08-26-2014 MinutesMINUTES
REGULAR MEETING
August 26, 2014
A Regular Meeting was held by the Schertz City Council of the City of Schertz, Texas, on
August 26, 2014, at 6:00 p.m., in the Hal Baldwin Municipal Complex Council Chambers, 1400
Schertz Parkway, Building #4, Schertz, Texas. The following members present to -wit:
Mayor Michael Carpenter
Councilmember Jim Fowler
Councilmember Cedric Edwards
Staff Present:
Deputy City Manager John Bierschwale
Chief of Staff Bob Cantu
City Secretary Brenda Dennis
Call to Order
Mayor Pro -Tern Daryl John
Councilmember David Scagliola
Councilmember Matthew Duke
City Manager John Kessel
Executive Director Brian James
City Attorney Charles Zech
Deputy City Secretary Donna Schmoekel
Mayor Carpenter called the Regular Meeting to order at 6:00 p.m.
Invocation and Pledges of Allegiance to the Flags of the United States and the State of
Texas (Mayor Pro -Tem John)
Mayor Pro -Tem John provided the invocation followed by the Pledges of Allegiance to the Flags
of the United States and the State of Texas.
Presentations
• Employee Longevity Recognition —Michael Harris — 25 years (J. Kessel)
Mayor Carpenter recognized City Manager John Kessel who introduced Marshal Michael
(Mike) Harris and his wife Lori. Mr. Kessel stated they are here this evening to
recognize Marshal Harris for 25 years of service, as he started full time in May of 1989.
He stated Mike is currently the City's second City Marshal, we all know that the majority
of his career with the City has been in the police department. When Mike was attending
the Police Academy, the City of Cibolo sponsored him to go through the Academy. He
then worked as a Reserve Police Officer for Cibolo until former Police Chief Norman
Agee hired him to come to work in Schertz. The rest as they say is history. Mike
climbed the ladder of the Police Department through the years, starting as a Patrol
Officer, then Sergeant, then Lieutenant, then Assistant Chief of Police, then finally
Interim Chief of Police before taking on the position of Marshal. Mike told us his interest
in being in this field of work started when he took a law enforcement class in high school.
He went on to attend Southwest Texas Junior College and earned an Associate's Degree
in Criminal Justice before going on to get his bachelor's degree in Human Services from
Wayland Baptist University. Even though he had the path to law enforcement laid out in
08 -26 -2014 Minutes Page - t -
front of him, he did not immediately enter the Police Academy, as you may think he
would have. After getting his degree from Wayland Baptist, he worked for a furniture
company here in San Antonio. It was after that when he would take the job that would
change his career path back towards law enforcement — he worked for a window covering
company. During his tenure at the company, Mike describes the day that the IRS actually
came in and shut down the business. Mike was receiving unemployment and made the
decision to go to the Police Academy. And as mentioned before, the rest is history. Like
our other employees who have stood here and been honored before him, Mike has been
here to witness the growth and success of Schertz. He is from a military family (as many
of our employees/residents are) and was bom and raised in Germany for the first 15 years
of his life. In order to retire, his dad had to come to stateside, which is how he ended up
in this area. He mentioned when he started with Schertz PD, there were just 9 officers on
patrol (3 /shift). Hemet his wife, Lori, on the job. She actually worked for the-City first
and she and Mike were on the same shift for several years. They will be married 20 years
in October.
Mike is someone who is very active in our community. To say that he is involved in
several organizations would be an understatement from the local Lion's Club, to the
Shriner's, to the Guadalupe Valley Peace Officers, to the Texas Cave Management
Association — the list goes on and on. Upon meeting him, you know he is someone who
enjoys giving back to the community which he also took an oath to protect.
As he mentioned to us, the best piece of advice he has ever received has been this: "Don't
be afraid to make a mistake." While some — or most — may know that Mike is a bit of a
prankster, he is definitely down to business and serious when he talks about what his
vision is for his department and the legacy he wants to leave. He wants the Marshal's
Department, and Schertz, to keep moving forward and to continue to make a difference.
With Mike as our Marshal, we are confident in him and his team to do just this.
Deputy City Manager, John Bierschwale, has this to say about Mike: "Although Mike
loves to make people laugh and play a few practical jokes, he is extremely professional.
He is a kind employee and has compassion for his law enforcement duties. Mike treats
people fairly, understands the community's needs and serves with pride."
In closing, we would like to share one of the stories that Mike told us during our lunch.
When he was in Patrol, he was dispatched to a call that ended up becoming a standoff
situation. Long story short, Mike mentioned he was shot at, his patrol car took the hit and
the glass shattered into the vehicle. Mike is a fan of iced honey buns and had bought one
and had it in his vehicle this fateful evening. Well, when the glass shattered, the shards
impaled the package, turning it into something that resembled a bristly, porcupine -like
honey bun. Needless to say, after that incident, it was inedible and went to the trash.
After all these years, we feel like we owe it to Mike to make up for that honey bun he
never got to eat._ So, we have bought some and have it here for just this occasion — glass
free. Thank you for your service Marshal Harris! Mayor and Council congratulated
Marshal Harris and thanked him for his years of service.
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• Presentation and briefing regarding Bexar Waste weekly change for garbage pickup in
the South Schertz area. (J. Bierschwale /S. Willoughby /C. Spence/R. Rosales)
Mayor Carpenter recognized Business Office Assistant Manager Rodolfo Rosales who
introduced this item stating that Bexar Waste provides both twice a week and once a
week garbage and recycle pickup for the City of Schertz. One day a week pickup is
confined to Northcliffe and Southern Schertz on Wednesdays. Growth of these areas is
causing an extended after hours pickup in Southern Schertz. Bexar Waste is requesting to
move the Southern Schertz pickup to Friday.
City Events and Announcements
• Announcements of upcoming City Events (J. Bierschwale/B. James)
Mayor Carpenter recognized Executive Director of Development Brian James who
provided the following announcements:
• Wednesday, August 27, 2014 — Biz -Ed Breakfast — Schertz Chamber of
Commerce 7:30 a.m. — 9:00 a.m.
• Thursday, August 28, 2014 — H3 Mixer — hYPer Happy Hour, Mattenga's
Pizzeria, 6044 FM 3009 from 5:30 p.m. to 7:00 p.m.
• Friday, August 29, 2014 — Noon at the Schertz Senior Center — hYPer Group will
be presenting the Seniors with a check, it is also the Senior Center's Birthday
• Monday, September 1, 2014 — City Offices closed in observance of Labor Day
• Tuesday, September 2, 2014 — Ribbon Cutting — Suzie's Thrift and Gifts, 205
First Street, 10:00 a.m.
Mr. James stated that Former City Engineer Larry Dublin passed away Wednesday,
August 20, 2014. Funeral services will be held on Friday, August 29, 2014 at 9:30
a.m., at the Schertz Funeral Home.
Mayor Carpenter recognized Deputy City Manager John Bierschwale who came
forward stating that a big decision has been made in his life and career. Mr.
Bierschwale announced that he will be retiring June 30, 2015. He stated that he has
had an amazing journey with the City. He stated that Council has an amazing staff
and City Manager that stands up and does the right thing and we live by those values
every day of our lives. Mr. Bierschwale stated that on June 12, 2015, they will be
having a celebration and invited Council to be in attendance.
Mr. Bierschwale stated that he has had a great opportunity with the City. He stated
that at the age of 15 he became a volunteer fireman with the City. Mr. Bierschwale
showed a photograph that was taken with Rick Maas, Steve Woodward, Stewart
Rowell, Ed Rogers and himself that was taken in 1974. He stated that he has to give
special thanks to his Junior High and High School buddy, Steve Woodward, the late
08 -26 -2014 Minutes Page - 3 -
Chief Archie, late Chief Johnny Joe, Mr. Graham, a former Street Superintendent and
the Woodward Family. If it were not for the influence that these people had on his
life, he would not have the honor and privilege to be in front of you today. He stated
that he has put his love and life into this community and he loves his staff. He also
thanked the Mayor, Council, past Councilmembers and the late Hal Baldwin for
believing in him, giving him the opportunity to take a dream of a kid allowing him to
make a lifetime commitment to this community leaving a legacy and being a part of
the Schertz family. Thank you and god bless the citizens of the City of Schertz.
Mayor, Council and staff and those in the audience gave Mr. Bierschwale a standing
ovation.
Mayor Carpenter came down from the dais and announced that this marks 37 years
that Mr. Bierschwale has worked for the City. He stated there is no employee that has
more tenure, no one that has worked in more departments than Johnny Bierschwale.
Mayor Carpenter stated that not one of us expected the day would come, but we knew
it would come at some point that Johnny would make the decision. We all thought
Johnny would always be with the City. The good news is that he will always be here
because he is just down the street and he is with us for the next year. This means that
we have a year to convince him to stay, which he is going to try and do. Mr.
Bierschwale has had a remarkable and storied career, starting with the photograph
that was shown where he was a Volunteer Fireman.
Mayor Carpenter stated that they would call the kids out of class to go put out fires.
He stated that he wouldn't be comfortable doing that now, and Johnny was doing that
at 15 years of age. Mayor Carpenter stated that ever since he was elected and all the
Council will tell you that if they had a question about a call from a citizen or there
was any other question, Johnny could answer the question; he knew the whole story.
He could point to a spot on the ground and tell you there were pipes laid there.
Johnny has an indispensable amount of knowledge about the City of Schertz that is
going to be tough for us to overcome. No one has the amount of institutional
knowledge that Johnny has. Mayor Carpenter stated if you think about it, the one
constant that has been in the City of Schertz for the last 40 years, is Mr. Bierschwale.
• Announcements and recognitions by City Manager (J. Kessel)
No further announcements were provided.
Hearing of Residents:
Mayor Carpenter recognized the following who spoke:
• Mr. Bert Crawford, 4100 Brook Hollow, who came forward thanking the Citizens on
Patrol, Police, Fire and EMS Department for recently attending their HOA Back to
School Snow Cone Social.
Consent Agenda Items
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1. Minutes — Approve the minutes of the regular meeting of August 19, 2014. (J. Kessel/B.
Dennis)
2. Resolution No. 14 -R -72 — Consideration and/or action approving a Resolution amending
a Public Utility Easement Agreement with Joseph D. Hendrix for the use, benefit, and
control of the City of Schertz for the Town Creek Sewer line Extension Phase III Project
on FM 482. (J. Bierschwale /S. Willoughby /J. Hooks /C. Raleigh)
The following was read into record:
RESOLUTION NO. 14 -R -72
A RESOLUTION BY THE CITY COUNCIL OF THE CITY OF SCHERTZ,
TEXAS AMENDING A PUBLIC UTILITY EASEMENT AGREEMENT WITH
JOSEPH D. HENDRIX FOR THE USE, BENEFIT, AND CONTROL OF THE
CITY OF SCHERTZ FOR THE TOWN CREEK SEWERLINE EXTENSION
PHASE III PROJECT ON FM 482, AND OTHER MATTERS IN CONNECTION
THEREWITH
3. Resolution No. 14 -R -73 — Consideration and/or action approving a Resolution amending
the Sanitary Sewer Easement and Temporary Construction Easement Agreement with
Ector N. Crisler and Allene Crisler Revocable Living Trust for the use, benefit, and
control of the City of Schertz for the Town Creek Sewer line Extension Phase III Project
on FM 482. (J. Bierschwale /S. Willoughby /J. Hooks /C. Raleigh)
The following was read into record:
RESOLUTION NO. 14 -R -73
A RESOLUTION BY THE CITY COUNCIL OF THE CITY OF SCHERTZ,
TEXAS AMENDING THE SANITARY SEWER EASEMENT AND
TEMPORARY CONSTRUCTION EASEMENT AGREEMENT WITH ECTOR N.
CRISLER AND ALLENE CRISLER REVOCABLE LIVING TRUST FOR THE
USE, BENEFIT, AND CONTROL OF THE CITY OF SCHERTZ FOR THE
TOWN CREEK SEWERLINE EXTENSION PHASE IH PROJECT ON FM 482,
AND OTHER MATTERS IN CONNECTION THEREWITH
Mayor Carpenter recognized Councilmember Fowler who moved, seconded by
Councilmember Edwards to approve the consent agenda items 1, 2, and 3. The vote was
unanimous with Mayor Pro -Tem John, Councilmembers Fowler, Scagliola, Edwards,
and Duke voting yes and no one voting no. Motion Carried
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Executive Session
Mayor Carpenter recessed the regular meeting into executive session at 6:37 p.m.
9. City Council will meet in closed session under Texas Government Code Section 551.071,
consultation with the City Attorney, regarding. legal issues associated with the use of
budgeted funds.
Reconvene into Regular Session
Mayor Carpenter reconvened into regular session at 7:17 p.m.
9. a Take any necessary action based on discussions held in closed session under Agenda
Item number 9.
No action was taken.
Mayor Carpenter moved back to the discussion and action section of the agenda.
Discussion and Action Items
4. Resolution No. 14 -R -70 — Consideration and approval of a Resolution approving a Bond
Resolution to be adopted by the Board of Directors of the Cibolo Creek Municipal
Authority authorizing the issuance of Obligations designated as " Cibolo Creek Municipal
Authority Contract Revenue Bonds, Series 2014 (Southern Wastewater Treatment Plant
Project). Q. Bierschwale/M. McLiney /A. Friedman)
The following was read into record:
RESOLUTION NO. 14 -R -70
APPROVING A BOND RESOLUTION, TO BE ADOPTED BY THE BOARD OF
DIRECTORS OF THE CIBOLO CREEK MUNICIPAL AUTHORITY
AUTHORIZING THE ISSUANCE OF OBLIGATIONS DESIGNATED AS
" CIBOLO CREEK MUNICIPAL AUTHORITY CONTRACT REVENUE BONDS,
SERIES 2014 (SOUTHERN WASTEWATER TREATMENT PLANT
PROJECT)'; ACKNOWLEDGING THAT THESE OBLIGATIONS WILL BE
SOLD TO RAYMOND JAMES & ASSOCIATES, INC., DALLAS, TEXAS, AS
THE AUTHORIZED REPRESENTATIVE OF A GROUP OF UNDERWRITERS
PURSUANT TO THE PROVISIONS OF A PURCHASE CONTRACT;
APPROVING, RATIFYING, CONFIRMING, AND ADOPTING THE
PROVISIONS OF A REGIONAL WASTEWATER TREATMENT CONTRACT;
AUTHORIZING THE MAYOR, MAYOR PRO TEM, CITY MANAGER, AND
CITY SECRETARY OF THE CITY OF SCHERTZ, TEXAS TO EXECUTE ON
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BEHALF OF THE CITY OF SCHERTZ, TEXAS ALL DOCUMENTS IN
CONNECTION WITH THIS TRANSACTION;
Mayor Carpenter recognized Mark McLiney, Bond Council with Southwest Securities
who introduced this item stating that as the City has done in the past with respect to
bonds issued by the Schertz/Seguin Local Government Corporation, the City must adopt
a resolution approving the Cibolo Creek Municipal Authority bond resolution which will
be adopted by the Cibolo Creek Municipal Authority Board of Directors on September
11, 2014, to approve the Contract, and other matters related to the sale of the Cibolo
Creek Municipal Authority's Contract Revenue Bonds.
The City agrees to set rates and charges for its Utility System sufficient to cover its
annual payment pursuant to the Contract as well as the maintenance and operations
expenses at the Southern Plant. The Economist.com rate study included this project
within their rate model. City Council approved the Five Year Rate Schedule for Water
and Wastewater Rates based on the Economist.com rate study on July 30, 2013 by
Resolution 13 -R -60.
Any additional members that may tie into the Southern Plant in the future would pay for
their proportional shares of the debt service and operations of the Southern Plant,
reducing the City's payment obligation. (Please see the Southern Plant Wastewater
Services and Funding Agreement, also being considered on August 26, 2014, via
Resolution 14 -R -71 for a full description of the City of Cibolo's potential annual
payment responsibilities.) Staff recommends approval.
Mayor Carpenter recognized Councilmember Edwards who moved, seconded by
Councilmember Scagliola that the City Council adopt a Resolution approving a Bond
Resolution to be adopted by the Cibolo Creek Municipal Authority Board of Directors
authorizing the issuance of obligations designated as "Cibolo Creek Municipal Authority
Contract Revenue Bonds, Series 2014 (Southern Wastewater Treatment Plant Project) ".
The vote was unanimous with Mayor Pro -Tem John, Councilmembers Fowler,
Scagliola, Edwards, and Duke voting yes and no one voting no. Motion Carried.
5. Resolution No. 14 -R -71 — Consideration and approval of a Resolution by the City
Council of the City of Schertz, Texas authorizing a Southern Plant Wastewater Services
and Funding Agreement between the Cibolo Creek Municipal Authority, the City of
Cibolo, Texas, and the City of Schertz, Texas; and other matters in connection therewith.
(J. Bierschwale/M. McLiney /A. Friedman)
The following was read into record:
RESOLUTION NO. 14 -R -71
RESOLUTION BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS
AUTHORIZING A SOUTHERN PLANT WASTEWATER SERVICES AND
FUNDING AGREEMENT BETWEEN THE CIBOLO CREEK MUNICIPAL
08 -26 -2014 Minutes Page - 7 -
AUTHORITY, THE CITY OF CIBOLO, TEXAS, AND THE CITY OF SCHERTZ,
TEXAS; AND OTHER MATTERS IN CONNECTION THEREWITH
Mayor Carpenter recognized Mark McLiney, Bond Council with Southwest Securities who
introduced this item stating the City and CCMA understand that the next likely customer to
connect to the Southern Plant will be the City of Cibolo. The Southern Plant Wastewater
Services and Funding Agreement ( "Tri-Party Agreement") being considered will allow the
City of Cibolo to connect to the Southern Plant at any time and immediately pay a
proportional share of the operation and maintenance expenses. In addition, the Tri-Party
Agreement lays out terms for the City of Cibolo to begin making debt service payments.
Based upon a 30 year maturity schedule for the Bonds, Schertz will pay 100% of the debt
service for the first 10 years; Schertz and Cibolo will each pay 50% of the debt service for
years 11 -20; and Cibolo will pay 100% of the debt service for the years 21 -30. The City
has a right to sub - contract with other entities on a discretionary basis.
However, the Tri-Party Agreement expressly provides in Section 4(g) that Cibolo has up to
10 years (notice to be given by the 9th year) to secure all permits, licenses, certificates of
convenience and necessity, and other approvals that will be necessary for Cibolo to provide
wastewater services within the City of Cibolo to necessitate its need for the wastewater
capacity at the Southern Plant. As such, Cibolo has reserved the right, at its sole discretion,
not to participate in the Southern Plant.
The City agrees to set rates and charges for its Utility System sufficient to cover its
annual payment pursuant to the Contract as well as the maintenance and operations of the
Southern Plant. Initially, the City will be responsible for 100% of these payments. The
Economist.com rate study included this project within their rate model. City Council
approved the Five Year Rate Schedule for Water and Wastewater Rates based on the
Economist.com rate study on July 30, 2013 by Resolution 13 -R -60.
If and when Cibolo connects to the Southern Plant, Cibolo would begin to pay a
proportional share of maintenance and operation expenses of the Southern Plant, reducing
the City's obligations. Further as we get to years 11 -20, we could see our share of the
debt service drop in half and then end by year 21. However, should Cibolo not connect,
then the City of Schertz would be obligated to continue the debt service for the full term
of the bond. Should that occur, Schertz could sell the capacity to other agencies or utilize
it ourselves. Staff recommends Approval.
Mayor Carpenter recognized Councihnember Duke who moved, seconded by
Councilmember Scagliola that the City Council adopt a Resolution authorizing a
Southern Plant Wastewater Services and Funding Agreement. The vote was unanimous
with Mayor Pro -Tem John, Councilmembers Fowler, Scagliola, Edwards, and Duke
voting yes and no one voting no. Motion Carried.
6. Appointment of a City of Schertz Charter Review Commission — Discussion and
consideration and/or action on appointing a City of Schertz Charter Review Commission.
(Item requested by Mayor Carpenter) (Mayor /Council/J. Kessel/B. Dennis)
1
08 -26 -2014 Minutes Page - 8 -
Mayor Carpenter stated that the City Charter commands that from time to time Council
seat a charter review commission. We have had charter updates (2) the last time being
2006, so we are due to seat a commission. The charter is written by the people of the city
and it commands what the council and city manager can and must do. It also contains
prohibitions, such as in our case, the mayor shall not vote except in the case of a fie. The
charter defines how we operate as a city and occasionally residents take a look at the
charter for updates.
Mayor Carpenter recognized City Secretary Brenda Dennis who stated per the City
Charter Section 12.05, the City Council shall periodically appoint a Charter Review
Commission of five citizens of the City. The term of office of the Charter Review
Commission shall be 180 days after the date of appointment of the Commission, and, if
during this term no report is presented to the City Council, then all records of the
proceedings of the Commission shall be filed with the City Manager and the Charter
Review Commission shall be dismissed. (Election of 4 -7 -79, 5- 13 -06)
At the August 19, 2014 City Council meeting City Council discussed that the City has not
had a seated Charter Review Commission in eight (8) years since 2006. The Charter
directs Council to appoint a Charter Review Commission periodically, but it doesn't
define what "periodically" means. The Charter states that the Charter Review
Commission is made up of five (5) citizens. Since the Charter Review Commission sits
for six months, 180 days, and if the Council wishes to take the recommendations of that
citizen panel and put them before the voters next year then there is no longer time to seat
a 180 day commission for a May election date.
The Charter does not specify how the Council appoints commission members.
Historically, each voting member would nominate a member to the commission.
Alternately, the Council could solicit applications for the appointment of the five citizens.
It is recommended that Council seat a commission by December so the City can call an
election in July of 2015. Staff recommends council discuss the recommended options and
act if necessary.
Mayor Carpenter recognized City Manager John Kessel who complimented Ms. Dennis
on her work and said Council needs to 1) decide how to seat the commission, either by
application taking and review, or by appointment, and 2) consider going with staff
recommendation that we go with the November 2015 election period which will give us
enough time to go through the 180 day process and have time for staff and community
discussion. Staff thinks it will take the full 180 days to have a complete and thoughtful
dialogue. We will also save approximately $20,000 by not having an extra election in
May 2015.
Mayor Carpenter stated that he believed the last time the commission was assembled
each Councihnember recommended and appointed someone as a member. Former
Councilmember Greenwald, who was in the audience, confirmed this. He asked the
Councihnembers for their thoughts on how to proceed with seating the members.
08 -26 -2014 Minutes Page -9-
Mayor Carpenter recognized Councilmember Duke who stated he liked keeping tradition
but also adding in a layer of applications to review, which would be a good mix of the
process.
Mayor Carpenter recognized Councilmember Fowler who stated the 180 day requirement
may limit the number of people who might consider serving but he also liked the idea of
receiving voluntary applications to review.
Mayor Carpenter recognized Councilmember Scagliola who stated he liked the idea of
the election being held in November 2015 to save some election costs. However, he feels
the application process might slow things down. He stated he was prepared to nominate a
person right now.
Mayor Carpenter recognized Councilmember Edwards who stated he liked the
appointment process as well, but suggested any application review should be limited to
14 days.
Mayor Carpenter liked the idea of asking for applicants and also having the public come
forth as volunteers and then the Council could make an appointment from the general
public. He feels we should at least give it 30 days for applications to come in for review.
Ms. Dennis stated she had everything she needed to get this process started right away
7. Public Hearings on Proposed Budget for FY 2014 -15 — Conduct a public hearing and
consideration and/or action regarding the adoption of the FY 2014 -15 Budget (Second
required public hearings) (J. KesseUJ. Walters)
Ordinance No. 14 -T -42 - City of Schertz FY 2014 -15 Budget - Consideration and/or
action approving an Ordinance on the proposed FY 2014 -15 Budget. First Reading (J.
KesseUJ. Walters)
The following was read into record:
Cq:7171► /_O`[I`►[I�CElafq
AN ORDINANCE ADOPTING A BUDGET FOR THE FISCAL YEAR
BEGINNING OCTOBER 1, 2014, AND ENDING SEPTEMBER 30, 2015, IN
ACCORDANCE WITH THE CHARTER OF THE CITY OF SCHERTZ, TEXAS;
PROVIDING FOR THE FILING OF THE BUDGET; PROVIDING THAT THIS
ORDINANCE SHALL BE CUMULATIVE OF ALL ORDINANCES; PROVIDING
A SEVERABILITY CLAUSE; AND PROVIDING AN EFFECTIVE DATE.
Mayor Carpenter recognized Senior Budget/Analyst James Walters who stated this is the
second required public hearing and first reading of the budget ordinance. Council will
take the second and final vote to adopt the proposed City FY 2014 -15 budget at the next
08 -26 -2014 Minutes Page -10 -
regularly scheduled Council meeting on September 2, 2014 at 6:00 P.M. in the City
Council Chambers.
Mr. Walters provided a PowerPoint presentation with the following:
FY 2014 -15 Proposed Budget
Budget Goals:
• Balanced Structurally
• Conservative and Responsible
• Follows Financial Policies
• Maintains Current Service Levels
• Focuses on Priorities
Key City 5 Year Goals 2014
■ Building Repairs* - Rec. Center, Admin Building & Parking Lot, Fire State #2
■ Fire Station 3*
• Master Facilities Plan*
• Hold Tax Rate Flat*
■ Compensation Study*
• FM 1518 Funding Study*
• Maintain Reserves*
* Currently being worked on
Budget Highlights
• Addresses all Key 5 Year Goals
• Focus on our Fleet vehicles and operations
• Replaces aging equipment
• Long Term Debt Model
Change Memo
■ Crossing Guards
•Bring total Crossing Guards to 9
•Increase deployment time to 18 hours per week
*Paid by Restricted Crossing Guard Funds
■ Transportation Services
•New request higher than current year
Change Memo-
■ Hotel Tax
• The Sweetheart Program will be primarily funded by the General Fund
• Event Facilities will now be entirely funded by the General Fund
08 -26 -2014 Minutes Page - l l -
♦ If the Event Facilities become eligible to receive hotel tax funds in the
future, staff will seek direction from council through the budget process
Change Memo
■ Health Insurance
• 0% Increase through December 31, 2015
• The General Fund will use these savings to offset the Hotel Tax policy change
♦ Event Facilities
♦ Sweetheart Program
• Other Funds will put this savings toward the Compensation Study Action
Change Memo
■ EMS
rb
• Permanently Staff a 5 active ambulance during peak times
• Based on recommendation by Fitch & Associates, EMS has been running this
ambulance using PT workers and Overtime
• Using the most recent estimates there will be no change in funding request by
making this change
All Funds — Revenues
Mr. Walters stated that the general fund makes up 39% of the budget, Water & Sewer
fund makes up 27 %, EMS fund makes up 12 %, I &S fund makes up 9 %, and the rest goes
to the smaller funds.
General Fund
$25,695,043
Special Events Fund
153,800
PEG Fund
209,000
Water & Sewer Fund
17,860,678
EMS Fund
8,186,919
Drainage Fund
1,159,200
Hotel Tax
545,353
Park Fund
100,000
Tree Mitigation
116,335
Capital Recovery Water
885,500
Capital Recovery Sewer
1,160,497
I &S Fund
5,707,276
Other Funds
349,010
SEDC
3,692,257
GRAND TOTAL
$65,820,868
All Funds — Expenses
Mr. Walters stated that the general fund makes up 39% of the budget, Water & Sewer
fund makes up 28 %, EMS fund makes up 13 %, I &S fund makes up 9 %, and the other
funds make up the rest.
08 -26 -2014 Minutes Page - 12 -
General Fund
$25,406,088
Special Events Fund
153,800
PEG Fund
209,000
Water & Sewer Fund
17,788,563
EMS Fund
8,151,501
Drainage Fund
1,094,618
Hotel Tax
302,730
Park Fund
60,000
Tree Mitigation
116,125
Capital Recovery Water
536,109
Capital Recovery Sewer
1,160,497
I &S Fund
5,636,157
Other Funds
339,000
SEDC
3,074,554
GRAND TOTAL
$64,028,742
Tax Rate
Mr. Walters stated that the state has us calculate different property taxes and present them
to City Council and to the citizens. Following are the calculations:
Effective: The tax rate which, on average, will keep the tax bill the same as in 2013.
Current: The rate currently adopted by the City.
Proposed Max: The maximum rate set at which the final adopted rate cannot exceed,
and the rate we are requesting Council set tonight. This is also the rate
that we cannot exceed without issuing notices.
Rollback: The rate if exceeded allows citizens to initiate a rollback election. The
results of this election can reduce the adopted tax rate back to the
rollback rate.
Effective: $0.4857
Current: $0.4974
Proposed Max: $0.4974 - Proposed budget is balanced at this rate
Rollback: $0.5066
$0.01 is equal to $270,630 revenue or $17.42 on the average home
General Fund
Mr. Walters stated that using our revenue and expenses our increase in fund balance is
expected to be $353,866. Below is the breakdown:
08 -26 -2014 Minutes
Page - 13 -
Revenues
$25,695,043
Expenditures
25,460,088
Increase of Fund Balance
288,955
Beginning Fund Balance
5,936,141
Ending Fund Balance
6,225,096
25% Reserve Policy
$ 6,106,237
Mr. Walters stated that 25% reserve policy is for recurring operational expenses,
continues existing staffing levels and programs, but does not include vehicle replacement.
M &O $0.3164
Total Change in Expenditures
$ 203,000 New Employees
$ 54,015 Small Expanded Programs (10,000 or less)
$ 794,800 Large Expanded Programs (over 10,000)
$ 300,000 Act on Compensation Study
$ 770,000 Continued Existing Staffing Levels & Programs
$2,121,815 Total Increase
$ 353,500 Reserve Funding
M &O $0.3164
New Personnel
$ 26,000 2 Seasonal Park Workers
$ 45,000 Accountant
$ 93,000 2 additional mechanics
$ 39,000 Building Maintenance Worker I
$203,000 Total New Employees
M &O $0.3164
Small Expanded Programs
$ 1,500
Baby Changing Stations
$ 2,500
Lyric Implementation — add on to our new Office 365 program
$ 5,250
Portable AC Unit
$11,200
Fleet Equipment
$19,565
Laptops, Tablets, Printers, and Servers
$14,000
2 Defibrillators - Fire
$54,015
Total Small Expanded Programs
M &O $0.3164
Large Expanded Programs
$ 327,200 Vehicle Replacements
$ 36,000 Planning Tracking Software
$ 109,600 Replace 1/3 of Self Contained Breathing Apparatus
$ 30,000 Additional Landscaping Services
$ 21,000 Animal Adoption Trailer (City Portion - $10,000)
$ 50,000 New/Replacement Desks & Minor Renovations
08 -26 -2014 Minutes Page -14-
$ 150,000 Building Repairs — Admin. Bldg. and Parking lot, and Fire Station 2
$ 20,000 May Charter Election
$ 50,000 FM 1518 Funding Study (1-10 to FM 78)
$ 794,800 Total New Programs
Public Works Equipment
Equipment
Expense
3 Backhoes
$
195,000
Haul Truck & Trailer
$
125,000
Belly Dump Trailer
$
50,000
Chipper & Truck
$
99,200
Tractor w /Arm Mower
$
105,000
Zero Turn Mower
$
16,500
Front End Loader
$
209,000
Replacement Motor Grader
$
200,000
Street Sweeper
$
200,000
Total:
$1,199,700
25% Goal
M &O $0.3164
Reserve Funding
$ 169,000 Vehicle Replacement — able to replace more often
$ 24,500 A/C Replacement
$ 25,000 Server Replacement
$ 35,000 Phone System Replacement
$ 35,455 Unassimed Fund Balance —to be used on other projects necessary
$ 288,955 Total Reserve Funding
2013 — 5 Year Forecast Information
Mr. Walters provided the above information stating that this did not include action on the
employee salary survey, includes no personnel and very little capital purchases in the final four
(4) years. It does include the pool and firefighter ramp up in FY2016.
2014 — 5 Year Forecast Information
FY2013
FY2014
FY2015
FY2016
FY2017 FY2018
Revenue
$ 22 689,507
$ 23,170,010
$ 23,501,901
$ 24,092,029
$ 24,754 718 $ 25 440,833
Expense
$ 21,513,138
$22,618,597
$(22, 76,669
$ 24,009,901
S(24 '699,240) $ (25,547,867)
Reserve
Funding
$1,176,369
$551,413
$725,232
$82,128
$55,479
M &O Fund
Balance
$3,976,709
$4,528,123
$5,253,355
$5,335,484
$5,390,962
$5,283,928
25% Goal
$5,471,635
$5,637149
$5,694 167
$5 983 725
$6,174,810 $6,371,967
Over/Under
S(1-494,92
= $(7;109;02
$'440;812°
Mr. Walters provided the above information stating that this did not include action on the
employee salary survey, includes no personnel and very little capital purchases in the final four
(4) years. It does include the pool and firefighter ramp up in FY2016.
2014 — 5 Year Forecast Information
08 -26 -2014 Minutes Page -15 -
FY2013
FY2014
FY2015
FY2016
FY2017
I FY2018
Revenue
$ 24,611,808
$ 25,695,043
$ 26,675 735
$ 27,741 406
$ 28,861,862
$ 30,040-6
08 -26 -2014 Minutes Page -15 -
Expense
S(23,3 8,563
$ 25,460,088
S(26,482,051) 1 S(27,773,615) $ 28,825,511
$(29,656,219)
Reserve
$1,273,245
$288,955
$193,684 $36,351
$383,850
Funding
$0.3139
I &S
$0.1964
$0.1810
M &O Fund
$5,936,141
$6,225,096
$6,418,780 $6,386,570 $6,422,921
$6,806,772
Balance
25% Goal
$5,686,391
$6,106,237
$6,567,763 $6,9.09,404 $7,197,628
$7,414,055
Over/Under_.
=w <$ 607;283 •f
Mr. Walters stated that the 2014 — 5 Year Forecast includes $600,000 for salary survey over
3 years, firefighter ramp up, natatorium operations, and between 4 and 8 employees added
every year. He stated that the general fund would need to add closer to 12 to keep the same
ratio.
Long Term Debt Model
• For I &S Fund
• Purpose:
• To avoid large tax increases in the future
■ Design:
• Model is long term in nature
• Includes all current debt obligations
• Takes into account the growth of the tax base
• Ensures fund balance never falls below a certain level
• Includes bond elections every 5 years
Target Tax Rate
Tax Rate
Current
Recommended
Alternative
Maximum
M &O
$0.3010
$0.3164
$0.3139
I &S
$0.1964
$0.1810
$0.1810
Total
$0.4974
$0.4974
$0.4949
Mr. Walters stated that $0.5066 is the Rollback rate.
Budget Calendar FY 2014/15
July 31 File with City Secretary, Budget Workshop
August 5 Budget Workshop, vote to place a preliminary tax rate on the agenda, and
schedule public hearings
August 6 First Community Budget Presentation — Civic Center
August 12 Budget Workshop
August 14 Second Community Budget Presentation — Schertz United Methodist
Church
August 19 First Public Hearing
August 26 Second Public Hearing, First Vote
September 2 Second Vote and adoption of the budget and tax rate
October 1 Budget goes into effect
08 -26 -2014 Minutes Page -16 -
Mayor Carpenter opened the public hearing and recognized the following:
o Robert Brockman, 1000 Elbel Road, who stated that back a few years ago he
requested getting a new street sweeper. At that time the cost was $80,000, and now
he sees that the price is $200,000. Has the cost gone up that much? Also, on the
funding of the Senior Center, he understands we are going to fund it for three (3)
months, but wondered why we are not going to fund it for a whole year.
Mayor Carpenter closed the public hearing as no one else spoke.
Mayor Carpenter asked City Manager John Kessel to address Mr. Brockman's question
about the Senior Center. Mr. Kessel stated staff intends to go out for bids to see what that
cost number would look like. Then they will make a decision as to whether or not to
outsource the management of the Senior Center or leave it in -house and have Parks and
Recreation staff operate it. Since we don't know the cost of operation yet, they only
partially funded it and will make a final determination and come back to council. By
limiting the time it gives us a decision date to work with. Senior Budget/Finance Analyst
James Walters added that they had $50,000 set aside in the budget in case we switch to a
contract; so there is $50,000 to operate it ourselves plus another $50,000 if we switch to a
contract, for a total of $100,000. Mayor Carpenter stated we will operate the Senior Center
one way or another, whether we find an acceptable outsource entity or whether we operate
it ourselves.
Mayor Carpenter recognized Councilmember Fowler who asked Mr. Walters about his
statement earlier of taking out a loan for some ground maintenance equipment. Mr.
Walters stated that there is some equipment in Public works that is about 20 to 30 years old
and it would cost about $1.2 million to replace it. The Public works department does not
have this in their fund balance so while interest rates are still low, we can do this by a debt
issuance instead. Mr. Kessel added that it is favorable for us to take out a loan today rather
than in the future when rates will be much higher. The big picture item on this is that we
have deferred equipment replacement for years, and now staff has to spend a great deal of
time repairing it when it breaks down. By initiating this one -time expense, we can then
take a look at staffing levels to determine the appropriate amount of necessary operating
crews. Council member Fowler asked if we had put that money in the budget would it
have raised the taxes to our citizens by about five cents. Mr. Walters stated yes. So by
taking out a low interest rate loan for about seven years it will cost us around $30,000 over
the term. In regard to the .4949 alternative tax rate, if we went this route instead of the
.4974, it would cost us a building maintenance worker? Mr. Walters stated that if we went
with the .4949 rate, we would not be able to fund the proposed worker and his vehicle this
budget year. Mr. Kessel stated right now we are not getting to all the work orders as timely
as we would like. One of the hopes with this position would be to keep ahead of that curve
a bit.
Mayor Carpenter recognized Councilmember Scagliola who stated last year he looked at
the costs and revenues and he thought the budget last year was a little pessimistic. Despite
08 -26 -2014 Minutes Page - 17 -
the doom and gloom that was forecasted, revenues rebounded and we managed to achieve
our 25% reserve fund balance. He thinks this budget makes some unwarranted rather
negative assumptions. The claim that reducing the tax rate all hinges on the hiring of one
person is silly. We can't find in a 60 million dollar budget ways to trim $40,000? A
balanced budget should begin with an effective rate because it gets augmented by revenues
we have achieved through our economic development strategies. If increases are needed
above the effective rate plus the monies that augment that rate then they should be
presented and justified.
Mayor Carpenter recognized Councilmember Edwards who moved, seconded by
Councilmember Duke to approve first reading of Ordinance No. 14 -T -42, adopting the
budget for the fiscal year beginning October 1, 2014 and ending September 30, 2015.
The vote was 4 -I -0 with Mayor Pro -Tem John, Councilmembers Fowler, Edwards, and
Duke voting yes and Councilmember Scagliola voting no. Motion Carrier.
8. Public Hearings on Proposed Tax Rate — Conduct a public hearing and consideration
and/or action regarding the adoption of the FY 2014 -15 Tax Rate. (Second required public
hearings) (J. KesseUJ. Walters)
Ordinance No. 14 -T -43 — Tax Rate for Fiscal Year 2014 -15 - Consideration and/or
action approving an Ordinance on the proposed FY 2014 -15 Tax Rate. First Reading (J.
KesseUJ. Walters)
The following was read into record:
ORDINANCE NO. 14 -T -43
AN ORDINANCE APPROVING THE APPRAISAL ROLL; SETTING
THE TAX RATE; LEVYING AND ASSESSING GENERAL AND
SPECIAL AD VALOREM TAXES FOR THE USE AND SUPPORT OF
THE MUNICIPAL GOVERNMENT OF THE CITY OF SCHERTZ,
TEXAS; APPORTIONING THE LEVIES FOR SPECIFIC PURPOSES;
PROVIDING A SEVERABILITY CLAUSE; AND PROVIDING AN
EFFECTIVE DATE
Mayor Carpenter recognized Senior Budget/Finance Analyst James Walters who stated
that the proposed tax rate is at $0.4974, with $0.3164 for the M &O rate and $0.1810 for
the I &S rate.
Mayor Carpenter recognized Councilmember Fowler who stated he assumed we could
even make a recommendation for a different value for that 0.4949 tax rate. Mayor
Carpenter answered yes we can, but we cannot go above the maximum, but we could set
a rate below that.
08 -26 -2014 Minutes Page -18
Mayor Carpenter recognized City Manager John Kessel who stated that the one exception
is that the I &S rate would have to remain the same, as it is calculated to do our debt
service. The M &O rate would be the one you could play with as long as you keep the
total at or under the 0.4974.
Mayor Carpenter recognized Councilmember Fowler who asked why they couldn't go
with 0.4962 as the tax rate.
Mayor Carpenter recognized Councihnember Duke who stated in a lot of the latest
business books there is what is called the 20 mile march which is being consistent,
whether it is good or bad, it is going to be constant every year. His recommendation and
question to staff is, as opposed to playing with this number every single year, what is the
number that we say will be the number every single year on a consistent basis. For
instance, what would be the number for the next five years?
Mayor Carpenter recognized City Manager John Kessel who stated that is something we
have done with the I &S rate; that .1810 bounces for the next 30 years with the
assumptions we have made on our economic forecast. It lets us have a bond measure of
approximately 25 million every five years six times, for 30 years; so that portion is that
20 mile march. The M &O rate is more difficult, depending on what kind of city we want
to be in the next five and ten years. We can be a premier city, average, in- between, even
a poor city that does things badly. As we do bond measures we hire staff to work the
facilities or we have more population come in; how do we provide those services? If we
can beat the .1810 number because of economic development then we would reassign
that to the M &O rate. So the 20 mile march is really .4974. Staff's goal is to develop
economic processes and hold that 49 constant and if we could, then grow that M &O rate
to be able to provide additional services because we are able to lower the I &S rate and
still achieve that march.
Mayor Carpenter stated in the 1960's the city actually set a tax rate of $1 per $100 of
valuation. It was deliberate and temporary, but met a set of goals within a specific time
frame. More recently, in the last 10 years, we dropped the tax rate by about three cents
when we were in a growth mode. We didn't know a recession was looming, and we
pulled back too hard and raised taxes while depleting our reserves down to two weeks'
worth of reserve funds. We were too aggressive in scaling back the tax rate. He thinks
that on an annual basis, reducing the tax rate by a quarter cent is the correct projectory so
we keep the burden on the residents and businesses very close to the same, but not so
much that we have a sling shot effect nor raise the rate a quarter cent every year. It's
better to rely on our economic growth and sales taxes; those things can fund what we
need to do.
Mayor Carpenter recognized Councihnember Duke who stated he is looking for houses
now and he is looking at tax rates for the next ten years. His biggest concern is at what
time does it sling shot. We are in such a high growth phase now, while it would be great
to reduce the rate, if it were to sling shot in the next 3 -5 years, the risk of being off target
08 -26 -2014 Minutes Page - 19 -
is higher now. For the long term, we are going to need to be very cautious to have
consistency.
Mayor Carpenter recognized Councilmember Edwards who stated he looks at the
numbers. We are sitting on the cusp. If we had not passed that quality of life bond
initiative we could easily have become another Kirby. He was very concerned about that.
It was a strong growth phase. We need to continue moving forward. We can't keep up
now with the economic development we have now. We want a turnaround time on our
permits and on our customer service on both our executive customers and our residents.
Our economic growth must continue.
Mayor Carpenter opened the public hearing and recognized the following:
Mr. Robert Brockman, 1000 Elbel Road, who asked if Mr. Walters has a chart to display
showing the surrounding cities and the tax rates. He said he thinks we should raise the tax
rate by five cents. We are having too much of a gravy train now and if we raised the tax
rate by five cents it would help pay for our future fire station and firemen.
Ms. Maggie Titterington, 10217 Ivy Horn, who stated as a new resident of Schertz, she was
for the recommended maximum tax rate, and that at .4974 it was still staying the same, and
after going to all the budget meetings and listening to all the needs of the City and
understanding the M &O's and I &S's, she is all for this. We have a quality of life here we
want to preserve and she feels it is a good investment for our city's future growth needs.
She said the explanations at all the budget meetings were very thoroughly explained and
feels we will be experiencing a positive change.
As no one else spoke, Mayor Carpenter closed the public hearing.
Mayor Carpenter called for Council comments and recognized Councilmember Scagliola
who wanted to point out that holding the rate where it is this tax rate spends 1.2 million
dollars more than it did last year and also spends an additional million dollars and gives
nothing back to the residents.
Mayor Carpenter recognized Councilmember Duke who responded that he doesn't know if
that number is right or not but we are in a high growth phase and there are going to be more
expenses that we have to spend today in order to keep up with the progress or we will get
behind. As a huge growing community those costs are coming whether we want them or
not and we either keep up with it to sustain our quality of life or we will get very, very far
behind and unable to catch up.
Mayor Carpenter recognized Councilmember Edwards who stated he felt the residents
would still be getting something back with the new fire station and fire protection service.
Mayor Carpenter stated he felt if we passed the alternative rate of .4949 or the
recommended maximum of .4974, either way it will be a responsible tax rate. Although he
doesn't have a vote, he probably would advocate for the .4949.
08 -26 -2014 Minutes Page - 20 -
Mayor Carpenter recognized Councilmember Edwards who stated that in order to be
responsible we don't want to pass this burden down to the next Council or even 10 years
from now. He thinks the recommended maximum is where we need to be. No further
comments from Council.
Mayor Carpenter recognized Councilmember Edwards who moved, seconded by
Councilmember Duke that property taxes be increased by the adoption of a tax rate of
$0.4974, which is effectively a 2.4% increase in the tax rate. The vote was 4 -I -0 with
Mayor Pro -Tem John, Councilmembers Fowler, Edwards, and Duke voting yes and
Councilmember Scagliola voting no. Motion Carried
Roll Call Vote Confirmation
Mayor Carpenter recognized Deputy City Secretary Donna Schmoekel who recapped the votes
of items 1 through 8.
Executive Session
Mayor Carpenter recessed the regular meeting into executive session at 8:31 p.m.
10. City Council will meet in closed session under section 551.087 Texas Government Code,
Deliberation regarding Economic Development Negotiations with business prospects E-
003, E -004, E -006, E -007, and E -008.
11. City Council will meet in closed session under Texas Government Code Section 551.074
personnel issues and 551.071 consultation with attorney to discuss and deliberate the
employment term of the City Manager.
Reconvene into Reeular Session
Mayor Carpenter reconvened into regular session at 9:33 p.m.
10.a Take any necessary action based on discussions held inclosed session under Agenda Item
number 10. .
No action was taken.
11. a Take any necessary action based on discussions held in closed session under Agenda Item
number 11.
Mayor Carpenter recognized Councilmember Fowler who moved, seconded by
Councilmember Duke that Council extend the City Manager's contract for one year. The
vote was unanimous with Mayor Pro -Tem John, Councilmembers Fowler, Scagliola,
Edwards, and Duke voting yes and no one voting no. Motion Carried
08 -26 -2014 Minutes Page - 21-
Roll Call Vote Confirmation
Mayor Carpenter recognized Deputy City Secretary Donna Schmoekel who recapped the vote on
agenda item 11A.
Requests and Announcements
12. Announcements by City Manager
• Citizen Kudos
• Recognition of City employee actions
• New Departmental initiatives
No further announcements were provided. However, City Secretary Brenda Dennis
stated she wanted to wish a Happy Birthday to the following individuals this month:
Mayor Pro -Tern John, Councilmember Edwards, Councilmember Scagliola, and Chief of
Staff Bob Cantu.
13. Requests by Mayor and Councihnembers that items be placed on a future City Council
agenda.
Mayor Carpenter recognized Councilmember Duke who requested an update on the
natatorium to find out where we were on this project. The item will be scheduled for
discussion on the City Council Agenda for September 16, 2014.
14. Announcements by Mayor and Councilmembers
• City and community events attended and to be attended
• City Council Committee and Liaison Assignments (see assignments below)
• Continuing education events attended and to be attended
• Recognition of actions by City employees
• Recognition of actions by community volunteers
• Upcoming City Council agenda items
Mayor Carpenter recognized Councilmember Fowler who stated he attended the
following:
• The Parks and Recreation Advisory Committee meeting held last evening.
• The 100'' Birthday Celebration of city resident Ms. Bertha Moore.
Mayor Carpenter recognized Councilmember Scagliola who stated he attended the
following:
• Thursday, August 21, SSLGC meeting in Seguin at their new facility.
08 -26 -2014 Minutes Page - 22 -
Mayor Carpenter recognized Councihnember Edwards who stated he received numerous
texts while in Executive Session this evening regarding his son who has tonight accepted
to attend West Point, following in the footsteps of his older brother. Mayor Carpenter
stated he could not think of two finer young men who will end up being commissioned
officers in our military.
Adiournment
As there was no further business, the meeting was adjourned at
R. Carpenter, Mayor
08 -26 -2014 Minutes Page - 23 -