Breakfast Briefing - The Importance of Strategic Treasury for Public Finance

Transcription:

Melissa Lopez Rogers (00:09):

Good Morning. I'm Melissa Lopez, Rogers shareholder at Greenburg Char and Co-chair of the Atlanta and Orlando Public Finance Practices at Greenberg. My co-host, I don't see here this morning, Sean Wardlow from Seabert. We're both grateful and privileged to open the day today with this wonderful breakfast, which was sponsored by Debt Book who will be the first panel speaking with us this morning. And I'm looking forward to what's supposed to be of interactive and really interesting presentation from Debt book. Yesterday we talked about a lot of things, market outlook. We got a wonderful presentation from Chris Spencer. We talked about prepaid energy and the impact of population and business growth in the Southeast. All things that are very relevant and impactful to our daily practices. And today we will be hearing more about the airport industry updates from Washington High Speed Rail and other fantastic topics. So thank you for joining us this morning. We know it's early and I'm going to turn it over to the panel.

Tyler Traudt (01:32):

Amazing. Thank you everybody for facing some adversity this morning and getting up bright and early to come see our panel. I walked in here at about 7 42 and it was me, one of my colleagues and one other person, and so I'm really glad to see absolutely everybody filter in. We're excited to be with you today. My name's Tyler Traudt, I'm a Founder and CEO of DebtBook. We're a technology company based in Charlotte, North Carolina. I'll share a little bit more about our organization, our story, and why we're here, why we're sponsoring these events, what we're trying to accomplish in the municipal marketplace. Before I do, I would love these ladies to introduce themselves and if you could briefly talk about your organization and your role, that would be lovely.

Megan Kilgore (02:11):

Good Morning. My name is Megan Kilgore and I am the City Auditor of Columbus, Ohio. The office of the auditor in Columbus is largely speaking the entire revenue side of the city and also I'll say the functions that keep the lights on. So everything from payroll and accounting and operations to some of the capital side. We do all the debt issuance, which is very important for everyone in this room. And we also handle all of the pay points, the kind of functions that intersect between our residents, our businesses, and back to our city technology systems.

Emily Brock (02:50):

And I'm Emily Brock. I am the Federal Liaison for the Government Finance Officers Association in Washington DC and our organization represents over 24,000 finance officers. We are very proudly going to have host a annual conference with about 7,000 folks present in Orlando in June. I'm just dipping a toe in the proverbial water while I'm here and I'll be back in June. Very excited to be here, but I'd also like to say well most, well, I typically talk with the bond buyer and other members of the media as our quote lobbyist in Washington dc So I do a lot of work with the members of Congress and also with members of the administration. One of my other parts of my job is to be a staff liaison for GFO debt committee, which is a representation of 25 debt issuers across the country, and they're charged with creating our best practices, which are free and completely available to the public. So I'll be referencing several best practices in treasury and debt management as we talk this morning.

Tyler Traudt (04:04):

Amazing. Thank you both. Before we jump into our list of items that we're going to cover here this morning, I want to set up for the audience what we mean by strategic treasury and who we are as an organization and who we're trying to speak to and why it's important. We at de book really quickly sharing. My background started five years ago. I spent 10 years in public finance, investment banking and financial consulting. So I started my career at Citi as an analyst, pretty average to above average analyst, probably my boss would say on a good day. Did that work for 10 years? And as you all know, spent a tremendous amount of my time working with government and nonprofit finance teams, working with their spreadsheets, working with their internal systems that they're using to manage and maintain all of their loan information, all of their continuing disclosure information, whatever system they were using.

(04:55):

And absolutely, more often than not, it's an excel spreadsheet because the excel spreadsheet was the best solution available to them. It was really affordable, basically marginally no additional cost and people were comfortable using that spreadsheet. But I as a financial consultant knew I could deliver so much value to those organizations if I had immediate access to accurate information so I could go and deliver better financial advice. And so I called 'em up and I asked them, what software are you using to manage all this? Can you share access with me? And they're like, I can send you my spreadsheet. That's it. I felt like it was really a matter of when not if somebody would create purpose-built software for these folks. And as we've gone and grown over the last five years, we've really learned that this is a treasury function, debt management, cash management, investment management.

(05:40):

This is a function that's grown significantly in importance, especially post COVID, especially post Silicon Valley Bank. All of a sudden there's a tremendous amount of focus on treasury interest rates are no longer at zero, investing proactively is going to produce a greater return for the organization. And so I think in many finance leaders and CFO's minds, the treasury function across the country, whether you're government, healthcare, higher education, whether you're a corporation, is really being elevated in terms of the strategic importance of the organization. Along the way, our customers asked us to build software for lease accounting and for subscription accounting, a regulatory change that created a bunch of pain for customers. We did that, we helped them. And we've now grown across our three different products to about 2200 customers around the country. We work with some of the largest issuers in the country. We just recently signed the largest county in the country.

(06:34):

We're really excited about the treasury work that we're doing, and we also help a lot of the small and medium sized organizations with some of their compliance needs or if they have a loan portfolio that needs help, we help there too. And we'll talk more about what we're doing in the future, and if you want to find me and get the pitch, I'll give it to you, just come find our booth. But I just want to share a perspective that we have and why we're here. As a lifer in the municipal securities industry, I've always felt that innovation, and we talk a lot about technology companies, there's so many great companies now trying to help these organizations. It's always going to be held back by the progress we see inside the office of the CFO. The information that I was always using to do my job is generated every single day by the government, by the office of the CFO.

(07:20):

It's generated by that hospital organization. And if we have tremendous innovation around the office of the CFO, but not innovation inside of the office of the CFO, I think we as a municipal securities industry are going to be held back. And so we want to build a better municipal marketplace, but our ground up, our foundation is going to be to build a system to help these organizations go and do their jobs better, become more effective and more strategic in their roles. Now I'm told don't get up there and give a deck book sales pitch, but I thought the context was really helpful. And so what I would like to do really briefly here is jump in with our panelists and ask them to explain a little bit more about their functions, their key objectives, which KPIs they're tracking. There's only a handful of CFOs and team members of CFOs in this room.

(08:09):

We totally appreciate that. Our hope is that over time as we show up and you see our name more, we'll have more content for the office of the CFO, more content for treasurers and auditors and their teams. And if you are a lawyer or an investment banker or if you work somewhere else inside the municipal securities industry, my hope is that you'll learn something from these panels. You'll learn more about your customers and you'll use that information to go build better relationships and ultimately deliver more value to them. So with that long overview of our organization, was it good? Did you like it? I thought

Megan Kilgore (08:41):

It was really, really helpful. And if you don't mind, I'd love to kind of chime in a little bit because what really motivated me, I live in Columbus, Ohio of course, and what motivated me to participate this morning is that I love the very focus on trying to lift up or affect change from our local governments. We have a saying in my office, and I'll tell you a little bit about our technological journey, but we have a saying in our office that we're only as fast. We're only as fast as our slowest system. That I think is a super easy metaphor over to the world of public finance in general. And there are some reasons why when we look at technology especially that can serve as a right hand to that CFO and help her make more informed decisions, we are able to lift up the overall better product and underwriters, individuals, bankers in this room.

(09:42):

You can do everything in the entire world to advance your own systems, but we also are trying to find ways to meet you where you are. And I think that is the transformational opportunity that we have before us is to help improve from the ground up our systems of government. And there's really two separate pieces. One, I do think that the innovation in local government and many places is incredible. I'll tell you a little bit about what we are doing. I followed an absolute legend. He had been in office for about 50 years and he was a sea turtle. He'd been around forever, which I loved because he saw everything, but my predecessor did not have a cell phone. And so that meant that when I knew I was coming into office, I was elected. We had a lot of modernization to do. How many of you are familiar? Just raise your hands with cobol few people. Yep. We had three major systems. Now bear in mind the technology, does that have

Emily Brock (10:49):

A black screen with green lettering across it? Is that the way it Works? Yeah

Megan Kilgore (10:53):

Pretty much.

Tyler Traudt (10:53):

 What is this access database nonsense. We don't need this innovation.

Megan Kilgore (10:58):

And this is I want to kind of bring to life because really easy sometimes to say to government, well, why can't you? There's a lot of reasons and we were so bifurcated in terms of the responsibilities where I'm separately elected the mayor separately elected some technology is there, some of it's under my office and it's really monumental to try and affect change. But when I came into office, we had three separate systems that managed globally, the city of Columbus, 14th largest city. And if you compare us to the numbers of transactions, how many hundreds of thousands of transactions that occur every single month we're really a fortune 1000 if those metrics are applied. And so we had to really lift up our expectation and really put on a different lens. So for example, in our revenue system, which collects every single dollar that comes into the city, there were 208 separate applications written in COBOL that every time there was a tax change, there was a new application.

(11:59):

Just imagine archeological layers of the past all working together clinically to perform. And so in order to create and move forward, we had to put on our archeological outfits, try and dated dictionary the past, make sure that we understood where that information was, and very thoughtfully with a really intentional governance committee move forward. I will tell you, I have the scars and I have a lot of experience from things that I now know that I did not know five years ago. That's why I'm so motivated to be able to help, especially that bread and butter. We've had a deep venture of experts back in Columbus. We've got a lot of people who are on my team. We've got a lot of experts. But for the bread and butter 1, 2, 3 person CFO shops around the country, like the folks that obviously Emily knows so well. That's really my motivation. We are only as fast as our slowest system. So anytime we have technology products like DE book is creating that are able to help produce, because I think a huge thing that is often forgotten is some people assume that government has the capacity just to do something and it often does simply not. But there are things that we can do to eliminate the barriers to that, including really thoughtful technology that helps lift up and empower that CFO to make more informed decisions.

Tyler Traudt (13:34):

I don't know about you, Emily. I'd love your feedback on this. Every treasurer's office or finance director that I go visit with, we talk to them. I walk in their office and it's underwater, completely underwater with work to do. I was visiting with a customer yesterday. We brought up AI, we were talking about it and she said, A little scary. And I said, every time I get the AI is scary. I say, go into a governmental finance office and show me a team that has nothing to do that is worried about that. The work is absolutely out of control. A little bit of automation and relief is probably going to be pretty welcome for those folks. Talk a little bit about your experience with government finance officers and some of the challenges they're facing today from your perspective. Yeah.

Emily Brock (14:13):

Well, so I am a baseball fan. Forgive me. I'm a Nets baseball fan and they do their spring training down here in West Palm. Maybe that's why I'm a NAS fan other than being in DC Is

Tyler Traudt (14:25):

That why you joined our panel? Is that why you said yes indeed.

Emily Brock (14:28):

So what I see at the CFO level, and especially if you are, I was talking with someone yesterday from Amherst County, Virginia, and she said, we have one person for each function one. And so when that means there's more functions having to come their way, that means people start to split. And so she's like, I can't necessarily figure out how to sort of field these. And I'm thinking of her sort of as a baseball catcher, right? She's got to have a quick enough eye to know the strikes. She's got to have a quick enough eye to know that when there's a swing, when there's a bunch, she's got to know where to throw the ball. She's got to make sure that she has her eye on everything that's happening on the field. And when I say that, I mean I really want to pick up on a word Megan said is to be very intentional that a finance officer, she's got a budgeting calendar, she's got an auditing calendar, she's got a fiscal year calendar, and oh by the way, there's constant litany of balls being thrown at her face and she's trying to figure out what is it that is the most important.

(15:41):

I'd like to also pile on a couple of other fun things like unfunded mandates that tend to come from inside the beltway or even inside of her own state. Things like FDIC, collateralization rule and things like the money market rule as it's evolving. I mean, she's trying as best as she can to try to figure out what technology, first of all is free. Tyler, you mentioned that it helps her take things off of her plate. Well, certainly not for the implementation period. Totally.

Tyler Traudt (16:15):

Implementation is a huge barrier

Emily Brock (16:16):

That certainly takes her away from the other things that she has to do. And so finance officers see implementation of new technology indeed as a bit of a chore unless it is instantly gratifying unless it shows instant results. And that's really hard because we're also dealing with a litany of unfunded mandates. And so I think it's less of a resistance to new technologies and it's more of a is this juice worth the squeeze? Can I figure out that this is something that's worth investing in for my organization? You have to give grace to the folks who are doing this every day because right now what we tend to hear in the press is that, well, the municipal bond industry is just slow to uptake new technology. I disagree firmly with that.

Tyler Traudt (17:18):

Totally. I love that. It's exactly right. There's a CFO, Mecklenburg County gentleman named David Boyd who's been a good friend and an advocate and a mentor for us during our five years. And he always talks about the fact that if the implementation process is not simple, people aren't going to be able to go and actually capture the value. There's so many organizations that say, look at this automation, but is it actually attainable? Can I go and get that? And at what cost? It's a tremendous, tremendous barrier to progress. I totally agree with that. I'll tell you though why I think that that challenge, not the implementation specific challenge, but more broadly, what kind of value is available and how hard is it to capture? I'll tell you why I think that that's happening. I took my family, I have three little kids to spring break. I'm probably not going to do that for a couple more years until my youngest gets a little bit older.

(18:08):

We are at the pool and there is a gentleman there. We are alone because it's like eight o'clock in the morning and who's at the pool except for the family with three little kids trying to get some relief. And I walk over and I ask him what he does. He tells me he's a venture capitalist. I'm like, huh, I've raised, we've raised 40 plus million dollars from venture capitalists. I know a little bit about that, which firm? He tells me that he founded and I won't name the firm one of the largest venture capital firms in the country, probably world. I expect that's true. And then he says, what do you do? And I tell him exactly what I just told all these fine folks out here. And do you know what he said to me? What do you think he said to me? He said, why do you make software for governments and nonprofits?

(18:46):

He's an active lecturer. He teaches his class on entrepreneurship to not make software for us that it's too challenging and that they should go make software for corporations. So every brilliant mind in that room is like from before they even get started, I shouldn't make software for governments. I shouldn't do it. And what that means is the people allocating resources to companies like ours are actively encouraging entrepreneurs to not. So what does that mean? It means less competition. It means fewer companies, fewer founders, fewer folks coming into this market trying to create these efficiencies. So what does that do to price? What does that do to quality of experience? It comes down, quality of experience comes down, price goes up. And so I totally agree with you is exactly correct. And it's why at debt book, what we're trying to do is we're trying to create an incredible experience. We're trying to make that implementation experience 60 days nice and easy. Give us your information, we'll put it into the application, we'll test it with you. It's why we actively monitor our implementation, customer satisfaction scores, software on average six, seven out of 10 rating. We want to be able to push a little bit higher. And so not to make this about us, but you're exactly correct, that is a big problem. And we need more companies really focused on solving that problem to go and create the value that CFOs can actually capture.

Megan Kilgore (20:03):

I think the ability to augment with talent when we're doing an RFP, when we're looking at a right partner with whom to move forward or advanced new technology, it's so important first and foremost that that vendor have experience with government all too often. And this is I think an appropriate metaphor for anything from like FDTA all the way down to the complexities that are every day being thrown like dodgeball at local governments. The idea of the question, I should say of government capacity is all too often an afterthought. It's all too often just an afterthought. And so when we're looking at implementing, we have an idea, it's really important to work with individuals who not only get it, but are able to help advance us because they're familiar with our typical barriers. And that goes to change management as well. And being able to help people.

(21:11):

If idea of innovation is much more than replacing agent systems, it's creating a culture where innovation is expected to continue to occur. Even in our hiring, for example, and several issuers are here, I'm going to guess 10 years ago in my office. I came into office about six years ago, but when I first came in, we had a lot of specializations in our hiring. If we were to word cloud our HR, it would be a lot of specializations, very specific functions. Today, it's critical thinking, curiosity, flexibility, agility, being able to separate oneself and ask why, how something is happening. Those are the skills that I am far more seeking than hyper specializations. So I think that that metaphor of the complexity and everything that's being thrown at local governments, it's really up to us. And the catcher is a very good example, but that's why I'm really excited about the platforms of technology. When you're able to put in where we are today is light years ahead, but we can work so intelligently and so differently and it's a really, really good position to be in. But from your perspective, Emily, I'm going to guess across the country, just the reconciliation of the new normal is really challenging right now.

Emily Brock (22:39):

Oh, for sure. And I think that what's the reality of our market is that there are wonderful complexities that allow for technologies to spread in sectors. So in higher ed for example, there's a lot of technologies tracking value to tuition in airports, there's a lot of technology tracking private activity and of course ridership and all of the other pressures of FAA on airports in cities and counties and states. There's varieties that make them great, but also technologies that accommodate their tiny space of our tiny market. Now it's funny when you think about sort of corporations and their adoption of technologies in their space, I mean public corporations, anybody want to guess how many public corporations there are?

(23:38):

That list on the stock exchange? 4,000. Anybody know how many public issuers there are? Fourty thousand, right? So tenfold the amount of issuers trying to figure out how they can be transparent, how they can communicate their decisions, how to use data and decision making. GFOA is working on a project right now where we've come to realize that 80% of strategic decisions are being made on 20% of the information that's being produced by the finance office. So a fraction of the runaround that we're trying to do to be transparent is only being digested about 20% or a fifth of the information that we're putting together. And so it's important to identify what that is. And I know you investors in the room will say, don't give us less information. No, don't you dare give us less information. So I certainly think that there is a space in the world for that. Of course, GFA would advocate that we got to use what we have. There is AI that's free. There is different technologies that are cropping up that are readily available and open source. And so we're certainly at GFOA looking for opportunities for issuers to be able to utilize technology effortlessly.

Tyler Traudt (25:06):

I love it. I think it's a really great point. I want to, I say double click all the time and I'm constantly told to stop saying double click. I'd love to double click on that really quickly.

Emily Brock (25:16):

What does that mean? Did I just open up another browser?

Tyler Traudt (25:18):

You're going deep on it.

Emily Brock (25:19):

I'm going, I'm going deep.

Tyler Traudt (25:20):

Double click that link looks great. I'm going to double click that. So 20% of the data being used. And then my next question would be what percentage of those conversations where the finance department is producing financial information, is the finance leader a strategic leader in the room with leadership helping to make those decisions? I was on the phone with one of our CFOs last week. We were talking about exactly this strategic versus operational. His point was, wherever I go, I want the team to understand that yes, we need to produce all the financial information. We need to go and do it. That's our job. That should be boring. We should do it all the time, every single day. It should run like clockwork, but we need to be in the strategic conversations with the city manager. If there's an elected official in the room, we need to be in there with them, a partner to the organization.

(26:09):

And you see that across all different industries. You can read about it. There's a shift from finance being viewed as a operational function into a strategic function, which makes perfect sense for all of us in this room. That would make sense to you. These are the folks that are excellent with the financial statements. These are the folks that are excellent running building models and doing forecasts. They should be involved. I would just wonder is there, and I believe there is a challenge with the way maybe city managers, county managers, administrators, CEOs of hospitals view that CFO or if it's just a finance director or if it's down even further and can we pull them to become more strategic, which would enable better financial outcomes? So just talk a little bit your perspective about that and how that's shifting over time. Just curious.

Emily Brock (26:58):

I Might also add another level layer that adds to the complexity I think of public organizations is your elected officials are probably at the top of that, right? So your elected officials, I'm sitting next to one, so they're great, they're great, they're terrific, but they are sometimes finding new fun, I don't know, federal money to pursue or new fund initiatives to do, or even at the local level they're talking with constituencies and sort of trying to figure out what the investment should be made in that organization for the betterment of their fiduciary, but at the same time, there you go. You got that level where the finance officer is sort of the technocrat in the room as opposed to the strategic thinker. Oh, well the finance officer can figure this out. What I think has been really interesting is in the evolution, in the evolution of the finance office is the finance officer is starting to learn a lot more about those externalities, those external pressures they're becoming in the advent of just getting news all the time and certainly being a member of GFOA or getting information about what's happening in DC and what's happening in all of these places so that you can come to the conversation manned with information that allows for more strategic thinking to happen.

(28:24):

An example of this is climate, certainly interest and interest and appreciation of data that acknowledges climate risks with a nexus to credit is certainly something that the Bond Buyer organization really does a great job of talking about and provoking thought in. Well so too is the finance officer. The finance officer, starting to think of how climate sits with a nexus to credit climate also plays a role in procurement. Climate also plays a role in how you might want to approach the market. So do you want to label your bonds to sell them as green or renewable or sustainable bonds? And so the evolution of our space and the products that exist in our space like bonds, like green and renewable energy bonds and the inflation reduction act and all of those things that are on our doorstep allow for the finance officer to take part more actively in that strategic thinking.

Tyler Traudt (29:32):

Megan, will you talk for a second? Let's continue the conversation here. Emily brought up credit impacts some of the decisions are being made, some of the challenges that are being faced by these organizations and how it impacts these folks here in the room. Talk broadly a finance function, strategic finance function, trying to eliminate a lot of these operational inefficiencies. What do you do with the time? Just tell me how the organization improves and tell some of these folks how maybe their job becomes easier or you can better engage with the municipal marketplace if you have innovated appropriately, if you've invested to eliminate some of these operational challenges to become more strategic, what's the benefit?

Megan Kilgore (30:12):

I am going to make this a weird sentence. I'm going to make a weird statement here. But I think what separates good from great governments in this country, emotional intelligence and the ability to proactively and thoughtfully plan for the future. We are every single day faced with decisions that will either in a few years time come back to affect us negatively or to put us in a position of success. And it's not just carrying out, I love the word technocratic because if we focus exclusively on just what the data might suggest, if we look at just technocratically, this is what we should do. We're possibly missing out on how to create the city or the county or the school district that we could be. And this is really, I want to maybe transition this question and answer it in a way that is relevant to underwriters, to bankers, to the credit side in this room.

(31:11):

Local governments right now are ramped up with opportunity and if you are able, as you're making presentations and you're looking at your local governments and it's beyond coverage, it's like just beyond basic coverage, but helping to connect the dots to help them plan proactively. I'll give you a very simple example and look at tax bases across the country. We're an income tax driven state in Ohio. And so in Columbus, this is because of our ability. We implemented a revenue system that is pretty much in real time. Every single, just think about it, income tax is paid out of individuals, wages we know about every two weeks when you get your paychecks back in Columbus, how our local economy is doing, it's a weirdly kind of omniscient kind of role to look at, but you see the kind of undulations of the economy and we saw wage inflation.

(32:09):

We would never have seen this in near real time, but for the technology that we were fortunate to put into place. But just consider if we look at every single industry, we know who is working to their full capability, we also know our pockets of our demographics who are simply not able to either gain gainful employment or regain and if we make intentional policy decisions. And this is back to the role the CFO in my capacity 25 years ago we weren't, I would say on the strategy side, now we're kind of in the driver's seat, but this is such a powerful opportunity for those of you on the private side to look at this too. But we're able to make recommendations that actually create a strong outcome in our tax base. And I'll give you a very basic example. Education, childcare. We do little micro programs and we're able to very quickly ascertain what has ROI and what does not.

(33:12):

That is all a hundred percent because of our position and technology. That type of climate is a hundred percent. Also, as you help your local governments see what the kind of future can look like, do just be mindful that helping them connect the dots because of the lack of capacity, helping them see that it very well could simply be just a capacity function of why they're not doing it. But planning and that emotional intelligence, it sounds a little cheesy, but I really do believe above all else, if I'm picking my leaders, someone who has the ability to be very, very thoughtful and plan adequately.

Tyler Traudt (33:53):

Let's keep going here. Let's talk a little bit about the tangible impact. An investment banker, a ratings analyst, an investor might see if they're working with an organization that is being strategic and thoughtful in the finance function, leadership believes in the finance function and its strategic importance. They've invested in systems, they have immediate access to information to go make better choices. If you had more time freed up, if you had more data, more visibility in those things, which totally right, big challenge to get to, that's a big project. But if we did, if we get to that outcome, how do folks in this room, how do they experience that? What does that feel like? What tangible benefits would be received by the municipal market participants if you had an organization like that? Just curious if we can brainstorm on that.

Emily Brock (34:44):

Well,

Tyler Traudt (34:45):

Big question.

Emily Brock (34:46):

I know. Well, I'm sitting next to one who does a city that does and sort of the pinnacle of the brand of Columbus is that there's a very active finance conversation and strategic conversation happening throughout the organization. I think for folks that they work with, I think it's very clear, abundantly clear that the finance officer is involved in decisions that can sort of progress the organization without question. And again, like organizations like that tend to be invited to testify before Congress and things like that. However, I would say be careful because not everybody's a Megan Kilgore. We aspire to be, we try to be, but there are organizations and certainly public issuers where they don't benefit from that just yet. And there are organizations that

Tyler Traudt (35:47):

The same degree. Yeah, exactly,

Emily Brock (35:49):

Exactly. The organizations such as that I represent GFOA. I mean what we try to do is create this suite of 188 best practices which allow for the finance officer to come armed with data and information and best and learning practices that exist among 24,000 members that help to write them.

Tyler Traudt (36:10):

I want you to respond to this too. I'll just share in our company's experience. So we're 150, 160 person organization. We have four finance team members. We have an accounting team and we have one finance financial planning and analysis, strategic finance professional. That finance professional is in every single leadership meeting is the person he's in every single board meeting. He's working with us all day long, bringing insights so that we can improve ultimately financial performance. Our board, our investors, they really want financial performance. That's what they're looking for in an organization like ours. Ultimately, if we are bringing better information, more readily available, if the finance function is a strategic asset being utilized by executive leadership inside the organization, you should get better choices. We should get better decisions. And that should mean either better financial performance, which local governments number one is not financial performance, not make as much money as possible, but stronger organization, stronger financial performance for sure, more projects more likely to help achieve its mission that it's being set out to go and achieve. And so what we should ultimately see, and it'll be hard for us to say, look, there it is there. You should be in a better position to witness governments and nonprofits performing better because they're making better, more informed choices.

Megan Kilgore (37:37):

I love that. This is super fun. When I just wrote down a note, there are two questions. We have the stuff that we can control and then this is in this very small bucket. I'm looking at my new friend from Rock Hill, but our bucket of stuff we can control is this big. The stuff that we can't control is the size of this room. And that's what I wanted really to use. Paraphrase Tyler, double click on the idea of the emotional intelligence because, and I look at technology in just what we can control in our day. We cannot control the fact as CFOs in this country that we have some of the most complex times, even things like the inflation reduction act. This in gargantuan nebulous bill, so complicated that even a AAA city like Columbus has really struggled to make sense and make full use of it.

(38:33):

But what great opportunity and for example, and this is in Ohio as many states around this country, I never thought, and I started in this business about 20 years ago, first as a debt issuer, then as an advisor. I never thought for example that in my role as the CFO of the city that I would have to be contending daily with what is legislatively happening in the state of Ohio. I thought home rule was a pretty good thing. And for example, in Ohio, this is a true story. About a year and a half ago I found myself testifying in the Ohio State legislature against one of the many, many bands that had been proposed. This one was about firearms. And I was telling, I sat next to Caitlin last night, we were chatting about just like the complexity, but you can never be the smartest in the room, but we can be the most prepared. And so I worked my absolute butt off trying to overly prepare for any question that could have possibly been asked by the good people of the state legislature and who my opposing testimony was was a fellow who owned a sket shooting place. And I thought in this moment, well first of all I thought I got to go back to the private sector. But the second thing I thought was

Tyler Traudt (39:52):

Don't offend them.

Megan Kilgore (39:55):

We just have to move forward. This is a complexity, it's a barrier. It's no different than just seeing it. This is physics. This is a potential barrier. So back to that emotional intelligence, how do we work around it to still get the best outcome for our local governments? And when we have all of this additive stuff, both good and bad, the only thing that I think can make the most sense for ease and remedying our very, very busy days is having technology. Two things for us instead of having four separate calendars reminding us of when debt service payment dates are one's written, the other three are on Outlook and one's in Excel, how do we have integrated systems that can alleviate some of those hindrances to allow frankly our brains to be put to the either forced stuff that we have to deal with or the good stuff about planning for our future.

Tyler Traudt (40:52):

Well, we've got through number one of my 10 things that I wanted to talk through here. So if we could just have four more hours, folks in the back, that'd be really great. Thank you. So we've got five minutes left here and I want to reserve just one or two minutes if I can talk about why I think the work that both of you are doing is incredibly important. And I'll wrap with that. Maybe we can talk really quickly as we go forward here. We know we've got hiring challenges everywhere, wherever you are, if you're an accountant, if you're a finance function, you struggle to hire talent, retain talent, promote talent, those kinds of things. Let's just talk a little bit really quickly and about how maybe your organization at Columbus, Columbus or more broadly governments are trying to address the talent shortfall because that directly impacts our capacity to do all these things and get to a point of being strategic. Strategic sometimes can be viewed as a luxury. We've got to do the work that's right in front of us all day long, get the audit done, do our work. So talk a little bit about how maybe organizations are addressing some of those challenges and how they're affecting them.

Megan Kilgore (41:52):

I'll speak on, I'm a very micro, but we

Tyler Traudt (41:55):

90 seconds,

Megan Kilgore (41:56):

We are super able to attract talent because it's reminding folks that we operate like a Fortune 1000. We have badass amounts of data and incredible amounts of technology. We're doing stuff with generative and narrow AI, but we're a rarity. We're able to still attract because of that. And we just find that person who has a heart for public service.

Emily Brock (42:17):

I think that really that heart for public service is something that our board, I know I've got a past president here and certainly a current executive board member. It is part of our strategic plan to actually help with hiring in the public workforce. But there are two things that we've concentrated on. Number one, trying to find them when they're young and it's really hard to tell somebody at Florida State that they need to come work for a local government when they're out. I mean, let's just face the reality of it. And so what you have to do, and Megan said it's the heart of it and it goes back to what you said about even emotional intelligence. Why is a person being a public servant, why does a person choose to pursue a career at their local government? It is because they choose to serve. And so finding those folks is actually getting a little bit easier, believe it or not because I think that purpose in serving has started to become a central nexus for those folks matriculating through the universities right now.

Tyler Traudt (43:25):

You would hope that we can continue that trend. That makes perfect sense. A lot of folks that we interview coming in are looking for real purpose. When we do employee engagement surveys, we hear that back. How satisfied are you with the work you're doing every single day and the impact that you're making. There should be no better place for those folks to go and apply themselves and these organizations so we can continue to pick that lock. We should be able to get that door open pretty confident. We've got two minutes left. This has been a ton of fun and I appreciate both of you so much for spending some time up here with me. I'd like to just really quickly jump up on my soapbox for one minute and talk about why I think it's really important. And if you want to roll your eyes or leave the room right now, and maybe now's the time, these folks up here, folks in the room.

(44:06):

When you are working inside of a government or a nonprofit, specifically inside the office of the CFO, you are the leader. These are the teams that are driving financial performance. They're helping leaders and themselves make better choices. Better choices ultimately are going to result in either better financial performance, likely or more of the organization's mission being accomplished. I mean, if your mission as a healthcare organization is deliver care, you need to build a long-term sustainable organization and you need to deliver as much of that care as you possibly can, the best quality care that you possibly can. And if you have a strategic finance function who is spending more of their time with this information, trying to further enable the organization's mission, you're going to do more of it very simply. It's not the difference between we have a hospital or not, but it might be the difference between somebody's experience somewhere.

(44:55):

And so I get really excited to speak to ladies like you up here that are helping these organizations deliver ultimately the most critical services that we all need. Everybody here uses these services every single day. It's not the stuff that you want to do that governments and nonprofits deliver. It's the things that you need to have. It's affordable housing, it's safety, it's things like clean water. It's care for yourself, for your parents at some point. And so I just want to say thank you to both of you for being here. I think it's really, really important work and we're excited to hopefully be a really small part of progress. So thank you very much. Thank you. Thank you all.