4. ORDINANCE NO. CS-413 – ORDINANCE PROHIBITING THE UNLAWFUL POSSESSION OF CATALYTIC CONVERTERS IN THE CITY OF CARLSBAD

[8. ECONOMIC AND FINANCIAL UPDATE FOR THE SECOND QUARTER OF FISCAL YEAR 2021-22 AND MID-YEAR REVIEW WITH STAFFING AND OTHER FUNDING REQUESTS (Part 1 of 2)]

2021-22 AND MID-YEAR REVIEW WITH THE STAFFING AND OTHER FUNDING REQUESTS.

MR. CHADWICK INTRODUCTIONS.

ALL RIGHT. THANK YOU SO MUCH, SIR.

AND INITIALLY KICKING OFF THE PRESENTATION IS GOING TO BE OUR DEPUTY CITY MANAGER, LAURA ROCHA, AND THEN SHE WILL ALSO INTRODUCE HER STAFF.

LAURA? GREAT. THANK YOU.

CITY MANAGER CHADWICK.

GOOD AFTERNOON, MAYOR AND MAYOR, PRO TEM AND CITY COUNCIL MEMBERS, I AM HAPPY TO BE HERE THIS AFTERNOON WITH STAFF MEMBERS.

MATT SANFORD, OUR ECONOMIC DEVELOPMENT MANAGER.

ROXANNE MUHLMEISTER, OUR ASSISTANT FINANCE DIRECTOR AND BRIGID JEWELRY, THE CITY'S BUDGET MANAGER, WHO WILL BE PRESENTING AN ECONOMIC AND FINANCIAL UPDATE FOR THE SECOND QUARTER OF FISCAL YEAR 21-22, ALONG WITH A MIDYEAR REVIEW WITH STAFFING AND OTHER FUNDING REQUESTS. SO WITH THAT, I'D LIKE TO GO AHEAD AND HAND THE PRESENTATION OVER TO MATT SANFORD, WHO WILL COVER THE ECONOMIC UPDATE.

THANK YOU. THANK YOU, LAURA.

AND IF WE COULD ADVANCE THE SLIDES, I THINK BY TWO, ONE MORE.

THANK YOU. GOOD AFTERNOON, MAYOR AND COUNCIL MEMBERS.

THIS ECONOMIC SCAN COVERS THE MONTHS OF OCTOBER THROUGH DECEMBER OF 2021.

IT PROVIDES CONTEXT AT A GLOBAL, REGIONAL AND LOCAL LEVEL.

NATIONALLY AND GLOBALLY, IN THE LAST QUARTER, THE OMICRON VARIANT HAD WIDESPREAD IMPACTS ON BUSINESSES AND WORKFORCES.

HOWEVER, AREAS LIKE SAN DIEGO, WHERE 80 PERCENT OF THE ELIGIBLE POPULATION HAD BEEN FULLY VACCINATED, HAVE FARED BETTER.

UNFORTUNATELY, DUE TO THE COMPARATIVELY MILDER NATURE OF THE OMICRON VARIANT, THE IMPACT ON GLOBAL MANUFACTURING WAS NOT AS SIGNIFICANT AS THE DELTA SURGE DURING THE FALL.

IN FACT, IF YOU LOOK AT THE RED CIRCLE ON THIS CHART, EXCUSE ME, I LOST MY PLACE, IN FACT, IN DECEMBER SAW A GROWTH OF FACTORY OUTPUT ACCELERATE TO THE FASTEST SINCE JULY, BROADLY MATCHING THE EXPANSION OF NEW ORDERS FOR THE FIRST TIME SINCE FEBRUARY.

AND THAT'S WHERE THE GRAY LINE AND THE GREEN LINE ONCE AGAIN CONVERGE.

THAT SAID, THE SNARLED GLOBAL SUPPLY CHAIN THAT WAS DISRUPTED IN THE FALL IS STILL AFFECTING IMPORTED GOODS FROM REACHING THEIR FINAL DESTINATION.

AT THE END OF DECEMBER, THERE WERE STILL MORE THAN ONE HUNDRED CONTAINER SHIPS WAITING TO UNLOAD CARGO IN LOS ANGELES AND LONG BEACH PORTS, IN PART BECAUSE OF THESE DISRUPTIONS.

THE CONSUMER PRICE INDEX, WHICH IS HOW MUCH A CONSUMER PAYS FOR COMMON GOODS, HAS SHOWN SIGNIFICANT INCREASES IN ALL CATEGORIES, INCLUDING ENERGY, FOOD AND HOUSING.

NATIONALLY, REAL GDP INCREASED AT AN ANNUAL RATE OF 6.9 PERCENT IN THE FOURTH OR EXCUSE ME, IN THE THIRD QUARTER OF 2021.

FOURTH QUARTER OF 2021 FOLLOWING AN INCREASE OF 2.3 PERCENT IN THE THIRD QUARTER.

THE ACCELERATION IN THE FOURTH QUARTER WAS LED BY AN UPTURN IN EXPORTS, AS WELL AS ACCELERATIONS IN INVENTORY, INVESTMENT AND CONSUMER SPENDING.

REAL GDP INCREASED IN 37 STATES AND THE DISTRICT OF COLUMBIA AND THE THIRD QUARTER OF 2021, THE LATEST QUARTER AVAILABLE FOR THIS DATA AS REAL GDP FOR THE NATION INCREASED AT AN ANNUAL RATE OF TWO POINT THREE PERCENT.

THE PERCENT CHANGE IN REAL GDP IN THE THIRD QUARTER RANGE FROM SIX PERCENT IN HAWAII TO -3.3 PERCENT IN NEW HAMPSHIRE AND NORTH DAKOTA.

GDP ESTIMATES REFLECT THE CONTINUED ECONOMIC IMPACTS RELATED TO THE COVID 19 PANDEMIC.

[01:00:05]

THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS INCREASED BY 0.5 PERCENT IN DECEMBER ON A SEASONALLY ADJUSTED BASIS AFTER RISING 0.8 PERCENT IN NOVEMBER.

OVER THE LAST 12 MONTHS, THE ALL ITEMS INDEX INCREASED SEVEN PERCENT BEFORE SEASONAL ADJUSTMENT INCREASES IN THE INDEXES FOR SHELTER AND FOR USED CARS AND TRUCKS WERE THE LARGEST CONTRIBUTORS TO THE SEASONALLY ADJUSTED, ALL ITEMS INCREASE.

THE FOOD INDEX ALSO CONTRIBUTED, ALTHOUGH IT INCREASED LESS LESS THAN IN RECENT MONTHS, RISING 0.5 PERCENT IN DECEMBER.

THE ENERGY INDEX DECLINED IN DECEMBER, ENDING A LONG SERIES OF INCREASES.

IT FELL 0.4 PERCENT AS THE INDEXES FOR GASOLINE AND NATURAL GAS BOTH DECREASED.

THE INDEX FOR ALL ITEMS, LESS FOOD AND ENERGY ROSE 0.6 PERCENT IN DECEMBER, FOLLOWING A 0.5 PERCENT INCREASE IN NOVEMBER.

THIS WAS THE SIXTH TIME IN THE LAST NINE MONTHS IT HAS INCREASED AT LEAST 0.5 PERCENT.

THE ALL ITEMS INDEX ROSE AGAIN SEVEN PERCENT FOR THE 12 MONTH PERIOD ENDING IN DECEMBER.

THIS WAS THE LARGEST 12 MONTH INCREASE SINCE THE PERIOD ENDING JUNE 1982.

THE ALL ITEMS LESS FOOD AND ENERGY INDEX ROSE FIVE POINT FIVE PERCENT, WHICH IS THE LARGEST 12 MONTH CHANGE SINCE THE PERIOD ENDING FEBRUARY OF 1991.

THE ENERGY INDEX ROSE 29.3 PERCENT OVER THE LAST YEAR, AND THE FOOD INDEX INCREASED SIX POINT THREE PERCENT. WELL, LOOKING A LITTLE BIT CLOSER, THE CURRENT SURGE FUELED BY COVID 19'S OMICRON VARIANT BEGAN TO IMPACT CALIFORNIA AND THE SAN DIEGO COUNTY AREA AROUND THE END OF DECEMBER 2021 AND HAS HAD A NOTICEABLE IMPACT ON ECONOMIC RECOVERY.

MANY WORKPLACES EXTENDED REMOTE WORK INDEFINITELY, WHICH IS AN INDICATOR OF CONTINUED OPERATIONAL UNCERTAINTY FOR SOME INDUSTRIES THAT RELY ON PEOPLE BEING ON SITE, LIKE MANUFACTURING. MANY EMPLOYERS ALSO REPORTED SIGNIFICANT WORKFORCE SHORTAGES DUE TO SICKNESS OR CLOSE CONTACTS.

THIS WAS AMPLIFIED BY CLASSROOM AND DAYCARE CLOSURES, WHICH HAVE AN IMPACT ON WORKING PARENTS ABILITY TO BE AT WORK.

IN SAN DIEGO COUNTY, IT IS ESTIMATED THAT NEARLY 300000 FAMILIES WITH SCHOOL AGED CHILDREN HAVE BOTH PARENTS IN THE WORKFORCE.

AS WITH DELTA, THE IMPACT OF THE OMICRON SURGE IN SAN DIEGO COUNTY WAS BLUNTED, IN PART BY HIGH VACCINATION RATES AND CONTINUED CAPACITY IN THE REGION'S HEALTH CARE SYSTEM.

DESPITE THE SIGNIFICANT CASE SURGE, SAN DIEGO HOSPITALS STILL HAD ROUGHLY 30 PERCENT CAPACITY REGIONWIDE IN MID-JANUARY.

BUT LOOKING AT CARLSBAD, SPECIFICALLY IN 2019, CARLSBAD, THE ECONOMY GREW BY $800 MILLION TO NEARLY 13.6 BILLION IN 2020.

AS A RESULT OF THE PANDEMIC, THE CITY'S GRP REMAINED FLAT IN 2021.

CARLSBAD ECONOMY GREW BY APPROXIMATELY $1 BILLION TO NEARLY FOURTEEN POINT SIX BILLION.

THIS GROWTH WAS SEEN ACROSS ALL INDUSTRY CATEGORIES AND WAS LED BY MANUFACTURING, WHOLESALE TRADE AND PROFESSIONAL SCIENTIFIC AND TECHNICAL SERVICES.

THE UNEMPLOYMENT RATE IN CARLSBAD WAS 3.4 PERCENT IN DECEMBER, WHICH IS THE LOWEST IT HAS BEEN SINCE BEFORE THE PANDEMIC AT THE STATE LEVEL.

UNEMPLOYMENT DID RISE SLIGHTLY IN DECEMBER, LIKELY IN PART DUE TO THE OMICRON SURGE.

BUT SAN DIEGO COUNTY AND THE CITY OF CARLSBAD CONTINUE TO SEE UNEMPLOYMENT RECOVER.

NATIONAL UNEMPLOYMENT DATA FOR JANUARY SUGGESTS A CONTINUED DOWNWARD DOWNWARD TREND IN UNEMPLOYMENT AS THE NATION ADDED 467 THOUSAND JOBS IN JANUARY.

NEW JOB POSTINGS CONTINUE TO INCREASE IN CARLSBAD, LED BY OPENINGS IN MANUFACTURING, ADMINISTRATIVE SERVICES AND PROFESSIONAL SCIENTIFIC AND TECHNICAL POSITIONS? THE AVERAGE POSTED SALARY FOR POSTED JOBS WAS FORTY ONE DOLLARS AND SIX, EXCUSE ME, FORTY ONE THOUSAND SIX HUNDRED DOLLARS, WHICH IS A DECREASE OF $4000 SINCE THE LAST QUARTER.

THIS IS POSSIBLY INDICATING POSTINGS MAY BE ORIENTED MORE TOWARD SERVICE INDUSTRY AND ENTRY LEVEL POSITIONS.

NOTABLY, EMPLOYERS AND SERVICE AND ACCOMMODATION SECTORS HAVE EXPRESSED CONTINUING DIFFICULTY TO FILL JOBS.

LOOKING AT COMMERCIAL REAL ESTATE, THE CARLSBAD INDUSTRIAL VACANCY RATE CONTINUED TO FALL LAST QUARTER, ENDING THE YEAR AT THREE POINT NINE PERCENT.

VACANCY OFFICE AND RETAIL VACANCIES REMAIN ELEVATED BUT ARE RELATIVELY STABLE.

AVERAGE MARKET RENT PER SQUARE FOOT HAS ALSO BEGUN TO CLIMB, SURPASSING PRE-PANDEMIC LEVELS FOR THE FIRST TIME IN RETAIL, WHICH IS NOW AT $41 AND 60 CENTS, AND OFFICE, WHICH IS NOW AT THIRTY SIX DOLLARS AND THIRTY THREE CENTS SEGMENTS.

INDUSTRIAL SPACE, WHICH CAN CONSTANTLY CLIMBED DURING THE PANDEMIC, IS NOW AT $18 AND FORTY EIGHT CENTS PER SQUARE FOOT ON AVERAGE.

CARLSBAD TOURISM INDUSTRY SAW A SIGNIFICANT RECOVERY OVER THE SUMMER MONTHS, WITH HOTEL OCCUPANCY NEARING 2019 LEVELS IN JULY.

ROOM RATES FULLY RECOVERED AND EXCEEDED 2019 LEVELS IN JUNE AND HAVE MAINTAINED AT A HIGHER RATE THROUGH DECEMBER.

THE LATEST MONTH AVAILABLE IN THE LAST QUARTER.

AVERAGE DAILY ROOM NIGHTS ROOM RATE AVERAGE $31 HIGHER THAN THE SAME QUARTER IN 2019.

WHILE OCCUPANCY HAD A STEEPER THAN NORMAL DECLINE IN AUGUST, WE WOULD NORMALLY SEE A

[01:05:01]

DECLINE IN SEPTEMBER.

THE OCCUPANCY DATA MORE SIMILARLY MATCHES A NORMAL YEAR WITH DECEMBER 2021 OCCUPANCY ONLY LAGGING DECEMBER 2019 BY ONE PERCENTAGE POINT.

THE IMPACT OF THE OMICRON SURGE MAY CONTINUE TO LINGER IN THE COMING MONTHS, BUT HOTELIERS ARE BECOMING BULLISH ON THE RETURN OF GROUP TRAVEL LIKE CONVENTIONS, CONFERENCES AND EVENTS.

RESIDENTIAL REAL ESTATE VALUES IN CARLSBAD HAVE CONTINUED TO RISE SIGNIFICANTLY.

HOME VALUES IN CARLSBAD, ALONG WITH THE SAN DIEGO REGION, CONTINUE TO RISE, WITH MEDIAN HOME PRICES IN THE CITY AT 1.3 MILLION DOLLARS IN DECEMBER.

A GAIN OF FIVE PERCENT OVER THE PREVIOUS QUARTER.

THIS VALUE IS SEASONALLY ADJUSTED AND ONLY INCLUDES THE MIDDLE PRICE TIER OF HOMES.

CARLSBAD HOME VALUES HAVE RISEN 32 PERCENT OVER THE PAST YEAR, ACCORDING TO ZILLOW.

THE FORECAST FOR THE NEXT YEAR SHOWS VALUES INCREASING AN ADDITIONAL 21 PERCENT FROM TODAY'S PRICES.

THIS SURGE IN HOME VALUES CAN STILL BE PARTIALLY ATTRIBUTED TO HIGH DEMAND AND LOW SUPPLY. AFTER AN ANOMALY IN ACTIVITY LAST QUARTER, BUSINESS LICENSES, OUR BUSINESS LICENSE ACTIVITY RECOVERED TO HISTORICAL NORMS. THERE WERE A TOTAL OF TWO THOUSAND FOUR HUNDRED AND FIFTEEN BUSINESS LICENSES ISSUED LAST QUARTER, INCLUDING ONE THOUSAND THIRTY FIVE NONRESIDENTIAL, FIVE HUNDRED AND NINETY EIGHT RESIDENTIAL AND 782 OUTSIDE THE CITY LICENSES.

AS A NOTE, THE NUMBER OF LICENSES ISSUED DOES NOT REFLECT THE NUMBER OF BUSINESSES IN CARLSBAD. AS A BUSINESS MAY CARRY MULTIPLE LICENSES.

SHORT TERM VACATION RENTALS ARE REQUIRED TO GET A LICENSE IN BUSINESSES OUTSIDE THE CITY THAT DO BUSINESS IN THE CITY OR WITH THE CITY ARE REQUIRED TO HAVE A LICENSE.

IT IS ESTIMATED THAT THERE ARE APPROXIMATELY SIX THOUSAND THREE HUNDRED AND TWENTY SEVEN BUSINESSES IN CARLSBAD BETWEEN OCTOBER AND DECEMBER.

PERMIT ACTIVITY INCREASED FOR BOTH RESIDENTIAL AND COMMERCIAL PERMITS ISSUED.

THE NUMBER OF RESIDENTIAL PERMITS ISSUED.

NINE HUNDRED AND NINETY ONE WAS AN INCREASE OF ONE HUNDRED AND FIFTY FOUR OVER THE SAME QUARTER IN 2020.

COMMERCIAL PERMITS ISSUED AT ONE HUNDRED AND SEVENTEEN WAS AN INCREASE OF 18 OVER THE SAME QUARTER IN 2020, WHILE PERMIT ACTIVITY IS IMPROVING YEAR OVER YEAR.

RESIDENTIAL BUILDERS HAVE CITED LABOR SHORTAGES AND INCREASED BUILDING MATERIALS COSTS AS CHALLENGES TO NEW HOUSING STARTS.

IN GENERAL, INDICATORS SUGGEST THAT CARLSBAD HAS WEATHERED THE PANDEMIC BETTER THAN MOST CITIES AND REGIONS, NOTABLY, GROUP BUSINESS LIKE CONVENTIONS, CONFERENCES AND CORPORATE EVENTS HAVE NOT RECOVERED AS MANY CONTINUE TO DELAY SCHEDULING.

BUT AS NOTED, THERE IS SOME OPTIMISM THERE.

THE SECTOR WILL CONTINUE TO BE THE MOST VULNERABLE TO FLUCTUATIONS IN CASE RATES AND CONSUMER CONFIDENCE.

THE SUPPLY CHAIN CHALLENGES THAT HAMPERED BUSINESSES AND CONSUMERS LAST QUARTER ARE SUBSIDING, BUT MAY CONTINUE TO HAVE AN IMPACT THROUGH THE NEXT QUARTER.

INFLATION WILL CONTINUE TO PUSH PRICES HIGHER, STRAINING CONSUMERS AND BUSINESSES.

MONETARY POLICY TO ADDRESS INFLATION WILL HAVE SOME IMPACT ON THINGS LIKE INTEREST RATES, BONDS, ET CETERA. AND NOW I'LL TURN THE PRESENTATION OVER TO ROXANNE MR., THE CITY'S ASSISTANT FINANCE DIRECTOR.

THANK YOU. THANK YOU FOR THE ECONOMIC UPDATE, MATT, AND GOOD AFTERNOON, MAYOR, MAYOR, PRO TEM AND CITY COUNCIL MEMBERS.

SO NOW WE'LL TAKE YOU THROUGH THE HIGHLIGHTS OF THE CITY'S GENERAL FUND REVENUES AND EXPENDITURES FOR THE FIRST HALF OF THE FISCAL YEAR 21-22, WHICH IS THE MONTH OF JULY THROUGH DECEMBER OF 2021.

ALSO BRIEFLY TOUCH UPON THE CITY'S WATER, WASTEWATER AND GOLF COURSE ENTERPRISE FUNDS.

SO THIS FIRST SLIDE HERE, IT SHOWS THE GENERAL FUND REVENUES FOR THE FIRST HALF OF OUR FISCAL YEAR. THIS CHART SHOWS THE CURRENT YEAR TO DATE REVENUES IN BLUE, WHICH IS THE RIGHT HAND OR THE THIRD COLUMN IN EACH OF THE SECTIONS THERE ON THE CHART.

THE SAME PERIOD YEAR TO DATE QUARTER TWO OF LAST FISCAL YEAR IS IN ORANGE, WHICH IS THE FIRST BARS AND THE EXPECTED YEAR TO DATE REVENUES FOR THE CURRENT FISCAL YEAR IS THE SECOND OR THE GREEN COLUMN THERE.

THE SEGMENTS ALONG THE BOTTOM OF THE SCREEN REPRESENT THE MAJOR REVENUE COMPONENTS OF THE CITY'S GENERAL FUND IN THE UPCOMING SLIDES.

WE'LL LOOK AT EACH OF THESE COMPONENTS IN A LITTLE GREATER DETAIL, BUT IN GENERAL, LOOKING AT HOW THE CITY'S REVENUES COMPARE TO THE PRIOR YEAR.

BY COMPARING THE THIRD BAR TO THE FIRST BAR IN EACH CATEGORY, TRANSIENT OCCUPANCY TAX OR TOT AND SALES TAX THAT STAND OUT AS HAVING LARGE INCREASES FROM OVER THE PRIOR YEAR AND THE MAJORITY OF THE OTHER CATEGORIES ARE OUTPERFORMING WHEN COMPARED TO THE PRIOR YEAR AS WELL. IT'S IMPORTANT TO POINT OUT THAT LAST YEAR, DURING THIS PERIOD, THE CITY, COUNTY AND STATE WERE STILL IN VARIOUS STAGES OF REOPENING DUE TO COVID 19.

IF YOU REMEMBER, I THINK WE WERE IN THE COLORED TIER SYSTEM.

AND ADDITIONALLY, LAST YEAR, SAN DIEGO WAS IN A NEW STAY AT HOME ORDER FOR THE BEGINNING, I THINK DECEMBER 2020, I WANT TO SAY THE END OF JANUARY 2021.

NEXT SLIDE, PLEASE. SO THIS SLIDE SHOWS THIS TABLE IS A NUMERIC REPRESENTATION REPRESENTATION OF THE SLIDE, I JUST SHOWED YOU THE BAR CHART. IT COMPARES GENERAL FUND REVENUES FOR THE FIRST HALF OF THE CURRENT FISCAL

[01:10:04]

YEAR VERSUS THE SAME PERIOD IN THE PRIOR FISCAL YEAR.

SO THE FIRST COLUMN THERE IS THE PRIOR YEAR IN THE SECOND COLUMN IS THE CURRENT YEAR.

IN TOTAL, REVENUES FOR THE FIRST HALF ARE UP BY SEVENTEEN MILLION OR TWENTY FOUR PERCENT OVER THE SAME PERIOD LAST YEAR.

IN THE LITTLE BOX THERE, THIS IS LARGELY DRIVEN BY TRANSIENT OCCUPANCY TAX AND SALES TAX.

HOWEVER, YOU ALSO SEE THAT OTHER CATEGORIES ARE MOVING IN A POSITIVE DIRECTION.

NEXT SLIDE. SO THIS CHART LOOKS SIMILAR, BUT THIS CHART IS SHOWING THE EXPECTED REVENUES FOR THE CURRENT FISCAL YEAR IN THE FIRST COLUMN THERE COMPARED TO OUR ACTUAL ACTUAL REVENUES THAT WE'VE COLLECTED FOR THIS FIRST HALF OF THE FISCAL YEAR.

THIS, IF WE WERE ON THE OTHER CHART, IT WOULD BE THE GREEN IN THE BLUE BARS FROM THE CHART. A QUICK EXPLANATION ON THE EXPECTED COLUMN.

THIS REPRESENTS THE BUDGETED REVENUE FOR THE FULL YEAR OF FISCAL YEAR 21-22 MULTIPLIED BY THE PROPORTION THAT THE CITY RECEIVED DURING THE SAME PERIOD IN THE PRIOR FISCAL YEAR.

AS YOU CAN SEE FROM THE SLIDE, THE CITY HAS RECEIVED MORE REVENUES THAN EXPECTED FOR THE FIRST HALF OF THE FISCAL YEAR BY A TOTAL OF SIXTEEN POINT NINE MILLION.

THE INCREASE IS DRIVEN BY THE VERY LARGE VARIANCE, IN TRANSIENT OCCUPANCY TAX AND SALES TAX REVENUES.

I WANT TO CAUTION, THOUGH, WHEN MAKING COMPARISONS WITH THE EXPECTED REVENUES THAT WOULD BE MORE REALISTIC IF IN THE PRIOR YEAR WAS A NORMAL YEAR IN REVENUE, PARTICULARLY WITH TOT. BUT DUE TO THE IMPACTS ON THE TIMING OF REVENUES THAT COVID 19 SHUTDOWNS HAD IN THE PRIOR YEAR, THIS IS NOT ALWAYS THE BEST METRIC FOR THESE PARTICULAR CATEGORIES.

AS THE TIMING OF WHEN REVENUES WERE RECEIVED WAS LARGELY SKEWED IN SOME CASES AND EXPECTED SIMPLY LOOKS AT THE PERCENTAGE OF REVENUES RECEIVED THROUGH QUARTER TWO OF THE PRIOR YEAR. NEXT SLIDE.

SO NOW, IF WE LOOK AT THE CITY'S LARGEST GENERAL FUND REVENUE SOURCES, THE TOP SOURCE IS PROPERTY TAX.

THE MAJORITY OF OUR PROPERTY TAXES ARE COLLECTED IN DECEMBER AND APRIL OF EVERY YEAR.

ASSESSED VALUES ARE THE BIGGEST DRIVER OF PROPERTY TAX REVENUES, AND ACCORDING TO THE COUNTY ASSESSOR'S OFFICE, ASSESSED VALUES IN CARLSBAD DID INCREASE IN TOTAL BY THREE POINT ONE FOUR PERCENT THIS YEAR.

TODAY, WE HAVE SEEN A SLIGHT DECREASE IN PROPERTY TAX REVENUE WHEN COMPARED TO THE SAME PERIOD LAST YEAR, ABOUT SIX HUNDRED AND SEVENTY THOUSAND.

BUT THAT DECREASE IS MOSTLY DRIVEN BY THE TIMING OF RECEIPTS, WHICH CAN VARY FROM YEAR TO YEAR. ALSO PART OF THAT DECREASE IS A DECREASE IN AIRCRAFT TAXES RECEIVED.

THIS IS, THE CITY COLLECTS TAXES ON ASSESSABLE AIRCRAFT THAT IS DOMICILED AT PALOMAR AIRPORT, AND WHEN AIRCRAFT COUNTS DECREASE, WE SEE A DIP IN THE AIRCRAFT TAXES.

ALRIGHT NEXT SLIDE, PLEASE.

SALES TAX, SO THE CITY'S SECOND LARGEST GENERAL FUND REVENUE IS SALES TAX.

THE MAJORITY OF REVENUES RECEIVED TO DATE ARE FROM THE SECOND AND THIRD QUARTERS OF CALENDAR YEAR 20-21. WHICH IS WHEN THERE WAS A SIGNIFICANT AMOUNT OF ECONOMIC ACTIVITY SEEN, WHICH WAS KIND OF THE START OF A PANDEMIC REBOUND.

KEY GAINS DURING THIS TIME, WE'RE SEEN IN AMUSEMENT PARKS, MOTOR VEHICLE MANUFACTURING, GASOLINE STATIONS, GENERAL MERCHANDISE STORES AND TRAVELER ACCOMMODATIONS.

NEXT TIME. SO OUR THIRD LARGEST REVENUE SOURCE FOR THE GENERAL FUND IS TRANSIENT OCCUPANCY TAX, TOT, REVENUES TO DATE REPRESENT TOT COLLECTED BY HOTELS FOR STAYS BETWEEN JUNE AND NOVEMBER OF 2021.

FISCAL YEAR TO DATE, REVENUES ARE SIXTEEN POINT NINE MILLION, WHICH IS AN INCREASE OF TEN POINT THREE MILLION WHEN COMPARED TO THE SAME PERIOD LAST YEAR.

THIS LARGE VARIANCE BETWEEN PRIOR YEAR AND THIS YEAR IS THE DIRECT RESULT OF HIGHER AVERAGE DAILY RATES AND HIGHER OCCUPANCY RATES DUE TO THE RELEASE OF PENT UP DEMAND FROM COVID 19 RELATED TRAVEL RESTRICTIONS AND THE SHELTER IN PLACE ORDERS THAT WERE PREVIOUSLY IN EFFECT. THE AVERAGE OCCUPANCY DURING THE LAST 12 MONTHS HAS BEEN SIXTY ONE POINT SIXTY ONE PERCENT, COMPARED TO FORTY NINE PERCENT FOR THE SAME PERIOD IN THE PREVIOUS YEAR.

THE MAJORITY OF TOT WE'VE COLLECTED TO DATE IS LARGELY FROM TOURIST ACTIVITY VERSUS ANY GROUP EVENTS. NEXT SLIDE.

YES, WE DO HAVE SEVERAL OTHER TAXES IN THE CITY.

BUSINESS LICENSE TAXES CAME IN AT THREE POINT THREE MILLION FOR THIS FISCAL YEAR AND ARE TWENTY THREE PERCENT HIGHER THAN DURING THE SAME PERIOD LAST YEAR.

HOWEVER, THE PRIMARY DRIVER FROM THIS INCREASE IS WE RECEIVED ONE TIME PAST DUE PAYMENTS, AND IT WASN'T REALLY A NOTABLE INCREASE IN NEW BUSINESS LICENSE REVENUES.

FRANCHISE TAXES ARE ESSENTIALLY THE SAME AS LAST YEAR AT ONE POINT FIVE MILLION TO DATE.

AND THIS IS BECAUSE THE MAJORITY OF FRANCHISE TAXES PAID IN APRIL EVERY YEAR BY SDG&E.

TRANSFER TAXES ON REAL PROPERTY SALES RECEIVED TO DATE IS ONE POINT ONE MILLION, WHICH IS SEVENTY FOUR PERCENT HIGHER WHEN COMPARED TO LAST FISCAL YEAR.

THIS INCREASE IS DUE TO A HIGHER NUMBER OF PROPERTY SALES IN CARLSBAD.

NEXT SLIDE. INCOME FROM INCOME, FROM PROPERTY AND INVESTMENTS, SO THIS IS UP WHEN

[01:15:03]

COMPARED TO LAST YEAR, A BIG DRIVER OF THIS IS FROM RECREATION RELATED RENTALS, WHICH IS NOT SURPRISING BECAUSE THE CITY SERVICES WERE CLOSED LAST YEAR AROUND THIS TIME DUE TO COVID 19. THE TREASURES PORTFOLIO CONTINUES TO SEE DECLINING YIELDS, WHICH IS IN LINE WITH THE MARKET. THE FOCUS ON THE TREASURER'S PORTFOLIO WILL CONTINUE TO BE SAFETY OF CITY ASSETS FIRST, FOLLOWED BY LIQUIDITY AND THEN RETURN ON INVESTMENT.

NEXT SLIDE. SO THE CITY'S OTHER REVENUES ARE GENERATED FROM AMBULANCE FEES, RECREATIONAL REVENUES, DEVELOPMENT FEES AND REVENUES FROM OTHER INTER-GOVERNMENTAL SOURCES.

THESE ARE PRIMARILY DOWN THIS YEAR BECAUSE IN THE PRIOR YEAR THE CITY DID RECEIVE SOME COVID 19 CARES ACT ASSISTANCE.

BUT OFFSETTING THIS DECLINE, WE'RE SEEING A RECREATION FEE.

REVENUE CONTINUES TO INCREASE THIS FISCAL YEAR AS MORE PROGRAMS AND CLASSES ARE OFFERED.

NEXT SLIDE, I'M GOING TO SWITCH OVER TO EXPENDITURES.

THIS IS THE GENERAL FUND EXPENDITURES, AND THIS CHART SHOWS THE BUDGET EXPENDITURES FOR THE FULL FISCAL YEAR TO DATE IN ORANGE, THE FIRST COLUMN, WHICH IS THE FIRST BAR IN THE CATEGORY, THE GREEN OR MIDDLE BAR SHOWS LAST YEAR'S EXPENDITURES AND OPEN ENCUMBRANCES FOR THE FIRST HALF OF THE FISCAL YEAR, AND THIS YEAR'S EXPENDITURES IN OPEN ENCUMBRANCES THROUGH THE FIRST HALF OF THE CURRENT FISCAL YEAR ARE SHOWN IN BLUE OR THE BAR ON THE RIGHT OF EACH CATEGORY.

AS YOU SEE, THE PERSONNEL COST IS HIGHER THAN THE PRIOR YEAR, BUT THIS YEAR INCLUDES A LARGE CALPERS DISCRETIONARY PAYMENT THAT WAS APPROVED BY THE CITY COUNCIL THIS PAST SEPTEMBER. THE ADOPTED BUDGET ALSO APPROVED TWENTY THREE NEW FULL TIME POSITIONS, TWENTY OF WHICH WERE DIRECTLY RELATED TO CITY COUNCIL GOALS.

THE MAINTENANCE AND OPERATIONS BAR IS SLIGHTLY HIGHER THAN LAST YEAR, WHICH IS TRACKING RIGHT AT THE FULL YEAR EXPECTED EXPENDITURES RATE.

NOW, THE TRANSFERS OUT IS SIGNIFICANTLY HIGHER AT THIS POINT IN THE FISCAL YEAR DUE TO TWO COUNCIL APPROVED TRANSFERS OUT OF THE GENERAL FUND TO THE CITY'S CAPITAL PROJECT FUNDS. THIS YEAR, THE FUNDS PREVIOUSLY HELD IN THE INNOVATION FUND WERE TRANSFERRED TO THE NEW TECHNOLOGY INVESTMENT PROGRAM FUND, SIMILAR TO A CITY CIP FUND.

AND SECONDLY, SURPLUS FUNDS FROM FISCAL YEAR 2020-21 WERE TRANSFERRED TO THE GENERAL CAPITAL CONSTRUCTION FUND.

NEXT SLIDE. SO THIS SLIDE IS JUST A NUMERIC REPRESENTATION OF THE BAR CHART THAT WE JUST SAW. IT SHOWS TO DATE WE HAVE SPENT FIFTY ONE PERCENT OF OUR PERSONNEL BUDGET AND SPENT AND OR ENCUMBERED FIFTY FOUR PERCENT OF OUR MAINTENANCE AND OPERATIONS BUDGET.

THESE TWO CATEGORIES COMPRISE EIGHTY SEVEN PERCENT OF OUR OVERALL WORKING BUDGET.

AND I DO WANT TO MAKE A NOTE HERE THAT THESE PERCENTAGES REPRESENT ACTUAL EXPENDITURES TO DATE, AS WELL AS ANY OPEN PURCHASE ORDER COMMITMENTS DEPARTMENTS HAVE PROCESSED.

THESE OPEN PURCHASERS HAVE BEEN COMMITTED, BUT NOT YET FULLY SPENT.

MANY DEPARTMENTS OPEN PURCHASERS AT THE BEGINNING OF A FISCAL YEAR FOR CONTRACTS THAT RUN THE FULL FISCAL YEAR.

THIS ALLOWS THE DEPARTMENT TO SET ASIDE OR COMMIT THE BUDGET NEEDED FOR THE FULL YEAR CONTRACT. THE PURCHASE ORDER IS THEN REDUCED AS EXPENDITURES ARE MADE DURING THE YEAR.

AN EXAMPLE OF THIS WOULD BE OUR ANNUAL CONTRACT WITH THE HUMANE SOCIETY FOR ANIMAL CONTROL SERVICES, THAT PURCHASE ORDER IS ALMOST EIGHT HUNDRED THOUSAND IS OPENED IN JULY OF EACH YEAR TO COMMIT THE FUNDS, BUT THOSE PAYMENTS ARE MADE MONTHLY.

NEXT SLIDE. SO I KNOW THIS LOOKS VERY SIMILAR TO THE PRIOR SLIDE, BUT IT DOES BREAK OUT TO SHOW THE CURRENT BALANCE OF OPEN PURCHASE ORDERS.

YOU CAN SEE THAT WE'RE SHOWING IN THE FIRST COLUMN THE ANNUAL BUDGET, JUST LIKE THE PRIOR SLIDE. THE SECOND COLUMN, THOUGH, ONLY SHOWS OUR EXPENDITURES TO DATE.

IT DOES NOT INCLUDE OUR OPEN PURCHASE ORDER COMMITMENTS.

SO THE THIRD COLUMN THERE, THE PERCENTAGE IT SHOWS WHAT WE'VE ACTUALLY SPENT TO DATE OF OUR BUDGET. YOU CAN SEE FOR PERSONNEL, WE'RE RIGHT AT THE FIFTY ONE PERCENT MARK, AND THAT'S THE SAME AS THE LAST SLIDE BECAUSE WE DON'T THERE WOULDN'T BE OPEN POS ON PERSONNEL COSTS. BUT THAT MAINTENANCE AND OPERATIONS LINE, WHEN WE EXCLUDE OPEN PURCHASERS, WE'RE AT THIRTY TWO PERCENT OF THE BUDGET SPENT TO DATE.

AND THE NEXT COLUMN SHOWS THE CURRENT AMOUNT OF OPEN PURCHASE ORDERS AND THEN THAT FINAL COLUMN IS THE SAME PERCENTAGE AS SEEN ON THE PRIOR SLIDE THAT SHOWS WHAT WE HAVE SPENT AND OR COMMITTED TO DATE, AND THAT SHOWS THAT WE HAVE COMMITTED FIFTY SIX PERCENT OF OUR BUDGET. WE DO CONTINUALLY TRACK AND ANALYZE OPEN PURCHASE ORDERS WITH ALL DEPARTMENTS TO MAKE SURE AMOUNTS ARE APPROPRIATE AND UP TO DATE.

NEXT SLIDE. SO JUST TO RECAP, OUR GENERAL FUND BUDGET WAS ADOPTED AT ONE HUNDRED AND EIGHTY FOUR POINT SIX MILLION FOR THIS FISCAL YEAR.

THE WORKING BUDGET IS HIGHER THAN THAT.

IT IS TWO HUNDRED AND TWENTY ONE POINT EIGHT MILLION AND THAT IS COMPRISED OF OUR ADOPTED BUDGET, PLUS ANY OPEN PURCHASE ORDERS AT JUNE 30TH THAT ROLLED INTO OUR CURRENT FISCAL YEAR, PLUS ANY APPROVED CARRY FORWARDS.

THE AVAILABLE BUDGET REMAINING FOR THE REMAINDER OF THIS FISCAL YEAR IS NINETY SIX POINT FIVE MILLION, OR FORTY FOUR PERCENT.

THIS NUMBER TAKES INTO ACCOUNT ALL EXPENDITURES YEAR TO DATE THROUGH DECEMBER 2021, AS WELL AS ALL OPEN PURCHASE ORDER COMMITMENTS.

[01:20:02]

NOW, NEXT SLIDE. SO I'M BRIEFLY JUST GOING TO TOUCH ON THE WATER AND WASTEWATER FUNDS WITH THE REOPENING AND AN EXPANSION OF THE ECONOMY, WE'VE SEEN INCREASES IN BOTH REVENUES AND EXPENDITURES IN BOTH WATER AND WASTEWATER FUNDS FOR THE FIRST HALF OF THE FISCAL YEAR.

NEXT SLIDE. AND FINALLY, OUR GOLF COURSE CONTINUES TO PERFORM STRONGLY WITH NET OPERATING INCOME FIVE HUNDRED AND FORTY THOUSAND HIGHER THAN LAST YEAR.

AT THE SAME TIME, DEMAND FOR GOLF HAS TAPERED SLIGHTLY WHEN COMPARED TO LAST YEAR AT THIS TIME, BUT NOT AS MUCH AS EXPECTED.

THE SLIGHT DROP OFF WAS BOOSTED BY THE FOOD AND BEVERAGE SALES, PARTICULARLY ON THE BANQUET AND OTHER EVENTS, WHICH HAS PICKED BACK UP SINCE SOME OF THESE RESTRICTIONS HAVE LIFTED. NEXT SLIDE.

SO THE FINANCE AND ECONOMIC DEVELOPMENT DEPARTMENTS, WE PUBLISHED REPORTS ON THE CITY'S WEBSITE, WHICH I'VE LISTED HERE.

AND BEFORE I TURN IT OVER FOR OUR MID-YEAR BUDGET UPDATE, I WANTED TO PAUSE TO SEE IF THERE ARE ANY QUESTIONS.

ANY QUESTIONS? I DON'T SEE EVERYBODY FROM THIS SLIDE.

OK, WELL, WE'LL ALSO HAVE TIME AT THE END IF WE COME UP WITH ANYTHING.

BUT WITH THAT, I'LL TURN IT OVER TO BRIDGET DRURY, OUR FINANCE MANAGER, FOR AN UPDATE ON THE CITY'S BUDGET. THANK YOU, ROXANNE.

GOOD AFTERNOON.

AS SHE MENTIONED, I'LL BE GOING OVER THE CITY'S MID-YEAR BUDGET REVIEW, SO A LITTLE BACKGROUND IN GENERAL, THE CITY IS CONSTANTLY CONSIDERING ITS SHIFTING NEEDS.

AND THIS YEAR, THE MID-YEAR BUDGET PROCESS WAS NOT COMPLETED IN ORDER TO RE-BUDGET, BUT RATHER TO RESPOND TO ANY UNANTICIPATED NEEDS.

WE LOOKED AT HOW WE WERE SPENDING TO PROJECT AN IDENTIFIED BUDGET SAVINGS AND THEN MADE A FEW MODIFICATIONS TO HELP CONTINUE TO BUDGET WELL FOR THE SECOND HALF OF THE YEAR.

THE CITY INITIATED THE MID-YEAR BUDGET REVIEW FOR FISCAL YEAR 21-22 BACK IN NOVEMBER OF 2021. THE FINANCE DEPARTMENT LED THIS EFFORT IN COLLABORATION WITH ALL CITY DEPARTMENTS TO FORECAST CHANGES TO REVENUES AND EXPENDITURES COMPARED TO THEIR CURRENT BUDGETS, AND THE MID-YEAR BUDGET REVIEW WAS BASED ON THE FIRST FIVE MONTHS OF ACTUAL ACTIVITY IN FISCAL YEAR 21-22.

DEPARTMENTS ALSO IDENTIFIED AREAS OF POTENTIAL UNDERSPENDING THAT WOULD RESULT IN SAVINGS, AND ALTHOUGH THERE WERE SOME SAVINGS IDENTIFIED IN OUR NORMAL MAINTENANCE AND OPERATIONS BUDGETS FOR THINGS LIKE CONTRACTED SERVICES AND SUPPLIES.

MANY DEPARTMENTS IDENTIFIED A TREND OF PRETTY SIGNIFICANT SAVINGS WITHIN THEIR PERSONNEL BUDGETS, SO THIS WOULD BE A RESULT FROM CIRCUMSTANCES LIKE UNPLANNED VACANCIES, RETIREMENTS OR THINGS OF THAT NATURE.

SO THE END RESULT OF THIS REVIEW WERE THAT WE HAD SOME CHANGES TO THE EXPENDITURE BUDGETS AND SOME TRANSFERS OF BUDGET.

NOW, THE CITY MANAGER AUTHORIZED A NUMBER OF INDIVIDUAL BUDGET TRANSFERS BETWEEN GENERAL FUND DEPARTMENTS TO ACCOMMODATE CERTAIN MID-YEAR BUDGET REQUESTS, BUT IT'S IMPORTANT TO NOTE THAT THE IDENTIFIED GENERAL FUND BUDGET SAVINGS SO FAR THIS FISCAL YEAR WERE ABLE TO ABSORB ALL OF THE TRANSFERS, WHICH RESULTED IN A ZERO DOLLAR BUDGET IMPACT TO THE GENERAL FUND THIS FISCAL YEAR.

SOME OF THE REASONS FOR THE APPROVED MID-YEAR BUDGET TRANSFERS ARE PRESENTED HERE ON THIS SLIDE. I'LL GO OVER THEM BRIEFLY.

AS I MENTIONED, WE MOVED BUDGET FROM DEPARTMENTS THAT IDENTIFIED ACTUAL REALIZED PERSONNEL BUDGET SAVINGS FROM THE FIRST HALF OF THE FISCAL YEAR.

THERE WERE IDENTIFIED SAVINGS WITHIN A COUPLE DEPARTMENTS FOR MAINTENANCE AND OPERATIONS EXPENDITURES COMING IN LESS THAN EXPECTED.

WE MADE SURE THAT DEPARTMENTS HAD ENOUGH FUNDS IN THEIR PERSONNEL BUDGETS FOR THE MANAGEMENT AND PART TIME PAY ADJUSTMENTS THAT CITY COUNCIL APPROVED EARLIER IN JANUARY.

AND THEN WE TRANSFERRED BUDGETS SO THAT DEPARTMENT DEPARTMENTS COULD PAY FOR FINAL VACATION PAY COSTS.

SO IN GENERAL, WE WE BUDGET CENTRALLY FOR THIS COST TO THE CITY.

AND THEN ONCE DEPARTMENTS START HAVING THESE ACTUAL COSTS, THEN WE DISTRIBUTE BUDGET WHERE IT'S NEEDED. THEN WE MOVED SOME BUDGET FOR A FEW OTHER DEPARTMENT REQUESTS FOR THINGS LIKE EXPANDING A CONTRACT OR RECLASSIFYING A POSITION.

ONE EXAMPLE OF THIS WAS THE EXPANSION OF A PRESSURE WASHING CONTRACT IN THE VILLAGE, WHICH ADDED ANOTHER WEEKDAY BOTH WEEKENDS AND HOLIDAYS.

SO IN THE CURRENT FISCAL YEAR, THIS ADDED EIGHTY SIX THOUSAND DOLLARS TO THE CONTRACT TO COVER THAT EXPANDED SERVICE.

AND JUST A REMINDER THAT THE CITY MANAGER WAS AUTHORIZED TO APPROVE ALL OF THESE BUDGET TRANSFERS BECAUSE THE INDIVIDUAL ITEMS AND TRANSFERS WERE LESS THAN THE ONE HUNDRED

[01:25:03]

THOUSAND MAXIMUM, WHICH IS STATED AS IN THE BUDGETARY CONTROL SECTION OF THE RESOLUTION THAT APPROVED THIS YEAR'S BUDGET.

ALSO, NONE OF THESE TRANSFERS IMPACTED ANY FTE COUNTS, AND NONE OF THEM RESULTED IN ANY ADDITIONAL APPROPRIATION NEEDED.

ALSO I WOULD LIKE TO MENTION THAT DURING THE MID-YEAR PROCESS, THERE WERE SEVERAL REQUESTS FROM THREE DEPARTMENTS COMMUNICATIONS AND ENGAGEMENT LIBRARY AND CULTURAL ARTS AND THE FIRE DEPARTMENT THAT MADE REQUESTS OUTSIDE OF THE CITY MANAGER'S AUTHORITY, WHICH WOULD REQUIRE CITY COUNCIL APPROVAL.

SO I'LL BE GOING OVER THOSE REQUESTS NOW FOR THE CITY COUNCIL'S CONSIDERATION, BUT WITH THE CAVEAT THAT NONE OF THESE REQUESTS WOULD REQUIRE AN ADDITIONAL APPROPRIATION IN THE CURRENT FISCAL YEAR.

SO BEGINNING WITH COMMUNICATIONS AND ENGAGEMENT, THIS DEPARTMENT IS REQUESTING TO CONVERT FOUR PART TIME PRINTING AND GRAPHICS POSITIONS TO TWO FULL TIME COMMUNITY RELATIONS MANAGER POSITIONS.

ON AN ANNUAL BASIS, THE DEPARTMENT WOULD HAVE INCREASED PERSONNEL COSTS, BUT IT WOULD ALSO BE ABLE TO REDUCE ITS BUDGET FOR CONSULTANTS AND OUTSIDE SERVICES RATHER SIGNIFICANTLY.

SO THE NET EFFECT OF THIS CHANGE WOULD RESULT IN A NET ANNUAL SAVINGS OF ABOUT FORTY ONE HUNDRED DOLLARS. OVERALL, THE DEPARTMENT EXPLAINED THAT THIS CHANGE WILL RESULT IN STRONGER COMMUNITY RELATIONSHIPS AND MORE EFFICIENT OPERATIONS FOR A VARIETY OF REASONS.

SECOND, THE LIBRARY AND CULTURAL ARTS DEPARTMENT IS REQUESTING TO CONVERT TWO OF ITS THREE QUARTER TIME CIRCULATION SUPERVISOR POSITIONS TO FULL TIME POSITIONS, AND AS A PART OF THIS REQUEST, IT WOULD REDUCE ITS PART TIME STAFF BY ONE POINT TWO TWO PART TIME FULL TIME EQUIVALENT. THE NET EFFECT OF THIS CHANGE IS SAVINGS ON AN ANNUAL BASIS OF ABOUT NINE THOUSAND FOUR HUNDRED DOLLARS, AND ACCORDING TO THE DEPARTMENT, THIS CHANGE WILL RESULT IN MANY IMPROVEMENTS FOR THE DEPARTMENT'S OPERATIONS, INCLUDING BETTER ENABLING IT TO RETURN TO PRE-PANDEMIC HOURS SOONER AND IMPROVE STAFF DEVELOPMENT AND ORGANIZATIONAL ALIGNMENT. THE FIRE DEPARTMENT IS REQUESTING A NEW FULL TIME COMMUNITY HEALTH NURSE AND THE RECLASSIFICATION OF AN ADMINISTRATIVE BATTALION CHIEF TO A DIVISION CHIEF, WHICH RESULTS IN AN ONGOING BUDGET INCREASE OF TWO HUNDRED THOUSAND DOLLARS.

NOW, WHEN THE CURRENT FISCAL YEAR.

THIS WOULD REQUIRE A TRANSFER OF TWO HUNDRED AND NINE THOUSAND DOLLARS TO THE FIRE DEPARTMENT'S BUDGET USING THE CURRENT FISCAL YEAR AS IDENTIFIED GENERAL FUND SAVINGS.

THE COSTS ARE RELATED TO SEVERAL MONTHS OF POSITION COSTS, PLUS OTHER NECESSARY ITEMS, INCLUDING AN EKG MONITOR, VEHICLE AND OUTFITTING COSTS, EMERGENCY MEDICAL SERVICES SUPPLIES, AND OTHER NECESSARY COSTS FOR THE POSITION.

OVERALL, THIS NEW COMMUNITY HEALTH NURSE POSITION WILL SUPPORT PUBLIC AND WORKFORCE HEALTH REQUIREMENTS AND SERVE AS A PUBLIC HEALTH SPECIALIST AND HEALTH CARE PROVIDER.

THE POSITION WILL IMPROVE THE RESPONSE TO CURRENT AND FUTURE COMMUNITY HEALTH CONCERNS BY CENTRALIZING RESPONSIBILITIES MANAGED CURRENTLY BY THE HUMAN HUMAN RESOURCES DEPARTMENT, POLICE AND FIRE.

SOME OF THE POSITIONS RESPONSIBILITIES WOULD BE ADMINISTERING VACCINE AND TESTING PROGRAMS, ASSISTING EMPLOYEES WITH TREATMENT PLANS AND EDUCATION.

TREATING LOW ACUITY EMERGENCY MEDICAL CALLS FOR ASSISTANCE.

AND REFERRING UNDERSERVED COMMUNITY MEMBERS TO HEALTH CARE RESOURCES.

THE REQUEST TO RECLASSIFY THE ADMINISTRATIVE BATTALION CHIEF IS CONTINGENT ON THE CITY COUNCIL'S APPROVAL OF THE NEW COMMUNITY HEALTH NURSE POSITION.

SO TO SUMMARIZE, IF THE CITY COUNCIL WERE TO APPROVE ALL THREE OF THESE REQUESTS, THERE WOULD BE NO ADDITIONAL COSTS FOR THE CURRENT FISCAL YEAR, BUT THERE WOULD BE AN ONGOING COST OF TWO HUNDRED THOUSAND DOLLARS RELATED TO THE FIRE DEPARTMENT'S REQUEST.

THE LAST ITEM I WANT TO COVER IS DOESN'T PERTAIN TO ANY SPECIFIC DEPARTMENT.

RATHER, IT DEALS WITH THESE CITIES, OTHER POST-EMPLOYMENT BENEFITS PLAN AND A TRANSFER THAT NEEDS TO BE MADE.

SO IN FISCAL YEAR 2021, CALPERS REQUIRED THE CITY TO COMBINE TWO OF ITS SEPARATE ACCOUNTS. IT'S CMWD ACCOUNT AND THEN THE CITY SEPARATE ACCOUNT.

AND BECAUSE THESE ACCOUNTS WERE FUNDED AT DIFFERING PERCENTAGES, THE COMBINING OF THE TWO ACCOUNTS RESULTED IN THE GENERAL FUND AND SEVERAL OTHER FUNDS OWING CMWD A CASH TRANSFER IN THE AMOUNTS THAT ARE PRESENTED ON THE TABLE THAT YOU CAN SEE ON THE SCREEN HERE.

A LIABILITY TO CMWD WAS RECORDED IN THE FISCAL YEAR 2021 ANNUAL COMPREHENSIVE FINANCIAL

[01:30:02]

REPORT. SO APPROVING AN ADDITIONAL APPROPRIATION AND TRANSFER THIS YEAR IN THE AMOUNTS PRESENTED ON THE SCREEN WILL ELIMINATE THE LIABILITY AND IT WILL NOT TECHNICALLY RESULT IN ANY NET FISCAL IMPACT CITYWIDE.

SO WITH THAT, WE ARE ASKING YOU TO CONSIDER ADOPTING THE RESOLUTION, APPROVING ONE OR MORE OF THE THREE DEPARTMENT REQUESTS.

AND TO CONSIDER ADOPTING THE RESOLUTION AUTHORIZING THE APPROPRIATION AND TRANSFER TO CMWD RELATED TO THAT OPEN PLAN.

AND WITH THAT, THAT CONCLUDES OUR PRESENTATION, AND WE'RE HAPPY TO TAKE ANY QUESTIONS.

I WOULD ALSO I WOULD ALSO LIKE TO ADD THAT WE DO HAVE OUR DIRECTORS HERE.

WE HAVE OUR CHIEF CHIEF CALDERWOOD, KRISTINA RAY, AS WELL AS SUZANNE SMITHSON, IF CITY COUNCIL HAS ANY ADDITIONAL QUESTIONS FOR THE FTE CONVERSIONS AND ADDITIONAL FTE REQUESTS.

OK. DO WE HAVE ANY PUBLIC COMMENT ON THIS ITEM? THIS TIME, I WOULD LIKE TO ASK THOSE WISHING TO SPEAK ON ITEM NUMBER EIGHT TO PLEASE RAISE YOUR HAND VIRTUALLY.

IF YOU'RE USING THE MEETING LINK TO LOG IN OR IF YOU'RE JOINING US BY PHONE, PLEASE PRESS STAR NINE NOW TO RAISE YOUR HAND.

WHEN I CALL YOUR NAME OR LAST THREE DIGITS OF YOUR PHONE NUMBER, PLEASE PRESS STAR SIX TO UNMUTE. YOU WILL HAVE THREE MINUTES TO MAKE YOUR COMMENTS.

YOU WILL BE MUTED ONCE YOUR THREE MINUTES HAVE CONCLUDED.

ONCE AGAIN, PLEASE RAISE YOUR HAND OR PRESS STAR NINE NOW.

WE DO NOT HAVE ANY SPEAKERS.

OK, QUESTIONS.

COUNCIL MEMBER ACOSTA.

THANK YOU. I JUST HAVE A COUPLE OF CLARIFYING QUESTIONS.

THANKS SO MUCH FOR THIS EXCELLENT PRESENTATION.

I WANT TO THANK STAFF FOR ALL THE HARD WORK THAT YOU PUT INTO THIS.

THERE WERE JUST A COUPLE, A COUPLE OF POINTS THAT I JUST WANTED SOME CLARIFICATION ON.

ONE OF THEM WAS ON THE COMMUNICATIONS ADDITIONS, AND I WAS WONDERING IF WE COULD JUST GET A LITTLE CLARIFICATION ABOUT THE KINDS OF OUTREACH THE NEW POSITIONS WOULD BE GIVEN, OR THAT THE RESPONSIBILITIES THAT THOSE NEW POSITIONS WOULD BE GIVEN? SURE. THANK YOU.

WE HAVE SEEN QUITE AN INCREASE IN ENGAGEMENT WITH OUR COMMUNITY OVER THE LAST SEVERAL YEARS. AND SO BASICALLY, WE END UP HAVING TO UTILIZE CONTRACTORS FOR A LOT OF THAT WORK.

AND SO WE DO AS MUCH AS WE CAN WITH OUR OWN STAFF AND THEN THE REST WITH CONTRACTORS.

SO THE NEW PHYSICIANS WOULD DO A SIMILAR ROLE AS OUR EXISTING COMMUNITY RELATIONS MANAGERS, MEANING THEY WOULD DESIGN THE ENGAGEMENT PLAN, THE PUBLIC MEETINGS, PLAN THE ONLINE ENGAGEMENT KIND OF JUST DO A SOUP TO NUTS THAT WHOLE ENGAGEMENT PROCESS AS OPPOSED TO HAVING A CONSULTANT DO THAT WITH OUR SUPERVISION.

GREAT, THANK YOU, AND I UNDERSTAND THAT THERE WILL BE A COST SAVINGS.

AND YES, SO AS PART OF THIS PROPOSAL, WE WOULD DECREASE THE BUDGET THAT WE HAVE EVERY YEAR THAT WE UTILIZE FOR OUTSIDE CONSULTANTS BECAUSE IF WE WERE ABLE TO DO IT IN-HOUSE, WE WOULDN'T NEED TO THEN HAVE QUITE AS MUCH SUPPORT FROM THOSE PUBLIC ENGAGEMENT CONSULTANTS. GREAT.

THANK YOU. AND I BELIEVE I READ ALSO IN THE AGENDA PACKET THAT THERE WOULD BE LESS OF A NEED FOR THE PRINTING AND THE PHYSICAL MATERIALS THAT WE GIVE OUT BECAUSE THERE WILL BE MORE WORK ONLINE, MORE DIGITAL ENGAGEMENTS.

YES, EXACTLY.

AND THIS IS SOMETHING WE'VE BEEN WORKING TOWARD FOR MANY YEARS.

BUT I THINK WITH WHERE THE CITY IS WITH ITS COMMITMENT TO SUSTAINABILITY, I WOULD LIKE TO SEE US CONTINUE THAT PATH AND STILL OFFER SOME THINGS IN PRINT BECAUSE SOME PEOPLE ARE STILL GOING TO WANT THAT. BUT I THINK WITH COVID, IT'S REALLY ACCELERATED THE ACCEPTANCE OF PEOPLE BEING WILLING TO GET THEIR INFORMATION ONLINE VERSUS IN A PRINTED PIECE.

GREAT. GREAT. THANK YOU.

AND THEN I HAD A QUESTION ON ONE OF THE OTHER SLIDES AND THIS WAS RELATED TO THE FIRE DEPARTMENT. THE THE PART ABOUT THE PUBLIC HEALTH NURSE MADE A LOT OF SENSE.

I JUST DIDN'T UNDERSTAND THE PART ABOUT THE BATTALION CHIEF AND WHY THAT WAS NEEDED, THAT TITLE CHANGE AND THAT ADDITIONAL KIND OF EXPENSE FOR THAT, THAT DIFFERENT TITLE.

SO I WAS WONDERING IF YOU COULD JUST EXPLAIN THAT MAYBE THE CHIEF IS THE RIGHT PERSON TO EXPLAIN THAT? YEAH, CERTAINLY THE RECLASSIFICATION OF THE ADMINISTRATIVE BATTALION CHIEF TO DIVISION CHIEF, THE DIFFERENCE IN THE SALARY THERE IS ABOUT SIX THOUSAND DOLLARS A YEAR, SO IT'S NOT A SIGNIFICANT SALARY DIFFERENCE.

BUT WHAT IT DOES IS PROVIDE KIND OF HIERARCHICAL STRUCTURE OF REPORTING STRUCTURE WHERE

[01:35:06]

THE SPAN OF CONTROL WITH AN INDIVIDUAL AND THE NUMBER OF PEOPLE UNDERNEATH THAT INDIVIDUAL, IT GETS OUT OF WHACK WHEN WE HAVE THE NURSE.

AND IF WE MOVE THAT ADMINISTRATIVE BATTALION CHIEF TO A DIVISION CHIEF POSITION, IT MAINTAINS THAT SPAN OF CONTROL WITHIN WITHIN A REALM THAT IS SUSTAINABLE AND ADDS THE PROPER REPORTING STRUCTURE AS DECISIONS ARE MADE AND THINGS MOVE FORWARD.

OK GREAT, THANK YOU.

THOSE ARE MY TWO QUESTIONS BASED ON THAT, BUT I APPRECIATE THIS WAS A KIND OF A BIG, HEFTY AGENDA ITEM, SO THERE WAS A LOT IN THERE, BUT THOSE WERE THE TWO QUESTIONS THAT OCCURRED TO ME TOWARDS THE END AS WE'RE APPROVING KIND OF ADDITIONAL CHANGES AND TRANSFERS. I JUST WANTED TO MAKE SURE THAT I UNDERSTOOD COMPLETELY WHAT I WAS VOTING ON.

SO THANK YOU FOR THOSE.

OTHER QUESTIONS. OKAY, I HAVE ONE OR TWO.

TWICE YOU USED IN CURRENT BUDGET IT WOULD NOT MAKE A DIFFERENCE IN YOUR PRESENTATION.

WHAT DOES IT DO TO NEXT YEAR'S BUDGET, FOR FUTURE BUDGETS? RIGHT. YES, I DID MENTION ESSENTIALLY THE COMMUNICATIONS AND ENGAGEMENT REQUEST AND THE LIBRARY AND CULTURAL ARTS REQUESTS RESULTED IN A VERY SMALL SAVINGS, SO THAT WOULD HAVE NO EFFECT. BUT THE FIRE DEPARTMENT REQUEST IS THE ONE INVOLVING JUST A STRAIGHT ADDITIONAL FTE OR ANOTHER POSITION.

SO IN THE CURRENT YEAR, IT DOESN'T RESULT IN ANY ADDITIONAL COSTS BECAUSE OF THE IDENTIFIED SAVINGS WE HAVE PULLED OUT FROM VACANCIES CITYWIDE THAT WE IDENTIFIED AND THEN ON A FUTURE BASIS, THE ANNUAL SALARY AND BENEFITS FOR THE NEW POSITION, IN ADDITION TO THE RECLASSIFICATION COSTS WOULD BE ABOUT TWO HUNDRED THOUSAND ON AN ANNUAL BASIS NEXT FISCAL YEAR. SO IN THAT SITUATION, WHY DO IT NOW VERSUS WHEN WE DO THE BUDGET FOR NEXT YEAR SO WE CAN SEE HOW THE WHAT OUR INCOME IS IN RELATIONSHIP TO MORE EXPENSE? I THINK I'D LIKE TO BRING BACK CHIEF SO THAT HE CAN.

BETTER EXPLAIN THE NEED FOR THE REQUEST NOW VERSUS THE BUDGET, BUT THANK YOU FOR THE QUESTION, MAYOR. YEAH, THANKS, MAYOR I DEFINITELY APPRECIATE THE QUESTION.

IF YOU LOOK AT THE WAY THINGS ARE TRACKING FOR US NOW, THERE ARE SOME THINGS WHERE THE COMMUNITY HEALTH NURSE IN A PERFECT WORLD WOULD THAT POSITION COULD WAIT UNTIL JULY.

HOWEVER, WHEN YOU LOOK AT THE THINGS THAT ARE HAPPENING IN THE COVID FRONT AND THE DIFFERENT DEPARTMENTS THAT ARE MAKING UP THE COVID TASK FORCE, THAT THE DECISIONS THAT ARE BEING MADE, MEDICAL DECISIONS THAT ARE BEING MADE BY EMTS, PARAMEDICS, HR STAFF, RISK MANAGEMENT, THEY'RE REALLY WE REALLY COULD USE THAT HIGHER MEDICAL AUTHORITY IN MAKING SOME OF THOSE DECISIONS IN THE SHORT TERM.

THIS PANDEMIC WILL GO AWAY.

IT'S NOT GOING TO GO AWAY TOMORROW, BUT IT WILL GO AWAY.

AND HAVING THAT, THAT ASSISTANCE RIGHT NOW WOULD BE EXTREMELY HELPFUL RATHER THAN HAVING IT IN JULY.

NOW, IF YOU GO BACK A LITTLE BIT MORE THAN A DECADE WHEN FORMER CITY MANAGER KEVIN CRAWFORD WAS THE FIRE CHIEF, WE STARTED EXPLORING THIS COMMUNITY HEALTH OPTION CALLED COMMUNITY PARA MEDICINE BACK THEN, ALSO KNOWN AS MOBILE INTEGRATED HEALTH CARE.

AND WE WERE TAKING STEPS AND WE WERE ONE OF THIRTEEN AGENCIES THAT WERE INVOLVED IN A STATEWIDE PILOT PROGRAM TO GET THIS STARTED.

BACK THEN, THE INFORMATION CAME BACK AND IT KIND OF FELL ON THE HEELS AT THE STATE OF CALIFORNIA, AND WE WEREN'T REALLY SURE IF IT WAS GOING TO HAPPEN.

THE PANDEMIC, ACTUALLY KICKED ALL THE DUST OFF OF THAT, STARTED TO EXPEDITE IT, AND IN THE STATE OF CALIFORNIA, NOT CUTTING EDGE, DEFINITELY NOT BLEEDING EDGE, THERE ARE OTHER STATES IN THE COUNTRY THAT ARE USING MOBILE INTEGRATED HEALTH CARE AND COMMUNITY PARA MEDICINE. BUT THE PANDEMIC REALLY DUSTED IT OFF, AND NOW THE STATE'S MOVING FORWARD ON IT. THE COUNTY HAS MADE A COMMITMENT TO IT, AND THEY'RE MOVING FORWARD WITH THIS AND WITH THE VACCINATIONS AND EVEN JUST FLU SHOTS AND SOME OF THE OTHER HEALTH NEEDS AND WITH THE HOMELESS AND TRYING TO BRIDGE THE HOMELESS COMMUNITY, THEY'RE USING NURSES AND CLINICIANS, SOCIAL WORKERS TO TRY AND BRIDGE THIS GAP.

SO THIS WASN'T ANYTHING THAT I ANTICIPATED HAPPENING THIS QUICKLY.

BUT THE NEED HAS DEFINITELY BEEN THERE FOR THE LAST COUPLE OF MONTHS TO HAVE THAT HIGHER

[01:40:01]

MEDICAL AUTHORITY ON MANY FRONTS ACROSS OUR CITY WITH MANY DEPARTMENTS.

AND THIS POSITION WOULD KIND OF WOULD BRIDGE THOSE THINGS ALMOST IMMEDIATELY ONCE THEY'RE ON BOARD. SO I TOTALLY APPRECIATE EVERYTHING YOU SAID.

MR. CALDERWOOD, BUT I THINK IT'S THE REAL QUESTION IS TO MR. CHADWICK OVER THE LAST TWO BUDGET CYCLES OUR FTE COUNT IS UP ALMOST FIFTY PEOPLE AND IT KEEPS CREEPING FORWARD.

AND WHAT CONCERNS ME IS OUR REVENUE STREAM AND BEING ABLE TO MEET EVERY SINGLE DEMAND IS, YOU KNOW, THERE'S ONE DEMAND AFTER ANOTHER FOR FOR DIFFERENT PERSONNEL AT SOME POINT IN TIME. I DON'T KNOW THAT OUR REVENUE STREAMS ARE GOING TO MATCH, SO THAT'S CONCERNING TO ME, ESPECIALLY WHEN WE LOOK TO THE FUTURE.

AND WE JUST HAD A PRIOR CONVERSATION ABOUT THAT A FEW MINUTES EARLIER.

SO. AND MAYOR, I COMPLETELY UNDERSTAND AND CAN APPRECIATE THAT THERE CONTINUE TO BE NEEDS THAT AND I THINK AS OUR STAFF HAVE INDICATED, MOST OF THE POSITION ADS THAT HAVE OCCURRED HAVE BEEN AS A DIRECT RESULT OF COUNCIL'S DESIRES ON THEIR PRIORITIES.

SO WE ARE TRYING TO ADDRESS THOSE PRIORITIES.

HAVING WE DID NOT ANTICIPATE COVID.

NOW A LOT OF ORGANIZATIONS ACTUALLY HIRED COVID TASK FORCE TEAMS WHERE THEY ENDED UP BUFFING OUT. WHAT WE'VE BEEN DOING IS CONTINUING TO MAKE THE MOST OF THIS SITUATION, AND WE HAVE MULTIPLE EMPLOYEES PULLING DOUBLE DUTY.

SO IF YOU LOOK AT OUR ENTIRE HR STAFF, IF YOU LOOK AT STAFF MEMBERS THAT ARE ACROSS THE ORGANIZATION THAT ARE PART OF OUR COVID TASK FORCE, THEY'RE PULLING DOUBLE DUTY.

THEY'RE RESPONDING ON WEEKENDS.

THEY'RE PERFORMING WORK IN FUNCTIONS THAT ARE NOT TYPICALLY INCLUDED WITHIN THEIR EXISTING DUTIES OR RESPONSIBILITIES.

SO THERE HAS BEEN A NEED, THERE'S BEEN A NEED FOR WERE GOING ON.

I THINK WHAT IS AT MARCH WILL BE THE BEGINNING OF YEAR THREE AND AGAIN, WE DO NOT SEE AN END THAT'S GOING TO TRULY GIVE THOSE FOLKS A BREAK.

SO BY BEING ABLE TO BRING SOMEBODY ON NOW AND THEN ALSO BE ABLE TO DO AS THE CHIEF JUST DISCUSSED, I THINK THIS IS GOING TO BE AN INVALUABLE EXPERIENCE FOR BOTH THE PUBLIC, BUT ALSO OUR WORKFORCE.

AND JUST AS AN OBSERVATION, ALMOST EVERY OTHER CITY IN THE COUNTY HAS ACTUALLY HAD TO LET PEOPLE GO DURING THE COVID EXPERIENCE.

AND WE'VE BEEN VERY FORTUNATE BECAUSE OF HOW TIGHT WE RUN OUR SHIP.

AND AGAIN, I WANT TO BRING NOTICE AND IT'S TO THE COUNCIL.

WE'VE WE'VE AUTHORIZED THESE ALMOST FIFTY PEOPLE IN OUR REVENUE STREAM IN THE VERY NEAR FUTURE. IT'S NOT GOING TO BE ABLE TO SUPPORT THIS.

SO I JUST AND THIS IS A TOUGH ONE TO HAVE THE CONVERSATION ON BECAUSE IT IS A WELL-NEEDED POSITION. BUT AT SOME POINT IN TIME, WE CAN'T JUST KEEP ADDING PERSONNEL ON TOP OF PERSONNEL OR IT'S SOMEWHERE SOMEONE'S GOING TO HAVE TO HAPPEN.

SO DO YOU HAVE A REVENUE STREAM TO CHARTER ON OUR REVENUE STREAMS AND WHEN THEY CROSS? AND WHAT WAS IT, TWO OR THREE YEARS? AND I BELIEVE MS. ROCHA HAS THAT AND THEN ADDITIONALLY, WE'RE ALSO WE'VE COMMISSIONED A REVENUE STUDY, AND THAT WAS IN THE LAST BUDGET CYCLE THAT CITY COUNCIL APPROVED THAT.

AND I THINK IN THE STRATEGIC PLANNING SESSION THAT WE HAD IN DECEMBER, WE INDICATED THAT WE WERE GOING TO BE MOVING FORWARD ON THAT.

BUT THAT SAID, I WILL TURN IT OVER TO LAURA TO RESPOND TO WHERE THE CROSS THE INTERSECTION IS OCCURRING.

YEAH. AGAIN, WE WHEN WE PUT THE TEN YEAR FORECAST TOGETHER A COUPLE OF MONTHS AGO, AGAIN, WE'RE IN THE PROCESS OF DOING THAT FOR CITY COUNCIL AGAIN IN PREPARATION FOR THIS BUDGET CYCLE. WE WERE LOOKING AT AROUND 24-25.

AGAIN, THAT IS WHAT WE KNEW, YOU KNOW, MONTHS AGO.

AS YOU KNOW, FORECASTS ARE A POINT IN TIME AND WE LEARN MORE DATA AND WE, YOU KNOW, STRATEGIZE, I THINK, YOU KNOW, TO COMMEND CARLSBAD AND CITY COUNCIL.

I THINK ONE OF THE GREATEST THINGS WE'VE ALWAYS DONE IS TO DEVELOP THAT TEN YEAR FORECAST BECAUSE IT HASN'T BEEN THAT THERE'S ALWAYS BEEN A REVENUE LINE THAT HAS ALWAYS SUCCEEDED THE EXPENSES.

THERE'S BEEN TIMES AND IN IN IN THE PAST AS I'VE, YOU KNOW, JOURNEY BACK THROUGH SOME OF THE TEN YEAR FORECAST WHERE THOSE HAVE CROSSED.

AND THOSE WERE THE TIMES WHERE STAFF CAME TO CITY COUNCIL WITH STRATEGIES AND WAYS TO LOOK AT, OK, WE WE POTENTIALLY MAY HAVE THIS ISSUE IN A COUPLE OF YEARS.

WHAT WHAT THESE ARE, THE THINGS THAT WE NEED TO START THINKING ABOUT.

AND SO THOSE CONVERSATIONS ARE VERY HELPFUL AROUND UNDERSTANDING OUR TEN YEAR FORECAST

[01:45:02]

AND HAVING THAT INFORMATION AVAILABLE TO US.

SO LIKE I SAID, WE DO STAY ON TOP OF THAT.

WE WILL BE PRESENTING THAT TO CITY COUNCIL AND WE DO LOOK OUT WHEN WE, YOU KNOW, LOOK AT THESE DIFFERENT MEASURES. IT'S NOT UNUSUAL FOR US TO EVEN CONSIDER POSITIONS DURING MID-YEAR. WE DO ONLY CONSIDER MID-YEAR OR FULL TIME REQUESTS AT AT THE TIME OF BUDGET SO THAT ALL OF THIS CAN BE PRESENTED AND AND LOOKED AT IN THE LONG TERM AS WELL.

SO AGAIN, THIS WAS AN URGENT NEED, BUT AT THIS POINT, THAT'S THAT'S WHERE WE'RE SEEING ACROSS THE LINE. NOW I ALSO WANT TO ADD WE ARE ENGAGED.

WE'VE DONE THE BUDGET KICK OFF FOR THIS NEXT FISCAL YEAR.

AND NOW ONE OF THE THINGS THAT WE'VE ALSO REQUESTED FOR ALL OUR OPERATIONAL DEPARTMENTS TO DO IS SUBMIT A TWO PERCENT CUT LIST BECAUSE AGAIN, WE ARE LOOKING TO BE ABLE TO ACHIEVE WHATEVER SAVINGS WE POSSIBLY CAN SO THAT WE WE RECOGNIZE THAT GROWING THE BUDGET IS ALWAYS A CONCERN BOTH FOR ELECTED OFFICIALS, BUT THEN OFTEN ALSO FOR OPERATIONAL PERSONNEL. SO WE'RE VERY SENSITIVE TO THAT.

BUT WE ARE ALSO VERY SENSITIVE TO THE MISSION AT HAND AND THE TASK AT HAND.

SO WE'RE GOING TO CONTINUE TO DELIVER.

WE'RE GOING TO CONTINUE TO BE AS FISCALLY CONSERVATIVE AS WE CAN.

AND THAT'S ALSO WHY WE'VE REQUESTED AGAIN ALL DEPARTMENTS SUBMITTED TWO PERCENT CUT LESS THAT WILL BE FACTORING INTO THE BUDGET.

AND I GUESS MY FINAL COMMENT, MR. CHADWICK IS IS GIVEN WHERE THE STATE OF THE ECONOMY IS AND THE RUNAWAY INFLATION.

THOSE LINES ARE GOING TO CROSS A LOT SOONER THAN WHAT WE THOUGHT THEY WOULD SO.

UNDERSTOOD. ANY OTHER COMMENTS? COMMISSIONER NORBY. THANK YOU, MAYOR.

I JUST WANT TO KIND OF OFFER FROM MY TWENTY PERCENT MY PERSPECTIVE AND I'LL USE THE ANALOGY OF A BOAT.

AND CARLSBAD HAS BEEN VERY, VERY FORTUNATE FOR THE REASONS MENTIONED THAT WE HAVE A BOAT THAT RIDES REALLY, REALLY HIGH ON THE WATER.

AND THAT MEANS THAT EVERY LITTLE WAVE THAT COMES NOW AND THEN IT'S NOT GOING TO TIP US OVER. IF WE WERE LYING RIDING LOW ON THE WATER, SOMETHING HAPPENS AND WE'RE IN TROUBLE AND WE'RE RIDING VERY HIGH ON THE WATER.

AND I'VE MADE MY COMMENTS BEFORE ABOUT WHEN WE ARE IN A SITUATION LIKE WE ARE WITH COVID AND STILL IN IT. AND THIS IS A REACTION TO THAT, THAT WE SHOULD FLEX TO MEET THAT DEMAND.

WHATEVER THE IMPACTS ARE TO THIS COMMUNITY, WE HAVE THE RESOURCES TO FLEX TO MEET THAT DEMAND. AND I BELIEVE THAT'S WHAT WHAT'S GOING ON HERE.

YOU KNOW, I TRUST FUTURE COUNCILS TO GUIDE THIS CITY WELL, WHEN WE HAVE SOMETHING THAT IS JUST STRUCTURALLY WRONG AND STARTS TAKING US IN A DIFFERENT DIRECTION VERSUS HAVING THIS BOAT THAT RIDES HIGH IN THE WATER AND DOES VERY WELL.

BUT NONETHELESS, THAT'S WHERE WE ARE IN A VERY STRONG CITY, AND I DO BELIEVE THAT WE SHOULD FLEX AND I BELIEVE THE ITEMS THAT HAVE COME FORWARD TO US TODAY TO BE VERY MODEST AND MINOR. BUT I DO HEAR YOUR POINT ABOUT HAVING FIFTY NEW FULL TIME EMPLOYEES, AND WE'LL ADDRESS THAT. SO OR WE NEED TO ADDRESS THAT.

SO I LOOK FORWARD TO MORE INFORMATION COMING TO US DURING OUR BUDGET CYCLE.

BUT RIGHT NOW, I SUPPORT THESE.

OK, ANY OTHER COMMENT? COMMISSIONER BLACKBURN READY TO MAKE THE MOTION IF YOU ARE.

OK, I JUST WANT TO MAKE ONE QUICK FINAL COMMENT IS I CAN REMEMBER 08, 09, 10.

IT WAS A DIFFERENT DAY AND DIFFERENT ISSUE, BUT IT WAS A DOWNTURN IN THE ECONOMY IN WHERE THIS CITY, ALL OF US PULLED TOGETHER AND MADE IT THROUGH THOSE TWO YEARS WITH ACTUALLY SEVENTY FIVE LESS PEOPLE AND NEVER MISSED A DAY, NEVER CLOSED A DOOR.

NEVER LET ANYBODY GO.

BUT OUR OUR OUR ABILITY TO KEEP THE QUALITY OF OUR WHAT, WHO WE ARE AND WHAT WE DO WAS JUST AS WELL AT THE END OF THAT TIME AS IT WAS WHEN WE WENT INTO IT.

SO SOMETIMES THERE ARE HARD TIMES AND SOMETIMES WE GOT TO MAKE TOUGH DECISIONS IN WHAT'S WHAT WE HAVE TODAY IS WE'RE SEEING THE FUTURE IN 08, 09, 10, THAT HAPPENED REAL QUICK.

AND WE'RE HERE TODAY.

WE GOT A CHANCE TO PLAN FOR IT.

AND I JUST WANT US TO BE AWARE OF THAT.

IT'S THAT WE NEED TO REALLY THINK ABOUT THE FUTURE AND WHERE WE'RE GOING.

GO AHEAD, MR. BLACKBURN.

THANK YOU. MOVE ADOPTION OF BOTH RESOLUTIONS CONTAINED AN AGENDA ITEM NUMBER EIGHT.

SECOND. PLEASE CALL ROLL.

[01:50:04]

COUNCIL MEMBER NORBY, AYE.

COUNCIL MEMBER ACOSTA, AYE.

COUNCIL MEMBER BHAT-PATEL, AYE.

MAYOR PRO TEM BLACKBURN, AYE.

MAYOR HALL, AYE.

PASSES UNANIMOUSLY MOVING ON TO ITEM NINE.

[9. CONSIDERATION OF APPROVAL OF 2022 PRIMARY AND GENERAL ELECTION VOTE CENTER LOCATIONS]

UM, CONSIDERATION OF APPROVAL OF 2022 PRIMARY AND GENERAL ELECTION VOTE CENTER LOCATIONS.

IN MAKING OUR PRESENTATION TODAY IS OUR VERY OWN CITY CLERK, SERVICES MANAGER, FAVIOLA MEDINA. [INAUDIBLE]. THANK YOU, MR. CITY MANAGER. GOOD AFTERNOON, MAYOR AND CITY COUNCIL MEMBERS.

THIS ITEM IS BEING BROUGHT FORWARD TO YOU TODAY TO AUTHORIZE THE USE OF THE CALAVERA HILLS COMMUNITY CENTER ACTIVITY ROOM AND PINE AVENUE COMMUNITY CENTER GYM AS VOTE CENTER LOCATIONS FOR THE JUNE PRIMARY ELECTION.

THE BOARD OF SUPERVISORS RECENTLY VOTED TO TRANSITION TO THE VOTERS CHOICE ACT MODEL FOR ELECTIONS. AS SUCH, TWO VOTE CENTER LOCATIONS ARE BEING REQUESTED FROM THE CITY OF CARLSBAD FOR ELEVEN CONSECUTIVE DAYS FOR THE JUNE PRIMARY AND NOVEMBER GENERAL ELECTIONS.

THE REGISTRAR OF VOTERS OFFICE HAS IDENTIFIED LOCATIONS ALL OVER THE CITY, INCLUDING SOUTH CARLSBAD. HOWEVER, THEY HAVE ONLY ASKED THE CITY FOR THESE TWO CITY OWNED LOCATIONS AS THEY HAVE IDENTIFIED SITES OPERATED BY OTHER ENTITIES IN THE SOUTHERN PART OF THE CITY. ALTHOUGH THE ELECTIONS CODE REQUIRES THE LEGISLATIVE BODIES APPROVAL OF THE REQUEST, THERE IS A MECHANISM FOR THE REQUEST TO BE DENIED.

STAFF ACKNOWLEDGES THERE MAY BE A FISCAL IMPACT TO THE PARKS AND RECREATION DEPARTMENT FOR PROGRAMING DURING THIS TIME.

HOWEVER, THE AMOUNT IS UNKNOWN AT THIS POINT DUE TO THE NATURE OF THE REQUEST.

IN ADDITION, WE'RE HOPING THAT WITH THIS MUCH ADVANCE NOTICE.

PARKS AND RECREATION MAY IDENTIFY ALTERNATIVE LOCATIONS FOR ANY PROGRAMING SCHEDULE DURING THOSE ELEVEN DAYS.

STAFF IS AVAILABLE TO ANSWER ANY QUESTIONS YOU MAY HAVE.

DO YOU HAVE ANY SPEAKERS ON THIS ITEM? AT THIS TIME, I WOULD LIKE TO ASK THOSE WISHING TO SPEAK ON ITEM NUMBER NINE TO PLEASE RAISE YOUR HAND VIRTUALLY IF YOU'RE USING THE MEETING LINK TO LOG IN OR IF YOU'RE JOINING US BY PHONE, PLEASE PRESS STAR NINE NOW TO RAISE YOUR HAND.

WHEN I CALL YOUR NAME OR LAST THREE DIGITS OF YOUR PHONE NUMBER, PLEASE PRESS STAR SIX TO UNMUTE. YOU WILL HAVE THREE MINUTES TO MAKE YOUR COMMENTS.

YOU WILL BE MUTED ONCE YOUR THREE MINUTES HAVE CONCLUDED.

ONCE AGAIN, PLEASE RAISE YOUR HAND OR PRESS STAR NINE NOW.

WE DO NOT HAVE ANY SPEAKERS, MAYOR.

OK ANY COMMENTS? UM, MR. BLACKBURN A MOTION.

MOVE ADOPTION OF THE RESOLUTION CONTAINED IN AGENDA ITEM NUMBER NINE, SECOND.

PLEASE CALL ROLL.

COUNCIL MEMBER NORBY, AYE.

COUNCIL MEMBER ACOSTA, AYE.

COUNCIL MEMBER BHAT-PATEL, AYE.

MAYOR PRO TEM BLACKBURN, AYE.

MAYOR HALL, AYE.

ITEM NINE PASSES UNANIMOUSLY GOING ON TO ANY COUNCIL REPORTS.

MR. MAYOR, I APOLOGIZE.

[8. ECONOMIC AND FINANCIAL UPDATE FOR THE SECOND QUARTER OF FISCAL YEAR 2021-22 AND MID-YEAR REVIEW WITH STAFFING AND OTHER FUNDING REQUESTS (Part 2 of 2)]

I NEED TO TAKE YOU BACK TO ITEM EIGHT AND PLEASE FORGIVE ME.

BUT WE PASSED TWO RESOLUTIONS AND ONE OF THOSE RESOLUTIONS HAD THREE BLANKS.

I'M ASSUMING YOU WANTED TO FILL THOSE THREE BLANKS WITH THE THREE FULL TIME POSITIONS THAT WERE UNDER DISCUSSION, BUT IT WASN'T INCLUDED IN THE MOTION AND I'D LIKE TO GO BACK AND FILL IN THOSE BLANKS, IF WE MAY.

I WOULDN'T WANT TO HAVE A LEGISLATIVE RECORD THAT SAID, WE ADOPTED A RESOLUTION WITHOUT FILLING IN THOSE BLANKS.

OK, SO YOU WANT US TO REVOTE ON THAT ITEM? YES. AND I'D JUST LIKE YOU TO CLARIFY, I'M ASSUMING THAT THOSE THREE BLANKS OR THE THREE, THE THREE POSITIONS, THE COMMUNICATIONS, THE FIRE AND THE I'M SORRY, SAY THE ONE.

AND THAT'S THAT'S HOW I UNDERSTOOD THE MOTION MAKER.

OK, I'LL MAKE THE MOTION AGAIN.

MOVE ADOPTION OF BOTH RESOLUTIONS WITH STAFF RECOMMENDATIONS FOR AGENDA ITEM NUMBER EIGHT. OK, SO THAT INCLUDES THE POSITION IN FIRE, THE POSITION IN COMMUNICATIONS, AND THE POSITION IN LIBRARIES, WANTED TO CLARIFY THAT, THANK YOU VERY MUCH.

THANK YOU VERY MUCH AND THANK YOU FOR RE VOTING COUNCIL.

[INAUDIBLE] CALL THE QUESTION.

COUNCIL MEMBER NORBY, AYE.

COUNCIL MEMBER ACOSTA, AYE.