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HomeMy WebLinkAbout2026-009 Capital Improvements Advisory CommitteeNovember 7, 2025 Report No. 2025-009 INFORMAL STAFF REPORT TO MAYOR AND CITY COUNCIL SUBJECT: Capital Improvements Advisory Committee SUMMARY: SB 1883 was approved as part of the 89th Legislative Session, amending several sections of Texas Local Government Code (TLGC) Chapter 395 relating to the collection of impact fees and establishment of a Capital Improvements Advisory Committee (CIAC). As a result of these changes, the City of Denton is required to create a new body to serve as the CIAC, ensuring the establishing ordinance satisfies the requirements of the State Statute. BACKGROUND: At the September 30, 2025 City Council Work Session, staff provided City Council with an overview of SB 1883 which was approved as part of the 89th Legislative Session and amended several sections of Texas Local Government Code (TLGC) Chapter 395 relating to the collection of impact fees and establishment of a Capital Improvements Advisory Committee (CIAC). As part of the discussion, staff provided a summary of provisions in TLGC Chapter 395, specifically the requirements surrounding establishment of a CIAC that existed prior to the 89th legislative session and the City of Denton’s current CIAC. Staff concluded the presentation by providing a summary of changes needed to the composition of the CIAC as a result of recent amendments to the State Statute and sought Council direction on the creation of a new CIAC Ordinance. A summary of the information provided during Work Session may be found in the “CIAC History” portion of this report. During the Work Session Discussion, City Council reached consensus on the following staff recommendations relating to the establishment of the CIAC: • Given the requirements that a minimum 50 percent of the membership of the CIAC be comprised by a representative of the real estate, development, or building industries and that these representatives may not be employees or officials of the political subdivision, a new Committee shall be created to serve as the CIAC rather than appointing an existing body to serve in this capacity. • Submittal of a resume shall be required prior to an individual being appointed to the CIAC to assist in monitoring compliance with the specific membership requirements of this body. • A body of eight members shall be appointed, allowing each member of City Council to have an at-large appointee. It is important to note that the CIAC must also include one representative from the Extraterritorial Jurisdiction (ETJ). During the Work Session discussion, City Council inquired if staff could nominate the representative of the ETJ. Staff stated they could not nominate representatives but could inform Council of individuals who may be interested in the position so that they could bring forward a November 7, 2025 Report No. 2025-009 nomination. In addition, staff indicated there is currently an ETJ representative serving on the CIAC and staff would contact this representative to inquire if they had interest in continuing to serve. Staff could then inform Council of their interest, and at that time a member of Council could nominate the individual. Any member of Council may nominate a representative from the ETJ to fulfil membership requirements. • Term lengths shall be four years for CIAC members and shall be staggered so that appointees of odd number places (Places 1, 3, 5, and 7) end on Augst 31st of odd ending years and appointees of even number places (Places 2, 4, and 6) and the ETJ member’s term end on August 31st of even ending years. In addition, City Council requested to add the following requirements relating to CIAC membership to the establishing ordinance: • Members of the CIAC shall be at least 21 years of age in order to serve on the Committee; and • Members of the CIAC are required to have been a resident of the City of Denton for at least two years prior to being eligible to serve on the Committee. This provision would not apply to the member of the CIAC representing the ETJ. At the November 18, 2025 City Council meeting, staff will bring forth an ordinance for Council consideration establishing the CIAC and incorporating the above Council agreed upon provisions relating to establishment and membership of the Committee. CIAC History: TLGC Chapter 395 authorizes the collection of impact fees to be charged to new developments to offset the costs of capital improvements related to water, wastewater, and roadway improvements. In order to assess impact fees, Chapter 395 requires the establishment of a Capital Improvements Advisory Committee to review and comment on land use assumptions, capital improvement plans, and proposed impact fees. Section 395.058 sets forth the requirements for the establishment and composition of the CIAC. Due to recent passage of SB 1883 and updates to the State Statute regarding the composition of the CIAC, staff will be bringing forth a work session item to seek direction from City Council regarding establishment of a new Capital Improvement Advisory Committee (see Exhibit 1). Prior to the 89th Legislative Session, TLGC Section 395.058(b) specified the CIAC be composed of not less than five members appointed by the governing body of the political subdivision. Of this body, not less than 40 percent of the CIAC membership was required to be representatives of the real estate, development, or building industries who are not employees or officials of a political subdivision or governmental entity. Section 395.058(b) also allowed for cities with a Planning and Zoning Commission, to utilize the Commission as the CIAC provided the Commission included at least one representative of the real estate, development, or building industry who is not an employee or official of a political subdivision or governmental entity. Furthermore, in cities where impact fees were applied to areas within the extraterritorial jurisdiction (ETJ), a representative of this area was required to be included in the CIAC. The City of Denton has implemented impact fees for water and wastewater infrastructure since 1998, and for roadway improvements since 2016. With the implementation of water and November 7, 2025 Report No. 2025-009 wastewater fees in 1998, and the subsequent updates, the City of Denton utilized the Planning and Zoning Commission as the CIAC. In 2018, as a requirement before updating impact fees, the City Council approved Ordinance 18- 411 appointing the Planning and Zoning Commission, plus one ad hoc member from the ETJ, as the Capital Improvement Advisory Committee pursuant to Texas Local Government Code 395.058 (see Exhibit 2). The adopting ordinance specifies the roles of the CIAC are to: • Advise and assist the City Council in adopting land use assumptions; • Review the capital improvements plans and file written comments; • Monitor and evaluate implementation of the capital improvements plan; • File semiannual reports with respect to the progress of the capital improvements plan and reports to the political subdivision any perceived inequities in implementing the plan or imposing the impact fee; and • Advise the City Council of the need to update or revise the land use assumptions, capital improvements plan, and impact fee. Given the above-mentioned responsibilities of the CIAC, the Committee currently meets twice a year to review the semiannual reports on the progress of the capital improvements plan. The Committee may be asked to increase meeting frequency when the City is reviewing and updating impact fees. SB 1883 went into effect September 1, 2025 and amends several sections of TLGC 395, including Section 395.058(b) by removing language within the subsection which authorizes the use of the Planning and Zoning Commission as the CIAC. Furthermore, 395.058(b) was also amended to specify that minimum of 50 percent of the membership of the CIAC shall be comprised by a representative of the real estate, development, or building industries. Representatives may not be employees or officials of the political subdivision. These changes, coupled with the requirements in the City Charter Section 10.02 that members of the Planning and Zoning Commission shall not hold any other public office or position in the City while serving on the Planning and Zoning Commission, necessitate the establishment of a new CIAC for the City of Denton. Requirements specified in SB 1883 will also affect how frequently the CIAC may need to meet, particularly when evaluating new impact fees. SB 1883 amends TLGC 395 by adding Section 395.059 which requires cities to conduct an independent financial audit prior to the adoption of a new impact fee for services areas where a fee had previously been adopted. This report must be performed by an independent auditor, certified by the Texas State Board, and not previously employed by the political subdivision in the last 12 months. Section 395.05(c) details the components the independent audit must detail, including but not limited to, fees collected, fees assessed, proposed capital improvements or facility expansions financed from fees collected, and fees collected but not yet spent. The findings of this audit must be presented to the CIAC prior to the increase of an existing impact fee or adoption of a new one. ATTACHMENTS: November 7, 2025 Report No. 2025-009 Exhibit 1 – SB 1883 Exhibit 2 – Ordinance No. 18-411 STAFF CONTACT: Angie Manglaris, AICP Assistant Planning Director, Development Services angie.manglaris@cityofdenton.com REQUESTOR: Staff Initiated STAFF TIME TO COMPLETE REPORT: 3 hours PARTICIPATING DEPARTMENTS: City Manager’s Office, Development Services Department, City Secretary’s Office, City Attorney’s Office O*>*=Jk*=-44/ =J =?P nah]pejc pk pda ]llnkr]h kb h]j‘qoa ]ooqilpekjo(_]lep]h eilnkraiajp lh]jo(]j‘eil]_p baao* >A EP AJ=?PA@ >U PDA HACEOH=PQNA KB PDA OP=PA KB PAT=O6 OA?PEKJ=-*==Oa_pekj /51*,0/(Hk_]h Ckranjiajp ?k‘a(eo ]iaj‘a‘pk na]‘]o bkhhkso6 Oa_*=/51*,0/*==EJBKNI=PEKJ =>KQP H=J@ QOA =OOQILPEKJO =J@ ?=LEP=H EILNKRAIAJPO LH=J =R=EH=>HA PK LQ>HE?*=p ha]op 2,‘]uo WKj knY ^abkna pda ‘]pa kb pda benop lq^he_]pekj kb pda jkpe_a kb pda da]nejc kj pda h]j‘qoa ]ooqilpekjo ]j‘_]lep]h eilnkraiajpo lh]j( pda lkhepe_]h oq^‘ereoekj od]hh i]ga ]r]eh]^ha pk pda lq^he_epo h]j‘qoa ]ooqilpekjo(pda peia lanek‘kb pda lnkfa_pekjo(]j‘] ‘ao_nelpekj kb pda _]lep]h eilnkraiajp b]_ehepeao pd]p i]u ^a lnklkoa‘* OA?PEKJ=.*==Oa_pekj /51*,1-$]%(Hk_]h Ckranjiajp ?k‘a(eo ]iaj‘a‘pk na]‘]o bkhhkso6 $]%==Pda lkhepe_]h oq^‘ereoekj(sepdej /,‘]uo ]bpan pda ‘]pa kb pda lq^he_da]nejc kj pda eilkoepekj kb ]j eil]_p baa(od]hh ]llnkra kn ‘eo]llnkra pda eilkoepekj kb ]j eil]_p baa*=llnkr]h kb pda eilkoepekj kb ]j eil]_p baa ^u ]lkhepe_]h oq^‘ereoekj namqenao ]j ]bbeni]pera rkpa kb psk)pden‘o kb pda iai^ano kb pda ckranjejc ^k‘u kb pda lkhepe_]h oq^‘ereoekj* OA?PEKJ=/*==Oq^_d]lpan ?(?d]lpan /51(Hk_]h Ckranjiajp ?k‘a(eo ]iaj‘a‘^u ]‘‘ejc Oa_pekj /51*,1-1 pk na]‘]o bkhhkso6 - 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'' . - . • -• r . - • ! i • ' - , : , w ` . 1 ! , -. . . 1) advise and assist the City Council in adopting land use assumptions; 2} review the capital impravements plans and file written comments; 3) manitor and evaluate implementation of the capital improvements plan; 4) file semiannual reports with respect to the progress of the capital improvements plan and report to the political subdivision any perceived inequities in implementing the plan or imposing the impact fee; and 5} advise the City Council of the need to update or revise the land use assumptions, capital improvements plan, and impact fee; and WHEREAS, the City Council desires that the Planning and Zoning Commission of the City of Denton, Texas, consisting af seven (7) members, act as the advisory committee since the Commission has mare than one (1) representative af the real estate, development, or building industry wha are not employees ar officials of a political subdivision or governmenial entity; which Commission shall constitute a portion af the membership of the Capital Impravements Advisory Committee as provided by law; and WHEREAS, the City Council desires that any authorized impact fees be applied in the extraterritarial jurisdiction of the City of Denton, Texas; therefore ane (1) additional ad hoc vating member af the Capital Improvements Advisory Committee must be selected from the extraterritorial jurisdiction of the City of Denton; and NOW THEREFORE: THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The recitations which are set forth above in this Ordinance are expressly incorporated by reference herewith, as if made a part of this Ordinance. SECTION 2. The City Council establishes the Denton Capital Improvements Advisory Committee pursuant to Texas Local Government Code §395.058 as a prerequisite of authorizing impact fees. SECTION 3. The Denton Capital Improvements Advisory Committee shall consist of eight members; seven shall be the members of the City of Denton Planning and Zoning Commission and one shall be appointed ad hoc from the extraterritorial jurisdiction of the City of Denton, Texas. All eight (8) members of the Capital Improvements Advisory Committee shall be voting members thereo£ The terms of the members shall parallel those terms of the City of Denton Planning and Zoning Commission, except that the ad hoc member from the extraterritorial jurisdiction of the City of Denton, Texas shall serve a term of two (2) years and shall be appointed in odd-numbered years. SECTION 4: Robin Harris, P.E., a person residing in the extraterritorial jurisdiction of the City of Denton, Texas, is well-qualified to serve, and is accordingly appointed as an ad hoc voting member of the Capital Improvements Advisory Committee. SECTION 5. It is understood that the ad hoc member from the extraterritorial urisdiction of j the City of De c:, °";, appointed in Section 3 above, shall have no authority to serve or deliberate a.i r 1,° of the Planning and Zoning Commission of the City of Denton, and shall serve only as a member of the Capital Improvements Advisory Committee. S}^°"N f 1 ' The duties of the Capital Improvements Advisory Committee shall consist of the requirements listed in Texas Local Government Code §395.058(c) and (d) as currently written, and any other duties as may be required by amendment of that statute. f p i J, The City Council designates procedural rules for the Capital Improv "a vi ry Committee to follow in carrying out its duties by requiring it to follow the City Council Rules of Procedure as set forth in Section 2-29, Code of Ordinances, City of Denton, as amended, and adopting those procedural rules as the rules of the Advisory Committee. SECTION 8. This ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the %a r day of March, 2018, m ITT . _. . m..... ....x CHRI a S, MAYOR ATTEST: P 1 f l'"L,l.. WALTERS, CITY SECRETARY BY m : C n f '' A '1`( LEGAL FORM: AARON LEAL, CITY TTORNEY BY: _ ..__ . , . e ..w _.