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Minutes September 29, 199225 CITY OF DENTON CITY COUNCIL MINUTES SEPTEMBER 29, 1992 The Council convened into the Special Call Session at 5:15 p.m. in the Civil Defense Room. PRESENT: Mayor Castleberry; Mayor Pro Tem Hopkins; Council Members Brock, Chew, Perry, Smith and Miller. ABSENT: None 1. The Council considered adoption of an ordinance establishing a program to promote local economic development and to stimulate business in the City, and approving an economic development grant agreement with ~PACCAR, Inc. Lloyd Harrell, City Manager, stated that the item was listed as an action item, however, the attorneys for the City and for PACCAR had not completed the formal agreement. It was hoped that the agreement would come back to Council at the next meeting and if not, for sure at the following meeting. Betty McKean, Executive Director for Economic Development/Municipal Services, stated that Peterbilt Motors Company, a division of PACCAR, was the City's largest manufacturer since its location in Denton in 1980. One of the issues which brought PACCAR to Denton was a corporate goal to get its engineers closer to one of its manufacturing sites. A consulting firm indicated to her office that a prospect was looking for an existing building for office purposes. They indicated an interest in the Moore Business Forms building and with that staff began examining incentives to determine how Denton could be best positioned so as to be selected as the new site. The Moore Business Forms building was not located in an Enterprise Zone and the Freeport Exemption was not applicable. The City's formal tax abatement policy was not applicable due to the fact that the project involved an existing building rather than new construction. Other alternative incentives, outside the City's established policies and programs, were explored. The proposal presented to PACCAR included the following: (1) PACCAR would purchase the Moore Business Forms building. Should the assessed value of the land and building exceed $1,545,650 during the first five years after that date of purchase, the City would make economic development grant payments equal to the amount of City and Denton Independent School District property taxes paid by PACCAR for building and land valuations exceeding $1,545,650. This grant agreement was permissible under Section 380.001 of the Local Government Code. The State law did not afford school districts the same grant capabilities and therefore, the City would be responsible for the DISD's grant payment portion. The County Commissioner's Court would consider an identioal agreement for the County~ portion of increased valuation. (2) Application of the Electric Utility Economic/ Industrial Development Rider at the Moore Business Form facility City of Denton City Council Minutes September '29, 1992 Page 2 would provide an estimated savings of over $54,000 over a five year period. McKean reviewed a chart indicating the impact of $1 million increase in valuation with the PACCAR grant agreement which was included in the agenda back-up. An overhead was shown indicating the jobs which would be created and the sales tax revenue generated by the Peterbilt relocation. Dick Bangert, Director of Real Property Resources for PACCAR, stated that PACCAR was here because the Moore Building met their needs. If it had not been available, PACCAR might not have made the decision to relocate at this time. Incentives were also very important. In the long run, the City and the County would receive more than PACCAR did with the move. It made a difference to them what the cities and counties would provide as an incentive. Council Member Perry asked if there were any additional reasons why PACCAR decided to locate in Denton. Bangert replied that ever since PACCAR made the first decision to come to Denton it had wanted to move the engineering section to an area closer to a manufacturing site. Denton was the newest plant in the Peterbilt area. The main reason was to get the engineering staff closer to the plant. The market was another reason to move to Denton as it was more concentrated in this part of the country rather than in other areas. 2. The Council convened into Executive Session to discuss legal matters (considered intervention in Dallas County Park Cities Municipal Utility District v. City of Dallas and City of Grapevine), real estate, and personnel/board appointments (considered appointments to the Downtown Advisory Board, the Electrical Code Board, and the Animal Shelter Advisory Board). 3. The Council considered an appointment to the Community Justice Council. Miller motioned, Chew seconded to nominate Council Member Perry to the Community Justice Council. Consensus of the Council was to appoint Council Member Perry. 4. The Council received a report and held a discussion on the electric rate study and the proposed electric rates and gave staff direction. Bob Nelson, Executive Director for Utilities, stated that there was a proposed 5.1% reduction in electric rates. City of Denton City Council Minutes September 29, 1992 Page 3 Suhas Patwardam, C. H. Guernsey, stated that his task was to look at the rates and forecast revenues, make a cost of service analysis and make a recommendation on the type of rate design. He had worked very closely with the Utility staff during the process. Patwardam reviewed the implementation of the rate strategy which included defining the system revenue requirement, defining class revenue requirements, defining customer revenue requirements, coordination of the rate design and line extension policy and monitoring and analyzing the system performance. Conclusions from the study indicated that the utility was fulfilling its mission with reliable service, competitive prices and money transfers to the City. The proposed rates should be adopted and would meet financial objectives, provide competitive ~process and promote wise/efficient/cost-based usage of electricity. The proposed rates would generate approximately 5% less revenue and would be adequate to operate the system in a reliable fashion. Conclusions from the Cost of Service study indicated that there were performance or rate classes which were dissimilar. Large customers in the GS class were performing much better than small customers. Patwardam reviewed the proposed changes in the various rate categories. No customer rates would go up and most would go down. Some classes would go down more than others. Compared with other area utilities, the rates were very competitive in the summer months and the winter months. Patwardam reviewed the rate for churches - religious worship rate. No one was currently on this rate as the churches were served on the GS rate and generally had a favorable load profile with substantial off-peak usage and heavy weekend usage. The load profile resulted in a lower cost of service. Many communities and utilities offered incentive rates to churches. This rate could be offered due to the pattern of usage and the way the electricity was used. Two options for church rates included continuing the existing policy which would leave them on the GS rate or trying an experimental off-peak rate in which the users would need to demonstrate a lower peak demand requirement during weekdays and on-peak weekhours which would provide a 20% discount on demand charge. Nelson stated the customers in question for the experimental rate had a higher demand on the weekend than during the weekday. If that level was set at 80% so that during the week the usage was 80% less than on the weekend, a 20% decrease from the demand charge would be provided. The Public Utilities Board recommended a 60% level of what a commercial customer was paying. The Board recommended a 60% level with an 80% cut-off level. __ Council Member Smith a~ked if the time frame was a year for the experimental service. 28 City of Denton City Council Minutes September 29, 1992 Page 4 Nelson replied that the experimental service would be analyzed year to year to determine the effectiveness of the rate. Council Member Chew felt it was better to do an 80% level and follow the consultants recommendation and after a year perhaps go down to the 60% level. Nelson replied that the revenue would be somewhat less and if the City were to get challenged on the level, it would have to revert back to the 80% level. Jim Harder, Director of Electric Utilities, stated that if the category were dealing with churches and other businesses in that category, there would be an incentive to change their loads to positively benefit the electric utility and changing their current off-peak period. The proposed rate would be an experimental weekend rate. Mayor Pro Tem Hopkins felt that the recommendation of the consultant should be followed. She was concerned about legal issues. If the category would fit any other type of business other than churches, she wanted to know who else it would fit. She asked what would prevent a business from artificially altering their load by using excess load on a Saturday in order to qualify for the reduced rate. Nelson replied that that was a risk with the experimental rate. There was the opportunity for a convenience type store to artificially put a load on their system and qualify for reduced rate. Mayor Pro Tem Hopkins felt that if the level were reduced from what the consultant advised, a year analysis would be too long and felt that the analysis period should be no longer than 6 months. Nelson replied that at any point during year if it were found that the customers on the program were not providing the load management program, the Council could terminate the experimental rate. Council Member Chew indicated that h~ had a concern ~ha~ ~hi~ type of rate had been done before and the structure had to be redone due to the legality of the proposal. Nelson replied that both proposals were based on a usage pattern and not the type of customer. If a customer asked to be on the rate, the customer data would be analyzed before he was put on the rate. If there was no current data, the customer would put on a meter and the data analyzed after three months. If the customer City of Denton City Council Minutes September 29, 1992 Page 5 qualified for the rate, he then could be put on that rate. If the customer broke the 80% rule, he would have to wait 12 months before he could be put back on. The rate was strictly characteristic of usage and not type of customer. City Manager Harrell stated that from a staff stand point, if the level were set at 60%, then there would be more risk that someone would artificially manipulate the rates to qualify. Harder then presented a comparison of the experimental weekend rates with the current rate, the consultant rate and the proposed weekend rate. Council Member Miller felt that it would be best to be conservative. It would be easier to go further in the future rather that do a larger decrease now and then next year have an increase. Mayor Castleberry asked if there were a difference between the winter and summer months in the analysis. Harder stated that the tendency would be for a violation of the 80% rule in the summer rather than the winter. Council Member Chew felt that it was best to take smaller steps than do it all at once. Council Member smith felt that 80% was a more conservative and reasonable figure to start with. An entire year should be studied at the 80% figure. Perry motioned, Smith seconded to follow the recommendation of the consultants. On roll vote, Brock "aye", Miller "aye", Hopkins "aye", Smith "aye", Chew "aye", Perry "aye", and Mayor Castleberry "aye". Motion carried unanimously. 5. The Council received a report and held a discussion on the water rate study and proposed water rates and gave staff direction. Bob Nelson, Executive Director for Utilities, stated that during the budget process, revenues at the current rates were approximately $12.1 million and expenses were approximately $12.8 million. A proposed '5.9% increase in water rates would cover anticipated expenses and provide a cash net gain of approximately $35,000. Howard Martin, Director of Environmental Operation=/Pinancial Administration, stated that the Public Utilities Board had asked staff to look at the possibility of adding 2,000 gallons to the 30 City of Denton City Council Minutes September 29, 1992 Page 6 facility charge. After further review, the Board opted to keep the structure as it was as it would raise the facility charge too much. Two new rates were proposed in the water ordinance. One was an Adopt-A Spot rate and the other was a government sprinkler irrigation rate which would lower the cost per 1000 gallons on the basis of providing either non-interruptible or interruptible service. Martin detailed on an overhead the development of the revenue targets. $683,430 was needed ~o cover anticipated expenses over revenues with an overall 5.9% Increase proposed. Several options were presented for allocating the residential rate increase to the three block rate structure for the Utilities Board to consider. The Board elected to select the option that allocated the rate increase to the first block rate which was 0-15,000 gallons. Martin detailed the residential utilities average customer increase which would be approximately $1.76 per month. The commercial rate would be increased approximately $26.50 per month for an average usage customer. In comparison with area cities, Denton was in the middle of the area charges. Chew motioned, Smith seconded to follow staff recommendation for the water rates. On roll vote, Brock "aye", Miller "aye", Hopkins "aye", Smith "aye", Chew "aye", Perry "aye", and Mayor Castleberry "aye". Motion carried unanimously. 6. The Council received a report and held a discussion on the wastewater rate study and proposed wastewater rates and gave staff direction. Howard Martin, Director of Environmental Operations/Financial Administration, stated that the Public Utilities Board first discussed the change in wholesale rate methodology that resulted in a rate decrease for those customers. The Board asked staff to present a residential rate option that included 2,000 gallons in the basic rate. After reviewing the proposed option, the Board elected to retain the existing rate structure. The Board recommended an overall increase of 14%. The rate increase for most customers was at least 15% but the overall rate increase included a wholesale wastewater rate decrease. An average residential customer would have an increase of $2.14 per month on his wa~t~wate~ bill. A large residential u~er would have approximately a $3.00 increase on his wastewater bill. A commercial customer would have an increase of $58.65 per month. Again Denton was in the middle of the rate structure for surrounding cities. An average utility customer would realize a $2.42 increase for all utilities. Commercial total utilities would have a decrease of $2,520.94 per month due to a decrease in electric rate. 31 city of Denton City Council Minutes September 29, 1992 Page 7 Perry motioned, Hopkins seconded to follow the recommendation of staff regarding the wastewater rates. On roll vote, Brock "aye", Miller "aye", Hopkins "aye", smith "aye", Chew "aye", Perry "aye", and Mayor Castleberry "aye". Motion carried unanimously. 7. The Council received a report and held a discussion on the solid waste rate study and proposed solid waste rates and gave staff direction. Bill Angelo stated that the proposed ordinance provided for a $0.35 rate increase for residential customers. The State of Texas surcharge for solid waste received at the landfill was being passed on to both residential and commercial customers in the form of a 3.5% charge which would be shown as a separate item on the bill. He presented Council a handout which detailed the rates at the landfill and the areas of increase. There would be two new fees established. It was proposed that the basic disposal fees at the landfill would remain the same as last year. One new rate would differentiate between automobile and truck tires. Another fee would be a charge for "special waste" disposed at the landfill. The proposed rate was consistent with the charges at the DFW landfill and reflected the cost of special handling and administration expenses associated with this type of waste. Hopkins motioned, Smith seconded to follow the recommendation of the Public Utilities Board for the rates on solid waste. On roll vote, Brock "aye", Miller "aye", Hopkins "aye", Smith "aye", Chew "aye", Perry "aye", and Mayor Castleberry "aye". Motion carried unanimously. Brock motioned, Smith seconded to approve the increases on tires and special wastes. On roll vote, Brock "aye", Miller "aye", Hopkins "aye", Smith "aye", Chew "aye", Perry "aye", and Mayor Castleberry "aye". Motion carried unanimously. 8. The Council received a report and held a discussion regarding solicitations on the roadway and gave staff direction. Catherine Tuck, Administrative Assistant, stated that in 1988 the Council had received an increased number of complaints about persons and organizations attempting to solicit business or charitable contributions from the occupants of vehicles at intersections. Groups and individuals were soliciting on numerous busy intersections all over the City, causing traffic problems and endangering the individual~ collecting the fund~. The Council expressed concern with the safety for those out soliciting and for motorists. In March 1988, the Council passed an ordinance which 32 City of Denton City Council Minutes September 29, 1992 Page 8 prohibited solicitation on any street or roadway or be on or go upon the shoulder or median of any street or roadway for the purpose of soliciting business or charitable contributions of any kind from the occupant of any vehicle. At the September 1, 1992 Council meeting, Alan Hempstead, representing the City's fire fighters, requested an exemption to the ordinance on behalf of the Muscular Dystrophy Association. The fire fighters had requested permission to solicit for the "Fill-the-Boot" campaign. Mr. Hempstead had mentioned two Oklahoma cities which made special provision for the annual Fill-the-Boot campaign despite local ordinances which prohibited solicitation on roadways. Tulsa's traffic ordinance did not permitted solicitation from the roadway but their solicitation ordinance appeared to allow it. Tulsa permitted only sworn public safety officers to solicit in roadways for charitable projects adopted by their bargaining agents. The Legal Department indicated that the ordinance should be consistent. Either allow all to solicit on the roadways or allow no one to solicit on the roadways. Area metroplex cities which allow the solicitation on roadways had a permit process which included various requirements. Debra Drayovitch, City Attorney, stated that any time there was an attempt to regulate the First Amendment rights, there was a good case for litigation. It was very difficult to legally make a fool- proof type ordinance which was not subject to some type of litigation. Council Member Brock asked about the Tulsa law which allowed only sworn public safety officers to solicit from roadways. Would this hold up to a court challenge. Drayovitch replied that the Oklahoma law was very different and it could have been part of a collective bargaining agreement. Tuck stated that the Council could repeal the current ordinance and follow the State law or could enact an ordinance similar to another city with strict guidelines. Mayor Pro Tem 'Hopkins stated that before the current Council repealed th~ ordinance, members migh% want to speak to former Council Members regarding reasons for the initial ordinance. They had been concerned about pedestrian safety and vehicular traffic. She suggested that if the ordinance were repealed, the Council did not want to be the entity to grant permission for solicitation from the roadway. She felt that everyone should be allowed to solicit from the streets or no one should be allowed. There were many safety issues to deal with when there were individuals on the roadway. She was particularly concerned with the youth on 33 city of Denton City Council Minutes September 29, 1992 Page 9 University Drive and how dangerous it was. Council Member Perry asked how fully the current ordinance was being enforced. Was anyone allowed to solicit on the roadways. City Manager Harrell replied from the permitting standpoint, the enforcement was consistent and soliciting from the roadway was not allowed. Some groups had started to solicit on the roadway and had been asked to leave. There were times when the police department did not give a high level of enforcement to this event especially on events such as car washes on University Drive. If Council did not repeal ordinance, staff would do more enforcement of the provisions to not solicit on the medians and would even visit the high schools to talk with groups regarding the provisions of the ordinance. Council Member Chew suggested talking with university students as well as high school groups. City Attorney Drayovitch stated that a procedure could be developed which would not include the Council's granting of permission to solicit in the roadway. The State statute allowed a local governing body to authorize solicitation of charitable contributions. Her opinion with respect to free speech and First Amendment rights would be, if the Council desired, that pursuant to the State statute the Council authorize solicitation of charitable contributions. Mayor Castleberry asked what was the City liability in this matter such as someone stepping off a curb and into an oncoming car. City Attorney Drayovitch replied that if the City were sued, it would argue against the City's liability but that could be challenged. Council Member Perry asked if there had ever been a fatality or injury in the City due to solicitation from the roadway. A1 Hempstead replied that there had been none documented in the 40 years the fire fighter organizations had been working for MDA. Council Member Perry replied that he was referring to everyone who had solicited on the roadways and not just the fire fighters. Council Member Smith asked Hempstead if he had investigated other possibili%ies £o~ ~oliei~&tln~ ~ont~ibu~ion~ ~ath~r than on th~ streets. 34 City of Denton City Council Minutes September 29, 1992 Page 10 Hempstead replied that they had looked at other methods but that there was no other way to receive the same dollar amount as on the streets. Previously the fire fighters had raised more money on the streets than in a shopping center. Council Member Miller stated that the fire fighters would use good judgement when going out in the streets but others might not. If a fire fighter came to a car, the occupant might be more inclined to donate but might not be so with others. Julie Shook, Denton MDA, stated that Oklahoma City and Tulsa raised a lot of money for the event in a weekend. There was not another type of event which would raise the same amount of money in a weekend. Joe Dodd asked if the requiring of insurance and the filing of a waiver would eliminate the problems. City Attorney Drayovitch replied that there were certain problems with the enforceability of waivers. With the invalidation of an ordinance there might be attorney's fees for the other side to consider. Bill Burger, MDA, stated that the $1 million insurance policy would cover any attorneys fees. MDA was willing to work with the City in regards to a waiver of liability, limiting the solicitation to certain streets, limiting hours and days. Nothing had ever been documented for accidents or injuries associated with the MDA program. Council Member Miller asked if it would be possible to direct staff to draft an ordinance detailing who would be able to solicit from city streets. Council Member Perry asked who would chose who would be able to solicit. He was not saying that the fire fighters could not solicit in Denton, he was asking them to use a different approach. He was hesitantto exclude some and allow others to solicit on the roadways. Council Member Miller suggested drafting something similar to the Lewisville ordinance. He was interested in how many requests Lewisville had in a year. Restrictions could be made to a point so as to encourage only those who really wanted to do the event. He suggested a further refinement of the ordinance and look at it in comparison with other cities. 35 City of Denton City Council Minutes September 29, 1992 Page 11 Council Member Smith stated that the bottom line was that the Council needed to decide if it wanted to have any organizations on the streets. Deciding who or what would come next. Council Member Chew was concerned about the fact that the ordinance was not enforced totally. He agreed that perhaps it would be beneficial to look at other cities ordinances such as Lewisville. Council Member Miller motioned, Chew seconded to direct staff to study other city ordinances such as Lewisville and Grand Prairie to determine how their ordinance worked and their experiences. On roll vote, Brock "aye", Miller "aye", Hopkins "nay", Smith "nay", Chew "aye", Perry "nay", and Mayor Castleberry "aye". Motion failed with a 3-4 vote. 9. The Council received a report and held a discussion on the City's position regarding the Fry Street Fair and gave staff direction. Catherine Tuck, Administrative Assistant, reviewed the history of the Fry Street Fair over the past several years as detailed in the agenda back-up. Council Member Miller suggested forming a task force now to look at the possibility of holding the Fair on Fry Street. He suggested starting the process now to make arrangements for the Fair. Lloyd Harrell, City Manager, stated that a policy question the Council would have to consider was that if the conditions could be negotiated with the Delta Lodge, would it be acceptable to have this event on Fry Street. If so, he could see using staff time trying to negotiate those conditions. Until that question was answered, there was no reason for staff to start those negotiations. Mayor Pro Tem Hopkins stated that she saw no reason to permit the Fair. This group was not even recognized by the University and was not allowed to .use University property or to close a street that North Texas maintained. There were too many people for the area during the Fair and there was no way to get in or out of the area. The area was an area of concern for the police department. If the University did not recognize this group she did not know why the Council should give them any credibility. One year the Fair was held at Carriage Square Shopping Center and they can not return to that area. The Fair did not work out at the Fairgrounds. She was opposed to spendin~ any amount of staff time to work out Fry Street as it was too small for the number of people who attended the event and it could not be adequately policed. City of Denton City Council Minutes September 29, 1992 Page 12 Mayor Castleberry stated that the Council needed to think about a possible request from the Delta Lodge for the closing of Avenue A between Mulberry and West Hickory. Council Member Miller stated that there had been a Fry Street Fair in 1990, 1991 and 1992. What was the Council going to do in 1993. Mayor Pro Tem Hopkins stated that she would say no to a Fair request. Council Member Miller replied then where was the Fair going to be. He was asking if it were possible to set up a task force to see what might be done for 1993 to prevent the problems which occurred in 1990, 1991 and 1992. He did not think the issue would not come up and he was looking for a way to help plan for the event and to help reduce any problems. City Manager Harrell stated that if the Council were inclined to not close Fry Street and to not waive the noise ordinance and that were communicated to the Delta Lodge, it might encourage them to look for a place in the country or something similar to hold the event. Council Member Smith stated that her experience with the Fry Street Fair had been limited but she did make several trips to the Fair grounds last year and felt that it was not the type of activity that she believed should go on within the City limits. The crowd which was there this last year would never fit on Fry Street or Mulberry Street. Many of the people who attended the event were not from this area. She would like to see the event outside the City limits perhaps on a farm or other such area. It had outgrown the City. Mayor Pro Tem Hopkins felt that the Fair had outgrown the confines of a street fair. Council Member Perry stated that he would say no to the Fry Street Fair for reasons already mentioned. He had observed many hours of the previous Fair and did not feel it would be in the best interest of the City to promote that type of activity. He would vote against holding the Fair anywhere in the City. It was not the kind of event that the council could say was in the best interest of the City. Council Member Miller felt that the Council's sentiments needed to be communicated to the Delta Lodge. The Lodge need not apply or if they applied, the Council would not authorize a Fry Street Fair or a similar event by any other name in the City limits this next 37 City of Denton City Council Minutes September 29, 1992 Page 13 year. Now was the time to make that communication rather than wait until a request had been made. Council Member Chew felt that it needed to be communicated immediately to the Delta Lodge that the feeling of the Council was that this was not the type of activity which would promote the City of Denton. Joe Dodd stated that he used to be an advocate of the Fry Street Fair but was not now. The Fair used to be a type of homecoming to area residents but it now had outgrown its identity. Fry Street Fair away from Fry Street was a beer bust. If the Fair could not be held on Fry Street and the number of people be contained in the area, then he saw no reason to hold the event. Brock motioned, Chew seconded that Council direct the City staff to communicate with Delta Lodge that the Council was very unfavorable toward their having the Fry Street Fair, as it had developed in recent years, within the City limits of Denton and that the Council most probably would not look favorably on a request to close Fry Street. On roll vote, Brock "aye", Miller "aye", Hopkins "aye", Smith "aye", Chew "aye", Perry "aye", and Mayor Castleberry "aye". Motion carried unanimously. 10. The Council received a briefing regarding the new security system at City Hall. Lloyd Harrell, City Manager, stated that as of Monday there was a new alarm system in operation at City Hall. He discussed the details of the new system with the Council. With no further business, J~'FE%WALTERS cA%Y SEgfT Y CITY OF DENTON, TEXAS the Council adjourned at 9:25 p.m. BOB CASTLEBERRY, MA~OR~ CITY OF DENTON, TEXAS / ACC000BA