Audit and Finance Committee (AFC) Meeting Transcript – 3/4/2026 Title: ATXN-1 (24hr) Channel: 1 - ATXN-1 Recorded On: 3/4/2026 6:00:00AM Original Air Date: 3/4/2026 Transcript Generated by SnapStream ================================== Please note that the following transcript is for reference purposes and does not constitute the official record of actions taken during the meeting. For the official record of actions of the meeting, please refer to the Approved Minutes. [9:29:29 AM] I will call to order the audit and finance committee of the Austin city council. We are meeting in the council chambers, which are located at city hall at 301 west second street in Austin, Texas. And we have all of the members of the committee present. Members, we're just going to go through [9:30:29 AM] the order as it's laid out in the agenda. And I will first turn and ask if we I know we have public comment and ask you to please call the names of the people that have signed up to speak. When she calls your names, by the way, please come forward and go ahead and take a chair so that a we know you're here and B you'll be ready to provide your public comment. Miss love. >> Yes. If we can have holly read, who's going to speak virtually and right behind her, we will have Chris flores, Michael Nahas, Jeffrey Bowen and Jose Garza. >> Perfect. Thank you. >> Go ahead. Holly. >> Miss Reid, please go ahead. Please begin. >> Committee. Good morning. [9:31:30 AM] Audit and finance committee. My name is holly Reid. I live in district ten, and I served as a member of the Austin parks and recreation board from 2023 to 2025. On February 25th, the city of Austin auditors and city manager received an audit request to review evidence that former parks director Kimberly Mcneely made an unauthorized decision to divert $25 million of parkland mitigation funds from the parks department to her future employer, the trail conservancy. Her decision concerning the use of this massive amount of public funds was made without consulting parks department staff or her supervisor, assistant city manager haydn Howard. For two years, Mcneely and former trail conservancy CEO Heidi Anderson created a scheme to funnel $25 [9:32:30 AM] million of Texas department of transportation for mitigation funds directly to the trail conservancy, for the trail conservancy to solely construct a boardwalk for the Hyatt hud developer attempting to bypass the city's parks department review and the city's competitive bidding process. Mcneely then applied for the job of trail conservancy CEO. Her actions have violated at least three sections of municipal code, including standards of conduct, disclosure of conflict of interest, and restrictions on providing representation of others, a disclosure requirement that is in effect for 24 months after a former city official or city employee leaves city service or employment. I ask that you please support this audit request and review the role of former parks director Mcneely and the Texas department of [9:33:32 AM] transportation to trail conservancy funding scheme, intended to divert $25 million in public funding from the city of Austin parks department to the trail conservancy. Mcneely's future employer. This audit request has also been sent to you, and I ask for the sake of public trust that you demand greater financial transparency and ethical accountability in relationships between the parks department and any nonprofit partners. Thank you. >> If we can have Chris flores next, followed by Michael Nahas, Jeffrey Bowen and Jose Garza. >> Good morning. Elected people. My name is Chris flores. I'm a resident of district ten. I'm speaking today on a citizen requested city audit by miss Diana proctor about a $25 [9:34:34 AM] million highway mitigation payment, which appears currently to be pointing to a private entity. And your review and approval. My first ask of you today is to please postpone indefinitely your vote on a boardwalk contract until a full audit is done. Typically, these mitigation payments are not newsworthy. They're made from government to government. The government to private is highly unusual. I think government agents involved at txdot and the city have violated their fiduciary relationship with the public in making this deal happen, and an audit will show this fiduciary. Just for the record, according to the dictionary, is a person to whom property or power is entrusted for the benefit of another. There are four factors that define a fiduciary relationship between government and public, and they are one. The public has delegated authority to government agents over public assets to act on our behalf. [9:35:35 AM] Two government agents have discretionary powers over the public assets and interests. Three government agents are in a position superior to that of the public due to their specialized access, knowledge and ability for the public trusts that government agents will act in their best interest. Routing 25 million from txdot to a private entity for the primary benefit of a boardwalk to front one. Lady bird lake, a condo building, and away from the parks department's land purchase team, is not in the public's interest. The stated purpose resolving an eight foot pinch point is bogus. The lake trail has many such eight foot, eight foot pinch points. My second ask today is that you initiate a study and recommendation that all city staff have their fiduciary responsibilities to the public, defined in their job descriptions, to prevent future conflicts of interests. I researched the parks department [9:36:35 AM] director's job description and found no mention at all of fiduciary responsibility. Thank you. >> Up next, we'll have Michael Nahas. >> Good morning. My name is Michael Nahas. I'm on the economic prosperity commission, but I'm speaking on my own behalf. I spent the last year looking into the pensions, and I'm here to relay my news. And I wore a black tie because the news is not good. I'm an expert in investing. I traded on the New York stock exchange for the options market maker walleye trading. Who owns who controls 9% of that market. I also have a masters of economics from UT. My thesis was in international bonds and currency futures. I'm an expert. The pensions are not [9:37:36 AM] in good shape. I hope you're all familiar. This is slide three. We've been underfunding the pension since about 2000. The amounts been growing about $100 million per year. And we've done that for 24 years. We currently owe the pensions about $3.5 billion. One point I would like to communicate to you today is underfunding grows exponentially. The the target amount for pension depends on future investments from that pension. If we have it underfunded, we don't get the returns from those investment and the amount grows. If you look on slide five, you'll see that the amount it is growing by is labeled interest in each of the pension reports. That is current in 2024. The amount it is growing by is $308 million in one year. Because it grows exponentially, it is viewed as [9:38:37 AM] debt, and we are borrowing from the pension funds at a 6.9% variable interest rate, as opposed to a general obligation debt of 4.3% at a fixed rate. The other point I would like to communicate to you is that Austin does not have a realistic plan. The the next slide shows the current plan. We're at about $3.5 billion. This is just cause one pension, but we're at $3.5 billion. We plan on increasing the underfunding for the next five years will be in the exact same position. Ten years from now, we'll have paid 6.9% interest for ten years and be in the exact same position. That will waste $2.4 billion for austinites, or $2,400 for every person in Austin. Not every worker, not every taxpayer, every person. My ask to you today is to put an item on your [9:39:39 AM] agenda for a month from now to allow me to present my results in full. Thank you. >> Thank you, Mr. Bowen. >> Good morning everybody. Good morning mayor, committee members, I'm here this morning because I, I was reading the consultant contract management audit report. And actually the young lady that spoke before me actually helped a whole lot because I was going to start off with the definition of fiduciaries. And I really appreciate that, because when I started reading this, the first thing that jumped out at me was said, the city may not be able, may not be able to demonstrate consultant services or justified, or they efficiently help city objectives and the needs of residents and do not consistently evaluate performance. So on and so forth. So, so over two years, we're looking at $279 million. Now, I really appreciate the report, [9:40:40 AM] but it leaves a lot of questions for me, such as who approves all of these different contracts? Was anybody asking the questions? Is this a want or is this a need? And if it's a need, then where's the rest of the evaluations that says, well, is this because of training? Now I realize that there's some of these departments are highly technical and they need some different consulting. So didn't we recently have an issue to where we wanted to get rid of positions that we haven't been able to fill, but we're so we got rid of those positions. But were those positions needed to maybe fill some of this void? So the report in itself, I find it to be very interesting, but also very disturbing in the fact that we only looked at a certain percentage of organizations within this organization, yet they're not we're not notified as to what these which one of these departments, they were so out [9:41:41 AM] of the giant list of departments, what was that 8% that was missing this or the 9% that needed the documentation? So on and so forth. So is there an issue with not being able to train our personnel that are monitoring these projects or monitoring these consulting projects, or are they just not doing it? Because I did notice this in several of these places that the personnel left that was managing these for the different departments. Why did that person leave? Was this was there no transition from from one person to another to keep the management of this consulting job going on? So I find a lot of questions, and I'm hoping that the audit commission here, the audit committee here, will ask a lot of hard questions as to what's going on, who's responsible, and also does it, who falls, who pays for or who approves [9:42:43 AM] the payment of this? Is it done strictly on consent, or is it out of the commission, out of the different departments itself? Thank you. >> Thank you, Mr. Bronin. >> Up next, we'll have Jose Garza. >> Mr. Garza. I don't see Mr. Garza. Okay. Thank you very much. Members that will take us to item number one on the agenda, which is the approval of the minutes. These are you have two sets of minutes. You'll recall that I asked that we pull the minutes from a previous meeting and they've been redone. And that's what we have here today. It would be to approve the minutes of the audit and finance committee meeting of January 14th, 2026 and the February 3rd, 2026 meeting is I'll it's moved by council member duchen, second by council member Fuentes that we approve those minutes. Any discussion without objection. Item number one is adopted. Now we'll go to a discussion and [9:43:44 AM] possible action on a couple of items. And the first one is item number two. With regard to the potential discontinuation or dissolution of the south central waterfront advisory board. Yes, ma'am. >> Good morning, Stephanie hall, deputy city clerk. And I'm here to present the discussion on the south central waterfront. City code does require that if a board or commission fails to convene for a continuance of six months, that we are to report them to the audit and finance committee. That sounds bad. Report to send a notice to the audit and finance committee. >> To let us know. >> Yes. To inform you that they have failed to meet. And then there is a 60 day period in which the audit and finance committee needs to make a recommendation on the dissolution or continuance of the the advisory board. In this particular instance, the south central advisory board has failed to meet. They've struggled to make quorum for about a year. The last time they met was in March of 2025. And then they did. They were able to make quorum just this past February. This board is a little bit unique. They have nine seats, and five members are required to be present in [9:44:45 AM] order to convene a meeting. There were several factors that we noticed that were contributing to the vacancy, but the largest part was that most of the terms expired at the end of February last year, and those seats were a bit difficult to fill, and that's primarily due to several of the seats being needed to fill by neighborhood associations. I think just proposes some specific, specific challenges. That's kind of the general overview. I believe that the staffing department has some recommendations as well. So I'll go ahead and turn it over to them. >> Great. Thank you. >> Good morning. Mayor. Council members Kim Olivares, director of financial services, thank you for providing the background information on the south central waterfront advisory board. I wanted to provide just additional detail. Like we noted, there's the nine voting members. There are. In addition to those nine, there's five non-voting ex officio members appointed by the downtown Austin alliance and various city departments. As you can see here, there are the the five or the six members that have been appointed and [9:45:46 AM] were were relatively active. But then there were three vacancies going back to June of 2024. However, that June 2024 vacancy was actually just filled by council or approved by council this past week. That being said, there are a number of challenges presented for this advisory board. First and foremost, the south central waterfront was going to be supported by a tax increment reinvestment zone that tirz was struck down by Travis county district court in April 2024. In addition, in September of 24, the deliberation on the regulatory framework for implementing the south central waterfront vision plan was indefinitely postponed, and as was noted previously, 2025, there was just a single meeting. So in January, the city clerk sent that notice. And in March, we are here to speak to you about it and more. Our recommendation is actually to just go ahead and dissolve the board for multiple reasons. For example, there are few implementation tools that are actually meaningful [9:46:47 AM] specifically to this advisory board because the regulatory framework has been postponed and the tirz was struck down. Also, planning commission oversees pud review for projects that are continuing to move through the process for this this area of town, there was there was a framework plan and then the unadopted draft of a combining district and density bonus program to serve as the foundation for work within the overall central city district and then also staff community members have been revisiting recommendations from the planning process to ensure that they are fully aligned with current efforts for the central city district's vision and goals process. Finally, the downtown commission approved a recommendation to expand their geographic purview to align with the central city district plan. So there is another option for this to be incorporated into an existing board or an existing commission, and also aligned with the overall efforts of our our [9:47:48 AM] folks in the planning department. >> And if the council wants to give specific direction, it could utilize a mechanism like that and could can give specific direction and thought to how that might go forward. There is an avenue to to move forward. Is what you're saying correct? >> Correct. Yes. So so we're really at a point where we greatly appreciate the service of all the the members of the advisory board in, in these previous years, but just because of various circumstances beyond their control, it really we're at a point where the board can be rolled into another commission and still the purpose be be upheld. >> Brigade members, do you have questions? All right. In that case, I would entertain a motion with regard to item number two. Council member alter moves. The dissolution of the south central waterfront advisory board. It is seconded [9:48:48 AM] by council member Fuentes. And again, I want to reiterate on behalf of the committee that's making this recommendation and what was just said, which is certain things have happened over the past couple of years that made this board. It created a real difficulty in what was intended when this board was created. So this is not a reflection on the board. It's the or any of the people that have served on the board. It is just the circumstances. And certainly we all understand a why people may not be going to the meetings, B why people may not have neighborhood groups and others may not have been making recommendations under the set of circumstances it is under. I guess it's code that says it will come to us as the audit and finance committee, to then make a recommendation by a certain point in time. There are also time deadlines that are built into that. And and we're also trying to make sure that we comply with those. So the motion has been made and seconded. Is there any [9:49:49 AM] discussion? Without objection, the motion is adopted and we have two other. We have the the alternate to our committee that's also here. And we're also joined by councilmember Siegel. And I'll just ask do you have any you all want to say anything about that? Good. >> I also support the dissolution. >> Thank you. All right. With that we have completed item number two. Thank you very much. Members that will take us to item number three, which is related to proposed changes to general obligation debt, financial policies. Of course the members are aware, but I'll call attention for the public's purposes. We the council has taken a pretty disciplined process of looking at how we go about making decisions related to general obligation debt and in fact, the council, at the last council meeting, adopted a framework for making those decisions that we've been referring to generally as a [9:50:50 AM] decision TRE. As part of that discussion, it naturally, I think, caused people to ask questions and think about the policies because the decision TRE specifically focuses on financial policies and practices of the city as part of how you go about making decisions, which is part of the discipline that the council has utilized and intends to utilize as we go forward during this year. In doing that, it's it's caused us to think through or think about at least those financial policies and financial practices. So what we've done is in consultation with our professional staff, including Mr. Benigno, we've looked at some of those. We've actually tailored the decision TRE so that it doesn't make reference in it doesn't make [9:51:51 AM] specific reference to what a financial policy actually says or said. It just refers to the financial policy that is in effect, which allows for the council to have consideration of the financial policies. Mr. Benigno is here today to make report and perhaps recommendations with regard to how we might go forward on financial policies. He has asked, and we've put in front of you a version of the decision TRE. This is what we ended up with. But the reason we've put this one, we put a clean one out there, if you'll remember, at the council meeting. So the public would have a clean framework or decision TRE. But the ones that you have in front of you is the one that had. Color coding so that you could see existing policies, existing staff procedures and things that were new so that it would be easier to make reference. When Mr. Benigno talks about the policies. And with that extraordinarily lengthy lead in, [9:52:51 AM] and I apologize for that. Mr. Van Nino. >> Thank you, mayor and committee members. Ed Benigno, chief financial officer for the city. As the mayor said, the city council has adopted a bond decision TRE. And in that decision TRE, it makes references to the city's existing policies as the as this committee and as the city council was having discussions and deliberations about that decision TRE. Some of the things that we heard the most was about those existing city policies. And so what we've attempted to do here in these recommended changes is to capture what we heard from council as those deliberations were occurring, and to present them to this committee for your consideration. If the committee were to accept these changes, we would then incorporate them into our financial policies. That will be part of the fiscal year 27 budget. And then ultimately, when the council approves the budget, these policies would be formally enacted through that mechanism. And I should say that every year the audit finance [9:53:52 AM] committee considers policy changes. Budget director Lang will be bringing likely will be bringing. We're still in the process of reviewing policies for other recommendations changes, but typically would be bringing recommended changes to our other policies as part of the budget cycle. But given all the discussion about a bond decision TRE, we wanted to get these in front of you sooner than later. There we go. So the first category of of and I should say too, in the backup, we have 12 existing financial policies. In the backup you'll see all 12 policies and a strikeout underlying version of what we're recommending. We're not recommending changes to most of them, but there are some that we would recommend. Changes to the first category being two policies related to our financial metrics. One speaks to a debt to av ratio [9:54:52 AM] and that our. Debt service be less than 2% of our total debt to assessed valuation be less than 2%. The second one that pertains to financial metrics is that our debt service to expenditures shall not exceed approximately awarded 20%. There's nothing wrong with either these metrics, other than they're focused on the criteria that the financial credit rating agencies use to evaluate the city's credit. And they're old criteria. They haven't used these for a number of years. Currently, the agencies look more so at total liabilities to total revenue, debt per capita. They also look at pension liabilities as part of evaluating the overall city's credit. The key point being that they change over time can almost assure you that in the future, they will continue to evaluate and make changes to their rating criteria. The other thing is, is that the circumstances [9:55:53 AM] change. So if we were to change these policies to match what the rating agencies currently use, for example, if we were to say we want to use liabilities, total liabilities to total revenues and having a metric associated with that, well, the level of total liabilities to total revenues that the city can sustain depends upon a whole bunch of other factors that the rating agencies look at. So they'll look at the strength and experience of the city's management team. They'll look at the strengths of the city's financial policies, council's willingness to adhere to the financial policies that they establish. They look at the budget flexibility that's afforded to us under state statute and a number of other factors. So changes in these factors would influence what we can do in regards to our financial metrics. I believe the intent behind all these policies is that we want to maintain a strong credit rating. And so what we're proposing to change it to is simply that the city shall structure its bond issuances and manage its long term bond sales schedule in a [9:56:54 AM] manner consistent with the city council's goal of maintaining a triple-a credit rating. And that way is a criteria change. And as circumstances change, staff, professional staff and our financial advisors can come to council with, here's how we achieve that goal. These are the metrics we need to stay within, and this is how we should be sizing and pacing our bond sales. So that's recommendation number one. >> If you don't mind, take two. >> Policies and reduce it to one. >> If you don't mind. What I would suggest is just so that if anybody has any questions on on as we go through these changes, I'm going to interrupt you, if you don't mind, and ask if anybody has questions with regard to this proposed change. We'll come back to it. But but if you're thinking about something right now, I want to make sure you have the opportunity to ask a question. Yes, mayor pro tem. >> And again, I know we're moving away from these, the current language and the current ratios. But what are those current ratios for the 2% debt to assessed value at 2%. And the debt service, the total expenditures at not exceed. >> I don't have the exact figures, but we're well below both of those. Okay. [9:57:56 AM] >> Councilmember alter. >> And just picking up on that, I think it's we are very well below those. And the 2% number that you referenced that is well below the state cap of 10%, right? So we've taken a state cap, been much more conservative, and are even exceeding that much more conservative metric. So I, I don't have a huge issue with getting rid of it. I think it makes the the case you make makes sense. I do want us to keep telling the story though, that we are being very prudent with our bond dollars, our bond issuances. And, you know, people always, whether they compare our budget or our debt to other cities, we have a tax base very different than San Antonio, very different than Dallas. And so it's it's never an apples to apples comparison. This gets you a little more [9:58:57 AM] apples to apples, right. To help you understand what type of assets or what type of value you have to support that debt. So the other thing that I do want to really hone in on, though, is kind of discrepancy between this language and what we put in the decision TRE. And that is I think we all have a goal to be aa. We would love to be aa, but we haven't always been. And I imagine one day, hopefully not anytime soon, but we will not be aa forever, right? It goes up and down of over time. And as we're thinking about our. Bonds and how it relates to our credit score, it seems to me that the policy should be more around our debt issuances not harming our credit rating, which is what is in the language in the decision TRE. Right? Because you go through these, the [9:59:57 AM] various ratings. And one of the things that really jumps out that you presented here, the opeb question, right. This is a big concern of our rating agencies, and we could be downgraded on that. And nothing we do in the bond arena is going to maintain a triple-a rating. Right. So I just think that that subtlety is something I would like to explore a little more. We don't want our bond issuances to harm us, but they may not be really what is driving our credit rating to begin with. >> And by having the more having this language as opposed to the other language is partly what you're suggesting is you it allows for us to talk about the various things that can make a difference, and also highlight how we approach that. So thank you for that. Councilmember. Councilmember duchen. >> Thank you, mayor. Thank you, Mr. Benigno, for this. Your logic here makes sense to me. I just have a request, which is if there's a way or mechanism [10:00:59 AM] that you can think about to keep us updated about what the current criteria are, as well as per council member or mayor pro tem question, keep us informed of what the what the actual values of those criteria are on a periodic or ongoing basis. That would be helpful for us. >> Yeah, we can do that. And I actually think it was in a recent briefing, it was, you know, one slide amongst 40 slides, but those criteria were actually in a an earlier briefing on our current position. But we can certainly send that back to the committee and make sure that we do it on a regular basis. >> Thank you. Great. Thank you. All right. Mr. Benigno, I interrupt you if you'll go to the next slide. >> Okay. The next category. And I would ask. >> If I could. I think we've jumped. I think you've gone two slides. There you go. >> The financial metrics and there you go. That's it. And I [10:02:00 AM] do think these next two to me they really relate. So I kind of like to lay out the next two and then try to explain them. And then we can maybe pause there. Okay. So the next two have to do with the timing of bond elections and the sizing of the elections. And in terms of the timing, the current language is, you know, maybe a bit convoluted unless you're a finance insider, but it says that the timing of general obligation bond elections shall be determined by the inventory of current authorized unissued bonds remaining to be sold. An estimated two years of authorized unissued bonds shall remain before an election will be held. Really, the intent there is to not be bringing forward the next bond election, when we still have a lot of projects that haven't even been delivered from the prior bond election. I think a cleaner way to say that, in collaboration with our interim cds director, Eric bailly, and our financial team, I think cleaner way to simply say that is that a new [10:03:01 AM] bond election shall not be held until prior bond programs have reached substantial completion, which we generally consider to occur when approximately 90% of bond program expenditures have been incurred. So it really be clear it really gets you to the same place. This is not really a change in practices or how what the timing of a bond election would be. We're just trying to get cleaner language, and we're also trying to clarify the point, which I believe councilmember alter brought up is sometimes these bond programs have very long tails. You might get to 95% expended, and for one reason or the other, the final 5% takes five years to deliver because there's a hang up, an environmental issue, something that has to be worked through. Staff is always implemented. This, as long as I've been here, has looked at this criteria. About two years of bonds remaining to be issued as two years of bonds remaining to be issued to get to substantial completion. If we weren't administering this in the manner that we have, you know, we we wouldn't be having very many bond programs because there seems like there's always some sticky widget in regards [10:04:01 AM] to a project that has challenges and ends up getting delayed. So this clarifies that what we're really talking about is achieving substantial completion. And again, the intent being let's not go to the voters for the next bond election, when we still maybe have a lot of projects that haven't been delivered that we promised from the previous bond election, the, the, I think, related criteria. I think these really work best when you think about them in tandem is, okay, how big are we going to size the bond programs? Currently? We talk about the total dollar amount of bond. Election propositions shall not exceed the city's estimated ability to issue said bonds within a normal six year period. While I don't think it's the intent of the policy, I think it does open as it's written. I think it does open the door to, well, we could size a bond program to $500 million and say, we can deliver that in six years, but it might be sized in a way where one proposition has enough money for all six years, and another proposition runs out of money after one year. [10:05:03 AM] And I think that's some of what we've heard. So what I thought we could do to kind of clarify that language is not talk about the total bond total dollar amount, but to actually speak to the bond election propositions themselves, with the idea being we do want to promote sound financial planning and capital project planning, but the individual propositions shall be sized. And I think importantly, adding this language implemented, they need to be thoughtfully sized and implemented in a manner consistent with the six year project delivery. So, you know, the idea being that we want to have a holistic conversation with council about what the priorities are related to the capital program, you know, go through a brief process bond, election advisory, task force process and community engagement process, have discussions about tax impacts. And you know, what level of taxes is the body willing to to have incurred in order to implement the bond program? But to do that on a predictable six [10:06:06 AM] year cycle so that we don't have to be in a situation where we have one off elections, and I think it's been proven in the past that this is achievable. I think cds is currently doing a really good job with doing substantial planning leading up to a bond election, so that we can feel confident that, hey, we are sizing these propositions in a manner that they can be delivered in six years, and we're not undersizing a proposition such that it's going to run out of funding after two years. And hypothetically, we don't have any park maintenance that can be done for four years because we've undersized that proposition. If you take that in combination with the sizing them for six years and calling a bond election when you hit substantial completion essentially would look like this. And I wish I had added to this. But, you know, take the this is hypothetically a33 bond cycles, each being sized to about six years. So we got the green cycle, the purple cycle and the the blue cycle. But [10:07:07 AM] think about on that green cycle 18 months. You know, prior to that we would be doing the planning work. And that's what capital delivery services has been doing 18 months leading up to a prospective bond election, which would be year zero. The bond then gets implemented over six years. The percent spend is, of course, very hypothetical, but it's typically what you'll see in the early years of a bond program is lower levels of spending. As the design work related to the projects is occurring, and then as the construction contracts are lit and construction construction starts, you see the spending ramp up. But we would hit substantial completion in in year six. And then there's going to continue to be spending on the green bond program after that until all the projects complete. But the idea being in year six when we still have 90, you know, when we have 10% of the green bond program money left, we would be out to the voters seeking the next cycle of bond funds. And again, not shown on this slide, but should have been is 18 months prior to that year zero [10:08:08 AM] election. On the purple bond cycle, you would have a planning process. So you you know, you would be starting probably around year four and a half, four and a half, year four, four and a half of the green cycle. You'd start planning for the next one and then call the election once you hit that substantial completion. And then same story for the blue. So I think several reasons why I think this six year number came up talking to one of our former cfos, who was with the city for a long time and had a lot of influence on our city's financial policies, said the thought process at the time. Behind the six year cycle had to do with the city's five year forecast cycle. So a lot of times, bond projects, particularly if they're like a new fire station or a new library, they have operating costs associated, associated with them. And so you kind of want to size your bond program in a way that fits in with your financial forecasting. And quite frankly, you get much past five years on your financial forecasting. And it gets it gets really iffy. It's hard to predict the future that [10:09:09 AM] far in advance. So what we want to be able to do is to say, okay, we're looking at a bond election that would cover six years and it includes new facilities, and those new facilities have been built into our financial forecast. And, you know, we have a complete picture of the city's ability to pay for the opening of those new facilities. You know, I think you also want to be careful not to make them too much shorter than six years, because then you start looking at something like a large facility, like a new central library, and you can't necessarily deliver it in six years. And you might be in a situation where you're back asking the voters for more money, and you haven't even delivered, like the, you know, the pinnacle project from the prior election. So that's just the thought process behind the six years. And stop at that one to see if there's questions about these recommended changes. >> Council members, questions. Councilmember Fuentes. >> Yes, thank you. Thank you for the suggestions here on the policy changes. You know, I have to admit, I'm concerned about both of these [10:10:09 AM] recommendations, especially, you know, prescribing six years right out front, knowing the context that we have right now with the bonds that are currently unissued, for example, even with our affordable housing bonds, you know, we had them presenting to us at work session a few weeks ago. Or maybe it was this last committee meeting and, you know, there was nuances there, especially even with the word implemented. You know, they have well, we struggle to get clarity of how much of the affordable housing bonds are currently not obligated or not earmarked for any of the programs because some of them are are the rider program, the rental housing assistance, some of those, some of the fund dollars from from the bond are application based. And so how do you account for if you're saying you have to be 90% implemented, how would that look like with a affordable housing bond? >> Well, the 90% has to do with expended. So. The so the [10:11:11 AM] implemented here is to say that if we if we go through a comprehensive bond program and it's a six year cycle and the city council says we want to spend trying to think what would make the math easy, $120 million on affordable housing over six years? Well, we as staff then need to make sure that we're implementing it in a way where we're spending roughly 20 million a year on affordable housing projects so that the the program can be sustained for the six year period, because that would be the direction that we receive from the council and the approval we receive from the voter, as opposed to council approves 120 million for an affordable housing bond program. And then staff goes out there and burns through it all in one year. And that's. >> An excellent example because that then we get we are in a situation where staff is only spending 20 million a year so that we we are we maintain the pace of implementing on a six year timeline versus understanding the market conditions we're in and wanting to, you know, have the land acquisition dollars to be able [10:12:11 AM] to buy property when the market is favorable to the city, or understanding the unique housing needs of our residents, and being able to provide affordable housing at a level and a scale that meets the moment. And so that's that's why I'm a little concerned about putting the 90% implemented. And even the word implemented in the level implemented. And and I appreciate that you have this the implement this visual the chart here. How would if we currently assessed our our current 700 million of authorized but unissued bonds that the city currently has? How would they fare on this metric with these two proposed policy recommendations? What would the transportation bond? We know that that's the majority of our unissued bond dollars. What would they be at, 65%? 70%? Because even if we went down that route, then I would say, but the vision zero program portion, funding of the transportation bond has been [10:13:13 AM] completely expended. And that's why we need to go out for a bond to be able to continue that program and continue the safety treatments. So, colleagues, my concerns are just a little bit I appreciate the direction. I understand that we we're all we all believe and want to get on a regular reoccurring bond cycle program. But there's context here and the current state of our bonds. And knowing that we are currently considering a bond package for this year that I that I worry with the specific bond or the specific policy language that we have here, I wonder what that impact might be with the current situation. And so I think those are or. Mr. Benigno anything else to add on your end? >> Well, I would just say in regards to the current bond program, I do have the total amount looking at 2016 bonds that haven't yet been spent, 2018 and 2020 bonds, not including the housing dollars that was excluded from the slide that Mr. Bailey presented. [10:14:14 AM] I think at our last audit and finance committee meeting that they're projecting to hit 90% obligated in 2027 and 90% expended in 2028. So that's the current projections for our previously approved council bond programs. Now, you're 100% right that the propositions and and even the programs within proposition. So we might have a lot of street money still to get through. But we're out of money for sidewalks. So even programs within propositions could sometimes run out of money. And I think that's to me, that's a case for what we're proposing here in terms of the policy, is that we've not been as disciplined in regards to the sizing of prior bond propositions and then as strategic in the implementation of those propositions, so that we don't end up in a situation like we are now, where we're all out of sync. And I think part of what we need to think about if when there's another bond election is how do we get [10:15:14 AM] things back into sync. So we're not having the challenges that we are right now. And I believe these financial policies can help this council and future councils achieve that. >> Would you have the information with the parks proposition where we would be at on that end? >> I've, I've heard I know Mr. Bailey is in the audience. He might have more for me, but we can also respond to you know, is that when it comes to the park maintenance aspect, we're short of funding there. And so we have internal crews that do maintenance at recreational facilities and parks and that that program area is running out of funding. And so we have been having conversations with assistant city manager Rogers about, you know, what are some strategies outside of going to the voters for more money to continue those programs while we're trying to get things back into sync for a comprehensive program that would, you know, get us back on to a more regular six year cycle. >> Thank you. >> Councilmember Laine. And councilmember Siegel. >> Thank you so much for this presentation. I definitely [10:16:15 AM] appreciate the importance of getting back on this regular cycle, and I'm happy to see it presented this way. I think that I would like you to correct me if I'm wrong on this, but I think that we can only successfully meet these criteria. For example, the 90% of program bond program expenditures incurred if we are consistently bringing forward programmatic bond language, because that's the only way that we I mean, I believe that's what we've heard as we've been discussing previously. >> I just want to be maybe you can clarify in the language you got, you know, propositions and just explain my language. We have a bond program, which is like the whole thing. It might have six propositions in it. And one of those propositions would be transportation. And then within transportation, we often start talking about programs again, like the sidewalk program within there. Or maybe just talk about those, as, you know, sidewalk projects. [10:17:16 AM] But that's how I would look at propositions versus programs versus propositions. And then, you know, maybe programs again. >> So if we're thinking that. If we're thinking that we need to make sure that we're spending $20 million a year on mobility, it is easy to shift things around if you need to in order to stay on the financial track. But I think we've gotten in trouble in the past when we, for example, had money, bond money that was towards specific named areas or entities. And so I think we could easily get into a situation where it's more than 10% not expended if we don't maintain discipline on the way that we're using that language is making sense. >> Yeah, I think and I think part of the challenge we've had is some of the past bond elections had associated with them a contract with voters, which was a very prescriptive [10:18:18 AM] detailing of the projects that were going to be delivered, which does then create some constraints about the ability to move money around to meet shifting priorities and opportunities. >> And there isn't an effective way to kind of reset that clock either. And so I wonder if it makes sense to include some sort of language in the policy that relates to this issue, because I really think that if if it falls to the wayside and we don't, then we could end up in a very challenging situation where we cannot call for future bonds that are very needed because we've gotten hung up on some sort of sticky wicket that's more than 10%. >> So policy, maybe something is related to maintaining the flexibility, you know, of individual bond propositions to meet changing needs. We could work on the language and bring something back to the committee. >> Yes. And then the other thing that I worry about is, yes, we will continue to spend money so that it gets spent at [10:19:18 AM] the increments, at the pace that we needed to get spent. But does that disincentivize, does that disincentivize some of the harder things to solve that are still very needed. And so I this is not a policy perspective. But I wonder if there if thought has been given to how we would track things that are getting dropped because there's a tendency to pick the thing, you know, you can deliver and it and I'm worried about what gets dropped consistently. So I just want to raise that as an issue for consideration internally, not for a change to the specific policy language. Thank you. >> Thank you, councilmember, councilmember Siegel. And councilmember. >> Thank you, mayor and colleagues. And Mr. Benigno, this has been very informative conversation. I just want to pick up on a thread that my colleagues have brought up in different ways, and I think I would frame it as almost like a challenge as to whether we truly need to have a comprehensive, you know, six year cycle where all of the [10:20:20 AM] programmatic areas are synchronized. And this was something I brought up on the message board. But basically the idea that so as far as I understand right now, we've depleted most of our parks funding. There's some questions about housing, but some programmatic areas or departments might have a longer runway. And it seems like there could be a way where we have a bond program that meets the goals of, for example, maintaining our triple-a credit rating, smoothing out the debt burden on taxpayers so that we're not, you know, experiencing major bumps in people's property tax assessment related to the debt rate. Seems like we could accomplish those big picture goals, but also maybe split the bond cycles. So if this year we need more capital investment in open space and parks and housing, and 2 or 4 years from now, we need more for transportation and facilities, why couldn't we have essentially alternating six year cycles where some programmatic areas are dealt [10:21:21 AM] with in one six year period, and other programmatic areas are dealt with on a separate six year period, that still meets the overall needs of going for triple a and, you know, managing the debt burden for taxpayers. Question to you, sir. >> I certainly think you could structure something like that. I don't want to get, you know, too much answering off the fly, because I haven't really thought about what that might look like. But, you know, I think the key takeaway is, is to have a planned, predictable approach so that the policymaker can say we are setting policy to prioritize these things and not having to make decisions on a one off basis. So could you do that on an overlapping six year cycle that result with some propositions, one cycle and others the other? You know, I think you potentially could do that. I'm not sure that I'm aware of other cities that have tried that, but I don't want to say offhand, I don't think it could work. But I also haven't really had time to to think through it all about how you might be able to do something like that. [10:22:21 AM] >> Mr. Rogers. >> Thank you for that question. I could. >> Potentially see with having these staggered bonds in each one of the categories at a six year period, potentially posing some issues for staff and the staffing, because how, when, when everything is all at the same point, the whole bond, the initial part that that Ed talked about that 18 month period. Now it's constant. It's every year you're going to be doing something. And by doing things in the way that we're doing it right. Right now, having a six year package for all of them allows for be stiff for staff, for others to all be unified on the same page. And so each, each referendum would just be a constant situation where you'd have be tiff out year after year after year after year for every single initiative. So I could see some initial concerns with what you had just brought up. [10:23:22 AM] >> Thank you. And just to kind of follow up on that, I guess kind of what I'm trying to get at is convenience versus necessity, right? Because we heard from councilmember Fuentes, like there might be emerging community needs. For example, let's say that the market is particularly favorable for a public investment in affordable housing. And that's something that we can't wait four years to take advantage of the market opportunity to lock in a bunch of high quality, affordable housing. And so having to wait for the next six year cycle, we could miss the opportunity. Or we might have an area of substantial growth in our community where we really need a fire station in one part of town, and we don't want to wait for several years. And so I guess, and we don't have to answer this today, but I think what you described is it would be a dramatic impact on operations and workflow for, for staff if we're kind of in a continuous capital improvement cycle. But at the same time, we do capital improvement budget every year as part of our our budget process. Right. And so I guess what I don't really understand is would it is it just more convenient to have [10:24:22 AM] the comprehensive six year cycle, or is it really essential? >> I would say it's it's probably more convenient than essential. Right now because everything is aligned, all of the all of the parties who are dealing with it, the architects are, are mainly looking at the issues of, of ensuring the estimates are correct at this particular time, and it can be done. Let's just put it that way. It can be done. It would just be a change of the process that we have today. And I just wanted to add a little bit about some of the other things that I've heard. I think with the situation that we have with many of the older bond projects and trying to get them caught up, it's it's a situation that we've realized that there were issues in doing those initial estimates. And this is why cds was developed to eliminate many of those errors and issues. So [10:25:24 AM] I know we're going to be a little bit off cycle right now, especially on the transportation side. But once we complete those projects, those corridor projects, I think we'll have a better cadence and we won't have this situation where those corridor projects are kind of weighing down the rest of the transportation initiatives. >> Maybe one other consideration that came to mind is acm. Rogers was speaking is coordination with our other taxing entities. So, you know, the school district is doing their bond, bond, elections and bond cycle, and Travis county is doing theirs as well. So if the city were to be on a kind of like a overlapping three year cycle, I mean, you might have situations where the city is going to the voters and then the school district and then the county and then back to the city. And that might not be there might be some voter fatigue associated with that type of cadence. >> Thank you. Mayor. Thank you. Councilmember. Councilmember alter, the mayor pro tem. [10:26:24 AM] >> Thank you very much. I want to kind of take a step back for a moment. And first off, really do appreciate some of the clarification here. I think the intent is really good. It's it's the implementation that I think we're all grappling with today and why this is not as straightforward as the policies we've had or the ones that maybe we've put on paper today. What I think at the highest level, we have to do a better job of and really focus on is what policies are going to lead to project delivery, right. If we're going to go to the voters and say, we are asking for you to approve this or that proposition, we have to have a process in place that leads to that park being built, that library being built, those sidewalks being delivered in their neighborhood. And I really worry about our current process not being geared [10:27:27 AM] towards that. I think we've made some really good improvements to the decision. Tree was the first towards pointing us in that direction. This conversation here today, I think, is another meaningful step in that direction, but I still have great concerns about, number one, in talking about a six year cycle, asking the community and this council to guess, and it's an educated guess, but to guess what are the entirety of the needs for a city of a million people over the next six years from a capital perspective? And then how much do we think that's going to cost? And then how long do we think that's going to take? Inevitably, we we don't always get it right. And and so is there a better way to structure this process, whether it is a more iterative process like councilmember Siegel is talking about or shorter horizons? You know, I think these are open questions. I don't come here, unfortunately, with all the answers, but I [10:28:27 AM] want us to explore some of these questions because I think there might be a better way for us to ultimately get to that delivery and make the public believe that when I say yes to the proposition, that means the park down the street is going to either, you know, have the swing set that's not broken or we are going to have that new library in my neighborhood. I did go back and look, I was curious on how long the central library took to be built. Four years. And I my understanding of our process now in that pre- planning phase that you talked about, you know, is is hidden on our slide, is that we would get to a point in that pre-planning where once we go to the voters, it may not be ready to turn dirt tomorrow, but we're much closer to that groundbreaking piece. And so I think this, you know, six [10:29:27 AM] versus five versus four. Would be an interesting question. Just kind of look at our projects. And and I think most people would say, you know, what should take six years to deliver? That's a I can think of certain big, big projects and, and stage projects. But then also on what councilmember Fuentes was talking about with the 90% completion, if we I think there's value in looking at a proposition, but also if that is a hard and fast rule, if you just look at the 2018 bond from a parks perspective, a little over 20 million of that was for the Doherty arts center. Well, the Doherty art and the parks department in that proposition, about $150 million. Right now they're asking for another, I want to say 20 or 40 to be able to build it. And so if you don't have a plan for this bond, you're never going to satisfy the 90% completion of the last bond. And it's a, you know, a chicken and egg issue. So there [10:30:30 AM] are always nuances. There are always issues. And these policies are meant to be guidance. Right? We've broken policies in the past, but the idea is to build something that is lasting. Right. So I just I wanted to kind of pull pull that back a little bit. And, and the other thing I'm curious about from your perspective, hcm Rogers, I actually thought you were going to give a different answer to what councilmember Segal mentioned, because right now in in the meetings I've had with cds and we've talked, you know, we are throwing a city's worth of planning at capital delivery services and say, go plan our parks, our roads, our watershed. You know, all these things. Look at the engineering and the pre-planning. And if instead they were only tasked with, okay, for the next year or two, look at our parks and our roads, everything else, we're going to deal with that in subsequent years. Wouldn't that make staff give them more time and more [10:31:30 AM] just steady stream of work instead of four and a half years kind of delivery and then huge spike in, you got to do all this pre-planning and then back down to delivery. >> No, I, I don't disagree with that. I don't disagree with that. As, as I'm thinking through the discussion, I wanted to I wanted to be able to. My first thought was how we're doing things now is correcting those issues that were issues of the past. And that's where I'm thinking, okay, we're getting projects done the correct way now. And so that's why my mindset went there. But as we go through this, you make a very good point. You make a very good point on that. And both of you made very good points. And I think not necessarily even from a staff standpoint, is btif and others having them constantly going out and we're constantly having [10:32:31 AM] a bond initiative every single year versus having more of a fixed cycle. I just think it in my opinion, it's easier for the community to be able to to have a bond cycle, that it's more consistent. But you make a very good point. >> Two, two more things. One is the short. I just think also within these policies that we might want to explore our economic development bonds versus not. Right. So housing bonds are economic development bonds required for the voters to approve. And so do we want to think about those differently. They're also differently different just in how we implement right. The housing department writes a check. Or if we did some economic development that would be writing a check. It's not getting crews on a road to, you know, build something. It's it is. We've always those dollars have never had trouble being spent. Let me put it that way. If we want to spend all our affordable housing dollars this [10:33:31 AM] year, we could do it. It would not. We would just write a bigger check. Right? The need is there. So just, you know, also some of the first thing about is that something we want to do. And then the last thing is a question of maintenance, both looking at the proposed staff list as well as just, I think the expectation of the community is let's take the central library again. For instance, the community said, build us a central library. We really want it. Inherent in that, I believe, is if that library needs a new roof or a new hvac system, we want you to fix that. We don't necessarily think you need to come back to us and say, should you fix the roof? Should you have that hvac system? And we have the tools to do that? If I'm correct, and I just wondered if you could confirm that for me. >> Yeah, we do have the tools to do projects like that. You have to be specific facilities. [10:34:32 AM] But yes. Generally yes. >> Okay. And so I think that's something that we should explore as well, is if something is maintenance related, whether that's park maintenance, facilities maintenance, we have explicit authority to maintain those things. And I think the public, when I speak with people, think we're doing that and should be doing that. But if we're talking about going and building a new central library, building a new pool, whatever, something new that adds maintenance costs, that I think is a distinction of when we start talking about voter, what the voters should be asked to approve, because those are large expenditures that then have long ongoing maintenance. So just that's food for thought. I wish I had all the answers, but more questions than answers today. >> Thank you, mayor pro tem. >> Thank you. Mayor. Just I understand thinking about the six year bond cycle, what I, what I like about the six year bond cycle is that we compare [10:35:34 AM] all of the capital needs in the city against each other during that that bond cycle. And so there's a that we really have to kind of make, prioritize and make decisions saying that, yes, we want to do this, but we really need to do this. But it just when I think about, I mean, Austin energy, Austin water, again, I'm not as familiar with the enterprise funds capital investment bond cycles. I don't see any real compelling reason to not have it. We want to have parks, for example, on a six year capital improvement cycle. But do we need all of the departments on the same six year capital improvement cycle? I'm I guess I'm just kind of struggling with that question. I don't I don't feel like we do. And I'm not hearing kind of a again, I understand the convenience. We want to make things as, as, as easy as possible for staff, for, for our committees and those kinds of things like that. But and again, just thinking about the parks situation and to the and [10:36:36 AM] to the language there, I don't have a problem. We're also assuming, again, that everything is going to get approved in a six year bond cycle. And that may not happen. And then, you know, the next two years cycle, we may actually we pay voters know we really actually do need some money for this and and go back to them on, on a, on a different proposition. So you know again I'm not I'm not sold on that that, you know, just hammering in on that that six year bond cycle. I just, you know, share those comments with with my colleagues and with staff. >> Great. Thank you, mayor pro tem. And I'll just say real quickly that, that. This is the beginning of this discussion. This is the first time we've we've had it laid out. So and it's a very good discussion and important. The one thing I would add to it is that a whole lot of what how we're discussing this is based upon the current situation we find ourselves in. And, and let's [10:37:38 AM] say the word politics may have played a role in how many bond elections we had over a period of time and how frequently we had. And of course, politics will always play a role in. I know everybody's surprised by that. And but but let's just say it out loud and it will always play a role in when and what is part of a bond election. But as we analyze our policies, I think it's important that, as the acm Rogers has pointed out, much of what we're looking at now is correcting some of the violation of policies of the past. And so let's be careful that we don't now create a policy where we're allowing the tail to wag the dog because we're having to correct things, and we don't like the fact that we find ourselves sitting in these seats at a time when there needs to be correction. Let's let's keep in mind what the, the, the policy needs to be going forward. But I think we're having a good discussion [10:38:39 AM] in that regard. I just want to highlight and emphasize that. So Mr. Van chito, I'll ask you if you have anything more you want to add or Mr. Acm Rogers. >> I do. I have one more slide, but I don't think it's going to be controversial. And then I'll just have. >> Yeah, well we'll see how right you are about that. >> So the final policy area is in regards to reimbursement resolutions. This is a debt management device that the city of Austin uses to consolidate our bond sales. So every time we need funding for a project, we don't go out to the market to issue bonds. What we do is we incur the expenses first and then we. Issue a reimbursement resolution. Essentially, council states its intent to reimburse ourselves with debt in the future for expenditures incurred today. And what that allows us to do is to take expenditures that have maybe happened over a year or even a two year period, and consolidate them into a single market sale, which saves us on issuance costs and staff time. And there's a lot of a lot of [10:39:39 AM] work that goes into doing a bond sale, whether it's for a small dollar amount or a large dollar amount. So there are a lot of advantages to us using this reimbursement resolution process. All that to say, this policy has a second sentence that I don't believe is necessary. It says that reimbursement resolutions may be used for any project which is on the bond sale schedule, or is revenue supported. I'm just here to say that even if there was a urgent expenditure that we needed to make using debt and it was something that wasn't on the bond sale schedule, we would put it on bond sale schedule and do a reimbursement resolution anyhow. So I view this as a cleanup item. The second sentence of this policy is just not needed or helpful, so we're just recommending that we eliminate it. Then just to close out, I would just say as you as we continue this conversation, I would encourage council to look at these policies. It was mentioned as guardrails. You don't want the policies to be overly prescriptive, but guardrails within which staff [10:40:41 AM] operates to implement in this case and to manage our debt to implement bond programs. We have a lot of financial policies, but they're all intended to be guardrails that council establishes within which staff works. And if we make those guardrails too narrow, you probably get some consequences you don't want, because there's not enough flexibility to adjust to changing circumstances. And you also don't want them to be overly wide. The policies that we've tried to write are intended to capture your policy objectives, but not be overly restrictive. So in regards to the. The 90%, the substantial completion, we we use terms like approximately because in the example you raised, maybe that gets us to 85% and there's a reason for it. And it's reasonable that in that situation, substantial completion has been met. So we do want to make sure, as we go through this process that we're capturing the right language. So we're not being overly narrowly prescriptive, but also [10:41:41 AM] not being too broad. And so that's what we're trying to accomplish with some of the recommended changes here. >> We appreciate your acm, Rogers. Yes, yes. >> And in closing, I do I think the mayor articulated it very well. We are in a position where we have been trying to correct some errors that have taken place in the past, and what we what we're looking at is trying to set the framework where we don't go down this road again. And, and I and I believe that the team is doing a fantastic job. Now, when you look at the, I guess the last 4 or 5 projects that there's been ribbon cutting ceremonies on, these projects are on time and on budget, and that's what we want to do. I think we have to get to the point of making this correction with those corridor projects. And once we do, I think we will be in a much better situation overall. And I do think, you know, and just to bring up the housing item, we [10:42:43 AM] do need more conversation on that one. And so I think with the policy, the policy should be one that gives the flexibility, put things in a in a position where there's some certainty. But as policymakers, there's going to be certain situations that do exist that you all can make the change when necessary in any particular area. So I'm happy that we're we're looking at a policy that can look at somewhat of a standardization of these processes. So we don't go down the road that we've gone down. >> Great. Thank you. Members. Unless there's objection okay. >> I just want to thank you for putting this on the agenda. I think it's a conversation we need to be having for months and the last that I know, I was glad that you is you put it in the decision TRE, but also for consideration the affordability question. Is there a way to have a policy around ensuring that we are balancing the the [10:43:44 AM] tax burden on residents? So that's just a closing comment. >> Thank you very much. All right. Thank you for all the work and good first discussion. Good good first open discussion. That'll take us to item number four which is board and commission proposed bylaw amendments for the commission on aging. >> Hello again. Stephanie hall deputy city clerk. And I'm here to present some proposed bylaw amendments for the commission on aging. These bylaw amendments actually came to the committee last year and were asked for to hold off for some review because they want to create a committee and that requires some additional staffing. So I'm bringing these back after some discussions with the staffing department. The red line versions are in the backup, and there's also a document that outlines what the actual changes are. There's really three sections that are being altered. Two are kind of administrative cleanup. The city clerk's office has taken over the general staffing for this commission, so it's to clean up the reference that the city clerk now is staffing that. [10:44:45 AM] And then the the the heart of this is the adding of a committee in article eight a they want to create a new age friendly advisory committee. The general idea of this is so that they have a dedicated committee focused on offering advisement to the age friendly Austin action plan. Staff is in support of these amendments, and after discussing with the Austin public health, they have agreed to staff this committee with the understanding they meet no more than quarterly. So that is what I want to present to you. And also, I was hoping just to get a little bit of feedback from the committee about the general bylaw process. I'm just kind of dropping this on on you. So if there's a better time to discuss that, that's fine. But with the review process that we have set up, which we'll talk about a little bit later in the meeting, there is already kind of a cyclical process that we've established so that the boards and commissions can review bylaw amendments. So this was something already in the works. But we are kind of asking for feedback if we could perhaps request that commissions that are looking to adjust their bylaws with membership or scope, that they may wait during the [10:45:45 AM] time that they are being reviewed, their reviewer cycle time? It might be the most practical for those bylaw amendments, so I'm just kind of looking for some feedback. If that is something that you think that we might request of boards and commissions before, of course, there's going to be times when it might be more urgent if they're not being reviewed for a couple of years, and we could bring those at that time. >> So first of all, miss love, we do have anybody signed up to speak on this because we have in the past. >> We do just have Jose, who did not show up for the other. >> Mr. Garza, have you appeared? No. Okay. Thank you. All right. With that being said, we have we we are posted to consider this specific set of bylaws. I would suggest that if we're going to discuss a new process, we probably ought to be posted for that. But you can seek input from anybody that you want to in that regard. With that being said, is there is there are there questions of the clerk's office discussion [10:46:45 AM] that you want to take on this? All right. In that case, I would entertain a motion. With regard to the proposed bylaws and as a recommendation to the full council, the mayor pro tem moves approval of the proposed bylaw amendments and recommend them to the full council. It is second by council member duchen discussion. All right. Without objection, that will be recommended to the entire council. Miss hall, thank you again for your good work. Thank you. Members, that will take us to we have four briefings today and the first briefing is on flood. The flood preparation audit. Who's going to present on that, Mr. Auditor? There you go. Okay. As they're coming forward, I want to point out, since we're talking about the watershed protection department, and we also have what we had. Where there he is right there. He ran around on me. The director of the watershed protection department is here with us, Jorge morales. And I [10:47:46 AM] would like to point out that we're very proud of our director. He was named the Travis engineer of the year by the Texas society of professional engineers. And, you know, we're so proud of our staff, the professional public servants that we have working for the city of Austin. And we don't always call it out. And a lot of folks don't always know about the good work that gets done and the recognition. But what a high honor and you make us very proud. So I wanted to call that out. And then let's pray the audit's good. No. I'm teasing. Yeah, yeah. >> Good morning everyone. My name is Kendall byers, and I'm here with the Austin city auditor's office to present the results of our flood preparedness and awareness audit. The objective of this audit was, is the city addressing flood related risks and informing the public about how to handle them. For this [10:48:47 AM] audit, we focused on flood related activities before a flood event occurs. Austin is located in what is commonly known as flash flood alley. This means that floods can happen quickly and can become severe. The city also has a history of flood emergencies that have resulted in damage that has cost millions, as well as the tragic loss of life. Updated rainfall studies show that Austin now faces heavier rainfall than in the past, and as a result, the floodplain has expanded and more buildings are now located within it. Everyone in the city faces some risk of flooding. This can come from overflowing creeks or heavy rain that pools and floods on the streets. Our analysis of Austin 31 one flood related service requests show that approximately 90% of requests originated from outside of the mapped floodplain. This demonstrates that residents and visitors don't need to be in a floodplain in order to experience flood risks and impacts. Our first finding is [10:49:48 AM] while the city cannot fully eliminate flood risk, Austin watershed protection has a robust has a robust approach to flood preparedness. Dwp's flood preparedness strategy is an ongoing year round process. This includes mapping and regulations, flood damage reduction efforts, warning and response processes, and public information campaigns. The department uses the most up to date rainfall data to create maps and models to show flood risk. They also use strict regulations to manage development in the floodplain. The department reduces flood damage through capital improvement projects such as the waller creek tunnel. They also manage and maintain a vast network of stormwater infrastructure. Awp has a flood early warning system that monitors and communicates flood conditions prior to and during a flood. They've also developed an emergency management program that expands their capacity to [10:50:49 AM] prepare for and respond to flood emergencies. The department conducts year round ongoing outreach to inform the public about flood risk. Some of their efforts include community outreach events, use of social media, and providing online tools and resources. As a participant in FEMA's community rating system under the national flood insurance program, Austin currently holds a class five ranking. This provides residents with a 25% discount on flood insurance. Of the 74 Texas communities that participate in this program, only two other cities have a higher discount rate than Austin. While awp has a robust approach to flood preparedness, we found that the department could do more to ensure that residents and visitors are aware of flood risks, and that the department has the necessary data to plan and measure their work. When compared to leading communities. We found that Austin's flood information is often buried in [10:51:50 AM] lacks clear, plain language explanations. For example, online users must navigate through several external links to get to core flood preparedness information in terms such as flood watch and flood warning are not always clearly explained. We also found limited, tailored guidance for vulnerable populations such as older adults, renters, unsheltered population and visitors. When reviewing social media, we found that awp did not always consistently share flood alerts across platforms, and Spanish language messaging was not always consistent. These gaps may leave residents and visitors uncertain of their flood risk, and what actions to take to prepare for a flood. We also found limitations in how flood related data is collected and used. While creek flooding risks are modeled using advanced technology, localized flooding responses rely on Austin 311 service requests. This reactive approach may prioritize areas with more [10:52:50 AM] reactive, more active reporters, rather than areas with the highest risk. We also identified inconsistencies in how maintenance data is recorded and work order systems. These minor data issues may impact the department's ability to measure progress, identify trends, and prioritize their work effectively. For example, we found instances where work orders completion date was before its reported date. There were also work orders that did not have a problem code to identify the problem that they were correcting. We made two recommendations for this audit. First, to minimize the loss of life and property, awp should work with the city manager to ensure residents and visitors receive clear, consistent and accessible messaging about flood risks. This includes targeted outreach to vulnerable populations and more prominent plain language information. Second, to strengthen risk prioritization and performance measurement, awp should standardize required data elements, improve quality assurance processes, and align [10:53:51 AM] policies and procedures with clear data standards. I'd like to take this time to thank awp for their partnership and their commitment to improving flood preparedness. I also encourage everyone to sign up for local emergency alerts at Warren, central Texas. This concludes my presentation and I'll turn things over to assistant city auditor Keith Salas. Answer any questions you may have. >> All right. Members, do you have any questions? Yes. Councilmember Fuentes. >> Yes. I mean, this question is more for director morales. >> Yeah. Why don't you come up if you want to say anything, and then we'll open it up for questions. I'm glad you you did that, councilmember. >> Good morning. Mayor. Council, first of all, thank you for your kind remarks. It's a team effort. So the award is really a representation of the professionalism at the city of Austin. And so yes, I want to acknowledge the two recommendations. We do agree with them. And we actually presented some strategies. And by the end of the year, we'll come back, give you some updates on those strategies as we move forward. It is aligning nicely with our strategic plan update, which we will be [10:54:52 AM] bringing to you in the next few months as well for adoption that we heard from our community. It was very community focused strategic plan update and we heard- similar concerns, comments from the community. So that's what we'll be bringing back to you as well. >> That's great. Thank you, councilmember Fuentes. Sorry. >> Thank you, doctor morales, because that was I was my first question was going to be where are we with the strategic plan. So that's going to be publicized in the next few months. >> Yes, councilmember, we're actually reviewing the final draft right now. We will be presented to our city manager's team so they can give us feedback and then presenting it to the council as well. >> Okay. And as part of the because one of the one it's this audit. Thank you for the audit. It makes a lot of sense for us to to be vigilant on flash flooding and preparedness for our community, especially given that Austin is in flash flood alley and that we have a history of catastrophic flooding events happening in our city. Part of the recommendations that they've outlined here as part of the audit is just looking at the localized flooding and knowing that 90% of our 311 calls are [10:55:52 AM] about localized flooding issues. One of the findings from the audit is to is honing in on the need for staff to assess the data that comes in and make those connections for us on where we need to have, you know, capital improvement projects to strengthen our flood resilience and do the mitigation. Any comments on that and on how the strategic plan coupled with this audit finding of the need for us to use the data to inform our processes, how those will work together? >> Yes, councilmember, great point, and I appreciate the partnership with the auditor's office as well. It's been very professional and highlighted very important things. So our department was already working on some of those things. So we have a robust program as well for the localized flooding as well. We've been not only mapping our infrastructure but actually evaluating the capacity. The we actually other cities don't do this, but we actually TV inspect our systems as well. So we look at the conditions. And so we have a pretty robust asset management program we've been developing for the last ten years. So we are using all that information to drive the direction so we [10:56:53 AM] can do some of these projects in the past. We focus on the big projects, the big cip projects and localized flooding sometimes may not be a large scale project. Many are, by the way, because it's the largest, largest pipeline to the ground. So when you displace that, it affects other utilities, roadways, sidewalks and all that. So they are complex and complicated. But there are opportunities for small medium projects. So we are doing in-house projects. In the last several years we've put id iq contracts out there. So we're using those very effectively as well. Our in-house crews do a lot of maintenance and operations, but we also do some upgrades as well. So it's a whole list of things that we've been doing. And as part of the strategic plan, it's tied to the communications that the community is asking us to simplify. We're very technical. If you go look at our current strategic plan, it's very technical, a lot of formulas, which we understand, but we want to simplify it. So it will be coming out in a way that it's easy to understand exactly what it is and how we're going to prioritize and using the information from our community, not just the science base, but also the information from the community that's experiencing [10:57:53 AM] these, these floods as well. And it's no surprise to us, we know localized flooding is a big number. Complaints for the for the 311. And so working to refine how we use that system as well. And as you all know, the city manager's office helped us do some updates in the last couple of years. So we're going to continue to make more improvements on that as well. >> Very good. Thank you. Thank you for your leadership. And director morales, I'd like to request a follow up meeting with you and your team, and we can go over some of the strategies that you all have identified. >> We'll do. Thank you. >> Thank you, councilmember Fuentes. Thank you for your focus on on flooding. I know it's been important to you, councilmember duchen. >> Thank you, mayor, and thank you for sharing this. What I found very encouraging audit and the work that you've done to get there. I have a couple things I wanted to touch on. One is I'd like to better understand you've got this community rating system. I think we talked about the other day. I'd like to just better understand what the opportunities are. Risks are for moving up and down. Given that there's a apparently a financial advantage for homeowners and insurance. So [10:58:53 AM] I'd be curious to know what it takes, for instance, to move to from a 5 to 4 going forward, or if we're potentially have ever at risk for dropping our ranking as well? >> Councilmember, I'd be happy to answer that. If you'd like a FEMA program that the city has been part of. And last year we actually dropped from 6 to 5. That's when the benefit came from. And there was a council approved resolution that councilmember Fuentes brought forth that actually asked us to see what we need to do to keep bringing the score down. So we're actually in the process of hiring a program manager for helping us evaluate that. We're also working on a contract with a consultant to come in and help audit. What else can we do to bring that number? There's a it's a menu of items that we can continue to do, but to lower the score, we have to continue to do what we're doing and go above and beyond that. That's how we're going to continue to lower the score. So through regulations, through cip, through the communications process that we do all collectively, how we're audited every four years by FEMA. And that's how we we determine that rating score. [10:59:54 AM] >> Thank you. That's great. I'll follow up then to find out more about that program. And it sounds like you're well on your way to helping us build a strategy to do that. Yes, sir. The other thing I just wanted to flag is regarding the the recommendation for clear and consistent messaging on flood risk. And part of this is work that we did last year related to consolidating information for the our website, for our wildfire hub. And one of the things that we noticed was information was sort of living in different places. It wasn't exactly geared towards end users that were just trying to answer questions about how to take certain steps to say, improve the, you know, their safety of their home allegation, etcetera. So it might be worth a follow up conversation and look at how we approach that. Public information office was incredibly helpful for how we helped work with wildfire division to consolidate that. I know when I say even tried to find the audit alludes to it as it's the hub for flood [11:00:56 AM] information. When I try and find it online using those search terms, I can't find it. I have to find at flood safety to get there. So I sense that there are some opportunities there that we can talk about that might help align both with the work we did on wildfire, as well as potentially improve the usability of that site and how it's how owners are using it, or residents are using it to access information. The last thing I wanted to touch on was when we experienced the microburst storm last year. We had widespread flooding in my area and we had a lot of homeowners, I think, that were caught very unaware of their risk. And you were talking about like first story units in multifamily areas that are on hills, that or in areas that I think are prone or have risk factors that sort of had no idea that they even need to be considering carrying flood insurance, and also an expectation that they live in a multifamily property that thinks that we should be, you [11:01:57 AM] know, that that the homeowner association needs to bear all the risk. So I'm wondering if there are specific education we can do there, because I sense that that might be a gap, even just based on my own anecdotal experience there, where we had dozens and dozens of units of blood that were again caught totally unaware of some of the work that they could have done to help prevent that. >> A great point, councilmember. And yes, the answer is yes. We can do better on that. We do have several programs, education programs that that were identified that we could do better, and we're going to do more. So we're doing some flood flood annual events as well that started also by council member Fuentes. We're going to continue to do that annually. Promoting the events is very important, but also as we use the data to identify those risks that are outside the creeks, we're going to start communicating that more often. So everybody, renters or homeowners will know. And as you all know, we have a lot of visitors that come in and they're unaware and they come in for an event. And then we have flash flooding and they get caught. So we're going to [11:02:57 AM] continue. We do use a lot of media messaging that we do, but we're going to target some more for localized flooding and making sure people are aware that other risk. And so that that's part of the work we're going to be implementing as part of this recommendation. >> Okay. I look forward to it. And we'll follow up about both of those two items. Thank you. >> Thank you, council member, and thank you for the report. And thank you for the response and all the good work. I want to emphasize one thing that was mentioned at the end of the report from the auditor's office, and that is anybody within the sound of my voice. Sign up at Warren, central Texas. Over the past couple of years, we have worked very, very hard to make sure that there's better communication. And you've as you've heard this discussion, it's it's clear that we're doing more and more to try to make sure that the public is aware of what's going on. But and one of the key ways we we can do that is when people sign up at Warren central Texas org so that we can get them notifications. So and I always worry about my [11:03:58 AM] accent messing up. It's Warren W a R N not O R N Warren central texas.org. Even I can hear my accent on those circumstances. So thank you again and congratulations. And please I agree with you. It's a team effort, but it has to have good leadership. And I want you to also on behalf of all the council, I think I can speak when saying tell your team how proud we are. So thank you members, that will take us to item number six, which is a briefing on consultant spending audit. Thank you all. >> All right. Just getting over one seat. Let's see. My name is Keith Salas. I am an assistant city auditor for the office of the city auditor. And I was a manager who oversaw this project. Thank you for giving me the time to talk to you about this. And I will try to be speedy with it. All right. [11:05:00 AM] So the objective of this audit was to determine whether the city is effectively and efficiently managing consultant contracts. The reason that we focus on consultants is that we spend a lot of money as a city on consultants. Each year, roughly $93 million annually over the past three fiscal years, 23, four, and five. Consultant spending is broken up into two categories. We have general services and professional services. Professional services are things like architects and engineers, and they're a very small fraction of our overall consultant spending. The vast majority, about 95%, are general services. That includes management consultants, it consultants, things along those lines, we focused our efforts on looking at those general services. And these services are used by virtually all departments across the city. What we found is that the city may not be able to show why consultant services were needed, or how they were used. The way we came to this conclusion is we looked at a sample of contracts, 28 in total, and we found that about a third of them lacked a written needs [11:06:01 AM] assessment. So that was a clear explanation of why it was that we were hiring these consultants. And then over 4/5 of them did not have a formal evaluation showing why the work could not be done by city staff. Sometimes that may be obvious. If we're hiring an it consultant and there's only a couple people in the world or in the country who can do this work, we're not going to have that in-house. Other times, you know, like if we're hiring inspectors as consultants, well, we have inspectors as city employees too. And we might want to see that the evaluation to make sure that we're using our funds effectively. We also looked at deliverables. We found that in four of our contracts, staff could not show support, that they had received all of the deliverables they required. In one of the contracts we looked at, we found that the scope of work was missing. It was something that was referenced in the contract itself, but it wasn't there and staff couldn't provide it to us, so we weren't able to determine whether or not, well, we weren't able to know exactly what those deliverables are. And so obviously we couldn't determine whether or not we received them. And then in two other contracts, the contract manager, the [11:07:01 AM] original one, had left the city. The new people who were overseeing these contracts weren't really familiar with them and couldn't tell us where the documentation was, where the deliverables were just basic questions like that. In terms of the deliverables themselves, we generally ask that our deliverables are measurable, are specific, and are time bound. We found that about 16% of the deliverables did not meet those. So we saw things like assisted monthly committee meetings, assistant onboarding, assistant financing, assistant development and what exactly that looks like could be up for interpretation. So in order to be able to make sure that we're getting exactly what it is that we need from our consultants, we ask that they have those specific, measurable time bound components. Our second finding is that we don't consistently evaluate the performance of our consultants. So for almost two thirds of them, we did not have a formal performance appraisal. This is not something that's required, but it is best practice. And then again, we had those two contracts where the new [11:08:02 AM] contract managers just weren't even sure if they'd done that or not. Even when we do an evaluation, we don't always get an accurate assessment. The way that we came to this conclusion is that we reached out to the contract managers and asked them, did you receive everything that you asked for? Was it on time, those kind of basic questions. And one of these and this was not the only one, but I think a good example, they came back and said they'd received some, not all of the deliverables. The situation was that the contractor was unable to find a subcontractor to do some surveys. So we cut the contract short. We didn't pay them the full amount. That's all. That's all going according to our normal policies and procedures. But when they actually did the closeout, you can see here that first question were all services required provided. Well they said yes, we know based on our discussion that that's not true. They said that it was not applicable whether or not the termination had had been early. Well, we know that it had been. And the reason this is important is that this this [11:09:03 AM] consultant may come back looking for future contracts, and we'd want to know that they weren't able to do this to help make sure that we're not in the same situation in the future. Our last our last finding was an additional observation. This was something we noticed in one of the contracts were over $240,000. The consultant's name in the headline was not the same as the consultant's name in the body. And again, it's hard to hold people accountable and we have the wrong name. So our recommendations are that we provide clear guidance to departments on how to conduct needs assessments, that we work with the city manager to make sure that deliverables are maintained, along with other essential documentation, and that we require performance evaluations and lessons learned for all consultant contracts and use them in future hiring decisions. So with that, I'll take any questions you have. >> Thank you. Why don't we ask you all to comment and then we'll open it up for questions? >> Good morning, chair Watson. Members of the chair. Excuse me, [11:10:04 AM] excuse me. Members of the committee. Sorry, I haven't had enough coffee yet. >> I'm sorry. >> James Scarborough, Austin financial services chief procurement officer. I have with me, director Olivares, and we are happy to respond to the review and feedback of our colleagues at oca concerning consulting services contracts. Specifically, we acknowledge the the need for improvement with regard to the needs assessment. We do provide guidance to the departments with regards to reviewing their need for professional services, consulting services specifically, and to to document those needs. But to the extent that they're documenting them in a consistent way and that they are retaining them in the file and that somebody, including ourselves, are checking them in the file, then we think we can do a little bit better there with regards to performance evaluation, we have been evaluating our professional [11:11:05 AM] services, consulting contracts for design and engineering services for a number of years. We use a standard evaluation criteria, and we aggregate that those evaluation findings over multiple contracts to determine future evaluation ratings for those consultants when they apply for design projects in the future. That has worked out very well, but we just have not expanded that into general procurement. As as my colleague referenced, this review was of general services consulting contracts. And so this would be an ideal time for us to kind of take advantage of that, that that window and go ahead and expand our contractor performance evaluation beyond the design and engineering space and into general procurement as well. So we've started working on that last couple of months, and we hope to implement towards the end of the fiscal year. Otherwise, we are satisfied with the the [11:12:05 AM] depth of the review and look forward to implementing the the recommendations and further improvements in in how the city documents and records consulting contracts. >> Great. And Kimmel Harris director, financial services I also want to express my appreciation to the city auditor's office for the work on this audit. This this ties in really well to the the evaluation that's taking place around all of our various shared services in partnership with the budget organizational excellence team. And so one of the other things that we committed to is working with Boe on evaluating just consultant utilization in general relative to city staff capacity, capability, things like that. Also, as we look at as part of that shared services evaluation, I think the contract management titles and roles is part of that. So I think this really helps us [11:13:07 AM] address potential efficiencies and opportunities there, because the vast majority of contract management roles are within the departments as opposed to with the financial services. But we do set standards and, and and the sort. So we want to make sure that we're providing the best standards, guidance, information for all those folks throughout the organization. So again appreciate it. Great. >> Councilmember alter. >> I was wondering if you could help me understand something that I've seen a number of times over the past number of years. We'll get a contract on the agenda and it'll say, you know, $5 million for such and such consulting contract or, or could be a different kind of procurement. In year one, we only have $3 million in the budget. And so there's this gap between what we have and what we're authorizing. And the reason I'm asking that question is it gives me a little concern that especially in the [11:14:08 AM] consulting space, we might approve a very large consulting contract with, you know, pick your consultant. And then in the backup, it says, well, if you don't do this, you're not going to be able to analyze, you know, whatever critical service. But then three months down the road, there's a need for some kind of consulting service. And you say, oh, well, I've got $2 million worth of space in that consulting contract that was just approved. So I don't need to go back to council because I've got that authority that that gives me a little concern. And I'm curious how you why we do it the way we do it. And if there is a way for a better check on that kind of open spending. >> So one of the reasons why you'll, you'll only see that funding in the amount of X dollars is available in the current fiscal year, and then it's dependent on future budgets is and this is where I'm going to pretend I'm an attorney. There are limitations on binding future councils to various expenditures. So it may [11:15:09 AM] be a multi intended to be a multi-year contract, and therefore the dollars will be expended over two three fiscal years. So we can only speak to that first fiscal year specifically when it comes to overall authority of a contract and perhaps being able to use some of it for various needs. I mean, there's there's going to be unique situations for each contract. So it's hard for me to kind of speak to that in general. But regardless, each contract, there was a very specific scope of work that was utilized for the solicitation and ultimately the the agreement with the consultant. So regardless, any work done under that has to still fall within that scope of work. So because it would trigger all kinds of other issues if it were not. So if there are some if there's any certain examples that you're that you're thinking of, I'd love to discuss that with you to, to make sure that we're either [11:16:09 AM] providing better clarity with the council action or just a clarity with the departments on how they're utilizing these contracts going forward. >> Okay. >> Thank you. >> Thank you. Yes, councilmember Siegel. >> Thank you. Mayor, I just had a quick question on our total spend on consultants. The audit report has an exhibit a that I think earlier in the report, it says it's both professional and general consulting, but I'm not clear on that. So the $100 million, 102 million for fiscal year 2025, is that general consulting or general plus professional? I guess this is for financial services. >> I. >> I will. >> Oh, okay. >> Go ahead. And I. >> Believe that that was both we only looked for the sake of our samples at the general services. But that was the vast majority of it, I believe 95%, roughly of the spending fell under that category. >> So does this not include, for example, public health contracts? >> I well, if it's a if it's [11:17:10 AM] labeled as a consulting contract, then it would be included in that. Yes. >> The public health contracts referring to the social services contracts. Those are handled vastly different than what we're looking at here with the general and professional services, so that they would not be included in here. >> Okay. So yeah, so there are types of contracts for outside parties that are not considered consulting contracts. >> Yes. Those social services agreements are would not be handled the same way here. >> What would be the terminology for those. >> I that's where it because those and I, I don't want to dip my toes too deep into the water that I shouldn't be dipping in. Then to the social services they're referred to as contracts, but they're really they're social services agreements where there's often like they're providing services on behalf of the city, as opposed to us receiving the consulting services. So public health handles those. They don't go through the same kind of solicitation process that [11:18:11 AM] for our general professional services contracting. But I know I think as there's the conversations about social services agreements, and I call them agreements on purpose, because like the term contract has very specific implications. So those social service agreements, I think as those conversations continue about those, along with the budget process, we can dig into. >> That service provision versus consultation. And yes, okay. >> Thank you. Mayor. >> Yes, councilmember duchen. >> Thank you, mayor, and thank you for this, this report. I've got a lot of questions for audit that I'll follow up, I think, independently with, just based on the report and based on the presentation. So I'm going to try and focus on a couple of things. I'd like to get financial services help with. One is just like we my colleagues talked about some nuance around the bond earlier and the six year cycle. I'm curious about how we're thinking about nuance here. And two places. For example, one is [11:19:13 AM] looking at the appendix and looking at who's actually spending dollars on consulting. It looks like two departments account for roughly 45% of all consulting spend, and eight departments are something like 82%. So it seems like some departments are relying far more. And then some of those departments have a lot of variability year to year on how much they're spending, sometimes varying $10 million a year up or down. So I'm curious about that aspect of it and whether there's things that we need to better understand about how certain departments are using consulting services that may need to be baked into the documentation and procurement, etc. Things that you all are thinking about. And the second thing there is, and this is really more based on current events, which is I've been sensing there's more of a public demand around external validation for some of the work that the city does. I think about the efficiency audit that we just undertook, that we [11:20:15 AM] heard a lot of input that we wanted. Third party consultants and external consultants engage in that process. And so that's another related question to me, which is where would it be more appropriate? Where could we perhaps have the capacity to do things internally from a personnel or throughput, but where might be more appropriate for other reasons, to do things externally as part of the considerations that we make for consulting? So I'll start with that question. >> Excellent question. And so that's where the in our risk management response to the first recommendation, we specifically noted that we'll collaborate with budget organizational excellence on that capability. The capacity amongst existing city staff relative to the types of consulting services. So because right now I mean these these tables are are very helpful. But it's it's aggregate spending. It doesn't necessarily dig into within those general services within those professional services. [11:21:15 AM] What what categories of of consulting services were really being utilized. Because it may be it's it's completely reasonable for an outside consultant to be doing that. For it to be a third party. But we want to make sure that we're digging into that and more detail to make sure that we're not inadvertently spending dollars with consultants that we don't, that we could if we really dug a lot deeper and push ourselves, that we perhaps could deliver that internally. But it's so it's going to require some greater analysis. >> Okay. And I appreciate that, that a lot of this is a documentation issue and a procedural issue on your end. I'm also curious to the extent that currently under central procurement, we are directing all contracting under including the consulting, including even social services consulting. Is that is that correct? Is all of that moving through central procurement? Yes. [11:22:17 AM] >> Councilmember. Approximately 98% of total contract spend for the city is is associated with contracts under the administration of Austin financial services. As as director Olivares mentioned, there are some pockets of contracts that are sourced outside are administered outside of Austin financial services. That would include currently the what we refer to as the social service contract. They they they are a variety of different contracts. Some of them are contracts in the purest sense. Some of them could be categorized as consulting contracts as well. Some of them function more like grants where where they the city is providing a source of funding to incent an activity provided to other recipients and not and not the city. So we're in the process of working with the other departments to better sort those out so that contracts are more discreetly handled and administered and monitored, like contracts and [11:23:19 AM] other agreements and grants can be dealt with separately and appropriately as well. We we do provide guidance and we provide system support, and we provide procedural support to these other departments that do procurement, procurement like activities. But for the most part, that activity is overseen by Austin financial services, by our staff. >> Got it. Okay. Thank you for clarifying that. Two other questions before I know I need to hand this off here. First is, as you are going through this process for asking these questions and better documenting and so on, is there a need that you all have identified that you need more latitude or authority from council to make those recommended changes in terms of that could be everything from tools or guidance or something like that. For instance, would we need to give you all more control not to release funds [11:24:19 AM] under certain conditions? Again, based on things that the audit has identified in terms of defining measurable deliverables or the need assessment or lack thereof, etc. >> I think so there's there's a couple of things happening behind the scenes that would contribute to that to this, this concept. So first we're looking at doing some significant modernization of our systems that we do use for the actual solicitation process and contract development and management of those. So we're hoping to select that new system by the end of the spring. That will increase our capabilities and our capacity around just contract management and solicitations overall significantly. It will allow us also to have much better data collection data analysis capabilities. So I think that will contribute to us being able to answer your question more fully, slightly down the road. Also, we're we intend to [11:25:20 AM] come back to audit finance later this year to talk about various programs such as our our small and local business programs, various direction from council that impact our solicitation process overall, to be able to talk to you about what things are working, what things aren't working so well, where there might be some some advantages to sunsetting and so on and so forth. So we're hoping to bring that to you, to this committee here within the next few months. So I think as we work through those two, those two work or two projects that will be able to come to you later with any additional guidance or direction. >> Okay. I'll look forward to that. Last question is, given everything we've talked about, given the work that you're doing, do you currently feel like you've got the capabilities to make all of the necessary recommendations or implementations? Or is this a scenario where you might need to look to an external group or [11:26:22 AM] consultant for some help? >> No. I. >> Or is this an opportunity to show the rest of the departments how it's done? >> The irony of this, no, I think we're in a really good spot with our existing staff. I, James and his crew are incredibly talented procurement specialists, so I have full faith in them being able to complete this this effort with our existing staff and not relying on a consultant. >> All right. Well, I look forward to the updates. Thank you. >> Thanks, councilmember. Anything else y'all want to add? Okay. Thank you very much for the report. Thank you for the response. Members that will take us to item number seven and for scheduling purposes, my goal is to have us done by noon, which means that what we're going to do is we're going to defer item number eight. We will defer item number eight to the next meeting of the audit and finance committee. But that doesn't necessarily mean we need to fill up all of the time [11:27:22 AM] with item number seven. I'll turn to item number seven. >> Thank you. Mayor and committee members. Ed Benigno chief financial officer I'm joined by our chief information officer. He's also the director of Austin technology services. Kirk is going to do most of the talking today. Provide an update for you on efforts underway to optimize our technology spend. It's been one of the areas of fastest growth in our city's budget since I've been here for about 17 years now. I mean, it kind of makes sense, right? It's the technology age, so it's not too surprising that our technology spend has been growing. But given the kind of the harsh realities of the financial constraints we find ourselves under, the historic growth rate really isn't sustainable. So we needed to take a hard look at that spending and find ways that we might be able to operate more efficiently and effectively. Of course, there's been a lot of conversation subsequent to proposition Q failing conversation among city council members who recently [11:28:24 AM] approved an ordinance change to require efficiency audits. And there's still discussions at the community level about a potential ballot initiative related to efficiency audits. I'm really proud to say that we didn't wait for the city council or the community members to say, you know what? We need government to operate more efficiently. This is an effort that's been underway for nearly a year now to take a real hard, comprehensive look at our organizational structure, our management structure, our governance, our strategy implementation, contract negotiations, and also reviewing literally well in excess of 1000 applications that are in use across the city, seeking ways to find redundancies and opportunities to improve the efficiency and the delivery of of critical information technology services. So I just wanted to tee it up with that. There's a lot of initiatives going on beyond what is going to speak to today. She is going to focus primarily on the organizational design work that was led by Gartner consulting, as well as the application review analysis [11:29:24 AM] that's being led by a consulting firm named parcel parcel. But I'll turn it. >> Over to you. >> Thank you. >> Thank you. Good morning. Mayor. >> I don't think your microphone is on. Speaking of technology. >> Thank you. Good morning. Mayor, council members. Cara Calaycay, chief information officer and department director for Austin technology services. So today I'll share a brief update on our technology optimization initiatives, which include the centralization of technology staff into Austin technology services and the citywide application rationalization effort. These initiatives fall under the umbrella of the city manager's efficiency and optimization of city services. As cfo, Benigno mentioned, we began these efforts in June of 2025 with Gartner consulting. They're a technology research and [11:30:25 AM] consulting firm. We began with the organizational assessment on how we could increase the value of technology across the city. The goals were on reducing cost, strengthening governance, streamlining and modernizing our application portfolio, and improving overall operational effectiveness. Additionally, we wanted to have recommendations on a more efficient and effective technology operating model to address the demands of growing Austin. The scope of the engagement included an it staffing benchmark as well as a high level it spending benchmark, along with a request for an intentional organizational design to meet citywide technology goals. So the Gartner assessment showed that. Austin spends more than peer cities, and the initial [11:31:27 AM] estimate is 81% more, about $210 million a year. Only 30% of our it staff is centralized, compared to 81% in peer cities. And we have 98% more staff. I say this with a caveat. This was a high level spend benchmark, and we have a phase two that's almost completed. We'll be removing the operational technology cost from those numbers that represent some of the technology and our utilities and our airport. Those are normally outside of the general I.T. Cost for spend. So we're going to look at it in that way to make sure we have a good apples to apples comparison. I'll also say a finding from the assessment. The current model shows that we have duplicate functions, redundant systems, inconsistent standards, [11:32:28 AM] and our departments are maturing at a different level across the city in terms of their technology capabilities. Gartner's recommendation from the study was to align technology to align technology staff into Austin technology services. In doing that, we established shared services across the city, governance across the city. We centralize our core technology capabilities, and we have shared accountability and focus on a service first model for technology. This new model reduces the duplication of services that we see, reduces cost. Pardon me, and reduces cost throughout the the technology portfolio. Okay, I'd [11:33:33 AM] also like to talk briefly about the centralization of the technology staff into Austin technology services. So with city manager's support of the recommendation, we began the work on transitioning into one Austin technology services. So from December through March, there have been information gathering, meetings with staff across the city. We're conducting these information gathering meetings to learn more about the work that's being done in the technology, work being done across the different departments. At the same time, we've been holding stakeholder meetings with the department directors to understand their concerns and opportunities about this effort. In April, we'll have our team alignment recommendations on new structure for the [11:34:34 AM] organization, and we'll begin discussions with departments around those those recommendations we expect in may, we'll be sharing the changes with our staff and beginning that onboarding processes process into the Austin technology services organization. I also want to note that we're working on a separate process with a longer implementation timeline for operational technology positions across various enterprise departments to address the essential operations and regulatory requirements that we have in some of those departments. Phase two of this effort is the true transformation. Over the next 2 to 3 years, we'll continue to transform it operations across the city so that we're acting as one focused unit for the city, optimally resourced to centers of excellence that can produce [11:35:36 AM] true value in the technology initiatives that we take on for the city. Now, I want to speak to the citywide application rationalization. This was in response to a resolution from last year to review the city's technology spend and identify opportunities for efficiency through technology consolidation and reducing overlapping solutions. In July of 2025, the city began work with pass on a review of our city's application portfolio. They were selected for their data driven approach, their work with government organizations, and their methodology grounded in industry best practices for doing application rationalization. In August of last year, we kicked off the project with a focus on [11:36:37 AM] rationalizing the solution portfolio, reducing cost and reinvestment and innovation, elimination of the redundancy, better security for critical infrastructure, and creating a continuous process for rationalization. Post-project. There are six phases to this project. We're currently in phase five. Apologize. There we go. So so far we've baseline the portfolio. We have 184 unique applications across the city, with 2009 instances of those applications. For instance, in one department may have an installation of application and another department has set up another instance instead of using the primary. The consultants have identified 24 consolidation opportunities that have that [11:37:38 AM] represent consolidation of over 300 applications. So one consolidation opportunity would be related to multiple applications that we'd want to reduce into a common platform. They've completed initial analysis on cost benefit risk and security overlaps and gaps. We have a dashboard that's been created for tracking performance metrics. And we have recommendations on how to keep the process evergreen through continuous rationalization efforts. Still to come in phase five are cost savings analysis that are due later this month with project closeout in April of this year. And now here, it is important to say that the opportunities that have been identified, they've been identified, we [11:38:39 AM] want to further vet them, but the work of implementing the program is yet to begin. Having an aligned organization with focus on completing these recommendations will really help drive the effort. Over the next 2 to 3 years, we'll begin the rationalization process focused on our short term, mid-term, and long term wins, with the eye on bending the cost curve for it spending and strategic reinvestment in new technologies and security for the city. Great. Thank you. >> Thank you. Members. Questions? Yes, councilmember Fuentes. >> Thank you. Thank you for the presentation on the slide where you talked about the application rationalization. I mean, just knowing that the city that we have over 2000 [11:39:39 AM] total software applications across the departments and enterprises, you mentioned that you that staff has conducted a cost benefit and risk analysis. I'm curious how much in savings were identified if we were to do the 24 consolidation opportunities. >> They have identified that at a very high level, but haven't considered the training or the implications of moving people to those new, those new applications. So in phase six of the I'm sorry, phase five will get the true cost savings analysis. And so we would come back with that information when that is that is finalized. >> And that will be when do we end. >> This month. This month. >> Okay okay. My other questions are on the process of the consolidation that city [11:40:39 AM] staff has or that city management is undertaking on this. Can you share just you know, you've gone through an extensive stakeholder feedback phase. How has this proposed consolidation been received by departmental staff and from the workforce? >> It's a large change for our organization. And so we have some people who are very excited about the opportunity to work with others across the city and be able to be aligned. And teams that do various work. We have people who are excited about working in a larger organization where they have more defined career opportunities and career paths in technology, leadership, and as a peer technologist. On the other hand, we have people who are concerned about the change. They are very aligned to the mission of their departments, and it is something new. And so [11:41:41 AM] as people work through the process of change, we'll be having additional workshops and additional discussions about how we continue to focus on the new culture of Austin technology services. We want to make sure that people know that their work is important to our organization, to the city as a whole, and that they have not only the opportunity to focus on the department that they've been working with for however many number of years, but they'll also have the opportunity to more broadly understand how that interconnects with the work that we do as a city as a whole. But to your it, the the emotions are mixed on becoming one organization. >> Yeah. And you know, colleagues, I just want to draw your attention. We've received a letter from afscme, our employees union, just citing pretty significant concerns with the consolidation process. And so the feedback that you've been receiving from city staff, [11:42:42 AM] have they been incorporated or how are you? I mean, I know you're not going to be able to take all of it, but I mean, how have you all been able to take that feedback seriously and work it into this proposed consolidation? >> So we are looking at all the feedback. When people have questions. We have a dedicated sharepoint site where we're posting answers to their questions. And very honestly, if we don't have the answer, we'll know we're sharing that too. This is new for our organization. Moving into the centralized model. Different departments have different standards that they are using in their organization. So as we go through this transformation, we're very open to making sure we have a best practice for the city of Austin. So we have that opportunity to together co-create what that looks like for for our city. >> Last question on my end council recently adopted just last week the consultation [11:43:43 AM] agreement framework between the city and the union. I'm curious with the timeline you've laid out here, with this being implemented, the proposed merger consolidation by may, how does the consultation agreement work into this process? >> Sure, I might have to. >> Yeah, I mean that was just passed. And so that's not been decided yet. So but we certainly will be following up with what the direction of the resolution it was to meet with aacme and to talk through these issues with them. But as you mentioned, it was just passed. So this process has been in place for nearly a year. And so now we need to incorporate that direction from council into our process. >> So that meeting with aacme will be taking place between now. >> And I think it's going to need to be more than one. Yes. But yes. >> Thank you. >> Councilmember duchen. >> Thank you, mayor, and thank you both for this incredibly helpful update and the work you've been doing on this for the last year, plus. Earlier [11:44:46 AM] you you mentioned that you were going to be looking at doing more of an apples to apples comparison. I know that even in the Gartner report that we got recently, it outlined some of the some of the challenges that they had when looking at different kinds of departments and their sizes, and whether they were enterprise departments and so on. So can you speak to can you expand on how you're going to try and accommodate some of those concerns that some of those departments might have, where they might have proprietary technology, they might be in different spaces. They may not be exactly comparable to some of the other peer cities that we looked at because of the different nature of our cities. >> So the first thing I'll share about that is in talking with Gartner, when they created this study for us, they, they, they looked at different models. They took some of our enterprise departments. They, you know, they they tried to make sure that the peers were [11:45:48 AM] comparable in the in many ways to Austin, nothing is Austin. So we don't have anything that's going to be perfect. But they were very selective in making sure we had cities of comparable size with comparable budgets, with comparable functions for their municipalities. That being said, even in that analysis of removing particular components, the direction it's directionally correct, the percentages will change the the the dollar spend will change, but it does not change the. The direction of the study might reduce some percentages, but it's directionally correct. In this next phase. We've actually gone back to the departments and said, here's everything [11:46:49 AM] that we looked at based on what we received from the budget office. Can you go back and identify the components of operational technology? And we will take that into consideration in the phase two effort. That should finish here shortly. >> Okay. And I appreciate that. There was probably a lot of sensitivity and that a lot of that's outlined in great detail in the Gartner report in terms of comparing to four airports and one utility and so on. I just wanted to make sure that it sounds like you've got a plan for trying to to the best that we can compare the apples to apples, as you said earlier, and maybe you can just expand a little bit more in the event that like for some that is very sensitive, proprietary, the airport, the, you know, Austin energy, if we were to want to say keep security functions within a specific department, is that going to impact the directional correction, you know, directional notion that you just mentioned? Is it going to impact projected savings, or [11:47:50 AM] is that even on the table for how to approach those sort of, again, particularly departments that may be doing proprietary work or have specific needs that are outside of, say, fleet or hr or something like that. >> So those things that are domain, domain specific to those areas of, of our organization, those are the things where we believe there may still be opportunity for cost savings in shared contracts and bulk buying, but we understand that there might have to be dedicated resources to those those functions in those departments that, you know, it it important to their essential function. So that's part of the consideration. >> Okay. Last question is I know you identified fairly significant numbers, or rather the Gartner report did regarding $200 million, 81%. Do you have any sense at this [11:48:51 AM] stage, given that we're still, it sounds like, several years away from full implementation of what sort of savings we could be achieving in the near to mid-term Wright for the, say, fiscal year 27 or 28 budgets. >> I don't have that yet, but I feel like we will have a better number at the end of this month. >> Okay, great. Then we'll look forward to that. Thank you so much. >> Thank you councilmember. >> I've got some questions to follow up. Just on the but we can follow up offline. >> Yeah. >> Anything else. Okay. Thank you very much for this update. Thank you. You want to talk? >> We did want to mention that Susan, would you like to share? Thank you. I would love to. >> The question was asked will it be on the consultation committee? We do have it recommended for discussion on the consultation committee to make sure that we've got clarity, that we've got engagement and that we get questions answered. Okay. >> Thank you, members. That [11:49:53 AM] concludes the agenda that we're going to complete today for the audit and finance committee. So unless there's objection, the audit and finance committee and without objection, the audit and finance committee of the Austin city council is adjourned on March 4th, 2026 at 11:50 A.M. Thanks, everybody. Thanks for all the presentations. Good meeting.