Okay, good morning, everyone, to the October 15th Financial Audit and Oversight Select Committee focused on JTA. We're going to start off with introductions. I know there are a few more people coming, but we'll go ahead and get started and introduce them when they get here. Mr. Russell will start us off. Thank you. Brandon Russell, Council Research. Mary Staphopoulos, Office of General Counsel. Philip Peterson, Council Auditor. Brian Parks, Council Auditor's Office. Bronze Salem, Group 2 at Large. Good morning, Chris Miller. We're at Large, Group 5. Will Lane and District 3 visiting. Good morning, Rory Diamond, District 13. The Beach is also visiting. Alrighty, sounds good. And we're, I think everyone in front of them has the agenda here for today, and you'll notice we're going to do the public comments at the end because I want to make sure we get into the items that we have listed before that and then whatever time is left. In that hour and a half. In that hour and a half. And I'm going to stick to that again. Again, it is my goal to stick to the scheduled time, in this case, 11 o'clock. And then I'll just mention right now while I'm saying this, our next session is scheduled for October 23rd, and it's also at 930. So I just want to put that out there. That's also been published. The schedule as we know it, five sessions, has been published as well, if you want to refer to that document that went out this past week. Okay. What I'm going to first do is, as the agenda says, there were some things that we asked about last time, and I realize not everyone from JTA is available. The acting CEO is not available today, and we were aware of that. And there were some requirements, audit-wise, other requirements that they've been understandably scrambling for the state attorney general and others that have requested these documents. So there's some information in a briefing that will, that originally I was hoping to get today, the 26-27 projections and discussion with JTA on those years, budget-wise projections. But we're going to take that up the next session, and today's going to be mostly focused on what the auditors are going to present. But before I do that, we're going to start off with any outstanding questions or issues from last time or things that came up and we want to follow up on. So I'm going to first go to past President Salem for a few follow-up items. Thank you, Chair. Through the Chair to Mr. Peterson. Listen, and if you answered this last time, I missed it. JTA does not have an outside audit yearly by a firm of some sort. We are relying completely on your quarterly reviews. Is that correct? Through the Chair, Councilman, they do have an outside audit. I believe their auditor is Cherry Beckert. JTA is a component unit of the city, and so their audit financials ultimately roll up into the cities. But as for their operational expenses and what I want to say that you're concerned about, you're relying on our quarterly summaries. We're reliant on the information that they present. We do review their annual audit, and we'll go over a component of that in the presentation today. But I hope that answers your question. Do the other authorities have an outside audit as well, just out of curiosity? Yes, sir. They each have their own audit. Perfect. Second question is, and I don't think this came up the last time, is COVID money, which I'm sure – I assume JTA got COVID money. Can you help us maybe in your presence, how much did they get, how was it spent, and did it potentially influence a delay in what we're seeing today because of the COVID money that was there? Through the Chair to Councilman Salem, that is not going to come up in our presentation today. We absolutely can look into that and report back to you. Based on what we see, and we'll get into the details, I don't know that that contributed. I think it may have provided them additional capital dollars along the way that may have – what's the term? I'm trying to think of the right word. But I think it may have contributed in a – they were doing a lot of things, and so that then where we – where the problems do occur, which – a little spoiler – is ultimately within the last two years. I think that that may have pushed it further back, thinking they had a lot more things going on than if the COVID dollars had never come in, that they may not have gotten into certain things. But I can't answer the specifics on how much they got, how it was spent. That is not – ultimately, we stopped based on when we thought they were in a good financial state and just carried it forward from there. I think that would be helpful to the committee, because if they did get into other services and such because of the COVID money, and then it ended clearly at some point, how did that influence the issue we have today? That's what I'm most interested in. Thank you. Thank you, Chair, for allowing me to say that. Sure, and I think it's a good point, and I will add on to that as far as – I guess you could call it a task – to look into. But I think that's a good start, the COVID funds, but we also know there were other federal dollars that came in for various programs, other things like perhaps NAVI and other areas that may have shored up different things. But I would like to see, as best we can, if all those funds that came from those other sources as best – like I said, as best we can – were utilized in line with how they were offered and those requirements associated with those funds. So there may be some other things beyond COVID funding there as well, and if you would, please try to see and work with Mr. Barnes and others to see if we can capture that as well. Okay, was there anything else from anyone else? So I've got a couple of things. One is I had asked, and if Ms. Shepler or Mr. Barnes would like to address this, I had asked Mr. Ferguson, and I know he turned back to you all when I asked this last meeting, about if there are documents that exist, oath of office, other related documents for the executive team members, the board members associated with codifying specific fiduciary responsibilities, something that's in writing. They've acknowledged what those fiduciary responsibilities are, related responsibilities. If those documents exist, he said he didn't think so, but he would find out. And so I'm asking, do we – I would think we would know that. Do we know that now? What is the status? Are there such documents? And in what form those documents exist? As President Sam just asked if I was referring to the board, and I was referring to both the board and the executive leadership. I specifically talked about executive leadership as well, the CEO, the COO, the CFO, the others you listed in that organization chart as the executive team. To the chair, Randall Barnes, chief financial officer of JTA, I do recall your question, and I'm sorry we don't have an answer, but we will find out today and respond back to the council auditor's office with the response to that. Thank you very much. And the second one, since you're there, the second follow-up I had was, I didn't do this from the dais. We were talking, and so, I mean, I'll just make this transparent here. I had also asked, because I noticed there was a lot of turnover through the years we've been looking at, that the auditors have been looking into the financials, a lot of turnover in the CFO office. I just wanted to get information on those individuals who had been in that office and are no longer with you, including your predecessors, CFOs, to get a feel for who those key people were and what the turnover has been in that amount of time period, which is roughly five years. So, if, I'm assuming you don't have that information available or haven't gotten the okay to release that information at this point, is that so? To the chair, I don't have the information on hand, but we can certainly turn that over to you and provide you with the number of individuals and who they are. You want the last five years? That would be my preference, but a minimum of three years. Okay. Yes, to know specifics on when they were released. I think it's important to know, did they just move on to another job? Did they resign? What happened there? Whatever is appropriate. I'm not asking to cross any lines in the HR world or anything like that or privacy world, but I just want to get a feel for that because, obviously, your current office, and before you got there, all those people are key to us really knowing what happened, when it happened, when those steps should have happened to avoid where we are right now. Yes, we can provide that information. Just for some background, I mean, just in my division, so finance and technology, we're about 50% of what we were at 10-1, 25. So there's been significant turnover just in the last year and then certainly over the last three to five years. That would be good to know, and if you could also add in there, the current employees, if you could let me know by person how long those individuals have been with JTA. Okay, we'll provide that. Thank you. Thank you. Thank you very much. Anyone else, anything else to add? Or do you all have anything that you wanted to provide, Ms. Schepler or Mr. Barnes? Okay. Well, if not, we will move on to the next agenda item, which is turning things over to Mr. Peterson and Mr. Parks to discuss the history of JTA and overall from a financial auditor perspective how we got to this point. And now realizing there's, I do realize, and if you'll just state that when you get to that point at each part of your presentation, I realize there are some questions you've asked because it's my understanding you don't have access to their systems, direct access. And so you've requested some information that will be coming later, but I just ask that, you know, as best you can, walk us through this period. And I believe you guys are starting out 23-24, is that correct? Through the chair, we're going to date back to 21-22 to try to set a baseline. Okay, that's good. That's good. Okay, just turning it over to you now. Thank you very much. Sure. And just to go ahead and address the issue that you brought up, and it's kind of to Council Member Salem's question earlier, we in the auditor's office do not have access to JTA's financial systems. We are reliant on the information that they provide to you in their quarterly reports, the information that they provide to you at budget, the projections that they make for each of those documents. And we do look at them for reasonableness. We're able to utilize information that we have access to here at the city as it relates to the LOGT and the half cent sales tax to determine if those numbers are accurate or in the ballpark, and then looking at projections whether or not they're following along what we're seeing from the state. But as it relates to the day-in and day-out operations of their payroll, their benefits, those type of things, we do not have access, so we are reliant on them when it comes to that. Mr. Peterson, before you go further, I'm just curious, and I don't know the full answer to this question. I think I know a partial answer. But to put it in context, do you have partial or full access to systems of other city-related independent organizations? Through the chair, or to the chair, so for the city, our office has read-only access to entire city operations. So everything that goes on with the city of Jacksonville, we have the ability to look into, see the detailed transactions, see the journal entries that support everything that goes on. As it relates to JEA, we have two individuals in our office who have access to their systems. One has had it for, I don't know how many years back, but we do have access and can go in and see things if we need to at JEA. As it relates to JAA and JPA, we do not have access. So similar to JTA, we are reliant on the information that they provide. I do want to note that you mentioned questions that we have sent over to JTA. One of those questions is, can we get access to their systems? Mr. Barnes is working with us, and we are in the process of getting access. There's some security things that need to be addressed, but the hope is that in the, hopefully this week, if not next week, we will begin to have access so that we can, in the future, go in and see things when we need to. Very good. And JTA, thank you very much for that. Okay, yeah, I will get out of the way now. Over to you guys. Please stop me along the way. I think it's better if you have questions, because this is, I think, 34 or 35 slides. If you have a question about a slide, just stop. I think it would be better to address it at that time. And I just do want to caveat this. We are looking at JTA's operations here, not at their capital side. We don't necessarily have any reason to believe that the capital was a contributing factor to where they are. But, however, if we come across anything, or are you here of anything, we will absolutely look into that and bring it back to the committee along the way. So, wanted to try to break this presentation up into revenues, and then talk about that, and then talk about the expenditures, because there are both contributing factors to where we are currently. Revenues is more of a 25-26 problem, but do want to just kind of give you an overview holistically of the revenues. And first, I wanted to talk on the half-cent transportation tax, because that does represent, depending on the year, anywhere from low 60s to up to 70% of JTA's budget. So, it's a driving force of their budget, and if there are big swings, plus or minus, that can have a significant impact on their operations. And so, obviously, retailers and other businesses, they collect the half-cent sales tax, they remit it to the state. The city then receives those funds from the state, typically, usually in a two-month arrears time frame. So, what was received in July was actually from May collections. The city, in turn, sends it to a fiscal agent. You may recall, during the budget, we talked about the involvement of the fiscal agent. We send the entire portion to the fiscal agent. They withhold a portion for the debt service based on a written directive between an agreement between the city and JTA, and then the fiscal agent sends the net proceeds to JTA. The remittance from the state, overall, looking at a rolling 12-month time period, had increased pretty consistently over the past 10-year period up until November of 2025. And we've got a slide to show kind of how that happened. And then the debt withholdings, those are based on amortization schedules that are known by all the parties. But there are some fluctuations. And so, over the past five years, it's fluctuated from $36.3 million in total debt, went down to about $19.7 million, and then has crept back up to $36.9 million. And so, you'll see – oh, I guess I need to keep using this clicker. So, you'll see on the blue line is the total rolling 12-month collections from the half-cent sales tax. The red line is the net to JTA over that time period. And the green line is the debt that was withheld by the fiscal agent as it relates to those collections based on those amortization schedules. And so, you'll see there is a peak to JTA in that September 24 timeframe because of the decrease in the debt for that year. But as the debt creeped back up, the net to JTA correspondingly went down because there was a – I mean, the sales tax is growing. It's hard to see in this because that's a – each gap is $20 million. But it is growing, but it's not growing at the rate at which the debt was growing. And so, this chart shows the annual activity. The prior chart was on a rolling 12 months. This is what actually occurred in each of the fiscal years. And so, while the sales tax total collections, that blue bar, is – hit a peak in 24-25, the debt increased from about $20 million in 23-24 up to $37-ish million in 24-25. So, the net amount to JTA teetered off accordingly. And if I can, to the committee. So, this is where we wanted to make sure it's clear is some people, I think, have been looking at the net sales tax and thinking that there's this gigantic cliff. As you see, it has dropped at a gross number, but it's much more impacted by the debt where it increased back up to the normal levels. And so, this – like, some people have been like, how is this dropping so much more? This doesn't make sense. It is a steady – you know, about a three to four, but it's not as dramatic as some – you know, when you're hearing some of these things may have thought. So, we just wanted to make sure, and that's what we were trying to show in these charts. Through the chair, what would cause the debt to go up so significantly? Was it road projects? Was it – was it the Skyway? Were there investments going on? I believe that some of this is going to deal with timing on refinancing and stuff of where they may have made some prepayment debts to make that go down in the future. It's not because of any new thing coming on that I'm aware of because, as you can see, $36 million was actually kind of consistent, and then there's the drop. We have kind of got different information on that. I'm not still sure, and that's one of the things that we will dig into a little bit more is to understand fully what – why they set it up that way because that's kind of the problem. If you set things up and you're using that for your operational expend, that creates problems. You know what I mean? Like, that's a one-time savings. You shouldn't be using that. We're going to – I don't want to jump ahead to a point where I think they were also thinking that sales tax was going to continue to grow at a rate where we had some differences. So, I don't want to jump too far ahead, but it's a – Just as a follow-up, in 22-23, obviously, and 23-24, the debt decreased significantly. Were there dollars added to reserves at that time? How were those extra dollars spent, or can you tell me that today? Yes, sir. Through the Chair to Council for Salem, those dollars were just plugged into their operational budget. So, they – They had more money, so they spent more money. They either provided more services, brought on more people, they – it was plugged into their budget and used in those years. Okay. I would be interested in what extra services they were providing as this money – as more money came in. What were those services, or is it a situation where we've got more money and we're going to spend it? And I don't mean that flippantly, but most companies would take those extra dollars, if they could, and add it to reserves. So, hopefully, we'll get a picture of their reserves through this process as well. Thank you. Thank you. We also welcome Vice President Carlucci. Okay. Go ahead and continue, Mr. Peterson. Yes, sir. Mr. Parks. Thank you. And I do want to address the debt that is here is related to BJP projects. So, go back in time in 2000, the city negotiated with JTA to utilize a portion of their half cent to – for construction of BJP projects. In exchange, the city then contributed the local option gas tax, which prior to that time frame, the city was keeping 100% of the gas tax, the original six cents. And so, it was kind of an exchange, and I wasn't here – I'm still in high school. But my thought is JTA was giving up a very pledgeable large revenue stream to the city to do those projects, so we kind of backfilled with them the LOGT. But the debt that is related here that comes out of the half cent is all tied to previously funded BJP projects. All right. Moving to the next slide. I want to start on the revenue side in fiscal year 24-25. Ultimately, we believe all of the issues start in 24-25. But from a revenue standpoint, this is an excerpt from our budget handout that the council would have seen in the summer of 24. And this is a word-for-word taken from our handout that on discussions with JTA, we recommended reducing the sales tax by $11.4 million. JTA was going to offset that with $7 million in non-transportation revenue related to prepayment of BJP debt and then also moving $5 million in interest earnings from their general fund division over to the bus division. And I point that out because they submitted a budget that was $11.4 million higher than what you ultimately approved. The council took our office's recommendation, but that they submitted a budget with $11.4 million in additional sales tax revenue. And I point that out because on this next slide, you'll see this is an excerpt from the year-end quarterly summary, so of 2025. And you'll note the two bold lines, net sales tax operating, you go to the far right, it came in under budget by $1.3 million. And that was after the $11 million haircut. So had that not happened, you could add another $11.4 million being under budget. Now, when you look at their budget as a whole, gas tax came in $1.7 million over budget, so that balanced each other out. And that's why you hear from us frequently that it's not a good idea to take revenue from one source and just use it because it came in over because you may have another revenue that comes in under and it helps balance each other out. And so for the year, 9-30-25, revenues were just under budget by $65,000. In the grand scheme of things, that's not that big of a deal. But so I wanted to point that out. And then looking at preparation for the 25-26 budget, this is the data that we had available, the budget office had available to them looking. And you can see that the transportation tax is on an upward trend. Even though it might be slow, it has been trending upward for a consistent period of time. This is almost six years' worth of data. And so when it came to building the 25-26 budget, the budget office had a gross projection of $137.3 million. JTA had a gross projection of $136.2 million, and that that number is before the debt is taken out. But we determined that these amounts are reasonable based on the 12-month rolling total that we just discussed was at $133.3, and the growth trend had been about 3% over that time period. We do note and did note that the gas tax appeared a little overstated. But given the trends for the half-cent sales tax at the time, analyzed together, ultimately it seemed reasonable between those two revenue sources. But then this is what happened. Oh, sorry. Yes, hold on, Mr. Peterson. Yes, Council Member Diamond, you're recognized. Through the chair, I just wanted to ask, because I remember this going on. Back to your slide on fiscal year 24-25 and that excerpt, the $11.4 million, you said something. You don't just go and say, hey, there's $11 million you need to take off of this, and the only people here is the Finance Committee and City Council. You must have talked to someone at JTA about the budget. How did that conversation go? Did they say, oh, yeah, you're right. Our bad. 10% of our collections are off. And, you know, how did that go? If I can, through the chair. Yes, please. Not well. We had a lot of pushback. Council Member Salmon may remember as the Finance Chair as well. We had to have a lot of meetings with them. And they felt their numbers were correct. I don't know if they were looking at things correctly from the debt not subtracting out. Because if you see, when you're looking at 24-25, that's when we're going back to normal debt payments. I don't know if there was some confusion with those. And as they'll move back to slide, if they didn't properly. I got brought into meetings. I'm not normally involved in independent agencies to have discussions on these projections. They did not. It was a lot of pushback. And so there was reluctance. They effectively, as you kind of see in their recommendation, they're basically using reserves when they did the $7 million thing. And then the investment pool earnings never happened because they didn't have the cash balance. So it was not a great conversation. And that's why we wanted to kind of point this out, where that kind of is this point where I think we start getting out of lack, at least when it comes to the operations budget. And that's what we're focusing in on. So, and through the chair to Brian or Phillip. And so I asked Phillip this informally like seven, eight months ago. Like how did these conversations go when you're saying, hey, we've got a problem. You guys are way out of whack on this. And then they push back on you. And it doesn't sound like they had, did they have a good argument? Like did you, in your professional opinion, be like, no. Okay. So they didn't have a good argument. And I'm going to ask the unfair question, which is always the next one through the chair. Did you feel that they were pressured to do this? Did you get any of that? And it's kind of an unfair question because that's not your job to figure out. But this is a big number. And you guys are telling them they're wrong and they're mad. Did you get any like sense of why this is happening? I don't think I can honestly answer that question because I was involved in certain meetings as it was going to this projection. I was focused in on the revenue piece, not necessarily the impact was if your revenue is too high and you need to lower, obviously you need to lower your expenditure. And that's the piece I was not more involved in. So it wouldn't be fair for me to speak to that. And I agree with you. It is unfair. But I wanted to see just in case. Yeah, you never know. There might be something said. But to the chair, we need to ask the person who's talking to Brian and Phillip and Kim, why were you pushing this $10 million gap if they're telling you, and these are smart dudes and lady who know what they're doing, why were you so upset? Why were you fighting this so hard? What was your math that we didn't know? And I hate to use the JEA example again, but that's where we started to figure out where the pressure was coming from. When we said, hey, your math is wrong. Why are you insisting on bad math? And I'll interject. You know, I don't want to get into so much of a he says, she says kind of thing, but I think it's important for us to understand the context of the conversation. Were your conversations held between you all and your office and those in the CFO's office? Or were there others involved from other positions in leadership or other parts of JTA? When we had the formal sit-down meeting to discuss this, in that meeting was Cleveland Ferguson was at that time, the CFO Raj was in that, I believe Jessica was in that, and I can't remember what budget, there was a budget person at least in there in those meetings when we had that over here, and Jessica's shaking her head yes as she was in that meeting. Okay, okay. Oh, yes. No, my question was I did not recall who was in that meeting. I think that's important to establish who was in that meeting. You just said it. Thank you. Yeah, that's where I wanted to go, and I appreciate Council Member Diamond for bringing it up. I was going to leave it to the end, but it was better addressed right there, so I appreciate you bringing it up at that point. Any comments or you just want to leave it there for now and go forward? You know, I don't want to keep going. If there was something important, Ms. Shepler, that you thought you wanted to comment on. You don't have to. We could leave it there. Oh, yes, President Salem, you recognize. Through the chair, remind me. So you pushed this narrative that this is inappropriate. You sat down with them, but ultimately they just said, that's our budget. We're going to move forward with it. And that's what eventually the, I guess, came to the city council. As you may recall, there was actually, you were involved in some of the discussions, obviously, as the finance chair. And so we worked through that. They eventually did. We kind of came to a compromise was the 11. We were actually a little bit more as what we would have even reduced to be conservative on those numbers and more match the cities. And I forgot city CFO was there as well as I'm kind of talking through this. So we, you know, talked through those numbers. They agreed to come down with these, and instead of reducing expenditures, that's when they came up with the offset was the non-transport revenue piece, which is effectively using reserves, and then some investment pooling stuff. So that was their save. So they did, in the end, you reduced that line item by $11 million through your budget process. Do you recall how much was in the reserves at that time? No, and they were explaining that this was partly from a debt piece of the prepayment, and as we were getting that detail, that was kind of pushed on that, and we did not have a lot of time. We kind of had to rely on them again. So we're not able to understand their reserve. Like, with our piece, with what we're able to see live and everything else, there's a little bit of a difference of feeling comfortable with those numbers. So we will be showing later, though, kind of where their current assets and current liabilities were from an audit of financial statements. Thank you. We'll go next to Finance Chair Lennon. You're recognized. Thank you, Chair. And through to Chair and Mr. Parks, I appreciate bringing up reserves for the first time, and Council Member Salem, I think we're on the same level here about the reserves. If you look, I really think this is an important moment for the beginning of all the problems because if you look on page six, none of those were cash substitutions. These were essentially balance sheet moves, I believe, to balance the budget. And this is really what led, okay, we're going to have less cash revenue. We're going to balance our budget through balance sheet transfers. And this ultimately was the beginning that led to, on May 28, 2026 of this year, telling the board that they had $938,000 in operating cash. And not to get ahead of the story here, but we're about to go through three or four quarters of deficit spending that ultimately led to under a million dollars in operating cash and then needing a line of credit really fast and start paying our bills on the line of credit. So I just wanted to reiterate, I really think if we could go back in time, how could you have balanced this budget on a cash basis, not just making moves to match the revenue reduction that we agreed to at the time? No, it's fine. Unless you have something you want to add to that. No, no, no. Okay. Okay. Let's go on, please. All right. Thank you. So we talked about the projections of the city and the JTA for 2526. Once again, it was based off of this constantly growing half-cent transportation tax. But then you'll see what happened afterwards. That diamond, if you will, that's in June of 25, that's the information that everyone had available at the time the 2526 budget was being approved, yet the transportation tax kind of just started going down after that, which is one of the contributing factors in the shortfalls that are occurring in the current year. So from a revenue standpoint, 2425, because of the lowering of the sales tax by 11.4 million, that yes, they used roughly 7 million of reserves to kind of fill that hole. But the revenues were not a problem in 2425. However, in 2526, they became a problem. And we'll talk about that in a little bit. Then on the expenditure side, what we have taken here is the quarterly summary for each of the last full four years or completed four years, and then shown you the projection provided by JTA for where they are as of the nine months into June 30th of 26. And so don't expect you to do math, but the 9-30-22, yes, they went beyond budget from an expenditure standpoint, but it's only to the tune of 4.8 million. In 23, they're under budget by 3.2 million. In 24, over budget, but it's only 3.4 million. But then you'll see in 25, that's the 19 million, and that's where we see the problems really starting to arise. So I want to kind of take you through, should we have seen this along the way? And so what you have on the next following pages are excerpts from each of the quarterly summaries along the way at year end for the first three years, and then we'll go quarter by quarter beginning in 24-25. And so at 9-30-22, and once again, these are direct quotes from the reports that our office issues and provides to the full council and then gives an actual report to the finance committee when they come out. So end of 22, there was no budgetary stress for JTA as a whole. All of their divisions had gone over budget, but like I said, that was just to the tune of 4.8 million. And while 4.8 million is a small number, it's still going beyond their council-approved budgetary authority. If you've sat down with me at any time regarding these, that's what council has approved, and they have gone beyond that spending authority. They come back to you with a budget amendment, whether that's three months, six months, sometimes 12 months later. Yeah, we'll stick a pin in that, please. As president Salem, you're recognized. Through the chair, this gets to where they're coming back to the council with a revised budget, sometimes was three months, six months, a year later, and we really got on JTA, as I recall, through the finance committee and other places about being more timely on budget amendments. And that's important to us, as I recall. Through the chair to Council for Salem, you're absolutely correct. I don't recall the specific year, but there were years where they were coming back 12 months after the year had ended asking for a budget amendment to be in line with their budget. At some point along the way, I believe it was you that led that charge, requested them to try to be more timely. And now when they have budget amendments, we're seeing them more in that December timeframe, so three months after the budget has ended. And I get it to some extent. If through the first nine months, you're somewhat on track to meet budget, you may not know that you're going to go over budget until the last possible minute. And given that they've got to go through the council, the process, they don't have necessary, they have transfer authority, but if you're going to go over budget, you may not know that till the end. And so they wait until their financials are a more closed state to come back to you so that they don't have to come back again. But in the 24-25 year, where it became very obvious, at least on JTA's side in that last quarter, they should be coming back to you at a sooner date to make you aware of what's going on and to seek a budget amendment. So go forward a year, 9-30-23. Once again, we say that there's no budgetary stress. We do note in here that the bus connection and ferry divisions exceeded budgetary authority. The bus division only exceeded budgetary authority because at that time, all of the revenues went into the bus operations and then they transferred dollars out to each of the other divisions. But for that, bus would not have gone over connection and ferry each went over by $700,000. In fiscal year 24, once again, we say no budgetary stress. The connection division went over by $4.4 million. Ferry went over by $20,000. And then the bus, its internal operations went over by $800,000. And they needed to come back to you for a budget amendment. Then looking at the first quarter of 24-25, which this quarter did not indicate issues, but this was the start of the issues. So we draw your attention to the bolded part that says they're projecting an overall surplus of $34,000 for all of their divisions. That is made up of a favorable revenue variance of $2.189 million and an unfavorable variance, meaning they are expected to spend beyond their budgetary authority by $2.15 million in expenditures. And not bolded, but the last two sentences of that say that they are projecting the half-cent sales tax, the constitutional gas tax, and the local option gas tax to come in at their projected amounts, i.e. at budget. We noted that this may not occur, and we'll continue to track those on a frequent basis going forward. Philip, if we could just take a pause there. I just want to ask something for clarification purposes, and also just to do a little, I would call it a foot stomp on what you just went through there. We started in 22. So there are clear indicators and clear things that were being noted and looked at, especially when they had to come back to us for exceeding what was approved by the full council for their budget. And so I just want to make sure I hit that, that what you've started with was in 22. And this picks up as you go forward here, obviously. And in our further need for involvement, but I just want to make sure that's in 22. Now, you've repeated the same statement here in these quarters up to this point, saying that they exceeded the budgetary appropriation approved by city council. You know, just for comparison purposes, for the other entities that the full city council approves budgets for, what were we looking at? I know you don't have exact numbers, but what are we looking at in the same time period? How many other agencies that we approve budgets for were coming back to us for quarterly revised budgetary adjustments to get approved? To the chair, don't hold me to this, but my, if my memory is correct, JEA has come back to you at least once, maybe twice over this five-year period. And then I don't recall JPA or JAA coming back for exceeding budgetary authority. Okay. Thank you. And I, and I think past president Salem, um, and his finance experience may be able to shed some light on as well, just, just for context. Thank you. Now, I'm going to go a little different direction. I would love to know, um, where the board was on some of these. Can we match up, um, information that was going to the board at the same time, or their minutes along with these discrepancies were reports going to the board? Were they discussed? I think that's a critical component of this. And, uh, somehow we got to get minutes to see what they were told because if they weren't told, that's a problem. And if they were told, what was their response to the chair? I'm going to try to answer that question and I'll defer to JTA if I get something wrong. But based on a presentation that Mr. Barnes gave, uh, last week in committees, uh, when we were discussing the $30 million loan of LNGT funds, I believe he had a, a bullet that said that the projections were not being provided to the board. So without having projections, I don't know that the board could have known that they were going to exceed budgetary authority. The board did approve budget amendments. That was always a requirement that's attached to all the pieces of legislation that you see, but that's an after the fact issue after it's already occurred. Let me clarify. I'm not trying to blame the board. I'm trying to, to, to determine the facts. What was occurring? Was the board informed? If they weren't informed, then you can't blame the board. Then it becomes an operational issue, um, that the board was not informed. And that's a whole other problem that we need to correct in all our authorities, much less JTA. I don't disagree with you at all. And I think that was the point that Mr. Barnes was making when he made his presentation is that the, because projections were not being provided to the board, they wouldn't have known. And that is a staffing issue, which is now being remedied because they are now providing projections to. And let me just make, if I'm a board member, I am sitting home angry as hell that, you know, the, the board is, is there for that very reason. And they weren't provided the information they needed to have to make appropriate decisions. Thank you, chair. We'll go to Mr. Barnes. I'm, I'm assuming you want to comment on, on that line of discussion. Yeah, please do. Yeah. Thank you, uh, to the chair, to the committee, just wanted to clarify what the board does, has been receiving. So they do receive, uh, reports, financial reports for every board meeting that are for the prior, up to, through the prior month and year to date, they do not, they have not been receiving, uh, projections, which we will provide going forward, but that is not something that we have provided. Okay. Thank you. Well, we'll, we'll next go to, uh, uh, council member Dimon, you recognize. Thank you, Mr. Chair. Uh, I wasn't gonna ask this board question until later, but I, you jumped right on it, uh, councilman Salem. I mean, to me, this is a, it's wild to be on a board and not to get projections. And then it begs the second question, were they intentionally not given projections because they were so bad? And that's a question we need some people at this podium to answer, including, um, I think that board needs to answer some of these questions and the board chair. I think they need to be up there. That's just my two cents. Uh, but I was going to ask a more tailored question on these, these updates. Cause I remember looking at these, I remember, I remember this language JTA is not seeing any budgetary stress. And for a guy who didn't like a lot of what they were doing, I'm like, well, at least they're not breaking the bank. And now you're telling us, yeah, by 24, it was at least obvious that their projections were being very generous. And, and, uh, but here's my question, uh, through the chair to Phil, at what point did your discussions with JTA, you know, money people, the budget people go from just normal dealing with Jacksport and JEA, just professional numbers, guys going back and forth and ladies to tense. Like when was the earliest time this stuff started to get a little less fun? And just for the committee, I think that's going to start to tell us where the people side of this started to go sideways. Through the chair to Councilman Diamond. Um, I don't know that I would ever classify our interactions with them as tense. Um, and I, I hate to do this in a public setting. They've always been the most difficult agency to work with. Responses are not, have not been timely in the past. Um, responses didn't necessarily make sense when we got answers to our questions. Um, but it was never uncomfortable dealing with them. Um, it just, just, it was not, we were not getting great information on a, on a quick turnaround. Okay. So two things. One, I think that's a Jacksonville problem that we aren't more honest about, Hey, this agency is hard to deal with. We need to get that stuff out, that they're not giving us timely stuff. That is not, you've got to get the auditors the right stuff on time. So that's a comment. If I may, Councilman Diamond, um, your line of questioning there. Um, uh, okay. Roughly what time period are we talking about here? I mean, I want to, I've just a rough timeline. You said, you said, you know, what's your assessment as the auditor working with all these agencies is. Are we talking five years? We talking 10 years? Through the chair or to the chair and the committee. Um, so I've been with the city for 21 years. I've worked with independent, independent agencies. Like that was one of my first jobs when hired in 2005, transitioned off of them, came back, transitioned off and now back again. As long as I can remember, it's been that way with JTA and I'm not going to give them a pass, but they are a little bit different of an entity being a state semi-agency, however you want to classify that. Right. Uh, whereas JEA, wholly owned by the city, that's a different animal. JEPA and AA, just, I don't know, luck or just great people all along the years. I'm not aware of any issues. I take that back. We have had issues. with, uh, one of them along the way, but we've worked through it. Um, so, but as, as unfortunately, as long as I can remember, it, it's been pulling teeth to, to get stuff from JTA. Okay. That's important to know. Back over to you, Councilman, Member Diamond. Uh, thank you, Mr. Chair. And I just had, like, one follow-up because I'm just trying to get my timelines, like, in my head here. So, uh, you tell us that in 24, 25 budget, like, you're like 10 million, 11 million off. They're giving, they're like, no, we like our bad numbers, no matter how smart you guys are. When was the first time those kind of conversations were happening? Like, can you tell us, like, at what point where you're like, hey, you're being very generous with your projections? It looks to me like that's probably for this, uh, when this 24, 12, 31, 24, uh, quarterly summary is coming along. Is that when things started to be like, look, our numbers and yours are just not, uh, jiving together? Yeah. So Mr. Parks and I were making sure our answer was the same. Um, always good. So, and I say that because both of us have worked with different agencies at different times. And, uh, the 24, 25 conversation, he was involved, I was not involved at all, but that was kind of the first significant pushback we got from them. We would have disagreements, uh, in the past, um, but we're able to work through them in one way or another, um, and, and get to a resolution that we felt comfortable coming to you with. That was the first one that kind of really stood out where there was pretty significant pushback from them, unwilling to, uh, necessarily meet us somewhere along the way. Roger. Thank you. Thank you. And, and, uh, I should have said this earlier, but we welcome, uh, Council Member Clark Murray as well. And I'll next go to, um, the Finance Chair Lennon. You recognize? Uh, thank you, Chair. Uh, first of all, I'm still amazed from last week hearing that the board members did not get projections. And I think I'm just as amazed that, I mean, these are seven pretty accomplished people that no one was asking for projections. Uh, so through the chair to, uh, Mr. Peterson, could your team look at the other independent, independent authorities sometime the next few weeks to see if their port, uh, board packages, uh, contain, uh, projections? Because again, actuals are important, but not nearly as important as the projections telling you where you're heading. Uh, and same thing with cash position. I'd just like to know because, uh, I know on the May 28th JEA board meeting, mainly because I asked a week prior to that, what the cash on hand was concerned about all the, uh, quarterly deficits that we had for three or four quarters in a row. I wanted to make sure that they were going to update the board. So I do know that they, uh, had that in the board deck. I don't know how much conversation there was on the fact that they had less than a million dollars remaining for cash on hand. But I mean, I think all of our independent authority board members should always get projections and they should always know the cash on hand. And I was just discouraged to hear that that had not been happening. Thank you. Thank you. And I, I don't, you know, you, you went through that in a very efficient manner. I don't want to lose the fact that we talked a little bit earlier about they, they weren't being provided that information, but it is on the board to ask for that information. If they're not getting what they need to make good board decisions. So I wanted to, I wanted to hit that one a little bit as well. And we'll go next to vice president Carlucci. You recognize. Okay. Thank you, Mr. Chair. Um, and I, I kind of had the same exact, did we get a hundred percent clarification from JTA that the board didn't get these projections? Can someone answer that? Cause I kind of heard, Oh, well maybe they did, but maybe they didn't. What did they, or did they not get the projections? Uh, through the chair to council member Carlucci, to my knowledge, they did not get projections for fiscal year. I mean, they're, they're provided actuals and year to date. Okay. Uh, monthly actuals and, and year to date, but not projections. Okay. Understood. And to reiterate again, no one asked for, asked for them either. I, I wasn't here. So I, not to my knowledge, not while I've been here, no one asked. I don't know who the correct person or entity is to do this, but I, I, I agree with the earlier recommendation. Let's go back through the board minutes, tapes, whatever it is. Um, so we actually check and verify, um, you know, versus what we think we remember and let's, let's match up what's been said to make sure it does in fact, uh, match up what actually occurred. Um, so I'm not sure who that is. Does anybody have a, have any thoughts for me to make sure that we, we do go back and do that? Yeah. Through the chair, uh, we'll commit to going back through, uh, board packets to see what was included in them. Um, minutes don't always give a great picture of what happened, but the packet should, whether or not those are included, we'll report back to you. Very good. Thank you very much. And one other thing while I, I have the floor, Mr. Chair, um, I guess, and this is another question to OGC, is there, is there policy or action that we can take from the council side, like an ordinance or whatever to require that, or is that just an internal change for JTA to make and hopefully keep? Through the chair to council member Carlucci, not, not really. Um, if they're not even, JTA isn't even in the charter with risk because they are a state hybrid agency, they were created by virtue of a state statute. So you're really not in a position to legislatively, uh, enforce or address how their board meetings and what information gets shared, et cetera, with respect to JTA, like you might be with some of the other independent authorities that are. Do, so, okay, got it. Do we, through the chair, require them to come before us though and give financial updates during the budget? The charter provides, because they are an independent authority and they're not, they're not, they don't have their own section in the charter, but the charter provides that the independent authorities come to you for budget approval each year. And so that's why you see the amendments that occur periodically mid year. Um, but it doesn't require other than the present presentation of their budget for approval or amendments there too. It doesn't require that they provide reporting throughout the year. Okay. And we can't require them to give us reporting throughout the year. Through the chair to council vice president Carlucci, based on the language that's in the charter, I don't believe you can, but you can always request it. And a lot of reporting comes through the council auditor's office as well. So to a certain extent, you may get some through them. Okay. Through the chair to, Mr. Parks, did you have something for Phil? Through the chair to council vice president Carlucci. So they do provide the quarterly reports to us. So there is some level of reporting. I'm, we were trying to determine if that's included in the ordinance code or if that's in their, uh, chapter 349 of Florida statutes where their operations are laid out or maybe it's in both. I don't have that off the top of my head, but we are getting some level of reporting. Um, I don't know if you're looking for something more or I'm just, uh, and I'll let last point, what I'm trying to do is make sure that their board is getting the projections. So if that's via, uh, you guys getting it and sending it to them or them just creating a new internal process and actually sticking to it, then like fine. But that, that's all I'm trying to do. Through the chair to council member Carlucci, I can, I can certify that we're going to be providing projections going forward. So no, no issues with that. And I also just want to say anytime these guys say something, I'm, we're going to listen to them. Uh, I've worked with them for a long time, so there aren't going to be any tense arguments. If they, if they bring up a point, they're probably right. So we're going to, we're going to work through it and understand it fully. Uh, just wanted to make that point. Thank you. Anything more? Okay. Um, just a quick, um, point from past president Salem, then we'll go over to, uh, council member Clark Murray. Thank you, chair through the chair. I don't know if we're ever going to, uh, through this process, bring in some, some, I don't like to use the word witnesses, but, but I'd love to get a board member in here, preferably the board chair and to ask him or her what they knew. Did they, did they ask about projections? Uh, did they have any understanding of the financial situation of JTA, uh, through this period of time? That may be a couple of board chairs, but, but, and there's been some names that have come up that were in some of these meetings that are still with JTA. We need to hear from them as well to understand what they were thinking because something went astray here. Thank you, chair. Thank you. Um, we'll go next to council member Clark Murray. You recognize? Thank you, chair. And good morning to everyone through the chair to Ms. DeFopolis. We, um, council member Carlucci just talked about what type of authority we have. Um, first of all, I know that the, the charter, are we able to revise it before or amend it before that annual or that, um, 10 year or whatever the revision, um, date or process or time is? Through the chair to council member Clark Murray. So there is the charter review commission that you're thinking of. Yes. There's different ways in which the charter can be amended. You can amend by referendum. You can amend by a J bill, a local bill being processed through the, through the state legislature. And then there's certain exceptions where you can do modifications to the charter that are non-substantive, et cetera. There's a few exceptions to those rules. Uh, but the, the, the difference for JTA is that they are not in our charter like the other independent authorities are because they are created by virtue of state statute and they are a hybrid state agency. You'd probably be more looking at, is there a way to amend the state statute specifically? And that you could do that through a local bill. Um, but there's, they're a little different in that regard just because of what they are. Thank you so much for that. And also through the chair. So resolution, can we draft the resolution to prompt the state to add the changes that we want that are necessary? Seeing that this is unusual circumstances. Through the chair to council member Clark Murray. So normally when you do a resolution to prompt an adjustment to state law, that would be of local application, you would do that with a J bill being included that's sponsored by a member of the delegation, a representative member of the delegation that takes it to the state. You also have the ability to the extent the council wants to take a position via resolution and just put it out there to the delegates. If you wanted to address it to the, the Duval delegates, that there's an, a desire of the council for some action to be taken, maybe not necessarily through a J bill, but to see if any of the delegation members says, I agree and wants to pursue legislation on their own behalf, you know, to the extent that you have the ability to speak with delegates about the interests of the city and its independent agencies and see if they would sponsor their own legislation, not necessarily through a J bill, you can, you can do that. But otherwise, normally the traditional pathway is to do a local bill so long as it's only of local application, which what you're discussing pretty much would be. Right. Thank you. Thank you, Mr. Popolis. Thank you, Chair. Thank you. Good discussion. Thank you very much. Back to the regularly scheduled program here. Thank you. All right. So, um, indicated at the 1234 quarterly summary, they were projecting an overall surplus of 34,000. Fast forward three months, the 331, 25 quarterly summary. JTA is projecting, uh, overall surplus of 2.3 million, uh, which was made up of a 4.7 overage in revenues and an overexpending of 2.4 million and expenditures. Uh, we did note that the overall net surplus, uh, does assume that the half cent constitutional gas tax and the local option gas tax all come in at the budgeted amounts. And, um, while this might not occur, we were going to continue to monitor those going forward. So we went from a 34,000 surplus to a 2.3 million dollar surplus. And then at the 6 30, 25, they're projecting an overall surplus of 3.9 million. So from 34,000 to 2.3 million to 3.9 million. Um, and then once again, we know based on the information that we had available to us at the time, they were still projecting to come in at budget and that appeared reasonable at the June 30 deadline. Then we get into the 25, 26 budget. So the June 30, 25 quarterly summary is due to the council at the end of July. You adopt the budget for JTA and all the agencies in the city or finance does in mid August. So, uh, wanted to draw your attention to two items, uh, specific items that came up in that budget review. Uh, one was the bus, bus division services category, an increase of 5.7 million. And we noted at the time that 10.8 of that was due to an increase in NAVI and the autonomous innovation center. Um, there was partially offset by a decrease of 3.1 million in their professional services line. When we asked about this decrease, no explanation was given on how they were arriving at those cuts. Then in the CTC, uh, which is the connection service, uh, the budget was decreasing by 642,000. Even though the year 24, 25 that we were currently in was expected to exceed budget by almost $4 million, they were wanting to budget a decrease in that service. And then the next bullet shows some items that made up that, um, those numbers. And that first line just kind of reiterates what we were talking about earlier. It was reduced, due to a reduction of 863,000 in contractual services. However, when we asked about this increase, no explanation was given on how those cuts were going to be made. We were separately notified by JTA that they were going through cost cutting exercises, uh, that would help cut $7 million within their budget. Uh, there were, we did receive a, uh, spreadsheet on it. It was not the most detailed, um, but they were actively trying to address these measures. So that's August of 2025. Then the quarterly summary, for the year end, we went from 34,000 projected surplus, 2.3 projected surplus, 3.9 projected surplus, and then we find out that they are ending the year in an overall deficit of $18.9 million. So this, and this is where reliance on their projections, they can appear reasonable to us, but we, we do have to rely on them if nothing stands out entirely. Um, and so this, this is the first year that there, we see significant problems, and this is on the expenditure side, an $18.9 million issue. Bus and connection, uh, both exceeded their budgetary appropriation. Um, bus is where NAVI is buried, if you will, and the connection is, uh, the connection regular service, and then the connection plus service, um, both exceeding their budget. So that's 9-30-25, which, uh, for your reference, the year end quarterly summary, they, every entity gets an extra month. So you and us would have received this at the end of November 2025. We make this report, our, our office is required to turn around this report within 15 days. So by December 15th, and more than likely, if my memory serves me right, council had already met. You go on a two to three week council break. We come back in January to present this information to you. Councilor Merlin and Scott, the mic's on. We have council member, uh, Diamond in the queue first. So we'll go, we'll go to him. I'll be quick. Uh, cause I don't want, I know you've got a hard deadline, but through the chair to fill up. Okay. So budget surplus, 36,000 surplus, 3 million, 3 million, 3 million, 18 million deficit. Did you like drop your chair? Like, were you like, this is wild? Like, what was your reaction to this? Um, through the chair to council member Diamond. So I was knee deep in legislation at that time. So I didn't, I wasn't really involved in this aspect. Kim would have dropped her chair. Correct. Yes. Okay. Um, which that's not my real question. My real question is this, the, the, the wild variance between what they were reporting from the third quarter to the end of the year was over 21 million dollars off on 140 something million dollar budget. Did that tell you that there was a significant problem with how they were doing their budget map? And given the gap is 20 million, how much of that would you attribute to new projects, i.e. Navi? So through the chair to council member Diamond, that, that was our, I won't say our initial, but that was confirmation that projections from an entity that you don't have access to, um, that we can't fully rely on them. And I'm not saying that anybody was trying to mislead anyone along the way, but that, that was kind of, all right, the red flag is for real up now. Not just, hey, we think there might be something. That was, that was the red flag of we've got to, we've got to figure something else out when it comes to these independent agencies. And, and how much of that did you guys attribute to this new expense of, of under buses for Navi and the connection center? So through, through the chair to council member Diamond, that's the reason we included that prior slide, um, right there that they were projecting nine, 10.8 million for Navi in the 25, 26 budget. Navi went live, uh, we looked this date up yesterday and I'm drawing a blank, but it went live sometime in 2024, I believe. Maybe it's 25. Um, so that, that is a contributing factor to it. The other factor, um, and I will get into this, um, in 25, 26 quarterly summaries, but the connection plus service greatly increased in cost, uh, in a relatively quick timeframe that I don't think JTA was ready for. Um, and then they under budgeted on their fringe benefits across multiple divisions on multiple occasions. So the, there's, those are the three big contributing factors we see that got to this point. All right. Thank you very much. Hey, and, uh, no apologies needed. This is very important, uh, to go through these discussions. I, I, I'm happy to push the rest of our agenda to the next meeting to get into these kind of, uh, discussions on these specific points to get to the, the, the core of the types of factual things that we were, we're chartered to explore and get to. So no apologies needed. We go next to Finance Chair Landon. Thank you, Chair. And just to remind everyone, we had a robust conversation about this on January 6th. Uh, I think I kind of led the charge on that. It was actually a $23 million swing quarter over quarter on 140 ish million dollar company, which is just unheard of to come in, uh, that much over and to be projecting that inaccurately. And really what I've gathered through the past stuff from committees last week and this meeting today, we were voicing our concern to JTA leadership. And I don't think any of that concern was ever getting back to the board unless they were asking us, ask these questions. Uh, we were talking about the projections. We were talking about cash on hand. And my concern is those same questions were not getting discussed at the board. It was, we see what the council audit is. It still baffles me that we were getting projections from JTA, but yet the board was not getting the same projections that JTA was providing to city council. Uh, and I think as, as we go through here, uh, sequentially quarter over quarter, we're going to start seeing, we even talking about sales tax, right? There's a lot of expenditure side stuff, not just revenue stuff that we need to talk about. Uh, and I talked to Mr. Barnes about this. I mean, there was just some, some bad budgeting and some bad, uh, basic financial operations with what they were doing from whatever their closing forecast process was kind of just the, the basic finance one-on-one. We're going to talk about a lot of those red flags, I'm sure. Uh, and just like jumping ahead to the next quarter, maybe my, uh, favorite, maybe favorites, not the word, but when we get to the next quarter, JTA submitted their report past the deadline, but due to errors, they then had to resubmit it two separate times. Um, and so again, I just think this is, uh, that's why I'm so happy we have Mr. Barnes because, uh, there's some cleanup that needs to be done, uh, within the finance department side of things too. So we're projecting more accurately. Uh, you're going to see, there's a couple budget errors I'm sure are going to be talked about. Like, I don't know how you can accidentally budget for half a year of a known contract instead of a full year. So anyways, I doubt we're going to get done by 11 by one to, to share those comments, uh, while we're on that subject. Thank you. And, and something that, uh, finance chair, Laney, had pointed out, um, you know, there, there are discussions, and I'm, I'm sure we're going to get into this as we go further into this presentation, that leadership, um, had between members of, of city council. And, and so, um, you know, I think it's important to recognize what those conversations were, who knew and who had opportunities to, to engage and, uh, and make adjustments. So yeah, please. Oh, thank you chair. Just, we keep mentioning the board and we, and we need to determine what the board knew. We can't hold them accountable if they weren't provided some of this information. So matching packets is, is, uh, Mr. Peterson has indicated, uh, to see exactly what went to the board. That's what we need to see. Yeah. And I will discuss with, uh, with OGC, I will, I will discuss, um, process, um, requests for board chairs, uh, to come and, and meet with us and, and what the proper way forward is with that. But I certainly agree. And, and I do want to pursue that. Um, oh, oh, Mr. Hoppus, you want to comment now? Okay. It, it's up to you, Mr. Chair, if you would like to have that conversation offline, I'm happy to have it. I mean, generally, I would just say you would, you would ask them to, you can't, you don't have subpoena power as a select committee, which I know you're aware of, but you can certainly reach out to the respective board chairs and requests that they attend. Which I definitely will. And then we'll, we'll go from there. Hopefully it'll be a cordial type of exchange and, and everyone will work well together. Um, but if not, we have, we have other ways. Yeah. Yes, please. I just want to, uh, Mary's obviously exactly right, but let's not forget, we can go to any standing committee and get the authority we need. And, and I would go through, oh, excuse me, microphone. I would go through rules in this case, uh, if that's needed, but hopefully it's not needed. Thank you. Um, back to, back to Phillip and, and Brian, please. All right. So what, want to kind of point out one thing that could get missed in all of this is the, the 9, 30, 25 quarterly summary would have been submitted in end of November. Our office publishes the report in mid December finance committee goes over at the beginning of January, but the 25, 26 budget has already been adopted and is somewhat based off of the 24, 25 activities. And because at the 6, 30, 25 quarterly summary, we didn't know there was a problem, 25, 26 immediately becomes a problem. So jumping to the 12, 31, 25, uh, quarterly summary, um, we point out, hey, there, there are, they're projecting to finish the year at budget with no budget variances. We noted items, we didn't include our whole writeup because it's multiple pages, but we noted items where these projections are probably not going to be realized, um, jump to the 33, 31, 26. JTA is projecting an overall deficit of 2.2 million at year end, um, despite making significant cost reductions throughout the year. You may recall their board, um, adopted cost reductions in the February timeframe, uh, because of the, I believe that conversations that happened at finance committee in January and knowing where their budget was for 26. Then we go from that 2.2, which is, you can deal with that, but then we go to 630, 26, and there's an overall deficit of 31.8 million made up of a $17 million shortfall in revenues that we covered earlier meeting and then, uh, uh, in excess of $14 million in, uh, expenditures. And that's kind of where we stand right now. The 930, uh, 25, we won't know where they finished. That's not due to you until the end of November. Um, but I believe it's been pretty well documented that there, there are significant issues, um, that have gone on. So as it relates to revenue, uh, for the 630, 26, uh, there, that was made up of multiple sources. Uh, the, the net sales tax and constitutional gas tax would flow into the same line where $10.5 million under, uh, interest earnings were down 3.3 million compared to budget because they just had less cash invested. Uh, the gas tax collections were down and then also passenger fares were down because they had put it on a temporary hiatus while they did their passenger fare study. On the expense side, uh, 8.4 million of it was related to the CTC, uh, the contract for the service provider not being budgeted for the full year. And then the fringe benefits category, uh, not being budgeted accurately, which they, um, alluded to in their, in their, uh, memo to you. Um, and so these next couple pages look at each of the divisions year over year, similar to what we did earlier when they were all combined. And so just kind of looking, 22 buses up by 1.1 million, not that big of a deal. 23, uh, buses under by 3 million. Look at 24, buses up by 700,000, 800,000. And then in 25, you see a significant increase of 12 million dollars, which would attribute, um, I'm not aware of any additional services that they added other than NAVI. So to Councilmember Diamond's prior question, I think that's a contributing factor in 25. And then you see in 26, uh, as of 630-26 projected to be over budget by 6.5 million in the bus side. On the CTC side, um, 22, 500,000 or 600,000 over budget. In 23, 700,000 over budget. In 24, that creeps up to 4.1 million. In 25, 9.7 million. And then in 26, uh, projected to be over budget by 8.4 million. And one thing I should note is that the contracts for, uh, CTC, the connection services, are based on the ridership. And so they, they're paid by the rider. So the more the services are used, the more it ends up costing them, um, which is something that we wouldn't necessarily be able to project because we're not into the ridership details, um, that they're utilizing. Uh, when looking at the Skyway, this is clearly not a problem. The, there's a over budget by 700,000 in 22. They're under budget by a million in 23, over, uh, under budget by 300,000 in 24, and 2 million in 25. And then they project to be around budget at 26. And then the ferry, similar stories, um, 260,000 under budget, 700,000 under budget, 20,000 under budget, or sorry, over budget, 500,000 under budget, and then for 26 projecting to be over budget by 400,000. And then their last division is the general fund, um, similar story. And you can see the numbers, uh, there. So that takes us back to the schedule we looked at 45 minutes ago. At 22, 23, and 24 are not really the problems from an expenditure standpoint. It's 25, that 19 million being over budget, and then 26 projecting to be over budget by 14.4 million. Um, due to time, I won't necessarily walk through the next couple slides, but these are summaries of, uh, their budget amendments. And while they did come back to you for budget amendments, do going over budget in the various areas in 21, or sorry, in 22, 23, and 24, they had excess revenues that offset going over budget. So while they did go over budget beyond what council approved, they had additional revenues that could cover those areas. In 24, 25, they did not have additional revenue to cover that 19 million that they went beyond budget. And in 26, um, which we don't have the year end, they're not going to have the additional revenue as stated earlier when they project a deficit of 31 million for the year. Then to, uh, an issue that Council Member Salem brought up earlier, just wanted to kind of bring in their financials to show that, um, we do think it's truly isolated to the last two years. This is their current assets and current liabilities taken straight off of their financial statements. Um, and you'll, I'll draw your attention to, and thank you Mr. Parks, this is for the bus, Skyway, CTC, and ferry services. Um, draw your attention to the far right column where you see the net change in the assets versus liabilities. There's going to be ups and downs, but there's a significant down at the end of 24, 25. And I would expect a similar thing for 25, 26. Uh, we won't get those numbers until the spring or summer, um, next year. So what conclusions do we have? Uh, it's really isolated to those two years, 19.7 million dollars of an additional, of additional reserves over the planned use of 7 million. You remember when we were having the discussion about cutting sales tax by 11 million, they filled that by using 7 million reserves. So 26.7 million of reserves used in 24, 25. And then based on what is going on currently projecting to use roughly 32 billion of reserves, um, in the current year, or I should say in 25, 26 last fiscal year. So very high level recommendations, um, budgetary controls need to be in place prior to purchase orders being created, direct payments, and other items. Basically, if there's not budgetary capacity, they shouldn't have the authority to go and spend those dollars. That is, uh, a, easy control to put in place. Mr. Barnes has indicated he's already, uh, either put it in place or is working on putting that in place. Uh, but that is a, a control that would help prevent on future, uh, exceeding budget, uh, forecast. We've spent a lot of time on that. It needs to occur more than quarterly summaries, especially in their current financial state. Uh, should be constantly tracked and projected throughout the year. At this point, we would say no less than monthly given their, their current financial position. Uh, forecasts need to be presented to the board in public meetings so that not only is the board aware, but the public is also aware of where, uh, the financial state of JTA. And then we think consistent with 26, 27. So I'll take you back to, uh, the finance hearings this year. JTA took a very conservative approach on their half cent sales tax for the 26, 27 budget, knowing that if there's another dip, they would be able to weather that storm to some extent. If there's an uptick, well, that just helps replenish their reserves at a faster pace. We think that approach should be taken in future budgets because it does represent 60 to 70 percent of their operating budget. And if that one line has a dip like we saw in 25, 26, that's only going to create future problems for them and happy to answer any questions. Thank you very much. Uh, we'll, we'll first go to, uh, pastor president Salem. You're working best. Thank you for that presentation. And this is through the chair to, to Mr. Barnes. If the dollars are not there, you're indicating the services won't be provided if I heard you correctly. So you could be in a situation where revenues are falling and you've got to change bus routes or, um, paratransit on a dime, essentially. And you've got to, is that what you're suggesting? It could be that drastic a situation that, um, I don't want to say month to month, but on a quarterly basis, if things do go south, you've got to take immediate action, which might mean cutting back on those services. Uh, through the chair to council member Salem, I would say that's correct. I mean, it's difficult to make changes to routes and to frequencies on a dime. Uh, but we do, you know, with, with the, with the council's approval last, last week, um, you know, we did get access to the LLT two dollars, which we're going to be able to use to pay down our, our, uh, line of credit that's outstanding. And so we, we will have the balance of that line of credit outstanding to weather through periods of, of time and to give us time to be able to make adjustments like that. So liquidity management tool. Okay. Thank you, chair. Thank you. We, we're gonna, we're gonna have to stop, but if we've got a quick one, council member, uh, diamond. Okay. Yeah, please. Uh, and really it's just a suggestion to the chair. I mean, I think I have a pretty good theory of the case as to how we got here. I want to wait till we see all the evidence come in to fill some of this out and ask some more questions. But to me, I don't know how we can do our job if we don't ask Nat Ford some questions. I just don't see how we can finish this out without asking the guy who's in charge of all this. Why did you do this in 2023 and 2024 when you're getting this information? Why did you keep going down this road? I think the people of Jacksonville deserve to hear that. And I don't care what state he's in. I think he should voluntarily come here and speak to us and just be honest about what happened so that we can, at the end, compare the evidence to what happened. And the board chair also. All right. Thank you. Um, we're going to have to stop. My apologies to Mr. Oliver. We'll catch you at the next meeting, which will be on the 23rd at 930. Uh, thank you everyone. Um, we are adjourned.