City Council

Mayor Cal Sheehy Lake Havasu City Vice Mayor Michele Lin Council Chambers Councilmember Nancy 92 Acoma Boulevard South Campbell Lake Havasu City, Arizona Councilmember Jeni Coke 86403 Councilmember David Diaz www.lhcaz.gov Councilmember Jim Dolan Councilmember Cameron Moses City Council Budget/CIP Overview Work Session Minutes - Final Thursday, April 10, 2025 9:00 AM One or more councilmembers may be participating via remote conferencing. In accordance with A.R.S. § 38-431.02, the public will have physical access to the meeting place fifteen (15) minutes prior to the start time as noticed on the meeting agenda. Lake Havasu City endeavors to ensure the accessibility of all of its programs, facilities, and services to all persons with disabilities in accordance with the Americans with Disabilities Act. If you need an accommodation for a meeting, please contact the City Clerk at 453-4142 at least 24 hours prior to the meeting so that an accommodation can be arranged. The City Council may vote to hold an executive session for the purpose of obtaining legal advice from the City’s attorney on any matter listed on the agenda under A.R.S. § 38-431.03(A)(3). 1. CALL TO ORDER 2. PLEDGE OF ALLEGIANCE 3. ROLL CALL Diaz - remotely Coke - will join shortly Present: 6- Mayor Cal Sheehy, Councilmember Nancy Campbell, Councilmember Jim Dolan, Councilmember David Diaz, Councilmember Cameron Moses and Vice Mayor Michele Lin Absent: 1- Councilmember Jeni Coke 4. BUDGET OVERVIEW 4.1 Presentation, Discussion, and Potential Direction to Staff on the Budget for Fiscal Year 2024/25 (Year-End Estimates) and Fiscal Year 2025/26 Annual Budget Knudson - welcome and overview - new materials Olsen - timeline Fiscal Year 2024-25 - how are we doing? budget to actuals carry forwards Lake Havasu City Page 1 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 available resources - transfers out - general fund to HURF for streets ($5.5 million) general fund to CIP - and under $1 million for Downtown Catalyst Projects. BSR amount is not included in numbers above - estimated June 30th GSR will be just under $33 million Budget overview projected revenues - property tax - tax levy & EMS revenues water and ww revenues - tracking to make sure we are receiving about of revenues projected during study improvement district #2 - LB Plaza - utilities and landscaping contract - proposing to leave the rate flat - no requests from district property owners or staff to change that - FY 26 expenses exceed revenues by $1,500 - fund balance of $12,000 able to absorb that at this time. Expenditures - adjustments - implement compensation and classification study step and wage adjustments changes to retirement rates - ASRS 12.27 to 12.2 - PSPRS Fire 3 percent decrease overall average - PSPRS Police 3 percent increase overall average. included the health insurance rate increase - average of 5 percent - included those costs at the higher levels - salary savings due to vacancies - supplemental requests (after base budget - line item budget - one-time items - look at each carefully - requests put forward as a supplemental request - $21 million received and $13 million general one-time not ongoing - tentatively $10.1 million has been tent approved - HURF under .5 million - water $3 million and ww under $2 million. $1 million in contingency budgeted. Moses - carry overs for ww and water - estimated actual expenses Jill - yes carryforwards reason for less that budgeted expenses Mayor - property tax rate flat as proposed - interested in keeping flat - consensus from council (including Diaz remotely) Diaz - health insurance rate increase - provider dollar amount. Jill - varies depending on what coverage employees have - included at the average rate - 5 percent. salary savings due to vacancies - not going to be saved throughout the year - Jill - normal times - we typically still have vacancy savings - average anticipate savings even under normal recruitment times Knudson - overview of CIP Plan - grants, resident requests - council requests - reflected in this plan - this is a draft budget - need council input. Ron - CIP FY 2026-30 - work involved. road map capital projects. fluid and watching closely - master plans looking at projects that will need to be done in 10 years. strategic planning document - timing for some of the projects. accomplishments in 24-25 questions from council 24-25 - none continue on CIP 24-25 projects - AA and main street commons - and island path repave General Fund - City fuel facility - June 30th completion - PD Facility and Jail Repair Lake Havasu City Page 2 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 Phase I completed. Lin - $2million in CIP 24-45 - but in presentation states $3.575 million Dolan - FY 26 is 25-26? - yes Olsen - $3.575 million in adopted Knudson - explanation of funds and donation of funds dollars identifying not funding sources Lin - WIFA LWCW - $1 million and $ 1 million received Yes Moses - funding for the CIP - 25-26 General Fund funding - $12 million - how are we projecting such a big number. End of summary - grayed in area - Mayor - general fund look over Moses - funding projections are accurate - do we expect Jill - carryforwards from 24-25 - Moses - anticipate carry forward in 25-26 - fund balance - about the amount for construction sales tax - total general fund funding that we can anticipate Mayor - projected out for next couple of years - $7.6 million current year - 3-3-5 years hard to project. Knudson/Ron - fluid document - five year outlook but years one- and two look at completing. generally $7.6 million and this year $12 million. Knudson - dollars coming from general fund - roads/source into the CIP as well. one time movement into CIP for specific projects. Jill - 26-27 - 4.6 million is the fire station 7 funding. large part of that general fund total for that year. Diaz - clear breakdown of DTCP - over 90 percent of park paid by grants. what is grants/received/projecting? 26-30 plan - general government is almost $5 million. what is the breakdown - received - Knudson - CIP revenue - expense side - breakdown previous years and into future years. $2.7 million spent on construction cost $400,000 design cost $900,000 program budget was not spent on budget - outside dollars spent $1 million ABC winnings - $1 million from AZ State Parks, and WIFA grant $700-$800k - balance - plan is for council moving forward - bathroom/concession - want to do more we can or stop - input from public and council next steps on project - dollars available if council chooses. Diaz - general government and not under parks? Jill - requested under general government - we did not know it was going to be a park. Lake Havasu City Page 3 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 same place. could go under either category and would not change any of the numbers. Lin - $3.75 million - 3.775 spent and did not include bathrooms and amenities, bridge - Mayor - what council approved is what council has today - development of that. todays book - confused with numbers. $3.7 - thought we are getting - more money today to finish the project. Lin - do not like description Campbell - Jamaica boulevard south - infrastructure Ron - mill and fill - no infrastructure project Knudson $ 5million identified in CIP each year - Campbell - design Jamaica meets far to the south at LH Avenue - up to Chemehuevi = Campbell - how many breaks on those roads? would like to see documentation. Ron - sewer is not under pressure - do we have collapse or infiltration into the system. water has pressure which is why we see breaks. Campbell - just the water. Campbell - water overview - general plan identify the areas. do not want to mill and fill if we do not address infrastructure at the same time - bike path sidewalks etc... Ron - will repair water line where it makes sense - do not want to dig up new pavement. Campbell - water line on LHC Avenue Lin - new laboratory $800k last year - design and construction. Ron - $58k - difference of $750k moving into new budget Ron - site work, utilities and submitted to DSD for review. Campbell - VLT and gas to pay for roads? Jill - general fund and transferred into CIP street projects. 20 percent Campbell - why are we not using VLT for roads Knudson - no requirement to use for HURF projects/roads - 0 percent years ago - and now 20 percent is going into HURF - ongoing revenues to fund HURF operations. we can take a look at that further - no requirement - but started a few years ago. ADOT represents that we are getting funding - $20 million - VLT and gas tax needs to go into roads expansions - why we are highly underfunded in roads. misrepresenting our city - for roads 20 million would be substantial amount - government is taking HURF funding and putting into General Fund. Mayor - roads across AZ are underfunded - if this council wants to take a different source. to give continuity and certainty - 20 percent of VLT and gas - all the rates - move the throttle based on where we are today - where we mapped it out - not misusing the monies - take it from the GF - have to make up the GF dollars. Campbell - go to meetings ADOT and State Transportation - VLT almost as much as HURF funding - state adds both of those to run ADOT - always thought that LHC roads look so bad. how far above storage units and garages - vehicles - fuel tax - gas tax - roads Lake Havasu City Page 4 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 - whole concept only taking 20 percent. rest is going to GF. state did that before - swept the funds - jeopardize someplace else - roads was the top complaint in community. Mayor - next budget work session - analysis of VLT not sure if it is the same - VLT - traditional HURF. returning our money that we already paid - breakout - and general fund appropriation. next BWS. Moses - broke out how much money that is? $20 million Jill - $5 million - 20 percent is $1 million Campbell - would love to see whole amount put into HURF. Jess - ongoing versus onetime Campbell - paying for roads - taxpayers fair - all money should go to maintain operations and maintenance Ron - Aqua Design International - start a design - council approval on 4/22 - quite a bit of homework done - materials - bring it in at budgeted level of $2.5 million - based on estimates short of that but working on numbers. Campbell - pictures of pool area Mayor - $2.5 million in budget to come forward with plan Campbell - voting no on it - 25 meter wide pool in location Campbell - Moses - organization got support - found donors - it is not us. finds support within the community. Campbell - they have - tried - emails Campbell - key players - more involved - last Tuesdays meeting. Mayor - not upset - if we do that - why would we not entertain - simply do that - elect to do that - staff on Tuesday - discussion/feedback is great - misrepresented involvement - allocate funding for it. if we are going to do that - no issue with them working - back to where we started - not moving forward until there is a plan in place. carry forward. Campbell - recommendation 3-acre park on Island - swimming pool, shade, everything pool company - $1 million - let community get involved to build something better. mixed messaging. 5-years - can you give me a week and call designer people - or call local contractors. Mayor - $2.5 million in budget - keep in budget for next fiscal year. Dolan - $2.5 million in budget - people want to stand up - come to table to get it to the next level - trust you and give you time. so much negativity - do it in a positive way proper way Campbell - did not know until 50 meter until lunch the other day. Lin - clarify - staff feels that I threw them under the budget - I did not. more work on getting prepared for some of these projects - not as much work on the pool. work that was done today - not enough prep work. meeting Tuesday was a prep - need to stop. missed was a work session. PRAB - CM - staff - was a lack of communication and progress in Lake Havasu City Page 5 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 this. PRAB has not had an update on pool in last year. constituents and councilmembers - calm way keep in budget - bring all stakeholders together - get the project done Mayor - Dolan, Campbell, Lin and mayor - directing staff to keep in budget - do not bring the contract on 4/22 - wait to hear from councilmember Campbell, Lin and Diaz - Lin - every councilmember and work session Diaz - work session and break on this project. $2.5 million - resources to table - work session build a product to address issues in future. plan for future. Moses - users that need to get the coalition together with CM - not sure much can come from work session - cannot make that plan. this was what I was alluding to to the coach at the meeting - public is willing to achieve - $2.5 million - nothing - we can build this - if they want to get together to discuss. Lin - they did try - unanswered emails. ones last minute. to tell them to come back to staff - work session. need to let the public - so they do not get unanswered emails. Mayor - $2.5 million in budget - break on design contract - explore opportunities with CM. Campbell - consider location and not sure what will fit on location. piece of property - extension of aquatic center - grow with community. Mayor - open and see what the donors and community. Dolan - to put on hold - we have a couple of months - design company - better plan would love to hear from people. if those people want to help we are supportive of that - love to partner. Ron- reviewed the remaining projects CIP Mayor - CIP overview - 5 year outlook Campbell - square footage of Airport Hangar Ron - design contract - infrastructure only - not hangar Knudson - Airport Manager will work with others on development of hangars in area - seed money to start process of developing hangars to continue to build more hangars. self-sustaining - general fund dollars allocated to airport. infrastructure and asphalt for development of hangars - continue down the path. Campbell - ADA accessibility park - bid of asphalt, conduit, etc... Ron - $1.3-1.6 million Campbell - going to do parking lot and curbs Ron - ramps and sidewalk and some of the west end parking lot by channel and bathrooms. build restrooms. Campbell - concerned about the overall price tag Campbell - London Bridge parking lot in CIP? in budget? Knudson - yes in operating side of the budget- goal to get accomplished in next couple of months. on radar and hoping to get done in this fiscal year or beginning of next fiscal year Campbell - city hall parking lot repair? Knudson - a lot of parking lots that have not been maintained want to continue with Lake Havasu City Page 6 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 available dollars in budget. challenging with shade structures. Campbell - PD facility training center $2.5 million put into parking lot for City Hall. $7 million for remodel - would you want to pay $1 million or concerned with parking issues. Page 27 - Mayor Campbell - $1.2 million workout facility - remodel - allocate money to parking lot. Ron - Fiscal Year 28-29 funding. committed to tackling parking lots. City Hall is on the radar. list of parking lots. Campbell - not for building splash pad at the park or restrooms at the channel. Would rather see money to DTCP. Dolan - would like to see partnership for hangar development - thanked staff for putting together - work with what we have - do not want to borrow money. have to work within means. everything is important. do not want to raise taxes and want to work within what we have. Diaz - thanked staff - airport hangar C&S program development Page 17 - Main Street Commons $80k construction management Ron - contract to build - Construction Management made up of three engineering design - maybe 2 - architect - DIG and then the engineering firm Michael Baker International - help with that - $80k Yes Page 21 - Outdoor Pool - would like to hold off on $2.5 million and would like work session with stakeholders - Page 22 - ARPA Funds - Fishing Dock - donations - yes Page - Fire Station No 7 - built? 3rd quarter of 2026 - is it 2027 Knudson - timeframe is the end of 26 - beginning of 27. we identify the cost for FS 7 2 years ago - design team and CMAR under contract - we are going to need an adjust for FS 7. Annual staffing cost? Mayor - Page 23 - personnel costs - staffing 6 additional FF - overall staffing to 26 for all stations. Page 29 - Second Bridge - successful with Parks to move bridge over to save $$ Knudson - plan/requested approval and with State Land - hopeful for approval. Page 35-36 - ww and water utility - can use WIFA grants? Knudson - always looking for grants - Page 40 - effluent - upgrading system to remove chlorine Knudson - salt content - (sodium) - zero plans for infiltration system - look at end users - great strides with Havasu Golf Club to address effluent - no plans. Diaz - Second Bridge - $35.5 million - actually spent $2.4 of the money allocated. Ron - we have not spent a lot at this point on design. we are not even at 30 percent - we have not spent $2 million Diaz - $33.1 million Page 29 - Mayor $35.5 million - Diaz - 3-4th page - Lake Havasu City Page 7 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 Jill - $33.1 does not include current year - explanation Lin - Page 3 - hangars - getting it ready to prepare if we want to place hangars - how long to recoup money. Ron - explanation of hangars - market - sale/lease depends on size of hangars. ensure development pays for itself. Lin - MS Commons - $1.8 million from last year - Knudson - carry forward from previous years Lin - what we have spent to date is $2.7 million - identified outside dollars. Lin - channel restrooms - additional money that would be added to the ADA money? Knudson - similar restrooms to Sara Park Trailhead Lin - two different bathrooms Mayor - location of the bathrooms - Mayor - Page 20 - ADA Accessibility and bathrooms Lin - do not support. Lin - outdoor pool - operation expenses page Lin - lifeguards - full cost of an employee Lin - Page 26 - training facility PD - wants/needs - FY29 - cannot support Chief - training room - we have an offsite training facility - simulator - mat room defensive tactics/makes sense to have that facility on our property. classroom portion in training we can do instruction on the mats versus another facility. Lin - water lab - Lin - court house Coke - defer today. Moses - middle of road - general parks plan coming up. when we get results back - unofficial data going to need some ballfields - radar might end up needing to be put on for future CIP years. Mayor - a lot of work - colleagues passion for city. projects moving forward. tasked with job to bring together but could not do that with city team. quality of life - Public safety - infrastructure - projects - investments in future. goal of CIP support direction as a community - items will come back to council. flexibility based on needs of the citizens. Page - summary spreadsheet - timing of project - Page 25 and 27 - PD parking and rehab. Chief - enclosed garage - area would not affect the parking lot - separate area that is unimproved. Mayor - budget work session - we have some unencumbered funds - taking $11 million - $5 million to roads move Acoma up - programming and move Acoma to the next spot - $6 million for staff Station 7, Parks for second pool and/or ballfield improvements. Lake Havasu City Page 8 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 Lights at SARA Park - blind spots and color out there and grant to Marine Corp League for USS Relic - looking to build a memorial - consider $100k to make project happen available and ready December 7th on Pearl Harbor Day. staff to bring back at May budget meeting Lin - $900k - grant - own item. MSC own item in budget - flexibility to fields/pool - separate in parks and rec Mayor - great ideas - investing in roads and infrastructure and parks. supporter of the relic and memorial - community asset - tourist - beautiful part of community - $100k support it. Campbell - support with improvement to parking lot. Campbell - septic tank - Guy Reynolds - own containment - no leach field for contamination. OP Bonny Toy - work session for outdoor pool - budget and amendments - is code enforcement processes - work session for code changes and zoning changes. Tim Murray - progress to get better - surfacing material is interesting - great job - managed well. extend the life of the road. lighting improvements for Rotary Park are somewhere - glad to see it is moving forward. CL Present: 7- Mayor Cal Sheehy, Councilmember Nancy Campbell, Councilmember Jeni Coke, Councilmember Jim Dolan, Councilmember David Diaz, Councilmember Cameron Moses and Vice Mayor Michele Lin 5. CAPITAL IMPROVEMENT PLAN OVERVIEW 5.1 Presentation, Discussion, and Potential Direction to Staff on the Five-Year Capital Improvement Plan outdoor pool - on hold for now Station 7 - identifying dollars for that Parks Master Plan - tie some future dollars now to future ballfields in LHC $5 million for roads Lights at SARA Park - and also Rotary Park? clarification: splash pad - channel restrooms - PD training facility - Lake Havasu City Page 9 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 Mayor - support all three Moses - support all three Lin - no on channel restrooms - no on PD training facility Knudson - right of way agreement - cannot build restrooms Diaz - Dolan - support all three Campbell - concerned with water splash pad Reynolds - recirculation tank - a lot less mitigation and some evaporation - pretty sound system. Campbell - do not support splash pad outdoor pool - 25x25 - asking splash pad and channel - stay pool - uncertain Diaz - work session - scheduled and move forward Mayor - Tuesday - move ahead - today hold off Moses - support work session - meeting with commitments first - see what true level of commitment is Lin - Mayor - keep $2.5 million in budget Campbell - do not want to hire a design contractor Campbell - site plan - email to us to say if it fits or not Lin - Moses - how are we spending money until July? Knudson - funding - FY funding source - identify $50,000 of $225,000 contract. Campbell - $225,000 is a lot Dolan - want to have this 25/26 budget - staff has been doing. respectful and careful - a lot of those meetings have happened - careful how we pick at things - whole thing - teed up to ready to go July 1st. keep it going - love the partnerships but have until July to make the decision - when we have the budgeting - breaks on the passion - staff is doing what they can. fit there etc.... $2.5 million to stay meeting in month? Campbell - pump the breaks one month come back with discussion item or design contract CM report - behind the scenes items on projects to keep everyone informed. Lake Havasu City Page 10 Printed on 5/16/2025 City Council Minutes - Final April 10, 2025 month - some sort of discussion Mayor - fairness to everyone - budget started on July 1 - direction with no money - misunderstanding - moving forward and talking in the same room. one citizen Call to the Public changed all of these things 65,000 in last year. Knudson - collective concept priorities of residents and community - efficient - beneficial - going in right direction yes - local government process do our best - thanked the team and council - great things this year and next year. Campbell - a lot of projects and not a lot of project managers - looks like going after staff - not intention. apologize - really concerned to put in budget ASAP with no vision/direction. 6. ADJOURN 12:54 p.m. Lake Havasu City Page 11 Printed on 5/16/2025