Palm Desert City Council - Study Session, May 14, 2026

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[00:03:01] Mayor: The Palm Desert City Council study session for Thursday, May 14th, 2026. Welcome, everyone. Looking for item 2A, a presentation on proposed fiscal year 26/27 financial plan and 10-year capital improvement program. Staff presentation, that's what we're looking...
[00:03:22] Chris: I'll kick it off. Mayor and City Council, today we're presenting to you the 26/27 financial plan and capital improvement program. I would describe this budget and the upcoming budget year as a year of balance. The city continues to be financially strong, but outside of Measure G, revenue growth is modest, costs continue to rise, and we have several priorities and capital projects ahead of us. At the same time, this budget preserves our high-quality service levels, advances City Council's goals, and continues the Palm Desert momentum. I want to take a moment to thank Veronica Chavez, our finance director, the finance team, all of our directors and staff who worked collaboratively to bring this budget together for you. Today you'll see some folks presenting for the first time on budget. So, we're here to answer any questions you have. It's a rolling conversation, and I'll turn it over to Veronica.
[00:04:19] Veronica Chavez: Thank you, Chris. Good afternoon, honorable Mayor, members of City Council. Veronica Chavez, director of finance. Staff is going to be presenting the proposed FY 26/27 financial plan. As Chris mentioned, during today's study session, please bear with me as I have a cold. The study session also provides the opportunity for the public to weigh in on the 26/27 plan. This budget represents a comprehensive city-wide effort to align available resources with council goals and, as Chris said, maintain the high-quality services that the community has come to expect. Before we get into the details, please feel free to stop me or staff at any time for questions or to let us know if you need a comfort break. Staff will also pause at key points to see if there are any council questions. So, our agenda for today, tonight we will move from high-level financial picture into individual operating budgets. We'll begin with council goals, the general fund projections, discuss expenditures, cash flow reserves, the all-fund summary, staffing, organizational reallocations, our operational budgets, and the 10-year CIP. So, at the very least, total revenues are projected to be $112.6 million with total expenditures at $112.5 million, leaving a modest, as Chris mentioned, fund balance of $69,000. The margin is narrow, and it reflects the reality of the current environment. Costs are increasing, service demands continue to evolve, and major capital needs require careful planning. At the same time, this budget preserves core services, advances council's priorities, and keeps the city moving forward. People generally think that more revenue means budgeting will be easy. This year's budget was not easy, as the city continues to be deliberate, disciplined, and transparent about the trade-offs of our decision-making. That said, as Chris mentioned, the city remains fiscally stable as we work to achieve our goals. Right here you see the 2026 City Council goals. Throughout the budget process, departments were asked to evaluate the request through the lens of service delivery, community impact, operational risk, and alignment with the adopted priorities. The proposed budget supports the City Council goals, including all those listed here. And the result is not simply a spending plan; it is a policy implementation tool that connects available resources to council's direction and community outcomes we are trying to achieve. Next up, I will ask Sky Wawwicks to lead the presentation on general fund revenue projections.
[00:07:19] Sky Wawwicks: Good afternoon, Mayor, members of City Council. Sky Wawwicks, management analyst in the finance department. As we turn to review revenues for fiscal year 25/26, we adopted a budget at 109.7 million, and we currently are anticipating ending this fiscal year's budget at approximately 112. This increase is primarily due to receiving a full year's district tax revenue. As previously discussed, revenue growth is continuing to normalize, and for fiscal year 26/27, staff is projecting relatively flat growth with the general fund revenues estimated at 112.6 million. On the next slide, we will take a deeper dive into the key drivers that are behind the 112.6 million projection. The city's three top revenue sources are district tax, sales tax, and transient occupancy tax, which also includes short-term rentals. District tax is currently projected at 27.5, sales tax at 25.2, TOT at 23.5. Property tax is the fourth largest revenue source for the city, projected at 12.4 million, with all remaining revenue categories totaling approximately 24 million. Staff has taken a measured approach to revenue assumptions and will continue to monitor performance throughout the fiscal year. And at this time, do we have any questions? There are no questions on the revenue section. We'll move on to grant funding. We'll ask Daniel Hurtado to go over the details. Grant funding remains an important tool for advancing city priorities without placing the full burden on the general fund.
[00:09:08] Council Member: I did have one quick question. Sorry, it was the previous slide about there was a reduction in rent, and I'm assuming—well, I'll ask, I don't want to assume—it was Park View being nullified?
[00:09:20] Veronica Chavez: Reduction in rent?
[00:09:22] Council Member: Rental income, rent and interest was one of the categories, about 5.2 million reduced down to about 4.8, if I remember from the previous slide. Sorry. And I just want to verify the why, and I'm assuming it's Park View, but I want to hear from you.
[00:09:34] Veronica Chavez: So, it's not Park View because that doesn't go into the general fund, but let me look into it. My computer is down right now, and I'll pull it up as soon as I get it up.
[00:09:41] Council Member: It wasn't a major number, but it was a reduction. Thanks.
[00:09:44] Veronica Chavez: It's not coming to mind. I'll get it. Daniel?
[00:09:49] Daniel Hurtado: Good afternoon, Mayor and City Council.
[00:09:54] Mayor: Go ahead, Jen.
[00:09:54] Council Member: A question. Is it the building here that we're no longer—
[00:10:00] Staff: That also goes into the Park View fund. So, just give me a few seconds and I'll look it up for you guys.
[00:10:06] Council Member: Substation.
[00:10:08] Staff: The substation also goes into Park View. Yes.
[00:10:14] Daniel Herado: All right. Good afternoon, Mayor, members of the City Council. Daniel Herado, Public Safety Coordinator. The table provided reflects current grant awards, pending applications, and major funding opportunities that city staff has pursued or is actively tracking. To date, the city has applied for approximately 39.5 million in grant funding and has been awarded approximately 12.3 million. These funds support a wide range of city priorities, including safety, housing, transportation, infrastructure, sustainability, emergency preparedness, community programs, and long-term planning efforts. Grant funding is an important tool for bringing outside revenue into Palm Desert. However, it is important to note that the city will not receive every grant it applies for. Many programs are highly competitive, have limited funding, or include specific eligibility requirements. When an application is not awarded, staff uses that experience to improve future applications, strengthen project readiness, and better align future requests with grantor priorities. This is one of the key reasons that the city adopted a formal grant policy and tracking process last year during December. A major highlight continues to be the city's federal funding efforts. Federal earmarks, now commonly referred to as community project funding in the House and congressionally directed spending in the Senate, represent a significant opportunity for large-scale projects that may otherwise be difficult to fund through local resources alone. These requests require strong project justification, clear community benefit, city council support, staff coordination, and continued advocacy at the federal level. Those will be listed on the second table below starting with the SS4 at the federal—I'm sorry, at the Portola interchange, library, veterans resource center, and so forth right there in that area. These federal requests have focused on major infrastructure improvements, public safety needs, emergency resilience planning, resource centers, and projects that will benefit Palm Desert and the surrounding region. City staff will continue to research and evaluate grant opportunities that are feasible, competitive, and aligned with the city council goals. The city's goal is to pursue grants that make sense for Palm Desert, support long-term community needs, and help leverage outside funding for projects that improve the quality of life for residents, businesses, and visitors. And that'll conclude my portion. And I'd just like to say that it is not myself. It is a team effort. It's all of the city council as well as city staff. So, thank you, and I'm here to answer any questions.
[00:12:46] Council Member: My question is regarding joint applications. I know there's a lot of things that are collaboratively done through CVAG, but for example, things like CERT where it goes through the three different cities, do any of these grant applications collaborate to share either resources or best practices with another local city?
[00:13:10] Daniel Herado: The only grant that comes to mind would be the Department of Homeland Security, the EMPG, or Emergency Management Performance Grants. That would be utilized for CERT or for any of our products for that. That would be an application. I know this year the county did it a lot lower than it usually has been in the past. Historically, the city was able to get almost close to 20 grand, or 20,000, I'm sorry. And this year, it's been dropped down to almost 5,000 where it's not really feasible to apply for. But I mean, moving forward, that would be a good opportunity to apply for as the three cities receiving one grant and hopefully increase our amount on those ends. But there are some that do have those partnership opportunities.
[00:13:47] Council Member: All right. Thank you so much.
[00:13:52] Council Member: This is kind of just a general question about trends and things like that over time preceding this budget. Has it been your experience that a larger portion or smaller portion of our budget, or any city's budget in California, comes more and more from grants and less and less that are in-house or sustaining?
[00:14:15] Staff: Yeah, that's actually something that I keep a close eye on. Post-redevelopment, we are definitely seeing an increase in grant applications for the City of Palm Desert and just the cities in general. Prior to dissolution, the redevelopment agency acted as the capital projects arm, and so there wasn't a need as much to go after those funds, and oftentimes Palm Desert didn't qualify for different grants. A lot of those requirements have been opened up recently, in fact, and so we do qualify for a lot of them. And just to go back, Mayor, to your prior question, I'm so sorry I'm out of pocket without my security blanket. The decrease is actually not in rents. We combine interest with rents on this sheet, and interest rates have decreased since last fiscal year. So that's what you're seeing there.
[00:15:07] Staff: Okay. Thank you, Danielle. If there are no other questions, we'll move on to the next slide, which comes back to me. The central theme of our budget, as Chris mentioned earlier, is balance: balance of our current operations with future capital needs, community expectations with our available resources, and progress on major projects with protection of the city's long-term financial position. One of the most important parts of this year's budget story is the work it took to get here. Initial department requests exceeded initial available resources by approximately $13 million. That gap reflected real pressures: rising operating costs, evolving service needs, major initiatives under consideration, and continued demand on the general fund. Through collaboration between departments and the budget team, staff reviewed and refined requests, re-evaluated revenue assumptions, separated recurring costs from one-time needs, and reviewed expenditure trends and aligned requests with council priorities. Budgets are developed between February and March of each year, and any updated revenue information that was received post-February/March, staff was able to improve our revenue projections by receipt of those actuals, and so we made adjustments of approximately $6 million across all revenue sources. One of the largest ones that contributed to that is the district tax. That is such a new revenue resource for us to project off of. It has been challenging. We are still continuing to see—our sales tax consultant is now initiating audits, and so even this year is one that I don't know we can count on completely for projections. Next year will actually be a full year of receipts, so we'll have a solid number then. And what that did, by making those adjustments, it brought us down to about $6.9 million that was needed, or 5.8%. To do this, the budget team reviewed five-year actual trends and worked with departments to rightsize their requests based on realistic spending. This was not simply an accounting exercise. It was a city-wide prioritization effort, and departments worked thoughtfully and collaboratively to bring forward a budget that is realistic, responsible, and service-focused. This slide is just to show you what we looked at as far as the trends go. So, we went back 5 years and included '25-'26 where it stood, made some projections, and when you looked at those 5-year trends, these were the percentage of budgets that were actually used on the average over those five years. And so, we took those trends and applied them to the requests and reduced requests by those amounts. Once we did that, we went back and talked to staff and said, 'Where do you have one-time expenditures that absolutely must be included to achieve council's goals?' We made those adjustments, and that's where we were able to balance by taking all those things into consideration. So with that, we'll move on to the general fund expenditures. As you can see, the prior year was 109.4 in our expenditures, and now we're at 112.5. It seems like a major jump, but when you look at the cost of everything increasing, it is right in alignment with that. Police services remains the largest single general fund operating expense with a proposed budget of approximately $30.4 million. Transfers are 27.2 million, which includes our transfers pursuant to Measure G, the 5-year spending plan, and support for services like fire, the library, aquatic facility, and other city priorities. Not every cost increase is driven by new programming. Many of the increases reflect public safety contracts, insurance premium increases, technology, maintenance—all the normal operating costs that we have on an annual basis. When you look at the five-year comparisons, we have budget versus actual. They're typically right in alignment. And when you compare '25-'26 to '26-'27, we're pretty close to where we were at last year. This slide here is just a reminder of Measure G in the spending plan. So in our Measure G documents, we said year three we would allocate—we were estimating 25.8 million. Our current analysis shows that we're expecting 27.5. Much like a bond issuance, we always say we have—we include the kitchen sink. So, we always have more projects than the funding that we have. So,
[00:20:00] Staff: That's where you get the $40.5 million in total plan costs. And we took what we actually anticipate receiving and spread that across priority one and priority two projects and programs. And so that's where you see the spread there. I just want to note the 10.9 million that we said we would allocate to new fire services was intended for Station 102 operations. It's not an actual decrease in operational costs. It's the timing of the truck coming online, and so we reduced it for that amount.
[00:20:34] Mayor: There are no questions. We'll move on.
[00:20:37] Councilmember 1: I have a question.
[00:20:38] Mayor: Yes.
[00:20:38] Councilmember 1: Going back to right-sizing the budget requests.
[00:20:41] Staff: Yes.
[00:20:43] Councilmember 1: Had you done that strategy before of looking at the actual used budget and then comparing that to the asks, or is this a new strategy?
[00:20:54] Staff: So we've actually looked at trends for the last few years now that we're able to pull them from our reports. Applying them to the requests we haven't done before because there hasn't been such a substantial gap. And so this year, with such a big gap, it was like, where do you start? And this seemed like the most reasonable approach to make it realistic, and then after that, going back and saying, 'Okay, does this still work for you, and where do we need to add stuff back?'
[00:21:22] Councilmember 1: I asked because I think it's really clever.
[00:21:24] Staff: Thank you.
[00:21:25] Councilmember 1: Yeah, especially looking at something like—I don't know what is involved in community safety, but they're using a third every year for the last five years. So Warren's questions, are you asking for something necessary?
[00:21:39] Councilmember 1: I was just curious. Good job.
[00:21:40] Staff: Thank you.
[00:21:42] Councilmember 1: And on that same chart,
[00:21:45] Councilmember 1: so it looks like almost across the board everybody's come in under budget, under anticipated budget,
[00:21:49] Councilmember 1: right?
[00:21:50] Staff: Over the past five years.
[00:21:50] Councilmember 1: Over the past five years. But then if you go to this one,
[00:21:54] Councilmember 1: you know, and the budgeted expenditures are green, are typically exceeded by the actual expenditures. So, how does that math work out if most departments have come in well under budget every year, yet overall?
[00:22:12] Councilmember 1: Oh, transfers out, huh? All right. Well, it's transfers out. That's what's driving that number to exceed. Okay, great. That's got it.
[00:22:26] Councilmember 1: I remember that we discussed having a policy of letting departments kind of roll some funding over without the pressure of hitting that max for 'use it or lose it.' Do you have any sense in your magic crystal ball how that may impact in terms of keeping it balanced versus fluctuating? Would any of that change, or how do you see that unfolding?
[00:22:49] Staff: So that would impact '25-'26, and our projections at the—I think we said 112 total for '25-'26, or 111.11 total—considers that we are going to be carrying over some small balances. We just opened the request period up this week, and so I don't have hard numbers yet, but we are anticipating a portion of those being carried over.
[00:23:14] Staff: You're welcome. Any other questions?
[00:23:17] Councilmember 2: So what is the driving force causing transfers out to exceed on average over the course of five years?
[00:23:27] Staff: So, the major thing in the last two years is Measure G. So the increase of Measure G to our resources creates additional transfers out that have to go to the other funds. Any sort of fire or something that's paid out of capital projects is immediately transferred at the beginning of the year to cover those costs. Whereas in prior years when we didn't have that, it would sit in the general fund and not be allocated. So it's allocated immediately upon approval. So it's the timing of expenditures versus what we say we're going to spend Measure G on.
[00:24:13] Councilmember 2: Guess it's almost like a condition of having passed Measure G is that once that money is available, it has to be allocated to—
[00:24:20] Councilmember 2: or whatever.
[00:24:21] Staff: It actually is a Council call. If they don't want it to be allocated—we said we were going to spend the money on this, and I didn't want to leave it in the general fund if that was what we said we were going to do. So we transfer it out immediately, and it's there for those purposes that it was intended for.
[00:24:39] Councilmember 2: So basically, it's honoring our commitments.
[00:24:40] Staff: Correct.
[00:24:41] Councilmember 2: Got it. Thank you. Thank you.
[00:24:48] Staff: Okay. Are we done here? Were there any other questions on Measure G?
[00:24:54] Staff: So, we'll jump right into the fun part and the cash flow analysis. Um, so for '25-'26, if you go to the very bottom of this page, we're estimating about $120 million in fund balance after everything's said and done. This is our best guess at this moment. We usually end up pretty close to where we're estimating. So, I feel pretty confident in that. If you go into '26-'27, you see our 112.6 in revenues at the top. And then about halfway down the page, you can see total General Fund expenditures at 112.5. And that leaves us the 69,000 that would be added to the General Fund balance. The area below there are our CIP priorities that we have said would impact the General Fund. So there is no other secured revenue source to cover those. And so those have a transfer from Measure G into them. The net impact is that 'request from General Fund' line that you see close—second from the bottom. So for '26-'27, it anticipates that we're going to need 1.8 from the General Fund reserve to cover the projects that we have planned in '26-'27. Because this is a cash flow view of things, they're broken up by year to the best of our ability. Currently, staff is continuing to work with capital projects to refine the cash flow so that we can present this in a more realistic manner. But that's where we're at today. You can see each year moving out with the addition of Dave Irwin Park construction, fully funded by General Fund dollars, the impact that it has on the General Fund. And again, we do have money coming in from Measure G to support that, but not in its entirety. When you get out to year 10, 2034-35, our fund balance goes down to 79.6. My glasses are blurry—79.6. That is well within our reserve requirement, but it is lower than what we've seen in the most recent years. I do want to note, about middle of the page where it says 'CIP related transfers in' those last three years, you see that there's not much listed, and on some years there's nothing. Those are the transfers that we anticipate from Measure G, but the operational costs for public safety are such that they exceed Measure G revenue at that point just based on the projections. And so we do not have funds to transfer from Measure G in those latter years to projects. And I just wanted to make that note so that you could understand why those are empty.
[00:27:46] Councilmember 3: I have a question/statement. So, I assume our budget doesn't include future revenue sources such as the Desert Surf Resort that's hopefully going to open by July 4th.
[00:27:57] Staff: It doesn't.
[00:27:58] Councilmember 3: Yeah, it doesn't.
[00:27:59] Councilmember 3: And you know, the arena as they expand and bring more opportunities for big events, a potential hotel being built near the Desert Surf Resort. All of those can hopefully add to the future revenue.
[00:28:14] Staff: Correct. Correct.
[00:28:16] Councilmember 3: And but you need a full year in order to factor that income in, or how does that work?
[00:28:22] Staff: No, what we generally base our projections off of is a 10-year trend so that we can see that curve that usually comes with the economy and how it changes. And so what you see here are projections based on a 10-year look back at each type of revenue source. So, it's not going to be a year. It'll probably smooth out over, you know, the 10 years, but it'll have an incremental change each year. To the extent possible, I've loaded in where we think we're going to be built out so that I'm maximizing the growth now and then having it dwindle off later. But it's mostly just the known things that I can use in projections. So, I wouldn't include Desert Surf or the Arena or anything like that. I'll just pray for it.
[00:29:10] Councilmember 3: Um, I see the buildout price for Irwin Park is estimated at 39 million.
[00:29:15] Staff: That was the most recent number that I had, and I believe you will have a study session on that in two weeks.
[00:29:21] Councilmember 3: Okay. Because through, you know, watching the process at Parks and Rec, you know, I think we started maybe mid-20s, 24 million, 25 million. So, this is almost like worst-case scenario.
[00:29:31] Councilmember 3: Yep, would be 39, but there's some maybe room to work with that, right?
[00:29:37] Staff: Yes. Yeah.
[00:29:38] Staff: Yeah. I definitely try to load all projects in worst-case scenario just so you guys have a full picture.
[00:29:46] Staff: Any other questions on this slide?
[00:29:50] Staff: Okay, this next slide is just the snapshot of our reserve as a result of the cash flow that you just saw. Again, you can see at the 10th year that
[00:30:00] Veronica: We are well within the 75.7 million that's required to be reserved and well above the 35% reserve floor that you guys established back in January. There's about a $32 million gap between what we're anticipating and that floor. So, there is that movement, but that's a policy decision at that time. Any questions here? Okay. Uh, next up we will have Austin come and talk to you about the all funds summary.
[00:30:38] Austin: Good afternoon, Mayor, council members. The slide before you is a summary of the all funds for the proposed 26/27 fiscal year budget showing total citywide revenues and expenses across all funds. The budget continues to prioritize major capital investments and infrastructure improvements reflected in the capital projects funds activity and plan transfers supporting the CIP delivery citywide, and is well positioned to maintain a strong financial position at year end.
[00:31:10] Austin: Moving on to the next slide. Shown here is the city's 10-year capital improvement program spending plan, which provides a long-range view of anticipated infrastructure and facility investment needs across all major project categories. The largest planned expenditures occur in the early years of the program as current carryover projects and near-term priorities move into active construction and implementation phases, followed by a more normalized annual investment level in later years. Projected future year spending estimates were developed using historical trends in the California construction cost index over the past five years to account for anticipated inflationary impacts on construction and project delivery costs. Staff is also continuing to refine project schedules, cash flow timing, and expenditure projections to better align funding availability with actual project delivery needs. This ongoing analysis will help ensure capital funding is deployed strategically while maximizing investment earnings and maintaining adequate liquidity for future projects.
[00:32:16] Austin: Moving to the next slide. Recently, the city adopted a new capital planning and prioritization policy to create more consistency in evaluating capital projects within the 10-year CIP plan. As projects were reviewed during development of the proposed budget, staff evaluated them against these priority factors while also considering available funding capacity, project readiness, operational impacts, and overall cash flow timing. Particular emphasis was placed on projects that are already in active phases of design, permitting, or construction to ensure available funding is deployed efficiently and projects can advance without unnecessary delays. The prioritization process also helps align capital investments with broader city goals, including infrastructure reliability, public safety, service levels, sustainability, and long-term financial stability. Are there any questions on any of those? Okay, there are no questions. We'll move on to the staffing summary and ask Andreas Staley to present that piece.
[00:33:29] Andreas Staley: Lower. All right, good afternoon everyone. Andreas Staley, HR director here at the city. So wanted to briefly go over the next few slides. So as you can see for the 2026-2027 staffing summary, we are adding three additional FTEs from July of 2025. These three positions are the economic development manager and then the two street maintenance workers that are working on the weekend. These were added to assist with completion of the council goals. The economic development manager position is currently vacant and staff is re-evaluating the needs of this role to determine whether the position should remain as it's currently structured or be reallocated to better align with council priorities.
[00:34:14] Andreas Staley: Next slide. Yeah, wanted to briefly highlight our reallocation of resources for services and organizational improvement. So the city has reallocated some existing positions and created some new positions for overall service and organizational improvements. These are, as mentioned previously, the two weekend street maintenance workers to work during the weekends to strengthen our neighborhood appearances and responsiveness. To meet our city council goals, we've restructured our organization to have communications be in the city manager's office and our marketing and tourism be located in economic development. And then we have reallocated existing FTEs to support three new positions: the deputy city manager, the artificial intelligence officer, and the planning manager. These roles will help improve our efficiencies through process improvements.
[00:35:12] Council Member: Can you real quick go over again the restructuring of the personnel that you spoke of?
[00:35:18] Andreas Staley: The creation of the three different positions or the divisions?
[00:35:23] Council Member: Yeah, following that.
[00:35:26] Andreas Staley: So the division changes. Our communications is now in the city manager's office. So that's the division, and that's to improve our coordination and consistency in citywide messaging. And then our marketing and tourism is within economic development, so that way that better supports kind of the destination promotion, economic development, and then our business strategies. And so that was done in order to help those different areas and refocus appropriately, of course.
[00:36:05] Andreas Staley: All right. Next. Yeah, and then just wanted to again re-emphasize our recruitment and our retention strategy. So our recruitment and retention strategy remains the same: align hiring with city council goals and priorities in mind; invest in internal talent to foster a growth mindset and maintain accountability in a high-performance team; maintain a competitive compensation package; and then lastly, reinforce a positive and productive work environment that fosters collaboration and shows appreciation to the city team. We have found that this strategy has been successful for the city and allows us to be a premier employer here in the Coachella Valley and recruit and retain quality employees so that way we can make sure we're delivering the best services to our community and our partners. So with that, does council have any questions that I'm happy to answer?
[00:37:03] Andreas Staley: No? All right, perfect.
[00:37:06] Veronica: Thank you, Andreas. Okay, before we jump into the departments, do you have any questions on any of the preceding items? Okay, we'll move right along. At this point, I'll begin handing things off to the department directors and service leads. The slides are designed to show high-level department totals, purpose, council priority alignment, key outcomes, resource allocation, operational risks, and any budget notes. I'll note the corresponding page number from the detailed budget worksheets just so you guys can find it quickly if necessary. And as we go through these sections, the goal is to give you a clear understanding of what each department is funded to deliver, where the pressure points are, and how the proposed budget supports the city's broader goals. First up, we will hand it over to Mr. Escobido.
[00:37:53] Mr. Escobido: Thank you, Veronica. So, city manager's budget, the staff count remains the same. The two major cost differences here are insurance costs have increased citywide, so this is our portion of that cost. And the other notable change is with the reallocation of the positions. We now have the deputy city manager position within the city manager's office, who will be working on citywide priorities, council priorities, different projects. This allows us to have Veronica's talents used in a variety of ways while we go out to recruitment for a new finance director in anticipation of her retirement next year. Outside of that, there's no notable changes, but happy to answer any questions.
[00:38:39] Council Member: Have a question.
[00:38:41] Council Member: I so don't like hearing about that retirement, but I'm going to work with it. So there was the change in the communications under the city manager, and that's good. We know we're going to get accurate information when it begins there. So does that mean that the PIO position is now brought under that, or how does that work?
[00:39:08] Mr. Escobido: Yes. So the PIO function is now within the city manager's office, and what we've done is, versus it being one individual, it's a team of individuals that support the variety of communications efforts. And our methodology now is if there's an issue or topic involving law enforcement or parks, we are now having that parks person or that law enforcement person speak directly to the community on the issue, but in concert with our public information team.
[00:39:36] Council Member: Thank you.
[00:39:39] Veronica: There are no further questions. We will roll into the city clerk's section, pages slide 23 through 26, and begins on your packet page 17.
[00:39:53] Michelle Nancy: Good afternoon, mayor and council members. I am Michelle Nancy, assistant city clerk. City clerk's office provides legislative administration, records...
[00:40:01] Michelle: Management, public meetings, elections, and compliance services that support the City Council, city departments, and the public. The proposed budget is 1.48 million with eight staff members. The primary budget change is the addition of the AI officer position through a resource reallocation with no increase to the city's overall staffing total. And that ends mine.
[00:40:28] Anthony: And for City Council, the City Council provides legislative leadership, policy direction, regional representation, and public governance for the city. The budget supports the Council's role in setting priorities, allocating resources, and providing transparent decision-making for residents, businesses, and community stakeholders. And the proposed budget is $391,000 and remains relatively flat.
[00:40:54] Anthony: The legislative advocacy budget supports the city's state and federal advocacy efforts, including monitoring legislation, advancing city priorities, and pursuing funding opportunities. The proposed budget is $111,000, and includes funding for a new federal advocacy services contract to help support federal grant opportunities and congressional earmark strategies.
[00:41:18] Anthony: And for the election budget, it supports the city's election administration responsibilities for Fiscal Year 26/27. The proposed budget is $128,350, reflecting the November 2026 election for two council seats. Because elections occur every other year, costs increase in election years. And this budget also includes funding for a potential ballot measure if it becomes needed.
[00:41:45] Staff: If there are no questions for Anthony or Michelle, we will go on to Andrea for Human Resources.
[00:41:54] Andrea: All right, I'm back. So staff count remains the same. Human Resources office budget request was reduced by approximately $40,000 from the 2025/2026 budget. Though this is a minor reduction, our division continues to prioritize our strategic investment in our employees that support the effectiveness and the high-quality public service. The proposed budget supports professional development, leadership training, employee engagement, and recognition initiatives that help build our culture and help make sure that our employees are fostering that customer service that we are happy to provide. And the staffing strategy ensures the city's ability to carry out the priorities of Council by retaining talent, building internal capacity, and providing professional development and accountability. I'm available for questions if anyone has any.
[00:42:52] Staff: All right, seeing none, we'll move on to police and fire services from Richard Canon.
[00:43:00] Richard Canon: I'll go ahead and provide an overview of the police services budget for this coming fiscal year. The total budget proposed is approximately $30.4 million. One thing I wanted to point out, as you'll see in the bottom left-hand corner of the slide, the initial request from the Sheriff's Department was $32.4 million. Staff adjusted that proposed budget based upon historical spending, anticipated staffing vacancies associated with the academy and field training timelines, meaning we expect to be fully staffed, I should say, in December. So there is some cost savings there, and then as well as projected reductions in overtime costs as some of those vacant positions are being filled. Most of the time when we do budget for positions, they're always budgeted at the absolute maximum, knowing though that typically when a new deputy starts off, they are not hired at the absolute maximum, and so we adjusted the budget accordingly this year for that.
[00:43:58] Richard Canon: If we can go to the next slide, it'll go over some of the cost breakdowns. So this budget supports an overall total positions of 70, that includes 35 patrol deputies and 180 patrol hours per day. A couple of things I wanted to point out is this, of course, far exceeds the pre-COVID patrol levels of service and reflects a continued staffing growth. And just to give you an idea of what some of those numbers mean, in Fiscal Year 24/25, we had 28 patrol deputies and 144 patrol hours. Last year, that improved to 32 patrol deputies, and then this year at 35 with the 180. The budget also continues to support proactive enforcement and specialized units beyond the patrol deputies. The motorcycle enforcement team is one of those with six deputies. Just to point out, as you may recall, last year we purchased three new motorcycles. That way, it allows now for further reduced downtime when they are being serviced. In addition, from 24/25, we added two additional motor deputies. And so again, while we're increasing the patrol deputies, we've also increased other deputies. Special Enforcement Team continues with four deputies. That was an increase of one deputy over the last two years. Business District Team, four deputies. Burglary Suppression Unit, two deputies. Our SRO, our school resource officers, two deputies, also an increase of a deputy over two years. And then, of course, our community service officers with 11 positions.
[00:45:44] Richard Canon: And with these staffing and deployment enhancements, they're producing measurable operational results. I'd like to point out in 2025, and again we just received this information this week, so sorry we don't have the slide prepared for it, but in 2025, the city received approximately 45,958 calls for service, which was an increase of about 3.5% over the prior year. So despite the increased demand, our Priority 1 response times remain stable at 6.5 seconds, while our overall response times have improved significantly. So from '23, we were at 33 minutes on average. '24, it dropped down to 24.34, and then in '25, down to 22 minutes. So we're continuing to see a progression of decreases in our overall response times. Coupled with that, our major crime categories also continued to decline citywide. Crimes against persons decreased overall 12%, including a 23.8% reduction in robberies from '24 to '25. And then property crime decreased by more than 23%. Two significant reductions were a 43% reduction in burglaries and a 39% reduction in vehicle thefts.
[00:47:03] Richard Canon: And so staff believes that the continued investment that we have in public safety technology is directly contributing to these outcomes. Most notable would be the city's ALPR program. We now have 147 out of the 157 cameras up and running, with the remaining two soon to be installed. And just to give you some overall numbers of what that means: since, as of March 31st, 2026, ALPR-assisted investigations have resulted in, again these are Palm Desert numbers, 245 arrests and the recovery of nearly $1.3 million in stolen property. It should also be noted that the RSO contract budget has increased from approximately $20.4 million during those, what we'll call, reduced service periods in '22/'23 to the proposed budget of $30.4 million, representing an approximate 49% increase, or $10 million increase. And so this increase reflects the restored and expanded staffing levels, some rising operational costs, those special enforcement resources, and then continued investment in technology and supportive services.
[00:48:21] Richard Canon: And so looking ahead to this fiscal year, staff is continuing to evaluate additional technologies along with the Sheriff's Department. This includes investigative software, AI-assisted report writing, and drones as a first responder program to improve overall efficiency, enhance deployment strategies, and, more importantly, allow deputies to spend more time in the field. So overall, the proposed budget reflects the city's continued commitment to proactive policing, operational efficiency, and long-term public safety investment. Current performance data demonstrates that this increased staffing, the targeted enforcement, and technology investments are improving service delivery, maintaining strong response times, and contributing to continued reductions in crime throughout the community. And so this budget, we believe this budget positions the city to maintain high-quality public safety services while continuing to adapt to future operational and community needs. And with that, I'll be happy to answer any questions. And I know Lieutenant Turnis is also here that could provide any operational-specific questions.
[00:49:30] Council Member: Just one distinction I'd like to hear about is the difference between mileage and fuel. Mileage cost, is that just wear and tear on vehicles and things, or...
[00:49:48] Council Member: It's item, sorry, item 1920.
[00:49:50] Richard Canon: Yes.
[00:49:51] Richard Canon: Yes, that's the maintenance. Yes.
[00:49:53] Council Member: Okay. Cool.
[00:50:03] Richard: I think I'm ready for... so moving on to fire services. And so the proposed budget is approximately $29.4 million, with the largest component being fire and EMS cooperative service agreement with Riverside County Fire. This also includes the fire marshal services coming in at approximately $28 million. So, so that's the blue that you see in the graph. And so going to the next slide, showing projected revenues for next year are coming in at roughly $23.1 million compared to projected expenditures of approximately $29.4 million.
[00:50:46] Richard: And so, similar to the conversation that we just had a few slides ago, to maintain these current service levels, this budget includes an approximate $6 million transfer from the general fund to cover that cost. Staff has also prepared a five-year financial projection that includes those estimated general fund support levels as we continue to move through our budgeting process and understand where and what all the needs are for our general fund dollars. One operational component I'd like to highlight, as it reflects an increase from the prior fiscal year, is the expansion of the fire marshal services, which goes from 330 to approximately 632. We now will have this coming year both the fire marshal and then two inspectors here on staff, as opposed to them not being at City Hall.
[00:51:47] Richard: A couple of things that this has done: one, having these services in-house has consolidated plan review into a single consistent review timeframe, eliminating the prior practice of splitting the reviews between two different agencies, which at times had caused significant delays, especially in some of our larger development projects. More importantly, it provides continuity through one assigned reviewer rather than having multiple rotating reviewers. It's improved consistency, accountability, and, most importantly, customer service. This structure has also allowed the fire marshal function to be more integrated with the building official and inspection team, supporting collaboration both at the counter and in the field during inspection and project coordination meetings. And so at those times when someone would come in for a question, we don't have to now turn them away and send them up north to the county's facility. The fire marshal's right there, or one of the inspectors can come right out to the counter and assist and answer those questions. Also, inspections are now completed within approximately one to two days while allowing for greater flexibility, responsiveness, and continuity.
[00:52:56] Richard: One other thing I'd like to note, if you recall from Rosa's presentation a few weeks ago, development services is also conducting a fee analysis during this coming fiscal year, as fire plan review and inspection services are currently not included within the building permit or business licensing fees. And so whether or not at some point in time, that'll really be... we'll have those numbers for you. It'll be a policy decision at that time as far as what level you'd like to recoup for those plan review and inspection fees. And so that will come later in this coming fiscal year. But overall, this proposed budget reflects the city's continued commitment to public safety, improved operational coordination, and maintaining high-quality emergency response services for the community. And with that, I'll be happy to answer any questions. And I do know that Chief Wright is also here and can jump in at any time.
[00:53:51] Councilmember: Thank you. What is the Whitman billing services? Remind me, please.
[00:53:58] Richard: That is our ambulance. They handle our billing for ambulance.
[00:54:01] Councilmember: All right. Thank you.
[00:54:05] Councilmember: Richard, can you talk about the increase in the cooperative services agreement? Is the rise due to staffing the new fire station solely, or does that also include the new contract for the state firefighters?
[00:54:26] Richard: I believe it's both.
[00:54:27] Councilmember: It's both.
[00:54:28] Richard: It's a combination of both. Both the staffing as well as the new contract hours.
[00:54:34] Richard: And then the additional increase you see next year is with Truck 102 coming online.
[00:54:43] Councilmember: Good. You know, I was at, let's see, what was it? Oh, public safety meeting this past week. We talked about, as we always do, service calls and the breakdown of what service calls require what. And if I remember, about 80% were medical, and of course, a lot of those are... I don't know if they really require fire response, but you never know till you go, right? So we were, and then at the same time, we're talking about implementing maybe a new 911 system that may filter out some of the non-necessary calls and act as sort of a shield or filter to keep the staff at the station when it's not necessary. So is there any anticipation of how that might affect the fire budget moving forward if an effective 911 system is implemented?
[00:55:30] Richard: I may want to refer to the chief on this one, but I do know... I haven't seen any... I knew that the program with having the nurse being able to respond, because it's so new, I don't know that we have exact numbers or if there's been reductions yet in that, but I'll defer to the chief.
[00:55:49] Chief Wright: Good afternoon, everyone. Yes, so what we talked about in the Public Safety Committee was about 80% of the calls are medical emergencies in the city. The one thing I did highlight was the nurse navigation, and what that is is basically when someone calls 911, our dispatch is accredited where they basically ask them a series of questions and then they determine what is the most appropriate level of response. Is it sending a fire engine and an ambulance code three with lights and sirens for a severe emergency, or sometimes they downgrade the call and we send a fire engine and ambulance code two, which would be without lights and sirens? So, it's not driving through the city erratic for a less severe injury or something along those lines. And then the nurse navigation is a new program. We're still collecting a lot of data and stats on that. And it seems kind of on average maybe about 2% of our calls get transferred to nurse navigation. And what that is is a lot of times where people call 911, they don't necessarily need paramedics or EMTs. A lot of times they just need transport to the hospital, or maybe they need their medications, or they need behavioral health, or they just need to talk to a nurse over the phone. So there's multiple different avenues that the nurse navigation takes. It's not just kind of one clear box, but that does help that 2% of calls keeping down our call volume and not responding as much as our call volume increases.
[00:57:11] Councilmember: So that's sort of already been accounted for in the budget looking forward?
[00:57:16] Chief Wright: Yes, absolutely. This is to help as our call volumes keep increasing. It's helped keep it down. But like I said, it is about 2% of the calls on average.
[00:57:26] Councilmember: All right. And just, yeah, no kidding. So, and remind me how long that nurse navigation system's been used.
[00:57:33] Chief Wright: Off the top of my head, about six months now. So, we're still collecting data and seeing how everything works. But from the data we have received so far, 97% of the time it's been accurate once they've gone down the treat modalities, and only 3% of the times once they've gone down nurse navigation, we've had to re-respond a fire engine and ambulance to that call. So, it is working successfully.
[00:57:55] Richard: Thank you, Mayor. If I may mention one other item, looking at the capital projects, I didn't want it to look like we are not funding any capital projects for next year. Where that money is coming from is out of bond proceeds, approximately $22 million, and that will fund the improvements at Stations 71 and 33. And I know Casey will hit on that as part of the CIP, but just wanted to mention that so it wasn't that that was overlooked.
[00:58:23] Mayor: All right, then if there are no other questions, next up we have Erica Castiano to give you community safety, community safety and animal regulation.
[00:58:34] Erica Castiano: Good afternoon, Mayor and City Council members. Erica Castiano, the assistant to the city manager. And the proposed community safety budget is $262,000 and supports essential emergency preparedness, response, and public safety-related services. This funding maintains core community safety programs while strengthening the city's ability to prepare for emergencies, reduce risk, and support the safety of residents, students, visitors, and businesses. The key funded programs include the Citizens on Patrol, the crossing guard services for the district, the local hazard mitigation plan, the Crime Stoppers hotline, and other operational needs such as emergency supplies and preparedness materials. And if there are no questions, I'll move on to animal services.
[00:59:14] Erica Castiano: So, the proposed animal services budget is $617,500 and supports animal regulation and services provided primarily through the Riverside County Department of Animal Services. Of this amount, $550,000 funds the city's contract with Riverside County Department of Animal Services for core animal control, regulation, sheltering, and response services. The remaining $67,500 supports local animal service programs that directly benefit the residents and pet owners. These include the pilot pet adoption, the pet adoption incentive program, the spay and neuter voucher program, the pet reimbursement program, and mobile clinics provided through the county. And I'm happy to answer any questions.
[00:59:58] Councilmember: I don't have a question, just a comment.
[01:00:00] Council Member: Um, for finance, these graphs visually, I understand they're showing proportion, but from year to year, the changes are so much it makes it look like it's flat to anyone who's not actually paying attention to the numbers from year to year. So, I just want to pass that feedback along as I'm looking at it. It's that it just distorts kind of the scale from—
[01:00:21] Erica: They were the bane of my existence the last few weeks. Completely understand. We will fix it for next year.
[01:00:32] Council Member: How quickly did the vouchers go as they became available?
[01:00:37] Erica: Just last week we are out. So pretty quickly. Just a few months.
[01:00:42] Council Member: And if you said a few months, I see a lot of happy faces there. So, I want to take this time to say thank you to everybody that's been involved to go from trying to figure out how much we needed, what were we paying, were we under, were we overpaying, to now with the incentives and creativity of staff, we're down to less than 10 animals in Palm Desert that originated in Palm Desert. That's astonishing to what great minds have come together to put into place. So, thanks to you and the folks at the library and everybody that has to turn someone away because we're doing a great job of reaching out. So, thank you for that.
[01:01:23] Erica: No, it's been a team effort. Everybody's been doing great. It's been a great program.
[01:01:27] Council Member: Thank you.
[01:01:29] Staff: Thank you, Erica. So, next up we have Anthony on legal services. The city attorney's budget funds general legal counsel provided through Best Best & Krieger, including risk management, ordinance preparation, contract review, litigation support, and governance guidance. The proposed budget is $389,256, with the increase primarily related to CPI and the contract amendment. And then for special legal services, the budget funds legal costs outside of the city attorney's general retainer, and these include legal matters, litigation, claims, and other services requiring separate legal expertise. The proposed budget is $732,000 and provides flexibility to address legal needs that fall outside routine city attorney services.
[01:02:21] Council Member: Would our contract with JPIA fall under this, or where would that—
[01:02:26] Staff: JPIA falls under insurance, and that's coming up.
[01:02:30] Council Member: Okay, cool.
[01:02:32] Staff: If there are no other questions, we will jump into our new division, and Richard Canon will give it to you.
[01:02:38] Richard Canon: Just to quickly touch base on this one, this is the new division within the city manager's office, the new communications division. There's really no new staff. This was just sort of a realignment of duties and staff. And so, rather than having community engagement, which was part of economic development, and then marketing, part of the city manager's office, those duties were swapped and realigned. And so now this division includes essentially all communications, website, as well as improving our social media, coming up with a more robust program, making sure that we have a continuity of messaging, and it all has the same look and feel of what Palm Desert is. Also bringing community engagement into this group, as well as being able to assist, serving as a resource for all of the departments within the city. So that way community engagement is not just part of economic development. It's something from the manager's office that we can assist and provide that knowledge base for all departments. And then the PIO functions as the city manager explained a few minutes ago. And with that, I'll be happy to answer any questions.
[01:03:59] Staff: Okay, seeing none, we'll jump into information technology from Clavon Health.
[01:04:07] Clavon Health: Good afternoon, Clavon Health, IT manager. IT staff levels are unchanged, but there is a significant increase in software license costs. As the city continues to modernize our technology, more applications are moving to software as a service platforms. This shift enhances reliability, security, and long-term sustainability, but it also results in higher recurring software expenditures as we replace perpetual traditional on-premise systems with subscription-based service models that are in the cloud. The budget reflects the ongoing costs necessary to support the city's modernization efforts and ensure stable, secure, and efficient technology services across all departments. Happy to answer any questions.
[01:04:57] Staff: Seeing none, we will turn it over to Sky once again, and she'll go through the finance budgets.
[01:05:06] Sky: Hello again. So, first slide will be we're going to go over the finance department. So, our proposed budget is at $3 million. Staff headcount is 16, and salaries and benefits are coming in at $2.87 million. Finance provides citywide budget, accounting, payroll, audit, and financial reporting services with a focus on fiscal stewardship, internal controls, transparency, and supporting all departments throughout the city. If we have no questions, we'll go on to audit. Independent audit budget this year is $93,000. This will be the first year that the city engages with CLA audit firm. Audit services changed over from LSL. This is going to continue supporting financial transparency, compliance, and accountability throughout our annual audit process. Next slide. General services budget is $6.66 million this fiscal year, which funds citywide administrative obligations, retirement and benefit costs, shared services, professional support dues, and grant support. Key drivers include increased PERS costs and the addition of Joslyn Center and Visit Greater Palm Springs costs that were previously budgeted in contributions. Any questions?
[01:06:32] Council Member: Yes, ma'am. What prompted the shift in how those are allocated?
[01:06:38] Sky: Because they're not necessarily contributions. So, in the contributions account, we have outside agencies, we have our sponsorships. So, we wanted to kind of realign with where they are better suited.
[01:06:51] Council Member: Okay, makes sense. Thank you.
[01:06:54] Sky: And then just really quickly, the way the retirement benefits show up here, the dark blue that typically represents salaries and benefits, I just wanted to point out that is strictly our PERS payment, and it increased substantially this year. So, that's why you see that increase in general services.
[01:07:15] Sky: For insurance, our budget for this—the—for fiscal year 26/27 is—
[01:07:20] Council Member: Before we can—can we go back to that?
[01:07:21] Sky: Yes, sir.
[01:07:23] Council Member: Is the CalPERS increase—what is the main driver for the increase?
[01:07:29] Sky: So, there's a couple of things. There's the increase overall with their—oh gosh, my brain—their percentage rate increase, but also the OPEB payment. We pay ours annually, and depending on how that increase impacts our OPEB, it either increases or decreases the amount that we say we'll pay annually over, I think we did a 20-year payment plan. And so, those two are contributing to the increase. So, it's the OPEB, it's the rate that changes it.
[01:07:59] Council Member: And their rate is a formula based on their stock returns plus the contribution from the cities and then the employees. So, if it goes up, does that mean their returns are down, or—
[01:08:13] Sky: This is the backwards thing that gets me every year when I don't have it in front of me. It is we receive the inverse of whatever their rate does.
[01:08:21] Council Member: Right? So when it goes up, they're making less on their investments, right? Okay, got it.
[01:08:28] Sky: Thank you.
[01:08:31] Sky: Okay.
[01:08:34] Sky: For the insurance budget, the proposed budget is $1.87 million, including unemployment insurance. The primary budget driver is a $500,000 increase in California JPIA pooled premiums compared to the prior year, reflecting rising insurance costs.
[01:08:54] Sky: Next slide, please. Interfund transfers come at a total of $27.1 million and support major citywide operations and capital priorities. And then you can see the list, the breakdown on your screen. If I have no questions, thank you.
[01:09:12] Staff: And then the last one for finance is the outside agency funding and community sponsorships. The amount we're budgeting this year is $1.06 million. This is in alignment with our prior year budgets, with the two items that Sky mentioned earlier that we moved to general services for Joslyn and Greater Palm Springs.
[01:09:37] Staff: There are no questions. We can move on.
[01:09:41] Staff: Next up we have Derek White here from Kemper to deliver the Desert Willow budget.
[01:09:52] Derek White: Well, good afternoon, Mayor and members of council. Here we are again, another year. These last 12 months, I know the team at Desert Willow have garnered—
[01:10:01] Derek: A vast number of customer experience awards, as well as course condition awards. This fiscal budget that's proposed will certainly allow us to continue those efforts, trying to make sure that this crown jewel of an amenity stays that way. From a revenue perspective, post-COVID we saw lots of double-digit revenue growth years. We are starting to see that tail off, and we're now in a position where, as echoed from the City Manager, we're seeing much more nominal increases. So we're projecting more in that 2 to 3% growth as there is stiff competition in the market. And then from a cost footprint, those costs just continue to go up as well, whether it's labor, which we don't plan on increasing staffing levels per se, but the cost to employ all those folks, since we are a very labor-intensive unit, will continue to go up. So, as noted in our risks, inflation being a key factor in a business like ours, as well as the tourism trends when it comes to revenues. And then obviously, we'll be constantly watching weather. We like to say all rain at night is constantly welcomed at Desert Willow, but the daytime rain, not as much. I think that that is really the gist. Any particular questions?
[01:11:21] Speaker: Okay, thank you, Derek. Next up, we have Shannon with the library budget.
[01:11:30] Shannon Vonagget: Good afternoon, Mayor and City Council. I'm Shannon Vonagget, the director of library services. So, here we have a proposed $2.6 million budget for the library. The library has 21 employees. Nine of those are full-time and 12 are part-time. In the upcoming fiscal year, the library will continue serving as a community hub for the residents, providing a variety of programming and materials for all ages. Our priorities for the next year include exploring educational solutions and opportunities in northern Palm Desert, as well as preparing an operational plan for our new facility. The requested funding will support the library facility operations, staffing, maintenance of equipment, acquisition of physical and digital materials, and access to online resources as well as programming. I'm available for any questions.
[01:12:22] Speaker: What have you seen as the most successful program, or at least say top five, because I know every month you've got a variety of things?
[01:12:33] Shannon Vonagget: I would say at this current moment, Mahjong. But I also heard from Palm Springs that their numbers have dropped significantly. Our weekly Mahjong is getting over 60 people each time, so we're looking at trying to expand that. We're getting ready for summer reading. Last year we had over 600 participants, so we're aiming high and hoping to hit a higher number this year. But Pokemon is another one that we're seeing huge numbers, and we're working with other community organizations to try and combine those efforts to get everybody playing Pokemon. It's a really popular game that we're finding that people are just looking for that community and a chance to meet other people.
[01:13:17] Speaker: And you said how many do Mahjong?
[01:13:20] Shannon Vonagget: It's been over 60 the last couple weeks.
[01:13:23] Speaker: That's wonderful. Thank you. And thanks to your staff that puts that all together. I know it's a lot of moving pieces, team effort.
[01:13:31] Speaker: Actually, this might be for Veronica. Can you remind me what the, on the revenue side, what we're still receiving from Riverside County?
[01:13:39] Veronica: On the revenue side, we're anticipating 2.3 million next year. We know Shannon will have a balance carryover, so that's why we're able to fund the full 2.6.
[01:13:48] Speaker: Awesome. Great. Thank you.
[01:13:52] Speaker: Um, so next up we have economic development with Martine and his team. Do we need a break or is everyone good to keep going?
[01:14:03] Speaker: Okay,
[01:14:06] Speaker: let's see back here about 1:47.
[01:23:27] Staff: Item 2A. Okay, so next up we have Martine Alvarez and his team for economic development. Oops. Let me move it forward.
[01:23:44] Martine Alvarez: Good afternoon, mayor, members of the city council. I'll give you a brief update on our proposed 2026-2027 budget for economic development. Our proposed budget is 1.97 million. We have a staff of eight team members. The mission for our department obviously is to grow and sustain our economic growth by attracting, retaining, and expanding business throughout the city while helping to support the local economy, quality of life through strategic partnerships and investments. This includes key land transactions and dispositions that will also advance economic development goals throughout the city. Our department's goals also align with the city council's goals by advancing the redevelopment of the mall, by promoting and attracting family-oriented entertainment opportunities, also by creating and enhancing citywide events and entrepreneurship initiatives, and also creating opportunities for new businesses that will be long-sustaining the local economy and diversifying it as well. The key outcomes that we're gearing towards is to support the sale and redevelopment of the city-owned Sears site and also coordination with the mall ownership to advance the specific plan that will completely remodel the entire site. We're also looking to promote and attract a farmers market here in the city of Palm Desert and also by implementing regional events, marketing strategies that will help us attract visitors and new opportunities for new technology businesses throughout the city as well. We're also looking at initiatives to bring new services to North Palm Desert that will help support the new growth in that area. And with that, I will be happy to answer any questions you may have.
[01:25:39] Council Member: I do. I mean, this is a little bit off-budget topic, but you mentioned farmers market. At the most recent El Paseo meeting, Patrick mentioned that the Gardens is pursuing that, that the ownership at the Gardens is pursuing a potential farmers market up on the parking deck. Is this—are we in concert with them, or are we pursuing something separate?
[01:26:01] Martine Alvarez: We are looking at any and all opportunities to bring a farmers market to Palm Desert, and I certainly would be happy to touch base with Patrick at the mall, but we have not connected yet there.
[01:26:20] Council Member: No. Can you tell me or estimate for me how much we've taken in as revenue from the dining decks?
[01:26:27] Martine Alvarez: Was it substantial? I don't have that off the top of my head, but we can certainly look into that.
[01:26:34] Council Member: Yeah, just a—just an estimate, because I know we've talked about the benefit and who and what is this doing in terms of staff work and projects, because we've talked about the benefit of realigning. So, it just kind of popped in my head as a question of how much is actually being generated. Thank you.
[01:26:56] Martine Alvarez: If there are no other questions, we will move on to community promotions with Amy Lawrence.
[01:27:04] Amy Lawrence: Good afternoon. Amy Lawrence, deputy director of economic development. The community promotions account includes funding for city-produced events such as the Independence Day celebration, which is enhanced this year for the 250th anniversary of our nation, concerts in the park, fall and spring, and other events that take place throughout the year. The account is also used for the courtesy cart program. So with that, I would be happy to answer any questions.
[01:27:36] Staff: Okay, thank you. And next up, we have Thomas Soul with the marketing budget.
[01:27:42] Thomas Soul: Good afternoon. Thomas Soul, your marketing and tourism manager. The purpose of the marketing program is to promote Palm Desert as a destination for visitors, businesses, and investment through tourism, event, and economic development marketing. The proposed budget is 1.66 million for this year, which is about a $200,000 reduction from last year. The reductions have come primarily from the hotel co-op line and then a reduction in media buys. Should more requests come in through the hotel co-op program, we'll bring them to council. But at this point, every year we budget for that, the known amount that we've already promised for the next fiscal year, and then we budget extra money in case requests come in in the year for the year. And so that money may or may not get used. So what we've done is reduced the extra amount so that it's a little bit more in line with what we actually spend, per what Veronica had mentioned earlier. And if we exceed how much we have, we can always bring back requests. And I'm happy to answer any questions.
[01:28:51] Council Member: You mentioned that if there is a shortfall, you can come back and ask for more money. What's the margin of error that you give yourselves in terms of the kind of expenses that could pop up? Are we talking a little bump or a big chunk?
[01:29:05] Thomas Soul: It's hard to tell. It's a very good question. It really depends on what business comes, pretty much. This is with the JW Marriott. So if they have a group that would like to come in in a need period—so during the summer, early January, early December, times when Palm Desert is not—our hotels are not full—if a good opportunity arises, then they come to us and make a request, and then we work with them based on the funds that we have available. So it kind of depends. Sometimes nothing comes in, in which case the money all goes back to the general fund, and other times we use chunks of it. So, it's really hard to predict this year. It seems like we're pretty solid for the coming fiscal year. We don't see a lot of new requests coming up short-term, but longer-term is a little bit more play, and that's three to five years out.
[01:29:56] Council Member: Yeah.
[01:30:00] Speaker: Thank you.
[01:30:01] Speaker: Okay, next up we have adult development services and we will receive that from Kina Perez.
[01:30:15] Kina Perez: Good afternoon, Mayor and City Council. My name is Kina Perez, Management Analyst in Development Services. I'll be here to present the 26-27 budget for Development Services, which includes planning, code, building and safety, permit center, housing, and engineering. The Development Services budget supports department-wide operations and key planning efforts that advance Council priorities. Our fiscal year 26-27 focus is continued support for long-range planning efforts including UNSP updates, UDC add-ons, downtown initiatives, and SQA efforts, as well as process improvements and customer service enhancements. This supports strong internal coordination and improved resident, business, and applicant experience. Any questions?
[01:31:05] Kina Perez: Okay, next slide.
[01:31:07] Kina Perez: The building and safety budget ensures construction and remodeling comply with state and local code requirements to protect public health, safety, and welfare. Our fiscal year 26-27 focus remains on prior year priorities, including monitoring plan review timelines, permit processing, and inspection availability. The intended outcomes are improved service timeframes, workflow efficiency, and customer satisfaction. Any questions?
[01:31:36] Kina Perez: The next budget is going to be the permit center. The permit center budget supports the Council goal of a centralized, one-stop-shop experience for city services. Our fiscal year 26-27 focus is on Phase 2 Clarity implementation, the addition of fire fees and business licenses into the Clarity system. What we expect from these improvements is improved internal workflows, increased automation, stronger recordkeeping, and a more streamlined customer service experience. Any questions?
[01:32:07] Kina Perez: Next slide, please. The code compliance budget supports clean, safe, and attractive community standards through municipal code enforcement. Our fiscal year 26-27 focus is the commercial compliance program supporting the zero blight initiative. The outcomes we're working toward are reduced blight and repeat violations, faster complaint response, and increased voluntary compliance. Any questions?
[01:32:36] Kina Perez: Next slide, please. The engineering and land development budget supports plan review, land development processing, and coordination on private and public projects for fiscal year 26 and 27. The budget continues support for staff and consultant resources. As you'll see, there is a note there that it includes a $250,000 allocation for CIP consulting services within the engineering budget. This supports improved plan check turnaround times, quality control measures, streamlined workflows, and clear communication.
[01:33:14] Kina Perez: Next slide for the Housing Authority fund. This supports the preservation and management of the affordable rental housing properties owned by the Palm Desert Housing Authority. The fiscal year 26-27 focus is still continued work on health and safety projects, ongoing operations and maintenance, as well as tenant support. The goal is to maintain safe and stable housing assets while continuing to preserve the city's affordable rental housing properties. Staff will return at a separate study session for a more comprehensive housing update, including key risks, opportunities, and potential strategies. Any questions? Thank you.
[01:34:01] Speaker: Thank you, Colleena. We'll move on to Public Works and hand it over to Randy Chavez and his team.
[01:34:07] Randy Chavez: Good afternoon, Mr. Mayor, City Council members. Randy Chavez, Director of Public Works. The next several slides we're going to be talking about the different divisions in Public Works, but all divisions share one priority for the upcoming fiscal year, and that is to focus on safety, cleanliness of the city, and efficiency in delivering our maintenance services and capital improvement projects. So with that said, we'll dive right in. So the first slide is our Public Works Administration. This is the team that's primarily here at City Hall. The staff count has remained unchanged and the budget is pretty much the same as last fiscal year. So just to highlight some of the projects we will be working on next fiscal year, like I mentioned, safety is obviously a priority. There's a lot of traffic improvement projects, playground repairs, ADA and street improvement projects, to name a few. And also, we are working on the wayfinding master plan. So these projects here, they'll either be awarded or in construction next fiscal year. And I would like to invite Miss Julia Brier to give the next presentation.
[01:35:28] Julia Brier: Good afternoon, Mayor and City Council. I'm Julia Brier, Senior Project Manager in Public Works. The Traffic Division's fiscal year 25-26 budget remained consistent with prior fiscal years. However, the proposed fiscal year 2026-27 budget increased to approximately 1.7 million. Apologies, the overall increase is primarily associated with the transition and incorporation of the city's public art program into our division. The proposed budget supports the continued operation, maintenance, and reliability of the city's traffic control infrastructure, including our traffic signals, street lighting, traffic control devices, and public art assets. Funding priorities include preventative maintenance, safety improvements, timely repairs, and operational enhancements that are intended to maintain system reliability and support our efficient traffic operations throughout the city. The Traffic Division continues to support City Council's clean, safe, and attractive city standards initiative through our data-driven operations, regulatory compliance, proactive infrastructure, and responsive service to our community concerns and operational needs. And with that, I'll take any questions.
[01:36:45] Speaker: Thank you.
[01:36:48] Randy Chavez: So, moving on to the Public Works streets and maintenance. There has been a slight increase in the budget for salaries and benefits, and that's due to the two additional street maintenance workers that will be coming on board next fiscal year. One of the things we budgeted for next fiscal year is parking lot maintenance. Keep in mind, this is not a capital project account, but merely an account to respond to emergencies and citizen requests for minor improvements. Corp yard, this is primarily for repair and maintenance, this budget. And it's similar to last fiscal year. Next fiscal year, it's about the same, no major changes. The fleet repairs, the repairs are forecasted to be down next fiscal year. This is partly due to the arrival of new vehicles based on the new fleet purchasing policy that's in place. Facility maintenance, this is for City Hall, a little bit of the Joslyn Center, and our Historical Society. And again, it's pretty much the same, with the exception that we had a slight reorg, so the salary is slightly more next fiscal year because of the Public Works Superintendent that is in this division now. And with that, I'll turn it over to Miss Sean Muer.
[01:38:42] Sean Muer: Thank you, Randy. Good afternoon, Mayor, members of the City Council. I'm Sean Muer, the Community Services Manager. Talking first about the Portola Community Center. This is for the Portola Center building, so it's a stable budget. There's no major change. And this budget focuses on small maintenance projects, such as this year we're repainting some areas and doing some lighting upgrades. Questions? Next slide.
[01:39:09] Councilmember: I do. What are the professional services for? Is that the contract for DRD to operate it?
[01:39:15] Sean Muer: Yes, that's correct. For Civic Center Campus park maintenance, this budget actually decreased. We have completed a number of deferred maintenance projects over the past few years, so we're able to manage a decreased budget in this area. It does also include professional services for Desert Recreation District staff.
[01:39:42] Sean Muer: And the next slide, citywide park maintenance. This includes all other parks besides Civic Center Park. We did have some additional parks come online this year at the University Park area, but we are able to manage those within this slightly decreased budget.
[01:40:00] Veronica: And for community services, the community services team consists of seven team members: a manager, a project manager, one management analyst, and four landscape inspectors. They're responsible for maintaining all of the medians, El Paso, Artist Center, and San Pablo. We're also responsible for any park improvement planning, and some minor capital projects under public works, community programs such as Arbor Day, Tree City USA, and the Mayor's Monarch Pledge. And this budget went slightly up, and it's mainly due to salary increases.
[01:40:39] Veronica: My next few slides are about the Palm Desert Aquatic Center. Last year's budget looks a little bit different in terms of expenditures. I'm sorry, the current year's expenditures look a little lower than normal, and that's because of the closure that happened to make repairs in the pump room. Next year, we plan on being back to normal operations. So there's a $3.4 million operations budget that will be offset by an anticipated 1.1 in revenue. So we anticipate the general fund transfer for the Palm Desert Aquatic Center support is 2.3 million on the right.
[01:41:15] Council Member: A question on that. So expenditures are down due to the closure, but revenues are still pretty high. Where is the revenue coming from?
[01:41:25] Veronica: That is actually the transfer that we make from the general fund to support it.
[01:41:30] Council Member: Okay.
[01:41:31] Council Member: Thank you, Veronica.
[01:41:37] Council Member: Is the aquatic center fully operational yet?
[01:41:41] Veronica: The aquatic center opened yesterday to lap swimming and water exercise. We do have a closure on Saturday so that we can train additional lifeguards and get all of our recreational amenities up and running. But aside from that, we'll be up and operating as normal.
[01:41:55] Council Member: Great. Thank you.
[01:41:57] Veronica: You're welcome.
[01:41:59] Veronica: And on the right here on this chart, you do also see the 1.75 in capital for the coming fiscal year. We're not undertaking any major capital investments for the aquatic center. This is for some landscaping improvements, some fencing on the east side of the parking lot, and bank stabilization near the channel that is adjacent to the aquatic center.
[01:42:21] Veronica: And to your question earlier, Mayor Pro Tem, we are using the transfer from fiscal year 25/26 to cover those capital improvement costs for 26/27. You're welcome.
[01:42:36] Veronica: Any other questions about that slide? Okay, next slide. So this month we're preparing for the full reopening and inviting the community back. We're initiating a deeper analysis on the use patterns and the service levels that are being provided at the aquatic center. We've got a tracking system in place now for our facility assets, so we can see how they're being utilized and when they might need to be replaced, and we'll enhance communications around that, both internally and externally as needed. We'll also continue to collect key performance indicators. It's something that we already partner with the YMCA on tracking so that we can be responsive to any trends and metrics that come up so we can try to increase our programming as we go forward. Any questions about that?
[01:43:27] Veronica: All right, last slide on the aquatic center is a look ahead. And so the goal here is going to be to address the city subsidy. We are targeting three key areas to do that, and that is increasing attendance by updating the marketing strategy, refreshing the website, and using targeted advertising, and then increasing our revenues, and we'll do that by diversifying our offerings, increasing our programming, our offerings at the concessions area, etc. And then maintaining our updated facility information. I mentioned that tracking system. We'll be keeping tabs on how all of the equipment is doing and plan for its maintenance or replacement in the future. And that's my last slide. Any other questions?
[01:44:13] Council Member: Um, we had talked in years past because we're implementing that, what, a five-year program to increase rates just a little bit at a time over the course of five years?
[01:44:22] Veronica: Yes.
[01:44:22] Council Member: Okay. So, with the closure now reopening, now that it has reopened, have the new higher admission rates been implemented since the closure?
[01:44:34] Veronica: Yes, that's a great question. And the last fee increase was implemented in July of last year. This year, we opted not to do the fee increase because we were closed for so long. However, it will reopen, go back through summer, and then reassess in the future to see whether a fee increase is still warranted. But there will be no fee increase in 2026. That's planned.
[01:44:57] Council Member: Okay. So we're at the same admission rates as we were last summer.
[01:45:00] Veronica: Correct.
[01:45:01] Council Member: Got it. Okay. Gina.
[01:45:02] Council Member (Gina): Yeah. And then who is—remind me, who is the internal team that's going to be in charge of hopefully increasing attendance?
[01:45:11] Veronica: That's the city's team in partnership with the YMCA. And so the public works team in community services, of course, Director Chavez, myself, and a management analyst and project manager that are assigned.
[01:45:24] Council Member (Gina): Okay. So, I hope we have some great ideas for this.
[01:45:26] Veronica: We do.
[01:45:29] Mayor: Any other questions?
[01:45:31] Council Member (Gina): Thank you.
[01:45:33] Council Member: Right. I didn't realize you were done with the parks. I apologize. One last question. Baja Park, we had, I thought, put the green light on some improvements there, and I understand that there's some question whether or not we're going to pursue major improvements at Baja Park, and where do we stand with that?
[01:45:53] Staff (Chavez): So Baja Park, the design is completed. We are looking at grant opportunities for that full park design, but we really scaled back—and it's a good segue because Casey's coming in—of looking at the scopes of our projects in terms of what the scope is and what we can afford. So, right now the clear needs are conducting lighting, some refresh of the landscaping. So, we have half a million dollars set aside to conduct that work, and should we secure grant dollars, we will complete the rest of the design.
[01:46:24] Council Member: Thank you.
[01:46:26] Staff (Chavez): And last but certainly not least, Casey with the capital projects budget.
[01:46:31] Casey Arndt: Save the best for last.
[01:46:34] Casey Arndt: Good afternoon, Mayor and Council. Casey Arndt, director of capital projects. I'm pleased to present the proposed fiscal year 26/27 capital projects budget and discuss the department's direction moving forward. Our proposed operating budget remains generally consistent with last year, with the exception of an additional position that was reallocated from finance, bringing our staff total to 10. In capital projects, our two greatest operational risks continue to be cost escalation and schedule delays. As a new director, I'm taking a comprehensive and disciplined approach to how we plan, design, and deliver projects. We are evaluating projects from conception through completion with a focus on early collaboration, defined project scope, cost accountability, schedule performance, and regular council engagement and decision points. Our goal is not simply to deliver projects. It is to deliver the right projects at the right scope and within budget. One example is Dwin Park. Staff will be soon—will be bringing forward in two weeks a revised delivery strategy that provides council with clear options and a phased approach for consideration. Moving forward, we will also place greater emphasis on designing projects to establish budgets rather than developing full concepts first and pricing them later. Our department remains aligned with council priorities by maintaining and improving public infrastructure, protecting city assets, reducing long-term risk, and delivering high-quality public improvements responsibly. Ultimately, success for fiscal year 26/27 and beyond will be measured by our ability to deliver projects on time, within budget, with transparency and accountability. Over the next few slides, I'll discuss the specific strategies we are implementing to achieve that. Next slide.
[01:48:21] Casey Arndt: These eight projects represent some of the city's major priority projects for fiscal year 26/27 and beyond, though not our full capital portfolio. These projects are the foundation of our spending over the next three years. I'll begin with the library. The new library, the Park View building demolition is now complete. Hopefully, you've seen it. Looks great. It's gone. The revised RFP process is currently underway. We held a pre-bid meeting on April 23rd which was attended by nine builders, seven architects, and two engineering firms. The deadline for submissions was extended one week after we received two inquiries to extend the deadline.
[01:48:57] Council Member: You said two architects?
[01:48:59] Casey Arndt: Seven architects and two engineering firms.
[01:49:02] Council Member: Ah, I thought we already decided on Rashard Kennedy, or is that...
[01:49:06] Casey Arndt: So they were the design—they came up with a conceptual design, but not...
[01:49:10] Council Member: Yeah, perfect. Thank you.
[01:49:11] Council Member: And I have a comment on the library. Is now the time?
[01:49:15] Casey Arndt: Yes.
[01:49:15] Council Member: I really am concerned about the budget that the proposals you're getting. I've heard a few whispers that to build the library for 30 million is near impossible. And I believe that's a big concern for this council.
[01:49:35] Casey Arndt: Understood. And that is a concern of ours as well. And I'll actually get to that in just a second. I'll speak to that just a little bit. So the proposals for this, after we extended the deadline, so now the proposals are now due May 21st, with final consultant selection anticipated in June and a presentation to council for award expected July 9th. It has been a year since we established the $30 million budget that...
[01:50:00] Staff: ...will, and recent independent costs. Cost estimates indicate escalation in atypical market conditions, such as volatile oil prices and regional procurement demands tied to the 2028 Olympics that could result in a project cost exceeding the $30 million threshold. So, to your point, the $30 million was established a year ago, and in the construction industry, we're seeing escalation of prices generally higher than what we've seen in the past. So...
[01:50:32] Councilmember: So I couldn't help but notice when we were looking at public works that page after page, what you're dealing with in operational risks is material cost escalation. And that's applicable across the board and certainly with this. So I look forward to getting the information as soon as possible so that we can get moving in the best way forward for the library. Thank you.
[01:50:56] Staff: Agreed.
[01:50:58] Staff: As staff, we will actively explore additional funding to help bridge any potential funding gaps. Moving on to Dave Irwin Park. This project continues through design. Staff will bring a study session item forward on May 28th to discuss revised project delivery options and a phased implementation strategy. Fire Station 102 is nearing completion. Temporary occupancy is anticipated this August with final completion anticipated in September. Fire Station 33 and 71 continue through their final design, and staff is actively working with Cal Fire on alternate temporary station options which may reduce both project costs and construction duration. This reflects our broader effort to evaluate projects differently and identify opportunities for efficiencies while still delivering high-quality projects. Our street rehabilitation program, street resurfacing, remains one of the city's core infrastructure investments. This fiscal year includes major rehabilitation work on Cook Street and Monterey Avenue. Walk and Roll Palm Desert continues expanding and improving pedestrian, bicycle, and golf cart connectivity throughout the city. Phase two, which focuses on bicycle lane improvements, will be complete next month. And phase three, which focuses on pedestrian improvements, begins next fiscal year. And finally, Haystack channel improvements, we're working through the final design and permitting with construction anticipated to begin next fiscal year.
[01:52:26] Staff: So, construction cost escalation continues to be one of our largest challenges facing a public agency as well as our department. As shown in the California Construction Cost Index, the five-year average escalation rate was approximately 7.66%. Current market conditions trending higher than average based on inflationary pressures, labor costs, supply chain constraints, and material pricing which continue to impact project costs. Because of this, staff is implementing stronger project controls and financial management practices across the entire program. Some of our key process improvements include cost monitoring and estimate updates. Staff will regularly update project estimates throughout design and construction to reflect current market conditions and real project risks. This increases transparency and maintains cost controls. Scope discipline: We will place stronger emphasis on controlling scope and avoiding unnecessary project expansion and overdesigning. This helps maintain alignment with council priorities, project needs, and available funding. Strategic cash flow management: Staff will work closely with finance to better forecast actual construction expenditures. This improves liquidity management and maximizes interest earnings by timing expenditures appropriately. Reserves financing analysis: Projects will be evaluated strategically to determine whether reserve funding or debt financing would be recommended. This analysis will compare borrowing costs against projected construction escalation costs by deferring projects. Life cycle cost review: Staff will evaluate long-term operational and maintenance impacts during project development. This goal is to reduce long-term maintenance burdens and operating costs while improving asset performance. Contingency management: Contingencies will be based on real project risks and updated regularly throughout the project life cycle. This creates more accurate budgeting and reduces unnecessary inflation of project costs. Value engineering: Staff will continue evaluating project elements to ensure we are delivering intended outcomes efficiently and responsibly. The focus is balancing quality, functionality, and long-term value. This helps to control construction costs and long-term expenditures. Council decision points: An important part of this process is providing council with clear options, financial impacts, and decision points early in project development. Using Dave Irwin Park as an example, staff will present phased implementation options that will allow council to determine the appropriate level and timing of the investment. Moving forward, our approach to capital projects will emphasize transparency, fiscal responsibility, cost consciousness, high-quality project delivery, and on-time and on-budget performance. Happy to answer any questions.
[01:55:16] Councilmember: Yeah. So, I'm very happy to hear your closing statement. That's so important, being cost-conscious and everything you just outlined. And thank you very much.
[01:55:26] Staff: You're welcome.
[01:55:28] Councilmember: I had a similar comment that every department has come and given their plan, but I appreciate that you broke down how you're going to make it happen. A lot of the other are great presentations, but I said this aligns here, but I appreciate that you've brought it down to a little bit more detail that other teams may say that's a great way to sometimes even word it. The way that something is worded will change a group's desire to get it done in a certain way. So, I appreciate every single person that's involved in City Hall and making all of this run so the numbers look reasonable to us. Questions? All right. Thank you.
[01:56:16] Staff: So to round things out, the proposed 26-27 operating budget is balanced. It prioritizes alignment of operational costs with the 2026 council goals. The budget anticipates general fund transfers for different services for PDAC, for the library, for fire services, the entrepreneurial center, and other Measure G operational costs that it supports. You know, the largest increaser is public safety costs, and we've mentioned that earlier. The CIP includes over $300 million worth of projects over the next 10 years, which, as Casey mentioned, will be brought to you for consideration in a timely manner. And general fund reserves may be necessary to complete those projects, but we will bring you those decision points at the time that they're needed to be considered. The Housing Authority complex operations are generating positive NOI. Staff continues to pursue resource opportunities for capital improvements and will come back to Council, as Kina mentioned earlier, for a deeper dive into that. We look forward to another busy and successful fiscal year, and appreciation out to staff, all the different department directors and staff leads for walking us through the budget. And also to my team, to Sky and Austin, for taking on the lion's share of producing the budget each year. I just want to say thank you. And if you have any additional questions, we're all here to answer them.
[01:57:55] Mayor: Right. Any questions for my colleagues?
[01:57:58] Councilmember: All right. I think I speak for all of us when I say it was thoughtful and well-presented and well-researched, and we appreciate it. Thank you.
[01:58:12] Mayor: Is that it?
[01:58:13] Staff: That concludes your study session, and you have no closed session.
[01:58:16] Mayor: So, we're not going to talk about the City of Palm Desert Wilden Benefit Assessment District. Okay. Very good. Thank you so much. Well, then I guess I will adjourn the study session at 2:25. We'll see you back here at 4 p.m. for the regular council meeting. Thank you.