HomeMy WebLinkAbout2006-08-24 (Special Called Mtg) MINUTES OF A SPECIAL CALLED MEETING
�•. OF THE
EULESS CITY COUNCIL
AUGUST 24, 2006
ITEM NO. 1 CALL TO ORDER
A special called meeting of the Euless City Council was called to order by Mayor Mary Lib
Saleh at 7:00 p.m. on Thursday, August 24, 2006, in the Council Chambers. Those
present included: Mayor Mary Lib Saleh, Mayor Pro Tern Linda Martin and Council
Members Carl Tyson, Leon Hogg, Charlie Miller, Glenn Porterfield and Michael Brown.
STAFF MEMBERS PRESENT
City Manager Joe Hennig, Deputy City Manager Gary McKamie, Assistant City Manager
Loretta Getchell, City Attorney Paul Wieneskie, City Secretary Susan Crim, Deputy City
Secretary Becky Null, Director of Economic Development Bill Ridgway, Director of
Planning and Development Mike Collins, Director of Parks and Community Services Ray
McDonald, Director of Public Works Ron Young, Fire Chief Lee Koontz, Assistant Police
Chief Bob Freeman, Finance Administrator Vicki Rodriquez, Finance Controller Gary
Yakesch, City Engineer Robert Barker, Texas Star General Manager Glenda Hartsell-
Shelton, Library Administrator Kate Lyon, Information Services Administrator Dan McLain,
and Communications/Marketing Manager Betsy Boyett.
VISITORS
Harold Briggs, Charles Cinquemani, Bobby Baker, Greg Black, Andy Chesney, Mike
Utzman, Kathy Haecker, Terry Lee Goodrich, Faye & Tim Stinneford, Sonia & Robert
McMillon, Bill Brown, George Moore, Carroll Scott, Helen Voss, Boyce Byers, Keith
Eggers, Alex Horton, Jack Hill, Katie & Bobby Edwards, Gaynel Tyson, Lindy & Pauline
Harris, Veva Lou and David Massey, Barney Snitz, Don Martin, Foster McMillan, Ray
Kunze, John & Carmen Deithloff, and Nadine Barnes, and others as noted in the visitors'
register.
Prior to opening the public hearing, Mayor Saleh read the following statement:
"Before we begin our public hearing tonight regarding the tax rate, I would like to respond
to the community regarding a rumor concerning Councilperson Mike Brown. Mr. Brown
was duly installed as a city councilperson in May and took the oath of office to uphold the
laws of the United States, the State of Texas, and the City of Euless. He has every right
and duty of a city councilperson, including the right to vote for the City of Euless budget
and tax rate. When we became aware of the rumor floating around that Mr. Brown should
not have the right to vote on the budget and tax rate because of his interest in applying for
the city police chief upon retirement of the present chief, we called our city attorney and
requested an opinion from the Attorney General of the State of Texas. The Attorney
General has opined that Councilperson Brown has every right to vote on the City of Euless
budget and tax rate. Surely that should end the rumors and we can get on with the
business of the city."
Special Called City Council Minutes Page 2 of 7 August 24,2006
... ITEM NO. 2 PUBLIC HEARING ON PROPOSED TAX RATE
Mayor Saleh opened the public hearing at 7:05 p.m. regarding the proposed ad valorem
tax rate of$0.489500 per$100 valuation for tax year 2006.
Assistant City Manager Loretta Getchell stated that although the public hearing is for
consideration of the proposed tax rate, she wanted to give the citizens an overview of
the proposed FY 2007 budget. She stated the General Fund is the city's largest fund
and supports the primary governmental functions such as public safety, street
maintenance, code enforcement, etc. The FY 2007 budget includes resources of
$28.6M, of which $26.5M is expected from current revenues and $2.1M represents a
planned draw-down of fund balance for capital and one-time expenditures.
Property tax represents the city's largest revenue source at 28% of total revenues. The
remainder of the funding for this budget is derived from sales tax, franchise fees, fines,
and other miscellaneous sources. Projected property tax revenue is based on a tax rate
of 48.950 per$100 of assessed value.
Proposed General Fund expenditures total $28.6M, which includes capital and one-time
expenditures of $2.1 M and departmental expenditures totaling $26.5M, of which 46% is
dedicated to public safety.
Increases in the current year budget are attributed to a 4% salary package for
employees, increased funding for the city's health insurance plan, increased utility
costs, and additions to personnel including three firefighter/paramedics, three
dispatchers, a juvenile case manager, a court clerk and the upgrade of a part-time
accountant. The additional three firefighters/paramedics will allow the third ambulance
to become fully staffed and the addition of the three police & fire dispatchers will allow
for the enhancement of the Emergency Medical Dispatch program.
Proposed capital expenditures include funding to continue the street overlay program,
the sidewalk program, provide for needed public safety equipment, computer hardware
and software, facility improvements, and a dog park that has been a top request of
many of our citizens.
The second largest operating fund is the Water & Sewer Fund with proposed resources
totaling $16.3M of which $15.3M is expected from current revenues, primarily water &
sewer user charges and $993,000 is a planned draw-down of fund balance for capital
and one-time expenditures.
Proposed expenditures of the water & sewer fund total $16.3M. This budget covers the
cost of purchasing water from Trinity River Authority, the cost of sewer treatment by
Trinity River Authority, all expenses associated with water production and distribution,
meter reading & billing, debt payments, overhead expense and infrastructure
replacement.
Special Called City Council Minutes Page 3 of 7 August 24,2006
�.. Increases in this budget are attributed to utility costs, fuel costs, a 4% salary package
for the water & sewer personnel, increased funding for the city's health insurance plan,
and capital expenditures including computer equipment, water meter & transponder
replacements, water well equipment, and replacement of several water & sewer lines
that have aged and deteriorated.
Projected water revenue is based on a proposed increase of 13¢, which will bring the
cost per 1,000 gallons to $2.93. Projected sewer revenue is based on a proposed
increased of 15¢, which will bring the cost per 1,000 gallons to $2.15. The city
purchases much of its water from Trinity River Authority and has all sewage treated by
Trinity River Authority. These projected increases are based on information from Trinity
River Authority indicating that the city's cost will be increasing by an equivalent amount
due to significant increases in their utility costs. It is important to note that any rate
changes would not occur until December and would not be effective without additional
action by the city council. The cost of water and sewer in the City of Euless remains
competitive with neighboring cities.
Another fund that is important to discuss is the Car Rental Fund. This fund is fully
supported by a 5% tax that was authorized by the citizens of Euless in 1999 to be
imposed on the short —term rental of motor vehicles. Per an agreement that resulted in
the car rental facility at DFW Airport being located within the boundaries of the City of
Euless, two-thirds of this revenue is rebated to the owner cities of DFW Airport. The
remaining one-third of these funds has been of enormous benefit to the City of Euless.
To date, approximately $17M of equipment, infrastructure and facility improvements
have been accomplished without the issuance of debt and without additional property
taxation to our citizen.
For FY 2007, the proposed budget includes estimated total revenues of approximately
$11.3M with a net of $3.9M after rebate. Based on council direction, approximately
one-third of these funds are used to pay a portion of the general government operations
and general obligation debt service, which has a direct reduction on the property tax
burden. Additionally, a portion of these funds will be allocated for a new fire truck, the
pubic works facility site, and additional monument signs. Other projects of note include
$408,000 of street improvements, $320,000 of drainage improvements and $435,000 of
park improvements, which will be funded by the Euless Development Corporation.
The city has several other special revenue funds, debt service funds, internal service
funds, and enterprise funds that are included in the city's total budget. Details of these
funds can be found in the Preliminary budget that is on file in the Library or the City
Secretary's Office.
In summary, the city's total resources are projected at $83.7M, which includes
approximately $6.6M of planned draw-down of fund balance and $77.1 M of current
revenues. Proposed operating expenditures total $80.1M and include $73.5M of
operating costs and $6.6M of capital and one-time expenditures.
Special Called City Council Minutes Page 4 of 7 August 24,2006
The overall budget consists of many decisions including the property tax rate. However,
�• this hearing is primarily for the purpose of hearing citizen input on the tax rate that is
proposed. In addition, she stated the city has been fortunate to see its tax base expand
from just over $1 billion in FY 1996 to 2.4 billion for FY 2007. The tax base is comprised
of approximately 44% residential, 25% multi-family, 17% personal property and 14%
commercial/industrial.
The proposed tax rate for all entities for FY 2007 is $2.7337 per $100 assessed value
for those in the Hurst-Euless-Bedford Independent School District and $2.7067 for those
in the Grapevine-Colleyville Independent School District. The school district represents
about 58% of the total tax bill, the city 18%, the county 10%, the hospital 9%, and the
community college 5%.
The Euless tax rate has declined steadily from 60.6¢ in 1996 to a proposed rate of
48.95¢ for FY 2007. The significant reduction in 1997 was due to the 3/4¢ sales tax
passed by citizens in 1996 for the purpose of reducing their property tax liability.
There are two components to the tax rate; a debt component and an operations
component. The debt component has reduced from a high of 19.8¢ in 2003 to 14.63¢ in
2006. State law requires that we levy a tax rate sufficient to pay the required debt
payments on outstanding bonds. The remainder of the tax rate can be used to fund the
city's general government operations. The operations component has reduced from a
high of 45.62¢ in 1996 to 34.32¢ for FY 2007. As of FY 2007, the City has total tax
supported debt outstanding of$35,995,000. The required debt payment and associated
fees for the upcoming year is $3.7M, of which the car rental fund pays $195,237 and
$100,000 is paid from fund balance. The remaining $3.4M requires a tax levy of
$14.6273¢.
The operations portion of the tax rate is determined by considering all other current
revenue sources that are available to pay projected expenditures and calculating
revenue needed from property taxes. Based on current projections, an operations rate
of 34.3227¢ is needed to generate sufficient revenues to balance the budget per the
current council adopted fiscal policies, which require that we submit a balanced budget
using current revenues to fund current expenditures.
The proposed rate is a reduction of .2277¢ from the current rate of 49.1777¢. However,
individual taxes may vary based on changes in the assessed value of each property.
The average home value in the City of Euless for FY 2007 is $132,567. After applying
the 20% homestead exemption given by the City of Euless, a taxpayer of an average
home would pay $519.13 annually or $43.26 per month.
The average home value for a senior citizen in the City of Euless is $118,672. After
applying the 20% homestead exemption and the $35,000 senior citizen exemption, a
senior citizen with an average home value would pay $293.39 annually or $24.45 per
month. This amount may be further reduced due to the fact that Euless has passed a
freeze on senior citizen taxes. This means that when an individual reaches age 65,
y`" taxes will be frozen and the citizen will never pay more than the frozen amount.
Special Called City Council Minutes Page 5 of 7 August 24,2006
In closing, she stated that for $43.26 per month, citizens receive 24-hour police and fire
N.y protection, city infrastructure including streets, traffic lighting, etc., library services, park
amenities, animal control services, health inspection & code services.
The following people spoke in opposition to the proposed tax rate of $0.489500, which
would be a reduction from the current tax rate of $0.491777 and instead wanted the
effective tax rate of $0.472131: Jake Thomasson, 1816 Tyler Avenue; Harold Briggs,
211 Shelmar Drive; Bob Edwards, 603 Ascot Drive; Greg Black, 405 Cherry Ann Drive;
Ray Kunze, 2017 Fountainview Drive; Curtis Bjornlie, 1405 El Camino Real #109; Jack
Hill, 616 Bent Tree Drive; Mike Utzman, 316 Calvary; Alex Horton, 1909 Fountain
Meadow Drive; and Carroll Scott, 201 Fountainview Drive.
Mayor Saleh read the following names of those who registered against the proposed tax
rate, but did not want to speak: Nick Payblas, 1311 Tanglewood Trail; Gaynel Tyson,
1816 Shenandoah Drive; Scott Makar, 700 Creekside Drive, and Veva Lou and David
Massey, 613 Bent Tree Drive.
The following people spoke in favor of the proposed tax rate of $0.489500: George
Moore, 1104 Aransas; Bill Brown, 900 Royce Drive; Tim & Faye Stinneford, 2408
Bayberry Lane; and Bobby Baker, 405 Cullum Drive.
Mayor Saleh read the following names of those who registered in favor of the proposed
tax rate, but did not want to speak: Don Martin, 305 Lark Lane; Richard Barker, 1800
Fuller-Wiser Road #606; Kerri and Treavor Mellott, 209 Cliffdale Drive; Nadine Barnes,
412 Nimes Drive; and Erelene Hill, 462 Arbor Club Lane.
There being no additional proponents or opponents, Mayor Saleh closed the public
hearing at 8:12 p.m.
Mayor Saleh asked for comments from each council member.
Council Member Porterfield stated the tax rate is an integral part of the operation of the
city and can be misunderstood. Even though the tax rate has gone down, taxes have
gone up every year due to evaluations. He stated the city is providing every service that
they believe is needed and have done so many things to improve the infrastructure,
streets, utilities, parks, and we have the best library anywhere. He stated some of the
council feel that the approximately $400,000 difference between the proposed tax rate
and the effective tax rate is not a big deal. He stated they will live with whatever the
council decides upon; however, it is not the $400,000 itself, but the thinking behind it.
He stated he did not want to lose any friends over this, but does prefer the effective tax
rate.
Council Member Miller thanked everyone for coming to the council meeting. He stated
the council is here to provide services to the citizens at the lowest possible cost. He
stated the difference of opinion is how the revenues are shown or projected. He likened
the citizens to stockholders who should be given the lowest possible rate. He stated
there are $14-15 million in reserves and sees nothing wrong with returning the money,
even if it is only $10 back to the people, since the money recycles back into the
community. He stated he is comfortable with the $0.47 tax rate.
Special Called City Council Minutes Page 6 of 7 August 24,2006
Council Member Tyson stated the council is elected by the people to provide the
needed services; i.e., police, fire, public works, parks, and emergency funds, etc. He
stated the July financial numbers can pick up $406,000 of what would be lost with the
effective tax rate. The council worked off figures provided in May when they reviewed
the proposed budget. The property tax can go to the effective rate of $0.472131, and
we will still have all of the extra reserves that we need.
Council Member Brown thanked the citizens for attending the meeting. He stated it is a
great problem to have; deciding how much we are going to cut the tax rate. He thanked
City Manager Joe Hennig, Deputy City Manager Gary McKamie, Assistant City Manager
Loretta Getchell, and staff for putting the city in the good financial condition it is currently
in. He stated that the employees have got to be protected and urged the council to vote
to take care of them, as well as the safety and welfare of the citizens. He stated that a
60-day reserve may not be enough in the future, and that he is for the proposed
$0.4895 tax rate.
Mayor Pro Tem Martin thanked everyone for attending the meeting. She stated that all
revenue sources are volatile. She questioned whether a business owner who made a
profit last year would decide to lower the cost of his goods or services the next year, or
would he reinvest the capital into his business to make a financially stronger business.
She stated she was for the proposed $0.4895 tax rate.
Council Member Hogg thanked everyone for coming and staying through the public
hearing, and stated he is comfortable with the proposed $0.4895 tax rate. He stated It
is his duty to not only look out for today, but for tomorrow also.
Mayor Saleh wished City Manager Joe Hennig a Happy Birthday. Mayor Saleh read the
following statement:
"Let me begin with saying the City of Euless is in the best financial position we have
been in since 1993. And our citizens have made that possible with the passing of the 4-
B sales tax and the citizens crime prevention tax along with a quarter-cent tax reduction
for you. Before the passage of those taxes we struggled to do the things our citizens
need. Each year the administrative staff begins their budget process in the late spring
and works with all departments to review the present budget and then listen to the
future needs of the departments all in an effort to serve our citizens better. After months
of preparation, the budget is finally presented to the city council. We have professional
staff that has spent a great deal of time and overtime to finalize a budget that can be
accomplished while protecting the city against any unfortunate circumstances. The city
council has not raised the tax rate since 1993, but we have increased the homestead
exemptions for all homeowners, increased senior citizen and disability homestead
exemptions and voted in a senior tax freeze. We have one of the lowest tax rates in
Northeast Tarrant County. In fact, we are the only city lowering the tax rate this year.
All other Northeast Tarrant cities are remaining the same in their tax rate or raising their
rates. At a very recent meeting with other mayors, the consensus is that they are
putting away for a rainy day. Economists throughout the nation are advising a slow
down in the economy. We simply cannot rely on sales tax to balance our budget. Yes,
we could go lower on the tax rate but we could end up like our sister city that had to
Special Called City Council Minutes Page 7 of 7 August 24,2006
close many of their citizens' services because there was not enough money to operate
*ay the city, all because the elected city council could not work together for their citizens.
We are the fourth largest city in Tarrant County and we also sit right next to one of the
largest international airports in the world with major highways and located between two
large cities. If, and I say if again, we suffered a terrible calamity, the 60-day reserve
would be inadequate and where would you and I be? It is good to have a council that
does not agree with each other on every note. The purpose of a budget worksession is
to evaluate the budget that is presented and decide what we all can support together.
In the past years when there has been a divided council opinion on the tax rate, there
has always been a concession on the final vote that we will go forward as a unified
council and work together for the benefit of all our citizens. As you can see tonight,
there is a difference of opinion with the council members on the tax rate. We all have a
right to our opinion, but in the final analysis the majority vote is what counts. I trust our
city administration and the budget they have presented. And I sincerely hope we can
work together as a unified council for the benefit of our citizens. Thank you for your
turnout tonight and showing you care about our city!"
ITEM NO. 3 ADJOURN
The meeting was adjourned at 8:45 p.m.
Immediately after the meeting was adjourned, Mayor Saleh realized she had not
announced the vote on the tax rate. She turned the microphone back on and called for
everyone's attention while they were still in the room and made the announcement that
the vote on the tax rate would take place on Tuesday, September 12, 2006, at 7:00 p.m.
in the City Council Chambers, 201 N. Ector Drive, Euless, Texas.
APPROVED:
Mary Lib S.'-h
Mayor
ATTEST:
u an Cri ', 'MC
City Secret.ry