Aug 28, 2023 EEDC Meeting

[1. CALL TO ORDER, ESTABLISH A QUORUM A. PledgeofAllegiance.]

I'D LIKE TO CALL THE MEETING TO ORDER OF THE EDINBURG ECONOMIC DEVELOPMENT CORPORATION.

LET'S START WITH CALLING ROLE.

AARON DEVITTO. THEN THERE'S.

ROLAND GOMEZ PRESENT.

WE HAVE QUORUM. THANK YOU SO MUCH.

RAUL RESENDEZ.

EDDIE GARCIA PRESIDENT.

WOULD YOU PLEASE JOIN ME IN PLEDGE OF ALLEGIANCE? 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, WITH LIBERTY AND JUSTICE FOR ALL.

[2. CERTIFICATION OF PUBLIC NOTICE]

I KNOW THIS HAS BEEN POSTED THE REQUIRED PERIOD OF TIME.

[3. DISCLOSURE OF CONFLICT OF INTEREST]

OMAR YES. UNDER STATE LAW, A CONFLICT OF INTEREST EXISTS IF A BOARD MEMBER OR CERTAIN MEMBERS OF THAT PERSON'S FAMILY HAS A QUALIFYING FINANCIAL INTEREST IN AN AGENDA ITEM, IF THERE IS A CONFLICT OF INTEREST, THE BOARD MEMBER CAN'T PARTICIPATE OR VOTE ON THE ITEM.

[4. PUBLIC COMMENTS]

ARE THERE ANY CONFLICTS TO DISCLOSE? NO, NONE. THANK YOU.

CARLOS, DO WE HAVE ANYBODY THAT SIGNED UP FOR PUBLIC COMMENT?

[00:05:04]

OKAY. THANK YOU. DIRECTORS REPORT.

[5. DIRECTOR'S REPORT]

I'LL BE BRIEF ON MY DIRECTOR'S REPORT BECAUSE WE HAVE A LENGTHY AGENDA.

WHAT I DID WANT TO NOTE ON THE LABOR MARKET INFORMATION THAT'S IN YOUR PACKET WAS OUR UNEMPLOYMENT RATE WAS UNCHANGED OVER LAST YEAR FROM JUNE OF 22 TO JUNE OF 2023 AT 5.2, WHICH IS THE SECOND LOWEST IN THE VALLEY.

BUT WHAT'S INTERESTING TO NOTE IS THAT WE HAVE 1406 ADDITIONAL PEOPLE IN THE LABOR FORCE.

SO THAT MEANS THAT OVER THAT LAST YEAR WE'VE CREATED SOME MORE JOBS.

AND SO EVEN THOUGH UNEMPLOYMENT RATE SEEMS TO STAY STEADY, THERE'S MORE GROWTH COMING IN.

SO WE DID WANT TO NOTE THAT AS FAR AS THE LABOR STUDY GOES.

IN ADDITION TO THAT, IN YOUR PACKET, YOU HAVE SOME UPDATES FROM THE ALLIANCE FOR I-69, TEXAS, THE SOCIAL MEDIA MONTHLY REPORT, SOME NEW FOLLOWERS AND ALSO OF NOTE IN OUR COMMERCIAL PERMITTING AND RESIDENTIAL PERMIT CONSTRUCTION VALUES OVER LAST YEAR, WE HAVE EXCEEDED LAST YEAR'S YEAR TO DATE NUMBERS BY CLOSE TO $70 MILLION.

SO WE'RE AT $278 MILLION TO DATE IN TOTAL CONSTRUCTION SO FAR.

AND THAT IS REALLY EVEN SURPASSING LAST YEAR'S END OF YEAR TOTALS.

SO VERY GOOD PERFORMANCE THUS FAR IN TERMS OF COMMERCIAL AND RESIDENTIAL GROWTH.

THERE'S NEW CONSTRUCTION IN TERMS OF SUBDIVISIONS AS WELL.

THERE'S 63 UNDER CONSTRUCTION RIGHT NOW WITH OVER 4800 LOTS UNDER DEVELOPMENT.

AND THEN IN REVIEW, WE HAVE 34 NEW SUBDIVISIONS WITH THAT TOTALS ABOUT 1300 NEW LOTS AND 67IN PRELIMINARY REVIEW, WHICH IS ANOTHER ALMOST 1600 LOTS.

SO VERY, VERY GOOD RESIDENTIAL GROWTH RATES GOING ON RIGHT NOW.

SOME OF THE UPCOMING CONFERENCES THAT WE WANT TO LET YOU ALL KNOW ABOUT IS TEAM TEXAS ECONOMIC SUMMIT IS TOMORROW THROUGH WEDNESDAY IN ODESSA.

I WILL BE FLYING OUT AT 630 IN THE MORNING TOMORROW MORNING.

CARLOS WILL BE IN AUSTIN FOR THAT ONE.

AND THEN CAFE CON USA AND CANADA IN CANADA IN MONTERREY ON SEPTEMBER 5TH, CARLOS WILL BE ATTENDING THAT CONFERENCE AND ACTUALLY REPRESENTING US IN THE IN HIS BOOTH.

AND OF COURSE, ON SEPTEMBER 8TH, WE HAVE THE TDC SALES TAX WORKSHOP.

TEXAS ECONOMIC DEVELOPMENT COUNCIL HAS NOT HAD ONE OF THESE WORKSHOPS IN THE RIO GRANDE VALLEY IN A LONG TIME, IF EVER.

SO THIS IS AN OPPORTUNITY FOR LOCAL ELECTED OFFICIALS, BOARD MEMBERS AND STAFF TO LEARN A LITTLE BIT MORE ABOUT SOME OF THE NEW LEGISLATIVE REQUIREMENTS AND LEGISLATIVE CHANGES TO THE SALES TAX.

SOME OF THE UPCOMING EVENTS, ASIDE FROM OUR CITY COUNCIL WHERE WE WILL BE PRESENTING, HOPEFULLY THE PROGRAM WILL WORK IN THE BUDGET.

WE HAVE A RIBBON CUTTING COMING UP ON SEPTEMBER 15TH, THEN A JOB FAIR ON SEPTEMBER 14TH AS WELL IN COORDINATION WITH WORKFORCE SOLUTIONS.

AND OF COURSE, THE SOUTH TEXAS INTERNATIONAL FILM FESTIVAL IS BETWEEN THE SEPTEMBER 14TH AND 16TH.

IN OCTOBER. OUR TDC ANNUAL CONFERENCE WILL BE IN HOUSTON.

THOSE OF YOU WHO ARE INTERESTED IN ATTENDING AND LEARNING A LITTLE BIT MORE ABOUT ECONOMIC DEVELOPMENT AND SOME OF THE UPDATES THAT ARE GOING ON, THIS WOULD BE A GOOD CONFERENCE TO ATTEND AS WELL.

[A. Economic Development Report]

AND THEN FINALLY, I JUST WANT TO SAY THAT THE ECONOMIC RIO GRANDE VALLEY PARTNERSHIP ECONOMIC SUMMIT THAT WAS HELD LAST WEEK WAS A VERY BIG SUCCESS.

A LOT OF PUBLICITY, A LOT OF PEOPLE THAT SHOWED UP IN EDINBURG TO HELP US TALK ABOUT REGIONALISM AND UNITY IN TERMS OF ECONOMIC DEVELOPMENT. YEAH, IT WAS A REALLY GOOD EVENT.

YOU GUYS WERE RIGHT UP FRONT, BUT IT WAS SO WONDERFUL TO SEE ALL OF THE MAYORS GET UP ON THE STAGE AND ACTUALLY SIGN AN AGREEMENT TO COOPERATE AND TO TRY TO BE MORE COLLABORATIVE WHEN IT COMES TO ECONOMIC DEVELOPMENT.

THINKING AS A REGION RATHER THAN INDIVIDUAL CITIES.

IS THAT IT? FOR THE REPORT.

ANY QUESTIONS OF RANDALL? ALL RIGHTY. I KNOW WE'RE GOING TO HAVE QUITE A LONG MEETING TODAY, SO LET'S GET TO APPROVAL OF THE MINUTES.

MADAM PRESIDENT. OH, HI.

WE HAVE COUNCILMAN AND BOARD MEMBER HERE, MR. DAN DIAZ. THANK YOU FOR JOINING US.

CAN WE GET A MOTION TO APPROVE THE MINUTES FOR JULY 12TH AND JULY 25TH?

[A. ConsiderapprovalofMinutesforBoardMeetingsheldonJuly12,2023andJuly25,2023.]

[00:10:08]

I GET A SECOND? SO SECOND, ALL IN FAVOR SAY AYE OR RAISE YOUR RIGHT HAND.

OKAY. WE HAVE A VALLEY INITIATIVE PRESENTATION, AND I THINK WE HAVE ALIDA HERE.

IS IT ON? IS IT ON? IT'S KIND OF HARD.

TEST. THERE YOU GO. THANK YOU.

SO MY NAME IS AIDA VILLAREAL AND I CURRENTLY SERVE AS CEO OF VALLEY INITIATIVE FOR DEVELOPMENT AND ADVANCEMENT.

FOR THOSE WHO MAY BE UNFAMILIAR WITH VIDA, WE ARE A NONPROFIT ORGANIZATION WHO HAS BEEN SERVING THE RIO GRANDE VALLEY FOR THE PAST 28 YEARS AND PROVIDING WRAPAROUND SUPPORT SERVICES FOR COLLEGE COMPLETION AND COLLEGE SUCCESS.

AND SO WE'RE VERY THANKFUL FOR THE EDC FOR YOUR SUPPORT THIS YEAR AND A GRANT OF THE 50,000 IN WHICH OUR BENCHMARK WAS TO SERVE

[B. DiscussandconsiderapprovalofthefundingproposalsubmittedbyValleyInitiativefor Development and Advancement (VIDA).]

15 RESIDENTS FROM EDINBURG IN YOUR PACKET IS A ONE PAGER PROJECT UPDATE IN WHICH WE ARE SHOWING THAT WE ACTUALLY EXCEEDED THE BENCHMARK AND SERVED 28 EDINBURG RESIDENTS.

AND OUT OF THOSE 28, WE HAVE MAINTAINED A PERSISTENCE RATE OF 100%, WHICH MEANS ALL OF THE STUDENTS HAVE EITHER GRADUATED OR PERSISTED INTO THEIR SECOND YEAR OF EDUCATION. AND SO I'M HERE TODAY REQUESTING YOUR CONSIDERATION FOR AN INVESTMENT FOR NEXT FISCAL YEAR AND THE AMOUNT OF 100,000 IN WHICH VIDA WOULD BE MATCHING A $50,000 INVESTMENT FOR A TOTAL PROJECT OF $150,000 TO DOUBLE OUR OUTREACH AND OUR IMPACT TO SERVE AT A MINIMUM 30 EDINBURG RESIDENTS.

AND I'M HAPPY TO ANSWER ANY QUESTIONS OR CONCERNS YOU MAY HAVE.

SO, MEMBERS, I KNOW WE WE HAD ALL HEARD FROM THAT BEFORE ABOUT THE WRAPAROUND SERVICES THAT VIDA PROVIDES.

WE WANTED TO MAKE SURE THAT IT WAS GOING TOWARDS EDINBURG RESIDENTS, WHICH IT WAS, AND THEY EXCEEDED IT.

I KNOW THAT SOME OF THE THE WORK THAT THEY'RE DOING IS THE KIND OF WORK THAT REALLY KEEPS KIDS IN SCHOOL, BUT ASIDE FROM THAT, REALLY PLACES THEM THEN INTO HIGH PAYING JOBS, WHICH IS CRITICAL.

WE WANT TO GET THEM OUT AND GET THEM IN THE WORKFORCE.

SO I'M GLAD TO SEE THAT THE NUMBERS HAVE INCREASED THE WAY OR AT LEAST THAT YOU DID BEYOND WHAT Y'ALL HAD PROMISED INITIALLY.

SO I THINK THERE'S A MATCH ALSO THAT Y'ALL WOULD PROVIDE.

IF WE DO A 100,000, YOU'LL MATCH IT WITH 50,000, IS THAT RIGHT? CORRECT. DOES ANYBODY HAVE ANY QUESTIONS FOR MISS ARIEL? I DO. THOSE STUDENTS AND WHERE THEY'RE AT IN TERMS OF WHAT SCHOOL AND OR WHAT THEY'RE DOING? YES, ABSOLUTELY.

AS A MATTER OF FACT, WE DO SEND A QUARTERLY REPORT TO THE EDC, BUT WE CAN ALSO SHARE THAT WITH YOU ALL IF YOU PREFER TO RECEIVE IT AS WELL.

HOW SOON CAN WE. BY TOMORROW.

YEAH, I KNOW. IT'S IN THE ONE PAGER.

IT SHOWS THE AREAS THAT THEY'RE STUDYING IN OR THAT.

SO THE STEM FIELDS, THE SPECIALIZED TRADES, SOCIAL SERVICES AND BUSINESS WITH THE LARGEST BEING THE SPECIALIZED TRADES.

SO I PROBABLY THAT PROBABLY MEANS THAT MOST OF THEM ARE EITHER GOING TO STC OR STC AND WELL, ACTUALLY WOULD BE STC IF IT'S LOCAL, RIGHT? YES. BUT YEAH, THAT WOULD HELP TO HAVE THAT.

SO WITH A HIGHER CONTRIBUTION, I KNOW HE HAD CONTRIBUTED 50,000 ALREADY AND GREAT JOB, BY THE WAY, ON, ON HELPING, YOU KNOW, EXCEEDING WHAT YOU HAD PROMISED WITH BY DOUBLING THE CONTRIBUTION.

IS THERE A CHANCE THAT THESE NUMBERS FROM COULD INCREASE 30 TO MAYBE A DIFFERENT NUMBER? YES, ABSOLUTELY.

SO I CAN PRETTY MUCH GUARANTEE YOU THAT IF THE BENCHMARK IS 30, THAT WE WOULD OVER EXCEED THAT BENCHMARK AS WELL FOR NEXT YEAR BECAUSE WE'RE ABLE TO BRAID YOUR INVESTMENT WITH OTHER FUNDING SOURCES.

AND JUST RECENTLY, WE WERE AWARDED A $3 MILLION NURSING GRANT FROM THE DEPARTMENT OF LABOR.

SO A LARGE PORTION OF THAT CAN BE LEVERAGED WITH YOUR INVESTMENT TO AGAIN EXCEED THE BENCHMARK AND SERVE MORE RESIDENTS.

SO AND YOU'VE GOT A I NOTICED YOU'LL HAVE A DATABASE CALLED SOCIAL SOLUTIONS APRICOT.

AND SO THAT KEEPS WHAT WHAT KIND OF DATA DO YOU HAVE IN THERE? SO WE TRACK THE APPLICANT FROM THE VERY BEGINNING AT THE POINT OF APPLICATION THROUGHOUT THEIR CAREER JOURNEY UP UNTIL GRADUATION AND EVEN AFTER GRADUATION, WE STILL TRACK THEM THREE YEARS AFTER THAT.

[00:15:02]

SO IT COULD HAVE ANY INFORMATION FROM ELIGIBILITY TO THE RESOURCES THAT THEY RECEIVED TO THE EMPLOYER WHERE THEY'RE WORKING AT, AS WELL AS THEIR ANNUAL SALARY OR WAGES AND THE GROWTH OF THOSE WAGES OVER THE THREE YEARS.

YEAH, I REALLY LIKE THAT THAT TRACKING SYSTEM BECAUSE I THINK A LOT OF TIMES PEOPLE PLACE THEM AND THEN THEN THEY GET LOST AND THEN YOU DON'T KNOW WHAT HAPPENS TO THE PERSON.

ANY OTHER QUESTIONS? DO YOU ALL WANT TO WAIT FOR US TO GET THE DOCUMENT AND VOTE ON IT FOR THE NEXT MEETING? OKAY. THANK YOU SO MUCH, MISS.

[C. ConsideracceptingtheEdinburgEDC2022Audit.]

SO WE HAVE CONSIDER ACCEPTING THE EDINBURG EDC 2022 AUDIT.

AND WE HAVE JOINING US FROM BURTON MCCUMBER AND LONGORIA RICKY LONGORIA AND TELL ME YOUR NAME AGAIN.

LUIS GOMEZ LOPEZ YEAH, WE HAVE LUIS LOPEZ.

THANK YOU. THANK YOU, MADAM CHAIRMAN.

AGAIN, MY NAME IS RICKY LONGORIA, A MANAGING PARTNER OF THE FIRM OF BURTON MCCUMBER AND LONGORIA PRIVILEGED TO ACTUALLY BE ABLE TO SERVE YOU ALL AND SERVING NOT ONLY YOU ALL, BUT THE CITY OF EDINBURG.

THIS IS MR. LUIS LOPEZ. HE IS AN AUDIT MANAGER WITHIN THE FIRM.

HE WAS THE ONE PROBABLY MORE HANDS ON THAN MYSELF IN TRYING TO GET THIS AUDIT TAKEN CARE OF AND AND COMPLETED.

UM, I HAVE THE OPPORTUNITY TO TO TO SPEAK TO MADAM CHAIRMAN BEFORE THE MEETING SAID, YOU KNOW, RELATIVELY SPEAKING, THIS REPORT SHOULD BE FAIRLY EASY.

THE CHALLENGE I'M HAVING IN TRYING TO PRESENT YOU ALL THIS REPORT IS REALLY JUST A NUMBER OF ERRORS THAT WE FOUND IN LAST YEAR'S REPORT THAT HAVE CARRIED INTO THIS YEAR'S REPORT.

AND SO I'M GOING TO TRY NOT TO SPEAK LIKE AN ACCOUNTANT, BUT I'VE BEEN DOING THIS FOR 30 YEARS.

THERE'S GOING TO BE VERY HARD FOR ME TO DO SO.

SO I'M GOING TO DO THE BEST I CAN TO TRY TO SUMMARIZE IN PLAIN ENGLISH, IF YOU WILL, THE EFFECT THAT THOSE ERRORS HAD IN ALL'S FINANCIAL STATEMENTS AND CERTAINLY THE SILVER LININGS, BECAUSE I DON'T WANT TO IMPLY THAT EVERYTHING'S BAD BECAUSE THERE ARE SOME SILVER LININGS IN THIS THAT THAT ARE VERY IMPORTANT TO MENTION.

THANK YOU. AND I HAD MENTIONED TO RICKY THAT WE MAY AT SOME POINT SAY, CAN YOU DUMB IT DOWN A LITTLE BIT FOR US AND LET'S NOT TALK ACCOUNTING PRINCIPLES.

AND YEAH, I PROMISE I WOULD NOT BE OFFENDED.

SO WHAT WAS EMAILED TO YOU AND I'M ASSUMING YOU ALL HAVE AN EMAIL COPY WAS BASICALLY TWO DOCUMENTS.

ONE IS THE ACTUAL REPORT ITSELF AND ONE IS A SMALLER THREE PAGE VERSION OF A DOCUMENT THAT JUST AS A MATTER OF PRACTICE, I'VE GOT KIND OF HAVE TO GO THROUGH THERE. BUT THERE ARE GOING TO BE A HANDFUL OF GOOD POINTS IN THERE THAT I HOPE GET YOU TO START THINKING ABOUT.

HEY, WHAT HOW IS THIS GOING TO AFFECT THE ACTUAL AUDIT REPORT AND THE NUMBERS BEING PRESENTED? SO I'M GOING TO START WITH THE THE SMALLER DOCUMENT AND IT'S CALLED THE GOVERNANCE LETTER.

I'LL I'LL SPEAK TO IT, THOUGH.

AGAIN, JUST JUST CONFIRMING WHY WE'RE HERE.

WE'RE HERE TO DISCUSS AUDIT FOR THE YEAR ENDED SEPTEMBER 30TH, 2022.

ALSO CONFIRMING THAT THAT THE AUDIT IN TERMS OF THE ROLE THAT WE PLAY IN THIS PROCESS IS PERFORMED UNDER GOVERNMENT AUDITING STANDARDS.

AGAIN, THAT'S ACCOUNTING SPEAK IN SOME REGARDS, BUT I JUST WANT YOU TO KNOW THE STANDARDS FOR WHICH WE NEED TO CONDUCT THE AUDIT, WHICH IS A HIGHER LEVEL THAN, SAY, IF YOU SAW AN AUDIT OF A NONPROFIT THAT DIDN'T HAVE GOVERNMENT RELATED FUNDS AND THINGS OF THAT NATURE.

SO WE ARE HELD TO TO A HIGHER STANDARD IN THAT REGARD.

AND THEN THERE'S A SECTION CALLED SIGNIFICANT AUDIT MATTERS, AND IT SPEAKS TO MANAGEMENT'S RESPONSIBILITY.

A LOT OF FOLKS THINK THAT THE AUDIT REPORT ITSELF IS OURS.

OUR OBJECTIVE IS TO AUDIT THE REPORT, NOT TO NECESSARILY PREPARE THE REPORT.

IN FACT, THE ACTUAL REPORT ITSELF WAS ACTUALLY PREPARED BY CITY STAFF.

CERTAINLY THERE WAS A LOT OF BACK AND FORTH BECAUSE THERE WERE SOME THINGS THAT WE SAW THAT WEREN'T CORRECT.

BUT AT THE END OF THE DAY, IT'S MANAGEMENT'S RESPONSIBILITY.

I WANTED TO MENTION THAT JUST JUST SO YOU KNOW.

YOU KNOW, OUR OUR PROFESSION IS EVOLVING JUST LIKE EVERYBODY'S PROFESSION.

AND THERE'S, YOU KNOW, THERE'S ALWAYS SOMEBODY NEW YORK THAT THINKS WE GOT TO MAKE IT MORE DIFFICULT THAN IT HAS TO BE.

AND SO IF IF YOU EVER HAD AN AUTO PRESENTATION THIS PAST YEAR, YOU MAY HAVE NOTICED OR MAYBE THEY MENTIONED ABOUT A NEW LEASE STANDARD ACCOUNTING FOR LEASES, THAT'S A BIG THING.

AND AND NOT ONLY IN THE FOR PROFIT WORLD, BUT NONPROFIT WORLD AND GOVERNMENTAL.

BUT JUST TO ACKNOWLEDGE THAT THERE IS A NEW STANDARD IN THIS PARTICULAR YEAR.

THE SILVER LINING IS IN YOUR CASE, IT'S NOT SIGNIFICANT ENOUGH FOR US TO EVEN CONSIDER, BUT WE JUST NEED FOR YOU ALL TO BE AWARE THAT LEASES ARE THERE IS A LEASE STANDARD.

TO THE EXTENT THAT YOU GET INTO SOMETHING IN THE FUTURE THAT IS SIGNIFICANT.

ALSO, JUST ACKNOWLEDGING THAT AS MUCH AS IN EVERY AUDIT REPORT AND EVERY ACCOUNTING DEBITS EQUAL CREDITS AND SO THAT SEEMS LIKE A SCIENCE.

[00:20:02]

THEY SHOULD ALWAYS AGREE.

THERE ARE ESTIMATES ASSOCIATED WITH SOME OF YOUR NUMBERS.

AND SO LET'S TALK ABOUT THE BIGGER ESTIMATES IN ANY AUTO REPORT AND REALLY SPECIFICALLY AS IT PERTAINS TO YOUR AUTO REPORT, ONE IS MANAGEMENT'S ESTIMATE OF THE COLLECTIBILITY OF NOTES RECEIVABLE WITH YOUR BIGGEST NOTES RECEIVABLE BEING THE SANTANA TEXTILES RECEIVABLE.

BUT THERE'S AN ESTIMATE THERE AS TO WHETHER YOU'LL BE ABLE TO COLLECT YOUR MONEY BACK, ALSO TO DEPRECIATION AND THINGS OF THAT NATURE, TRYING TO FIGURE OUT THE USEFUL LIFE OF AN ASSET THAT'S SOMEBODY'S BEST GUESS.

ALSO TO JUST, JUST JUST REMEMBER THAT IF YOUR BOTTOM LINE ORIENTATED, YOU'RE PROBABLY THE TYPE OF INDIVIDUAL WHO'S GOING TO GO STRAIGHT TO THE BOTTOM LINE AND SAY, OKAY, WELL, ARE WE ARE WE GOOD OR NOT? DO WE MAKE MONEY OR DID WE NOT MAKE MONEY? AND THOSE ARE GOOD METRICS AND I'M GOING TO SPEAK ABOUT THOSE.

BUT JUST DON'T FORGET THAT THE FOOTNOTES IN THE BACK THERE ARE IMPORTANT.

IF YOU EVER HAVE A CHANCE, YOU KNOW, WHEN YOU HAVE NOTHING TO DO BUT TO READ AN AUTO REPORT, THEY ARE IMPORTANT AS GOOD INFORMATION BACK THERE.

AND SO PLEASE DON'T DON'T DON'T EVER IGNORE THEM.

OKAY. I WANT TO TURN THE PAGE AND I'M GOING TO TALK TO THE FIRST POINT THAT'S ON THERE.

AND IT SAYS DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT.

SO IT'S NOT IT'S NOT A GOOD PRACTICE TO HAVE A SEPTEMBER 30TH, 2022 AUTO REPORT PRESENTED TO YOU IN AUGUST.

I THINK, GENERALLY SPEAKING, YOU DON'T HAVE TO BE AN ACCOUNTANT, YOU KNOW, YOU KNOW, TO TO TO KNOW THAT.

AND FOR THOSE THAT ARE NOT FAMILIAR WITH AUTO PROCESS, SOMETIMES, YOU KNOW, IT'S THE AUDITOR'S FAULT.

YOU KNOW. WELL, THEY DIDN'T GET THEY DIDN'T GET THE OPPORTUNITY TO TO THEY DIDN'T THEY DIDN'T THEY DIDN'T DO THEIR JOB.

THE COMPLETION OF OUR AUDIT WAS SIGNIFICANTLY DELAYED GIVEN THE TIMING OF WHICH INFORMATION WAS PROVIDED TO US TO BEGIN OUR AUDIT DUE TO TURNOVER IN THE CITY'S FINANCE DEPARTMENT, AS WELL AS ACCOUNTING ISSUES IDENTIFIED IN MANAGEMENT'S PROCESSES FOR PREPARING FOR THE AUDIT.

MANAGEMENT WAS UNABLE TO PROVIDE A TRIAL BALANCE TO US UNTIL APRIL 14TH, 2023.

WHY ARE WE WHY ARE WE STILL TALKING ABOUT THIS IN AUGUST? WELL, ONCE WE GOT THE TRIAL BALANCE, WE STILL NEEDED INFORMATION TO AUDIT, RIGHT? WE ONLY AUDIT WHAT THE CITY CAN PROVIDE.

AND IT TOOK THAT LONG IN ORDER FOR US TO BE ABLE TO COMPLETE THE AUDIT.

AND SO, FOR EXAMPLE, I MENTIONED AND I JUST THIS IS AN EXAMPLE I MENTIONED THE CITY'S RESPONSIBLE FOR PREPARING THE AUDIT.

THEY THEY SENT US A DRAFT, THEIR FIRST ITERATION OF THE DRAFT ABOUT FOUR WEEKS AGO.

AND ADMITTEDLY, I THINK THEY WOULD AGREE IT WAS NOT IN GOOD SHAPE.

AND SO WE SENT THEM BACK HOME WITH AN ENTIRE NEW REPORT AND JUST TOOK THEM THAT LONG TO GET US SOMETHING THAT WE COULD WORK WITH.

THAT'S A NORMAL PART OF THE PROCESS, BUT IT'S NOT NORMAL TO BE HERE DURING THIS TIME.

AND SO I JUST WANTED TO TO ACKNOWLEDGE THAT AND KNOW THAT WE AS SERVICE PROVIDERS ARE ALWAYS INTERESTED IN MAKING SURE THAT YOU GET SOMETHING TIMELY.

OKAY. DOES ANYBODY HAVE A QUESTION ABOUT THAT POINT? JUST FOR CLARITY AND FOR US ON THE BOARD.

SO LAST YEAR DURING THAT TIME THAT YOU NOTED, WE WERE PAYING THE CITY.

FOR THIS FOR AUDITING AND ACCOUNTING, IS THAT CORRECT? YES. SO SO WE WERE WE WERE PAYING THE CITY.

AND YOU FAILED TO GET THE PROPER INFORMATION THAT YOU NEEDED.

OBVIOUSLY, IF YOU'RE GETTING IT IN APRIL OR FOUR WEEKS AGO, WE'RE DELAYED SO THAT WE KNOW THAT.

AND WHAT WHAT CONVERSATIONS DO WE HAVE WITH WITH WITH CITY COUNTY STAFF OR WHAT HAVE YOU? WELL, THEY WERE ALSO CONDUCTING THE CITY AUDIT AT THE SAME TIME.

THAT'S A WHOLE DIFFERENT.

I'M MORE CONCERNED ABOUT THE EDC AUDIT BECAUSE THAT'S WHAT WE'RE PAYING FOR.

RIGHT. NOT NOT THE CITY AUDIT.

WELL, THEY WERE AWARE THAT WE WANTED THE AUDIT DONE.

BUT WE PAID FOR I MEAN, WE PAID OUR.

WE PAID FEES, RIGHT? YES. ALL RIGHT.

YEAH, WE HAVE PAID.

AND I KNOW THAT AND CORRECT ME IF I'M WRONG, I THINK EVEN GETTING SOME REPORTS TO THE EDC ON BALANCE SHEET AND LOOKING MONTHLY WHEN WE MEET, BEING ABLE TO HAVE A GOOD ASSESSMENT OF THE FINANCES HAS BEEN SOMEWHAT PROBLEMATIC TO THIS DATE.

WE HAVE NOT GOTTEN A FULL ACCOUNTING OF THE BALANCE SHEETS AND PROFIT AND LOSS STATEMENTS.

WE'VE BEEN CREATING IT ON OUR OWN FROM THE SOFTWARE PROGRAMS THAT'S OUT THERE.

YOU'RE BASICALLY GETTING ALL THE RAW DATA AND THEN HAVING TO PUT TOGETHER SOMETHING.

OKAY. YES. THANK YOU.

AND THE REASON WHY I BRING IT UP, WE JUST HAD A $100,000 REQUEST FROM SOME.

WE DON'T EVEN KNOW IF WE EVEN HAVE THAT.

AND MR. LONGORIA. BUT YOU'RE NOT. THAT'S CONCERNING.

YEAH. I MEAN, YOU KNOW, IT'S UNFORTUNATE THAT, YOU KNOW.

I'M AN ACCOUNTANT, BUT I'M ALSO A HISTORIAN, RIGHT?

[00:25:02]

BECAUSE EVERYTHING WE DEAL WITH IS IN THE PAST.

BUT YOU'VE GOT TO.

YEAH, HISTORY IS IMPORTANT TO YOU ALL.

BUT YOU ARE MAKING DECISIONS TODAY, RIGHT? YOU KNOW, SPENDING $100,000 IS NOT AN INSIGNIFICANT AMOUNT.

SO I, LIKE YOU, WOULD WANT TO HAVE KNOWLEDGE AS TO WHERE WE AT TODAY.

YEAH, THIS IS IMPORTANT.

AND YES, YOU HAVE TO HAVE IT DONE AND THINGS OF THAT NATURE.

BUT THE BEST INFORMATION FOR YOU ALL TO MAKE DECISIONS ON IS REALLY THE MOST CURRENT INFORMATION TODAY.

AND IF IT'S NOT BEING PRESENTED AND THAT'S SOMETHING OBVIOUSLY IT NEEDS TO BE ADDRESSED.

SO. SO. SO THE NEXT PART TALKS ABOUT CORRECTED AND UNCORRECTED MISSTATEMENTS.

AND HERE'S WHERE I CAN GET SPEAKING LIKE LIKE AN ACCOUNTANT.

SO I JUST WANT YOU JUST TO CONCEPTUALIZE THIS CONCEPT.

OKAY. AND LOOKING AT LAST YEAR'S REPORT.

OKAY. THERE WAS APPROXIMATELY 17 TO $18 MILLION WORTH OF ERRORS IN THAT REPORT IN TERMS OF THINGS THAT ARE BEING PRESENTED. OKAY.

AND THAT'S NOT A GOOD THING.

I'M GOING TO GIVE YOU THE SILVER LINING HERE IN A MINUTE.

RIGHT. BUT THAT'S NOT A GOOD THING.

OKAY. SO SO THAT SPEAKS TO THAT DETAIL.

I'M NOT GOING TO GO TO THE COUNTY SPEAK, BUT JUST CONCEPTUALLY, BECAUSE I WANT TO WALK YOU THROUGH WHERE THOSE ERRORS LIE.

OKAY. UH, DISAGREEMENTS WITH MANAGEMENT.

AS CHALLENGING AS IT WAS, WE HAVE REALLY, YOU KNOW, TRYING TO, TO CONDUCT THIS AUDIT.

AND, YOU KNOW, OBVIOUSLY THE CITY'S AUDIT SINCE DECEMBER OF 2022.

WE HAVE MET WEEKLY WITH STAFF TRYING TO GET THIS OUT.

AND SO CERTAINLY FROM OUR SPIRIT, I THINK THAT ACTION INTO ITSELF SPEAKS FOR ITSELF AND TRYING TO PROVIDE THE LEVEL OF SERVICE WE BELIEVE YOU DESERVE.

UM, BUT AT THE END OF THE DAY, IN THAT PROCESS, YOU KNOW, THERE WAS NO INFIGHTING, IF YOU WILL.

AND I JUST WANT TO CONFIRM THAT, UM.

REALLY? THAT'S ALL I REALLY WANTED TO COVER ON THIS LETTER.

THERE'S OTHER THINGS IN THIS LETTER THAT MAY CATCH YOUR EYE.

SO BEFORE I MOVE ON, IS THERE ANYTHING ON THIS LETTER THAT YOU'D LIKE TO TALK ABOUT? I HAVE A QUESTION. WHAT TYPE OF COMMUNICATION WERE YOU HAVING WITH THE STAFF WITH REGARDS TO THE PROBLEMS YOU WERE HAVING? YEAH. SO THE EMAIL.

THE PHONE CALL. YEAH. SO.

SO WHAT WHAT WE LEARNED IS THAT THE BEST KIND OF COMMUNICATION, IF IT'S NOT GOING TO BE ONE ON ONE, IT'S GOT TO BE VIA ZOOM.

OKAY. THAT'S THE WORLD WE LIVE IN.

SO EVERY FRIDAY AND THEY SET THE DATE AND TIME, NOT US EVERY FRIDAY SINCE SINCE DECEMBER WE'VE HAD A STANDING 3:00 PM CALL WITH CITY STAFF TO FIND OUT WHERE YOU'RE AT.

OKAY, TALK ABOUT WHAT'S THE PROGRESS WHERE WE'RE AT.

BECAUSE IF YOU CAN IMAGINE WHEN WE WERE ENGAGED, WE I MEAN, WE HAVE HUMAN RESOURCES, BUT WE CAN'T BE ON CALL OURSELVES.

RIGHT. AND SO OUR TIME FOR THIS AUDIT WAS ACTUALLY SCHEDULED BACK IN THE SPRING BECAUSE THAT'S WHEN WE AGREED TO DELIVER THE AUDIT AND BEEN ABLE TO DO SO.

SO THAT PUTS US, YOU KNOW, IN AN ON CALL POSITION.

AND SO HAVING THOSE WEEKLY MEETINGS ALSO TELLS ALLOWS US TO SCHEDULE STAFF, OKAY, THEY'RE FURTHER AHEAD THAN WE THINK THEY ARE AND THINGS OF THAT NATURE.

THERE ARE ALWAYS, I WANT TO SAY FACE TO FACE, BUT IN THIS WORLD, ZOOM IS ALMOST FACE TO FACE.

OKAY. WE ALSO HAVE JUST SO YOU KNOW, WE HAVE SYSTEMS IN PLACE THAT TRACK OUR REQUEST AND THEIR SUBMISSIONS.

SO I COULD PRINT YOUR REPORT THAT SHOWS, HEY, WE WE ASKED FOR THIS BACK IN.

I'M TOTALLY MAKING UP A DATE ON JANUARY 15TH AND THE SYSTEM WILL SHOW YOU.

WE GOT IT IN JUNE 15TH.

RIGHT. SO THERE'S NO QUESTION, NO FINGER POINTING ABOUT, HEY, YOU KNOW, I GAVE IT TO YOU.

YOU LOST IT. NO.

WE HAVE SYSTEMS IN PLACE TO ENSURE THAT EVERYBODY'S ACCOUNTABLE FOR THE ENTIRE PROCESS.

OKAY. CAN YOU CLARIFY IN TERMS OF MR..

LONGORIA, YOU SAID YOU WERE MEETING WITH STAFF.

OBVIOUSLY, YOU'RE AUDITING THE EDC DEPARTMENT, CORRECT? THAT INCLUDE EDC STAFF IN THOSE? YEAH. SO SO SO THE ACCOUNTING STAFF THAT'S ASSIGNED TO YOU ALL THE SAME ACCOUNTING STAFF AS TO THE CITY.

SO THAT ONE MEETING INCORPORATED BOTH TOPICS.

A WELL INCORPORATED BOTH TOPICS BUT INCLUDED STAFF FROM BOTH ENTITIES.

YEAH. SO AGAIN THE ACCOUNTING STAFF IS THE SAME.

YEAH. RIGHT.

BUT OUR STAFF, EDC STAFF.

YEAH. WELL AGAIN, BECAUSE WE DON'T HAVE AN ACCOUNTING DEPARTMENT, SO TO SPEAK.

WELL YEAH. LET ME WAS THERE AN IN.

OKAY THAT'S THAT'S WHAT YOU'RE REFERRING TO STAFF CORRECT.

YEAH LET THE NOW WORKS FOR THE EDC BUT DIDN'T THEN.

RIGHT AND TO AND TO BE HONEST WITH YOU WHEN IT COMES TO THE YOU KNOW THE DETAILS OF THE AUDIT I'M GOING TO CALL, YOU KNOW, THE NUTS AND BOLTS OF THE AUDIT THAT'S USUALLY DONE BY THE PEOPLE WHO HANDLE THE BOOKS.

RIGHT. YOU KNOW, TRYING TO FIGURE OUT I NEED RECONCILIATIONS, I NEED THIS.

SO THAT'S WHY IT WAS THOSE FOLKS.

I THINK I THINK HE'S REFERRING TO FINANCE.

IF YOU'RE TALKING ABOUT FINANCE DEPARTMENT.

YES. YES. THE REASON WHY I POSED THE QUESTION THAT THERE IS A DOCUMENT YOU NEEDED OR WHAT HAVE YOU, WOULD YOU PAY, YOU KNOW.

START WITH, HEY, I CAN GET YOU THAT VERSUS FINANCE DEPARTMENT BECAUSE WE MAY MAYBE SPEND IT.

[00:30:04]

DONATED. YEAH, WE COULD HAVE HELPED YOU ALONG THAT PROCESS.

YEAH. SO? SO WHEN WE WERE ENGAGED, YOU KNOW, THERE WAS ONE CITY FINANCE DIRECTOR, THEN YOU HAD AN INTERIM CITY FINANCE DIRECTOR, AND THEN YOU HAD.

AND IN THOSE INSTRUCTIONS, WE WERE INSTRUCTED THE MOST EFFICIENT WAY WOULD BE TO GO THROUGH THEM BECAUSE THEY'RE THE ONES.

THEY'RE THE ONES MAINTAINING THE BOOKS AND RECORDS IF THERE'S A MORE EFFICIENT WAY.

AND IF YOU SUGGEST, HEY, NEXT YEAR, YOU KNOW, DO X, OF COURSE WE'LL CONSIDER THAT IN THE PROCESS.

YEAH. NO, AND JUST SO YOU KNOW, AND I THINK YOU DO, YOU KNOW, WE OUTSOURCE THAT TO THE CITY AND PAID A FEE AND THEN SO WE JUST I JUST DON'T KNOW IF A LOT OF TIMES IT FILTERS DOWN TO WHERE WHEN SOMETHING IS NEEDED, IT GETS DIRECTLY.

THAT MESSAGE GETS DIRECTLY TO EDC STAFF TO PULL SOMETHING OR IF IT'S JUST COMING FROM FINANCE DEPARTMENT CITY.

BASED ON. I GUESS INSIGHT IS NOT NECESSARILY SOMETHING THAT THE STAFF WOULD ACTUALLY NEED TO PROVIDE BECAUSE ALL THOSE DOCUMENTS ARE MAINTAINED AT THE FINANCE DEPARTMENT.

AND SO IT WOULD BE THE FINANCE DEPARTMENT THAT WOULD NEED TO.

IT WOULD BE UNLESS EDC GOT A GRANT AND THE GRANT FILES WERE HOUSED AT EDC, THEN THEY MIGHT HAVE A COPY OF THAT REPORT OR THAT COMPLIANCE. BUT OUTSIDE OF THAT, EVERY SINGLE PIECE WOULD BE WITH THE FINANCE DEPARTMENT.

I THINK IT'S MORE FROM A COMMUNICATION PERSPECTIVE.

THIS IS THE FIRST TIME I HEAR THAT WE HAVE ISSUES AND THAT'S SOMETHING THAT I WAS GOING TO GO TO AS WELL, THAT I THINK IT'S IMPORTANT THAT WE FIND OUT EARLIER WHEN WE'VE GOT A PROBLEM LIKE THIS, BECAUSE LIKE YOU SAID, EVERY DECISION THAT WE MAKE IS BASED ON HOW WE THINK FINANCIALLY.

WE'RE SITTING, YOU KNOW, AND HERE WE ARE TRYING TO MAKE THINGS HAPPEN AND AND WE MIGHT NOT EVEN HAVE THE MONEY FOR IT.

SO SO, YEAH, IT'S, IT'S IMPORTANT THAT WE FIND OUT EARLIER.

ANY OTHER QUESTIONS ON THIS PART? OKAY. MOVING ON THEN LET'S LET'S LET'S JUMP OVER TO THE FINANCIAL STATEMENTS THEMSELVES.

SO I'M GOING TO JUMP TO PAGE ONE, WHICH IS.

IS OUR LETTERHEAD. OKAY.

AND SO SO THIS IS A GOOD NEWS, RIGHT? SO, SO WITHOUT READING THROUGH ALL THE PARAGRAPHS AND THINGS OF THAT, I WILL SUMMARIZE BY SAYING THAT THAT, YOU KNOW, OUR JOB WAS TO RENDER AN OPINION ON THE FINANCIAL STATEMENTS.

OF COURSE THEY HAVE BEEN ADJUSTED TO TO THE TO WHERE WHERE WE FEEL COMFORTABLE RENDERING AN OPINION.

AND SO SO WE HAVE RENDERED RENDERED AN OPINION WHICH IS CONSIDERED AN UNMODIFIED OPINION AND THAT'S THAT'S AUDITING SPEAK NON AUDITING SPEAK WOULD BE IT'S A CLEAN OPINION. OKAY BUT WHAT ENTIRELY DOES THAT MEAN IT ALL? IT DOESN'T MEAN THAT EVERY SINGLE NUMBER IS RIGHT OR ANYTHING LIKE THAT OR THAT WE EVEN LOOKED AT IT EVERY SINGLE TRANSACTION BECAUSE THAT'S NOT THE WAY AN AUDIT IS CONDUCTED.

WHAT IT DOES MEAN TO SAY IS THAT THE NUMBERS THAT ARE BEING PRESENTED AND WE'RE GOING TO GO THROUGH THIS NUMBERS ARE FAIRLY PRESENTED IN ALL MATERIAL RESPECTS.

NOT AN EXACT NOT EVERY EXACT NUMBER.

IMAGINE WE HAD AN AUDIT.

EVERY EVERY SINGLE TRANSACTION WE'D STILL BE AUDITING MAYBE.

BUT BASED UPON OUR TASKS PERFORMED ACCORDING TO THE STANDARDS, WE ARE RENDERING AN UNMODIFIED I.E.

CLEAN OPINION ON THESE NUMBERS FOR THE EDC.

OKAY THERE. I WILL SAY THAT THERE IS ONE ONE PARAGRAPH IN HERE THAT'S CALLED AN EMPHASIS OF MATTER PARAGRAPH.

OKAY. NOW THAT THAT'S A LITTLE DIFFERENT THAN YOU MAY SEE IN SOME OF THE OTHER REPORT.

AGAIN, JUST REMINDING THE READER.

ABOUT THAT NOTE RECEIVABLE FROM FROM SANTANA TEXTILES THAT IF YOU DON'T COLLECT IT RIGHT NOW, IT'S SITTING AT ABOUT 13% OF YOUR TOTAL ASSETS.

AND SO JUST HIGHLIGHTING, HEY, HEY, READER, AS YOU GO THROUGH THIS, JUST REMEMBER THIS NUMBER.

SO THAT TYPE OF DISCLOSURE IS ACTUALLY SIMILAR TO WHAT YOU'VE HAD IN THE PAST.

SO THAT SHOULD NOT BE UNUSUAL FOR THOSE THAT HAVE BEEN HERE FOR A BIT.

YES. THANK YOU. WE'RE ALL TOO FAMILIAR WITH THAT DEBT.

OKAY. OKAY, SO PAGE THREE.

PAGE THREE, FOUR, FIVE AND SIX, SEVEN.

I'M GOING TO SKIP. I WILL SAY THAT IF YOU HAD AN OPPORTUNITY TO READ IT AGAIN, IT'S THE CLIFF NOTES VERSION OF KIND OF WHAT YOU'VE DONE AND HOW NUMBERS COMPARED TO LAST YEAR.

SO I'M GOING TO JUMP INTO PAGE TEN.

OKAY. AND HERE'S.

I'M NOT GOING TO ASSUME ANYTHING WHEN I SAY THIS.

SO JUST IF I. OKAY.

SO THE FINANCIAL STATEMENTS FOR THE EDC ARE PRESENTED UNDER A STANDARD CALLED GOVERNMENT AUDITING STANDARDS.

THERE ARE DIFFERENT STANDARDS FOR WHICH FINANCIAL STATEMENTS CAN BE PRESENTED EXCEPT THAT ACCEPT EXCEPT THAT THAT FOR US GOVERNMENT AUDITING STANDARDS.

AND SO THAT REQUIRES A PRESENTATION OF TWO STATEMENTS.

OKAY. ONE IS CALLED A STATEMENT OF NET POSITION AND ONE IS CALLED A BALANCE SHEET.

OKAY. PAGE TEN IS YOUR STATEMENT OF NET POSITION.

[00:35:02]

OKAY. BUT THAT STATEMENT IS SUPPOSED TO TRY AND PRESENT IS, HEY, IF YOU WERE A BUSINESS, IF YOU'RE A BUSINESS, WHAT WOULD THIS ENTITY LOOK LIKE? OKAY. AND SO ON PAGE TEN, YOU HAVE THAT STATEMENT OF NET POSITION.

OKAY. AND YOU'LL SEE AT THE VERY BOTTOM OF YOUR BOTTOM LINE DRIVEN TOTAL NET POSITION OF 17,000,340.

$17,340,000. OKAY.

AND THE NUMBER I WANT YOU TO TO SEE, BECAUSE IT WASN'T LIKE THIS LAST YEAR, WAS THAT UNRESTRICTED BALANCE OF 9,668,081.

OKAY. IF YOU'RE LOOKING AT NET POSITION AND YOU CAN EQUATE IT TO EQUITY OR WHATEVER THINGS OF THAT NATURE, YOU DON'T NECESSARILY WANT TO SEE A NEGATIVE NUMBER THERE. RIGHT? NORMALLY, YOU WOULD THINK THAT THAT'S THAT'S NOT A GOOD THING.

OKAY. IN YOU ALL'S CASE, IT IS UNDERSTANDABLE.

AND WHAT I MEAN BY THAT IS THINK ABOUT.

THE TRANSACTIONS THAT YOU ALL ARE HAVING SPECIFICALLY AS IT RELATES TO THE CITY.

RIGHT. AND I'M GOING TO USE IT AS AN EXAMPLE.

MY GRANDMOTHER USED TO LIVE BY A DO LIST.

SO THAT'S THE ONE THAT THAT THAT RINGS TRUE TO ME.

OKAY. SO SO ANYTIME YOU ENTER INTO A TRANSACTION.

RIGHT NOW, THE CITY WHEREBY YOU'RE BUILDING, CONSTRUCTING SOMETHING FOR THE FOR THE INTENDED PURPOSE, THAT ONCE THAT ASSET IS COMPLETE, THAT YOU WILL TURN OVER THAT ASSET FOR SOMEBODY TO MAINTAIN.

IT'S THEIR DEAL.

OKAY. WELL.

WELL, YOU NO LONGER HAVE THAT ASSET.

SO YOU EXPENDED CASH OR INCURRED DEBT, RIGHT, TO BUILD THAT ASSET.

BUT THEN AT THE END OF THE PROJECT YOU JUST GET RID OF IT.

SO YOU'RE LEFT AND IF IT WAS DEBT, YOU'RE LEFT WITH A DEBT AND NO ASSET.

AND SO WHAT THAT DOES IS IT CREATES A NEGATIVE EQUITY LIKE IT DOES THAT NUMBER.

OKAY. IT IS NOT UNUSUAL.

OKAY. SO I WANT YOU TO IT IS NOT UNUSUAL.

WE'VE SEEN IT. OKAY? BECAUSE THAT'S THAT'S THE WAY ACCOUNTING WORKS.

IF YOU GIVE IF YOU BUILD AN ASSET AND YOU TURN IT OVER AND YOU'RE LEFT WITH DEBT, OF COURSE YOU'RE GOING TO HAVE NEGATIVE EQUITY.

SO I WANT TO I WANT TO POINT THAT OUT.

I ALSO WANT TO POINT OUT THAT IN DEVELOPING THIS STATEMENT.

THERE IS APPROXIMATELY $18 MILLION WORTH OF CORRECTIONS FLOWING THROUGH HERE.

OKAY. LET ME GIVE YOU THE CRUX OF THE BIGGEST ONE.

OKAY. THERE WERE SOME REFUNDED DEBT.

THAT WAS A 2015 DEBT THAT WAS REFUNDED.

AND IN LAST YEAR'S AUDIT REPORT WHERE THE AUDITOR EXPRESSED AN UNMODIFIED OPINION, OKAY, THAT DEBT WAS GONE, THAT DEBT WAS PUT IN PROCEEDS, IT WAS REFUNDED AND MONIES WERE PUT IN ESCROW FOR THIRD PARTY TO SERVICE THE DEBT, ETCETERA.

THAT'S JUST THE WAY THEY WORK.

THE ESCROW BALANCE AND THE DEBT BALANCE WERE NEVER TAKEN OFF THESE FINANCIAL STATEMENTS.

OKAY. SO YOU MENTIONED CASH, RIGHT? WELL, ESCROW MONEY WOULD HAVE BEEN RESTRICTED TO BEGIN WITH, SO YOU COULDN'T HAVE USED IT.

BUT MY POINT IS, IF YOU SAW CASH LAST YEAR, YOU WOULD HAVE SEEN THIS HIGH LEVEL OF CASH THAT YOU DIDN'T REALLY HAVE.

AT THE SAME TIME, YOU WOULD HAVE THIS HIGH LEVEL OF DEBT THAT YOU DIDN'T HAVE.

OKAY. THAT'S THAT'S THE BIGGEST ERROR THAT THAT FLOW THROUGH HERE.

AND THOSE WERE BONDS THAT WERE ISSUED BACK IN 2015 WERE REFUNDED BOND 2015 REFUNDED BONDS THAT THAT EVEN THOUGH YOU REFUNDED THEM REFUNDED BY DEFINITION YOU YOU'VE GONE AND YOU PLACED THEM IN ESCROW FOR SOME AND THEY'RE KIND OF OFF YOUR BOOKS RIGHT AND SO.

THAT DEBT STILL STAYED ON THE BOOKS.

AND SO THAT DEBT IS NO LONGER PRESENTED HERE.

IT'S 2022 WHERE THE TRANSACTION WAS MADE OR WAS IT WHEN IN THIS HISTORY WAS THAT DONE? WELL, I THINK WE KNOW IN 2010.

DO YOU REMEMBER WHEN IT WAS. 2021? IT WAS 2021.

YEAH. SO THE AUDIT FOR THAT TURNED INTO 2022 WAS FOR 2021.

YEAH, THAT'S TRUE.

YEAH. SO.

SO I'M SORRY.

GO AHEAD. OH, AND SO AND THERE'S OTHER THINGS THAT ARE GOING ON PAGE.

I ACTUALLY READ IT, BUT I THINK IT'S ON PAGE 31 WHERE IT KIND OF GOES THROUGH THE ADJUSTMENTS.

RIGHT. OKAY. AND IT KIND OF RECONCILES.

WHERE ARE THESE NUMBERS FROM? THERE'S SOME OTHER ADJUSTMENTS IN THEIR RECONCILIATION.

TALK ABOUT, HEY, SANTANA WASN'T PROPERLY ALLOWED.

SO WE GOT PAST ALL THAT.

AND SO SO NOW WE'RE LEFT WITH THIS.

I WILL SAY, JUST AS AN ASIDE, YOU KNOW, THERE WAS A DISCUSSION ABOUT.

LASHES REPORT IS LIKE MATERIALLY MISSTATED.

RIGHT? YOU KNOW, YOU GO BACK AND CORRECT THE PERMANENT RECORD.

RIGHT. TO MAKE IT TO TO MAKE IT RIGHT, BECAUSE IT IS IF SOMEBODY DIDN'T KNOW THIS AND JUST PULLED OUT THAT REPORT, THEY'D SIT THERE AND REACH A DIFFERENT CONCLUSION.

[00:40:07]

RIGHT. THERE WAS A DISCUSSION.

AND AT THE END OF THE DAY, IT WAS ABOUT CONSIDERING WHERE WE ARE TODAY WITH THIS REPORT, LET'S JUST MOVE FORWARD.

AND SO OBVIOUSLY, THAT'S UP TO YOU ALL TO DECIDE.

BUT BUT THAT'S WHAT HAPPENING.

THAT'S WHAT'S HAPPENING WITH THESE STATEMENTS.

OKAY. DOES THAT MAKE SENSE? GIVE YOU A BIG PICTURE ON THIS ONE.

OKAY. SO I'M GOING TO ASK YOU TO TURN TO PAGE 12.

SO. SO HERE'S MORE OF THE SILVER LINING PART OF IT.

OKAY. AS YOU MENTIONED ON PAGE 13, I'M SORRY, PAGE 31, IT GOES THROUGH THERE AND IT RECONCILES THESE DIFFERENCES.

AND YES, THOSE STILL IMPACT THIS PARTICULAR STATEMENT.

BUT IN A NORMAL INSTANCE, JUST IN JUST IN THE INTEREST OF TIME AND PRESENTING AN AUDIT REPORT, I WOULD TELL YOU THIS.

I WON'T TELL YOU IF YOU DON'T UNDERSTAND ANYTHING ABOUT AN AUTO REPORT SUCH AS THIS.

OKAY. UNDERSTAND ONE NUMBER.

OKAY. AND THAT IS WHAT YOU HAVE IN YOUR UNASSIGNED GENERAL FUND.

IF YOU DON'T UNDERSTAND ANYTHING ELSE, UNDERSTAND THAT NUMBER.

OKAY. TOO LOW.

IT GETS YOU IN TROUBLE. TOO HIGH.

YOU START WONDERING WHETHER, HEY, ARE WE DOING THE KIND OF THINGS WE'RE SUPPOSED TO BE DOING BECAUSE YOU'RE STARTING TO STARTING TO INCREASE, RIGHT? THESE ADJUSTMENTS DID NOT AFFECT THAT NUMBER.

SO IF I LOOK AT UNASSIGNED BALANCE OF 10.270, ALL OF THESE THINGS I'M TALKING ABOUT DID NOT AFFECT THAT NUMBER.

SO IF YOU WERE MAKING DECISIONS BASED UPON THAT NUMBER, THEN YOU WOULD HAVE BEEN OKAY.

I HAD A NOTE TO MYSELF.

THIS IS WHAT WE CAN SPEND.

QUESTION MARK. IS THAT OKAY? WELL, IT'S NOT NECESSARILY SPAN, BUT I MEAN, I'M NOT SAYING IT'S A CASH I'M NOT SAYING IT'S NOT A GOOD WAY TO CATEGORIZE IT.

BUT IS THAT WHAT WE HAVE? YOU KNOW, THOSE THAT SIT ON ON THE BOARD YOU KNOW, WHEN YOU LOOK AT UNASSIGNED FUND BALANCE, THERE'S ALWAYS A METRIC, RIGHT? LIKE WHAT'S THE RIGHT NUMBER, RIGHT.

IF I JUST SAID HAVING TOO LITTLE IS NOT A GOOD THING AND HAVING TOO MUCH IS PROBABLY NOT A GOOD THING TOO.

LIKE, WHAT'S THE RIGHT NUMBER? THERE'S A NUMBER OF DIFFERENT METRICS.

I'LL SAY, LOOK, IF YOU'VE GOT.

A TYPICAL METRIC WOULD BE, HEY, 60 DAYS OR 90 DAYS OF UNASSIGNED FAMILY.

I'VE HEARD THAT BEFORE, RIGHT? YEAH.

OKAY. WE WENT SIX MONTHS, I BELIEVE.

WELL, IF YOU LOOK IF YOU LOOK AT THIS REPORT AND THIS IS THE SILVER LINING.

SO IF YOU GO TO PAGE 14.

OKAY. AND IF YOU CAN FOCUS YOURSELF TO THE MIDDLE OF THE PAGE AND LOOK AT TOTAL EXPENDITURES.

EXPENDITURES TO INCLUDE PRINCIPAL AND DEBT AND CAPITAL OUTLAY.

OKAY, THAT NUMBER IS $9.5 MILLION.

ALL RIGHT. THE METRIC THAT I REFER TO IS ALWAYS, WELL, IF THE GOVERNMENT SHUT DOWN TODAY, HOW LONG COULD WE LAST? I SAID 60.

I SAID 90.

SOME SAY 20% OF EXPENDITURES.

YOU'RE CLOSE TO A YEAR.

YOU'RE CLOSE TO YOUR YEAR.

OKAY. AGAIN, SOMETIMES TOO LITTLE IS BAD, BUT SOMETIMES TOO MUCH IS BAD.

THAT'S WHERE YOU ALL TO DECIDE.

RIGHT. IF YOU HAVE TOO MUCH, THE ARGUMENT CAN BE MADE, WELL, YOU'RE NOT MOVING DOING THE KIND OF THINGS THAT YOU'RE EXPECTED TO DO QUICKER AND FAST ENOUGH.

RIGHT. THAT'S JUST A COMMENT, BUT IT'S AT THE PACE THAT YOU FEEL COMFORTABLE WITH.

SO FROM THAT STANDPOINT, AND IF YOU LOOK AT FINANCIAL HEALTH BASED UPON THAT NUMBER, THEN YOU ALL ARE PRETTY, PRETTY SOLID.

OKAY. AND TO ME, THAT'S THE IMPORTANT STORY AS IT RELATES TO THIS STATEMENT.

DOES ANYBODY HAVE A QUESTION ON THIS STATEMENT? COULD YOU SAY THAT STATEMENT A LITTLE MORE BOLDLY? NO MATTER THE ERRORS? YEAH. SO I'M GLAD YOU MENTIONED THAT, BECAUSE MY MY QUESTION ON THAT TYPE OF ERROR IS THAT DID THAT AFFECT IN ANY WAY THE EDC'S ABILITY TO FUND AND.

PROVIDE MONIES FOR ALL THE PROGRAMS THAT WE HAVE SINCE THEN.

AND DID THAT IN ANY WAY AFFECT ITS NO CAPACITIES? NO, NO. YOU KNOW, WE'RE WHERE THE ERRORS BECOME IMPORTANT BECAUSE I JUST SAID IF YOU KNOW, IF YOU'RE IF I'M SITTING IN YOUR CHAIR AND IF I'M NOT AN ACCOUNTANT AND I SAY, HEY, IF YOU DON'T KNOW ANYTHING ELSE ABOUT COUNTING, JUST FOCUS ON THIS ONE NUMBER.

THE PART ON FRONT THAT I JUST ALLUDED TO AND TALKED ABOUT, AND NOW YOU GOT THIS ALL THIS STUFF GOING ON.

IT'S REALLY FOR A THIRD PARTY REASON, RIGHT? SO ANYBODY THAT'S GOING TO ISSUE GIVE US GIVE YOU THAT WILL THEY WILL ASK ABOUT THAT NUMBER, RIGHT? BECAUSE THEN ANY MONEY THAT WE DIDN'T HAVE TO BUT FOR YOU ALL PURPOSES, YES, THAT'S IMPORTANT.

YOU CAN'T LOSE SIGHT OF IT.

YOU CAN'T YOU KNOW, I DON'T WANT TO MINIMIZE, BUT I'M I'M ALWAYS SAY, YEAH, UNASSIGNED, UNASSIGNED UNASSIGNED.

[00:45:07]

AND HERE YOU'VE GOT ALMOST A YEAR WORTH OF.

IMAGINE IF THE CITY HAD A YEAR'S WORTH OF EXCESS.

I MEAN. OH MY GOSH. YEAH, RIGHT.

THAT NUMBER IS IMPORTANT TO ME BECAUSE I, I KNEW I HAD HEARD IT BEFORE, AND I THINK I BROUGHT IT UP AT A CITY MEETING.

HEY, DON'T WE HAVE IT CLOSE TO A YEAR OF.

AND THEY'RE LIKE, YEA, NO WAY.

BUT IT WAS, IT WAS THE EDC THAT WE HAD A YEAR.

WE HAD A YEAR THAT WAS PLANNED.

BUT YEAH, YOU KNOW, AND I THINK THAT'S FROM, FROM MY VIEWPOINT, THAT'S WHY.

IT'S GOOD WHEN WE HAVE DIFFERENT EYES, DIFFERENT CONTRACTS, DIFFERENT PEOPLE THAT GET HIRED BECAUSE YOU NEED DIFFERENT EYES INSTEAD OF THE SAME.

THE SAME PEOPLE LOOKING AT THE NUMBERS.

AND I WILL SAY, YOU KNOW, WE'VE LEARNED A LOT IN THE PAST YEAR WITH NEW FINANCIAL ADVISORS, NEW FINANCE PERSONNEL, NEW AUDITORS. AND SO THANK YOU FOR ALL YOUR WORK AND EXPLAINING IT ALL.

CAN I ASK YOU A QUESTION? ABSOLUTELY. SO WITH FISCAL YEAR ENDING IN THE NEXT 30 DAYS OR SO, HAS THERE BEEN A DIFFERENCE IN COMMUNICATION FOR THE UPCOMING AUDIT THAT'S DUE OR IS THE PATTERN GOING TO REPEAT ITSELF? SO AGAIN, GOING BACK TO THOSE WEEKLY MEETINGS, THAT HAS BEEN A POINT OF DISCUSSION, YOU KNOW.

I CAN'T SPEAK FOR WHAT'S WHAT CITY STAFF IS DOING WITH RESPECT TO EDC AND THIS YEAR.

RIGHT. I WILL TELL YOU THAT OUR FOCUS WITH THEM IS LET'S GET THE CITY OUT.

BUT ALL OF US HAVE HAVE ACKNOWLEDGED, YOU KNOW, THIS IS AS SOON AS WE'RE DONE HERE.

WELL, GUESS WHAT? WE'RE JUST STARTING.

WE'RE GOING TO START AGAIN.

YOU KNOW. CORRECT. CORRECT.

AND THAT HAD A LOT OF SCHEDULING AND FEES.

BUT AT THE END OF THE DAY, IT DOESN'T JUST NEED TO BE DONE.

IT NEEDS TO BE DONE RIGHT.

THAT'S ALWAYS BEEN OUR PHILOSOPHY.

SO AND SO.

A QUESTION I HAVE IS WHEN THERE'S DELAYS LIKE THAT, YOU CAN BE REQUESTING INFORMATION FROM STAFF DAY TO DAY, CURRENT OBLIGATIONS, AT LEAST TO KEEP SOME SORT OF WORK GOING INSTEAD OF WAITING FOR REPORTS FROM OBVIOUSLY DELAYED REPORTS FROM FROM FINANCE STAFF THAT THAT IS HAVING ISSUES. YOU CAN BUT IT BECOMES, YOU KNOW, MAYBE A PHILOSOPHICAL DISCUSSION BECAUSE YOU GET THEM.

THERE'S ONLY SO MANY HOURS IN A DAY.

DO I WANT THEM FOCUSED, THOSE EIGHT HOURS ON JUST TRYING TO, YOU KNOW, GET THE PAST OR DO YOU WANT TO SPLIT THE HALF, FINISH THE PASS AND HALF YOU'D RATHER GET GET THE INFORMATION FROM THEM TO KNOW YOU'RE GOING DOWN THE RIGHT PATH.

WELL, I GET THAT. BUT WE DON'T KNOW WHAT WE DON'T KNOW.

AND SO IT'S IMPORTANT THAT IF WE ARE PUT ON NOTICE, WE CAN, YOU KNOW, LIGHT A FIRE OURSELVES AND MAKE SURE THAT THE RIGHT INFORMATION IS GETTING BECAUSE NOW IT'S THEY'RE REPRESENTING US IN A SENSE.

RIGHT. AND WE'RE PAYING FOR THAT REPRESENTATION.

AND SO WE WANT TO MAKE SURE THAT WHATEVER YOU NEED IS GETTING GETTING TO YOU.

AND SO IF IT MEANS, YOU KNOW, A PHONE CALL, THEN WE CAN THEN THE BOARD CAN TAKE ACTION TO SEE IF IF WE CAN MOVE THINGS ALONG.

PAGE 14. I'VE GOT THREE MORE THINGS AND I'LL WRAP IT UP HERE.

ON PAGE 14. AGAIN, IF YOU'RE ONE OF THOSE JUST BOTTOM LINE ORIENTATED.

AND HOW DO WE DO? WELL, OF COURSE THERE'S NET CHANGE IN FUND BALANCE IS, YOU KNOW, YOU PRETTY MUCH BROKE EVEN, RIGHT? EXPENDITURE IS PRETTY MUCH EQUAL TO REVENUES.

YEAH, IT'S -83,000.

BUT AS A PRACTICAL MATTER.

OH, EXCUSE ME. AS A PRACTICAL MATTER, YOU'RE BROKE EVEN.

OKAY. I WAS GOING TO POINT OUT THAT FOOTNOTE THAT THAT YOU MENTIONED, BUT I THINK WE'VE KIND OF.

UNDERSTOOD THAT. THERE WAS ONE OTHER FOOTNOTE I JUST WANT TO JUST BRING UP BEFORE I JUMP TO THE OTHER PART OF THE REPORT, AND THAT IS ON PAGE 30, JUST TO IDENTIFYING WHAT YOUR COMMITMENTS ARE LEVEL AT THAT TIME AND THE PROJECTS THAT YOU HAD REMAINING.

AND THEN AND THEN ALSO JUST IDENTIFYING JUST THE BENEFICIARY OF THOSE PROJECTS.

OBVIOUSLY YOU SEE VANGUARD AND MOSTLY CITY OF EDINBURG.

BUT THAT FOOTNOTE IS THERE IN CASE THAT INTEREST.

I HAD A QUESTION ON PAGE.

MAYBE YOU CAN EXPLAIN IT TO ME A LITTLE BIT.

PAGE 27 ON THE DEFEASANCE OF DEBT.

SO I DIDN'T KNOW WHETHER DEFEASANCE OF DEBT WAS.

AND I THOUGHT, OKAY, SO IT'S BASICALLY WHEN YOU VOID A BOND OR A LOAN ON A BALANCE SHEET, WHEN THE BORROWER SETS ASIDE CASH OR BONDS SUFFICIENT TO SERVICE THE DEBT, I LOOKED IT UP.

SO BASICALLY YOU YOU CAN VOID IT NOW BECAUSE YOU KNOW, YOU HAVE ENOUGH TO SET THAT ASIDE.

BUT WHAT DOES THAT MEAN IN TERMS OF THE 13 MILLION THAT YOU SAY REMAINS OUTSTANDING? SO THAT'S A 13 MILLION.

THAT'S. YOU WHEN YOU DO THAT, YOU TAKE MONEY THAT YOU HAVE AND YOU GIVE IT TO A THIRD PARTY.

RIGHT. TYPICALLY A TRUST DEPARTMENT AT A BANK.

RIGHT. AND SO WHEN YOU GIVE IT TO A THIRD PARTY, THEN THEY'RE RESPONSIBLE NOW FOR MAKING FOR FOR MAKING THOSE DEBT PAYMENTS FOR YOU.

[00:50:07]

AND SO ALL WE'RE DISCLOSING IS HOW MUCH ARE THOSE STILL OUTSTANDING THAT STILL NEED TO BE PAID.

SO THAT'S THE 13 MILLION THAT'S STILL OUTSTANDING.

OKAY. THEY'RE NOT THEY'RE NOT NECESSARILY ON YOUR BOOKS UNLESS UNLESS, FOR EXAMPLE, IF YOU HAD LIKE I'M MAKING UP A NUMBERS LIKE 9% DEBT AND THEN YOU GO GET 2% DEBT.

RIGHT? AND SO AND SO YOU WANT TO PAY OFF THAT 9%.

SO YOU TAKE ON NEW DEBT AT 2%.

YOU TAKE THE PROCEEDS AND PUT IT IN A TRUST DEPARTMENT OR SOMEWHERE, AND THEY CONTINUE TO SERVICE THAT DEBT FOR YOU.

AND YOU YES, YOU GOT DEBT, BUT NOW IT'S 2% DEBT.

OKAY, BUT THAT'S THE WAY IT ALSO REMOVED FROM BALANCE SHEET.

YEAH, AND THAT WAS THE ISSUE.

THAT WAS THE ISSUE THAT I WAS REFERRING TO THAT CAUSED THOSE THOSE ADJUSTMENTS.

IT WASN'T REMOVED.

YEAH. WHICH IS A PRIMARY FUNCTION OF THAT.

OR ONE OF THEM FOR THE PURPOSE TO GET IT OFF? YES. YES.

SO SO THE OTHER THING I WANTED TO I WANTED TO POINT OUT AND JUST ACKNOWLEDGE AND I'LL GO THROUGH THIS IN AS MUCH DETAIL AS YOU WOULD LIKE, BUT SO I'LL START HERE. AND IF IT'S SUFFICES, THEN THAT'S FINE.

SO ON PAGE 39 AND 40.

YOU'LL SEE. YOU'LL SEE A LETTER AND THAT LETTER IS REQUIRED.

IT'S REQUIRED UNDER, I MENTIONED EARLIER, GOVERNMENT AUDITING STANDARDS.

I GOT TO PUT TOGETHER A LETTER.

OKAY. AND ONE OF THE THINGS THAT SPEAKS TO IS, YOU KNOW, INTERNAL CONTROLS AND THINGS OF THAT NATURE.

AND HERE'S HERE'S WHERE FOR DEFICIENCIES IN INTERNAL CONTROLS ARE BEING IDENTIFIED.

RIGHT. AND AND THEY'RE BEING CATEGORIZED BETWEEN MATERIAL WEAKNESSES, WHICH ARE YOU KNOW, I DON'T WANT TO SAY THE WORST THING YOU CAN HAVE, BUT I'M JUST SAYING, IF YOU HAD TO RANK THEM, YOU KNOW, MATERIAL WEAKNESS WOULD BE THE MOST SEVERE AND THEN YOU'D HAVE SIGNIFICANT DEFICIENCIES WOULD BE THE NEXT.

AND THEN YOU HAVE OTHER COMMENTS.

OKAY. AND SO WE ARE REPORTING TO YOU.

23455. COMMENTS ONE THE FIRST ONE WHICH IS A MATERIAL WEAKNESS AND THE OTHER FOUR RELATE TO SIGNIFICANT, SIGNIFICANT DEFICIENCIES.

I CAN GO THROUGH. THIS IS.

I'M AT YOUR PLEASURE. SO IF.

YOU ALL HAVE SPENT THE TIME AND JUST WANTED JUST TO ABSORB THEM AND PERCOLATE DOWN AMONGST YOURSELF AND MANAGEMENT AND THAT'S TOTALLY FINE.

OR WE CAN GO THROUGH HERE ONE BY ONE.

BUT JUST I JUST WANT TO KNOW THAT THERE'S THINGS IN HERE THAT NEED TO BE CORRECTED.

AND WHAT YOU ALSO HAVE IS A RESPONSE FROM MANAGEMENT ON HOW THEY PLAN ON ADDRESSING THE MATTER.

YEAH, THOSE WERE THE ONES I KNOW FROM UNIVERSITY.

YOU NEVER WANT TO SEE A MATERIAL WEAKNESS ON ON ANYTHING OR EVEN THE SIGNIFICANT.

SO I THINK ON, ON NUMBER ONE, THE MATERIAL WAS THE ONE YOU TALKED ABOUT WHERE THERE WERE MISTAKES MADE IN, IN WHAT WAS STILL CARRIED OVER FROM THE.

YEAH. AND SO NOW AT LEAST WE KNOW THAT THOSE HAVE BEEN THERE'S THERE'S SOME TRANSPARENCY NOW THEY THEY KNOW THEY EXISTED.

THOSE HAVE BEEN REMOVED.

AND WE NOW HAVE A CLEAN SET IN THE SENSE THAT AND AND DEVELOPING INTERNAL CONTROLS TO ENSURE IT DOESN'T HAPPEN AGAIN.

BUT WE WANT TO MAKE SURE THAT IT DOESN'T HAPPEN AGAIN.

OKAY. UM, THE OTHER ONE HAD TO DO, WHICH I WASN'T SURE.

THE INVESTMENT POLICY, WHICH WAS NUMBER TWO.

UM, AND THAT WE DIDN'T COMPLY WITH THE PROVISIONS OF THE PUBLIC FUNDS INVESTMENT ACT BECAUSE WE DID NOT HAVE AN INVESTMENT POLICY IN PLACE FOR THE END OF SEPTEMBER 2022.

SO DO WE HAVE ONE NOW AND WAS THAT AN INVESTMENT POLICY? WAS THAT SOMETHING THAT THE CITY WAS DOING FOR US IN THEIR CAPACITY, OR IS THAT SOMETHING WE WERE SUPPOSED TO DO ON OUR OWN? WE CAN WE CAN ACTUALLY WE SHOULD HAVE AN INVESTMENT POLICY THAT MIRRORS THE CITY'S INVESTMENT POLICY.

BUT THE CITY DID NOT HAVE AN INVESTMENT POLICY.

YEAH. SO. SO. SO HERE.

SO HERE'S WHERE WE MAY BE SPLITTING SOME HAIRS.

RIGHT? SO YOU'RE YOU'RE A BORED CORPORATE.

YOU'RE SEPARATE ENTITY.

YES. RIGHT.

THE MAJORITY OF THE PEOPLE ON THIS ON THIS BOARD ARE NOT CITY APPOINTED, RIGHT? CORRECT. OKAY. SO SO YOU HAVE AN OBLIGATION, I THINK, TO HAVE YOUR OWN POLICY.

IT COULD BE THE SAME POLICY.

OKAY. BUT WE BELIEVE YOU HAVE AN OBLIGATION TO HAVE YOUR OWN POLICY.

AND IF YOU'RE GOING TO COMPLY WITH THE ACT, THERE ARE SOME OTHER THINGS RELATED TO INVESTMENT TRAINING AND THINGS OF THAT NATURE.

I'M NOT SUGGESTING IF YOU LOOK AT YOUR HISTORY OF INVESTING, IT'S PRETTY CONSERVATIVE.

JUST LIKE MOST ENTITIES.

IT DOESN'T HAVE TO BE OVERLY COMPLICATED OR OR WHATNOT.

BUT I DO THINK THAT THERE IS SOMETHING THAT YOU ALL SHOULD HAVE THAT'S DIFFERENT, BUT THERE IS SOME MAIN POINTS IN THERE IN TERMS OF DIVERSIFICATION, RISK TOLERANCE, POLICY.

I MEAN, THERE IS SOME THAT YOU SHOULD HAVE OBJECTIVE TO THE FUND.

[00:55:05]

SO ANYBODY WHO READS THAT AND WE'RE AGGRESSIVELY.

INVESTING IN SOMETHING.

IT'S IN THE POLICY.

SO WE'RE DOING WHAT WE'RE DOING.

YEAH, I THINK I THINK I THINK IT WOULD BE PRUDENT BECAUSE IT CERTAINLY COULDN'T HURT.

RIGHT. I THINK WE'D BE PRUDENT TO HAVE YOUR OWN POLICY.

RIGHT. SO JUST BASED ON, AGAIN, SOME PRIOR HISTORY IS ANNUALLY, THE BOARD CAN LOOK AT THE POLICY AND WE CAN ADOPT THE CITY'S POLICY.

BUT WE DO NEED TO MAKE A MOTION ON IT.

AND OR WE CAN ALSO ACTUALLY, IF WE CHOSE TO DEVELOP OUR OWN SEPARATE POLICIES, IF WE WANTED TO BE A LITTLE BIT MORE AGGRESSIVE THAN WHAT THE CITY POLICY HAS DONE, AND I'VE DONE BOTH IN THE PAST, BUT IT IS LIKE GETTING IT ON THE RECORD AND.

APPROVING IT. YEAH.

YEAH. NO, I THINK WE MOST DEFINITELY HAVE TO HAVE OUR OWN.

WE CAN LOOK AT WHAT THE CITY IS DOING, BUT WE WE SHOULD BE ABLE TO REVISE THAT IF WE DON'T LIKE WHAT THAT POLICY IS.

AND DON'T FORGET, THERE ARE OTHER ASPECTS OF THAT ACT RELATED TO TRAINING.

YEAH. SO, YEAH, NOTICE THAT IT SAID WE HAVE TO GO THROUGH A TRAINING AS WELL.

RIGHT? OKAY.

AND THEN YOU SAID ON THE, ON THIS OTHER ONE, THE OH THREE, THAT ONE WAS THE DISASTER RECOVERY PLAN.

CORRECT. AND YOU SAID THAT THE CITY HAD BEEN WORKING ON THAT.

IS THAT ANOTHER ONE OF THOSE WHERE WE DO OUR OWN.

YEAH, BECAUSE YOU'RE ACCOUNTING IS ON THEIR SYSTEM.

YEAH. IT WOULD SEEM TO ME THAT YOU WOULD WANT TO KNOW THAT YOUR DATA IS CAN BE RECOVERED.

THIS IS BASICALLY PROTECTING YOUR DATA.

RIGHT. RIGHT. AND SO AT THIS POINT TURN ALL THE CITY HASN'T IS WORKING ON TRYING TO GET THEIRS GOING.

BUT BY DEFAULT, THAT PUTS YOUR DATA AT RISK.

AND THEN THE LAST ONE WAS TO ASSURE ADEQUATE CONTROLS ARE IN PLACE.

LET ME SEE. WHAT WAS THAT ONE? YEAH. OH, FOR.

ADEQUATE CONTROLS IN PLACE FOR TIMELY COMPLETION SO THAT WE'RE NOT HAVING THIS ISSUE WITH LAST MINUTE TURNOVER OF DOCUMENTATION AND SO FORTH.

OKAY. I WILL SAY THIS ONLY BECAUSE YOU MENTIONED THE WORD.

TURN OVER BECAUSE I DON'T WANT TO MINIMIZE THIS POINT.

IS, I DON'T KNOW, TEN YEARS AGO.

ACCOUNTS WERE GENERALLY EASY TO FIND.

OKAY. BUT IT IS A REAL THING THAT ACCOUNTANTS ARE EXTREMELY DIFFICULT TO FIND.

SO I'M NOT MAKING EXCUSES FOR THIS CITY.

BUT I JUST WANT TO TELL YOU THAT THAT IS A REAL THING.

A REAL CHALLENGE.

THE WALL STREET JOURNAL HAS WRITTEN ABOUT IT MORE THAN ONCE ABOUT JUST A LACK OF ACCOUNTANTS AND THE IMPACT IT'S HAVING NOT JUST ON GOVERNMENTAL ENTITIES, BUT NOW IT'S STARTING TO AFFECT, YOU KNOW, PUBLIC COMPANIES.

AND SO I JUST WANT TO JUST IT'S A REAL THING.

DON'T DON'T JUST SAY, OH, JUST GO HIRE SOME PEOPLE.

WELL, NO, THAT'S NOT WELL.

AND I KNOW I MEAN, THE CITY HAS BEEN IN THE PROCESS OF THEY HAD BEEN LOOKING TO HIRE SOME ACCOUNTS OR ACCOUNTANTS.

OKAY. ACCOUNTANTS. OH, YES, YES, YES.

DIFFICULT TO HIRE. YEAH.

YEAH, THAT'S A GOOD POINT.

YEAH. THE ARE RETIRING, RIGHT? THAT'S A GOOD POINT, BECAUSE EVERYTHING WE'RE TALKING ABOUT ENDS FISCAL YEAR 2022, RIGHT? SEPTEMBER 9TH OF 2022.

SO WE'RE TALKING ABOUT OCCURRENCES THAT HAPPENED FROM 921 TO 922, WHICH JUST AS EVERYONE KNOWS, WE HAVE A COMPLETELY DIFFERENT FINANCE DIRECTOR NOW.

BACK THEN IT WAS COMPLETELY DIFFERENT ADMINISTRATION.

AND SO FOR NEW STAFF COMING IN, IT WAS FROM WHAT I GATHER, WAS PRETTY DIFFICULT TO MAKE SENSE OF OTHER PEOPLE'S WORK FROM BACK THEN.

AND SO THAT'S AN ONGOING CHALLENGE.

I KNOW THE CITY HAS HIRED, BUT THEN THEY DON'T STICK AROUND.

I MEAN, EVERYBODY'S COMPETING AND LIKE YOU SAID, WE HAD WE HAD AN INTERIM FOR A LITTLE WHILE, TOOK US A WHILE TO FIND SOMEONE TO HIRE.

AND THEN IN THE END, WE ENDED UP HIRING SOMEBODY THAT WAS HERE BEFORE WHO HOPEFULLY COME IN AND MAKE SENSE OF A LOT OF THINGS THAT IN FINANCE THE FINANCE DIRECTOR WAS WAS HERE IN THE PAST. AND SO IF THERE'S ONE THING OUR CLIENTS HAVE APPRECIATED, YOU KNOW, NOBODY THINKS ABOUT THE ACCOUNTANTS.

WE TEND TO BE LOW LOW ON EVERYBODY'S RADAR UNTIL YOU DON'T HAVE ONE.

RIGHT? RIGHT. THEN BECOMES AN ISSUE.

RIGHT. KIND OF HOPEFULLY KIND OF WHAT THEY SAY ABOUT LAWYERS.

YEAH. HOPEFULLY THEY DON'T LIKE THEM UNTIL YOU NEED ONE.

HOPEFULLY THIS NEXT AUDIT WOULD BE A LOT EASIER FOR YOU.

I HOPE SO. SO AND I WILL SAY IT WAS A DIFFERENT AUDITOR.

A DIFFERENT FINANCIAL ADVISOR.

YEAH. COMPLETE OVERHAUL OF CITY ADMIN AND FINANCE DEPARTMENT ADMIN, AS WELL AS THE CONSULTANTS OR OUTSIDE AUDITORS THAT THAT ARE NOW NEW SINCE LAST YEAR.

NOT NOT DURING THIS TIME.

NOW THERE'S ONE COMMENT LEFT.

JUST TURN THE PAGE JUST IN CASE.

[01:00:01]

I DON'T KNOW IF YOU ALL HAD A QUESTION ON THAT OR WHAT THAT REFERS TO.

AND I CAN SUMMARIZE BY JUST SAYING YOUR DEBT OR CERTAIN DEBT HAS CERTAIN COVENANTS THAT REQUIRES YOU TO MAINTAIN CERTAIN BALANCES AND SINKING FUNDS AND THINGS OF THAT NATURE.

AND IT'S IMPORTANT TO MONITOR.

I MEAN, YOU DON'T WANT TO BE NON-COMPLIANT OF A DEBT COVENANT.

AND IN FACT, IF YOU LOOK AT GET YOUR JUMP TO PAGE 24.

BECAUSE THIS IS REALLY WHAT WHAT IT PERTAINS TO.

JUMP OVER TO PAGE 24.

YOU SEE A YOU SEE A FOOTNOTE THAT SAYS SINKING FUNDS, A SINKING FUND IS REQUIRED BY YOUR DEBT COVENANT.

AND YOU'LL NOTICE A NEGATIVE NUMBER.

REMEMBER, WE DON'T LIKE NEGATIVE NUMBERS.

YOU SEE, YOU WERE SHORT.

OH, THE 12,015.

YEAH. IT WASN'T MATERIAL ENOUGH FOR US TO, BUT IT'S IMPORTANT ENOUGH.

YOU DO NOT WANT TO BE POLISHING YOUR DEAD COFFINS.

RIGHT. AND SO.

AND THAT'S JUST THE COMPUTATION AND MONITORING.

SO. ON THOSE WHERE THEIR BOND RESERVES AND THIS IS MAYBE A QUESTION FOR OUR STAFF, BUT HOW DO YOU HOW DO YOU FIX THAT? CAN YOU JUST TRANSFER FUNDS, PUT MONEY IN? OKAY. AND YOU GOT. YEAH, OKAY.

YOU GOT TO MAKE UP FOR THAT DEFICIENCY.

WE HAVE DONE THAT THIS LAST MONTH.

LAST WEEK. OKAY.

SO AT THIS POINT, WE SHOULDN'T SEE ANY THERE SHOULDN'T BE ANY DEFICIENCY OR ANY SINKING FUND.

YEAH. I MEAN, OUR MEASUREMENT DATE IS ONLY AT ONE POINT OF TIME.

YEAH, BUT STAFF SHOULD BE DOING IT NO LESS THAN MONTHLY.

WHICH IN TODAY'S ENVIRONMENT YOU CAN MAKE SOME MONEY RIGHT NOW.

MR. LONGORIA. JUST FOR THE RECORD, WHEN WHEN WERE YOU HIRED AS A NEW AUDITOR? YES. OUR ENGAGEMENT LETTER ACTUALLY REFERRED TO IN THAT FIRST LETTER I MENTIONED TO YOU, WE WERE HIRED ON SEPTEMBER 9TH, 2022.

THAT'S A DATE OF OUR ENGAGEMENT LETTER.

WE HAD A FIRST MEETING WITH MANAGEMENT IN NOVEMBER.

IT'S NOT ABOUT RIGHT. WE'VE BEEN AT IT EVER SINCE.

IT'S BEEN. IT'S BEEN A LONG HAUL.

OKAY. THANK YOU FOR COMING ON.

THANK YOU FOR.

AND THANK YOU FOR EXPLAINING IT.

I HOPE THAT MADE SENSE.

THANK YOU. THANK YOU. THANK YOU.

OH, AND YOU MAY HAVE EXPLAINED THIS.

LET ME SEE IF I HAD. OH, YOU DID.

YOU DID. I'M SORRY. ON THE EXPENDITURES EXCEEDING APPROPRIATION.

THAT WAS THE ONE WHERE I HAD HAD QUESTIONS.

BUT YEAH, YOU EXPLAIN THAT.

WELL, THANK YOU ALL FOR YOUR TIME. AND WE ARE HERE TO SERVE.

OKAY. VERY GOOD.

SO THANK YOU. THANK YOU, SIR.

THANK YOU FOR ALL YOUR WORK. THANK YOU.

OKAY. SO I THINK WE NEED TO MAKE A MOTION TO ACCEPT THE THE 2022 AUDIT.

CAN I GET A MOTION BEFORE WE DO THAT? RONDELL YOUR RECOMMENDATION IS TO ACCEPT THIS AUDIT.

MY RECOMMENDATION IS TO ACCEPT THE AUDIT.

YES, THIS IS SOMETHING THAT.

AS PART OF THE PROCESS.

THERE WAS A LOT OF TURNOVER, AS THEY SAID.

WHEN I CAME IN AND WAS ASKING QUESTIONS, THERE WAS HARD TO GET ANSWERS.

TO THIS DAY IT'S STILL A LITTLE DIFFICULT, BUT WE'RE WORKING THROUGH IT AND I SEE THAT THERE IS A DIFFERENCE NOW, AS DAN WAS ALLUDING TO, IN TERMS OF THE PERSONNEL, AND IT SEEMS LIKE THEY'RE STARTING TO STAFF UP AT THE FINANCE DEPARTMENT AND THAT'S GOING TO MAKE A DIFFERENCE.

I'M STAFFING UP ALSO, AND THAT MAKES A DIFFERENCE FOR ME TO LOOK AT THIS EVEN CLOSER.

BUT YEAH, WE'LL SEE A BIG IMPROVEMENT ONE YEAR OVER THE NEXT.

YEAH. AND THE ONLY REASON I ASK THAT IS BECAUSE, YOU KNOW, US AS BOARD MEMBERS, WE LOOK OVER.

BUT OF COURSE WE'RE NOT. PROFESSIONALS IN ALL THIS.

SO EVERY TIME THAT THAT I'M GOING TO VOTE ON SOMETHING, I ALWAYS ASK EVERYONE THAT PREPARED FROM THE FINANCE TO THE AUDITOR TO THE DIRECTOR. AND WHEN THEY'RE ALL IN AGREEMENT, WELL, YOU KNOW, HOW CAN WE KNOW MORE THAN THEM, RIGHT? EACH EACH PERSON. SO THAT'S WHY I JUST WANTED WANTED YOUR RECOMMENDATION FOR THE RECORD.

AND I WOULD ADD ALSO FROM A FROM A BOARD PERSPECTIVE PERSONALLY, SOMETHING LIKE ACCOUNTING AND LEGAL MATTERS SHOULD NEVER BE A SURPRISE TO THE BOARD.

THIS WAS A SURPRISE FOR ME TODAY.

AND IN THE FUTURE I WOULD LIKE NO SURPRISES.

UNDERSTOOD. SO WE'VE GOT A RECOMMENDATION TO ACCEPT THE AUDIT.

CAN WE GET A MOTION TO ACCEPT THE AUDIT? 22, 2022 AUDIT.

I'LL MAKE A MOTION. SECOND, WE GOT THE MOTION.

[01:05:02]

AND A SECOND. ALL IN FAVOR.

[D. ConsiderapprovalofrequestfromtheMuseumofSouthTexasHistorytosponsorFandango2023.]

SAY AYE. RAISE YOUR RIGHT HAND.

THANK YOU. MOTION PASSES.

OKAY. I WAS THINKING WE'LL GO INTO LET'S DO D AND E, AND IF EVERYBODY'S OKAY WITH IT, WE CAN GO INTO EXECUTIVE BECAUSE I THINK F AND H ALSO KIND OF FALL INTO THAT EXECUTIVE AND THEN WE CAN COME BACK AND AND ACTUALLY VOTE ON ANY OF THOSE THAT WE NEED TO.

ARE Y'ALL OKAY WITH THAT? DO WE NEED A MOTION FOR THAT, OMAR? YES. ON THE ITEMS THAT YOU DO WANT TO TAKE INTO EXECUTIVE, YOU WOULD NEED TO MAKE A MOTION ON THOSE JUST TO MAKE THAT CLEAR.

OKAY. OKAY. SO F IS THE PERSONNEL COMPENSATION PLAN.

G IS THE SERVICES AGREEMENT BETWEEN THE CITY OF EDINBURG AND THE EDC? DO YOU HAVE A FRONT PAGE OR A COVER PAGE? I DON'T THINK THEY HAVE THAT. IT'S ON THE AGENDA.

I'M SORRY. YEAH, GO BACK TO THE AGENDA.

NOT ALL. WE DIDN'T HAVE THE AGENDA.

YEAH, WE'RE MISSING. YEAH, I GUESS I PRINTED IT OUT FROM ONLINE.

YOU HAVE THAT. IS THAT NOT PART OF YOUR.

YEAH. NO, WE DON'T HAVE. I'M LOOKING AT MY FOLDER THAT I PRINTED OFF FOR THE ITEMS OF AGENDA ITEMS. OKAY. AND YOU CAN PULL IT UP ON YOUR PHONE.

THIS IS GOING. THANK YOU, CARLOS.

YEAH. SORRY ABOUT THAT, GUYS.

I DIDN'T KNOW THAT IT DIDN'T INCLUDE IT.

I WAS PRINTING. I PRINTED IT OUT.

ONE. YEAH. SO WHAT WERE YOU SAYING? OKAY, SO IF YOU LOOK AT.

I WAS THINKING WE DO DNA HERE.

WE DISCUSS IN EXECUTIVE F AND H, AND THEN WE COME BACK INTO OPEN SESSION.

AND IF WE NEED TO VOTE ON ANY OF THOSE, WE DO THAT BACK WHEN WE GET BACK FROM OPEN SESSION.

I'LL MAKE A MOTION TO MOVE TO EXECUTIVE SESSION.

SECOND. ALL IN FAVOR SAY AYE.

OKAY, THAT PASSES. WE'LL DISCUSS THOSE AND THEN COME BACK TO THEM IN OPEN SESSION AFTER EXECUTIVE.

OKAY. SO ITEM D IS THE APPROVAL OF THE REQUEST.

CONSIDER APPROVAL OF A REQUEST FROM THE MUSEUM OF SOUTH TEXAS HISTORY TO SPONSOR FANDANGO 2023 AND.

I THINK THEY'RE THE THE REQUEST WAS ANYWHERE FROM 1600 TO 2600.

THOSE WERE THE SPONSORSHIP LEVELS.

INCLUDED IN YOUR PACKET WAS THE REQUEST FORM WITH THE INFORMATION.

FANDANGO, I THINK, HAS BEEN A PRETTY BIG EVENT THAT THE MUSEUM HAS EVERY YEAR.

AND IF YOU LOOK ALSO IN THERE AT THE VERY END, IT TALKS ABOUT FUNDING HISTORY AND WHAT THEY'VE BEEN RECEIVING FROM EITHER.

ORGANIZATION RECEIVED OTHER FUNDING FROM THE EDC AND OR THE CITY OF EDINBURGH.

AND THEN IT LISTS PER YEAR.

BUT COULD YOU EXPLAIN THAT RIDDLE? I WASN'T SURE WHAT THE $255,000 WAS.

IS THAT FROM THE CITY? THE 255.

THOUSAND. THAT THEY GOT FROM US.

THAT'S FROM THE CITY. I GUESS THAT THEY FUND THE MUSEUM.

AND THEN BEHIND THAT IS THE ACTUAL EVENT.

IT'S OCTOBER THE 7TH.

SUPPLIER AND IT TELLS YOU WHAT YOU GET FOR THE TWO DIFFERENT SPONSORSHIP LEVELS THAT ARE BEING PROPOSED.

THIS ISN'T VERY DIFFERENT FROM OTHER EVENTS WHERE WE'RE SPONSORING A TABLE.

THE DIFFERENCE IS THAT OUR SPONSORSHIP POLICY HAS LEVELS THAT EXCEED MY AUTHORITY SIX $1,600 VERSUS $1,000. THAT'S THE DIFFERENCE.

IT'S A $600 DIFFERENCE TYPICALLY.

AND I'M GOING TO SUGGEST FOR THE NEXT ANNUAL MEETING THAT WE CHANGE THE SPONSORSHIP LEVELS, THE POLICY.

THIS WOULD BE SOMETHING THAT THAT IS VERY MINOR AND THUS I'M RECOMMENDING A $1,300 SPONSORSHIP.

IT'S A GOOD COMMUNITY EVENT.

IT'S A GOOD WAY FOR THE EDC TO BE OUT THERE AND BE VISIBLE AND ALSO GET THEMSELVES OUT IN FRONT OF POTENTIAL PROSPECTS AND GET OUR NAME OUT.

IT'S A IT'S A RELATIVELY MINOR EXPENSE COMPARED TO A LOT OF THE OTHER THINGS THAT WE'RE DOING.

SO YOU THINK THE RETURN ON THE INVESTMENT WOULD BE SUFFICIENT TO SPONSOR IT? THE LEVEL OF 1600? YEAH, FOR $1,600, THE ADVERTISING ITSELF IS WORTH MORE THAN THAT.

OKAY. WHAT PROSPECTS WERE YOU TALKING ABOUT? PROSPECTS WOULD ATTEND THIS.

I'M SORRY. I CAN'T HEAR YOU. YOU SAID IT.

[01:10:01]

YOU SAID IT WOULD. WE CAN GET IN FRONT OF PROSPECTS.

WHAT PROSPECTS? WELL, YOU NEVER KNOW WHO'S THERE.

WELL, IT IS AN EVENT THAT DRAWS A LOT OF THE BUSINESS PEOPLE OF OF THE CITY DEVELOPERS AND OTHERS TO THE MUSEUM.

ARE YOU? I THINK WE'LL GET YOU OKAY WITH 1600.

OKAY. CAN WE GET A CAN I GET A MOTION TO SPONSOR AT THE RECOMMENDED LEVEL OF 1600? I'LL MAKE A MOTION TO EDDIE.

EDDIE MAKES A MOTION.

CAN I GET A SECOND? SECOND AND ROLL IN SECOND? ALL IN FAVOR. SAY AYE. RAISE YOUR RIGHT HAND.

[E. Presentationofyear-to-dateFinancialReportendingonJuly31,2023.]

1600. ALL RIGHT.

NOW THAT WE ALL HAVE AN AGENDA.

THE OTHER ITEM IS ON THE PRESENTATION OF YEAR TO DATE FINANCIAL REPORT ENDING ON JULY 31ST, 2023.

OKAY. FINANCIAL REPORT IN YOUR PACKET IS REALLY WHAT I HAVE TO DEAL WITH ON A FAIRLY REGULAR BASIS.

ACTUALLY, SINCE I'VE BEEN HERE, THE FIRST FIVE LINE ITEMS ARE ACTUALLY REVENUE ITEMS. IF YOU LOOK AT THE FIRST ONE, THE GENERAL SALES AND USE TAX FOR THE MONTH TO DATE ACTIVITY, WHICH IS JULY, IT SAYS ZERO.

THAT'S NOT TRUE.

THERE WAS APPROXIMATELY $700,000 WORTH OF GENERAL SALES TAX THAT CAME TO US.

IT'S NOT REFLECTED IN THIS REPORT.

I DON'T EVEN WANT TO PRESENT THIS REPORT, BUT IT WAS GIVEN TO ME.

THIS IS THE STUFF THAT I HAVE TO DEAL WITH.

I GET MORE INFORMATION SOMETIMES ONLINE FROM THE GENERAL FROM THE COMPTROLLER'S OFFICE THAN I DO FROM MY OWN FINANCE DEPARTMENT.

SO IT'S DIFFICULT TO TO PRESENT SOMETHING TO YOU ALL THAT'S NOT READY.

BUT THIS WAS GIVEN TO ME ON FRIDAY WHEN WE'RE PUTTING THE PACKET TOGETHER AT THE VERY LAST MINUTE, AND THAT MAKES IT THAT MUCH MORE DIFFICULT TO ACTUALLY PRESENT SOMETHING TO YOU ALL. SO FOR MY PURPOSES, I'D LIKE TO JUST PASS ON THIS ONE AND I WILL PUT IT IN A FORMAT THAT IS ACCEPTABLE TO YOU ALL AND PRESENT IT NEXT MONTH.

YEAH, I THINK I THINK THAT'S THE WAY WE NEED TO GO BECAUSE PRETTY HARD TO PROVE SOMETHING OR SOMETHING THAT WE CAN'T RELY ON.

YEAH, IT'S NOT ACCURATE. IT'S INACCURATE AND IT'S HARD FOR ME TO TO REVIEW IT UNTIL I PUT IT IN A FORMAT THAT THAT'S UNDERSTANDABLE TO ME AS WELL.

A MOTION TO PASS ON THE TABLE.

MOTION TO TABLE. SECOND.

SECOND. OKAY.

SO ALL IN FAVOR SAY AYE.

OKAY, THAT ITEM IS TABLED.

OKAY. SO CAN WE GET A MOTION TO GO INTO EXECUTIVE SESSION TO CONSIDER THE REMAINING ITEMS ON THE AGENDA? SECOND, ALL IN FAVOR SAY AYE.

ALL RIGHT. AT 640 AND WE ARE ENTERING INTO EXECUTIVE SESSION.

THINK. I HAVEN'T HAD TO USE IT YET, BUT I DON'T.

GREAT.

[01:17:22]

I'D LIKE TO CALL THE MEETING TO ORDER OF THE EDINBURG ECONOMIC DEVELOPMENT CORPORATION.

LET'S START WITH CALLING ROLE.

AARON DEVITO. THEN THERE'S.

ROLAND GOMEZ PRESENT.

WE HAVE QUORUM. THANK YOU SO MUCH.

RAUL RESENDEZ.

EDDIE GARCIA PRESIDENT.

WOULD YOU PLEASE JOIN ME IN PLEDGE OF ALLEGIANCE? PLEDGE ALLEGIANCE TO THE FLAG FOR THE UNITED STATES OF AMERICA AND TO THE REPUBLIC FOR WHICH IT STANDS ONE NATION UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FOR ALL.

I KNOW THIS HAS BEEN POSTED THE REQUIRED PERIOD OF TIME.

OMAR? YES. UNDER STATE LAW, A CONFLICT OF INTEREST EXISTS IF A BOARD MEMBER OR CERTAIN MEMBERS OF THAT PERSON'S FAMILY HAS A QUALIFYING FINANCIAL INTEREST IN AN AGENDA ITEM, IF THERE IS A CONFLICT OF INTEREST, THE BOARD MEMBER CAN'T PARTICIPATE OR VOTE ON THE ITEM.

ARE THERE ANY CONFLICTS TO DISCLOSE? NO. NO. THANK YOU.

CARLOS, DO WE HAVE ANYBODY THAT SIGNED UP FOR PUBLIC COMMENT? OKAY. THANK YOU. DIRECTORS REPORT.

I'LL BE BRIEF ON MY DIRECTOR'S REPORT BECAUSE WE HAVE A LENGTHY AGENDA.

BUT WHAT'S INTERESTING TO NOTE IS THAT WE HAVE 1406 ADDITIONAL PEOPLE IN THE LABOR FORCE.

SO THAT MEANS THAT OVER THAT LAST YEAR WE'VE CREATED SOME MORE JOBS.

AND SO EVEN THOUGH UNEMPLOYMENT RATE SEEMS TO STAY STEADY, THERE'S MORE GROWTH COMING IN.

SO I DID WANT TO NOTE THAT AS FAR AS THE LABOR STUDY GOES, IN ADDITION TO THAT, IN YOUR PACKET, YOU HAVE SOME UPDATES FROM THE ALLIANCE FOR I-69, TEXAS, THE SOCIAL MEDIA MONTHLY REPORT, SOME NEW FOLLOWERS AND ALSO OF NOTE IN OUR COMMERCIAL PERMITTING AND RESIDENTIAL PERMIT CONSTRUCTION VALUES OVER LAST YEAR, WE HAVE EXCEEDED LAST YEAR'S YEAR TO DATE NUMBERS

[01:20:04]

BY CLOSE TO $70 MILLION.

SO WE'RE AT $278 MILLION TO DATE IN TOTAL CONSTRUCTION SO FAR.

AND THAT IS REALLY EVEN SURPASSING LAST YEAR'S END OF YEAR TOTALS.

SO VERY GOOD PERFORMANCE THUS FAR IN TERMS OF COMMERCIAL AND RESIDENTIAL GROWTH.

THERE'S NEW CONSTRUCTION IN TERMS OF SUBDIVISIONS AS WELL.

THERE'S 63 UNDER CONSTRUCTION RIGHT NOW WITH OVER 4800 LOTS UNDER DEVELOPMENT.

AND THEN IN REVIEW, WE HAVE 34 NEW SUBDIVISIONS WITH THAT TOTALS ABOUT 1300 NEW LOTS AND 67IN PRELIMINARY REVIEW, WHICH IS ANOTHER ALMOST 1600 LOTS.

SO VERY, VERY GOOD RESIDENTIAL GROWTH RATES GOING ON RIGHT NOW.

SOME OF THE UPCOMING CONFERENCES THAT WE WANT TO LET YOU ALL KNOW ABOUT IS TEAM TEXAS ECONOMIC SUMMIT IS TOMORROW THROUGH WEDNESDAY IN ODESSA.

I WILL BE FLYING OUT AT 630 IN THE MORNING TOMORROW MORNING.

CARLOS WILL BE IN AUSTIN FOR THAT ONE.

AND THEN CAFE CON USA AND CANADA IN CANADA IN MONTERREY ON SEPTEMBER 5TH, CARLOS WILL BE ATTENDING THAT CONFERENCE AND ACTUALLY REPRESENTING US IN THE IN HIS BOOTH.

AND OF COURSE, ON SEPTEMBER 8TH, WE HAVE THE TDC SALES TAX WORKSHOP.

TEXAS ECONOMIC DEVELOPMENT COUNCIL HAS NOT HAD ONE OF THESE WORKSHOPS IN THE RIO GRANDE VALLEY IN A LONG TIME, IF EVER.

SO THIS IS AN OPPORTUNITY FOR LOCAL ELECTED OFFICIALS, BOARD MEMBERS AND STAFF TO LEARN A LITTLE BIT MORE ABOUT SOME OF THE NEW LEGISLATIVE REQUIREMENTS AND LEGISLATIVE CHANGES TO THE SALES TAX.

SOME OF THE UPCOMING EVENTS, ASIDE FROM OUR CITY COUNCIL WHERE WE WILL BE PRESENTING, HOPEFULLY THE PROGRAM WILL WORK IN THE BUDGET.

WE HAVE A RIBBON CUTTING COMING UP ON SEPTEMBER 15TH, THEN A JOB FAIR ON SEPTEMBER 14TH AS WELL IN COORDINATION WITH WORKFORCE SOLUTIONS.

AND OF COURSE, THE SOUTH TEXAS INTERNATIONAL FILM FESTIVAL IS BETWEEN THE SEPTEMBER 14TH AND 16TH.

IN OCTOBER. OUR TDC ANNUAL CONFERENCE WILL BE IN HOUSTON.

THOSE OF YOU WHO ARE INTERESTED IN ATTENDING AND LEARNING A LITTLE BIT MORE ABOUT ECONOMIC DEVELOPMENT AND SOME OF THE UPDATES THAT ARE GOING ON, THIS WOULD BE A GOOD CONFERENCE TO ATTEND AS WELL.

AND THEN FINALLY, I JUST WANT TO SAY THAT THE ECONOMIC RIO GRANDE VALLEY PARTNERSHIP ECONOMIC SUMMIT THAT WAS HELD LAST WEEK WAS A VERY BIG SUCCESS.

A LOT OF PUBLICITY, A LOT OF PEOPLE THAT SHOWED UP IN EDINBURG TO HELP US TALK ABOUT REGIONALISM AND UNITY IN TERMS OF ECONOMIC DEVELOPMENT. YEAH, IT WAS A REALLY GOOD EVENT.

THINKING AS A REGION RATHER THAN INDIVIDUAL CITIES.

SET IT FOR THE REPORT.

ANY QUESTIONS OF RODEL? ALL RIGHTY. I KNOW WE'RE GOING TO HAVE QUITE A LONG MEETING TODAY, SO LET'S GET TO APPROVAL OF THE MINUTES.

MADAM PRESIDENT. OH, HI.

WE HAVE COUNCILMAN AND BOARD MEMBER HERE, MR. DAN DIAZ. THANK YOU FOR JOINING US.

CAN WE GET A MOTION TO APPROVE THE MINUTES FOR JULY 12TH AND JULY 25TH? I MAKE A MOTION. I GET A SECOND? SECOND. SECOND.

ALL IN FAVOR. SAY AYE OR RAISE YOUR RIGHT HAND.

OKAY. WE HAVE A VALLEY INITIATIVE, VIDA PRESENTATION.

AND I THINK WE HAVE ALIDA HERE.

IS IT ON? IT'S KIND OF HARD.

TEST. THERE YOU GO. THANK YOU.

SO MY NAME IS PAULINA VILLARREAL AND I CURRENTLY SERVE AS CEO OF VALLEY INITIATIVE FOR DEVELOPMENT AND ADVANCEMENT.

AND SO WE'RE VERY THANKFUL FOR THE EDC FOR YOUR SUPPORT THIS YEAR AND A GRANT OF THE 50,000 IN WHICH OUR BENCHMARK WAS TO SERVE

[01:25:03]

15 RESIDENTS FROM EDINBURG IN YOUR PACKET IS A ONE PAGER PROJECT UPDATE IN WHICH WE ARE SHOWING THAT WE ACTUALLY EXCEEDED THE BENCHMARK AND SERVED 28 EDINBURG RESIDENTS.

AND OUT OF THOSE 28, WE HAVE MAINTAINED A PERSISTENCE RATE OF 100%, WHICH MEANS ALL OF THE STUDENTS HAVE EITHER GRADUATED OR PERSISTED INTO THEIR SECOND YEAR OF EDUCATION. AND SO I'M HERE TODAY REQUESTING YOUR CONSIDERATION FOR AN INVESTMENT FOR NEXT FISCAL YEAR AND THE AMOUNT OF 100,000IN WHICH VIDA WOULD BE MATCHING A $50,000 INVESTMENT FOR A TOTAL PROJECT OF $150,000 TO DOUBLE OUR OUTREACH AND OUR IMPACT TO SERVE AT A MINIMUM 30 EDINBURG RESIDENTS.

AND I'M HAPPY TO ANSWER ANY QUESTIONS OR CONCERNS YOU MAY HAVE.

SO, MEMBERS, I KNOW WE WE HAD ALL HEARD FROM THAT BEFORE ABOUT THE WRAPAROUND SERVICES THAT VIDA PROVIDES.

WE WANTED TO MAKE SURE THAT IT WAS GOING TOWARDS EDINBURG RESIDENTS, WHICH IT WAS, AND THEY EXCEEDED IT.

I KNOW THAT SOME OF THE WORK THAT THEY'RE DOING IS THE KIND OF WORK THAT REALLY KEEPS KIDS IN SCHOOL, BUT ASIDE FROM THAT, REALLY PLACES THEM THEN INTO HIGH PAYING JOBS, WHICH IS CRITICAL.

WE WANT TO GET THEM OUT AND GET THEM IN THE WORKFORCE.

SO I'M GLAD TO SEE THAT THE NUMBERS HAVE INCREASED THE WAY OR AT LEAST THAT YOU DID BEYOND WHAT Y'ALL HAD PROMISED INITIALLY.

SO I THINK THERE'S A MATCH ALSO THAT Y'ALL WOULD PROVIDE.

IF WE DO 100,000, YOU'LL MATCH IT WITH 50,000, IS THAT RIGHT? CORRECT. DOES ANYBODY HAVE ANY QUESTIONS FOR MISS ARIEL? THOSE STUDENTS AND WHERE THEY'RE AT IN TERMS OF WHAT SCHOOL? WHAT THEY'RE DOING? YES, ABSOLUTELY.

AS A MATTER OF FACT, WE DO SEND A QUARTERLY REPORT TO THE EDC, BUT WE CAN ALSO SHARE THAT WITH YOU ALL IF YOU PREFER TO RECEIVE IT AS WELL.

HOW SOON CAN WE. BY TOMORROW.

YEAH, I KNOW. IT'S IN THE ONE PAGER.

IT SHOWS THE AREAS THAT THEY'RE STUDYING IN OR THAT.

SO THE STEM FIELDS, THE SPECIALIZED TRADES, SOCIAL SERVICES AND BUSINESS WITH THE LARGEST BEING THE SPECIALIZED TRADES.

SO I PROBABLY THAT PROBABLY MEANS THAT MOST OF THEM ARE EITHER GOING TO STC OR STC AND WELL, ACTUALLY WOULD BE STC IF IT'S LOCAL, RIGHT? YES. BUT YEAH, THAT WOULD HELP TO HAVE THAT.

SO WITH A HIGHER CONTRIBUTION, WE HAD CONTRIBUTED 50,000 ALREADY AND GREAT JOB, BY THE WAY, ON, ON HELPING, YOU KNOW, EXCEEDING WHAT YOU HAD PROMISED WITH BY DOUBLING THE CONTRIBUTION.

IS THERE A CHANCE THAT THESE NUMBERS FROM COULD INCREASE 30 TO MAYBE A DIFFERENT NUMBER? YES, ABSOLUTELY.

SO I CAN PRETTY MUCH GUARANTEE YOU THAT IF THE BENCHMARK IS 30, THAT WE WOULD OVER EXCEED THAT BENCHMARK AS WELL FOR NEXT YEAR BECAUSE WE'RE ABLE TO BRAID YOUR INVESTMENT WITH OTHER FUNDING SOURCES.

AND JUST RECENTLY, WE WERE AWARDED A $3 MILLION NURSING GRANT FROM THE DEPARTMENT OF LABOR.

SO A LARGE PORTION OF THAT CAN BE LEVERAGED WITH YOUR INVESTMENT TO AGAIN EXCEED THE BENCHMARK AND SERVE MORE RESIDENTS.

SO. AND YOU'VE GOT A I NOTICED YOU ALL HAVE A DATABASE CALLED SOCIAL SOLUTIONS APRICOT.

SO IT COULD HAVE ANY INFORMATION FROM ELIGIBILITY TO THE RESOURCES THAT THEY RECEIVE TO THE EMPLOYER WHERE THEY'RE WORKING AT, AS WELL AS THEIR ANNUAL SALARY OR WAGES AND THE GROWTH OF THOSE WAGES OVER THE THREE YEARS.

YEAH, I REALLY LIKE THAT THAT TRACKING SYSTEM BECAUSE I THINK A LOT OF TIMES PEOPLE PLACE THEM AND THEN THEN THEY GET LOST AND THEN YOU DON'T KNOW WHAT HAPPENS TO THE PERSON.

ANY OTHER QUESTIONS? DO YOU ALL WANT TO WAIT FOR US TO GET THE DOCUMENT AND VOTE ON IT FOR THE NEXT MEETING? OKAY. THANK YOU SO MUCH, MISS.

SO WE HAVE CONSIDER ACCEPTING THE EDINBURG EDC 2022 AUDIT.

AND WE HAVE JOINING US FROM BURTON MCCUMBER AND LONGORIA RICKY LONGORIA.

AND TELL ME YOUR NAME AGAIN.

LUIS GOMEZ LOPEZ.

WE HAVE LUIS LOPEZ. THANK YOU.

THANK YOU, MADAM CHAIRMAN.

AGAIN, MY NAME IS RICKY LONGORIA.

I'M MANAGING PARTNER OF THE FIRM OF BURTON, MCCUMBER AND LONGORIA.

PRIVILEGED TO ACTUALLY BE ABLE TO SERVE YOU ALL AND SERVING NOT ONLY YOU ALL, BUT THE CITY OF EDINBURG.

[01:30:05]

THIS IS MR. LUIS LOPEZ. HE IS AN AUDIT MANAGER WITHIN THE FIRM.

HE WAS THE ONE PROBABLY MORE HANDS ON THAN MYSELF IN TRYING TO GET THIS AUDIT TAKEN CARE OF AND AND AND COMPLETED.

UM, I HAVE THE OPPORTUNITY TO TO TO SPEAK TO MADAM CHAIRMAN BEFORE THE MEETING SAID, YOU KNOW, RELATIVELY SPEAKING, THIS REPORT SHOULD BE FAIRLY EASY.

THE CHALLENGE I'M HAVING IN TRYING TO PRESENT YOU ALL THIS REPORT IS REALLY JUST A NUMBER OF ERRORS THAT WE FOUND IN LAST YEAR'S REPORT THAT HAVE CARRIED INTO THIS YEAR'S REPORT.

AND SO I'M GOING TO TRY NOT TO SPEAK LIKE AN ACCOUNTANT, BUT I'VE BEEN DOING THIS FOR 30 YEARS.

THERE'S GOING TO BE VERY HARD FOR ME TO DO SO.

SO I'M GOING TO DO THE BEST I CAN TO TRY TO SUMMARIZE IN PLAIN ENGLISH, IF YOU WILL, THE EFFECT THAT THOSE ERRORS HAD IN US FINANCIAL STATEMENTS AND CERTAINLY THE SILVER LININGS, BECAUSE I DON'T WANT TO IMPLY THAT EVERYTHING'S BAD BECAUSE THERE ARE SOME SILVER LININGS IN THIS THAT THAT ARE VERY IMPORTANT TO MENTION.

THANK YOU. AND I HAD MENTIONED TO RICKY THAT WE MAY AT SOME POINT SAY, CAN YOU DUMB IT DOWN A LITTLE BIT FOR US AND LET'S NOT TALK ACCOUNTING PRINCIPLES.

AND YEAH, I PROMISE I WOULD NOT BE OFFENDED.

SO WHAT WAS EMAILED TO YOU AND I'M ASSUMING YOU ALL HAVE AN EMAIL COPY WAS BASICALLY TWO DOCUMENTS.

ONE IS THE ACTUAL REPORT ITSELF AND ONE IS A SMALLER THREE PAGE VERSION OF A DOCUMENT THAT JUST AS A MATTER OF PRACTICE, I'VE GOT TO KIND OF HAVE TO GO THROUGH THERE. BUT THERE ARE GOING TO BE A HANDFUL OF GOOD POINTS IN THERE THAT I HOPE GET YOU TO START THINKING ABOUT.

HEY, WHAT HOW IS THIS GOING TO AFFECT THE ACTUAL AUDIT REPORT AND THE NUMBERS BEING PRESENTED? SO I'M GOING TO START WITH THE THE SMALLER DOCUMENT, AND IT'S CALLED THE GOVERNANCE LETTER.

I'LL I'LL SPEAK TO IT, THOUGH.

UM, AGAIN, JUST JUST CONFIRMING WHY WE'RE HERE.

WE'RE HERE TO DISCUSS THE AUDIT FOR THE YEAR ENDED SEPTEMBER 30TH, 2022.

ALSO CONFIRMING THAT THAT THE AUDIT, IN TERMS OF THE ROLE THAT WE PLAY IN THIS PROCESS, IS PERFORMED UNDER GOVERNMENT AUDITING STANDARDS.

SO WE ARE HELD TO TO A HIGHER STANDARD IN THAT REGARD.

AND THEN THERE'S A SECTION CALLED SIGNIFICANT AUDIT MATTERS, AND IT SPEAKS TO MANAGEMENT'S RESPONSIBILITY.

A LOT OF FOLKS THINK THAT THE AUDIT REPORT ITSELF IS OURS.

OUR OBJECTIVE IS TO AUDIT THE REPORT, NOT TO NECESSARILY PREPARE THE REPORT.

IN FACT, THE ACTUAL REPORT ITSELF WAS ACTUALLY PREPARED BY CITY STAFF.

CERTAINLY THERE WAS A LOT OF BACK AND FORTH BECAUSE THERE ARE SOME THINGS THAT WE SAW THAT WEREN'T CORRECT.

BUT AT THE END OF THE DAY, IT'S MANAGEMENT'S RESPONSIBILITY.

UM, I WANTED TO MENTION THAT JUST.

JUST SO YOU KNOW.

YOU KNOW, OUR.

OUR PROFESSION IS EVOLVING, JUST LIKE EVERYBODY'S PROFESSION.

AND THERE'S, YOU KNOW, THERE'S ALWAYS SOMEBODY NEW YORK THAT THINKS WE'VE GOT TO MAKE IT MORE DIFFICULT THAN IT HAS TO BE.

AND SO IF IF YOU'VE EVER HAD AN AUTO PRESENTATION THIS PAST YEAR, YOU MAY HAVE NOTICED OR MAYBE THEY MENTIONED ABOUT A NEW LEASE STANDARD ACCOUNTING FOR LEASES, THAT'S A BIG THING.

AND AND NOT ONLY IN THE FOR PROFIT WORLD, BUT THE NONPROFIT WORLD AND GOVERNMENTAL.

BUT JUST TO ACKNOWLEDGE THAT THERE IS A NEW STANDARD IN THIS PARTICULAR YEAR.

THE SILVER LINING IS AN US CASE.

IT'S NOT SIGNIFICANT ENOUGH FOR US TO EVEN CONSIDER, BUT WE JUST NEED FOR YOU ALL TO BE AWARE THAT LEASES ARE THERE IS A LEASE STANDARD.

TO THE EXTENT THAT YOU GET INTO SOMETHING IN THE FUTURE THAT IS SIGNIFICANT.

ALSO, JUST ACKNOWLEDGING THAT AS MUCH AS IN EVERY AUTO REPORT AND EVERY ACCOUNTING DEBITS EQUAL CREDITS AND SO THAT SEEMS LIKE A SCIENCE THEY SHOULD ALWAYS AGREE.

THERE ARE ESTIMATES ASSOCIATED WITH SOME OF YOUR NUMBERS.

BUT THERE'S AN ESTIMATE THERE AS TO WHETHER YOU'LL BE ABLE TO COLLECT YOUR MONEY BACK ALSO TO DEPRECIATION AND THINGS OF THAT NATURE, TRYING TO FIGURE OUT THE USEFUL LIFE OF AN ASSET THAT'S SOMEBODY'S BEST GUESS.

ALSO TO JUST, JUST JUST REMEMBER THAT IF YOUR BOTTOM LINE ORIENTATED, YOU'RE PROBABLY THE TYPE OF INDIVIDUAL WHO'S GOING TO GO STRAIGHT TO THE BOTTOM LINE AND SAY, OKAY, WELL, ARE WE ARE WE GOOD OR NOT? DO WE MAKE MONEY OR DO WE NOT MAKE MONEY? AND THOSE ARE GOOD METRICS AND I'M GOING TO SPEAK ABOUT THOSE.

BUT JUST DON'T FORGET THAT THE FOOTNOTES.

IN THE BACK. THERE ARE IMPORTANT IF YOU EVER HAVE A CHANCE, YOU KNOW, WHEN YOU HAVE NOTHING TO DO BUT TO READ AN AUTO REPORT, THEY ARE IMPORTANT AS GOOD INFORMATION BACK THERE. AND SO PLEASE DON'T DON'T DON'T EVER IGNORE THEM.

OKAY. I WANT TO TURN THE PAGE AND I'M GOING TO TALK TO THE FIRST POINT THAT'S ON THERE.

[01:35:01]

AND IT SAYS DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT.

SO IT'S NOT IT'S NOT A GOOD PRACTICE TO HAVE A SEPTEMBER 30TH, 2022 AUDIT REPORT PRESENTED TO YOU IN AUGUST.

I THINK GENERALLY SPEAKING, YOU DON'T HAVE TO BE AN ACCOUNTANT, YOU KNOW, TO TO TO KNOW THAT.

AND FOR THOSE THAT ARE NOT FAMILIAR WITH AUDIT PROCESS, SOMETIMES, YOU KNOW, IT'S THE AUDITOR'S FAULT, YOU KNOW.

WELL, THEY DIDN'T GET THEY DIDN'T GET THE OPPORTUNITY TO TO THEY DIDN'T THEY DIDN'T THEY DIDN'T DO THEIR JOB.

MANAGEMENT WAS UNABLE TO PROVIDE A TRIAL BALANCE TO US UNTIL APRIL 14TH, 2023.

WHY ARE WE WHY ARE WE STILL TALKING ABOUT THIS IN AUGUST? WELL, ONCE WE GOT THE TRIAL BALANCE, WE STILL NEEDED INFORMATION TO AUDIT, RIGHT? WE ONLY AUDIT WHAT THE CITY CAN PROVIDE.

AND IT TOOK THAT LONG IN ORDER FOR US TO BE ABLE TO COMPLETE THE AUDIT.

AND SO, FOR EXAMPLE, I MENTIONED AND I JUST THIS IS AN EXAMPLE I MENTIONED THE CITY'S RESPONSIBLE FOR PREPARING THE AUDIT.

THEY THEY SENT US A DRAFT, THEIR FIRST ITERATION OF THE DRAFT ABOUT FOUR WEEKS AGO.

AND ADMITTEDLY, I THINK THEY WOULD AGREE IT WAS NOT IN GOOD SHAPE.

AND SO WE SENT THEM BACK ALMOST AN ENTIRE NEW REPORT AND JUST TOOK THEM THAT LONG TO GET US SOMETHING THAT WE COULD WORK WITH.

THAT'S A NORMAL PART OF THE PROCESS, BUT IT'S NOT NORMAL TO BE HERE DURING THIS TIME.

AND SO I JUST WANTED TO TO ACKNOWLEDGE THAT AND KNOW THAT WE AS SERVICE PROVIDERS ARE ALWAYS INTERESTED IN MAKING SURE THAT YOU GET SOMETHING TIMELY.

OKAY. DOES ANYBODY HAVE A QUESTION ABOUT THAT POINT? JUST FOR CLARITY AND FOR US ON THE BOARD.

SO LAST YEAR DURING THAT TIME THAT YOU NOTED, WE WERE PAYING THE CITY.

FOR THIS FOR AUDITING AND ACCOUNTING, IS THAT CORRECT? YES. SO SO WE WERE WE WERE PAYING THE CITY.

AND YOU FAILED TO GET THE PROPER INFORMATION THAT YOU NEEDED.

OBVIOUSLY, IF YOU'RE GETTING IT IN APRIL OR FOUR WEEKS AGO, WE'RE DELAYED SO THAT WE KNOW THAT.

AND WHAT WHAT CONVERSATIONS DO WE HAVE WITH WITH WITH CITY COUNTY STAFF OR WHAT HAVE YOU? WELL, THEY WERE ALSO CONDUCTING THE CITY AUDIT AT THE SAME TIME.

THAT'S A WHOLE DIFFERENT.

I'M MORE CONCERNED ABOUT THE EDC AUDIT BECAUSE THAT'S WHAT WE'RE PAYING FOR.

RIGHT. NOT NOT THE CITY AUDIT.

WELL, THEY WERE AWARE THAT WE WANTED THE AUDIT DONE.

WE PAID FOR. I MEAN, WE PAID OUR.

WE PAID FEES, RIGHT? YES. ALL RIGHT.

YEAH, WE HAVE PAID.

WE HAVE NOT GOTTEN A FULL ACCOUNTING OF THE BALANCE SHEETS AND PROFIT AND LOSS STATEMENTS.

WE'VE BEEN CREATING IT ON OUR OWN FROM THE SOFTWARE PROGRAMS THAT'S OUT THERE.

YOU'RE BASICALLY GETTING ALL THE RAW DATA AND THEN HAVING TO PUT TOGETHER SOMETHING.

OKAY. YES. THANK YOU.

AND THE REASON WHY I BRING IT UP, WE JUST HAD A $100,000 REQUEST FROM SOMEONE WE DON'T EVEN KNOW IF WE EVEN HAVE THAT.

AND MR. LONGORIA BY YOU'RE NOT. THAT'S CONCERNING.

YEAH. I MEAN, YOU KNOW, IT'S UNFORTUNATE THAT YOU KNOW.

I'M AN ACCOUNTANT, BUT I'M ALSO A HISTORIAN, RIGHT? BECAUSE EVERYTHING WE DEAL WITH IS IN THE PAST.

BUT YOU'VE GOT TO.

YEAH, HISTORY IS IMPORTANT TO YOU ALL.

BUT YOU'RE ALL MAKING DECISIONS TODAY, RIGHT? YOU KNOW, SPENDING $100,000 IS NOT AN INSIGNIFICANT AMOUNT.

SO I, LIKE YOU WOULD WANT TO HAVE KNOWLEDGE AS TO WHERE WE AT TODAY.

YEAH, THIS IS IMPORTANT.

AND YES, YOU HAVE TO HAVE IT DONE AND THINGS OF THAT NATURE.

BUT THE BEST INFORMATION FOR YOU ALL TO MAKE DECISIONS ON IS REALLY THE MOST CURRENT INFORMATION TODAY.

AND IF IT'S NOT BEING PRESENTED AND THAT'S SOMETHING OBVIOUSLY NEEDS TO BE ADDRESSED.

SO. SO. SO THE NEXT PART TALKS ABOUT CORRECTED AND UNCORRECTED MISSTATEMENTS.

AND HERE'S WHERE I CAN GET.

SPEAKING LIKE LIKE AN ACCOUNTANT.

SO I JUST WANT YOU JUST TO CONCEPTUALIZE THIS CONCEPT.

OKAY. AND LOOKING AT LAST YEAR'S REPORT.

OKAY. THERE WAS APPROXIMATELY 17 TO $18 MILLION WORTH OF ERRORS IN THAT REPORT IN TERMS OF THINGS THAT ARE BEING PRESENTED. OKAY.

AND THAT'S NOT A GOOD THING.

I'M GOING TO GIVE YOU THE SILVER LINING HERE IN A MINUTE.

RIGHT. BUT THAT'S NOT A GOOD THING.

OKAY. SO SO THAT SPEAKS TO THAT DETAIL.

I'M NOT GOING TO GO INTO THE COUNTY SPEAK, BUT JUST CONCEPTUALLY, BECAUSE I'M GOING TO WALK YOU THROUGH WHERE THOSE ERRORS LIE.

[01:40:02]

OKAY. UH, DISAGREEMENTS WITH MANAGEMENT.

AS CHALLENGING AS IT WAS, WE HAVE REALLY, YOU KNOW, TRYING TO TO CONDUCT THIS AUDIT.

AND, YOU KNOW, OBVIOUSLY THE CITY'S AUDIT SINCE DECEMBER OF 2022.

WE HAVE MET WEEKLY WITH STAFF TRYING TO GET THIS OUT.

AND SO CERTAINLY FROM OUR SPIRIT, I THINK THAT ACTION INTO ITSELF SPEAKS FOR ITSELF AND TRY AND PROVIDE THE LEVEL OF SERVICE WE BELIEVE YOU DESERVE.

UM, BUT AT THE END OF THE DAY IN THAT PROCESS, YOU KNOW.

THERE WAS NO INFIGHTING.

ANYONE I JUST WANT TO CONFIRM THAT.

REALLY? THAT'S ALL I REALLY WANTED TO COVER ON THIS LETTER.

THERE'S OTHER THINGS IN THIS LETTER THAT MAY CATCH YOUR EYE.

THE PHONE CALL. YEAH. SO SO WHAT WHAT WE'VE LEARNED IS THAT THE BEST KIND OF COMMUNICATION, IF IT'S NOT GOING TO BE ONE ON ONE, IT'S GOT TO BE VIA ZOOM.

OKAY. THAT'S THE WORLD WE LIVE IN.

SO EVERY FRIDAY AND THEY SET THE DAY AND TIME, NOT US EVERY FRIDAY SINCE SINCE DECEMBER, WE'VE HAD A STANDING 3 P.M.

CALL WITH CITY STAFF TO FIND OUT WHERE YOU'RE AT.

OKAY. TALK ABOUT WHAT'S THE PROGRESS WHERE WE'RE AT.

BECAUSE IF YOU CAN IMAGINE, WHEN WE WERE ENGAGED, WE I MEAN, WE HAVE HUMAN RESOURCES, BUT WE CAN'T BE ON CALL OURSELVES.

RIGHT. AND SO OUR TIME FOR THIS AUDIT WAS ACTUALLY SCHEDULED BACK IN THE SPRING BECAUSE THAT WAS WHEN WE AGREED TO DELIVER THE AUDIT.

AND BEING ABLE TO DO SO, THAT PUTS US, YOU KNOW, IN AN ON CALL POSITION.

AND SO HAVING THOSE WEEKLY MEETINGS ALSO TELLS ALLOWS US TO TO SCHEDULE STAFF.

OKAY. THEY'RE FURTHER AHEAD THAN WE THINK THEY ARE AND THINGS OF THAT NATURE.

THERE ARE ALWAYS, I WANT TO SAY FACE TO FACE, BUT IN THIS WORLD, ZOOM IS ALMOST FACE TO FACE.

OKAY. WE ALSO HAVE JUST SO YOU KNOW, WE HAVE SYSTEMS IN PLACE THAT TRACK OUR REQUEST AND THEIR SUBMISSIONS.

SO I COULD PRINT YOUR REPORT THAT SHOWS, HEY, WE WE ASKED FOR THIS BACK IN.

I'M TOTALLY MAKING UP A DATE ON JANUARY 15TH AND THE SYSTEM WILL SHOW YOU.

WE GOT IT IN JUNE 15TH.

RIGHT. SO THERE'S NO QUESTION, NO FINGER POINTING ABOUT, HEY, YOU KNOW, I GAVE IT TO YOU.

YOU LOST IT. NO.

WE HAVE SYSTEMS IN PLACE TO ENSURE THAT EVERYBODY'S ACCOUNTABLE FOR THE ENTIRE PROCESS.

CAN YOU CLARIFY IN TERMS OF.

MR. LONGORIA, YOU SAID YOU WERE MEETING WITH STAFF.

OBVIOUSLY, YOU'RE AUDITING THE EDC DEPARTMENT, CORRECT? THAT INCLUDE EDC STAFF IN THOSE? YEAH. SO SO, SO THE ACCOUNTING STAFF THAT'S ASSIGNED TO YOU ALL AT THE SAME ACCOUNTING STAFF.

TO THE CITY. SO THAT ONE MEETING INCORPORATED BOTH TOPICS.

A WELL INCORPORATED BOTH TOPICS, BUT INCLUDED STAFF FROM BOTH ENTITIES.

YEAH. SO AGAIN, THE ACCOUNTING STAFF IS THE SAME.

YEAH. RIGHT.

BUT OUR STAFF, EDC STAFF.

YEAH. WELL AGAIN, BECAUSE WE DON'T HAVE AN ACCOUNTING DEPARTMENT, SO TO SPEAK.

YEAH. YEAH. LET ME WAS THERE IN OUR.

OKAY THAT'S, THAT'S WHAT YOU'RE REFERRING TO.

CORRECT? YEAH. LET'S SEE NOW WORKS FOR THE EDC BUT DIDN'T THEN.

RIGHT. AND TO AND TO BE HONEST WITH YOU, WHEN IT COMES TO THE YOU KNOW, THE DETAILS OF THE AUDIT, I'M GOING TO CALL IT, YOU KNOW, THE NUTS AND BOLTS OF THE AUDIT THAT'S USUALLY DONE BY THE PEOPLE WHO HANDLE THE BOOKS.

RIGHT. YOU KNOW, TRYING TO FIGURE OUT I NEED RECONCILIATION, I NEED THIS.

SO THAT'S WHY IT WAS THOSE FOLKS.

I THINK CAN.

I THINK HE'S REFERRING TO FINANCE.

IF YOU'RE TALKING ABOUT FINANCE DEPARTMENT.

YES. YES.

THE REASON WHY I POSED THE QUESTION THAT THERE IS A DOCUMENT YOU NEEDED OR WHAT HAVE YOU, WOULD YOU PAY? DC STAFF WOULD, HEY, I CAN GET YOU THAT VERSUS FINANCE DEPARTMENT BECAUSE WE MAY MAYBE SPEND.

DONATED. YEAH, WE COULD HAVE HELPED YOU ALONG THAT PROCESS.

YEAH. SO? SO WHEN WE WERE ENGAGED, YOU KNOW, THERE WAS ONE CITY FINANCE DIRECTOR, THEN YOU HAD AN INTERIM CITY FINANCE DIRECTOR, AND THEN YOU HAD.

AND IN THOSE INSTRUCTIONS, WE WERE INSTRUCTED THE MOST EFFICIENT WAY WOULD BE TO GO THROUGH THEM BECAUSE THEY'RE THE ONES THEY'RE THE ONES MAINTAINING THE BOOKS AND RECORDS IF THERE'S A MORE EFFICIENT WAY.

AND IF YOU SUGGEST, HEY, NEXT YEAR, YOU KNOW, DO X, OF COURSE WE'LL CONSIDER THAT IN THE PROCESS.

YEAH, NO, AND JUST SO YOU KNOW, AND I THINK YOU DO, YOU KNOW, WE OUTSOURCE THAT TO THE CITY AND PAID A FEE AND THEN SO WE JUST I JUST DON'T KNOW IF A LOT OF TIMES IT FILTERS DOWN TO WHERE WHEN SOMETHING IS NEEDED, IT GETS DIRECTLY.

THAT MESSAGE GETS DIRECTLY TO EDC STAFF TO PULL SOMETHING.

OR IF IT'S JUST COMING FROM FINANCE DEPARTMENT OF THE CITY.

RIGHT. OKAY. THANK YOU.

BASED ON. I GUESS INSIGHT IS NOT NECESSARILY SOMETHING THAT THE ED STAFF WOULD ACTUALLY NEED TO PROVIDE BECAUSE ALL THOSE DOCUMENTS ARE MAINTAINED AT THE FINANCE DEPARTMENT.

AND SO IT WOULD BE THE FINANCE DEPARTMENT THAT WOULD NEED TO.

[01:45:01]

I THINK IT'S MORE FROM A COMMUNICATION PERSPECTIVE.

THIS IS THE FIRST TIME I HEAR THAT WE HAVE ISSUES AND THAT'S THAT'S SOMETHING THAT I WAS GOING TO GO TO AS WELL, THAT I THINK IT'S IMPORTANT THAT WE FIND OUT EARLIER WHEN WE'VE GOT A PROBLEM LIKE THIS, BECAUSE LIKE YOU SAID, EVERY DECISION THAT WE MAKE IS BASED ON HOW WE THINK FINANCIALLY.

WE'RE SITTING, YOU KNOW, AND HERE WE ARE TRYING TO MAKE THINGS HAPPEN AND AND WE MIGHT NOT EVEN HAVE THE MONEY FOR IT.

SO SO, YEAH, IT'S, IT'S IMPORTANT THAT WE FIND OUT EARLIER.

ANY OTHER QUESTIONS ON THIS PART? OKAY. MOVING ON THEN LET'S LET'S LET'S JUMP OVER TO THE FINANCIAL STATEMENTS THEMSELVES.

SO I'M GOING TO JUMP TO PAGE ONE, WHICH IS.

IS OUR LETTERHEAD. OKAY.

AND SO SO THIS IS A GOOD NEWS, RIGHT? SO SO WITHOUT READING THROUGH ALL THE PARAGRAPHS AND THINGS LIKE THAT, I WILL SUMMARIZE BY SAYING THAT THAT OUR JOB WAS TO RENDER AN OPINION ON THE FINANCIAL STATEMENTS.

AND OF COURSE THEY HAVE BEEN ADJUSTED TO TO THE TO WHERE WHERE WE FEEL COMFORTABLE RENDERING AN OPINION.

AND SO SO WE HAVE RENDERED RENDERED AN OPINION WHICH IS CONSIDERED AN UNMODIFIED OPINION.

AND THAT'S THAT'S AUDITING SPEAK NON AUDITING SPEAK WOULD BE IT'S A CLEAN OPINION.

OKAY BUT WHAT ENTIRELY DOES THAT MEAN IT ALL? IT DOESN'T MEAN THAT EVERY SINGLE NUMBER IS RIGHT OR ANYTHING LIKE THAT OR THAT WE EVEN LOOKED AT IT EVERY SINGLE TRANSACTION BECAUSE THAT'S NOT THE WAY AN AUDIT IS CONDUCTED.

WHAT IT DOES MEAN TO SAY IS THAT THE NUMBERS THAT ARE BEING PRESENTED AND WHAT WE'RE GOING TO GO THROUGH, THOSE NUMBERS ARE FAIRLY PRESENTED IN ALL MATERIAL RESPECTS.

NOT AN EXACT NOT EVERY EXACT NUMBER.

IMAGINE IF WE HAD AN AUDIT, EVERY EVERY SINGLE TRANSACTION, WE'D STILL BE AUDITING MAYBE.

BUT BASED UPON OUR TESTS PERFORMED ACCORDING TO THE STANDARDS, WE ARE RENDERING AN UNMODIFIED I.E.

CLEAN OPINION ON THESE NUMBERS FOR THE EDC.

OKAY THERE. I WILL SAY THAT THERE IS ONE ONE PARAGRAPH IN HERE THAT'S CALLED AN EMPHASIS OF MATTER PARAGRAPH.

OKAY. NOW THAT THAT'S A LITTLE DIFFERENT THAN YOU MAY SEE IN SOME OF THE OTHER REPORT.

AGAIN, JUST REMINDING THE READER.

ABOUT THAT NOTE RECEIVABLE FROM FROM SANTANA TEXTILES THAT IF YOU DON'T COLLECT IT RIGHT NOW, IT'S SITTING ABOUT 13% OF YOUR TOTAL ASSETS.

AND SO JUST HIGHLIGHTING HEY HEY, READER, AS YOU GO THROUGH THIS, JUST REMEMBER THIS NUMBER.

SO THAT TYPE OF DISCLOSURE IS ACTUALLY SIMILAR TO WHAT YOU'VE HAD IN THE PAST.

SO THAT SHOULD NOT BE UNUSUAL FOR THOSE THAT HAVE BEEN HERE FOR A BIT.

YES. THANK YOU. WE'RE ALL TOO FAMILIAR WITH THAT DEBT.

OKAY. OKAY, SO PAGE THREE.

PAGE THREE, FOUR, FIVE AND SIX, SEVEN.

I'M GOING TO SKIP. I WILL SAY THAT IF YOU HAD AN OPPORTUNITY TO READ IT AGAIN, IT'S THE CLIFF NOTES VERSION OF KIND OF WHAT YOU'VE DONE AND HOW NUMBERS COMPARED TO LAST YEAR. SO I'M GOING TO JUMP INTO PAGE TEN.

OKAY. AND HERE'S.

I'M NOT GOING TO ASSUME ANYTHING WHEN I SAY THIS.

SO JUST IF I. OKAY.

SO THE FINANCIAL STATEMENTS FOR THE EDC ARE PRESENTED UNDER A STANDARD CALLED GOVERNMENT AUDITING STANDARDS.

THERE ARE DIFFERENT STANDARDS FOR WHICH FINANCIAL STATEMENTS CAN BE PRESENTED EXCEPT THAT ACCEPT EXCEPT THAT THAT FOR US GOVERNMENT AUDITING STANDARDS.

AND SO THAT REQUIRES A PRESENTATION OF TWO STATEMENTS.

OKAY. ONE IS CALLED A STATEMENT OF NET POSITION AND ONE IS CALLED A BALANCE SHEET.

OKAY. PAGE TEN IS YOUR STATEMENT OF NET POSITION.

OKAY. WHAT THAT STATEMENT IS SUPPOSED TO TRY AND PRESENT IS, HEY, IF YOU WERE A BUSINESS, IF YOU'RE A BUSINESS, WHAT WOULD THIS ENTITY LOOK LIKE? OKAY. AND SO ON PAGE TEN, YOU HAVE THAT STATEMENT OF NET POSITION.

OKAY. AND YOU'LL SEE AT THE VERY BOTTOM OF YOUR BOTTOM LINE DRIVEN TOTAL NET POSITION OF 17,000,340.

MILLION $340,000.

OKAY. AND THE NUMBER I WANT YOU TO TO SEE, BECAUSE IT WASN'T LIKE THIS LAST YEAR WAS THAT UNRESTRICTED BALANCE OF 9,668,081. OKAY.

IF YOU'RE LOOKING AT NET POSITION AND YOU CAN EQUATE IT TO EQUITY OR WHATEVER THINGS OF THAT NATURE, YOU DON'T NECESSARILY WANT TO SEE A NEGATIVE NUMBER THERE.

RIGHT? NORMALLY, YOU WOULD THINK THAT THAT'S THAT'S NOT A GOOD THING.

OKAY. IN YOU ALL'S CASE, IT IS UNDERSTANDABLE IN WHAT I MEAN BY THAT IS THINK ABOUT.

THE TRANSACTIONS THAT YOU ALL ARE HAVING SPECIFICALLY AS IT RELATES TO THE CITY.

RIGHT. AND I'M GOING TO USE IT AS AN EXAMPLE.

[01:50:01]

MY GRANDMOTHER USED TO LIVE BY A TO DO LIST.

SO THAT'S THE ONE THAT THAT THAT RINGS TRUE TO ME.

OKAY. SO SO ANY TIME YOU ENTER INTO A TRANSACTION.

RIGHT NOW, THE CITY WHEREBY YOU'RE BUILDING, CONSTRUCTING SOMETHING FOR THE FOR THE INTENDED PURPOSE, THAT ONCE THAT ASSET IS COMPLETE, THAT YOU WILL TURN OVER THAT ASSET FOR SOMEBODY TO MAINTAIN.

IT'S THEIR DEAL.

OKAY. WELL.

WELL, YOU NO LONGER HAVE THAT ASSET.

SO YOU EXPENDED CASH OR INCURRED DEBT, RIGHT, TO BUILD THAT ASSET.

BUT THEN AT THE END OF THE PROJECT YOU JUST GET RID OF IT.

SO YOU'RE LEFT AND IF IT WAS DEBT, YOU'RE LEFT WITH A DEBT AND NO ASSET.

AND SO WHAT THAT DOES IS IT CREATES A NEGATIVE EQUITY LIKE IT DOES THAT NUMBER.

OKAY. IT IS NOT UNUSUAL.

OKAY. SO I WANT YOU TO IT IS NOT UNUSUAL.

WE'VE SEEN IT. OKAY? BECAUSE THAT'S THAT'S THE WAY ACCOUNTING WORKS.

IF YOU GIVE IF YOU BUILD AN ASSET AND YOU TURN IT OVER AND YOU'RE LEFT WITH DEBT, OF COURSE YOU'RE GOING TO HAVE NEGATIVE EQUITY.

SO I WANT TO I WANT TO POINT THAT OUT.

I ALSO WANT TO POINT OUT THAT IN DEVELOPING THIS STATEMENT.

THERE'S APPROXIMATELY $18 MILLION WORTH OF CORRECTIONS FLOWING THROUGH HERE.

OKAY. LET ME GIVE YOU THE CRUX OF THE BIGGEST ONE.

OKAY. THERE WERE SOME REFUNDED DEBT.

THAT IS A 2015 DEBT THAT WAS REFUNDED.

ET CETERA. THAT'S JUST THE WAY THEY WORK.

THE ESCROW BALANCE AND THE DEBT BALANCE WERE NEVER TAKEN OFF THESE FINANCIAL STATEMENTS.

OKAY. SO YOU MENTIONED CASH, RIGHT? WELL, ESCROW MONEY WOULD HAVE BEEN RESTRICTED TO BEGIN WITH, SO YOU COULDN'T HAVE USED IT.

BUT MY POINT IS, IF YOU SAW CASH LAST YEAR, YOU WOULD HAVE SEEN THIS HIGH LEVEL OF CASH THAT YOU DIDN'T REALLY HAVE.

AT THE SAME TIME, YOU WOULD HAVE HAD THIS HIGH LEVEL OF DEBT THAT YOU DIDN'T HAVE.

OKAY. THAT'S THAT'S THE BIGGEST ERROR THAT THAT FLOW THROUGH HERE.

THAT DEBT STILL STAYED ON THE BOOKS.

AND SO THAT DEBT IS NO LONGER PRESENTED HERE.

IT'S 2022 WHERE THE TRANSACTION WAS MADE OR WAS IT WHEN IN THIS HISTORY WAS THAT DONE? WELL, I THINK WE NOTICED IN 2010.

DO YOU REMEMBER WHEN 21, 21? IT WAS 20. 21.

YEAH. SO THE AUDIT FOR THAT TURNED INTO 20.

GO AHEAD. OH, AND SO AND THERE'S OTHER THINGS THAT ARE GOING ON PAGE.

I ACTUALLY READ IT, BUT I THINK IT'S ON PAGE 31 WHERE IT KIND OF GOES THROUGH THE ADJUSTMENTS.

RIGHT. OKAY. AND IT KIND OF RECONCILES.

WHERE ARE THESE NUMBERS FROM? THERE'S SOME OTHER ADJUSTMENTS IN THEIR RECONCILIATION.

TALK ABOUT, HEY, SANTANA WASN'T PROPERLY ALLOWED.

SO WE GOT PAST ALL THAT.

AND SO SO NOW WE'RE LEFT WITH THIS.

I WILL SAY, JUST AS AN ASIDE, YOU KNOW, THERE WAS A DISCUSSION ABOUT.

LASHES REPORT IS, LIKE MATERIALLY MISSTATED.

RIGHT? YOU KNOW, YOU GO BACK AND CORRECT THE PERMANENT RECORD.

RIGHT. TO MAKE IT TO TO MAKE IT RIGHT, BECAUSE IT IS IF SOMEBODY DIDN'T KNOW THIS AND JUST PULLED THAT REPORT, THEY'D SIT THERE AND REACH A DIFFERENT CONCLUSION. RIGHT.

THERE WAS THIS DISCUSSION, AND AT THE END OF THE DAY, IT WAS ABOUT CONSIDERING WHERE WE ARE TODAY WITH THIS REPORT, LET'S JUST MOVE FORWARD.

AND SO OBVIOUSLY, THAT'S UP TO YOU ALL TO DECIDE.

BUT BUT THAT'S WHAT HAPPENING.

THAT'S WHAT'S HAPPENING WITH THESE STATEMENTS.

OKAY. DOES THAT MAKE SENSE? GIVE YOU A BIG PICTURE ON THIS ONE.

MHM. OKAY. SO I'M GOING TO ASK YOU TO TURN TO PAGE 12.

SO. SO HERE'S MORE OF THE SILVER LINING PART OF IT.

OKAY. AS YOU MENTIONED ON PAGE 13, SORRY, PAGE 31, IT GOES THROUGH THERE AND RECONCILES THESE DIFFERENCES.

AND YES, THOSE STILL IMPACT THIS PARTICULAR STATEMENT.

BUT IN A NORMAL INSTANCE, JUST IN JUST IN THE INTEREST OF TIME AND PRESENTING AN AUDIT REPORT, I WOULD TELL YOU THIS.

I WON'T TELL YOU IF YOU DON'T UNDERSTAND ANYTHING ABOUT AN AUTO REPORT SUCH AS THIS.

OKAY. UNDERSTAND ONE NUMBER.

OKAY. AND THAT IS WHAT YOU HAVE IN YOUR UNASSIGNED GENERAL FUND.

[01:55:02]

IF YOU DON'T UNDERSTAND ANYTHING ELSE, UNDERSTAND THAT NUMBER.

OKAY. TOO LOW.

IT GETS YOU IN TROUBLE. TOO HIGH.

YOU START WONDERING WHETHER, HEY, ARE WE DOING THE KIND OF THINGS WE'RE SUPPOSED TO BE DOING BECAUSE YOU'RE STARTING TO STARTING TO INCREASE, RIGHT? THESE ADJUSTMENTS DID NOT AFFECT THAT NUMBER.

SO IF I LOOK AT UNASSIGNED BALANCE OF 10.270, ALL OF THESE THINGS I'M TALKING ABOUT DID NOT AFFECT THAT NUMBER.

SO IF YOU WERE MAKING DECISIONS BASED UPON THAT NUMBER, THEN YOU WOULD HAVE BEEN OKAY.

I HAD A NOTE TO MYSELF.

THIS IS WHAT WE CAN SPEND.

QUESTION MARK. IS THAT OKAY? WELL, IT'S NOT NECESSARILY SPAN, BUT I MEAN, I'M NOT SAYING THERE'S A CASH I'M NOT SAYING THIS CACHE.

IT'S NOT A GOOD WAY TO CATEGORIZE IT.

BUT IS THAT WHAT WE HAVE? YOU KNOW, THOSE THAT SIT ON ON THE BOARD YOU KNOW, WHEN YOU LOOK AT UNASSIGNED FUND BALANCE, THERE'S ALWAYS A METRIC, RIGHT? LIKE WHAT'S THE RIGHT NUMBER, RIGHT.

IF I JUST SAID HAVING TOO LITTLE IS NOT A GOOD THING AND HAVING TOO MUCH IS PROBABLY NOT A GOOD THING TOO.

LIKE, WHAT'S THE RIGHT NUMBER? THERE'S A NUMBER OF DIFFERENT METRICS.

I'LL SAY, LOOK, IF YOU'VE GOT.

A TYPICAL METRIC WOULD BE, HEY, 60 DAYS OR 90 DAYS OF UNASSIGNED FAMILY MAY HAVE HEARD THAT BEFORE, RIGHT? YEAH. OKAY. WE WENT SIX MONTHS, I BELIEVE.

WELL, IF YOU LOOK IF YOU LOOK AT THIS REPORT AND THIS IS THE SILVER LINING.

SO IF YOU GO TO PAGE 14.

OKAY. AND IF YOU CAN FOCUS YOURSELF TO THE MIDDLE OF THE PAGE AND LOOK AT TOTAL EXPENDITURES.

EXPENDITURES TO INCLUDE PRINCIPAL AND DEBT AND CAPITAL OUTLAY.

OKAY, THAT NUMBER IS $9.5 MILLION.

RIGHT. THE METRIC THAT I REFER TO IS ALWAYS, WELL, IF THE GOVERNMENT SHUT DOWN TODAY, HOW LONG COULD WE LAST? I SAID 60.

I SAID 90.

SOME SAY 20% OF EXPENDITURES.

YOU'RE CLOSE TO A YEAR.

OKAY. AGAIN, SOMETIMES TOO LITTLE IS BAD, BUT SOMETIMES TOO MUCH IS BAD.

THAT'S WHERE YOU ALL TO DECIDE.

RIGHT. IF YOU HAVE TOO MUCH, THE ARGUMENT CAN BE MADE, WELL, YOU'RE NOT MOVING DOING THE KIND OF THINGS THAT YOU'RE EXPECTED TO DO QUICKER AND FAST ENOUGH.

RIGHT. THAT'S JUST A COMMENT, BUT IT'S AT THE PACE THAT YOU FEEL COMFORTABLE WITH.

SO FROM THAT STANDPOINT, AND IF YOU LOOK AT FINANCIAL HEALTH BASED UPON THAT NUMBER, THEN YOU ALL ARE PRETTY, PRETTY SOLID.

OKAY. AND TO ME, THAT'S THE IMPORTANT STORY AS IT RELATES TO THIS STATEMENT.

ANYBODY HAVE A QUESTION ON THIS STATEMENT? COULD YOU SAY THAT STATEMENT A LITTLE MORE BOLDLY? NO MATTER THE ERRORS.

YEAH. SO I'M GLAD YOU YOU MENTIONED THAT, BECAUSE MY MY QUESTION ON THAT TYPE OF ERROR IS THAT DID THAT AFFECT IN ANY WAY THE EDC'S ABILITY TO FUND AND.

PROVIDE MONIES FOR ALL THE PROGRAMS THAT WE HAVE SINCE THEN.

AND DID THAT IN ANY WAY AFFECT ITS NO CAPACITIES? NO, NO. YOU KNOW, WE'RE WE'RE THE ERRORS BECOME IMPORTANT BECAUSE I JUST SAID IF YOU KNOW IF YOU'RE IF I'M SITTING IN YOUR CHAIR AND I'M NOT AN ACCOUNTANT AND I SAY, HEY, IF YOU DON'T KNOW ANYTHING ELSE ABOUT COUNTING, JUST FOCUS ON THIS ONE NUMBER.

THE PART ON FRONT THAT I JUST ALLUDED TO AND TALKED ABOUT, AND NOW YOU GOT THIS ALL THIS STUFF GOING ON.

IT'S REALLY FOR A THIRD PARTY REASON, RIGHT? SO ANYBODY THAT'S GOING TO ISSUE GIVE YOU GIVE YOU THAT WILL THEY WILL ASK ABOUT THAT NUMBER, RIGHT.

BECAUSE THERE'S ANY MONEY THAT WE DIDN'T HAVE TO SPEND.

BUT FOR YOU ALL'S PURPOSES.

YES, THAT'S IMPORTANT.

YOU CAN'T LOSE SIGHT OF IT.

YOU CAN'T YOU KNOW, I DON'T WANT TO MINIMIZE, BUT I'M I'M ALWAYS SAY, YEAH, UNASSIGNED, UNASSIGNED UNASSIGNED.

AND HERE YOU'VE GOT ALMOST A YEAR WORTH WORTH OF.

IMAGINE IF THE CITY HAD A YEAR'S WORTH OF EXCESS.

I MEAN. OH MY GOSH. YEAH, RIGHT.

THAT NUMBER IS IMPORTANT TO ME BECAUSE I, I KNEW I HAD HEARD IT BEFORE AND I THINK I BROUGHT IT UP AT A CITY MEETING.

HEY, DON'T WE HAVE IT CLOSE TO A YEAR OF.

AND THEY'RE LIKE, YEA, NO WAY.

BUT IT WAS, IT WAS THE EDC THAT WE HAD A YEAR.

WE HAD A YEAR THAT WAS PLANNED.

BUT YEAH, YOU KNOW, AND I THINK THAT'S FROM, FROM MY VIEWPOINT, THAT'S WHY.

IT'S GOOD WHEN WE HAVE DIFFERENT EYES, DIFFERENT CONTRACTS, DIFFERENT PEOPLE THAT GET HIRED BECAUSE YOU NEED DIFFERENT EYES INSTEAD OF THE SAME.

THE SAME PEOPLE LOOKING AT THE NUMBERS.

AND I WILL SAY, YOU KNOW, WE'VE LEARNED A LOT IN THE PAST YEAR WITH NEW FINANCIAL ADVISORS, NEW FINANCE PERSONNEL, NEW AUDITORS. AND SO THANK YOU FOR ALL YOUR WORK AND EXPLAINING IT ALL.

CAN I ASK YOU A QUESTION? ABSOLUTELY. SO WITH FISCAL YEAR ENDING IN THE NEXT 30 DAYS OR SO, HAS THERE BEEN A DIFFERENCE IN COMMUNICATION FOR THE UPCOMING

[02:00:05]

AUDIT THAT'S DUE OR IS THE PATTERN GOING TO REPEAT ITSELF? SO AGAIN, GOING BACK TO THOSE WEEKLY MEETINGS, THAT HAS BEEN A POINT OF DISCUSSION, YOU KNOW.

I CAN'T SPEAK FOR WHAT'S WHAT CITY STAFF IS DOING WITH RESPECT TO EDC AND THIS YEAR.

RIGHT. I WILL TELL YOU THAT OUR FOCUS WITH THEM IS LET'S GET THE CITY OUT.

BUT ALL OF US HAVE HAVE ACKNOWLEDGED, YOU KNOW, THIS IS AS SOON AS WE'RE DONE HERE.

WELL, GUESS WHAT? WE'RE JUST STARTING.

WE'RE GOING TO START AGAIN. YOU KNOW.

CORRECT. CORRECT. THAT HAD A LOT OF SCHEDULING AND FEES.

BUT AT THE END OF THE DAY, IT DOESN'T JUST NEED TO BE DONE.

IT NEEDS TO BE DONE RIGHT.

THAT'S ALWAYS BEEN OUR PHILOSOPHY.

SO. AND SO A QUESTION I HAVE IS WHEN THERE'S DELAYS LIKE THAT, YOU CAN BE REQUESTING INFORMATION FROM STAFF DAY TO DAY, CURRENT OBLIGATIONS, AT LEAST TO KEEP SOME SORT OF WORK GOING INSTEAD OF WAITING FOR REPORTS FROM OBVIOUSLY DELAYED REPORTS FROM FROM FINANCE STAFF THAT THAT IS HAVING ISSUES.

YOU CAN BUT IT BECOMES, YOU KNOW, MAYBE A PHILOSOPHICAL DISCUSSION BECAUSE YOU GET THEM.

THERE'S ONLY SO MANY HOURS IN A DAY.

DO I WANT THEM FOCUSED, THOSE EIGHT HOURS ON JUST TRYING TO, YOU KNOW, GET THE PAST OR DO YOU WANT TO SPLIT THE HALF TO FINISH THE PAST AND HALF YOU'D RATHER GET GET THE INFORMATION FROM THEM TO KNOW YOU'RE GOING DOWN THE RIGHT PATH? WELL, I GET THAT, BUT WE DON'T KNOW WHAT WE DON'T KNOW.

AND SO IT'S IMPORTANT THAT IF WE PUT ON NOTICE, WE CAN, YOU KNOW, LIGHT A FIRE OURSELVES AND MAKE SURE THAT THE RIGHT INFORMATION IS GETTING BECAUSE NOW IT'S THEY'RE REPRESENTING US IN A SENSE.

RIGHT. AND WE'RE PAYING FOR THAT REPRESENTATION.

AND SO WE WANT TO MAKE SURE THAT WHATEVER YOU NEED IS GETTING GETTING TO YOU.

AND SO IF IT MEANS, YOU KNOW, A PHONE CALL, THEN WE CAN THEN THE BOARD CAN TAKE ACTION TO SEE IF IF WE CAN MOVE THINGS ALONG.

PAGE 14. I GUESS I'VE GOT THREE MORE THINGS AND I'LL WRAP IT UP HERE.

ON PAGE 14. AGAIN, IF YOU'RE ONE OF THOSE JUST A BOTTOM LINE ORIENTATED.

AND HOW DO WE DO? WELL, OF COURSE, THIS NET CHANGE IN FUND BALANCE IS, YOU KNOW, YOU PRETTY MUCH BROKE EVEN EXPENDITURE IS PRETTY MUCH EQUAL TO REVENUES.

YEAH, IT'S -83,000.

BUT AS A PRACTICAL MATTER.

OH, EXCUSE ME. AS A PRACTICAL MATTER, YOU'RE BROKE EVEN.

OKAY. I WAS GOING TO POINT OUT THAT FOOTNOTE THAT THAT YOU MENTIONED, BUT I THINK WE'VE KIND OF.

UNDERSTOOD THAT. THERE WAS ONE OTHER FOOTNOTE I JUST WANT TO JUST BRING UP BEFORE I JUMP TO THE OTHER PART OF THE REPORT, AND THAT IS ON PAGE 30, JUST TO IDENTIFYING WHAT YOU COMMITMENTS ARE LEVEL AT THAT TIME AND THE PROJECT THAT YOU HAD REMAINING.

AND THEN AND THEN ALSO JUST IDENTIFYING JUST THE BENEFICIARY OF THOSE PROJECTS.

OBVIOUSLY YOU SEE VANGUARD AND MOST MOSTLY.

STEPHEN BURGE. BUT THAT FOOTNOTE IS THERE IN CASE THAT INTEREST YOU.

I HAD A QUESTION ON PAGE.

MAYBE YOU CAN EXPLAIN IT TO ME A LITTLE BIT.

PAGE 27 ON THE DEFEASANCE OF DEBT.

SO I DIDN'T KNOW WHETHER DEFEASANCE OF DEBT WAS.

AND I THOUGHT, OKAY, SO IT'S BASICALLY WHEN YOU VOID A BOND OR A LOAN ON A BALANCE SHEET, WHEN THE BORROWER SETS ASIDE CASH OR BONDS SUFFICIENT TO SERVICE THE DEBT, I LOOKED IT UP.

SO BASICALLY YOU YOU CAN VOID IT NOW BECAUSE YOU KNOW, YOU HAVE ENOUGH TO SET THAT ASIDE.

BUT WHAT DOES THAT MEAN IN TERMS OF THE 13 MILLION THAT YOU SAY REMAINS OUTSTANDING? SO THAT'S A 13 MILLION.

THAT'S. YOU WHEN YOU DEFEAT SADAT, YOU TAKE MONEY THAT YOU HAVE AND YOU GIVE IT TO A THIRD PARTY.

RIGHT. TYPICALLY A TRUST DEPARTMENT AT A BANK.

RIGHT. AND SO WHEN YOU GIVE IT TO A THIRD PARTY, THEN THEY'RE RESPONSIBLE NOW FOR MAKING FOR FOR MAKING THOSE DEBT PAYMENTS FOR YOU.

AND SO ALL WE'RE DISCLOSING IS HOW MUCH ARE THOSE STILL OUTSTANDING THAT STILL NEED TO BE DUE TO BE PAID.

SO THAT'S THE 13 MILLION THAT'S STILL OUTSTANDING.

OKAY. THEY'RE NOT THEY'RE NOT NECESSARILY ON YOUR BOOKS UNLESS UNLESS, FOR EXAMPLE, IF YOU HAD LIKE I'M MAKING UP THE NUMBERS LIKE 9% DEBT AND THEN YOU GO GET 2% DEBT.

RIGHT? AND SO AND SO YOU WANT TO PAY OFF THAT 9%.

SO YOU TAKE ON NEW DEBT AT 2%.

YOU TAKE THE PROCEEDS AND PUT IT IN A TRUST DEPARTMENT OR SOMEWHERE, AND THEY CONTINUE TO SERVICE THAT DEBT FOR YOU.

AND YOU YES, YOU GOT DEBT, BUT NOW IT'S 2% DEBT.

OKAY, BUT THAT'S THE WAY IT ALSO REMOVED FROM BALANCE SHEET, RIGHT? YEAH. AND THAT WAS THE ISSUE.

THAT WAS THE ISSUE THAT I WAS REFERRING TO THAT CAUSED THAT THOSE THOSE ADJUSTMENTS.

IT WASN'T REMOVED.

YEAH. WHICH IS A PRIMARY FUNCTION OF THAT.

OR ONE OF THEM FOR THE PURPOSE TO GET IT OFF? YES. YES.

SO SO THE OTHER THING I WANTED TO I WANTED TO POINT OUT AND JUST ACKNOWLEDGE AND I'LL WE'LL GO THROUGH THIS IN AS MUCH DETAIL AS YOU WOULD LIKE, BUT SO I'LL START

[02:05:03]

HERE. AND IF IT'S SUFFICES, THEN THAT'S FINE.

SO ON PAGE 39 AND 40.

YOU'LL SEE. YOU'LL SEE A LETTER AND THAT LETTER IS REQUIRED.

IT'S REQUIRED UNDER, I MENTIONED EARLIER, GOVERNMENT AUDITING STANDARDS.

I GOT TO PUT TOGETHER A LETTER.

OKAY. AND ONE OF THE THINGS THAT SPEAKS TO IS, YOU KNOW, INTERNAL CONTROLS AND THINGS OF THAT NATURE.

AND HERE'S HERE'S WHERE FOR DEFICIENCIES IN INTERNAL CONTROLS ARE BEING IDENTIFIED.

RIGHT. AND AND THEY'RE BEING CATEGORIZED BETWEEN MATERIAL WEAKNESSES, WHICH ARE YOU KNOW, I DON'T WANT TO SAY THE WORST THING YOU CAN HAVE, BUT I'M JUST SAYING, IF YOU HAD TO RANK THEM, YOU KNOW, MATERIAL WEAKNESS WOULD BE, YOU KNOW, THE MOST SEVERE AND THEN YOU'D HAVE SIGNIFICANT DEFICIENCIES WOULD BE THE NEXT.

AND THEN YOU HAVE OTHER COMMENTS.

OKAY. AND SO WE ARE REPORTING TO YOU.

23455. COMMENTS ONE THE FIRST ONE WHICH IS A MATERIAL WEAKNESS.

AND THE OTHER FOUR RELATE TO SIGNIFICANT, SIGNIFICANT DEFICIENCIES.

I CAN GO THROUGH. THIS IS.

I'M AT YOUR PLEASURE. SO IF.

WE ALL HAVE SPENT THE TIME AND JUST WANT JUST TO ABSORB THEM AND PERCOLATE THAT AMONGST YOURSELF AND MANAGEMENT.

AND THAT'S TOTALLY FINE.

OR WE CAN GO THROUGH HERE ONE BY ONE.

BUT JUST I JUST WANT TO KNOW THAT THERE'S THINGS IN HERE THAT NEED TO BE CORRECTED.

AND WHAT YOU ALSO HAVE IS A RESPONSE FROM MANAGEMENT ON HOW THEY PLAN ON ADDRESSING THE MATTER.

YEAH, THOSE WERE THE ONES I KNOW FROM UNIVERSITY.

YOU NEVER WANT TO SEE A MATERIAL WEAKNESS ON ON ANYTHING OR EVEN THE SIGNIFICANT.

SO I THINK ON, ON NUMBER ONE, THE MATERIAL WAS THE ONE YOU TALKED ABOUT WHERE THERE WERE MISTAKES MADE IN, IN WHAT WAS STILL CARRIED OVER FROM THE.

YEAH. AND SO NOW AT LEAST WE KNOW THAT THOSE HAVE BEEN THERE'S THERE'S SOME TRANSPARENCY NOW THEY THEY KNOW THEY EXISTED.

THOSE HAVE BEEN REMOVED.

AND WE NOW HAVE A CLEAN SET IN THE SENSE THAT.

WELL AND AND DEVELOPING INTERNAL CONTROLS TO ENSURE IT DOESN'T HAPPEN AGAIN.

BUT WE WANT TO MAKE SURE THAT IT DOESN'T HAPPEN AGAIN.

OKAY. UM, THE OTHER ONE HAD TO DO, WHICH I WASN'T SURE, THE INVESTMENT POLICY, WHICH WAS NUMBER TWO.

UM, AND THAT WE DIDN'T COMPLY WITH THE PROVISIONS OF THE PUBLIC FUNDS INVESTMENT ACT BECAUSE WE DID NOT HAVE AN INVESTMENT POLICY IN PLACE FOR THE END OF SEPTEMBER 2022.

SO DO WE HAVE ONE NOW AND WAS THAT AN INVESTMENT POLICY? WAS THAT SOMETHING THAT THE CITY WAS DOING FOR US AND THEIR CAPACITY, OR IS THAT SOMETHING WE WERE SUPPOSED TO DO ON OUR OWN? WE CAN WE CAN ACTUALLY WE SHOULD HAVE AN INVESTMENT POLICY THAT MIRRORS THE CITY'S INVESTMENT POLICY.

BUT THE CITY DID NOT HAVE AN INVESTMENT POLICY.

YEAH. SO. SO. SO HERE.

SO HERE'S WHERE WE MAY BE SPLITTING SOME HAIRS.

RIGHT? SO YOU'RE YOU'RE A BORED CORPORATE.

YOU'RE SEPARATE ENTITY.

YES. RIGHT.

THE MAJORITY OF THE PEOPLE ON THIS ON THIS BOARD ARE NOT CITY APPOINTED, RIGHT? CORRECT. OKAY. SO SO YOU HAVE AN OBLIGATION, I THINK, TO HAVE YOUR OWN POLICY.

IT COULD BE THE SAME POLICY.

OKAY. BUT WE BELIEVE WE HAVE AN OBLIGATION TO HAVE YOUR OWN POLICY.

AND IF YOU'RE GOING TO COMPLY WITH THE ACT, THERE ARE SOME OTHER THINGS RELATED TO INVESTMENT TRAINING AND THINGS OF THAT NATURE.

I'M NOT SUGGESTING IF YOU LOOK AT YOUR HISTORY OF INVESTING, IT'S PRETTY CONSERVATIVE.

JUST LIKE MOST ENTITIES.

IT DOESN'T HAVE TO BE OVERLY COMPLICATED OR OR WHATNOT.

BUT I DO THINK THAT THERE IS SOMETHING THAT YOU ALL SHOULD HAVE THAT'S DIFFERENT, BUT THERE IS SOME MAIN POINTS IN THERE IN TERMS OF DIVERSIFICATION, RISK TOLERANCE, POLICY.

I MEAN, THERE IS SOME THAT YOU SHOULD HAVE.

THERE IS. SO ANYBODY READS THAT AND WE'RE AGGRESSIVELY.

INVESTING IN SOMETHING.

IT'S IN THE POLICY.

SO WE'RE DOING WHAT WE'RE DOING.

YEAH, I THINK I THINK I THINK IT WOULD BE PRUDENT BECAUSE IT CERTAINLY COULDN'T HURT.

RIGHT. I THINK WE'D BE PRUDENT TO HAVE YOUR OWN POLICY.

RIGHT. SO JUST BASED ON, AGAIN, SOME PRIOR HISTORY IS ANNUALLY, THE BOARD CAN LOOK AT THE POLICY AND WE CAN ADOPT THE CITY'S POLICY.

BUT WE DO NEED TO MAKE A MOTION ON IT.

OR PROVING IT. YEAH.

YEAH. NO, I THINK WE MOST DEFINITELY HAVE TO HAVE OUR OWN.

WE CAN LOOK AT WHAT THE CITY IS DOING, BUT WE WE SHOULD BE ABLE TO REVISE THAT IF WE DON'T LIKE WHAT THAT POLICY IS.

AND DON'T FORGET, THERE ARE OTHER ASPECTS OF THAT ACT RELATED TO TRAINING.

YEAH. SO, YEAH, NOTICE THAT IT SAYS WE HAVE TO GO THROUGH A TRAINING AS WELL.

[02:10:02]

OKAY. AND THEN YOU SAID ON THE, ON THE OTHER ONE, THE OH THREE, THAT ONE WAS THE DISASTER RECOVERY PLAN.

CORRECT. AND YOU SAID THAT THE CITY HAD BEEN WORKING ON THAT.

IS THAT ANOTHER ONE OF THOSE WHERE WE DO OUR OWN? YEAH, BECAUSE YOUR ACCOUNTING IS ON THEIR SYSTEM.

YEAH. IT WOULD SEEM TO ME THAT YOU WOULD WANT TO KNOW THAT YOUR DATA IS CAN BE RECOVERED.

THIS IS BASICALLY PROTECTING YOUR DATA.

RIGHT. RIGHT. AND SO AT THIS POINT TURN ALL THE CITY HASN'T IS WORKING ON TRYING TO GET THEIRS GOING.

BUT BY DEFAULT, THAT PUTS YOUR DATA AT RISK.

AND THEN THE LAST ONE WAS TO ASSURE ADEQUATE CONTROLS ARE IN PLACE.

AND ME. SEE? WHAT WAS THAT ONE? YEAH. ZERO FOUR.

ADEQUATE CONTROLS IN PLACE FOR TIMELY COMPLETION SO THAT WE'RE NOT HAVING THIS ISSUE WITH LAST MINUTE TURNOVER OF DOCUMENTATION AND SO FORTH.

OKAY. I WILL SAY THIS, AND ONLY BECAUSE YOU MENTIONED THE WORD.

TURNOVER BECAUSE I DON'T WANT TO MINIMIZE THIS POINT.

IS, I DON'T KNOW, TEN YEARS AGO.

ACCOUNTS WERE GENERALLY EASY TO FIND.

OKAY. BUT IT IS A REAL THING THAT ACCOUNTANTS ARE EXTREMELY DIFFICULT TO FIND.

SO I'M NOT MAKING EXCUSES FOR THIS CITY, BUT I JUST WANT TO TELL YOU THAT THAT IS A REAL THING.

A REAL CHALLENGE.

WALL STREET JOURNAL HAS WRITTEN ABOUT IT MORE THAN ONCE ABOUT JUST A LACK OF ACCOUNTS AND THE IMPACT IT'S HAVING, NOT JUST ON GOVERNMENTAL ENTITIES, BUT NOW IT'S STARTING TO AFFECT, YOU KNOW, PUBLIC COMPANIES.

AND SO I JUST WANT TO JUST IT'S A REAL THING.

DON'T DON'T JUST SAY, OH, JUST GO HIRE SOME PEOPLE.

WELL, NO, THAT'S NOT WELL.

AND I KNOW I MEAN, THE CITY HAS BEEN IN THE PROCESS OF THEY HAD BEEN LOOKING TO HIRE SOME ACCOUNTS OR ACCOUNTANTS.

ACCOUNTANTS. ACCOUNTANTS.

OH, YES, YES, YES. DIFFICULT TO HIRE.

YEAH. YEAH, THAT'S A GOOD POINT.

YEAH. THEY ARE RETIRING, RIGHT? THAT'S A GOOD POINT, BECAUSE EVERYTHING WE'RE TALKING ABOUT ENDS FISCAL YEAR 2022, RIGHT? SEPTEMBER 9TH OF 2022.

SO WE'RE TALKING ABOUT OCCURRENCES THAT HAPPENED FROM 921 TO 922, WHICH JUST AS EVERYONE KNOWS, WE HAVE A COMPLETELY DIFFERENT FINANCE DIRECTOR NOW.

BACK THEN IT WAS COMPLETELY DIFFERENT ADMINISTRATION.

AND SO FOR NEW STAFF COMING IN, IT WAS, FROM WHAT I GATHER, WAS PRETTY DIFFICULT TO MAKE SENSE OF OTHER PEOPLE'S WORK FROM BACK THEN.

YEAH. AND SO THAT'S AN ONGOING CHALLENGE.

I KNOW THE CITY HAS HIRED, BUT THEN THEY DON'T STICK AROUND.

I MEAN, EVERYBODY'S COMPETING AND LIKE YOU SAID, WE HAD WE HAD AN INTERIM FOR A LITTLE WHILE, TOOK US A WHILE TO FIND SOMEONE TO HIRE.

WE TEND TO BE LOW ON EVERYBODY'S RADAR UNTIL YOU DON'T HAVE ONE, RIGHT? RIGHT. THEN BECOMES AN ISSUE.

RIGHT. KIND OF HOPEFULLY KIND OF WHAT THEY SAY ABOUT LAWYERS.

YEAH. HOPEFULLY THEY DON'T LIKE THEM UNTIL YOU NEED ONE.

HOPEFULLY THIS NEXT AUDIT WOULD BE A LOT EASIER FOR YOU.

I HOPE SO. SO AND I WILL SAY IT WAS A DIFFERENT AUDITOR.

A DIFFERENT FINANCIAL ADVISOR.

YEAH. COMPLETE OVERHAUL OF CITY ADMIN AND FINANCE DEPARTMENT ADMIN, AS WELL AS THE CONSULTANTS OR OUTSIDE AUDITORS THAT THAT ARE NOW NEW SINCE LAST YEAR.

NOT NOT DURING THIS TIME.

YEAH THERE'S ONE COMMENT LEFT.

JUST YOU TURN THE PAGE JUST IN CASE.

I DON'T KNOW IF YOU ALL HAD A QUESTION ON THAT WHAT THAT REFERRED TO.

AND I CAN SUMMARIZE BY JUST SAYING YOUR DEBT OR CERTAIN DEBT HAS CERTAIN COVENANTS THAT REQUIRES YOU TO MAINTAIN CERTAIN BALANCES AND SINKING FUNDS AND THINGS OF THAT NATURE.

AND IT'S IMPORTANT TO MONITOR.

I MEAN, YOU DON'T WANT TO BE NON-COMPLIANT OF A DEBT COVENANT.

AND IN FACT, IF YOU LOOK AT FORGET YOUR JUMP TO PAGE 24.

BECAUSE THIS IS REALLY WHAT WHAT IT PERTAINS TO.

AND JUMP OVER TO PAGE 24.

YOU SEE A YOU SEE A FOOTNOTE THAT SAYS SINKING FUNDS, A SINKING FUNDS REQUIRED BY YOUR DEBT COVENANT.

AND YOU'LL NOTICE A NEGATIVE NUMBER.

REMEMBER, WE DON'T LIKE NEGATIVE NUMBERS.

YOU SEE, YOU WERE SHORT.

OH, THE 12,015.

YEAH. IT WASN'T MATERIAL ENOUGH FOR US, TOO.

BUT IT'S IMPORTANT ENOUGH YOU DO NOT WANT TO BE POLISHING YOUR DEAD COFFINS, RIGHT? AND SO. AND THAT'S JUST THE COMPUTATION AND MONITORING.

SO. ON THOSE WHERE THEIR BOND RESERVES AND THIS IS MAYBE A QUESTION FOR OUR STAFF, BUT HOW DO YOU HOW DO YOU FIX THAT? CAN YOU JUST TRANSFER MONEY IN? OKAY. YEAH.

[02:15:02]

OKAY. YOU GOT TO MAKE UP FOR THAT DEFICIENCY.

WE HAVE DONE THAT THIS LAST MONTH.

LAST WEEK. OKAY.

SO AT THIS POINT, WE SHOULDN'T SEE ANY THERE SHOULDN'T BE ANY DEFICIENCY OR ANY SINKING FUND.

YEAH. I MEAN, OUR MEASUREMENT DATE IS ONLY AT ONE POINT OF TIME.

YEAH, BUT STAFF SHOULD BE DOING IT NO LESS THAN MONTHLY.

IN TODAY'S ENVIRONMENT.

YOU CAN MAKE SOME MONEY RIGHT NOW. MR. LONGORIA. JUST FOR THE RECORD, WHEN WHEN WERE YOU HIRED AS A NEW AUDITOR? YES. OUR ENGAGEMENT WAS ACTUALLY REFERRED TO IN THAT FIRST LETTER I MENTIONED TO YOU.

WE WERE HIRED ON SEPTEMBER 9TH, 2022.

THAT'S THE DATE OF OUR ENGAGEMENT LETTER.

WE HAD A FIRST MEETING WITH MANAGEMENT IN NOVEMBER.

IT'S NOT ABOUT RIGHT. WE'VE BEEN AT IT EVER SINCE.

IT'S BEEN. IT'S BEEN A LONG HAUL.

OKAY. THANK YOU FOR COMING ON.

THANK YOU FOR.

AND THANK YOU FOR EXPLAINING IT.

I HOPE THAT MAKES SENSE.

THANK YOU. THANK YOU. THANK YOU.

OH, AND YOU MAY HAVE EXPLAINED THIS.

LET ME SEE IF I HAD. OH, YOU DID.

YOU DID. I'M SORRY. ON THE EXPENDITURES EXCEEDING APPROPRIATION.

THAT WAS THE ONE WHERE I HAD HAD QUESTIONS.

BUT YEAH, YOU EXPLAIN THAT.

WELL, THANK YOU ALL FOR YOUR TIME AND HAVE A GOOD DAY.

OKAY. VERY GOOD.

WE ARE HERE TO SERVE. SO THANK YOU.

THANK YOU, SIR. THANK YOU FOR ALL YOUR WORK.

THANK YOU ALL. OKAY.

SO I THINK WE NEED TO MAKE A MOTION TO ACCEPT THE THE 2022 AUDIT.

CAN I GET A MOTION BEFORE WE DO THAT? RONDELL YOUR RECOMMENDATION IS TO ACCEPT THIS AUDIT.

MY RECOMMENDATION IS TO ACCEPT THE AUDIT.

YES, THIS IS SOMETHING THAT.

IS PART OF THE PROCESS.

THERE WAS A LOT OF TURNOVER, AS THEY SAID WHEN I CAME IN AND WAS ASKING QUESTIONS, THERE WAS HARD TO GET ANSWERS.

TO THIS DAY, IT'S STILL A LITTLE DIFFICULT, BUT WE'RE WE'RE WORKING THROUGH IT AND I SEE THAT THERE IS A DIFFERENCE NOW, AS DAN WAS ALLUDING TO, IN TERMS OF THE PERSONNEL.

AND IT SEEMS LIKE THEY'RE STARTING TO STAFF UP AT THE FINANCE DEPARTMENT AND THAT'S GOING TO MAKE A DIFFERENCE.

I'M STAFFING UP ALSO, AND THAT MAKES A DIFFERENCE FOR ME TO LOOK AT THIS EVEN CLOSER.

BUT YEAH, WE'LL SEE A BIG IMPROVEMENT ONE YEAR OVER THE NEXT.

YEAH. AND THE ONLY REASON I ASK THAT IS BECAUSE, YOU KNOW, US AS BOARD MEMBERS WE LOOK OVER.

BUT OF COURSE WE'RE NOT. PROFESSIONALS IN ALL THIS.

AND I WOULD ADD ALSO FROM A FROM A BOARD PERSPECTIVE PERSONALLY, SOMETHING LIKE ACCOUNTING AND LEGAL MATTERS SHOULD NEVER BE A SURPRISE TO THE BOARD.

THIS WAS A SURPRISE FOR ME TODAY.

AND IN THE FUTURE I WOULD LIKE NO SURPRISES.

UNDERSTOOD. SO WE'VE GOT A RECOMMENDATION TO ACCEPT THE AUDIT.

CAN WE GET A MOTION TO ACCEPT THE AUDIT? 22. 2022.

AUDIT. I'LL MAKE A MOTION.

SECOND. WE'VE GOT THE MOTION AND A SECOND.

ALL IN FAVOR. SAY AYE. RAISE YOUR RIGHT HAND.

THANK YOU. MOTION PASSES.

ARE YOU ALL OKAY WITH THAT? WE NEED A MOTION FOR THAT. HOMER.

YES. ON THE ITEMS THAT YOU DO WANT TO TAKE INTO EXECUTIVE, YOU WOULD NEED TO MAKE A MOTION ON THOSE JUST TO MAKE THAT CLEAR.

OKAY. OKAY. SO F IS THE PERSONNEL COMPENSATION PLAN.

G IS THE SERVICES AGREEMENT BETWEEN THE CITY OF EDINBURG AND THE EDC.

YOU HAVE A FRONT PAGE OR A COVER PAGE? I DON'T THINK THEY HAVE THAT.

IT'S ON THE AGENDA. I'M SORRY.

YEAH, GO BACK TO THE AGENDA.

NOT ALL OF IT. WE DIDN'T HAVE THE AGENDA.

YEAH, WE'RE MISSING THAT. YEAH, I GUESS I PRINTED IT OUT FROM ONLINE.

DO YOU HAVE THAT? IS THAT NOT PART OF YOUR.

YEAH. NO, WE DON'T HAVE. I'M LOOKING AT MY FOLDER THAT I PRINTED FROM THE OFFICE OF AGENDAS.

[02:20:06]

OKAY. AND YOU CAN PULL IT UP ON YOUR PHONE.

THANK YOU, CARLOS. YEAH.

SORRY ABOUT THAT, GUYS.

I DIDN'T KNOW THAT IT DIDN'T INCLUDE IT.

I WAS PRINTING. I PRINTED IT OUT.

ONE. YEAH. SO WHAT WERE YOU SAYING? OKAY, SO IF YOU LOOK AT I WAS THINKING WE DO D AND E HERE.

WE DISCUSS IN EXECUTIVE F AND H, AND THEN WE COME BACK INTO OPEN SESSION.

AND IF WE NEED TO VOTE ON ANY OF THOSE, WE DO THAT BACK WHEN WE GET BACK FROM OPEN SESSION.

I'LL MAKE A MOTION TO MOVE TO EXECUTIVE SESSION.

SECOND. ALL IN FAVOR SAY AYE.

RAISE YOUR RIGHT HAND. OKAY, THAT PASSES.

SO WE'LL DISCUSS THOSE AND THEN COME BACK TO THEM IN OPEN SESSION AFTER EXECUTIVE.

OKAY. SO ITEM D IS THE APPROVAL OF THE REQUEST.

CONSIDER APPROVAL OF A REQUEST FROM THE MUSEUM OF SOUTH TEXAS HISTORY TO SPONSOR FANDANGO 2023 AND.

I THINK THEY'RE THE THE REQUEST WAS ANYWHERE FROM 1600 TO 2600.

THOSE WERE THE SPONSORSHIP LEVELS.

INCLUDED IN YOUR PACKET WAS THE REQUEST FORM WITH THE INFORMATION.

FANDANGO, I THINK, HAS BEEN A PRETTY BIG EVENT THAT THE MUSEUM HAS EVERY YEAR.

AND IF YOU LOOK ALSO IN THERE AT THE VERY END, IT TALKS ABOUT FUNDING HISTORY AND WHAT THEY'VE BEEN RECEIVING FROM EITHER.

ORGANIZATION RECEIVED OTHER FUNDING FROM THE EDC AND OR THE CITY OF EDINBURGH.

AND THEN IT LISTS PER YEAR.

COULD YOU EXPLAIN THAT RIDDLE? I WASN'T SURE WHAT THE $255,000 WAS.

IS THAT FROM THE CITY? THE 255.

THOUSAND. THAT THEY GOT FROM US.

THAT'S FROM THE CITY. I GUESS THAT THEY FUND THE MUSEUM.

AND THEN BEHIND THAT IS THE ACTUAL EVENT.

IT'S OCTOBER THE 7TH.

SUPPLIER AND IT TELLS YOU WHAT YOU GET FOR THE TWO DIFFERENT.

SPONSORSHIP LEVELS THAT ARE BEING PROPOSED.

THIS ISN'T VERY DIFFERENT FROM OTHER EVENTS WHERE WE'RE SPONSORING A TABLE.

THE DIFFERENCE IS THAT OUR SPONSORSHIP POLICY HAS LEVELS THAT EXCEED MY AUTHORITY SIX $1,600 VERSUS $1,000. THAT'S THE DIFFERENCE.

IT'S A $600 DIFFERENCE TYPICALLY.

AND I'M GOING TO SUGGEST FOR THE NEXT ANNUAL MEETING THAT WE CHANGE THE SPONSORSHIP LEVELS, THE POLICY.

THIS WOULD BE SOMETHING THAT THAT IS VERY MINOR AND THUS I'M RECOMMENDING A $1,600 SPONSORSHIP.

IT'S A GOOD COMMUNITY EVENT.

IT'S A GOOD WAY FOR THE EDC TO BE OUT THERE AND BE VISIBLE AND ALSO GET THEMSELVES OUT IN FRONT OF POTENTIAL PROSPECTS AND GET OUR NAME OUT.

IT'S A IT'S A RELATIVELY MINOR EXPENSE COMPARED TO A LOT OF THE OTHER THINGS THAT WE'RE DOING.

SO YOU THINK THE RETURN ON THE INVESTMENT WOULD BE SUFFICIENT TO SPONSOR IT? THE LEVEL OF 1600? YEAH, FOR $1,600, THE ADVERTISING ITSELF IS WORTH MORE THAN THAT.

OKAY. WHAT PROSPECTS WERE YOU TALKING ABOUT? PROSPECTS WOULD ATTEND THIS.

I'M SORRY. I CAN'T HEAR YOU. YOU SAID IT.

YOU SAID IT WOULD. WE CAN GET IN FRONT OF PROSPECTS.

WHAT PROSPECTS? WELL, YOU NEVER KNOW WHO'S THERE.

OKAY. WELL, IT IS AN EVENT THAT DRAWS A LOT OF THE BUSINESS PEOPLE OF OF THE CITY DEVELOPERS AND OTHERS TO THE MUSEUM.

YEAH, I THINK WE'RE GOOD.

WE'RE GOOD. 1600.

OKAY. CAN WE GET A CAN I GET A MOTION TO SPONSOR AT THE RECOMMENDED LEVEL OF 1600? I'LL MAKE A MOTION TO EDDIE.

EDDIE MAKES A MOTION.

CAN I GET A SECOND? SECOND AND ROLL IN SECOND? ALL IN FAVOR. SAY AYE. RAISE YOUR RIGHT HAND.

OKAY. 1600.

ALL RIGHT. NOW THAT WE ALL HAVE AN AGENDA.

THE OTHER ITEM IS ON THE PRESENTATION OF YEAR TO DATE FINANCIAL REPORT ENDING ON JULY 31ST, 2023.

OKAY. FINANCIAL REPORT IN YOUR PACKET IS REALLY WHAT I HAVE TO DEAL WITH ON A FAIRLY REGULAR BASIS.

[02:25:08]

THAT'S NOT TRUE.

THERE WAS APPROXIMATELY $700,000 WORTH OF GENERAL SALES TAX THAT CAME TO US.

IT'S NOT REFLECTED IN THIS REPORT.

I DON'T EVEN WANT TO PRESENT THIS REPORT, BUT IT WAS GIVEN TO ME.

THIS IS THE STUFF THAT I HAVE TO DEAL WITH.

I GET MORE INFORMATION SOMETIMES ONLINE FROM THE GENERAL FROM THE COMPTROLLER'S OFFICE THAN I DO FROM MY OWN FINANCE DEPARTMENT.

SO IT'S DIFFICULT TO TO PRESENT SOMETHING TO YOU ALL THAT'S NOT READY.

YEAH, I THINK I THINK THAT'S THE WAY WE NEED TO GO BECAUSE IT'S PRETTY HARD TO PROVE SOMETHING OR SOMETHING THAT WE CAN'T RELY ON.

KNOW IT'S NOT ACCURATE, IT'S INACCURATE, AND IT'S HARD FOR ME TO TO REVIEW IT UNTIL I PUT IT IN A FORMAT THAT'S UNDERSTANDABLE TO ME AS WELL.

A MOTION TO PASS ON THE TABLE.

MOTION TO TABLE. SECOND.

SECOND. OKAY. SO ALL IN FAVOR SAY AYE.

OKAY, THAT ITEM IS TABLED.

OKAY. SO CAN WE GET A MOTION TO GO INTO EXECUTIVE SESSION TO CONSIDER THE REMAINING ITEMS ON THE AGENDA? SECOND, ALL IN FAVOR SAY AYE.

AT 640 AND WE ARE ENTERING INTO EXECUTIVE SESSION.

I THINK. I HAVEN'T HAD TO USE IT YET, BUT I DON'T.

THAT'S.

[02:30:54]

I'D LIKE TO CALL THE MEETING TO ORDER OF THE EDINBURG ECONOMIC DEVELOPMENT CORPORATION.

LET'S START WITH CALLING ROLE.

PARENTS LEAVE IT UP. THEN THIS.

ROLAND GOMEZ PRESENT.

WE HAVE. POOR MAN. THANK YOU SO MUCH.

RAUL RESENDEZ.

EDDIE GARCIA PRESIDENT.

WOULD YOU PLEASE JOIN ME IN PLEDGE OF ALLEGIANCE? I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA.

TO THE REPUBLIC FOR WHICH IT STANDS ONE NATION UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FOR ALL.

I KNOW THIS HAS BEEN POSTED THE REQUIRED PERIOD OF TIME.

ARE THERE ANY CONFLICTS TO DISCLOSE? NO, NONE. THANK YOU.

CARLOS, DO WE HAVE ANYBODY THAT SIGNED UP FOR PUBLIC COMMENT? OKAY. THANK YOU. DIRECTORS REPORT.

I'LL BE BRIEF ON MY DIRECTOR'S REPORT BECAUSE WE HAVE A LENGTHY AGENDA.

BUT WHAT'S INTERESTING TO NOTE IS THAT WE HAVE 1406 ADDITIONAL PEOPLE IN THE LABOR FORCE.

SO THAT MEANS THAT OVER THAT LAST YEAR WE'VE CREATED SOME MORE JOBS.

AND SO EVEN THOUGH UNEMPLOYMENT RATE SEEMS TO STAY STEADY, THERE'S MORE GROWTH COMING IN.

SO WE'RE AT $278 MILLION TO DATE IN TOTAL CONSTRUCTION SO FAR.

AND THAT IS REALLY EVEN SURPASSING LAST YEAR'S END OF YEAR TOTALS.

SO VERY GOOD PERFORMANCE THUS FAR IN TERMS OF COMMERCIAL AND RESIDENTIAL GROWTH.

THERE'S NEW CONSTRUCTION IN TERMS OF SUBDIVISIONS AS WELL.

THERE'S 63 UNDER CONSTRUCTION RIGHT NOW WITH OVER 4800 LOTS UNDER DEVELOPMENT.

AND THEN IN REVIEW, WE HAVE 34 NEW SUBDIVISIONS WITH THAT TOTALS, ABOUT 1300 NEW LOTS AND 67 IN PRELIMINARY REVIEW, WHICH IS ANOTHER ALMOST 1600 LOTS.

SO VERY, VERY GOOD RESIDENTIAL GROWTH RATES GOING ON RIGHT NOW.

SOME OF THE UPCOMING CONFERENCES THAT WE WANT TO LET YOU ALL KNOW ABOUT IS TEAM TEXAS ECONOMIC SUMMIT IS TOMORROW THROUGH WEDNESDAY IN ODESSA.

I WILL BE FLYING OUT AT 630 IN THE MORNING TOMORROW MORNING.

CARLOS WILL BE IN AUSTIN FOR THAT ONE AND THEN CAFE CON USA AND CANADA E CANADA IN MONTERREY ON SEPTEMBER 5TH.

CARLOS WILL BE ATTENDING THAT CONFERENCE AND ACTUALLY REPRESENTING US IN THE IN HIS BOOTH.

AND OF COURSE, ON SEPTEMBER 8TH, WE HAVE THE TDC SALES TAX WORKSHOP.

[02:35:02]

TEXAS ECONOMIC DEVELOPMENT COUNCIL HAS NOT HAD ONE OF THESE WORKSHOPS IN THE RIO GRANDE VALLEY IN A LONG TIME, IF EVER.

SO THIS IS AN OPPORTUNITY FOR LOCAL ELECTED OFFICIALS, BOARD MEMBERS AND STAFF TO LEARN A LITTLE BIT MORE ABOUT SOME OF THE NEW LEGISLATIVE REQUIREMENTS AND LEGISLATIVE CHANGES TO THE SALES TAX.

SOME OF THE UPCOMING EVENTS, ASIDE FROM OUR CITY COUNCIL WHERE WE WILL BE PRESENTING, HOPEFULLY THE PROGRAM WILL WORK IN THE BUDGET.

WE HAVE A RIBBON CUTTING COMING UP ON SEPTEMBER 15TH, THEN A JOB FAIR ON SEPTEMBER 14TH AS WELL IN COORDINATION WITH WORKFORCE SOLUTIONS.

AND OF COURSE, THE SOUTH TEXAS INTERNATIONAL FILM FESTIVAL IS BETWEEN THE SEPTEMBER 14TH AND 16TH.

IN OCTOBER. OUR TDC ANNUAL CONFERENCE WILL BE IN HOUSTON.

THOSE OF YOU WHO ARE INTERESTED IN ATTENDING AND LEARNING A LITTLE BIT MORE ABOUT ECONOMIC DEVELOPMENT AND SOME OF THE UPDATES THAT ARE GOING ON, THIS WOULD BE A GOOD CONFERENCE TO ATTEND AS WELL.

AND THEN FINALLY, I JUST WANT TO SAY THAT THE ECONOMIC RIO GRANDE VALLEY PARTNERSHIP ECONOMIC SUMMIT THAT WAS HELD LAST WEEK WAS A VERY BIG SUCCESS.

A LOT OF PUBLICITY, A LOT OF PEOPLE THAT SHOWED UP IN EDINBURG TO HELP US TALK ABOUT REGIONALISM AND UNITY IN TERMS OF ECONOMIC DEVELOPMENT. YEAH, IT WAS A REALLY GOOD EVENT.

THINKING AS A REGION RATHER THAN INDIVIDUAL CITIES.

SET IT FOR THE REPORT.

ANY QUESTIONS OF. ALL RIGHTY.

I KNOW WE'RE GOING TO HAVE QUITE A LONG MEETING TODAY, SO LET'S GET TO APPROVAL OF THE MINUTES.

MADAM PRESIDENT, HI.

WE HAVE COUNCILMAN AND BOARD MEMBER HERE, MR. DAN DIAZ. THANK YOU FOR JOINING US.

CAN WE GET A MOTION TO APPROVE THE MINUTES FOR JULY 12TH AND JULY 25TH? I'LL MAKE A MOTION TO APPROVE.

I GET A SECOND? SO SECOND, ALL IN FAVOR SAY AYE OR RAISE YOUR RIGHT HAND.

OKAY. WE HAVE A VALLEY INITIATIVE PRESENTATION, AND I THINK WE HAVE ALIDA HERE.

IS IT ON? IS IT ON? IT'S KIND OF HARD.

TEST. YES. THERE YOU GO. OKAY.

THANK YOU. SO MY NAME IS AIDA VILLAREAL AND I CURRENTLY SERVE AS CEO OF VALLEY INITIATIVE FOR DEVELOPMENT AND ADVANCEMENT.

AND SO WE'RE VERY THANKFUL FOR THE EDC FOR YOUR SUPPORT THIS YEAR AND A GRANT OF THE 50,000 IN WHICH OUR BENCHMARK WAS TO SERVE 15 RESIDENTS FROM EDINBURG IN YOUR PACKET IS A ONE PAGER PROJECT UPDATE IN WHICH WE ARE SHOWING THAT WE ACTUALLY EXCEEDED THE BENCHMARK AND SERVED 28 EDINBURG RESIDENTS.

AND OUT OF THOSE 28, WE HAVE MAINTAINED A PERSISTENCE RATE OF 100%, WHICH MEANS ALL OF THE STUDENTS HAVE EITHER GRADUATED OR PERSISTED INTO THEIR SECOND YEAR OF EDUCATION. AND SO I'M HERE TODAY REQUESTING YOUR CONSIDERATION FOR AN INVESTMENT FOR NEXT FISCAL YEAR AND THE AMOUNT OF 100,000IN WHICH VIDA WOULD BE MATCHING A $50,000 INVESTMENT FOR A TOTAL PROJECT OF $150,000 TO DOUBLE OUR OUTREACH AND OUR IMPACT TO SERVE AT A MINIMUM 30 EDINBURG RESIDENTS.

AND I'M HAPPY TO ANSWER ANY QUESTIONS OR CONCERNS YOU MAY HAVE.

SO, MEMBERS, I KNOW WE WE HAD ALL HEARD FROM THAT BEFORE ABOUT THE WRAPAROUND SERVICES THAT VIDA PROVIDES.

WE WANTED TO MAKE SURE THAT IT WAS GOING TOWARDS EDINBURG RESIDENTS, WHICH IT WAS, AND THEY EXCEEDED IT.

I KNOW THAT SOME OF THE WORK THAT THEY'RE DOING IS THE KIND OF WORK THAT REALLY KEEPS KIDS IN SCHOOL, BUT ASIDE FROM THAT, REALLY PLACES THEM THEN INTO HIGH PAYING JOBS, WHICH IS CRITICAL.

WE WANT TO GET THEM OUT AND GET THEM IN THE WORKFORCE.

SO I'M GLAD TO SEE THAT THE NUMBERS HAVE INCREASED THE WAY OR AT LEAST THAT YOU DID BEYOND WHAT Y'ALL HAD PROMISED INITIALLY.

[02:40:03]

SO I THINK THERE'S A MATCH ALSO THAT Y'ALL WOULD PROVIDE.

IF WE DO 100,000, YOU'LL MATCH IT WITH 50,000, IS THAT RIGHT? CORRECT. DOES ANYBODY HAVE ANY QUESTIONS FOR MISS ARIEL? I DO. CAN WE GET LIST OF THOSE STUDENTS AND WHERE THEY'RE AT IN TERMS OF WHAT SCHOOL AND OR WHAT THEY'RE DOING? YES, ABSOLUTELY.

AS A MATTER OF FACT, WE DO SEND A QUARTERLY REPORT TO THE EDC, BUT WE CAN ALSO SHARE THAT WITH YOU ALL IF YOU PREFER TO RECEIVE IT AS WELL.

PLEASE. HOW SOON CAN.

BY TOMORROW. YEAH, I KNOW.

IT'S IN THE ONE PAGER.

IT SHOWS THE AREAS THAT THEY'RE STUDYING IN OR THAT.

SO THE STEM FIELDS, THE SPECIALIZED TRADES, SOCIAL SERVICES AND BUSINESS WITH THE LARGEST BEING THE SPECIALIZED TRADES.

SO I PROBABLY THAT PROBABLY MEANS THAT MOST OF THEM ARE EITHER GOING TO STC OR STC AND WELL, ACTUALLY WOULD BE STC IF IT'S LOCAL, RIGHT? YES. BUT YEAH, THAT WOULD HELP TO HAVE THAT.

SO WITH A HIGHER CONTRIBUTION, WE HAD CONTRIBUTED 50,000 ALREADY AND GREAT JOB, BY THE WAY, ON, ON HELPING, YOU KNOW, EXCEEDING WHAT YOU HAD PROMISED WITH BY DOUBLING THE CONTRIBUTION.

IS THERE A CHANCE THAT THESE NUMBERS FROM INCREASE 32, MAYBE A DIFFERENT NUMBER? YES, ABSOLUTELY.

SO I CAN PRETTY MUCH GUARANTEE YOU THAT IF THE BENCHMARK IS 30, THAT WE WOULD OVER EXCEED THAT BENCHMARK AS WELL FOR NEXT YEAR BECAUSE WE'RE ABLE TO BRAID YOUR INVESTMENT WITH OTHER FUNDING SOURCES.

AND JUST RECENTLY, WE WERE AWARDED A $3 MILLION NURSING GRANT FROM THE DEPARTMENT OF LABOR.

SO A LARGE PORTION OF THAT CAN BE LEVERAGED WITH YOUR INVESTMENT TO AGAIN EXCEED THE BENCHMARK AND SERVE MORE RESIDENTS.

SO. AND YOU'VE GOT A I NOTICED YOU ALL HAVE A DATABASE CALLED SOCIAL SOLUTIONS APRICOT.

YEAH, I REALLY LIKE THAT THAT TRACKING SYSTEM BECAUSE I THINK A LOT OF TIMES PEOPLE PLACE THEM AND THEN THEN THEY GET LOST AND THEN YOU DON'T KNOW WHAT HAPPENS TO THE PERSON.

ANY OTHER QUESTIONS? DO Y'ALL WANT TO WAIT FOR US TO GET THE DOCUMENT AND VOTE ON IT FOR THE NEXT MEETING? OKAY. THANK YOU SO MUCH, MISS.

SO WE HAVE CONSIDER ACCEPTING THE EDINBURGH GDC 2022 AUDIT.

AND WE HAVE JOINING US FROM BURTON MCCUMBER AND LONGORIA RICKY LONGORIA.

AND TELL ME YOUR NAME AGAIN.

LUIS GOMEZ LOPEZ.

YEAH, WE HAVE LUIS LOPEZ.

THANK YOU. THANK YOU, MADAM CHAIRMAN.

AGAIN, MY NAME IS RICKY LONGORIA, A MANAGING PARTNER OF THE FIRM OF BMO BURTON AND LONGORIA PRIVILEGED TO ACTUALLY BE ABLE TO SERVE YOU ALL AND SERVING NOT ONLY YOU ALL, BUT THE CITY OF EDINBURG.

THIS IS MR. LUIS LOPEZ. HE IS AN AUDIT MANAGER WITHIN THE FIRM.

HE WAS THE ONE PROBABLY MORE HANDS ON THAN MYSELF IN TRYING TO GET THIS AUDIT TAKEN CARE OF AND AND COMPLETED.

UM, I HAVE THE OPPORTUNITY TO, TO TO SPEAK TO MADAM CHAIRMAN BEFORE THE MEETING SAID, YOU KNOW, RELATIVELY SPEAKING, THIS REPORT SHOULD BE FAIRLY EASY.

THE CHALLENGE I'M HAVING IN TRYING TO PRESENT THIS YOU ALL'S REPORT IS REALLY JUST A NUMBER OF ERRORS THAT WE FOUND IN LAST YEAR'S REPORT THAT HAVE CARRIED INTO THIS YEAR'S REPORT.

AND SO I'M GOING TO TRY NOT TO SPEAK LIKE AN ACCOUNTANT, BUT I'VE BEEN DOING THIS FOR 30 YEARS.

THERE'S GOING TO BE VERY HARD FOR ME TO DO SO.

THANK YOU. AND I HAD MENTIONED TO RICKY THAT WE MAY AT SOME POINT SAY, CAN YOU DUMB IT DOWN A LITTLE BIT FOR US AND LET'S NOT TALK ACCOUNTING PRINCIPLES.

AND YEAH, I PROMISE I WOULD NOT BE OFFENDED.

SO WHAT WAS EMAILED TO YOU AND I'M ASSUMING YOU ALL HAVE AN EMAIL COPY WAS BASICALLY TWO DOCUMENTS.

ONE IS THE ACTUAL REPORT ITSELF AND ONE IS A SMALLER THREE PAGE VERSION OF A DOCUMENT THAT JUST AS A MATTER OF PRACTICE, I'VE GOT KIND OF HAVE TO GO

[02:45:10]

THROUGH THERE. BUT THERE ARE GOING TO BE, YOU KNOW, A HANDFUL OF GOOD POINTS IN THERE THAT I HOPE GET YOU TO START THINKING ABOUT.

HEY, WHAT HOW IS THIS GOING TO AFFECT THE ACTUAL AUDIT REPORT AND THE NUMBERS BEING PRESENTED? SO I'M GOING TO START WITH THE THE SMALLER DOCUMENT, AND IT'S CALLED THE GOVERNANCE LETTER.

I'LL I'LL SPEAK TO IT, THOUGH.

UM, AGAIN, JUST JUST CONFIRMING WHY WE'RE HERE.

WE'RE HERE TO DISCUSS THE AUDIT FOR THE YEAR ENDED SEPTEMBER 30TH, 2022.

ALSO CONFIRMING THAT THAT THE AUDIT, IN TERMS OF THE ROLE THAT WE PLAY IN THIS PROCESS, IS PERFORMED UNDER GOVERNMENT AUDITING STANDARDS.

SO WE ARE HELD TO TO A HIGHER STANDARD IN THAT REGARD.

AND THEN THERE'S A SECTION CALLED SIGNIFICANT AUDIT MATTERS, AND IT SPEAKS TO MANAGEMENT'S RESPONSIBILITY.

A LOT OF FOLKS THINK THAT THE AUDIT REPORT ITSELF IS OURS.

OUR OBJECTIVE IS TO AUDIT THE REPORT, NOT TO NECESSARILY PREPARE THE REPORT.

IN FACT, THE ACTUAL REPORT ITSELF WAS ACTUALLY PREPARED BY CITY STAFF.

CERTAINLY THERE WAS A LOT OF BACK AND FORTH BECAUSE THERE ARE SOME THINGS THAT WE SAW THAT WEREN'T CORRECT.

BUT AT THE END OF THE DAY, IT'S MANAGEMENT'S RESPONSIBILITY.

I WANTED TO MENTION THAT JUST JUST SO YOU KNOW.

YOU KNOW, OUR OUR PROFESSION IS EVOLVING JUST LIKE EVERYBODY'S PROFESSION.

AND THERE'S, YOU KNOW, THERE'S ALWAYS SOMEBODY, NEW YORK THAT THINKS WE'VE GOT TO MAKE IT MORE DIFFICULT THAN IT HAS TO BE.

AND SO IF YOU'VE EVER HAD AN AUTO PRESENTATION THIS PAST YEAR, YOU MAY HAVE NOTICED OR MAYBE THEY MENTIONED ABOUT A NEW LEASE STANDARD ACCOUNTING FOR LEASES, THAT'S A BIG THING.

AND AND NOT ONLY IN THE FOR PROFIT WORLD, BUT THE NONPROFIT WORLD AND GOVERNMENTAL.

BUT JUST TO ACKNOWLEDGE THAT THERE IS A NEW STANDARD IN THIS PARTICULAR YEAR.

THE SILVER LINING IS IN YOUR CASE, IT'S NOT SIGNIFICANT ENOUGH FOR US TO EVEN CONSIDER, BUT WE JUST NEED FOR YOU ALL TO BE AWARE THAT LEASES ARE THERE IS A LEASE STANDARD.

TO THE EXTENT THAT YOU GET INTO SOMETHING IN THE FUTURE THAT IS SIGNIFICANT.

ALSO JUST ACKNOWLEDGING THAT AS MUCH AS IN EVERY AUDIT REPORT AND EVERY ACCOUNTING DEBITS EQUAL CREDITS.

AND SO THAT SEEMS LIKE A SCIENCE THEY SHOULD ALWAYS AGREE.

THERE ARE ESTIMATES ASSOCIATED WITH SOME OF YOUR NUMBERS.

AND SO LET'S TALK ABOUT THE BIGGER ESTIMATES IN ANY AUTO REPORT AND REALLY SPECIFICALLY AS IT PERTAINS TO YOUR AUDIT REPORT.

ONE IS MANAGEMENT'S ESTIMATE OF THE COLLECTIBILITY OF NOTES RECEIVABLE WITH YOUR BIGGEST NOTES RECEIVABLE BEING THE SANTANA TEXTILES RECEIVABLE.

BUT JUST DON'T FORGET THAT THE FOOTNOTES.

OKAY. I WANT TO TURN THE PAGE AND I'M GOING TO TALK TO THE FIRST POINT THAT'S ON THERE.

AND IT SAYS DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT.

SO IT'S NOT IT'S NOT A GOOD PRACTICE TO HAVE A SEPTEMBER 30TH, 2022 AUDIT REPORT PRESENTED TO YOU IN AUGUST.

I THINK, GENERALLY SPEAKING, YOU DON'T HAVE TO BE AN ACCOUNTANT, YOU KNOW, YOU KNOW, TO TO TO KNOW THAT.

AND FOR THOSE THAT ARE NOT FAMILIAR WITH AUDIT PROCESS, SOMETIMES, YOU KNOW, IT'S THE AUDITOR'S FAULT, YOU KNOW.

WELL, THEY DIDN'T GET THEY DIDN'T GET THE OPPORTUNITY TO TO THEY DIDN'T THEY DIDN'T THEY DIDN'T DO THEIR JOB.

MANAGEMENT WAS UNABLE TO PROVIDE A TRIAL BALANCE TO US UNTIL APRIL 14TH, 2023.

WHY ARE WE WHY ARE WE STILL TALKING ABOUT THIS IN AUGUST? WELL, ONCE WE GOT THE TRIAL BALANCE, WE STILL NEEDED INFORMATION TO AUDIT, RIGHT? WE ONLY AUDIT WHAT THE CITY CAN PROVIDE.

AND IT TOOK THAT LONG IN ORDER FOR US TO BE ABLE TO COMPLETE THE AUDIT.

AND SO, FOR EXAMPLE, I MENTIONED AND I JUST THIS IS AN EXAMPLE I MENTIONED THE CITY'S RESPONSIBLE FOR PREPARING THE AUDIT.

THEY THEY SENT US A DRAFT, THEIR FIRST ITERATION OF THE DRAFT ABOUT FOUR WEEKS AGO.

[02:50:02]

AND ADMITTEDLY, I THINK THEY WOULD AGREE IT WAS NOT IN GOOD SHAPE.

AND SO WE SENT THEM BACK ALMOST AN ENTIRE NEW REPORT AND JUST TOOK THEM THAT LONG TO GET US SOMETHING THAT WE COULD WORK WITH.

THAT'S A NORMAL PART OF THE PROCESS, BUT IT'S NOT NORMAL TO BE HERE DURING THIS TIME.

AND SO I JUST WANTED TO TO ACKNOWLEDGE THAT AND KNOW THAT WE AS SERVICE PROVIDERS ARE ALWAYS INTERESTED IN MAKING SURE THAT YOU GET SOMETHING TIMELY.

OKAY. DOES ANYBODY HAVE A QUESTION ABOUT THAT POINT? JUST FOR CLARITY AND FOR US ON THE BOARD.

SO LAST YEAR DURING THAT TIME THAT YOU NOTED, WE WERE PAYING THE CITY.

FOR THIS FOR AUDITING AND ACCOUNTING, IS THAT CORRECT? YES. SO SO WE WERE WE WERE PAYING THE CITY.

AND YOU FAILED TO GET THE PROPER INFORMATION THAT YOU NEEDED.

OBVIOUSLY, IF YOU'RE GETTING IT IN APRIL OR FOUR WEEKS AGO, WE'RE DELAYED SO THAT WE KNOW THAT.

YES. AND WHAT WHAT CONVERSATIONS DO WE HAVE WITH WITH WITH CITY ACCOUNTING STAFF OR WHAT HAVE YOU? WELL, THEY WERE ALSO CONDUCTING THE CITY AUDIT AT THE SAME TIME.

WELL, THAT'S A WHOLE DIFFERENT.

I'M MORE CONCERNED ABOUT THE EDC AUDIT BECAUSE THAT'S WHAT WE'RE PAYING FOR.

RIGHT. NOT NOT THE CITY AUDIT.

WELL, THEY WERE AWARE THAT WE WANTED THE AUDIT DONE.

BUT WE PAID FULL I MEAN, WE PAID OUR WE PAID FEES.

RIGHT. YES. ALL RIGHT.

YEAH, WE HAVE PAID.

WE HAVE NOT GOTTEN A FULL ACCOUNTING OF THE BALANCE SHEETS AND PROFIT AND LOSS STATEMENTS.

WE'VE BEEN CREATING IT ON OUR OWN FROM THE SOFTWARE PROGRAMS THAT'S OUT THERE.

YOU'RE BASICALLY GETTING ALL THE RAW DATA AND THEN HAVING TO PUT TOGETHER SOMETHING.

OKAY. YES. THANK YOU.

AND THE REASON WHY I BRING IT UP, WE JUST HAD A $100,000 REQUEST FROM SOME.

WE DON'T EVEN KNOW IF WE EVEN HAVE THAT.

AND OBVIOUSLY. MR..

LONGORIA BUT YOU'RE NOT.

THAT'S CONCERNING.

YEAH. I MEAN, YOU KNOW, IT'S UNFORTUNATE THAT, YOU KNOW.

I'M AN ACCOUNTANT, BUT I'M ALSO A HISTORIAN, RIGHT? BECAUSE EVERYTHING WE DEAL WITH IS IN THE PAST.

BUT YOU'VE GOT TO.

YEAH. HISTORY IS IMPORTANT TO YOU ALL.

BUT YOU ARE MAKING DECISIONS TODAY, RIGHT? YOU KNOW, SPENDING $100,000 IS NOT AN INSIGNIFICANT AMOUNT.

SO I, LIKE YOU, WOULD WANT TO HAVE KNOWLEDGE AS TO WHERE WE AT TODAY.

YEAH, THIS IS IMPORTANT.

AND YES, YOU HAVE TO HAVE IT DONE AND THINGS OF THAT NATURE.

BUT THE BEST INFORMATION FOR YOU ALL TO MAKE DECISIONS ON IS REALLY THE MOST CURRENT INFORMATION TODAY.

AND IF IT'S NOT BEING PRESENTED AND THAT'S SOMETHING OBVIOUSLY IT NEEDS TO BE ADDRESSED.

SO. SO. SO THE NEXT PART TALKS ABOUT CORRECTED AND UNCORRECTED MISSTATEMENTS.

AND HERE'S WHERE I CAN GET SPEAKING LIKE LIKE AN ACCOUNTANT.

SO I JUST WANT YOU JUST TO CONCEPTUALIZE THIS CONCEPT.

OKAY. AND LOOKING AT LAST YEAR'S REPORT.

OKAY. THERE WAS APPROXIMATELY 17 TO $18 MILLION WORTH OF ERRORS IN THAT REPORT IN TERMS OF THINGS THAT ARE BEING PRESENTED. OKAY.

AND THAT'S NOT A GOOD THING.

I'M GOING TO GIVE YOU THE SILVER LINING HERE IN A MINUTE.

RIGHT. BUT THAT'S NOT A GOOD THING.

OKAY. SO SO THAT SPEAKS TO THAT DETAIL.

I'M NOT GOING TO GO INTO THE COUNTY SPEAK, BUT JUST CONCEPTUALLY, BECAUSE I WANT TO WALK YOU THROUGH WHERE THOSE ERRORS LIE.

OKAY. A DISAGREEMENTS WITH MANAGEMENT, AS CHALLENGING AS IT WAS.

WE HAVE REALLY, YOU KNOW, TRYING TO TO CONDUCT THIS AUDIT.

AND, YOU KNOW, OBVIOUSLY THE CITY'S AUDIT SINCE DECEMBER OF 2022.

WE HAVE MET WEEKLY WITH STAFF TRYING TO GET THIS OUT.

AND SO CERTAINLY FROM OUR SPIRIT, I THINK THAT ACTION INTO ITSELF SPEAKS FOR ITSELF AND TRY AND PROVIDE THE LEVEL OF SERVICE WE BELIEVE YOU DESERVE.

BUT AT THE END OF THE DAY, IN THAT PROCESS, YOU KNOW, THERE WAS NO INFIGHTING, IF YOU WILL.

AND I JUST WANT TO CONFIRM THAT.

REALLY? THAT'S ALL I REALLY WANTED TO COVER ON THIS LETTER.

THERE'S OTHER THINGS IN THIS LETTER THAT MAY CATCH YOUR EYE.

THE PHONE CALL. YEAH. SO SO WHAT WHAT WE'VE LEARNED IS THAT THE BEST KIND OF COMMUNICATION, IF IT'S NOT GOING TO BE ONE ON ONE, IT'S GOT TO BE VIA ZOOM.

OKAY. THAT'S THE WORLD WE LIVE IN.

SO EVERY FRIDAY AND THEY SET THE DAY AND TIME, NOT US.

EVERY FRIDAY SINCE DECEMBER, WE'VE HAD A STANDING 3:00 PM CALL WITH CITY STAFF TO FIND OUT WHERE YOU'RE AT.

OKAY, TALK ABOUT WHAT'S THE PROGRESS WHERE WE'RE AT.

BECAUSE IF YOU CAN IMAGINE, WHEN WE WERE ENGAGED, WE I MEAN, WE HAVE HUMAN RESOURCES, BUT WE CAN'T BE ON CALL OURSELVES.

[02:55:07]

RIGHT? AND SO OUR TIME FOR THIS AUDIT WAS ACTUALLY SCHEDULED BACK IN THE SPRING BECAUSE THAT WAS WHEN WE AGREED TO DELIVER THE AUDIT AND BEING ABLE TO DO SO.

SO THAT PUTS US, YOU KNOW, IN AN ON CALL POSITION.

AND SO HAVING THOSE WEEKLY MEETINGS ALSO TELLS ALLOWS US TO TO SCHEDULE STAFF, OKAY.

THEY'RE FURTHER AHEAD THAN WE THINK THEY ARE AND THINGS OF THAT NATURE.

THERE ARE ALWAYS, I WANT TO SAY FACE TO FACE, BUT IN THIS WORLD, ZOOM IS ALMOST FACE TO FACE.

OKAY. WE ALSO HAVE JUST SO YOU KNOW, WE HAVE SYSTEMS IN PLACE THAT TRACK OUR REQUEST AND THEIR SUBMISSIONS.

SO I COULD PRINT YOUR REPORT THAT SHOWS, HEY, WE WE ASKED FOR THIS BACK IN.

I'M TOTALLY MAKING UP A DATE ON JANUARY 15TH AND THE SYSTEM WILL SHOW YOU.

WE GOT IT IN JUNE 15TH.

RIGHT. SO THERE'S NO QUESTION, NO FINGER POINTING ABOUT, HEY, YOU KNOW, I GAVE IT TO YOU.

YOU LOST IT. NO.

WE HAVE SYSTEMS IN PLACE TO ENSURE THAT EVERYBODY'S ACCOUNTABLE FOR THE ENTIRE PROCESS.

CAN YOU CLARIFY IN TERMS OF MR..

LONGORIA, YOU SAID YOU WERE MEETING WITH STAFF.

OBVIOUSLY, YOU'RE AUDITING THE EDC DEPARTMENT, CORRECT? THAT INCLUDE EDC STAFF IN THOSE? YEAH. SO SO SO THE ACCOUNTING STAFF THAT'S ASSIGNED TO YOU ALL THE SAME ACCOUNTING STAFF AS TO THE CITY.

SO THAT ONE MEETING INCORPORATED BOTH TOPICS.

UH, WELL INCORPORATED BOTH TOPICS, BUT INCLUDED STAFF FROM BOTH ENTITIES.

YEAH. SO AGAIN, THE ACCOUNTING STAFF IS THE SAME.

YEAH, RIGHT. BUT OUR STAFF, EDC STAFF.

YEAH. WELL, AGAIN, BECAUSE WE DON'T HAVE AN ACCOUNTING DEPARTMENT, SO TO SPEAK.

WELL YEAH, YEAH. LET ME WAS THERE IN OUR.

OKAY, THAT'S, THAT'S WHAT YOU'RE REFERRING TO STAFF CORRECT.

YEAH LET THE NOW WORKS FOR THE EDC BUT DIDN'T THEN.

RIGHT AND TO AND TO BE HONEST WITH YOU WHEN IT COMES TO THE YOU KNOW THE DETAILS OF THE AUDIT I'M GOING TO CALL IT, YOU KNOW, THE NUTS AND BOLTS OF THE AUDIT THAT'S USUALLY DONE BY THE PEOPLE WHO HANDLE THE BOOKS.

RIGHT. YOU KNOW, TRYING TO FIGURE OUT I NEED RECONCILIATION, I NEED THIS.

SO THAT'S WHY IT WAS THOSE FOLKS.

I THINK I THINK HE'S REFERRING TO FINANCE.

YOU'RE TALKING ABOUT FINANCE DEPARTMENT? YES. YES. THE REASON WHY I POSED THE QUESTION THAT THERE IS A DOCUMENT YOU NEEDED OR WHAT HAVE YOU, WOULD YOU PAY? YOU KNOW. THIS STACK WITH A I CAN GET YOU THAT VERSUS FINANCE DEPARTMENT BECAUSE WE MAY MAYBE WE SPENT IT, WE DONATED IT.

WE DID SOMETHING. YEAH, WE COULD HAVE HELPED YOU ALONG THAT PROCESS.

YEAH. SO SO WHEN WE WERE ENGAGED, YOU KNOW, THERE WAS ONE CITY FINANCE DIRECTOR, THEN YOU HAD AN INTERIM CITY FINANCE DIRECTOR AND THEN YOU HAD AND IN THOSE INSTRUCTIONS WE WERE INSTRUCTED THE MOST EFFICIENT WAY WOULD BE TO GO THROUGH THEM BECAUSE THEY'RE THE ONES, THEY'RE THE ONES MAINTAINING THE BOOKS AND RECORDS IF THERE'S A MORE EFFICIENT WAY.

AND IF YOU SUGGEST, HEY, NEXT YEAR, YOU KNOW, DO X, OF COURSE WE'LL CONSIDER THAT IN THE PROCESS.

THAT MESSAGE GETS DIRECTLY TO EDC STAFF TO PULL SOMETHING OR IF IT'S JUST COMING FROM FINANCE DEPARTMENT OF THE CITY.

THANK YOU. BASED ON.

I GUESS INSIGHT IS NOT NECESSARILY SOMETHING THAT THE ED STAFF WOULD ACTUALLY NEED TO PROVIDE BECAUSE ALL THOSE DOCUMENTS ARE MAINTAINED AT THE FINANCE DEPARTMENT.

AND SO IT WOULD BE THE FINANCE DEPARTMENT THAT WOULD NEED TO.

I THINK IT'S MORE FROM A COMMUNICATION PERSPECTIVE.

WE'RE SITTING, YOU KNOW, AND HERE WE ARE TRYING TO MAKE THINGS HAPPEN AND WE MIGHT NOT EVEN HAVE THE MONEY FOR IT.

SO SO, YEAH, IT'S, IT'S IMPORTANT THAT WE FIND OUT EARLIER.

ANY OTHER QUESTIONS ON THIS PART? OKAY. MOVING ON THEN LET'S LET'S LET'S JUMP OVER TO THE FINANCIAL STATEMENTS THEMSELVES.

SO I'M GOING TO JUMP TO PAGE ONE, WHICH IS.

OUR LETTERHEAD. OKAY.

OF COURSE THEY HAVE BEEN ADJUSTED TO TO THE TO WHERE WHERE WE FEEL COMFORTABLE RENDERING AN OPINION.

AND SO SO WE HAVE RENDERED RENDERED AN OPINION WHICH IS CONSIDERED AN UNMODIFIED OPINION.

AND THAT'S THAT'S AUDITING SPEAK NON AUDITING SPEAK WOULD BE IT'S A CLEAN OPINION.

[03:00:01]

OKAY BUT WHAT ENTIRETY DOES THAT MEAN IT ALL? IT DOESN'T MEAN THAT EVERY SINGLE NUMBER IS RIGHT OR ANYTHING LIKE THAT OR THAT WE EVEN LOOKED AT IT EVERY SINGLE TRANSACTION BECAUSE THAT'S NOT THE WAY AN AUDIT IS CONDUCTED.

WHAT IT DOES MEAN TO SAY IS THAT THE NUMBERS THAT ARE BEING PRESENTED AND WE'RE GOING TO GO THROUGH THIS NUMBERS ARE FAIRLY PRESENTED IN ALL MATERIAL RESPECTS.

NOT AN EXACT NOT EVERY EXACT NUMBER.

IMAGINE IF WE HAD AN AUDIT, EVERY EVERY SINGLE TRANSACTION, WE'D STILL BE AUDITING MAYBE.

BUT BASED UPON OUR TESTS PERFORMED ACCORDING TO THE STANDARDS, WE ARE RENDERING AN UNMODIFIED I.E.

CLEAN OPINION ON THESE NUMBERS FOR THE EDC.

OKAY THERE. I WILL SAY THAT THERE IS ONE ONE PARAGRAPH IN HERE THAT'S CALLED AN EMPHASIS OF MATTER PARAGRAPH.

OKAY. NOW THAT THAT'S A LITTLE DIFFERENT THAN YOU MAY SEE IN SOME OF THE OTHER REPORT.

AGAIN, JUST REMINDING THE READER.

ABOUT THAT NOTE RECEIVABLE FROM FROM SANTANA TEXTILES THAT IF YOU DON'T COLLECT IT RIGHT NOW, IT'S SITTING ABOUT 13% OF YOUR TOTAL ASSETS.

AND SO JUST HIGHLIGHTING HEY HEY, READER, AS YOU GO THROUGH THIS, JUST REMEMBER THIS NUMBER.

SO THAT TYPE OF DISCLOSURE IS ACTUALLY SIMILAR TO WHAT YOU'VE HAD IN THE PAST.

SO THAT SHOULD NOT BE UNUSUAL FOR THOSE WHO HAVE BEEN HERE FOR A BIT.

YES. THANK YOU. WE'RE ALL TOO FAMILIAR WITH THAT DEBT.

OKAY. OKAY, SO PAGE THREE.

PAGE THREE, FOUR, FIVE AND SIX, SEVEN.

OKAY. AND HERE'S.

I'M NOT GOING TO ASSUME ANYTHING WHEN I SAY THIS.

SO JUST IF I. OKAY.

SO THE FINANCIAL STATEMENTS FOR THE EDC ARE PRESENTED UNDER A STANDARD CALLED GOVERNMENT AUDITING STANDARDS.

THERE ARE DIFFERENT STANDARDS FOR WHICH FINANCIAL STATEMENTS CAN BE PRESENTED EXCEPT THAT ACCEPT EXCEPT THAT THAT FOR US GOVERNMENT AUDITING STANDARDS.

AND SO THAT REQUIRES A PRESENTATION OF TWO STATEMENTS.

OKAY. ONE IS CALLED THE STATEMENT OF NET POSITION AND ONE IS CALLED A BALANCE SHEET.

OKAY. PAGE TEN IS YOUR STATEMENT OF NET POSITION.

OKAY. AND YOU'LL SEE AT THE VERY BOTTOM OF YOUR BOTTOM LINE DRIVEN TOTAL NET POSITION OF 17,000,340.

$17,340,000. OKAY.

AND THE NUMBER I WANT YOU TO TO SEE, BECAUSE IT WASN'T LIKE THIS LAST YEAR, WAS THAT UNRESTRICTED BALANCE OF 9,000,668 881.

OKAY. IF YOU'RE LOOKING AT NET POSITION AND YOU CAN EQUATE IT TO EQUITY OR WHATEVER THINGS OF THAT NATURE, YOU DON'T NECESSARILY WANT TO SEE A NEGATIVE NUMBER THERE.

RIGHT? NORMALLY, YOU WOULD THINK THAT THAT'S THAT'S NOT A GOOD THING.

OKAY. IN YOU ALL'S CASE, IT IS UNDERSTANDABLE IN WHAT I MEAN BY THAT IS THINK ABOUT.

THE TRANSACTIONS THAT YOU ALL ARE HAVING SPECIFICALLY AS IT RELATES TO THE CITY.

RIGHT. AND I'M GOING TO USE A TOOL AS AN EXAMPLE.

MY GRANDMOTHER USED TO LIVE BY A DUELIST.

SO THAT'S THE ONE THAT THAT THAT RINGS TRUE TO ME.

OKAY. SO SO ANYTIME YOU ENTER INTO A TRANSACTION.

RIGHT NOW, THE CITY WHEREBY YOU'RE BUILDING, CONSTRUCTING SOMETHING FOR THE FOR THE INTENDED PURPOSE, THAT ONCE THAT ASSET IS COMPLETE, THAT YOU WILL TURN OVER THAT ASSET FOR SOMEBODY TO MAINTAIN.

IT'S THEIR DEAL.

OKAY. WELL.

WELL, YOU NO LONGER HAVE THAT ASSET.

SO YOU EXPENDED CASH OR INCURRED DEBT, RIGHT, TO BUILD THAT ASSET.

BUT THEN AT THE END OF THE PROJECT YOU JUST GET RID OF IT.

SO YOU'RE LEFT AND IF IT WAS DEBT, YOU'RE LEFT WITH A DEBT AND NO ASSET.

AND SO WHAT THAT DOES IS IT CREATES A NEGATIVE EQUITY LIKE IT DOES THAT NUMBER.

OKAY. IT IS NOT UNUSUAL.

OKAY. SO I WANT YOU TO IT IS NOT UNUSUAL.

WE'VE SEEN IT. OKAY? BECAUSE THAT'S THAT'S THE WAY ACCOUNTING WORKS.

IF YOU GIVE IF YOU BUILD AN ASSET AND YOU TURN IT OVER AND YOU'RE LEFT WITH DEBT, OF COURSE YOU'RE GOING TO HAVE NEGATIVE EQUITY.

SO I WANT TO I WANT TO POINT THAT OUT.

I ALSO WANT TO POINT OUT THAT IN DEVELOPING THIS STATEMENT.

THERE IS APPROXIMATELY $18 MILLION WORTH OF CORRECTIONS FLOWING THROUGH HERE.

OKAY. LET ME GIVE YOU THE CRUX OF THE BIGGEST ONE.

OKAY. THERE WERE SOME REFUNDED DEBT.

[03:05:02]

THAT IS A 2015 DEBT THAT WAS REFUNDED.

AND IN LAST YEAR'S AUDIT REPORT WHERE THE AUDITOR EXPRESSED AN UNMODIFIED OPINION, OKAY, THAT DEBT WAS GONE, THAT DEBT WAS PUT IN PROCEEDS, IT WAS REFUNDED AND MONEYS WERE PUT IN ESCROW FOR A THIRD PARTY TO SERVICE THE DEBT, ETCETERA, ETCETERA, THE WAY THEY WORK.

THE ESCROW BALANCE AND THE DEBT BALANCE WERE NEVER TAKEN OFF THESE FINANCIAL STATEMENTS.

OKAY. SO YOU MENTIONED CASH, RIGHT? WELL, ESCROW MONEY WOULD HAVE BEEN RESTRICTED TO BEGIN WITH, SO YOU COULDN'T HAVE USED IT.

BUT MY POINT IS, IF YOU SAW CASH LAST YEAR, YOU WOULD HAVE SEEN THIS HIGH LEVEL OF CASH THAT YOU DIDN'T REALLY HAVE.

AT THE SAME TIME, YOU WOULD HAVE HAD THIS HIGH LEVEL OF DEBT THAT YOU DIDN'T HAVE.

OKAY. THAT'S THAT'S THE BIGGEST ERROR THAT THAT FLOWED THROUGH HERE.

UH, AND THOSE WERE BONDS THAT WERE ISSUED BACK IN 2015 WERE REFUNDED BOND 2015 REFUNDED BONDS THAT THAT EVEN THOUGH YOU REFUNDED THEM REFUNDED BY DEFINITION YOU YOU'VE GONE AND YOU PLACED THEM IN ESCROW FOR SOME AND THEY'RE KIND OF OFF YOUR BOOKS RIGHT AND SO THAT DEBT STILL STAYED ON THE BOOKS AND SO THAT DEBT IS NO LONGER PRESENTED HERE.

IT'S 2022 WHERE THE TRANSACTION WAS MADE OR WAS IT WHEN IN THIS HISTORY WAS THAT DONE? WELL, I THINK WE NOTICED IN 2010.

DO YOU REMEMBER WHEN IT WAS 20, 21? IT WAS 2021.

YEAH. SO THE AUDIT FOR THAT TURNED INTO 2022 WAS FOR 2021.

YEAH, THAT'S. YEAH.

SO. SO I'M SORRY.

GO AHEAD. OH, AND SO AND THERE'S OTHER THINGS THAT ARE GOING ON PAGE.

I ACTUALLY READ THIS, BUT I THINK IT'S ON PAGE 31 WHERE IT KIND OF GOES THROUGH THE ADJUSTMENTS.

RIGHT. OKAY. AND IT KIND OF RECONCILES.

WHERE ARE THESE NUMBERS FROM? THERE ARE SOME OTHER ADJUSTMENTS IN THEIR RECONCILIATION.

TALK ABOUT, HEY, SANTANA WASN'T PROPERLY ALLOWED.

SO WE GOT PAST ALL THAT.

AND SO SO NOW WE'RE LEFT WITH THIS.

I WILL SAY, JUST AS AN ASIDE, YOU KNOW, THERE WAS A DISCUSSION ABOUT.

LASHES REPORT IS LIKE MATERIALLY MISSTATED.

RIGHT? YOU KNOW, YOU GO BACK AND CORRECT THE PERMANENT RECORD.

RIGHT. TO MAKE IT TO TO MAKE IT RIGHT.

BECAUSE IT IS IF SOMEBODY DIDN'T KNOW THIS AND JUST PULLED THAT REPORT, THEY'D SIT THERE AND REACH A DIFFERENT CONCLUSION.

RIGHT. THERE WAS A DISCUSSION.

AND AT THE END OF THE DAY, IT WAS ABOUT CONSIDERING WHERE WE ARE TODAY WITH THIS REPORT, LET'S JUST MOVE FORWARD.

AND SO OBVIOUSLY, THAT'S UP TO YOU ALL TO DECIDE.

BUT BUT THAT'S WHAT HAPPENING.

THAT'S WHAT'S HAPPENING WITH THESE STATEMENTS.

OKAY. DOES THAT MAKE SENSE? GIVE YOU A BIG PICTURE ON THIS ONE.

OKAY. SO I'M GOING TO ASK YOU TO TURN TO PAGE 12.

SO. SO HERE'S MORE OF THE SILVER LINING PART OF IT.

OKAY. AS YOU MENTIONED ON PAGE 13, I'M SORRY, PAGE 31, IT GOES THROUGH THERE AND IT RECONCILES THESE DIFFERENCES.

AND YES, THOSE STILL IMPACT THIS PARTICULAR STATEMENT.

BUT IN A NORMAL INSTANCE, JUST IN JUST IN THE INTEREST OF TIME AND PRESENTING AN AUDIT REPORT, I WOULD TELL YOU THIS.

I WON'T TELL YOU IF YOU DON'T UNDERSTAND ANYTHING ABOUT AN AUTO REPORT SUCH AS THIS.

OKAY. UNDERSTAND ONE NUMBER.

OKAY. AND THAT IS WHAT YOU HAVE IN YOUR UNASSIGNED GENERAL FUND.

IF YOU DON'T UNDERSTAND ANYTHING ELSE, UNDERSTAND THAT NUMBER.

OKAY. TOO LOW.

IT GETS YOU IN TROUBLE. TOO HIGH.

YOU START WONDERING WHETHER, HEY, ARE WE DOING THE KIND OF THINGS WE'RE SUPPOSED TO BE DOING BECAUSE YOU'RE STARTING TO STARTING TO INCREASE, RIGHT? THESE ADJUSTMENTS DID NOT AFFECT THAT NUMBER.

SO IF I LOOK AT UNASSIGNED BALANCE OF 10.270, ALL OF THESE THINGS I'M TALKING ABOUT DID NOT AFFECT THAT NUMBER.

SO IF YOU WERE MAKING DECISIONS BASED UPON THAT NUMBER, THEN YOU WOULD HAVE BEEN OKAY.

I HAD A NOTE TO MYSELF.

THIS IS WHAT WE CAN SPEND QUESTION MARK.

IS THAT OKAY? WELL, IT'S NOT NECESSARILY SPIN, BUT I MEAN, I'M NOT SAYING IT'S A CASH I'M NOT SAYING IT'S NOT A GOOD WAY TO CATEGORIZE IT.

BUT IS THAT WHAT WE HAVE? YOU KNOW? THOSE WHO SIT ON THE BOARD.

YOU KNOW, WHEN YOU LOOK AT UNASSIGNED FUND BALANCE, THERE'S ALWAYS A METRIC, RIGHT? LIKE WHAT'S THE RIGHT NUMBER, RIGHT.

IF I JUST SAID HAVING TOO LITTLE IS NOT A GOOD THING AND HAVING TOO MUCH IS PROBABLY NOT A GOOD THING TOO.

LIKE, WHAT'S THE RIGHT NUMBER? THERE'S A NUMBER OF DIFFERENT METRICS.

I'LL SAY, LOOK, IF YOU GOT.

A TYPICAL METRIC WOULD BE, HEY, 60 DAYS OR 90 DAYS OF UNASSIGNED FAMILY MAY HAVE HEARD THAT BEFORE, RIGHT? YEAH. OKAY. WE WIN SIX MONTHS.

WELL, IF YOU LOOK IF YOU LOOK AT THIS REPORT AND THIS IS THE SILVER LINING.

SO IF YOU GO TO PAGE 14.

[03:10:05]

OKAY. AND IF YOU CAN FOCUS YOURSELF TO THE MIDDLE OF THE PAGE AND LOOK AT TOTAL EXPENDITURES.

EXPENDITURES TO INCLUDE PRINCIPAL AND DEBT AND CAPITAL OUTLAY.

OKAY, THAT NUMBER IS $9.5 MILLION.

ALL RIGHT. THE METRIC THAT I REFER TO IS ALWAYS, WELL, IF THE GOVERNMENT SHUT OUT TODAY, HOW LONG COULD WE LAST? I SAID 60.

I SAID 90.

SOME SAY 20% OF EXPENDITURES.

YOU'RE CLOSE TO A YEAR.

OKAY. AGAIN, SOMETIMES THE LITTLE IS BAD, BUT SOMETIMES TOO MUCH IS BAD.

THAT'S WHERE YOU ALL TO DECIDE.

RIGHT. IF YOU HAVE TOO MUCH, THE ARGUMENT CAN BE MADE, WELL, YOU'RE NOT MOVING.

YOU'RE DOING THE KIND OF THINGS THAT YOU'RE EXPECTED TO DO QUICKER AND FAST ENOUGH, RIGHT.

THAT'S JUST A COMMENT, BUT IT'S AT THE PACE THAT YOU FEEL COMFORTABLE WITH.

SO FROM THAT STANDPOINT, AND IF YOU LOOK AT FINANCIAL HEALTH BASED UPON THAT NUMBER, THEN YOU ALL ARE PRETTY, PRETTY SOLID.

OKAY. AND TO ME, THAT'S THE IMPORTANT STORY AS IT RELATES TO THIS STATEMENT.

DOES ANYBODY HAVE A QUESTION ON THIS STATEMENT? COULD YOU SAY THAT STATEMENT A LITTLE MORE BOLDLY? NO MATTER THE ERRORS.

YEAH. SO I'M GLAD YOU YOU MENTIONED THAT BECAUSE MY MY QUESTION ON THAT TYPE OF ERROR IS, DOES THAT DID THAT AFFECT IN ANY WAY THE EDC'S ABILITY TO FUND AND.

PROVIDE MONIES FOR ALL THE PROGRAMS THAT WE HAVE SINCE THEN.

AND DID THAT IN ANY WAY AFFECT ITS NO CAPACITIES? NO, NO. YOU KNOW, WHERE WHERE THE ERRORS BECOME IMPORTANT BECAUSE I JUST SAID IF YOU KNOW, IF YOU'RE IF I'M SITTING IN YOUR CHAIR AND IF I'M NOT AN ACCOUNTANT AND I SAY, HEY, IF YOU DON'T KNOW ANYTHING ELSE ABOUT COUNTING, JUST FOCUS ON THIS ONE NUMBER.

THE PART ON FRONT THAT I JUST ALLUDED TO AND TALKED ABOUT, AND NOW YOU GOT THIS ALL THIS STUFF GOING ON.

IT'S REALLY FOR A THIRD PARTY REASON, RIGHT? SO ANYBODY THAT'S GOING TO ISSUE GIVE US GIVE YOU THAT WILL THEY WILL ASK ABOUT THAT NUMBER, RIGHT.

BECAUSE ANY MONEY THAT WE DIDN'T HAVE TO SPEND.

BUT FOR YOU ALL'S PURPOSES.

YES, THAT'S IMPORTANT.

YOU CAN'T LOSE SIGHT OF IT.

YOU CAN'T YOU KNOW, I DON'T WANT TO MINIMIZE, BUT I'M I'M ALWAYS SAY, YEAH, UNASSIGNED, UNASSIGNED UNASSIGNED.

AND HERE YOU'VE GOT ALMOST A YEAR WORTH WORTH OF.

IMAGINE IF THE CITY HAD A YEAR'S WORTH OF EXCESS.

I MEAN. OH MY GOSH. RIGHT.

THAT NUMBER IS IMPORTANT TO ME BECAUSE I KNEW I HAD HEARD IT BEFORE AND I THINK I BROUGHT IT UP AT A CITY MEETING.

HEY, DON'T WE HAVE IT CLOSE TO A YEAR OF.

AND THEY'RE LIKE, YEA, NO WAY.

BUT IT WAS IT WAS THE EDC THAT WE HAD A YEAR.

WE HAD A YEAR THAT WAS PLANNED.

BUT YEAH, YOU KNOW, AND I THINK THAT'S FROM, FROM MY VIEWPOINT, THAT'S WHY.

IT'S GOOD WHEN WE HAVE DIFFERENT EYES, DIFFERENT CONTRACTS, DIFFERENT PEOPLE THAT GET HIRED BECAUSE YOU NEED DIFFERENT EYES INSTEAD OF THE SAME.

THE SAME PEOPLE LOOKING AT THE NUMBERS.

AND I WILL SAY, YOU KNOW, WE'VE LEARNED A LOT IN THE PAST YEAR WITH NEW FINANCIAL ADVISORS, NEW FINANCE PERSONNEL, NEW AUDITORS. AND SO THANK YOU FOR ALL YOUR WORK AND EXPLAINING IT ALL.

I CAN'T SPEAK FOR WHAT'S WHAT CITY STAFF IS DOING WITH RESPECT TO EDC AND THIS YEAR.

RIGHT. I WILL TELL YOU THAT OUR FOCUS WITH THEM IS LET'S GET THE CITY OUT.

BUT ALL OF US HAVE HAVE ACKNOWLEDGED, YOU KNOW, THIS IS AS SOON AS WE'RE DONE HERE.

WELL, GUESS WHAT? WE'RE STARTING.

WE'RE GOING TO START AGAIN.

YOU KNOW. CORRECT? CORRECT.

AND THAT HAD A LOT OF SCHEDULING AND FEES.

BUT AT THE END OF THE DAY, IT DOESN'T JUST NEED TO BE DONE.

IT NEEDS TO BE DONE RIGHT.

THAT'S ALWAYS BEEN OUR PHILOSOPHY.

SO. AND SO THE QUESTION I HAVE IS WHEN THERE'S DELAYS LIKE THAT, YOU CAN BE REQUESTING INFORMATION FROM STAFF DAY TO DAY CURRENT OBLIGATIONS, AT LEAST TO KEEP SOME SORT OF WORK GOING INSTEAD OF WAITING FOR REPORTS FROM OBVIOUSLY DELAYED REPORTS FROM FROM FINANCE STAFF THAT THAT IS HAVING ISSUES.

YOU CAN BUT IT BECOMES, YOU KNOW, MAYBE A PHILOSOPHICAL DISCUSSION BECAUSE YOU GET THEM.

THERE'S ONLY SO MANY HOURS IN A DAY.

I WANT THEM FOCUSED THOSE EIGHT HOURS ON JUST TRYING TO, YOU KNOW, GET THE PAST OR DO WANT TO SPLIT THE HALF, FINISH THE PASS AND HALF YOU'D RATHER GET GET THE INFORMATION FROM THEM TO KNOW YOU'RE GOING DOWN THE RIGHT PATH.

[03:15:01]

WELL, I GET THAT. BUT WE DON'T KNOW WHAT WE DON'T KNOW.

AND SO IT'S IMPORTANT THAT IF WE ARE PUT ON NOTICE, WE CAN, YOU KNOW, LIGHT A FIRE OURSELVES AND MAKE SURE THAT THE RIGHT INFORMATION IS GETTING BECAUSE NOW IT'S THEY'RE REPRESENTING US IN A SENSE.

RIGHT. AND WE'RE PAYING FOR THAT REPRESENTATION.

AND SO WE WANT TO MAKE SURE THAT WHATEVER YOU NEED IS GETTING GETTING TO YOU.

AND SO IF IT MEANS, YOU KNOW, A PHONE CALL, THEN WE CAN THEN THE BOARD CAN TAKE ACTION TO SEE IF IF WE CAN MOVE THINGS ALONG.

PAGE 14. I GUESS I'VE GOT THREE MORE THINGS AND I'LL WRAP IT UP HERE.

ON PAGE 14. AGAIN, IF YOU'RE ONE OF THOSE JUST BOTTOM LINE ORIENTATED.

AND HOW DO WE DO? WELL, OF COURSE THERE'S NET CHANGE IN FUND BALANCE IS, YOU KNOW, YOU PRETTY MUCH BROKE EVEN, RIGHT? EXPENDITURE IS PRETTY MUCH EQUAL TO REVENUES.

YEAH, IT'S -83,000.

BUT AS A PRACTICAL MATTER.

OH, EXCUSE ME. AS A PRACTICAL MATTER, YOU'RE BROKE EVEN.

OKAY. I WAS GOING TO POINT OUT THAT FOOTNOTE THAT THAT YOU MENTIONED, BUT I THINK WE'VE KIND OF.

UNDERSTOOD THAT. THERE WAS ONE OTHER FOOTNOTE I JUST WANT TO JUST BRING UP BEFORE I JUMP TO THE OTHER PART OF THE REPORT, AND THAT IS ON PAGE 30, JUST IDENTIFYING WHAT YOUR COMMITMENTS ARE LEVEL AT THAT TIME AND THE PROJECT THAT YOU HAD REMAINING.

UM, AND THEN AND THEN ALSO JUST IDENTIFYING JUST THE BENEFICIARY OF THOSE PROJECTS.

OBVIOUSLY YOU SEE VANGUARD AND MOSTLY MOSTLY CITY OF BURG.

BUT THAT FOOTNOTE IS THERE IN CASE THAT INTEREST YOU.

I HAD A QUESTION ON PAGE.

MAYBE YOU CAN EXPLAIN IT TO ME A LITTLE BIT.

PAGE 27 ON THE DEFEASANCE OF DEBT.

SO I DIDN'T KNOW WHETHER DEFEASANCE OF DEBT WAS.

AND I THOUGHT, OKAY, SO IT'S BASICALLY WHEN YOU VOID A BOND OR A LOAN ON A BALANCE SHEET, WHEN THE BORROWER SETS ASIDE CASH OR BONDS SUFFICIENT TO SERVICE THE DEBT, I LOOKED IT UP.

SO BASICALLY YOU YOU CAN VOID IT NOW BECAUSE YOU KNOW, YOU HAVE ENOUGH TO SET THAT ASIDE.

BUT WHAT DOES THAT MEAN IN TERMS OF THE 13 MILLION THAT YOU SAY REMAINS OUTSTANDING? SO THAT'S A 13 MILLION.

THAT'S. YOU WHEN YOU DEFEAT SADAT, YOU TAKE MONEY THAT YOU HAVE AND YOU GIVE IT TO A THIRD PARTY.

RIGHT. TYPICALLY THE TRUST DEPARTMENT AT A BANK.

RIGHT. AND SO WHEN YOU GIVE IT TO A THIRD PARTY, THEN THEY'RE RESPONSIBLE NOW FOR MAKING FOR FOR MAKING THOSE DEBT PAYMENTS FOR YOU.

AND SO ALL WE'RE DISCLOSING IS HOW MUCH ARE THOSE STILL OUTSTANDING THAT STILL NEED TO BE DUE TO BE PAID.

SO THAT'S THE 13 MILLION THAT'S STILL OUTSTANDING.

OKAY. THAT NOT NOT NECESSARILY ON YOUR BOOKS UNLESS UNLESS, FOR EXAMPLE, IF YOU HAD LIKE I'M MAKING UP THE NUMBERS LIKE 9% DEBT AND THEN YOU GO GET 2% DEBT.

RIGHT. AND SO AND SO YOU WANT TO PAY OFF THAT 9%.

SO YOU TAKE ON NEW DEBT AT 2%.

YOU TAKE THE PROCEEDS AND PUT IT IN A TRUST DEPARTMENT OR SOMEWHERE, AND THEY CONTINUE TO SERVICE THAT DEBT FOR YOU.

AND YOU YES, YOU GOT DEBT, BUT NOW IT'S 2% DEBT.

OKAY, BUT THAT'S THE WAY IT ALSO REMOVED FROM BALANCE SHEET, RIGHT? YEAH. AND THAT WAS THE ISSUE.

THAT WAS THE ISSUE THAT WAS REFERRING TO THAT CAUSED THAT THOSE THOSE ADJUSTMENTS.

IT WASN'T REMOVED.

YEAH. WHICH IS A PRIMARY FUNCTION OF THAT.

OR ONE OF THEM FOR THE PURPOSE TO GET IT OFF? YES. YES.

SO SO THE OTHER THING I WANTED TO I WANTED TO POINT OUT AND JUST ACKNOWLEDGE AND I'LL GO THROUGH THIS IN AS MUCH DETAIL AS YOU WOULD LIKE, BUT SO I'LL START HERE.

AND IF IT'S SUFFICES, THEN THAT'S FINE.

SO ON PAGE 39 AND 40.

YOU'LL SEE. YOU'LL SEE A LETTER AND THAT LETTER IS REQUIRED.

IT'S REQUIRED UNDER, I MENTIONED EARLIER, GOVERNMENT AUDITING STANDARDS.

I GOT TO PUT TOGETHER A LETTER.

OKAY. AND ONE OF THE THINGS THAT SPEAKS TO IS, YOU KNOW, INTERNAL CONTROLS AND THINGS OF THAT NATURE.

AND HERE'S HERE'S WHERE FOR DEFICIENCIES IN INTERNAL CONTROLS ARE BEING IDENTIFIED.

RIGHT. AND AND THEY'RE BEING CATEGORIZED BETWEEN MATERIAL WEAKNESSES, WHICH ARE YOU KNOW, I DON'T WANT TO SAY THE WORST THING YOU CAN HAVE, BUT I'M JUST SAYING, IF YOU HAD TO RANK THEM, YOU KNOW, MATERIAL WEAKNESS WOULD BE, YOU KNOW, THE MOST SEVERE AND THEN YOU'D HAVE SIGNIFICANT DEFICIENCIES WOULD BE THE NEXT.

AND THEN YOU HAVE OTHER COMMENTS.

OKAY. AND SO WE ARE REPORTING TO YOU.

3455. COMMENTS ONE THE FIRST ONE WHICH IS A MATERIAL WEAKNESS.

AND THE OTHER FOUR RELATE TO SIGNIFICANT, SIGNIFICANT DEFICIENCIES.

I CAN GO THROUGH. THIS IS.

I'M AT YOUR PLEASURE. SO IF.

YOU ALL HAVE SPENT THE TIME AND JUST WANT JUST TO ABSORB THEM AND PERCOLATE DOWN AMONGST YOURSELF AND MANAGEMENT AND THAT'S TOTALLY FINE.

OR WE CAN GO THROUGH HERE ONE BY ONE.

BUT JUST I JUST WANT TO KNOW THAT THERE ARE THINGS IN HERE THAT NEED TO BE CORRECTED.

[03:20:01]

AND WHAT YOU ALSO HAVE IS A RESPONSE FROM MANAGEMENT ON HOW THEY PLAN ON ADDRESSING THE MATTER.

YEAH, THOSE WERE THE ONES I KNOW FROM UNIVERSITY.

YOU NEVER WANT TO SEE A MATERIAL WEAKNESS ON ON ANYTHING OR EVEN THE SIGNIFICANT.

SO I THINK ON, ON NUMBER ONE, THE MATERIAL WAS THE ONE YOU TALKED ABOUT WHERE THERE WERE MISTAKES MADE IN, IN WHAT WAS STILL CARRIED OVER FROM THE.

YEAH. AND SO NOW AT LEAST WE KNOW THAT THOSE HAVE BEEN THERE'S THERE'S SOME TRANSPARENCY NOW THEY THEY KNOW THEY EXISTED.

THOSE HAVE BEEN REMOVED.

AND WE NOW HAVE A CLEAN SET IN THE SENSE THAT AND AND DEVELOPING INTERNAL CONTROLS TO ENSURE IT DOESN'T HAPPEN AGAIN.

BUT WE WANT TO MAKE SURE THAT IT DOESN'T HAPPEN AGAIN.

OKAY. UM, THE OTHER ONE HAD TO DO, WHICH I WASN'T SURE THE INVESTMENT POLICY, WHICH WAS NUMBER TWO.

UM, AND THAT WE DIDN'T COMPLY WITH THE PROVISIONS OF THE PUBLIC FUNDS INVESTMENT ACT BECAUSE WE DID NOT HAVE AN INVESTMENT POLICY IN PLACE FOR THE END OF SEPTEMBER 2022.

BUT THE CITY DID NOT HAVE AN INVESTMENT POLICY.

YEAH. SO. SO. SO HERE.

SO HERE'S WHERE WE MAY BE SPLITTING SOME HAIRS.

RIGHT? SO YOU'RE YOU'RE A BORED CORPORATE.

YOU'RE SEPARATE ENTITY.

YES. RIGHT.

THE MAJORITY OF THE PEOPLE ON THIS ON THIS BOARD ARE NOT CITY APPOINTED.

RIGHT? CORRECT. OKAY. SO SO YOU HAVE AN OBLIGATION, I THINK, TO HAVE YOUR OWN POLICY.

IT COULD BE THE SAME POLICY.

OKAY. BUT WE BELIEVE YOU HAVE AN OBLIGATION TO HAVE YOUR OWN POLICY.

AND IF YOU'RE GOING TO COMPLY WITH THE ACT, THERE ARE SOME OTHER THINGS RELATED TO INVESTMENT TRAINING AND THINGS OF THAT NATURE.

I'M NOT SUGGESTING IF YOU LOOK AT YOUR HISTORY OF INVESTING, IT'S PRETTY CONSERVATIVE.

JUST LIKE MOST ENTITIES.

IT DOESN'T HAVE TO BE OVERLY COMPLICATED OR OR WHATNOT.

BUT I DO THINK THAT THERE IS SOMETHING THAT YOU ALL SHOULD HAVE THAT'S DIFFERENT.

BUT BUT THERE IS SOME MAIN POINTS IN THERE IN TERMS OF DIVERSIFICATION, RISK TOLERANCE, POLICY.

I MEAN, THERE IS SOME THAT YOU SHOULD HAVE.

THERE IS TO THE FUND.

SO ANYBODY WHO READS THAT AND WE'RE AGGRESSIVELY.

INVESTING IN SOMETHING.

IT'S IN THE POLICY.

SO WE'RE DOING WHAT WE'RE DOING.

YEAH, I THINK I THINK I THINK IT WOULD BE PRUDENT BECAUSE IT CERTAINLY COULDN'T HURT.

RIGHT. I THINK WE'D BE PRUDENT TO HAVE YOUR OWN POLICY.

RIGHT. SO JUST BASED ON, AGAIN, SOME PRIOR HISTORY IS ANNUALLY, THE BOARD CAN LOOK AT THE POLICY AND WE CAN ADOPT THE CITY'S POLICY.

BUT WE DO NEED TO MAKE A MOTION ON IT.

APPROVING IT. YEAH.

YEAH. NO, I THINK WE MOST DEFINITELY HAVE TO HAVE OUR OWN.

WE CAN LOOK AT WHAT THE CITY IS DOING, BUT WE WE SHOULD BE ABLE TO REVISE THAT IF WE DON'T LIKE WHAT THAT POLICY IS.

AND DON'T FORGET, THERE ARE OTHER ASPECTS OF THAT ACT RELATED TO TRAINING.

YEAH. SO, YEAH, NOTICE THAT IT SAID WE HAVE TO GO THROUGH A TRAINING AS WELL.

RIGHT? OKAY.

AND THEN YOU SAID ON THE, ON THIS OTHER ONE, THE OH THREE, THAT ONE WAS THE DISASTER RECOVERY PLAN.

CORRECT. AND YOU SAID THAT THE CITY HAD BEEN WORKING ON THAT.

IS THAT ANOTHER ONE OF THOSE WHERE WE DO OUR OWN? YEAH, BECAUSE YOUR ACCOUNTING IS ON THEIR SYSTEM.

YEAH. IT WOULD SEEM TO ME THAT YOU WOULD WANT TO KNOW THAT YOUR DATA IS CAN BE RECOVERED.

THIS IS BASICALLY PROTECTING YOUR DATA.

RIGHT. RIGHT. AND SO AT THIS POINT TURN ALL THE CITY HASN'T IS WORKING ON TRYING TO GET THEIRS GOING.

BUT BY DEFAULT, THAT PUTS YOUR DATA AT RISK.

AND THEN THE LAST ONE WAS TO ASSURE ADEQUATE CONTROLS ARE IN PLACE.

AND LET'S SEE. WHAT WAS THAT ONE? YEAH. OH, FOR. ADEQUATE CONTROLS IN PLACE FOR TIMELY COMPLETION SO THAT WE'RE NOT HAVING THIS ISSUE WITH LAST MINUTE TURNOVER OF DOCUMENTATION AND SO FORTH.

OKAY. I WILL SAY THIS, AND ONLY BECAUSE YOU MENTIONED THE WORD.

TURNOVER BECAUSE I DON'T WANT TO MINIMIZE THIS POINT.

AND, I DON'T KNOW, TEN YEARS AGO.

ACCOUNTS WERE GENERALLY EASY TO FIND.

OKAY. BUT IT IS A REAL THING THAT ACCOUNTANTS ARE EXTREMELY DIFFICULT TO FIND.

[03:25:02]

SO I'M NOT MAKING EXCUSES FOR THIS CITY, BUT I JUST WANT TO TELL YOU THAT THAT IS A REAL THING.

A REAL CHALLENGE.

AND SO I JUST WANT TO JUST IT'S A REAL THING.

DON'T DON'T JUST SAY, OH, JUST GO HIRE SOME PEOPLE.

WELL, NO, THAT'S NOT WELL.

AND I KNOW I MEAN, THE CITY HAS BEEN IN THE PROCESS OF THEY HAD BEEN LOOKING TO HIRE SOME ACCOUNTS OR ACCOUNTANTS.

ACCOUNTANTS. ACCOUNTANTS.

OH, YES, YES, YES. DIFFICULT TO HIRE.

YEAH, YEAH, THAT'S A GOOD POINT.

YEAH. THEY ARE RETIRING, RIGHT? THAT'S A GOOD POINT, BECAUSE EVERYTHING WE'RE TALKING ABOUT ENDS FISCAL YEAR 2022, RIGHT? SEPTEMBER 9TH OF 2022.

SO WE'RE TALKING ABOUT OCCURRENCES THAT HAPPENED FROM 921 TO 922, WHICH JUST AS EVERYONE KNOWS, WE HAVE A COMPLETELY DIFFERENT FINANCE DIRECTOR NOW.

BACK THEN IT WAS COMPLETELY DIFFERENT ADMINISTRATION.

AND SO FOR NEW STAFF COMING IN, IT WAS, FROM WHAT I GATHER, WAS PRETTY DIFFICULT TO MAKE SENSE OF OTHER PEOPLE'S WORK FROM BACK THEN.

AND SO THAT'S AN ONGOING CHALLENGE.

I KNOW THE CITY HAS HIRED, BUT THEN THEY DON'T STICK AROUND.

I MEAN, EVERYBODY'S COMPETING AND LIKE YOU SAID, WE HAD WE HAD AN INTERIM FOR A LITTLE WHILE, TOOK US A WHILE TO FIND SOMEONE TO HIRE.

WE TEND TO BE LOW ON EVERYBODY'S RADAR UNTIL YOU DON'T HAVE ONE, RIGHT? RIGHT. THEN BECOMES AN ISSUE.

RIGHT. KIND OF HOPEFULLY KIND OF WHAT THEY SAY ABOUT LAWYERS.

YEAH, HOPEFULLY THEY DON'T LIKE THEM UNTIL YOU NEED ONE.

HOPEFULLY THIS NEXT AUDIT WOULD BE A LOT EASIER FOR YOU.

I HOPE SO. SO AND I WILL SAY IT WAS A DIFFERENT AUDITOR.

A DIFFERENT FINANCIAL ADVISOR.

YEAH. COMPLETE OVERHAUL OF CITY ADMIN AND FINANCE DEPARTMENT ADMIN, AS WELL AS THE CONSULTANTS OR OUTSIDE AUDITORS THAT THAT ARE NOW NEW SINCE LAST YEAR.

NOT NOT DURING THIS TIME.

NOW THERE'S ONE COMMENT LEFT JUST TO LET YOU TURN THE PAGE JUST IN CASE.

I DON'T KNOW IF YOU ALL HAD A QUESTION ON THAT.

WOULD THAT REFER TO. AND I CAN SUMMARIZE BY JUST SAYING YOUR DEBT OR CERTAIN DEBT HAS CERTAIN COVENANTS THAT REQUIRES YOU TO MAINTAIN CERTAIN BALANCES AND SINKING FUNDS AND THINGS OF THAT NATURE. AND IT'S IMPORTANT TO MONITOR.

I MEAN, YOU DON'T WANT TO BE NON-COMPLIANT OF THE DEBT COVENANT.

AND IN FACT, IF YOU LOOK AT I'LL GET YOU TO JUMP TO PAGE 24.

BECAUSE THIS IS REALLY WHAT WHAT IT PERTAINS TO.

JUMP OVER TO PAGE 24.

YOU SEE A YOU SEE A FOOTNOTE THAT SAYS SINKING FUNDS, A SINKING FUND IS REQUIRED BY YOUR DEBT COVENANT.

AND YOU'LL NOTICE A NEGATIVE NUMBER.

REMEMBER, WE DON'T LIKE NEGATIVE NUMBERS.

YOU SEE, YOU WERE SHORT.

OH, THE 12,015.

YEAH. IT WASN'T MATERIAL ENOUGH FOR US TO, BUT IT'S IMPORTANT ENOUGH.

YOU DO NOT WANT TO BE POLISHING YOUR DEAD COFFINS.

RIGHT. AND SO.

AND THAT'S JUST THE COMPUTATION AND MONITORING.

SO. ON THOSE WHERE THEIR BOND RESERVES AND THIS IS MAYBE A QUESTION FOR OUR STAFF, BUT HOW DO YOU HOW DO YOU FIX THAT? CAN YOU JUST TRANSFER FUNDS, PUT MONEY IN? OKAY. AND YOU GOT. YEAH, OKAY.

YOU GOT TO MAKE UP FOR THAT DEFICIENCY.

WE HAVE DONE THAT THIS LAST MONTH.

LAST WEEK. OKAY.

SO AT THIS POINT, WE SHOULDN'T SEE ANY THERE SHOULDN'T BE ANY DEFICIENCY OR ANY SINKING FUND.

YEAH. I MEAN, OUR MEASUREMENT DATE IS ONLY AT ONE POINT OF TIME.

YEAH, BUT STAFF SHOULD BE DOING IT NO LESS THAN MONTHLY.

IN TODAY'S ENVIRONMENT, YOU CAN MAKE SOME MONEY.

MR. LONGORIA. JUST FOR THE RECORD, WHEN WHEN WERE YOU HIRED AS A NEW AUDITOR? YES. OUR ENGAGEMENT LEADERS ACTUALLY REFERRED TO IN THAT FIRST LETTER I MENTIONED TO YOU, WE WERE HIRED ON SEPTEMBER 9TH, 2022.

THAT'S THE DATE OF OUR ENGAGEMENT.

WE HAD A FIRST MEETING WITH MANAGEMENT IN NOVEMBER.

IT'S NOT ABOUT RIGHT. WE'VE BEEN AT IT EVER SINCE.

IT'S BEEN. BEEN A LONG HAUL.

OKAY. THANK YOU FOR COMING ON.

THANK YOU FOR.

AND THANK YOU FOR EXPLAINING IT.

I HOPE THAT MAKES SENSE.

THANK YOU. THANK YOU. THANK YOU.

OH, AND YOU MAY HAVE EXPLAINED THIS.

LET ME SEE IF I HAD. OH, YOU DID.

[03:30:02]

YOU DID. I'M SORRY. ON THE EXPENDITURES EXCEEDING APPROPRIATION.

THAT WAS THE ONE WHERE I HAD HAD QUESTIONS.

BUT YEAH, YOU EXPLAIN THAT.

WELL, THANK YOU ALL FOR YOUR TIME AND HAVE A GOOD DAY.

OKAY. VERY GOOD.

WE ARE HERE TO SERVE. SO THANK YOU.

THANK YOU, SIR. THANK YOU FOR ALL YOUR WORK.

THANK YOU ALL. OKAY.

SO I THINK WE NEED TO MAKE A MOTION TO ACCEPT THE THE 2022 AUDIT.

CAN I GET A MOTION BEFORE WE DO THAT? YOUR RECOMMENDATION IS TO ACCEPT THIS AUDIT.

MY RECOMMENDATION IS TO ACCEPT THE AUDIT.

YES, THIS IS SOMETHING THAT.

IS PART OF THE PROCESS.

THERE WAS A LOT OF TURNOVER, AS THEY SAID WHEN I CAME IN AND WAS ASKING QUESTIONS, THERE WAS HARD TO GET ANSWERS.

TO THIS DAY, IT'S STILL A LITTLE DIFFICULT, BUT WE'RE WE'RE WORKING THROUGH IT AND I SEE THAT THERE IS A DIFFERENCE NOW, AS DAN WAS ALLUDING TO, IN TERMS OF THE PERSONNEL.

AND IT SEEMS LIKE THEY'RE STARTING TO STAFF UP AT THE FINANCE DEPARTMENT AND THAT'S GOING TO MAKE A DIFFERENCE.

I'M STAFFING UP ALSO, AND THAT MAKES A DIFFERENCE FOR ME TO LOOK AT THIS EVEN CLOSER.

BUT YEAH, WE'LL SEE A BIG IMPROVEMENT ONE YEAR OVER THE NEXT.

YEAH. AND THE ONLY REASON I ASK THAT IS BECAUSE, YOU KNOW, US AS BOARD MEMBERS WE LOOK OVER.

BUT OF COURSE WE'RE NOT. PROFESSIONALS AND ALL THIS.

SO EVERY TIME THAT THAT THAT I'M GOING TO VOTE ON SOMETHING, I ALWAYS ASK EVERYONE THAT PREPARED FROM THE FINANCE TO THE AUDITOR TO THE DIRECTOR AND WHEN THEY'RE ALL IN AGREEMENT, WELL, YOU KNOW, HOW CAN WE KNOW MORE THAN THEM, RIGHT.

EACH EACH PERSON. SO THAT'S WHY I JUST WANTED WANTED YOUR RECOMMENDATION FOR THE RECORD.

AND I WOULD ADD ALSO FROM A FROM A BOARD PERSPECTIVE PERSONALLY, SOMETHING LIKE ACCOUNTING AND LEGAL MATTERS SHOULD NEVER BE A SURPRISE TO THE BOARD.

THIS WAS A SURPRISE FOR ME TODAY.

AND IN THE FUTURE I WOULD LIKE NO SURPRISES.

UNDERSTOOD. SO WE'VE GOT A RECOMMENDATION TO ACCEPT THE AUDIT.

CAN WE GET A MOTION TO ACCEPT THE AUDIT? 22, 2022 AUDIT? I'LL MAKE A MOTION. SECOND, WE GOT THE MOTION.

AND A SECOND. ALL IN FAVOR.

SAY AYE. RAISE YOUR RIGHT HAND.

I WAS THINKING WE'LL GO INTO LET'S DO D AND E, AND IF EVERYBODY'S OKAY WITH IT, WE CAN GO INTO EXECUTIVE BECAUSE I THINK G AND H ALSO KIND OF FALL INTO THAT EXECUTIVE AND THEN WE CAN COME BACK AND AND ACTUALLY VOTE ON ANY OF THOSE THAT WE NEED TO.

MOTION PASSES. OKAY.

ARE YOU ALL OKAY WITH THAT? OKAY. DO WE NEED A MOTION FOR THAT, HOMER? YES. ON THE ITEMS THAT YOU DO WANT TO TAKE INTO EXECUTIVE, YOU WOULD NEED TO MAKE A MOTION ON THOSE JUST TO MAKE THAT CLEAR.

YEAH. OKAY.

OKAY. SO F IS THE PERSONNEL COMPENSATION PLAN.

G IS THE SERVICES AGREEMENT BETWEEN THE CITY OF EDINBURG AND THE EDC? DO YOU HAVE A FRONT PAGE OR A COVER PAGE? I DON'T THINK WE HAVE THAT.

IT'S ON THE AGENDA. I'M SORRY.

YEAH. GO BACK TO THE AGENDA.

NOT. NOT. WE DIDN'T HAVE THE AGENDA.

YEAH, WE'RE MISSING THAT. YEAH, I GUESS I PRINTED IT OUT FROM ONLINE.

DO YOU HAVE THAT? IS THAT NOT PART OF YOUR.

YEAH. NO, WE DON'T HAVE. I'M LOOKING AT MY FOLDER THAT I PRINTED FOR THE ITEMS OF AGENDA IS IN THERE.

OKAY. AND YOU CAN PULL IT UP ON YOUR PHONE.

YOU KNOW, THERE'S GOING. THANK YOU, CARLOS.

YEAH. SORRY ABOUT THAT, GUYS.

I DIDN'T KNOW THAT IT DIDN'T INCLUDE IT.

I WAS PRINTING. I PRINTED OUT ONE.

YEAH. SO WHAT WERE YOU SAYING? OKAY, SO IF YOU LOOK AT I WAS THINKING WE DO DNA HERE, WE DISCUSS IN EXECUTIVE F, G AND H, AND THEN WE COME BACK INTO OPEN SESSION.

AND IF WE NEED TO VOTE ON ANY OF THOSE, WE DO THAT BACK WHEN WE GET BACK FROM OPEN SESSION.

I'LL MAKE A MOTION. I'LL MAKE A MOTION TO MOVE TO EXECUTIVE SESSION.

SECOND. ALL IN FAVOR, SAY AYE.

OKAY, THAT PASSES. SO WE'LL DISCUSS THOSE AND THEN COME BACK TO THEM IN OPEN SESSION AFTER EXECUTIVE.

OKAY, SO ITEM D IS THE APPROVAL OF THE REQUEST.

CONSIDER APPROVAL OF A REQUEST FROM THE MUSEUM OF SOUTH TEXAS HISTORY TO SPONSOR FANDANGO 2023.

AND I THINK THEY'RE THE THE REQUEST WAS ANYWHERE FROM 1600 TO 2600.

THOSE WERE THE SPONSORSHIP LEVELS.

INCLUDED IN YOUR PACKET WAS THE REQUEST FORM WITH THE INFORMATION.

[03:35:02]

FANDANGO I THINK HAS BEEN A PRETTY BIG EVENT THAT THE MUSEUM HAS EVERY YEAR.

AND IF YOU LOOK ALSO IN THERE AT THE VERY END, IT TALKS ABOUT FUNDING HISTORY AND WHAT THEY'VE BEEN RECEIVING FROM EITHER ORGANIZATION, RECEIVED OTHER FUNDING FROM THE EDC AND OR THE CITY OF EDINBURG, AND THEN IT LISTS PER YEAR.

COULD YOU EXPLAIN THAT? RANDALL I WASN'T SURE WHAT THE $255,000 WAS.

IS THAT FROM THE CITY, THE 255,000 THAT THEY GOT FROM US? THAT'S FROM THE CITY. I GUESS THAT THEY FUND THE MUSEUM.

AND THEN BEHIND THAT IS THE ACTUAL EVENT.

IT'S OCTOBER THE 7TH.

IT'S THE FLIER, AND IT TELLS YOU WHAT YOU GET FOR THE TWO DIFFERENT SPONSORSHIP LEVELS THAT ARE BEING PROPOSED.

THIS ISN'T VERY DIFFERENT FROM OTHER EVENTS WHERE WE'RE SPONSORING A TABLE.

THE DIFFERENCE IS THAT OUR SPONSORSHIP POLICY HAS LEVELS THAT EXCEED MY AUTHORITY SIX $1,600 VERSUS $1,000. THAT'S THE DIFFERENCE.

IT'S A $600 DIFFERENCE TYPICALLY, AND I'M GOING TO SUGGEST FOR THE NEXT ANNUAL MEETING THAT WE CHANGE THE SPONSORSHIP LEVELS, THE POLICY. THIS WOULD BE SOMETHING THAT THAT IS VERY MINOR AND THUS I'M RECOMMENDING A $1,600 SPONSORSHIP.

IT'S A GOOD COMMUNITY EVENT.

IT'S A GOOD WAY FOR THE EDC TO BE OUT THERE AND BE VISIBLE AND ALSO GET THEMSELVES OUT IN FRONT OF POTENTIAL PROSPECTS AND GET OUR NAME OUT.

IT'S A IT'S A RELATIVELY MINOR EXPENSE COMPARED TO A LOT OF THE OTHER THINGS THAT WE'RE DOING.

SO YOU THINK THE RETURN ON THE INVESTMENT WOULD BE SUFFICIENT TO SPONSOR IT? THE LEVEL OF 1600? YEAH, FOR $1,600, THE ADVERTISING ITSELF IS WORTH MORE THAN THAT.

OKAY. WHAT PROSPECTS WERE YOU TALKING ABOUT? PROSPECTS WOULD ATTEND THIS.

I'M SORRY. I CAN'T HEAR YOU. YOU SAID.

YOU SAID IT WOULD. WE CAN GET IN FRONT OF PROSPECTS.

WHAT PROSPECTS? WELL, YOU NEVER KNOW WHO'S THERE.

OH, OKAY. WELL, IT IS AN EVENT THAT DRAWS A LOT OF THE BUSINESS PEOPLE OF OF THE CITY DEVELOPERS AND OTHERS TO THE MUSEUM.

ARE YOU? AND THEN I THINK WE'RE GOOD.

WE'RE GOOD. YOU OKAY WITH 1600? OKAY. CAN WE GET A CAN I GET A MOTION TO SPONSOR AT THE RECOMMENDED LEVEL OF 1600? I'LL MAKE A MOTION TO EDDIE.

EDDIE MAKES A MOTION.

CAN I GET A SECOND? SECOND AND ROLL IN SECOND? ALL IN FAVOR. SAY AYE. RAISE YOUR RIGHT HAND.

OKAY. 1600.

ALL RIGHT. NOW THAT WE ALL HAVE AN AGENDA.

THE OTHER ITEM IS ON THE PRESENTATION OF YEAR TO DATE FINANCIAL REPORT ENDING ON JULY 31ST, 2023.

OKAY. FINANCIAL REPORT IN YOUR PACKET IS REALLY WHAT I HAVE TO DEAL WITH ON A FAIRLY REGULAR BASIS.

THAT'S NOT TRUE.

THERE WAS APPROXIMATELY $700,000 WORTH OF GENERAL SALES TAX THAT CAME TO US.

IT'S NOT REFLECTED IN THIS REPORT.

I DON'T EVEN WANT TO PRESENT THIS REPORT, BUT IT WAS GIVEN TO ME.

THIS IS THE STUFF THAT I HAVE TO DEAL WITH.

I GET MORE INFORMATION SOMETIMES ONLINE FROM THE GENERAL FROM THE COMPTROLLER'S OFFICE THAN I DO FROM MY OWN FINANCE DEPARTMENT.

SO IT'S DIFFICULT TO TO PRESENT SOMETHING TO YOU ALL THAT'S NOT READY.

YEAH, I THINK I THINK THAT'S THE WAY WE NEED TO GO BECAUSE PRETTY HARD TO PROVE SOMETHING OR PASS SOMETHING THAT WE CAN'T RELY ON.

YOU KNOW, IT'S NOT ACCURATE, IT'S INACCURATE, AND IT'S HARD FOR ME TO TO REVIEW IT UNTIL I PUT IT IN A FORMAT THAT THAT'S UNDERSTANDABLE TO ME AS WELL.

I'LL MAKE A MOTION TO PASS ON THE TABLE.

[03:40:02]

MOTION TO TABLE. SECOND.

SECOND. OKAY.

SO ALL IN FAVOR SAY AYE.

OKAY. THAT ITEM IS TABLED.

OKAY. SO CAN WE GET A MOTION TO GO INTO EXECUTIVE SESSION TO CONSIDER THE REMAINING ITEMS ON THE AGENDA? SECOND, ALL IN FAVOR, SAY AYE.

ALL RIGHT. AT 640 AND WE ARE ENTERING INTO EXECUTIVE SESSION.

I THINK. I HAVEN'T HAD TO USE IT YET, BUT I DON'T.

GREAT.

[03:52:33]

[03:52:36]

I'D LIKE TO CALL THE MEETING TO ORDER OF THE EDINBURG ECONOMIC DEVELOPMENT CORPORATION.

LET'S START WITH CALLING ROLL.

AARON IT UP. THEN THERE'S.

ROLAND GOMEZ, PRESIDENT.

RAUL RESENDEZ GARCIA PRESIDENT.

WE HAVE QUORUM, MA'AM. THANK YOU SO MUCH.

WOULD YOU PLEASE JOIN ME IN PLEDGE OF ALLEGIANCE? I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA.

TO THE REPUBLIC FOR WHICH IT STANDS ONE NATION UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FOR ALL.

I KNOW THIS HAS BEEN POSTED THE REQUIRED PERIOD OF TIME.

ARE THERE ANY CONFLICTS TO DISCLOSE? NO, NONE. THANK YOU.

CARLOS, DO WE HAVE ANYBODY THAT SIGNED UP FOR PUBLIC COMMENT? OKAY. THANK YOU. A DIRECTOR'S REPORT.

I'LL BE BRIEF ON MY DIRECTOR'S REPORT BECAUSE WE HAVE A LENGTHY AGENDA.

BUT WHAT'S INTERESTING TO NOTE IS THAT WE HAVE 1406 ADDITIONAL PEOPLE IN THE LABOR FORCE.

SO THAT MEANS THAT OVER THAT LAST YEAR WE'VE CREATED SOME MORE JOBS.

AND SO EVEN THOUGH UNEMPLOYMENT RATE SEEMS TO STAY STEADY, THERE'S MORE GROWTH COMING IN.

SO I DID WANT TO NOTE THAT AS FAR AS THE LABOR STUDY GOES.

IN ADDITION TO THAT, IN YOUR PACKET, YOU HAVE SOME UPDATES FROM THE ALLIANCE FOR I-69, TEXAS.

THE SOCIAL MEDIA MONTHLY REPORT, SOME NEW FOLLOWERS AND ALSO OF NOTE IN OUR COMMERCIAL PERMITTING AND RESIDENTIAL PERMIT CONSTRUCTION

[03:55:07]

VALUES OVER LAST YEAR, WE HAVE EXCEEDED LAST YEAR'S YEAR TO DATE NUMBERS BY CLOSE TO $70 MILLION.

SO WE'RE AT $278 MILLION TO DATE IN TOTAL CONSTRUCTION SO FAR.

AND THAT IS REALLY EVEN SURPASSING LAST YEAR'S END OF YEAR TOTALS.

SO VERY GOOD PERFORMANCE THUS FAR IN TERMS OF COMMERCIAL AND RESIDENTIAL GROWTH.

THERE'S NEW CONSTRUCTION IN TERMS OF SUBDIVISIONS AS WELL.

THERE'S 63 UNDER CONSTRUCTION RIGHT NOW WITH OVER 4800 LOTS UNDER DEVELOPMENT.

AND THEN IN REVIEW, WE HAVE 34 NEW SUBDIVISIONS WITH THAT TOTALS ABOUT 1300 NEW LOTS AND 67IN PRELIMINARY REVIEW, WHICH IS ANOTHER ALMOST 1600 LOTS.

SO VERY, VERY GOOD.

RESIDENTIAL GROWTH RATES GOING ON RIGHT NOW.

SOME OF THE UPCOMING CONFERENCES THAT WE WANT TO LET YOU ALL KNOW ABOUT IS TEAM TEXAS ECONOMIC SUMMIT IS TOMORROW THROUGH WEDNESDAY IN ODESSA.

I WILL BE FLYING OUT AT 630 IN THE MORNING TOMORROW MORNING.

CARLOS WILL BE IN AUSTIN FOR THAT ONE.

AND THEN CAFE CON USA AND CANADA IN CANADA IN MONTERREY ON SEPTEMBER 5TH.

CARLOS WILL BE ATTENDING THAT CONFERENCE AND ACTUALLY REPRESENTING US IN THE IN HIS BOOTH.

AND OF COURSE, ON SEPTEMBER 8TH, WE HAVE THE TDC SALES TAX WORKSHOP.

TEXAS ECONOMIC DEVELOPMENT COUNCIL HAS NOT HAD ONE OF THESE WORKSHOPS IN THE RIO GRANDE VALLEY IN A LONG TIME, IF EVER.

SO THIS IS AN OPPORTUNITY FOR LOCAL ELECTED OFFICIALS, BOARD MEMBERS AND STAFF TO LEARN A LITTLE BIT MORE ABOUT SOME OF THE NEW LEGISLATIVE REQUIREMENTS AND LEGISLATIVE CHANGES TO THE SALES TAX.

SOME OF THE UPCOMING EVENTS, ASIDE FROM OUR CITY COUNCIL WHERE WE WILL BE PRESENTING, HOPEFULLY THE PROGRAM WILL WORK IN THE BUDGET.

WE HAVE A RIBBON CUTTING COMING UP ON SEPTEMBER 15TH, THEN A JOB FAIR ON SEPTEMBER 14TH AS WELL, AND COORDINATION WITH WORKFORCE SOLUTIONS.

AND OF COURSE, THE SOUTH TEXAS INTERNATIONAL FILM FESTIVAL IS BETWEEN THE SEPTEMBER 14TH AND 16TH.

IN OCTOBER. OUR TDC ANNUAL CONFERENCE WILL BE IN HOUSTON.

THOSE OF YOU WHO ARE INTERESTED IN ATTENDING AND LEARNING A LITTLE BIT MORE ABOUT ECONOMIC DEVELOPMENT AND SOME OF THE UPDATES THAT ARE GOING ON, THIS WOULD BE A GOOD CONFERENCE TO ATTEND AS WELL.

AND THEN FINALLY, I JUST WANT TO SAY THAT THE ECONOMIC RIO GRANDE VALLEY PARTNERSHIP ECONOMIC SUMMIT THAT WAS HELD LAST WEEK WAS A VERY BIG SUCCESS.

A LOT OF PUBLICITY, A LOT OF PEOPLE THAT SHOWED UP IN EDINBURG TO HELP US TALK ABOUT REGIONALISM AND UNITY IN TERMS OF ECONOMIC DEVELOPMENT. YEAH, IT WAS A REALLY GOOD EVENT.

THINKING AS A REGION RATHER THAN INDIVIDUAL CITIES.

SET IT FOR THE REPORT.

ANY QUESTIONS OF RANDALL? ALL RIGHTY. I KNOW WE'RE GOING TO HAVE QUITE A LONG MEETING TODAY, SO LET'S GET TO APPROVAL OF THE MINUTES.

MADAM PRESIDENT. OH, HI.

WE HAVE COUNCILMAN AND BOARD MEMBER HERE, MR. DAN DIAZ. THANK YOU FOR JOINING US.

CAN WE GET A MOTION TO APPROVE THE MINUTES FOR JULY 12TH AND JULY 25TH? GET A SECOND. SO SECOND, ALL IN FAVOR SAY AYE OR RAISE YOUR RIGHT HAND.

OKAY. WE HAVE A VALLEY INITIATIVE PRESENTATION, AND I THINK WE HAVE ALIDA HERE.

IS IT ON? IT'S KIND OF HARD.

TEST. YES. THERE YOU GO. OKAY.

THANK YOU. SO MY NAME IS ALEIDA VILLAREAL AND I CURRENTLY SERVE AS CEO OF VALLEY INITIATIVE FOR DEVELOPMENT AND ADVANCEMENT.

FOR THOSE WHO MAY BE UNFAMILIAR WITH VIDA, WE ARE A NONPROFIT ORGANIZATION WHO HAS BEEN SERVING THE RIO GRANDE VALLEY FOR THE PAST 28 YEARS AND PROVIDING WRAPAROUND SUPPORT

[04:00:01]

SERVICES FOR COLLEGE COMPLETION AND COLLEGE SUCCESS.

AND SO WE'RE VERY THANKFUL FOR THE EDC FOR YOUR SUPPORT THIS YEAR.

AND A GRANT OF THE 50,000 IN WHICH OUR BENCHMARK WAS TO SERVE 15 RESIDENTS FROM EDINBURG IN YOUR PACKET IS A ONE PAGER PROJECT UPDATE IN WHICH WE ARE SHOWING THAT WE ACTUALLY EXCEEDED THE BENCHMARK AND SERVED 28 EDINBURG RESIDENTS.

AND I'M HAPPY TO ANSWER ANY QUESTIONS OR CONCERNS YOU MAY HAVE.

SO, MEMBERS, I KNOW WE WE HAD ALL HEARD FROM THAT BEFORE ABOUT THE WRAPAROUND SERVICES THAT VIDA PROVIDES.

WE WANTED TO MAKE SURE THAT IT WAS GOING TOWARDS EDINBURG RESIDENTS, WHICH IT WAS, AND THEY EXCEEDED IT.

I KNOW THAT SOME OF THE WORK THAT THEY'RE DOING IS THE KIND OF WORK THAT REALLY KEEPS KIDS IN SCHOOL, BUT ASIDE FROM THAT, REALLY PLACES THEM THEN INTO HIGH PAYING JOBS, WHICH IS CRITICAL.

WE WANT TO GET THEM OUT AND GET THEM IN THE WORKFORCE.

SO I'M GLAD TO SEE THAT THE NUMBERS HAVE INCREASED THE WAY OR AT LEAST THAT YOU DID BEYOND WHAT Y'ALL HAD PROMISED INITIALLY.

SO I THINK THERE'S A MATCH ALSO THAT Y'ALL WOULD PROVIDE.

IF WE DO 100,000, YOU'LL MATCH IT WITH 50,000, IS THAT RIGHT? CORRECT. DOES ANYBODY HAVE ANY QUESTIONS FOR MISS ARIEL? I DO. OF THOSE STUDENTS AND WHERE THEY'RE AT IN TERMS OF WHAT SCHOOL AND OR WHAT THEY'RE DOING? YES, ABSOLUTELY.

AS A MATTER OF FACT, WE DO SEND A QUARTERLY REPORT TO THE EDC, BUT WE CAN ALSO SHARE THAT WITH YOU ALL IF YOU PREFER TO RECEIVE IT AS WELL.

PLEASE. HOW SOON CAN WE GET.

BY TOMORROW. YEAH, I KNOW.

IT'S IN THE ONE PAGER.

IT SHOWS THE AREAS THAT THEY'RE STUDYING IN OR THAT.

SO THE STEM FIELDS, THE SPECIALIZED TRADES, SOCIAL SERVICES AND BUSINESS WITH THE LARGEST BEING THE SPECIALIZED TRADES.

SO I PROBABLY THAT PROBABLY MEANS THAT MOST OF THEM ARE EITHER GOING TO.

STC OR STC AND ACTUALLY WOULD BUY STC IF IT'S LOCAL, RIGHT? YES. BUT YEAH, THAT WOULD HELP TO HAVE THAT.

SO WITH A HIGHER CONTRIBUTION, I KNOW HE HAD CONTRIBUTED 50,000 ALREADY AND GREAT JOB, BY THE WAY, ON, ON HELPING, YOU KNOW, EXCEEDING WHAT YOU HAD PROMISED WITH BY DOUBLING THE CONTRIBUTION.

IS THERE A CHANCE THAT THESE NUMBERS FROM INCREASE 32, MAYBE A DIFFERENT NUMBER? YES, ABSOLUTELY.

SO I CAN PRETTY MUCH GUARANTEE YOU THAT IF THE BENCHMARK IS 30, THAT WE WOULD OVER EXCEED THAT BENCHMARK AS WELL FOR NEXT YEAR BECAUSE WE'RE ABLE TO BRAID YOUR INVESTMENT WITH OTHER FUNDING SOURCES.

AND JUST RECENTLY, WE WERE AWARDED A $3 MILLION NURSING GRANT FROM THE DEPARTMENT OF LABOR.

SO A LARGE PORTION OF THAT CAN BE LEVERAGED WITH YOUR INVESTMENT TO AGAIN EXCEED THE BENCHMARK AND SERVE MORE RESIDENTS.

SO. AND YOU'VE GOT A I NOTICED YOU'LL HAVE A DATABASE CALLED SOCIAL SOLUTIONS APRICOT.

YEAH, I REALLY LIKE THAT THAT TRACKING SYSTEM BECAUSE I THINK A LOT OF TIMES PEOPLE PLACE THEM AND THEN THEN THEY GET LOST AND THEN YOU DON'T KNOW WHAT HAPPENS TO THE PERSON.

ANY OTHER QUESTIONS? DO YOU ALL WANT TO WAIT FOR US TO GET THE DOCUMENT AND VOTE ON IT FOR THE NEXT MEETING? OKAY. THANK YOU SO MUCH, MISS.

SO WE HAVE CONSIDER ACCEPTING THE EDINBURG EDC 2022 AUDIT.

AND WE HAVE JOINING US FROM BURTON MCCUMBER AND LONGORIA RICKY LONGORIA.

AND TELL ME YOUR NAME AGAIN.

LUIS GOMEZ LOPEZ.

[04:05:01]

YEAH, WE HAVE LUIS LOPEZ.

THANK YOU. THANK YOU, MADAM CHAIRMAN.

AGAIN, MY NAME IS RICKY LONGORIA.

I'M MANAGING PARTNER OF THE FIRM OF BURTON, MCCUMBER AND LONGORIA.

PRIVILEGED TO ACTUALLY BE ABLE TO SERVE YOU ALL AND SERVING NOT ONLY YOU ALL, BUT THE CITY OF EDINBURG.

THIS IS MR. LUIS LOPEZ. HE IS AN AUDIT MANAGER WITHIN THE FIRM.

HE WAS THE ONE PROBABLY MORE HANDS ON THAN MYSELF IN TRYING TO GET THIS AUDIT TAKEN CARE OF AND AND COMPLETED.

UM, I HAVE THE OPPORTUNITY TO TO TO SPEAK TO MADAM CHAIRMAN BEFORE THE MEETING SAID, YOU KNOW, RELATIVELY SPEAKING, THIS REPORT SHOULD BE FAIRLY EASY.

THE CHALLENGE I'M HAVING IN TRYING TO PRESENT THIS YOU ALL'S REPORT IS REALLY JUST A NUMBER OF ERRORS THAT WE FOUND IN LAST YEAR'S REPORT THAT HAVE CARRIED INTO THIS YEAR'S REPORT.

AND SO I'M GOING TO TRY NOT TO SPEAK LIKE AN ACCOUNTANT, BUT I'VE BEEN DOING THIS FOR 30 YEARS.

IT'S GOING TO BE VERY HARD FOR ME TO DO SO.

SO I'M GOING TO DO THE BEST I CAN TO TRY TO SUMMARIZE IN PLAIN ENGLISH, IF YOU WILL, THE EFFECT THAT THOSE ERRORS HAD IN YOU ALL'S FINANCIAL STATEMENTS AND CERTAINLY THE SILVER LININGS, BECAUSE I DON'T WANT TO IMPLY THAT EVERYTHING'S BAD BECAUSE THERE ARE SOME SILVER LININGS IN THIS THAT THAT ARE VERY IMPORTANT TO MENTION.

THANK YOU. AND I HAD MENTIONED TO RICKY THAT WE MAY AT SOME POINT SAY, CAN YOU DUMB IT DOWN A LITTLE BIT FOR US AND LET'S NOT TALK ACCOUNTING PRINCIPLES AND GET.

YEAH, I PROMISE I WOULD NOT BE OFFENDED.

SO WHAT WAS EMAILED TO YOU AND I'M ASSUMING YOU ALL HAVE AN EMAIL COPY WAS BASICALLY TWO DOCUMENTS.

ONE IS THE ACTUAL REPORT ITSELF AND ONE IS A SMALLER THREE PAGE VERSION OF A DOCUMENT THAT JUST AS A MATTER OF PRACTICE, I'VE GOT KIND OF HAVE TO GO THROUGH THERE. BUT THERE ARE GOING TO BE, YOU KNOW, A HANDFUL OF GOOD POINTS IN THERE THAT I HOPE GET YOU TO START THINKING ABOUT.

HEY, WHAT HOW IS THIS GOING TO AFFECT THE ACTUAL AUDIT REPORT AND THE NUMBERS BEING PRESENTED? SO I'M GOING TO START WITH THE THE SMALLER DOCUMENT, AND IT'S CALLED THE GOVERNANCE LETTER.

I WILL. I'LL SPEAK TO IT, THOUGH.

UM, AGAIN, JUST JUST CONFIRMING WHY WE'RE HERE.

WE'RE HERE TO DISCUSS AUDIT FOR THE YEAR ENDED SEPTEMBER 30TH, 2022.

ALSO CONFIRMING THAT THAT THE AUDIT IN TERMS OF THE ROLE THAT WE PLAY IN THIS PROCESS IS PERFORMED UNDER GOVERNMENT AUDITING STANDARDS.

AGAIN, THAT'S ACCOUNTING SPEAK TO SOME REGARDS, BUT I JUST WANT YOU TO KNOW THE STANDARDS FOR WHICH WE NEED TO CONDUCT THE AUDIT, WHICH IS A HIGHER LEVEL THAN, SAY, IF YOU SAW AN AUDIT OF A NONPROFIT THAT DIDN'T HAVE GOVERNMENT RELATED FUNDS AND THINGS OF THAT NATURE.

SO WE ARE HELD TO TO A HIGHER STANDARD IN THAT REGARD.

AND THEN THERE'S A SECTION CALLED SIGNIFICANT AUDIT MATTERS, AND HE SPEAKS TO MANAGEMENT'S RESPONSIBILITY.

A LOT OF FOLKS THINK THAT THE AUDIT REPORT ITSELF IS OURS.

OUR OBJECTIVE IS TO AUDIT THE REPORT, NOT TO NECESSARILY PREPARE THE REPORT.

IN FACT, THE ACTUAL REPORT ITSELF WAS ACTUALLY PREPARED BY CITY STAFF.

CERTAINLY THERE WAS A LOT OF BACK AND FORTH BECAUSE THERE ARE SOME THINGS THAT WE SAW THAT WEREN'T CORRECT.

BUT AT THE END OF THE DAY, IT'S MANAGEMENT'S RESPONSIBILITY.

UM, I WANTED TO MENTION THAT JUST.

JUST SO YOU KNOW.

YOU KNOW, OUR.

OUR PROFESSION IS EVOLVING, JUST LIKE EVERYBODY'S PROFESSION.

AND THERE'S, YOU KNOW, THERE'S ALWAYS SOMEBODY NEW YORK THAT THINKS WE GOT TO MAKE IT MORE DIFFICULT THAN IT HAS TO BE.

AND SO IF IF YOU EVER HAD AN AUDIO PRESENTATION THIS PAST YEAR, YOU MAY HAVE NOTICED OR MAYBE THEY MENTIONED ABOUT A NEW LEASE STANDARD ACCOUNTING FOR LEASES, THAT'S A BIG THING.

AND AND NOT ONLY IN THE FOR PROFIT WORLD, BUT NONPROFIT WORLD AND GOVERNMENTAL.

BUT JUST TO ACKNOWLEDGE THAT THERE IS A NEW STANDARD IN THIS PARTICULAR YEAR.

THE SILVER LINING IS IN YOUR CASE, IT'S NOT SIGNIFICANT ENOUGH FOR US TO EVEN CONSIDER, BUT WE JUST NEED FOR YOU ALL TO BE AWARE THAT LEASES ARE THERE IS A LEASE STANDARD.

TO THE EXTENT THAT YOU GET INTO SOMETHING IN THE FUTURE THAT IS SIGNIFICANT.

ALSO, JUST ACKNOWLEDGING THAT AS MUCH AS IN EVERY AUDIT REPORT AND EVERY ACCOUNTING DEBITS EQUAL CREDITS AND SO THAT SEEMS LIKE A SCIENCE THEY SHOULD ALWAYS AGREE.

THERE ARE ESTIMATES ASSOCIATED WITH SOME OF YOUR NUMBERS.

AND SO LET'S TALK ABOUT THE BIGGER ESTIMATES IN ANY AUDIT REPORT AND REALLY SPECIFICALLY AS IT PERTAINS TO YOUR AUDIT REPORT.

ONE IS MANAGEMENT'S ESTIMATE OF THE COLLECTIBILITY OF NOTES RECEIVABLE WITH YOUR BIGGEST NOTES RECEIVABLE BEING THE SANTANA TEXTILES RECEIVABLE.

BUT JUST DON'T FORGET THAT THE FOOTNOTES IN THE BACK THERE ARE IMPORTANT.

IF YOU EVER HAVE A CHANCE, YOU KNOW, WHEN YOU HAVE NOTHING TO DO BUT TO READ AN AUDIT REPORT, THEY ARE IMPORTANT.

[04:10:01]

IT'S GOOD INFORMATION BACK THERE.

AND SO PLEASE DON'T DON'T DON'T EVER IGNORE THEM.

OKAY. I WANT TO TURN THE PAGE AND I'M GOING TO TALK TO THE FIRST POINT.

THAT'S ON THERE AND IT SAYS DIFFICULTIES ENCOUNTERED IN PERFORMING THE AUDIT.

SO IT'S NOT IT'S NOT A GOOD PRACTICE TO HAVE A SEPTEMBER 30TH, 2022 AUDIT REPORT PRESENTED TO YOU IN AUGUST.

I THINK, GENERALLY SPEAKING, YOU DON'T HAVE TO BE AN ACCOUNTANT, YOU KNOW, TO TO TO KNOW THAT.

AND FOR THOSE THAT ARE NOT FAMILIAR WITH THE AUDIT PROCESS, SOMETIMES, YOU KNOW, IT'S THE AUDITOR'S FAULT, YOU KNOW.

WELL, THEY DIDN'T GET THEY DIDN'T GET THE OPPORTUNITY TO TO THEY DIDN'T THEY DIDN'T THEY DIDN'T DO THEIR JOB.

MANAGEMENT WAS UNABLE TO PROVIDE A TRIAL BALANCE TO US UNTIL APRIL 14TH, 2023.

WHY ARE WE WHY ARE WE STILL TALKING ABOUT THIS IN AUGUST? WELL, ONCE WE GOT THE TRIAL BALANCE, WE STILL NEEDED INFORMATION TO AUDIT, RIGHT? WE ONLY AUDIT WHAT THE CITY CAN PROVIDE.

AND IT TOOK THAT LONG IN ORDER FOR US TO BE ABLE TO COMPLETE THE AUDIT.

AND SO, FOR EXAMPLE, I MENTIONED AND I JUST THIS IS AN EXAMPLE I MENTIONED THE CITY IS RESPONSIBLE FOR PREPARING THE AUDIT.

THEY THEY SENT US A DRAFT, THEIR FIRST ITERATION OF THE DRAFT ABOUT FOUR WEEKS AGO.

AND ADMITTEDLY, I THINK THEY WOULD AGREE IT WAS NOT IN GOOD SHAPE.

AND SO WE SENT THEM BACK ALMOST AN ENTIRE NEW REPORT AND JUST TOOK THEM THAT LONG TO GET US SOMETHING THAT WE COULD WORK WITH.

THAT'S A NORMAL PART OF THE PROCESS, BUT IT'S NOT NORMAL TO BE HERE DURING THIS TIME.

AND SO I JUST WANTED TO TO ACKNOWLEDGE THAT AND KNOW THAT WE AS SERVICE PROVIDERS ARE ALWAYS INTERESTED IN MAKING SURE THAT YOU GET SOMETHING TIMELY.

OKAY. DOES ANYBODY HAVE A QUESTION ABOUT THAT POINT? JUST FOR CLARITY AND FOR US ON THE BOARD.

SO LAST YEAR DURING THAT TIME THAT YOU NOTED, WE WERE PAYING THE CITY.

FOR THIS FOR AUDITING AND ACCOUNTING, IS THAT CORRECT? YES. SO SO WE WERE WE WERE PAYING THE CITY.

AND YOU FAILED TO GET THE PROPER INFORMATION THAT YOU NEEDED.

OBVIOUSLY, IF YOU'RE GETTING IT IN APRIL OR FOUR WEEKS AGO, WE'RE DELAYED SO THAT WE KNOW THAT.

AND WHAT WHAT CONVERSATIONS DO WE HAVE WITH WITH WITH CITY COUNTY STAFF OR WHAT HAVE YOU? WELL, THEY WERE ALSO CONDUCTING THE CITY AUDIT AT THE SAME TIME.

WELL, THAT'S A WHOLE DIFFERENT I'M MORE CONCERNED ABOUT THE EDC AUDIT BECAUSE THAT'S WHAT WE'RE PAYING FOR, RIGHT? NOT NOT THE CITY AUDIT.

WELL, THEY WERE AWARE THAT WE WANTED THE AUDIT DONE.

OKAY. WE PAID FOR.

I MEAN, WE PAID OUR WE PAID FEES, RIGHT? YES. ALL RIGHT.

YES, WE HAVE PAID.

AND I KNOW THAT AND CORRECT ME IF I'M WRONG, I THINK EVEN GETTING SOME REPORTS.

YEAH, EXACTLY.

YEAH. I MEAN, IT DOESN'T HAVE TO BE HOUSE.

I MEAN, IT DOESN'T MATTER WHAT EVERYBODY VOTES.

BUT ARE YOU GOING TO BE MOVE IT DOWN THE ROAD? SURE. MAYBE NOW I'M PUTTING CLEAR FIELDS.

IT WASN'T ME. CARLOS, I'M GOING TO SEND CHAIR.

THING IS LIKE I'M GOING TO RESCIND ON THE FIELD BEFORE WE GET.

THEY HAVE. I'M.

I'M FEELING LIKE LA LLORONA RIGHT NOW.

OKAY. ALL RIGHT.

IT'S 942 AND WE ARE RETURNING FROM EXECUTIVE SESSION.

CAN WE GET A MOTION TO ENTER INTO OPEN SESSION? MAKE A MOTION. OKAY.

MOTION SECOND.

SECOND. ALL IN FAVOR.

SAY RAISE YOUR RIGHT HAND.

OKAY. WE ARE NOW IN OPEN SESSION.

[F. DiscussandconsiderapprovaloftheEdinburgEconomicDevelopmentCorporation'sPersonnel Compensation Plan for Fiscal Year 2023-2024.]

UM, IF WE GO TO YOUR BACK TO ITEM SIX.

[04:15:01]

F. DISCUSS AND CONSIDER APPROVAL OF THE EDINBURG ECONOMIC DEVELOPMENT CORPORATION'S PERSONNEL COMPENSATION PLAN FOR FISCAL YEAR 2324.

A. AS DISCUSSED.

CAN WE GET A MOTION TO APPROVE ITEM F WITH THE CAVEAT THAT THE CHAIR WILL APPOINT AN AD HOC COMMITTEE CONSISTING OF THREE? MEMBERS TO SERVE IN AN ADVISORY CAPACITY ONLY ON THE HIRING OF THE INTERNATIONAL BUSINESS DEVELOPMENT MANAGER.

[G. ConsiderandapprovetheFY24StaffingServicesAgreementbetweentheCityofEdinburgand Edinburg Economic Development Corporation.]

SO MOVED SECOND.

OKAY. ALL IN FAVOR SAY AYE.