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staff is aware there is a significant capital requirement in Water and Sewer, but it was late in the game in terms of the budget process and it will be done in subsequent budgets. Councilmember Narum noted she did not see a list of carry-over projects in the CIP and Director of Finance Olson affirmed it is not in the budget but added she will consult with Engineering to discuss existing projects and what should be carried forward. That will occur in the first part of July and will be presented to City Council in the fall. City Manager Fialho stated it will be forwarded to Council, separately, once it is finalized. Councilmember Narum commended Director of Finance Olson and her team for the new and much-improved budget format including the definitions and appendices. Councilmember Testa asked about increases in Workers Compensation. Ms. Olson reported in the budget process, staff needed to highlight concerns, but explained the City has an actuary who assesses, every two years, outstanding/existing Workers Compensation cases and places a value on them. The implication is that existing Workers Compensation cases will be more expensive than what has been experienced in the past. The City has put money aside, through year-end surpluses to help cover those expenses. She reminded Council that it approved a new Human Resources Coordinator position, focusing specifically on Workers Compensation cases to keep costs under control. Councilmember Testa wondered if there are safety issues that should be addressed. City Manager Fialho reported the City is self-funded and commented on having a reserve, equal to 70% of known Workers Compensation obligations as driving the expense. Councilmember Testa commented on the increased Pension Liability and noted the City of Pleasanton is doing much more than most cities to address unfunded pension liability, but it is concerning as to what the State may require in the future. Councilmember Testa asked about the next biggest risk in trends, besides unfunded pension liabilities. Director of Finance Olson reported Sales Taxes are a big concern. City Manager Fialho added that Maintenance Deficits are another big concern. Staff builds into the City's operating budget about $10 million for Repair and Replacement and Capital Improvements into expenditure line items for purposes of building the budget. Councilmember Pentin noted the pension tsunami is coming for everyone and noted the need to prepare for it. He addressed sales tax out of origin and felt the City needs to work towards ensuring sales taxes are kept in the City. He commented positively on the report design and commended staff for its work. Assistant City Manager Brian Dolan presented the CIP budget addressing background, key players, an Overview of the Capital Improvement Program, CIP Funded Status, CIP Categories, Capital Improvement Program Process, a Summary of Financial Resources, Comparison of Available IP Financial Resources by Fiscal Year, 4-Year CIP Funding Sources, Comparison of CIP Financial Resources versus Expenditures, CIP Planned Expenditures by Category for All Four Years, State of Good Repair Projects versus New or Enhancement Projects, CIP Expenditures for Two Funded Years, a Review of Individual Projects and Funded City Council Work Plan Projects. Assistant City Manager Dolan presented samples of funded City Council Work Plan Projects and Samples of State of Good Repair Projects and Allocations of $20.2 million General Fund projects in each CIP category. Vice Mayor Brown asked about the Transportation Corridor Parking. Mr. Dolan the decision on that corridor will be presented to Council for consideration at its June 18 meeting. City Council Minutes Page 6 of 7 June 4. 2019