PRESENTATIONS

[1. Council consider a resolution authorizing the City Manager to execute Final Change Order No. 1, accept maintenance, and authorize final payment to Texas Materials Group Inc., a CRH Company, for the Street Pavement Preservation Citywide – Phase II Project.]

THANK YOU. MAYOR. COUNCIL, CONSIDER RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE FINAL CHANGE ORDER NUMBER ONE EXCEPT MAINTENANCE AND AUTHORIZED FINAL PAYMENT TO TEXAS MATERIALS GROUP INCORPORATED A CR H COMPANY FOR THE STREET PAVEMENT PRESERVATION CITYWIDE PHASE TWO PROJECT, AND IT COMES WITH THE RECOMMENDATION OF APPROVAL OF THE RESOLUTION. IS THERE A MOTION FOR ITEM NUMBER ONE? SECOND, THERE IS A MOTION AND A SECOND FOR APPROVAL OF ITEM NUMBER ONE. IS THERE ANY DISCUSSION? ALL THOSE IN FAVOR OF APPROVING ITEM NUMBER ONE? PLEASE SIGNIFY BY SAYING I. ANY OPPOSED THE MOTION IS CARRIED.

[2. Council consider a resolution authorizing the City Manager to execute Change Order No. 2 to the contract with SETEX Construction Corp., for the Fannett Road Sidewalk Improvement Project.]

MR. CITY MANAGER, MAY WE HAVE THE READING OF ITEM NUMBER TWO? COUNCIL, CONSIDER RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE. CHANGE ORDER NUMBER TWO TO THE CONTRACT WITH TEXAS CONSTRUCTION CORPORATION FOR THE FANNETT ROAD SIDEWALK IMPROVEMENT PROJECT. AND IT COMES WITH THE RECOMMENDATION OF APPROVAL OF THE RESOLUTION. IS THERE A MOTION FOR ITEM NUMBER TWO? MOVE TO APPROVE. IS THERE A SECOND? SECOND THERE IS A MOTION AND A SECOND FOR APPROVAL OF ITEM NUMBER TWO. IS THERE ANY DISCUSSION? ALL THOSE IN FAVOR OF APPROVING ITEM NUMBER TWO? PLEASE SIGNIFY BY SAYING AYE. AYE. ANY OPPOSED? THE MOTION IS CARRIED. MR. CITY

[3. Council to consider a resolution rescinding Resolution No. 25-156, previously awarding a contract to Volta LLC, for the Wastewater Treatment Plant Power Distribution Switchgear Building Pre-Purchase Project, and to authorize the City Manager to award a contract to Blackstar Diversified Enterprises, LLC, of New Orleans, Louisiana, in the amount of $2,290,596.00.]

MANAGER, MAY WE HAVE THE READING OF ITEM NUMBER THREE? COUNCIL TO CONSIDER RESOLUTION RESCINDING RESOLUTION NUMBER 20 5-156. PREVIOUSLY AWARDING A CONTRACT TO VOLTAR LLC FOR THE WASTEWATER TREATMENT PLANT. POWER DISTRIBUTION, SWITCHGEAR BUILDING PRE-PURCHASE PROJECT AND TO AUTHORIZE THE CITY MANAGER TO AWARD A CONTRACT TO BLACK STAR DIVERSIFIED ENTERPRISES, LLC OF NEW ORLEANS, LOUISIANA, AND THE AMOUNT OF $2,290,596. AND IT COMES WITH THE RECOMMENDATION OF APPROVAL OF THE RESOLUTION. IS THERE A MOTION FOR ITEM NUMBER THREE? MOVE TO APPROVE. IS THERE A SECOND? SECOND THERE IS A MOTION AND A SECOND FOR APPROVAL OF ITEM NUMBER THREE. IS THERE ANY DISCUSSION? YES. YES. COUNCILMAN HILLIARD, IF YOU TURN YOUR MIC ON. THANK YOU. CAN CAN WE GET A LITTLE CLARIFICATION. WHY WHY WHY

[00:50:03]

WE'RE DOING THIS. SORRY I MISSPOKE. IT WAS FOR ITEM TWO. NUMBER THREE. SO YOU DON'T HAVE TO WORRY ABOUT THAT. SO WE RECEIVED THE BIDS FROM WHEN WHEN THEY WERE OPENED. AND WE WERE WE HAD RECOMMENDED AWARD TO VOLTA. AND AS WE WERE WORKING THROUGH THE EXECUTION OF THE AGREEMENTS. AND SO THAT'S WHEN THEIR, THEIR SURETY TO COME THAT THEY CAN PERFORM THE PROJECT AND THEIR CONSTRUCTION BONDS. PER THE TERMS OF THE CONTRACT. WE WERE NOTIFIED THAT THEY WERE NOT GOING TO BE ABLE TO FULFILL THOSE TERMS. AND SO PER THE TERMS OF THE CONTRACT, THAT IS WHERE WE HAD TO MAKE THE RECOMMENDATION TO WITHDRAW THAT AWARD AND PROCEED WITH BLACK STAR DIVERSIFIED ENTERPRISES. AND THEY HAVE CONFIRMED, BLACK STAR HAS CONFIRMED THAT THEY CAN MEET ALL OF THE TERMS OF THE AGREEMENT AS AS SUBMITTED.

THANK YOU. WELCOME. ANY OTHER QUESTIONS OR DISCUSSION? ALL RIGHT. ALL THOSE IN FAVOR OF APPROVING ITEM NUMBER THREE, PLEASE SIGNIFY BY SAYING I. AYE. ANY OPPOSED? THE MOTION IS

[PUBLIC HEARING]

CARRIED. MR. CITY MANAGER, WOULD YOU PLEASE TAKE US INTO THE FIRST PUBLIC HEARING? COUNCIL. COUNCIL TO CONSIDER PUBLIC HEARING TO RECEIVE COMMENTS ON THE 2024 CONSOLIDATED ANNUAL PERFORMANCE EVALUATION REPORT, WHICH IS THE CAPER? ALL RIGHT. THANK YOU.

AND AT THIS POINT, WE WILL OPEN THE PUBLIC HEARING. GOOD AFTERNOON. I'M JESS PRINCE, THE COMMUNITY SERVICES MANAGER HERE AT THE CITY. THIS IS AN ANNUAL REPORT THAT WE ARE REQUIRED TO TURN IN TO HUD. AND WHAT IT'S DOING IS TRACKING THE METRICS THAT ARE ASSOCIATED WITH OUR ANNUAL ACTION PLAN. AND WITH OUR FIVE YEAR CONSOLIDATED PLAN, WE HAVE TO HOLD A PUBLIC HEARING TO COLLECT COMMENT FOR 30 DAYS. AND THIS REPORT WILL THEN BE SUBMITTED BY STAFF ON SEPTEMBER 30TH. AND SO WHAT THIS IS DOING IS CAPTURING ALL PROGRESS RELATED TO THE GOALS AND OUTCOMES THAT WERE OUTLINED IN OUR ANNUAL ACTION PLAN, WHICH WAS APPROVED BY COUNCIL BACK IN MAY. THIS COVERS THE BENEFICIARIES THAT RECEIVE FUNDING FROM ALL OF OUR LINE ITEMS IN THE BUDGET. IT COVERS THE RESOURCES THAT ARE MADE AVAILABLE EACH YEAR WITH BOTH OUR CDBG AND OUR HOME GRANT. IT ALSO OUTLINES THE GEOGRAPHIC DISTRIBUTION OF THOSE FUNDS AND WHAT CENSUS TRACTS THROUGHOUT THE CITY ARE RECEIVING THE MONEY, AND WHICH LOW INCOME HOUSEHOLDS. ALL OF THE ACTIVITIES THAT ARE CARRIED OUT WITH THESE FUNDS HAVE TO BE LINKED TO A NATIONAL OBJECTIVE, SUCH AS A LOW INCOME HOUSEHOLD. AND SO WHEN WE HAVE OUR PLAN EACH YEAR, WE HAVE A LIST OF GOALS AND OUTCOMES. THESE INCLUDED FOR 20 FOR AFFORDABLE HOUSING, OUR CLEARANCE AND DEMOLITION ACTIVITIES OF BLIGHTED STRUCTURES, HOUSING REHABILITATION PROGRAM, WHICH IS OUR MOST POPULAR AND ALSO MOST FUNDED PROGRAM. AND THEN OUR PUBLIC FACILITIES AND PUBLIC SERVICES LINE ITEMS. SO THIS REPORT HAS BEEN AVAILABLE ON OUR WEBSITE FOR 30 DAYS, AND IT DOES A BREAKDOWN OF ALL THE HOUSEHOLDS THAT WERE PROJECTED TO BE SERVED BY EACH OF THOSE ITEMS, AND THEN COMPARES IT TO THE NUMBER THAT ACTUALLY WERE.

OVERALL, WE'RE DOING AN EXCELLENT JOB OF MEETING ALL THOSE GOALS AND OBJECTIVES. AND AGAIN, THIS IS A REPORT THAT'S INPUT INTO HUD'S METRIC SYSTEM CALLED IDIS. BUT YOU CAN VIEW THE REPORT ONLINE AND IT WILL STAY THERE EVEN AFTER IT IS SUBMITTED. THANK YOU. I DON'T HAVE ANYONE THAT WANTS TO SPEAK. MAYOR. ALL RIGHT. THAT PUBLIC HEARING IS NOW CLOSED. AND WE

[PUBLIC HEARING]

WILL WE MOVE. CAN WE MOVE INTO THE NEXT PUBLIC HEARING, MR. CITY MANAGER? YES, MAYOR.

COUNCIL TO CONDUCT A JOINT PUBLIC HEARING ON THE PROPOSED FISCAL YEAR 2026 BUDGET AND THE PROPOSED FISCAL YEAR 2026 CAPITAL PROGRAM. AND IF YOU MAY, I COULD YEAH, THE PUBLIC HEARING IS NOW OPEN. OKAY. WE'LL GET SOME SLIDES UP WHILE WE'RE GETTING THOSE SLIDES UP.

WE'VE GONE THROUGH SOME MONTHS OF BUDGET PREPARATION. WE'VE HAD A FEW WORKSHOPS, I THINK AT LEAST THREE WORKSHOPS. WE HAD A BUDGET PRESENTATION BY MYSELF LAST IN AUGUST ON THIS. AND TODAY WE'RE COMING TO YOU FOR CONSIDERATION OF APPROVING BUDGET, ADOPTING A TAX RATE, AND HOLDING THIS PUBLIC HEARING ON THE BUDGET. SO WE WE ARE HERE FOR THAT. COULD WE GO TO

[00:55:01]

THE NEXT SLIDE? AGAIN, WE MENTIONED THESE THINGS FOR SURE. YOU ALSO SET THE TAX RATE TODAY.

YOU ADOPTED A PROPOSED TAX RATE LAST MEETING. THIS TIME YOU GET TO SET THE TAX RATE ON TODAY.

NEXT SLIDE. AFTER THE LAST MEETING THERE WAS A LOT OF FEEDBACK FROM CITY COUNCIL, FEEDBACK FROM PEOPLE ON THINGS WITH THE BUDGET. I ENCOURAGE THAT. MATTER OF FACT, I SAID I WANTED TO HAVE THAT FEEDBACK FROM YOU. SO I APPRECIATE THOSE OF YOU THAT GAVE ME FEEDBACK ON THAT PARTICULAR DOCUMENT. AND WE INCORPORATED MANY OF THOSE CHANGES INTO THIS BUDGET.

BUDGET FOR YOUR ADOPTION. AND ON HERE YOU'RE LOOKING AT THE SLIDE. ONE OF THE THINGS THAT REALLY CAME OUT FROM SOME OF YOU IS YOU WANTED TO SEE A HIGHER FUND BALANCE. YOU WANTED TO SEE MORE DOLLARS IN RESERVE. SO WE DID THAT. YOU WANT TO CONSIDERATION FOR SENIOR CITIZENS. WE HAVE SENIOR CITIZENS OUT THERE THAT PROPOSALS FROM COUNCIL WANTS FOR MAYBE A TAX ABATEMENT OR WATER ABATEMENT. WE WERE ABLE TO ADDRESS THAT ISSUE. AND THEN LOW RESIDENTIAL WATER RATES. THE WATER RATE STUDY CALLED FOR AN INCREASE. SOME OF YOU DIDN'T WANT THE WATER RATE INCREASE. SO WE WORKED OUT A WAY TO WHERE WE DID MORE. WE PROVIDED SOME RELIEF FOR RESIDENTIAL PROPERTIES AND PUTS A BIT OF AN INCREASE ON COMMERCIAL PROPERTIES. THEN THERE WAS A QUESTION OF SUSTAINABILITY. IT'S LIKE, HOW CAN WE MAINTAIN THIS BUDGET INTO THE FUTURE? YOU KNOW, WE ARE HAVING QUITE A FEW INCREASE. WE HAVEN'T INCREASED THE PERSONNEL. AND HOW HOW ARE WE GOING TO SUSTAIN THAT? SO WE'VE ADDRESSED SOME THINGS WITH THAT. AND THEN TWO, YOU WANTED TO YOU WERE YOU WERE VERY SENSITIVE TO THE FACT THAT THE CITY IS LOOKING AT A BOND ELECTION, AND YOU WANTED TO DO SOME THINGS TO NOT CREATE HARDSHIPS OR PUT MORE ON OUR CITIZENRY. WHAT DOES LOOKING AT ASKING THEM TO CONSIDER BOND ELECTION. SO WE WERE LOOKING AT THAT TOO. NEXT SLIDE. AND THIS IS SOME OF THE BUDGET ADJUSTMENTS WE MADE SINCE THAT LAST MEETING THERE. WE LOOKED AT SOME THINGS. WE REDUCED EXPENDITURES BY $3.1 MILLION, WHICH INCREASES THE FUND BALANCE TO 4 TO $1,722,082. WE DID THAT THROUGH BASICALLY TWO MAIN MOVES IN GETTING THAT DONE WAS THE FINANCING AND FINANCING SOME PURCHASES AND STILL PAYING CASH. WE HAD PROPOSED IN THE ORIGINAL DOCUMENT TO PAY 3 MILLION PLUS IN CASH FOR CAPITAL ITEMS FOR THE CITY. YOU CHOSE. YOU WANTED TO HIRE FUND BALANCE. SO WE JUST SAID WE CAN FINANCE THOSE THINGS AND PAY A YEARLY PAYMENT FOR A PERIOD OF TIME AND KEEP MORE CASH ON HAND. YOU KNOW, EITHER YOU CAN FINANCE SOMETHING, YOU CAN PAY CASH. AND THE FEEDBACK I GOT, YOU PREFER IT TO HAVE THE HIGHER FUND BALANCE. SO WE DID THAT. THE CHILLER REPLACEMENT FROM THE MAIN LIBRARY THAT WAS $728,000, A PIECE OF EQUIPMENT THERE. AND SO WE DECIDED TO PUT THAT OFF AND, AND NOT MAKE THAT PURCHASE THIS YEAR. SO THAT GAVE US THE ACCUMULATED AMOUNT OF DOLLARS WE WERE ABLE TO INCREASE FUND BALANCE WITH. BUT AND ALSO DECREASE EXPENDITURES. ONE GREAT THING WE WERE ABLE TO DO IS PUT A FREEZE PROPOSALS IN THIS PROPOSAL IS TO PUT A FREEZE ON SENIOR CITIZENS WATER RATES TO WHERE THROUGHOUT THIS RATE STRUCTURE, THERE WILL NOT BE ANY INCREASE FOR SENIOR CITIZENS ON THEIR WATER RATES.

WHATEVER IT IS NOW, THAT'S WHAT IT WILL REMAIN, AND WE'RE VERY GLAD TO DO THAT. WE'RE VERY PROUD TO DO THAT. SOME OF YOU WANTED THAT IN THIS BUDGET. SO WE WERE ABLE TO DO THAT AND AND ABLE TO WORK THROUGH THAT ISSUE. WE INCREASED THE WATER FUND BALANCE RATE STUDY. GRADY READ RECOMMENDED THAT THE CITY GO TO A 20% FUND BALANCE ON WATER RATHER THAN 15. THOUGHT THAT WAS A BIT LOW. SO THIS BUDGET CALLS FOR 20% FUND BALANCE REQUIREMENT AND THE GENERAL FUND BALANCE, AFTER WHAT WE'VE DONE NOW IS NOW 25.7%, A 25.7% FUND BALANCE. AND AND WATER IS NOT 30.2%. SO THOSE NUMBERS THAT ARE HEALTHY PLACE NEXT SLIDE. JUST GAVE A LITTLE BIT INFORMATION ABOUT GENERAL FUND HIGHLIGHTS. THERE YOU SEE THE AMOUNT OF REVENUES WE BROUGHT IN AND WHAT WE'RE PROJECTING TO BRING IN NEXT YEAR. AND THE GREAT THING ABOUT THIS SLIDE IS THAT WE'RE ABLE TO DO ALL OF THIS AND PUT THIS BUDGET TOGETHER WITHOUT A TAX RATE

[01:00:05]

INCREASE. THE TAX RATE IS PROPOSED TO SAY THE SAME, EXACTLY THE SAME. IT IS 0.6596%, WHICH IS $0.03 BELOW WHAT THIS COUNCIL COULD HAVE SET A TAX RATE. SO YOU SET IT AT 0.65 AND HAD THE ABILITY TO GO UP AND YOU DIDN'T. SO WE WE WERE PRUDENT. AND IN DOING THAT. AND THIS THIS THIS IS NOT JUST THIS YEAR. THIS HAS BEEN A HISTORICAL THING TREND WITH THE CITY OF BEAUMONT. THIS IS THE FOURTH OR FIFTH YEAR THAT THE TAX RATE HAS REMAINED STEADY OR AT BELOW THE VOTER APPROVAL RATE. AND PROPERTY VALUES HAVE GROWN BY MORE THAN 25% SINCE 2022. SO WE OFTEN HEAR THAT, YOU KNOW, BEAUMONT'S ECONOMY IS SOMEWHAT DEPRESSED, BUT THERE ARE MANY INDICATIONS THAT SAID, IT'S NOT. YOU'VE GOT A 25% INCREASE IN PROPERTY VALUE SINCE 2022, AND WE WERE STILL ABLE TO GET WITH THIS BUDGET TO BE ABLE TO TO FUND THE EXPENDITURES AND CAPITAL RESERVES ITEM THAT'S NEEDED, THE THINGS THAT THE POLICE DEPARTMENT TRULY NEEDS, LIKE VEHICLES, MOTORCYCLES, OTHER EQUIPMENT, ALSO FIRE TRUCKS, RECREATION EQUIPMENT, ETC. IT, TECHNOLOGY, TECHNOLOGY, INFRASTRUCTURE AND COST OF LIVING ADJUSTMENT FOR THE CIVILIAN EMPLOYEES HERE. WE WERE ABLE TO DO THAT AT THE 3% CIVILIAN EMPLOYEE AMOUNT. THAT'S FOR ALL CIVILIAN EMPLOYEES OUT THERE. BUT WE ALSO NOT ONLY THE 3%. WE DID THE THIRD YEAR OF THE PHASE, THE PHASE THREE OF THE COMPENSATION STUDY. SO THOSE DOLLARS WERE ALSO PUT INTO SELECTED JOB DESCRIPTIONS AND SELECTED EMPLOYEES IN THOSE JOB DESCRIPTIONS TO GET THEM AT AT LEAST AT LEAST A MINIMUM REQUIREMENT. OUR GOAL WAS TO GET EVERYBODY TO MINIMUM AND THEN WORK TOWARD GETTING EVERYBODY TO MEET MID PAY STRUCTURES. SO THIS GETS EVERYBODY TO THE MINIMUM PAY STRUCTURE. YOU KNOW, WHEN I GOT HERE WE HAD PEOPLE WEREN'T MAKING $10 AN HOUR. THEN AFTER I GOT HERE WE GOT EVERYBODY TO $15 AN HOUR. AND NOW THAT GETS PEOPLE UP TO EVEN GREATER DOLLARS TO AROUND AT LEAST $20 AN HOUR IS LIKE THAT. SO THIS THIS HAS BEEN GREAT. THIS IS GREAT FOR US. AND JUST PAY EQUITY. JUST PAY EQUITY ACROSS THE DIFFERENT DEPARTMENTS, THE DIFFERENT PEOPLE. CONSTRUCTION. NEXT SLIDE. WATER UTILITIES. I MENTIONED ABOUT THE NO RESIDENTIAL WATER RATE INCREASE FOR THE FIVE EIGHT INCH LINES METER. AND WE HAD TO DO IT THAT WAY BECAUSE THERE ARE JUST A FEW RESIDENTIAL METERS THAT'S LARGER THAN 5/8, WHICH IS ABNORMAL, BUT WE'RE KEEPING THOSE MONTHLY BILLS STABLE AND WE'RE MAKING, AGAIN, THINGS BETTER FOR OUR CITIZENS AND NOT PUTTING MORE DOLLARS ON THEM. AS THE CITY GROWS AND THE INFRASTRUCTURE GROWS, I MENTIONED THE CITIZEN SENIOR CITIZEN, WATER RATES FROZEN THROUGHOUT. WE WOULD JUST ONCE WE IDENTIFY THAT WE HAVE LISTINGS OF SENIOR CITIZENS THAT OWN OUR WATER SYSTEM, WE BE ABLE TO IDENTIFY THOSE AND WE'LL BE ABLE TO FREEZE THOSE RATES. AND THEY WON'T BE ABLE THEY WON'T HAVE TO PAY MORE. AND AGAIN, THIS WATER UTILITY IS A FUND BALANCE REQUIREMENT WILL GO FROM 15% TO 20%. NEXT SLIDE. FUND BALANCE IS A GOT A LOT OF FEEDBACK ON FUND BALANCES. I JUST WANT TO TALK ABOUT THAT FOR A WHILE, WHICH IS BASICALLY RESERVES. PEOPLE ASK WHAT'S FUND BALANCE IS RESERVES. AND THIS GIVES A SNAPSHOT OF YOUR MAIN FUNDS. HERE AT THE CITY YOU HAVE THE GENERAL FUND, WHICH BASICALLY YOUR OPERATIONS AND MAINTENANCE. AND THEN YOU HAVE ENTERPRISE FUNDS OF SOLID WASTE AND WATER UTILITIES, WHICH IS THE GENTLEMAN MENTIONED. YOU DON'T HAVE ANY ELECTRIC COMPANY, BUT YOU DO HAVE A WATER COMPANY, AND YOU HAVE A SOLID WASTE COMPANY WHICH MAKES MONEY FOR THE CITY. AND WE PROVIDE THOSE SERVICES. SO THE GENERAL FUND AT 20%, AS I MENTIONED, THAT'S GOING TO GIVE YOU A FUND BALANCE OF 41,000,007 22 AND THAT'S 9 MILLION ABOVE WHAT'S REQUIRED FOR THAT FUND FOR THE FOR THE BUDGET YEAR, SOLID WASTE IS 4 MILLION FOR APPROXIMATELY 1,000,009 OVER REQUIRED. AND WATER UTILITIES, WHICH IS GOING UP TO 20% AT 19 MILLION, WHICH IS SIX. SO YOU'RE GOING TO HAVE A TOTAL BALANCE OF 65, ALMOST $66 MILLION IN RESERVE DOLLARS. THAT'S THAT'S THAT CITY COUNCIL CAN USE AS YOU WISH. YOU CAN

[01:05:03]

YOU CAN ACTUALLY SPEND DOLLARS ACROSS FUNDS JUST BECAUSE MONEY IN THE WATERFRONT OR SOLID WASTE FUND, CITY COUNCIL HAS THE AUTHORITY TO USE THOSE FUNDS ANYWHERE WITHIN THE CITY CHOOSES TO. SO YOU HAVE A TOTAL OF 65,000,793 TO DO, TO HAVE AS A RESERVE. NEXT SLIDE. THIS JUST GIVES SOME HISTORY THROUGH 2025 OF THE WATER UTILITIES FUND BALANCE. YOU KNOW, AS YOU SEE THROUGH 2020 IT WAS AROUND 11 MILLION. BUT WE'VE IN THIS ADMINISTRATION WE'VE PUT THINGS IN PLACE. ONE IS THROUGH WATER RATE INCREASES IS TO GROW THAT FUND BALANCE UP TO 18.2 MILLION.

AND THIS IS ACTUALLY A 2025 NUMBER. SO IT'S HIGHER THAN THAT NOW FOR 2026. WHAT WE'RE PROPOSING THAT PUTS THE CITY IN THE FIRST VERY STRONG POSITION WITH THIS BALANCE. NEXT SLIDE.

AND THIS KIND OF GIVES YOU A GRAPH SNAPSHOT IN 2021. THAT WATER UTILITIES FUND BALANCE WAS AROUND 15 MILLION. YOU SAW IT WENT DOWN TO 2023 TO ABOUT CLOSE TO 11. PLUS I CAME IN IN 2023. AND OUR GOAL WAS TO GROW THIS FUND. AND YOU CAN SEE HOW IT'S GROWN. MY FIRST BUDGET WAS 2023. SO IN 2023 WE PUT THINGS IN PLACE TO GROW THIS FUND. IT'S NOW WE'RE PROJECTED TO BE OVER $19 MILLION NEXT YEAR. NEXT SLIDE. SOLID WASTE FUND BALANCE. SAME THING. YOU CAN LOOK AT THE HISTORY SINCE 2020. IT WAS PRETTY FLAT. WE PUT SOME THINGS IN PLACE. WE DID SOME THINGS WITH RATES OUT AT THE LANDFILL. AND YOU CAN SEE NOW THAT WE'RE PROJECTING THAT NEXT YEAR FOR THAT TO BE 5 MILLION, WHICH IS OVER $3 MILLION, GROWTH IN THAT FUND JUST A YEAR.

WE HAVE SOME THINGS TO DO WITH SOLID WASTE, BUT THE STORY IS WE'RE GROWING THESE BALANCES AND IT'S NOT JUST YOUR FUND. YOU HAVE TO BE CONCERNED WITH IT. IT'S SOLID WASTE FUNDS AND WATER FUNDS, ETC. NEXT SLIDE. AND THIS GIVES YOU A LITTLE BIT OF HISTORICAL DATA ABOUT YOUR FUND BALANCES. THE CHART ON THE LEFT KIND OF GIVES YOU A TEN YEAR HISTORY, $32 MILLION IN 2015. AND THE FUND ON THE RIGHT. JUST SHOWING THE CORRELATION BETWEEN FUND BALANCES AND THE CITY RECEIVING DOLLARS FROM DISASTERS THAT INCREASE THESE FUND BALANCES. YOU CAN SEE AS IT STARTED TO GO UP IN IN 2018 AND 2017, YOU RECEIVED HURRICANE HARVEY DOLLARS, ABOUT $23 MILLION THAT WENT INTO YOUR INTO YOUR COFFERS THERE. YOU KNOW, IT HAPPENED IN 2017. BUT THOSE MONIES COME IN AND THE NEXT YEAR. SO IT PEAKED UP TO THAT $54 MILLION. AND THEN IN 2020 YOU HAD COVID AND THE CITY GOT A $41 MILLION IN INJECTION. YOU KNOW, SOMETIMES THERE'S FORTUNE AND MISFORTUNE, AND THAT'S THE CASE WITH DISASTERS. OFTENTIMES IT'S FORTUNE AND MISFORTUNE, AND YOU GET THOSE DOLLARS. AND THEN, AS YOU CAN SEE IN 2023 AND 21, YOU HAD A SMALL EVENT, THE WINTER STORM YOUR CITY WAS REIMBURSED $125,000. YOU CAN SEE WHAT THE WHAT'S STARTING TO HAPPEN IS THE CORRECTION WHERE THOSE BALANCES ARE COMING BACK DOWN MORE TO WHAT THEY NORMALLY ARE, ALTHOUGH THEY ARE HIGHER THAN BEFORE. 2015 2016. NEXT SLIDE.

AND AGAIN THIS THIS IS ANOTHER ONE THAT GIVES A PRETTY GOOD PICTURE. WITH THIS GRAPH OF YOUR FUND BALANCE. YOU CAN SEE IN 22,003 TO 2017, THE CITY ONLY HAD A 10% FUND BALANCE REQUIREMENT. SO YOU COULD SEE DOWN AT 10%. BUT, BUT THE AMOUNT WAS HIGHER. IT WAS UP AROUND 30%. AND YOU CAN SEE THE HISTORICAL DATA FOR THE CITY OF BEAUMONT. IS THAT 30% RANGE. IF YOU LOOK FROM 2007 TO 2017, IT'S IN THAT $30 MILLION RANGE. ALL OF THOSE TEN YEARS. NOW, WHAT HAPPENED FOR A DESPITE THAT'S WHEN YOU HAD THAT THOSE DISASTERS AND YOU GOT THOSE INFLUX OF CASH. YOU GOT INFLUX OF CASH FROM HARVEY, COVID AND ALL OF THAT. AND YOU CAN SEE WHERE THAT GRAPH PEAKS. IT GOES UP AND YOUR YOUR FUND BALANCES GO UP. BUT WHAT IT'S STARTING TO DO NOW IS GOING BACK TO THAT NATURAL CORRECTION, BACK INTO THAT 30, $40,000 RANGE WHERE

[01:10:01]

IT'S ALWAYS BEEN FOR EVER SINCE 2005, SIX TIME PERIOD. NEXT SLIDE. TRANSFERS OUT. LET'S TALK ABOUT TRANSFERS OUT TO WHAT THE CITIES ALWAYS HAVE HAD. TRANSFERS OUT. IF YOU LOOK AT 2010 TO 2025, TRANSFERS OUT OF INCREASED ABOUT 8,000,007. YOU KNOW THAT WAS A TIME NOT ONLY TRANSFER OUT YOU HAD WAS FOR TRANSIT, WHICH WAS 1,000,009 $1,900,000. BUT NOW YOU HAVE OTHER THINGS FOR TRANSFERS OUT. YOU HAVE TRANSIT, YOU HAVE CAPITAL ITEMS, YOU HAVE BENEFITS, LIABILITY INSURANCE, ETC. IT'S ALL COMING OUT OF THAT FUND. SO THAT NUMBER DOES GO UP AND IT DOES FLUCTUATE. NEXT SLIDE. AND SUSTAINABLE ECONOMIC GROWTH. YOU KNOW AND PEOPLE SAY HOW CAN WE MAINTAIN ESPECIALLY WHEN WE HAVE CONTRACTS WITH POLICE AND FIRE THAT STEADILY GO UP. AND SO WE'RE GOING TO TALK ABOUT HOW THE CITY WILL BE ABLE TO SUSTAIN WELL INTO THE FUTURE OR WHAT WE'RE DOING. ONE IS WE TALKED A LITTLE BIT. YOU HAVE AN INCREASES IN PROPERTY TAX VALUES. YOU KNOW, PROPERTY TAX VALUES. IT'S GONE UP $4 BILLION IN TEN YEARS IN THE CITY OF BEAUMONT. YOU KNOW. SO WHILE BEAUMONT HAS ITS CHALLENGES, DON'T ALWAYS LISTEN TO PEOPLE TELL YOU THE ECONOMY IS NOT DOING OKAY. IT'S GROWING. YOU KNOW, IT'S INCREASED BY 56.9% FROM 2016 TO 2025. YOUR PROPERTY TAX VALUES. NEXT SLIDE.

THEN SALES TAX. SALES TAX IS INCREASED HERE. YOU KNOW THIS IS AGAIN 2025. BUT YOU HAD A 15.3% INCREASE FROM 2018 TO 2025. AND SALES TAX PROPERTY TAX AND SALES TAXES ARE YOUR TWO LARGEST SOURCES OF REVENUES. AS A CITY. THEY'RE THEY'RE RUNNING NECK AND NECK. AND WHAT THAT IS. SO BOTH OF THOSE ARE INCREASING. BOTH OF THOSE ARE GOING STRONG. IT OFFERS A SUSTAINABILITY IN THE FUTURE TO BE ABLE TO FUND INCREASES, TO BE ABLE TO PAY FOR THINGS AND STILL MAINTAIN A HEALTHY RESERVE. NEXT SLIDE. AND THIS IS JUST A 2024 SALES TAX. I HAD A COMPLETE SLIDE OF SALES TAX IN THIS AREA. YOU LOOK AT ALL THE CITIES IN THIS AREA.

BEAUMONT'S JUST ABOUT OUTPERFORMED EVERYBODY ON SALES TAX AND WHAT IT DID. YOU KNOW BEAUMONT GOT 52.52 MILLION. BUT PERCENTAGE WISE IT WAS 3.5% INCREASE IN THE CITY WAS 7.33.

BUT WE'RE TALKING ABOUT ONLY $164,000 VERSUS $1.8 MILLION. SO THE ECONOMY HERE HAS PERFORMED AS WELL OR BETTER THAN OTHER CITIES IN THE REGION. AS YOU LOOK AT THIS DATA AND WHAT YOU'VE DONE WITH SALES TAX, WHICH IS, AGAIN, YOUR SECOND LARGEST SOURCE OF REVENUE VERSUS SECOND, NEXT SLIDE. AND THEN, YOU KNOW, BUT THEN DOING ALL THIS, YOU STILL HAVE TO REMAIN PRUDENT. WE HAVE TO REMAIN PRUDENT IN BUDGETING. WE HAVE TO MAKE SURE WE'RE WE'RE.

CONTROLLING, WE'RE CUTTING. WE'RE PUTTING THINGS IN PLACE. WE HAVE RECURRENT EXPENSES JUST BECAUSE OF THE EXPENSE INCURRED THIS YEAR, BECAUSE WE HAVE A PARKS PLAN THIS YEAR THAT DOESN'T COME BACK NEXT YEAR. SO THOSE DOLLARS ARE RECURRING NON-RECURRING. SO THEY COME BACK TO BE USED WITHIN THE BUDGET FOR THAT NEXT YEAR FOR YEARS IN THE FUTURE. SO WE LOOK AT THOSE THINGS. WE HAVE PROGRAMS THAT YOU WON'T HAVE IN THE FUTURE. THOSE PROGRAMS GO AWAY. WE HAVE WE HAVE OUR DEPARTMENT HEADS EVERY YEAR PROVE UP THEIR PROGRAMS TO SEE IF THERE'S SOMETHING THAT'S STILL NEEDED FOR THE CITY AND IF IT'S NOT NEEDED, THOSE MONEY GOES BACK INTO THE POT TO USE FOR SOMETHING ELSE. SO WE CONTINUE TO DO THAT. AND THEN TWO, YOU HAVE CAPACITY FOR SALES. I MEAN, PROPERTY TAX INCREASES AS THIS YEAR YOU COULD HAVE RAISED PROPERTY TAX 33.03 1% IF YOU CHOSE TO. WHAT YOU WOULD WHAT GENERATED OVER $3 MILLION FOR YOU. SO THERE ARE PLENTY OF SOURCES TO TO FOR SUSTAINABILITY, FOR BEAUMONT TO REMAIN STRONG AND PRUDENT WITH BUDGETING WELL INTO THE FUTURE. WHEN PEOPLE SAY, WELL, WHAT ARE WE GOING TO DO THEN? YOU YOU'RE IN GOOD SHAPE WITH THAT NEXT SLIDE. AND ANOTHER THING, WHAT WE'VE DONE SINCE I'VE BEEN HERE, SOME PEOPLE WERE, BUT BEAUMONT USED TO BE FULLY SELF-INSURED.

THAT'S NO LONGER THE CASE. IN 2324 WE GOT HERE. WE GOT INSURED WITH THE TEXAS MUNICIPAL LEAGUE AND INTERGOVERNMENTAL RISK POOL, WHICH INSURES THE VAST MAJORITY OF OUR RESOURCES. AND WHEN SOMETHING HAPPENS, ALL WE HAVE TO DO IS PAY A DEDUCTIBLE, LIKE

[01:15:05]

THE BUILDING WE JUST LOST IN A FIRE. EITHER WE CAN REPLACE IT OURSELVES OR JUST PAY A DEDUCTIBLE AND HAVE IT REPLACED. SO BEAUMONT IS NOT A EXPOSED LIKE IT WAS IN THE PAST WHEN YOU WERE FULLY SELF-INSURED AND YOU ALL, EVERYTHING YOU REPLACE HAD TO COME OUT OF YOUR POCKET.

WE SUBMIT A CLAIM TO HTML. THEY ACCEPT THAT CLAIM AND WE GET PAID BACK FOR THE MANY OF THOSE RESOURCES NOW. SO WE'RE THAT EXPOSURE IS JUST NOT THERE AS MUCH AS IT WAS BACK THEN. SO IT'S YOU HAVE THE MAJOR PROTECTION FOR MAJOR LOSSES, MAJOR PROTECTIONS FROM MAJOR STORMS, DISASTERS, ETC. THAT IF YOU KNOW, IF INSURANCE DOESN'T PAY, FEMA DOESN'T PAY, OUR INSURANCE COMPANY PAYS. BEFORE WE EVEN HAVE TO THINK ABOUT PAYING FOR SOMETHING OUT OF OUR POCKET NOW. AND THERE MIGHT BE ONE MORE SLIDE THERE, ANOTHER SLIDE, A COUPLE OF, OH, I WANT TO TALK ABOUT THIS. AND THEN JUST FOR CONFIDENCE SAKE, AND WHAT WE DO AS FAR AS ACCOUNTING AND PRINCIPLES, WE FOLLOW THE GENERAL ACCEPTED ACCOUNTING PRINCIPLES. GAAP PRINCIPLES FOLLOW WITHOUT ACCOUNTING, WITHOUT PROCESSES, RECOMMENDATIONS, CHECKS AND BALANCES TO MAKE SURE THAT WHAT WE DO IS ALL ABOVE BOARD. AND ACCORDING TO THE GENERAL ACCEPTED ACCOUNTING PRACTICES. NEXT SLIDE. CITY BOND RATING. YOU HAVE A VERY GOOD BOND RATING. THIS CAME FROM MOODY'S NOT LONG AGO. SO AGAIN CONFIDENCE IN WHAT WE DO. IT'S AT THE CITY'S MOST RECENT RATING REPORT FROM MOODY'S FOR UTILITY THAT THEY HIGHLIGHTED THE CITY SIZABLE SERVICE AREA AND INSTITUTIONAL CUSTOMERS AND RECENT ACTIONS TO IMPROVE REVENUES, INCLUDING RATE STUDIES AND REVENUE RECOVERY EFFORTS. AND ONE FACTOR LISTED THEY THEY THAT THEY SAID THAT COULD LEAD TO A RATE DOWNGRADE IS FAILURE TO IMPLEMENT RATE INCREASES AS ANTICIPATED. AND BECAUSE OF THAT, BECAUSE THAT WAS PUT INTO OUR AUDIT. THAT IS ONE REASON WE STARTED IMPLEMENTING RATING CONTINUED RATE INCREASES, BECAUSE WE COULD THE CITY COULD BE DOWNGRADED IF WE DID NOT DO THAT. NEXT SLIDE. AGAIN A1 RATING, HIGHER CREDIT RATING. OUR FINANCE CITY FINANCIAL, RBC CAPITAL MARKET RECORDING.

EXCUSE ME GEO DID. SEE THIS RATE IS IN THAT DOUBLE A CATEGORY WHICH SIGNIFIES A VERY HIGH QUALITY DEBT INSTRUMENT. VERY LOW CREDIT RISK RATINGS IN THIS CATEGORY INDICATE ISSUES WITH THE VERY STRONG CAPACITY TO MEET THEIR FINANCIAL OBLIGATIONS. NEXT SLIDE. AND THIS IS THE RATING WE GOT IN OUR LAST AUDIT. WE GOT AN UNMODIFIED AUDIT OPINION WHICH IS THE HIGHEST RATING A CITY CAN GET IN AN AUDIT. AN UNMODIFIED AUDIT OPINION. IT'S THE BEST THE CITY CAN ACHIEVE. AND WE'VE GOTTEN THAT EVERY YEAR. EVERY YEAR WE'VE BEEN HERE. SO OUR AUDITORS SAID THAT OUR OUR RATING AGENCIES GIVE US A GRADE. THE CITY'S IN A GOOD STATE FINANCIALLY. NEXT SLIDE. AND IN CLOSING, JUST YOU KNOW, WE'VE GONE THROUGH THIS PROCESS.

WE'VE HAD A LOT OF DISCUSSION. THIS IS BASICALLY THE SUMMIT PRESENTED THE ENTIRE FINANCIAL PLAN TO YOU. I WON'T GET INTO THAT TODAY, BUT IT'S BEEN SUBMITTED TO YOU. YOU KNOW, WE'VE AMENDED AND ADJUSTED BASED UPON YOUR FEEDBACK. AND FROM THE LAST MEETING, WHICH WHAT YOU GAVE A BUDGET IS YOUR BEST ESTIMATE OF WHAT'S GOING TO HAPPEN DURING THE YEAR.

THERE'S NOTHING IN CONCRETE THAT HAS HAPPENED, BUT IT PROVIDES A GUIDELINE FOR US TO FOLLOW AS WE GO THROUGH THROUGH THE YEAR AND A BUDGET PROCESS. AND THIS IS OUR BEST ESTIMATE OF WHAT WE CAN DO AS A CITY. WILL THEY BE PERFECT? NO. YOU WILL MAKE AMENDMENTS, YOU CAN MAKE ADJUSTMENTS AND YOU HAVE THE ABILITY TO DO THAT EVERY MEETING YOU CHOOSE TO TO DO SO.

BUT WE DO SUBMIT THIS BUDGET AND WE'RE ASKING FOR CONSIDERATION OF ADOPTION OF THIS BUDGET AND TAX RATE. THANK YOU. THANK YOU, MR. CITY MANAGER. THANK YOU. I'LL PAY YOU LATER. WE HAVE ANYBODY SIGNED UP TO TALK DURING THE PUBLIC HEARING? NO, SIR. I DO NOT. ALL RIGHT WITH THAT. THE PUBLIC HEARING IS NOW CLOSED. MR. CITY MANAGER, WOULD YOU

[4. Council to consider an Ordinance adopting a budget for operating the municipal government of the City of Beaumont for the Fiscal Year beginning October 1, 2025 and ending September 30, 2026; adopting a Master Fee Schedule; appropriating money for the various funds and purposes of such budget including appropriations of money to pay interest and principal sinking fund requirement on all indebtedness; repealing all ordinances and appropriations in conflict with the provisions of the ordinance; and establishing an effective date.]

TAKE US INTO ITEM NUMBER FOUR, PLEASE? YES, MAYOR. COUNCIL, TO CONSIDER AN ORDINANCE ADOPTING A BUDGET FOR OPERATING THE MUNICIPAL GOVERNMENT OF THE CITY OF BEAUMONT FOR THE FISCAL YEAR BEGINNING OCTOBER 1ST, 2025 AND ENDING SEPTEMBER 30TH, 2026. ADOPTING A MASTER FEE SCHEDULE, APPROPRIATING MONEY FOR THE VARIOUS FUNDS AND PURPOSES OF SUCH BUDGET,

[01:20:04]

INCLUDING APPROPRIATIONS OF MONEY TO PAY INTEREST AND PRINCIPAL SINKING FUND REQUIREMENT ON ALL INDEBTEDNESS, REPEALING ALL ORDINANCES AND APPROPRIATIONS IN CONFLICT WITH THE PROVISIONS OF THE ORDINANCE, AND ESTABLISHING AN EFFECTIVE DATE. AND IT COMES WITH THE RECOMMENDATION. APPROVAL OF THE ORDINANCE. IS THERE A MOTION FOR ITEM NUMBER FOUR? MOVE TO APPROVE. SECOND, THERE IS A MOTION AND A SECOND FOR APPROVAL OF ITEM NUMBER FOUR.

IS THERE ANY DISCUSSION, COUNCILMAN TURNER? YES, I HAVE A FEW KIND OF POINTED QUESTIONS TO GET CLARITY. SO WE ALWAYS HAVE A PROPOSED WHAT THEY WHAT THEY CALL DEFICIT. AND MOST TIMES YOU HAVE A PROPOSED DEFICIT. NORMALLY AT THE END OF THE YEAR IT IT OUTPERFORMS WHAT IS THE PROPOSED DEFICIT. AM I CORRECT WITH THAT. YEAH. WELL WHAT YOU'RE SPEAKING TO IS WHEN REVENUES EXPENDITURES EXCEED REVENUES BASICALLY. SO IN THIS BUDGET IT'S APPROXIMATELY $4.5 MILLION. AND EVERY YEAR, EVEN BEFORE I GOT HERE, IT'S BEEN THAT WAY. BUT BY THE END OF THE YEAR, IT'S ALWAYS BEEN A POSITIVE NUMBER. YOU KNOW, WHETHER IT'S 2 MILLION IN ADDITION OR 4 MILLION IN ADDITION, BECAUSE OF THE WAY WE'RE OPERATING, THE WAY THE CITY SETS UP, WE FULLY FUND ALL OF OUR POSITIONS, JOBS AND POSITIONS. AND THEY DON'T THEY'RE NOT ALWAYS FILLED, FOR SURE. AND I HATE TO SINGLE THEM OUT. LIKE FOR OUR DEPARTMENT, WE HAVE APPROXIMATELY 26, 28 VACANT POSITIONS, BUT WE HAVE TO FULLY FUND THEM. AND THERE ARE TREMENDOUS SAVINGS AS WE GO THROUGH THE YEAR. SO THIS QUESTION MAY NOT BE ONE YOU CAN ANSWER. MR. WILLIAMS, MAYBE FINANCE OR WHO MAY WHO MUST BE OVER THE FINANCE DEPARTMENT.

WHEN I SOMEWHAT FIRST GOT ON COUNCIL, THE PROPOSED DEFICIT WAS PRETTY HIGH. IT WAS AROUND 8 MILLION PLUS. AND LAST YEAR IT CAME IN PROJECTED AROUND 3.5 MILLION. AND THIS YEAR, YOU KNOW, IT'S A PROJECTION THAT WAS NORTH OF I THINK IT WAS 7,000,006 7.6. SO WHAT I WANT CLARITY ON IS IF AS A COUNCIL, THE ENTIRE BODY HAS BEEN PUSHING TO HAVE A HEALTHY FUND BALANCE, WHY WOULD WE COME IN WITH A PROJECTION HIGHER THAN IT WAS THE PREVIOUS YEAR? LIKE, I JUST WANT TO CLARITY ON HOW DID WE GET TO THAT AND WHY. I'LL SPEAK TO IT FIRST. AND STAFF, FEEL FREE TO SPEAK. I THINK THE MAIN THING, THE 4.5 MILLION, IF YOU LOOK, IS IT'S ALMOST THE EXACT NUMBER. WHAT WE DID IN SOME PAY INCREASES WITH POLICE AND FIRE WAS ALMOST 4.5. YOU KNOW, WE WE CAME IN AND DID THE SEVEN AND FOUR. WE WERE CLOSE TOGETHER AT THE FIRE DEPARTMENT. AND THEN WE HAVE FOUR IN THE CONTRACT WITH THE POLICE DEPARTMENT. AND THEN THERE WERE OTHER CIVILIAN INCREASES TO WHICH THEY SORELY NEED THAT. SO THAT THAT KIND OF ACCOUNTS FOR THAT DIFFERENCE RIGHT THERE IN ITSELF. AND I UNDERSTAND THAT WITH THE RANGERS, BECAUSE EVERY RAISE COUNCIL, WE APPROVED IT AS A WHOLE. BUT ON THE FLIP SIDE, IT STILL WAS SLIGHTLY ABOVE THAT 4.5. IT WAS 7.6. SO MY CONCERN IS IF WE KIND OF HAVE BEEN CONSISTENT AS A COUNCIL AND KIND OF SAYING, AND I UNDERSTAND YOU MIGHT HAVE 2 OR 3 COUNCIL MEMBERS THAT MIGHT DIFFER, BUT IF FOUR OR MORE KIND OF SAYING WE WANT A HEALTHIER FUND BALANCE, YOU KNOW, WHY WOULD THE PROJECTION BE HIGHER THE FOLLOWING YEAR THAN WHAT IT WAS THE YEAR PRIOR TO? WELL, IN EACH BUDGET YEAR STANDS ON ITSELF. YOU KNOW, YOUR REVENUES AND EXPENDITURES STAND ON ITSELF AND YOUR PROGRAMS AND EXPENDITURES. AND THIS YEAR, WE HAD A LARGE INVESTMENT IN CAPITAL ITEMS. YOU KNOW, LAST YEAR WE ONLY SPENT $435,000 ON CAPITAL ITEMS. THIS YEAR, WE'RE PROPOSING TO SPEND IT FOR ALMOST 4 MILLION, APPROXIMATELY $4 MILLION ON CAPITAL ITEMS. BECAUSE WE IT'S TIME THAT WE BUY THIS, THESE THINGS THAT POLICE AND FIRE AND PUBLIC WORKS AND THEY ALL NEED TO DO THEIR JOBS. SO WE NEED TO DO THAT THOUGH I UNDERSTAND THAT MY MY PUSHBACK STILL IS, THOUGH. WE LOOK TO PURCHASE, MAKE SOME OF THOSE ONE TIME PURCHASES. YOU'RE ALSO LOOKING TO DO A BOND ELECTION THAT'S NEVER BEEN DONE IN OVER 43 YEARS IN BEAUMONT. AND I. MY REQUEST WAS FOR STAFF TO BE SENSIBLE AND AND UNDERSTAND THE COMMUNITY THAT WE'RE DEALING WITH. YOU KNOW, WE'RE RAISING EXPENDITURES, DOING THESE ONE TIME EXPENSES, AND WE'RE DOING SOMETHING TO THIS MAGNITUDE. SO FOR ME, YES, I DID PUSH BACK TO SEE SOME CUTS MADE. AND MR. WILLIAMS, YOU GUYS DID A GREAT