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Minutes December 19, 1989310 CITY OF DENTON CITY COUNCIL MINUTES DECEMBER 19, 1989 The Council convened into the Work Session at 5:15 p,m. in the Civil Defense Room. PRESENT: Mayor Stephens; Mayor Pro Tem Ayer; Council Members Alexander, Boyd, Gorton, Hopkins and McAdams. ABSENT: None 1. The Council convened into the Executive Session to discuss legal matters (considered action in Denton County vs. City and In Re: Flow), real estate and personnel/board appointments (considered an appointment to the Building Code Board). 5:45 p.m. The Council then convened into open session. 1. The Council received a report on the telephone system from ~Mel Horne of Doug Arnold, Ltd. Lloyd Harrell, City Manager, reviewed the history of the ~ystem and the process involved in choosing a new system. Mel Horne, Doug Arnold, Ltd., stated that the present system was at capacity and had out lived its usefulness. There was no control of long distance costs and an extensive use of off-premise extensions. Four bids were received for a new system with GTE being the low bidder. The new system would have increased capacity as well as features such as automatic route selection, call detail recording and reporting, automatic call distribution, voice mail, battery backup, music on hold, message waiting light and TI carrier service. Horne reviewed the technical aspects of the four systems and recommended that the Council approve the bid from GTE. 2. The Council received a report and gave direction to City staff regarding solid waste charges and licensing fees. Lloyd Harrell, City Manager, stated that staff was developing specifications for bids for exclusive and non-exclusive providers for solid waste collection. This process would take approximately four to five months to complete. Council had asked for a survey regarding what was being charged in surrounding communities in order to determine if an interim license fee and a small rate increase should be implemented in the City of Denton. This license fee and rate increase would allow the City to break even during the budget year. Staff was recommending a fee between 5-10% and was asking for Council direction. City of Denton City Council Minutes December 19, 1989 Page 2 Jerry Cott, Government Relations Committee-Chamber off, Commerce, suggested that a franchise fee be placed on both City and private haulers. City Manager Harrell replied that certain projects such as City beautification and recycling was sponsored by the Solid Waste Department and thus was contributing more than a franchise fee would cover. Consensus of the Council was to have staff prepare the documents necessary for the license fee and rate increase for the next regular Council meeting. 3. The Council received a briefing on and discussed pr'oposed revisions to the contracts for hotel/motel occupancy tax recipients and the hotel tax ordinance and considered extending current contracts through January, 1990. Debra Drayovitch, City Attorney, presented a summary of Council Committee recommendations and how the proposed contracts differed from the current contracts. Under present contracts, hotel tax revenues were paid to three entities: the Chamber of Commerce, the North Texas Fair ASSociation, and the Denton Cultural Confederation. The Chamber and the North Texas Fair ASSociation did not regularly fund other agencies from hotel tax revenue. The Denton Cultural Confederation, was established as a conduit to distribute hotel tax revenue to the Greater Denton Arts Council, the Denton County Historical Foundation, and the Denton County Historical Museum. The Council Committee recommended that the City have contracts with each of the five entities regularly receiving hotel tax revenue. The Council Committee also felt that if the City were to continue to pay hotel tax revenue to the Arts Council for the renovation of the Steam Plant building, the City should have two contracts with the Arts Council, one relating to the renovation project and one relating to the promotion of the arts. Staff had developed an alternative to the proposed contract for the renovation project. The City Council might want to consider simply retaining the one percent in a separate account for that purpose. The Council Committee recommended separate contracts for the Denton County Historical Museum and Denton County Historical Foundation with an allocation of the one percent between them. Those two entities had agreed to the separate contracts. Other changes based on revisions in the State law and the Committee's recommendations were (1) defined hotel tax revenues, (2) added a provision that hotel tax revenue may be spent for administrative costs only if they were 'incurred directly' in performing authorized activities, (3) added a provision that revenue may not be spent for travel unrelated to an authorized activity or job performance, (4) added a provision that the agency submit and Council approve 311 312 City of Denton City Council Minutes December 19, 1989 Page 3 in advance the annual budget, (5) added a provision.~requiring an agency to maintain a separate account for the funds received and prohibited commingling with other funds, (~)' added a provision that the City Manager be given notice of the meetings of the governing bodies of recipients, and that those meetings be open to the City Manager. Consensus of the Council was to continue a work session discussion at the next regular Council meeting before meeting with each entity to discuss provisions of the new contracts. Current contracts would be extended through January 1990. The Council then convened into the Regular Session at 7:00 p.m. in the Council Chambers. PRESENT: Mayor Stephens; Mayor Pro Tem Ayer; Council Members Alexander, Boyd, Gorton, Hopkins and McAdams. ABSENT: None Mayor Stephens presented Bob Nelson, Executive Director for Utilities, a plaque of appreciation from the Texas Municipal League. 1. The Council considered approval, of the minutes of the Regular Session of September 19, 1989, November 7, 1989, the Joint Session of November 13, 1989, the Executive Session of November 15, 1989, and the Regular Session of November 21, 1989. Council Member Gorton asked that Exhibit "B" in the November 21, 1989 minutes reflect whether the document was a staff analysis or a SWAC recommendation. Mayor Pro Tem Ayer noted a typographical error on page 26 of the November 7, 1989 minutes which should have read "privatization" instead of "private" Gorton motioned, Hopkins seconded to approve the minutes with the noted amendments. Motion carried with a 6-0-1 vote with Council Member Boyd abstaining as he was not present for one of the meetings. 2. The Council received comments from Roy Appleton, Jr., Bill Doig, and F'rank Martino of the Senior Management Council representing the Denton Chamber of Commerce regarding the Freeport Amendment. City of Denton City CounCil Minutes December 19, 1989 Page 4 Bill Doig, Senior Management Council of the Denton Chamber of Commerce and Plant Manager of Peterbilt, stated that the voters in Denton County showed overwhelming support (75%), for the Freeport Amendment. To uphold the Freeport Amendment meant a strong support of economic development in the community. The Chamber of Commerce and Peterbilt hoped that the City was farsighted enough to look into the long-term. In the-long-term the City, County and School District needed to develop the tax base. The way to do that was through economic growth, through economic development in the business community. The Freeport Amendment would not affect the 1990 budget for the City and School District. There was still a lot of time to plan ahead. He stated that Peterbilt was in favor of the Mayor's suggestion to form a task force to look at where the City, County and School District could go and plan for the future. For the long-term, the Freeport Amendment needed to be upheld. Council Member Boyd stated that he understood that if the CoUncil did not act to reinstate the taxes on the Freeport items, that the City would lose approximately $446,000 in tax revenue in 1990. Doig stated that he understood the City would not lose_ any revenue until 1991. He understood the City's budget for 1990 was based on 1989 revenue. All industry would continue to pay their 1989 taxes based oa the present tax base. Frank Martino, Chair-Senior Management Industrial Committee, stated that his business was within the City limits, his business chose City power over TP & L, and paid City taxes. He stated that within the City of Denton there had been three occurrences that the City did not have any control over which had benefited the City. The first major benefit was I35 east and west with the split in Denton. The City did not have any control over that but it made Denton a pivotal point of a tremendous growth area. The second benefit was the Dallas-Fort Worth Airport. It had a great effect on Denton. The third benefit was the Alliance Airport. He felt that air freight would be the next ma~or emphasis in the area. The Alliance Airport would draw more businesses for central distribution centers. Growth would come to the area but would it come to the City. A message would be sent to industries looking at the area if the City refused to grant the Freeport Amendment. Roy Appleton, Jr. stated that he was speaking as a representative of Denton Publishing Company, the Senior Management Council, and as Chairman of the Denton Economic Development Advisory Board. The issue was included in the recent State election as a means of helping rebuild and broadening the state's economy and subsequently its tax base. The fact that the voters wanted the economy improved and approved of this as one means of doing so was demonstrated by 313' 314 City of Denton City Council Minutes December 19, 1989 Page 5 the overwhelming majority who voted it throughout Tex~s, in the City of Denton and Denton County. The corridor along I35W from Fort Worth through north and northeast Tarrant County'to Denton showed every indication of being the next great growth area in the State. The acquisition of large tracts of land in Denton and Tarrant Counties by a few large players confirmed that potential. Fort Worth, Denton County and the Denton Independent School District had approved the Freeport tax exemption. The City of Dallas had approved the tax after 1990. A vote to deny or delay a decision would send a strong negative signal about the City of Denton to companies interested in Denton and to everyone in the economic development arena. The argument advanced by some that to allow the exemption in 1990-91 would not allow enough time to adjust budgetary matters was hard for the businessman to understand. The argument that time was needed to collect data and to determine what the exact impact would be was debatable. Because it was questionable whether truly accurate data could even be collected. Denton's economy needed improving and the Freeport exemption 'was one tool to help it improve. This was an investment in the future, not a gift to some special interest. He requested approval of the amendment. Council Member Boyd stated that if the amendment were approved for 1990, the effect would be to reduce the next budget year appropriations by approximately one-half million dollars or raise the tax rate two cents in order to make up for the lost money. It was troubling him that what was happening was that the tax burden was being shifted from the manufacturing industries to the homeowners. He asked Appleton if that was the appropriate thing to do. Appleton replied that Boyd may have left out one possibility. New business might come to Denton to broaden the tax base and make up the difference. Boyd's assumption was what the City had currently was what the City would have in the future. Appleton's position was that this was an investment. He felt that by following the will of the people, new and additional business would be brought to Denton that would increase revenues rather than restrict revenues. A lot of businesses in Denton would not be affected by the amendment. He was not proposing shifting the tax off of a few industries on to the property owner. He believed it would increase the tax base for all and would lighten the load for everybody. Council Member Boyd stated that the Council had to make decisions in current times. Appleton might be right that over a period of years that the money would be replaced by industry coming in. The question was when would it come in and would it~ come in in enough quantity to make up that significant amount of money. There was a small group of businesses which would get a very large impact from this amendment. Most of the rest of the businesses would not. He stated that in effect Appleton was asking the average citizen to subsidize this economic development. City of Denton City Council Minutes December 19, 1989 Page 6 Appleton replied that he was asking the Council to follow the wishes of the citizens as expressed at the polls to make this investment in the future. The voters chose to, make that investment by nearly a 70% vote. Council Member Alexander stated that he was not sure that the voters would remember and fully agree with the same principal next August when the Council would be talking about setting the tax rate for the following fiscal year. If approved, the Council would have to recognize that it would have some repercussions and probably a reduction in City services or an increase in the City tax rate. He wanted a pledge of cooperation from the Chamber to work with the City when those decisions needed to be made. Appleton replied that the Chamber would be happy to work with the City to explain the Freeport Amendment to citizens. Council Member McAdams felt that in talking to the average working person owning a house, not a single person had the same kind of zeal for the amendment when it was suggested that it either meant a reduction in service or an increase in taxes for them. Then they want to take another look at the amendment and wait a little bit. The Council did not want to be pushed into letting something go that they could not get back. The City had demonstrated a number of ways its commitment to economic development. The Council was not saying that the amendment was not a good idea. It was saying take another look at the amendment and make sure what it was doing. Mayor Stephens felt that the question was when and how to grant the exemption. January first was the deadline for 1990. April first was the deadline for subsequent years. The Council could waive the exemption as late as July when figures were obtained from the Central Appraisal District. Questions were raised on how to keep services the same with the reduction in money. 3. The Council received comments from Jesse Coffey regarding the Freeport Amendment. Mr. Coffey withdrew his request to address the Council. Public Hearings A. The Council held a public hearing and considered adoption of an ordinance providing for a change from Planned Development (PD-124) for Single Family Seven (SF-7) to Single Family Seven (SF-7). The site was approximately 7.1156 acres located on the north side of Silver Dome Road, south of Grant Parkway, and east of Greenfield Parkway. Z-89-017 (The Planning and zoning commission recommended approval.) 315 316 City of Denton City Council Minutes December 19, 1989 Page 7 The Mayor opened the public hearing. Bill Tinsley, Director-Denton Baptist Association, s%ated that this was a request for a change of zoning from Planned Development Single Family to Single Family for the development of a church. There were no anticipated problems with the roads around Hodge School during non-school hours. J. B. Strange, owner of property in the area, stated that he was in favor of the proposed development. He was involved in the original zoning of the property and had reviewed the plans for the property. He was in agreement with the proposed plans. Ken Cartwright, Business Manager-First Baptist Church of Denton, stated that the new church would be a mission church sponsored by the First Baptist Church. He felt the new church would be a part of economic growth in the community. NO one spoke in opposition. The Mayor closed the public hearing. Frank Robbins, Executive Director for Planning, showed slides of the area of the proposed zoning. The developer would have to build sidewalks and would have landscaping requirements. Staff felt that there were enough regulatory controls in place with the Landscape Ordinance and Subdivision Regulations to take care of any existing problems. The Planning and Zoning Commission recommended unanimously to approve the zoning case. The following ordinance was considered: NO. 89-184 AN ORDINANCE OF THE CITY OF DENTON, TEXAS, PROVIDING FOR A CHANGE FROM PLANNED DEVELOPMENT TO SINGLE FAMILY (SF-7) ZONING DISTRICT CLASSIFICATION AND USE DESIGNATION FOR 7.1156 ACRES OF LAND, LOCATED ON THE NORTH SIDE OF SILVER DOME ROAD, SOUTH OF GRANT PARKWAY~ AND EAST OF GREENFIELD PARKWAY~ AS IS MORE PARTICULARLY DESCRIBED HEREIN; PROVIDING FOR A PENALTY IN THE MAXIMUM AMOUNT OF $2~000.00 FOR VIOLATIONS THEREOF; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Hopkins seconded to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. City of Denton City Council Minutes December 19, 1989 Page 8 B. The Council held a public hearing and ¢.onsidered adoption of an ordinance providing for a change from Planned Development (PD-109) to Single Family Seven (SF-7) -for 22.914 acres of land located east of Audra Estates Subdivision, northeast of Mack Place Subdivision, and northwest of Bellaire Heights, approximately 1000 feet south of Audra Lane. Z-89-018 (The Planning and Zoning Commission recommended approval. The Mayor opened the public hearing. Bud Hauptman, Metroplex Engineering, presented overhead transparencies detailing the area and the street arrangements. Council Member Gorton left the meeting. Hauptman stated the proposed development would have better street arrangements and complied with SF-7 zoning. Council Member Boyd stated that one of the comments from an adjoining land owner was that access should be from Mockingbird. Was the property contiguous with Mockingbird. Council Member Gorton returned to the meeting. Hauptman replied that the property was separated from Mockingbird. Additional land would have to be purchased and the zoning changed in order to provide any type of access to Mockingbird. No one spoke in opposition. The Mayor closed the public hearing. Frank Robbins, Executive Director for Planning, stated that the only condition that was added to the Planned Development that would separate it from any other SF-7 zoning district at the time the planned development was granted was that sidewalks would be required on one side of the street. All other standards of SF-7 zoning at that time would apply. The Subdivision regulations had changed and now required sidewalks on both sides of the street. This proposal would improve the street alignment. Council Member Boyd stated that assuming no street/drainage connections were made, would the property function correctly for ingress, egress and drainage considerations. Robbins replied yes. 317 3.18 City of Denton City Council Minutes December 19, 1989 Page 9 The following ordinance was considered: NO. 89-185 AN ORDINANCE OF THE CITY OF DENTONv TEXASv PROVIDING FOR A CHANGE FROM PLANNED DEVELOPMENT TO SINGLE FAMILY (SF-7) ZONING DISTRICT CLASSIFICATION - AND USE DESIGNATION FOR 22.914 ACRES OF LAND LOCATED EAST OF AUDRA ESTATES SUBDIVISION, NORTHEAST OF MACK PLACE SUBDIVISION AND NORTHWEST OF BELLAIRE .HEIGHTS~ AS MORE PARTICULARLY DESCRIBED HEREIN; PROVIDING FOR A PENALTY IN THE MAXIMUM AMOUNT OF $2,000.00 FOR VIOLATIONS THEREOF; AND PROVIDING FOR AN EFFECTIVE DATE. Hopkins motioned, McAdams seconded to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. Se Consent Agenda McAdams motioned, Gorton seconded to approve the Consent Agenda as presented. Motion carried unanimously. A. Bids and Purchase Orders: 1. Bid #1046 -Secretarial Workstations 2. Bid #1047 - Wooden Transmission Poles 3. Bid #1041 - Computer Facility Air Conditioner 4. Bid #1043 - Demolition and Clearing #14 B. Tax Refunds Consider approval of a tax refund for Talenfeld Real Estate & Investment. 6. Ordinances A. The Council considered adoption of an ordinance accepting competitive bids and providing for the award of contracts for the purchase of materials, equipment, supplies or services. The following ordinance was considered: City of Denton City Council Minutes December 19, 1989 Page 10 31'9 NO. 89-186 AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND' AWARDING A CONTRACT FOR THE PURCHASE OF MATERIALS, EQUIPMENT, SUPPLIES OR SERVICES; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING FOR AN EFFECTIVE DATE. Gorton motioned, McAdams seconded to adopt the ordinance. On roll vote, 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 an ordinance accepting competitive bids and providing for the award of contracts for public works or improvements. The following ordinance was considered: NO. 89-187 AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND PROVIDING- FOR THE. AWARD OF CONTRACTS FOR PUBLIC WORKS OR IMPROVEMENTS; PROVIDING FOR THE EXPENDITURE OF ~FUNDS THEREFOR; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Alexander seconded to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye,' Hopkins 'aye," Gorton 'aye,' Ayer "aye," Boyd "aye," and Mayor Stephens 'aye." Motion carried unanimously. Item 7.A. was considered. 7. Resolutions A. The Council considered approval of a resolution granting approval to the North Texas Higher Education Authority, Inc. to issue student loan revenue bonds or otherwise borrow money, use the proceeds of said bonds or other evidences of borrowing and make certain findings in connection therewith. The following resolution was considered: NO. R89-077 A RESOLUTION GRANTING APPROVAL TO THE NORTH TEXAS HIGHER EDUCATION AUTHORITY, INC. TO ISSUE STUDENT LOAN REVENUE BONDS OR OTHERWISE BORROW MONEY~ USE THE PROCEEDS OF SAID BONDS OR OTHER EVIDENCES OF BORROWING AND MAKE CERTAIN FINDINGS IN CONNECTION THEREWITH. 320 City of Denton City Council Minutes December 19, 1989 Page 11 Ayer motioned, McAdams seconded to approve the resolution. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and May~r Stephens "aye." Motion carried unanimously. The Council returned to the regular agenda order. 6. Ordinances C. The Council considered adoption of an ordinance providing for the taxation of property exempt under Article VIII, Section l-j, Texas Constitution beginning with the 1990 tax year. Lloyd Harrell, City Manager, presented an update on new developments with regard to action taken by neighboring cities and the options available to the Council. Fort Worth indicated that they would not be taking any action either prior to January first or April first and would allow the Freeport Exemption to go into effect. Dallas would keep the taxation of the Freeport products for the next budget year (1990-91) and- then exempt those goods thereafter. Generally, the central cities in the area appeared to be moving immediately towards implementing the exemption while the suburban cities appeared to be retaining the tax at least for the present. The Metroplex Mayor's Association recommended to continue the tax until more information could be obtained. It also stated a need for a detailed cost benefit analysis performed by an outside agency. There were three options available to the Council. (1) Table the item and take no action. No action prior to January 1, 1990 meant that there would be no taxation of the goods for the next fiscal year and no action prior to April 1, 1990, no taxation for any future years. Once the decision was made, it was irreversible. There was no definite dollar amount determined at the present. The Denton Central Appraisal District was the only source, at this point, to be able to give any kind of rough estimate. They indicated that the implementation of the Freeport Amendment would mean the exclusion of 80% of the business personal property tax in the community. If that were correct, that would mean approximately $420,000 from next year's budget that would be lost if no action were taken and the amendment were allow to go into effect. If the item were tabled, if the amendment went into effect and if the loss were that amount of moneY, an approximate two cent increase in the tax rate or a substantial cut in City services would be necessary. (2) Pass the proposed ordinance which would continue the tax starting the next budget year and continuing in future years. Without any further Council action, the tax would be in place and the items would not ~ ~ump~. The decision would be reversible and the Council could take action to exempt the items. The advantages from that kind of action would be that because the decision was City of Denton City Council Minutes December 19, 1989 Page 12 321 reversible, the Council could wait up until the time the tax rolls were certified to implement the exemption for the next fiscal year. A decision could be made as late as September that the Freeport items could be exempt. At that point in time, the Council would know how much revenue would be lost. If the Council had the dollar figures, a more realistic debate could be held within the context of the budget as a major budget issue, whether to implement the exemption at' that point or not. Choices would then have to be made about increasing the general tax rate to make up the difference or cut services. (3) Amend the ordinance to implement the "Dallas option" which would continue to tax the goods for the 1990-91 fiscal year but exempt thereafter. Mayor Pro Tem Ayer asked that assuming the $420,000 figure was correct and assuming the Council did approve the exemption and did not raise taxes, would the City Manager give examples of how large a cut would have to be taken from the budget. City Manager Harrell replied that the cuts would have to be in programs and services. For example, the Police Department would have to eliminate the six new COPS positions, the three narcotics officers, and five dispatchers authorized in the current budget. Mayor Pro Tem Ayer stated that he was not suggesting that one large chunk be taken from one department but rather spread it among departments. This was a demonstration on the magnitude of what the dollar amount represented. City Manager Harrell continued that a $420,000 cut in the budget would represent about three-fourths of the City's total street patching and overlay program. It would wipe out all of the contributions made to other agencies which amounted to approximately $166,000 and still leave approximately $250,000 worth of cuts to find. It would close the Senior Center, Martin Luther King, Jr. Recreation Center and North Lakes Recreation and still be about $60,000 short. Mayor Pro Tem Ayer stated that there was no doubt that the Council was committed to economic development. He felt that many people who voted for the Freeport Amendment did not realize what they were doing in terms of their own taxes. There was a very positive campaign waged for the amendment and none of the negative aspects had been advertised. It was a good amendment. It provided cities and counties with still one more option for promoting economic development. The amendment did not enact a tax reduction, it simply provided cities with a local option to do so. The Legislature recognized that cities would need some time to adjust to the amendment because of the manner in which it was written and the spacing of the actions in order to implement it. The Council had the opportunity to keep options open. There was not much information about the impact on the amendment at this point. He felt it was prudent 3 City of Denton City Council Minutes December 19, 1989 Page 13 fiscal responsibility to keep options open. He :~.felt the Council needed to take their time on this item, to gather information, and study all of the facts. The Council had responsibility to the entire City and there were a lot of people in the City who might be affected adversely by the amendment. It did not make good fiscal sense to close options when to keep the options open would not damage anyone~ Council Member Gorton stated he felt there was a fourth option. If no action were taken before January 1, 1990 but taken before April 1, 1990, the goods could be taxed in 1991 and in all future years. City Manager Harrell replied that that was correct. If no action were taken at this meeting, the goods could not be taxed for the 1990-91 fiscal year. April first was the next deadline. If positive action were not taken by April 1, 1990 to continue the tax, then the goods could not be taxed from then on. Council Member Gorton stated that he was willing to yield to- the business community on the issue for this brief period of time. He challenged the business community to before April 1, 1990 com~ up with a plan of action to inform the citizens of the due effects of not allowing the tax to continue. He would yield to the wishes of the citizens as they voted in this brief period of time. He was willing to yield one year's worth of taxes for an educational process so the citizens could see the effect of exempting these areas of taxation and what the true impact would be on a local basis. Council Member Hopkins stated she wanted to start with the figures from the Appraisal District. She understood that they did not know because they never separated it. But no one had spoken to what might happen. The City might not necessarily get $420,000. If it were $420,000 this past year, it might not be that much next year. There had already been a cut in a shift at Peterbilt. NO one had said what would happen to Peterbilt, Tetrapack, and Andrew. If the economic downturn continued and did not improve, the City would not see $420,000. The City might not see $200,000. It could go the other way just as well as it could go up. Yet the City was saying to other companies not to come to Denton because the City was not willing to take the risk. When the Denton Independent School District and the County Commissioners respected the voters decision, she did not feel it was her place to override it. The voters were people who work at Peterbilt, Tetrapack, Andrew and Boeing and they understood about taxes. She did not feel it was going to be that big of a shock to them. The citizens knew what they voted for and it was obvious to most people who voted, that when a tax was excluded that was previously collected, that it was picked up by someone else. It was not a fair tax. If the Council voted City of Denton City Council Minutes December 19, 1989 Page 14 323 not to allow the exemption, the Council would be send.ing out a negative message. NOt only to companies looking to relocate but also to companies the City needed not to cut back or move away from here. The Council could not bind a future Council to the wishes of the present Council. She felt the Council should vote to exempt now but if not, a positive statement, should be made for the business community to say that the tax would be kept for 1990-91 year only and exclude later. This was more important t'han many other things being done and if some of those had to be taken out of the budget next year, then so be it. And if the taxes had to be raised two cents, the Council would be following what 70% of the voters said they would be willing to do. Council Member Alexander stated that there were two good arguments on each side. When the Council first put the item on the agenda, he felt the Council would be working with the DISD and the County Commissioners to study and review and keep options open for a while. Things had changed since then with the School Board granting the exemption. He was concerned about waiting and not making a decision. He was concerned that the benefit acquired from granting the exemption over the long-term would have to be a benefit that could be made evident now. He was inclined to suggest one of two options (1) table the issue and let the tax exemption go into effect or (2) keep the tax in place for 1990 and to make it clear that the tax would not be in place following that date. The considerations for economic development were out in the future. Companies looking at Denton were thinking about locating and building facilities here. Those facilities would be constructed and ready in time to enjoy the exemption. That would give the City a full year to make adjustments and to make plans to either reduce services or increase taxes. He felt that the strongest statement the Council could make would be to table the ordinance and allow the exemption to go into effect. Council Member McAdams stated that tax abatement or the Freeport Exemption was not be the only thing businesses looked at. At this moment, she did not see the best way to make up the dollars. She did not feel that sent a negative message to an industry looking at Denton. Businesses already in the City would be experiencing a break in the tax due to the actions by the DISD and the County. The Council could say that it had a commitment to this but was asking for time to get the budget in order. If a smaller amount of money was being talked about, she would not hesitate. But it involved perhaps a significant tax increase to people who already experienced an increase in City, County and School taxes while reducing taxes on others. She felt it would be a mistake to take it off this year but hold options for next year. She felt it was necessary to hold on to the option for'the future while studying the effects. 324 City of Denton City Council Minutes December 19, 1989 Page 15 Council Member Boyd felt it was ironic that the Council struggled every year to give a greater tax exemption to citizens over 65 but could give only $1,000 each year because the budget couldn't take too large hit all at once. NOW the Council would be asking for a considerably larger hit and also a possible increase in taxes. With the Freeport exemption, the tax structure in Denton may be more attractive to manufacturing industries, but it also may be less attractive to other industries. Other industries would not benefit from the exemption and would have to increase taxes. It might be that Denton would want to be a transportation hub or a manufacturing center. It might also be that Denton would want to be in banking or publishing or a number of other industries that would not benefit from the exemption. This amendment would mean restructure of the tax structure to benefit a narrow range of industries. Mayor Stephens felt that no one was in opposition to granting the exemption but that the question was how and when. He suggested that if the tax provision were continued, that the management could look at possible reductions of programs in- lieu of a tax increase to continue a suitable level of service. He felt that the exemption should be granted as soon as possible but not more than one to two years. This would send a signal that the City was in favor of phasing out the tax as quickly as possible without doing extreme level of damage to the City's level of service and without putting an extra tax burden on citizens and business/industry taxpayers. Council Member McAdams stated the City had coming on-line two additional fire stations which needed adequate staff and also had already promised the community another community center which would also need staff. The Senior Center was being expanded. The City had an obligation to have those physical facilities serve the public if the City was willing to spend money on them. .That meant additional dollars. The next year's budget did not just include the cost of the present year, it already included an increase. The Council needed to think about what it would say to the community if it could not provide the basic things that it had already promised them. The following ordinance was considered: NO. 89-188 AN ORDINANCE PROVIDING FOR THE TAXATION OF PROPERTY EXEMPT UNDER ARTICLE VIII, SECTION 1-jr TEXAS CONSTITUTION BEGINNING WITH THE 1990 TAX YEAR; AND DECLARING AN EFFECTIVE DATE. City of Denton City Council Minutes December 19, 1989 Page 16 Alexander motioned, Boyd seconded to amend the ordinance to implement the "Dallas plan" which would continue tO tax the goods for the 1990 budget but to announce that the Council would implement the exemption in the 1991 budget. Council then held a discussion regarding the wording for the amendment. A brief recess was taken in order to determine the exact legal wording necessary for the amendment. Following the recess, City Attorney Drayovitch suggested the amendment be written in a new Section II as follows: "That the Council hereby announces its intent that all of that property described in the Texas Constitution, Article VIII, Section 1-j shall be exempt from taxation beginning January 1, 1991". Council Member Alexander stated that he was satisfied with that wording for his motion of amendment. On roll vote, McAdams "aye," Alexander "aye," Gorton "nay," Ayer "aye," Boyd "aye," and "aye." Motion carried with a 6-1 vote. Hopkins "ayet" Mayor Stephens Boyd motioned, Alexander seconded to instruct staff to prepare an ordinance for the January 2, 1990 City Council agenda exempting the tax beginning January 1, 1991. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. D. The Council considered adoption of an ordinance designating and establishing speed zones on Loop 288 from Audra Lane to the 1-35E west frontage road; providing for a penalty of a fine not exceeding two hundred dollars and providing a severability clause. Rick Svehla, Deputy City Manager, stated that this was a request from the Highway Department to rezone the speed zones on Loop 288 from I35 to approximately US 380 based on radar studies done on the facility. The Citizens Traffic Safety Support Commission recommended approval. The following ordinance was considered: NO.89-189 AN ORDINANCE DESIGNATING AND ESTABLISHING SPEED ZONES ON LOOP 288 FROM AUDRA LANE TO THE 1-35E WEST FRONTAGE ROAD; PROVIDING FOR A PENALTY OF A FINE NOT EXCEEDING TWO HUNDRED DOLLARS ($200.00); PROVIDING A SEVERABILITY CLAUSE; AND DECLARING AN EFFECTIVE DATE. 325 326 City of Denton City Council Minutes December 19, 1989 Page 17 Ayer motioned, Boyd seconded to adopt the ordinance.~ On roll vote, McAdams "aye," Alexander "aye," Hopkins .aYe,. Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. E. The Council considered adoption of an ordinance amending Southview's Development Phasing Schedule3 (PD-132). (The Planning and Zoning Commission recommended approval). The following ordinance was considered: NO. 89-190 AN ORDINANCE OF THE CITY OF DENTON, TEXAS, AMENDING THE DEVELOPMENT SCHEDULE FOR PLANNED DEVELOPMENT DISTRICT NO. 132 (SOUTHVIEW); AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Hopkins seconded to adopt the ordinance. On roll vote, McAdams 'aye," Alexander "aye,' Hopkins "aye," Gorton "aye," Ayer 'aye," Boyd "aye,' and Mayor Stephens- 'aye.' Motion carried unanimously. F. The Council considered adoption of an ordinance awarding a contract for the purchase of gas from Lone Star Gas Company; and providing for the expenditure of funds therefore. (The Public Utilities Board recommended approval). Bob Nelson, Executive Director for Utilities, stated that the next four ordinances dealt with gas contracts with Lone Star Gas. The following ordinance was considered: NO. 89-191 AN ORDINANCE AWARDING A CONTRACT FOR THE PURCHASE OF GAS FROM LONE STAR GAS COMPANY; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Boyd seconded to adopt the ordinance. ~ On roll vote, McAdams "aye," Alexander "aye," Hopkins "ayet" Gorton "aye," Ayer "ayer" Boyd 'aye,' and Mayor Stephens "aye." Motion carried unanimously. G. The Council considered adoption of an ordinance awarding a contract for the transportation of gas to Lone Star Gas Company; and providing for the expenditure of funds therefore. (The Public Utilities Board recommended approval). City of Denton City Council Minutes December 19, 1989 Page 18 The following ordinance was considered: NO. 89-192 AN ORDINANCE AWARDING A CONTRACT FOR THE TRANSPORTATION OF GAS TO LONE STAR GAS COMPANY; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Gorton seconded to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. H. The Council considered adoption of an ordinance authorizing the Mayor to execute a contract with Lone Star Gas Company and the cities of Bryan, Greenville and Garland for the transfer of gas; and providing expenditure of funds. (The Public Utilities Board recommended approval). The following ordinance was considered: NO. 89-193 AN ORDINANCE AUTHORIZING THE MAYOR TO EXECUTE A CONTRACT WITH LONE STAR GAS COMPANY AND THE CITIES OF BRYANt GREENVILLE AND GARLAND FOR THE TRANSFER OF GAS; PROVIDING EXPENDITURE OF FUNDS; AND DECLARING AN EFFECTIVE DATE. McAdams motioned, Gorton seconded to adopt the' ordinance. On roll vote, McAdams "ayet" Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye,' Boyd "aye," and Mayor Stephens "aye.' Motion carried unanimously. I. The Council considered adoption of an ordinance awarding a contract for the purchase of spot gas from Enserch . Gas Company; and providing for the expenditure of funds therefore. (The Public Utilities Board recommended approval). The following ordinance was considered: NO. 89-194 AN ORDINANCE AWARDING A CONTRACT FOR THE PURCHASE OF SPOT GAS FROM ENSERCH GAS COMPANY; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING FOR AN EFFECTIVE DATE. 327 328 City of Denton City Council Minutes December 19, 1989 Page 19 McAdams motioned, Hopkins seconded to adopt the ordinance. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and May~r' Stephens "aye." Motion carried unanimously. J. The Council considered adoption of an. ordinance of the City of Denton, Texas, approving payment of the City of Denton's share of the annual administrative fee for participation in the Upper Trinity Regional Water District; and authorizing the expenditure of funds therefore.. The following ordinance was considered: NO. 89-195 AN ORDINANCE OF THE CITY OF DENTON, TEXAS, APPROVING PAYMENT OF THE CITY OF DENTON'S SHARE OF THE ANNUAL ADMINISTRATIVE FEE FOR PARTICIPATION IN THE UPPER TRINITY REGIONAL WATER DISTRICT; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Ayer seconded to adopt the ordinance. On roll vote, McAdams 'aye," Alexander 'aye," Hopkins ~aye,' Gorton 'aye,' Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. 7. Resolutions A. Item 7. A. was considered earlier in the meeting. B. The Council considered approval of a resolution whereby the City of Denton approves the 1989-90 fiscal year budget, in accordance with the provisions of Article 1432e V.A.T.S., as amended, of the Denton County Emergency Communications District. The following resolution was considered: NO. R89-078 A RESOLUTION WHEREBY THE CITY OF DENTON APPROVES THE 1989-90 FISCAL YEAR BUDGET, IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE 1432e V.A.T.$., AS AMENDED, OF THE DENTON COUNTY EMERGENCY COMMUNICATION DISTRICT; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Hopkins seconded to approve the resolution. On roll vote, McAdams "aye," Alexander 'aye,' Hopkins "aye," Gorton 'aye,' Aye~ "aye," Doyd "aye," and Mayor Stephens 'aye." Motion carried unanimously. City of Denton City Council Minutes December 19, 1989 Page 20 C. The Council considered approval of a resolution recognizing 1990 as the centennial year of the Uniyersity of North Texas. Mayor Stephens stated that the resolution came as a request from Chardean Newell and that part of the resolution had been omitted. Mayor Stephens requested that the following be included in the resolution in the next to last "Whereas": "and graduate degrees by 1988, and also has developed into one of five major research and teaching institutions of higher learning in the State of Texas, and is now the fourth largest in student enrollment". The following resolution was considered: NO. R89-079 A RESOLUTION RECOGNIZING 1990 AS THE CENTENNIAL YEAR OF THE UNIVERSITY OF NORTH TEXAS. Ayer motioned, Boyd seconded to approve the resolution with the- additional wording as noted. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye,"_ Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. D. The Council considered approval of a resolution requesting DART to secure the option on the Union Pacific right-of-way from Lewisville to Denton. Jesus Nava, Assistant to the City Manager, stated that this resolution would involve DART acquiring a long-term option for the railroad right-of-way from Lewisville to Denton. In order for DART to discuss the option 'with Union Pacific, DART requested a resolution from both the City Council and the Chamber of Commerce. The following resolution was considered: NO. 89-080 A RESOLUTION REQUESTING THAT THE DALLAS AREA RAPID TRANSIT AUTHORITY (DART) CONSIDER THE PROTECTION OF THE FORMER MKT RAIL LINE, CURRENTLY OWNED BY THE UNION PACIFIC RAILROAD, FROM ITS EXISTING SERVICE AREA IN CARROLLTON AND CONTINUING ON THROUGH TO THE CITY OF DENTON; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Boyd seconded to approve the resolution. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. 329 330' City of Denton City Council Minutes December 19, 1989 Page 21 8. The Council considered approval of a motion authorizing the City Manager to execute an agreement with the Texas Historical Commission for services in connection with the Urban Main Street Program. Jane Finley, Main Street Manager, reviewed the achievements of the Main Street Program during the past year. Hopkins motioned, Gorton seconded to approve the request. On roll vote, McAdams "aye," Alexander "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. Miscellaneous matters from the City Manager. City Manager Harrell had no items for Council. 10. There was no official action on Executive Session items from the Work Session. 11. New Business The following items of New Business were suggested by COuncil Members for future agendas: A. Mayor Pro Tem Ayer suggested the public be made aware of the report on privatization. 12. The Council did not meet in Executive Session during the Regular Session. With no further business, the meeting was adjourned at 10:00 p.m. N'I PEp WALTERS Y SECRETARY CITY OF DENTONt TEXAS 3222C