Work Session

Welcome everyone to the December 11th work session. And at this time, I'll turn it over to our deputy town manager, Russ. And

clicker.

Oh, we need a clicker. There you go. Jenny's going to do some of the upcoming agenda.

Yes. So, um, just adopted your 2026 schedule and we are now going in the process of going through and updating your calendars for these, but here are your upcoming meetings. Um, we'll make sure we're double checking everything that's on the calendars and stuff like that.

All right, and we'll turn it over to Scott to talk about South Hills Municipal Service District.

Good evening, Mayor and Council. Glad to be here tonight to talk about South Hills. So, tonight I'll break this uh conversation up into three different sections. First, I'm going to give an overview of South Hills. I know a lot of us have thought about it. Maybe it's been a little bit since we've discussed it, so I thought I'd do just a brief overview. Then, I'll talk about municipal service districts as a whole and finally talk about the South Hills request. There's nothing for you to do tonight. This is really just to bring you up to speed on where we are, what the request is, and some actions that will be coming forward. So, we all see South Hills. It's right next to the interstate. It's in a great location. Um, it's broken up into two different sections of the resoning. 12 acres on one side, 32 acres on the other side. South Hills was K's oldest mall. Um, construction began in the 60s. It opened in the 70s. Expansion happened in the 80s. And the current state of South Hills looks kind of like this where you've got a lot of parking. Sometimes there's not a lot of people there, some older buildings. And so, um, and in fact, when we looked at it, over 400,000 square feet of buildings, 1,800 parking spaces,

close to 50% of this site is surface park. So, if you think about from a planning perspective, highest and best use, surface parking is is not what we would expect in this area close to a highway in our destination center. Good news is Loen and North Pond purchased the property. This happened in 2021. We've got some of them here tonight. Um we they started the resoning process. That resoning process went through 2024. Uh went to planning and zoning. Council, you made a some of you made a decision on to reszone that property uh in October of 2024. There is a development agreement that's ongoing. And so we are talking through how like just like Fenton, how would we help? could we help um through things like maybe infrastructure make this project a success? And so that's we're beginning those conversations. That's not what we're talking about tonight, but it's sort of adjacent to that. I'm going to say it because it is part of the conversation. We had an idea for a sports and recreation community center. That was um part of the 2024 parks recreation bond. The citizen voted against that bond. We are not moving forward with a community center. Although what a great picture. [laughter] the preliminary development plan. So, what would South Hills eventually become? Really, the one of the most important things of that is it's a grid network. So, this is kind of that walkable mixeduse concept. [snorts] There's a pedestrian way. The Dutch word wounderf was learned, I think, by many of us. So, you could have a street where people could walk through um throughout weaving through the center of this site. We had activated ground floor uses. So when you see the retail on the ground floor, things you could actually walk and go see. Above that, there's a ratio of um of of more different types of uses, there's a ratio of non-residential to multif family, so that you you in the conditions of the resoning you approved that you would always have a good mix of both commercial and residential. There

was also a commitment for 5% of the units to be 80% AMI for 30 years. Building heights were broken out between three zones and I think the tallest makes sense. The tallest zones up to could be 23 floors um next to the highway. And this district, this resoning case had a lot of unique standards, things that made this special, particularly architecture, public art, um how we do development plans, how the streetscape would look really similar to what Fenton um did. kind of taking on that Fenton example and expanding upon it slightly. And the final piece I'll talk about is reuse redevelopment. It was always envisioned that portions of the site we might keep the developer might keep the existing buildings that are there and then reuse those while they work on other sections. So section three was the section that the most reuse and redevelopment was scheduled to take place. And if you've paid attention to the news, the carrot cal hold on the Carolina Ballet has announced that they are working with the South Hills developers to move some of their um uh hold their the things that they do into the old Ford building, uh Ford dealership building. It's 1300 Buck Jones Road. So things like a studio, a classroom, costume shop could be part of that. Um you know, they're working to raise money. So uh just that's that's out there. We're not, the town's not involved in that, but certainly very supportive and seems like a cool use. The other side of that could become like a food hall type use. Again, these are ideas, not necessarily plans we're reviewing at this time, but just thought that was worth mentioning. So, questions on South Hills before I go into the municipal service district, why we're here tonight? Nope. All right. So, municipal service districts, what is it? So this is a place that and we get all these this authority from the state of North Carolina. These are places where a municipality can add an additional property tax. So if you look

at a tax bill um for a service district, there will have a line that says, you know, I'm going to use the city of Raleigh as an example, but it will say Raleigh tax and it will say what the rate is and it will say the tax that this property pays. Underneath that, it will say special district and it will say the tax rate and it will say the property tax that is paid. So you can establish these districts, you can collect additional tax and it provides extra service. And so these could be things like maintenance, revitalization, environmental improvements. There's a list of things that we can do in these districts and and again outlined by the state. I'll be saying that a lot because we're going to follow the the outline process to make this happen. Um there's certain types of districts you could do. Um, we probably aren't going to do a beach erosion control and flood district just based on our geography, but we um, we're going to talk I'll talk about two of them. Downtown revitalization and urban revitalization. It's not uncommon for North Carolina to have service districts. There's over six 60 in North Carolina. Uh, they their additional tax rates range from zero um, like one that I'm about to talk about [snorts] to uh, 27 cents when this slide was put together. And then the county does charge an administrative fee to collect the taxes for us. Wake County and Durham count or Wake County, Chattam County, and Durm County collect the taxes for us. They charge a small fee to add on the service district. Um, so I'm going to talk about Raleigh for a minute. Raleigh has two districts. They have the downtown, the Raleigh Municipal District downtown. It was established in 2001. They have a 0.068 cent per $100 of property value tax. Um, and I've got on the right the Hillsboro Service District. So, you know, along NC State there, established in 2009, they have a 15 cent additional tax rate. And they they do some things like safety ambassadors. So, if if like um people walk the streets, make sure that people if they you need help getting somewhere, they could help you do some economic

development, might do some marketing. And you can see the marketing just in this little snippet. Live it up on Hillsboro Street is right there. And do some cleaning, extra cleaning. sure the the streets are clean and often with these districts you hear the term clean and green or clean green and safe talking to the services that they provide. I mentioned um downtown revitalization. Kerry actually has a municipal service district. We call it our business improvement district, but they're the same thing. We did one in 2012 to help improve um what was happening in downtown Kerry. There aren't any additional property taxes being levied. They pay the same tax rate in down in this district. It's outlined in blue that you pay in the rest of Kerry. In fact, we we did this to promote development and we said we would pay development fees. So, we we have the ability to charge development fees for certain things like water, sewer, transportation. Um if you built uh since it was established to 2020, we would pay your development fees. So, that was a a big advantage to particularly some of the um projects that were going on at the time. In 2020, council, you decided we've done a pretty good job of getting downtown built and we're going to back off on what of paying those development fees. So, we changed the criteria. Um the criteria is now is in order to get your development fees paid in the business improvement district, you have to come and do a development agreement. So, you've you've brought it way up, which which made sense because of how well downtown's doing. For reference, I did put on there the downtown bid is 278 acres. So, it's pretty big and for for a bid. Um, all right. So, now I'm getting to our request. North Pond South Hills has petitioned the town to create a 48 acre South Hills Municipal Service District. The purpose um as they describe it is to foster revitalization of South Hills. And for us who have been there, you can see the vision of what the resoning is

and what the current state is now. There's certainly some room for for um uh revitalization in that area. Uh and that additional property tax could be paid for additional services and and we've kind of left it at that because [snorts] the next step would be how do we figure we as the town working with the developer have to figure out what those additional services are. Uh this is a map of what the district would look like and I'm going to walk through just some some interesting points on what the what they're proposing the district look like right now. So blue is the district. Um these lighter blue properties are properties that are not owned by um the North Pond developers. So there's 13 properties in the district they're proposing that are not owned. But if you think about how do you set up a district if you're providing extra service you may want to have it con so that you're not you know skipping different properties that you're you're applying that service holistically. So that's something that we'll look at. Um and then the other piece of that is in the resoning we have uh Grace Christian School was part of the resoning. They're proposing that we don't include that in the service district. So this map kind of shows it all together. um what's in in this uh tuxedo striped here uh what's owned by the developer in the tuxedo striped what's not owned by the developer in the um just for Lisa Tarhill blue there and then um in the Grace Christian school is out although it was part of the reasonzoning so that's their proposal to us and we'll work through that as we work through the process so the state requires the state has requirements that we [snorts] as staff we the first thing we do is you must decide we can get a um petition, council must decide, do you want staff to do something? Um the first thing that staff would do if you say yes, we'll prepare a report. The report is made public um for four weeks. There's a time period we four weeks. We let all the property owners notifi that are in the district

um know about the report. The report would show the district map. The report would show um that it meets the standards, which it which it would. The report would show what kind of services we would we would be thinking about in that district. Um, you'd then hold a public hearing, you would vote, and this is one of these, and we were talking about this as staff, this is one where you have to vote twice. So, it'd be one meeting, you hold the public hearing, you could have a vote, then you'd have to have another vote. Uh, and finally, um, it would become effective on the the first of a fiscal year. So, we're we're laying out here that it could become effective as early as July 1st. So, this was the same thing I just said, but kind of in a in a a for a chart format. So, we'd hear the petition. We're going to we're our plan right now, unless we hear something differently tonight, is to bring that petition forward to you formally in your January meeting. Um, if you would like to for us to prepare the report, you have to say you would. If you would like, we would do that in the winter. We would come back in the spring and do some public hearings. You we'd figure out this two voting thing. Lisa would help me and Jenny would help me figure out how to get that right on the schedule. And then it would become effective July 1st, 2026. And with that, are there any questions?

Yes. Uh, I know with the downtown business improvement district, we charge zero.

Are we looking at recovering 100% cost, 50% cost? Are you going to give us a set of options? What are we going to do?

Yeah, I think that's something we want to look at in our report. Um, obviously this is these these types of things work when you establish them early on, right? Right. And so everyone's kind of bought into it. And then as development occurs, right? So right now there's not a lot of property value in South Hills. I there's a fair amount, but there could be more if they go taller and more dense. And so we would want to establish this set up some some rate that we're we're going to bring forward in the report. Uh and then that would allow us to as development happens continue to feed money back into the district for those types of services

as get established.

Okay. Followup. How unusual is it to change that rate? So, if we start out at a lower rate and we're going, "Oh, we're not really covering as much of the cost as I thought we were, we can raise that rate."

Yeah. Yeah. Raleigh's changed their rates um on their their districts. I mean, it's it's every July 1st, just like the tax rate. You could change, in fact, you you I mean, I guess by default, you're making decisions on the downtown bid every July 1 by not doing.

It would be part of the budget ordinance every year. What is the tax rate for that district?

Okay. So, what are the anticipated services that we're looking at?

I think that's a good question and that's where we didn't want to get too far ahead of is this something we want to do, but um certainly there's a lot of infrastructure work that could happen there. Uh sidewalks, streetscape, those types of things. Um so, yeah, I think that's something we'd work through and if there's council has ideas, I think we're open to those as well. Um Scott you um one of your comment uh I need some clarification on that. You mentioned that you [snorts] know while this is building in phases we can take the money and we can pump it back right as a town. So that does not mean that we are going to put the money through development we are only going to improve the other services and amenities like what you just mentioned. Is this a temporary tax increase or this is going to be permanent?

Yeah. So, just like any tax, you could decide July 1st to raise it or I I guess in theory at some July 1st in the future, you could decide to lower it. So, it wouldn't h you you make the decision every

Mhm.

every year.

So, so sort of kind of follow up, is it earmarked? We can't spend that money on anything else, right?

That's correct. Has to be in the district.

I'm a little confused. You said sidewalks or streetside trails or that sort of thing. there are already within that development plan at least on the one side identified sidewalks, street

side. Are you talking about areas that might be need improvement outside of what's already been approved

or it could be both as we work through what what is the development plan works um likely in conjunction with a development agreement. I think that's something we will have to work through. But right now there's no development plan in. So, if the town wanted to use some of this um service district money and do a let's say a sidewalk on a part where they're not developing yet, we might that might be something that we would do.

But we wouldn't use the money to basically offset what they already committed to do. Is that what you're saying? Like this

Oh, you you could. I mean, you definitely you you could.

And it's this is about timing, right? So, in fullness of time, there's a lot of commitments that have been made through the resoning. if the all the property redevelops,

right?

Um we know that all the property won't redevelop at one time. So there might be a phase where you're saying, I want to build through some service district money a connection of a sidewalk. Now, in the fullness of time, that sidewalk might be there, but you know, just like sort of gaps in our regular sidewalk network. We'd either could wait for a redevelopment to happen or we might do it ahead of a redevelopment.

Okay. And are there any um cons to a um municipal service district? I mean, we're hearing a lot of pros. Are there any cons to it?

From a property owner standpoint, you have an additional tax on your property,

right? [laughter]

Um we know the majority owner of the property in the district is in favor of this and they've brought it forward, but the other property owners in the district haven't heard about the idea yet most likely. Um so they may have thoughts on it. Um otherwise, you know, you do have to administer it. you do have to keep track of the funds um and make sure that you're using them only in the district. So there's administrative work that goes along [snorts] with the district, but I think that if you've got a good plan and system for how what you plan to spend the funds on that, yeah, it should be fairly easy to do.

Yeah, I think that's a good point because there are some businesses that got to be living on the margin across

from Rays

that when you do this will probably force them to go. and and we're setting up the district. If if you choose to tell us to do the report and we set the district up, you can work through what's in what's out. You can also work through what's the initial rate and and what how's that rate evolve over time as as [clears throat] that area evolves over time.

And that rate has to be for the entire area. You can't say this half and this half.

That's right. So does it mean that today's discussion is more of like introduction of an concept and then you um we don't have to make any decisions today and this might come back later some details.

I'm suggesting that it would come back in January at your council meeting and then that that report would say would you like us to start that staff report would say would you like us to start the municipal service district report. you have to through a formal motion direct staff to start kind of doing a report that would give you some of the answers to the questions you're asking.

So I'm guessing you're also looking for a little feedback today what we think about the service district.

I would love feedback and I really I mean Russ and I were talking about how do we bring how do how do we have a conversation because it is sort of a complicated multi-step process. So we felt like a work session was a good place to do it. So,

and so South Hills is I'm trying to think of all positive terms.

Old. [laughter]

Old is good.

I'm old.

Senior senior. Yes. Senior season came up with

seasoned. And uh I think uh service district makes a lot of sense because you can make some special services. Gosh, you're like using the same term to define the term. Uh, but uh, make it a special destination place, which I think is exactly what we're looking for there. So, [snorts] my feedback is totally positive at this point. I'm like Lori. If if I've heard I haven't heard any cons. If I hear them, I would like to

Yeah, I think the biggest con is that

you're you are charging an additional tax to the property owners of that

area. And I think the other thing is there's just right now there's the the property tax base, right, is not

huge. And so you're not going to even if you established, let's say, a a medium-sized levy, additional levy on that all that property tax, you don't get a lot of money. So it's not like this is the the complete answer to how would you help South Hills develop quicker. It's one of but not the complete.

At what point do the businesses [snorts] give their input?

Yeah. Go. You want to go?

We can do it in at any time. You have to formally notify every um property owner within the district at least four weeks ahead of the public hearing. So, and after the report is done so that they would have full four full weeks to review the report and then come to the public hearing. Um of course could be notified earlier as well, but that's what the law requires. My only concern would be in this um like what um councilwoman Bush or mayor prom Bush mentioned um you know or follow up to her question like you know if this money is going back to things that the builder has already or the applicant has already committed for then why would we spend taxpayer money on those things like why would we like what is the benefit like why would we do that that's already a commitment from them they should be doing that no

I think we can make we can have that conversation. Um and we can set the district up doing the whatever services that that we kind of all work together on. Um the the benefit to the maybe giving some development money like Fenton was you get things built faster, right? So, if the market is going to build at some pace, if you added additional funds in, and it might not, it probably isn't likely just through the service district. It could be through other things, but you get um you you could tie that to them building more development at a a quicker rate than they normally would.

Scott, can you go back to the slide that showed some of the examples of things

that it might be spent on?

Yeah. And I have questions on that. Um, for example, the the so that the the tax if if we were to levy a tax for the municipal service district,

you want this one.

Can that money, let's say, because uh you had that one.

So, can that money then be applied to say storm water infrastructure? Um, no. So, these are the different types of district. These are the different um statutory authorizations for districts. um we would be looking at an urban revitalization district.

Um and the things you can do in that the money you can spend in that district is um listed out of the kinds of projects you can spend a storm water infrastructure probably is one. Um so you would need to set that out in your plan and what you plan to spend the money on. But I think some of the things in that urban revitalization district could be infrastructure but could also be um you know marketing, could also be the clean and safe, extra safety, extra trash pickup, those sorts of things. So, it could be a wide variety of things that are done. You can't switch the kind of district you've created.

Okay.

Um and but I don't think we need to because it's the urban district encompasses a lot of possibilities.

Yeah. What I'm what I'm hoping to be clear on is the whether I don't want to call them self-unding, but whether those those tax revenues can be applied to what is going to be probably necessary core infrastructure if it's a denser built environment, taller that that and that kind of thing. Um, I'd be pleased to hear that that it is. I just want to make certain that I'm I'm clear on that.

I like that question. I I want to add to that. Let's say we decide a pedestrian bridge is needed over

over the road,

roadway improvements, widening a turn lane.

Can those kind of things?

My understanding is they can, but that would that could be part of as you direct us to write a report that could be part of the things that we make sure are very clear in the report. What are the things that you could or couldn't do? And sounds like infrastructure is something you want us to particularly highlight when we when we do the report.

I walkability, mobility.

Yes, very much so.

I have to say the thing that's odd about this whole conversation, I can't ever remember any developer coming to us and saying, "Please tax me more." [snorts]

Right? Please charge me more. Right? So what that and and I'm as I'm thinking about that if they want to be taxed more that means they already have an idea of what are the kinds of things they might want that money to be used for

and

so I'd really like to have insight into what are those things in more detail.

Yeah. Yes. when you see the staff report in January and we we have it now. They've sent they've sent their petition

and so um they talk about they give the map of the district um and they speak a little bit to the kinds of things that they might want to do but I think this is good feedback in their sitting here tonight that if you know if you'd like to hear get more detail on that between now and January we have the opportunity to work on that.

Yep.

Absolutely. When we went to N sorry sorry

no go ahead. When we went to Nashville, I think they had their uh downtown under a spe special district and they had special tax for that. And they, you know, when you went to the downtown, it was super clean. It was super safe. There were like additional um security. I I don't I don't think there were police officers, but security was on the street. Um it was very like walkable and you could get out in the night and it was super clean. And I think things like those will definitely will like from this perspective would be nice to see. But then I agree with the mayor that you know infrastructure probably could be a great addition as well.

Can I also ask um the the timing of the highway ramp? Do we have insight into when that's being moved?

I do not at this point. We could get that.

That's not even a tip project, is it? I don't know who would know. I don't know who to look at.

Time's been changed a little bit. It's

in the back five.

So that means it's probably 10 years

out. Yeah.

Well, I'm not being sarcastic. About a decade probably, right? Yeah.

Okay,

Britney, I cut you. No worries. My question was related to Lor's question is just trying to understand the pros and cons or the incentives for the owners. Is it primarily as SA suggested that the town offsets cost or is then responsible for aspects of the project that they might otherwise have to pay for or I'm just trying to understand as you are that they have come to request. So it's it's obviously providing some benefit to them. And I guess I'm not entirely clear on what that is.

I mean we we can work through and make sure that we when we do the report we're really talking to them. I'll say in districts in general oftent times there's some advoc advocacy piece you know there's the economic development or marketing piece so you know they might spend some of that extra tax money getting folks to come um for the Nashville situation if Broadway is dirty and nasty then no one wants to go there and so the businesses are glad to pay extra tax so that it will be clean and we'll feel safe and all the um parties and bachelorettees will go and have their thing and everyone will feel good about it and so and that there's kind of that you know they they recognize there's extra things that they want and there's a mechanism that they can pay for it and they don't have to then compete, right? Because it is funding for this district, they don't have to compete with all the other funding for everything else because they've already said we'll pay a little extra to get this stuff.

If some of the other owners are not interested in being part of the MSD, h how does that work?

So, you will decide who's in and out of the district when you make your final decision. So this is just a proposal from the applicants, but you have control over what the final it could be bigger than what they've proposed. It could be smaller donut holes.

Yeah.

Can we do you want to show the bid map again? [laughter]

The bid map is a I don't think there's donut holes, but our bid map,

but let's say like we decide that um one of those properties has a in in darker

blue there has a reason that it doesn't make sense. You don't want to put them in the district. Yeah, you could you could donate all that out. or let's say um we decide we we find out that the Grace Christian School makes a lot of sense to put in the district, we could expand that out in and the downtown district in Raleigh that recently got expanded a few years ago. I

you can also change you can change the boundaries of the district. You have to go through this public process again, but uh you can change the boundaries if you decide they're not correct over time. So also for the boundaries do we have to talk to the property owners if they would love to join the

we have yes we have to give them notice of it and they have the opportunity to provide their comments on whether they want to be in or out.

Okay and another question is uh the people around there they might not like high density but their concern is the infrastructure is before invested before the development or after. So it if this passed will the tax to be paid for the infra infrastructure before the development or can they have to see something change?

That would be part of what we talk about in the report in the plan. Yeah.

And to be clear, Lisa, that comment period, that four-week comment period is is just a comment period, but we ultimately would make the determination and could impose it. Not that I'm saying that's advisable, but the ultimate determination is ours.

Yeah.

And I would love to share that my son goes to the polar ice car there

and the parking lot is awful. [laughter]

If if you know that, but if that's not in the district, it'll be everywhere. It'll be very nice and that area will be so different. Yeah.

So that'll be a challenge for the future. Look,

great. Do do we have an idea of the initial projected revenue and the future projected revenue on

we we haven't even like we I haven't even done it because I'm like there's I didn't want to get ahead of you know like

we just say no.

Yeah. I I don't know what you're going to say.

Yeah. We [laughter] like the concept.

Yeah.

The concept is good but I think the details matter.

Yeah. And even before that's the first step in the state regulator process is we will we will bring it forward to you in January and if you tell us to to go and do the report we now have some information we know you want in the report which is very helpful and then that report would be part of the decision-making process as well as outreach to the other um property owners and

it would be great to understand the burden on the various property owners right so that as we make this decision you know we as as you said, Council Member Richards, is what does that burden look like on the various businesses, right? So that we're making an eyes wide open because some of those businesses have been there for a long time and some of this is going to be reuse and redevelopment and some [clears throat] of it is defunct and has very little values. So it's property tax impact is less. But what would it look like to Grace Christian School if they were part of it? What would that a as we work through the numbers? You're talking about per parcel analysis of a of a additional levy one that are not part of the the request, right? What would that look like to them so that we understand their full impact? There's pros, but what is that in that case might be?

I just want to make sure I could Yeah.

capture what you're saying.

And maybe what the value of penny is like we've done otherwise.

Yeah, exactly.

Like a penny per You could show this map and show what a penny would be for each of those parcels.

That would be really helpful. And what are those properties worth so that we could do the math? Mhm.

I've got a I've got a motion over here. I'm happy to

So, this is the deal. I wanted to just come forward and um uh we felt talking about it would be good and then [cough] in January when I bring it back to the

Oh, you need a motion to make the report.

Uh I will do that in January.

Ah, okay.

So,

I've got it ready when you

Okay, I'll take I'll [laughter] take one then.

I'll keep it in my notebook.

I'll take one then. Yeah.

Thank you all so much.

Thanks, Scott.

All right. Carrie Harville is gonna come up and talk about the 2026 banual citizen survey.

Good evening, mayor and council. It's so nice to be here tonight to talk about the bienial survey. Sometimes you see Susan Moran talk about this topic, but tonight you get me because Susan is not here. So, we will jump right in. So, if you all think back, where were you in 1998? Mayor, it's my understanding you were on ISAB

and I was the chair

and you made the decision to start our wonderful adventure with the uh bianial survey every two years. So um thank you for that and we have been working with BKL research and consulting almost since the very beginning. So we've been with them for a very long time and this is the original press release for the bional survey. So we have um quite a few goals that we work on with a bio with for the bianial survey and really we're trying to gauge our citizens opinions on our services, our priorities, how they feel about their quality of life in Kerry and that helps inform us for decisions going forward. And so um the methodology that we use is representative random sampling of approximately 400 Kerry residents and that's what's sampled every two years and it is done by telephone which is unique but it does help us get the randomization that we need um for it to be statistically significant. Typically we have um cut down this survey from the last survey round and it should take about 20 minutes. That's what I've um been given as an estimate for this year's survey. Our survey format is broken down into three different type of questions. A a third of it is new questions. A third is repeat question and then the last third is demographic questions. Those repeat

questions we typically do not change the format of those questions. And that helps us um do trends over time. So there are some questions that we can go all the way back to 1988 and pull that data to see how trends have changed in terms of like quality of life or some of the services that we provide. Um a lot of the repeat questions are related to police, fire, parks and recreation and that does help us with our accreditations that we um do over time. We have quite a different avenue, multiple different avenues to communicate related to the bienial survey to reach our citizens. So this is a list. Um we also do carry matters. So I believe um there may be a carry matters tape later this month um that will go out on KY TV. Um so lots of different avenues and the BUD newsletter starts the end of this month and will run again next month. So citizens will get that in their utility bill. We started editing the survey instrument back in October. Went to ISAB, got lots of good feedback from ISAB for the updated draft survey instrument, which will be emailed to you all tomorrow. So, you'll get a copy of the draft instrument. if you could send me any feedback you have within the next week. So then I can work with the vendor that will be making all the telephone calls, get an estimated an updated estimated uh call time for the people and then they'll start doing the data collection on January the 12th and then we should have a final report from BKL in the springtime and we'll we typically do or I can do a presentation and final report in summer. So, next steps on this project, you'll get an email from me tomorrow if you could send me any questions, comments, I'm happy to answer those for you. Um, and then there will be a final draft instrument presented to the executive team. They'll help me make any final

tweaks to the instrument and then data collection will start in January. Any questions? No. But I'll share for those of for the folks that are listening to this meeting, ISAB stands for Information Services Advisory Board. And the reason why that board's feedback on a project like this is so important is because not only do they focus on technology, but also bilateral communication. So us talking to citizens and citizens being able to talk to us. So I just wanted to share that tidbit because I also I wasn't the chair, but I really enjoyed being on the on the ISAB. Um it was a very cool board.

Yeah. And I'd like to thank you all again for coming. They had they spent a lot of time on it. Yeah.

Um and we're really thrilled to be part of it. And then for citizens who are watching, not only are all the surveys and the results online, but all of them are also in our open data portal.

That's correct.

So I've also had an opportunity to play with some of that data and look at trends over time over the last 20 years. And it's it's great information for people who are um civically obsessed who might want to look at information over time and how also how the questions have really shifted as well.

Yeah.

But I also appreciate the statistically significant

way that you all it's not like a Zen City poll. It's not like a public input poll. This is statistically significant. So this allows us to really look at um our citizens input and ensure that the demographics of the survey match the demographics of the town. Right.

Right. And so I I think we're probably one of the few municipalities that have been doing it for this long and this way so that we can really get the information over time as well as have a real sense of what our citizens say. not just the loudest, not just the ones who are on social media, right? But to

actually hear what they have to say. So, thank you for doing this.

Yeah, that's absolutely right. I had somebody ask me, "How many times will they call you back?" And I went back to look and they'll call you back like 20 times. Oh, really?

So, they really are trying to get the individuals that they initially start to reach out to because that helps with the representation.

Yeah, that was a question in the ISAB. What if I miss their call? Will they not call back?

They call back. Yes. And they leave their information on your voicemail. Great to know. Yeah. Any other questions?

Thank you all so much.

Thank you.

Thanks.

Thanks, Carrie.

Let's see. [snorts]

Should just be [cough] manager's update. There you go. So, assistant town manager uh Dana Woodmar is going to come up and give a snapshot on some recent revenues. [clears throat]

Okay. I think you're used to seeing this one uh from last year, but of course we're early in the year and um and I just want to kind of refresh a few things. So, our two top revenue sources for the general fund are sales tax and property tax. So, the sales tax is one we talked about last year. You'll see um the lined the trend line that we followed last year. And uh and the good news about sales tax is it is coming in a little bit higher this year than um than it did last year. Our budget was uh planned to be 1% higher. And if you look at the detail um and the important point about this is uh they're always behind. So sales tax we don't get the information for about two and a half months. Um, so the information that was provided there, the the August sales tax receipts are up 2% from last year. Um, they are down 5% from July of this year. We had a good July. Um, the September sales tax receipts are up 6% this year over last

year. Another very good um indicator. And uh, and then they're up 2% over August of 25. Um the October sales tax are up a full 10% year-over-year. So starting to look optimistic in the sales tax front. Um the an important thing to note and that is actually up above should be a note from up above. Um the September 24 sales were impacted by hurricane Helen. So some of the variation relates to events in the world. Um and then and then October sales tax is down a little bit from September. We had a we've had a few good months

and reminded especially new ones where the sales tax comes from. It's not just Kerry.

Uh correct. The sales tax is um is done by the state. It goes back it's all of Wake County and then Wake County we don't get the detail about what actually is collected here in Kerry. Wake County redistributes it based on population. So, so Kerry uh is not growing as fast as other communities because we're a little bit past our peak in growth. Therefore, as other communities grow and we don't grow as fast, our proportion of Wake counties is always going to be continue to get a little bit less a little bit less each year.

I always assume the counties got got the allotment by population as well. That's accurate, right? Or did I assume that wrong?

I Does anybody have that? I believe it is not by population. It is by that that is actually a yes, the sales by county, but I can check on that.

Okay.

Based on that, are you all aren't altering or I guess the question is are you altering your projection of of 1% or

Nope. Okay.

Yep. So, and let me let me go back because I did want to say this uh when I

was at the other one. So, you'll notice the sales tax uh the bar on the left gives you the actual amount. So, it looks like a big jump. Well, when we get to property tax, you're going to see it's a it's a completely different scale on the on the side. So, the typical sales tax uh amount in a month is in the prox approximately 5 million and it kind of bounces around that area. And no problem.

Um just one question as a followup to your comment on sales tax.

You said that you know as other communities are growing our taxes will start shrinking sales taxes and it's really county how Wake County is performing but the numbers don't indicate that. The numbers indicate that we are kind of maintaining. So what does that mean that others are not growing or we are growing faster?

Nope. That means that the um amount of sales tax that is being collected is growing. Yes.

So keep spending money.

Yes. People are spending money.

I like that.

All those numbers indicate that. And um and again our proportion of the county is only going to change ever so it's slightly going to get smaller and smaller, you know, just over time.

And our sales tax is roughly 20% of our revenue, total revenue, give or take. Right. That sounds about right. Yes. Okay, that is Yes. Yep.

Um, okay. Property tax. Property tax has a completely different outlook. So, when property tax comes in, we peak when it's due. So, our biggest month is almost always November. And um and you can see that the fiscal year uh 25 [cough] numbers are in the orange. The fiscal year 26 numbers are in the green. and the scale on the left hand side is so much different. It's kind of hard to see the gap between the two of them on what's happening. Um, and that's primarily because in the month of November, we typically bring in about 60

million. So, it's a it's a very large uh increase in our revenue in that in that month.

But does this this graph does not mean just for people who are watching that we are losing money. It's just the correct

trend every year. This is the trend. Correct. Yes. So, so the bills go out in August typically and um so you see some people will pay right away. So we'll get about 10 million. People pay their bill immediately upon receiving it. Um September was close to 10 million. October close to 10 million. Since it's due right at the beginning of January, there's this spike that happens in November. People are kind of getting ahead of the holidays.

So this is normal.

Yes. And then December, you can still see quite a lot still lands in December. Quite a lot still lands in January. Most people try to pay before the due date. Um, which is why it drops off then in February. Okay. Okay. So, interestingly on um on property tax, we can't draw conclusions yet. So, but I do want to give you some details. The November property tax revenue is actually down this year, 4% from last year. Something we did not expect. Um, of course, it's much higher than October. That is a very typical thing. People, lots of people pay in November. So, much higher increase there. And, um, and then if you look at the bullets at the bottom, it gives the total numbers so you can see what we're dealing with. So in fiscal year 26 year to date we've collected just over 90.5 million and that's through the end of November. Whereas in fiscal year 25 year to date it was about 89 or yeah 89.5 million. So about 1 million higher this year so far as of the end of November. Now, the part that is a little bit interesting is this year-over-year to date increase is only

1%. We would have expected to see maybe more like a 5%. Um, so we are just watching it just like we watch everything else and um and we'll have a much better sense of this by February because most people are going to pay by the due date in January and um you know some people might be just paying slightly later this year than they did last year. So, I view this as a cash flow.

Yes.

Because it's all about collections.

Do we have an issue with cash flow if we're 5% below what we're thinking or we're so balanced that it doesn't really matter?

We do not have an issue with cash flow. In fact, we've just made decisions to invest some of the money that we have in the account because we have we had too much in the account.

Okay. Um and so uh and that's very typical because we receive so much at this time of the year. Um and so we have various investment um vehicles that we use. They're all um they all are safe and stable and things and uh and we manage the amount we have in the account based on how much is needed over the next several months.

And and and you probably have it on a coming slide, but I'll ask anyway. Traditionally we collect like 99% or something.

Yes. Yeah. I don't have that on a slide but yes like 99.5. Yeah. Almost all.

So just for my clarity follow up to mayor's uh question like the revenue that you're here that you mentioned here November property tax revenue that's really collection.

That's collections. That's correct.

Okay.

Yes.

This is what we have collected.

Correct.

Yep. Can can you explain your last comment? What it says here which was below what was anticipated. Can you explain why you anticipated more or you know you can't really this is not a great um this is not easy to measure month by month because it is entirely

people's behavior. Uh and there could be things that have happened that cause people to wait and pay a little bit later. Um, but generally speaking, if you look year to year, this line is going to look like this line. And and that's just because in general terms, people are paying basically the same um time of year. Now, we know that the rate was a little bit higher this year and we had a little bit more base. And so, that's that's just the difference. I mean some of it may be like mine's in escrow and it comes out of escrow at the same time every year which is timed with that peak.

Did we see a difference the year we had the rebell and the tax increase as far as collection timing?

That's a good question. We'd have to go back and double check that. You don't if you have to go back that means it wasn't an issue and you don't remember. So the answer is probably no.

No. No. it the the trend line looks almost like this. I mean, it's ve this is a very typical line that we're seeing and um and the scale is so large on the left. It's very hard to see 1% or 4% or 5%.

Right. That's why I was wondering why why your last statement which was what did you say not anticipated? I was wondering it

we would have expected um when we got to November because November is always the biggest month. we would have expected that we would have seen that sort of average increase that we would have anticipated this year which is I think in the range of five or six%.

Okay.

Based on historical trends

possibly.

Yeah. So Tenna do as part of this process and I'm going to digress a little bit but as part of this process do we also see um given the economy and the conditions that we have um right now do we also keep track of um how what is the rate of foreclosure and um things happening like in the property market?

Uh we do not track that closely. the the

99.5% collection rate has been stable for so long in Carrie that um you know it's just a very small number of properties that have any issues associated with them.

I have a question uh the 5% is the dollar amount not the uh how the property

um the dollar amount the revenue so we're strictly looking at revenues here so what we are receiving in any indivi what any individual pays is, you know, different based on what their assessed valuation is. But of course, we did have a a small increase in our rate this year. I want to make sure I understand. I'm going translate. We would expect receipts at this point based off of past percentage paid

to be a little bit higher because we raised property taxes a little over a penny and there's a few more taxpayers that have come online in the last year.

You got it.

Okay. You got it. Just wanted to make sure I understood.

You got it. Mhm.

And to add to that and there was a revaluation in Chattam County.

Oh yes revaluation. So yes, yes, a few more properties came on the tax rolls and

and

Chattam County had a revaluation.

Okay,

good.

Any other questions?

No.

thank you.

Thank you.

Thank you, Dana.

Thank you, J.

That I was going to say that's all from staff tonight, but I did want to thank you all for asking such great questions tonight.

Good job. So, we're not doing a close session here. We're doing one after the council meeting. Okay. So, that will conclude the uh work session. Thanks everyone.

Thank you.