Updates on the Fight for Quality Public Education in Brevard County, FL
0:00 » I pledge allegiance to the flag of the United States of
0:05 America and
0:05 to the republic for which it stands, one nation under God,
0:10 indivisible, with liberty and justice for all.
0:13 [BLANK_AUDIO]
0:30 » [INAUDIBLE]
1:00 [BLANK_AUDIO]
1:23 » Just so you guys know what the previous offsite items,
1:25 that’s gonna be where our three policies that we’re gonna
1:28 discuss in the woods.
1:29 We also have a big situation in the public speaking studio.
1:33 So moving forward on today’s agenda, we have Ford and Associates
1:36 presentation.
1:37 Welcome Mr. John Ford, we appreciate you.
1:39 » Thank you very much.
1:40 » I’m going to use the microphone here.
1:42 » Thank you.
1:43 » Okay, my name is John Ford.
1:46 With me today is my colleague Barbara Kami Betsy,
1:48 Ford and Associates services, the School Board of Municipal
1:51 Advisors.
1:51 And I just wanted to thank you for having me here today.
1:55 I’ve got tax anticipation on this.
1:58 For Bard schools is, like the other 66 districts in the state,
2:01 funded through the Board of Education finance program.
2:04 And amongst other things, what that program does, and
2:07 then to guarantee peak substantially equal access to programs
2:10 and services.
2:11 It allocates funding on per student basis for each of the board’s
2:15 67 counties.
2:16 And it assigns an allocation of where that funding can come from.
2:19 A portion can come from local property taxes, called required
2:22 local effort.
2:23 And a portion can come from state sales tax offers.
2:25 And those checks, importantly, arrive every month.
2:28 The property taxes, as you already know, arrive essentially in
2:31 the month of December.
2:32 This starts up in the month of December.
2:35 And that has big implications for cash flow.
2:38 And it’s important to know that in fiscal 2026, which we just
2:41 wrapped up,
2:41 the Bard public schools general fund generated 46% of its
2:45 revenue
2:46 from local property taxes.
2:47 [COUGH] Around the state, this is sort of how you compare.
2:51 This chart shows the relative mix of property tax funding,
2:55 which is above the horizontal axis, versus state funding, below
2:59 the, excuse me.
3:01 Property taxes are above the horizontal axis, and
3:06 state funding is below the horizontal axis.
3:09 Generally speaking, the more a district relies on local funding,
3:15 the more drastic its cash flow will change during the year.
3:20 I’ll show you what I mean by that in just a minute.
3:23 What we’re showing you here in the yellow bars, by the way,
3:25 is over operating images.
3:27 And as you can see, those do exacerbate the divide from many
3:31 districts
3:32 between state funding and local funding.
3:35 So why is this important?
3:37 Well, this chart simply shows you general funding of the season
3:40 dispersions
3:41 during the year.
3:42 And I wanna start by talking about the red bars below the axis.
3:45 And these are descriptions for Bard schools, like most other
3:48 districts,
3:48 has relatively level expenditures throughout the year.
3:52 You’ve got a slight shallow expenditure in July cuz you’re still
3:55 in summer, and
3:55 it’s like the bigger one in June cuz you’re paying out the
3:58 preparation at four.
3:59 And it’s pretty even through the year.
4:01 In addition, the dark blue bars, which are fairly small,
4:04 these are receipts from the state.
4:05 These come in at almost a pool amount every single month of the
4:08 year.
4:08 This is great cash flow.
4:10 If you’re a district that’s 90% reliable on these state dollars,
4:13 you’ve got very equal income throughout the year.
4:16 That’s not the case in the fall.
4:18 46% of our income last year came in at a gigantic spike,
4:22 which you see in the northern chart of the assembly.
4:26 What that means is that we are running an operational deficit.
4:30 In the 11 months of our fiscal year, we have one surplus month.
4:34 That is unfortunately not the usual, and it has great impacts.
4:37 It’s chaotic.
4:37 We think in general, greater fund balance is important because
4:41 you are going to draw
4:41 it down each and every month until the month of December.
4:45 This is what the cash position looks like as a result.
4:48 And we don’t have the June 30th number starting up here.
4:51 But the year-end numbers, the year-end numbers for July as you
4:55 can see fall.
4:56 It’s through August.
4:58 Fall again in September.
4:59 Our general fund actually showed a negative balance last year
5:02 as early as September, even in October.
5:05 The deficit even to over $80 million in November.
5:09 And in December, that huge inflow of property tax money replenished
5:14 the coffers.
5:15 And we survive on that money while we run these monthly deficits
5:19 until the following fall,
5:20 which is where we are right now.
5:23 So why is this?
5:24 Well, first of all, we’ve talked about the division.
5:27 And it’s important to note that over the last several years,
5:30 Florida school districts on average have become more defined on
5:33 local property taxes.
5:35 That’s exacerbated by local operating notices.
5:37 When you put a village in place, you bring in more revenue.
5:41 It might get you to a dozen people to increase expenditures, but
5:45 you have to wait for that money.
5:46 So it’s even as that whole limit has fallen.
5:49 And then finally, charter schools.
5:51 You’re required to share money with charter schools.
5:54 And first and actually, you’re required to share that money with
5:57 them on an equal monthly basis
5:59 without regard to your own time and your expenses.
6:02 In other words, you have to apply for your own revenues.
6:05 That sucks.
6:06 You are acting as a mandated liquidity facility for charter
6:12 schools.
6:13 The answer to this is tax anticipation notes.
6:16 I think that we have for the most part discussed this before,
6:19 but there is a statute in Florida that lets you take out a short-term
6:22 borrowing that will bridge this gap.
6:24 Take out a note now, you agree to pay it back somewhere between
6:28 now and June 30th,
6:31 and gets you through that low point that essentially just puts
6:33 additional operating money
6:35 in your account for a temporary period of time that those
6:38 secured by future property tax revenues can repay.
6:43 Unlike your capital dollars, TANF can be a bit unusual because
6:47 if you invest these funds,
6:49 which you will, it will also keep you from liquidating certain
6:53 investments in other funds, say capital.
6:56 If the yield on your investments exceeds the cost on your bonds,
7:00 unusually, you actually keep that money.
7:02 So we’re hoping in certain cases where the TANF is a larger size,
7:05 we’ll actually make enough to offset the cost.
7:08 That’s a projection, it’s a hope.
7:12 It’s not something that liquidating would guarantee, but I think
7:16 it’s probably the case for that.
7:19 This is the more detailed look at your cash flow from last year.
7:23 We began July with about $41 million in the bank.
7:28 We ended the fiscal year with about $39 million in the bank.
7:31 That’s not a big change over the year.
7:34 The point is, is that by the end of November, we were $84
7:38 million under water in the general fund.
7:40 That’s because of the structural timing of local property taxes
7:45 versus state funds.
7:47 So it’s just the fact that your expenditures are monthly, your
7:52 revenues not so much.
7:54 And with that, I’m going to turn it over to, and yes, people
7:57 will walk you through the
7:58 discussion that we get from bank loans and the responses we get
8:02 from bank loans.
8:03 So now that the district has determined that it has the need for
8:07 a TANF, a few weeks ago,
8:09 we were in the district to publish a solicitation for a bank
8:13 loan TANF, which we referred to as
8:15 an invitation to negotiate for an ITN.
8:17 And last Friday, we received four strong bids from Bank of
8:21 America, Pine Point Bank, PNC, and Wells Fargo.
8:26 As part of these proposals, all four banks submitted indicative
8:29 interest rates.
8:30 And what we mean by indicative is that this is their best idea
8:34 of what the interest rate
8:35 would be at the time that they submit the proposal.
8:38 So this is subject to change.
8:41 And usually, this interest rate is locked a few days before
8:45 closing.
8:46 Something to keep in mind, interest rates have been increasing
8:48 over the last couple of weeks and days,
8:50 in the geopolitical events around 6 basis points since last week
8:56 and around 0.5 basis points on the month.
8:59 Despite that, the bids we received have been very strong, and
9:03 the one with the lowest interest
9:05 rate from Wells Fargo is actually the lowest bid from Wells
9:08 Fargo across all districts
9:09 that we have seen during the scant season, so that’s very
9:13 beneficial for the district.
9:15 So with these indicative interest rates, Wells Fargo submitted
9:18 the lowest at 3.46%.
9:20 However, when we look at the overall cost of the bank, we can’t
9:23 just look at these interest rates,
9:24 we also have to look at closing costs.
9:26 So what is customary in Florida for bank loan plans is that the
9:29 bank passes on the cost
9:31 of their bank legal counsel, and across all four banks, these
9:35 were relatively in line
9:37 with market and relatively low.
9:39 However, one bank does stand out with higher corporate costs,
9:42 and that is Pine Point Bank.
9:44 They are putting up a commitment fee, which is, as you can see,
9:49 higher.
9:51 And when we factor in closing costs and that interest rate, we
9:54 arrive at an estimated all
9:56 interest rate, and again, Wells Fargo comes in as the winner
10:00 here with all interest rates
10:03 of just over 3.5%.
10:05 That is very unmarked, and that is a very strong proposal from
10:08 them on that part.
10:09 Now we can’t just look at the closing costs and interest rate
10:12 when evaluating which proposals
10:14 we perceive, we also have to look at some of the other terms and
10:17 conditions, and some
10:18 of those key terms and conditions are pre-payment provisions,
10:22 rate adjustment provisions, default
10:24 rates, and other terms and conditions.
10:28 When we look at first, pre-payment provisions, these aren’t
10:32 incredibly relevant to TANs, simply
10:34 because this is a loan that is maturing in April of next year,
10:37 so these aren’t terribly
10:38 important to us.
10:39 Now when we look at rate adjustment provisions, we are looking
10:43 at, in the event that the TAN
10:45 becomes taxable, so backpedaling a little bit, the tax
10:49 anticipation note that Brevard
10:51 will be issuing is tax exempt.
10:52 That means that the investor, the bank purchasing the TAN, does
10:56 not pay income tax on the interest
10:57 earnings from the TAN, and that translates to significant
11:00 interest rate savings for a
11:02 district.
11:03 But if the district were to do something that the IRS does not
11:06 like, then the IRS will return
11:07 the TAN to be taxable, and the district will be on the hook to
11:12 pay that additional interest
11:14 that the bank is owed.
11:16 So B of A and PNC Bank both came in with those provisions.
11:21 Huntington did not address it, and most part, we did not address
11:24 it either, but looking
11:25 at previous bank loan proposals that Marko has come in with, we
11:28 assume that their provisions
11:30 will be fairly similar to the ones submitted in B of A’s and PNC’s
11:34 proposals.
11:35 We’re hoping to break it from out there.
11:38 Not only does Wells Fargo in this case appear to give us the
11:41 best pricing, but they also
11:42 appear to give us the best terms and conditions.
11:44 We’re very comfortable with that because we have worked with
11:47 Wells Fargo already this
11:48 year in two or three other school districts using documents that
11:51 we’ve used in another
11:52 district for the past three years, so they’re heavily negotiated,
11:55 and we believe that they
11:57 will be substantially identical to those documents, so we’re
12:00 very, very comfortable with that.
12:02 It’s nice when the pricing and the terms and conditions line up
12:04 and we have one source
12:06 here that’s involved.
12:09 The proposed stand borrowing amount here is $100 million.
12:12 We anticipate closing on or about the 25th, ensuring on April 1st
12:17 of next year.
12:18 The indicative interest rate is $346, which is probably a little
12:22 higher than that now.
12:24 We haven’t gotten a refresh, you can’t really see it.
12:26 Issuance expenses are estimated to be a little under $53,000.
12:30 At the end of the day, keeping in mind that this will allow monies
12:34 from the capital and
12:35 eventually the general funds to remain invested and assuming
12:38 they stay invested, about the
12:39 current yield that Florida Prime is offering, about 387, we
12:42 think that the net overall cost
12:44 of the district this year is going to be negative.
12:47 In other words, you will benefit by about $40,000.
12:50 I would go ahead and encourage you to consider that at break
12:52 even because it can be the interest
12:54 rate that’s gone up some and there’s no reason to count that
12:57 before we hatch.
12:58 So we don’t think that this is going to cost the district a
13:00 whole lot this year.
13:01 Most of that has to do with the size of the loan, we have to
13:04 look at interest funds and
13:05 see if they’re any personal.
13:07 So we will pause there and take any questions.
13:10 Anybody have any questions?
13:11 » Can you back up the slide?
13:12 » Yes, ma’am.
13:14 » You mentioned the payment not really being extremely
13:18 important because of the timing,
13:20 you know, that means the payback.
13:22 But anyway, the tax ability seems like that’s probably not
13:26 something that people would (inaudible)
13:32 » There are two different things that we’re concerned about
13:35 with tax ability.
13:36 Just in general, this means in any event, we’re concerned that
13:40 any event in which the
13:41 lender gets to increase your interest rate.
13:44 And we’re especially interested in that if it’s for something
13:46 that’s completely outside
13:47 of your mutual.
13:49 So we’re more or less philosophically okay with saying that if
13:51 the school district screws
13:53 up, there’s some fairness to that, even though it’s not ideal.
13:59 But if the federal government comes through and says tax
14:02 exemption is no longer a thing,
14:04 and the bank says okay, we don’t like that, that’s a bond, we’re
14:08 going to risk working
14:09 for the bank, I feel very different, but I’m not working for you.
14:12 So the federal government does not love tax exemption.
14:21 And while I don’t think that anything will happen during the
14:25 life of this hand, it is
14:26 my personal, not a firm position, it’s my personal belief that
14:30 eventually we will lose
14:32 at least some ability to finance things on a tax-free basis.
14:36 I don’t know if that will just be non-profits or cover all local
14:39 governments.
14:40 But eventually that will happen because you have a disability at
14:44 the federal level.
14:45 Any other questions?
14:47 I’m just going to say in regards to this, obviously I’ve been
14:51 very vocal about debt,
14:52 and the way our cash flow comes in, it’s a bit of a nuance,
14:55 right?
14:56 Because we see that it’s great that we’re halfway being funded
14:59 locally, but the downside
15:01 to that is that we don’t get that money until one infusion a
15:04 year.
15:04 And this is just asking, I don’t know how to answer these
15:07 questions, I’m going to ask
15:08 it.
15:09 Are there any districts on the state, or is there any way to
15:12 talk to our tax collector
15:13 on disbursing money in a different mannerism than just the one
15:16 time that they hit us with
15:17 that in December?
15:18 I would strongly encourage you to do that.
15:20 I haven’t yet to see a district that’s had a great deal of
15:24 success with that.
15:25 We’ve had certain tax collectors fund a little bit of money a
15:29 little bit earlier, but they
15:32 don’t receive the money largely until November, so the systems
15:36 and probably the tax collector
15:38 can make it pay up quickly to turn it over to you.
15:40 Some counties are slower than others.
15:43 What you really need to do is go out and there’s all these
15:46 systems, everything you can see,
15:49 so that if you and I are a mortgage fan in the escrow, they
15:51 immediately go to the tax
15:52 collector and they’ll just send some stupid account or interest
15:55 or something that’s not
15:56 being talked to.
15:58 Never by the paper tax, but there are times of the year of being
16:01 here, right?
16:01 We put it in the escrow.
16:03 And so we’ve never had a tan, at least not in my tenure, and
16:09 that’s because we are financing
16:11 our own financing using capital dollars, other funds, which
16:15 means that if Sue has a gigantic
16:17 project and it’s that November time of year, then she might have
16:22 to slow down.
16:23 So that right, we are financing, basically doing our own thing
16:27 with our own money.
16:28 It can affect us if we have, if we have people having the time
16:32 when things are paid, right?
16:34 That’s completely accurate.
16:35 I usually refer to this because you’re taking money that would
16:38 otherwise be sitting at an
16:40 investment, certain 387, and you’re using that to blow the gap
16:44 or you can run the market
16:45 through ARVID for what is hopefully less than half an hour or
16:48 less.
16:48 In this case, we think it’s a little bit less than that.
16:50 So this is, by the age of it, there is a better option.
16:54 Mr. Chairman, I was just curious, from the consumer, Kevin, are
16:58 you aware of any kind
16:58 of time that this has appeared on our legislative agenda because
17:01 the state has reelected how
17:02 they deal with this?
17:04 I don’t think that our district has ever put that off the
17:07 legislative agenda.
17:08 We certainly do that.
17:10 I think the chances of us changing that is very slim.
17:14 Part of what the report says is the county doesn’t get the taxes
17:17 and so on.
17:18 Right.
17:20 I think the one thing that I always say in this discussion is
17:35 that if you do attend at
17:40 the right time, you actually are not in that part of the
17:43 agreement.
17:44 I don’t know if that’s what you’re talking about, but I think it’s
17:54 a good thing.
17:56 I think it’s a good thing.
47:43 So here’s the plan that we’ve been working with with our
47:47 neighbor associations.
47:53 The plan that we have is obviously the current gold plan and the
47:59 current silver plan, and then this is a new plan, one with an HRAC,
48:04 one without an HRAC.
48:05 There is some increase.
48:10 It’s a cost loss really, so if we do this HRAC, so let’s just
48:20 say $500 per single, so you’re deductible for an individual is $2,000,
48:27 so minus the $500, so you could use that $500 HRAC to buy down
48:30 that $2,000 deductible.
48:32 So that’s the idea of the clinic.
48:55 So yes, it shows that all your wellness is going up right on the
48:58 higher end.
48:58 If you use the clinics that we’re building and we’re looking for
49:02 them, if you use them, it’s a zero cost to you.
49:04 The pharmacy is zero cost, the visit is zero cost, so you’re
49:08 never going to touch your wellness or your senior deductible.
49:11 But there is a cost to the insurer to be a part of that plan to
49:15 get access to this plan.
49:17 So yeah, we have monthly payments still.
49:20 That’s your key to get in the door.
49:31 So this gets rid of gold and silver, so now people can pick
49:57 health first.
49:58 Yes, however, we’re pushing it to the clinics, so if you want to
50:05 go to your family doctorate, you’ve been there forever, fine,
50:08 but then you have to duck.
50:11 So that’s a decision I’m going to need from the board.
50:19 I’m going to kind of show you the costs on that.
50:33 So this is the cost of what we’re currently doing and what it’s
51:02 going to cost.
51:02 Remember, I ended the district for 2027.
51:07 As you can see down here, employee costs are about 19 million,
51:13 employer costs about 73 million.
51:17 However, remember I told you we’re short 7 million, so it
51:20 actually cost us this year about 80 million, and we’re expecting
51:25 it to be these costs here line by line.
51:28 This is 2026 current, this is next year rate, so then you can
51:35 see the projected cost at the bottom, the increase.
51:41 So they’re still saying, even with this, expect to stay at 80
51:46 million, but then also on top of that, 2.3 percent, which is
51:49 about 1.8 million more.
51:50 For us, there’s also an 11.6 percent increase in employees, is
51:55 that correct?
51:56 So that’s the 2.2, yes.
52:00 That’s without the HR.
52:02 Without HR.
52:04 No, that’s with the HR.
52:06 Their premiums are increasing, because here’s the problem.
52:08 We had gold and silver.
52:12 Golds are not changing, I believe, and silver is the one that’s
52:17 going up, that’s just my math.
52:19 [inaudible]
52:33 So for gold, everybody’s basically getting moved to the gold
52:36 current rate.
52:37 So those on gold are not going to see any increase, those on
52:40 silver are going to see an increase.
52:41 And that’s over half of our employees.
52:45 And again, we’re negotiating this with our labor unions, this
52:49 isn’t set in stone.
52:50 I need it to be pretty quickly, though, because open enrollment
52:54 is around the corner, and we’re going to need to get more
52:57 direction on the HRAC.
52:58 Without HRAC, we’re going to need to finalize this with the
53:01 labor unions.
53:02 We’re going to need to get communication out, because this is a
53:06 pretty big plan change.
53:07 You’ll also see on this, right here, I talk about the deductibles,
53:11 wellness, non-wellness.
53:12 Everyone for the first year is going to be on the wellness plan,
53:15 just because we’re going to ask them to do things that they’re
53:18 not expecting.
53:19 So I can’t hold it against you for not having it done by January
53:22 1st.
53:22 Makes sense? I’m going to give you a full year.
53:24 So for the next year, you either get your points to be on the
53:27 wellness or you don’t, and that’s going to be your ramifications.
53:29 The idea is, obviously, we want people to be healthy, right?
53:33 So the healthier you are, the less you feel the doctor, the less
53:35 our insurance plan costs.
53:36 You’re dealing with things like having your waist below 40%, and
53:40 you’ve got your HDL levels right, and you go see a doctor.
53:44 Like, endometrical blood pressure medicine is good, things of
53:48 that nature.
53:49 And that’s where the clinics will come in.
53:51 That’s where the clinics will come in.
53:52 And the clinics will go ahead.
53:53 Correct, at zero cost. At zero cost.
53:57 So, again, this is without HRA.
54:03 I’m recommending that we do not do the HRA because it’s going to
54:08 add another $5 million to our cost, the district side, to do
54:14 that.
54:15 And we’re already going to be, you know, going to see about a $13
54:21 million deficit without the $9 million deficit from our current
54:26 funding levels.
54:28 (inaudible)
54:35 Yes.
54:36 (inaudible)
55:01 Remaining that.
55:16 These are getting complete numbers, and this is what they’re
55:21 telling me we have to do.
55:23 So, again, the status quo.
55:25 This is another chart kind of depicting everything, the status
55:28 quo.
55:28 We don’t do anything.
55:29 We’re going to be at $15 million more.
55:32 We do this new plan with the HRA seed.
55:34 We cost about $13 million for the district, and gold will be
55:39 about a $9 million deficit.
55:41 Remember, we’re funded right now about $73 million.
55:43 We’ve got to infuse another $7 million, $8 million this year,
55:46 and there’s going to be another $1.7 million on top of that next
55:51 year.
55:52 What’s our projected savings?
55:55 So, the objectives I had them run all of our claims this year
55:59 through the clinic model and what we did in about a $4.5 million
56:03 savings.
56:04 So, I think I have that somewhere coming up.
56:12 (inaudible)
56:32 This is very concerning.
56:35 No, and I get it. I mean, obviously, the benefit of the HRA is,
56:43 you know, for our predominantly healthy people who don’t go very
56:44 much, they’re going to use it on the very few things you use it
56:46 on.
56:46 Of course, you know, wellness is for free and whatever the few
56:49 times they have to go in, they’re going to end up with still a
56:52 couple hundred dollars of family, maybe hundreds of dollars left
56:55 over.
56:55 That comes back to the district and all the good stuff.
56:57 And then the people who are, you know, have an emergency or have
57:00 a need, have a baby, have whatever, they’ll use all that and
57:04 that brings down the positive and higher deductible now that we’re
57:07 charging everybody.
57:08 Because you can’t have a, you know, you can’t have a baby. You
57:11 can’t have whatever through the clinics.
57:14 (inaudible)
1:00:31 And I actually was on a call, I don’t have it on here, I was
1:00:33 hoping to have it before this presentation but it never came.
1:00:36 I was on a call last week and I got a map of kind of where our
1:00:40 people are at in the county because we’re trying to right now
1:00:44 secure the buildings and get that contract up and running.
1:00:47 So I wanted to know kind of the best way to, where to put these
1:00:50 strategically.
1:00:51 We’re only going to be able to have four to start off with so
1:00:54 obviously we’re going to have one in the north by Titusville
1:00:57 area.
1:00:57 We’re going to have one in Palm Bay area. There’s a big heat map
1:01:01 of people in Viera Rockledge area.
1:01:05 It’s not going to be feasible for us to go across the causeway
1:01:09 so I asked them to kind of focus to get beachside people.
1:01:12 However, we don’t have a whole lot of people that live actually
1:01:15 beachside. That number is actually pretty low.
1:01:17 But for those types of people and also kind of how to offset the
1:01:20 Rockledge Viera, I asked like the base of the O’Gally Bridge
1:01:24 land side.
1:01:24 That way it’s kind of a central point for, you know, the
1:01:29 Atlantic, O’Gally area, you know, try to get people inside to go.
1:01:34 [Inaudible]
1:03:41 So this is kind of, kind of give you an idea of what happens.
1:03:47 This is just really just another slide depicting the same
1:03:50 information.
1:03:51 It does close the gap and not all of it in 2027. Again, I showed
1:03:58 you the examples with HRAC and without HRAC.
1:04:01 Cost of the district. So some of the concerns I have that I’m
1:04:12 really trying to shore up before we get this done is our health
1:04:17 care costs are under a new vendor.
1:04:17 Marathon runs three clinics right now at about $3.6 million a
1:04:22 year is what it costs us to have those marathon sites.
1:04:25 We’re going to move the people one again with about four sites.
1:04:29 That’s expected to be at about $7.9 million cost.
1:04:32 Marsh is kind of our consultant with the clinics and they’re
1:04:36 stating a savings of about $12 million savings by moving to the
1:04:40 clinic model.
1:04:41 So it’s going to cost us $7.9 million but it’s going to save us
1:04:43 $12.4 million.
1:04:44 Annually, correct?
1:04:46 Yes.
1:05:02 Second rule there is clinic site locations and readiness. I’m
1:05:07 extremely concerned.
1:05:09 That’s not going to happen.
1:05:11 It’s not going to happen.
1:05:22 It’s not my job to do. But it’s my job to be the barking dog and
1:05:27 I do that very well.
1:05:28 And we’re about to go to – I meet with them every week.
1:05:31 We’re about to go there twice a week.
1:05:33 Because I am not comfortable – again, I don’t do this for a
1:05:36 living.
1:05:37 I don’t do the clinics and staff them up and do all – I don’t
1:05:40 do that for a living.
1:05:41 I just know how things work.
1:05:43 It’s hard for me to believe that that’s going to happen.
1:05:45 I’m fine. It’s going to be ready. It’s going to be ready. It’s
1:05:48 going to be ready.
1:05:48 I would like to start talking about maybe a contingency plan if
1:05:53 it’s not.
1:05:54 But I keep being told you’re fine, you’re fine, you’re fine.
1:05:57 So more to come on that.
1:05:59 I need a job in November so maybe I’ll go work.
1:06:02 So again, if it’s up and running, cool, no problem.
1:06:05 But if it’s not, we have a bigger issue.
1:06:07 Because like I said, we have open enrollment coming, right?
1:06:09 So if I just go through – get ready, we press forward with this
1:06:13 model
1:06:13 and I do open enrollment and I do all that, you know.
1:06:16 Oh, by the way, no, just kidding.
1:06:18 We’re not going to be ready by 1/1.
1:06:20 That’s a concern and I just want to voice it out loud that I’m
1:06:25 aware of it.
1:06:25 I think the board came and presented to the board
1:06:27 and they said it would take nine months to get a clinic off the
1:06:29 ground.
1:06:29 So that’s why I’m like I don’t –
1:06:31 Well, they’re not starting to construct at this point.
1:06:32 We’ve already approved a contract for that one.
1:06:34 We don’t have a building yet to outfit it though for –
1:06:36 They do have some – they do own some buildings.
1:06:38 So they own – I believe they own the Titusville building.
1:06:42 They own the Sierra building.
1:06:44 So I was looking at it, so let’s get those – go on those, right?
1:06:46 So go on those.
1:06:48 There’s two sites in Palm Bay they’re looking at.
1:06:51 And then I told them, again, look, really, I need you to focus
1:06:54 that area
1:06:54 right around the base of the Old Galleon Bridge to –
1:06:57 Ryan, did you know when Mr. Chisholm and I were over there with
1:07:01 Melvin and Palm Bay?
1:07:02 They both had said that they have City Hall space in their city
1:07:06 halls
1:07:06 before I knew the building.
1:07:08 Great.
1:07:09 Most of them before.
1:07:11 So what I would say to you is –
1:07:15 I just want to make sure we’re not going to prompt something.
1:07:17 Sure.
1:07:21 Another concern is the outcome of the Cigna RFP that’s out.
1:07:24 So it’s currently out.
1:07:25 It’s been out since August 31st.
1:07:28 A change in ASO would delay open enrollment.
1:07:31 So we’re going to possibly disrupt provider networks
1:07:33 if we go somewhere besides Cigna.
1:07:35 So if I am – my doctor is a Cigna person, and now I go to
1:07:39 United Health,
1:07:40 and my doctor is now not with – is not with United Health,
1:07:43 now I’ve got to find a doctor that can cover that.
1:07:46 The good news is that that does all happen.
1:07:48 It can kind of – we can line it up to where it disrupts –
1:07:51 where we’re going to be disrupting anyway in January.
1:07:53 We’re going to the clinic model.
1:07:55 So that is the good news.
1:07:57 But I do expect to see some disruption in provider networks
1:08:01 pending the decision of this Cigna RFP.
1:08:05 Fleet is running the RFP.
1:08:06 We are not.
1:08:07 The bar is not.
1:08:08 We would not have been able to get it out and up and running
1:08:11 that quickly.
1:08:12 So Fleet took the forms on that.
1:08:15 So they’re running the RFP.
1:08:17 And then my final thing is, again, just communication.
1:08:21 So implementation timeline with a new ASO, you know,
1:08:24 IV cards, 6,000 seat drivers.
1:08:27 We’ve got to get employee communications on the plan.
1:08:29 We’ve got to get eligibility file fee testing and builds,
1:08:33 provider network selection and confirmation.
1:08:35 There’s some things that my team is really on them about.
1:08:44 Again, the plans are raise the deductibles, not the co-insurance.
1:08:48 So yes, the deductibles do go up.
1:08:50 However, if I push you to a clinic, you’re going to pay no
1:08:53 deductibles.
1:08:53 So it’s zero cost to you having a deductible.
1:08:55 And the same thing with the co-pays.
1:08:57 The co-pays go up for the silver plan people,
1:08:59 but the silver plan people are probably more likely to be using
1:09:02 clinics,
1:09:02 in which case now you’re paying zero.
1:09:04 Zero.
1:09:07 So I was talking earlier about wellness and non-wellness.
1:09:11 This is kind of a snapshot.
1:09:12 I’ve got to get you to seven points, right?
1:09:14 So how do you get seven points?
1:09:16 Real simple, you don’t smoke tobacco, you get three points.
1:09:19 You go to your clinic once here, you get two points.
1:09:21 So now I’ve just got to have you waste under 40 for men, under
1:09:25 35 for females.
1:09:26 And you get CLS.
1:09:27 So get me – you do your five, you need two more points
1:09:29 somewhere around there.
1:09:32 Pretty easy.
1:09:33 Now I will tell you with the tobacco surcharge, there’s a
1:09:36 tobacco surcharge.
1:09:37 I think that’s on my next screen.
1:09:39 And there’s a test for it as well.
1:09:41 So you just can’t say, no, I don’t smoke.
1:09:42 You have to pass a test that proves you don’t smoke.
1:09:46 And if you do smoke, if you do smoke,
1:09:48 you’re doing the smoking sensation classes and you’re doing the
1:09:51 things
1:09:51 that will give you credit for it, because we want people to be
1:09:55 healthy.
1:09:55 Right?
1:09:57 So again, you do your clinic visits and you do biometric
1:10:01 screening
1:10:01 and you get your seven points.
1:10:04 That would be all part of the communication.
1:10:06 I’m just saying we need to give people time to do this
1:10:09 so that everyone on this year’s plan is going to be on a
1:10:12 wellness plan.
1:10:12 And then next year, sorry, 2028, you will decide whether you’re
1:10:17 on the wellness plan.
1:10:17 You decide whether you’re on the wellness or the non-wellness
1:10:20 plan
1:10:20 and you’re going to take care of what you need to take care of.
1:10:26 we can have everybody try to get that in in the first six months
1:10:32 and release the HRA dollars
1:10:34 after six months. We don’t have to release them on Monday.
1:10:39 Well, can I get something out there that we’ve talked that’s
1:10:42 never happened?
1:10:42 But we’ve always said if we ever get to the point in the budget
1:10:46 where we’re running over,
1:10:48 are doing a surplus, the district can say everybody needs a
1:10:51 premium holiday and for the month of May,
1:10:54 we’re not going to deduct your interest. I mean, that would be
1:10:58 an amazing thing.
1:10:58 That would have to be enough.
1:11:00 Because health care costs continue.
1:11:03 But I’m just saying, if we ever end up, you know, and we bright-sized
1:11:10 too much, then we can do it.
1:11:11 [Inaudible]
1:12:39 I’m nervous on our timeframe. We can push. We can push over
1:12:44 enrollment.
1:12:44 But the more we push, the harder it is for me to get the
1:12:47 communications together and get them out to our employees.
1:12:50 We are doing on-site enrollment. So that’s going to help with
1:12:55 our employees so they can ask questions right then and there
1:12:58 of the provider, you know, which one’s best for me. So that’s
1:13:02 going to be good.
1:13:03 [Inaudible]