May 19, 2026 6:00 PM - Redding City Council - Regular Meeting

>> All right, if anyone wishes to address the City Council on any item considered at this meeting before or during the council's consideration of that item, please enter your name in the electronic kiosk located in the lobby, the City Council will allocate up to a maximum of 3 minutes per speaker for each agenda item. Staff reports are available online at the city's website and also in the public view binder located on the podium at the north side of the chambers. Mike, say, in closed session, do we have any reportable action coming out there? >> Thank you, Mayor. The council met in closed session on the items listed 3A to 3D. No reportable action this evening. >> All right, thank you very much. We're going to call this meeting to order, we'll start with our Pledge of Allegiance, and after that we'll have our invocation by Patrick Blewett from Simpson University. All right, ready? >> I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, indivisible, Liberty and Justice for All. >> And for our invocation, hear these words: We pause to reflect on the immense responsibility entrusted to this council, Lord. We ask that a spirit of unity prevail in this chamber today. May the discussions be respectful, the focus be sharp, and the council decisions promote peace and prosperity in our city. May the work of this council and the employees of this city honor the community they serve. May the primary campaigns and elections coming our way be filled with honesty and integrity. We are thankful. We are thankful for the safety and the joys we saw this last week with the Redding Rodeo Week. And we're also thankful for the events that have happened and will happen in these next months for the America 250 remembrances. Finally, God of heaven, we ask that you bless abundantly everyone who is in attendance at this meeting. Allow us all to listen to each other. And all God's people said, amen. >> Okay, we'll start with roll call. [CALLING ROLL] >> All right, we're going to get going. We have a presentation that it's, it's the mayor's presentation. It's honoring the 250th birthday of the United States of America, the mayor is inviting all the residents and businesses in the community to display the flag of the United States of America from May 22nd, 2026 to July 12th, 2026 as a symbol of our national pride and unity. Today I gave everybody a flag out there. Who got a flag out there? You can raise that and feel really proud. If you didn't, I've got lots of them out here. I wanted to bring those out to have everyone to take home. A little story and background there. In 2020, my family began placing small American flags on about 600 lawns throughout the neighborhood just to restore a sense of pride and unity. And that effort is now an annual tradition in my family. It is our nation's 250th year, and what I'm asking is every Redding resident to join us by taking these flags and displaying them on the lawns between May 22nd and July 12th, 2026. And I'd also ask you to consider organizing or joining your own neighborhoods to do flag walks, to place flags on lawns across the city, And the goal to show unity and civic pride, to honor our service members and the fallen, and the spotlight. We should spotlight Redding as a community that remembers and celebrates. And so I just hope you display this flag that you take home today, and maybe you'll have meaningful conversations with your neighbors in your neighborhood to do something big like we've done in my own neighborhood. Pick 10 homes, 25 homes, 50 homes, do 100, do 600, do as many as you want. When you do this, I say, could you share your plans and all your photos with the city so we can also celebrate and we can highlight all the neighborhoods within the city as we do this together. Encourage your neighbors, your schools, your veteran groups, all the businesses to participate. And then finally, attend the Fourth of July fireworks show at the Civic Center and celebrate as a community. So join me in filling Redding. Please, I just ask you to take these flags home and do this and just celebrate We're going to honor those who served and celebrate our nation's 250th, and we're going to show the pride that makes Redding really, really special. And I hope you just do this with me. Thank you very much. >> So thank you, Mayor. >> Yeah. Very nice. >> Thank you. >> And if you want more flags, we have more. We can send them. I've got about 1,500. We can take it. I'll give you as many flags as you want. >> Can you send us the Amazon link so we can all save? >> Yeah, we can. You'll order 10,000 yourself and all right. I love it. Okay, it's it's time for uh, public comments for non-agendized matters within the city's jurisdiction pursuant to the Brown Act. And the city council, we cannot take action on any public comment items, the city council will allocate up to a maximum of 3 minutes per speaker for 30 minutes total at the beginning of the meeting for public comment for non-agendized matters within the city's jurisdiction, the mayor will determine the order of the speakers, and if 30 minutes is not adequate to accommodate all of the individuals who've submitted their name through the electronic kiosk, The council will trail this item to the end of the open session agenda, and the remaining speakers will address the city council at that time, we have 3 speakers today, we have Christina Prosperi, we have Robert, and we have Leslie. So if you're here you guys can line up on the wall and we will get going. >> Hi everyone, good evening. Mayor, Council, city staff, and our community both here and online. I'm usually one of the 28 people on YouTube watching, so you can remember that next time, like, I'm there for you. So my name is Christina Prosperi. I'm president for the Reading Parks and Trails Foundation. We were formed in 2017 specifically to support the, City of Redding Community Services Department. We advocate for our parks, trails, and open spaces. We support program and project development. And funding, and we fundraise. So today I wanted to share with the community about our new fundraising effort that will be annually. Traditionally, we had Wine and Dine right here at City Hall, which was amazing, and did that for years. And we've transitioned out of that and are coming into a little bit more alignment with getting people and into our parks and trails and celebrating that. So with Ironman, we've had a great opportunity to leverage their Your Journey, Your Cause platform And we are going to focus on our Redding athletes that are going to be participating in that Ironman event. So for August, these are our neighbors, our co-workers, our coaches, our parents, and hopefully some of our youth that are going to be bringing in as well. We would like to start bringing in those younger generations to start doing good and having a good time. The goal is that we are naming this Race for Reading. You can find information on our website. These athletes are going to create personal fundraising pages, tell their stories, share their why. We in turn are going to share about them as well. They are going to be tracking their training on our parks and in our trails, and we get to celebrate that. Honestly, it's an adult jogathon with very expensive equipment, and it's going to be a good time. But the goal is that we can share some community pride, and this can follow every year for the Ironman event. So if you want more information, you can take a look at our website, you can contact me directly or reach out. I'm pretty easy to get a hold of. And we would love the partnership for the City of Redding to share this as well. And it can be even if you're relaying, you can still be a part of it. And we appreciate any support that we can get, and we look forward to continuing to support our Community Services Department. Thank you. >> Thank you, Christina. All right, Robert, if you're here, where are you? There you are. >> Good evening, City Council. Just wanted to remind everyone, June 2nd is voting day, and regardless of where you stand, get in, be informed, have an informed opinion, and vote for the candidate that most aligns with you and and there's plenty of information out there to kind of objectively look at who, who it is you're going to support. So regardless of who you support, so just vote. Thanks. >> All right, thank you, Robert. Leslie. >> Hello. Okay, so the state capitol has kept me busy and out of your guy's hair the last couple months, but, I've been focusing on what our legislators are and are not doing. So, Mr. Tarbo, sorry it's taken so long to meet you, but hello, nice to meet you. I realized in writing what I wanted to say about the advanced Redding portion that I was going to go off on a tangent that didn't apply to that item, so I'm going to use public comment time for that. I am so glad you are here. I would like to see us start digging through and combing through and auditing a lot of our departments and where money's going. And I heard that that's what you were going to do when you got here. So I have been spending a lot of time out of area, like I said. Last week Paradise City, or Town Council, had a meeting where they talked about what they were going to do with their TOT. Their TOT is like 10% of what we get, yet they are doing huge things with it to bring people in and rebuild the town of Paradise. Huge things, things that show actual progress, things that have actual returns on investment that are proven. We, however, got over the last 3 years between $7 and $8 million a year. Our Parks and Rec Department is a nightmare. We have the, Redding Sports Park thing, Motorsports Park out at the airport. I'm sure you've heard all about that. 13 years, one community group has been doing all of their own costs, all of their own building, all of their own maintenance out of their own pocket, not even out of the city's. So no TOT tax went there. Out at Big League Dreams, now whatever it's called, they have a group that's working their butt off to run that department week to week, season to season, not having a clue whether or not they're going to be operating. It's really hard to do marketing and sell a product when you don't know if you're going to be in business the next month. And now we've got the Civic Auditor which I'll talk to you about later. I got plenty to say on that. But That is ridiculous, and that is just the tip of the iceberg with the overspending, the corruption, the failures, everything that's happening in the city of Redding. So welcome, thank you, and I sure look forward to talking to you, and I mean that, even if it sounded mean. >> Okay. All right, the consent calendar. Consent calendar contains items considered routine and/or which have been individually scrutinized by city council members and are anticipated to require no further deliberation. If a member of the public wishes to address an item on the consent calendar, please enter your name in the electronic kiosk located in the lobby before the consent calendar is considered. It shall be prerogative of any council member before the consent calendar is acted upon to: 1, comment on an item; 2, respond to any public comment on an item; 3, request the record reflect an abstention, nay vote on an item; or 4, remove an item and place it on the regular portion of the agenda for delivery of a staff report and/or an extended discussion or deliberation. All right, I don't see any speakers for consent unless I miss anything. >> Can I have a comment? Yeah, so on item 4. Or I'm sorry, 4E, I just had a comment. this is the second reading for the rezone for the Churn Creek Commons subdivision. I, had looked through that the last time this was read, and the changes that the council that the Planning Commission requested and that the council asked are not reflected in the resolution. I just wanted to make sure that it was noted though, and that it's still that the standard of how this is going to look is not going to be as it was presented to us, that it is going to be modified to excellence. For its look, because it's not reflected in this ordinance. I just didn't know there was no note that said that that change was made, so I was just is that necessary to happen? Anybody? Anybody? Bueller? >> Yes Council Member Audette. If I recall correctly, and I may need Director Pagan to confirm if he's here this evening, but if I recall correctly from the last meeting, what we confirmed was that that would actually fall within the discretion of the Development Services Director or Building Official. And I believe we confirmed that they could take care of that on their own. >> That's enough. Okay, so we are going to harass you privately about that. It is. Okay, that's what I needed. >> Essentially, I asked during that meeting whether or not there was some sort of objectable or objective. >> Yeah, and I went and looked that up, but I didn't see it. Reflected in this. I just wanted to make sure that it was noted and that we know that. and then 4.14.10A, I just want to make sure that the public is aware, because this is a consent item, there are some major fee increases that are being proposed. When we say yes to the consent calendar on June 16th, this is going to come back, and these are going to have major changes, major increases. The question I have is, did is there any developer group that we passed this through that's going to look through and give any type of feedback on this? Because we just did a major fee increase last year. So do you have that information, Jeremy, or is it just going to come back for a public hearing? >> Want me to get the mic? >> Sure. >> At this point, it's just been done at the staff level, just looking at fees and looking at where we're likely losing more money than not. So we just done discussed at staff level. I think last year we did a stakeholder group and involved a few folks. Yeah, we could circle back around with them before the hearing or make sure they know about the hearing as it comes up. >> If even if they could just be emailed this specifically, the staff report and the attachments, that they can, if they want to make comment on it. They've sort of been through the process. They kind of went through a lot of these fees before. I would like to have their impact either in, in your report, or if they want to come and tell, tell us that. But I also just want to make sure that the public is aware there is large fee increases. And so if you want to weigh in on those, you may not be aware, but the, the hearing that we're going to by consent say will be for June 16th. >> We'll look at who we invited last year and connect with them. >> Thank you, appreciate it. All right, that's all. >> Do you want to make a motion while you're at it? >> I'd like to make a motion to approve the consent calendar. >> I'll second. >> All right, all in favor? >> Aye. >> Aye. >> All right, moving along to item 5.1. We're going to consider the council member appointments to the City of Redding Audit and Financial Advisory committees there. I think we're able to jump straight to it. I don't think we have any staff to talk in the sign today, but we do have one speaker, just popped up. So Robert, if you're here, we're going to let you speak. >> Real quick, just, a reminder for city council members: when you're choosing people to represent various committees or commissions or whatever, look at qualifications and look at experience and make sure that the overriding reason that you're appointing them is because they're suitable for the job and they have an experience with whatever it is they're appointed to. Really important because we see the names and it's sometimes just looks strange. So just a reminder to be diligent and think about, think about this, the city needs and the county needs first. Thanks. >> All right, thank you. If you are paying attention to the agenda when it came out on Thursday, there was a staff report update on Friday as there was a revision to the nominations there. So if you picked up an agenda packet today, it should be refreshed and you're seeing that. But if you're relying on your agenda that if I printed out on Thursday, this has been updated. So we have 2 nominations, some back history there. I think we had our meetings with the council back in November or December. We made recommendations to just help with financial oversight, more people that will consider and looking at our auditing and be part of the process there. So government moves very, very fast. So here we are in May after November and December when we started this process here. And so As far as our Audit Committee, out of Audit Committee, we resolved as a council that the mayor would appoint one non-voting member, and that would be a 2-year term, and that would go until November 30th, 2028. My nomination for that is Ken Freyer, if I pronounce that right. Ken, if you're here, you'll tell me later. But I had a good conversation with Ken. I think he's going to be a great fit. He has good financial background and auditing experience. And I, I just had very, very good conversations. I think he's just going to be a great fit. And I will say, in, in looking at all the applications, there was far more interest in the financial oversight, but there was very few people that applied to join the audit. And I think the auditing side is actually the fun one, and it's very, very involved. You don't do auditing at home, you don't get homework assignments. So if any of you in the public out there were intimidated to apply to be on the Audit Committee, there's really no homework. So next round, we hope more people will apply towards that. Vice Mayor Dhanuka, I don't know if you want to talk about your nominee that you had. >> I'm nominating Dale Ball, who has been a... >> Can you turn the microphone on? >> I'm nominating Dale Ball. Mr. Dale Ball has been a longtime resident of the county, has been very active in civic life and has been a champion of government accountability and being a conservative, fiscal conservative approach. And he has I've always found him to be very direct. Sometimes people will say too direct, and but the same time has been respectful but always fighting for the citizens' and taxpayers' best use of their money. >> And Dale Small's term, if he's approved today, it will be a 1-year term. 1 year. And that will go till November 30th, 2027. So as far as how the auditing committee basically expanded, we have 1 person that will rotate in for 2 years at a time. And then I believe when the 1-year term expires, that will become a 2-year term, if I recall. So, and then, so that way we'll have one person that will join the Audit Committee every single year by design. So I don't see any discussion from Council. I'll entertain a motion if anybody wants to do that. >> Do you want to approve all of these all at once? >> Well, that feels fine. I think we can do it. >> I'll make a motion to approve all of it. >> Yeah, I'll second. >> A motion, just the audit, or are we also doing the financial? >> I would say all of it. >> All of them. >> Okay. Okay, did you guys want to talk about your nominations at all for the Financial Committee, or is that nope. >> I think the applications are in there, and I think you hit it on the head when you said that each member of council has the opportunity to appoint someone. If you want us to give a background on why we picked them, we totally can, but I think maybe the public might be interested to know why some are 3 years and why some are 1, and that is because it's based on sort of how long you're going to be on the council, and we had to start staggering them because we're starting at once, but we want staggered terms. So we did it by who's those of us that our terms are ending and those that just came on. So that's why. And then they'll it'll stagger each time. >> I would make a comment that one of my desires when we proposed this committee was to involve a wide cross-section of our community. Which includes different diverse perspective, diverse backgrounds. And I see strength in that because if you have just one narrow particular profession or a particular background, that's very narrow approach. So I do see in this committee people from different perspectives, diverse positions. So I'm very happy with that. So I have to support all of the nominees. >> Okay, did I already hear a motion? Did I miss I thought you made a motion. We will need a second on that. >> I seconded it. >> Jack seconded. All right, we are moving along. Let's let's vote. All in favor? Aye. Nice work. All right, moving along to our regular calendar reports and communications of departments, boards, commissions, and committees. We'll start with the electrical utility, item 9.5B. We're going to consider the Redding Electric Utilities Quarterly Financial Report and Industry Activities Update. Joe? >> Hi. Good evening, Mayor, Council. My name is Joe Bowers, Assistant Electric Utility Director over the Resources Division. Tonight, I have the pleasure of presenting Redding Electric Utilities Quarterly Financial Report and Industry Activities Update. So this is the quarter ending March 31st, 2026. So for the first 9 months of our fiscal year, the financial highlights for the first 9 months is we do have increased revenues. A couple parts of that: retail sales are below budget, wholesale sales exceeded budget due to favorable market conditions and market activity. Power supply costs are within our normal budgetary expectations. The variance reflects routine fluctuations in energy procurement and operating conditions. Sometimes we plan to run our plant, we turn that off, we're able to buy power on the market cheaper, revenues net of power supply costs were better than planned, which is good news. System operations and maintenance savings overall expenditures are aligned with budget projections. Favorable variance reflects timing of expenses, deferred activities, and personnel savings, what that boils down to with our cash reserves, which is, Council Policy 1414 and how we guide our financial management, is we're at 100 days of cash on hand. That has a minimum of 75, a goal of 150. We do have a max on that of 180. So the highlights for the first 9 months, like I talked about, is revenue optimization. Revenue is 1% over plan. Prudent expense management, we're 6.3% below on system O&M. When we present our financials to council, we present them I guess as a business would. So within our operating costs for running the utility, We include both the labor and the expenses associated. So when we talk about the cost of running the power plant, it's going to include materials and supplies to run it, the fuel to run it, but also the people to run it. We do break it out in this report to break it out how you would typically see in our budget book as well. But when we talk about system O&M, that's actually just running the power system. We saved about $4.6 million. About half of that was due to personnel savings. And then again, our reserves are about 100 days of cash on hand. Net operating revenue exceeded budget by 47.5% for the first 9 months of the fiscal year. That's excellent. I do want to share though it's the top line, it shows system load was flat and our total operating revenues were up by about 1%, a little over $1 million. Our operating expenses were down and so our net operating revenue was up and beat by about $8 million. It's important to note this is operating, so this is the day-to-day activities. Not included in the net operating revenue here, is about $18.5 million this year that we'll spend on our debt service. So for the first 9 months, it was about $14 million. And then also our capital outlay. Our capital outlay for the first 9 months was another $14 million or so. And then we had special fund expenditures about $2.5 million. So our net operating was $25 million, but after you take out debt, capital, and our special expenditures, our financial results for the first 9 months was negative $5 million. So the positive revenue variance, there's a few things that go into it. We don't just have the retail sales, which is what charging people for using their power here in Redding. Retail sales were under budget by about $2.3 million. Wholesale sales was up by $2.1 million. So that's the people down in our trading room on Clear Creek Road at the power plant. They optimize our portfolio and try to sell either commodities like natural gas or power, resell the power that we purchased, or actually run our plant and sell it into the market. And then miscellaneous income beat by about $1.4 million. That's about double what our budget was. This is primarily too, and it'll wane over time. We issued bonds last year, about $70 million. Those are placed in a trust account, and as we spend those down, we do pull them out. But while they're sitting in that trust account, we do earn interest on them. So we did have a beat in interest income for the first 9 months, but as we spend that down over the next year or so, that'll go away. Power cost, as, as I mentioned, power cost is below budget, about $2.25 million. Year over year, it also decreased by about that same amount. System O&M, which I had mentioned before, this isn't just what you would think of like O&M in a typical government setting. This would include everything it takes to run the the utility, was down by about $4.6 million. On the capital side, we're about 55% spent through the first 9 months, this is our budget for the year for capital was $25 million. That includes a little over $5 million of carryover from the prior year. And because many capital projects span multiple fiscal years we don't actually expect to spend 100% of that $25 million this fiscal year. Some will carry forward, but from our own financial planning and our own tracking, we're right on target, and just as a reminder, all of the capital, at least for the next year or so will be funded maybe a year and a half will be funded with those bond proceeds. And then just to point out here, special funds if you look on our financial statements online, you'll see that we've only spent about a quarter of it, at a, a couple council meetings ago, council approved a new energy procurement program which would actually allow us to use our cap-and-trade proceeds to meet compliance requirements at the state and purchase renewable energy credits. So what we'll do is we phased out actual programs you know, like electrification, charging, stuff like that. And we're going to basically, in effect, use it to pay the power bill. So that'll jump up. Here's a chart that kind of shows I talked about how we present it as a business and how you might present it in a more government setting. This is the more government setting one. You see that we actually break it apart. You have your personnel, material supplies and services, capital outlay, and debt service. So this is the first 9 months, just totally high level. You would expect to spend about 75% of each category for the first 9 months. That's 3/4 of the year. Anything below that, you're under. Any over 75%, you may be ahead of it. So all of our debt I'll start from the right, that's the simplest one, all of our debt on the right, 75.3%. All of our debt's fixed rate, so of course it would be right on plan. Capital outlay, as I talked about, 55%. Some of that will carry over to next year. Material supplies and services at 72%, so just under our plan of 75% for the first 9 months. And then division our personnel is at 68.2%. Notably that you know, our updated budget for FY26 of $46 million does include the 9 positions that we removed. I think, believe that was back in March. Just another way of presenting it, time elapsed 75% March 31st. You'll see personnel is under, material supplies and services are under, capital outlays under, and debt service with fixed rate debt is right on plan. There's a little, I guess, a meter, what you talk about. So we talked about our income statement. This is from a balance sheet perspective considering it drives our financial planning. We care about cash. Here, you'll see that our max is 180, our min is 75. This is not a perfectly designed meter here because 150 would probably be off to the right a little bit. But you'll see that we are about 100 days. We started the year with about $45 million of unrestricted cash, and we're down to about $40 million because we went through about $5 million in the first 9 months of the year. Switching out of the financials and talking about the industry landscape, wildfire is still the number one issue for electric utilities in California. Well, wildfire and affordability. But as far as major efforts to change or legislative efforts outside of the regulatory landscape, major legislative efforts around wildfire and grid reliability, there's huge news. And I'll just with CARB, so Advanced Clean Fleets got pushed out. But the one thing that's not, I guess, on here that we're really, really watching is Cap and trade. Each utility in California well, not just utilities, but other sectors are allocated carbon allowances. It's one of California's schemes to get people to get carbon levels back to 1990 levels. We are allocated allowances based on our current allowances and the current calculations through 2030. We have a certain amount. Carb release language is what's called 45-day language, which if that had passed would have reduced the number of allowances that we are allocated, which based on current pricing, which as we know with supply and demand can change. So if supply went down and they reduced everyone's allowances and everyone had to buy them, prices could go up. But reducing the number of allowances we have based on current prices, which are probably not reliable, that would have increased our cost through 2030 by several million, at least $3 million, the 15-day language actually came out to benefit us. They revised it up and to us get more allowances. That being said, not every utility is a winner. There's winners and losers in this as you start to cap it and then you start to decline over time. Not everybody's a winner. So there's still a lot of flux there. And so we'll find that out later this month, what they actually go with. And then what's neat over here on the federal permitting constraints, just because it's topical to us, we do own the generator at Whiskeytown. At the base of Whiskeytown Dam. And EPA is making more streamlined relicensing. It used to take you almost a decade to relicense a hydro facility on the waterways, and they're trying to make that much more streamlined. As you guys may remember, council approved a capital project last year for the Whiskeytown relicensing, as that's coming due soon. So just a summary here. Positive net operating revenue. We're controlling what we can control. The reserves are within Council policy. Capital projects are on track. O&M is below budget. And then from a policy standpoint, we're actively engaged in federal and state advocacy to protect customer interests. And so with that, the recommendation would be accept our quarterly report and our industry activities update. And I am available for any questions. >> Thank you, Joe. >> Can I? >> Council, any questions or Council Member Resner. >> I think that you said this very quickly, which I'm very impressed that you gave financials that quick. But did you mention that we're currently funding maintenance with bond revenue? Is that did I understand that correctly? >> Correct. Now, it's, it's, let me clarify. When I say maintenance, if we go out there and we replace a pole what we'll call that is general system improvements. From your standpoint, if you see a broken pole and we replace that pole, we are paying for that with bond proceeds. If there's an outage and somebody goes out there and they like inspect it, maybe replace a fuse, things like that, then no. If we're doing tree trimming, things like that, like general maintenance that has no useful life, we are not expending bond proceeds because you wouldn't capitalize those. But anything that you would capitalize with a useful asset, useful life we are using bond proceeds. We don't typically do that, but we are right now. We are bond funding our, what we call general system improvements, what other utilities and what we call revenue-funded capital projects for just ongoing replacement of poles, wires, stuff like that to keep your system as is. We are bond funding those. >> Is that our, just our current plan because of this situation, or is that a long-term... >> That was, yes, that was part of our I guess you would call it our strategic plan with our financial strategic plan was to issue bonds and pay revenue, pay for capital for a period of time as we could moderate any increases to rates. >> What is the, I know that our goal is to have $150 million of cash on hand, and we're somewhere between $100, $106 million or so. Do you have a number of a comparable city to ourselves of how much cash on hand somebody else who also has like inter like a utility within the WUI, that sort of thing, somebody who's comparable to us of how many they would usually have on hand? >> Yeah, we, we look at that and we also get, as part of like the rating process, we get a tool from Fitch Ratings that will share, what other cities are at. And you can drop down and look and pick size of your city, what your rating is, and all of that. Were generally lower. Going back all the way to the COVID era, what we put in place and what we still have, and we've talked about last fall, was we have a line of credit for $25 million, which for lack of a better term is synthetic reserves that we have available in case of but we pay for that to access $25 million in case of emergency. We use that and we pay, top of my head, about$80,000 per year for access to that, but that's a lot less than if we extracted $25 million out of the public, kept it in our bank account, and then they would have to go pay the cost of money in the private sector. So we think it's like a community thing that probably makes more sense. >> Makes sense. I just want to keep an eye on our cash on hand for all the obvious reasons. That's it. >> Vice Mayor Dhanuka? >> So any what happened to the plan to for proposing the rate increase? Are you still planning that? Are you, is that in the wing somewhere or the future? >> So that's a great question. So we're going through the citywide efficiency study, and so what we've done is we've put that rate increase proposal on pause. The council and city manager decided that. So we're going through the citywide efficiency review At the same time, we're going through and we're updating all of our power supply forwards. So you have forwards for gas, electricity, all that stuff that we would have to purchase. We're updating our own production cost models and our 5-year plan. And so as we get through the efficiency and anything that we learn from that, we would incorporate that and then we would present to council later this year an updated financial plan for their decision-making. >> Thank you. >> Thank you for making financial information really easy to understand. Thanks, Joe. >> All right, we need a motion to accept the city's report here. >> So I'll make a motion that we accept the city. >> Second. >> Okay, all in favor? >> Mr. Mayor, I apologize, did we take public comment? >> Well, I don't think I saw any public comment. I'm sorry. >> Okay, apologies. >> Would you like to speak? >> I mean, I just did. Thank you. Apologies. >> Okay. All right, without further ado we'll vote. All in favor? >> Aye. >> Aye. >> Okay, thank you. Okay, that passes. All right, moving on to Community Services, consider any transition funding for advance Redding and also any terms for the RFP, the request for proposal, for the Civic Auditorium lease located at 700 Auditorium Drive. Travis, you're up. >> Thank you, honorable mayor, members of the council. I'm Travis Minnie, Director of Community Services and Airports. And we have a presentation tonight to discuss, an RFP for operations of the Civic Auditorium. So a little bit of background here, February 3rd, Council directed staff to develop and issue a request for proposal for the lease of the Civic Auditorium. They also authorized $116,000 per month in funding for 4 months, which expires June 30th, coming up next month. Council had an ad hoc committee that staff met with and met with Advance Redding board members. First meeting was May 1st. We asked for a revised business plan to go over what may be a potential way to move forward with our existing operator. And ultimately in that plan in that meeting, additional, sorry, additional revisions were requested by ad hoc and staff. So we had another follow-up meeting May 11th. After that meeting, we were not able to find any sustainable model that did not require significant investment by the city. And without being able to identify a way forward, we have now come to the point in time where advanced renting is most likely winding down without additional input by the city. So after months of business plan permutations, cost-cutting endeavors, Advanced Redding's Board did not find a low-risk sustainable model that does not rely on continued funding or fits within our current financial situation. So the wind-down timeline would be dependent on transition planning and funding, if any, and we are happy to have that conversation at the tail end of this, and it is optional. But what we do need to do is figure out how we would move forward with our RFP. What would be the terms that we propose to any potential operator? And so some of these are important because they have big financial implications. So what I would like to do is go through all of those decision points and get consensus from Council on every single one so that we can effectively write our RFP and have a clear package that we offer to any potential operator. So we have to make those decisions because, again, they do have financial and use implications for the building. So we're going to go through and I'm going to tell you what we do now with the existing operator and any changes staff recommends, and then we have some decision points that require just real just input from council. >> So just so if you're going to get our consensus, would it be appropriate to get public comment now before we go to that, or, or do you want to go through that? >> I would leave that up to City Manager Tarbo on a procedure, or the mayor. >> I think that's up to the council how you would like to handle that item, whether you want to take public comment now or later. >> I just thought we might if we're making decisions right here as far as If he's getting the yes or no's or affirms on that. I think he's going to be asking us what we want to do. >> If we went through them all and we're in agreement or we negotiated at the very end, the public can comment on those things. >> Okay, fair enough. Just wanted to ask the council. >> So, okay, it won't be a vote right away. It will just be discussion and then we can do a vote. >> Okay, thank you. >> Okay, so our first topic of the evening is subletting. So not all of these are exciting, but again, they do have implications for any potential operator. So currently, the operator is allowed to sublet temporarily. We do not recommend any changes for that. However, you could sublet a small commercial space or have any kind of sublease, but we do not recommend that that be changed in the RFP or future lease agreement. And so I would ask for some feedback on that, or some consensus that you. Or we can go at the tail end and just run through. Okay, so we'll just burn through these and come back, and then you'll kind of give me the does that work? >> How about we'll speak up if we have something? >> I like that. Events. So currently the agreement is written to have 60 event days. We're doing a little wordsmithing, and we recommend the use of our 120 use days. Use days is a better terminology, more consistent with the industry, and it Essentially means if you're going to have a conference or a concert, you have load-in days, load-out days, which is kind of your setup and your teardown. And so that means that there needs to be some activity about 1/3 of the year. Utilities. Utilities are currently shared between the operator and the city, but there's a very distinct line. It's essentially indoor-outdoor. So the lawn, the grounds, that electric and water is the city's responsibility, and the interior so the power, water, sewer, and solid waste that is the operator's responsibility. We do not recommend any changes with that. Maintenance, similar lines are drawn, we have interior maintenance, which is performed by the lessee. It's generally the lower-level, tenant-level maintenance. all major stuff is performed by the city. We do the exterior of the building as a city, major mechanical, so that's your HVAC, elevator, windows, landscaping, parking lots, roads, major plumbing, things like that. We do not recommend any changes for that because that's very typical tenant and landlord arrangement. Monthly rent currently the agreement has a $5,000 per month rent However, there is a rent holiday which is in effect through June 30th. We recommend that you do not charge rent for the next proposer because we do believe that it is a very common model and that we may run into this with future proposers that they actually request operations and maintenance funding. So we want to leave that open. And it's a little awkward to pay on one side and collect on the other, message popped up here. Sorry, that was interesting. Parking lot use. So no charge currently to the city's fire department for training. Understandable, it is our parking lot. But what we would like to add, our recommendation, is the ability to charge for parking. We do believe there is some revenue that can be captured should the operator choose to, not be compelled to, charge for parking. So we'd like to provide that in the lease. It's not currently delineated. Natural disasters. So the operator should understand that currently the city may occupy the building during an emergency or a natural disaster. So think car fire, major flood, things like that. We can use it to shelter, we do not recommend any changes, but again, we do want to make sure that they are aware of that, could have show implications or event rental implications. So they would have to write that into their contracts. City free use days we don't use a lot of these, but it is in the agreement that the city is permitted to use the premises for municipal purposes without obligation to pay rent, but it cannot interfere with the lessee's use. So what that means in practice is that we're allowed to use the building, but if we're taking up a show day, they can still market that day. So we have to pay anyway if we really want to be firm and hold our date. So we would typically reimburse for utilities and staff time and then hold that date. We do have cost in that day, but we don't exercise that too often. Most recent one I can think of is City Fair, which is a new addition to our event schedule, but we do rent the facility during that time. We do not recommend a change for that because we do not want to jump in and kind of mess up the schedule. So we'd like to be able to use days if they're available. And pay our way if we need to. O&M budget. So there's no current O&M budget for an operator of the facility. So this has been the request that we've heard several times from our current operator, that they would like us to set a budget for them to use to operate the facility. However, we recommend in the RFP that we allow the proposer to make a request for a compensation or O&M dollar amount That way we're not dictating the terms, and we're essentially seeing what the services cost, if anything, from any potential operator. So that would go into the scoring of the overall RFP criteria. Special events this one will require some discussion. There are several special events that are baked into the agreement. these are priority scheduled days, so these come before any other event. If Led Zeppelin gets back together, it will not interfere with Cool April Nights. That is essentially how the agreement is, is set up. So we have all of these events listed here, and we will have to essentially choose which ones we want to bake into the agreement. Does not mean that any of these events go away. It means that their priority of scheduling can be lowered and that we will have a different relationship with those events with any future operator. So right now we have Cool April Nights, Redding Rodeo, 3-on-3 basketball tournament, Turtle Bay auction dinner California Deer Dinner, Memorial Day ceremony, State of the City, July 4th Freedom Festival, and one other 2-day weekend requested by Redding Rodeo Association, provided it's 6 months in advance and the weekend isn't booked. So what we would propose for that is to limit these future obligated events to ensure a more competitive proposal cause this is a lot of days to tie up. We would also recommend that the Redding Rodeo days be defined as a set period of time rather than the time in which the rodeo occurs. It doesn't mean that we have to dictate dates. It means we have to dictate a schedule. And so I'm happy to, we made a suggestion here, but I'm actually, I've reached out to the rodeo and haven't heard back yet, but I would like to solidify those with the best dates that work for them. So that we're kind of fair across the board. Currently, I believe the Civic is dark for about 2 weeks from programming, but we think that that might be a little bit overkill. So we want to make sure that we work with them to get the exact days they need, nothing more, so that the potential future operator can have the most flexibility to have the best commercial success. Maintenance is actually just in here twice, so we don't have to have that conversation again. It's amazing how many times we looked at the staff report or the PowerPoint and no one noticed, so, I'll own that mistake myself since I made the PowerPoint. Some other pertinent RFP details: there are a lot of city-owned assets in this facility. We are going to our, our current operator does conduct an analysis and an inventory of the assets, with their condition noted and everything like that. We're going to refresh that before the RFP goes out so that the potential future operators know exactly what is included with the building. And another important point is that the RFP requires, or will require, a statement of finances to ensure the potential operator can fund their business without relying on the city as a risk partner or providing an upfront operations budget. This means that should they request an O&M budget, we are not bankrolling events ahead of time, that they are actually able to operate the business on their own and take payment in a monthly schedule or whatever we end up contracting with them to do, so that we are not the risk partner up front for a startup. So we want to make sure that we have an operator that can come in and take care of business and pay the bills from day one. So we think that is a pretty it's a bar to clear to make sure that we have serious business partners that want to engage in this operation. So next steps from here. Would be to conduct that full inventory and then issue the RFP. And we have a draft timeline, which I will admit is aggressive, but, we would like to get started right away. And we do have at least a month or two, on the tail end that we know can get stretched out a little bit because contract negotiations can always take a while. And depending on who you contract with, they could have a whole team of attorneys. And so we wanted to provide a little extra time there, but this is in general what we think that timeline would look like. And so with that, I'm able to take any questions for now, or we can jump back into public comment. >> Okay, how about we take public comment and then we'll go back to questions, if that's okay? So we, we'll we have Todd Jones Leslie, and Michael Quinn, three speakers. >> I know this is not how it works, but I was kind of hoping you guys would ask more questions first and then I could kind of read the room a little bit. >> That's okay. >> It's okay, good evening, council and staff and public. My name is Todd Jones. I'm the CEO of the Reading Chamber of Commerce. We also run Visit Redding. I have so many thoughts. I did write them down. I'm going to try to do my best to kind of stay on point here. You know, we you, you are all faced with a very tough decision tonight. The Civic is a great asset to our community. I wrote in a newsletter on Monday, this is something we've seen coming for about 16 years. Advanced Reading has I mean, Advanced Reading basically bailed out the city 16 years ago. We were in a very similar situation. They did a great job of doing it, and now we're back here where we're at, where we're faced with a really uncertain future. Let me get back to my notes so I don't really go off the rails here. So I, I, I think looking through this RFP process, there's a couple issues that I see. The building is really a tricky building. Advanced Reading knows the industry, they know the building. The building isn't exactly, I think, what we would like to see in a modern day. I mean, they've done the best they can, but it doesn't really fit conventions and a lot of things these, these need, the industry needs right now, or our community. The other big thing that I think keeps I keep hearing, but I don't really hear in the public that much, is I'm not sure what sane operator is going to come in here and say, hey, we're going to take on this building when the city has a landlord to my knowledge, cannot fulfill their obligations to even fix the HVAC, which is estimated to be about $5 million. So who's going to come in here and say, yeah, let me take this on? If Advanced Reading can't do it, I really don't see somebody else doing coming in with all the information that they have, the way that these are modeled all throughout the country. I know Julie's talked about this up here and many other places where these are subsidized to provide the economic impact, which I believe the Civic does provide to our community. But I think with current budget situations, I don't think anyone's going to respond to the RFP. And unfortunately, I really feel like, as much as I love the Advanced Writing team, I just don't think we can do it right now. I think that we are going through this efficiency study. There's a lot of things that are really pertinent in front of us right now. And as much as I would hate to say it, I just don't think in 4 months we are not going to be in a better situation. I don't believe anyone's going to come forward, certainly if Advanced Writing can't figure it out. I don't think anybody else will either. and it's hard to say. I think we need to really come up with a long-term plan. I think there's one out there. I don't think the Civic should be demolished. I think there is a future for the Civic. I think there's a future for the riverfront. I think there's a future for more cohesive tourism development in our community. But I don't think it's going to come together in 4 months. Hopefully it will in a year or 18 months or 2 years. But I don't think it's going to happen right now. And I think this is really one of the first of many hard decisions we're going to have to make because We've been kicking the can down the road as a city for decades, and at some point we're really going to have to make a tough decision and think through some long-term strategies. So it's hard to say because I love the Civic and the team that's done such a great job for years, but I think that's what we need to do. So thank you. >> Perfect timing, Todd. Leslie, you're up. So it's all good. >> Sorry, I'm short. Okay, so since Advanced Reading saying they can't do it, there's really not a need to go into a lot of negativity. I will say that I've heard statements online by different individuals across the board. Well, we didn't want to make things political, or we didn't want to make things a polarizing issue. There are two situations where that was done by Advanced Reading, and that's the only negativity I'm going to get into. And that's one, pushing the sales tax initiative. If you don't want to make things polarizing or political, don't back something that large and then expect the city and the constituents to be happy with giving you free money. And two, There was an individual who I was friends with who is not part of any of our political class groups, initiatives, anything. She is just a mom trying to do her thing, and she tried booking the Civic for a large-scale event. Unfortunately, due to the political climate and culture and chaos after Charlie Kirk, it was canceled due to some security issues, death threats, that type of thing, which is unfortunate in the world that we live in. But she has nothing to do with local politics. When she went in for her meeting to set everything up, whoever it was she was meeting with I know, and if you want to know, we'll have that conversation based on two of the speakers, namely Chris Street and Kevin Crye, she was treated so terribly and with this just abstention that was ridiculous. And she called me and she's like, I don't understand what I did wrong going into this meeting. I presented what it was we were doing. I showed I showed her who our lineup was, I showed her what we were doing, and all of a sudden she was just so mean. But in my previous meeting, she was so nice. And I said, well, it's because you showed her your lineup and these two people were on it. When she went in for the next meeting and she explained that those people, she's not tied to any of this, anything, they backpedaled. Oh, we're so sorry, we love Charlie Kirk, we love what you're doing, this is great. Even started crying. About how the tax initiative, if it doesn't pass, they're all going to be shut down. And it was just the most unprofessional experience for somebody outside of our area to experience. That might be part of our failure, right? So just that experience, along with backing such a polarizing tax measure, might be part of our problem. I'm glad it's going to RFP. I don't think it needs to be demolished. I think there's great established community events, and for years this has been something that's functioned well. So I hope we can figure it out. And again, let's start deep diving some of this chaos and misspending, because we might have a solution that might not cost the city as much money. Because guess what? Bottom line is there's no money, and continued bailouts is an absolute no. >> All right, Michael, you here? >> I'm going to change a little bit from what I originally wanted to say because of some of the things that have been brought up now that I didn't know. I went through the financials to see what was wrong, and I found a number that just stuck out in the number We're looking at a loss in physical year ending '23 of $25,000. Next year it was $425,000 loss. The next year is $1.3 million loss. Well, you can't there's something wrong there. So I started combing through the last number and I found the exact number, and it comes under the program services, which is basically the amount you're going to get in for concerts, things like that, versus their cost. And in the year ending '24, it was they made $4.6 million in income, $3.5 million expense. The next year, $100,000 more in income, but $880,000 more expense. Literally, that is the number that you're going across from $425,000 to the $1,300,000. It follows through. It's, it's the amount of cost that you have in putting concerts and things like that on. So, where do you go from on something like this? You've got to make things profitable. When you put an RFP out there, someone's going to have to know that they're going to change what's going on, how much they're paying, because that's your cost. It's, it's going to be very, very evident that what goes on the city used to run it. The city used to run that. They had 3 people. John Gorman, Peggy Hughes, and Patty, and that was it. But you could bring in your own show. I did. I brought in my own concert. Didn't make a lot of money on it. I probably lost a little bit, but it was up to me to have that cost. They didn't have to do it. They gave me a rent for it. They did the say, we're going to do your tickets, we're going to do this, we're going to do that, security, all that stuff. Was provided at this cost. So the city knew that they could make money on it. I took the risk, and those things went away. We had the Chicago series of plays that was here Cats and all the major plays would come to town here but they took the risk. The city didn't. And that's the one way that you handle this, is you whoever's going to do the RFP has to be given the opportunity to let everybody else come in. That's going to be their decision. But this is something that it's just very evident when you read these numbers where the cost was and why it got to where it was. Thank you. >> Thank you, Michael. All right, Travis, you're going to come back up. And Councilor Resner, you got questions or comments? >> Is my name still out there? >> Oh, it still is there. >> Do you need us to go through your slide that is RFP decision point special events? And if so, what do you need direction-wise from us in terms of, which ones we're saying you need to specifically, keep available? >> Yes, we would like to know which events we would like to bake into the agreement None of these events have to go away. I am not saying that at all. It is which ones have a set date, a clause in the actual contract that says you will have the Freedom Festival at this venue, because those are restrictions on the use of the building that ever it's like if you have a vacation or you have a rental house and you let someone rent it and you say, well, but I'll be there Christmas and spring break and all summer, so you got to get out. So we have to make sure they're aware of these things. And so I would like some direction on which ones we would like to bake in. For example, Cool April Nights, Rodeo, Fourth of July are very common events that we have kind of baked into the culture of Redding. And those are ones that stick out in my mind. The others are optional. >> I would say 3-on-3 also feels, maybe just because I grew up here, also feels cultural to Redding, and then Memorial Day, and both of those are only outside. >> I didn't see Ironman on the list. Is there a reason we should do that since we have a contract for 3 years? >> It's not in the existing lease. We can certainly add it. We have a 3-year commitment. those events typically run longer, but you could add it. >> Question. >> Great input. >> The question I have about this is, do these groups pay any rent to the Civic? >> Yes, they all pay amounts. We do not. For the Freedom Festival, we pay for our services, but they all have deals worked out with the operator specifically on what costs the event is able to actually pay. Okay. And Advance Redding is actually very good at understanding what the overall impact to the community is and kind of seeks the positive message in some of these events too. So they're very fair with those costs. >> July 4th doesn't get charged. Anything else, they can charge the vendor, right? >> Yeah, our you could say in the agreement, our uses will not like Fourth of July does not have a charge to it. >> Okay. >> We pay for their staff time, right? And