Oh, yeah, Mr. Big Stuff, who do you think you are? Mr. Big Stuff, you're never gonna get my love. Now, because you wear all those fancy clothes and have a big fine car, oh, yes, you do now. Do you think I can't afford to give you my love? You think you're higher than every star above, Mr. Big Stuff, who do you think you are? Mr. Big Stuff, you're never gonna get my love. Now, I know all the girls I've seen you get. I know you broke their hearts for half another, now, bit by bit. You made them cry, many poor girls cry, when they try to keep you happy, they just try to keep you satisfied. Mr. Big Stuff, tell me, tell me, who do you think you are? Mr. Big Stuff, you're never gonna get my love. I'd rather give my love to a poor guy that has a love that's true, than to be fooled around and get hurt by you. Cause when I give my love, I want love in return. Now, I know this is a lesson, Mr. Big Stuff, you haven't learned. Mr. Big Stuff, tell me, who do you think you are? Mr. Big Stuff, you're never gonna get my love. Mr. Big Stuff, you're never gonna break my heart. Mr. Big Stuff, you're never gonna make me cry. Mr. Big Stuff, tell me, just who do you think you are? Mr. Big Stuff, you're never gonna break my heart. Mr. Big Stuff, you're never gonna make me cry. Mr. Big Stuff, you're never gonna break my heart. Mr. Big Stuff, you're never gonna make me cry. Mr. Big Stuff, you're never gonna make me cry. Mr. Big Stuff, you're never gonna break my heart. Mr. Big Stuff, you're never gonna make me cry. Mr. Big Stuff, you're never gonna make me cry. © BF-WATCH TV 2021 ლილილი Probably the last budget and finance meeting of the calendar year 2010. Welcome Commissioner Rumke. Thank you. Glad to be here. Welcome to our exciting time to reveal our increased revenue streams that are coming in just rapidly. Right? Hopefully. Okay. As usual, the first item on our agenda is review and discussion of FY 2010 revenue. So take it away, Commissioner. Thank you very much, Chair, and happy Thanksgiving to everybody. I hope you have safe travels, you and your families. Just a quick update. At the next meeting and all meetings going forward, given all of the discussions we've had over the last several months, we're going to change up the report just a little bit and add a couple more slides. And I'm just giving you a heads up so that we're not just looking at general fund performance, but we're looking at all the major fund performances because they are so interrelated and because we feel it's important to have an overall temperature on the health of the urban county government. We're going to be adding those to future presentations, and I just wanted to give you a quick heads up on that. So... There we go. Just a couple opening remarks. We've talked in various meetings the last month about the Federal Reserve getting ready to inject about $600 billion into the economy over the next few months. And as you know, the markets have been reacting wildly. Bond prices have gone up, and in fact, you know, currently both of the refundings or refinancings of our existing two bonds that we had brought to counsel, they're currently out of the money. So the good news is our bond documents are very flexible, so we have a window that we can still use these existing bond documents, but given what the markets are doing right now, it doesn't make a lot of sense for us to do that refunding. I bring that up just in the context that this whole injection of capital to stimulate the economy is having that effect on the bond market. And that coupled with the fact that municipalities across the country are rushing to take advantage of those various stimulus opportunities that are sunsetting at the end of the year, as the urban county government is as well, the economic recovery zone being one of those. So we'll keep a close eye on the bond market, but wanted to make you aware that right now, as it stands this morning, both of those refundings are really off the table, but our financial advisor will keep us posted on a day-to-day basis, and we will keep all of you posted. And I don't know, this is kind of hard to see this time for some reason. I apologize. Hopefully you can see it on your handout in front of you. With all the factors in play that we're facing right now, obviously being fiscally conservative is going to serve us well as we navigate through this delicate 18 months ahead of us. So with that said, we're taking a look at our unemployment rates. And the national unemployment rate has remained flat. It's been 9.6 percent the last three months. Now, the interesting thing is that the state is pretty much following suit on that, 10 percent in August, 10.1 in September, and then back to 10 in October. So we're seeing kind of a three-month trend there. God forbid that I would use the T word, trend, because just as soon as I do, next month it will be something crazy. The good news is the state released their numbers last Thursday, and year over year from October, they're down 0.7 percent. So we are seeing a decline at the state level. As far as the Lexington MSA and Fayette County, those October numbers won't be released until December 7th, and I'll be happy to send that information out to you when it is released. But if you look from August to September for the MSA, we went from 8.6 percent down to 8.1 percent, and then in Fayette County we were at 8.3 percent in August, down to 7.8 percent in September. And so I guess the question is, is September a blip? Did the WEG games suppress some of our normal run rate in September? We're really not going to know until we get those October numbers. So I will be sending out additional data on that. Given that I don't believe we have a Budget and Finance Committee meeting in December, I want to make sure that we keep everybody in the loop as we're looking at all these other financial-related decisions that you have the most up-to-date information. The next slide is what we're calling the Beard Report. We love this report. It's actually taking that first slide and taking the seasonality out and smoothing it so it just gives you a better feel for what we look like. But the trends themselves primarily stay the same. And there's Fayette County that we just talked about. So let's flip over and talk a little bit about employment. The good news is Fayette County was up 2,460 jobs, and those are non-farm jobs, and the state was up 7,300 jobs. So that was really exciting news that we're seeing non-farm, non-seasonal-type jobs being added to the economy. I did take the liberty of doing a little more research on the state side to give you an idea of which sectors are picking up. Leisure and hospitality, with seasonal adjustments, have actually added 3,400 jobs from August to September, primarily in the restaurant and hotel industries. Consumers are starting to go out to eat a little bit more, maybe taking those not staycations but venturing out a little bit within the state, and we are picking up a lot of business from the surrounding states. The professional and business service sector was up 2,900 jobs. Manufacturing was up 900 jobs, and I thought that was a real nice indicator for us, and hopefully all of these are going to trickle down to Fayette County. Health and education industry was up about 800 jobs. Now the flip side of this is trade and utilities, which includes retailers, was down 2,900. The government sector was down about 200 jobs, and then mining and logging was down about 100. As we look at new construction permits, we're down 504 from September to October, and we're down 141 lower than October of 2009, so not a good trend there. Positive news that business licenses were up 36 month over month, but unfortunately we're 72 lower than October of last year. I think the more bleak aspect of the indicators that I'm going to be sharing with you today is home sales are down. I don't think that's new to anyone, but what struck me, we're down about 23 month over month, but what struck me is we're down 322 over October of last year, and you might recall that there was all of the various stimulus packages that have been in play that have really stimulated home sales, but now that those have all sunsetted, we're back to some fairly dismal numbers here, and hopefully those will be picking up with the $600 billion being pumped into the economy and rates being kept low. And then finally foreclosures were actually down eight month over month, and we were 15 fewer than October of last year. However, the master commissioner has indicated that we still have a bottleneck in foreclosures, so we have not seen the full brunt of foreclosures. Any questions on that? No questions, but I will add that the U.S. Treasury Department just released through October new home starts this year residential are 519,000 year to date. In 2005 it was 2.07 million, so only 25% to date this year nationally. That's a pretty strong indicator of what we're seeing up here too. And fortunately Fayette County has been somewhat insulated, so we're not the Las Vegas of the world where there aren't any new home starts. And with that, Chair, I'm going to ask Director O'Meara to come up and talk revenue. Thank you, Commissioner. We have the October actual results for the four largest revenue streams, and at first glance it's very appealing. Usually when things look too good to be true, we try to dig a little deeper and find out if they truly are, and in this case that's why we have the footnote there. For October of 2010, the four major categories added up to $11,935,000 against a budget of $10,168,000 for a positive variance of 1.7 million or up 17.4%. If you go from bottom to top on the variances, the franchise fee variance is still negative but only slight, so we're starting to see that compression between actual and budget in the franchise category. The insurance is still trending positive. You might remember or not, last month we had some very strong insurance numbers, and we questioned them because they looked too strong. We contacted those companies, and they insist those dollars are ours. We asked once, we put it in the bank, we're going to count it as ours. So we do feel we're trending ahead in the insurance category. Net profit is still below budget, in this case $323,000 or 25.6%. And the light is the 1.75 million positive variance in the employee withholdings. When we tried to peel the onion there, we found that there is a major employer who usually pays us in November and historically has their payment in November, who paid us early to the tune of $1,733,590. So if you take that early payment out, then actual to budget variance is $17,300 or 0.3%, and it suppresses the total variance for the month for all four categories to up 0.3% instead of 17.4%. So that timing difference will wash out next month. I'm ready to go to the next slide. I was just curious, since the employee withholding is for payroll. That's correct. And the payroll hadn't been paid, and I think the employee pays the tax, not the employer. I just thought that was a curious thing. Did they give you any more detail on what they were doing or whatever? Well, yes and no. First of all, let me clarify. The employee withholding is paid for by the employee, but it is the employer's responsibility to administrate that. They withhold it from the paycheck and then remit that on behalf of the employees to LFUCG. That payment, because it's of end of quarter, is due the last day of October. And usually they cut the check on the last day of October, and it is recorded November 1st, 2nd, 3rd. This time they just cut the check a couple of days early. All right. That answers it. So basically it was for the October month. They just paid it right at the end of the month and it didn't roll over until November. Right. Thank you. That clarifies that. If we look at October year to date, the four major categories for October year to date are 63,467,000, and that's compared to a budget of 60,116,000 or a favorable variance of 3.3 million. If you make that same adjustment for the timing difference, instead of employee withholding's variance of a positive 5.8%, it would come in at 1.8%. And the total variance, we would still be positive, but it cuts it in half. And so we would be trending ahead by 2.7%. Would like to take just a moment and look at this. The numbers are disappointing in that the state shows about a 4% increase in their employee individual returns. And corporate returns are up 67.8%. Limited liability corporation, which is a tax we don't have, is up 35%. And that tracks with what the economists had predicted. They said that before payroll goes up, that the profitability, which is the basis for the net profit, would go up and we would see a rise in our net profit revenue before we saw a rise in our withholding revenue. That prediction seems to hold true for state revenues. They're not apples to apples. Their tax base is different. But still, we would have expected somewhat of the same trend. Instead, we're slightly ahead in the withholdings, and it doesn't look like we've hit bottom yet with the decrease in net profit earnings. Council Member Lane. Question. Because we have the lowest unemployment rate in the state, it would seem that maybe we're going to have a harder time having a bigger increase because our unemployment rate was so low compared to the rest of the state. Do you think that could be a factor in why our numbers didn't go up as fast? It could be. However, I was still hoping this trend because our employment is higher than it was year over year. So since more people are employed now than a year ago, we were hoping that that profitability in the margins or profits of the corporations would start to show through. Yes, sir. If you want to jump on there, Council Member Beard. I couldn't catch you. He started staring at me before I had my hand up. I don't understand this electronic. Anyway, the types of jobs that have been added are lower paid than probably the jobs that we lost, I would guess. I don't have that. Commissioner Rumpke went over that strata for the state. We don't have that at the county level. But one would expect that service industry jobs would be the ones first to rebound rather than professional, which are the higher paying. As the article in the newspaper earlier this week shows that our manufacturing base is smaller in Fayette County as a percent of the total than statewide. So there are those factors that definitely play into it. Well, the next one I guess I would, well, excuse me. First I wanted to say with all the caveats about it's not as good as it seems, this is the amount of money we have in the bank. So not to distract from the fact that these are collections and these are funds that we do have. But to start to look at more an economic look, we've been each month showing you the year to date with the amnesty dollars backed out so we could look more at what recurring revenue streams would be. And so we have a favorable variance in the employee withholdings after adjusting for the amnesty of 2.1 million. But if you take out that advance payment, it drops to 405,000. So instead of up 5.01 percent, it would be a 1 percent gain. And then the total for the four would be 322,000 rather than 2 million, which would relate to a half a percent gain. So I guess the theme that I think this shows us is our revenues are flat. We are not exceeding budget enough to show a lot of wind in the sails yet. Before we go on, I think it's important a lot of people have asked why we keep showing the slide when what you said previously that we have that money in the bank. So it's not like we don't have it. Well, the important thing is to look at reoccurring versus non-reoccurring. And the amnesty is a non-reoccurring revenue. So those people watching at home, that's why we include this slide. I think it gives a better indication. Thank you, Chair. Thank you. The other two slides are, again, looking at the economic trend. Since withholding and net profits are the key indicators, we have been tracking not by budget but comparing to last year's actual for the calendar year. So for the 10 months ending, if you smooth out the amnesty dollars as well as this timing difference, we're 1.2 percent ahead calendar year to date over the same period 10 months of last year for withholdings. Again, our budget was a .9 percent, I believe, increase. So we're about tracking with budget with this economic trend. The net profit is where my blood pressure goes up. The same comparison of the 10 months ending of October for calendar year 10 compared to the same period last year has our net profits down basically 10 percent year over year. And last year's net profits were lower than the year before. So we're still trying to find that bottom before the rebound starts to show up in our net profit revenue line. I will say that we are blessed in having some strong sectors, as Council Member Beard was talking about. Our government sector is up 2.8 percent. Our health care is up 5.4. Manufacturing is slightly up, but the retail service sector is down 3.4 percent. And that's looking at just Fayette County results. I do look at some results from what appear to be some bellwether businesses. Kind of as they go, kind of so does Lexington go, and they are both lower this year than last year. So there's still room for us to rebound out of this. It's a matter of does it happen at Christmas, next summer, is it tomorrow? We're trying to see when that time would be. And if I could predict that, I guess I would be retired and living on my investments. So any questions for those parts? Council Member Martin and Vice Mayor Gray. Thank you, Chair. In the last three major recessions that we've had, how many years of declining profits has, because I remember we talked about this a year ago, July, when we were looking at the budget. And I think that they've been three or four years declining, haven't they? I don't have a third recession. I have two recessions. And withholdings showed a decline from one year and then a small increment the year after. So we had one year of down revenues and withholdings. In net profits, we had two years of down revenues before we started to plow forward. Right now, we have two flat years, basically. The 2009 over 2008 was .3 percent, basically flat. Last 10 over 9 was a negative half a percent, so virtually flat. So we've had two years of flat. The question is, is this a turnaround year? For net profits, we've had a 2.2 percent decline, 2009 over 2008, and a 10.3 percent decline, 2010 over 2009. And as you can see, that's reflected in our calendar 10 months down 10 percent. So if the past is a predictor, we should pull out of it before this fiscal year is over. I'm just not sure that this recession will emulate the ones before. Thank you, Chair. Vice Mayor Gray. You just answered it, Bill. You said that decline in net profits between 2008 and 2009 was about 2 percent? 2 percent the first year, an additional 10 percent last year. Right. So 8 to 9 was down 2, 9 to 10 is down 9.9 or 10 percent, right? Correct. What happened? So I think Councilman Martin's question was one that could provide some insight. I know maybe it's in some of these future charts, but you sometimes have shown us troughs before in the recessions. I don't have it today, but I can bring that back to you. But to give you some comparative numbers for net profit, from 2003 was, excuse me, 2002 was 8.3 percent less than 2001, and then 2003 was another 2 percent less than 2002. So we lost 8 percent and then another 2 percent. This year, this time it's reversed. We lost 2 and then we lost 10. So it seemed to have gained momentum instead of slowed down. And then it rebounded in 2004? It did. That's when we did the amnesty, so we actually collected 23 percent over the prior year, but that has a spike of 2.9 million in it. But the amazing thing was the following year went up 7 percent and then 10 percent and then 11 percent, and those were pretty giddy years. Anyone else have any questions for Mr. O'Mara? Do you have the relative expenditures, though, during those years as compared to today? How much money were we spending back then and what are we spending today? I'm the revenue guy. There's a big difference, so it's all relative. There were, I can from memory say that there were surpluses. I just remember in 2005 our budget was $258 million expenditures. Continue. All right. I'll turn it over to Director of Budgeting, Ryan Barrow. Well, Bill was able to cover the large impacts to revenue. Transferring over to more of the larger picture, as you can see the total revenue, Bill had talked about $3.3 million up with the caveats of early payments and tax amnesty. But when we factor in our other revenue streams, intergovernmental and some other things, it actually puts us up to about $4.8 million. Most of those, again, are due to timing differences as well. So with a budget of roughly $69 million, $74 million in revenue, we have about a $5 million favorable variance on revenue. Now I'd like to transfer into the expense side. I really just want to walk through the first two with a lot of attention on the personnel expenses. As a result of some of the health care discussions we've had recently, we were able to do part one of the solution. We worked with accounting to put in the actual expense that was due to the general fund. Remember, the numbers we were talking about previously were all funds. So the personnel expense, 85.6 that you see there, actually includes the additional. It came out to about $2.2 million, again, through the first four months of the year. The number I do want to caveat and say will change is the budget number. This is the old budget number through the first four months of the year. Assuming we did health care like we did in previous years, where at the end of the year we expensed all the liability in that fund, that number will change. So in terms of the actual, the 58.6 is strong. The budget favorable variance, that is non-material at this time. It will change. We did part one of the solution. And now since we changed the methodology in how we account for the expenses, we need to change the methodology in how we account for that budget number. The operating expense, this is one that does surprise me, but we do have roughly $2.5 million to the positive. Now, again, nothing's changed on that. All that money is still available, and due to timing, all of it could still be spent. And even though there's a favorable variance through what we're reporting through today, again, it could all be spent. But I think through some very proactive energy that's come from the Commissioner of Finance on cash management, I think that that is at least in part a result of why we're $2 million to the favorable in operating expense. And really a remainder, again, debt service and partner agencies and the insurance, the small variances that we do see there are really a result of timing. So bottom line in terms of our year-to-date actuals, we roughly have a net income of about $6.8 million. Although we're positive to our budget variance, again, with the caveat the personnel expense number will change, probably for the good, but we are roughly running net income through the first four months of the year of 6.8. And that's kind of what we wanted to focus in on today. Since we have more accurate financials, again, we're progressing to true closed monthly financials, we wanted to kind of walk through that 6.8. So we've looked at it two different ways. What if we sell the property? What if we don't sell the property? Again, that's a big impact. That's $4 million roughly. So in terms of that $6.8 million, well, actually, let me start with our original budget. We've talked about our original budget all throughout the year and kind of give you a frame of reference for the 6.8 we're talking about here. In terms of our annual net income, we projected roughly $6.8 million to be negative at the end of the year, funded by cash. Two sources are checking in our savings account, our general fund and our economic contingency reserve. So roughly we had a budget of about $4.8 million coming out of the general fund, our checking account, and we had about 5.8, as we talked in length about, coming out of our savings account, the economic contingency reserve fund. So starting with that frame of reference, I'd like to then just talk about where we are now. The 6.8 is clearly favorable to what our budget is, but the beginning fund balance, we have not realized the roughly $2.7 million state Medicare reimbursement, but we have picked up some other funds. Again, this is draft. Until the accountants release the actual number, this has got draft on it. So roughly we would have 3.2 in the general fund balance where we originally were budgeting the 4.8. So as of, if we close the books at the end of November 1st, if we close the books, we would have had to draw 3.6 out of our economic contingency fund. Transfer that analysis over to if we don't sell the property. So clearly we can start with the same 6.8 million. That $4 million is a revenue source. So more or less we deduct that from, so we have $4 million less in revenue. So our new point of reference would be the 10.8 million in the whole through the first four months. We would have, again, that $3.2 million in our general fund that we could apply towards that deficiency. We would be forced to, again, you can't close the books with a negative there, so we would be forced to draw funds out of our economic contingency reserve. I understand this is a lot of information, so I'd love to go over questions. Got several too. Council Member Beard, before we start, can you reiterate what you said about the Medicare reimbursement you just mentioned? Beginning of the year, Medicaid. I'm sorry, Medicaid reimbursement and why we haven't received any, if we will. Yeah, the beginning of the year we've used the term our general fund had roughly $4.7 million. I think it's on page 12 in your budget and brief. That $4.7 million was not necessarily cash in the bank. It was based on what funds that were booked in the system, of which $2.7 million, is it Medicaid, was in that fund balance. And at that point I'm going to turn it over. Sorry. Just briefly. Just very briefly. Before we add on that. The way that this is being treated, because it wasn't collected and wasn't a guaranteed receivable as of the end of the fiscal year, it was not included in the carry forward balance for FY11. Commissioner Helm is working on that collection as we speak, but the physical accounting treatment did not allow us to include it in the fund balance carry forward, which was originally how it was represented in the budget. And the reason that was the case is the state could not give us the date certain that that would be paid, and therefore to book a receivable without a date certain, there were accounting practices that said. Do we have any idea when we will receive it? That's what she's working on right now. So it's up in the air. Yeah. Thank you. Thank you, Chair. A couple of questions. Actually one that probably should have been asked a little earlier. Partner agencies up $429,000. How in the world does that happen? That's one that's been surprising to me. And every time I go and look at it, it's just due to timing. I'd have to, if it's one in particular, I'd have to do some more analysis. But basically it's timing. I mean, they're not going to overspend because clearly there's defined contracts on how they're paid. I mean, we're kind of in the driver's seat. The PSAs indicate when we pay them and how we pay them and all that. And I just can't imagine how it could be $429,000. That would be interesting to dig out. Somehow somebody's released money that they shouldn't have yet. One of the things that has been of interest, again, I've focused on the larger numbers, but the methodology for that particular line item in the budget, it was spent based on how it was in 2010. So clearly something's happened since 2010 we're accounting for differently or they're submitting their invoices sooner, it's getting booked sooner. But we'll look into that for you. Okay. Thank you. The other question involves the $4 million. I asked this question in our bonding workshop of Commissioner Cole. And I think several of us, if not many of us, kind of thought that the $4 million was a pipe dream. And we're roughly five months into that pipe dream now. And I would love some comfort as to where we're going with this. The whole thing revolved around one large sale. And there's been some discussions that there's been discussions. But that's about it. And I don't know at what level, whether it's a $4 million level or whether it's a $2 million level, where the discussions are. We haven't been in those specific discussions, been in talking with Commissioner Cole. There are ongoing discussions. The appraisals have been reviewed, the appraisals of the various properties. It's difficult to talk in this forum. We can't talk specific properties, obviously. I know why. But she is having ongoing discussions, particularly on the larger properties that we're aware of, because obviously $4 million is a large number and we've got to focus not just on the smaller properties that she talked about at the bonding meeting. But I know she'd be happy to talk with you one-on-one about that. Okay. Very good. Thank you. Thank you, Chair. Councilman Martin. Thank you, Chair. I guess I'm a little concerned about the numbers because, as we all are, because just because we make a decision to sell the real estate doesn't mean, number one, we're going to be able to sell it or, number two, that we're going to be able to sell it within the six months or eight months, I guess, left in this budget cycle or seven and a half. And so given that we're in the worst residential and commercial real estate markets in recent memory, I don't think we can count on increasing our revenues through the sale of real estate in this budget year. I mean, we certainly would like to get it done, but I don't think we can count on getting it done because the markets are difficult properties sitting around for a very long time, and if we're willing to take basically a fire sale price for it for what we're selling, it could sit around for quite a while. And so I think we need to come up with some additional contingency plans about how we're going to meet that. And I'm sure Councilmember Lane can speak to that better than I can, but I think that there's going to be no guarantee that we'll get that done in this budget year. Well, and one of the responsibilities we feel that the finance team has, Councilmember Martin and I appreciate you bringing that up, knowing that we have several non-recurring revenue items within the budget and knowing what the trends on the revenue side have been thus far, and we felt it was important to try to bring a snapshot to you of exactly that. What happens if we don't sell the real estate, and what is that doing to the economic contingency draw that we may or may not have to make? Obviously our goal is to not make any, right? And so what are the other options that this leadership body have in order to either not draw at all or at least lessen that draw? If you notice at the bottom, and I think, Ryan, you had just covered this, he put down there other considerations. Obviously we hope that our health care does not project out to what Ryan had presented a couple weeks ago, but if it does, that's another consideration that's facing us. And then obviously we have some litigation settlement issues that weren't budgeted, and so I think it's important in the Budget and Finance Committee that we think about, as we make these other decisions, whether it's around bonding, whether it's just around our day-to-day cash management, that you all have the truest picture possible of the what if that we're facing to get this budget balanced for FY11. So thank you for asking that question. Council Member Gordon. Thank you, Mr. Chair. On the real estate, and, of course, I think it would be helpful for us to have some conversation, too, with Commissioner Cole about this, do you know how aggressively we're trying to market our real estate? Linda says aggressively. I mean, are we, do we have any property that we're close to having contracts on? Are we, can you give us a little bit? Can you give us a little bit of an update? I hate to speak on her behalf, and certainly I know she'd be happy to bring the details to this body. I know that there are some of the smaller properties where they're adjacent to, let's say, a homeowner or adjacent to a business, that they're pretty far along with respect to appraisals, et cetera. Are they in the contract stage? I'm sorry, I don't have that specific information, Council Member Gordon. On some of the larger properties, obviously reviewing the appraisals that we do have, getting it ready to the extent that we can have those conversations is what they have been focused on, and I know that meetings are being set to try to have those conversations on some of the larger properties. One of my main concerns is next month we'll be halfway through our fiscal year already. And to my knowledge, I realize property sales take a while, but it sounds like we haven't sold any. Is that in this $4 million projection? Not in that category. I think there might have been a few smaller properties that have exchanged hands, but again, I'm probably the wrong person to ask. I apologize. It's extremely concerning to me. In fact, I don't get nervous about very many things, but this financial analysis without sale of real estate, and I agree with Council Member Martin's comments about this is a terrible real estate market to begin with, and this financial analysis which shows economic contingency draw required, that's half of our economic contingency. That's more than we anticipated building into the budget. And that is deeply concerning to me. It has taken us many years to build up our economic contingency fund, and I realize these are, you know, this is an analysis that isn't yet come to full fruition. However, we're running out of time from my perspective on this. A couple quick comments, Council Member Gordon and Chair. Now, there has been lots of things happening in law to get the properties ready for sale, obviously, title search, that whole thing. So that process has been taking place since we adopted the budget. Again, I'm sure Commissioner Cole will be happy to provide an update. Ryan just showed me we've sold about $42,000 in change thus far that has physically closed and is on our books year to date. Since July 1st. Since July 1st, yes, ma'am. And what I would ask the committee and, quite frankly, the Council and the citizens to focus on is one of the reasons that we put this slide in place, whether it's real estate or whether it's some of these other considerations, we're really going to need to focus on that net income. And if I can just go back one slide, we're going to have to focus on those expense items, knowing that we have this facing us, and so as we're trying to give a more global picture, you know, what impact does bonding have on that? What impact does, you know, various timing of expenses have? And we think that that's our responsibility to bring that forward because, to your point, at the end of the day, at any given time, if we closed our books today, we would have to draw $7.6 million because we haven't sold $4 million. And that's what we want to keep in front of this leadership body so that as we're making decisions around these other items, that you have that holistic picture. And I think Councilmember Ellinger had asked that question a few months ago, and we thought, you know, this is something that we need to account for every month. So, Chair, I know we changed it up on you a little bit, but we thought that this was critical to get in front. Well, and, Mr. Chair, I would simply ask that you and Commissioner Rumpke facilitate a report from Commissioner Cole, ASAP. And I'll be happy to take care of that right after this meeting. Yes, if we could do it at our next work session. Sure. I think that's December 7th. Two weeks from today. Yes, since we don't meet next week. I'll be happy to. Unless she has it today, we can go into closed session today and talk about it. I don't know if she does. I don't want to do that to her and not know. I don't know. To the extent that we could, we will. But if we can advise the whole Council, I think it would be appropriate, to Councilmember Gordon's point. I think so, too. Thank you. Thank you. Thank you. Councilmember Martin. Thank you, Chair. I remember last budget year we spent a lot of time sort of on a month-to-month basis talking about how are we going to plan for our shortfall. And I remember Mr. O'Mara and I having a number of conversations each month about where we were and how we were going to plan for it. And to date, I'm just not aware of what the plans are to try to address this. Because I think we have, I think we need to start sort of getting things in place now. Because you've got to get a running start, as you all know, to put anything in place. And so perhaps at the next earliest opportunity, you guys can at least bring me up to speed on, you know, what's our game plan going to be. Because I think we're going to have to do something. Well, and Director Barrow mentioned it during his presentation. Please understand that on a daily basis, we're very aggressively managing our cash flow, which obviously is critical to the day-to-day operations. But we're, you know, following contracts. You know, if it says you pay on the 30th, we're paying on the 30th. We're taking advantage of discounts where it's appropriate. But just as we did previously when we did an expense reduction plan, that discipline has not changed just because we don't have a plan in place. If you noticed in the operating expenses, as Ryan pointed out, we're still managing below budget, and that's because we're trying to the best of our abilities to absolutely scrutinize every spend we're making, knowing what we're facing here. So absolutely, you know, the time is now to be rolling up our sleeves to having a more definitive plan. But that's what's been happening in the interim. Yeah, and I share Councilmember Wharton's concern about the economic contingency fund because to me that fund should be a sort of a pool of money of last sort of the last ditch effort to save us from a financial catastrophe. And I'm sure you all agree we shouldn't use it as a credit card and borrow it against and then pay it back and that kind of thing. I think we need to preserve it at all costs. And is this really the big one, I think? And, you know, and I think that I could, you know, we could all foresee something worse happening, some overwhelming catastrophic financial event where we might need that $15 million in the bank. And so because of that, you know, if humanly possible, it's to try to manage this revenue crisis without the financial contingency. And that's a difficult thing. It's going to be very tough. And so, you know, that's going to be sort of our work to do to try to figure out how to do that with you all. Obviously our challenge is that personnel is such a large percentage of our overall budget that it's hard to get there just on the operating expenses. So we've got some real challenges ahead. Anyone else have any questions or comments for Commissioner Rumpke? I will say we're not in this alone. The federal government has only finished their fiscal year, which just ended actually September 30th, five times in the last 50 years with a surplus. And this past fiscal year they spent $3.46 trillion, and that's compared to 1.79 in 2000. So they've three times their budget, and they have the same issues that we're currently having. The problem or the convenience they've got is they can print more money than we can. So our times ahead of us will be challenging. And I think we all understand the message being delivered today, but I think there's still a lot of work we can do to soften this blow. And if you'll have Commissioner Cole come on December 7th, that would be very helpful. Anything else from the committee today? We don't have the actuarial study ready yet. If we do get it in the next week or two, we can have an emergency meeting if we want to see it before we go on Christmas break, which may be appropriate on the 7th or the 9th. But until we get that actuarial study back, we won't have it to review probably until January. Chair, I just have one more announcement around that. Obviously we can't close our books until we have the actuarial studies, and we can't issue the CAFR without the actuarial studies. But we are anticipating receiving that actuarial study here in the next week, and we hope to have the CAFR issued. Our goal is to have it issued by December 17th. So just wanted to make counsel aware that that's our goal, and obviously we're working with our external auditors and the accounting team. They're doing a wonderful job to get that issued. So I'm thinking that your January meeting would have a presentation of the CAFR to the extent that the committee would be interested in that. Thank you for that update. Anything else come before the committee today? I have a motion to adjourn. Second. All in favor say aye. We're adjourned. Thank you. Thank you. Any discussion? All in favor say aye. We're adjourned. Thank you. Thank you. Another motion to adjourn. Second. All in favor say aye. We're adjourned. Thank you. Thank you. Thank you. Aye. Aye. Aye.  Aye. Aye. Thank you. We're adjourned. Okay. Thank you. Thank you. Thank you. Thank you. Nights in white satin Never reaching the end Letters I've written Never meaning to send Always missed With these eyes before Just what the truth is I can't say anymore Cause I love you Yes, I love you Oh, I love you Gazing at people Some hand in hand Just what I'm going through They can't understand Some try to tell me Thoughts they cannot defend Just what you want to be You'll be in the end And I love you Yes, I love you Oh, I love you Oh, I love you guitar solo guitar solo Nights in white satin Never reaching the end Letters I've written Never meaning to send Beauty I've always missed With these eyes before Just what the truth is I can't say anymore Cause I love you Yes, I love you Oh, I love you Oh, I love you Cause I love you Yes, I love you Oh, I love you Oh, I love you orchestra only, no vocals orchestra only, no vocals orchestra only, no vocals orchestra only, no vocals orchestra only, no vocals orchestra only, no vocals orchestra only, no vocals orchestra only, no vocals orchestra only, no vocals Hi, I'm Paul Chartier. This is Heart of Gold. We have a new beyond this evening. We've got the Child Care Council of Kentucky, Brad Stevenson, the executive director, and the director of community partners, Terry DeLuca. Hi, Paul. Welcome. Nice to be here. Thank you. Probably a lot of people have heard about child care, but not your organization. Bradley, what do you do? Well, you know, we have actually been in Lexington since 1984, and there are so many folks that don't know that we exist, and by not knowing we exist, they don't know what we do. So we provide a variety of services to parents and families that are very day-to-day needs that parents have, and we provide services to help fill those needs. So one of the services that we provide, and one that we were founded on, was that we help parents find quality child care. So a parent would call us, give us some guidelines of what they're looking for, location, cost, whether they provide transportation, those type of things. We punch that in our database and then bring back a referral list for parents. We provide the parents with that list, and then we provide them with tools to make a good choice for quality child care. We help approximately 3,000 families a year through that referral process in hopes that once we make the referral that they obviously take the information we provide them and then make a good choice for care. So that's one of the programs that we actually provide, and it's a free service to parents. Isn't child care obvious? To many, yes. And sitting at home, I'm thinking, child care is obvious. I know that there's 30 of them in Fayette County. To dive in and call you, are you sorting out cost, staff, location? What are you providing for them? It is an essential need for parents to work, to go to school, those type of daily activities that allow them to do those things. And yes, parents, a couple of things that drive what parents want are the cost of their weekly care, the location. Is it convenient for them to get from home to work, home to school? And then quality is what we try to instill in parents, is finding a place that provides good quality, safe child care for their children. But, you know, again, it's one of those things. It can be expensive for parents to pay for child care in some situations. And we'll talk about some average costs here in a little while. It can cost more for child care than it can college in some situations. Having children that have gone through that process, you pay your babysitter more than you pay child care per hour. Yeah. One of the statistics that we'll put up on the screen, a single mother in Kentucky with two infant children, child care can consume 32% of the cost of her income. And a mother that makes $20,000 a year, that's in the poverty level with two children, $6,400 of that could go for child care expenses. That is shocking. But who wouldn't do that for their children? Right, absolutely. And I know that to help get the word out about what you do, you've hired Terry DeLuca. We have. And you couldn't have hired a better person. Well, Terry and I go back a long way. She actually, I cared for her children, my wife and I did, back in the early 90s. And we developed a friendship, kept that, and she was available and we were looking. And it has worked out very well. So Terry can talk about what she does. Circle of life, we call it. And now I just found out I paid you way too much. I didn't charge you that. I paid my babysitter. As Director of Community Partners, it's my responsibility to go out into the community, attend any event, every event, and tell our story about quality child care and what the Child Care Council does. We hope to work more with employers and talk to the employees, go in and do seminars, maybe some lunch meetings with them, breakfast meetings, go in and talk about quality child care and what they're looking for so that we can assist them. You know, this really started back in 1984, the Child Care Council did, when IBM first moved here. And with the influx of people moving here with the company, they were looking for child care. And so out of that came the Child Care Council of Kentucky. And you've, in a good way, rocked the boat, made an impact, because you've not been there long. What are some of the fun things that you've done to illuminate and raise the awareness of the council? I always talk about going on Thursday nights, especially, and walking the streets of Lexington, taking in the events, especially during the World Equestrian Games, and always trying to wear my logo shirt or my name tag, talking to, going to chamber functions. Recently we had our big fundraiser for the year, our golf tournament, and that consumed a lot of time, but it was very, very successful. We are very fortunate to have Kyle Macy as our spokesperson, and he has done this for the past several years. So this was our eighth annual golf tournament. That's fantastic. And we had 256 players in the tournament, so it was awesome. When I hired Terri, she said, what do you want me to do? And I said, I want you to tell our story to as many people that you can. In any situation, any meeting, at any opportunity that you have, I want you to tell the story of what we do and how we can assist parents. And she is right. Our agency was started with a grant from Boston, and it was for families that had children working at IBM, and we helped them find care. We helped them keep care. We were the connection between employee and child care facility for several, several years. We have evolved over time to do much, much more than that, but that's the reason we were started back several years ago. What are your challenges right now? You know, obviously the economy is pretty tough, and for the parents and families that we serve that are already in an impoverished-type setting, through many of the programs that we offer, that just adds a whole layer of a different kind of challenge. There are few jobs, and the guidelines to be eligible for subsidies are not high. And so, you know, parents sometimes have to make a choice whether they work or stay home, and they balance the funds. You know, is it cheaper to stay home, or can I afford to take my child to care? There used to be a way to pay for child care pre-tax and have it lower your taxes. Does that still... Is that part of your plan when you talk to people? That's typically up to the employer that they work for. There is an earned income tax credit that parents are eligible for based on their income, and so that helps them at the end of the year on their taxes to get that earned income tax credit. But we do encourage employers to offer programs, whether it's on a slotting scale, eligibility-based, or whatever. It may just be flat for everyone in the company to offer some type of subsidy for child care, because it helps with productivity. If the person's there and their child is in a safe, comfortable setting, they're going to be more productive at work. Well, Terry, I know and I've seen you at many events in Lexington. What are you trying to accomplish? I know you've got some fun things coming up, if you want to touch on some of those. Well, we do. In fact, once this airs, it will be in the past, but we have the mayoral debate coming up, which will be in October. Because child care is such an important issue, and we want to know what the stand is between the two gems on child care and quality child care. And we want to encourage whomever may become mayor to go with our slogan, invest early, invest often. And we want to work with other companies. That's what I'm doing a lot now is talking with companies about grants, possible grants through their company to help us with room to grow projects, to grow up great. That's one company that's using that, and we're working with them. And we just have so many things that we want to do, Paul, for these families and children. It's like you just can't grasp enough, and there's not enough hours in the day, for sure, to try to touch these families that need help. And we're not talking just about Fayette County. We work in 71 counties with the Child Care Assistance Program. Now, another program I do is the Motor Vehicle Registration Program. Very important. Very important. So for everyone out there who goes and renews their motor vehicle tag, the county clerk's office should ask you, we hope they ask you, would you like to give to the Child Care Assistance Program? And we hope everyone will say yes, from a dollar to many dollars. And that all goes into a fund to allow families to have child care assistance. And, Brianna, I know you've got some more statistics, but if you had a magic wand, and we've got about four minutes left, magic wand, in a perfect world, what could be better or different in making your job more effective? Well, you know, in a perfect world, I think every child, regardless if they are whatever situation they come from, economics, culture, that every child has an opportunity to be in an early childhood setting that is enriching, that's safe. And ultimately, when they come out of that program at the age of five, getting ready to go into kindergarten, that they could transition into kindergarten ready to learn. And that would be the ultimate goal. And there are lots of initiatives going on that we're involved in, that we try to make that our primary focus. We have a great relationship with Fayette County Public Schools, and that's very good that we work with them and are able to talk about this together and kind of merge the community piece with the public school piece. It's a really good relationship that we have with them. Would you like to have us put your other beautiful chart up on the screen? That would be wonderful, and I could talk quickly about that, if you don't mind. Please. It's actually our largest program, and as Terry said earlier, we provide this service in 71 counties in Kentucky, in central, eastern, northern Kentucky. And it's the child care subsidy program that allows parents to work, go to school, and we will pay a portion, sometimes all of their child care expenses. You can see from the screen we serve 11,392 families, average a month, 19,980 children, and really the most staggering, I think, is that monthly, this is a monthly total, that there's $6.263 million paid to child care providers in those 71 counties that provide services to children on that program. So over a year's time, in those 71 counties, there's almost $75 million that the state invests in this child care subsidy program that allows parents to work and go to school. And Terry, in the last minute, to make a plea to companies, what could you say to help them open their door to you? Call me at the Child Care Council. And our number will be on the screen, 859-254-9176 or 1-800-809-7076. Give us a call, and we would be happy to have someone come out and talk to the employers and the employees about quality child care and what we can do to assist their employees. Great benefit that a company could provide. And to take all these children and get them on the right path for when they step into education, is there anything more important than that? Nothing. Bridging that gap between children coming out and being ready for school is, in my opinion, it changes so much for children and ultimately families and our community. Brother Stevenson, you have a tough job. Hiring Terry was a great move. I'm Paul Chartier. We'll be right back. Thank you. ♪ ♪ ♪ Hi, welcome back. I'm Paul Chartier. And as this airs in November, which is beginning the season of giving and appreciation, I want to show appreciation and thank our good friends at WKYT for producing this program for over six years. They've done a great job. It's all free and we appreciate it. Thank you very much. Another new organization, Comfort Keepers, Sarah Fraser, thanks for coming in. Thank you for having us. This sounds interesting. There are two good words, comfort keepers. Yes. But what you address is very serious. Yes. Tell us what that's all about. Comfort Keepers is really all about keeping people in their homes longer. We work with the family, with the person. We do interactive caregiving, which is a philosophy that we work with the person themselves to find out what they enjoyed, what they like doing, and we match a caregiver with them based on their likes, dislikes, things like that, what their needs are. And then we work with them to make sure that their needs are being met. And it can be anything from taking them grocery shopping, sitting with them, just having a good time if they enjoy scrapbooking, scrapbooking with them. So it really runs the gamut. Are these people homebound? Are they a certain age and older, or who's your demographic? It really depends. We work with a lot of seniors, but we also work with young people. I've sort of come full circle. I was a caregiver. Then I was cared for after surgery, and now I'm back with marketing. Really, we deal a lot with seniors, but there's also a good deal of people that just need help after surgery, can't get around the house, they're a fall risk, they're having trouble getting groceries, those kind of things. So for people that may or may not have families that have great needs, they can pick up the phone and call Comfort Keepers. Yes, and we're available. One thing that's nice, our phones are answered live 24-7. So no matter what time you call, our number is 859-224-1124. Again, that number is answered live 24 hours a day. We can help with coming home from the hospital. We have virtual caregiving through a system where they can push a button and it calls for help. So it really just depends on the person's need. How old is the organization? We've been in Lexington, this is actually our eighth year in October, but November, so it will be eight years, which is fantastic, and we really enjoy what we do. I don't want to put you on the spot too much. No, you're fine. How did your organization start? Well, it was really, we're part of an organization, a national organization, actually worldwide, and it's really just about a need. We see a need for seniors that need help, but really trying to keep them out of a nursing home or it's sad to see somebody go into assisted living or a nursing home too early. There is a place for that, but if it's just because they're forgetting to take medication or they just need someone to talk to, that's where we can step in and we can help early. How many people, it's not Fayette County only. No. How many counties do you serve? We serve Fayette, Jessamine, Bourbon, Franklin, I'm missing one. It'll come to you later. Yeah, we serve Georgetown, but sort of the surrounding counties as well we cover and can provide caregivers. And if we can't, we would be happy to provide you with information on somebody who could provide care. This is like a no-lose situation with you. Yeah. How many people do you care for right now in that footprint? It goes up and down just based on need and how somebody's doing, if they're in and out of the hospital or that kind of thing, but we hover right around 100 people that we're helping locally. That is amazing. Yeah, it's fantastic and it's so rewarding for both the caregivers and for the office staff to be able to help these families in need. Sarah, how far can someone go in their care? You talked about medication before. Is your staff trained to give shots? We don't give shots. We can steady a hand, but we are strictly non-medical. So if the medicine is in a daily reminder, we can give the medicine, but we can't take it out of the bottle to provide dosage. So as long as the family or the pharmacy is putting it in a packet or in the daily med reminder, we can do the medication and we can steady a hand for an insulin shot or things like that, but we don't actually do anything medical. The people that go in the homes, are they volunteers or are they employees? They are employees and everybody is bonded and insured. So it's that next level of safety when you're bringing somebody into your home. And if you're looking for somebody to take into a home, especially with a senior, we have a fantastic brochure that's called 20 Questions, and it's just 20 questions to look at when you're hiring somebody. And whether that's us or someone else, you really need to be careful with a senior in getting the care that they need. It's very interesting, and I'm trying to get to, when people are watching, how they can pick up the phone. Is it seven days a week? Is it 24 hours a day? It is. How does that work? It's 24 hours a day, seven days a week. A lot of times when people call us, it's in a crisis. And so mom has fallen, dad is not doing as well as he was. But in that case, it's 859-224-1124, and they can call us any time. We can have a caregiver there within the hour. So it's really the family, if they're struggling to meet those needs, we can do anything from a one-hour bath visit all the way up to a 24-7 live-in. So it really just depends on the need. What a great safety net for the person you're caring for. But then if he or she has a family that can't be there all the time, for peace of mind that you're trained, professionals are doing a good job. Yes, absolutely. And we work very closely with the family to make sure that they're getting what they need, what they want. A lot of times the senior is very capable of making decisions on their own, and we just need to step in and sort of assist, helping them make meals. They like to cook, but they're not as savvy in the kitchen as they used to be. And so we step in, help them cook, and they're still allowed to enjoy those meals. If your, you call them patients or customers? Clients. Clients. If your clients want to go to the store, go to Joseph Beth, go to Fayette Mall, does your professional drive them? Yes, we can. If they're not allowed to drive, we can take them to the mall, we can take them shopping, get their hair done, take them to doctor's appointments. Sometimes it's helpful to have an extra person at the doctor's office to take notes, to write things down, because I know when I go to the doctor, I can't remember everything that's happened. So it's helpful to the family sometimes to have that extra person there. And it's peace of mind knowing that you're going to get there, you're going to have somebody there with you while you're waiting if that wait gets long. Someone there just to be someone to help out. Absolutely. How are you funded? Is it grants or? No, we are a private company, and so we are strictly, we just do business every day, and the clients pay for our services. And, again, that really depends on what they need and sort of where they fall. How do you segregate your clients to determine what their level of payment is? It really depends on the services that they have, whether they're going with a live caregiver, with the virtual caregiving systems, those kind of things. It depends on how many hours they have. If it's a 24-7 client, it's different than if they're an hourly client. And so it really just varies, but we do a lot of different things. And so we have a client care coordinator that goes into the home and actually will speak with the family, speak with the client, talk with them about what their needs are, where they think they need to be, where we think they need to be and all of that. And she really works with them. And it's free for her to go in and talk to the family because, again, it's a peace of mind thing, making sure you have that care. Do you work with volunteers at all? We do. We do. We have people that come into the office. And right now we're actually, the 1st through the 19th of November, we're doing a food drive to benefit God's Pantry. Great. And we're focused on senior hunger and senior malnutrition. It's a huge problem with the senior population. And so we're trying to bring focus to that and let people know that it's not simply a problem with people who are underweight, but somebody who's overweight can actually be severely malnourished. And so it's sort of a hidden thing. And I'm going to ask, how does that happen? Well, there's lots of different factors. There's the physical. Maybe they're not as agile as they used to be. Maybe they're a fall risk now and so they don't like to cook anymore and they don't like the frozen meals or something like that. And so there's that physical component. There's an emotional component. Maybe they're depressed or anxious. And there's some exceptions. They don't really feel like eating. And so that can be a problem. But it really depends on the person. And then there's the social aspect. If you're used to going out to eat all the time and all of a sudden you can't go out to eat anymore or as much as you used to, or maybe you had a spouse that every night you sat down and ate dinner together and now that spouse is gone, dinner's not fun. And so maybe it's having someone visit during mealtime that makes that acceptable again and them able to eat and so they don't turn to the snack foods that are really not healthy. Don't we all know that. Yeah. For the 100 people that you serve, you do a great job with them. Absolutely. What's your goal or your plan to expand, do more? What do you see the future being? We really want to help as many people as we can, and it's as much about being a resource as being a caregiver for someone. So if they need help with maybe they don't know what to buy, we have literature on that. We have a senior food pyramid. We have some literature on that the USDA puts out. But just helping them know and helping them to live their life like they want to live. They've lived a long time, and they know how they want to live and what are the things they'd like to do, and so we just want to be there to help them do that as long as they can. And for someone that has gone through the process on both ends, do you hear stories from other people that are receiving your services, and what do they say? Oh, absolutely. We hear stories all the time, and it really is.