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Speaker 1: Mr.
Speaker 1: Chairman.
Speaker 2: OK, thank you.
Speaker 2: The first item is approval of the agenda and I would like to move the health insurance renewal presentation to 8A and the budget update to 8B so that we can spend more time on the budget update hopefully than the insurance.
Speaker 2: So I would propose that amendment to the agenda.
Speaker 2: Are there any other changes from staff Miss McCoy?
Speaker 3: No changes, Mr.
Speaker 3: Chair.
Speaker 2: OK.
Speaker 2: Can I have a motion with that amendment as proposed move?
Speaker 4: To approve as amended Second.
Speaker 5: Councillor Beta, you're now host of the meeting.
Speaker 5: OK.
Speaker 2: OK.
Speaker 2: Thank you.
Speaker 2: OK.
Speaker 6: I'll 2nd.
Speaker 6: I'll second the motion, Mr.
Speaker 6: Chair.
Speaker 2: OK, we have a motion by Councilwoman Villarreal and a second by Councilwoman to Romero Works.
Speaker 2: All those in favor say aye.
Speaker 2: Or do we need to do a a?
Speaker 1: Roll call.
Speaker 1: Yes Sir, we have to do a roll call vote.
Speaker 2: On.
Speaker 1: Everything.
Speaker 1: I'm sorry, Councillor Romanabeta.
Speaker 2: Yes.
Speaker 1: Councillor Signi Lindell, Yes.
Speaker 1: Councillor Carroll Romero Wirth, Yes.
Speaker 1: Councillor Renee Villarreal Yes.
Speaker 1: Councillor Jamie Cassette Sanchez Yes.
Speaker 1: Motion passes.
Speaker 2: OK.
Speaker 2: Our next item then is approval of the consent agenda.
Speaker 2: Are there any items that we're going to pull from consent to be discussed?
Speaker 2: Is there a motion to approve the consent agenda?
Speaker 4: Move to approve second.
Speaker 2: OK, we have a motion by Councilwoman Lindell and a second by Councilwoman Villarreal.
Speaker 2: Can I have a roll call please?
Speaker 1: Yes, Sir, Councillor Mana Beta.
Speaker 2: Yes.
Speaker 1: Councillor Signal Lindell.
Speaker 7: Yeah.
Speaker 1: Councillor Romero Werth or Carol Romero Werth.
Speaker 6: Yes.
Speaker 1: Councillor Renee Villarreal.
Speaker 4: Yes.
Speaker 1: Councillor Jamie Casette Sanchez Yes, motion passes.
Speaker 2: OK.
Speaker 2: That moves us to approval of the minutes, the regular Finance Committee minutes of March 30th, 2020.
Speaker 2: Are there any changes from staff?
Speaker 3: No changes from staff, Mr.
Speaker 3: Chair.
Speaker 2: OK.
Speaker 2: Are there any changes from the committee?
Speaker 2: Is there a motion?
Speaker 8: Move to.
Speaker 4: Approve second.
Speaker 2: OK, we have a motion and a second.
Speaker 2: Can I have a roll call please?
Speaker 1: Chair Roman Romana Beta.
Speaker 2: Yes.
Speaker 1: Councillor Signe Lindell.
Speaker 7: Yes.
Speaker 1: Council Councillor Carol Romero Wirth Yes.
Speaker 1: Councillor Renee Villarreal, Yes.
Speaker 1: Councillor Jamie Costa Sanchez Yes.
Speaker 1: Motion passes.
Speaker 2: OK.
Speaker 2: So then that will bring us to our presentation and recommendations.
Speaker 2: We will first have a presentation on the City of Santa Fe Health Insurance renewal Aon Consulting.
Speaker 1: Mr.
Speaker 1: Chairman, can I get a spelling of Aon, please?
Speaker 2: Capital A, then small letter O and small letter NAON.
Speaker 1: OK.
Speaker 1: And may I ask for the for the presentation to be emailed to me please?
Speaker 2: Yes, we will do that.
Speaker 1: Thank.
Speaker 1: Thank you.
Speaker 2: OK, I believe.
Speaker 2: Miss Mintanya, will you be making the presentation?
Speaker 9: Yes, I'll take the lead.
Speaker 9: And then I've got Todd Burley Elizabeth.
Speaker 9: His last name spelling is Burley.
Speaker 4: Thank you.
Speaker 9: That was Todd.
Speaker 9: He is our senior financial manager in our office and he will probably help to address a few of the slides.
Speaker 9: So everyone who has the the presentation, I'm going to begin on slide 3.
Speaker 9: This is just an overview of the summary.
Speaker 9: You know the the ask is to renew your contract with Cigna.
Speaker 9: Your as a reminder you are a self funded program and as such your medical renewal has three pieces.
Speaker 9: You have your administrative costs that you pay Cigna to administer your plan, provide customer service, pay your claims and then you have the stop loss piece.
Speaker 9: This is the insurance to protect the city against any large claims or an excess amount of claims.
Speaker 9: And then you have the money you set aside to pay for claims as a self funded program.
Speaker 9: So your administrative costs are go are a 5.8% increase, the stop loss is a 9% increase.
Speaker 9: And then overall with what we projected for claims increase, we're looking at an overall 9.4% increase.
Speaker 9: We'll go into a little bit more in depth into these numbers.
Speaker 9: Your dental program is also self funded.
Speaker 9: The that plan is running really well.
Speaker 9: So at this time we're recommending no change in the funding to that program.
Speaker 9: If we move to slide 4, this gives you an overview of the cost.
Speaker 9: Now this is the total cost of your program.
Speaker 9: So this includes what the city of Santa Fe contributes towards the cost and what the employees also contribute if they are contributing to any of the programs through their payroll deductions.
Speaker 9: So you can see in line 2 we have your medical program cost in column B.
Speaker 9: This is the estimated current cost for the 2019-2020 plan year.
Speaker 9: Column C would be the total projected cost for the 20/20/21 plan year.
Speaker 9: Column D shows the percent difference and column E is the dollar amount difference between what you're currently paying per year to what it would go up to.
Speaker 4: Mr.
Speaker 4: Chair and done.
Speaker 4: Just curious if you could share the screen as to what you're talking about if possible so that online YouTube folks will know what you're referring to since it is a public document.
Speaker 9: Sure, let me select my screen to share.
Speaker 6: Don, can I ask 2 questions, Mr.
Speaker 6: Chair?
Speaker 2: Yes, go ahead, Councilwoman Romero Ward.
Speaker 6: So I assume that this is the cost of renewal with the plan as it is.
Speaker 6: This is without making any changes that are selected late that are outlined later, correct?
Speaker 9: That is correct.
Speaker 6: And then also this is these, the cost of renewal is current and is there any notion that it might change or between now and when we actually renew?
Speaker 9: No, we went through and did it.
Speaker 9: We went back through, looked at your claims to update everything with more current claims information.
Speaker 9: And so we don't expect any changes from what we're presenting today.
Speaker 6: OK.
Speaker 6: Thank you, Mr.
Speaker 6: Chair.
Speaker 2: OK.
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 2: Yes.
Speaker 4: Council is to ask questions as we go through the slides or at the end or if we have questions on a specific slide.
Speaker 4: What's the?
Speaker 2: I I think let's ask on a specific slide.
Speaker 2: So yeah, but I can't see everybody.
Speaker 2: So just like you've been doing just.
Speaker 4: OK.
Speaker 4: I know, John, I know you're trying to find the view out there.
Speaker 4: That looks great.
Speaker 4: I do have a question on stop loss, but I'll wait till you get to that section.
Speaker 4: Thank.
Speaker 9: You OK, so when this first row is your total medical plan cost, so it contains your fixed cost, your stopwatch insurance cost and then the amount of money you're putting aside to pay claims.
Speaker 9: CNC current spend is roughly 20 million, a little over 20 million projected to to go up to 21 million, 937.
Speaker 9: So it's a 9.4% increase of and it's a difference of 1.8 million, almost 1.9 million in the blue we broke out.
Speaker 9: So you could see the difference between what is going towards your fixed class, which includes the administrative cost that you paid a Cigna and your stop loss and then what you're putting aside for funding to pay towards claims.
Speaker 9: So you can see that make up row 5 is your dental cost.
Speaker 9: Again, we projected the plan is running really well.
Speaker 9: We actually are projecting costs to be down.
Speaker 9: So we're we're recommending that you make no changes to your funding.
Speaker 9: So that way you're able to contribute to your reserve, your life insurance.
Speaker 9: There is when you see these numbers here, you're going to see a big, a pretty big percentage increase.
Speaker 9: But what we did is in working with the HR team is look at a benefit change and a a structural change compared to what you're doing with your life insurance today.
Speaker 9: I have in a later slide, I have more information about that.
Speaker 9: So we'll hang on to that thought and we'll get back to it when we get to that slide.
Speaker 9: And then your dependent life.
Speaker 9: Then beginning on row 10 through 14.
Speaker 9: These are all voluntary programs.
Speaker 9: So these are programs where the employees pay 100% of these premiums.
Speaker 9: The vision is having a slight increase of 3%.
Speaker 9: It's a annual difference of $5657.
Speaker 9: So just a couple of notes on the on the fees is Cigna was willing to put in a rate guarantee on their fixed cost that they charge for administering your dental and your medical plans.
Speaker 9: There is for 2020, there's no increase, but for 2021 and 2022 their guarantee it will not exceed more than 2%.
Speaker 9: That's just for their administrative costs.
Speaker 9: The stop loss, you have a 9% increase on those costs and your current individual stop loss pulling level is $250,000.
Speaker 9: So as a reminder, stop loss, the individual stop loss is what you purchase to protect you against large claimants.
Speaker 9: So the city is responsible for the 1st $250,000 in paid claims for any member covered by your plan.
Speaker 9: If their claims exceed $250,000, that's where the stop loss is going to pick up the amount in excess of of that $250,000.
Speaker 4: You answered my question.
Speaker 4: Thank you.
Speaker 9: OK, perfect.
Speaker 9: This slide, not going to spend a lot of time unless there's questions, but just wanted to on Slide 5 give you an overview of your renewal history back to 2012.
Speaker 9: You can see year over year how the renewal has gone for each of your programs.
Speaker 9: The bottom row is a composite and average over the information shown.
Speaker 9: And then I think what's important to look at these numbers is against the things nationally to see how you've done.
Speaker 9: So you can see some years you've been a little bit higher than trend, but there's been a lot of years when you've been below trend and the trends are based on Aeon's book of business and our national trend survey.
Speaker 9: Now, what are the questions since we're that we get asked a lot by the council is when we look at these medical and dental clock costs, because they are the most significant pieces of the of the benefits is how much is the city actually contributing towards those costs.
Speaker 9: So if you'll remember a couple slides back on the medical I had showed you that the costs were currently but a little over 20 million and going up to 21 million.
Speaker 9: When we calculate what the city is contributing into it and take out what the employees pieces, you can see currently the city is contributing about 15 million, 398 with the renewal that will go up to 16.849 million.
Speaker 9: So the the increase at 9% equates to 1.451 million and the dental since there's no increase, there's not an increase to your share, but the city's share of the dental program is $635,804.00 a year.
Speaker 9: So when we add those two together, that's where we get the 16,000,000.
Speaker 9: I'm currently going up to 17.485 million.
Speaker 9: Any questions on this?
Speaker 9: This is how we projected your renewal and Todd, if you want to talk some high levels through this and then I'll just I'll keep control of the slides slide deck.
Speaker 10: OK, that sounds good.
Speaker 10: Mr.
Speaker 10: Chair.
Speaker 10: Counselors, I'll walk through this quickly.
Speaker 10: I think everybody has seen this before, but if not, correct me.
Speaker 10: Essentially what I do is I take the past 20-4 months of claims.
Speaker 10: So you'll see in the very first row from April of 19 through March of 2020, there were $18.576 million in medical claims, two and a half, $1,000,000 in RX for a total of $21 million.
Speaker 10: There's a reimbursement of $800,000 for stop loss.
Speaker 10: Again, any claimant who exceeds $250,000, any amounts above that will be paid by Cigna.
Speaker 10: So net claims of $20.3 million or $1419.16 per employee per month annual trend.
Speaker 10: As you saw a couple slides ago, this comes from our trend survey, which survey is various carriers and internal and external data sources.
Speaker 10: So I'm trending medical costs at 5%, our exit 7%.
Speaker 10: They get trended to the midpoint of next year.
Speaker 10: Long story short, right before that red bar in the middle, projected claims based on this time period are 21.621 million.
Speaker 10: I performed the same exercise for the prior, make some adjustments in the very bottom right hand corner.
Speaker 10: I'm estimating claims for next year to be just under $20 million.
Speaker 10: This is just the claim piece.
Speaker 10: This does not include the fixed cost, the administration or the stop loss.
Speaker 10: Any questions on how I got there?
Speaker 10: I hope not because we've moved on.
Speaker 10: Next slide just adds in the administrative fee and the stop loss.
Speaker 10: As you can see, the admin fee is a little under 600,000 individual stop losses, 1.3 million aggregate stop loss, which we haven't talked about, but that protects the city.
Speaker 10: If claims are essentially more than 25% higher than expected, Cigna would pay anything above that amount.
Speaker 10: So I estimated claims about $20 million.
Speaker 10: If they for some reason exceeded roughly $25 million, Cigna would pick up any amount in total over that $25 million amount.
Speaker 10: Very rarely happens and even with COVID-19, doubt it will happen next year.
Speaker 10: So total costs are $21,937,000 and if you go down to the bottom section, all I do is take that 21.9 million and distribute it amongst the various plans and the union and non union rates that you currently have in place.
Speaker 10: Bottom right hand corner.
Speaker 10: That's the 9.4% increase that we've talked about previously.
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 2: Yes.
Speaker 11: And.
Speaker 4: I just wanted to can you remind me why the premium plan for union is higher than premium plan for non union again?
Speaker 10: Mr.
Speaker 10: Chair, Councillor Villarreal, they have richer benefits than the non union.
Speaker 10: A few years ago when when it was decided to reduce benefits on the premium plan, the unions did not agree to that, so they are still on a richer plan.
Speaker 4: OK.
Speaker 4: Thank you.
Speaker 12: Mr.
Speaker 12: Chairman, this is Burn.
Speaker 2: Yes.
Speaker 12: I would like to just clarify the the plan that Todd just spoke about that is solely for the fire union.
Speaker 12: All the rest of city employees are on the regular plan.
Speaker 2: OK.
Speaker 2: So the so it's the fire unions premium plan that's a little higher or richer than the other union and non union.
Speaker 4: Thank you for the clarification, Vern.
Speaker 12: No problem.
Speaker 12: That's correct.
Speaker 12: Thank you.
Speaker 4: And I'm having a hard time hearing Don, were you talking earlier?
Speaker 4: I don't.
Speaker 4: I can't hear it all.
Speaker 1: I can't.
Speaker 1: I can't hear her either.
Speaker 10: To me, I'll I'll I'll take it over while Don are we trying to fix this?
Speaker 10: So what you see in column A is the current if you think back of pays the current non union and ask me benefits, you can see there is no deductible.
Speaker 10: A $2500 out of pocket maximum for preventive services pays 100%.
Speaker 10: The PCP visit is $15.
Speaker 10: Specialist is 30 hospital inpatients 250, outpatients 150 lab and X-ray are 100%, CAT scans 100%, ER 125 and so on down the list.
Speaker 10: You can see that here's the fire plan and you can see it's even richer.
Speaker 10: Anything in red is a benefit that did not that we changed a few years ago for the at the time everyone except police and fire and now it's just fire.
Speaker 10: So anything, Chair?
Speaker 2: Yes.
Speaker 6: We don't have this slide in our packet correct.
Speaker 2: No, I don't believe we do.
Speaker 2: I don't.
Speaker 9: No, I, no, this was something I, I did not, we did not have in the packet, but I did send it over to Ashley with the HR team so we can get this distributed to you.
Speaker 9: I we just had it ready just in case there were specifics around the plan design for you.
Speaker 6: Yeah, we should probably have a copy.
Speaker 4: Yes.
Speaker 6: Thank you, Mr.
Speaker 12: We'll make sure that everyone gets it now.
Speaker 2: OK.
Speaker 2: So if we can go back to the presentation that we do have, that would be great.
Speaker 1: Mr.
Speaker 1: Chairman, if I could be included on the list, send for that, I'd appreciate it for the minute, the exhibits.
Speaker 2: OK.
Speaker 9: OK, can everyone hear me?
Speaker 2: Yes.
Speaker 7: OK.
Speaker 9: It muted me and I didn't realize it had.
Speaker 9: So slide 9 is showing you what the contributions will be.
Speaker 9: So this what we call reference as a non union plan.
Speaker 9: So this is really all the employees except for fire.
Speaker 9: This red side is what the current rates are set at and then the blue table is what they would be effective 2019.
Speaker 9: Again, this is current plan designs not accounting for any changes.
Speaker 9: So you can see this is your premium plan.
Speaker 9: Here you have 997 employees enrolled.
Speaker 9: The premium plan is showing rows one through 7.
Speaker 9: The budget rate is the like per month premium equivalent.
Speaker 9: Column D shows your employer cost.
Speaker 9: This is what the City of Santa Fe is contributing towards the cost.
Speaker 9: Column E is how much the employee is paying per month and column F is what the employee is paying per pay period.
Speaker 9: And when you shift to the right in the blue box is the same setup.
Speaker 9: The only difference is we have column M which is showing the per pay period change.
Speaker 9: So you can see when we look at the ploy only tier, they're paying $87.03 per pay period.
Speaker 9: Today, July 1st, this would go up to $95.22.
Speaker 9: So that's an increase of $8.19.
Speaker 9: And then that just follows down by each plan.
Speaker 9: The core plan you have beginning on row 8 through 14, there's 55 employees enrolled in that.
Speaker 9: And then your HRA plan beginning on row 15 through 21 is has 16 employees on that.
Speaker 9: Then row 22, what it does is it adds the total roles from each of your plan to give you your total cost.
Speaker 9: Any questions on this page?
Speaker 9: Then when we move to slide 10, this is the fire plan and same format.
Speaker 9: So you can see because their contributions, their costs are a little bit higher.
Speaker 9: You can see their per pay period changes are a little bit higher.
Speaker 9: Again, this does not take into account any plan design changes.
Speaker 9: Now slide 11, this is where the first slide where we wanted to talk about presenting some plan design changes.
Speaker 9: So Berna and her team had come to us and you know, we talked about plan designs many times in the past and then she came to us most recently with just some of the budget concerns and asked us to present some options for for you all to consider this option.
Speaker 9: What it would be doing is adding a deductible to your premium plan and it would be an individual deductible of $300 and a family deductible of $600 and then coinsurance at 10%.
Speaker 9: And what this means is that any time somebody accesses care, whether they have an overnight stay in the hospital and outpatient hospital service, which could include like a day surgery, your advanced radiology.
Speaker 9: So those are your Mris, CAT scans, PET scans and then your non preventive labs and radiologies.
Speaker 9: So how this would work is say somebody was having an outpatient surgery and they had not had any care so far in the year, they would be responsible for paying their deductible.
Speaker 9: When they've met their deductible for the year, that's all they pay for that.
Speaker 9: So an individual had a surgery, they would pay $300 then they would pay 10% up to their out of pocket maximum.
Speaker 9: And as a reminder, they're out of pocket maximum is 2500 for an individual and 5000 for family.
Speaker 9: Now with this.
Speaker 2: Excuse me Don and this this option.
Speaker 2: What's the 900,000 and the 4.6?
Speaker 9: Sure, Chairman Abaitha, what the what that represents is if we were to adopt these saving, these changes to your plan, these would be the savings.
Speaker 9: So it would take your 9.4% renewal increase and reduce it by 4.6% or it'd be roughly a $900,000 savings.
Speaker 2: Out of how much are is it increasing a million?
Speaker 2: What?
Speaker 10: Let me jump in real quick.
Speaker 10: That's $900,000 total, not the city share.
Speaker 2: So this.
Speaker 10: Would be the 76 1/2% of that the overall increase was a little less than 1.5 million to the city.
Speaker 10: So if you take 7% of that is roughly I should be able to do this 220 five 675,000.
Speaker 2: So it would be the other portion is the employee's portion and that's how we get to 100%.
Speaker 2: So so the employees would save money also.
Speaker 10: Well, the well the the employees would say Chairman and Beta the employees would save money in the contributions from their paychecks.
Speaker 2: OK.
Speaker 10: But that $900,000 savings is really shifting the cost to the employees at the time of service.
Speaker 10: So they would pay more to the hospitals, labs, X-rays for their services on the previous page.
Speaker 2: Yeah, those employees that needed it, correct.
Speaker 2: OK, OK.
Speaker 2: Thank you.
Speaker 9: Any other questions regarding this option?
Speaker 7: One quick question, Councillor Lindell here.
Speaker 7: Are you looking only at the one of the 900,000 or are you looking at also the 500,000?
Speaker 7: And both of those only apply to the premium plan.
Speaker 9: So Councillor Lindell, and so this is just looking at if we made this change, this one change to the premium plan on the this on slide 12, we provided another option.
Speaker 9: These two options don't add together.
Speaker 9: They're just one or the other.
Speaker 9: You choose one.
Speaker 9: You either choose option one on the on page 11 or this would be considered like option 2.
Speaker 10: And Mr.
Speaker 10: Chair Councillor Lindell, what I was trying to show with this, this is even with substantial increases to the various co-pays you have in place on on that richest plan right now, it's going to be difficult without implementing A deductible and coinsurance to see any significant savings.
Speaker 7: My question was, are these both only to the premium plan?
Speaker 10: Mr.
Speaker 10: Chair, Councillor Lindell, yes, and again, keep in mind over 90, close to 95% of your employees are on the premium plan.
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 2: Yes, Councilwoman Virayal.
Speaker 4: Miss Montano, just curious, you said that you can have either one or the other possible consideration changes, but not both.
Speaker 4: Can you say more about that?
Speaker 10: Did your chairman, abate, Councillor Villarreal, the If you look at the previous slide, the deductible and coinsurance applies to inpatient, outpatient, radiology and lab.
Speaker 10: If you go to the next slide, you'll see what I've shown is increasing the inpatient hospital co-pay.
Speaker 10: For example, from 2:50 to 1000, you can't have both a deductible and a co-pay on on a service.
Speaker 10: So really what I was trying to show with this slide is even increasing the inpatient hospital to $1000.
Speaker 10: The outpatient hospital from 1:50 to 2:50, it's the this, the city's plan at this point is at a point where in order to see a substantial amount of savings, we're going to have to replace some of these co-pays with a deductible and coinsurance.
Speaker 4: Thank you for that.
Speaker 4: I guess when I see these slides, it looks like you're doing both options possibilities and if someone were to see this, it might confuse them.
Speaker 4: So maybe there's a way to distinguish like option one and option 2 considerations?
Speaker 4: Because my first impression was that we would consider both.
Speaker 2: That's a good point, Councilwoman Villarreal.
Speaker 2: I agree.
Speaker 2: And I, I think what I would like to, I would like for the Finance Committee to make a recommendation to staff as to which, which option we would like them to pursue because I think there's a process that we have to go through with our unions.
Speaker 2: But I think given the environment that we're in and the presentation that we're going to hear next, I think this is something that we need to take a serious look at.
Speaker 9: Chair Betha and councillors, we appreciate that feedback and we make note of that and make sure to ensure that the presentation is clearly indicated, that there's separate options.
Speaker 2: OK, great.
Speaker 2: And then the the rest of the presentation, I see there's dental which is the same.
Speaker 2: I don't know if there's a need to go over that slide.
Speaker 2: Vision also doesn't look like there's a major change.
Speaker 2: There's some details and then and then the rest we get into there's appendix.
Speaker 2: So is there anything else that you think is important for us to to hear before I start discussion on the two options?
Speaker 9: Chairman Ametha and and counselors the, the one I would like to point out is the basic life and disability policy because we what is being proposed here is a benefit change.
Speaker 9: Currently today you offer a benefit at a flat $10,000 and the city of Santa Fe picks up 65% of the premium and the employee pays 35% to have that cost sharing structure on a life on a basic life and disability benefits.
Speaker 9: So what we're showing here in this top section is very unusual.
Speaker 9: And Berna and her team have worked through an audit.
Speaker 9: There's there's been some issues that have come up because of that cost sharing structure on how it applies to the voluntary coverages.
Speaker 9: One of the things that they've asked us to avoid these issues from a taxability standpoint with the IRS is to to look at restructuring the benefit so that way the city does not have any taxable liability from this.
Speaker 9: And So what we did is looked at increasing the benefit on the basic life benefit, and the city would pay 100% of that cost going forward.
Speaker 9: And then the employees would be responsible for paying 100% of the voluntary coverages, which is typically how a life insurance benefit is structured.
Speaker 9: And so that is why you're seeing a increase in the cost is #1 the city is picking up 100% of this basic life policy, but we've also enhanced the benefit slightly to match more in line of what we see with other employers.
Speaker 3: OK.
Speaker 2: OK, does that the presentation?
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 2: Yes.
Speaker 4: Council on that point about basic term life.
Speaker 4: So does that offer a savings for us or is that just changing the the formula if you will?
Speaker 4: It sounds like it's actually more expensive, but is there like a savings long term or something?
Speaker 9: Chairman Abaitha and councillors.
Speaker 9: So there is a savings, but I don't I don't have those numbers.
Speaker 9: The HR team will have those numbers because today these these bottom numbers down here where it says voluntary beginning on row eight in the current situation, you're also picking up 60, about 65% of those costs depending upon how much employees are paying.
Speaker 9: So the true picture which the HR team was pulling those records together of what you're paying a larger portion of this total of 440,000 we're going forward, you would not be paying any of that.
Speaker 9: That should totally be a voluntary benefit where the employees are picking up 100% of those costs and that's not what is happening today.
Speaker 9: So while it does look like you're seeing an increase to the city's share, in all actuality, when you stop contributing to the towards the voluntary coverages, your share will actually probably go down quite a bit.
Speaker 2: OK, Councilwoman Lindell, did you have a question?
Speaker 2: I see your hand is up.
Speaker 7: Thank you, Chair.
Speaker 7: The only thing I was asking was do you had a chart that showed that wasn't in our packet that showed what the maximums were?
Speaker 7: What when we're considering these increases, it was 2500 for an individual and 5000 for a family.
Speaker 7: Is that correct?
Speaker 9: Chairman Abeatha and Councillor Lindell, is this the slide you were referring to where it had the maximums on the plan to sign?
Speaker 2: I think it's slide 11 where we you talked about the deductibles compared to the co-pays, one of our options.
Speaker 7: Yeah.
Speaker 7: And and the slide she's showing right there is the one I am referring to because that shows what the maximum would be, which is really important.
Speaker 7: OK, thanks for putting that back up.
Speaker 7: I can only see on mine the union fire benchmark.
Speaker 7: What's the 4th column?
Speaker 9: So Chairman Abatha and Councillor Lindell, the 4th column I added in here was the state of New Mexico Benefit Designs.
Speaker 9: Just for you to be able to see how your plans compare to the state of New Mexico since they are a large employer within our state and probably a very, you know, someone who you compete with for your staff.
Speaker 9: And so just to see where your benefits align to theirs, the only thing that was not completed on this sheet, because I could not find it on their website, was how they if, if and how they cover medical massage.
Speaker 2: So, so 8 employees, their deductible right now is 500 to 1000 to 1500.
Speaker 9: Chairman Abaita Yes, that is correct.
Speaker 9: It's 500 for an individual, 1000 for employee plus one and then 1500 for family.
Speaker 2: And ours right now is 0.
Speaker 9: On yes, Sir, that is correct.
Speaker 9: On your premium plan, yes.
Speaker 2: OK.
Speaker 2: And then the family, it goes up to 4000, all the way up to 12,000.
Speaker 9: Chairman Abate the actually that row is the out of pocket Max.
Speaker 9: So that is the most the member would pay out of their pocket for their healthcare service.
Speaker 9: So that that is like their umbrella, their protection.
Speaker 9: So in the plan year they would pay no more on the state's plan 4000, where on your plan an individual pay no more than 2500.
Speaker 2: And is that so?
Speaker 2: Is that the slide 11, the deductible, that option, What does that look like?
Speaker 2: That's it.
Speaker 9: Chairman, So I did not spread it on here, but where what it would change is where you see none right here in column A on this deductible row.
Speaker 9: That would then be 300 and 600.
Speaker 9: The out of pocket maximum would not change.
Speaker 9: We're not proposing an increase to the out of pocket maximum.
Speaker 9: So the employees, the most they would pay out of pocket would stay the same.
Speaker 9: What would change then down below here is your outpatient surgery, your inpatient hospital.
Speaker 9: Those two would no longer be a co-pay.
Speaker 9: They'd be deductible and Co insurance.
Speaker 9: Your MRI, PET, CAT scans, and then your lab and X-rays.
Speaker 9: But it's only lab and X-rays that are not preventive because preventive lab and X-rays are 100%.
Speaker 2: So.
Speaker 2: So what would, would this option be closer to what government employees at the state have to have to do now?
Speaker 2: Or would we be, would it be, would it be comparable?
Speaker 2: Would it be better?
Speaker 2: Would it be, you know, more expensive for the employee than if they were working for the state?
Speaker 9: Chairman of Bethan counts other counselors.
Speaker 9: So it would still your plan would still be probably more considered better than the states because you would still have a lower deductible, you still have a lower out of pocket maximum.
Speaker 9: I can't speak to what they charge their employees.
Speaker 9: I know they are salary basement ranges to where they pay 60 to 80% based on the salary band.
Speaker 9: So you are definitely probably more generous especially for you know the difference salary levels.
Speaker 9: So I would still say even if you adopted the deductible and Co insurance, you'd still have a very generous benefit plan more.
Speaker 2: Than the states.
Speaker 10: Yeah, Chairman Abeita, yes, it's still it.
Speaker 10: It's going to be more rich than the state.
Speaker 10: If you compare the co-pays as well as the deductible and Co insurance that you'd have you can see your co-pays would remain lower than the state and also those salary based contributions any employee making for the state.
Speaker 10: I believe it's $50,000.
Speaker 10: It might be 60 pays 40%.
Speaker 10: Your employees are only paying 23.5%.
Speaker 2: And our employees will continue to only pay 23.5 even if we chose this deductible option.
Speaker 10: Chairman Abeta that that's correct.
Speaker 10: These are only changes to the benefits, not to the contribution structure.
Speaker 2: OK.
Speaker 2: But this would save us.
Speaker 2: Between US and the employees shared $900,000.
Speaker 10: Chairman Abeta, yes, that is the estimate of the savings based on your historical claims costs.
Speaker 2: And so is that 900,000 a year?
Speaker 10: Chairman, it makes it, yes, that would roll forward being that your starting point next year instead of an estimate or for this upcoming contract year, instead of an estimated $20 million in claims, I'd estimate the claims to be 19.1 million and that's going to flow forward.
Speaker 10: And again, what what, what you're really doing is shifting some of the costs on to on to the members in the form of deductible and coinsurance.
Speaker 2: Yeah, and the members that need it, because not everybody needs these.
Speaker 10: Correct.
Speaker 10: So, so you would not, you would see the 9.4% less roughly the 4% reduction in benefits.
Speaker 10: So it would the paycheck contributions would not increase as much.
Speaker 10: But for those employees who use that list of four services that we previously showed, those employees were paid more out of their pocket at the time of service.
Speaker 2: Right.
Speaker 2: OK.
Speaker 2: Are there any other questions from the committee?
Speaker 7: Here I have more questions.
Speaker 2: Sure, Councillor Endow.
Speaker 7: Would you please put the slide up that was just up.
Speaker 7: OK, in looking at this and looking at just let's look at the first column and the 3rd and the 4th column, did did we do saw any figuring on some of these co-pays?
Speaker 7: Are those significant for lab and X-ray?
Speaker 7: Our plan pays 100%, some of these others don't.
Speaker 7: The MRI, the benchmark, our plan pays 100%.
Speaker 7: These other plans pay 20%.
Speaker 7: After the deductible we've the certainly the physical therapy our plan pays 100% and both of these other plans have a $40 co-pay.
Speaker 7: Did we do any analysis on that and see what kind of money that came up to?
Speaker 7: Additionally, we have the massage, that's all.
Speaker 7: Do we know how much we pay in that a year?
Speaker 10: Chairman Abeita, Councillor Lindell, a lot of those changes were captured in that increased co-pay sheet.
Speaker 10: This the second-half of the the second option of the benefit changes.
Speaker 10: So this this captures a lot of those I did not look at increasing right now for medical massage, the member should pay the $30 specialist co-pay.
Speaker 10: However, we feel that some members are getting it under the get getting medical massages under the physical therapy benefit which you saw has no Co paying is covered at 100% up to 60 visits.
Speaker 10: We've requested some reports from Cigna to try to determine how much of an impact changing changing that physical therapy copay would be.
Speaker 10: But keep in mind, if we if we implement a co-pay for physical therapy, in addition to the medical massage people getting a benefit under physical therapy, you're also having the members who truly need to receive physical therapy pay a co-pay as opposed to having that covered at 100% right now do.
Speaker 8: We not require, sorry, jumping in on that topic.
Speaker 8: Do we not require a physician referral for PT?
Speaker 8: Can people just decide that they need PT and not not be going through their primary care?
Speaker 10: Chancellor Beta Councillor Sanchez Yes, there is a medical necessity requirement, however that that's that's difficult to enforce.
Speaker 2: Councillor Lindell, did you have you had the floor?
Speaker 2: Was there anything else?
Speaker 7: Well, I don't feel like my question was answered very completely, just saying that this table takes in most of that.
Speaker 7: I was really asking specifics if we had gone through and done some numbers on those.
Speaker 7: So I guess the answer is no.
Speaker 10: Chairman abates it, Councillor Lindell.
Speaker 10: Again, these do reflect changes in the co-pays.
Speaker 10: I did not mirror either the benchmark or the state plan.
Speaker 10: What I did was implement what I thought were reasonable to changes to the co-pays to get closer to the state of New Mexico plan, but I did not mirror those benefits you.
Speaker 7: Know on some level it's hard for me to know what I'm asking people to pay for or to not have paid for when I don't know how much the how big the numbers are that that we're talking about, I have no idea.
Speaker 10: Chairman debate to Councillor Lindell the numbers in terms of additional member share or the savings line by line on page 12 I'm.
Speaker 7: Talking about the slide that we don't have that is not up on the screen.
Speaker 7: Again, I don't have any idea like what our numbers are, what I mean, what kind of numbers do we have for people paying, you know, radiology, Mr.
Speaker 7: is urgent care.
Speaker 7: I mean, I don't know what those numbers really look like and how we're coming, how we determined that these were the places that we should determine savings.
Speaker 10: I want to back to Councillor Lindell numbers in terms of members utilizing utilizing each of these services.
Speaker 7: Correct.
Speaker 10: OK, I can work with Cigna and and see if we can get that.
Speaker 2: And on that point, Councillor Lindell, is one of your concerns, or at least what comes to my mind is, yeah, we don't want to.
Speaker 2: We don't want to eliminate something or make something more expensive.
Speaker 2: It is if it is something that really is needed or, or the opposite I would do.
Speaker 2: If it really is being abused, then maybe that's some place we target.
Speaker 2: Is that what you're getting at, Councillor Lindell?
Speaker 7: It is what I'm getting at.
Speaker 7: In addition, there may be some of these benefits that you know, they aren't really being used that much.
Speaker 7: We maybe those are the places that should have the increase in cost and you know, I don't know, I feel like I'm being asked to make a decision without complete data.
Speaker 10: Chairman Abeita, Councillor Lindell For those I I did not show the lower utilizer services, but because of their low utilization, changing the co-pays doesn't have much effect on the city's overall costs.
Speaker 2: OK, Councilwoman, be right.
Speaker 2: All I see your hand is up.
Speaker 2: Did you have a question or comment?
Speaker 4: I, I hear my colleague talking about needing to understand the amounts like what we actually have high usage in just so we can have a better or clear picture.
Speaker 4: What what I'm really wanting to make sure is if we decide something that's utilized by our staff is important, we want to keep that.
Speaker 4: And even if we had to increase or had a higher co-pay, I still think it's more important than completely eliminating a service.
Speaker 4: So I just want us to think about that or at least staff when you're making recommendations that these services, especially if they're like proactive ways to support health and medical improvements instead of being reactionary to our healthcare that we would look at trying to keep those but increasing in some way, whether it's a co-pay or something to that effect.
Speaker 4: So I guess I just, I agree with my colleague to look at our different options and you did give us some options, but I'm just thinking like if there is an idea of cutting certain services, if you could go back to that slide that shows us all of the comparisons.
Speaker 4: I just want us to be cognizant of that and I'm sure staff is looking at that it just like these these areas like plan pays 100%.
Speaker 4: That's great.
Speaker 4: However, if we had to make adjustments, I think that staff would make would want an adjustment other than having completely getting eliminating something from our our plan.
Speaker 4: So I hope, I hope my colleagues agree with that in that aspect.
Speaker 4: And then also how are we moving forward today once we finish this presentation, what's next?
Speaker 4: Are we talking with staff about ideas?
Speaker 4: Are we moving on to the next agenda item?
Speaker 12: Mr.
Speaker 12: Chairman, Councillor via Roy, Alex Burn So this is a presentation, it is an annual presentation provided by our consultant Aon to kind of gear us up for the new fiscal year and any plan design changes that the city decides to make.
Speaker 12: So what the next step will be is to meet with our.
Speaker 9: Group.
Speaker 12: Insurance benefits advisory committee which is primarily made-up of our union presidents of the city and to talk about some of these challenges that we're facing with the budget shortfall with regard to our plan.
Speaker 12: And then ideas basically this presentation with them on ideas on how to address that issue.
Speaker 12: Additionally, at the next council meeting, we will be requesting the approval of the extension for the Cigna contract as Don mentioned earlier in the presentation.
Speaker 12: But as far as plan design changes, yes, we will be meeting with staff and then bringing something to you before the upcoming fiscal year.
Speaker 12: I would like to also point out one thing as far as the Co payments, the fire union contract does have an article in their contract that puts a cap on co-pays.
Speaker 12: So that's definitely something we would have to negotiate with them.
Speaker 2: OK.
Speaker 2: And and on that point, Bernadette, OK, on, on that point, Bernadette, I mean that could not just with FIRE, but with all of our unions, if we're talking a $900,000 savings and insurance cost, that could have an impact on the amount that we furlough or even layoff employees if it comes to that, right?
Speaker 2: I mean, will that be something that you bring up in negotiations with them?
Speaker 2: Because I mean, it's real.
Speaker 2: It's a real savings I'm hearing, right?
Speaker 12: It's, it's a, it's a savings to what we're currently looking at, but it's still, even if we did one of the options, they're still going to be an increase to premiums, but their increase would be less.
Speaker 2: Right.
Speaker 2: OK, Councilwoman Casa Sanchez.
Speaker 8: Thank you so much, Mr.
Speaker 8: Chair.
Speaker 8: Couple questions.
Speaker 8: So looking at, you know, for increasing out of pocket maxes and deductibles, I know that there are some regulations around offering these options, but I'm curious if offering a health insurance account, our health savings account might be something that we can look at so that individuals employees might be able to take some pre tax dollars and put them into a savings account if they know that they have an elective surgery coming up this year or something along those lines.
Speaker 8: Can somebody provide us with a little bit more information if this would be an option given our current plan structure?
Speaker 8: I know that it is an option with with one of our plans, but not currently with our premium plan.
Speaker 12: Todd, do you want to talk more about those?
Speaker 10: Plans, I'm sure.
Speaker 10: Chairman Abate to Councillor Kasich Sanchez, I believe you.
Speaker 10: There is an HRA associated with the middle plan and I believe in Bernadette, correct me if I'm wrong, but I believe in FSA is available to the employees.
Speaker 12: Yes, it is.
Speaker 12: It is available.
Speaker 10: Yes, so, so again, they had, they already have that option.
Speaker 8: OK, wonderful.
Speaker 8: Glad, glad to hear it and definitely something that I think that we'll want to remind individuals of, especially if we're looking at those greater out of pocket, I'm sorry, the larger deductibles and knowing that those may be coming up.
Speaker 8: Also with our, you mentioned it very briefly, but was looking at our projections of claims for the upcoming year.
Speaker 8: I know that data is changing rapidly looking at COVID-19 and is do we have any idea of how this might impact our claims, especially given that we are self insured?
Speaker 10: Yes, Chairman Abaita, Councillor Castle Sanchez.
Speaker 10: All of the models that I have seen up to this point actually project a reduction in costs over the next three to six months because any elective services are simply not being performed right now.
Speaker 10: After that, it's it's largely going to be a matter of the number of COVID-19 members that you have.
Speaker 10: Roughly 80% of those are either asymptomatic or have a very mild case.
Speaker 10: Usually less than 10% are hospitalized and then there's kind of kind of 10% in between.
Speaker 10: Really what's going to drive the City of Santa Fe's cost is the number in that final bucket, those that are admitted to the hospital and, you know, possibly to the ICU.
Speaker 10: But what we expect is over the next three, three to six months is to actually see medical claims reduced.
Speaker 10: Estimates range anywhere from 10% to 35% reduction in costs.
Speaker 10: And then really the unknown at this point is of that pent up demand, how much will resurface in the fall.
Speaker 10: And then that number is very much in flux.
Speaker 8: OK.
Speaker 8: Thank you.
Speaker 8: And do we happen to know, you know, if we do have anybody that does go into the ICU, how much what the percentage is or how much on average a COVID-19 patient, how much those claims would be?
Speaker 8: Do they have any information on that right now?
Speaker 10: Chairman Abates Counselor Kessett Sanchez Actually not, and it's not the estimates I've seen range from 40 to 100,000.
Speaker 10: Again, there there's not really a treatment for them.
Speaker 10: It's just essentially keeping them in the hospital or ICU and until they until they recover or, or until they don't.
Speaker 10: So the costs are not, these are not several $100,000 claims that we've seen.
Speaker 10: It's more of those middle 50 to $100,000 claims.
Speaker 10: OK.
Speaker 8: OK, thank you.
Speaker 8: And I just want to, you know, echo what Councillor Villarreal said of looking at increasing co-pays at this point as opposed to eliminating benefits.
Speaker 8: Although if there is a way, and this is something, you know, we need to talk to Cigna about, I'm not sure if there are methods to ensure that we are not getting individuals who are potentially misusing benefits without blocking people having access to them if they needed.
Speaker 8: I'd be interested in exploring what that might look like, whether that is providing A reduced number initially and then having to submit additional paperwork.
Speaker 8: I know that that can be a lot on the side of the practitioners, but I'm just curious about some of that information, how we might be able to shore up those benefits to ensure that the people who need them are getting them.
Speaker 8: But we are not seeing any abusive benefits at this point.
Speaker 10: Chairman Abeita, Councillor Casa Sanchez, we requested a report from Cigna by provider that will detail both medical massage and physical therapy so that we can we can try to place appropriate barriers in place to abusing that that benefit.
Speaker 2: OK, Councilwoman Romero Wirth, you get the last word before we move on.
Speaker 6: Thank you.
Speaker 6: Mr.
Speaker 6: Chair.
Speaker 6: I think we need to give some direction about we're going to need plan changes given our fiscal situation and plan design changes.
Speaker 6: And you know, I think this plan has been described in past.
Speaker 6: Presentations in past years as being a Cadillac plan and I think we can no longer afford a Cadillac plan.
Speaker 6: And so, you know, we need to have, you know, we, we, we want to be competitive in the market for employees and we certainly want to take care of our employees.
Speaker 6: But the level at which we've been doing that, I, I think we can no longer afford as a city.
Speaker 6: And we, we're going to have to have some changes.
Speaker 6: And I, I don't know, Mr.
Speaker 6: Chair, how you want to provide that direction, but I think we need it.
Speaker 2: OK.
Speaker 2: I would, I think we need to direct the staff, Miss Salazar, if you can, if you can pursue the changes under the deductible, the 900,000, and then provide us with information with the so we can see the impact, specifically with specific benefits like the massages or physical therapy, radiology things that Councillor Lindell had talked about.
Speaker 2: And I would ask that you start to talk to the unions about the changes or whatever the contracts require, because I agree with Councilwoman Romero Wirth.
Speaker 2: I think this is something we're going to have to do sooner rather than later.
Speaker 2: And I think if it's a a choice between furlough hours or massages, I think even the unions would see that, you know, maybe we get rid of some of these massages and pay a little higher copay then and give up the massages.
Speaker 2: Because I think that's what for some reason that we always seem to get stuck on massages with this plan.
Speaker 2: But unless there's there's other members of the Finance Committee that feel strongly against this speak now.
Speaker 2: But I think this is something we need to get to work on.
Speaker 2: Miss Salazar, do you think you have clear direction?
Speaker 12: Mr.
Speaker 12: Chairman, yes I do.
Speaker 2: OK.
Speaker 2: Thank you.
Speaker 2: Thank you to Aon also for this presentation.
Speaker 2: We look forward to seeing the progress that we can make with our unions and our employees.
Speaker 2: Thank you.
Speaker 10: Thank you, Mr.
Speaker 10: Chair.
Speaker 9: Thank you, Mr.
Speaker 9: Chair.
Speaker 9: I'm going to stop sharing my screen so it should go back to you and we look forward to meeting with you next time.
Speaker 2: OK.
Speaker 2: OK.
Speaker 2: So that'll bring us to our next item.
Speaker 2: Miss McCoy, This is the FY20 budget update.
Speaker 3: You all see the PowerPoint presentation on the screen.
Speaker 2: Yes, I can.
Speaker 3: OK.
Speaker 3: And you all received a copy of this earlier today as well?
Speaker 2: OK.
Speaker 2: And once I get toy before you start, I'm going to ask the committee members to we're just going to I think we just ask you questions as we go from slide to slide.
Speaker 2: OK all.
Speaker 3: Right, sounds good.
Speaker 3: There's two parts to the presentation this evening, the FY20 budget update.
Speaker 3: The first is the state of our city finances from the operating budget perspective.
Speaker 3: We also have John Romero with us this evening to discuss what the committee requested around an update for our capital outlay projects for all of our capital projects as well.
Speaker 3: So 2 portions to tonight's presentation, the first being the operating, the second being our capital outlay.
Speaker 3: So starting off, as you know, we are in the middle of a public health emergency and the city's priorities are to keep the city health and healthy and safe as we continue to prevent the spread of the virus.
Speaker 3: Early on, the city's response to the public health emergency included very strategic targeted measures to prevent the spread of the virus.
Speaker 3: We closed certain facilities.
Speaker 3: We were able to stand up and eat government practically overnight.
Speaker 3: We are now operating an emergency homeless shelter at Midtown.
Speaker 3: Again, this is our top priority.
Speaker 3: So the first of our priorities is to continue to respond to the public health emergency and to keep our community healthy and safe.
Speaker 3: The second priority is to rebalance.
Speaker 3: Here we are looking at focusing on the city's essential services and we can go more into that as we are looking at our revenue shortfalls.
Speaker 3: And then the 3rd, as we look forward into the future is how we rebuild, how we go forward and ensure that our economic recovery is strong throughout our community.
Speaker 3: First, I'd like to share with you some data that we do have in this time where we don't have access to much real time data.
Speaker 3: We're going to review with you some data on unemployment claims, some data on our transportation in our hotel industry.
Speaker 3: So First off, these are initial unemployment claims in Santa Fe County.
Speaker 3: They started off low in the early part of March and then as soon as we went into the period of the stay at home order, those enclosure of non essential businesses, those unemployment, initial unemployment claims skyrocketed.
Speaker 3: So here we have week by week both a comparison for the Santa Fe County as well as the state.
Speaker 3: And as you can see, the percentages are in have increased and then started to level off.
Speaker 3: The statewide weekly high during the last recession was just over 3000 initial claims a week for the entire state.
Speaker 3: That is so we can see how unprecedented the current crisis is that we are in and how severely this is impacting our community.
Speaker 3: Next we have some industry data that from the hotel industry that shows occupancy and the revenue per available room.
Speaker 3: So both measures were up year over year when we compare January and February and we saw that through our lodgers tax collection.
Speaker 3: We saw that through our GRT coming in strong in these sectors for those for those months when we hit March, we see this decrease close to 50% and that is just for half of the month that where we saw the stay at home order.
Speaker 3: So these the impact has been significant in one of our major industries as far as our transportation data from both our two very different groups from our bus ridership in the city as well as our air traffic through the Santa Fe airport here month over month as well we are seeing significant declines.
Speaker 3: So these are different data points in our economy that we do have real time data in.
Speaker 3: So we are seeing those decreases.
Speaker 3: That's to set the stage for the next section of our presentation where we start to turn to our city's finances and the impact that the downturn in the economy is having on our fiscal and our financial system.
Speaker 3: So just a bit of history, our S&P and Fitch Ratings were AA plus for our last bond issuance and both S&P and Fitch have cited our strong proactive fiscal management, our conservative budgeting and our revenue maximization and data-driven management as reasons for that strong bond rating.
Speaker 3: So moving forward, we have been able to build up our reserves over the last few years and that will be able to carry us a portion of the way towards our shortfall and we'll talk a bit more about that in a second.
Speaker 3: So for this section of the presentation, we're going to dive into our gross receipts as it is our primary revenue source into the general fund.
Speaker 3: GRT is about 70% of the general fund and about 30% of all of our other funds.
Speaker 3: So here we can see what drives our GRT by these industry sectors throughout Santa Fe.
Speaker 3: Retail trade is the highest at 33%.
Speaker 3: Hospital, hospitality and food services, Construction, manufacturing, Barry.
Speaker 2: Let me stop you there re retail trade.
Speaker 2: What is that define?
Speaker 2: Give a specific example.
Speaker 3: Yes.
Speaker 3: So retail trade is shopping essentially all the retail merchandising that?
Speaker 2: Essentially.
Speaker 3: Has been closed Sante Place mall.
Speaker 3: That is correct, exactly.
Speaker 3: So if you think about the last time that you drove around the city of Santa Fe, as you're looking at this pie chart, you can start to piece together a picture of our economy.
Speaker 3: Driving down Serios and St.
Speaker 3: Mike's.
Speaker 3: Passing the rental car facility off of Serios in the shopping center that that rental car facility, the parking lot is full.
Speaker 3: Passing the Santa Fe Place Mall towards the South side, that's closed.
Speaker 3: The parking lot is empty.
Speaker 3: So as you drive around and you look at these different industries, what is still operating?
Speaker 3: Our elder care facilities, those are still operating.
Speaker 3: So we dissected the GRT by sector, the finance staff did and we reviewed the percentage of activity that is still remaining in each of these different sectors.
Speaker 3: And we came up with three different scenarios to inform our revenue projections that we are presenting to you this evening based on the.
Speaker 2: But retail trade makes up 33% and that's probably the sector that got hit the hardest is or the area that had to shut down.
Speaker 3: Correct.
Speaker 3: That is one of the largest sectors and also considered non essential.
Speaker 3: OK.
Speaker 3: Thank you for the most part.
Speaker 8: Sorry Mary, where do our grocery stores part of food service or would they be retouched?
Speaker 3: I believe they are part of food services.
Speaker 2: OK.
Speaker 2: But we don't get tax on, we don't get tax on groceries, right?
Speaker 3: That is important.
Speaker 3: Food and medical are exempt and we receive a distribution from the states.
Speaker 2: So it's great that these, so it's great that people are still able to go shopping at groceries and do all that because they can access food.
Speaker 2: But so if, if Smith's or Albertsons or Market station says, hey, business is booming, we're they're buying up all the eggs and the bread and the milk, there's, well, we don't see any of that.
Speaker 6: Mr.
Speaker 6: Chairman.
Speaker 2: Yes.
Speaker 6: Councilwoman So I, I think something that's important for the Finance Committee to keep an eye on is it's because we don't pay tax, gross receipts, tax on food we do get from the state something called hold harmless money.
Speaker 6: And that level of money, I think how much we get from the state will certainly be an issue in a special session as a way to help local governments survive this downturn.
Speaker 6: That we, you know, maybe we, I know the municipal league is looking at recommendations that would ask that we have and that hold harmless amount has decreased over time.
Speaker 6: And SO11 proposal that may be floated is that that hold harmless level go back to earlier years when it was higher because local governments need the revenue because of this down downturn.
Speaker 6: So just something for the Finance Committee to be aware of and to keep an eye on as we look for help from the state.
Speaker 2: OK.
Speaker 2: Thank you.
Speaker 3: So understanding the sector breakdown on Slide 8, the finance staff has built three different scenarios for GRT and for other revenue sources to give us a range of what the GRT shortfall might be.
Speaker 3: And we what we are presenting here shows GRT could precipitously decline within the four month period starting from March, April, May and June, the last four months of our fiscal year anywhere from 15,000,000 to 21 million.
Speaker 3: This is a significant decline, as you can see from the table at the bottom of Slide 9.
Speaker 3: Generally, over the last five fiscal years, upwards of 30% to 37% of our revenue has been generated in these four months.
Speaker 3: So as we start to head towards the summer season, as we start to head into the 2 summer tourism season, our revenue starts to increase.
Speaker 3: Our revenue from GRT starts to increase over this period of time.
Speaker 3: So scenario 1-2 and three shows that that will contract over this very important period in our GRT collection.
Speaker 2: Could it contract even more?
Speaker 3: Yes, that's an option.
Speaker 3: So I guess one of the principles to understand are these are estimates and these are our best guesstimates based on the data that is available to us at this point.
Speaker 3: That's why we started out with the economic analysis that data points that our staff has put together for us from the airport, transit system, hotel industry and the unemployment numbers.
Speaker 3: Again, understanding that this is completely unprecedented and we really do not have the ability to understand what even the March GRT revenue is to the city until the middle of May.
Speaker 3: So there is a 2 month lag in the distributions from the state to the city.
Speaker 3: So the first time that we have any insight to the impact on our GRT revenues will be a month from now.
Speaker 3: And again that is too late to start looking at these range of options.
Speaker 3: We can see from 15 to 21 is a big swing.
Speaker 3: It might be less, it might be more, but based on the economic activity that is currently ongoing, we know this is a reasonable range.
Speaker 3: We need to pick a number to be able to plan for because we are so far into the fiscal year, we have to start to make the budget adjustments that are necessary to start to curtail spending.
Speaker 3: So we will not run a a large temperature.
Speaker 6: Mr.
Speaker 6: Chairman.
Speaker 2: Yes.
Speaker 6: So Mary, in these assumptions you're assuming that that we are operating under the current stay at home through the summer or are you looking at different levels of operation in any of these scenarios or are you taking basically kind of the current stay at home orders and which essential businesses by sector are operating to come up with these projections?
Speaker 3: We are working with the assumption that the current stay at home order stays in place through the end of June.
Speaker 6: Thank you, Mr.
Speaker 6: Chair.
Speaker 3: So moving on to slide 10, this is a history of about a 15 year.
Speaker 3: For our GRT revenue growth.
Speaker 3: This shows the revenue increases before the the Great Recession and the $14 million decrease over the span of two to three years during the Great Recession.
Speaker 3: And then that it took us about 7 years to climb out of the recession and see GRT levels return to pre recession GRT levels.
Speaker 3: So at this point, we've continued with steady growth.
Speaker 3: We were on pace to outperform our $112 million revenue estimate for GRTS at this point.
Speaker 3: Well, and as of February, we were up about 7 to $8 million in our GRT collections per month.
Speaker 3: So we had a very, very strong showing and for the first part of the fiscal year.
Speaker 3: So that is the good news of this.
Speaker 3: The bad news is the middle of the road scenario which we presented to you in the previous slide shows GRT coming down to about 94.3 million.
Speaker 3: And again, just in terms of comparison, we lost about $14 million over the course of two to three years.
Speaker 3: And this time, wherever we do land up with our GRT, we will have lost that GRT in the course of four months.
Speaker 3: So this is the analogies that have been thrown out there as the rug got pulled from out from underneath us very quickly.
Speaker 3: And just as quickly we've had to put together these scenarios given these ranges and start to plan so we don't encounter a large shortfall.
Speaker 3: So moving forward, I think many of you have heard us talk about these estimates in the last few days.
Speaker 3: So that all funds shortfall that we are budgeting to is 46,000,000.
Speaker 3: The shortfall in the general fund is closer to 14,000,000.
Speaker 3: And so in order to manage and not have that large of a deficit, the city has implemented a spending freeze for non essential purchases, hiring freeze for non essential staff and is restricting overtime to reach this $46 million target that we have.
Speaker 3: And again.
Speaker 2: Is that OK, Mary?
Speaker 2: That's the was that, is that the next slide, Slide 12?
Speaker 2: Yes, OK.
Speaker 2: But you you said there was a a potential deficit of 46 million.
Speaker 3: Correct.
Speaker 2: So the 28 million doesn't get us to the 46.
Speaker 3: That is correct.
Speaker 3: That is correct.
Speaker 3: So what we have mapped out here is these four different areas where we can achieve multi $1,000,000 savings to the tune of the $28 million at the Chairman reference.
Speaker 3: A spending freeze for all non essential discretionary spending that covers the gamut from travel to office supplies to any type of activity that we had planned in the last quarter of the fiscal year that now will not happen because of the stay at home orders.
Speaker 3: Additionally, the city has implemented a hiring freeze for non essential vacant positions and that will garner about 2.5 million whereas the spending freeze our target is 25,000,000.
Speaker 3: The overtime restrictions for non essential staff, we estimate we can save 500,000 in the next few months and separating temp employees that are considered non essential garners us close to $200,000 for that total of 28 million.
Speaker 3: But as the Chairman mentioned the number that we're keeping in mind across all funds is 46,000,000.
Speaker 3: So we're still 18,000,000 short from from covering the Rev the estimated revenue shortfall, the additional.
Speaker 6: Mr.
Speaker 6: Chair, yes, I'm sorry, Mary, maybe you're about to get to this and and the our, you mentioned our, our reserves, what, what is the total of those at this point?
Speaker 3: The total reserves that we're showing starting the fiscal year is 14,000,000.
Speaker 3: That 14,000,000 is in excess of the city's 10% required reserve minimum.
Speaker 3: So that's around 9 million given the given the budgeted levels and as the budget, as the expenditure budget shrinks, that 10% target also shrinks the 10% minimum reserve requirement that's based off of expenditures.
Speaker 2: So, so are you saying the more we we control our expenditures then the savings requirement lowers too, so we save there also?
Speaker 3: Correct.
Speaker 3: And that allows us a larger pool of general fund reserves to be able to draw down on.
Speaker 3: So consider the reserves like our your personal household savings account.
Speaker 3: And so when if I were in a situation where my income was cut off, I would first look to reduce my discretionary expenditures.
Speaker 3: Unfortunately, many people in our community who have lost their jobs are doing now.
Speaker 3: So first you know what goes those trips to the movies, the trip to the rest of your favorite local restaurants.
Speaker 3: So those are all the what we are considering the spending freezes for non essential items.
Speaker 3: Next, then we would look to our own savings account and and consider drawing down on the savings account to pay for the essential expenditures at this.
Speaker 2: Point.
Speaker 2: So we have 14 million in savings and what we have to have is 9.
Speaker 3: Correct.
Speaker 2: And so you, the mayor and you actually did was pretty, pretty good to save 14 last year instead of just the 9:00 because we do have something at least that we could work with now.
Speaker 3: We have grown those reserves over the last few years in the city and again it goes back to one of the first slides for the city finances.
Speaker 3: Because the city has had strong fiscal management, because we've had a conservative approach to our budgeting, we've been able to grow that rainy day fund for an opportunity like this.
Speaker 3: However, we do realize that the Save our savings account isn't quite as big as what our shortfall is, and so we're going.
Speaker 2: To do and the mayor for having that foresight 2 years ago last year and not just spending all the way down to to the 10% minimum.
Speaker 3: So I think that sets us up good for the next few slides to talk about all of our different options as we look to balance the additional 18,000,000 across all of our funds.
Speaker 3: The mayor is planning to introduce a resolution calling on the federal government to provide an additional stimulus package for additional financial support to local governments.
Speaker 3: Doesn't seem likely that it will be in the stimulus package that is in front of being discussed in DC and to be voted on this week, but potentially in a fourth wave of stimulus.
Speaker 3: So we're actively lobbying and encouraging our congressional delegation to support that.
Speaker 3: As far as state support, we, the state did receive $1.25 billion in the CARES Act.
Speaker 3: So we did not receive direct funding for our response to the coronavirus, although we are incurring expenditures to support our community through the public health emergency, including the activity at Midtown.
Speaker 3: So we would look to as many federal and state sources for reimbursement of those expenditures.
Speaker 3: Additionally, on the revenue side, we are looking at 2 areas where the state could provide additional support.
Speaker 3: I believe we talked about this during our last committee meeting is requesting actual GRT distributions from the Internet sales tax in FY20.
Speaker 3: The state was not set to provide actual distributions to local governments for the Internet sales tax for a few more years.
Speaker 3: But given that many of our purchases have been transitioned to online sales as folks are ordering their supplies online and having them delivered to their house.
Speaker 3: I think this is a good opportunity to true up our GRT distributions which would in this area which would increase our total overall revenue for FY20.
Speaker 3: Additionally, there are some of our funds are set in state statute.
Speaker 3: So if we were able to effectively lobby for changes to state statute for these funds, we could allow the city to use the fund balances for general municipal purposes to be able to support that $18 million gap.
Speaker 3: And Slide 14 really focuses on the revenue and additional expenditure levers that the city has within our control.
Speaker 3: Again, through this administration, we've been able to build up our rainy day fund and the recommendation would be to use a portion of this rainy day fund to support the the gap that we're facing.
Speaker 3: And additionally, there are other funds.
Speaker 3: We have about 70 funds across our financial system and some of them are restricted by our city ordinances to be used for specific purposes.
Speaker 3: So we are actively looking at opportunities to use these about or we're actively looking at the legal authorization that would be necessary to use the fund balances and these funds for general municipal purposes, again to bridge that gap in our shortfall.
Speaker 3: Additionally, we do have other revenue opportunities considering the city's real estate portfolio which would generate one time revenue.
Speaker 3: And for specific examples, we could save operating and debt service costs at the same time if we were to dispose of those city assets.
Speaker 3: And then finally, there are additional expenditure lovers in addition to having the $25 million target for discretionary spending savings as well as the 2.5 million in hiring freeze for vacant positions.
Speaker 3: That involves the chain plan design changes that you just reviewed with Aon as well as other expenditure categories where we can start to review the essential city services that are legally required for a municipality to provide versus some of the discretionary programming that we have.
Speaker 3: In addition, Byrne and her team have been reviewing the city's HR policies and have brought to the table a few recommendations where the HR policies as they are currently written do have a fiscal impact to those.
Speaker 3: We are planning to bring changes to you over the course of the next few months to reduce the fiscal impact of some of the city's HR policies.
Speaker 3: So that brings us to our next steps.
Speaker 3: There's this is very serious, it is a precipitous decline that we were not expecting if we just take a few steps back.
Speaker 3: A month ago, we were in full swing to finalize the FY21 budget with a series of investments across the city, from public safety to programming in all of our neighborhoods.
Speaker 3: Now a month later, Fast forward and we're looking at monitoring actively on a weekly basis our FY21 revenues and making significant cutbacks.
Speaker 3: So in order to do this, we want to engage both the public and our employees in a series of surveys and work groups that are meant to elicit suggestions and recommendations on where the city should be spending our reduced revenue and how we can go about achieving these cost savings.
Speaker 3: So we will continue to actively monitor our revenues and make these budget adjustments.
Speaker 3: But for the meantime, we will be submitting our FY20 budget, the current year budget.
Speaker 3: As a placeholder for our FY21 budget, DFA has changed these rules for all local governments in that budget will be due June 1st.
Speaker 3: And so starting in May, we will be looking ahead to completely revising our FY21 budget and moving towards having but a budget hearing process in July of 2020.
Speaker 3: This will queue us up to be able to submit a revised FY21 budget to DFA as of July 31st.
Speaker 3: And then as we move forward into the new fiscal year, given this economic crisis was caused by the public health emergency, which we do not know when, we are going to start seeing an opening up of our economy again.
Speaker 3: So we will continue to monitor our revenues on a much, you know closer week by week basis as we move forward into 21 to determine if any additional budget adjustment measures are necessary as we go forward.
Speaker 3: So we are actively managing through this and we're at a very different stage of this process than we thought we would be at now.
Speaker 3: In the middle of April, we thought we would be meeting to vote on our FY21 budget, but we've had to make some pretty significant changes in direction and set the path for these cutbacks to manage that 40 million plus shortfall in revenue that we are expecting.
Speaker 2: Mary, we got an e-mail at the end of the day from the mayor and in it he had stated that we were going to implement furloughs anywhere from 4 hours a week to employ employees going down to three day work weeks.
Speaker 2: How much is that going to save and is that factored in, in the 28 million with the hiring freezes and that number you gave us earlier?
Speaker 3: That is not factored into that $28 million number.
Speaker 3: And as you can appreciate from your background that Mr.
Speaker 3: Chairman that double S in the details.
Speaker 3: So determining person by person, position by position who will be facing a four hour furlough versus an 8 hour furlough versus a 24 hour versus a 16 hour furlough is very detailed work that our HR department is in the middle of doing now.
Speaker 3: So if Bernadette is still on the phone, she can give us some additional details, but it is approximately $1,000,000 savings over the course, $1 million over the course of two months.
Speaker 2: OK.
Speaker 2: So, so to recap, hopefully we have a $46 million shortfall, but it could be worse across all funds.
Speaker 2: You've already taken steps or you've identified where we could come up with $28 million to put towards that.
Speaker 2: That leaves us a balance of 18,000,000.
Speaker 2: There's cash reserves above the 10% of 5 million.
Speaker 2: So heck, even if we put the whole 5 million, I don't know, that's something you and the mayor need to consider.
Speaker 2: We're at 13 million.
Speaker 2: We take the furloughs, which is 1,000,000.
Speaker 2: We still have a $12 million shortfall potentially.
Speaker 3: Mr.
Speaker 3: Chairman, that is correct.
Speaker 2: Even with the furloughs that just were just announced, yes.
Speaker 3: And the $1,000,000 is an approximate number we will we can get back to you on the exact savings.
Speaker 2: OK.
Speaker 2: And then as far as just going back to the 28 million, I assume that includes everything not personnel related, not salary and benefits related.
Speaker 2: So there's no more, there's no more juice we could squeeze out of that lemon, right?
Speaker 3: Correct.
Speaker 3: That is pretty aggressive targets to be able to cut back across the city.
Speaker 3: And very important point that we still have to make is that the city continues essential operations.
Speaker 3: We continue water, wastewater, trash pickup.
Speaker 3: Our police and our firefighters are first responders that are on the front lines dealing with the coronavirus pandemic.
Speaker 3: So there are still very important operations that have to continue.
Speaker 3: That's why we have segmented into discretionary and non discretionary spending at the moment.
Speaker 2: OK.
Speaker 2: Well, my, my initial thoughts is I don't think we went far enough with the furloughs obviously, but that's something that you all need to need to think about.
Speaker 2: And unfortunately, because 70% of our, our expenses are people and we've taken out from everywhere else, I think we're going to have some tough decisions ahead.
Speaker 2: I mean, there's, we're dealing with math here.
Speaker 2: Not, not, you know, with math, it's, it is what it is.
Speaker 2: Some people really like math because you're, you're right or you're wrong.
Speaker 2: And other people don't because you're either right or you're wrong.
Speaker 2: It's not like English where I liked English because you can Give your opinion.
Speaker 2: You can, but we're dealing with salt with numbers here.
Speaker 2: And and this is.
Speaker 6: This is Mr.
Speaker 6: Chairman.
Speaker 2: OK, I'm done.
Speaker 2: Go ahead, Counselor Romero, Work and go 1st and then we'll open it up to the committee.
Speaker 6: I just, I also just want to emphasize the need to seek federal help and particularly the the CARES Act.
Speaker 6: We were a city that it was not big enough to qualify for a lot of that funding.
Speaker 6: And I think, Mary, I want to thank you and your staff for these numbers and for giving us just even some guess as to where we are because I think they're going to be important for us to talk with the the congressional delegation to help understand the seriousness of the situation.
Speaker 6: It helps.
Speaker 6: I mean, I think everybody realizes that this is a very serious situation, you know, for businesses, for households, for government, for nonprofits, for all sectors.
Speaker 6: And so it's very helpful though, to, to the chairman's point, to have the real numbers are real best estimates of of the deep financial situation that we're in.
Speaker 6: And we have got to lean on the federal government that we need more help.
Speaker 6: And I just, I just want to emphasize that because I'm not sure that we can get out of this without help from outside of the city.
Speaker 2: OK.
Speaker 2: I want to hear from other members of the Finance Committee.
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 2: Yes, Councilwoman, but I had.
Speaker 4: To raise my hand, but I didn't get to it, sorry.
Speaker 2: No problem.
Speaker 4: Thank you staff for putting the numbers together for us.
Speaker 4: It's pretty sobering to see where we're at and what kind of difficult conversations and decisions that we'll have to have.
Speaker 4: I guess what I was, I had a few questions about some of the data that you provided us or just elaborating based on the savings that you gave us about the freeze.
Speaker 4: Can you say a little bit more about just so we know number wise we, we essentially looked at temps and were how many temps are we talking about a positions that we, I don't want to say eliminated, but I feel like that's that we are transitioning out of because we have to, we have to cut the, we have to cut temps.
Speaker 4: So how many are we talking about?
Speaker 3: I want to ask Burn if she's on the phone to to chime in.
Speaker 3: She has the details.
Speaker 13: Let me I have multiple screens going on here, so give me just a second and.
Speaker 4: Maybe that same screen will also tell us about overtime pay.
Speaker 4: How much that amount is that we're for overtime?
Speaker 4: Specifically, in which departments were we targeted targeting?
Speaker 3: So I can speak to that while Burn pulls up the temp employee data on our overtime, the primary departments that see overtime are the Police Department, the fire department, the Public Utilities department and the public works department.
Speaker 3: And then the balances the remainder of all of our departments from finance to HRIT general government, which includes economic development, affordable housing.
Speaker 3: So the expected savings on these on these overtime restrictions would be in the non public safety or non essential staff.
Speaker 3: So we understand that if a street light goes out.
Speaker 3: There's not a crew on on duty.
Speaker 3: We would have to call a crew in to fix those streetlights.
Speaker 3: There is consider essential staff is public health and safety related.
Speaker 3: We need our water plants, our wastewater plants to be up and running so the city receives clean water and same goes with our firefighters and our Police Department.
Speaker 3: So the majority of our overtime is incurred by those departments.
Speaker 3: But even within those departments if there is non essential staff that is incurring overtime, that is what will be restricted and it's about 250,000 per month for the month of May and June are our targets so.
Speaker 13: Councillor, we array out.
Speaker 13: We have about 41 tenths that we will be separating at this time.
Speaker 2: OK.
Speaker 2: And on that point again, Mary, that was already factored in the 28 million that you said was you're going to come up with savings.
Speaker 3: Yes.
Speaker 2: So there aren't more to let go of.
Speaker 3: Pardon me.
Speaker 2: There aren't any more temps we can let go and save more money.
Speaker 13: No, that's that's it.
Speaker 2: OK, thank you.
Speaker 2: Go ahead, Councilwoman B Rail.
Speaker 4: Thank you.
Speaker 4: Thank you.
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 4: I'm just going through the different sections of of the presentation.
Speaker 4: I was thinking about the federal support, the federal supports that my colleague was referring to and the fact that we didn't get any stimulus package money.
Speaker 4: So I know we're doing this resolution and a lot of us are probably Co sponsors, but I was told by Heinrich staff that we're going to be they're going to be taking a vote.
Speaker 4: So possibly in the next 24 hours and they still haven't adjusted it.
Speaker 4: So I'm just trying to think of a way we can keep pressing on that even though there's possibilities for future federal stimulus funding.
Speaker 4: Do you all have any other suggestions about that?
Speaker 4: I know that they had a let's see, it's the National Council.
Speaker 4: What is it the?
Speaker 6: National League of Cities.
Speaker 4: The national, well, they call it something else is CLN.
Speaker 4: And they had a webinar today and they were talking about, you know, what ways they're lobbying to try to make those adjustments.
Speaker 4: And there's that piece, but then there's this other piece about state funding that the state received certain municipal funding that we would be able to access.
Speaker 4: And they talked about accessing liquidity.
Speaker 4: And I was wondering if maybe you could talk a little bit more about that with what that means for us and if that's a viable option, if that changes anything or adjust or provides more financial stability for us?
Speaker 3: Mr.
Speaker 3: Chairman, Counselor Villarreal, I'm going to have to get back to you on that.
Speaker 3: We will provide an update to you later on tomorrow.
Speaker 4: OK, sounds good.
Speaker 4: Then we talked about like reducing real estate, the real estate portfolio.
Speaker 4: Do you know specifically what that's going to look like?
Speaker 3: Mr.
Speaker 3: Chairman, Counselor, the city has several owned several different properties across the city as part of our asset portfolio.
Speaker 3: I think the ones that you all might be most familiar with are Santa Fe Estates as well as the Midtown campus.
Speaker 3: And so right now for example with the Midtown campus, we are spending 4.6 million a year on both operating and debt service costs.
Speaker 3: So in addition to having potential one time revenue if Santa Fe States asset or the Midtown asset is sold in partially or in whole, we could also save on those debt service and operating costs, a portion of the debt service and operating costs.
Speaker 3: So it would be 1-2 punch.
Speaker 3: We would get the one time revenue coming from the sale as well as with Midtown campus, specifically the operating and debt service payments.
Speaker 4: Thank you for that.
Speaker 4: I guess I'm, I was curious, there was a, a point where you said talked about our balances hold on the fund balances and being able to access them.
Speaker 4: Can you say which funds specifically you were looking at?
Speaker 3: Yes.
Speaker 3: So probably the lowest hanging fruit is something like the rail yard fund.
Speaker 3: We, this is something that you all voted on at the end of March.
Speaker 3: We were able to draw down 500,000 from the rail yard fund because that fund is available for general municipal purposes and that 500,000 went into an emergency fund for the COVID-19 emergency response.
Speaker 3: So there's about 800,000 remaining in that fund balance.
Speaker 3: So we can access that remaining 800,000 to plug into the remaining deficit the remaining shortfall that we have.
Speaker 3: In addition to that, there are several other funds across the city that we would have to look at the legal authorizations and change those.
Speaker 3: They bring them to council to vote on a change of the legal authorization to then be able to access the fund balances.
Speaker 3: This is common during a recession.
Speaker 3: This happened when I was working at the state during the last recession.
Speaker 3: There were several different funds that had fund balances and in order to plug the gap, they were able to access using the legal authorization.
Speaker 3: Those different fund balances to balance the deficit that they were facing are.
Speaker 4: There specific funds you're thinking that we'd have to make those adjustments legally?
Speaker 3: I see Brad is on the line.
Speaker 3: If Brad can, maybe there's one or two at the top of your list that you can review with us.
Speaker 5: Thank you, Chairman, Councillor Villarreal.
Speaker 5: Thank you, Mary.
Speaker 5: Yeah, there's a number of funds.
Speaker 5: We have the the CIP reallocation fund which was basically gross receipts tax received in the past allocated out to CIP projects.
Speaker 5: It's not bond proceeds, it's GRT revenue.
Speaker 5: The project's been completed and there was leftover funds, you know little projects, 3040 thousand pile that all that up.
Speaker 5: We would actually go in and look at sweeping all projects that have are finished.
Speaker 5: There's right now $600,000 in that fund that there's a question whether is it capital or is it really GRT.
Speaker 5: We would like to get that clarified and get it used to use for general purposes.
Speaker 5: There's the quality of life funds.
Speaker 5: The first obligation of that fund is to fully fund transit.
Speaker 5: Well, transit as we saw earlier in the chart there operations have revenues have substantially declined and so they're not going to need that entire allocation of quality of life funds.
Speaker 5: So then it's next purpose is recreation and we have all of those facilities closed.
Speaker 5: And so do we really need to put more money into the recreation fund that has a balance of 2.7 million, It's been accumulated over the years and so we would.
Speaker 3: Look, and on that point, part of the $46 million deficit would be within recreation.
Speaker 3: Our recreation funds like the Chavez Center Fund where we continue to pay some costs to maintain the facilities in operation and continue to pay employee salaries and benefits, while we are not seeing revenue coming into that fund.
Speaker 5: And so lastly, once you get through the the recreation, the last thing that these monies can be used for is general government purposes.
Speaker 5: And so we're working with the city attorney's office to get a better understanding of exactly what the statutes mean, what are the ordinance mean?
Speaker 5: What are what can we do, what can we change to make these funds available if necessary?
Speaker 2: Brad, on that point though, are we talking pennies and nickels or are we talking dollars and are we talking millions or are we talking thousands?
Speaker 5: Why can't?
Speaker 5: Well, let's see.
Speaker 5: I mean, I don't know if I have the thing up, but one fund has 6.9 million in it.
Speaker 2: OK.
Speaker 3: And then also just want to put a point of caution.
Speaker 3: I think we were clear in the beginning, Mr.
Speaker 3: Chairman and counselors, that the $46 million number is an estimate that could be conservative or not.
Speaker 3: And so in the event that that is not conservative and we end up losing more than the 46,000,000 within these four months, we are really going to have to rely on our balances, general fund balances included, as well as the other funds that Brad was giving us an overview of.
Speaker 3: So we can't bank on all of those to fill the shortfall, but we know we will have to rely on some.
Speaker 4: Right.
Speaker 4: When we say rely and making adjustments to these fund balances, we're talking about a temporary fix, I mean a temporary adjustment.
Speaker 4: So it wouldn't be like the quality of life fund would always continue funding our general fund.
Speaker 4: It was really in this time of need, emergency needs.
Speaker 4: Are you saying then it would just be it would revert back after a certain time period or how do we control that so that we don't adjust these funds that, you know, when we actually are back on track that we still need them to be able to support services?
Speaker 3: Mr.
Speaker 3: Chairman, Counselor, that is an excellent question right now.
Speaker 3: The reason I added into the next steps on the last slide on page 15, a timeline of what we are looking ahead to.
Speaker 3: Really these are difficult decisions that we have to make very rapidly to adjust to a revenue shortfall in these four months.
Speaker 3: Equally difficult decisions and equally painful revenue estimates as what we are going to be looking at for the FY21 budget process.
Speaker 3: And so we are aware as it during the last recession where it took seven years to bounce back to pre recession GRT levels, that this will have an equally long road to recovery.
Speaker 2: And so the.
Speaker 3: Changes that we are planning for FY21, will we at least have an opportunity to plan for them unlike the changes that we are having to make currently.
Speaker 3: But to those changes, well, we are expecting to be very difficult decisions about the service level that we have to provide in each one of our departments.
Speaker 2: So, so following up with the Councilwoman Brail, she makes good points that we, we are in this emergency, but that but like you could assume or some people have assumed, oh, well, once everybody can open back up again, GRT is going to shoot back up.
Speaker 2: We're going to go back up to $112 million.
Speaker 2: There's businesses that have closed there's and so we're going to have to right, size our government to deal with the longer recovery that's coming because I, I don't think it's going to just be OK.
Speaker 2: COVID-19, we have a vaccination or we're testing everybody open back up.
Speaker 2: So all of a sudden, like I said, we go back to trending at 112 million a year, right?
Speaker 2: Is that, I guess that's what you're saying that this isn't just a one time thing.
Speaker 2: We've got to look at the the long term.
Speaker 2: And so I agree with Councilwoman B Royale, we, you know, we want to use things to plug in the gap for now, but we're going to have to take a look at city operations in general probably and lower the expenses all across the city because I don't think GRT is going to rebound to what we saw, you know, up until February or whenever this hit.
Speaker 3: Mr.
Speaker 3: Chairman, that's absolutely correct.
Speaker 3: And we are continuing to be in an economic free fall.
Speaker 3: I don't know if you all pay attention to the markets, but continuously through the day, our Planning and Investment Officer, Brad was sending me updates about the talk about a precipitous decline.
Speaker 3: It's just the free fall in the oil market for future the futures contract.
Speaker 3: So I just also want to remind folks that the state's budget is built on oil at a particular dollar per barrel.
Speaker 3: And so as the state faces their own shortfalls in the coming for the coming fiscal year, that could potentially or that will impact the Santa Fe economy as well as the state government.
Speaker 3: Government is one of the largest employers in the city.
Speaker 3: And so if the state is also considering furloughs or a reduction in force for employees at the state given their shortfall as well, that would have an impact on our local economy.
Speaker 3: And there are opportunities to adjust their budget come a little more infrequently than this body.
Speaker 3: They meet once a year on January, February, March.
Speaker 3: And then if they need to adjust, they have to convene in a special session as you all are aware.
Speaker 3: So those those adjustments, I guess what I'm saying is we're very fortunate to be able to meet every two weeks to to keep you informed and keep you updated about these changes that we are seeing in front of us and the changes that we will need you to vote on shortly for the FY21 budget.
Speaker 2: OK, Councilwoman Birao, you still have the floor.
Speaker 4: And last question, I just wanted to understand better since we just got that e-mail from the mayor regarding furloughs.
Speaker 4: And can Director Celisar talk a little bit more about what that looks like, if it's how that process goes, specifically if there's voluntary furloughs and then it how the progression goes, I don't understand how the process how it works.
Speaker 13: OK.
Speaker 13: Thank you, Mr.
Speaker 13: Chairman, Counselor Villarreal.
Speaker 13: So within the union contract it requires works work with the unions and in the Ask Me contract it actually has a clause that allows the union to provide anyone who would like to do a voluntary reduction, but it doesn't prohibit the city from putting forward a plan before that seven day time frame.
Speaker 13: So we've worked countless hours trying to work with the unions and putting forth some different proposals that will try to help us close that budget gap a little bit.
Speaker 4: And with non union, does that work the same way?
Speaker 4: There's voluntary aspects and because you did say or or Director McCoy said four hour, 8 hours, 16 hour or who said that?
Speaker 4: I'm not sure, but I don't quite understand what that means.
Speaker 13: OK.
Speaker 13: So the way that we've done work on potential furloughs is we've looked at it across the board and looked at what employees are working at a facility that's either closed or their work has been reduced as a result of the emergency that we're all faced with.
Speaker 13: And, and then looked at the union contract and the union contract, and this is specifically for Ask Me says that if an employee is going to be furloughed, they can't be furloughed more than 24.
Speaker 13: They have to have at least 24 hours of work time a week.
Speaker 13: And so we tried to apply that thought process across the board, whether it's non union or union employees.
Speaker 13: So there's an equitable process to to this plan.
Speaker 13: But again, really taking into consideration is there work for for employees who are working at a facility that's closed or some of the functions have been reduced.
Speaker 13: So how did how do we manage through that?
Speaker 13: And then if there are employees who continue to work full time and that are non public safety, then applying a four hour furlough a week across the board, again, regardless if your management or frontline employees, it would be applied equally across the board.
Speaker 4: OK.
Speaker 4: Thank you for that.
Speaker 4: Thank you, Mr.
Speaker 4: Chair.
Speaker 2: OK, Council women, Cassette Sanchez.
Speaker 8: Thank you, Mr.
Speaker 8: Chair.
Speaker 8: So I just wanted to to reiterate the fact essentially that that $46,000,000 that we're looking at and that we're looking for solutions for that, if that only gets us through June, correct.
Speaker 8: Mary, you're on mute.
Speaker 3: Mr.
Speaker 3: Chairman, Councillor Cassutt Sanchez, yes, that is correct.
Speaker 3: This is the shortfall in these four months, March, April, May and.
Speaker 8: June.
Speaker 8: So anything that we do now, it's not going to be a long term solution.
Speaker 8: We're essentially just plugging the hole.
Speaker 8: So those fund balances and the general fund we have to.
Speaker 3: Have at least.
Speaker 8: 10% of our expenditures of our budgeted expenditures in reserve for other fund balances, do we have a required minimum or does it vary per balance?
Speaker 3: Mr.
Speaker 3: Chairman, Counselor Kasowitz Sanchez, there are some requirements with our Public Utilities funds, so Brad can go ahead and give a little bit more detail if he has that readily available.
Speaker 5: Thank you, Mary.
Speaker 5: Counselor.
Speaker 5: Chairman.
Speaker 5: Counselor.
Speaker 5: I spoke with Shannon Jones, the Public Utilities Director, on Friday.
Speaker 5: The water department has to have 365 days of operating expense in reserve, the wastewater plant or the wastewater enterprise and the environmental services enterprise.
Speaker 5: One has a 90 day reserve requirement of operations and the other has a 60 day reserve requirement requirement.
Speaker 5: And the Director Jones is going to be getting me that number here shortly sometime this week.
Speaker 5: So I know what I also know what their fund balance is and we're making sure that they have plenty of cat.
Speaker 8: In terms of our Public Utilities, have we started to, do we have information yet on whether we've taken a hit with people not being able to pay their utilities and what that's looking like?
Speaker 5: In speaking with Director Jones, we did reduce in our budget forecast and it's part of the $46 million shortfall.
Speaker 5: We reduced all utility revenues to 80% of expected remaining expected budget.
Speaker 5: We saw the newspaper article last week.
Speaker 5: He said it wasn't quite 37 in new delinquencies, but he felt very comfortable with 80%.
Speaker 5: And we're going to monitor it closely.
Speaker 5: We've asked them to start measuring their cash flows on a weekly basis, you know, how are they doing year over year.
Speaker 5: So we're very much on top of this and keeping track of their revenues to measure that in real time.
Speaker 8: That, you know, I know we're looking at furloughs right now and seeing how far that can take us, especially looking at other balances, what essentially would be, I don't even know if we have an answer for this yet, but our next step was looking at staff.
Speaker 8: Do we look at deeper furloughs?
Speaker 8: Are we, when, where are we going to start having to consider whether or when we lay off staff?
Speaker 8: How does this how does this process start to move forward?
Speaker 3: Mr.
Speaker 3: Chairman, Councillor Castle at Sanchez, that's a great question.
Speaker 3: That's one of those difficult decisions that I was referring to earlier.
Speaker 3: We given the revenue shortfall that we have, all options have to be on the table.
Speaker 3: Alexis Lotero, our Budget Officer has been monitoring actions in other cities.
Speaker 3: I believe there are about 2100 cities that are considering budget cuts this year because of the shortfall in their tax base, the shortfall in the tax revenue that's coming in.
Speaker 3: And those policy decisions that many other cities have already made do include additional furloughs further than where we have gone and have included a reduction in force and layoffs for their own staff.
Speaker 3: She actually just gave me an update that the mayor of LA has declared A fiscal emergency for the city.
Speaker 3: Many other in many cities are are have already implemented their furloughs have already gone towards the layoff options.
Speaker 2: On that point, Mary and Bernadette, the way the private sector is handling it right now is or immediately what the first things they did was they did layoffs because the employees that were laid off that that's where all the federal money went, it went to state and unemployment.
Speaker 2: So is that still an option?
Speaker 2: Is there?
Speaker 2: Will they continue to give unemployment money to the state, or will the state say, you know what, we can't handle any more layoffs or any more unemployment claims.
Speaker 13: Mr.
Speaker 13: Chairman, I'm not sure what will happen as far as at the state level with unemployment claims.
Speaker 13: I will say that we are doing research on how a furlough would affect employees and to what degree, specifically how many hours per week and and how that would affect our employees to ensure that we're providing them the most resources possible.
Speaker 2: So potentially A furloughed employee then, and this is the research you're going to do, if I hear you right, a furloughed employee could potentially get the hours they work from us plus unemployment for the shortfall.
Speaker 13: That's what we're researching right now.
Speaker 2: OK, thank you.
Speaker 2: OK, Councilwoman Casas Sanchez, go ahead.
Speaker 8: I don't think I have any additional questions at this time, but to echo what Councilwoman Romero Worth was saying about needing to move forward with advocating for city with the federal government as much as we can.
Speaker 8: And please let us know if there are additional opportunities, what else you see for us to be doing.
Speaker 8: I know that we have the resolution coming through, but any other opportunities that we have to to fight for our city in that sense, please let us know.
Speaker 8: Thank you so much.
Speaker 2: Councillor Lindell, did you have anything?
Speaker 7: Thank you, Chair.
Speaker 7: Yeah, I, I'm going to echo what a couple of people have said, and it's all uncertain.
Speaker 7: I appreciate some of the things that were laid out today on where we're going to save money and what we need to do.
Speaker 7: The number is astounding.
Speaker 7: For the next four months, it's almost 400,000 a day that we're facing.
Speaker 7: That's every day, seven days a week.
Speaker 7: And I would just encourage city family, if you're a person that ends up being furloughed to a three day, try to be as willing as you can to jump into some other positions that might be available and some work that you can do.
Speaker 7: I think that it's important for all of us to stay open to whatever possibilities are presented to us.
Speaker 7: I can very, very clearly tell anyone that will listen, this is extremely painful to us.
Speaker 7: It's painful to the city.
Speaker 7: And we don't know how much pain we're going to go through with this or for how long.
Speaker 7: I can tell anyone for sure that we're going to do the very best we can.
Speaker 7: And even at the very, very best we can, it's still going to be hard.
Speaker 7: And I think it's important that we're there for each other and support each other and that we look, I know this committee will look at these numbers very, very carefully.
Speaker 7: And, you know, this isn't done on a wing and a prayer.
Speaker 7: This is trying to go through these numbers as carefully as possible and getting us to where we have to go.
Speaker 7: We don't have, we don't have money.
Speaker 7: You look at that chart of GRT and you walk around town right now and we need to get realistic about this, that this is going to be very, very painful for us.
Speaker 7: And I know it's going to be painful for the directors trying to make decisions.
Speaker 7: Everybody had things that everybody that is there is essential and it's going to be very, very painful for this council.
Speaker 7: So on the fund saving measurements that we've come up with at 28.19, I would certainly hope that we would look at overtime everywhere.
Speaker 7: I mean, I know half millions a fair amount, but but certainly the police won't be having any festivals for overtime this summer and those kinds of things.
Speaker 7: And I suspect that that's a sizable amount of overtime.
Speaker 7: So maybe that's somewhere else that we could look and come up with a few $100,000.
Speaker 7: The the spending freeze at $25 million, that'll be very, very painful.
Speaker 7: I mean, we're talking about right down to office supplies.
Speaker 7: That's rough.
Speaker 7: So staff, I would say thank you very much.
Speaker 7: I realize that it is amazingly painful and unpleasant to go through these numbers and, you know, lay out the path of where we're headed for right now, but I hope we can they have enough time to go through these numbers so everybody feels like they have good input to it.
Speaker 7: And I do appreciate all the extra work the staff's putting into this.
Speaker 7: Thank you for letting me comment on it, Chair.
Speaker 2: Councilwoman Romero Wirth.
Speaker 6: I don't have anything to add, Mr.
Speaker 6: Chair.
Speaker 6: I just think that if, if you have personal relationships with the congressional delegation, I would certainly be calling them and their Staffs.
Speaker 6: And let's not wait for the resolution.
Speaker 6: But we, we know the number.
Speaker 6: We have some guesses, some some projections about how serious this is and we need to be making a lot of noise about that.
Speaker 6: We're going to need help.
Speaker 2: Councilwoman Casa Sanchez.
Speaker 8: I just wanted to put out a thank you to Miss McCoy and her team.
Speaker 8: Mary, I've had people describe you in the past as tight fisted and I don't think I have ever been so thankful that we have had a finance director who has really worked to, you know, to fill the coffers as much as you can.
Speaker 8: So thank you.
Speaker 8: I really, really appreciate that you have in the past been so, you know, on top of our funding and on top of the city and making sure that we are spending smartly and who knew that we would need it so much.
Speaker 8: So really thank you so much for that.
Speaker 2: Councilwoman Villarreal, did you have any last issues you wanted on this topic?
Speaker 4: No, just depressed because the city is our staff is like family.
Speaker 4: And so I'm hoping that if there's other possible essential jobs that people can move, transition into and be open about that, that's better than, you know, having furloughs for people that can't afford to, to support their families.
Speaker 4: So I'm just hopefully we can find out about the furlough piece if they're eligible for unemployment to make up that shortfall.
Speaker 4: I don't, I thought they were, but I don't know the insurance and outs of the unemployment eligibility.
Speaker 4: So hopefully we can figure that out, get the information to staff as soon as possible.
Speaker 4: That's all.
Speaker 4: Thank you.
Speaker 2: OK.
Speaker 2: Thank you.
Speaker 2: And I echo what the committee says.
Speaker 2: Thank you, staff.
Speaker 2: I know you all have been working between finance, legal, HR, all the departments overtime on this issue.
Speaker 2: And unfortunately the pain we're talking about is people and employees.
Speaker 2: When 70% of your budget is allocated to employees, when you take a hit like this, eventually that's where you're going to have to go with cuts.
Speaker 2: Hopefully we won't have to go very deep and far in that area.
Speaker 2: But I'm reminded of a county manager that I, I work for and she always said, you know, you should never allocate more than 50% of your general fund to employees to personnel and benefits.
Speaker 2: And now I know why, because when something like this happens, and unfortunately we're the council who stuck with it, that that's the place that we're going to have to look unless the federal government bails us out and makes us whole, which I will be calling our delegation and pleading with them to please help the city's, not just our city, but other cities in New Mexico and across the country.
Speaker 2: And when we talk about employees, I'm talking about all employees from department directors down, department directors, middle managers, everybody.
Speaker 2: We're all going to have to work together and, and in some cases, being a former department director, we all want to hold on to our vacant positions or our supplies or, or think war more essential than the other department.
Speaker 2: We all got a pitch in here and we all have to take an honest look at our our own departments, our own areas and see where we can cut and what sacrifices we could make.
Speaker 2: And we're all going to have to make them.
Speaker 2: But we will continue to to meet.
Speaker 2: We'll continue to talk.
Speaker 2: I would encourage the unions to step up to the plate and work with us because when money's gone, it's gone.
Speaker 2: Regardless of what union contracts say, regardless of what people think their rights are, payroll takes money.
Speaker 2: And when the money's not there, you can't make payroll.
Speaker 2: So hopefully we could all continue to work together.
Speaker 2: Thank you, Mary, once again and the rest of the staff.
Speaker 2: We have one more presentation that we need to get to.
Speaker 2: We can be brief, but it is about the capital projects.
Speaker 2: I think Public Works is going to have a lot of the Public Works committee is going to have a lot of work when it comes to our projects.
Speaker 2: So if Mr.
Speaker 2: Romero can please give us a quick overview on what the thinking is as far as our projects go and any potential savings we could make or adjustments that the Public Works Committee could start working on to bring to the Finance Committee and ultimately the Council to act on.
Speaker 2: Mr.
Speaker 2: Romero, are you still with us?
Speaker 11: Yes, yes, I am.
Speaker 11: Thank you, Chair.
Speaker 11: So yes, we've been looking at at all of our capital projects and what opportunity we could utilize that funding for, to help us with our current funding issues.
Speaker 11: All of our projects are already funded, whether it's through grants or through bonds that are have already been sold.
Speaker 11: So the, I guess the funding liability already exists for all, for all our projects that are bond funded because we have to pay back those bonds whether we do them or not.
Speaker 11: So the opportunity that we see for these bond or for all these projects, especially the bond projects is to prioritize them, reprioritize and hopefully free up some capital money that can maybe be diverted to other capitalizable expenses that we were recently purchasing out of the general fund.
Speaker 11: Some of those that come to mind and you know, we would be working with with Mary and Brad to see what those expenses are citywide.
Speaker 11: But I can definitely speak to some within our department.
Speaker 11: For instance, some of our signal operating supplies that we've been that we do need to operate our signals, those are could be capitalizable.
Speaker 11: So we can reprioritize some of these funds for that.
Speaker 11: So that way we, we don't have to draw towards the general fund.
Speaker 11: Other things are like vehicles again in our group, in our group we're down 1 snow plow that we need, we're down a bucket truck.
Speaker 11: I don't have any bucket trucks for my signal guys.
Speaker 11: We're just using a crane, things like that.
Speaker 11: So we'll be looking at how much money we can shave and then work with, with Mary and the committee's to see where we could divert that money to help with some expenses that we still need to to pay for, but that we may not have the money in the general fund to to accommodate.
Speaker 2: OK.
Speaker 2: Are there questions from the committee for Mr.
Speaker 2: Romero, Councilwoman Villarreal?
Speaker 4: Thank you.
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 4: I think the only concern I'm having about when I think about our capital projects and there is funding such as grants and bonds as Director Romita indicated, But to actually get those projects done, we need staff.
Speaker 4: And we've always had this issue to be able to manage our projects.
Speaker 4: And so I guess I'm asking John, if they've thought about that and that would be, that would determine what projects we prioritize based on project management and actually, you know, probably safety and some of those other aspects of to prioritize.
Speaker 4: But can you give us a better idea of how you're going to do that?
Speaker 11: No, that's a very good point.
Speaker 11: So we are, we will definitely include that in the prioritization of projects or actually in our project capacity to make sure that we have enough staffing to manage all our projects.
Speaker 11: There are things that I've I've thought of that could help make our staff more efficient.
Speaker 11: Some things are, you know, there's a lot of of staff time that is for my project managers that are spent elsewhere on staff.
Speaker 11: And so we're, I mean, I'll swear on staff, excuse me, I'll swear then on projects.
Speaker 11: And so I was going to work with the city manager and Mary to see if there's ways that we can make our working more efficient.
Speaker 11: You know, some things are like committees.
Speaker 11: The city has a lot of committees, a lot of committees.
Speaker 11: And a lot of my staff spends a lot of time dealing with the committees that they're required to staff.
Speaker 11: If we can somehow streamline those committees or even spread out how often they meet, it could free up a lot of my staff's time for working on projects as opposed to working on agendas and things like that.
Speaker 11: And again, these are minor committees.
Speaker 11: Of course, the major companies are definitely important, but there's some of these committees that we're not going to have money to be doing things that relate to those committees.
Speaker 11: So for the time being, there may not be a complete need for those committees until until our finances rebound.
Speaker 11: So things like that that we're looking at to see if we can improve our capacity.
Speaker 4: Thank you, John.
Speaker 4: That's all I have, Mr.
Speaker 4: Chair.
Speaker 2: OK, Mr.
Speaker 2: Romero, do you have an idea of what the what the state is going to do as far as projects that they had allocated funding to?
Speaker 2: Are they going to want the projects to be a certain percentage completed?
Speaker 2: I mean, it sounds like they're going to do a sweep across the state with cities and counties and take money away from certain projects.
Speaker 2: What what do you, what's your position?
Speaker 2: What's your opinion on that?
Speaker 11: So right now what we've tried to do in recent, so there's different types of funding.
Speaker 11: The legislative funding I think is the funding that's most at risk.
Speaker 11: We've tried to encumber as much as we can to this point responsibly encumber.
Speaker 11: We are going to be submitting a letter to the state asking that retain some funds.
Speaker 11: But I do think we've got to be realistic with that.
Speaker 11: We got to set up priorities.
Speaker 11: They're not going to let us keep all of our our funds.
Speaker 11: So we're going to have to definitely set up priorities with what the Legislature has given us with regards to federal funds.
Speaker 11: Granted it wasn't of this magnitude, but during the last recession it didn't affect funding that we had already had obligated.
Speaker 11: So for instance, a road project that's under designed, the design money is already obligated.
Speaker 11: We already have it locked and we're using that.
Speaker 11: The construction money that is programmed and it's maybe programmed for next fiscal year, the following that's not guaranteed in stone.
Speaker 11: So a lot of that in my area could be affected on, on the federal transportation bill that's sold, which might be less because of our current economy.
Speaker 11: So it it could be delaying a lot of those projects which we lose those projects, but then we'll gain capacity staff wise to help with other projects.
Speaker 11: But it's a very good question and we are trying to put together a prioritization of those projects.
Speaker 11: We're going to run those through the the city manager, the finance director and the mayor to see what priorities, if any, they want to present to to the state and see what we can retain.
Speaker 2: OK.
Speaker 2: And I assume that would that would go to the Public Works Committee also before it goes OK, anything else from members of the committee for Mr.
Speaker 2: Romero?
Speaker 11: I had a spreadsheet of most of our projects.
Speaker 11: I don't know if you guys would want to take a look at that real quick.
Speaker 2: Yeah, that'd be great if you could put it on on the screen if you have that ability.
Speaker 11: Yeah.
Speaker 11: Let me see if I can do this.
Speaker 11: OK.
Speaker 11: So this is the majority of our projects, we're still working on this.
Speaker 11: It's not prioritized the light and I apologize, the colors don't contrast as much as maybe they could.
Speaker 11: But the the yellowish, the the light yellow or light orange, excuse me, those are all grant related projects.
Speaker 11: So they're pretty much they are what they are.
Speaker 11: They're for those projects.
Speaker 11: We can't do anything.
Speaker 11: We can't move that money anywhere with the exception of maybe losing the money in future years fiscal years.
Speaker 11: The orange ones are some of our bond funded projects that we are currently working on.
Speaker 11: Those are the ones that I think and they're GIR T-bond the majority of them.
Speaker 11: Those are the ones that I think we have the opportunity to may be re appropriate for other operation related, but capitalizable expenses, the GO bond money, you know those are very limited on what we could use those for.
Speaker 11: Again, they went to the voters for a certain purpose.
Speaker 11: So we can definitely see if it's if there's some flexibility with those.
Speaker 11: But those ones are a little more are more earmarked towards a specific purpose, the things and why, granted they're not color-coded, they're just very various projects that are actually funded with funds that are very limited in their use.
Speaker 11: For instance, the Camino and Char, the roundabout, the Areo Chamiso crossing study and we also have one that's partially funded with it, the Agua free of South Meadows intersection project.
Speaker 11: Those are heavily funded by our impact fees and those roadway impact fees that are accrued from developers, those are specific to being spent on road projects that expand capacity.
Speaker 11: So I don't think we could use those to to divert them to other areas.
Speaker 11: And then another big one is that parking, that parking revenue control system, that project is pretty much almost done.
Speaker 11: There's a small component at the end to get it operational that was funded through a loan that's that's already been received that, you know, we're smitting reimbursement on.
Speaker 11: So that one we're probably going to look to see all the way through, especially for when we rebound out of this and things start opening up.
Speaker 11: It'll allow our parking garages to be up and running collecting revenue and in a way that reduces the amount of staffing needs.
Speaker 11: So we're going to want to keep that one moving forward.
Speaker 11: But during the next meeting, we'll try to put this together in more of a of a prioritization and maybe better organize it so that way it's clear for you guys on what money is more discretionary that we can, we could look at reappropriating for different things.
Speaker 2: OK.
Speaker 2: And and just make sure Mr.
Speaker 2: Romero, that the Public Works Committee makes the ultimate recommendation.
Speaker 2: And so I'd ask that that work be done there first and then you bring us their their prioritized list because that's really their purview.
Speaker 2: And I don't want to, you know, Chairman Rivera is well aware of the financial situation we're facing as a city.
Speaker 2: And I think that that committee is in good hands with him.
Speaker 2: And they this, that's where a lot of this heavy lifting should be done is with that committee.
Speaker 11: OK.
Speaker 11: Yeah, definitely.
Speaker 2: OK.
Speaker 2: Any other questions from the committee for Mr.
Speaker 2: Romero Let.
Speaker 11: Me unshare my screen.
Speaker 11: I apologize.
Speaker 11: There we go.
Speaker 2: OK.
Speaker 2: Then that will conclude our presentations under our agenda for this evening.
Speaker 2: Matters from staff.
Speaker 2: Miss McCoy, is there anything else you want to share with us?
Speaker 2: You're on.
Speaker 2: You're on mute.
Speaker 3: No additional matters from the staff at this time.
Speaker 2: OK, matters from the committee.
Speaker 4: Mr.
Speaker 2: Chair Councilwoman VRL and then Romero Wirth.
Speaker 4: Sorry about that.
Speaker 4: I was trying to figure out what is the are we hearing the resolution tonight or is this the introduction?
Speaker 2: I believe it will be introduced at at our next council meeting.
Speaker 2: Is that right, Miss McCoy?
Speaker 3: Mr.
Speaker 3: Chairman, Councillor Villarreal, we will check on the timing of that and get back to you.
Speaker 4: I thought we were using it tonight, Mr.
Speaker 4: Chair.
Speaker 2: Yes, Councilwoman.
Speaker 6: I think Jesse said it was going to be introduced at the next council meeting next week.
Speaker 2: OK.
Speaker 4: For some reason, I thought we were introducing it tonight so that we could vote on it, the council meeting on Wednesday.
Speaker 4: But that's fine.
Speaker 4: It's a little bit.
Speaker 4: It might be a moot point by the time we get to next week.
Speaker 4: There's some language that I want to add.
Speaker 4: So would that just, would I just let Jesse know?
Speaker 2: Yeah, I believe so.
Speaker 2: OK.
Speaker 4: Thank you.
Speaker 2: OK.
Speaker 2: Anything else from the committee?
Speaker 6: Mr.
Speaker 6: Chair, two things.
Speaker 6: So Jesse's e-mail actually says it should be introduced this evening and that it would be heard at Governing Body next next week.
Speaker 2: OK, it's not on my agenda.
Speaker 2: Do we need it to be on the agenda to introduce it?
Speaker 6: I don't think so.
Speaker 2: OK.
Speaker 2: Did you want to introduce it?
Speaker 6: Sure.
Speaker 6: I'll introduce the resolution.
Speaker 6: Hold on a resolution.
Speaker 1: We do need the resolution.
Speaker 6: I've got it right here.
Speaker 1: Can you e-mail it to me?
Speaker 6: Yes, OK.
Speaker 6: A resolution urging New Mexico's congressional delegation to seek federal funding relief for the City of Santa Fe and other small municipalities to address and recover from the COVID-19 pandemic and to continue the delivery of quality services to the residents and employment for the workers.
Speaker 6: And also, I just got an e-mail.
Speaker 6: I got some sort of message on my phone just being Aaron Mcsherry says it's supposed to be introduced tonight.
Speaker 6: So with that I will introduce this resolution for consideration next week.
Speaker 2: OK.
Speaker 2: And Councilwoman Villarreal, did you want to introduce your amendments now or do you want to wait until Council?
Speaker 4: I may just tell Jesse that they're not major.
Speaker 4: I just I'll e-mail him about language.
Speaker 2: OK, so has the item then been introduced?
Speaker 2: We don't.
Speaker 2: We just need to read the title.
Speaker 6: That's correct.
Speaker 6: OK, Chair, one other thing.
Speaker 2: Yes.
Speaker 6: If we're done with that, so our next meeting I think is May 4th and that's the same date as the Midtown meeting, is that right?
Speaker 2: Miss McCoy, is that correct?
Speaker 3: Mr.
Speaker 3: Chairman, our next meeting is on May 4th.
Speaker 2: OK.
Speaker 2: So are we going to have to reschedule the Finance Committee meeting or do we want to meet earlier in the day?
Speaker 2: What do we want to do?
Speaker 4: Is the May 4th date set for the Midtown discussion?
Speaker 6: Yeah, they just the on my Twitter feed, the city sent out notice that that's the date for the for the Midtown special Council meeting because I went to calendar and the Finance Committee meetings already there.
Speaker 6: So I don't know whether they're thinking that's earlier or later or or what, but we got to figure that out.
Speaker 6: Also, just one other quick thing.
Speaker 6: Aaron says that we'll waive the rules at the governing body RE introduction so that the introduction tonight for the resolution on urging the congressional delegation to act will work.
Speaker 6: So there there's a there's a parliamentary procedure that we'll have to do when we get to the governing body.
Speaker 3: And Mr.
Speaker 3: Chairman, Aaron also just text and said that we do not have a time set for the Midtown meeting just yet.
Speaker 3: So we will be circling back with you with the schedule for May 4th.
Speaker 2: OK, yeah, maybe the Midtown meeting could be at 6:00 PM and we can meet for an hour before that.
Speaker 2: That's just an idea, but I don't know what the rest of the committee thinks.
Speaker 6: Well, this meeting, Mr.
Speaker 6: Chair, has taken us 2 1/2 hours, so given the financial situation we're in, we just better make sure that we're allowing enough time for the important work of this committee and also the important work of that special council meeting.
Speaker 2: Yeah.
Speaker 2: So, OK, quite well taken.
Speaker 2: Miss McCoy let's you and I will try to figure out a schedule and I'll contact the other members of the Finance Committee to see what works for everybody.
Speaker 4: Mr.
Speaker 4: Chair.
Speaker 2: Yes.
Speaker 4: So why don't we keep finance and actually think of another date for the midtown date or midtown meeting?
Speaker 2: What was the Midtown meeting already sent out to the public?
Speaker 6: Though it's already been sent to the public, let's do this offline.
Speaker 6: Somebody's going to have to figure it out.
Speaker 2: OK.
Speaker 2: Then what?
Speaker 2: We'll we'll start working on that.
Speaker 2: Any other matters from the committee under matters from the committee chair?
Speaker 2: The only thing I have is as you continue to come up with questions or suggestions or ideas regarding the budget and budget cuts and please e-mail them to myself and Miss McCoy and we will start a running list and we will start distributing the answers to these questions as we get the research done for them.
Speaker 2: So other than that, that's all I have if there's nothing else and then we are adjourned.
Speaker 2: Thank you.
Speaker 2: Good night.
Speaker 1: Good night.
During a recent meeting led by Chairman Roman Romana Beta, participants addressed several critical issues concerning the City of Santa Fe's health insurance renewal and budget update, alongside broader fiscal management challenges facing the city. The meeting agenda included an amendment to realign topics, specifically moving the health insurance renewal to item 8A and the budget update to item 8B. This change was approved alongside the consent agenda and previous meeting minutes through roll call votes, confirming the presence of all necessary councilors for the meeting.
The meeting began with a presentation on the City of Santa Fe's health insurance renewal, focusing on the proposal from Aon Consulting. The key aspects highlighted were an overall 9.4% increase in health program costs, attributed to rising administrative and stop-loss fees, while the dental program remained unchanged. The discussion centered on the city's contributions versus employee payroll deductions, detailing the current and projected costs and incremental changes in dollar amounts.
Various participants engaged in discussions surrounding potential impacts of healthcare costs, emphasizing the stability of dental plans and the structural revisions in life insurance benefits. There were inquiries about the high premium plan for union members and comparisons of current benefits with New Mexico's state plans. Proposed changes in the premium plan, including considerations of deductibles, coinsurance, and co-pays, were deliberated to address a projected 9.4% increase.
The discussion then shifted towards procedural updates regarding city finances amid extraordinary public health challenges. Miss McCoy presented an update on the Fiscal Year 2020 budget, highlighting strategic responses to the public health emergency, such as closing facilities and addressing unemployment rises and economic impacts on the hotel industry. The fiscal management discussion covered maintaining bond ratings, managing gross receipts tax reductions, and addressing estimated shortfalls of $46 million in all funds and $14 million in the general fund.
The conversations emphasized strategic financial measures, including a hiring freeze, potential furloughs, and cuts to overtime to achieve necessary savings. Discussions explored accessing existing funds, reallocating resources from bond projects, and potential state assistance. Notably, federal support through programs like the CARES Act was deemed critical.
Speaker 11 discussed prioritizing and reallocating bond and impact fee funds, ensuring sufficient management capacity to execute essential projects. Efforts to streamline committee operations for improved efficiency were also addressed, acknowledging that temporary suspensions might be necessary until economic recovery is underway.
Overall, the meeting highlighted a collaborative effort to navigate the city through considerable fiscal challenges due to the COVID-19 crisis, balancing financial prudence with the need to maintain essential services. Continuous dialogue with federal and state entities, efficient resource management, and strategic legislative advocacy were underscored as critical steps forward. The meeting concluded without further business, but with plans for continued discussions and resolutions concerning the evolving financial landscape and its impact on city operations.