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2004 01 22 WS MinutesMINUTES OF THE WORK SESSION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN January 22, 2004 The City Council of the City of Baytown, Texas, met in work session on January 22, 2004, at 4:30 p.m. in the Hullum Conference Room of Baytown City Hall, 2401 Market Street, Baytown, Texas, with the following in attendance: Ronnie Anderson Coleman Godwin Calvin Mundinger Don Murray Mercedes Renteria III Scott Sheley Pete C. Alfaro Gary Jackson Bob Leiper Ignacio Ramirez, Sr. Gary W. Smith Council Member Council Member Council Member Council Member Council Member Council Member Mayor City Manager Assistant City Manager City Attorney City Clerk The meeting was opened with a quorum present after which the following business was conducted: Discuss tax abatement criteria and guidelines. City Manager, Gary Jackson, explained that the City may adopt tax abatement guidelines and criteria. The guidelines and criteria expire after two years and must be readopted. The most recent guidelines and criteria for the City of Baytown expired in September 2001. Consideration of the guidelines and criteria was delayed until after the industrial district contract negotiations. Staff reviewed the tax abatement guidelines and criteria from Chambers County and Hams County. The previous City guidelines and criteria were modified to more closely follow the policies of the two counties. The changes tend to follow Harris County's policy more than Chambers County's policy because most of the eligible property is in Harris County. Staff worked with the Economic Development Foundation to develop the proposed guidelines and criteria. There is a provision for variances to allow tax abatement for a desirable proposed development that does not meet all the requirements of the guidelines and criteria. A variance must be approved by a three - fourths vote of the Council. A chart comparing the proposed guidelines and criteria to those approved in Baytown and those approved in Chambers County and Hams County was reviewed. Mike Shields, Executive Director, Baytown -West Chambers County Economic Development Foundation, explained that tax abatement helps in being competitive in attracting new businesses. Tax abatement applies on new development only. There is no abatement on existing taxable property. Only the value that increases from new development is subject to abatement. Page 2 of 4 Minutes of the Work Session – January 22, 2004 Mr. Jackson stated that the item was scheduled for discussion at this meeting. It will be reviewed with the Economic Development Foundation during the next week. The item will included for discussion at the February 12 work session and for action during the February 12 Council meeting. Discuss Enterprise Zones and proposed incentive policy. Bob Leiper, Assistant City Manager, explained that the new legislation on enterprise zones does not impact existing enterprise zones or the incentives offered there. Baytown has one existing enterprise zone, Enterprise Zone No. 2. The new legislation has two significant parts — enterprise zones and enterprise projects. An enterprise zone now automatically exists in a census block group that meets the poverty level criteria (20% below median income). City Council may establish incentives to be offered to a development in a new enterprise zone. An enterprise project is outside an enterprise zone and must meet criteria established by the State. A city may only have four projects and the State may only approve eighty -five projects in a biennium. The City must adopt incentives if the City desires to encourage development in zones or to nominate a project to the State. The incentives offered in Enterprise Zone No. 2 are as follows: standard tax abatement (if applicable), limited tax abatement (if applicable), waiver of permit fees, waiver of tap fees, and one -stop permitting. It is proposed that the City offer incentives in a new enterprise zone as follows: standard tax abatement (if applicable), limited tax abatement (if applicable), Industrial District Agreement (if applicable), waiver of permit fees, waiver of tap fees, and one -stop permitting. It is proposed that the City offer incentives for a project outside a zone as follows: standard tax abatement (if applicable) and Industrial District Agreement (if applicable). There must be differentiation between the incentives offered within zones and outside of zones. Mayor Alfaro and Council Members Anderson, Godwin and Murray signed and filed affidavits of a conflict of interest relating to ExxonMobil. Mr. Leiper continued and stated that the proposed ExxonMobil project is in a new zone. If the City nominates the project to the State, ExxonMobil may realize State incentives. There will be no impact on the City from the nomination. Mr. Shields explained the history of Enterprise Zones 1 and 2. Zone 1 involved the U. S. Steel property and it is no longer an enterprise Zone. Enterprise Zone 2 has the El Toro Maza Factory within it. Discuss sales tax options. Mr. Jackson reminded Council of the prior discussions of sales tax election options and the specific information related to street maintenance sales tax. Mayor Alfaro requested background information on the Crime Control and Prevention District in response to allegations that expenditures were not properly made. Mr. Jackson responded by reviewing Local Government Code, Section 363.151, which provides that the Crime Control and Page 3 of 4 Minutes of the Work Session — January 22, 2004 Prevention District may finance all costs... including costs for personnel. All other cities that have adopted a crime control and prevention district, except Argyle and Keller, use CCPD funds for personnel. Other handouts included the original two -year budget, a memorandum from Bobby Rountree, former City Manager, and information developed by former Police Chief Charles Shaffer used to explain the then proposed crime control and prevention district to the community. These handouts reflected that the proposal for the crime control and prevention district included the use of district revenue for personnel purposes. Council Member Sheley supported inclusion on the May ballot of a proposition for a street maintenance sales tax with an education campaign to explain how the funds will be used. Council Member Murray expressed support for the street maintenance sales tax to be used as set forth in the December 11, 2003 memorandum from the City Manager. Council Member Mundinger supported the street maintenance sales tax with using the revenues to offset general fund expenditures to provide addition DOT officers. Council Member Anderson supported the street maintenance sales tax with the use of the revenue to offset general fund revenues to provide for the senior citizen tax freeze. Receive and discuss the report and recommendations of the ad hoc Council Committee on Charter Review. Council Member Anderson reported that the committee and discussed the process for appointment of the Charter Review Committee. The ad hoc committee submitted two timelines for Council to consider. The first option is completion prior to May 2005, providing a comprehensive review of the entire charter with recommendations to be presented on the May 2005 election. The second option is completion prior to May 2004, allowing specific City Council selected revisions to be addressed in the May 2004 election and further revisions as needed in the May 2006 election. Mayor Alfaro urged Council to reconsider its action at the last meeting concerning appointment of the Charter Review Committee to clarify its meaning. Council discussed establishing the timeline for the committee and reasonableness of presenting amendments on the May 2004 election. Council Member Murray stated that the Committee will need time to become familiar with the Charter and city government. Council Member Mundinger stated that the Committee must be given a reasonable time to review the Charter. Receive and discuss the report and recommendations of the Municipal Court Judge Committee. Council Member Murray reported the recommendation of the committee. The recommendation is subjective and was not unanimous. He recited the motions he proposed to make, Andy Helms as Municipal Judge, from February 1, 2004 to January 31, 2006, part-time, with a stated compensation and Randy Strong and Kelly Benavides as Associate Municipal Judge, from February 1, 2004 to January 31, 2006, with stated compensation. Mr. Helms expressed interest in serving as Municipal Judge. Mr. Strong and Ms. Benavides each expressed interest in serving as Associate Municipal Judge. Page 4 of 4 Minutes of the Work Session — January 22, 2004 In response to a question, Council Member Murray stated that Larry Bailey was not recommended based on the information contained in the altomey- client memorandums and in the performance reviews. Council discussed the reasonableness of the recommendation and the preference for reappointing Larry Bailey. Council expressed an interest in reviewing the information related to Larry Bailey's performance evaluations and reviews. Discuss downtown redevelopment. There was not sufficient time to discuss this item. Discuss appointments. Baytown Industrial Development Corporation Board. Council Member Sheley announced that he was not ready to make a nomination at the meeting. There was not sufficient time to discuss appointments to the Charter Review Committee and the appointment of Municipal Courtjudges. Adjourn. There being no further business, Council Member Murray moved adjournment. Council Member Renteria seconded the motion. The vote follows: Aye: Council Members Anderson, Godwin, Mundinger, Murray, Renteria, and Sheley Mayor Alfaro Nay: None. The motion carried and the meeting adjourned at 6:27 p.m. !s Ga W. Smith City Clerk