2022 04 28 WS Minutes MINUTES OF THE REGULAR WORK SESSION OF THE
CITY COUNCIL OF THE CITY OF BAYTOWN
April 28, 2022
The City Council of the City of Baytown, Texas, met in a Regular Work Session on Thursday,
April 28, 2022, at 5:31 P.M. in the Hullum Conference Room of the Baytown City Hall, 2401
Market Street, Baytown, Texas with the following in attendance:
Laura Alvarado Council Member
Chris Presley Mayor Pro Tern
Charles Johnson Council Member
Heather Betancourth Council Member
Jacob Powell Council Member
Mike Lester Council Member
Brandon Capetillo Mayor
Rick Davis City Manager
Trevor Fanning Interim City Attorney
Angela Jackson City Clerk
Mayor Capetillo convened the April 28, 2022, City Council Regular Work Session with a quorum
present at 5:31 P.M., all members were present.
1. DISCUSSIONS
a. Receive and discuss the general provisions of the Open Meetings Act and Council's
Rules of Procedure.
Interim City Attorney Trevor Fanning presented a refresher over the Open Meetings Act and
Council's Rules of Procedure to Council via a PowerPoint presentation. Mr. Fanning commenced
noting the Open Meeting Act stated Council would have to be given notice of the time and place
of the meeting. The general rule was that it would have to be open to the public which would apply
anytime there was a quorum—even though no action had been taken. Mr. Fanning relayed there
were exceptions, such as: social functions, convention workshops, ceremonial events, press
conferences, candidate forums, and debates to inform the electorate. If formal action was not taken
nor any discussion of public business,Mr. Fanning stated it would be okay. Gatherings of a quorum
were not subject to the Act when Council was in attendance at a meeting of a committee or agency
of the legislature in the interest of Baytown.
He noted there was a 72-hour rule for how long an open meeting must be posted, which is why
city staff tried to post agendas on Fridays. Exceptions to the notice requirements were that Council
could recess to the next business day and also in the event of emergencies. Emergency Meetings
required Council to receive a special notice prior to the meeting, which contain the date, hour,
place, and a detailed description of each item to be discussed at the meeting. Mr. Fanning briefly
touched on specific wordings for those agenda items.
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In the event an unposted issue was raised at an open meeting, Council Members may respond with
a statement of specific factual information or recite the existing policy on that issue. Mr. Fanning
added Council could directly speak to staff and offer to place the item on the agenda for discussion
in the future. Council could receive a report at a meeting regarding a topic that was not on the
agenda if the following applied: the reports were given by staff or a Council Member; the report
was about an item of community interest; no action was taken; or possible action was not
discussed. Mr. Fanning further defined what an item of community interest was.
Executive Sessions were permitted when Council deliberated on a gift, personnel matters (if that
city employee did not request the public), deliberate the purchase of property, and consult with an
attorney. There were several other provisions, but Mr. Fanning stated those were the ones that
applied to the City Council. Council had a code of ethics where they could find statutory and local
standards.
Mayor Capetillo gave the example of when Council received documents regarding real estate and
asked if those documents or the discussion be confidential. Mr. Fanning responded that there were
too many rules to give a rule of thumb. He further relayed a few scenarios where there were a wide
variety of laws that protected the information, and also the instance were the privilege was waived.
In regards to confidential documents, Mayor Capetillo asked if staff could identify the material
that is considered confidential.
There was further discussion regarding what would be considered confidential in executive
sessions. Mayor Capetillo recommended the best rule of thumb would be if a subject matter
qualified for Executive Session, it would be in the best interest of all Council to maintain the
integrity of whatever took place. Mayor Pro Tem Presley disagreed with that rule of thumb and
recited the Texas Attorney General's opinion, JM-1071 Subsection 2A(h)Article 6252-17. Mayor
Pro Tem Presley believed public access to the proceedings were invaluable and any attempt to
discourage or minimized public access would be a travesty.
Council Member Johnson shared that he understood what was discussed in executive sessions,
stayed in executive session, and asked if that was not the case. Mr. Fanning responded there was
not a blanket rule and it depended on the information. Council Member Johnson additionally
inquired if something did not say it was confidential, could it then be discussed in public, and Mr.
Fanning stated the rule was if it did not say it was confidential. Council Member Johnson then
wondered how would Council know if the discussion was confidential rather than something that
would be on paper and Mr. Fanning replied there were a lot of different laws that could be at play,
and again, it depended on the information. For example, discussing a personnel matter could get a
Council Member sued for libel. In further explanation of what could be said outside executive
session, Mr. Fanning commented the Attorney General opinion said the city could not make a law
against that, but the city could make an ethical ruling. Mayor Pro Tem Presley clarified the law
would supersede any rule the city may make and Mr. Fanning confirmed so, if it was law.
Council Member Alvarado agreed with Mayor Capetillo's recommendation to leave it up to Legal
or staff to know what could or could not be discussed. Mr. Fanning offered he could make a
presentation at a later date to outline all the different things that could come into play. Council
Member Johnson added the suggestion that before beginning executive sessions, Council be
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April 28,2022
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informed by staff if the information should not be discussed for whatever reason. There was further
deliberation before Mr. Fanning continued with his presentation.
Mr. Fanning continued to list other local standards. He noted that the penalties of the Ethics
Ordinance were civil in nature, especially with local standards. Council could receive a letter of
notification,admonition,or removal/suspension from office.Mr. Fanning noted Baytown's Ethical
Ordinance required Council to have a training on it within 30 days upon assuming their position.
The City Attorney, in consultation with the Ethics Commission, developed the educational
material.
Then, Mr. Fanning opened the floor to questions. Mayor Pro Tem Presley suggested that when a
topic was of special community interest, Council could be more detailed in their description of
agenda items for executive sessions. He believed that would be good practice and would provide
more transparency as well. Mayor Pro Tern Presley added the certified agenda stated the time that
the executive session was convened, the time adjourned, and that no action was taken. Mayor Pro
Tern Presley recommended Council consider audio recordings of the executive sessions that could
only be obtainable by court order. He believed that would be under the lock and key of the City
Clerk's Office where nobody—not even the City Attorney, City Manager, nor the City Clerk—
would have the right to listen to such audio recordings. City Clerk Angela Jackson confirmed that
would be correct. Mr. Fanning concurred some cities did record executive sessions that were
protected by state law as the recording, itself, would be confidential.
Council Member Johnson wondered if the recordings would be confidential, then why would
everything said in executive sessions not be confidential. They could then hold people accountable
for speaking on what was said in those sessions. Mayor Pro Tem Presley noted that question had
been answered by the Supreme Court. Mr. Fanning added the statue did say certain things would
have to be released by state law, for example: if there was evidence of a crime that came up in
executive session. Mr. Fanning presumed that was why there was no sweeping law that said,
"anything said in executive session,would have to stay in the executive session."Council Member
Johnson relayed he was trained that anything said in executive sessions was off-limits and multiple
former Council Members and Mayors have reminded him of that. In that moment, Council
Member Johnson expressed he felt as if he was not given accurate information. He believed
executive sessions were held at a certain standard, and those that attended executive sessions were
held at a higher standard. However, he was now finding out there was no standard to begin with,
at least, that was what it sounded like to him.
Council Member Alvarado did not feel as though something was extracted because,as Mr. Fanning
mentioned, it was just a rule of thumb. Also, she did not feel like they were trying to keep
something from the public. For example, in buying property, Council would want to keep it under
wraps because prices could go up. Council Member Alvarado felt that Council respected the
information that was shared in good faith and it was not to keep something from the public. Council
would just receive new information, get somewhat of a clarity, and then learn what would need to
be done.
Council Member Lester agreed there were issues that could and could not be talked about. If a
council member wanted to talk about something that was discussed in an executive session and
then it was determined the Council Member talked about something that was confidential, the
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liability was on that individual. He believed taking a higher standard rule for themselves to not
talk about anything would protect themselves. As Mayor Pro Tern Presley pointed out, if it would
be something Council Member Lester clearly knew would not be confidential and was of public
interest, he could talk about it. There were a lot of laws that touched on different gray areas as Mr.
Fanning noted. If a Council Member were to make a mistake, the liability was on that Council
Member. Mayor Pro Tern Presley commented he was willing to take that risk. In Council Member
Lester's thirty-plus years of working in their municipality, the rule of thumb was that nobody
talked about executive sessions, even though Council Members knew some things were allowable.
He stated Council would have to be cautious and that would be on each Council Member as
individuals.
Council Member Johnson reiterated his wish to know going into an executive session if certain
information could be discussed and it should not be a gray area, but rather it should be in black
and white, so that way if someone were to ask a question, Council Members could say they could
not discuss that. Of course, Council could not discuss attorney-client privilege nor any current
litigation information. Mayor Pro Tern Presley added he believed recently Council had too many
executive sessions. He understood the mall deal was complicated along with other projects;
however, he preferred to discuss anything and everything that Council possibly could in an open
session. Mayor Capetillo expanded on that note that Council could only discuss certain items for
executive session and since there were only four or five qualifiers, their Legal Department would
know if such items did not qualify.
b. Discuss any or all of the agenda items on the City Council Regular Meeting Agenda
for April 28, 2022, which is attached below.
Mr. Michael Johnson, on behalf of Friendswood Development Company, wished to discuss
Agenda Item 6.a. on the City Council Regular Meeting agenda, which considered his company's
request for annexation of the 378.34 acres into Harris County Municipal Utility District("MUD")
No. 213-A. Before the vote, Mr. Johnson wanted to revisit a clip from his presentation over four
years ago. At that time, Friendswood Development Company and the City of Baytown agreed to
establish a public-private relationship through the creation of an Extraterritorial Jurisdiction
("ETJ")MUD.The ETJ MUD afforded Friendswood Development Company to provide economic
development opportunities, transportation improvements, regional utility and drainage
improvements, and the chance to fulfil the vision that Baytown had outline in its 2025
Comprehension Plan.
Friendswood Development Company and the City of Baytown had set out to create an identifiable
community with quality housing options for thousands of commuters that were then working in
Baytown, but not living in Baytown. Mr. Johnson shared photos in the handout that he provided
of their first two of four planned neighborhoods. Mr. Johnson relayed those images were proof
that Friendswood Development Company's and the City of Baytown's collective vision from four
years ago had come to life in a big way. At that time, Baytown Crossing was the number one
selling community in all of East Houston. Council's vote in support and consent would reflect a
continued commitment to a large-scale cohesive planning and development that would transform
the once 900 acres of underutilized sod farms in to a community for 2,700 new families.
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April 28,2022
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Warranting the investment of$175 million in private investment in land development that would
create the following as relayed by Mr. Johnson:
• 12 Miles of Concrete Hike and Bike Trails
• Over 150 Acers of Lakes
• 2 Recreation Centers with Pools
• 9 Playgrounds
• Over 100 Square Feet of Recreations Space Per Home
• State-of-the-Art Onsite Pumphrey Elementary
o Also, a Possible Second Onsite Elementary in their Expansion Tract
Mr. Johnson stated there would be a cohesive presence along major thoroughfares with:
• A Consistent Masonry Fence
• Soft Scape Improvements
• Trail Improvements on Over 26,000 Linear Feet of Street Frontage
• Over 2 Miles of New Collector Streets (Privately Financed)
• 1 Mile of Major Thoroughfare Boulevard Improvements on Garth Road and North Maine
• A Variety of Quality Home Offerings
o A Minimum of 3 Sides of Masonry on the First Floor and Expanded Landscape
Requirements
By that summer, Friendswood Development Company would have four active programs in
Baytown Crossings ranging from $220,000 to $450,000. Leading up to the night, Friendswood
Development Company had met multiple times with staff to listen to concerns and proposed
solutions at Council's February work session. Those solutions had been embedded in the proposed
amendments to their agreements pertaining to Harris County MUD No. 213-A. However, Mr.
Johnson noted at the work session and during follow-up conversations, a few more concerns had
been raised that Mr. Johnson wished to briefly close the loop on that night.
Friendswood Development Company heard the concern about the proximity to homes to industrial
uses on Haney Road in their expansion track. Thus,Friendswood Development Company adjusted
their initial land plan to expand their detention footprint on the east side of their project to move
those homes further west. There were also concerns from the City about MUDs never going away.
Therefore, Friendswood Development Company embedded in their Strategic Partnership
Agreement (SPA) with City authority to a Full Purpose Annexation at the expiration of the initial
term. Mr. Johnson additionally offered that Friendswood Development Company would agree to
not sell new bonds without the City's consent after December 31, 2035.
Finally, Friendswood Development Company heard that their company wanted the Mont Belvieu
product. Mr. Johnson clarified that Lennar, Friendswood Development Company's main building
partner, only offered two product lines in Mont Belvieu. Those were the exact same product lines
that Friendswood Development Company offered in Ashbel Cove and Baytown Crossing with one
caveat, Friendswood Development Company required Lennar to add a third-car garage that they
did not require in Mont Belvieu. Mr. Johnson opined Baytown should be proud that they were
outselling Mont Belvieu two and a half to one.
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Page 6 of 8
In closing, Mr. Johnson hoped he addressed every concern. He requested Council's support to
grow that vision set out four years ago to deliver that identifiable community with quality housing
options that provided families the opportunity to not only work in Baytown, but to live and play
in Baytown. Mr. Johnson was aware Friendswood Development Company was there without
staff's recommendation, but he would appreciate Council's support.
Council Member Johnson inquired for the price point of the homes in Mont Belvieu. Mr. Johnson
noted that would be an excellent example of the difference between an ETJ MUD and a Public
Improvement Districts (PID). The same product lines in Mont Belvieu were selling for$80,000 to
$100,000 more. Council Member Johnson questioned if that included the same building materials
and Mr. Johnson replied they were the exact same quality. On the sixty-foot homes in Baytown,
Friendswood Development Company required a third-car garage with additional costs on that one
product. Council Member Johnson further inquired for the size of the homes in Mont Belvieu. Mr.
Johnson answered they varied, but their minimum was eighty feet wide. Mayor Capetillo noted
the county had a fifty-foot minimum. Lastly, Council Member Johnson queried for the lifespan of
the MUD. Mr. Johnson relayed the initial term on the SPA was thirty years from January 2019, so
in 2049 the term would expire. Council Member Johnson clarified there would then be no new
bonds after 2035. Mr. Johnson confirmed to address the concern of the MUD not going away,
Friendswood Development Company would propose to not sell new bonds without the City's
consent after December 31, 2035.
Mayor Capetillo wondered if Friendswood Development Company looked at a mix of larger lots.
Mr. Johnson stated they offered that in Mont Belvieu, but their company had the competitive data
that said more people were interested in what was offered in Baytown Crossing. Nonetheless,
Mayor Capetillo heard people that purchased those traditional sized lots that wished they had more
space. Mayor Capetillo asked Mr. Johnson if they would consider marketing bigger sized lots. Mr.
Johnson believed that would be something their company would consider.
Council Member Johnson wondered if people preferred the lots in Baytown because they were
$80,000 to $100,000 less. Mr. Johnson replied that was absolutely a part of it as an affordable
home buying opportunity. Council Member Alvarado believed that came back to the question did
Baytown not deserve to have the higher price points? Mayor Capetillo relayed that was why he
asked Friendswood Development Company to consider his offer. He expressed hesitancy on the
sixty-five-foot-wide lots. Council Member Johnson questioned if when Friendswood Development
Company considered the offer, would the company come back and say they would change things
up, for example: have sixty-five, seventy, or seventy-five-foot lots. Mr. Johnson replied he could
propose that;however,he expressed hesitancy on going from a mix that was proven to completely
change to sixty-five, seventy, seventy-five lots. On the other hand, Mr. Johnson would like to see
if 5% of the future home sites in the expansion tract have some percentage of that, or at some
specific location, they go the other way and limit where they would build the smaller product. Mr.
Johnson relayed Friendswood Development Company would be open to that and only asked for
Council's support.
Ultimately, Council Member Alvarado wondered what kept Friendswood Development Company
from a PID and why they preferred a MUD. Mr. Johnson answered through an ETJ MUD they
were able to finance almost$40,000 per home. In a PID, for the same effective tax rate, they could
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April 28,2022
Page 7 of 8
only finance $21,000 per home site. Friendswood Development Company could invest more
money and offer a more affordable home product of the same quality through that ETJ MUD
structure.
Mayor Pro Tem Presley requested to hear more about some of the amenities that Mr. Johnson
previously stated their company could do more of. Mr. Johnson repeated the list he had given of
what was that $175 million of private investment. Council Member Powell asked whether the
homes themselves changed at all if it were a PID versus a MUD, or was Mr. Johnson only talking
about amenities. In their scenario, Mr. Johnson relayed Lennar typically had one product line for
forty years, and one for fifty. Thus, Lennar would build the same product in Mont Belvieu in
Baytown Crossing, the same product line whether it would be a PID or a MUD. Although, Mont
Belvieu was not necessarily doing it with the same landscaping package, the forty-foot home sites,
nor the two-yard tree on a street requirement in Baytown Crossing, Mr. Johnson stated that was a
unique requirement they did not have in Mont Belvieu.
Aside from the amenities previously mentioned, City Manager Rick Davis inquired what were the
things Friendswood Development Company were investing in their community that the City was
not asking for. Mr. Davis noted in their last meeting it was alluded Friendswood Development
Company had capital costs that were driving up the costs that were needed in the City's
perspective. Mr. Johnson relayed they have identified what their company called the "quid pro
quo" projects that they believed added regional benefit, including: North Main improvement,
similar to Garth Road, and the trail plan. Mr. Davis queried about drainage. Mr. Johnson stated the
existing Baytown Crossings drained through storm water pump systems through roadside ditches.
Their new track allowed them to drag that depth of gravity flow all the way to Garth Road. That
would be two miles worth of width that would benefit from the regional drainage channel
Friendswood Development Company would provide.
Additionally, Mr. Davis noted Mr. Johnson mentioned their company committed to not issuing
debt without Council consent after 2035. Mr. Davis notified Mr. Johnson that Council would have
to consent to all debt Friendswood Development Company would issue anyway. However,
Council's approval was fixed on a finite number of criteria. Thus, Mr. Davis asked Mr. Johnson
how would they reconcile that as Council had little latitude to say "no" to MUD issuance. There
would have to be a different kind of process after 2035. Mr. Johnson deferred to his attorney, Tim
Green. Mr. Green stated the City could put in the resolution a provision that stated Friendswood
Development Company would not issue any debt after December 31, 2025 without the City's
review and approval, that was separate from the regular process and could be binding upon
Friendswood Development Company.
Council Member Johnson asked who would maintain the upkeep at the two miles worth of gravity
flow because Baytown had issues with the county of keeping their ditches. Also, he asked why
could Council not say no more would be issued after 2030 instead of 2035 and what would their
tax rate be. Mr. Johnson stated their SPA from four years ago tried to contemplate some of that
and as of that moment, the tax rate for the district was set at $1.45. Since the company were
operating in an ETJ, there would be no city taxes within their boundary. Mr. Johnson noted there
were provisions in their SPA where the MUD agreed not to reduce the tax rate below the city's
current tax rate, at that time,plus the then-existing operations and maintenance budget of the MUD.
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April 28,2022
Page 8 of 8
Mr. Johnson commented that may generate some additional debt service tax that would allow
Friendswood Development Company to accelerate some of the debt payments.
To Council Member Johnson's maintenance question, Mr. Johnson answered that as long as the
MUD existed it would be the responsibility of the MUD. Mr. Johnson informed Council that would
be where the majority of the Operation and Maintenance Tax would go towards, which was
contemplated in the SPA as well. Upon annexation, the City could leave the MUD outstanding for
the sole purpose of maintaining those facilities. The reason Friendswood Development Company
liked that was because the MUD had certified engineers and consultants who understood
hydrology,the facilities, and could manage those storm water facilities better than a Homeowner's
Association. Mr. Johnson noted, however, that would be made at the City's discretion at the time
the City chose to annex.
Council Member Alvarado inquired who would be on that MUD Board. Mr. Johnson replied the
MUD Board already existed. With the annexation, it would be the same MUD Board that presided
over MUD No. 213. Council Member Alvarado further inquired if there were residents or locals
on the board. Mr. Johnson did not believe so and Mr. Green did not think, as of yet, anybody had
requested to be on that board. Mayor Capetillo wondered how many board members there were
which Mr. Johnson answered five. In regards to that MUD Board, Mayor Capetillo believed it
would help if they had people who lived in the neighborhood. Mr. Johnson relayed as soon as there
were interest from residents, there would be an election process. Council had further discussion
expanding on that note.
At 6:24 P.M., Council Member Betancourth stepped out.
Mayor Capetillo expressed his appreciation for Mr. Johnson addressing some of the questions that
Council presented. Likewise, Mr. Johnson thanked Council for their time and consideration.
2. ADJOURN
With there being no further business to discuss, Mayor Capetillo adjourned the April 28,
2022, City Council Regular Work Session at 6:25 P.M.
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