>> ALL RIGHT, COLLEAGUES. WE ARE GOING TO GET STARTED.
[Finance Committee on October 21, 2025.]
[00:00:03]
IT IS 1:03 ON THE AFTERNOON ON TUESDAY, OCTOBER 21ST.I WANT TO WELCOME YOU TO THE INAUGURAL MEETING OF THE FINANCE COMMITTEE, WHICH HAS FOR THE MOST PART, REPLACED GOVERNMENT PERFORMANCE FINANCIAL MANAGEMENT.
I WANT TO START OFF BY THANKING MAYOR JOHNSON FOR APPOINTING ME AS CHAIR OF THIS NEW COMMITTEE.
I WANT TO ALSO THANK THE MAYOR FOR PROVIDING ME WITH SUCH A GREAT GROUP OF COMMITTEE MEMBERS.
MY COLLEAGUES TO TACKLE THESE IMPORTANT FINANCIAL QUESTIONS, WHICH ARE GOING TO BE KEY TO THE LONG-TERM HEALTH AND SUSTAINABILITY OF OUR CITY.
I'M GOING TO READ THE POLICY PRIORITY THE MAYOR GAVE US IN HIS MEMO.
DETERMINE WHETHER DALLAS CITY HALL AND OTHER MUNICIPAL FACILITIES EFFECTIVELY SUPPORT CITY OPERATIONS AND BEST SERVE THE CITIZENS OF DALLAS.
CONSIDER ALL POTENTIAL OPTIONS AND IDENTIFY THE MOST FISCALLY RESPONSIBLE COURSE TO ADDRESS THE MOUNTING DEFERRED MAINTENANCE AND CARRYING COSTS OF DALLAS CITY HALL.
THAT'S THE ONLY THING ACTUALLY THAT WAS SAID IN THE MAYOR'S MEMO.
IF THAT SHOWS YOU AN INDICATION OF WHERE OUR FOCUS SHOULD BE RIGHT NOW.
MANY OF THESE CONVERSATIONS ABOUT REAL ESTATE, WHICH WE BEGAN TWO YEARS AGO IN GPFM, WILL CONTINUE WHAT WE HAD PREVIOUSLY STARTED.
WE'LL TAKE ON FORMER GPFM TOPICS SUCH AS AUDITS, FINANCIAL FORECASTS, AND TECHNOLOGY AS WELL.
IT WILL ALSO BE ON THIS COMMITTEE TO FOCUS ON BUILDING A REAL ESTATE STRATEGIC PLAN WITH CITY STAFF, FINDING AVENUES WITHIN THE CITY'S REAL ESTATE PORTFOLIO FOR ADDITIONAL REVENUE GENERATION, AND ADDRESSING DEFERRED MAINTENANCE COSTS, AND LASTLY, REVIEWING THE CITY'S ENTIRE BOOK OF REAL ESTATE OF 50,000 ACRES, INCLUDING FIRST AND FOREMOST DALLAS CITY HALL.
WE'RE GOING TO COME BACK TO THE CITY HALL DISCUSSION.
THAT'S COMING UP VERY QUICKLY, BUT I DO WANT TO TAKE UP ITEM G FIRST SINCE WE HAVE OUR ENTIRE AUDIT TEAM HERE, AND I DO NOT ANTICIPATE A LOT OF QUESTIONS FOR THEM THIS MONTH, ALTHOUGH I THINK NEXT MONTH, YOU'LL BE PRETTY BUSY WITH US.
COLLEAGUES, DO YOU HAVE ANY QUESTIONS REGARDING THE OFFICE OF THE CITY AUDITOR MONTHLY INTERNAL UPDATE ON INTERNAL AUDIT REPORTS, ITEM G. I THINK WE'RE GOOD.
THANK YOU. YOU GUYS CAN HANG OUT AND WATCH THIS OR TAKE OFF, IF YOU LIKE.
NEXT, COLLEAGUES, WE'RE THROUGH THAT ITEM.
WE'RE GOING TO MOVE ON TO ITEM A.
BEFORE WE START, I WANT TO REMIND COMMITTEE MEMBERS THAT THE TOPIC IS, "STATE OF DALLAS CITY HALL," SO I'M NORMALLY PRETTY FLEXIBLE ON LETTING QUESTIONS AND DISCUSSION GO A LITTLE OFF THE RAILS, BUT I THINK THIS IS GOING TO BE A VERY LENGTHY CONVERSATION, IS A VERY IMPORTANT ONE.
WE REALLY NEED TO STAY IN THE REALM OF BEING GERMANE.
UNLIKE THE WAY I USUALLY CONDUCT MEETINGS, I AM GOING TO CALL THAT OUT IF I NEED TO IN THIS SITUATION.
WE'RE NOT HERE TO DISCUSS ANY PROPOSALS FOR THE CITY HALL SITE IF DALLAS WERE TO VACATE THE SITE.
TODAY, WE'RE SIMPLY DISCUSSING WHAT'S IN THE BEST INTEREST OF TAXPAYERS WHEN IT COMES TO CITY HALL.
THE FINANCIAL IMPLICATIONS OF STAYING IF WE DO DETERMINE THAT WE'RE GOING TO STAY HERE OR IF WE GO. THIS IS A JOURNEY.
IT'S NOT A DECISION WE HAVE TO MAKE TODAY, NECESSARILY.
I KNOW WE'RE GOING TO HAVE A LOT OF QUESTIONS.
AT THIS POINT, I'M GOING TO TURN IT OVER TO ASSISTANT CITY MANAGER DONZELL GIPSON. TAKE IT AWAY.
>> THANK YOU, CHAD WEST FOR THAT INTRODUCTION.
TODAY, DIRECTOR JOHNSON IS GOING TO WALK US THROUGH TODAY'S BRIEFING.
I'M JUST GOING TO DO A REAL FAST INTRO AND THEN I'M GOING TO TURN IT OVER TO DIRECTOR JOHNSON.
HE'S GOING TO WALK US THROUGH HOW WE GOT HERE AND THE URGENCY OF THE NEED THAT YOU'RE GOING TO BE ADDRESSING TODAY.
HE'S GOING TO OUTLINE THE SUBSTANTIAL COSTS ASSOCIATED WITH THAT NEED AND OUR BEST ESTIMATES THAT WE HAVE AND WHAT DATA THAT WE HAVE RELATIVE TO THOSE DEFERRED MAINTENANCE NEEDS HERE AT CITY HALL.
THEN THIRD, HE'S GOING TO DESCRIBE A SERIES OF OPTIONS AND CONSIDERATIONS THAT THE CITY COUNCIL WILL NEED TO CONSIDER WHEN EFFECTIVELY REVIEWING AND MAKING ASSESSMENTS ABOUT THE FUTURE OF CITY HALL.
THEN FOURTH, WE'RE GOING TO FINALIZE BY HAVING A DISCUSSION ANY FEEDBACK THAT YOU GUYS WOULD HAVE, INCLUDING ANY ADDITIONAL INFORMATION THAT THE COUNCIL WILL NEED TO MAKE THOSE CONSIDERATIONS.
JOHN, I'M GOING TO TURN IT OVER TO YOU.
>> THANK YOU, DONS. GOOD AFTERNOON COMMITTEE.
ONE, WE'RE GOING TO START TODAY ON SLIDE 3 WITH THE PURPOSE OF OUR BRIEFING.
THAT IS TODAY TO PROVIDE THE CITY COUNCIL WITH HISTORICAL CONTEXT OF DALLAS CITY HALL, REVIEW ITS KEY FUNCTIONS AND CURRENT USES, HIGHLIGHT DEFERRED AND MAJOR MAINTENANCE NEEDS, DISCUSS THE OPERATIONAL REALITIES OF THE FACILITY AND ITS CURRENT CONDITION, AND RECEIVE FEEDBACK FROM THE COUNCIL ON NEXT STEPS.
FOR CONTEXT, WE PROVIDED SOME HISTORY AND ORIGINS OF CITY HALL ON SLIDE 4.
FROM THE PROJECTS INCEPTION TO REALITY, IT WAS ABOUT 13 YEARS TOTAL.
[00:05:01]
CONSTRUCTION OCCURRING IN THREE PHASES TOOK APPROXIMATELY SIX YEARS TO COMPLETE WITH THE FORMAL OPENING AND DEDICATION TAKING PLACE ON MARCH 12TH OF 1978.THE FIRST COUNCIL MEETING WAS HELD ON FEBRUARY THE 1ST, 1978, AND TODAY, DALLAS CITY HALL SERVES AS THE SEAT OF MUNICIPAL GOVERNMENT.
IT HOSTS CITY COUNCIL MEETINGS, BOARDS AND COMMISSIONS, AND VARIOUS CIVIC AND CEREMONIAL EVENTS.
WHEN WE LOOK AT IT BY THE NUMBERS, THE BUILDING IS APPROXIMATELY 47-YEARS-OLD, COMPRISES 1 MILLION TOTAL SQUARE FEET OF WHICH AROUND 411 IS DEDICATED OFFICE SPACE.
IT HOUSES APPROXIMATELY 2,200 CITY STAFF THAT SERVE IN VARIOUS ROLES AND FUNCTIONS, SUPPORTING 26 CITY DEPARTMENTS, AND WE HAVE A TOTAL OF AROUND 1,500 TOTAL PARKING SPOTS.
MOVING NOW TO DEFERRED MAINTENANCE, IT IS NO SECRET THAT THE CITY HAS UNDERINVESTED IN MAJOR MAINTENANCE, AND OVER DECADES, THIS HAS RESULTED IN A BACKLOG OF DEFERRED NEEDS.
CITY HALL HAS NOT BEEN INCLUDED IN RECENT BOND PROGRAMS. THE FOLLOWING SLIDE THAT WE'RE GOING TO SHOW DETAILS CITY HALL'S KNOWN NEEDS FOR DEFERRED MAINTENANCE, AND THEY ARE HIGH LEVEL RANGE ESTIMATES ONLY.
IT IS NOT A COMPREHENSIVE LIST, AND IT HAS BEEN PROVIDED TO COMMUNICATE THE POSSIBLE ORDER OF MAGNITUDE OF THE INVESTMENT REQUIRED.
YOU'LL NOTICE THAT SOME OF THE RANGES ARE QUITE BROAD.
AGAIN, THAT'S BECAUSE THEY'RE THE ROUGH ORDER OF MAGNITUDE ESTIMATES, MEANT TO SHOW POTENTIAL INVESTMENT LEVELS RATHER THAN EXACT COSTS.
NEEDS OF NOTE INCLUDE HVAC, WATER INFILTRATION, GARAGE STRUCTURAL, FIRE SUPPRESSION, AND EMERGENCY GENERATORS.
THE MINIMUM ESTIMATE GENERALLY ASSUMES LIMITED OR TARGETED REPAIRS WHILE THE HIGHER END REFLECTS A FULL SYSTEM REPLACEMENT.
IN MANY CASES, BRINGING THESE SYSTEMS OR SPACES UP TO CURRENT BUILDING CODE WOULD ADD ADDITIONAL COSTS BEYOND WHAT'S SHOWN IN THE MINIMUM REPAIR.
SLIDE 8 NOW SHOWS SOME RECENT EXAMPLES OF GARAGE AND INTERIOR WATER INFILTRATION ISSUES.
I'M GOING TO MOVE QUICKLY THROUGH THE PHOTOS.
NOW SLIDE 9 SHOWS INTERIOR WATER INFILTRATION OVER TELECOMMUNICATIONS AREAS, THE NOW FAILED INTERIOR GUTTER SYSTEM, AND WATER INFILTRATION OVER ELECTRICAL INFRASTRUCTURE IN THE PARKING GARAGE.
ON SLIDE 10, WE'VE SHOWN SOME EXAMPLES OF WATER INFILTRATION FROM THE ROOF, ACTIVE WATER INFILTRATION IN THE GARAGE, AGAIN, SHOWING THE FAILED GUTTER SYSTEM, AND A FAILED STORM DRAIN IN THE PLAZA.
SLIDE 11, WE PROVIDE ADDITIONAL EXAMPLES OF WATER INFILTRATION AND SOME ANTIQUATED HVAC SYSTEMS THAT ARE LOCATED ON THE 8TH FLOOR IN THE MECHANICAL SPACE.
MOVING NOW TO SLIDE 12, WE SEE OBSOLETE AND NON COMPLIANT ELECTRICAL INFRASTRUCTURE, A NON-FUNCTIONAL AND OBSOLETE GENERATOR, AND NON-COMPLIANT RESTROOM FACILITIES THAT ARE WELL PAST THEIR SERVICEABLE LIFE.
NOW WE SWITCH GEARS TO SOME REPAIRS.
ON SLIDE 13, THIS PROVIDES PHOTOS OF A PREVIOUS GARAGE STRUCTURAL EMERGENCY REPAIR THAT WAS COMPLETED DURING 2020.
YOU'LL SEE THAT THERE WAS SOME CRACKING AND CONCRETE SPALLING THAT HAD TO BE REPAIRED.
ON SLIDE 14, WE SHOW SOME PHOTOS FROM THE RECENT MAY PLUMBING FAILURE, WHICH, AS YOU KNOW, FLOODED MULTIPLE FLOORS, INCLUDING THE CITY MANAGER'S OFFICE AND COUNCIL CHAMBERS.
MOVING ON TO SOME PREVIOUS DUE DILIGENCE IN THIS BUILDING, AS CHAD WEST MENTIONED, BEGINNING IN 2023, WITH A DIRECTIVE FROM GPFM, STAFF WAS TASKED WITH IMPROVING BUILDING UTILIZATION AND STEWARDSHIP OF OUR ASSETS.
ONE OF THE PROJECTS WAS FOCUSED ON CITY HALL AND OCMC, AND A DESIGN AND ENGINEERING FIRM WAS ENGAGED TO EVALUATE THE FEASIBILITY OF CONSOLIDATION INTO CITY HALL.
AFTER THE FIRM COMPLETED ITS REVIEW, STAFF WERE MADE AWARE OF A NUMBER OF CONSTRAINTS RELATED TO THE POTENTIAL CONSOLIDATION OF OPERATIONS INTO CITY HALL, AND THOSE INCLUDED A LACK OF AVAILABLE SPACE, RESTROOMS AND ADA COMPLIANCE, ELECTRICAL, HVAC, AND PLUMBING INFRASTRUCTURE DEFICIENCIES, AND PARKING CAPACITY.
MOVING NOW TO TODAY'S OPERATIONAL REALITY, CITY HALL GENERATES FREQUENT MAINTENANCE REQUESTS FROM VARIOUS STAKEHOLDERS.
THE REQUESTS VARY GREATLY, BUT THE TOP THREE ARE USUALLY PLUMBING, ELECTRICAL, AND HVAC, WITH ELEVATOR SERVING AS A RECENT HONORABLE MENTION.
WE DO OUR BEST TO MAKE REPAIRS WITHOUT IMPACTING OPERATIONS, BUT OFTENTIMES NOISE, VIBRATION, DUST AND ODORS PRESENT SECONDARY CHALLENGES, WHICH THEN GENERATE MORE MAINTENANCE REQUESTS.
THE LARGER THE PROJECT, THE MORE DISRUPTION IS TO BE EXPECTED, AND IN THE FUTURE, IF SOMETHING CATASTROPHIC MAY LIKELY OCCUR, THEN WE WOULD TEMPORARILY NEED TO CLOSE THE FACILITY.
CURRENTLY AND EVERY DAY, WE'RE SEEING THE REAL WORLD EFFECTS OF DEFERRED MAINTENANCE.
LIKE I MENTIONED, THE MAY MULTI-FLOOR FLOODING EVENT, THE DAILY POWER OUTAGES AROUND THIS VERY HORSESHOE.
WE HAVE OFTENTIMES FREEZING COUNCIL CHAMBERS AND SWELTERING CITY ATTORNEY'S OFFICE ON THE 7TH FLOOR IN THE SAME DAY.
[00:10:04]
THEN THERE ARE NON-COMPLIANT UNUSABLE SPACES LIKE THE 7TH FLOOR KITCHEN CAFETERIA.THE ISSUE IMPACTS NOT JUST THE BUILDING, BUT THE PEOPLE WHO RELY ON IT TO SERVE THE PUBLIC, AND WE ALREADY KNOW THAT EMERGENCY FIXES ARE MORE EXPENSIVE AND MORE DISRUPTIVE THAN THOSE THAT WE PLAN IN ADVANCE.
NOW LOOKING INTO THE FUTURE THROUGH OUR MAINTENANCE LENS, DEFERRED MAINTENANCE COMPOUNDS OVER TIME AND SMALL ISSUES BECOME LARGE ISSUES.
WITHOUT SIGNIFICANT INVESTMENT, FAILURES WILL BECOME MORE FREQUENT AND MORE EXPENSIVE TO FIX, WHICH DRAINS THE ALREADY LIMITED RESOURCES.
MOST MAJOR SYSTEMS ARE REACHING THE END OF THEIR USEFUL LIFE AND REPAIRS ALONE WON'T BE ABLE TO SUSTAIN THEM MUCH LONGER.
CRITICAL SYSTEMS LIKE HVAC AND ELECTRICAL ARE ALREADY AGED OUT AND SIGNIFICANT FAILURES WOULD DISRUPT CRITICAL SERVICE DELIVERY.
WE'VE REACHED THE POINT WHERE THE CITY MUST CHOOSE TO REINVEST OR ACCEPT THE GROWING RISK AND THE COST OF DEFERRED MAINTENANCE.
NOW THIS BRINGS US TO WHERE WE NEED COUNSEL DIRECTION AND FEEDBACK TO HELP GUIDE WHICH OPTION OR COMBINATION OF OPTIONS IS THE BEST LONG TERM COURSE.
STARTING WITH OPTION 1, WHICH IS TO MAINTAIN THE STATUS QUO.
WE DO OUR BEST TO STAY THE COURSE AND MAKE THE REPAIRS AS NEEDED, KNOWING THAT DEFERRED MAINTENANCE IS GROWING DAILY, AND FUTURE COSTLY FAILURES ARE INEVITABLE.
WE MUST ALSO ACCEPT THE GROWING RISK OF PROPERTY DAMAGE, SERVICE DISRUPTIONS, AND POTENTIAL TEMPORARY CLOSURE.
WHAT DOES OPTION 1 MEAN AND WHAT WOULD IT LOOK LIKE? IF WE CONTINUE WITH THE STATUS QUO AND OPERATE AS IS, WE ALREADY KNOW, THIS WILL LIKELY BE THE MOST EXPENSIVE AND DAMAGING OPTION OVER TIME AS COMPARED TO PLAN INVESTMENTS AND UPGRADES.
BECAUSE WE'RE MAINTAINING THE STATUS QUO AND REPAIRS HAPPEN ONLY AFTER FAILURES, WE REALLY CAN'T PREDICT THE COST OR THE FINANCIAL IMPACT.
THE NEXT OPTION FOR CITY COUNCIL CONSIDERATION, OPTION 2 IS TO PLAN AND FUND REPAIRS.
WE WOULD USE THE DATA FROM THE UPCOMING FACILITY CONDITION ASSESSMENT TO INFORM AND GUIDE FUTURE MAINTENANCE INVESTMENTS.
A FUNDING PLAN WOULD NEED TO BE DEVELOPED USING FUTURE BOND FUNDS, ASSET SALES, AND OR ANNUAL BUDGETS.
IF OPTION 2 WERE SELECTED, STAFF WOULD CONTINUE MOVING FORWARD WITH ITS UPCOMING FORMAL SOLICITATION TO AWARD AN FCA CONTRACT, AND ONCE AWARDED, IT IS PLANNED TO COVER 500 BUILDINGS AND TAKE ABOUT 18-24 MONTHS TO COMPLETE.
THIS PROCESS MAY ALSO UNCOVER OTHER CURRENTLY UNKNOWN NEEDS ADDING TO THE ESTIMATED REPAIR BILL AT CITY HALL.
WITH THE ROUGH ORDER OF MAGNITUDE ESTIMATES BETWEEN 152 MILLION AND 345, FINDING THAT LEVEL OF FUNDING WILL BE A CHALLENGE.
IT WOULD LIKELY REQUIRE A MIX OF SOURCES USING BOND FUNDS, OPERATING BUDGETS, AND PROCEEDS FROM THE SALE OF SURPLUS ASSETS.
COUNSEL WILL NEED TO WEIGH WHETHER TO REINVEST HERE OR CONSIDER ALTERNATIVES, WHICH WE WILL COVER IN OPTION 3.
SLIDE 23 PROVIDES A FINANCIAL SNAPSHOT OF MOVING FORWARD WITH OPTION 2, THE PLANET AND MAKE THE REPAIRS.
THIS ILLUSTRATES FINANCING $250 MILLION FOR DEFERRED MAINTENANCE, WHICH IS THE MEDIAN BETWEEN THE MINIMUM AND HIGH RANGES THAT WERE PROVIDED ON SLIDE 7.
LASTLY, OPTION 3, WHICH IS TO EXPLORE OTHER LONG TERM OPTIONS AND ALTERNATIVES AS DETERMINED BY CITY COUNCIL.
THESE COULD INCLUDE LEASING SPACE, SELLING, REDEVELOPING, OR UP TO AND INCLUDING CONSTRUCTING A NEW CITY HALL.
OPTION 3 LOOKS BEYOND REPAIRS TO SEE IF OTHER PATHS MIGHT BETTER SERVE THE CITY IN THE LONG RUN.
WE CAN LEARN FROM OTHERS WHO'VE GONE THROUGH SIMILAR CHALLENGES AND WHAT WORKED FOR THEM.
COUNCIL GUIDANCE WILL BE KEY, WHETHER THIS MEANS REINVESTING HERE, LEASING OR BUILDING NEW, OR CONSOLIDATING OPERATIONS ELSEWHERE.
OPTION 3 IS FOCUSED ON WHAT DELIVERS THE BEST VALUE FOR THE ORGANIZATION AND FOR THE TAXPAYER.
AS I MENTIONED, OTHER ORGANIZATIONS HAVE FACED SIMILAR CHALLENGES.
SLIDE 26 SHOWS A FEW CASE EXAMPLES THAT COULD HELP GUIDE OUR THINKING.THEN LASTLY, SLIDE 27 IS INCLUDED TO SHOW THAT THERE ARE AVAILABLE PROPERTIES IN DOWNTOWN WITH VACANCY, SHOULD THE COUNCIL DECIDE TO EXPLORE LEASING SPACE.
CHAIR, THAT'S THE END OF OUR PRESENTATION.
>> THANK YOU. WE'RE GOING TO GET INTO QUESTIONS HERE IN A SECOND.
FOR MY FOLKS WHO CAME IN A LITTLE BIT LATER, I JUST WANTED TO REMIND EVERYBODY ABOUT WHAT THE TOPIC IS TODAY.
THE MAIN FOCUS OF THIS TOPIC IS THE DEFERRED MAINTENANCE OF CITY HALL.
TO STAY GERMANE AND ON TOPIC, WE'RE GOING TO FOCUS ON THE DEFERRED MAINTENANCE ISSUES.
ANY ALTERNATIVES TO WHETHER WE STAY HERE OR GO, THE BUILDING ITSELF, INCLUDING PRESERVATION AND HISTORIC ISSUES AND ON CONSOLIDATION OF CITY RESOURCES.
WE'RE NOT REALLY GETTING INTO THE ECONOMICS OF WHAT COULD HAPPEN AT THIS PLAZA OR WHAT HAVE YOU, IF WE DID LEAVE.
BUT WE'RE GOING TO LIMIT IT TO THOSE INITIAL TOPICS I JUST MENTIONED.
[00:15:01]
WE HAVE THE OPTION TO GO TO EXECUTIVE SESSION AT ANY TIME, IF ANYBODY WOULD LIKE TO DO SO, TO ASK THE ATTORNEY SOME QUESTIONS.WITH THAT BEING SAID, I HAVE A COUPLE I'D LIKE TO TEE UP FOR QUESTION-WISE, AND THEN I'M GOING TO GO THIS WAY FOR COMMITTEE MEMBERS, AND THEN WE'LL GO THIS WAY FOR COMMITTEE MEMBERS AND THEN NON-COMMITTEE MEMBERS.
>> STAFF HAS BEEN ASKING CITY COUNCIL TO ADDRESS MAJOR DEFERRED MAINTENANCE ITEMS SINCE AT LEAST 2017 WHEN I SAT ON THE BOND TASK FORCE.
PROBABLY BEFORE THAT, I WOULD ASSUME.
BUT I REMEMBER 2017, DURING THE BOND DISCUSSIONS, THERE WERE SOME REQUESTS TO FUND CITY HALL MAINTENANCE.
WHAT WERE THE MAJOR ITEMS IN THE LAST BOND AND IN THE 2017 BOND THAT WERE REQUESTED TO BE FUNDED, AND DID WE FUND ANY OF THOSE?
>> SURE. I'LL TAKE THAT QUESTION.
THERE WERE APPROXIMATELY $61 MILLION IN NEEDS SUBMITTED TO THE COMMUNITY BOND TASK FORCE FOR CONSIDERATION THAT WOULD BE PASSED THROUGH TO THE COUNCIL.
THIS COVERED PROJECTS FOR ELECTRICAL GENERATORS, ROOF REPLACEMENT, FIRE SUPPRESSION, AND WATER INFILTRATION.
HOWEVER, ULTIMATELY, NONE OF THESE PROJECTS WERE INCLUDED IN THE COUNCIL APPROVED PROPOSITIONS.
THEN MOVING TO 2017, WHILE I DON'T HAVE A TOTAL FOR THE PROJECTS, THE ITEMS THAT WERE SUBMITTED FOR CONSIDERATION INCLUDED ELECTRICAL UPGRADES, REPLACEMENT OF THE DOMESTIC WATER LINES, HVAC COOLING TOWERS, AND ROOF REPLACEMENTS.
ALSO, NONE OF THOSE ITEMS WERE FUNDED.
>> AS WE SEE THE BIG BILL THAT YOU HAVE ON ONE OF YOUR EARLIER SLIDES THAT TALKS ABOUT THE PROJECTED TOTAL DEFERRED MAINTENANCE BILL OF 345 MILLION AT THE HIGH END.
WHY WOULD STAFF ONLY REQUEST A PORTION OF THAT DURING EACH OF THE BONDS INSTEAD OF THE FULL AMOUNT? DID YOU NOT KNOW THE FULL AMOUNT OF DEFERRED MAINTENANCE AT THE TIME OR WHY IS THERE A DISCREPANCY?
>> THANK YOU FOR THAT QUESTION, CHAIR WEST.
TYPICALLY, STAFF WILL ASK FOR A RANGE BASED ON THE CAPACITY.
THERE ARE A LOT OF COMPETING INTERESTS.
I HEARD YOU MENTION THAT YOU WERE ON ONE OF THE COMMUNITY TASK FORCE.
I'VE BEEN TO THOSE MEETINGS BEFORE.
IT IS VERY COMPETITIVE FOR CITY FACILITIES TO GO IN AND HAVE CONVERSATIONS WITH PEOPLE WHO ARE INTERESTED IN HAVING A NEW LIBRARY OR A RECREATION CENTER.
OR SOMETHING ELSE THAT PEOPLE MAY SEE AS SOMETHING AS MORE BRIGHT AND SHINY NEW ITEM VERSUS TAKING CARE OF SOME OF THE THINGS THAT THEY JUST MAYBE DON'T SEE EVERY DAY OR DON'T TOUCH OR FEEL EVERY DAY.
I'VE BEEN TO THOSE MEETINGS AND OFTEN TIMES PRIORITIES LIKE CITY FACILITIES, THEY JUST FALL TO THE BOTTOM.
>> WHAT ARE THE IMPLICATIONS OF US CONTINUING TO KICK THE CAN DOWN THE ROAD ON THE DEFERRED MAINTENANCE NEEDS? FOR EXAMPLE LIKE YOUR OPTION ONE SCENARIO, WHICH IS WE DO NOTHING AND JUST STAY HERE.
>> WELL, WE KNOW THAT DEFERRED MAINTENANCE COMPOUNDS OVER TIME.
IF WE DON'T MAKE ANY INVESTMENTS, THEY WILL CONTINUE TO HAVE REOCCURRING FAILURES THROUGHOUT THE BUILDING.
THEY WILL LIKELY GET WORSE AND BE MORE EXPENSIVE, AND DISRUPTIVE TO MAKE REPAIRS.
>> IF WE HAD TO PULL A PERMIT TOMORROW TO START ON REPAIRING CITY HALL, HOW WOULD THAT GO?
>> I THINK IT DEPENDS ON WHERE WE'RE GOING TO MAKE REPAIRS.
THERE ARE VERY LIMITED AREAS WHERE WE MIGHT BE IN COMPLIANCE WITH CODE, BUT THE MAJORITY WOULD NOT.
IN ORDER TO ADDRESS THE ISSUE THAT WE WERE PULLING THE PERMIT FOR, WE WOULD ALSO HAVE THIS SECONDARY AND ANCILLARY SET OF EXPENSES THAT WE WOULD BE REQUIRED TO MAKE UPGRADES JUST TO GET US TO THE MINIMUM CODE REQUIREMENT.
>> ONE OF THE THINGS THAT STUCK OUT TO ME IS IF WE STAY HERE.
WE'VE GOT TO ADDRESS PRETTY URGENTLY IS THE ADA UPGRADES THAT ARE NEEDED.
IT'S BEEN A PRIORITY OF THE MAYOR TO HAVE A DISABILITIES COMMISSION APPOINTED AND ACTIVE.
YET WE AREN'T EVEN A COMPLIANT BUILDING FOR OUR INDIVIDUALS WITH DISABILITIES.
THAT BILL IS PRETTY HEFTY AT 10 MILLION.
I'M GOING TO TURN IT OVER TO MY VICE CHAIR.
VERY HAPPY TO HAVE HER ON THE COMMITTEE. CHAIR STEWART.
I'M GOING TO START WITH THE VIDEO THAT'S AT THE END OF YOUR PRESENTATION AND THE EXPANSION JOINTS THAT WERE LEAKING WATER, THAT CITY HALL WAS ACTUALLY STILL UNDER CONSTRUCTION.
JUST A CLARIFICATION, ARE WE SAYING THAT THE WATER IN THE PARKING GARAGE HAS BEEN THERE LITERALLY SINCE THE BEGINNING?
>> WELL, I'M NOT ABLE TO PINPOINT AND SAY THE EXACT LOCATION IS THE SAME AS DETAILED IN THE 1976 VIDEO.
BUT WHAT I CAN TELL YOU IS THAT WHERE IT COMES THROUGH THE LOOK OF IT BUBBLING UP IN SOME LOCATIONS AND THEN DRIPPING IS EERILY SIMILAR TO EXACTLY WHAT WE SEE TODAY.
>> 1976 IS WHEN I GRADUATED FROM HIGH SCHOOL.
WE'RE TALKING A REALLY LONG TIME AGO.
THIS BRINGS ME TO SOME OF THE CRUX OF WHAT WE'VE GOT TO DECIDE.
[00:20:03]
CAN WE REPAIR THIS BUILDING TO THE POINT WHERE WE DON'T HAVE SAFETY RISK.WHERE IT IS FUNCTIONING BETTER, WHERE WE'RE MEETING CODE? I KNOW I'M ASKING YOU TO LOOK INTO A CRYSTAL BALL.
BUT DO YOU ALL BELIEVE THAT WE HAVE THE ABILITY TO MAKE SUFFICIENT REPAIRS BASED ON WHAT YOU'VE SEEN SO FAR?
>> I'LL TAKE THAT ONE. I THINK THAT'S A HARD QUESTION FOR US TO ANSWER.
BECAUSE I THINK THERE'S GOING TO BE A CASCADING EFFECT OF THINGS WHEN WE START MAKING REPAIRS TO THE BUILDING.
WE COULD GIVE YOU A $300 MILLION ESTIMATE TODAY, AND THE FIRST TIME THAT WE START HAMMERING INTO THESE OLD WALLS AND INTO THIS STRUCTURE.
WE COULD COME BACK TO THIS BODY AND SAY, WE JUST FOUND THAT WE NEED ANOTHER $50 MILLION WORTH OF CHANGE ORDERS FOR A WHOLE RANGE OF ISSUES THAT UNDER ANY CIRCUMSTANCES, WOULD WE HAVE KNOWN OR COULD HAVE KNOWN UNTIL WE STARTED THE WORK.
I WOULDN'T WANT TO ASK COUNSEL FOR A BLANK CHECK ON THIS BUILDING.
MEANING TO SAY THAT JOHN AND I, WE'RE VERY COMFORTABLE WITH THE ESTIMATES AND THE RANGE THAT WE'VE PROVIDED.
BUT THERE'S SO MANY UNKNOWNS THAT I'D HATE TO DO THAT AND START ON A PROJECT.
THEN WE JUST NOT KNOW WHEN WE'D BE DONE WITH THE FINANCING OF IT.
>> I AGREE WITH YOU. I DON'T KNOW OF A REMODELING PROJECT OR A REPAIR PROJECT THAT'S EVER STARTED AND FINISHED ON BUDGET.
WHEN YOU OPEN UP WALLS AND YOU START LOOKING AT PLUMBING OR THE PART OF THE BUILDING THAT YOU CAN'T SEE EVERY DAY.
THERE ARE TYPICALLY MORE ISSUES THAN YOU REALIZE.
I THINK I KNOW THE ANSWER TO THIS QUESTION, BUT DO ANY OF THESE DOLLARS HAVE JUST IMPROVEMENTS TO THE BUILDING.
JUST SOME UPGRADES TO THE BUILDING OR THEY JUST ARE DEALING WITH CURRENT REPAIRS?
>> THESE WOULD ESSENTIALLY BE NEEDS THAT ARE IDENTIFIED.
THIS IS MAJORITY UNDER THE HOOD.
PLUMBING, HVAC, ELECTRICAL, THERE ARE NO FIXTURES, CARPET, PAINT, WAY FINDING, NONE OF THESE ARE INCLUDED.
THERE MAY BE A SMALL PORTION OF WAY FINDING IN THE ADA UPGRADES, BUT OTHER THAN THAT, NO, MA'AM.
>> I THINK ONE OF THE QUESTIONS THAT REALLY HAS HIT ME IS THAT WOULD SELLING THE BUILDING FREE UP RESOURCES FOR HIGHER PRIORITY PROJECTS? I THINK THAT IS CIRCLED TO THAT QUESTION AND LOOKING TO SEE WHERE DO WE SPEND OUR RESOURCES OVER THE NEXT 10 YEARS? DO WE SPEND THEM ON THE MAINTENANCE PROJECTS HERE? THAT'S OUR DECISION OR DO WE HAVE HIGHER PRIORITIES, DIFFERENT PRIORITIES THAT WE WOULD RATHER TAKE THAT MONEY AND SPEND? THAT'S TO ME, AT LEAST PART OF THE EQUATION.
>> I BELIEVE AND I HOPE WHAT STAFF WILL PROVIDE COUNSEL WILL BE THE WHOLE RANGE OF CONSIDERATIONS.
DATA THAT YOU NEED TO MAKE THAT ASSESSMENT.
IT'S A TRUE FINANCIAL ASSESSMENT THAT'S TIED TO THIS ABOUT WHETHER OR NOT IT MAKES SENSE.
AT SOME POINT, AS I MENTIONED EARLIER, WE COULD MAKE AN UNDERTAKING AND SPEND HUNDREDS OF MILLIONS OF DOLLARS.
BUT YOU'D HAVE TO ASK YOURSELF THE QUESTION, AS YOU MENTIONED HERE, IS THAT MONEY WELL SPENT? IS THAT IN THE BEST INTEREST OF THE TAXPAYERS? WE'RE HOPING THAT THROUGH THIS PROCESS AS WE'RE GOING THROUGH IT, YOU'RE GOING TO ASK HIGH VALUE QUESTIONS.
WE'RE GOING TO BRING YOU HIGH VALUE DATA.
YOU GUYS ARE GOING TO BE ABLE TO WEIGH DECISIONS ABOUT WHAT WE NEED TO DO.
>> THEN JUMPING AHEAD, LOOKING AT OTHER BUILDINGS.
I WOULD HOPE WE WOULD LOOK AT PARKING.
I THINK PARKING IS VERY IMPORTANT.
I WOULD ASK US TO LOOK AT ACCESSIBILITY TO DART STATION.
SOME OF THE BUILDINGS YOU HAVE THERE HAVE GOOD ACCESSIBILITY.
[LAUGHTER] I LAUGH ABOUT THAT, BUT WE DO NEED AN OUTDOOR SPACE TO GATHER.
ONE THAT PEOPLE WANT TO GO TO THAT DON'T DIE.
I'M SORRY. WE'LL DESCRIBE THAT FOR YOU AT SOME POINT.
BUT WE GO TO OUR PLAZA TO CELEBRATE, WE GO TO OUR PLAZA TO PROTEST, OUTDOOR SPACES.
I THINK THAT SOMEHOW MIGHT NEED TO BE INCORPORATED IN WHEREVER WE'RE HEADED.
I THINK THAT'S AN ESSENTIAL PIECE.
THERE ARE A LAUNDRY LIST OF THINGS THAT NEED TO GO.
BUT THOSE ARE SOME OF THE THINGS THAT JUST HIT ME AS I WAS LOOKING AT THESE BUILDINGS.
>> THANK YOU, DEPUTY MAYOR PROTEN.
>> THANK YOU SO MUCH FOR THE PRESENTATION.
AS MUCH AS WE LOOK AT THIS, AND IT'S ABOUT A CITY ASSET.
THIS IS VERY SERIOUS WHEN YOU LOOK AT THESE NEEDS BECAUSE THE CITY OF DALLAS IS A LARGE EMPLOYER.
WE'VE GOT A LOT OF PEOPLE COMING IN AND OUT OF THIS BUILDING EVERY SINGLE DAY.
THIS IS THEIR JOB TO SERVE THE PUBLIC, NOT TO MENTION THE PUBLIC COMING IN AND OUT OF THIS BUILDING.
[00:25:01]
WHEN I LOOK AT A LIST THAT INCLUDES THINGS LIKE FIRE SUPPRESSION AND ADA COMPLIANCE, ALONG WITH HVAC ROOF REPLACEMENT.IF YOU SAW THESE IN YOUR HOME OR YOUR WORKPLACE ELSEWHERE, THESE WOULD BE OF TREMENDOUS CONCERNS.
BUT I THINK HAVING PEOPLE THAT WE ARE RESPONSIBLE FOR WORKING HERE.
THIS IS THE PLACE THAT WE EXPECT TO BE THEIR LAUNCH PAD FOR GREAT CUSTOMER SERVICE.
THAT ADDS AN ELEMENT THAT WE NEED TO CONSIDER.
BUT WE'RE LOOKING AT THESE NUMBERS AND THEY'RE REALLY BIG.
WHEN WE LOOK AT OUR OBLIGATIONS, THINGS LIKE THE FUNDING SOUNDNESS RESTORATION PLAN FOR THE PENSION THAT ESCALATES.
WE HAVE SOME YEARS WHERE WE'RE UP TO $500 MILLION IN OBLIGATION OR WHEN WE LOOK AT WHAT'S COMING OUT OF AUSTIN WITH THE POTENTIAL FOR CAPS ON WHAT OUR BUDGET CAN BE.
HOW COULD THIS BE PHASED? I WANT TO BE SURE THAT WE'RE LOOKING AT THIS.
THESE ARE BIG NUMBERS, BUT HOW CAN WE PHASE THESE? HAVE WE LOOKED AT WE WOULD HAVE TO DO THESE IN YEAR ONE.
THESE COULD BE DONE IN FIVE YEARS OR ARE YOU TELLING ME THAT THIS IS A BOTTOM LINE $152 MILLION TAB THAT IS FACING US IN 2026?
>> THAT'S AN EXCELLENT QUESTION.
I THINK WE'RE GOING TO NEED TO DO SOME ADDITIONAL DUE DILIGENCE WITH OUR CHIEF FINANCIAL OFFICER.
I KNOW THAT THEY'VE BEEN DOING A LOT OF WORK RECENTLY ABOUT LOOKING AT OUR FUTURE BOND CAPACITY AND WHAT THE CITY'S EXISTING DEBT IS.
A PROJECT LIKE THIS WOULD HAVE TO BE FOLDED IN.
MY GUESS WOULD BE OVER MULTIPLE YEARS.
THERE'S A LOT OF CONSIDERATIONS THERE THAT WE WOULD HAVE TO HAVE.
I'M NOT SURE IF OUR CFO IS READY TO SPEAK TO THAT TODAY.
BUT WE NEED TO SIT DOWN AND HELP WORK WITH THEM TO PENCIL IN WHAT THIS MIGHT LOOK LIKE IN SOME FUTURE BOND PROPOSITION.
>> THERE ARE TWO SIDES TO THAT.
ONE IS, WHAT CAN WE AFFORD AND WHEN, BUT THEN THE OTHER SIDE IS.
WHEN WE TALK ABOUT FIRE SUPPRESSION, THAT SOUNDS PRETTY IMMEDIATE AND ADA COMPLIANCE.
I HATE TO SEE US LAG ON THAT ANY FURTHER.
THERE ARE TWO SIDES TO THAT EQUATION, BUT THAT WOULD BE SOMETHING I'D BE INTERESTED IN KNOWING.
EVEN IF IT'S A RANGE, JUST TO GIVE AN IDEA OF YEAR ONE, YEAR TWO, THREE, FOUR, FIVE.
BUT LET'S LOOK AHEAD TO OPTION THREE AND UNDERSTANDING THAT YOU'VE OUTLINED SOME OPPORTUNITIES ON PAGE 27, SOME DIFFERENT BUILDINGS AROUND DOWNTOWN.
WHICH AGAIN, HAS ANOTHER SIDE TO THE EQUATION.
IT COULD ALLOW SOMEONE TO ACTIVATE THIS LOCATION WHILE WE ALSO INVEST IN DOWNTOWN AND REVITALIZE ANOTHER PART OF OUR CITY THAT MAY NEED IT.
BUT AS WE LOOK AT CITY HALL, NOT EVERYTHING THAT'S HERE TODAY NEEDS TO BE HERE.
IN FACT, PROBABLY NOT A GREAT IDEA TO HAVE 911 HERE AND 311 HERE, AND ITS HERE IN A BUILDING THAT COULD BE A TARGET, QUITE FRANKLY.
HOW COULD THAT HELP MAKE US AGILE IF WE CHOSE TO MOVE?
>> I LIKE TO LOOK AT CHAIR WEST WHEN I GO HERE BECAUSE HE'S BEAT ME OVER THE HEAD ABOUT SPACE PLANNING FOR THE LAST 18 MONTHS.
BUT THAT'S A STRATEGIC PART OF DECISION MAKING THAT STAFF IS GOING TO HAVE TO DO ABOUT IF WE KEEP CITY HALL, WHO STAYS, AND IF WE DECIDE TO MOVE SOMEWHERE ELSE, WHAT'S THE BEST ALLOCATION OF STAFF IN AN EFFORT TO PRODUCE A PROFESSIONAL ENVIRONMENT? HAVE A CUSTOMER SERVICE FRONT DOOR FOR A TRADITIONAL CITY HALL THAT PEOPLE ARE ACCUSTOMED TO DOING BUSINESS? THOSE ARE THINGS THAT WE STILL NEED TO WORK THROUGH.
BUT WE HEAR YOU LOUD AND CLEAR.
WE'LL GET SUBJECT MATTER EXPERTS TO HELP US WITH THAT, TO DO THOSE ANALYSIS.
WE'RE STILL A LITTLE STUCK IN THAT SPOT RELATIVE TO SPACE PLANNING.
BUT WE'RE WORKING VERY FEVERISHLY ON THAT, WORKING WITH THE DIRECTORS.
THOSE STAFF THAT ARE IN THE BUILDING, DOING ASSESSMENTS ABOUT WHAT MAKES SENSE TO BE AWARE SO THAT WE CAN PROVIDE THE HIGHEST LEVEL OF SERVICES POSSIBLE REGARDLESS OF HOW STAFF IS SPLIT UP.
INCLUDE ITEMS LIKE YOU MENTIONED ABOUT SECURITY, SENSITIVE AREAS LIKE 911, 311? WE TALK ABOUT THAT ALMOST EVERY DAY IN AN EFFORT TO BE ABLE TO FACILITATE THOSE PEOPLE EVEN BEING IN THIS BUILDING.
THERE'S A GREAT CONCERN, AND I HATE TO BRING THIS UP.
BUT I THINK IT KEEPS JOHN UP AT NIGHT JUST A LITTLE BIT, TRYING TO MAKE SURE THAT 911 STAYS OPERATING AND RUNNING.
>> WELL, YOU'RE NOT ALONE. I KNOW THIS IS PROBABLY TOUGH TO PUT A TIME FRAME ON.
BUT IF WE WERE TO EXIT TO A NEW LOCATION, DO YOU HAVE ANY SENSE OF WHAT THE TIME FRAME WOULD BE TO DO THAT?
>> I THINK IT WOULD DEPEND ON WHERE WE WERE GOING AND WHO WAS GOING WHERE.
IF IT WAS LOCK STOCK AND BARREL, ONE MOVE OF EVERYONE, THAT'S A DIFFERENT TIMELINE.
THEN WE TAKE THIS FIRST PHASE OF THESE PEOPLE AREN'T GOING TO BE IN A CO-LOCATED SPACE ANYMORE AND MOVE THEM.
I THINK AT MINIMUM, YOU WOULD LOOK AT A YEAR OR MORE CERTAINLY.
>> THEN LAST QUESTION ON PAGE 22 OR SOMEWHERE IN HERE YOU REFERENCED 500/500 FACILITIES AND THE NEED FOR THE ASSESSMENT. BUT ARE WE USING?
[00:30:02]
I KNOW THERE ARE FIRMS OUT THERE THAT TAKE OLD STRUCTURAL REPORTS AND JUST OTHER PHOTOS THAT WE'VE HAD OVER TIME AND LET AI DO SOME WORK TO GUIDE US ON WHAT MIGHT NEED TO BE A PRIORITY.IS THAT PART OF OUR PROCUREMENT TO FIND A FIRM THAT CAN DO OR HAS THAT CAPABILITY?
>> WE HAVEN'T COMPLETED THE FORMAL PROCUREMENT YET.
WE JUST RECEIVED THE FUNDS FOR IT IN THIS CURRENT FISCAL YEAR, OCTOBER 1.
BUT THAT'S ABSOLUTELY SOMETHING THAT WE CAN INCLUDE IN THE SPECIFICATIONS TO SEE WHAT OFFERINGS THEY HAVE AVAILABLE IN THE WAY OF AI OR PAST REPORTS.
THEN WHAT THAT DOES TO THE COST OF THE ACTUAL OVERALL SERVICE?
I THINK THE WAY I'M JUST ASSESSING THIS, AND YOU LET ME KNOW IF I'M OFF, WE HAVE REALLY THE COST OF DEFERRED MAINTENANCE. WHAT IS THAT? THE COST OF A NEW BUILDING PLUS THE INVESTMENTS, AND THEN THE RETURN ON THE SURROUNDING AREA, AS MY COLLEAGUE JUST MENTIONED, BOTH THIS AREA, IF WE WERE TO VACATE, AND THEN THE AREA, THE OTHER AREA, IF WE WERE TO MOVE INTO IT, WHAT WOULD BE THE RETURN ON THOSE INVESTMENTS? SO, ON ONE HAND, I GET, THIS BUILDING NEEDS A LOT OF WORK AND A LOT OF ATTENTION, AND IT'S A LOT OF OPPORTUNITIES THAT WE'VE HAD AS A BODY IN 2024, 2017 BOND PROGRAM TO REALLY MAKE SOME OF THOSE INVESTMENTS TO KEEP YOU CAUGHT UP TO SPEED, FOR WHATEVER REASON, AGAIN, THE COMMUNITY, THERE JUST WASN'T A TASTE FOR THAT.
UNDERSTAND THAT. NOW WE'RE AT A DECISION POINT IN TERMS OF, WHAT DO WE DO WITH THIS SPACE? WE LISTED THOSE OPTIONS.
THOSE AREN'T ARE WE LIMITED TO JUST THOSE OPTIONS, OR HAS THERE BEEN ANY REAL TO THIS POINT, ANY REAL OUTSIDE OF ASSESSING THE COST OF DEFERRED MAINTENANCE? HAS THERE BEEN ANY REAL WORK DONE AROUND WHAT OTHER OPTIONS COULD BE AND SPECIFIC COST OR SPECIFIC COST ESTIMATES SO THAT WE COULD HAVE AT LEAST A DECISION POINT IN TERMS OF WHAT WE THINK IT MIGHT COST TO TRANSITION TO ANOTHER LOCATION?
>> COUNCILMAN GRACE, I'M GLAD YOU BROUGHT THAT UP.
DURING OUR SPACE PLANNING EFFORTS IN DEALING WITH EXPERTS, PEOPLE WHO REALLY KNOW AND UNDERSTAND DOWNTOWN, PEOPLE WHO TRANSACT AND DO BUSINESS WITH CITY HALL.
THEY OFTEN BRING UP IDEAS, AND WE EXCHANGE INFORMATION AND IDEAS WITH THEM.
WE HAVEN'T FLESHED OUT WHAT IT WOULD LOOK LIKE.
WE WERE HOPING TO GET FEEDBACK, FROM THE COMMITTEE TODAY TO GIVE US SOME IDEA OF WHETHER OR NOT WE REALLY NEED TO LEAN IN THIS DIRECTION.
IF SO, WE'LL TAKE THAT EXPERT HELP OF PEOPLE WHO KNOW AND UNDERSTAND LEASING AND GETTING SPACE PLANNING EFFORTS DONE IN DOWNTOWN, WE'LL LEAN ON THEM AND BRING THAT DATA BACK TO THIS COMMITTEE FOR REVIEW AND ASSESSMENT.
>> THANK YOU. WELL, I THINK IN ORDER TO OBVIOUSLY, WE WOULD NEED TO PUT IT IN THIS BUILDING IS A TREMENDOUS AMOUNT FROM THERE.
I WOULD JUST BE CURIOUS TO MOVE FORWARD AS A BODY.
I'D BE CURIOUS TO START EXPLORING WHAT SOME OF THOSE OPTIONS WOULD BE.
AND THEN I GUESS ANOTHER QUESTION IS, IS IT JUST AS WE GO THROUGH THIS EXERCISE, ARE WE JUST LOOKING AT THIS FACILITY, OR ARE WE EXPLORING OTHER OPPORTUNITIES TO PERHAPS CONSOLIDATE OTHER OFFICES AS WELL?
>> COUNCILMAN GRACE, I THINK THE ANSWER IS YES AND YES.
I THINK WHEN WE UNDERTAKE SUCH A MASSIVE POTENTIAL MOVE LIKE THAT, WE HAVE TO DO THAT.
WE HAVE TO RUN THE NUMBERS FROM ONE END TO THE OTHER AND CONSOLIDATING, DIFFERENT OFFICE SPACE AND MAKING SURE THAT WE HAVE PEOPLE COLOCATED THAT WHERE THEY MAKE THE MOST SENSE.
THERE'S DIFFERENT VARIETIES OF REAL ESTATE ASSETS THAT ARE AVAILABLE, DEPENDING ON A STRUCTURED NEED LIKE WE HAVE IN ITS.
VERSUS MAYBE MORE OF AN OFFICE NEED FOR MAYBE EVEN THE COUNCIL OFFICES FOR THAT MATTER OR EVEN DEVELOPING A COUNCIL CHAMBER IF WE WERE TO MOVE SOMEWHERE ELSE.
AND WE'RE GOING TO NEED HELP TO BE ABLE TO MAKE THOSE DECISIONS AND FIND THAT SPACE.
>> EXCELLENT. THANK YOU, MR. CHAIR.
>> WE'LL GO TO MAYOR PROTEIN NEXT. THANK YOU, CHAIR.
>> THANK YOU FOR THE PRESENTATION.
SOMEONE WHO LIVES IN A CONSERVATION DISTRICT AND REPRESENTS MULTIPLE HISTORIC DISTRICTS.
WE WANT TO MAKE SURE THAT WE'RE DOING EVERYTHING WE CAN TO PRESERVE.
DALLAS IS A RELATIVELY YOUNG CITY.
THE SAME TIME, THOUGH, I KNOW THAT KEEPING THESE STRUCTURES AT A HOME IN MY CASE GETS VERY EXPENSIVE.
CONSTANT MAINTENANCE ALMOST EVERY YEAR.
WITH THAT, I WANT TO TALK A LITTLE BIT ABOUT FIRST STARTING OFF WITH THE ASSESSMENT.
CAN YOU REMIND ME WHO DID THE EVALUATION FOR CITY HALL? THE MOST RECENT ONE?
>> THERE HAS NOT BEEN A RECENT ASSESSMENT OF CITY HALL? IT WAS INCLUDED IN THE 2017 CITYWIDE, WHICH ONLY ASSESSED 220 OF OUR 500 BUILDINGS AND THAT WAS COMPLETED BY AEC.
[00:35:05]
>> SO AS WE TALK ABOUT COUNSEL NOT PREVIOUSLY SUPPORTING A BOND PROPOSITION FOR CITY HALL? THAT'S MY HESITATION, AND THAT'S MY CONCERN IS THAT WE TRULY DON'T HAVE A TRUE ANALYSIS, OF WHAT IT'S GOING TO COST TO MAKE ALL THE NECESSARY REPAIRS.
WITH THAT BEING SAID, ABOUT THE ROUGHLY $350 MILLION CHARGE, IS THAT PHASED IN OR IS THAT ALL AT ONCE? I WOULD WANT TO REALLY CONSIDER DOING EVERYTHING AT ONCE OR AT LEAST IN TWO PHASES? WE KNOW THAT IT'S MORE ECONOMICAL TO DO MULTIPLE PROJECTS AT ONCE RATHER THAN DOING PROJECTS THROUGH EVERY OTHER YEAR.
THEN WHAT DOES THAT DO TO STAFF? DOES THAT MEAN THAT WE HAVE TO COMPLETELY REMOVE FLOORS AT A TIME, AND THAT'S GOING TO CAUSE HAVOC WITH STAFF GOING IN AND OUT OF THE BUILDING, WHEN IS IT READY? DO WE HAVE ANY IDEA HOW PHASING WOULD POTENTIALLY WORK?
>> I THINK THIS GOES BACK TO DEPUTY MAYOR PRO TEM WILLIS'S QUESTION ABOUT HOW COULD IT BE PHASED IN.
THE CHART ON SLIDE SEVEN IS ESSENTIALLY EVERYTHING THAT WE KNOW AT THIS POINT FOR A TOTAL COST.
THERE HAVE BEEN NO PHASING OR STAGING IS NOT INCLUDED IN THAT, NOR IS THE COST OF IF WE HAD TO TEMPORARILY RELOCATE STAFF WHILE REPAIRS WERE GOING ON? THESE FIGURES DO NOT REFLECT THAT.
>> THANK YOU. WE TALKED A LOT ABOUT THAT.
THESE, THE NEEDS THAT WE'VE ADDRESSED ARE EITHER BASIC LIFE SAVING NEEDS OR JUST THINGS THAT WE HAVE TO GET DONE.
I'M GLAD WE TALKED ABOUT SPACE PLANNING AND THE MODERNIZATION OF A NEW BUILDING.
I DON'T THINK THESE DOLLARS TAKE INTO ACCOUNT THOSE EFFORTS TO MAKE THIS BUILDING MORE USER FRIENDLY AND MORE FRIENDLY TO OUR RESIDENTS, IS THAT ACCURATE?
>> CORRECT. AGAIN, IT'S MORE UNDER THE HOOD, AND THE PREVIOUS STUDIES MAY HAVE INCLUDED A BRAIN HEALTHY ENVIRONMENT COMPONENT, BUT THESE DO NOT.
>> WITH THAT BEING SAID, I DON'T THINK WE SHOULD EVEN BE LOOKING AT OPTION ONE.
I THINK THAT WE KNOW WHERE THAT'S GOING TO HEAD AND IT'S JUST GOING TO BE DRAGGED OUT AND IT'S GOING TO COST MORE DOLLARS AT THE END OF THE DAY.
AND SO THAT'S WHERE I'M AT RIGHT NOW IS JUST REALLY REMOVING OPTION ONE FROM THE TABLE.
THEN MAYBE ON A ROUND TWO, I'LL GO A LITTLE BIT DEEPER ON WHICH OF THE REMAINING OPTIONS I AM LEANING TOWARDS. THANK YOU, CHAIR.
>> THANK YOU. I'M GOING TO TURN OVER TO COUNCIL MEMBER RESENDEZ.
>> THANK YOU, MR. CHAIR, AND THANK YOU ALL FOR THE PRESENTATION.
I'M CURIOUS TO KNOW HOW THE ESTIMATES ON PAGE 7 WERE DEVELOPED.
>> YES, SIR. THESE ARE PLANNING LEVEL ESTIMATES.
THEY ARE INTENDED TO REFLECT THE POTENTIAL RANGE OF NEED, NOT NECESSARILY FINANCIAL COST FOR CONSTRUCTION OR ENGINEERING.
>> WOULD THE FACILITY CONDITION ASSESSMENT PROVIDE THAT DEEPER?
>> PARTICULARLY, YES, THE FACILITY CONDITION ASSESSMENT WOULD PROVIDE US WITH A SHARPER ESTIMATE FOR THAT, BUT IT WOULDN'T NECESSARILY CHANGE OR MAKE THE CHALLENGE ANY SMALLER.
EVERY YEAR THAT DEFERRED MAINTENANCE CONTINUES, THE RISK AND COSTS ALSO INCREASE COMMENSURATELY.
>> DO WE KNOW WHAT THE ESTIMATED VALUE OF THIS PROPERTY IS, LAND AND BUILDING?
>> WE MAY HAVE SOMEONE FROM ECONOMIC DEVELOPMENT OR SOMEONE THAT COULD SHARE THAT, BUT I DON'T KNOW THAT WE WOULD WANT TO SAY THAT OUT LOUD.
>> THAT'S FINE. THAT'S NOT A PROBLEM.
I MEAN, TO ME, I THINK IT'S PRETTY STRAIGHTFORWARD.
IT'S NOT EVEN A HARD DECISION IN TERMS OF WHAT OPTION TO EXPLORE.
TO ME, I THINK OPTION THREE MAKES THE MOST SENSE.
WE NEED TO BE EXPLORING WHAT THE ALTERNATIVES ARE.
I THINK THAT WOULD BE WHAT'S IN THE BEST INTEREST OF THE CITY AND THE TAXPAYERS.
BUT, I'M STILL OPEN TO HEARING THE DISCUSSION AND SEEING WHAT OTHER PERSPECTIVES ARE PROVIDED. THANK YOU.
>> THANK YOU. COUNCIL MEMBER, I'M GOING TO TURN OVER TO CHAIRMAN JOHNSON.
ON THE SAME LINES, COUNCILMAN HIM THAT WAS JUST SPEAKING ON PAGE 7.
I'M LOOKING AT THE NUMBERS, AND I DIDN'T HEAR THE ANSWER TO THAT, SO I'M GOING TO ASK THAT QUESTION AGAIN.
THE NUMBERS THAT WE'RE SEEING HERE WERE THE RANGE, MINIMUM AND RANGE, HIGH FOR H BACK ROOF, ET CETERA, ET CETERA.
WHERE DID WE GET THE MATRIX? WHAT MATRIX DID WE USE TO GET THESE NUMBERS HERE?
>> THE CURRENT ESTIMATES WERE DEVELOPED USING THE AVAILABLE INFORMATION THAT WE HAVE, APPLYING ESCALATION FACTORS USING OTHER COMPARABLE CONSTRUCTION COSTS, BUT WE HAVE NEVER BEEN FUNDED TO COMPLETE A NUMBER OF THESE PROFESSIONAL STUDIES.
WE ARE DOING OUR BEST WITH STAFF KNOWLEDGE, SPEAKING TO SUBJECT MATTER EXPERTS, AND THEN USING ANYTHING THAT WE HAVE THAT'S DATED AND ADJUSTING IT FOR INFLATION TO BRING IT FORWARD.
>> UNDERSTAND. WHEN I'M LOOKING AT THE DEFERRED MAINTENANCE, AND I'M LOOKING AT THE PRESENTATION.
[00:40:03]
I JUST CAME FROM INSTITUTION WHERE I SERVED AS A SCHOOL BOARD TRUSTEE, AND I'M LOOKING AT THESE PICTURES THAT LOOK DEPLOABLE, AND IT REMINDS ME OF ONE OF THE SCHOOLS THAT WAS IN MY DISTRICT, SOUTH OAKLIFF HIGH SCHOOL, HOW KIDS HAD TO WALK OUT AND PROTEST BECAUSE THE BUILDING WAS DEPLOORABLE.WHEN I'M LOOKING AT THIS, IT LOOKED LIKE THIS BUILDING MAY BE BEYOND LIFE EXPECTANCY.
IS THAT A FAIR STATEMENT TO SAY THAT IT'S POSSIBLY BEYOND LIFE EXPECTANCY?
>> I THINK IN ITS CURRENT CONDITION AND ITS LACK OF INVESTMENT COULD LEAD YOU TO THAT, YES.
>> WHEN WE'RE LOOKING AT THE FINANCIAL STATEMENTS THAT'S ON PAGE 73 RANGE TO 24 MILLION HVAC HIGH LEVEL, 40 PLUS 40 MILLION PLUS, ROOF REPLACEMENT, 4 MILLION PLUS, WATER INFILTRATION, 100 MILLION PLUS, WHEN WE'RE LOOKING AT IT ALL THE WAY DOWN TO THE ESTIMATE TOTALS OF 345 MILLION, THAT'S JUST POTENTIALLY REPAIR.
THAT'S NOT ANYTHING AS JUST WHAT IT WOULD DO, JUST TO CONTINUE TO PUT WHAT I WOULD CALL A LIPSTICK ON THE P.
>> THE MINIMUM RANGE WOULD BE MORE OF AN ISOLATED REPAIR OR A COMPONENT LEVEL REPAIR.
WHAT YOU SEE IN THE HIGH RANGE WOULD BE A FULL SYSTEM REPLACEMENT.
INSTEAD OF HAVING TO GO IN AND CHANGE A COMPRESSOR, WE MUST COMPLETELY CHANGE OUT ALL OF THE HVAC EQUIPMENT, THE AIR HANDLER CHILLER, EVERYTHING.
>> AT THIS POINT, AT THIS MOMENT, WE DO NOT HAVE THE TOTAL NUMBER OF WHAT IT WOULD COST TO DO ANYTHING ELSE OUTSIDE OF THIS, WHAT A NEW BUILDER WOULD COST, WHAT A TOTAL RE RENOVATION WOULD COST, WE DON'T HAVE THOSE NUMBERS, NUMBERS AT ALL.
>> THANK YOU. WE'LL GO TO OUR NON COMMITTEE MEMBERS.
I'LL DO CHAIRMAN RIDLEY AND THEN BLACKMAN, AND THEN BASL DO.
>> THANK YOU, MR. CHAIR. THANK YOU FOR THE PRESENTATION.
AT THE RISK OF RETURNING TO A PAGE THAT HAS ALREADY BEEN THE SUBJECT OF QUESTIONS, I MUST GO BACK TO THE TABLE ON PAGE 7.
NOW, THIS FIGURE, THESE TWO RANGES THAT WERE PROVIDED, WERE NOT PREPARED BY ANY PROFESSIONAL ESTIMATORS, WERE THEY?
>> WELL, THE ONES WITHOUT THE ASTRICT ARE EITHER BASED ON A QUOTE OR THROUGH A PROFESSOR.
>> I'M SORRY, THE ONES WITH THE ASCERS ARE WHAT? THE ONES WITH THE ASTRICT DO NOT, NO, SIR.
>> THIS IS NOT BASED UPON ANY DEFINED SCOPE OF WORK THAT YOU WOULD NEED TO GET A REALISTIC COST ESTIMATE, IS IT?
>> I WOULD SLIGHTLY DISAGREE IN SOME OF THESE CASES.
SO, FOR INSTANCE, THE WATER INFILTRATION WAS BASED ON A 2000 ASSESSMENT THAT WAS COMPLETED, AND AT THE TIME, IT DETAILED $40 MILLION WORTH OF NEEDS TO ADDRESS THE WATER INFILTRATION IN THE GARAGE AT THAT TIME.
>> WHERE DID THAT COME FROM? A CONTRACTOR?
>> THAT WAS FROM A PROFESSIONAL ASSESSMENT THAT WAS COMPLETED.
>> I DON'T KNOW WHO THAT WAS, BUT I HAVE TO SEE.
>> WELL, FINE. I THINK WE CAN DISCOUNT IT IF WE CAN'T EVEN TELL WHAT THAT PROFESSIONAL WAS AND WHAT THEY WERE EXPERT IN.
ALL OF THESE NUMBERS ARE PURELY SPECULATIVE, AREN'T THEY? YOU DON'T HAVE ANY COST ESTIMATES THAT RELIES UPON.
>> COUNCILMAN, RALLY, THANK YOU FOR THE QUESTIONS.
IF YOU'RE ASKING IF STAFF WENT OUT AND HAD SOMEONE COME IN AND DO 18 MONTHS WORTH OF WORK TO DETERMINE, WHAT THE EXACT COST WOULD BE THE ANSWER TO THAT QUESTION IS NO.
BUT BASED ON OUR EXPERIENCE AND SOME OF THE NUMBERS THAT JOHN RAN, BECAUSE WE DISCUSSED THESE NUMBERS, WE KNEW THAT WOULD BE A LOT OF CONVERSATION TODAY AND WE WANTED TO MAKE SURE, THAT WE PROVIDED THE BEST DATA POSSIBLE.
IN SOME INSTANCES, WE HAD INFORMATION, AND FORGIVE US FOR NOT HAVING THE EXACT COMPANY NAME, BUT 20 YEARS LATER, IT MAY NOT NECESSARILY BE AS RELEVANT EVEN THE NAME OF THE COMPANY.
THAT BEING SAID, WE DID FORECAST BASED ON WHAT WE KNOW TODAY'S CONSTRUCTION COST WOULD BE. WE DO THAT OFTEN.
SOMETIMES IT'S 20 YEARS, SOMETIMES IT'S TEN YEARS, SOMETIMES IT'S FIVE YEARS, AS IT RELATES TO HOW WE THEN PROJECT FORWARD, BUT THAT'S EXACTLY WHAT WE WERE ABLE TO DO HERE.
IN AN EFFORT AT WORST TO GET YOU A MINIMUM RANGE.
ON A LARGE END, THE MAXIMUM MEAN, AS JOHN MENTIONED, A TOTAL SYSTEM CHANGE OUT.
>> WELL, THE PROBLEM WITH PROJECTIONS FROM DATA OF 20 YEARS AGO ARE THAT THEY DON'T TAKE INTO ACCOUNT CURRENT MARKET CONDITIONS FOR THAT PARTICULAR TRADE OR EXPERTISE.
I SUBMIT THAT THESE ARE NOT THE FIGURES THAT WE CAN BASE OUR DECISIONS ON.
WE NEED TO WAIT UNTIL THERE IS A COMPREHENSIVE SURVEY OF THE BUILDING TO DETERMINE EXACTLY WHAT WORK NEEDS TO BE DONE, WHAT THE PRIORITY FOR THAT WORK IS, AND AN EDUCATED IDEA OF WHAT THE COST IS GOING TO BE.
I SUBMIT THAT IT'S PREMATURE TO MAKE ANY DECISIONS BASED UPON THIS ONE TABLE THAT'S LARGELY CONJECTURAL.
>> COUNCILMAN I HEAR YOU 100%.
[00:45:01]
THAT IS A VERY GOOD VALUE STATEMENT.I THINK TO THE WORK THAT JOHN AND I DID ON THIS BRIEFING IS THAT CONSTRUCTION COST OVER THE LAST TEN YEARS, FIVE YEARS, IT'S GONE UP, AND WE EXPECTED IN THE FUTURE TO GO UP.
AS OFTEN AS WE'VE DEFERRED THE MAINTENANCE, AND EVERY YEAR WHEN JOHN OR ANYBODY ELSE, ONE OF HIS PREDECESSORS HAS COME AND SAID, THIS IS HOW MUCH WE NEED.
EVERY FOUR TO FIVE YEARS IT'S NOT BAKED INTO THE BOND PROGRAM, THEN THE NEXT TIME SOMEONE SHOWS UP AND ASKED FOR IT AT A COMMUNITY MEETING, IT'S A LARGER NUMBER.
>> WELL, I UNDERSTAND INFLATION. SIR.
>> BUT TO CALCULATE THAT NUMBER, YOU HAVE TO HAVE A RELIABLE BASE AT SOME POINT OF TIME IN ORDER TO ADJUST FOR INFLATION.
AND I SUBMIT I DON'T THINK WE HAVE THAT RELIABLE BASE.
WE DON'T HAVE ANY BIDS FROM CONTRACTORS FOR ANY OF THIS WORK.
WE DON'T HAVE AN ENGINEER'S ESTIMATE OF COST OR EVEN SCOPE OF WORK.
I'M JUST STATING THAT I THINK IT'S PREMATURE TO BASE ANY POLICY DECISIONS ABOUT THE FUTURE OF CITY HALL ON THIS TABLE.
TO LET ME GO ON. WHY DO YOU BELIEVE IT'S GOING TO TAKE 18 MONTHS TO TWO YEARS, TO DO AN ANALYSIS OF THE DEFICIENCIES IN CITY HALL?
>> THE 18-24 MONTHS RANGE WAS FOR THE CITY WIDE ASSESSMENT THAT'S PLANNED TO BE DONE IN THIS FISCAL YEAR.
>> THAT'S FOR ALL THE CITY BUILDINGS?
>> WELL, YOU'VE LEFT A DISTINCT IMPRESSION THAT IT'S GOING TO TAKE THAT LONG JUST TO ASSESS CITY HALL.
>> DO YOU HAVE A SPECIFIC ASSESSMENT FOR CITY HALL?
>> THAT'S ANOTHER REASON NOT TO JUMP TO CONCLUSIONS BASED UPON THE FACT OF THESE NUMBERS OR ON THE ESTIMATE OF 18 MONTHS TO TWO YEARS.
IT SHOULDN'T TAKE THAT LONG FOR A QUALIFIED ENGINEERING FIRM TO DO SUCH AN ASSESSMENT OF THE BUILDING.
NOW, WITH REGARD TO PAGE 13, YOU TALK ABOUT THE SPOILED CONCRETE IN THE COLUMNS IN THE GARAGE.
WHAT DID THAT CAUSE TO REPAIR?
>> ALL OF THE SPALLING WAS REPAIRED AT THAT TIME?
>> AT THAT TIME, I BELIEVE IT WAS ONLY JUST A COUPLE COLUMNS, YES, SIR.
>> WELL, ARE THERE ADDITIONAL STRUCTURAL REPAIRS THAT NEED TO BE DONE TO THE COLUMNS IN THE GARAGE?
>> WE WOULD NOT NOTICE UNTIL WE HAD AN ENGINEERING ASSESSMENT COMPLETED.
BUT AS YOU CAN SEE FROM THE PHOTOGRAPHS THAT WERE PROVIDED, I BELIEVE ON SLIDE EIGHT, YOU CAN SEE WHERE THERE IS ALREADY SEPARATION AND ADDITIONAL WATER INFILTRATION.
>> WELL, I'M JUST TALKING ABOUT THE SPALLING NOW BECAUSE THIS IS UNDER THE EXAMPLE OF GARAGE STRUCTURAL FAILURES AND THAT IS AN IMPORTANT ISSUE AS TO WHETHER THIS BUILDING IS SOMETHING THAT CAN BE SALVAGED OR NOT.
I WANT TO KNOW IF THERE ARE ANY OTHER EXAMPLES OF SPALLING CONCRETE ANYWHERE IN CITY HALL THAT HAVE BEEN OBSERVED.
>> I WILL NEED TO CHECK WITH OUR ENGINEERING STAFF AND GET YOU AN ANSWER FOR THAT.
>> YOU USE SPALLING CONCRETE AS AN EXAMPLE OF A STRUCTURAL FAILURE, BUT YOU CAN'T TELL US THE EXTENT OF THAT?
>> I CAN TELL YOU THE EXTENT OF IT WAS LIMITED TO, I BELIEVE, TWO COLUMNS, WHICH WAS REPAIRED THAT INCLUDED THE ENGINEERING THE CONSTRUCTION AND THEN THE MISCELLANEOUS EXPENSES, BUT IT NECESSARILY DID NOT ENCOMPASS THE ENTIRE GARAGE AS WELL JUST LIMITED TO THE [OVERLAPPING].
>> DID THOSE REPAIRS CREATE A SOUND STRUCTURAL CONDITION AFTER THEY WERE PERFORMED? FOR THOSE COLUMNS.
>> FOR THE LIMITED COLUMNS, YES, SIR.
>> ALL RIGHT. COUNCIL RILEY, JUST TO YOUR POINT, AS IT RELATES TO ANY OF THESE PHOTOS, WITHOUT FUNDING, WITHOUT PROPERLY ADDRESSING DEFERRED MAINTENANCE IN THIS BUILDING, WHAT'S ON SLIDE 13? THAT IS THE FUTURE OF THE GARAGE?
>> WELL, ARE YOU A LICENSED ENGINEER?
>> NO, SIR. BUT I'VE BEEN IN THIS BUILDING FOR 28 YEARS, AND I'VE WATCHED IT DETERIORATE OVER THAT TIME.
>> WELL, THAT'S NOT THE POINT.
THE POINT IS WHETHER YOU ARE QUALIFIED, SIR, TO SPECULATE THAT THESE COLUMNS ARE ALL GOING TO SPALL IF WE DON'T DO SOME PREVENTIVE MAINTENANCE.
I SUBMIT THAT'S A TASK FOR THE PROFESSIONAL ENGINEERING FIRM THAT DOES THE CONDITION SURVEY, AGREE AND NOT YOUR ROLE AS AN ASSISTANT CITY MANAGER.
>> NOW, A COUPLE OF YEARS AGO, WE DID MILLIONS OF DOLLARS OF REPAIRS TO OUR HVAC SYSTEM IN THE BUILDING AND I'M CURIOUS, ONE, HOW MUCH WAS SPENT AND WHAT WORK WAS DONE BECAUSE WE WERE INFORMED AT THE TIME THAT THAT TOOK CARE OF THE DEFICIENCIES IN THE HVAC SYSTEM.
>> I BELIEVE WHAT YOU'RE REFERENCING IS
[00:50:01]
THE BOILER PROJECT THAT WAS RELATED TO THE HEAT BECAUSE WE WERE GOING THROUGH A WINTER WITHOUT THE ABILITY TO GENERATE HEAT TO HEAT THE BUILDING.SO WE TOOK THE OLD STEAM BOILERS AND REPLACED THEM WITH NEW ENERGY EFFICIENT HOT WATER, AND THAT WAS $3.25 MILLION THAT WAS COMPLETED.
IT DID NOT TOUCH ANY OF THE CHILLED WATER LOOPS, THE CHILLER, THE AIR HANDLER, ANY OF THAT EQUIPMENT.
IT WAS STRICTLY LIMITED TO THE BOILERS AND THEN THE PRIMARY HOT WATER LOOP.
>> THE HEATING SYSTEM IN CITY HALL IS UP TO CODE AND ADEQUATE FOR THE USE REQUIRED.
WE CANNOT EFFICIENTLY PUSH IT OUT AND EVENLY THROUGHOUT THE BUILDING BECAUSE THE CONTROLS PORTION WAS NOT FUNDED.
INCLUDED IN THAT NUMBER IS A NUMBER OF COMPONENTS OF WHICH WOULD BE TO REPLACE THE OLD PNEUMATIC SYSTEM OF THE CONTROLS SO THAT WE CAN OPEN AND CLOSE DAMPERS AND MOVE HEATED AND COOLED AIR THROUGHOUT THE BUILDING.
>> IN TERMS OF OPTION THREE, MOVING TO NEW BUILDINGS, YOU HAVE NO ESTIMATE AS TO WHAT THE BUILD OUT COST OR TIME FOR THAT SPACE WOULD BE.
IN OTHER WORDS, WE CAN'T JUST MOVE EVERYBODY FROM CITY HALL TO A PRIVATE OFFICE BUILDING IN ONE DAY.
THAT SPACE WOULD NEED TO BE BUILD OUT AT SOME EXPENSE, WOULDN'T IT?
>> THANK YOU. WE'LL GO TO COUNCIL WITMAN.
>> THANK YOU, AND THANK YOU FOR BEING HERE.
OKAY, SO JUST FOR CLARIFICATION, THE BUILDING'S NOT GOING TO FALL DOWN, RIGHT? WE'RE OKAY.
>> WE HAVE A RESPONSIBILITY TO OUR STAFF AND OUR RESIDENTS.
WE WOULD NOT PUT ANYONE IN AN UNSAFE CONDITION.
>> BECAUSE YOU'VE SHOWED US SOME PRETTY ALARMING THINGS.
>> THOSE WERE PREVIOUSLY REPAIRED, I JUST WANTED TO.
>> WE'VE SEEN THOSE. I MEAN, WE'VE EXPERIENCED I MEAN, IT'S FREEZING COLD ON WEDNESDAY.
WE ALL HAVE HEATERS DOWN HERE.
NOW YOU'VE EXPLAINED WHY AND THANK YOU FOR THAT.
BUT ARE YOU SAYING, HAVE WE DONE ANY MAJOR MAINTENANCE TO THIS BUILDING IN THE 47 YEARS? I KNOW WE'VE HARDENED IT FOR SAFETY REASONS.
BUT HAVE WE DONE ANY MAJOR MAINTENANCE TO THIS BUILDING IN THE 47 YEARS THAT WE'VE OCCUPIED IT.
YES, SELECT INVESTMENTS THAT I THINK EITHER FAILED AND REQUIRED THAT WE DID THAT.
WE'VE DONE THE INTERIOR GUTTER SYSTEM THAT I MENTIONED AS A VALUE ENGINEERED COMPONENT BECAUSE WE COULDN'T AFFORD THE $40 MILLION ESTIMATE.
BUT THE GENERATORS, THEY'RE ORIGINAL TO THIS BUILDING.
THE BOILERS THAT WE JUST REPLACED, ORIGINAL TO THIS BUILDING, MOST OF THE HVAC EQUIPMENT THAT'S INCLUDED IN THE ESTIMATE ORIGINAL TO THIS BUILDING?
>> AS YOU KNOW WE'RE AT THAT SYSTEMS EXPIRATION, I MEAN 47 YEARS, AND I LOVE THIS BUILDING.
I MEAN, IT'S A GREAT ARCHITECTURE.
I'M MARRIED TO AN ARCHITECT. WE TALK ABOUT THIS.
IT'S A GREAT BUILDING, BUT WE'VE REALLY NOT TAKEN CARE OF IT.
IF YOU'VE JUST EXPLAINED THAT, WE'VE NOT TAKEN CARE OF IT.
AS A MATTER OF FACT, I THINK WE'VE HARMED IT IN A LOT OF WAYS BY CLOSING OFF SPACES THAT SHOULD HAVE BEEN OPENED BECAUSE IT WAS TRANSPARENT GOVERNMENT.
BUT WHAT IS INTERESTING IS WE ARE SITTING ON WHAT 14.7 ACRES?
>> CAN YOU GIVE ME A COST BENEFIT ANALYSIS OR WHOEVER CAN? WHAT DOES THAT MEAN TO THE MARKET IN DALLAS RIGHT NOW? BECAUSE IF WE'RE LOOKING AT OPTION THREE, I THINK THAT'S WHERE YOU LOOK AT WHAT IS OUR COST BENEFIT HERE IF WE DO RELOCATE? WHAT DOES THIS BRING TO THE TABLE? WHAT ARE THOSE MARKET CONDITIONS? I MEAN, THIS PART OF DALLAS IS GROWING.
I MEAN, WE KNOW THE CEDARS AND WE'RE ABOUT TO HAVE A PARK, AND IT IS PLANNED OUT.
>> THANK YOU. I THINK WE HAVE SOME FOLKS FROM ECONOMIC DEVELOPMENT CAN HELP ADDRESS YOUR COMMENTS, MRS BLACKMAN.
>> I'M NOT SAYING THAT EVERYTHING IS ONLY BASED ON DOLLARS, BUT THAT IS PART OF EQUATIONS THAT WE'VE BEEN TALKING ABOUT IS IF WE'RE GOING TO HAVE TO PAY UPWARDS OF 350 THAT YOU'VE TALKED ABOUT AS A GENERAL BACK OF THE NAPKIN.
BUT IF WE IF THERE'S ANOTHER BENEFIT TO THAT, THEN I THINK THAT NEEDS TO BE EXPLORED AS WELL.
>> I HAVEN'T DONE ANALYSIS OF THE CITY [OVERLAPPING].
>> CAN YOU INTRODUCE YOURSELF, PLEASE.
>> SORRY, ROBIN BENTLEY CITY MANAGER'S OFFICE.
BUT I CAN TELL YOU WE HAVE A SIMILAR PROPERTY COMING AVAILABLE WITH THE CONVENTION CENTER.
BY MOVING THE CONVENTION CENTER WILL FREE UP SOMEWHERE IN THE NEIGHBORHOOD 25 ACRES OF DEVELOPABLE PROPERTY RIGHT ACROSS THE STREET FROM CITY HALL.
IT'S DEFINITELY AN INTERESTING OPPORTUNITY TO THINK ABOUT THAT LARGER ENTERTAINMENT DISTRICT, AND THE INTEREST THAT WE'VE RECEIVED ON THE CONVENTION CENTER ACREAGE IS PROBABLY REFLECTIVE OF WHAT WE WOULD SEE ON THE CITY HALL PROPERTY.
>> WHAT YOU'RE SEEING IS LIKE WE'RE SEEING BASICALLY A BAND HERE BECAUSE WE HAVE THE CEDARS GROWING, AND YOU'VE GOT THE NORTHERN PART OF DOWNTOWN.
THIS IS THAT NEXT BAND WHERE WE CAN BE A VERY VALUABLE PLAYER IN THIS.
DOES THAT MEAN THAT WE'RE GOING TO PLAN IT OUT? HOW DOES THAT LOOK?
>> I WON'T SPEAK FOR THE REAL ESTATE DEPARTMENT, BUT I CAN'T IMAGINE WE WOULD JUST THROW
[00:55:01]
THIS PROPERTY ON A SURPLUS LIST AND AUCTION IT, RIGHT.WE WOULD WANT TO DEVELOP THIS IN A WAY THAT'S SUPPORTIVE OF WHAT WE'RE DOING AT THE CONVENTION CENTER.
THIS WOULD PROBABLY BE SOMETHING THAT THE ECONOMIC DEVELOPMENT TEAM WOULD WEIGH IN ON.
BUT THAT'S ALL LIKE JOHN SAID, HE JUST NEEDS TO KNOW WHICH DIRECTION TO GO, AND THEN I'LL BRING MY FOLKS IN IF THAT'S THE DIRECTION YOU ALL TELL US TO GO, BUT AT THIS POINT, WE HAVEN'T DONE ANY OF THAT WORK.
>> THESE REPAIRS THAT IN THE LAST ONE, THESE REPAIRS, WE DON'T HAVE THAT MONEY IN THE COFFERS, RIGHT? WE'D HAVE TO STAGE IT OUT, MAYBE BOND.
HOW DO WE GET READY TO MAKE THIS A LIVABLE BUILDING, IF THAT IS THE CASE?
>> I THINK YOU WOULD HAVE TO MAKE THE INVESTMENT.
THAT WOULD MEAN TOUGH CHOICES, AND THERE IS ONLY SO MUCH FUNDS THAT WE HAVE AVAILABLE TO US SO IT WAS VERY DIFFICULT FOR THIS BODY TO ALLOCATE $2 MILLION FOR US THIS YEAR TO IMPLEMENT PREVENTIVE MAINTENANCE, WHICH IS LIMITED ONLY TO THE FIRE STATIONS AND POLICE STATIONS, BUT THAT'S THE FIRST STEP IN MOVING US IN THE RIGHT DIRECTION AND SO HOW DIFFICULT THE TWO MILLION WAS NOW COMPARING EVEN ON THE LOW END TO 152 MILLION.
>> YEAH. I REMEMBER THE BOND DISCUSSION THAT WE HAD IN 24 ABOUT JUST SIMPLE MAINTENANCE HERE. THANK YOU.
>> ALL RIGHT. THANK YOU. I WILL, LET'S SEE MOVE ON TO CHAIR MENDELSON AND THEN WE'LL GET CHAIR ROTH, IF YOU WOULD LIKE TO SAY SOMETHING.
>> IN THE 47 YEARS, HOW MANY TIMES HAS THE ROOF BEEN REPLACED?
>> I DON'T KNOW THAT I HAVE THAT INFORMATION WITH ME.
>> FOR THE MAJOR SYSTEMS, DO WE ACCRUE FOR THE REPLACEMENT OF THOSE?
>> THAT WOULD BE A TYPICAL CAPITAL PLANNING SYSTEM THAT WOULD BE IN PLACE, BUT THAT'S NOT THE WAY THE CITY HAS OPERATED.
WE HAVE BEEN A RUN TO FAILURE ORGANIZATION.
>> I'VE TALKED ABOUT THIS SEVERAL TIMES WITH THE BUDGET THAT WE OUGHT TO BE ACCRUING FOR IT.
I PERSONALLY ACCRUE FOR THAT FOR MY HOUSE.
I HAVE A FUND FOR MY ROOF, I HAVE A FUND FOR ALL SORTS OF THINGS BECAUSE I KNOW MY AIR CONDITIONING UNITS ARE GOING TO GO OUT.
RIGHT? THE ROOF MIGHT HAVE A 40 YEAR GUARANTEE, BUT I KNOW WITHIN TEN YEARS, I'M GOING TO REPLACE THAT ROOF.
THE CITY NEEDS TO BE BUDGETING THAT WAY.
I'VE SAID THIS REPEATEDLY, AND IT'S UNACCEPTABLE TO SAY WITH A $5.2 BILLION BUDGET THAT WE DON'T HAVE THE FUNDS TO TAKE CARE OF OUR BUILDING.
WHAT PERCENT OF OUR CURRENT BUDGET IS FOR MAINTENANCE?
>> I DON'T KNOW THAT I HAVE A SPECIFIC OVERALL BUDGET, BUT IN THE FACILITIES IN REAL ESTATE, OUR 36 MILLION OPERATING BUDGET, AROUND 4.5 MILLION IS TO REPAIR AND MAINTENANCE.
>> I WOULD SAY THAT PERCENTAGE IS UNACCEPTABLE.
THE REALITY IS WE ARE NOT RUN BY THE CITY COUNCIL OR MAYOR.
WE ARE A CITY MANAGER FORM OF GOVERNMENT.
WE HAVE A PROFESSIONAL CITY MANAGER WHO SHOULD BE DEVELOPING A BUDGET THAT INCLUDES THE MAINTENANCE OF OUR ASSETS.
IF THAT'S NOT HAPPENING, THEN WE HAVE A VERY DIFFERENT PROBLEM, AND IT'S NOT ABOUT CITY HALL ITSELF.
BUT I WILL TELL YOU THE PHOTOS IN THIS PRESENTATION DO NOT REFLECT THIS BUILDING.
I HAVE YET TO SEE A SINGLE CRACK IN THIS BUILDING.
ALMOST EVERY HOUSE IN DALLAS HAS A CRACK FROM FOUNDATION.
THIS THING AS SOLID AS COULD BE.
DOES IT HAVE AN OCCASIONAL TOILET THAT OVERFLOWS? YES. BUT HAVE WE NOT CALLED PLUMBERS FOR OUR HOMES, BUT WE ALSO BUDGET FOR THAT MAINTENANCE, WHICH CLEARLY WE'RE NOT DOING.
THIS BUILDING IS NOT A FAILURE.
I THINK IT'S PRETTY SPECTACULAR AND IMPOSING AND GIVES YOU CONFIDENCE IN GOVERNMENT THAT WE'RE CLEARLY LOSING OUT ON.
I WOULD LIKE TO SEE A FRIDAY MEMO THAT INCLUDES HOW MUCH WE'VE ALLOCATED EVERY YEAR, I'LL SAY 2019, SINCE THAT'S THE YEAR THAT THE MAJORITY OF US OLD TIMERS, WERE ELECTED.
HOW MUCH WENT TO MAINTENANCE OF THIS BUILDING AND IN THE CITY.
I'M NOT TALKING ABOUT STREETS.
I'M TALKING ABOUT THE CITY BUILDINGS.
THIS IS NOT THE ONLY CITY BUILDING WE'RE TALKING ABOUT.
THERE'S A LOT OF CITY BUILDINGS WE'RE TALKING ABOUT.
WE HAVE FIRE STATIONS COLLAPSING.
I AM JUST ABSOLUTELY THIS IS A REAL ESTATE PLAY.
WE HAVE ALL SORTS OF DEVELOPERS IN THE AUDIENCE.
I KNOW YOU DON'T WANT TO TALK ABOUT IT, BUT IF THIS IS A CONVERSATION ABOUT THE MAVERICKS, THAT'S A VERY DIFFERENT CONVERSATION.
BUT TAKING CARE OF OUR BUILDING IS THE RESPONSIBILITY OF CITY GOVERNMENT AND FRANKLY, IT STARTS WITH A CITY MANAGER AND OUR CFO PROPOSING A BUDGET TO US THAT IS RESPONSIBLE FOR TAKING CARE OF OUR ASSETS.
>> CHAIR, I THINK WE'RE EATING A LITTLE BIT BEYOND THE TOPIC, WHICH IS THE STATE OF CITY HALL.
>> IN ADDITION TO OUTLINING IN THE BUDGET, THE MAINTENANCE THAT WE HAVE HAD THESE LAST YEARS,
[01:00:01]
ALSO, PLEASE INCLUDE THE BOND FOR 2017, HOW MUCH WENT TO CITY HALL, COUNCIL MEMBER BLACKMAN'S BRINGING UP FEBRUARY 14, 2024, THE DAY WE VOTED TO PUT THE BOND FOR 24 ON THE BALLOT.THAT WAS THE FIRST TIME OUR CITY MANAGER MADE A PLEA FOR DOLLARS FOR THIS BUILDING.
AT THE VERY ITEM THAT WE WERE ACTUALLY PUTTING IT ON, HE MADE A PLEA, A CHANGE.
BUT ALL THROUGH THAT BOND PROCESS, THERE WAS NO DISCUSSION TO COUNCIL.
MAYBE IT HAPPENED IN A SUBCOMMITTEE, NO DISCUSSION TO COUNCIL ABOUT THE URGENT NEED FOR MAINTENANCE.
SUDDENLY, AND IN FACT, AT THAT MEETING, THE MAXIMUM AMOUNT, I BELIEVE JOHN YOU SAID WAS IT COULD POSSIBLY BE WOULD BE 100 MILLION.
THAT WAS FEBRUARY 14, 2024 AND NOW WE'RE TALKING ABOUT OVER 300 MILLION.
I THINK THAT STAFF IS STEERING US TO GET RID OF THIS BUILDING.
I THINK YOU WANT IT FOR OTHER USES.
THIS SHOULD NOT BE AN ECONOMIC DEVELOPMENT CONVERSATION.
AT THE TIME, I WILL REMIND YOU THAT OUR FORMER CITY MANAGER SAID THAT HE DIDN'T EVEN HAVE $5 MILLION TO DO THE ASSESSMENT.
LET ALONE FIX THE BUILDING, BUT NEVER PUT FORWARD A PROPOSAL TO MAKE THOSE THINGS HAPPEN.
I'M GOING TO CHALLENGE YOU, DO THE WORK THAT WE NEED YOU TO DO.
WE DON'T NEED ALL THE SHINY THINGS. WE DON'T.
WE NEED TO FIX AND MAINTAIN AND KEEP THE THINGS THAT WE HAVE.
A CONVENTION CENTER LESS THAN 50-YEARS-OLD OR TEARING DOWN AND REDOING IS INSANE.
TO DOWNMOVE IT FURTHER DOWNTOWN, WHAT ABOUT THE LIBRARY? THIS IS A PAIRED BUILDING WITH IT.
WE HAVEN'T EVEN TALKED ABOUT THAT.
IS THAT NEXT? I'M VERY FRUSTRATED ABOUT THIS ENTIRE TOPIC.
UNLESS YOU GOT TO DEAL WITH THE MAVERICKS, I DON'T REALLY WANT TO TALK ABOUT IT.
>> ALL RIGHT, COUNCIL MEMBER. JACK, DO YOU HAVE SOMETHING YOU [OVERLAPPING].
>> I JUST WANTED TO MAKE A COMMENT IF I COULD ON PART OF IT.
I RESPECT AND APPRECIATE THE COMMENTS ABOUT US AS A CITY NOT INVESTING AS MUCH AS WE SHOULD IN BUILDING MAINTENANCE.
WE HAVE ACKNOWLEDGED THAT AND MR. JOHNSON, I BELIEVE, DID A PRESENTATION PRIOR TO JULY RECESS ABOUT THE FACILITY NEEDS AND IT'S AN AREA THAT WE ACKNOWLEDGE THAT NEEDS MORE FUNDING.
AS YOU KNOW, EVERY YEAR WITH THE BUDGET, WE DEAL WITH A LOT OF COMPETING PRIORITIES.
THIS YEAR WE DID FUND THE CONDITION ASSESSMENT SO THAT WE REALLY HAVE AN UNDERSTANDING OF WHAT THOSE NEEDS ARE, AND HOPE THAT WE WILL BE ABLE TO ADDRESS THAT IN A DIFFERENT WAY IN THE FUTURE. THANK YOU.
>> THANK YOU. MR. ROTH, DID YOU HAVE QUESTIONS? GREAT.
>> THANK YOU FOR ALLOWING ME TO PARTICIPATE.
IT SEEMS TO ME THAT THE DECISION TREE IS REALLY BASED ON WHETHER OR NOT THE BUILDING STRUCTURALLY IS VIABLE OR NOT.
IF THE BONES OF THE BUILDING ARE NOT VIABLE, THEN YOU CANNOT REMODEL, YOU CANNOT RENOVATE, YOU CANNOT UPDATE.
THAT BECOMES AN EQUAL DECISION OF BUILDING NEW VERSUS REMODELING.
IF THE STRUCTURE HAS INTEGRITY HAS THE ABILITY TO HAVE LONGEVITY, THEN THE DECISION TREE HAS TO BE ANALYZED A LITTLE BIT DIFFERENTLY IN MY PERSONAL OPINION, AND I'M NOT AN ENGINEER, AND I DON'T PRETEND TO BE AN ARCHITECT OR A CONSTRUCTION PEOPLE, ALTHOUGH WE DO DEAL WITH BUILDINGS.
SO TO DOVETAIL ON SOME OF THE COMMENTS I MADE, I THINK THAT A STRUCTURAL ENGINEERING ANALYSIS IMMEDIATELY, AND THIS DOESN'T TAKE A YEAR TO DO.
WE'RE SPENDING LOTS AND LOTS OF MONEY ON CONSULTANTS AND ON PROFESSIONAL SERVICES.
I HAVE A FEELING THAT WE SHOULD BE ABLE TO GET SOMEBODY COST EFFECTIVELY TO DO AN ANALYSIS OF THIS BUILDING TO SEE IF THE BONES ARE OKAY.
THAT DOES NOT APPLY TO THE AIR CONDITIONING, TO THE ELECTRICAL.
WE'RE TALKING ABOUT THE FOUNDATION AND THE STRUCTURE.
IF THE FOUNDATION IN THE STRUCTURE IS INTACT, THEN WE'D GO TO THE NEXT QUESTION OF, DO WE REMODEL? DO WE IMPROVE? DO WE MAKE A DIFFERENT DECISION? BECAUSE THEN IT BECOMES AN ECONOMIC AND A FUNCTIONAL ISSUE? IF THE STRUCTURE IS NO LONGER GOOD, THEN THAT'S AN EASY DECISION BECAUSE THEN IT BECOMES A DECISION ON BUILDING, RENTING, RELOCATING, OR DOING SOMETHING DIFFERENT.
I THINK THE CRITICAL ISSUE RIGHT NOW IS TO GET THE FACTS AND THE FACTS ARE, LET'S FIND OUT IF THE BUILDING CAN STAND UP.
SECOND OF ALL, TO GO AND BUILD SOMETHING NEW,
[01:05:03]
IT'S PROBABLY AND I DON'T PRETEND TO KNOW THE NUMBERS.BUT MY GUESS IS TO BUY 15 ACRES OF LAND IN DALLAS, TEXAS, DOWNTOWN AND TO BUILD A MILLION SQUARE FOOT BUILDING.
IS GOING TO COST 300 MILLION TO $400 MILLION.
WE'RE SEEING THAT SOME OF THE REDEVELOPMENTS DOWNTOWN ARE ALREADY INDICATING THAT THOSE ARE THE NUMBERS THAT PEOPLE ARE DOING TO RENOVATE BUILDING.
I THINK THAT'S ALSO GOING TO BE A TOUCHSTONE FOR THIS GROUP TO UNDERSTAND WHAT THE GENERAL NUMBERS ARE DON'T HAVE TO BE SPECIFIC, BUT THE GENERAL NUMBERS AND THE DEBT SERVICE AND THE COST ASSOCIATED WITH THAT.
AGAIN, THIS IS NOT A SCARY THING, IT'S NOT SOMETHING THAT WE HAVE TO BE AFRAID OF, BUT WE HAVE TO BE ATTENTIVE TO THE FACTS.
A LOT OF THE INFORMATION THAT'S BEING PROVIDED IN THESE TOTALS HAVE TO BE IN THE DEFERRED MAINTENANCE.
PART OF THESE ARE STRUCTURAL COST.
PART OF THESE ARE REPAIR COSTS, AND THAT'S WHERE THESE NUMBERS ARE A LITTLE BIT CONFUSING, AND I'M SAYING THAT NICELY TO ME.
STRUCTURAL WATER INFILTRATION AND GARAGE STRUCTURE IS NOT A REPAIR COST.
IF YOU TAKE OUT THOSE 100 MILLION AND THAT 245 MILLION OUT OF THOSE NUMBERS, YOU REPAIR COSTS ARE 50 MILLION AND 100 MILLION FOR NONSTRUCTURAL STUFF.
THOSE ARE DIFFERENT NUMBERS, FOLKS, AND WE HAVE TO LOOK AT IT IN A DIFFERENT WAY.
ANYWAY, AGAIN, I APOLOGIZE FOR NOT BEING PREPARED OR FOR UNDERSTANDING THIS IN MORE DETAIL, BUT I WOULD MY ACTION ITEM, IF I WAS MAKING A SUGGESTION WOULD BE THAT THE STRUCTURAL ENGINEERING OF THIS BUILDING NEEDS TO BE DONE IMMEDIATELY AND NEEDS TO BE A PRIORITY, AND THEN WE COME BACK AND DECIDE, WHAT IS THE ACTION PLAN?
>> WE'RE GOING TO GO THROUGH HOPEFULLY A LITTLE BIT OF A RAPID FIRE AROUND TWO.
I AGREE WITH MAYOR PRO TEM'S EARLIER COMMENTS ABOUT HOW OPTION 1 IS NOT AN OPTION.
I DON'T THINK OUR COUNCIL SHOULD BE KICKING THIS CAN DOWN THE ROAD ANYMORE THAN WE ALREADY HAVE, AND PAST DECADES OF COUNCILS AND CITY MANAGEMENT HAS KICKED THIS DOWN THE ROAD.
WE NEED TO MAKE A DECISION AND EITHER CHOOSE TO STAY HERE AND PROPERLY INVEST AND PRESERVE THIS BUILDING, OR WE NEED TO DO SOMETHING ELSE.
I WOULD JUST ASK IF MY COLLEAGUES FEEL COMFORTABLE STATING YOUR FEELING ON THAT, WHEN YOU COME UP, PLEASE DO SO, BUT NO PRESSURE ON THAT.
I ALSO WANT TO GIVE STAFF AN OPTION TO ADDRESS WHAT'S COME UP WITH JUST ABOUT EVERYBODY UP HERE IS THE TIMELINESS OF DOING SOMETHING.
OBVIOUSLY, THE DEFERRED MAINTENANCE IS WHAT WE'RE MOSTLY TALKING ABOUT.
BUT THERE'S ALSO MARKET CONDITIONS THAT ARE HAPPENING RIGHT NOW IN THE CITY, THE STATE OF DOWNTOWN, THE FACT THAT THE CONVENTION CENTER IS UNDERGOING ITS MASTER PLAN.
I UNDERSTAND YOU DONZELL HAD SAID YOU WOULD MAYBE HAVE SOMEONE HERE WHO CAN HELP US WITH THAT OR MAYBE THAT'S YOU WHO CAN TALK TO US ABOUT JUST LIKE WHY STAFF FEELS THERE IS A TIMELINESS ISSUE BEYOND JUST THE DEFERRED MAINTENANCE WE SHOULD CONSIDER.
>> THANK YOU FOR THE QUESTION, CHAIR WEST.
I WOULD ASK ACM ROBIN BENTLEY TO HELP SUPPORT THAT, ROSA FLEMING, WHO'S THE DIRECTOR OF CONVENTION AND EVENTS SERVICES.
>> APOLOGIES, CHAIR. WHAT WAS THE QUESTION?
>> THE QUESTION IS, EVERYONE PRETTY MUCH HAS TALKED ABOUT THIS BEING A TIMELINESS ISSUE, DECIDING WHETHER WE STAY HERE, WHETHER WE GO.
A BIG PART OF THAT IS THE DEFERRED MAINTENANCE, OF COURSE, BUT BEYOND THAT, THE MARKET CONDITIONS THAT EXIST CURRENTLY, THE FACT THAT THE CONVENTION CENTER IS UNDERGOING A MASTER PLAN.
AREN'T THOSE REASONS WHY THIS HAS BEEN THE FIRST REAL ESTATE DISCUSSION WE'VE HAD ON THIS COMMITTEE PER YOUR SUGGESTION.
>> SO DONZELL, I'VE HAD A FEW CONVERSATIONS ABOUT ESSENTIALLY, IF YOU ALL WANT TO MOVE FORWARD WITH OPTION 3, WHAT WOULD WE NEED TO LOOK AT? YOU'RE RIGHT, THE CONVENTION CENTER COMING ONLINE IN FEBRUARY 2029, IF WE'RE GOING TO CO DEVELOP A LARGER DISTRICT, THAT IS SOME INTERESTING TIMING.
CITY HALL, I THINK I SAW IN JOHN'S PRESENTATION, THE OFFICE SPACE IS ABOUT 400,000 SQUARE FEET.
I COULD PROBABLY NAME OFF THE TOP OF MY HEAD FIVE TO TEN BUILDINGS DOWNTOWN THAT HAVE THAT MUCH AVAILABILITY.
THE MARKET IS VERY FAVORABLE RIGHT NOW FOR US TO TAKE A BIG BLOCK OF DOWNTOWN OFFICE SPACE.
I THINK THAT'S TRUE, PROBABLY IN EVERY MAJOR DOWNTOWN.
BUT AS FAR AS, GENERAL MARKET CONDITIONS, I WOULD NEED TO TALK TO AN EXPERT.
THAT'S NOT SOMETHING WE'VE DONE A LOT OF RESEARCH ON.
I KNOW THERE ARE A LOT OF THEM IN THE AUDIENCE TODAY.
[01:10:01]
WE'VE TALKED WITH ERIC FLEISS A LITTLE BIT ABOUT SOME OF THIS.I THINK I DON'T KNOW IF ERIC'S HERE AND WANTS TO SPEAK MORE GENERALLY, BUT.
>> IT'S AN OPPORTUNITY TO PHONE A FRIEND IF YOU'D LIKE TO.
>> ERIC. WHO IS IT THIS COMING?
>> ERIC FLEISS FROM REGENT PROPERTIES.
>> THANK YOU. SOMETIMES YOU NEED TO PULL THE MIC UP A LITTLE BIT INTRODUCE YOURSELF, PLEASE.
>> THANK YOU. HI. MY NAME IS ERIC FLEISS AND THE CEO OF REGENT PROPERTIES.
AMONG OTHER THINGS. WE'RE A REAL ESTATE DEVELOPER WHO OWNS TRAMMEL CROW CENTER.
>> SO CAN YOU ANSWER THE QUESTION JUST ABOUT GENERALLY, IF COUNSEL CHOSE OPTION 3, WHAT THAT WOULD LOOK LIKE FOR MARKET CONDITIONS, MOVING OUR ABILITY TO GET A GOOD NEGOTIABLE DEAL IN THE TOWER.
ANYTHING WE SHOULD BE THINKING ABOUT AS WE WEIGH DECISION 2 AND 3.
I DON'T THINK IT'S A SURPRISE TO ANYONE IN THIS ROOM THAT DOWNTOWN OFFICE BUILDINGS ARE SUFFERING IN MANY DOWNTOWNS.
THAT MEANS THAT THE OPPORTUNITY IS THERE TO GET QUALITY SPACE AT A SIGNIFICANT DISCOUNT.
MY BUILDING, LET ME BE VERY CLEAR, WE'RE 90% LEASED.
MY ONLY INCENTIVE IN COMING HERE TODAY IS TO BE CONCERNED CITIZEN.
BUT OF THE MANY OPTIONS THAT ARE OUT THERE, THE ROUGH MATH, GIVEN THE GOOD WORK THAT STAFF DID IS THAT THE CITY COULD SAVE SOMEWHERE BETWEEN PROBABLY UP TO 80%, PROBABLY SOMEWHERE 60-80% OF THE ESTIMATED OCCUPANCY COSTS THAT YOU SAW ON THAT PAGE 7 OVER THE NEXT 10 YEARS.
>> THANK YOU. I'M GOING TO JUST ASK YOU TO STICK AROUND IN CASE ANY OF MY COLLEAGUES HAVE QUESTIONS FOR YOU? I'M GOING TO MOVE OVER TO VICE CHAIR STEWART.
>> THANK YOU, CHAIR, WEST. YOU'VE ASKED US JUST TO WEIGH IN ON THE THREE ALTERNATIVES.
I JUST THINK ONE IS OUT OF THE QUESTION.
WE CAN'T JUST CONTINUE LIKE WE'VE BEEN DOING.
OPTION 2, MY QUESTION IS GOING TO BE WHERE? WHAT'S THE SOURCE OF FUNDS? I KNOW WE'RE SAYING BONDS, BUT THAT MEANS WE'RE DOING THESE REPAIRS OVER A NUMBER OF YEARS.
WOULD OUR CFO LIKE TO WEIGH IN ON THE SOURCE OF FUNDS?
>> YES, MA'AM, THANK YOU. JACK IRELAND CHIEF FINANCIAL OFFICER.
FOR ABOUT THE LAST SEVEN YEARS, THE CITY MANAGER'S RECOMMENDED BUDGET HAS MADE MODEST INCREASES IN THE AMOUNT THAT WE FUND EACH YEAR FOR BUILDING MAINTENANCE.
IT'S FAR SHORT OF WHERE WE NEED TO BE.
BUT WE HAVE BEEN INCREASING IT.
JOHN, HELP ME OUT, IT PROBABLY ABOUT $10 MILLION OR SO THAT WE HAVE ALLOCATED TO YOUR DEPARTMENT FOR THE NEXT YEAR.
>> BY USING PROCEEDS FROM THE SALE OF SURPLUS PROPERTY, WE'VE MADE AVAILABLE FUNDS FOR MAINTENANCE OF CITY FACILITIES.
BUT WITH 500 OR SO BUILDINGS, IT'S CLEARLY NOT ENOUGH.
OUR PRIMARY SOURCE OF FUNDS WOULD BE FROM BOND PROGRAM.
WE ARE CURRENTLY ABOUT TO ISSUE THE SECOND TRANCHE OF OUR 2024 BONDS.
THE PLAN WAS TO ISSUE THOSE IN '25, '26, '27, '28, AND '29.
THE NEXT BOND PROGRAM WOULD PROBABLY COME ONLINE FOR FISCAL YEAR 30.
AS WE'VE LOOKED AHEAD, WE HAVE CAPACITY TO ISSUE DEBT IN THE NEXT BOND PROGRAM AGAIN, OF ABOUT $1.2 BILLION.
BUT THE FIRST BONDS THAT WOULD BE SOLD UNDER THAT NEW BOND PROGRAM WOULD BE FIVE YEARS OUT, IF YOU WILL.
BUT IT WOULD BE FROM A GENERAL OBLIGATION BOND PROGRAM.
IT WOULD REQUIRE COUNCIL TO PUT THAT BEFORE THE VOTERS AND SEEK VOTER APPROVAL FOR THAT TYPE OF DEATH THOUGH.
I WILL SAY, MAINTENANCE OF CITY HALL DOESN'T TYPICALLY DO WELL AS IT GOES THROUGH THE BOND PROCESS.
I THINK THEY MADE SOME RECOMMENDATIONS.
BUT WE DID NOT ALLOCATE NEAR WHAT I THINK THAT COMMITTEE HAD HOPED WE WOULD ALLOCATE TOWARDS MAINTENANCE OF OUR BUILDING.
IT'S NOT THE BRIGHT AND SHINY, AND WE DO TEND TO FOCUS ON THAT.
I DO THINK WE ALSO FOCUS ON THE NEEDS OF OUR RESIDENTS, AND THOSE NEEDS ARE PUBLIC SAFETY, AND THERE ARE PRESSURE POINTS ON OUR BUDGET WITH RESPECT TO PUBLIC SAFETY.
WE ARE GOING TO CONTINUE TO SPEND AND SHOULD CONTINUE TO SPEND SIGNIFICANT AMOUNTS OF OUR BUDGET ON PUBLIC SAFETY AND WITH SOME BOND FUNDS AS WELL GOING TOWARDS THE ACADEMY.
THERE'S JUST SO MANY DEMANDS ON THIS BUDGET AND ON OUR FINANCIAL FINANCES.
IT'S VERY DIFFICULT FOR ME TO LOOK AT RESIDENTS AND PRIORITIZE, OUR HVAC.
OH, MAN, I CANNOT SAY THAT THIS AFTERNOON.
[01:15:01]
IT'S BEEN A LONG DAY ALREADY, HVAC SYSTEM.PRIORITIZE THAT OVER THE LIBRARY IN MY DISTRICT OR THE LIBRARY IN SOMEBODY ELSE'S DISTRICT.
IT'S FIVE YEARS AWAY AT BEST IN TERMS OF FINDING THE SIGNIFICANT FUNDS THAT WE NEED.
TWO, STAYS ON THE TABLE FOR ME, BUT THREE BEGINS TO BE MORE ATTRACTIVE BECAUSE MAYBE WE ARE THEN FREED UP TO SPEND OUR RESOURCES IN THE AREAS THAT WE KNOW OUR RESIDENTS ARE ASKING US TO SPEND THEM, AND THAT IS ON OUR STREETS, PUBLIC SAFETY, IN OUR LIBRARIES, IN OUR PARKS AND REC SYSTEM, QUALITY OF LIFE AS WELL AS SAFETY.
IT'S A DIFFICULT DECISION. THERE'S NO QUESTION.
THIS IS NOT A SLAM DUNK CLEAR PATH.
BUT I THINK OPTION 2 JUST HAS A LOT OF ENTANGLEMENTS.
THANK YOU, CHAIR WEST. THANK YOU, DEPUTY MAYOR PRO TEM.
>> THANK YOU. BEFORE WE GET INTO THE OPTIONS.
ON PAGE 27, THERE ARE A NUMBER OF PROPERTIES THAT WERE UNDER CONSIDERATIONS FOR NEXT STEPS.
HAVE WE BEEN APPROACHED BY THESE PROPERTIES? OR THESE JUST ONES THAT WE ARE SPECULATING.
>> NO, MA'AM. THERE'S BEEN NO DISCUSSIONS, NO SPECULATING, NO DISCUSSIONS ABOUT LEASING ANY SPACE AT ALL.
THEY'RE PROBABLY SURPRISED THAT THEY'RE BUILDINGS IN THIS BRIEFING. [LAUGHTER]
>> I WAS WONDERING ABOUT THAT. HOWEVER, IF THE CLIMATE IS THAT WE MAY BE LOOKING TO MOVE A LARGE OPERATION, THERE WOULD BE INCENTIVES THAT WOULD COME WITH THAT.
I WOULD HOPE THAT IT WOULD BE COMPETITIVE TO GET THIS CITY HALL MOVED TO THEIR LOCATION.
>> FOR SURE. GREAT. THAT'S SOMETHING TO CONSIDER.
I TOO, I'M A HARD NO ON NUMBER 1.
ON OPTION 2, I HAD MENTIONED THE PHASING AND JUST UNDERSTANDING WHAT THIS WOULD MEAN TO GET A GRASP OF HOW WE COULD EVEN HANDLE THIS.
HOWEVER, WHEN WE TALK ABOUT SINKING MORE MONEY INTO SOMETHING THAT COULD LITERALLY BE SINKING, I DON'T KNOW HOW MANY STUDIES AND THAT THING.
I'D LIKE TO INVEST IN IF THESE NUMBERS ARE AS BIG AS THEY ARE, AND WE'RE JUST NOT EVER GOING TO BE ABLE TO GET AT THEM.
ANOTHER CONSIDERATION IS THAT THIS IS LIKE THE OLD SAYING WHERE THE COBBLERS CHILDREN HAVE NO SHOES.
IF THE CITY HALL CAN'T EVEN MAKE IT OUT OF OUR OWN INTERNAL BOND PROCESS ONTO A BALLOT, AND THEN WE PUT IT BEFORE VOTERS. THAT'S A GAMBLE.
THERE'S NO GUARANTEE THAT THAT'S GOING TO PAY OUT.
I THINK WE HAVE TO BE REALISTIC ABOUT THIS.
BUT WHEN I LOOK AT OPTION 3, AFTER WE UNDERSTAND THE PHASING ASPECT OF OPTION 2, JUST THE OPPORTUNITY TO COMBINE THIS WITH SOMETHING VERY EXCITING HAPPENING AT THE CONVENTION CENTER AND WHAT THAT'S GOING TO DO TO THIS PART OF DOWNTOWN, AND THEN DOUBLING DOWN ON THAT BY MOVING INTO POTENTIALLY A LOCATION THAT WE COULD REINVIGORATE ANOTHER PART OF DOWNTOWN.
THAT SEEMS PRETTY EXCITING TO ME FOR DOWNTOWN DALLAS.
IF WE'RE GOING TO MAKE AN INVESTMENT OF A MAGNITUDE, BUT HERE, IT'S NOT REALLY GOING TO BE SOMETHING YOU SEE OR THAT THE PUBLIC SEES VERSUS SOMETHING THAT THEY COULD SEE AND TAKE PART IN.
I THINK I WOULD LEAN THAT DIRECTION.
BUT AGAIN, I THINK WE NEED A LITTLE BIT MORE INFORMATION ON OPTION 2 TO UNDERSTAND WHAT THE GAITING IMPACT WOULD BE, BUT I AM DEFINITELY OPEN TO OPTION 3. THANK YOU.
>> THANK YOU, CHAIRMAN GRACIE.
>> THANK YOU. I HAVE A JOKE, BUT I'M NOT GOING TO SAY IT.
I WANT TO SAY IT SO BAD. I'M NOT.
>> OPTION. BUT NO, I'LL TELL YOU BEHIND CLOSED DOORS.
I'M GOING TO MOVE AND GO WITH OPTION 3.
I'M NOT GOING TO SUGARCOAT IT TO BEAT AROUND THE BUSH OR ANYTHING LIKE THAT.
I THINK YOU KNOW THE OPPORTUNITIES FROM A BUSINESS PERSPECTIVE AND ALL OF THAT.
THIS IS THE FINANCE COMMITTEE.
FROM A FINANCE PERSPECTIVE, I THINK WE OWE IT TO OURSELVES TO REALLY EXPLORE THE OPTION OF SEEING WHAT THE IMPACT COULD BE AND JUST SO AND I KNOW IT GOES WITHOUT SAYING BECAUSE WE HAVE ALL OF THE MANY BRILLIANT FOLKS ON STAFF, BUT I JUST NEED TO FOR THE RECORD, SAY EXPLORE IT, BUT ALSO TO SOME OF MY COLLEAGUES POINTS, ACTUALLY, LET'S DO THE FULL ASSESSMENT, WHICH I'M ASSUMING, EXPLORING THIS WOULD MEAN DOING A FULL ASSESSMENT OF THIS FACILITY TO SEE WHAT THOSE ACTUAL REPAIRS ARE, BECAUSE ONE OF THE THINGS I'M CURIOUS TO SEE IS ON THE OTHER SIDE OF THIS, IF WE DO MOVE, AGAIN, WHAT IS THE ECONOMIC IMPACT? IN THIS SURROUNDING AREA, WHAT IS GOING TO BE THE FULL COST OF DEFERRED MAINTENANCE, IS WHERE I STARTED WITH THIS.
WHAT IS IT GOING TO COST TO ACTUALLY
[01:20:01]
REALLY TAKE CARE OF THESE NEEDS AND BRING IT UP TO DATE? HOW LONG WOULD THAT ACTUALLY TAKE AND WHAT WOULD WE MISS IN TERMS OF ECONOMIC OPPORTUNITY OVER THAT TIME FRAME? THEN FINALLY, AS WE EXPLORE OTHER LOCATIONS, OBVIOUSLY, WE'VE GOT SOME GOOD CASE STUDIES TO KNOW THE MISTAKES, NOT TO DO, WHICH GOES TO SOME OF MY JOKES.BUT ALSO, I KNOW WE HAVE THAT LIST OF PROPERTIES DOWNTOWN, BUT DON'T BE AFRAID TO REALLY EXPLORE A LITTLE BIT BEYOND DOWNTOWN TO SEE IF THERE ARE SOME OTHER OPPORTUNITIES AS WELL.
I DON'T WANT TO GET US BOUND IN IT, BECAUSE TO THE GENTLEMEN'S POINT, THIS MARKET IS PRIMING FOR A MOVE LIKE THIS.
WE DON'T KNOW HOW LONG THAT'S GOING TO BE, BUT ALSO IT MAY BE EVEN BETTER IN AREAS JUST A LITTLE BIT FURTHER OUTSIDE OF DOWNTOWN. THANK YOU.
>> THANK YOU, CHAIR. [NOISE] DO WE KNOW WHAT THE COST WOULD BE FOR THE FACILITY CONDITION ASSESSMENT?
>> WE DO HAVE MULTIPLE FUNDING SOURCES INCLUDED IN THIS OPERATING BUDGET, BUT IT IS MY PREFERENCE NOT TO PUT THAT OUT PUBLICLY BECAUSE WE HAVEN'T BID IT OUT YET, SO I'M HAPPY TO MEET WITH YOU SEPARATELY OFFLINE.
>> SURE. I HAVE HEARD ROUGH ESTIMATES.
I WOULD BE CONCERNED ON DOING THAT IF THE CONSENSUS OF THIS BODY IS TO DO ANOTHER OPTION, I DON'T SEE HOW THAT BRINGS ANY VALUE TO THE CONVERSATION.
YOU MIGHT NOT HAVE THESE NUMBERS, BUT IF WE DID INVEST $350 MILLION INTO CITY HALL, DO WE KNOW WHAT THE REAL ESTATE VALUE WOULD BE? KNOWING THAT THERE'S THE REAL ESTATE VALUE, BUT THEN THERE'S ALSO THE HISTORICAL VALUE THAT COMES WITH IT.
BUT JUST STICKING TO HARD NUMBERS, IF WE REALLY INVEST $350 MILLION DOES THAT MEAN THIS BUILDING IS NOW WORTH $0.5 MILLION OR UPWARDS?
>> THAT'S AN EXCELLENT QUESTION.
I THINK THAT'LL BE PART OF THE ANALYSIS THAT WE'LL HAVE TO BRING BACK ABOUT WHAT THE RETURN ON THE INVESTMENT IS, INVESTING DOLLARS IN CITY HALL VERSUS ANOTHER OPTION.
I THINK YOU BRING A POINT THAT'S A HOME RUN IN THE DECISION-MAKING PROCESS ABOUT HOW TO WEIGH THAT DECISION.
>> AS WE TALK ABOUT 15 ACRES, WE DON'T NECESSARILY NEED 15 ACRES IF WE WERE TO HAVE A CITY HALL SOMEWHERE ELSE, ESPECIALLY IN THE DOWNTOWN CORE.
YES, CIVIC PLACES ENGAGEMENTS ARE IMPORTANT, BUT WE'VE INVESTED MILLIONS OF DOLLARS INTO OUR DOWNTOWN PARKS, WHICH NOW ACT AS A HUB FOR GATHERINGS.
I WANT TO MAKE SURE THAT WHATEVER ROAD WE GO DOWN, WHETHER WE DECIDE TO STAY HERE, THAT WE POTENTIALLY LOOK AT REDUCING THE ACREAGE, OR IF WE DO FIND A SPACE THAT IS LACKING A PUBLIC GATHERING SPACE, IT'S NOT A MUST BECAUSE WE HAVE INVESTED SO MUCH INTO OUR PARKS.
QUESTION, IF WE WERE TO DO A REPAIR AT CITY HALL WOULD WE HAVE TO GO BACK OUT TO GET A CERTIFICATE OF OCCUPANCY FOR A FLOOR, AND WOULD WE GET A CERTIFICATE OF OCCUPANCY IF THERE'S ALL THESE OTHER MAJOR ISSUES WITH THE BUILDING?
>> I DON'T KNOW WE HAVE A CURRENT CERTIFICATE OF OCCUPANCY.
WE WOULD NEED A PERMIT FOR ANY OF THE WORK, WHAT WAS IN SCOPE.
WE WOULD HAVE TO COMPLY WITH THE CURRENT CODE AND MAKE SURE THAT IT WAS UP TO THE STANDARD BEFORE WE WOULD BE APPROVED.
>> LAST QUESTION, CHAIR, IS, DO WE KNOW WHAT THE TAX VALUE WOULD BE IF THESE 15 ACRES WERE PUT BACK ON THE PRIVATE MARKET?
>> I DON'T KNOW THAT WE WOULD DISCUSS THAT IN OPEN SESSION.
WE COULD DO SOMETHING LIKE THAT AT SOME POINT, MAYBE IN THE FUTURE IN EXECUTIVE SESSION.
BUT AGAIN, I THINK WHAT YOU BRING UP, AND WHAT VALUE THIS BUILDING WOULD HAVE IN SOME FUTURE STATE, DEPENDING ON WHAT DECISION THE COUNCIL DECIDED TO MAKE.
THAT WOULD HAVE TO BE A PART OF THE ANALYSIS TO HELP YOU GUYS MAKE THAT NEXT DECISION.
>> THESE 15 ACRES ARE CURRENTLY HOW MUCH ARE THEY BRINGING IN TO THE CITY OF DALLAS?
>> THEY'RE NOT ON THE TAX ROLLS.
I THINK I SEE YOUR POINT. THEY'RE NOT ON THE TAX ROLLS.
>> THANK YOU FOR THAT. I'M GOING TO MOVE ON TO CHAIRMAN JOHNSON.
LISTENING TO THE CONVERSATION AND LOOKING AT THE SLIDES HERE, AGAIN, IT BRINGS ME SOME CONCERN.
I KNOW WE HAVE A HISTORICAL VALUE CONCERNING THE BUILDING, WHICH IS IMPORTANT.
THEN A BUILDING THAT NEEDS, IT SEEMS MILLIONS OF DOLLARS OF INVESTMENT, IF WE'RE GOING TO RENOVATE, REPAIR.
[01:25:03]
TO STAY, I WAS LISTENING TO SOME OF MY COLLEAGUES, TALK CONCERNING PUBLIC SAFETY, MAKING SURE THAT OUR STREETS ARE TAKEN CARE OF.I'M LOOKING AT OPTION 3, AS THE CHAIR OF GOVERNMENT EFFICIENCY, I THINK THAT WE NEED TO MAKE SURE THAT WE'RE MAKING DECISIONS THAT IS EFFICIENT FOR OUR CITY.
FINANCIALLY, IT APPEARS THAT THIS BUILDING, AGAIN, I'M GOING TO USE THESE WORDS BEYOND LIFE EXPECTANCY.
WHEN I'M LOOKING AT THE PICTURES AND LISTENING TO CHAIRMAN WEST SAY THAT THE NON-COMPLIANCY WITH ADA, IT IS A CHALLENGE, AS CHAIR STEWART SAID.
IT IS A CHALLENGE, BECAUSE WE'RE HEARD THE VOICE OF OUR CONSTITUENTS IN EACH OF OUR DISTRICTS HAVE AWARE FACED WITH THIS CONCERNED THIS PROBLEM.
AGAIN, TO SEE THESE PICTURES, I KNOW CHAIRMAN [INAUDIBLE] SAID THAT SHE DOESN'T SEE A LOT OF CRACKS. I'M LOOKING AT THEM.
IN THIS FLIGHT I'M LOOKING AT THIS, AND I CAN ONLY LOOK AT THIS AND RELATED TO WHERE I CAME FROM.
I'M NOT TRYING TO BE THE DEAD HORSE, BUT THIS IS VERY SIMILAR TO WHAT WE IN THE COMMUNITY FOUGHT AGAINST, MAKING SURE THAT WE HAVE A BUILDING AND BUILDINGS THAT ARE NOT DEPLORABLE.
I WAS AT DALLAS ISD IN 2019, BUT I'M LOOKING AT THE SAME SITUATION, DIFFERENT BUILDING.
LISTENING TO THIS AND LOOKING AT SOME OF THE SAME THINGS THAT I'VE SEEN, I THINK, FOR ME, I'M NOT A FAN OF KICKING A CAN DOWN THE STREET, MAKING SURE THAT WE'RE PRUDENT AND EFFICIENT CONCERNING OUR CONSTITUENTS AND WHAT THEY'RE EXPECTING US TO DO.
MY OPTION WOULD BE OPTION 3, CHAIR. THANK YOU SO MUCH.
>> THANK YOU SO MUCH. WE'LL GO TO RIDLEY, BLACKMON, MENDELSOHN AND ROTH.
>> THANK YOU, MR. CHAIR. I WANT TO GO ON RECORD VERY CLEARLY, SUPPORTING OPTION 2, SUBJECT ONLY TO A STRUCTURAL INSPECTION, AS COUNCILMAN ROTH HAS SUGGESTED AS PART OF A CONDITION ASSESSMENT.
THAT'S SOMETHING THAT CAN BE CONDUCTED IN THE NEAR TERM.
I THINK IT WILL REVEAL THAT THIS BUILDING IS NOT A 50-YEAR THROWAWAY BUILDING.
THIS BUILDING CONSTRUCTED OF REINFORCED CONCRETE IS A 100 PLUS YEAR BUILDING.
THAT'S ITS EXPECTED LIFE EXPECTANCY.
WE'RE SHORT CHANGING THE BUILDING AND OURSELVES IF WE THINK IT'S A THROWAWAY BUILDING AFTER JUST 50 YEARS.
NOW, I THINK THERE IS A RISK THAT WE ARE CONTEMPLATING A RUSH TO JUDGMENT, EVEN BEFORE WE GET THE RESULTS OF A STRUCTURAL INSPECTION, LET ALONE AN INSPECTION OF THE OTHER SYSTEMS OF THE BUILDING.
WE PRIDE OURSELVES ON BEING DRIVEN BY DATA.
WELL, LET'S WAIT FOR THE DATA BEFORE WE DECIDE THAT CITY HALL IS SOMETHING WE CAN JUST DISCARD AND MOVE ON.
THIS IS NOT JUST A DOLLAR AND CENTS PROPOSITION, AFTER ALL.
THIS IS AN ICONIC BUILDING DESIGNED BY AN ICONIC ARCHITECT.
IT MAKES A STATEMENT ABOUT THE CITY OF DALLAS.
EVERYONE KNOWS CITY HALL, THEY KNOW HOW TO GET HERE, THEY KNOW HOW TO ACCESS THE BUILDING.
IF WE WERE TO MOVE INTO SOME ANONYMOUS OFFICE BUILDING, WE WOULD HAVE A REAL BURDEN IN DEMONSTRATING TO PEOPLE THAT THIS IS THE CENTER OF THE PEOPLE'S REPRESENTATIVES OF THE CITY OF DALLAS.
WE WOULD HAVE UNTOLD MILLIONS OF DOLLARS TO BUILD OUT AND ACCOMMODATE THE PEOPLE THAT WE GET FOR PUBLIC HEARINGS IN A CHAMBER LIKE THIS ONE.
THIS WOULD NOT BE EASY TO REPLICATE IN A STANDARD OFFICE BUILDING.
I AM A STRONG ADVOCATE FOR PRESERVING ICONIC BUILDINGS LIKE THIS ONE, AND I WOULD LIKE TO SEE US GATHER ALL OF THE DATA AND MAKE AN INFORMED DECISION BEFORE WE DISCARD THIS STRUCTURE. THANK YOU.
>> THANK YOU. COUNCILMAN BLACKMON.
>> THANK YOU. I DO HAVE ONE FINAL QUESTION.
IF YOU DID A STUDY, IT TAKES ABOUT HOW LONG, 30 DAYS, 60 DAYS?
>> DEPENDING ON THE COST, WE WOULD HAVE TO EITHER FORMALLY PROCURE IT, SO THAT'S AN ADDITIONAL TIME FRAME, I THINK IT'S AT MINIMUM SIX MONTHS, IF NOT LONGER.
[01:30:04]
>> THEN WE WOULD HAVE TO GO FIND THE MONEY.
>> WHICH IS ANOTHER FIVE YEARS, AND THEN THAT'S ANOTHER WHOLE BUNCH OF ISSUES.
JUST GETTING THAT EITHER A TAX RATIFICATION, ELECTION, A BOND, BUT PUTTING IN OUR BUDGET AND SOMETHING NEEDS TO BE CUT IN AND THEN YOU HAVE THIS DOCUMENT, YOU NOW NEED TO ACTUALLY DO THE WORK THAT'S IN THE DOCUMENT. IS THAT FAIR TO SAY?
>> WELL, WE WOULD MAKE A CASE TO SAY THAT WE SUPPORT THIS PROFESSIONALLY, AND WE WOULD ADD THE PAY FOR FUNDING TO THE CITY MANAGER AND/OR CITY COUNCIL.
>> LOOKING AT ONE IS DEFINITELY NOT AN OPTION, BUT CAN YOU BLEND TWO AND THREE.
CAN YOU DO A LITTLE BIT MORE DATA, DO AN ECONOMIC ANALYSIS, REALLY UNDERSTANDING WHAT THE ECONOMICS HERE IS WITH RELOCATING, WITH STAYING AND ALSO DOING A COST BENEFIT ABOUT RELOCATING.
WHAT IS OUT THERE IN THE MARKET? I THINK WE ARE AT A POINT WHERE WE WANT REAL INFORMATION NOW TO MAKE THIS DECISION TODAY.
I'M LEANING THREE, BUT I DO LOVE THIS BUILDING.
I REALLY THINK IT'S A COOL BUILDING, AND I AGREE 100 YEARS SHOULD BE THIS BUILDING, BUT THIS IS WHAT YOU GET WHEN YOU DON'T TAKE CARE OF IT.
YOU DON'T GET 100 YEAR BUILDING THAT SHOULD HAVE BEEN 100 YEAR WHEN YOU DON'T INVEST IN IT.
THAT BREAKS MY HEART BECAUSE IT IS PRETTY COOL.
WITH THAT BEING SAID, IF THERE'S A WAY THAT WE CAN LOOK AT, IF YOU MAYBE HAVE A SPECIAL CALL BEATING, I DON'T KNOW, BRING IT TO FULL COUNCIL, BUT IT'S IN THE CHARGE OF THE COMMITTEE.
BECAUSE I THINK THE MARKET IS RIPE AND READY TO GO, BUT I THINK THERE'S JUST A LITTLE BIT MORE HARD INFORMATION THAT MAY BE VALUABLE TO DECISION-MAKING, JUST MY THOUGHTS. THANK YOU.
>> THANK YOU, CHAIR MENDELSOHN.
>> THANK YOU. COUNCIL MEMBER RIDLEY SAID SOMETHING, IT MAKES A STATEMENT ABOUT CITY HALL.
MAKES A STATEMENT ABOUT OUR CITY BEING HERE.
I WILL SAY IT MAKES MORE THAN ONE STATEMENT.
THE BUILDING ITSELF IS A STATEMENT, BUT THAT WE WOULD EVEN CONTEMPLATE LEAVING THIS BUILDING TO GO TO SOME ANONYMOUS, NOT EVEN A CLASS A, POSSIBLY OFFICE BUILDING.
ARE YOU KIDDING ME? THAT IS NOT THE DALLAS, I KNOW.
>> YOU'RE EITHER TALKING ABOUT SPENDING A LOT OF MONEY TO PURCHASE A BUILDING OR ADDING AN ANNUAL EXPENSE FOR RENT THAT WE DON'T CURRENTLY HAVE, IS THAT CORRECT?
>> WE HAVE NOT EXCEEDED THE LIFESPAN OF THIS BUILDING.
WE DIDN'T EXCEED THE LIFESPAN OF THE CONVENTION CENTER.
THIS IS THE MOST SHORT SIGHTED THING I HAVE HEARD OF.
THE PHOTOS IN THE PRESENTATION ARE LARGELY ITEMS THAT HAVE ALREADY BEEN CORRECTED, CORRECT?
>> NO, MA'AM. ONLY THE LAST TWO EXAMPLES WERE REPAIRED, THE OTHERS WERE EXAMPLES OF CURRENT DEFERRED MAINTENANCE.
>> WHY WEREN'T THEY PUT IN THE BUDGET TO FIX? THIS IS NOT A BOND ISSUE.
>> AGAIN, MY ENTIRE OPERATING REPAIR BUDGET IS $4.5 MILLION.
IF THE ROOF IS 3.5 MILLION OF THAT, WHAT DO I DO FOR THE OTHER 499 BUILDINGS THROUGHOUT THE REST OF THE FISCAL YEAR?
>> WELL, I'M JUST GOING TO SAY THE INITIAL BUDGET SENT TO US, THE DRAFT BUDGET SHOULD NOT HAVE ONLY HAD 15 MILLION FOR YOU.
IT SHOULD HAVE PROBABLY HAD 50 MILLION, MAYBE MORE EVERY SINGLE YEAR.
BUT CERTAINLY 1% OF A BUDGET IS PROBABLY NOT EVEN SUFFICIENT.
BUT YOU'RE TALKING ABOUT A MINISCULE AMOUNT.
THERE'S NO CORPORATION THAT WOULD PUT THAT LITTLE MONEY INTO A BUDGET FOR THIS.
CHAIR, YOUR QUESTION WAS ABOUT WHICH WAY TO GO? THERE'S ONE OTHER CONSIDERATION THAT I REALLY HAVEN'T TALKED ABOUT, WHICH IS THERE HAVE BEEN COMMENTS THAT, WE NEED MORE OFFICE SPACE.
I THINK YOU KNOW WHERE I'M GOING TO GO WITH THIS.
I ENCOURAGE ALL THESE MEDIA CAMERAS.
GO WALK AROUND CITY HALL, AND YOU TELL ME IF WE NEED MORE OFFICE SPACE BECAUSE THE OFFICES ARE EMPTY.
WE HAVE GREATLY ADDED TO THE NUMBER OF STAFF IN THE SIX YEARS I'VE BEEN ON COUNCIL, THOUSANDS OF NEW STAFF MEMBERS.
THIS BUILDING IS EMPTY. GO WALK IT.
GO WALK DOWN CITY HALL, GO IN THE PARKING GARAGE. IT'S NOT FULL.
>> I DON'T KNOW WHY WE THINK WE NEED SO MUCH MORE SQUARE FOOTAGE. IT'S NOT BEING USED.
GO ACROSS TO THE LIBRARY, GO EACH FLOOR, GO IN THE BACK WHERE THE STAFF IS.
STAFF HAS ABOUT MORE THAN A THIRD OF THE SQUARE FOOTAGE ON EVERY FLOOR.
[01:35:03]
ARE YOU TELLING ME WE COULDN'T SPACE PLAN THAT AND PUT MULTIPLE DEPARTMENTS ACROSS THE STREET BECAUSE WE COULD.SHOULD WE DEFER MAINTENANCE FURTHER? OBVIOUSLY, NO.
BUT SHOULD WE LEAVE THIS BUILDING? OBVIOUSLY, NO. THANK YOU.
>> THANK YOU. MR. ROTH. YOU'RE GOOD? I'M GOING TO JUST SUM THIS UP BECAUSE WE HAVE OTHER THINGS TO TALK ABOUT HERE.
CAN YOU GO TO SLIDE 23 FOR A SECOND? I'M GOING TO TAKE WHAT A FEW OF MY COLLEAGUES HAVE SAID AND MAKE A SUGGESTION FOR STAFF.
SLIDE 23 ON MY DECK IN FRONT OF ME IS YOUR CONSIDERATIONS FOR NEXT STEPS.
YES. THIS IS IMPOSSIBLE TO READ ON THE SLIDE IN FRONT OF US, BUT THE HARD COPY, I CAN SEE IT, AND IT REALLY LAYS OUT THE CASE FOR REMAINING AT CITY HALL, LIKE THE FINANCIAL CASE.
I'VE HAD JUST ABOUT EVERYBODY, BUT I KNOW GRACIE HAD ASKED FOR A COST ANALYSIS OF STAYING HERE VERSUS THE OPPORTUNITY COST OF MOVING.
COUNCILWOMAN BLACKMAN HAD ASKED FOR THE COMPLETE ECONOMIC DEVELOPMENT ANALYSIS, ALONG WITH COST-BENEFIT, AND THE RENT ANALYSIS, WHAT IT WOULD COST US TO RENT.
MR RIDLEYHA HAD ALSO TALKED ABOUT THE FACILITY'S CONDITION ASSESSMENT COSTS.
I THINK YOU COULD SUM ALL OF THIS UP AND COUNCILWOMAN BLACKMAN'S HYBRID ON THIS SLIDE AND COMPARE STAYING AT CITY HALL VERSUS WHAT IT WOULD LOOK LIKE FOR US TO GO SOMEWHERE ELSE AND WHAT THE AVERAGE RENT MIGHT BE.
WE CAN SEE THE BREAKDOWN AT OUR NEXT MEETING, AND MAYBE IT'S THROUGH AN ECONOMIC DEVELOPMENT LENS AS WELL, BECAUSE I THINK THAT'S A PIECE OF THIS THAT WE'RE NOT TALKING ABOUT TODAY, BECAUSE WE DIDN'T NOTICE FOR IT.
>> TO ME, THIS IS A GREAT POINT TODAY.
I'VE MENTIONED A MEDIA THAT I WAS A FAN OF ROBOCOP, AND THAT'S WHAT WAS MY FIRST EXPOSURE TO CITY HALL BEFORE I EVEN MOVED HERE.
IT WAS, AND, OF COURSE, CITY HALL HAS SOME MEANING FOR ALL OF US IN DIFFERENT WAYS.
IT'S A BALANCING ACT OF ECONOMIC DEVELOPMENT, DEFERRED MAINTENANCE, AND OUR RESPONSIBILITY TO BE GOOD STEWARDS OF OUR TAXPAYER RESOURCES, AND ALSO THE HISTORICAL LONGEVITY OF OUR CITY AND THE PRESERVATION PIECE.
ALL OF THOSE WE NEED TO WEIGH IN, AND WE NEED TO BE ABLE TO TALK ABOUT THE ECONOMIC PIECE MORE THAN WE WERE TODAY.
YOU HAVE YOUR MARCHING ORDERS? CAN WE GET TOGETHER NEXT MONTH?
>> YES SIR. WE GOT A LOT OF WORK TO DO.
THANK YOU, COUNCIL MEMBERS, FOR THE GREAT QUESTIONS, COMMITTEE MEMBERS, AND ANYONE ELSE WHO WANTS TO JOIN US.
STICK AROUND FOR THE REST OF OUR DOCKET, PLEASE.
WE DO HAVE A BRIEFING THAT I'M GOING TO ASK MR. IRELAND TO, Y'ALL GOING TO DO THIS IN AN EXPEDITED FASHION, HOPEFULLY.
SAVE TIME FOR QUESTIONS ON ITEM B, WHICH IS THE EXISTING DEBT.
THIS IS ACTUALLY VERY ON TOPIC TODAY, AND THE FISCAL YEAR 26 PLAN DEBT. TAKE IT AWAY.
>> THANK YOU, CHAIR WEST. I'LL INTRODUCE THE TOPIC, IF I MAY, AND THEN TURN IT OVER TO MISS WEEDEN AND MISS KURZMANN FOR THE PRESENTATION.
EACH YEAR, WE ISSUE DEBT OF DIFFERENT TYPES.
WE WILL ISSUE GENERAL OBLIGATION DEBT, OR ISSUE DEBT FOR THE CONVENTION CENTER, OR FOR AVIATION, WATER UTILITY, ETC.
THIS BRIEFING GIVES AN OVERVIEW OF OUR DEBT, OUR DEBT PROFILE GIVES SOME BACKGROUND INFORMATION.
THEN WE'LL GO IN AND TALK ABOUT THE DEBT THAT WE'RE ISSUING IN THIS YEAR.
DUE TO TIME, IF WE CAN KIND OF SKIM THROUGH THE BEST WE CAN.
JANETTE, ARE YOU LEADING US ALL? > YES, SIR. THANK YOU.
MY NAME IS JANETTE WHEATON, DIRECTOR OF BUDGET AND MANAGEMENT SERVICES, AND WE ARE HERE TO DISCUSS EXISTING DEBT IN THE FISCAL YEAR 26 PLAN DEBT ISSUANCES.
WE HAVE IVAN GULL, ASSISTANT DIRECTOR OF BUDGET AND MANAGEMENT SERVICES, JENNY KURZMANN, WHO IS THE ASSISTANT DIRECTOR OF TREASURY, FELICIA HERNANDEZ, WHO IS OUR DEBT ADMINISTRATOR, AND STEVEN JOHNSON, OUR FINANCIAL ADVISOR FROM HILLTOP SECURITIES.
I WILL TRY TO GO THROUGH THIS VERY QUICKLY.
TODAY WE'RE HERE TO PROVIDE AN OVERVIEW OF OUTSTANDING DEBT.
WE'VE RECEIVED QUESTIONS ABOUT HOW MUCH DEBT DO WE HAVE OUTSTANDING COLLECTIVELY FOR THE CITY, SO THAT'S INCLUDED IN THIS PRESENTATION.
WE'LL ALSO TALK ABOUT OUR GENERAL OBLIGATION DEBT, OUR DEBT CAPACITY.
SOME OF THE THINGS THAT YOU ALL TALKED ABOUT EARLIER IN THE PREVIOUS BRIEFING, WE'LL TOUCH ON VERY BRIEFLY THEM, AND THEN TALK ABOUT OUR PLANNED DEBT IN THE NEXT STEPS.
THIS CHART IS A SUMMARY OF OUR OUTSTANDING DEBT AS OF SEPTEMBER 30.
[01:40:07]
THIS TABLE, I WANT TO ORIENT YOU TO HOW THE TABLE IS LAID OUT.IT INCLUDES OUR DEBT THAT'S REPAID BY PROPERTY TAXES, THAT'S LISTED AT THE TOP OF THE TABLE UNDER TAX-SUPPORTED DEBT.
THEN WE ALSO INCLUDE DEBT THAT'S REPAID BY REVENUE BONDS.
YOU'LL SEE AT THE BOTTOM PORTION OF THE TABLE, WE'VE ISSUED BONDS FOR CONVENTION CENTER, DALLAS WATER UTILITIES, DRAINAGE PROJECTS, DALLAS LUFFIELD, AND DOWNTOWN DALLAS DEVELOPMENT AUTHORITY.
THE REVENUE BONDS THAT ARE SUPPORTED IN THE BOTTOM PORTION OF THE TABLE THEY'RE SUPPORTED BY BUSINESS-TYPE ACTIVITIES.
THEY ARE SELF-SUSTAINING THROUGH OUR USER FEES.
THEY ARE NOT FUNDED BY PROPERTY TAX DOLLARS.
SINCE THESE ACTIVITIES GENERATE THEIR OWN REVENUE, THEY DO NOT CONTRIBUTE TO THE FINANCIAL BURDEN ON PROPERTY TAXPAYERS, AND THEY ARE NOT COUNTED AS TAX-SUPPORTED DEBT.
THE ONLY SOURCE OF REVENUE THAT THE BONDHOLDERS ARE ENTITLED TO ARE THAT OF THE PLEDGE REVENUES.
MOVING ON TO SLIDE NUMBER 5, OUR TAX-SUPPORTED DEBT IS LISTED HERE ON SLIDE 5.
NOW, THE OBLIGATIONS HERE ON THIS SLIDE THEY ARE A DIRECT OBLIGATION OF THE CITY.
THEY ARE PAYABLE AND SECURED BY PROPERTY TAXES, AND ALL TAXABLE PROPERTY WITHIN THE CITY PAY THIS DEBT, WITH 53% OF PROPERTY TAXES COMING FROM OUR COMMERCIAL PROPERTIES AND 47% COMING FROM OUR RESIDENTIAL PROPERTIES.
FOR THE NEXT FEW SLIDES, YOU'LL SEE THE ENTITY OR TYPE OF DEBT, AND THEN YOU WILL ALSO SEE THE CREDIT RATING TO THE RIGHT OF THE TOTAL OUTSTANDING BALANCE.
YOU'LL SEE ON THIS SLIDE THAT THE CURRENT CREDIT RATINGS FOR OUR GENERAL OBLIGATION DEBT ARE CONSIDERED HIGH QUALITY AND INVESTMENT GRADE.
MOVING ON TO SLIDE NUMBER 6, THIS TABLE REFLECTS OUR CONVENTION CENTER DEBT.
IT REFLECTS THE PLEDGE REVENUE IS SPECIAL OBLIGATIONS OF THE CITY.
AGAIN, THESE BONDS ARE NOT BACKED BY PROPERTY TAXES.
SPECIAL OBLIGATION MEANS THAT THE BONDS ARE PAYABLE FROM PLEDGE REVENUES.
FOR THE CONVENTION CENTER, THE PLEDGE REVENUES INCLUDE THE HOTEL OCCUPANCY TAX.
FOR THE CONVENTION CENTER HOTEL DEVELOPMENT CORPORATION, THE PLEDGE REVENUE IS REVENUE GENERATED FROM THE HOTEL PROJECT.
THE BOTTOM OF THE TABLE INCLUDES THE DEFINITION OF EACH PLEDGE FOR THE BONDS, AND THEN YOU'LL ALSO SEE THE CHART WITH THE CREDIT RATING.
FOR OUR CONVENTION CENTER CREDIT RATINGS BONDS ARE INVESTMENT GRADE.
MOVING ON TO SLIDE NUMBER 7, DALLAS WATER UTILITIES.
THEIR OUTSTANDING DEBT IS LISTED HERE ON SLIDE 7.
AGAIN, NOT BACKED BY PROPERTY TAXES, THESE BONDS ARE PAYABLE FROM PLEDGE REVENUES FROM UTILITY RATE PAYERS.
WHILE THE CITY ISSUES THE DEBT MANAGES THE UTILITY THAT GENERATES THE PLEDGE REVENUE, WE ENSURE THAT THE REVENUES ARE COLLECTED AND USED FOR REPAYMENT.
HOWEVER, THE CITY IS NOT LEGALLY OBLIGATED OR REQUIRED TO USE OTHER FUNDS TO MAKE THESE PAYMENTS.
THE DEFINITIONS OF THE OUTSTANDING PLEDGES ARE LISTED HERE AT THE BOTTOM OF THE TABLE, AND THE CREDIT RATINGS ARE LISTED ON THE SIDE.
FOR DALLAS WATER UTILITIES, THEY ARE INVESTMENT GRADE OR HIGH-QUALITY INVESTMENT GRADE.
ON SLIDE NUMBER 8, AVIATION OUTSTANDING DEBT IS DEBT OF THE LOVE FIELD AIRPORT MODERNIZATION CORPORATION.
THE LOVE FIELD AIRPORT MODERNIZATION CORPORATION WAS FORMED WITH THE AUTHORITY TO ISSUE BONDS TO MODERNIZE THE AIRPORT.
AGAIN, THESE BONDS ARE NOT BACKED BY PROPERTY TAXES.
THE AIRPORT BONDS ARE PAYABLE SOLELY FROM REVENUES OF THE AIRPORT SYSTEM, WHICH IS NET REVENUES AFTER DEDUCTING OUR CURRENT OPERATING EXPENSES.
THEN THE SPECIAL FACILITY BONDS, THOSE PAYMENTS ARE SECURED BY FACILITY PAYMENTS MADE BY SOUTHWEST AIRLINES PURSUANT TO OUR FACILITY AGREEMENT.
THE DEFINITION OF THE ENTITIES OR THE OUTSTANDING BONDS ARE LISTED AT THE BOTTOM OF THE TABLE, AND YOU WILL SEE THAT THE CREDIT RATINGS ARE INVESTMENT GREAT.
THEN THE LAST ENTITY ON SLIDE NUMBER 9 ARE THE DOWNTOWN DEVELOPMENT AUTHORITY.
THIS AUTHORITY WAS ESTABLISHED TO PROMOTE ECONOMIC DEVELOPMENT OF THE DOWNTOWN AREA AND IMPROVE THE TAX BASE.
AGAIN, THESE BONDS ARE NOT BACKED BY PROPERTY TAXES.
THE BOND IS PAYABLE SOLELY FROM THE TAX INCREMENT IN ACCORDANCE WITH THE TERMS OF THE ILA BETWEEN THE CITY AND DALLAS COUNTY.
MOVING ON TO SLIDE NUMBER 11, WE'LL TALK A LITTLE BIT MORE ABOUT OUR GENERAL OBLIGATION DEBT.
AS YOU KNOW, IT IS USED TO FINANCE OUR LONG-TERM INFRASTRUCTURE NEEDS.
WHEN WE ISSUE THESE BONDS, WE SPREAD THE COST OVER THE LIFE CYCLE OF THE ASSET.
[01:45:02]
FOR MOST OF OUR BOND-FUNDED PROJECTS, THAT'S 20 YEARS, THE USE OF GENERAL OBLIGATION DEBT IS GOVERNED BY STATE LAW, AND THERE ARE CERTAIN VOTER REQUIREMENTS ASSOCIATED WITH THIS DEBT.AGAIN, THIS DEBT IS REPAID BY PROPERTY TAXES, AND THE CITY IS REQUIRED TO LEVY A PROPERTY TAX RATE THAT'S SUFFICIENT TO PAY THE PRINCIPAL AND INTEREST PAYMENTS.
OF COURSE, YOU KNOW THAT THE CITY ISSUES GO BONDS FOR VARIOUS TYPES OF PROJECTS.
WE'VE TALKED ABOUT STREETS, FLOOD PROTECTION, ECONOMIC DEVELOPMENT, PARK AND RECREATION, AS WELL AS CITY FACILITIES.
THIS SLIDE ALSO LIST OUR PRIOR BOND PROGRAMS, AND YOU WILL SEE THAT THE CITY HAS HELD A NUMBER OF BOND PROGRAMS SINCE 1998, WITH THE MOST RECENT IN 2024 OF 1.25 BILLION.
THE LAST BULLET ON THIS SLIDE SPEAKS TO OUR COMMERCIAL PAPER PROGRAM.
WE DO HAVE A COMMERCIAL PAPER PROGRAM HERE FOR OUR GENERAL OBLIGATION DEBT, 350 MILLION, AND WE USE IT FOR INTERIM FINANCING.
MOVING ON TO OUR DEBT CAPACITY, AGAIN, OUR GO BONDS ARE REPAID BY PROPERTY TAX, AND WHILE WE HAVE RECENT PROPERTY TAX VALUE GROWTH THAT'S BEEN REALLY STRONG FOR THE LAST FEW YEARS, WE LOOK AT OUR CAPACITY TO ISSUE ADDITIONAL BONDS OVER A LONG-TERM PERIOD.
YOU'LL SEE THAT OUR FISCAL YEAR 26 GROWTH WAS ABOUT 5.3%.
HOWEVER, WHEN WE LOOK AT THE CAPACITY IN OUR BOND MODEL, WE LOOK AT THE AVERAGE OVER THE LAST 20, 30 YEARS AND SO WE'RE USING AN AVERAGE OF 4.4% IN OUR MODEL.
YOU CAN SEE ON SLIDE 15 THAT TAXABLE VALUE GROWTH OVER TIME, AND YOU CAN SEE THE YEAR-OVER-YEAR INCREASE AS WELL AS THE INCREASE SINCE 1986.
MOVING ON TO SLIDE 16, AS YOU KNOW, PROPERTY TAX REVENUE IS BASED ON THE VALUE THAT'S SET BY THE APPRAISAL DISTRICT, BUT IT'S ALSO A FORMULA USING THE TAX RATE THAT'S APPROVED BY THE CITY COUNCIL.
THE FISCAL YEAR 26 TAX RATE IS $69.88, AND THE DEBT SERVICE PORTION OF THAT TAX RATE IS $19.13.
THE FISCAL YEAR 26 BUDGET DECREASED THE TAX RATE BY $0.25.
HOWEVER, OUR FORECAST MODEL ASSUMES NO CHANGE IN THE TAX RATE.
WE HAVE BEEN ABLE TO GENERATE ADDITIONAL CAPACITY, LEAVING THE TAX RATE AT $19.13, BUT THEY'RE ALSO LOOKING AT OUR HISTORICAL GROWTH, AND I'LL TALK ABOUT THAT IN A FUTURE SLIDE.
SLIDE 17 REFLECTS THE HISTORICAL DISTRIBUTION BETWEEN THE GENERAL FUND TAX RATE AND THE DEBT SERVICE TAX RATE.
OVER THE LAST PROBABLY 10 YEARS, WE'VE MAINTAINED A SPLIT ANYWHERE BETWEEN 72-28% OR 73-27% BETWEEN THE GENERAL FUND PORTION OF THE TAX RATE AND THE DEBT SERVICE PORTION OF THE TAX RATE.
ON SLIDE NUMBER 18, YOU HAVE SEEN THIS CHART BEFORE IN THE PAST.
THIS IS THE HISTORICAL CHANGE IN THE TOTAL TAX RATE.
THIS SLIDE IS JUST SHOWING YOU HOW THE TAX RATE HAS CHANGED OVER THE LAST FEW YEARS, WITH OUR LAST 10-YEAR DECREASE IN THE TOTAL TAX RATE.
IN MAY OF 2024, THE VOTERS AUTHORIZED 1.25 BILLION FOR A GENERAL OBLIGATION BOND PROGRAM.
IN THE LATTER PORTION OF THIS PRESENTATION, WE'LL TALK ABOUT OUR PLANNED ISSUANCES.
THE SECOND TRANCHE OF THE 2024 BOND PROGRAM IS PLANNED TO BE ISSUED IN DECEMBER.
THIS CHART IS JUST SHOWING YOU THE AMOUNT THAT WAS AUTHORIZED BY THE VOTERS.
THE 250 MILLION WE ISSUED LAST YEAR, AND THEN THE UPCOMING 250 MILLION THAT'S PLANNED FOR DECEMBER.
THEN IT SHOWS YOU THE AUTHORIZED BUT UNISSUED AMOUNT IN THE LAST COLUMN.
MOVING ON TO THE NEXT SLIDE, WE HAVE MENTIONED IN PREVIOUS BRIEFINGS THAT WE MAINTAIN A VERY EXTENSIVE GO FUNDING MODEL.
IT IS AN INTERACTIVE MODEL THAT WE USE TO FORECAST OUR DEBT.
BASED ON OUR TAXABLE VALUE GROWTH ASSUMPTIONS, THE TAX RATE THAT I'VE TALKED ABOUT, PLANNED ISSUANCES, OUR EXISTING CAPACITY, THIS SLIDE IS SHOWING YOU WHAT WE HAVE PLANNED FROM FISCAL YEAR 26 THROUGH FISCAL YEAR 30.
YOU CAN SEE THE 2024 BOND PROGRAM, AND WHEN WE EXPECT TO ISSUE THOSE BONDS, YOU CAN ALSO SEE THE DEBT THAT WE ISSUE FOR MASTER LEASE AND EQUIPMENT NOTES.
THEN WE ALSO HAVE A PLACEHOLDER FOR POTENTIAL PENSION OBLIGATION BONDS,
[01:50:01]
DEPENDING ON THE MARKET CONDITIONS. ON SLIDE 21.THIS CHART AGAIN REFLECTS OUR ASSUMPTIONS IN OUR DEBT MODEL.
AS I MENTIONED, THE MODEL INCLUDES OUR CURRENT OUTSTANDING DEBT.
IT FORECASTS THE ASSUMPTIONS THAT WE USE TO SUPPORT THE 2024 BOND PROGRAM.
THERE'S THE RESERVE CAPACITY FOR PENSION OBLIGATION BONDS.
THEN THERE'S ALSO CAPACITY SET ASIDE FOR A FUTURE BOND PROGRAM.
THE GREEN LINE REPRESENTS THE REVENUE, AND SO YOU CAN SEE OVER TIME, WE ARE ABLE TO GENERATE ADDITIONAL CAPACITY AS WE PAY OFF EXISTING DEBT.
THEN MOVING ON TO OUR DEBT PROFILE.
OUR TOTAL GENERAL OBLIGATION DEBT OUTSTANDING FOR PRINCIPAL IS ABOUT 2.5 BILLION.
OUR ANNUAL DEBT SERVICE PAYMENT IS 434 MILLION.
AGAIN, OUR TAX RATE IS $19.13, AND OUR AVERAGE INTEREST RATE FOR OUR OUTSTANDING DEBT IS ABOUT 3.06%.
ON AVERAGE MATURITY IS SEVEN YEARS.
WE HAVE A PHILOSOPHY HERE AT THE CITY THAT WE PAY THE LEVEL PRINCIPLE, AND SO BECAUSE OF THAT, 76.7% OF OUR DEBT IS PROJECTED TO BE REPAID IN 10 YEARS.
>> MOVING ON TO SLIDE 24, THE CITY MAINTAINS AND FOLLOWS VERY STRICT FINANCIAL POLICIES.
WE ALWAYS WANT TO MAKE SURE THAT OUR DEBT REMAINS WITHIN REASONABLE LEVELS.
OUR DEBT IS CAREFULLY PLANNED, IT'S BUDGETED AND STRUCTURED IN A WAY THAT WE CAN SUSTAIN LONG TERM FINANCIAL STABILITY.
WE ALSO HAVE A COMMITMENT TO TRANSPARENCY.
WE PROVIDE FINANCIAL REPORTS ON OUR FINANCIAL TRANSPARENCY WEBSITE THAT INCLUDES OUR AUDITED FINANCIAL STATEMENTS, OUR BUDGET ACCOUNTABILITY REPORT.
WE ALSO INCLUDE OUR INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT REPORTS.
THEN, OF COURSE, WE MAINTAIN AN INVESTOR RELATIONS WEBSITE, WHICH IS CITY OF DALLAS BONDS.COM.
I MENTIONED THOSE STRONG FINANCIAL POLICIES.
WITHIN OUR FINANCIAL POLICIES, WE CALL THEM FINANCIAL MANAGEMENT PERFORMANCE CRITERIA.
WE HAVE 16 POLICIES ASSOCIATED WITH CAPITAL AND DEBT.
I'VE LISTED A FEW OF THEM HERE, AND WHAT THIS SLIDE IS SHOWING YOU IS THAT WE ARE IN COMPLIANCE AND IN MANY CASES, WE EXCEED OUR GOALS RELATED TO OUR FINANCIAL POLICIES.
WE DO HAVE A FEW SLIDES IN OUR PRESENTATION RELATED TO DEBT PER CAPITA.
IT IS OFTEN A MEASURE THAT WE ARE ASKED ABOUT.
IT'S USED FOR COMPARISON PURPOSES, BUT IT'S OFTEN FOR COMPARISON, BUT IT DOESN'T REALLY REFLECT THE TRUE FINANCIAL HEALTH OF THE CITY.
DEBT PER CAPITA IS THE TOTAL AMOUNT OF DEBT OWED DIVIDED BY THE POPULATION.
IT IS A SIMPLE SNAPSHOT POINT IN TIME.
WE PROVIDED IN OUR PRESENTATION, BUT WE WANT TO POINT OUT THAT THERE ARE SO MANY UNIQUE FACTORS OF A CITY, AND NOT ALL CITIES ARE THE SAME.
FOR US, THE VALUE OF PROPERTIES ARE UNIQUE FOR A CITY, THE AGE OF THE CITY.
IT DOESN'T REPRESENT TRENDS AND SO, FOR EXAMPLE, YOU'LL SEE ON THE NEXT FEW SLIDES, HOW WE TALK ABOUT THE FACT THAT THE CITY OF DALLAS HAS A COMMITMENT TO IMPLEMENT BOND PROGRAMS. THAT'S NOT ALWAYS CONSIDERED WHEN WE TALK ABOUT DEBT PER CAPITA.
MOVING ON TO SLIDE NUMBER 27, THIS CHART IS A REPRESENTATION OF HOW THE CITY OF DALLAS DEBT PER CAPITA IS IMPACTED BY DIFFERENT DECISIONS THAT ARE MADE HERE AT THE CITY OF DALLAS.
THIS CHART IS SHOWING YOU THAT THE FACTORS THAT IMPACT OUR DEBT PER CAPITA.
AS I MENTIONED, THE CITY HAS CONSISTENTLY PRESENTED BOND PROGRAMS TO THE VOTERS.
THOSE PROGRAMS HAVE BEEN APPROVED BY THE VOTERS, AND SO YOU CAN SEE THE IMPACT OF THE BOND PROGRAMS ON OUR DEBT PER CAPITA.
SLIDE 28 PROVIDES A COMPARISON TO OUR PEER CITIES.
AGAIN, THERE ARE SO MANY DIFFERENT FACTORS THAT INFLUENCE DEBT PER CAPITA, BUT THIS IS A CHART THAT'S OFTEN REQUESTED WHEN WE TALK ABOUT OUR OUTSTANDING DEBT.
THEN LASTLY, I WANT TO TALK ABOUT OUR CREDIT RATING.
OUR CREDIT RATING IS AN ASSESSMENT OF OUR ABILITY TO REPAY OUR FINANCIAL OBLIGATIONS, AND IT'S REALLY JUST A MEASURE OF OUR CREDIT WORTHINESS.
[01:55:04]
CREDIT RATING AGENCIES ASSIGN THESE RATINGS TO HELP INVESTORS EVALUATE OUR LEVEL OF RISK.ON THIS SLIDE, IT'S A LITTLE BUSY.
BUT WHAT WE ARE TRYING TO SHARE IS THE HISTORY OF OUR CREDIT RATING AND FACTORS THAT INFLUENCE OUR RATINGS.
YOU CAN SEE ON THIS SLIDE THAT THE BIGGEST FACTOR INFLUENCING OUR RATING IS PENSION.
IN 2015, THE GOVERNMENT ACCOUNTING STANDARDS BOARD, GASB ISSUED A STATEMENT, STATEMENT 68 THAT ESTABLISHED HOW STATE AND LOCAL GOVERNMENTS CALCULATE AND REPORT NET PENSION LIABILITY.
FROM THAT TIME, MOVING FORWARD, FOLLOWING THE GASB RULING, OUR PENSION POSITION HAS BEEN A MAJOR FACTOR THAT'S INFLUENCING OUR CREDIT RATING, YOU CAN SEE THAT HERE REPRESENTED ON SLIDE 29.
ON SLIDE NUMBER 30, THIS REFLECTS OUR CURRENT RATINGS.
POSITIVE FACTORS IMPACTING OUR CREDIT RATING INCLUDE OUR GROWING TAX BASE, OUR HEALTHY RESERVES, AND OUR PROVEN ABILITY TO BALANCE THE BUDGET.
AGAIN, THE NEGATIVE FACTOR IMPACTING OUR RATING IS PENSION.
NEXT, I'LL TURN IT OVER TO STEVEN JOHNSON, OUR CITY'S FINANCIAL ADVISOR FROM HILLTOP SECURITIES TO REALLY TALK ABOUT THE FINANCIAL STATUS OF THE CITY.
MOST OF YOU HAVE RECEIVED INFORMATION REGARDING RECENT ARTICLES AND REPORTS, AND SO WE REALLY WANT TO COMMENT ON SOME OF THAT FEEDBACK THAT YOU'VE SEEN.
>> THANK YOU, JEANETTE. STEVEN JOHNSON WITH HILLTOP SECURITIES, CO-FINANCIAL ADVISOR TO THE CITY.
THERE HAVE BEEN RECENT ARTICLES ABOUT THE DEBT LEVEL FOR THE CITY OF DALLAS, AND THE BIGGEST THING IMPACTING THAT, WHICH JEANETTE JUST POINTED OUT IN THE RATINGS WAS THE PENSION OBLIGATIONS, AND HOW THAT'S IMPACTING A LOT OF THE CITY'S DEBT MODELS.
SOME OF THE ARTICLES ALSO IMPLY THAT ALL OF THE DEBT OBLIGATIONS ARE DUE IMMEDIATELY, SO THAT REALLY INCREASES THE AMOUNT THAT IT LOOKS LIKE THE CITY ACTUALLY OWES.
WHEN ONE OF THE REASONS CITIES ISSUE DEBT IS TO PAY IT OVER TIME SO THAT SOME OF THE PEOPLE THAT BENEFIT FROM SOME OF THE CAPITAL IMPROVEMENTS, STREETS, SIDEWALKS, LIBRARIES, THINGS LIKE THAT.
GETS SPREAD OVER A GENERATIONAL WEALTH AS OPPOSED TO PUTTING IT ON JUST ALL OF THE TAXPAYERS FOR TODAY.
WE KNOW WE CAN'T AFFORD THAT ON A CURRENT BASIS.
SOME OF THESE ARTICLES HAVE REALLY PENALIZE THE CITY FOR DOING ITS JOB.
OTHER ARTICLES ALSO, LIKE I MENTIONED, ADD THE UNFUNDED PENSION LIABILITIES, WHICH A LITTLE OVER THE YEAR AGO, THE CITY FINALLY PASSED ITS PLAN TO FUND THAT PROGRAM.
IT'S GOING TO TAKE TIME. THE RATING AGENCY PROCESS FOR THE RECENT BOND ISSUE THAT WE'RE ABOUT TO ISSUE ALSO TOOK NOTE OF THAT, AND THEY KNOW THAT THE CITY IS GOING TO CONTINUE TO WORK ON FUNDING THAT PENSION PLAN, BUT IT'S NOT GOING TO OCCUR OVERNIGHT.
IT'S GOING TO OCCUR OVER 30 YEARS.
OTHER ARTICLES OR OTHER IMPACTS OF SOME OF THE ARTICLES IS THEY INCLUDE SOME OF THE DEBT THAT THE CITY DOESN'T HAVE TO PAY DIRECTLY.
IT'S ISSUED FOR SOME OF THE PROJECTS LIKE THE DOWNTOWN DEVELOPMENT AUTHORITY IN LOVE FIELD, WHERE THE SOURCES FOR THOSE REVENUE BONDS ARE ACTUALLY PAID FROM ISSUERS OTHER THAN THE CITY.
THERE'S ALSO ENTERPRISE FUNDS, DALLAS WATER UTILITIES IS A GREAT EXAMPLE.
PAID FROM WATER AND SEWER SOURCES, NOT FROM GENERAL OBLIGATION TAXES.
ADDITIONALLY, DALLAS WATER UTILITIES IS A REGIONAL WATER ISSUER.
IT PROVIDES CAPITAL PLANS AND WATER FOR A LOT OF THE CITIES AROUND THE REGION, AND ALL OF THAT DEBT GETS INCLUDED AS THE CITY'S DEBT PORTFOLIO, BUT IT'S ISSUING SOMEWHAT ON BEHALF OF WHOLESALE CUSTOMERS.
ON SLIDE 33, SOME OF THE METHODOLOGIES ARE LOOKING AT TRYING TO GET TO EACH TAXPAYER SHARE OF THE BURDEN.
WELL, WHO DO YOU PUT THAT ON? LIKE JEANETTE POINTED OUT, 53% OF YOUR TAX BASE IS COMMERCIAL VERSUS RESIDENTIAL.
ALSO GOING BACK TO THE WHOLESALE CUSTOMERS VERSUS THE CITY ITSELF, I THINK THE WHOLESALE CUSTOMERS ON A PUMP PAGE STANDPOINT, TAKE UP ABOUT 27% OF THE GALLONS USED BY THE DALLAS WATER UTILITIES.
AS FAR AS MEASURING HOW THE CITY PERFORMS, IT'S GOT A STRONG FMPC POLICY THAT FOLLOWS, YOU SAW IN THE PRIOR SLIDE THAT IT'S MEETING ALL OF THAT CRITERIA.
THAT POLICY IS EVALUATED EVERY FEW YEARS.
BUT THE CITY ALSO FOLLOWS GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, WHICH KEEPS EVERYONE ON PAR WITH WHEN THEY GO TO THE MARKET AND REPORTING INFORMATION THAT EVERYBODY IS LOOKING AT ALL
[02:00:03]
OF THIS INFORMATION ON A CONSISTENT BASIS BASED ON GAAP PRINCIPLES.WITH THAT, I'LL TURN IT BACK OVER TO JEANETTE TO TALK ABOUT UPCOMING PLAN DEBT.
I'M GOING TO TURN IT OVER TO MS. KURTZMAN.
>> GOOD AFTERNOON. JENNY KURTZMAN, ASSISTANT DIRECTOR OF TREASURY.
TRYING TO KEEP UP WITH PACE HERE, JEANETTE HAS PUT IN.
I'M GOING TO JUST REALLY QUICKLY THE BACKGROUND.
THE TREASURY DIVISION IS THE ONE THAT COORDINATES THE ISSUANCE OF THE BONDS.
WE WORK WITH ALL THE DIFFERENT DEPARTMENTS AND, OF COURSE, OUR FINANCIAL ADVISORS, BOND COUNCILS, AND THE STAKEHOLDERS.
WE'RE TAKING DIFFERENT FACTORS IN CONSIDERATION.
THE TIMING OF WHEN THE BONDS ARE ISSUED REALLY DEPENDS ON THE CAPITAL NEEDS, THE CURRENT MARKET CONDITIONS, AND ANY OTHER ITEMS THAT COULD AFFECT THE OUTCOME OF THE BONDS.
OF COURSE, FOLLOWING THE FINANCIAL MANAGEMENT PERFORMANCE CRITERIA.
DEFINITELY, WE'RE ALWAYS LOOKING FOR OPPORTUNITIES TO REFUND BONDS BUT AS LONG, WE HAVE TO MEET THE 3% ADOPTED MEASURES FROM THE FMPC.
RIGHT NOW, TENDERS ARE REALLY A GOOD OPTION FOR US TO LOOK INTO REFUNDING.
BUT AGAIN, IT JUST HAS TO MEET THAT REQUIREMENT.
I'M GOING TO PASS IT ON TO FELICIA HERNANDEZ, OUR DEBT ADMINISTRATOR.
SHE'S GOING TO COVER ALL OF THE UPCOMING SALES THAT WE HAVE PLANNED FOR THE FISCAL YEAR. THANK YOU.
>> HI. GOOD AFTERNOON. STARTING WITH THE GENERAL OBLIGATION DEBT ON SLIDE 37, PLEASE.
AS MENTIONED, THE CITY IS CURRENTLY PLANNING ON THE ISSUANCE OF GENERAL OBLIGATION BONDS SERIES 2025 IN AN AMOUNT NOT TO EXCEED 252 MILLION TO FUND THE SECOND 250 MILLION TRANCHE OF THE 2024 BOND PROGRAM COST.
THE CITY COUNCIL APPROVED THE PREPARATION OF THE BONDS ON SEPTEMBER 24TH, AND A RECOMMENDATION TO CITY COUNCIL FOR THE BOND ORDINANCE APPROVAL IS SCHEDULED ON OCTOBER 22ND.
PENDING APPROVAL OF THE ORDINANCE, THE BONDS WILL BE ISSUED VIA COMPETITIVE SALE.
THE ISSUANCE OF THESE BONDS ARE FOR NEW MONEY SOLELY TO FUND THE BOND PROGRAM PROJECTS, AS THERE ARE CURRENTLY NO ADVANTAGEOUS OPPORTUNITIES FOR REFUNDING FOR SAVINGS.
ON THE NEXT SLIDE, WE'VE INCLUDED A REITERATION OF THE TABLE ON SLIDE 19.
IT SHOWS THE AUTHORIZED BUT UNISSUED DEBT BY BOND PROPOSITION.
ON THE NEXT SLIDE, THE GENERAL OBLIGATION DEBT ALSO INCLUDES THE ISSUANCE OF EQUIPMENT NOTE SERIES 2025 AND AN AMOUNT NOT TO EXCEED 35 MILLION TO FUND BUDGETED APPROPRIATIONS FOR VEHICLE AND EQUIPMENT.
THE EQUIPMENT NOTE PROCEEDS FUND PURCHASES FOR VARIOUS CITY DEPARTMENTS LIKE DALLAS FIRE RESCUE, EQUIPMENT AND FLEET MANAGEMENT, SANITATION AND STORMWATER AND CONCURRENT WITH THE GO BONDS THAT ARE BEING ISSUED.
CITY COUNCIL ALSO APPROVED THE PREPARATION OF THE BONDS ON SEPTEMBER 24TH, AND A RECOMMENDATION TO CITY COUNCIL FOR THE BOND ORDINANCE APPROVAL IS SCHEDULED FOR OCTOBER 22ND.
AGAIN, PENDING ORDINANCE APPROVAL, THESE BONDS WILL BE ISSUED VIA COMPETITIVE SALE.
THE CITY BUDGET ALSO INCLUDES THE ISSUANCE OF 52.9 MILLION OF MASTER LEASE FUNDS FOR PUBLIC SAFETY, IT INFRASTRUCTURE, AND GENERAL CITY FLEET.
TREASURY STAFF IS ALSO WORKING ON THE PREPARATIONS TO ESTABLISH A REPLACEMENT GENERAL OBLIGATION COMMERCIAL PAPER PROGRAM IN ANTICIPATION OF THE CURRENT PROGRAM EXPIRING ON NOVEMBER 28TH.
THE CURRENT GO PROGRAM FOR COMMERCIAL PAPER IS SUPPORTED BY A $350 MILLION CREDIT AGREEMENT WITH JP MORGAN AND IS PENDING EXTENSION WHILE STAFF LOOKS AT THE CURRENT COMMERCIAL PAPER PROGRAM AND RE-EVALUATES IT TO ASSESS THE MOST ADVANTAGEOUS STRUCTURE AND ANY BENEFICIAL CHANGES THAT WE CAN BRING FORWARD.
OF COURSE, BEFORE SINKING CITY COUNCIL APPROVAL OF THE NEW PROGRAM, THE FINANCE COMMITTEE WILL BE BRIEFED ON THE NEW PROGRAM. NEXT SLIDE.
FOR DALLAS WATER UTILITIES, THE CITY IS CURRENTLY PLANNING ON THE ISSUANCE OF 34 MILLION IN WATERWORKS AND SEWER SYSTEM REVENUE SWIRFT BONDS TO THE WATER DEVELOPMENT BOARD.
THE WATER DEVELOPMENT BOARD PROVIDES LOW COST FINANCIAL ASSISTANCE VIA THE STATE WATER IMPLEMENTATION REVENUE FUND FOR TEXAS OR THE SWIRFT.
THIS IS THE FOURTH ISSUANCE OF A FIVE-YEAR SWIRFT FUNDING COMMITMENT WITH THE BOARD, AND IT IS REQUIRED PER THE FINANCING AGREEMENT WITH THE CITY.
CITY COUNCIL ALSO APPROVE THE PREPARATION OF THE BONDS VIA THE FINANCING AGREEMENT WITH THE BOARD ON AUGUST 27TH, AND RECOMMENDATION TO CITY COUNCIL FOR APPROVAL OF THE ORDINANCE AUTHORIZING THE SALE OF THE BONDS IS SCHEDULED AGAIN, FOR OCTOBER 22ND.
STAFF IS ALSO PLANNING FOR THE POTENTIAL ISSUANCE OF WATER REVENUE REFUNDING BONDS NEXT SPRING TO REFUND OUTSTANDING COMMERCIAL PAPER AND ELIGIBLE BONDS FOR SAVINGS.
CURRENTLY, THE ESTIMATES INDICATE A REFUNDING OF APPROXIMATELY 297.9 MILLION OF OUTSTANDING BONDS TO GENERATE APPROXIMATELY 13.4 MILLION OR 4.6% OF NET PRESENT VALUE SAVINGS.
CITY STAFF IS WORKING WITH OUR CITY FINANCIAL ADVISORS TO RECOMMEND A SELL STRATEGY BASED ON THE FORECASTED MARKET CONDITIONS.
[02:05:05]
ON THE NEXT SLIDE, DW PLAN DEBT ALSO INCLUDES THE POTENTIAL ISSUANCE OF DRAINAGE UTILITY SYSTEM OR STORMWATER BONDS TO FUND STORMWATER CAPITAL PLAN NEEDS OF APPROXIMATELY 48.9 MILLION IN FY 26.DALLAS WATER UTILITIES IS CURRENTLY FINALIZING THE FINANCING STRATEGY FOR STORMWATER ENTERPRISE FUND, WHICH WILL INCLUDE THE FUTURE ISSUANCE OF STORMWATER BONDS AND COMMERCIAL PAPER.
AGAIN, BEFORE SEEKING CITY COUNCIL APPROVAL, THE FINANCE COMMITTEE WILL BE PROVIDING INFORMATION ON THE STORMWATER DEBT PROGRAM AND STRUCTURE.
AN UPCOMING ITEM RELATED TO STORMWATER IS THE POTENTIAL ISSUANCE OF FIVE MILLION OF DRAINAGE UTILITY SYSTEM REVENUE BONDS TO THE WATER DEVELOPMENT BOARD, CONCURRENT WITH THE ACCEPTANCE OF A $5 MILLION GRANT VIA THE STATE FLOOD INFRASTRUCTURE FUND OR THE FIF.
THE FIF PROGRAM PROVIDES FINANCIAL ASSISTANCE IN THE FORM OF GRANTS AND LONG TERM FIXED RATE LOANS OFFERED AT 0% FOR FLOOD CONTROL FLOOD MITIGATION AND DRAINAGE PROJECTS.
THE CITY FIRST ISSUED DRAINAGE UTILITY SYSTEM REVENUE BONDS VIA THE FIF LAST YEAR.
ON SEPTEMBER 24TH, 2025, THE BOARD INVITED THE CITY OF DALLAS TO SUBMIT AN APPLICATION FOR FUNDING THROUGH THE FIF PROGRAM FOR THE MILL CREEK DRAINAGE RELIEF SYSTEM.
THE BOARD DOES REQUIRE CITY COUNCIL APPROVAL TO SUBMIT A FINAL APPLICATION TO THE BOARD FOR FIF FUNDING.
THEREFORE, A RECOMMENDATION FOR CITY COUNCIL APPROVAL OF A RESOLUTION AUTHORIZING THE APPLICATION TO THE BOARD IS SCHEDULED FOR CITY COUNCIL APPROVAL ON NOVEMBER 12TH.
>> PLANNED ISSUANCES RELATED TO THE CONVENTION CENTER IN FAIR PARK INCLUDE SPECIAL TAX REVENUE REFUNDING OBLIGATIONS TO FINANCE PROJECT COSTS AND REFUND THE SHORT-TERM INTERIM LOAN APPROVED BY CITY COUNCIL ON JUNE 11 FOR THE CONVENTION CENTER.
>> WE DON'T NEED TO READ THE SLIDES.
CAN YOU JUST SUMMARIZE THE NEXT COUPLE ONES FOR US?
>> SURE. WE HAVE TWO LEFT, I THINK.
FOR THE CONVENTION CENTER, THE PLANNED ISSUANCES FOR NEXT YEAR IN FY 26 INCLUDE SENIOR AND SUBORDINATE LIEN BONDS AND AN ESTIMATED PRINCIPAL AMOUNT NOT TO EXCEED $1.5 BILLION, WHICH INCLUDES THE REFUNDING OF THE SHORT TERM LOAN.
ALSO FOR FAIR PARK VENUE PROJECT BONDS, AGAIN, SENIOR AND SUBORDINATE LIEN BONDS, AN AMOUNT NOT TO EXCEED $72 MILLION, BOTH OF WHICH ARE SUBJECT TO CHANGE PENDING FINAL PROJECT COST.
THOSE BONDS WILL BE ISSUED VIA A NEGOTIATED CELL WITH AN UNDERWRITING SYNDICATE THAT WAS PREVIOUSLY APPROVED BY COUNCIL.
THOSE FINANCING STRUCTURES AND PLANS ARE STILL BEING FINALIZED WITH STAFF.
ALSO, FOR AIRPORT, REALLY QUICKLY, PLAN DEBT INCLUDES THE ISSUANCE OF GENERAL AIRPORT REFUNDING BONDS TO FINANCE CAPITAL IMPROVEMENTS AND REFUND OUTSTANDING COMMERCIAL PAPER.
OTHER FINANCING OPTIONS FOR THE AIRPORT INCLUDE FEDERAL LOANS AND GRANTS AND BONDS TO FINALIZE THE MASTER PLAN CAPITAL NEEDS, WHICH AGAIN, ARE BEING EVALUATED BY AIRPORT STAFF.
WE'RE ALSO WORKING ON ESTABLISHING REPLACEMENT COMMERCIAL PAPER PROGRAM FOR THE AIRPORT AS WELL.
THE LAST SLIDE IS SIMPLY REITERATING THE RECOMMENDATIONS AND NEXT STEPS, WHICH IS APPROVAL OF ALL OF THE ORDINANCES ON THE OCTOBER 22ND, COUNCIL AGENDA.
>> THANK YOU AND THIS CONCLUDES OUR PREPARED REMARKS.
WE HAVE INCLUDED THE TIMELINE OF THE PLAN ISSUANCES AS WELL AS THE TOTAL ISSUANCE COSTS IN THE APPENDIX, BUT WE ARE READY TO ANSWER QUESTIONS YOU MAY HAVE. THANK YOU.
>> DEPUTY MAYOR PRO TEM, TAKE IT AWAY.
>> I WANTED TO GO BACK, MR. JOHNSON TO THE TEAM ABOUT THE PENSION FUND AND HOW THAT'S BEING VIEWED IN THE MARKETPLACE, BECAUSE I KNOW ON NOVEMBER 15TH OF LAST YEAR, CITY MANAGER TOLBERT HAD SENT A MEMO ABOUT MOODY'S CHANGING THE GENERAL OBLIGATION OUTLOOK FOR THE CITY FROM STABLE TO NEGATIVE.
IT WAS DUE TO PENSION, BUT IT WAS ALSO BECAUSE OF THE PROPOSITION.
IT SAID THE REPORT NOTES THAT, "THE NEGATIVE OUTLOOK REFLECTS THE EXPECTED CREDIT IMPACT OF PROPOSITION U.
FURTHER, GOING FORWARD, THE CITY WILL FACE BUDGET CHALLENGES GIVEN REQUIRED INCREASES TO ITS PENSION PLANS, WHICH MAY BE BECAUSE OF THE FUNDING SOUNDNESS RESTORATION PLAN, WHICH WE KNOW AND EXPECT." BUT IT ALSO TALKS ABOUT GROWING PUBLIC SAFETY EXPENSES AND REDUCED FINANCIAL FLEXIBILITY FOLLOWING VOTER APPROVAL OF PROPOSITION U.
HERE WE ARE ALMOST A YEAR HENCE, AND I'M JUST WONDERING, WILL WE EVER CRAWL OUT FROM UNDER THIS OR IS THIS JUST GOING TO HANG OVER OUR HEAD AS LONG AS THAT'S ACTIVE?
>> JACK IRELAND CHIEF FINANCIAL OFFICER, AND I'LL START AND THEN, STEVE, I'LL ASK YOU TO HELP ME WITH THIS.
ON SLIDE 29 OF THE PRESENTATION,
[02:10:02]
JEANETTE LAID OUT A REALLY BUSY, BUT THOROUGH CHART THAT SHOWS OUR BOND RATING SINCE 2015-2025.IN EACH OF THE TEXT BOXES, YOU'LL SEE THE THINGS THAT HAPPENED THAT EITHER CAUSED A DOWNGRADE OR A CHANGE TO THE OUTLOOK, EITHER POSITIVE OR NEGATIVE.
WHAT WE'VE HEARD OVER THE LAST SEVERAL YEARS IS THAT THE PENSION FUND, THE UNFUNDED LIABILITY IS HAVING A NEGATIVE IMPACT ON OUR BOND RATING.
WILL WE EVER COME OUT FROM UNDER THAT? OF COURSE.
AS WE BEGIN TO IMPLEMENT THOSE FUNDING SOUNDNESS RESTORATION PLANS, ONCE THOSE SHOW UP IN OUR ANNUAL FINANCIAL REPORTS AND THE UNFUNDED LIABILITY BEGINS TO DECREASE, THERE WILL BE OPPORTUNITIES FOR THOSE TO CHANGE.
THE RATING AGENCIES ARE VERY THOUGHTFUL BEFORE THEY MAKE CHANGES, AND THEY WILL NOT DO IT QUICKLY.
IT WILL PROBABLY TAKE SEVERAL YEARS BEFORE WE SEE SOME OF THAT CHANGING.
BUT, YES, I ANTICIPATE AS WE PAY DOWN THOSE UNFUNDED LIABILITIES THAT WE SHOULD SEE CHANGE, NOT QUICKLY, BUT I WOULD ANTICIPATE THAT WE DO.
STEVE, DO YOU HAVE ANYTHING TO ADD TO THAT?
>> YEAH. ADD A LITTLE MORE COLOR.
OUT OF THE FOUR RATING AGENCIES, MOODY'S IS PROBABLY THE ONE THAT PENALIZES ISSUERS THE MOST ON PENSIONS.
THEIR VIEW OF WHAT THE CITY DID WITH PROPOSITION U IS THAT IT COULD ADD SOME ADDITIONAL COSTS IN LONG DISCUSSIONS WITH MOODY'S, WE DON'T AGREE WITH MOODY'S POSITION ON IT.
WE FEEL THAT THE CITY IS MAKING THE CONTRIBUTIONS AND THAT THE WAY MOODY'S IS LOOKING AT IT IS THOUGH THE CITY HAS TO TAKE HALF OF ALL OF ITS EXCESS REVENUES AND CONTRIBUTE, WHEN THAT'S NOT NECESSARILY THE CASE.
FROM OUR UNDERSTANDING, IT'S A MUCH LESSER AMOUNT, WHICH I UNDERSTAND.
JACK'S ALREADY BUDGETED IN THERE.
WE THINK MOODY'S IS OVERLY PENALIZING THE CITY IN THE RECENT, WE DON'T AGREE WITH THEIR NEGATIVE OUTLOOK, WHICH IS ONE OF THE REASONS WHY THE CITY DOESN'T USE MOODY'S ON ITS NEW ISSUANCES.
WHEN THE CITY ISSUES BONDS NOW, IT USES S&P AND FITCH, WHO BOTH ARE AWARE OF THE PENSION ISSUES WITH THE CITY, AND IN THEIR RECENT RATINGS REPORT, WHICH JUST CAME OUT LATE LAST WEEK FOR THE UPCOMING BOND SALE, THEY NOTED THAT IN ORDER FOR THE CITY TO GET A UPGRADE, SO TO SPEAK, THAT THERE WOULD NEED TO BE A MATERIAL CHANGE IN THE PENSION PLAN.
BUT BOTH OF THEM ALSO RECOGNIZED THAT THE CITY JUST IMPLEMENTED THE PLAN LAST YEAR, AND IT'S GOING TO TAKE TIME TO SEE A MATERIAL CHANGE.
THE RATING AGENCIES DON'T COME OUT AND TELL YOU WHAT THAT MATERIAL LEVEL IS.
BUT AT SOME POINT, NOW THAT THE CITY HAS A PLAN TO ADDRESS THIS PROBLEM, WE THINK THAT THAT'LL GET.
>> THERE'S A PLAN TO ADDRESS IT, AND I KNOW THAT IT WILL BE PAID DOWN, AND SO THAT IS HELPFUL.
HOWEVER, PART OF THE MANDATE IS A CERTAIN NUMBER OF OFFICERS, WHICH WE KNOW THE EXPENSE OF TRAINING AND OUTFITTING, ET CETERA.
AS I LOOK AT THE REST OF THIS, I MEAN, IT'S GREAT THAT WE CAN PAY DOWN PART OF IT, BUT THAT ADDRESSES ABOUT A THIRD OF THIS BECAUSE THE OTHER PART IS GROWING PUBLIC SAFETY EXPENSES AND REDUCED FINANCIAL FLEXIBILITY FOLLOWING VOTER APPROVAL OF PROPOSITION U.
THAT REDUCED FINANCIAL FLEXIBILITY WILL BE THERE AS LONG AS THAT'S IN THE CHARTER.
>> WE SPENT A LOT OF TIME OVER THE LAST YEAR EXPLAINING TO THE RATING AGENCIES WHAT PROPOSITION U SAYS AND WHAT IT DOESN'T SAY.
AS WE'VE TALKED ABOUT BEFORE, AND AS I SENT OUT A PRETTY THOROUGH MEMO ABOUT PROPOSITION U, THERE IS A LOT OF MISUNDERSTANDING ABOUT THE PROPOSITION BECAUSE WE SATISFY THE REQUIREMENTS OF THE PROPOSITION THROUGH OUR PENSION CONTRIBUTIONS.
THE OTHER COMPONENTS, WHILE THERE ARE THINGS THAT WE UNDERSTAND AND THAT WE AS A CITY WANT TO DO, INCREASING OUR HIRING, INCREASING OUR PAY, I DO NOT BELIEVE THOSE TAKE AWAY OUR BUDGET FLEXIBILITY, AND I'VE EXPRESSED THOSE TO THE RATING AGENCIES.
SOME LISTENED A LITTLE MORE THAN OTHERS, BUT WE HAVE DONE THE BEST WE COULD TO TRY TO EXPLAIN THE TRUTH ABOUT THE PROPOSITION TO THE RATING AGENCIES.
>> I UNDERSTAND, BUT THE LANGUAGE IS THE LANGUAGE AND IT DICTATES WHERE WE SEND MONEY.
WE LOSE THE AGILITY ON THAT, AND THAT'S JUST, I'M STILL CONCERNED OVER THAT, EVEN IF THAT'S AGENCY IS TENDS TO BE MORE NEGATIVE.
THE OTHER QUESTION I HAD WAS AROUND SLIDE 17 AND A REFERENCE ON SLIDE 24 ABOUT "CITY FOLLOWS STRICT FINANCIAL POLICIES TO ENSURE DEBT REMAINS WITHIN RESPONSIBLE LEVELS." THEN ON THE CHART THAT WE HAVE ON OUR PROPERTY TAX RATE, IT TALKS ABOUT OUR RATIO BETWEEN OUR DEBT AND THE GENERAL FUND.
I'M JUST WONDERING WHAT IS A GOOD GUIDE?
[02:15:02]
WHO DO WE TURN TO TO LOOK AT WHAT IS A GOOD PROPORTION FOR THAT? BECAUSE I SEE OUR COMPARISON TO OTHER CITIES, AND I DON'T EVEN NECESSARILY KNOW WHETHER THEY'RE DOING WELL OR IF WE COMPARE TO THE RIGHT PEOPLE OR NOT.BUT WHAT ARE THE GUIDES THAT WE GO BY?
>> THANK YOU FOR THAT QUESTION.
THE CHART ON SLIDE 17 IS JUST MORE OF A REFERENCE POINT.
IT'S JUST TELLING YOU THAT THE SPLIT BETWEEN THE GENERAL FUND AND THE DEBT SERVICE FUND IS X Y Z.
THE FINANCIAL POLICIES ARE REALLY YOUR GUIDE.
WE WORK VERY CLOSELY WITH OUR FINANCIAL ADVISORS TO REVIEW F&PC EVERY YEAR TO DETERMINE IF WE ARE WITHIN BEST PRACTICES.
THE FINANCIAL POLICIES, THE F&PC, THOSE ARE YOUR GUIDES.
THEY REALLY DICTATE IF WE'RE MAKING GOOD MANAGEMENT DECISIONS REGARDING DEBT.
>> THE F&PC WE ARE FUELING THAT WITH PROFESSIONAL ADVICE, INDUSTRY STANDARDS.
IT'S ONE THING, IF WE'VE GOT THAT GUIDE, THAT'S GREAT, BUT I WANT TO BE SURE THAT OUR GUIDE IS STILL WHERE WE SHOULD BE, AND THAT HOW OFTEN ARE WE GETTING THAT KIND OF CONSULTATION? IS THAT ANNUAL?
>> ANYBODY ELSE? NO. WE'LL MOVE ON.
COLLEAGUES, WE'RE NOT GOING TO BRIEF THESE ITEMS. THESE ARE JUST MEMOS IN CASE YOU HAVE QUESTIONS.
FIRST ONE IS ITEM C. WE'LL JUST GO THROUGH THEM.
THAT IS OUR MONTHLY BUDGET ACCOUNTABILITY REPORT.
I JUST GENERALLY WANT TO ASK STAFF, ARE ANY UPDATES ON THE SALES TAX REVENUES? I KNOW WE'VE BEEN DOWN.
I'D LIKE TO JUST HEAR MONTHLY FROM YOU IF IT'S LOOKING BETTER GENERALLY.
>> I THINK THE YEAR END FORECAST THAT WE HAVE LISTED HERE IN THE AUGUST REPORT IS PROBABLY A GOOD REFLECTION OF OUR END OF YEAR STATUS.
I THINK THE LATTER PART OF THE YEAR WAS A STRUGGLE FOR US, AND THAT WAS ONLY BECAUSE OF THE UNCERTAINTY ASSOCIATED WITH THE JOB MARKET AND TARIFFS.
WE ARE ANTICIPATING THAT THINGS WILL AND I'M PUTTING UP AIR NORMALIZE FOR FISCAL YEAR 26.
>> THEN THIS IS A QUESTION ON ENTERPRISE FUNDS.
I HAD A CALL YESTERDAY WITH SOME D13 PEOPLE ON THE ALLEY TO TRASH PICK UP, ACTUALLY.
THEY WERE MENTIONING HOW THERE'S EXCESS REVENUES IN THE SANITATION SERVICES ACCOUNT, WHICH IS ENTERPRISE FUNDS.
IT DOES APPEAR THAT'S CORRECT.
WITH MORE REVENUES AND EXPENDITURES.
HOW DOES THAT EVEN OUT? DOES THAT END UP BEING A REFUND TO USERS AT THE END OF THE YEAR? WE CAN'T MAKE A PROFIT IN ENTERPRISE.
>> IN THIS PARTICULAR EXAMPLE, SANITATION REVENUE IT'S A COMBINATION OF THE COLLECTIONS FOR TRASH AND RECYCLING, BUT IT ALSO INCLUDES OUR LANDFILL OPERATIONS.
FOR THE LANDFILL REVENUE IS ACTUALLY DRIVING THE OVERAGE THAT YOU SEE IN REVENUE.
IT'S DUE TO HIGHER THAN PROJECTED DISPOSALS FROM PRIVATE HAULERS AND SELF DISPOSAL BY DALLAS RESIDENTS.
IT'S A DIRECT REFLECTION OF THE LANDFILL, AND YES, THEY CAN MAKE A PROFIT BECAUSE IF THERE'S AN INCREASE IN THE NUMBER OF PEOPLE COMING TO THE LANDFILL, THOSE INDIVIDUALS PAY TO USE THE LANDFILL, AND SO THERE'S EXCESS REVENUE ASSOCIATED WITH IT.
>> BUT I CAN TELL PEOPLE WHO ARE ASKING THE QUESTION, IS THE CITY MAKING MONEY OFF MY TRASH PICK UP AT MY HOUSE?
>> NO. IT'S FROM THE LANDFILL.
THERE IS NO REBATE TO OUR TRASH COLLECTIONS.
>> WE SHOULD THINK ABOUT SANITATION IN TWO WAYS, THE COLLECTION, WHICH IS COST RECOVERY AND THE LANDFILL WHICH CAN CHARGE MARKET RATES, BECAUSE CUSTOMERS OF THE LANDFILL HAVE THE OPPORTUNITY TO GO TO FERRIS OR TO ARLINGTON OR SOMEWHERE ELSE? WE DO NOT HAVE TO CHARGE JUST COST RECOVERY FOR THE LANDFILL.
WE DO FOR THE RESIDENTIAL COLLECTION BECAUSE CUSTOMERS DON'T HAVE THE CHOICE.
>> GOT IT. THANK YOU. ANYBODY ELSE ON THIS ONE? DEPUTY MAYOR.
>> SURE. STAYING WITH THAT, YOU ALSO MENTIONED RECYCLING.
IS THAT THE REVENUE WE GET FROM I GUESS, FROM THE FIRM THAT WE WORK WITH ON THIS?
>> NO, I JUST USE THAT AS AN EXAMPLE, BUT THE EXCESS REVENUE IS NOT ASSOCIATED WITH RECYCLING OR TRASH PICKUP.
>> LANDFILL. THAT'S A GREAT POINT, MR. IRELAND, ABOUT HOW WE CAN CHARGE MORE TO OTHERS.
I HAD ANOTHER QUESTION ON NUMBER 4 PLANNING AND DEVELOPMENT ON PAGE 11.
[02:20:01]
I DON'T KNOW THAT THIS WOULD HAVE CARRIED FORWARD, BUT AS I LOOK AT THESE FIGURES, WAS THAT FEE MISCALCULATION FROM LAST YEAR? IS THAT WHAT WE'RE SEEING HERE?>> THAT IS EXACTLY WHAT YOU'RE SEEING FOR FISCAL YEAR 25.
THAT 11.6 MILLION THAT THEY'RE UNDER.
THAT'S A REFLECTION OF THE CALCULATION.
>> WE DON'T KNOW HOW WE'RE MAKING THAT UP.
>> AS THE DEPARTMENT IDENTIFIED THAT THE MISTAKE WITH THE REVENUE, AND WE CAME TO COUNSEL ABOUT THAT, THE DEPARTMENT STARTED REDUCING EXPENSES.
THEY DEFERRED PURCHASES THAT THEY HAD PLANNED AND SOME OTHER THINGS TO REDUCE THEIR SPENDING.
THEY DID HAVE SUFFICIENT FUND BALANCE TO BALANCE THE YEAR.
BUT WE HAVE CORRECTED THE REVENUE IN THE NEW YEAR SO THAT OUR REVENUES AND EXPENSES ARE MORE IN ALIGN.
THIS WAS A PROBLEMATIC YEAR FOR THAT DEPARTMENT.
>> WE STILL HAVE THIS $9 MILLION.
THAT WASN'T THAT AROUND WHAT IT WAS, 8 MILLION SOMETHING.
>> IT SHOWS ON SLIDE 11 UNDER PLANNING AND DEVELOPMENT, ANTICIPATING A ENDING YEAR FUND BALANCE OF 7.6 [OVERLAPPING]
>> WE HAD THOUGHT WE WOULD END THE YEAR WITH 9.3, WHICH IS HOW WE BUDGETED.
THEY DID HAVE TO SPEND SOME OF THAT DOWN, AND WE ANTICIPATE 7.6.
>> I'M STILL CONCERNED THAT IN THIS PARTICULAR DEPARTMENT THAT IT HANDLES PERMITTING AND THAT THING IS THAT WE'RE NOT HIRING BECAUSE THAT JUST SEEMS HARMFUL WHEN WE COULD BE FUELING MORE THAT CAN HELP US GENERATE MORE PROPERTY TAX AND THAT THING.
I KNOW THAT IS NOT THIS TEAM'S DECISION TO WORK OUT, BUT WE MAY NEED TO TALK TO THAT TEAM ABOUT WHAT WILL MAKE THEIR DEPARTMENT GO.
>> I DO BELIEVE IN THE 26 BUDGET THAT THEY HAVE TRUED UP THE STAFFING LEVEL TO MEET WHAT THEY ANTICIPATE THE NEEDS ARE FOR THE YEAR.
I DON'T ANTICIPATE A PROBLEM, BUT WE WILL, OF COURSE, REPORT TO THE COMMITTEE MONTHLY ON 26 AS WE GO FORWARD.
>> THANK YOU. ANYBODY ELSE ON ITEM C.
D, E, F? JUST IN CASE IF ANYBODY HAS QUESTIONS.
THE LAST ITEM IS ITEM H, AND I DID GET AN INDICATION FROM MR. IRELAND THAT ON THIS ONE, A COLLEAGUE WHO IS NOT HERE KICKED THIS ONE BACK FROM COUNSEL TO DISCUSS IN COMMITTEE.
BUT SINCE THAT COLLEAGUE IS NOT HERE, I DON'T HAVE ANY QUESTIONS ABOUT ITEM H. THIS WAS PART OF A GROUP OF ITEMS THAT I GUESS WE'RE ALL KICKED BACK TO VARIOUS COMMITTEES, AND THIS ONE WAS COLLATERAL DAMAGE.
IF NO ONE HAS ANY QUESTIONS ABOUT H, I WOULD LIKE TO JUST LET IT GO BACK FORWARD TO COUNSEL. IS THAT GOOD ENOUGH?
>> ANYBODY GOOD WITH THAT? [LAUGHTER] IT IS 3:26 PM, AND THIS MEETING IS ADJOURNED.
* This transcript was compiled from uncorrected Closed Captioning.