Loading...
HomeMy WebLinkAbout11/25/1986 City Council MINUTES OF THE CITY COUNCIL MEETING HELD ON NOVEMBER 25, 1986 The SPECIAL SESSION of the City Council of the City of The Colony, Texas was called to order at 7:00 p.m. on the 25th day of November, 1986 in the offices of the City Water department, with the following Council Roll Call! Don Amick Mayor, Present Rick Harris Mayor Pro-tem, Present Tom Arrambide Councilman, Present David W. Dye, III Councilman, Present Steve Glazener Councilman, Present Harvey Bradley Councilman, Present Marlene Poole Councilman, Present and with seven members a quorum was established and the following items were addressed: 1. COUNCIL WORK SESSION REGARDING THE 1986/87 BUDGET Mayor Amick stated that there are two (2) items currently facing the City that may or may not impact the budget for this fiscal year; 1) Single Family Residence Licensing. The Mayor said that when this ordinance was initiated additional staff was required and if this Ordinance is repealed, then what would happen to that person. Mayor Amick went on to say that the Council and staff needs to take what the landlords stated in the Citizens Input portion of the last Council meeting objectively and then make a sound decision. Mayor Amick said that he had asked former Mayor Larry sample to be at this meeting and speak regarding the SFR Ordinance because he (Sample) was Mayor at the time and fully understands the reasoning behind the ordinance, stating again that the Council needs to remember that this could impact the ~1986/87 budget. 2) I.B.M. taxes on their property within The Colony may not be as much as estimated during the budgeting process. Mayor Amick introduced Larry Sample who spoke as a landlord who is in favor of the SFR Ordinance. Mr. Sample gave a copy of a letter he had written sometime ago to I.B.M. to the Council stating that this letter might be useful or interesting when discussing the second item Mayor Amick had mentioned earlier. Mr. Sample then went on to hand out some information he had gathered regarding the SFR Ordinance, stating that being a landlord is a good tax write off for someone who's yearly salary is from $50,000 to $100,000, going on to give reasons why that is so. Sample noted deductions,including the licensing fee of $35.00 and said that if there is a management fee, that fee is also deductible. Mr. Sample noted that total deductions on the particular property he was using as an example were $8560.00, stating that $4500.00 depreciation can also be deducted. Mr. Sample then went over a cash flow chart of expenses and revenues and also covered the original landlord ordinance propsed in 1982, which he said was taken from Addison noting that it ~ had been in effect since 1979, and mentioned that this ordinance has some protection for tenants that the current ordinance The Colony uses does not. Mr. Sample said the reason the City addressed this ordi- nance to start with was because approximatley one fourth of the City was rental property and the Council felt there needed to be some control and to be able to identify property owners in the City, going on to say that it is very difficult to identify the owners without this ordinance because the tax records aren't always transferred. Mr. Sample said C.O.G. showed 28.02%rental property in The Colony, which was over the average, i.e.; 11.4%, Denton County and 8.2% Dallas County, 1982 figures. Mr. Sample said the Certificate of Occupancy allows inspection only when there is a change in occupancy whereas the SFR Ordinance dis-allows more than one family living in a single family residence, allows inspection of a home once a year (after notification to the landlord), and also allows the tenant to file a complaint and request an inspection from the City. Mayor Amick asked if the percentage of rental property going down was due to the SFR Ordinance and Mr. Sample said he feels it is questionable whether it really went down or not. 002 4o Mr. Sample went on to say that he felt Mr. Ty Barron (landlord in The Colony) had almost offered him (Sample) and bribe in the amount of $1000.00 when he asked Mr. Sample if he could just purchase one license no matter how many homes he owned or managed in The Colony. Mr. Sample said that he resents the fact that he pays his landlord licensing fee while some landlords are refusing to pay theirs. Mr. Sample said that renting is a very good money making business~n'dthinks new tax laws are one of the reasons the landlords want this Ordinance changed, going on to say that large owners will be hurting and need to get rid of any method that is keeping records of the actual property owner. Mayor Amick asked if Mr. Sample's main concern was the upkeep of the property and Mr. Sample said he feels that the resident landlords do not mind the Ordinance but that the non-resident landlords do. Councilman Dye asked if Mr. Sample could see why a good landlord who pays the fee every year, has received no complaints, feel they are getting nothing for the money. Mr. Sample stated it is on $35.00 a year and in the end the I.R.S. pays half of that. Mayor Amick said that two people had been added for the enforcement of this Ordinance and the fees brought in were to offset the expense of those two people, making this a non-revenue producing item, going on to say that it was to be self-supporting. Mayor Amick said the intent is to hear both sides and the intent of the Ordinance is not revenue producing. Mr. Sample said the City has a unique opportunity to never have a slum area because there are only 3 houses int he City that are even 13 years old. Councilman Dye asked Mr. John Boyle, City Attorney, if the Ordinance is kep in force and those who don't pay are prosecuted, would there be a legal problem. Mr. Boyle said that these complaints are Class C Mis- demeanors and are filed in Municipal Court, which can be appealed to County Court,(which is as far as those cases can go) and then referred to the case regarding Mr. Ty Barron, which was appealed to County Court stating he had reviewed the case looking for validity or invalidity in the face of the Ordinance, and said he does not feel the Ordinance is invalid. Mr. Boyle said he does not agree with Judge Martin's ruling in that particular case, going on to say that while the Ordinance is still under study there would be no point in filing cases with the Muni- cipal Court that could be appealed back to Judge Martin's Court when we alreay know the Judge's feelings on the Ordinance, noting that Judge Martin's term is up DEcember 31, 1986. Mr. Boyle did say that if there was a serious enough problem between now and January 1987, to file the case in District Court. Councilman Poole asked how being a Court of Record would help and Mr. Boyle said that would stop the appeals to the County. Councilman Bradley asked Mr BOyle what cities have similar ordinances and Mr. Boyle stated Farmers Branch, Arlington, Trophy Club, and that the City of Dallas is currently working on one. Councilman Harris asked what happened to the or.iginal ordinance and why it was not passed. Mr. Sample stated the Mayor at that time was the manager of a real estate firm and the Council could not get the Ordi- nance past him. Councilman Harris said this ordinance addresses what he has had complaints on and would like to see the Ordinance amended to incorporate thse items. Councilman Harris went on to say that he did not wan to go back to court and lose and wanted some research done in order to know the City is on solid ground inlthis area. Councilman Harris also wanted to know what had been done since this decision regarding Barron came down in August, 1986, to correct the problems in the Inspecti6n Department. Mr. Bill Hall, City Manager said he had talked with the Inspections Dept. and there had been a lack of consistency in the SFR and CO inspections due to a lack of understanding in those areas. Mr. Hall said he has started disecting the SFR Ordinance and is going to be sure the inspectors are completely familiar with it and what it requires. Councilman Harris asked that the City Manager assign someone to check ads inlthe paper to find landlords and track them down. EMERGENCY AGENDA ITEM 1. CLOSED DOOR SESSION AS AUTHORIZED BY ARTICLE 6252-17, V.A.C.S., SECTION 2F, REGARDING LAND ACQUISITION, TO WIT: B. PLANO PARKWAY/I.B.M. Upon reconvening in open session and with no action to be taken regarding the Closed Door Session, the Council addressed the following item: 1. COUNCIL WORK SESSION REGARDING THE 1986/87 BUDGET Mayor Amick said he wanted to make everyone aware of the tax situation with I.B.M. and asked Mr. Hall to explain what is happening. Mr. Hall explained how the tax rate was levied for the City and M.U.D. at the City'/s assessed value of $488,000,000 which included $27,000,000 for I.B.M. property and stated that if we do not receive the full amount from I.B.M., we may face a shortfall of $100,000.00 in taxes. Mr. Hall said that I.B.M. had not been paying M.U.D. taxes, only City and they do not want to pay the full amount now. Mayor Amick said that a plus with the MUDICity merger was having the I.B.M. property taxed for both and that the MUD budget includes $100,000 and the City budget includes $114,000. taxes based on assessed value of $488,000,000, had afforded the overall tax reduction for the year. The Mayor asked Mr. Hall where the shortfall will affect the budget and Mr. Hall said the major impact would probably be in Maintenance and Operations. Councilman Harris stated that if the MUD Board had not figured their budget on the I.B.M. property this problme would not be occuring now, making note that the Council had asked them not do that for this reason. Mr. Hall said it really and nothing to do with MUD, stating the I.B.M.'s taxes were set on $88,000,000 assessed value, and the Council set the tax rate on $488,000,000 assessed value and had counted on the amount of revenue coming in through that assessed value. Mayor Amick said the budget had been passed including I.B.M. taxes again noting that I.B.M. had never paid taxes to MUD and now I.B.M. doesn't want to pay MUD taxes. The Mayor said the City budget balanced including I.B.M. and if MUD had remained separate they would not have counted on I.B.M. taxes and would not have had $100,000 to include in their budget. Councilman Harris said it was clear that the MUD B6ard used the valuation on the land when the City cautioned them not to and now the City's budget which was once balanced, is going to have o cover this shortfall. Councilman Poole mentioned that if the County tax roll back occurs the City will have to find $80,000.00 more. Mayor Amick said the Council needs to examine the options for recovering the money; 1) go to I.B.M and ask them to pay $212,000.00 over a 2 - 3 year period, which would mean not so large a shortfall this year, 2) rather than paying as a tax, make it as a donation to'_the City, which would exempt them from paying LISD and County taxes. Mr. John Boyle, City Attorney, reported on a meeting he held with Janice Carroll, Asst. City Mgr. and represetnatives from I.B.M, stating that I.B.M. feels a moral committment to the City as it was before the merger and feels they should pay the taxes to the City and continue with future taxes, but want 1986 taxes resolved. Mayor Amick said there are other alternatives; 1) make budget cuts to cover the shortfall, 2) raise the water rates to cover. Mr. Hall said that he doesn't think we will have to resort to that, referencing his memo to Council regarding the Fund Balance (page 4) Mr. James England, Finance Director, said the real problem is about $50,600.00 and reserve less than amount is $95,000.00, which is very low stating that is only 2.5% and it should be 5%. Mr. England pointed out on page 6 of the memo one budget unkown; The Aquatic Park, stating that the figures are very erratic. Mayor Amick asked for a financial report and Mr. England said that already been done. The Mayor asked for that report as soon as possible and stated that the pool may have to shut down except for school functions. Mayor Amick asked about agreement with LISD and Ms. Janice Carroll stated that they are still negotiating, going on to say that the estimated value of school use of the pool is $6600.00 weekly. Mr. Hall said it is very important not to "cry wolf" but wanted the Council to be aware of the potential for problems, stating that he feels they can be worked out. Mayor Amick said that if there is no settlement then the Council needs to know where the $100,000 in cuts would come from. Mr. Ha~l stated that he is aware and shares that concern. The Mayor asked for the overview on December 1 and Councilman Harris said it would be better to wait until december 15 and then if necessary review possible cuts. Mayor Amick then proposed ahiring freeze of any new employes until the tax question is resolved and all council agreed. The Mayor also asked for a written outline of the projected effect on the budget if the County tax roll back happens. Mayor Amick asked if the propsed Capital Improvements had, been done and Mr. Hall said some of them have been.~ The Mayor wanted to know how much money was left and Mr. Hall responded 1½ million. The Mayor asked if the $100,000.00 could come from that account and Mr. Hall said is possible and that he would investigate. Mayor Amick also said that all ~ew projects and major cost items should be postponed. EMERGENCY AGENDA ITEM 1. CLOSED DOOR SESSION AS AUTHORIZED BY ARTICLE 6252-17, V.A.C.S., SECTION 2E, REGARDING LITIGATION, TO WIT: A. PENDING LITIGATION WITH OLSON CONSTRUCTION COMPANY REGULAR.AGENDA, ITEM 2. CLOSEDDOOt~SESSION AS AUTHORIZED BY ARTICLE 6252-17, V.A.C.S., SECTION 2G, REGARDING PERSONNEL, TO WIT: STAFFING Upon reconvening in Open Session and with no action to be taken regarding the Closed Door Session, Councilman Harris moved to adjourn and Councilman Bradley seconded the motion which carried with all members voting Aye. Mayor Amick adjourned the meeting at 12:05 a.m. APPROVED: Do~'~mic~, Mayof~ ...... ATTEST: ..~t~,!~s], Ci t~ SeCCe~ry