At this time, we'll call to order the special City Council work session at Clearwater City Council for August 11, 2026, and we'll move to item 2.1 of the agenda, and I'll call on the City Manager to present. I'd like to call up Tiffany Macris, our HR Director. Good afternoon. Tiffany Macris, HR Director. Before we get into the numbers, I wanted to make a quick announcement. So HR took a slightly different approach with this year's staffing report and compared to last year's. Previous reports were based on calendar year. With the current year in the report that was presented, it was a combination of the actual and then a forecast. So what we did, because many of our benchmarks are captured in fiscal year, so for consistency, HR adapted and aligned this year's report to a fiscal year framework. This builds in a verification process against existing dashboards and metrics, and because the date and methodology changes, you may notice some of the figures are slightly different from past years, and all of the FY26 year-to-date data is shown as year-to-date and not annualized as a forecast. So today I'll focus on the major workforce indicators, vacancy, turnover, separations, reason for separations, internal advancement, and hiring, and then all of this should provide a broad overall staffing picture. Can I catch my breath here? Okay, so with that, we'll get right into it. So this first graph is going to show us a vacancy rate, and so one of the interesting things about the vacancy rate is it's really a point-in-time reference. This could change and fluctuate daily. So in going back and looking at it at an over-a-year standpoint, what we can see is that from FY23, we've got a relatively stable full-time baseline for our vacancies, fluctuating anywhere from 11.3 to 11.2. The part-time tells a little bit of a different story. That looks a lot more volatile, but what I would like to point out is that it's a matter of proportion. So we have 81 part-time permanent positions, which represent about 45.62 FTEs. So just the slightest fluctuation can cause the change. So this is the data as of August 1st. We had 247 total vacancies. We were actively recruiting for 173 and had 74 of them paused, and the pause is due to the soft hiring freeze that is in effect. So that brings us to our turnover rate. What I am really happy to report is that regardless of the dates changing from calendar to fiscal year, what we can see over the past two years and trending into this year is that we're maintaining a single-digit turnover rate, which is really phenomenal in comparison to years past. So although that 5.6 looks really spectacular, again, it is just a point in time through August. We do still have to finish out the rest of the fiscal year. But I would say that the direction that we're trending in is very encouraging. Resignations remain the largest category of our separations, but, again, what I would like to show is that the trend is that it is steadily improving over the last couple of fiscal years. We had a lot in FY22, 180, and that's just trending down every year. Again, we've got a really low 74, but another two months of the year to go. Getting into the resignation reasons for the past two years, So this is the one slide where we continued with the previous methodology of the reports that were brought before you. So pay has continued to decline as a cited reason for resignation. So it was 9% in 2024, 7% in 2025, and now we're showing 6% is the reason that it's being cited for an employee voluntarily leaving. So while that's declined, and it is a meaningful comparison, the dissatisfaction as a reason has increased each year. Something for HR to take a look at, these are things to be mindful of, really just tells a story. We can't draw a lot of conclusions from it. Other than compensation still matters, but employees are citing pay as the less frequent reason as why they're leaving. Growing and promoting our employees, we definitely strive to work for internal advancements and can look at the data to see that the last couple of years we've had significant increases. I think what is important to look at from the FY23 to 24 is we had a major comp and class study change that adjusted our job families and titles, and then in FY24 we really made an effort to make this robust job progression guide, which is a JPG guide where someone could move through their job families, a 1 to a 2, a 2 to a 3, et cetera. And so there's been a lot of effort and emphasis on providing an internal promotional framework. This graph represents the full-time and part-time permanent hires, and going back to what I was talking about in the vacancy rate with the part-timers, you can see the change here. There's just very few movements in the part-time permanent arena. We have a lot of variable positions in the temporary space, but as far as the part-time goes, you can see we've hired four permanent part-timers this year. But we can also see that the hiring has declined, which is another area that points to our stabilization of vacancies. So overall, I would say that our staffing is the overall staffing picture is one of greater stability than one in years past. We definitely still have some areas that need attention. And again, just to remind you, the goal of refining this report was not necessarily to produce cleaner numbers, but just to give a consistent baseline that we can use to identify trends and make better workforce decisions. And I'm happy to answer any questions. Okay. Any questions from Council? Thank you for a good report. Move to Agenda Item 2.2. Yes, I would like to call up Dan, our IT director. He's going to give Council an update on our AI and technology progress. Can we get the technology expert in here? Anybody here? A little pre-impanning goes a long way. Well, just having fun. Good afternoon, Mayor, Council Members, and City Manager. I was asked to just give a brief update of how we're using artificial intelligence within the organization now and how it's informing our path forward as we go into potentially leaner times. Just for clarity, I want to give a definition of what artificial intelligence is. We're going to use IBM's definition as an early pioneer. It's the use of software technology that enables computers or machines to simulate human learning, comprehension, problem solving, decision making, and creativity. If it's able to perform these functions with human input, it's referred to as generative, so prompting something to produce an output. If it can do these things autonomously, it's the Terminator or Sunny in iRobot. It's referred to as agentic, so it's its own conscious being. Currently, our use of AI really falls into three main categories. It's provided us a huge amount of benefit in cybersecurity and network administration, so user management and threat identification. The other area is customer service and engagement, so we have AI agents on the website. We're introducing call agents and utility customer service this year and also able to track issues with our C-Click fix, so we can keep an eye on those things. And then mostly used for employee knowledge and productivity enhancement. So this is our chat GPT engagement, and we have 130 employees currently using it, and we have some interesting results to share. Near-future projects will include additions to Tyler Munis so we can process AP and invoicing more efficiently, adding natural language query report capabilities in our asset management solution, as well as obviously one we're looking forward to, site plan review and Acela, the use of Acela's tool, or possibly the Blitz tool. That one is having very mixed results in terms of reliability, and with that particular audience, we're moving cautiously. We want to put a good product on the floor if we're going to introduce it. If we go to the next one, this is what we refer to as our ecosystem. So we have not just bought AI with the exception of chat and applied it broadly across the organization. All of these vendors have existed in our portfolio and have offered AI functionality within their products. This has been very important to us because these provide the best opportunity to create agency on the part of the products, meaning it can perform a task. So if we call utility customer service and I want to schedule a turn-on or a turn-off, the agent can actually go in and schedule it, give you a time of expectation, and create a service order for the employees. It has been well-received by most of the departments. Some of these applications we know are controversial, but we use them responsibly and we make sure that there is accountability and control for all the data that's collected and executed. The three main categories, this gives you a little bit more detail. We've had the most enthusiastic use in the intelligence and performance side of the house. Some of the Bloomberg projects are up there and listed. The in-house knowledge base, which we think can help assimilate people into the organization more quickly and give them familiarity with processes and procedures, as well as key knowledge sources within the organization to make them more productive. And the use of, obviously, the workflow enhancements. So there's a couple of areas where we're hoping to add that. The other thing I want to add in this is that prior to AI, what is required for data management and cybersecurity is a pretty massive undertaking. I don't know that we would have modern cybersecurity without AI. The volumes of data and the numbers of logs that need to be processed simultaneously are overwhelming, and it really wasn't reasonable to expect human beings to process that much information in quick order. Resident engagement, I'll point out Kayla at the top of that list. We're very optimistic. This may be an area where we have a narrow enough task that we can really gain productivity. The hope there is that we can reduce some of the burden on the existing call center such that we can drive more calls across the enterprise to that one source. And if we do that, we can add other agents and improve productivity that way and possibly save in real positions down the line, five or five. So I want to refer a little bit to the ChatGPT experience. So really, we have 130, as I mentioned, that are using ChatGPT. The vast majority of use falls into the four departments of information technology, public communications, a lot of image processing there, public utilities, and public works. Highly technical, very data-based operations in those two areas, and they've been able to use Chat quite a bit to both inform decisions and process larger complex data sets. But the five most common types of tasks that it's being given, really communication is over 50% of what our use is. So we're communicating hopefully more clearly, more quickly, more thoroughly in terms of what is communicated, especially if it's to third parties that we have to interact with. How-to guidance, if we're getting into new solution sets or evaluating alternative solution sets to what we currently use. And then we are using and coding on automation in IT and a couple other departments, and obviously data analysis and complex explanations. The conversation, so the graph at the bottom, actually refers to the topics of prompts that are entered into the solution. So those topics are mostly operational or infrastructure, IT or security rated. So we'll say, how do you write this policy best to protect the network? People and culture can be varied, public affairs, and, you know, some of it is a little bit of an advanced Google search if we want current events or other connections. So it has informed that, and we think adoption is good. I think a key thing to point out here is 90% of our token usage, so what we pay for to process, is used by 10% of our users. So roughly 12 to 13 people use 90% of our capacity. So if we extrapolate that, if I had 150 or 200 really active AI users, we would surpass a million dollars in token spend. So the question of gauging if we're getting productive value and gains out of expansion and rapid use of AI, is it going to offset costs? I'm not certain at this stage. Costs are still not cheap. The other side of the coin of this is obviously our resident engagement or our customer engagement, and the public has an opinion, obviously, as we see every day in the news. We polled people at our recent community workshop, and 85% expressed tolerance for AI, if you will, or an acceptance of AI is probably more specific, but they want the ability to reach a human. Many experiences were shared with, hey, sometimes I get in this do loop, or it's just they don't know how to prompt it. They're not asking the question the right way, and they get frustrated with the return or the activation. So they are open to us using it, and they expect it. It's inevitable, but they want that fallback to be able to dial a human to get what they need in the short term. There are those who want the efficiencies, but I think we can solve both these problems going forward, and we think the call agent will give us the best litmus test. So quick observations. We've seen success and productivity gains in a number of areas, primarily individual employee productivity. The consumption of credits needs close monitoring and can be expanded, but needs to be expanded with expectations. Growth in our user adoption is encouraging. It's difficult to quantify specific gains in value, meaning I can't tell you that we can replace a person or a specific role based on the addition of AI. We think we're pushing more product across the line, and we're pushing higher quality product across the line. And we need to continue training in the organization to educate people on the best prompts we can use, which model should be used because that's a variable in our token consumption, and then identifying the optimal tasks that we can give to AI with confidence to improve our productivity. The issue of how things are going to move forward is a lot more complicated, and it's a global question involving data centers, massive amounts of financial investment, and ultimately will it be offered to us in a form that we can afford and leverage for our benefit as a community and our service offering. So it still has many hurdles, and some of these improvements may be addressed in the near years. Some of them may take decades. We don't know. Due to current cost trends, AI may be easier to justify because we can expand services to be 24-7, as opposed to saying it's just better than the 8-to-5 coverage we currently have. Growth in general knowledge models and agency capabilities of these models to get work accomplished will be needed to fully replace humans in any role within an organization. And for most of our employees, robotics would need to be a part of that as well, which is a very complicated solution. The established solution providers provide us the best possible short-term gain in productivity. As they understand our environment, they're able to add AI to the specific tasks that they know we repeat on a regular basis and provide us with quality outputs because we've vetted the data and they know the product we're looking for. So we expect to see near-term gains with our current partners, but we also need to be rigorous to say if a partner is not adding this functionality and is not growing with the advancement of this technology, we may have to separate. We're considering moving sunny for that reason. The need to train and improve that product is important. We don't feel it's giving the accuracy and consistency of results that's satisfying the public, so we're going to look at some other solutions there and probably replace that within the near term, meaning the next 6 to 12 months. And that's it in quick summary. I'm happy to answer any questions if you have any. Questions for Kessel? Kessel, Kessel, R. O'Brien. Okay, so, yeah, ChatGPT, do you have a token budget for your department, or do you? They refer to it as credit. So we pay $65,000 for a total of 150 licenses, and we get a consumable budget of about 38,000 credits monthly. Is that based on time? Open AI was ill-prepared to dive into the mass consumer market. It's what they offered. It's kind of a tiered, so if we were to add more, we'd get more users, we'd get more token allowances, probably a higher per. But we wanted to do it as a pilot to see what the net productivity was. So maybe it could be negotiated. I, you know, I refer to it in the slides. Some of these companies are carrying enormous debt obligations, and I don't know that they're prepared or can just blow away their fee charges because they've got to cover those obligations. Yeah, I understand. And I just wondered how it was on a, you know, a personal level. They don't do the token thing. You just pay a monthly fee. Yeah. And then, but a business, you know, you've got to know that they're using it a lot more. So I guess that's how it's divvied up. Yeah. It's interesting. And just so you know, we also track how many different AI sites the enterprise goes to. There are another 80 sites outside of chat and outside of our environment that people use, and we have another 350 employees. Now, what we can't tell you is all of that engagement work-related. There are AI tools to plan your vacation, to pick your hotel stays, to evaluate all kinds of things unrelated to work, put together a montage of wedding experiences. But a lot of them we know are work-related. So we think we're even getting more utility from beyond just our chat experience. Well, thanks for explaining that to me. Yep. Others? I have a couple things. I think you make a really good point that if you're not careful, it can actually cost you more money than it saves. You know, it just generates more work if you're not being careful if you don't manage it correctly. But, and I realize you don't have a crystal ball. I don't think you brought one with you today. But you have been in this area for a long time and watching it. Can you just tell us how it feels like to me, the whole area, it seems like there's more and more vendors, you know, wanting to come present to us and get us involved. How fast is the industry evolving and the applications to local government evolving? Have you seen it change a lot here recently in the last year or two? I would say a lot recently in terms of its introduction into our existing products. But AI, Siri was the first AI agent introduced in 2011. That's 15 years ago. So, I mean, this has been a growing technology in terms of what it can do. The fact that it can do agency, the fact that it's generative, that can produce a unique product or an outcome without you having to tell it exactly what to do is a big deal. And I think the future will depend on the deep integration into our system such that it can provide more agency. It can get a task done without somebody having to hit a keyboard. It does other things very, very well. The video side has been huge, and I know it's highly controversial, but it's also provided amazing results to the benefit of a lot of people. And it gives us an ability to do rapid assessment or need, monitoring of infrastructure, quality of service, quality of performance. And, look, all technologies can do wonderful things. TV was going to change the world, and, you know, we sell products to people with it. I mean, whether or not the technology achieves a utopian goal is a conversation. I don't know if you read Mark Zuckerberg's manifesto that was released yesterday. He takes a very different view of the future. He's trying to be very optimistic. And once AI viewed as an enabling tool for everybody in the world to make their lives better and not a Big Brother tool or a tool that will remove purpose from all our lives, which I think is fundamentally important. So I think it will continue to move. I think the obstacles may be as much political or financial as they are technological. I think the technology is advancing pretty steadily. One of the other things you shared, which I heard, was that it may give us the ability to serve our citizens better by offering 24-7 answers to questions they have. Maybe they eventually do need to speak to a person to get an answer or find out information, but they wouldn't have to wait until Monday morning at 8 o'clock, whenever that office was open, for whatever our department was. Unless they could at least get some preliminary information through AI 24-7. Absolutely. And that's one of the features that Kayla will provide right out of the box. We will be able to keep it on all weekends and the evenings, and you'll be able to call and at least get general information. Or we can at least create a callback list so you get called first thing the next day, business day. Anybody else here? Well, I grew up and I'm an old-timer, so I grew up watching the Jetsons with flying cars. And evidently the governor yesterday said we're close to having flying cars here in Florida. So we'll appreciate you staying on top of this and keeping us on the forefront, because as you started with, you know, the goal is to serve our citizens better through AI. And so we just want to make sure we're managing that appropriately. And it sounds like you're very much on top of it. Appreciate your report. Thank you. Appreciate it. Okay. That moved to item 2.3. Now, if Kayleen Castell, our budget director, will come up. She will go over the proposed 26-27 budget. I know that you've already seen this presentation. We do have some additional more in-depth information that we will go over, and then we will go into the contingency plan at the conclusion of this. Good afternoon, Mayor and Council. Kayleen Castell, budget director. We presented the proposed budget to you at the council meeting in July. Now that you've had time to review, the purpose of this meeting is really just to give you an opportunity to ask questions with all of the departments represented, and so the majority of the time today is for you to discuss. If you have any questions on the presentation from July, I do have it available. We can pull it back up for your reference. But just as a quick refresher, I have a few slides to go through. This slide shows the total fiscal year 26-27 proposed budget by fund type. At our meeting in July, you approved the tentative millage rate at a reduction to the rollback rate of 5.8773 mills. So both the general fund and capital fund totals reflect changes to accommodate that reduction, and I'll explain those on the next slide. These totals represent the expenditure budget for all city operating funds, our special revenue funds, and our capital improvement funds, and that totals $800,012,476. And this, in total, is a 5% increase in comparison to the 25-26 amended total city budget. As mentioned, the changes to the general fund and the capital project fund, they'll be included in the final figures that we'll bring to you in September. In the general fund, we're reducing ad valorem revenue by $102,120. To offset that, the transfer of TIF to the both CRAs are reduced in total by $2,120, and that's based on the millage reduction and also their final valuations that we had received. And transfers to the capital fund from the police department are reduced by $100,000. And for the capital fund, this represents the elimination of the police district one boat dock improvement project from the capital plan. This dock damage is actually storm-related, and work is currently underway to restore it. So we are going to account for that expense in our Helene Storm project, seeking FEMA reimbursement. Ultimately, what is not reimbursed will be accounted for when we do that true-up eventually when all projects are completed. At the work session in July, we discussed the net increase of 3% to the general fund. And this slide represents the department-identified reductions and efficiencies where feasible to help absorb cost increases and minimize the impact to the overall budget. So as a request, I'm just going to walk you through some of the changes where we made reductions to try to offset increases. Expenditure reductions totaled $955,000, reduced to various department operating costs. This includes savings in the audit department based on projected spending, reductions to outside counsel costs in the attorney's office versus the current year's amended total, which was increased. So we're putting that back down to, like, the normal annual budget estimate. We've eliminated the grant funding in the council's budget. We're eliminating the budget for the supervisor of elections costs in the city clerks. There's no off-cycle elections planned right now for next year, so that came out. We're reducing various operating costs in the fire department based on projected spending. We've eliminated the warranty contract for library equipment. We've reduced some costs in public communications expenditures. This is based on their projected spending for this year. And also reductions made in IT had a very positive impact citywide and across the general fund to recognize savings there in our internal charges. Additionally, we've eliminated our annual support for Ruth Eckert Hall. They've been notified of this change. And our capital transfers are reduced by $6.4 million in comparison to the current year. Large increases that affected the proposed budget include increases to salary costs. This includes all of our bargaining agreements, general wage increases for non-represented staff, and also FTE increases in the fire department and public works this year. Our benefit increases related to health insurance costs and pension contributions have gone up. The cost for property and liability insurance has increased in comparison to the prior year. And also just typical contract obligations for the different contractors that we use have increased, and also utility costs, our increases are recognized. And lastly, this was discussed with you in one-on-one meetings with the city manager. To balance the budget, and also in light of pending legislation, we've eliminated the general fund contribution of $12 million to the Eddie Seymour renovation project. The proposed budget includes a total of 1,904.8 FTEs, full-time equivalent positions, I'm sorry. That is FTEs. You'll hear us refer to that a lot. That's the plan for fiscal year 27. It is a net increase of nine across all departments. In this graph, the sand-colored portion represents general fund FTEs budgeted at 1,172.4 positions, which is an increase of 11 from the current year. In comparison, the green portion represents every other operating fund. The total FTEs for other funds are 732.4, and that's a decrease of two from the current year's amended budget. In the general fund, nine new fire medics were added to support the fire department, which provides staffing coverage to reduce, I'm sorry, in response to the reduced work week hours that was approved in the collective bargaining agreement. And in public works, a business systems analyst has been added to support the implementation and maintenance of the new asset management system, and also an additional position to support the city's growing geographic information system needs has been transferred from information technology. The decrease of two FTEs and other funds represents changes in information technology, one position, as mentioned, being transferred to public works, and they've eliminated a vacant network analyst position. The purpose of this slide is to show a quick history of FTE changes. The city's position count was at its highest point in 2007. We refer to that as our peak year. Over the five subsequent years, as we responded to the Great Recession, 278 positions were eliminated, 263 of those were in the general fund, and a total of 15 in all other funds, leaving 2012 our lowest FTE count. In the past 15 years, our position count has grown. As we've added back major park renovations, we've reopened rec centers, responded to growth on the beach, and enhanced service levels and customer service areas across various departments. The fiscal year 27 proposed general fund FTE count of 1,172.4 positions represents an increase of 154 since 2012, which is still 109 positions lower than that peak year in 2007. All other funds have increased by 74.6 positions, which is 59.6 greater than 2007. And just a reminder of all the meetings that surround the budget process for this year. So we presented the preliminary budget to you at the August 1st meeting. We posted it online on July 1st and went through that full presentation, as I mentioned. We also held our first community engagement workshop on August 1st, and I have a few slides to kind of walk you through all the successes there. This is our special work session, again, for you to discuss everything, any questions that you have with the staff present. And then our two public hearings are both held as special meetings in September, the first at 6 p.m. on September 15th, and the second, which will be the final public hearing to adopt the budget, is scheduled for 6 p.m. on September 21st. So I just want to kind of report back to you a little bit about our community engagement workshop that we held on Saturday, August 1st. It was our Dollars to Donuts event, an inaugural event for us. Unlike traditional budget meetings, this event combined educational displays representing each department. We had interactive activities and resident engagement opportunities to create a welcoming environment where participants could learn about city services and then provide feedback. This was a great event with around 200 residents in attendance, and there was a full report that was attached to this agenda item that offers a lot more details. So another quick shout-out and thank you to our sponsors. Glazed Donuts provide coffee for our event, and Rockstar Donuts provided donuts to us. So we did hear one resident say that she came really just for the free donut. Not expecting it to be such a great event. She said that it was wonderful, and she had a really great time talking and learning from all the departments. So, you know, we knew food would get them there. So each of our departments hosted an informational booth with budget and operational statistics. Our directors and various staff were present and available to meet with our residents and answer questions. The department booths also included feedback boards where our residents responded to questions with sticker voting. We used donut stickers, of course. We had to keep with that theme, and Dan in his presentation reported back on the turnout of his vote. And then after learning about our departments, kind of, you know, walking through the circle of departments, our residents participated in an event that was building a city's budget. So they were asked to prioritize. They were given dollars, asked to prioritize across approximately 75% of our city services. And this chart represents the dollars collected in each of those categories. We also had a wild card box where they could provide a program or initiative that they didn't feel was presented in the other boxes. We estimate that 115 people participated in this budget-building exercise. And the comment we heard most at that booth was how difficult it was to decide, so kind of putting themselves in your shoes, really. And so these results really show that, with most of the categories having very close funding amounts, as you see on this. And after that, we had a community feedback wall. So this wall displayed how resident input has led to meaningful changes in the past. We showed examples of what was asked for and what had been delivered in response, which left the question to residents present, what should we do next? And you can see the sticky notes that are full of comments posted by our residents. And again, there's a full report that provides some of the detail of what was written on the wild card dollars and also what was provided on the feedback wall. And this, again, it was just a really great event for both city staff and residents who attended. We heard a lot of positive feedback, comments about the casual, interactive nature, really gave them an opportunity to ask questions and learn about our services. Residents, like I mentioned, they were expecting a boring presentation. They didn't expect it to be so interactive. So they seemed to appreciate that. And we also had a lot of residents that requested that we do this every year. So bagels and budgets. Donuts. We got to stick with donuts. So, yeah, so the next subject that we have. Before we go on to the contingency budget, Mayor and Council, do you want to have, do you have any questions you want to talk about for the proposed budget, or do you want us to go through this and we'll come back to that? Yeah. Council Member Tashida? The memo that you sent, what is the appropriate time to address that memo? That's what we're getting ready to go into next. All right. So questions on the current budget that's proposed? In common? I would like to say on the dollars to donuts thing, it, you know, as you explained, is very valuable for understanding, you know, how folks want us to spend our city dollars. But I heard several folks, a couple who had been through the Citizens Academy, said that it was like a one-hour Citizens Academy. It was a great orientation to all the different things that the city does that was very educational for them, aside from the budgeting process, just to see what departments and meet with the department heads at each table. So there was a great value in that as well. I appreciate the staff providing that additional information to the community just to help them understand the breadth of things that the city does. Okay? All right. So now for the next part. So, Council, I really appreciate. We've had some really great one-on-one conversations as it relates to coming up with a plan specific to should the referendum pass. And I know that you all were getting inquiries from residents and business owners and our community, as were we. And it was important to our team to be able to communicate in a legal way, in an educational way, to say this is what it would look like for the city of Clearwater should the referendum pass. And so I want to thank Council for giving us this opportunity to go through that. A couple things that I want to start off with to just kind of affect finding mission first to start off with, where we're getting these numbers from. So should the amendment pass? We are looking at $12 million in reduction in revenue in the first year and an additional almost $8 million in the second year. Those numbers were provided by Pinellas County, and they were provided throughout the county. There have been other numbers published by other reliable sources that go up as high as $15 million in the first year and $10 million in the second year. We did not use that. We took a more conservative approach and are just using the numbers that Pinellas County has published for all of Pinellas County. Other things that we do not have included, but we know should the referendum pass will have an impact on reducing additional revenues, is on the fire tax. And so we've got those numbers up on the screen. That would be an additional $750,000 in the first year, an additional $331,000 in the second year. On EMS tax, it's an additional $2 million in the first year, an additional $1.1 million in the second year. And then library services would be an additional reduction of $253,000 and an additional reduction of $151,000. So we got those numbers off of going through the actual county EMS site and the county library site as well to determine what those are. Those are estimates. They're not in any of the figures that we are discussing today, but just want to make sure everybody understands the breadth of what it is that we are communicating and that we are taking the conservative approach and actually coming up with the minimum amount that is proposed to be impactful. So we did send out the memo that outlines everything in great detail, more so than what we're going to go through today, because I don't want to read that back to you. You've had that for a week or so. Kayleen will now go over a little bit more of it. I do want to thank the team. This was not an easy exercise, and not because we're not good at reducing budgets. I think that we are great at reducing budgets, but this team has an incredible amount of pride in what it is that they do. And when you're talking about coming up with ways to reduce service levels, that's just not something that is ingrained in them, and that was a challenge. So I want to thank all the team members that are here that put together this plan. I'm incredibly proud of the plan and the work that was done into it. We do know that going forward, starting January 1, there is a required budget reduction exercise. And so regardless of should the referendum pass or not, we have the framework built where we can conduct this exercise going forward. So thank you to the team. That I'll turn it over to Kayleen. So as mentioned, the memo you provided last year outlined a contingency plan. And, you know, should our ad valorem revenues decrease at the projected amounts discussed. So which combined, again, over two years is estimated at over $20 million. So on this table, this aligns with that memo. So on this table, I'm going to add together for you the operating costs and service level reductions, as well as personnel and support reductions. So combined, that's in total over the two years, $17.5 million that we are proposing to reduce in this category. This represents savings from efficiency gains, department reorganization, completed initiatives, as well as decreases and elimination of existing services and program offerings. So by department, I'm sorry, we'll stay here for a little bit. By department, for parks and recreation, this includes reductions to all recreation center hours, reduced recreation and athletic programming, reduced frequency of landscape maintenance and irrigation at city parks and fields, reduced support for special events, elimination of public art funding on capital projects, transition of McMullen tennis to a third-party operator, reductions to the frequency of parks and landscape maintenance in the downtown core and beach zones, closure of the beach recreation center to be event rental only, and closure of an additional rec center to be determined later. For the library, this includes permanent closure of the beach branch library, reductions to library materials, both physical and digital materials, reduced operating hours at the main library, reduced reference staff at main, reduced programming hours and offerings to our makerspaces, the heritage studio and youth programming at main, and eventually a closure of an additional branch that we'll determine later. For the police department, this includes reductions for technology support costs, eliminating vacant positions, which include nine sworn and a grants manager, further elimination of civilian staff, which reduced the telephone reporting unit, police aides, facility aides at Coachman Park, and administrative and investigative staff. These position reductions would transfer administrative duties back to sworn personnel and also could reduce the ability to staff the department in a proactive capacity. For the public works department, this includes reductions to palm pruning and maintenance contracts, reductions to staff which support right-of-way maintenance, engineering supervision and inspection, and environmental and resiliency programming. For the fire department, this includes reductions to logistics and administrative staff, holding a vacant fire inspector, reductions to budgeted overtime, and to accommodate this, the plan would be to reduce to minimum staffing levels on select apparatus. For planning and development, this includes the elimination of funding for private property abatements on noncompliant code cases, the elimination of positions which support code compliance, walk-in customer service, and long-range planning. And finally, in this category, elimination of positions in administrative departments, which include the city manager's office, the city clerk's office, finance, economic development, human resources, and public communications. This also includes funding to support public arts grants and neighborhood grant funding. Capital project reductions total $862,016. This represents reductions to annually funded projects, pointing out annually funded because we have to make it a consistent savings over the course of the following years. So this represents a reduction of $45,000 to library projects that fund furniture and fixture replacements and also our technology upgrades and replacement. A reduction of $39,216 annually to fire department projects. These fund equipment replacement and also maintenance of the training tower. A reduction of $32,000 annually to the police department equipment replacement fund. An annual reduction of $800 to the sustainability and reinvestment fund program. Elimination of future funding in the Stevenson's Creek Park project, which will cancel planned site improvements at that part. And elimination of future general fund contributions to the East Clearwater Resiliency Project. Reductions proposed to third-party organizations, which may require negotiating new contract agreements, a total of $115,000. These reductions include eliminating the annual funding to the Clearwater Historical Society. Elimination of annual building and maintenance support costs for the Wood Valley and Kings Highway Recreation Facilities. And elimination of the annual agreement with keeping Pinellas beautiful. And finally, increases to various fees and revenues are also proposed in this memo. And this is an estimated revenue increase of $1.6 million. This includes increasing budgeted revenues to some new projections in these specific fire reimbursement and inspection fees. So that's just kind of a true up to where we're budgeting to what we anticipate them to be in the future. Passing back the cost of credit card processing fees on planning and development transactions to the customer. Renegotiating the venue operating agreement to increase ticket revenue sharing at the Sound. Creating new parks-related user fees for co-sponsor groups. New rental fees for nonprofit and partner agencies. New ticket fees for parks and recreation-sponsored events. Increasing parks-related user fees and rates for Coachman Park and other facility rental rates. Increase rates on the annual rec cards and plus passes. Increases to swim lessons and also ball field rental prices. Elimination of summer camp discounts for prepayment. Increasing the price of retail items sold at the Pier 60 Bait House. Then increase to the turnstile fee for access to the fishing pier at Pier 60. So we estimate that all of these combined would provide a budgetary impact of just over $20 million. Which again is that amount that we're looking at that is the projected at the lorem decrease. And then just finally, this is a draft view of a dashboard that our team is working on. Which will eventually list a lot of the proposed reductions that I've discussed with you today. Kind of by department or high category. So for the communication piece of, you know, what's at stake and what we think would happen if we were to have reduced revenues to our city's budget. If I may. So that dashboard, what we would plan on doing is based on the communication and the direction that we get from here. We will load up then the specific items that we discussed. So that the public, our residents, and stakeholders can look and see what the impact would be. Also, a couple things that I wanted to just point out when we came up with this plan, because that's all this is, is a planning document looking for some, you know, public discussion from council as it relates to if we're heading in the right direction or not, should the referendum pass. We used our strategic plan and the conversations that we've had from our strategic plan along with the information that we collected from the dollars to donuts. And then individually also in our one-on-ones, for example, one of the things that was important to council is that we not impact public safety by any of the current filled positions. And so those are the parameters that we use to come up with this plan. So with that, happy to answer questions and get direction. Okay. We'll go first. That's what we want to share. So first of all, as a city manager can attest, this gives me hives because it's so easy to just dismiss this as just, you know, numbers on a graph or on a piece of paper, but it actually affects not only our staff but our residents. So every decision we make impacts humans. So that makes it very difficult, and therefore I just want to formally acknowledge and let everyone know that I understand how difficult this process was for everyone involved. With that being said, I have a question and a couple of comments, and it's not to critique but just rather to add my voice to or my input to this discussion as well as to clarify some aspects that I think would be a good preemptive thing to do because I could just see some of the questions that are going to be coming at us. So first, one of the things that I wanted to, I guess, contribute is I was hoping that we can take another look at eliminating the full $25,000 for historical society. We have designated them as the Clearwater's official historical society, and we continue to rely on them. Just recently with our North Ward event, they assisted the city by providing historical photographs, memorabilia, and resources that helped us all with that event. So before we eliminate the whole amount, I was hoping we could look at other alternatives, maybe spread the reductions across other grants versus just eliminating the whole lump sum, just adding that. Also, I do want to point out that the Clearwater Society has been really, I think, very active in ways that have saved the city already. And the Plum House, I will be making a presentation in the next few weeks, that is a great example of how the volunteers from that society have had a direct impact, at least financially for the city, in terms of what they can give to us. So that's one thing I would like to add to this discussion. The other one is sort of like a preemptive thing, because I could just see how people are going to already have questions for it. And that is about the eliminating the compliance inspector, that one full-time equivalent. I know that it would affect responsiveness to resident requests and short-term rental regulations, but I could just imagine how people are going to have questions regarding that we already know that we outsource some of those planning positions, but I know that there is a difference. And so if we can have a clarification on that. In other words, we're not going to get rid of one FTE and then outsource it. And if we are, we should have – I know that there are different functions. I just want an opportunity to clarify that on record. Good afternoon, Lauren Matske, Planning and Development. So the role that I propose to be included for our budget reduction exercise is specifically for a code compliance inspector. Many of you are aware we have what we call generally zone inspectors. So we have nine zones, but we have ten of that type of inspector. And so this particular inspector is more of a floater, fills in when people are on vacation, helps with training because the person in the role – there's no one in the role right now. But historically, that role has been filled with someone who is able to take on special projects and such, and that's why they also handle the short-term rental pieces. So it would not be something that we would replace through a different platform. We do use an IT platform for support for our short-term rental specifically, but we would need to find ways to distribute some of that across the other inspectors. So there would still be that kind of ripple effect because the work still gets done, and it would just be in different ways. And this is not one of those positions that we contract out. Correct. It's completely different. This is a city employee. Does that answer? Yes. Okay. Thank you. Sorry. Just to clarify, there are roles that we do outsource within the city, but that's our building inspectors. It's more like permitting. Yes, that's the permitting side, and we try to fill those positions. They're not all filled, which is why we'd come to the council previously for an increase to our purchase order most recently. Those we do have contracts with to help supplement staff. Ideally, we would have city employees, but we would still always have some contractors. So this one on the code inspector side, it's the code compliance team, and we would just go without. Thank you. Thank you. That's what I wanted to hear. Okay. Thank you. And, Council Member Tichetta, as it relates to the grant program, so we've actually proposed eliminating all of the grants. So outside of the ones that are, you know, when we get through, like, SHIP and stuff like that in economic development and housing, but outside of that, the grant program across the board, all of those entities have been proposed to be eliminated. So I know you were mentioning spreading it around, that there isn't a program to spread it around, and now we can do it differently. So, you know, I just wanted to clarify that the grants programs have all been eliminated outside of, like, not in CRA. You know what I mean? So I'm talking specific to the general fund. So can we have a list of all of them? I was only responding to the memo, and it was only listed as the Clearwater Historical Society. So if I can have a list of who else would be affected by that across the board elimination. So she mentioned Keep Pinellas Beautiful, and then Ruth Eckerd, and then the grants program that's in the council budget. This is the one that we talked about in the one-on-ones. That's actually proposed to be eliminated in the fiscal year 26-27 budget, not included in this. But we'll send that information back out. So it would be a total of, do we know? It's probably close to a million dollars. The homeless funding, the funding for the homeless initiatives would remain. That's the largest kind of a grant, really, that we do, but everything else has been eliminated. I do have that list, not with me, but I put it together just recently. There's, I think, the only one that's not necessarily addressed, and because it would probably need negotiation, again, we have a multi-year contract. I do think it ends this year, is the Arts Alliance, but that's also proposed eventually. But we have that list. We'll get that to you. Thank you. And I'd like to see that list, too. I guess I go. I was getting confused with the different amounts, $60,000 here, you know. But I'd like further clarification if I had missed it prior. No problem. And you're asking some really good questions. And I hope we continue to ask more questions about this. But we're not approving anything today. In fact, if the referendum passes, which is really anybody's guess, because who knows what 8 million people throughout the state of Florida will do or not do on Election Day. But only three of us will be up here if it does pass that are here today. So that's a majority, I get it, but still, you know, some of these things on what we actually do or don't do, if it passes, it'll be a new council considering all this. That's why it's important I say it now, before I go. Sure. Okay. You have other questions? That's a member. Nope. Okay. That's it. Vice Mayor, have you like? I'll just kind of thank you first, allude to what you just said. You know, I appreciate everybody in this room taking the time to go through your budget and prepare for the potential worst. We do not know what's going to be happening come November. And being able to look and have the forward thinking is important. And I appreciate everybody's dedication to trying to get us there. But, listen, the sky is not falling yet. It's just prepare for the worst and then hope for the best. So we'll see what happens in November. I do greatly appreciate everybody in this room's work. But for our entire team, not just the people sitting in here, you know, let's just keep doing a great job in trying to lead these people in this city to the great place that it already is. So let's just hunker down and get through November. Council Member Menino. Want to go? Go ahead. Thank you. You're fine. Thank you, Mayor. I want to echo some of the same things that have been said. I want to recognize the discomfort this exercise has caused for so many individually as well as departments. That $12 to $15 million in year one, upwards of $20 to $23 million in two years. It's impossible to manage those type of reductions and not directly affect the quality of life or the level of service that we proudly provide to our residents at Clearwater. And there's no way around that. This exercise obviously wasn't easy. I appreciate how we tried to spread the peanut butter as much as we could across the whole thing and not just beat up one department or others. That was extremely challenging. Again, I think we all recognize, as the Councilwoman said, is we do see numbers on a spreadsheet. But I know for each and every one of us up here, we don't just see dollar figures. We see lives and personnel and little ones and mouths and homes that that affects within our departments and our team. And we take that extremely seriously and take that to heart. I appreciate, I think, the dashboard is going to be an awesome tool and resource going forward to truly help educate our residents and let them see it and let them see directly the choices in front of them in November. And again, like the mayor said, we don't, unfortunately, do not have that crystal ball. We can't shake that eight ball and the answer comes up on it to give us that direction. But having the ability to let the residents identify and say it's going to be effective and you have that option in our city and across the state to decide what you want your city to look like and what level of services you want and the quality of life you want to live and to be able to directly point people in our residents to a dashboard is a big help and let them see it themselves and play with the tools. We'll see what direction it goes. I know we all have our hopes and our thoughts towards it. It doesn't go without recognizing the affordability challenges in all of our communities across our country. It's the number one issue at kitchen tables across our entire landscape, not just in our city. So we recognize those challenges. These exercises help us find ways where we as a service provider can tighten that belt and find ways to continue to run efficiently and productively while being respective to those tax dollars and hard-earned tax dollars of our citizens. So I recognize the exercise was uncomfortable. Appreciate all the work and diligence that went into it. Hopefully the sky isn't falling. I appreciate the conservative approach because if we did take the higher-end approach, we definitely would have been criticized. Why are we taking such a high-end route? So we did take the low-end, but there is no doubt this amendment passes. It drastically affects your level of services and quality of life for our residents, and the dashboard definitely explains that. So appreciate everybody's work. Councilman Albrighton. So I just want to say to the public, you know, we didn't know this was coming this year, but we've had practice the last couple of years of tightening the belt, which I want to thank the city manager for really starting this a couple of years ago, you know, seeing what she could do to tighten the belt and see what we could save. And so this particular exercise, although it is uncomfortable, I mean, all the different city departments have had practice in doing this. And, yes, it is going to be – there are going to be some services that have to be cut back. But I can tell you this, Clearwater is much, much better than a lot of municipalities around us. Our situation, the $12 million, is manageable. There are some municipalities that won't come out of this. They don't have the hotels, the commercial properties, the second homes, all that that we have in Clearwater that is going to carry us through. A lot of these municipalities that don't have any of that, they're the ones that are really going to be hurting. So I do want to thank everybody, all the departments, for going through this exercise. There's nothing wrong with being proactive about this. And so we have all our ducks in a row in case things – in case the referendum passes. But, you know, we're going to just – we're going to still have great service in Clearwater, and we just have some of the things that we – the ancillary services that we support are going to have to be cut back. And then we'll see, you know, where this goes. But, again, all you all that's sitting there representing your different departments, you know, thank you for this. I'll go last, I guess, just to later on what I – I just had lunch with a legislative leader this morning. And I think that, you know, if it doesn't pass, I think there's going to be the next legislative session. They're going to look for other ways to help authority and save money. So I don't know that it would necessarily be the end of tax reform. And I know there's some talk of appointing a committee to study our tax structure in Florida and how we fund local government in general. But, again, as I said earlier, you know, I think roughly 8 million people voted in the last gubernatorial election. So we've got about 8 to 9 million folks who probably vote this time. And, you know, we've all been throughout the state of Florida. It's not all Clearwater. It's rural counties. It's folks who – some folks are really having a hard time across the area. So I'm out of state, and I'm sensitive to that. And I'm also sensitive to the messaging I heard one of the Niles County commissioners say the other day, that regardless of whether it passes or not, the message is clear. Folks around the state of Florida, including Clearwater, are having to tighten their belts. Gas prices and property insurance and everything is going up. They're having to tighten their – they're having to eat out less. I've heard from many restauranteurs of the higher end here in Clearwater. They're not seeing the same volume of business that they did a year ago. Folks are cutting back with their family budgets. So it's reasonable for us to look at tightening our belts as well. And I think we owe that to our taxpayers who – I've encouraged everyone, you know, this – to read through. This is very uncomfortable for me to read through and see where we might have to reduce staff. Those are families, and we care about the families, all the families that work for us. But, you know, we've just got to also be sensitive and appreciative to those families that contribute every year and have for the last 10 years, as we see in here, their money, their family's money to help make this city successful as it is today. So I'm sensitive to that as well. And I do appreciate what the staff did on this because I've read through it and highlighted a bunch, which I don't know if we want to get into too deep into today because, as I said, you know, three of the five of us will be here when we actually have to implement it all. But I did want to point out a few things that I saw overview. One is – it was slide – one of the slides, slide 12 in the budget presentation that was here. You don't have to pull it up. But it's on the – what we got out of the dollars to donuts survey, surveying folks. I'm not sure 200 people that were there, you know, if they were – you know. I'm sure I got an A in statistics in college. I think my professor has long since passed, so I think I got the highest grade he's ever given, the score he's ever given in statistics. But I don't know if this is a sample, you know, that would represent how folks feel. But I can tell you from serving, going door to door, this is kind of how I hear from residents what their priorities are. Probably a little bit more towards the top two here, emergency response and safe roads. are their highest priority. They do appreciate parks and rec. They appreciate libraries, the other things we do. But those two things are their highest priority, and they do not want to see us cut back in any area. So if we got to the point where we had to consider these, I would want to know from police, fire, you know, that kind of cuts your – you know, I saw one note in here, it might reduce response times. I can tell you how our citizens do not want response times reduced. So for me, I would want to make sure that we are – if we are making adjustments in public safety, we're not doing it in a way that reduces response times of where citizens would feel. So I'd want more input on that. But today's not the day to get into all that. But I am cognizant that those have been consistently for me, my conversation with citizens, and they're free to write to me or us. They frequently do. They feel differently. But that represents how I think the community feels are our highest priorities. And I appreciate you trying to spread it out, but that's what people care about the most, and I think that they would want to see as a priority if we did have to make significant changes. And the rest of it, yes, it's going to be a significant adjustment for us, no doubt. Hard decisions, conversations like Council Members of Shader raised on historical society. A lot of organizations, a lot of folks have gotten very comfortable and used to services the city provides, been providing for years. But I really think on everything else, we're just going to have to reimagine how we provide these services. And hopefully do it in a way where we don't have to, we can reassign people to the departments and do it in a different way where we don't have to, you know, we don't have to lose employees by doing it. But in several areas, library services, parkton rec, people are not getting those services the way they did 20 years ago. There's all kinds of other opportunities for them to get lots of different services. So I've made, you know, believe me, I've tried to thank the library staff. They have wonderful programs in parks and rec, wonderful programs, fantastic. I went to one here a week or so for summer camp, a character lunch they have. One of the best programs we have in the entire city. Touches so many families in a positive way. Changes our communities for years to come. I don't think it's about, I think it's about just reimagining the way we deliver those. Ten years ago, I could have gone to Barnes & Noble, lots of places, or books a million or something. Today, I know there's one in countryside, but I don't know a lot of stand-alone bookstores. So how can we deliver materials to folks in a different way than what we've traditionally done? How can we store those materials in a different way than what we've traditionally done? I don't know. But those are hard choices I think we're going to have to make as a community and reimagine certain areas and departments in a different way, maybe bringing them forward to meet the current needs of our citizens today. But there are no doubt, if it passes, hard choices, even though, as Councilman Rall-Britton said, we are blessed with very nice resorts on Clearwater Beach and properties that will be not affected by this homestead exemption. But it's going to be some very hard decisions for the next Council to make if it passes. That's no doubt. I also want to say, though, that I do appreciate having all this laid out in a memorandum because there are some things on here that, even if it doesn't pass, I think are really good ideas on ways we can conserve money and maybe tighten our belts a little bit and going forward. You know, it's a small thing. It's not going to generate a lot of money, but just by itself that there are some other ideas. But increasing the daily rental fee for the use of Coachman Park, which has become, thanks to our great staff, one of the most popular places in Tampa Bay to hold an event, I think that that makes some sense. And I think that's something that we would want to take a look at in the next budget cycle, regardless of whether or not we need to make cuts. So with that going on for too long, but I just wanted to say, you know, this was an important exercise, a hard exercise. It will be hard for the next Council to consider. Appreciate the staff digging in, having hard conversations with your departments, with one another, to get this result. This is very valuable to me, and I appreciate the staff doing it. So is there any other discussion on this agenda? Thank you. If I may, I just wanted to point out that we are continuing to have a soft hiring freeze so that we are planning ahead should this happen. Also, the Council has suggested that they want, in the future, a military reduction, and so we are preparing for that as well. So a lot of these things, just as you mentioned, Mayor, we are putting into place now or holding the line on before we move things forward until we find out. And then we plan to regroup with Council and see what things we are to bring back and then initiate back up. Okay. Very good. Okay. Nothing else? We'll move to Item 3, City Manager, verbal. No. Item 4? Nothing to add, sir. Item 5, new business. Item 6, Council comments. Anybody want to continue talking? No? Item 7, closing comments by Mayor. I have none. And with that, we'll move to Item 8 and adjourn the special work session of the Clearwater City Council for August 11, 2026. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right. All right.