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2023 10 12 WS MinutesMINUTES OF THE REGULAR WORK SESSION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN October 12, 2023 The City Council of the City of Baytown, Texas, met in a Regular Work Session on Thursday, October 12, 2023, at 5:33 P.M. in the Council Chamber of the Baytown City Hall at 2401 Market Street, Baytown, Texas, with the following in attendance: Laura Alvarado Council Member Sarah Graham Council Member Kenrick Griffith Council Member Heather Betancourth Council Member Jacob Powell Council Member Mike Lester Mayor Pro Tem Brandon Capetillo Mayor Jason Reynolds City Manager Scott Lemond City Attorney Angela Jackson City Clerk John Stringer Sergeant at Arms Mayor Capetillo convened the October 12, 2023, City Council Regular Work Session with a quorum present at 5:33 P.M., and with all members present. 1. CITIZEN COMMENT Mayor Capetillo announced a citizen, Mr. David Isaac, had signed up to speak on the item. Mr. Isaac commented over the fact that, in the near future, there would be someone sitting on the District Four (4) seat to replace Council Member Betancourth. He hoped that person did not have any legal matters they were going through and could present themselves to the voters of the general public. Mr. Isaac suggested there was one such person that has not been public and was going through legal matters. He commented over those legal issues and restated his hope that the replace- ment of Council Member Betancourth was responsible and financially transparent as she was. 2. EXECUTIVE SESSION a. Recess into and conduct an executive session pursuant to Section 551.071 of the Texas Government Code to seek the advice of the City's attorneys regarding pending or contemplated litigation involving the City of Baytown. At 5:36 P.M., Mayor Capetillo recessed and convened in to an Executive Session pursuant to Section 551.071 of the Texas Government Code to seek the advice of the City's attorneys regarding pending or contemplated litigation involving the City of Baytown. City Council Regular Work Session Minutes October 12, 2023 Page 2 of 3 At 6:07 P.M., Mayor Capetillo reconvened the meeting and announced that, in accordance with Section 551.102 of the Texas Government Code, no action was taken in the Executive Session. 3. DISCUSSIONS a. Discuss the City of Baytown FY22 Budget Amendment. Finance Director Teresa McKenzie presented and discussed over the City of Baytown's FY22 Budget Amendment. The following visual was provided as a general overview of the amendment. FUNDING SOURCE FY22 ADOPTED BUDGET PROPOSED BUDGET ADJUSTMENT FY22 TOTAL BUDGET % ADJUSTMENT CHANGE =GOVERNMENTAL FUNDS 166,804,645 (3,019,754) 163,784,891 -1.81°% ENTERPRISE FUNDS 79,478,835 2,599,054 81,077,889 3.31% CAPITAL IMPROVEMENT FUNDS 53,882,812 0 53,882,812 0.00% Cu COMPONENT UNIT FUNDS 37,460,299 0 37,460,299 0.00% SP SPECIAL REVENUE FUNDS 48,546,506 420,700 48,967,207 0.87% TOTAL FUNDING SOURCE $385,173,097 $ 0 $ 385,173,098 0.00% b. Receive the City of Baytown's Comprehensive Annual Financial Report and Single Audit Report for the fiscal year ending September 30, 2022. Finance Director Teresa McKenzie opened the item introducing Auditor Robert Belt with Belt Harris. Mr. Belt presented the City of Baytown's Comprehensive Annual Financial Report and Single Audit Report for the fiscal year ending September 30, 2022, to Council. Mr. Belt provided the following visual to summarize the City's audit engagement over the last ten (10) years. Goal 2023 2022 2011 2020 2019 2018 2017 1016 1015 2014 1013 Fnil Year l_IIII °150- `130 .22 430=1 4lll?ICO V111?nIV 931120I8 VIa?°17 93Y1aIA VJII^°IS 4:3.2nil .30ry10 Fi.1 Year Stan IWIMCm? In 12n21 1.1112. I¢gn°w In L?011, 1111NO III IQ°I. 10'I?n15 10'W011 Inl.?O11 In IMq] Financial stalenrenl issuance dale 3431,2023 In 112a23 611/2022 1192021 I1,2020 1AYIIV 292M 271017 2211nm 212°15 1311013 Days issued a0er ycnr end 366 253 169 158 159 132 130 I47 132 123 A d'I+dj nnrnls u1( (rJl 52 26 42 35 22 17 21 15 19 u....a.....-I,... I,_III -1 1. __ 1; 2 -3 1 -5 -I City Council Regular Work Session Minutes October 12, 2023 Page 3 of 3 Mr. Belt commented that they did make quite a number of adjustments to get the City of Baytown's financial statements correct, sixty-four (64) in total. He walked through each document that was provided to the Council Members by explaining what they entailed. The documents that Mr. Belt described to Council were as follows: an Auditor Disclosure Letter of the conclusions of the audit, a Management Letter, Single Audit Reports, and the Annual Comprehensive Financial Report. After the brief rundown of the documents, City Manager Jason Reynolds wished to comment over the Management Letter. He noted it stated that the City had a material weakness for their 2022 audit with undetected misstatements. Also, the timing of their audit was an issue. Mr. Reynolds assured Council that these would be resolved going forward. Furthermore, they had a piece that was unresolved based off of their 2021 audit. Mr. Reynolds wished to be open with everyone on the FY2022 budget and shared there were three (3) issues they were addressing. He expressed his appreciation to Belt Harris for bringing those issues to light and stated that they would be corrected. C�f171Zf1�1.7\I With there being no further business to discuss, Mayor Capetillo adjourned the October 12, 2023, City Council Regular Work -Session at 6:16 P.M. 4,pYTlJlgra Angela Jackson, City Clerk City of Baytown t;