41.88	Mr. City Clerk	I presume she...
02:10:43.99	Mr. City Clerk	feels this is a non-controversial vote and probably would be offended by
02:10:51.09	Mr. City Clerk	All right, we'll take a... Actually, let's take a...
02:10:54.74	Mr. City Clerk	one minute bio break as the question hangs in the balance and we'll be back in one minute councilmember hoffman is to adopt the recommended motion as made by the vice mayor seconded by councilmember kelman so all in favor of this motion
02:11:08.66	Mr. City Clerk	Any opposed? Motion unanimously carried. Moving on to item 2D.
02:11:15.76	Mr. City Clerk	the adoption of a resolution improving an investment policy for 2025 fiscal year.
02:11:21.13	Mr. City Clerk	City manager, do you have a reporter that Director Hess?
02:11:24.05	Director Hess	Yes, that would be me as well. So a annual requirement of the city is to adopt a investment policy.
02:11:31.57	Director Hess	So before you tonight, we have a resolution to officially adopt our investment policy for fiscal year 24-25.
02:11:38.34	Director Hess	There have been no changes to the investment policy at this time.
02:11:43.64	Director Hess	So it would be the same investment policy that was approved last year.
02:11:48.60	Director Hess	All right.
02:11:49.24	Director Hess	Yeah. Are there any questions from council on what's in the...
02:11:52.48	Unknown	in the world.
02:11:52.58	Mr. City Clerk	Thank you.
02:11:52.60	Unknown	has a question.
02:11:53.09	Mr. City Clerk	I think.
02:11:53.93	Unknown	I have a question. So I back in the beginning in mid-May, forwarded to you, Director Hess, and to the city manager,
02:12:04.50	Unknown	information about California class, which is an alternative to LEIF. And I was hoping that we would consider diversifying our investment policy to include California class, since it performs equally or better to LEIF.
02:12:09.22	City Manager	Alternative.
02:12:21.03	Unknown	circumstances. So can you please advise on the status of that consideration?
02:12:21.25	City Manager	Good night.
02:12:26.05	Unknown	Thank you.
02:12:26.06	Director Hess	Yes. So that is, it's not in the budget book.
02:12:30.05	Director Hess	or I'm sorry, the investment policy at this point. But if that is a direction that the council would like to take, I would be willing to
02:12:38.85	Director Hess	update the investment policy to include that.
02:12:42.13	Director Hess	as
02:12:43.26	Director Hess	an acceptable investment based upon the state's regulation on what we can invest in.
02:12:48.31	Director Hess	Each year, the state updates their investment guide or their investment policy, so we need to make sure that we are in compliance with that as well.
02:12:55.54	Director Hess	If that is desired,
02:12:55.91	City Manager	If that's...
02:12:58.61	Director Hess	I would ask that we adopt this this evening just so it's in place, but then I can bring a new investment policy back.
02:13:04.57	Director Hess	at a later council meeting as a consent item.
02:13:07.83	Unknown	So I would just ask my fellow council members I provided information, it is an alternative to late that actually provides more flexibility. In in certain ways and allows you to earmark funds and withdraw funds with no penalty so again I am just asking that staff bring that back to us for consideration.
02:13:25.23	Councilmember Kelman	Shake that ice for them. Me too. I don't know anything bad, but I support it.
02:13:26.65	Unknown	Thank you.
02:13:26.66	Unknown	Thank you.
02:13:26.80	Unknown	Thank you.
02:13:26.86	Unknown	Thank you.
02:13:29.04	Mr. City Clerk	Any other questions? Yes, Calvin.
02:13:30.29	Councilmember Kelman	Yes, me. You're emerging on the names.
02:13:36.25	Councilmember Kelman	Um...
02:13:37.18	Councilmember Kelman	So this is just maybe a question for you, Mayor, but an education question. So you very wisely helped us identify an opportunity for higher interest bearing account for some of our monies. What actions are we taking to pursue those opportunities? What other options might there be? We won't have that low hanging fruit again, I hope, because that means we've taken care of it.
02:14:00.31	Councilmember Kelman	Where else might we look for those advantages?
02:14:04.34	Mr. City Clerk	That's a question your director has.
02:14:06.06	Director Hess	Yeah, so currently we are invested in treasuries.
02:14:10.54	Director Hess	We could also invest in these investment pools like LEIF or CLASS.
02:14:16.95	Director Hess	And really their return, I believe, would be very similar to our treasury bills that we currently receive.
02:14:23.40	Director Hess	Right now, we're trading treasuries right around that 5% mark.
02:14:27.88	Director Hess	for one year out maturities.
02:14:30.57	Director Hess	Um,
02:14:31.43	Director Hess	But as of now, I'm
02:14:34.33	Director Hess	actively managing our cash that is in our primary checking account and trying to keep that as low as possible to meet the
02:14:42.33	Director Hess	city's cash flow needs.
02:14:44.68	Director Hess	And the remainder, I am investing in T-bills as it stands now. But I am open to considering LEIF or CLASS.
02:14:52.34	Director Hess	as an alternative to, again, earn additional yield, but safety is paramount in that discussion.
02:15:01.21	Sergio	Yeah, and on that on that subject, just to supplement that state law does generally restrict
02:15:09.16	Sergio	what kind of investments are permitted for municipal governments in terms of permitted securities and where you can
02:15:17.48	Sergio	Um,
02:15:18.56	Sergio	put your unallocated reserves. The purpose of those restrictions are to
02:15:24.95	Sergio	prevent and safeguard from speculative investments. So there is a statutory list of kinds of instruments that the city is allowed to invest in.
02:15:33.95	Councilmember Kelman	Thank you, Sergio. And then might I request that the reconstituted finance committee that hopefully meet very soon review those statements on a regular basis and just be aware of market forces and opportunities.
02:15:46.98	Councilmember Kelman	by matter of policy.
02:15:51.08	Mr. City Clerk	So my question, Chad, are there any other questions?
02:15:55.47	Mr. City Clerk	uh,
02:15:57.17	Mr. City Clerk	Great that we own some T-bills. Did you build a T-bill ladder?
02:16:00.29	Director Hess	Yes, I have maturities every month.
02:16:02.82	Mr. City Clerk	How far out is your ladder?
02:16:04.06	Director Hess	It goes out. I've got a trade that'll be placed on Thursday and it'll bring me out to July of 2025.
02:16:12.09	Mr. City Clerk	That's a policy choice therein about whether, especially now, when we might be in a period of peak interest rates and the capacity to lock in over-term yields going forward, there could be substantial security there. But of course, when you do that, that money, though not locked up because the treasuries is a very liquid market, you can always get it out. You can suffer loss if you're forced to get it out. So you'd want to- Yes.
02:16:20.86	Unknown	Yeah.
02:16:35.65	Director Hess	Yes, there is interest rate risk.
02:16:37.43	Mr. City Clerk	You want to put money there that you actually don't need and,
02:16:41.30	Mr. City Clerk	And so there is a policy discussion to be had about that, but we would have to be presented with
02:16:46.44	Mr. City Clerk	alternatives by a professional like you.
02:16:48.88	Mr. City Clerk	in concert with our banking partners, to understand the best practice about how much to lock into a longer-term bond versus a shorter-term bond. And I'm wondering, do you need direction as part of this?
02:16:51.54	Director Hess	you know,
02:17:03.22	Mr. City Clerk	in that way or would that be something direction that we can give you individually and as a council leader.
02:17:09.77	Director Hess	Yeah, I would be open to either. I guess my...
02:17:14.27	Director Hess	My comfort level is right around that year mark. I don't want, like you said, commit myself and need that cash and be exposed to interest rate risk. But I would be open to extending that out to
02:17:25.92	Director Hess	potentially two or three year maturities for a portion of our portfolio, as we have significant resources that we,
02:17:32.31	Director Hess	are not spending.
02:17:33.78	Director Hess	So, yeah, I would be open to that. And I think it would be a great discussion in the finance committee to have those discussions on where do we want to invest.
02:17:41.80	Director Hess	And what are those alternatives?
02:17:44.70	Director Hess	So I would be open to a discussion, you know, here or privately.
02:17:49.54	Mr. City Clerk	And then it's a question that could lead to a comment later, but we were having a discussion about the 115 whether to take money in our budget from the 115 trust or whether to take it in funds in excess of reserves. Correct. And because the great accomplishment of the previous city councils of which I think Councilmember Hoffman and the vice mayor or a member, we had a plan that was put together for
02:18:01.84	Councilmember Hoffman	Correct.
02:18:17.00	Mr. City Clerk	both investing in the 115 trust and rolling funds out of that.
02:18:21.25	Mr. City Clerk	But that was done at a time of...
02:18:23.97	Mr. City Clerk	an era of low interest rates. And amazingly, that fund is the worst performing
02:18:29.82	Mr. City Clerk	investment asset currently yeah since money is fungible there have been a
02:18:34.21	Mr. City Clerk	kind of an apples to apples argument to take money out of the funds in excess of reserves.
02:18:40.55	Mr. City Clerk	just because out of the 115 trust, because it's earning lower. So the question is, I get, I know we can switch advisors, but they take a fee and they also have these sort of, I'll call them outdated, some balance models. Is there an alternative in the 115 trust that you can present to us? And is this part of today's discussion or a future one?
02:18:48.92	City Manager	I've been here.
02:18:49.02	Unknown	Thank you.
02:19:01.34	Mr. City Clerk	for, uh,
02:19:03.10	Mr. City Clerk	or at least considering the alternative of building a bond ladder inside the 115 trust of treasuries.
02:19:08.74	Director Hess	Yeah, so my understanding is there's a limited number of
02:19:13.31	Director Hess	of companies that can
02:19:15.10	Director Hess	allow or
02:19:17.90	Director Hess	administer Section 115 trusts in the state. PARS is one of them.
02:19:21.91	Director Hess	And CalPERS is the other that I know of that are allowed in the state of California.
02:19:26.72	Director Hess	We are starting conversations with helpers to invest in their Section 115 Trusts and learn more about their investment opportunities.
02:19:34.98	Director Hess	From my current understanding, they only offer kind of select balanced models.
02:19:41.24	Director Hess	as we are seeing in PARS.
02:19:43.68	Director Hess	You can't specifically pick treasuries or build a ladder.
02:19:47.26	Director Hess	under that model is my understanding.
02:19:49.89	Director Hess	Um,
02:19:50.57	Director Hess	But it would be a future council meeting discussion once we have more information from CalPERS.
02:19:55.16	Mr. City Clerk	So is that something you can investigate then?
02:19:58.26	Mr. City Clerk	Council member. Yes, yes, I can. I will add that maybe if you decide to your list.
02:19:58.47	Director Hess	Yeah.
02:19:59.19	Director Hess	Yes, I can.
02:20:03.90	Mr. City Clerk	And then one question about UAL as it ties to the investment policy. An investment of cash into the CalPERS fund, is that on an apples-to-apples basis, is that yielding 6.8% or does it yield something different?
02:20:20.99	Mr. City Clerk	because of that.
02:20:21.35	Director Hess	So the CalPERS Section 115 trust itself is not a...
02:20:27.61	Director Hess	guaranteed 6.8%. It is market driven.
02:20:31.32	Director Hess	If we chose to pay down our UAL with a discretionary payment,
02:20:37.24	Director Hess	we would effectively realize a 6.8%.
02:20:40.92	Director Hess	return because that is the interest rate that they are charging on that outstanding debt.
02:20:45.77	Director Hess	So if we pay down our 6.8% debt, we would incur less interest
02:20:49.99	Director Hess	and in the end, save us additional dollars.
02:20:53.12	Director Hess	So that is an option to, to,
02:20:55.27	Director Hess	start paying it down instead of leaving the dollars in the 115 trust.
02:20:58.76	Mr. City Clerk	Thank you.
02:21:00.08	Mr. City Clerk	if there are no more questions we'll take public comment please uh any public comment city clerk
02:21:05.59	Mr. City Clerk	Miss McDougal has raised her hand here in the audience.
02:21:06.20	Director Hess	I miss McGee.
02:21:17.15	Miss McDougal	Thank you.
02:21:18.76	Miss McDougal	So I want to go back to this general idea of a policy for people.
02:21:23.30	Miss McDougal	investments going forward.
02:21:25.98	Miss McDougal	Again, going back to the problem of risk management.
02:21:28.90	Miss McDougal	which is fundamental to just about every aspect of your discussion this evening.
02:21:33.64	Miss McDougal	So looking ahead,
02:21:35.97	Miss McDougal	balls that are in motion,
02:21:38.03	Miss McDougal	What do the implications of transitioning, say, to charter city status involve?
02:21:43.88	Miss McDougal	Are there going to be costs to the city of Sausalito as a charter city, for example? I mean, we have only begun this discussion. So how this is going to impact a decision you might make going forward on how to allocate or reallocate, either with more conservative ideas.
02:21:59.95	Miss McDougal	or more ambitious.
02:22:02.06	Miss McDougal	leanings.
02:22:03.37	Miss McDougal	is affected by these kinds of here and now questions. So I think the idea of trying to not come back to the here and now and where we are in the here and now
02:22:13.26	Miss McDougal	within the context of these policy discussions,
02:22:16.96	Miss McDougal	is something that I'd like to invite your attention to once again.
02:22:21.18	Miss McDougal	Um,
02:22:22.66	Miss McDougal	Maybe a more open democratic exchange would help to focus how the citizens' concerns right now can be more appropriately reflected in the bigger policy questions that you wish to attack this evening.
02:22:37.26	Miss McDougal	and the degree to which they may or may not connect. Thank you.
02:22:42.91	Mr. City Clerk	Anyone online, Mr. City Clerk? See no further public comment. Close public comment.
02:22:49.04	Mr. City Clerk	Would you like to make a motion?
02:22:49.92	Unknown	Yes, Mayor, I will make a motion that we adopt the resolution of the City Council of the City of Sausalito, annual approval of the investment policy.
02:23:01.73	Unknown	Second.
02:23:02.57	Mr. City Clerk	Motion's made and seconded. Any discussion or we'll just move to a vote?
02:23:05.84	Unknown	Thank you.
02:23:05.88	Councilmember Kelman	Vice Mayor, did you want to add the direction on the other?
02:23:09.03	Councilmember Kelman	Thank you.
02:23:09.05	Unknown	I, yes, I would like to add direction that staff, that's separate from the motion. I would like to add direction
02:23:17.10	Unknown	that the staff continue to explore additional investment opportunities, including class,
02:23:22.11	Unknown	Review of T Bill Ladder.
02:23:23.87	Unknown	Approaches where appropriate.
02:23:26.11	Unknown	the
02:23:27.83	Unknown	appropriate administrator for our 115 trust and the programs
02:23:32.78	Unknown	and the investments
02:23:35.36	Unknown	the investment direction for whoever that administrator may be.
02:23:41.59	Mr. City Clerk	Okay motions made and seconded.
02:23:44.08	Mr. City Clerk	All in favor?
02:23:45.69	Mr. City Clerk	Aye. Opposed?
02:23:45.72	Unknown	I...
02:23:47.51	Mr. City Clerk	Okay, motion carries unanimously. I don't shoot.
02:23:50.50	Unknown	One correction, if we can spell the mayor's name correctly on the resolution, that would be great. Thank you.
02:23:55.83	Mr. City Clerk	Okay.
02:23:58.14	Mr. City Clerk	uh,
02:23:58.97	Mr. City Clerk	Thank you.
02:23:59.34	Mr. City Clerk	2e, adopt a resolution of the City Council of Casa Salido to join the Public Risk Innovation Solutions and Management.
02:24:06.33	Mr. City Clerk	known by its acronym PRISM,
02:24:08.20	Mr. City Clerk	Authorize the city manager to approve all program documents related to GL1 excess workers' compensation and property programs. City manager, is this yours? Is it City Director Hess? City Attorney, Mr. Rudin.
02:24:24.23	Sergio	So I will field this agenda item. So
02:24:30.68	Sergio	The proposed item before you is necessary for the city to join PRISM.
02:24:36.68	Sergio	Um,
02:24:37.66	Sergio	The resolution that is being presented to you tonight would authorize the city, would approve the joint powers agreement. PRISM is a joint powers authority for the purpose of pooled self-insurance programs among the counties and various other public agencies in the state of California.
02:24:57.42	Sergio	The resolution will also authorize the city manager to execute all the memorandums of coverage and all related program documents for the general liability excess workers comp and property coverages that are provided by PRISM.
02:25:13.66	Sergio	Um,
02:25:15.41	Sergio	And
02:25:16.96	Sergio	David Ensign, Again, I think, as Chad has this evening presented you as part of the budget agenda item the programs of insurance that are available through prism are the most cost effective options that the city has been presented with today.
02:25:34.38	Sergio	and the
02:25:36.12	Sergio	Differences in terms of premium cost are, um,
02:25:40.07	Sergio	significantly lower than the coverage that would be available for the general liability and for the property coverages on the private market.
02:25:48.99	Sergio	Um,
02:25:49.99	Sergio	In terms of alternatives on workers comp there is some discussion in your staff report on that particular subject, the city does have an alternative available option with the state compensation insurance fund based on recent discussions with hub, the initial quote that the city received at $302,000.
02:26:08.91	Sergio	302.
02:26:11.20	Sergio	Uh,
02:26:12.16	Sergio	300,000
02:26:13.66	Sergio	uh,
02:26:15.55	Sergio	And,
02:26:16.55	Sergio	would be adjusted based on the city's experience modification.
02:26:21.51	Sergio	potentially upwards
02:26:24.62	Sergio	closer to 400,000.
02:26:26.76	Sergio	making the excess workers comp and potentially self-insurance
02:26:33.19	Sergio	for the primary layer under 350,000 SIR
02:26:37.32	Sergio	a more cost-effective strategy for the city to pursue.
02:26:41.41	Sergio	So with that, I'm available for any questions.
02:26:44.33	Mr. City Clerk	Thank you, Mr. Rudin. Any questions for our city attorney?
02:26:48.34	Mr. City Clerk	It comes from Everhoffman.
02:26:49.69	Councilmember Hoffman	Yeah, this is just a summary question.
02:26:53.98	Councilmember Hoffman	because we got some late information, I think that was supplemental to what's in the staff report. So I just, and I did send an email that you were CC'd on Sergio about this later this afternoon. So it looks to me like,
02:27:06.11	Councilmember Hoffman	and either you or Chad can weigh in on this,
02:27:09.37	Councilmember Hoffman	But it looks to me like our total...
02:27:11.93	Councilmember Hoffman	Self-insured.
02:27:14.99	Councilmember Hoffman	obligation starting next year.
02:27:18.16	Councilmember Hoffman	is going to be $875,000 a year. Is that, that's...
02:27:24.73	Councilmember Hoffman	we will pay everything under that in different categories. So I know there's different categories, but I asked for what the total was amongst the property, amongst workers' comp,
02:27:34.80	Councilmember Hoffman	And it looks to me like the total SIR across all is 875,000.
02:27:41.04	Councilmember Hoffman	Is that, have I got that right?
02:27:42.48	Sergio	So under the prison programs, the city's SIR for the property program is –
02:27:50.05	Sergio	$25,000 for
02:27:52.35	Sergio	all property related risks.
02:27:54.53	Sergio	Um,
02:27:55.99	Sergio	And that is of course insurance for the city's own property, not for property damage for other people's property.
02:28:02.68	Sergio	Um,
02:28:04.03	Sergio	under the general liability program. And that is again per claim.
02:28:08.97	Sergio	Under the general liability program, the city's self-insured retention is half a million dollars per claim.
02:28:16.70	Sergio	So you would be self-insuring at any
02:28:19.81	Sergio	claims that fall underneath that amount and paying
02:28:23.97	Sergio	you know, a half million dollar deductible before Prism kicks in coverage.
02:28:28.44	Sergio	Um,
02:28:29.71	Sergio	And then on the workers comp again,
02:28:32.66	Sergio	your self-insured retention is $350,000 per claim.
02:28:38.50	Sergio	So I would not add the categories in that way.
02:28:42.47	Councilmember Hoffman	You would not what?
02:28:43.41	Sergio	I wouldn't add the categories because
02:28:43.48	Councilmember Hoffman	I wouldn't
02:28:45.13	Councilmember Hoffman	guys they're different but okay but collectively you would agree that it's eight hundred and seventy five thousand dollars in
02:28:51.21	Councilmember Hoffman	our total SIR going forward. And I agree that there's different categories and there's, you know,
02:28:56.54	Sergio	Yes, and I mean, there is a potential based on your loss history in any given year that
02:29:02.19	Sergio	You know, you may never get to
02:29:04.79	Sergio	you know, say in your workers comp program, you may never get to $350,000 that you're paying that year in SIRs.
02:29:11.07	Sergio	Yeah.
02:29:11.17	Councilmember Hoffman	.
02:29:11.90	Councilmember Hoffman	I just
02:29:12.77	Councilmember Hoffman	This number wasn't in the staff report, and I'm just trying to get us updated.
02:29:19.69	Councilmember Hoffman	So the total increase
02:29:23.32	Councilmember Hoffman	Total increase in premiums, no, yeah, in premiums from Bay City's.
02:29:30.65	Councilmember Hoffman	amongst all these categories moving forward.
02:29:34.24	Councilmember Hoffman	I think I had 1.365, but is that accurate, given these new categories that we just added in?
02:29:39.54	Sergio	So,
02:29:40.57	Sergio	I think that your figure for premiums is correct. That is what we're expecting to pay in premiums. Now, keep in mind that on top of the premium, you have to pay for the self-intrilled retention before coverage kicks in.
02:29:52.45	Sergio	You know, so.
02:29:54.54	Councilmember Hoffman	Right. So that's also an increase, sort of unknown increased costs, right? So that's the number that from zero to 500 in the general liability and zero from zero to 350 in the workers' comp and zero to 25,000 in the property category, anything under those numbers is
02:30:17.76	Councilmember Hoffman	the city will be responsible for paying those claims. Not just paying the claims, but also defending them in the legal costs.
02:30:25.03	Councilmember Hoffman	Yes.
02:30:25.29	Sergio	Yes, that's correct. And your cost of legal defense, those are going to go towards your SIR.
02:30:26.20	Councilmember Hoffman	Yeah.
02:30:31.95	Councilmember Hoffman	Okay.
02:30:34.43	Councilmember Hoffman	That's maybe the biggest risk factor with our insurance, other than the increase in payments, is the unknowable what it's going to cost us. And OK, thank you.
02:30:47.50	Mr. City Clerk	Any other, Councilman Kellman.
02:30:49.39	Councilmember Kelman	Yeah, so now I think it's the right time to go full circle on the questions that Councilmember Hoffman had asked about
02:30:54.65	Councilmember Kelman	the risk management strategy. And so I guess I noted that prepared by so you're turning but reviewed by
02:31:01.33	Councilmember Kelman	City Manager and the Finance Director,
02:31:04.74	Councilmember Kelman	I'm wondering if someone from a narrative perspective can disconnect the dots. So we went to Prism.
02:31:08.76	Councilmember Kelman	They said that in six months we come back to them.
02:31:11.58	Councilmember Kelman	with a list of things that we've completed, then we may enjoy a lower premium next year.
02:31:17.99	Councilmember Kelman	Where's the work plan?
02:31:19.91	Councilmember Kelman	for us to achieve those things and how are they baked into our budget?
02:31:25.16	Sergio	So,
02:31:26.53	Sergio	As part of becoming a new member of PRISM, PRISM requires that new members undergo an evaluation and claims audit during their first year.
02:31:35.74	Sergio	So that is a requirement. We will be going through that.
02:31:39.05	Sergio	Um,
02:31:40.30	Sergio	Additionally, as part of the
02:31:42.76	Sergio	excess workers comp program, we're required to hire a third party administrator
02:31:48.25	Sergio	to administer the claims process and adjust claims. Prism has a recommended list of third party administrators that the city is presently evaluating. Typically in the workers comp,
02:32:01.02	Sergio	program. Those are administered on a per-claim basis. So, you know, we're relying on PRISM in terms of
02:32:08.38	Sergio	Um,
02:32:09.47	Sergio	getting the professional assistance and the institutional capacity to
02:32:14.64	Sergio	you know,
02:32:15.38	Sergio	adequately run that program and
02:32:18.92	Sergio	Additionally, city staff have reached out to prism in terms of hiring consultants or an interim risk manager, while the city is trying to recruit a full time risk manager so we're leveraging the resources that we would get as a new member of prism to try and improve our risk management practices. we're going to follow you know.
02:32:40.66	Sergio	I assume we're going to follow all of the recommended practices that PRISM is going to give us unless we find a way to do it.
02:32:47.42	Sergio	better or more innovatively ourselves. But we're gonna start with what
02:32:52.32	Sergio	you know, evaluating what they recommend and seeing if that's the best fit for the city.
02:32:58.65	Sergio	Um,
02:32:59.91	Sergio	So again, we're starting as a new member
02:33:03.62	Sergio	We're looking at the resources that are available as part of the largest pool in California and we're going to
02:33:10.59	Sergio	leverage them as best as possible. So already we're conducting interviews for TPAs this week. We've reached out to all of the TPAs that are on
02:33:19.01	Sergio	Prism's recommended list. Additionally, these DPAs sometimes specialize in placing in-house risk manager candidates inside of public agencies. So we're seeing those as potential options and evaluating them.
02:33:32.82	Sergio	And then,
02:33:34.69	Sergio	I think in terms of
02:33:36.36	Sergio	addressing the claims history and you know the loss run again
02:33:41.88	Sergio	once the city has a risk manager in place or outside consultant or in or in person, you know, we're going to start tackling,
02:33:49.31	Sergio	Uh,
02:33:50.54	Sergio	reviewing doing a comprehensive review of department policies and practices to see that we're
02:33:55.82	Sergio	doing the most that we can to lower risk,
02:33:58.98	Sergio	I think additionally,
02:34:00.56	Sergio	you know, one of the issues that
02:34:03.53	Sergio	the city is being very proactive on is
02:34:06.62	Sergio	funding infrastructure improvement. And I think...
02:34:10.57	Sergio	Again, we're going to need to be looking at prioritizing our infrastructure projects based on the likelihood of claims, you know, focusing on areas where there's high utilization by the public, ensuring that those areas are addressed first in terms of public improvements, accessibility, and, you know, any sort of
02:34:31.41	Sergio	dangerous conditions or deficiencies. So those are all practices that I think
02:34:35.76	Sergio	are going to be
02:34:36.94	Sergio	Thank you.
02:34:36.98	Sergio	put into place or already being worked on.
02:34:40.39	City Manager	I can add to that, Mayor and Council, if I can. Besides the risk manager and working on infrastructure, the Miller Pacific study that talked about what we do with hillsides and land use regulations, it would help mitigate those types of issues. That's one, making sure that we move at speed for work toward consolidating the sewer enterprise. And then, obviously, when we talk about infrastructure funding, trying to find more funding for infrastructure beyond what we currently have in the capital improvement program. So those are the ones that we presented to the underwriting committee. You know, they're a roadmap. There's obviously more we'll get when we get a professional person looking under the hood of our city. And then we can get bigger and better in terms of our approach and our plan, and we'll have to prove that and show that to PRISM at six months. So we're already taking and notating and documenting all the things that we have to do and are doing with respect to anything that's PRISM-related so we can report out every month to ourselves and then consolidate that into a six-month report to the PRISM board.
02:35:51.06	Councilmember Kelman	So if I may follow up, Mayor. So, um...
02:35:54.42	Councilmember Kelman	two follow-up questions. So one is under the fiscal impact on the staff report. Should this more appropriately include the hiring of the risk manager as a full-time position as part of the fiscal impact on this measure? Is that appropriate?
02:36:11.17	Councilmember Kelman	Vice Mayor, you're shaking your head no. I don't know. This is a question. Chad, how should we be?
02:36:16.20	Unknown	to the community.
02:36:16.83	Sandra Bushmaker	So,
02:36:16.90	Unknown	I think we're a risk manager not just to please PRISM, but to actually, it's a holistic effort to address various things across the city that will result hopefully in lower premiums, but I don't believe it's solely related to our membership program.
02:36:16.96	Sandra Bushmaker	Yeah, so I think we're...
02:36:19.04	Sandra Bushmaker	Yeah.
02:36:33.15	Councilmember Kelman	Thank you.
02:36:33.16	Unknown	Sure. Although required by it.
02:36:34.97	Councilmember Kelman	So I totally have no
02:36:37.92	Councilmember Kelman	I totally get that. I think what I'm trying to understand is from a budgeting perspective,
02:36:43.46	Councilmember Kelman	Is it all hands on deck?
02:36:45.67	Councilmember Kelman	to meet what PRISM may be looking for, in which case should we be considering
02:36:50.73	Councilmember Kelman	authorizing Kathy to go to a higher amount to
02:36:54.90	Councilmember Kelman	hire the best person post haste so that we have the plan that the city manager managed. So we're not connecting. For me, the dots are not getting connected in terms of we're saying in six months, we want to go back. But I'm not seeing the path to get there unless we do X, Y, or Z. And so I want this council to have a conversation about...
02:37:16.63	Councilmember Kelman	the absolute priorities
02:37:18.59	Councilmember Kelman	that must be undertaken
02:37:20.90	Councilmember Kelman	to mitigate our risk. So if that means hire the risk manager, then if nothing else today, we should have a conversation about what Kathy needs to make sure that that happens, because we've been trying.
02:37:28.97	Councilmember Kelman	We haven't been able to do it.
02:37:30.99	Councilmember Kelman	I don't know why I should think we should be able to do it unless we do something differently. And so that's, I'm trying to figure out how do we,
02:37:38.23	Councilmember Kelman	plan for this.
02:37:40.33	Councilmember Kelman	I don't know if this is tautological, but I am trying to be linear.
02:37:43.60	Councilmember Hoffman	I think.
02:37:44.16	Councilmember Hoffman	Yeah, if I could weigh in on that. I think that's...
02:37:47.28	Councilmember Hoffman	Oh, I...
02:37:47.70	Mr. City Clerk	Yeah, I do want to try to move us along. I appreciate that slid into a bit of a comment. That was fine. That was fine. There was a question in there. Good. Do you feel like you understand the question?
02:37:52.44	Unknown	I'm going to go.
02:37:52.48	Councilmember Hoffman	that.
02:37:52.68	Unknown	I'm not sure.
02:37:55.23	Unknown	Thank you.
02:37:55.24	Unknown	Good.
02:37:59.41	Unknown	Well, isn't it true that we're right now hiring a temporary risk manager, a retired, the city manager said this earlier, a retired risk manager.
02:38:07.58	Mr. City Clerk	Mm-hmm.
02:38:07.86	Unknown	Thank you.
02:38:09.47	Unknown	risk manager who will work for us on a part-time basis to see us through until we're able to recruit and hire the risk manager of our choice. Isn't that true?
02:38:21.03	Kathy Nikitas	Yes, that is correct. We've gotten a scope of work from him this morning, and we're putting that in place so that we can have that framework
02:38:31.76	Kathy Nikitas	ready for when we do bring in a full-time person who we,
02:38:34.92	Kathy Nikitas	You know, we're going to keep trying and we're going to try harder and harder.
02:38:38.59	Kathy Nikitas	but,
02:38:39.71	Kathy Nikitas	having this person on board in the interim
02:38:43.18	Kathy Nikitas	will help us set the framework so that when we do bring someone on full time, they won't be starting
02:38:48.15	Kathy Nikitas	starting from scratch and saying, what should I do first? This is going to be helping us tailor, get our program ready for a full-time person.
02:38:57.97	City Manager	person and this person came to us through contact with prison
02:39:03.42	City Manager	Okay.
02:39:03.97	Mr. City Clerk	Other questions?
02:39:04.38	City Manager	Thank you.
02:39:04.48	Mr. City Clerk	Thank you.
02:39:05.75	Mr. City Clerk	And...
02:39:05.78	Unknown	AN INSTITUTION.
02:39:05.86	Mr. City Clerk	Vice Mayor?
02:39:05.88	Unknown	Thank you.
02:39:06.22	Unknown	In terms of the work plan, isn't it true that the real essence of the work plan is your email to PRISM? That is our work plan, and we are expanding upon that with advice from our temporary risk manager. There are other things we're doing that aren't even in that work plan, like requiring event participants to provide certificates of insurance for all of our various events, maintaining insurance, historical insurance. We didn't allow them to buy us out. And then I asked Council Member Kelman earlier this evening for the identity of the excess risk program
02:39:43.61	Unknown	Parametric. So we're considering parametric. So I believe we already have a work plan.
02:39:48.42	Unknown	well underway.
02:39:49.72	Unknown	But I do agree with Councilmember Kelman about the importance of reporting back to us on progress. And making sure we fund it.
02:39:58.31	Unknown	Yeah.
02:39:58.70	Mr. City Clerk	Yep.
02:39:59.41	Mr. City Clerk	Any other questions? All right, let's do public comment, Mr. City Clerk.
02:40:04.98	Babette McDougall	Bye-bye. Would you like to...
02:40:06.19	Mr. City Clerk	Any comments from the audience?
02:40:09.53	Mr. City Clerk	Thank you.
02:40:09.57	Babette McDougall	Same.
02:40:09.92	Mr. City Clerk	Any online?
02:40:11.52	Babette McDougall	seen a scene then
02:40:13.13	Mr. City Clerk	All right, we'll close by the comment.
02:40:15.71	Mr. City Clerk	We make a motion.
02:40:16.50	Unknown	Yes, I move. We adopt the resolution of the City Council of the City of Sausalito to join.
02:40:22.73	Unknown	Public Risk Innovation Solutions and Management, PRISM.
02:40:26.92	Unknown	Authorize the city manager to approve all program documents related to GL1, excess workers' comp, and property programs, and clarify that we are indeed joining the PRISM workers' comp plan, not the state fund, not state compensation insurance fund. And then separately, I would like to give direction that the city manager continue to, and staff continue to explore
02:40:51.72	Unknown	parametric and continue to implement the list of ongoing the work plan that was already provided by the city manager to prison and that persuaded them to hire us.
02:41:05.93	Mr. City Clerk	Is there a second? Second. All right. Madison Maiden second. Any discussion? Yes, please. Councilmember Cohen.
02:41:07.08	Unknown	Again.
02:41:09.84	Unknown	Thank you.
02:41:09.86	Councilmember Kelman	I suppose
02:41:10.15	Unknown	Thank you.
02:41:11.23	Councilmember Kelman	I would like to add the additional direction that we get some type of budget estimates associated with the work plan so that when we hit the mid-year budget, we know what it is we should be thinking about and allocating money towards in order to achieve that work plan. So thank you, Vice Mayor, for sharing with the public and reminding me that that existed. And I just want to make sure that we know what it will cost and then we can prioritize that in that mid-year budget review.
02:41:41.06	Mr. City Clerk	I assume no objection to that direction, Vice Mayor? No. I wholly endorse it. Any other comments? Yes, Council Member Kaufman.
02:41:44.29	Councilmember Kelman	Yeah. Then that's it.
02:41:45.03	Councilmember Hoffman	I wholly endorse it.
02:41:50.80	Councilmember Hoffman	So,
02:41:52.50	Councilmember Hoffman	Who's Council Member Kaufman? Hoffman. That's what he meant to say, Hoffman. Council Member Kellman and I are not the same person. Anyway, so, okay, so breathe full circle, right? So here we go. So our total SIR, different categories, right? I understand that. But total is $875,000 annually.
02:41:53.43	Unknown	Have a hard time.
02:41:53.97	Mr. City Clerk	I'm not going to talk.
02:41:54.70	City Manager	Thank you.
02:42:02.46	City Manager	Bye.
02:42:17.36	Councilmember Hoffman	And so we've had we've got to set aside and it goes this goes back to the reserve or how we're going to address this. We have a set aside SIR at about a million. Right. So what we're budgeting for. Well, what we're addressing right now with the way we've set up our budget is that we have about enough for one excess one claim a year in excess of the SIR per category.
02:42:43.72	Councilmember Hoffman	And.
02:42:44.72	Councilmember Hoffman	probably not the litigation costs that would be associated with each one of those high claims, because by definition, if it's a high claim, it's a complex case. So that, you know, that causes me concern at a time when we're at additional risk anyway with our budget with regard to
02:43:02.40	Councilmember Hoffman	unknowables in how many claims we might have
02:43:07.26	Councilmember Hoffman	that are not going to be that are going to be below our
02:43:11.45	Councilmember Hoffman	that's the other side, that are going to be below the self-insured level, right? So in other words, all the claims below $500,000, what that volume is going to be, what the cost is going to be to address those, to defend those claims. And so you have a reserve to address risk. I mean, that's why you have a reserve. So my concern is that was my point and my concern about the discussion of the reserve and why I think it would have been more fruitful for us to have had that discussion after this discussion. And otherwise I support, I mean, I support this obviously. I don't think we have a choice. Good, you know, great job, great job by the staff.
02:43:58.63	Councilmember Hoffman	in really, um,
02:44:00.77	Councilmember Hoffman	you know, a tremendous amount of work. And I understand it was a tremendous amount of work right up until
02:44:06.12	Councilmember Hoffman	this afternoon about what our costs were going to be. So thanks to everybody who worked on that.
02:44:13.83	Mr. City Clerk	Thank you for your comments. So I'll call the question all in favor of the vice mayor's motion.
02:44:18.46	Councilmember Hoffman	Thank you.
02:44:18.47	Unknown	Bye.
02:44:19.30	Mr. City Clerk	Bye.
02:44:20.28	Mr. City Clerk	All opposed motion carries unanimously. The last item on today's business agenda is adopt a resolution authorizing application to the director of industrial relations state of California for a certificate of consent to self insure workers compensation liabilities. Is that a city attorney city?
02:44:39.18	Sergio	Yeah, I'll handle this one as well. So this agenda item is being brought to you tonight as part of your decision to join PRISM's Excess Workers Compensation Program.
02:44:50.42	Sergio	Because it's an excess program, meaning that it only pays after the $350,000 SIR is triggered, the city is self-managing and self-insuring claims that fall underneath that SIR. One of the regulatory requirements is that the city has to actually receive approval from the Director of Industrial Relations in order to have a self-insured program for workers' compensation in California. This authorizes the city to file the application that would be necessary to
02:45:25.82	Sergio	Uh,
02:45:26.67	Sergio	undertake that program. So with that, I'll take any questions.
02:45:30.95	Mr. City Clerk	Any questions for our city attorney?
02:45:34.80	Mr. City Clerk	All right, no questions. Can we take public comment, Mr. City Clerk? There was one comment from the audience.
02:45:40.28	Babette McDougall	You have Babette McDougall?
02:45:48.64	Miss McDougal	Thank you, and I'm glad that the city attorney is standing by.
02:45:53.97	Miss McDougal	Once again, the devil is in the details, and once again,
02:45:58.00	Miss McDougal	We are living in the here and now, where we are transitioning along the calendar year
02:46:05.21	Miss McDougal	And we have all manner of risk exposure now. The reason why we are looking at this workers' comp
02:46:13.58	Miss McDougal	situation now is because
02:46:16.97	Miss McDougal	somehow our city took the eye off the risk management ball.
02:46:23.09	Miss McDougal	And the amount of litigation now facing us has become so unbearable that we got dropped.
02:46:30.47	Miss McDougal	from an insurance pool that we helped start.
02:46:33.54	Miss McDougal	That's pretty bad.
02:46:34.86	Miss McDougal	So, I mean, this cannot be a more moment of inflection than where we sit now and the future of this community and its well-being. So I'd like to urge you to just think carefully. Of course, we have to cooperate. We have to do what is necessary. I'd like to commend the city manager and his team for trying to pull together how to keep a ship from sinking.
02:46:59.23	Miss McDougal	because in a sense, that's what would be happening to us. And I'd like to, again, applaud each council person.
02:47:05.99	Miss McDougal	And I hate to keep pointing to Ms. Hoffman, but let's face it, you really have to think seriously about the exposure of,
02:47:13.47	Miss McDougal	the financial exposure to the citizens and to the city
02:47:16.99	Miss McDougal	If everything goes sideways,
02:47:20.23	Miss McDougal	and we already have a significant amount of litigation costs facing us.
02:47:24.33	Miss McDougal	These issues have to be very carefully thought about.
02:47:29.43	Miss McDougal	And I don't see any choice except to go with the recommended actions.
02:47:33.19	Miss McDougal	that the manager and his team have put before us.
02:47:36.52	Miss McDougal	in the short term, but in the long term, I think we need to get serious about the risk issue.
02:47:41.80	Miss McDougal	Thank you.
02:47:43.32	Mr. City Clerk	Is there any other online city?
02:47:45.97	Mr. City Clerk	clerk comments cnn all right we'll close city comments uh city we'll close public comments is there any are there any uh comments here discussion on the dice
02:47:54.71	Unknown	Mayor Mrakas- Mayor i'll make a motion that we adopt a resolution authorizing application to the director of industrial relations state of California for a certificate of consent to self ensure workers compensation liabilities in. Mayor Mrakas- conjunction with the motion that we just made to join prison under those circumstances.
02:48:15.79	Mr. City Clerk	Is there a second?
02:48:16.82	Councilmember Kelman	I'll second.
02:48:17.66	Councilmember Kelman	But I will also note by way of conversation that there was at least one, and I support this suggestion, that do schedule another meeting to talk strategically around the risk management spend and strategies for that. I think Council Member Hoffman, it was you that brought that up, and I support that. So if my colleagues are interested or available, I'm happy to participate.
02:48:41.40	Mr. City Clerk	Thank you. Motions made, seconded, any other discussion?
02:48:46.43	Mr. City Clerk	All right, we'll call the question all in favor. Say aye.
02:48:48.73	Councilmember Blustein	Bye.
02:48:49.25	Mr. City Clerk	Thank you.
02:48:49.33	Mr. City Clerk	Opposed?
02:48:50.77	Mr. City Clerk	motion carries unanimously on the next action is adjournment and our next regular meeting will be held on July the 16th at approximately 7pm. But before then we'll have fourth of July, so I wish everyone a very happy fourth of July celebrating our parade and our talent and our country for which we are immensely grateful good night be well and see you on the fourth.

City Council Jun 25, 2024

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