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Minutes August 25, 1987231t CITY OF DENTON CITY COUNCIL MINUTES August 25, 1987 The Council convened into a special called meeting at 5:15 p.m. in the Council Chambers. PRESENT: Mayor Stephens; Mayor Pro Tem McAdams; Council Members Ayer, Boyd, Gorton and Hopkins. ABSENT: Council Member Alexander Public Hearings A. The Council considered a petition of Donald R. Curtis and City of Denton for annexation of a 9.2154 acre tract of land being part of the J. Early Survey, Abstract No. 1279, and the Moreau Forrest Survey, Abstract No. 417, and being located at the northeast corner of Mingo Road and North Cooper Creek Road. (A-47) The Mayor opened the public hearing. No one spoke in favor of the petition. No one spoke in opposition of the petition. The Mayor closed the public hearing. Cecile Carson, Urban Planner, stated that this was a vo. luntary request by Mr. Curtis with additional property being annexed by the City of Denton. Two reply forms were mailed with none returned. Staff recommended continuing the annexation process. Consensus of the Council was to continue the annexation process. B. The Council considered a petition of City of Denton for annexation of a 24.3957 acre tract of land being part of the J. Ayers Survey, Abstract No. 2, and part of the B. Burleson Survey, Abstract No. 65, and being located west of 1-35 and north of intersection of Rector Road. (A-50) The Mayor opened the public hearing. No one spoke in favor of the petition. Mr. Junior Kreps, Duininck Brothers, spoke in opposition. He stated that this was a highway contract with the I35 project. He requested a slight delay in the public hearing as his attorney was not yet present. Consensus of the Council was to grant a delay in the public hearing. Council Member Alexander joined the meeting. 236 City of Denton City Council Minutes August 25, 1987 Page 2 2. Ordinances A. The Council considered adoption of an ordinance and service plan instituting annexation of 73.334 acres of land being part of the M. Forrest Survey, Abstract No. 417. (A-43) The following ordinance was considered: No. 87- AN ORDINANCE ANNEXING A TRACT OF LAND CONTIGUOUS AND ADJACENT TO THE CITY OF DENTON, TEXAS: BEING ALL THAT LOT, TRACT OR PARCEL OF LAND CONSISTING OF APPROXIMATELY 73.334 ACRES OF LAND LYING AND BEING SITUATED IN THE COUNTY OF DENTON, STATE OF TEXAS AND BEING PART OF THE M. FORREST SORVEY, ABSTRACT NO. 417, DENTON COUNTY, TEXAS: CLASSIFYING THE SAME AS AGRICULTURAL "A" DISTRICT PROPERTY: AND DECLARING AN EFFECTIVE DATE. Lloyd Harrell, City Manager, stated that all of the ordinances presented tonight were voluntary annexations connected with the Lakeview Development. McAdams motion, Hopkins second to adopt the ordinance. On roll voter McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. B. The Council considered adoption of ordinance and service plan instituting annexation of 2.822 acres of land being part of the M. Forrest Survey, Abstract No. 417. (A-44) The following ordinance was considered: NO. 87- AN ORDINANCE ANNEXING A TRACT OF LAND CONTIGUOUS AND ADJACENT TO THE CITY OF DENTON, TEXAS: BEING ALL THAT LOT, TRACT OR PARCEL OF LAND CONSISTING OF APPROXIMATELY 2.822 ACRES OF LAND LYING AND BEING SITUATED IN THE COUNTY OF DENTON~ STATE OF TEXAS AND BEING PART OF THE M. FORREST SURVEY, ABSTRACT NO. 417, DENTON COUNT, TEXAS: CLASSIFYING THE SAME AS AGRICULTURAL "A" DISTRICT PROPERTY: AND DECLARING AN EFFECTIVE DATE. McAdams motion, Alexander second to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "ayes" Ayer "ayes" Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. City of Denton City Council Minutes August 25, 1987 Page 3 C. The Council considered adoption of ordinance and service plan instituting annexation of 1.834 acres of land being part of the G. Walker Survey, Abstract No. 1330. (A-45) The following ordinance was considered: NO. 87- AN ORDINANCE ANNEXING A TRACT OF LAND CONTIGUOUS AND ADJACENT TO THE CITY OF DENTON, TEXAS: BEING ALL THAT LOT, TRACT OR PARCEL OF LAND CONSISTING OF APPROXIMATELY 1.834 ACRES OF LAND LYING AND BEING SITUATED IN THE COUNTY OF DENTON, STATE OF TEXAS AND BEING PART OF THE G. WALKER SURVEY, ABSTRACT NO. 1330, DENTON COUNTY TEXAS, CLASSIFYING THE SAME AS AGRICULTURAL "A" DISTRICT PROPERTY: AND DECLARING AN EFFECTIVE DATE. McAdams motion, Hopkins second to adopt the ordinance. vote, McAdams "ayev" Alexander "aye," Hopkins "aye," "aye," Ayer "aye," Boyd "aye," and Mayor Stephens Motion carried unanimously. On roll Gorton "aye." The Council returned to Item #i.B. Dick Kelsey, attorney representing the Duininck Brothers, stated that this was a construction project for the interstate improvements from the Cooke County line to Lake Dallas. The construction contract was from the State of Texas and the United States Government to construct improvements and only for that reason. The project would take a minimum of 2 1/2 years to a maximum of 4 1/2 years depending on the construction project. Duininck Brothers had a dispute with. the City as to whether the project was a subdivision. They did not own any property, had not purchased any property, did not have any options to purchase any property, and did not intend to purchase any property. They had a short term lease only. The property was being used as a construction material site and a construction improvement site for the construction of the improvements on the highway. His position on the annexation was that an annexation should be bona fide.. It should be for the purpose of bringing land into the City to make it a part of the City. They felt it was unfair and a possible violation of the rights of the people who owned and occupied the property when the sole purpose of bringing the property into the City was to exercise zoning control over the property. The use was perfected in the area and ha~ been used for a number of months for the construction site. It would be vacated and returned to its normal condition when the project 237 2 3'8 City of Denton City Council Minutes August 25, 1987 Page 4 was completed except for the option of keeping the metal shed which was currently an equipment barn. He challenged the City staff to tell them how they were going to provide services that would be of any value to the property. This was a controlled situation, a power play by the City and objected on those grounds. He did not feel that this was an honest attempt to annex property to be used by the City. He requested denial of the annexation. Junior Kreps stated that he did not know of the existence of the ETJ and had talked with the County who stated that there was no zoning in the area. He asked why annex 3 1/2 miles from the existing City services. Council Member Boyd stated that the' materials indicated that the site was for a proposed batch plant and Mr. Kelsey indicated that the use had been perfected, had the plant already started operation. Kreps stated that a shop had been built and the site was being used for various purposes, but not for concrete. Permits had been applied for and materials would be delivered to the site. Council Member BOyd asked if the property were annexed, would Kreps have a problem with City zoning if the usage of the property were grandfathered. Kreps stated that he would not object if he would be allowed to use the property as he had planned for at that point. He was concerned with possible changes in the future. The Mayor closed the public hearing. Cecile Carson, Urban Planner, stated that the 1000' strip would connect to a similar annexation completed the week before. It was similar to previous annexations for potential land use control and establishment of boundaries. Neighbors in the area had asked the City to use its authority to control the land use. The Texas Air Control Board stated that a permit had been requested for a concrete batch plant but had not been approved at that time. The State legislature had amended the regulations regarding public hearings which were not required if the property were contiguous to a state right-of-way. An asphalt plant had been denied by the State and no appeals had been presented at that time. Planning and Zoning was scheduled to hear the case August 26, 1987. If a permit were granted, Carson was not sure of grandfathering the plant. Mr. Lewis of the Texas Air Control Board had told staff that the permit was requested for issuance in October but no use until April. City of Denton City Council Minutes August 25, 1987 Page 5 Dick Kelsey stated that the asphalt permit had not been denied, it had not been pursued by Kreps. He stated that they were willing to make any allowances that the City required to assure the usage of the property. Consensus of the Council was to continue with the annexation. 3. The Council considered a formal response to the County's offer of sale of its interest in Flow Memorial Hospital and other issues raised in the County's letter of August 17, 1987. Council Member Gorton left the meeting. Lloyd Harrell, City Manager, reviewed the options available to the City and the City Council as stated in the August 21, 1987 meeting. Council Member Alexander asked if the public had an opportunity to speak at the August 21, 1987 meeting. Council Member Hopkins replied that there had been no public hearing on that date. Alexander stated that it would be helpful to have citizen views to take into account before the Council continued too far along on the Flow Hospital issue. He stated that the options outlined by the City Manager were reasonable considering the alternatives the County had presented the City. It was necessary to evaluate the importance of having a public hospital within the City of Denton. Every option needed to be searched to keep Flow operational and viable as a public health institution in the City of Denton. He felt that prior to the election the hospital district was the most viable decision for Flow but that option did not occur. He felt that the City was making a good decision in considering the option to increase the tax rate by $.02 to keep an opportunity for the City to have flexibility in the budget process to help make Flow a viable institution over the next several months. Flow needed to be stabilized before anything could be done with it at all. It was important to recognize that the County also had an obligation to Flow which was significantly greater than that of the City's obligation. It was a county-wide public hospital and the County represented a significantly larger portion of the tax base than did the City of Denton. He felt it was appropriate that the City respond to the returns of the election by giving consideration to raising the tax rate by $.02 and indicating the City's willingness to support Flow Hospital. But the County also had to recognize its responsibility and seriously consider adjusting its tax rate 240 City of Denton City Council Minutes August 25, 1987 Page 6 with the funds necessary to provide stability for Flow. The dual ownership of Flow between the City and County had plagued Flow for a number of years. No solution for Flow would ever be found that did not deal with that structural problem. It was important to respond to the County by saying that the City was willing to sit down and effectively negotiate with the County all of the mentioneQ options including the sale/transfer or perhaps the City assuming a larger portion of the ownership of Flow. He was not inclined for the City of Denton to be in the hospital business. He felt the Council needed to proceed with the $.02 increase in the taxes, encourage the County to respond in kind and appoint a delegation from the Council to meet with a delegation from the County to seriously look at alternatives within the next week to 10 days. Mayor Stephens stated that the Council had already approved a negotiating team of the City Manager and the Mayor. Mayor Pro Tem McAdams stated that she would like to hear some remarks from the people in the audience. Her remarks were the same as on August 21, 1987 including City ownership of the hospital. Council Member Hopkins was concerned that the meeting was not scheduled as a public hearing and someone might misinterpret the Council asking for citizen input at that time. She stated she had not changed her opinion from the August 21, 1987 meeting. In no way did she feel the City could undertake the liability for Flow Hospital and could not vote for the option for the City to take over the Hospital. Additional concerns she felt were that if the Hospital were to remain a public hospital, it could not turn anyone away for heal.th care and thus the City would be funding health care .for the entire county. Since Friday she had spoken to several doctors who stated that Flow would never be able to keeping going without a patient census. She could agree to the $.02 tax increase if she were shown that the money was doing something other than prolonging the hospital's demise 30-60 days. Council Member Boyd agreed with Council Member Hopkins that the Council needed to be fiscally responsible in regards to Flow Hospital. Flow needed to succeed. The City should not accept full liability for the expense of Flow. Flow was not a valuable institution only to the City of Denton. It was a valuable institution to a number of groups in the City. The City should be willing to carry its part of the burden but the other institutions in the County should also carry their part of the burden. The City should reject the offer that the County had made. He felt that the County intended it to be rejected. The Council should explore City ownership but the City of Denton City Council Minutes August 25, 1987 Page 7 City should not be full guarantor. In order for the City to own the Hospital, other institutions needed to be involved at least in a contractual way that would insure the success of Flow. The City should not be the only group involved in trying to make Flow work. Council Member Ayer stated the number one goal was to save Flow Hospital and that the Council should go as far as it possibly could while remaining fiscally responsible. He would like to have a puDlic hearing on Flow Hospital if the time would permit. He felt that the first step would be to initiate the process of adding the $.02 tax increase which would again express the intention of the City to provide more than its fair share to Flow Hospital. Secondly, the City should go back to the County for further negotiations. The County needed to be reminded that all of the people who lived in the City of Denton also lived in the County of Denton and paid Denton County taxes. He did not believe that the City should assume all of the fiscal responsibility for Flow but was not opposed to the idea of the City becoming the sole owner of Flow. He added that he would like to add Council Member Alexander to the negotiating team. Hopkins second the motion. Consensus of the Council was to add Council Member Alexander to the negotiating team. Mayor Stephens felt that an outstanding problem was the suit that the County had filed against the City of Denton. He felt not much could be settled in a permanent way until the litigation had been completed because it would settle the legal responsibility of each entity to the group. For immediate importance it was necessary to see how the City and the County could work together to bring about a sense of permanence of the Hospital. He would like to settle the issue of litigation first for moral purposes and for the continuation of Flow Hospital on the short term as the City worked for the long term solution. Debra Drayovitch, City Attorney, stated that at the meeting of August 18, 1987, Mayor Pro Tem McAdams asked what the City's obligation would be to people outside the City limits if the City took over the ownership of the hospital. Unless the State were to approve changes, the hospital would still have a legal obligation to serve the entire County. Mayor Pro Tem McAdams asked if the law remained the same, would the City have the ability to bill other institutions. Drayovitch replied that the County'~ position wa~ that whatever responsibility they had at the present would continue if the City assumed full ownership. Right now the Hospital had the 242 City of Denton City Council Minutes August 25, 1987 Page 8 right to bill other hospital districts and counties for services rendered. Mayor Pro Tem McAdams stated that even if the hospital were sold, the $.02 would be put in towards Flow. A lawsuit was pending against the City based on Senate Bill 1 which suggested that the City was liable for a portion of indigent care. No money was currently buageted for indigent care should the lawsuit find the City liable. Mayor Stephens asked the City Manager and the City Attorney to assist him in drafting a formal response to the County based on the responses given by the Council Members. Council Member Alexander stated the Council needed to first focus on the stabilization of Flow if for no other reason than the potential negative economic impact upon both the City and the County of the closin9 of Flow Hospital. Council Member Boyd stated that he felt the County realized the importance of maintaining Flow Hospital and saw the advantage of a public hospital in terms of services and fees to the residents of Denton County. He felt the City should emphasize to the County that it agreed with that and build on that premise. He felt that the formal response should state that the proposal was unacceptable. Mayor Stephens allowed members of the audience to speak to the Council regarding Flow Hospital. Pat Brewer stated that there had never been any discussions on the fact that Flow Hospital did not have to remain as it currently was. Changes could be made. In the month of July, a profit of approximately $30,000 was made. Stability in Flow Hospital was the problem. The hospital was loosing viable services which would be difficult to retrieve in the future. She stated that some of her patients had made calls to their City Council representatives and County Commissioners. Those people called Mr. Linton who instructed the nurses to tell their patients not to call their representatives. Dorothy Damico stated that she felt there was no communication among the people who w~nt to resolve the problem of Flow. She encouraged hasty communication among those entities responsible for Flow so that a resolution could be made for Flow. Patrice Kapon stated that as of September 3 at midnight the obstetric department would be closed not because of the nursing staff leaving but because of the doctors not willing to deliver indigents for free. City of Denton City Council Minutes August 25, 1987 Page 9 Elinor Hughes urged the Council in negotiations to include all interested parties such as the Hospital Board, Hospital staff and doctors on staff. The Hospital needed to be monitored very closely even on a twice a day basis to see what was happening so as not to be lulled into believing the Hospital would wait indefinitely for something to happen. Dr. Jim Killingsworth stated that it was exceptional to see the Council's reserve in the crisis. They were not rushing into a solution without looking at all the options for the Hospital. He hoped that the Council would be empirical and look at other models of public hospitals. Bob Powell stated that he was against the hospital district but was in full support of Flow Hospital. He felt that the hospital needed to go back to the basics. The Flow Board was too large, open bidding for projects done at Flow was not followed and the Hospital was not run in a business-like manner. He felt that political pressure needed to be applied to the County Commissioners on a county-wide basis or at least a city-wide effort to convince them to give full support to Flow. Mayor Stephens thanked everyone for their comments and stated that they would be remembered during future discussions. Council Member Gorton returned to the meeting. 4. The Council held a record vote on a proposal to consider a tax rate increase of 11.13% above the effective tax rate. Lloyd Harrell, City Manager, stated that the vote followed the instructions given to start the process to permit the Council at a later date to establish the City tax rate at $.61 per ~100 valuation rather than $.59 per $100 valuation as was contained in the proposed budget. This would give the Council flexibility later if it decided to set the rate at $.61 to budget $400,000 to allocate for the support of Flow Hospital. Alexander motion, McAdams second to set the $.61 tax rate as a ceiling which would be an effective tax rate increase of 11.13%. On roll call vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. 5. The Council set the dates for public hearings for the 1987-88 ad valorem tax increase. Lloyd Harrell, City Manager, stated that the suggested date would be September 8, 1987 at 7:00 p.m. in the Council Chambers. City of Denton City Council Minutes August 25, 1987 Page 10 Consensus of the Council was to set the date of September 8, 1987. 0 The Council did not convene into the Executive Session. With no further business, the meeting was adjourned. CITY ~ DENTON, TEXAS J~N IF'~.R~rA~TERS C~Y SECRETARY CITY OF DENTON, TEXAS 2736C