2016_09.19-20 CC MinutesWORK SESSION - 5:30 PM
REGULAR SESSION - 7:00 PM
I. CALL TO ORDER
Mayor Johnson called the meeting to order at 5:36 p.m.
II. WORK SESSION
*NOTE. Pursuant to Section 551.071. Texas Government Code. the Citv Council reserves
the right to adjourn into Executive Session at any time durin_g the work session or the
reqular session to discuss posted executive session items or to seek legal advice from the
City Attorney on any item posted on the agenda.
A. Receive water rate committee report
Water/Wastewater Rate Review Committee Chair Ernest Harvey presented the results and
recommendations of the Committee's review to City Council. Mr. Harvey provided an overview
of the City's current position, stating that the current purposed budget would bring in $4.6 million;
$2.6 million from water and $1.9 - $2 million from sewer. Previously, there was a revenue
shortfall of $1.4 million, which lead to the current increases. He added that because most costs
are fixed, we moved our recovery to a base rate system.
He continued with an overview of how impact fees work; stating that they are not fees that take
care of the development of subdivisions. Developers put the infrastructure in place within the
subdivision and then donate those lines back to the city for maintenance; basically, impact fees
are a contribution into the expansion and growth of the City. These fees go into a Capital
Improvement Fund for future enhancements and expansion of the City.
Mr. Harvey provides some background stating that originally, Kennedale pumped all their own
water and the cost of that was about $0.33/1,000 gallon to pump and treat; but demand outgrew
the amount we could pull from the aquifers. We added Fort Worth as a second water supply,
with an average cost of $2.96/1,000 gallons. That cost has increased by about 34% over the
past 5 years. Additionally, he added that about 40% of our water still comes from the wells. The
combined cost per 1,000 gallons to pump and treat (not distribute, store, etc.) is about
$1.91/1,000 gallons. Sewer costs have also affected rates. A lot of work has been done to
minimize inflow & infiltration (I & 1) in an attempt to cut costs in the long -term. The Arlington
sewer cost is about 2.5 times what it was five years ago, and about 90% of our water flows
through Arlington.
He stated that the cash balance of the Water /Sewer Fund has been dwindling since 2008
because it has been used for short -falls in the budget and funding projects as they come
405 Municipal Drive, Kennedale, TX 76060 1 Telephone: 817 -985 -2100 1 Fax: 817 -478 -7169
forward. Where did the money go? City Manager Bob Hart stated that the increases of overall
costs incurred by the city to provide this service between 2013 and 2017 were 76 %. The
proposed revenues for FY16 -17 are $4.99 million. Our only revenue source for the water /sewer
fund is utility billing. We cannot supplement with other revenues like other cities that can sell or
transport water. Operations take up the bulk of the expenditures (total of $4.829 million) at 53 %.
The Committee focused on the sundries to see if there was anywhere to save or adjust.
Sundries are in the "variable cost" line item. That's where the Committee started seeing an
opportunity to free up revenue. He stated that they feel their input has influenced the FY16 -17
budget.
The AWWA sets the meter increase formula. You find your smallest meter and set that as 1, and
then you multiply from there for larger meters with larger flows. The previous committee used
this formula and set the %" meter as 1, and set that base rate. Then the larger meter base rates
were set using the AWWA formula. He showed the current rate based on those calculations;
pointing out that the first 5,000 gallons was supplemented because the cost to the city is more
than $2.00/1,000 gallons.
Mr. Harvey listed the Committee recommendations:
• Establish a Utility Advisory Board to have increased citizen participation
• To conduit an annual Water/Wastewater Rate Review
• Adjust franchise fees to 4% (minimum); create a new line item and let it reflect the actual cost
plus 20%
• Reduce /adjust administrative fee (paid to general fund) and review annually
• Change the issuing of bond governance; Lower threshold of what would qualify as a bond. For
example, if we see that we're going to grow over the next 5 years, consider a large bond
election to reduce the impact on our reserves. We need to make bonds a common practice
• Reconsider leveraging water /wastewater reserves. Use other financing options to fund TIRZ or
Master Plan projects rather than loaning it from the water /wastewater fund reserves
• Increase the current $15 Senior Discount to $25; Ensuring the proper storage and destruction
of private information used to establish these discounts
• Create a donate system to those who can't afford these rates. To provide an option on the bill
for residents to donate to those who need assistance. This service should be handled by a
third -party and solely benefit Kennedale utility users
• Offer a discount for downsizing meters. It costs about $750 to $1,000 to swap (excluding
plumbing needed on your personal side). The Committee recommends a $200 discount. This
would reduce revenues, but it would also reduce the necessary capacity on the system
• Recommend providing a low- income discount for all ages
• Establish a Finance Advisory Board to review budget, audit, bonds, etc.
Mr. Harvey added that the Committee talked to residents last week and several suggested going
back to the original rates. This is not a viable option because it is a decrease of $2 million; so
the Committee looked at the old rates plus 10 %. That would leave us with a $1.827 million
shortfall. These calculations do not include any of our recommendations. He noted that the
Committee wanted to show what a straight 10% increase would look like.
Page 2 of 17
The following were the three (3) options presented to City Council:
• Rate Option 1: Consultant Carolyn Marshall queried the Public Utility Commission (PUC) to
see how they did their rates. The PUC start at 1 for a 5/8" meter (instead of 3 / ") which shifts all
rates above 3/4" down. This option will leave a $36,000 shortfall; which the Committee feels is
something that could be dealt with. You also have to remember to add $28,000 for the senior
discounts and the possible reduction in meters, estimated at $45,000. He noted that in all
these options, the Committee did not change the sewer rates because most of that is fixed
costs. He added that until they can resolve the large increases in sewer costs, they can't
recommend a change.
Option 1 is the option that the Committee is recommending to Council.
• Option 2: Stay at base rate and offer suggested discounts; this option will leave no shortfall
other than discounts.
• Option 3: To give a greater discount, but the risk becomes greater with these larger decreases.
It is not really much of a discount per household, but leaves you with a $273 million shortfall
before additional discounts. Council could decide not to do capital projects such as Crestdale,
and give this discount. Putting that project off would cover the shortfall, but it would push those
improvements into another fiscal year budget; or even split it between two fiscal years. But
you're really only offering an $8.00 decrease.
He pointed out that in these options they had to increase the volume rates to decrease the base.
You can pick and choose any of these recommendations or rates.
In conclusion, he provided potential future savings:
• The staff is still working on the I & I reduction; once this can be reduced, there are some
savings, but we're spending up front
• Long -term sewer treatment options; look at what Arlington is charging us vs. Fort Worth. You
might want to shift more over to Fort Worth.
• The same deal applies to the long -term water supply. Multiple sources for water, look at
Arlington as an additional source
• Customer usage modifications; tiers are to encourage methodology
• The City's current billing and collection contract with FATHOM; there are opportunities, but you
have to look at fulfilling contracts and how the changeover would work
He provided a timeline to show how long it will take to implement any rate changes that Council
may approve. He noted that the estimated new rates would be on the December billing. In
closing, he once again stated that these are the Committee's recommendations, Council may
pick and choose, or modify the recommendations as they see fit.
B. Discussion of items on regular agenda
No items were discussed at this time. Council took a break before the regular session.
Page 3 of 17
III. REGULAR SESSION
Mayor Johnson opened the regular session at 7:03 p.m.
IV. ROLL CALL
Present: Frank Fernandez, Brian Johnson , Kelly Turner, Liz Carrington, Charles Overstreet,
Michael Walker
Absent: None
V. INVOCATION
Covenant Life Baptist Church Pastor Greg Adams provided the invocation.
VI. UNITED STATES PLEDGE AND TEXAS PLEDGE
"Honor the Texas Flag; I Pledge Allegiance to Thee, Texas, One State under God; One and
Indivisible."
VII. VISITOR/CITIZENS FORUM
At this time, any person with business before the City Council not scheduled on the Agenda may
speak to the Council, provided that an official `Speaker's Request Form' has been completed and
submitted to the City Secretary prior to the start of the meeting. All comments must be directed
towards the Mayor and Council, rather than individual council members or staff. All speakers must
limit their comments to the subject matter as listed on the `Speaker's Request Form.' No formal
action or discussion can be taken on these items.
Lynn Harris, 5010 Hawkins Cemetery Road, Arlington, stated that he would like to move back to
Kennedale, but he has concerns regarding the remediation of the salvage yards and race tracks.
He added that they are building some nice homes in these areas which will help the tax base.
However, he'd like to see proper use of the land.
LaCresha Sanders, 5200 Andalusia Trail, Arlington, spoke to Council and citizens regarding the
Wildcat Festival at R.F. Patterson Elementary on Saturday, October 29, 2016. She stated that they
will be having a Fun Run and Keep Kennedale Beautiful (KKB) will be planting a tree that day. She
invited all residents to attend and stated that they are still looking for sponsors and vendors for the
event. Additionally, she provided handouts for the event.
VIII. REPORTS /ANNOUNCEMENTS
In addition to any specific matters listed below, the city council may receive a report about items of
community interest, including but not limited to recognition of individual officials, citizens or
departments, information regarding holiday schedules, upcoming or attended events, etc.
A. Updates from City Council
Liz Carrington informed the group that the Arlington watershed meeting will be this Thursday at
Hughley in Burleson. It was noted that the Arlington watershed is the water that flows into Lake
Arlington, and that the meeting is to discuss possible ways to protect it from pollutants.
Kelly Turner stated that he attended the Emergency Preparedness Planning Committee (EPPC)
and the Regional Emergency Planning Advisory Committee (REPAC) meetings this past month.
He informed the group that there are sixteen North Texas counties that come together to share
ideas and work together on emergency preparedness. The Committee looks at making sure we
are more prepared for emergencies that come through the area. He stated that this past year
the state locally funded $1.8 million for these efforts; a lot of those funds responded to tornadoes
that occurred this past Christmas. He added that they will soon be having forty -eight mock
Page 4 of 17
scenarios to practice the utilization of these resources, and that he hopes to share some of
those locations next month. It was noted that these resources are accessible to Kennedale in
the case of another tornado like the one 4 years ago.
Charles Overstreet stated that he and Mayor Johnson attended a reception for the new
Chancellor for Tarrant Community College (TCC), and they also attended the 911 Memorial
Ceremony at TownCenter Park. He added that there was a nice turnout for the 911 Memorial
Ceremonies.
Frank Fernandez stated that he also attended the 911 Memorial Ceremony at TownCenter Park.
B. Updates from the Mayor
Mayor Brian Johnson stated that he attended the Tarrant Regional Transportation Coalition
Executive Board meeting and that the big issue right now is the 1- 20/820/287 interchange. The
state has allocated an additional $36 billion over a ten -year period, noting that it is the number
one priority for this area. That means it will take about a decade to get there. He also attended
the Southeast Tarrant Transportation Partnership (SETTP) meeting; he added that they
are getting a lot of support from Arlington, Mansfield and Grand Prairie to push the 1- 20/820/287
project forward. He added that he has been meeting with the Mayor of Burleson and they are
working on a Community Summit to create healthy communities and opportunities for young
people. In closing, he noted that he will be reading at the pancake supper at Delaney
Elementary.
C. Updates from the City Manager
• 2015 CAFR Award
City Manager Bob Hart reported that the Kennedale Finance Department received the 2015
Comprehensive Annual Financial Report (CAFR) Award for our annual audit again this
year. Additionally, he added that the citizen opinion survey will begin around October 1st,
and will be used for the basis of the community -wide strategic plan update. The Mayor noted
that the last update was in 2009 and that the strategic plan is what Council bases all their
decisions on.
IX. MONITORING INFORMATION
Monitoring information updates are in the agenda packet for review.
A. Monthly Financials - July and August 2016
B. Executive Limitations
C. Ends Review - Balanced Scorecard
X. REQUIRED APPROVAL ITEMS (CONSENT)
All matters listed under incidental items (consent) have been previously discussed, require little or
no deliberation, or are considered to be routine by the council. If discussion is desired, then an
item will be removed from the consent agenda and considered separately.
A. Consider approval of minutes from August 12, 2016 special budget workshop meeting
B. Consider approval of minutes from August 15, 2016 regular meeting
C. Consider approval of minutes from September 8, 2016 special meeting
Page 5 of 17
D. Consider casting a ballot for the Texas Municipal League Intergovernmental Risk Pool Board
of Trustees Election.
E. Consider approval of Library Memorandum of Understanding for a family place grant through
the Texas State Library and Archives Commission (TSLAC)
F. CASE # PZ 16 -09 To consider approval regarding a request by CHC Development for a final
plat of the Glen of Village Creek (formerly Swiney Estates, plat abandoned by instrument
numbers D214210746 and D216057891, PRTC) for approximately 15.982 acres located on
Bowman Springs Rd, generally located south of Swiney Estates Block 1 Lot 4R, west of
Bowman Springs Rd, north of Winding Creek Rd, and east of 1141 Bowman Springs Rd. The
plat will create 35 residential lots and 3 open space parcels. Property addresses include 1201,
1305, & 1307 Bowman Springs Rd.
Motion To approve all required approval Items on (Consent) agenda. Action Approve, Moved
By Charles Overstreet, Seconded By Frank Fernandez.
Motion passed Unanimously
XI. DECISION ITEMS
A. CASE # PZ 16 -10 Public Hearing to receive public comments and consider Ordinance No.
605, adopting a Unified Development Code to regulate land use within the City of Kennedale;
establishing zoning districts to regulate and restrict the use of property for residential,
commercial, industrial and other purposes; regulating parking, landscaping, screening, lighting,
signs, building design and materials; providing for the submission of site plans, subdivision
plats and other development applications; providing regulations for flood damage prevention,
stormwater protection, erosion and sediment control; and providing for procedures for review,
approval and administration of these regulations.
1. Staff presentation
2. Public Hearing
3 Staff response and summary
4. Action by the City Council
City Planner Rachel Roberts provided the staff presentation stating that we have been working
on this project for over a year. She stated that in 2012 the City adopted an updated
Comprehensive Land Use Plan; the new plan set forward recommendations for the Village
Districts (small mixed -use districts) and looked at the intensity of development, and encourages
connectivity. Unfortunately, our zoning regulations didn't allow the implementation of these
comprehensive plan ideals; and up until now, you had to cross - reference multiple documents
and codes to ensure you met standards. Last year, the City hired LSL Planning to update our
regulations and it was determined that the best approach was to develop a Unified Development
Code (UDC); which would list all codes and regulations in a single document. Rachel stated that
LSL Planning met with the City and toured it. They also met several times with the Advisory
Committee, town hall meetings were held, user groups, workshops, online visual preference
survey, and public forums were all used.
Rachel provided a power point presentation that highlights the new provisions that included:
• Use regulations; we have updated and condensed the schedule of uses
• Traffic Impact regulations
• Updated the plan development regulations
Page 6 of 17
• Landscape and lighting
• Zoning districts; our existing zoning districts are still in place and no zoning will be
changed with the adoption of the UDC. This simply adds additional regulations for those
districts.
She stated that staff is recommending an effective date of October 1, 2016. The Planning and
Zoning Board considered this UDC update at their August meeting, and recommended approval
with the now - included edits
Rachel listed all the Board member and the Mayor questioned if we had a turn -out for the public
meetings. Rachel replied that we did not have much turn -out, but we did get a decent response
to the online visual survey. There was some discussion concerning historical districts,
apartments, and if non - compliant properties will be grandfathered in. Councilman Turner stated
that the UDC was very well done and thanked everyone one for all their hard work putting it
together.
Public Hearing:
Mayor Johnson opened the public hearing;
Robert Mundy, 712 Shady Creek Drive, stated that he had the privilege to participate on this
committee, and that he approached this very cautiously because zoning is very important for
both present and future citizens. He stated that staff did an excellent job supporting the
committee; but it is difficult to take all those documents and roll them into one. He added that it
is necessary to do so if the City is going to move forward and that there are other advantages.
Hopefully, it will decrease city legal costs, both in updating codes, and in opening ourselves up
to suits. He feels it will help get projects going and reduce citizens' complaints. It is a real step
forward for the City. He added that with a change this drastic, there will likely be improvements
that will be necessary down the line. He encouraged Council to approval the Unified
Development Corporation.
Mayor Johnson closed the Public Hearing.
Staff response and summary:
Rachel Roberts stated that staff recommends approval. Mayor Johnson questioned if in the
past, was this a big problem for developers; stating that Kennedale has a reputation as not
being business - friendly. Rachel replied that some of the developers probably try to hide their
frustrations because they want their project to move forward. She felt that it was more
frustrating for private residents and it was also frustrating for staff, which had to ensure they
looked up all the requirements. This is especially problematic when you have staff turnover. The
Mayor asked if there were contradictions. Rachel replied yes, when you update one code,
sometimes there are related regulations in other codes that go without updating.
Motion To approve Ordinance 605 adopting the Unified Development Code. Action Approve,
Moved By Kelly Turner, Seconded By Liz Carrington.
Motion passed Unanimously
B. Discuss and consider approval of Ordinance 612 fixing and levying municipal ad valorem
taxes for the City of Kennedale, Texas, for the fiscal year beginning October 1, 2016, and
ending September 30, 2017; directing the assessment and collection thereof; providing a
severability clause; and an effective date
Page 7 of 17
City Attorney Wayne Olsen stated that the City is adopting a rate that is not in excess of the
effective tax rate.
Motion To approve Ordinance 612 fixing and levying Municipal Ad Valorem Taxes.
Action Approve, Moved By Frank Fernandez, Seconded By Michael Walker.
Motion passed Unanimously
C. Discuss and consider approval of Ordinance 613 adopting the budget for the fiscal year
beginning October 1, 2016, and ending September 30, 2017; amending budget figures for the
prior fiscal year beginning October 1, 2015, and ending September 30, 2016; appropriating
resources for each department, project, operation, activity, purchase, account and other
expenditures; providing for emergency expenditures and expenditures as allowed by applicable
state law; providing for the filing of the budget as required by state law; providing that this
Ordinance shall be cumulative of all ordinances; providing a severability clause and providing
an effective date
City Manager Bob Hart provided a presentation of the FY2016 - 17 Budget; noting that the entire
annual operating budget and these presentations are on the city's website for citizen's to review.
He stated that the budget is a means document necessary to accomplish the means established
by Council., and that the Vision Statement came out of the Strategic Plan done in 2009. Bob
stated that the following areas of focus were used during this and the current year: Create a
community based on sustainable goals; Redevelop Oak Crest; Restore Village Creek; Establish
residential subdivision in Southwest Kennedale; Redevelop Kennedale Parkway; Develop an
excellent road network; Create an interconnected linear park system; and Build an organization
of excellence and innovation. Additionally, he provided a budget fact sheet, an update on short -
term and long -term projects, and a review of property taxes and exemptions.
It was noted that Council has completed a planning session, the review process and the
required public hearings. Staff is now bringing the recommended FY 2016 - 17 Budget forward
for City Council approval.
Motion To approve Ordinance 613 the adoption of the FY 2016 -17 Budget. Action Approve,
Moved By Charles Overstreet, Seconded By Kelly Turner.
Motion passed Unanimously
D. Discuss and consider approval for ratification of property tax rate in FY 2016 -2017 adopted
budget
Councilman Kelly Turner stated "I move to ratify the property tax increase reflected in the budget
which will raise $140,283 more revenue from property taxes than last year's budget, which is a
3.11 percent increase from last year's budget. The property tax revenue to be raised from
property added to the tax roll this year is $191,867 ".
Motion To approve ratification of the property tax increase per statement read aloud.
Action Approve, Moved By Kelly Turner, Seconded By Charles Overstreet.
Motion passed Unanimously
E. CASE # PZ 16 -03 Public hearing to receive public comments and consider approval of a
request by Hickman Consulting Engineers for MKP Associates, Inc. for a replat of
approximately 5.005 acres at 1209 Swiney Hiett Rd, being a replat of C C Swiney's Subdivision
Lot 1, Kennedale, Tarrant County, to create Falcon Crest Estates Block 1 Lots 1 -7.
1. Staff presentation
2. Applicant presentation
3. Public Hearing
Page 8 of 17
4. Applicant response
5. Staff response and summary
6. Action by the City Council
City Planner Rachel Roberts provided the staff presentation stating that the property located at
1209 Swiney Hiett Road is zoned R2 single family residential with no zoning chance purposed.
The property was originally part of a plat done in 1946, and most of the surrounding properties
have redeveloped or subdivided since that time. This property has one house on it and has
changed ownership; they wish to redevelop at this time.
She stated that the Comprehensive Land Use Plan shows this neighborhood is part of a
neighborhood character district, which should be primarily residential in nature, and the
purposed replat is for residential. Additionally, she stated that standard street regulations apply
and the plat conforms to the Comprehensive Lane Use Plan.
Staff and City Engineers have reviewed the plat drawings and they meet technical specifications
and the lots purposed meets the R2 zoning requirements. Staff considered the requirements to
be met by the applicant and recommend approval of the replat. She reminded Council that if a
plat meets all city requirements, you are required by state law to approve it.
Rachel noted that the Planning and Zoning Board considered this case at their September 15th
meeting, and held a public hearing with two property owners questioning draining. We have
obtained additional information about that and then voted to recommend approval.
Adlai Pennington with MKP Associates was available to answer questions in regard to the
applicant presentation. There were a few questions from Council regarding location and lot size.
Public Hearing:
Mayor Johnson opened the public hearing; there was no one present requesting to speak.
Mayor Johnson closed the public hearing.
Motion To approve a replat of approximately 5.005 acres at 1209 Swiney Hiett Road. Action
Approve, Moved By Liz Carrington, Seconded By Michael Walker.
Motion passed Unanimously ,
F. CASE # PZ 16 -11 Public Hearing to receive public comments and consider approval of a
request by Ashton Holdings for a replat of approximately 0.988 acres at 408 3rd St, being a
replat of Soto Addition Block 1 Lot 1 R, Kennedale, Tarrant County, to create Soto Addition Lot
1 R -1 and 1 R -2.
1. Staff presentation
2. Applicant presentation
3. Public Hearing
4. Applicant response
5. Staff response and summary
6. Action by the City Council
City Planner Rachel Roberts provided the staff presentation stating that the property located at
408 3rd Street is in the Old Town sub - district, off the intersection of Cory A. Edwards and 3rd
Street. Rachel noted that this property has been vacant for some time except for some out
buildings that have recently been removed. Additionally, the property has been subject to
drainage issues; however, it is not the source of the problem. Staffs is aware of the situation and
Page 9 of 17
are working on a plan to resolve the issues. City Engineers have looked at the property and
development will not exasperate the situation.
She stated that the surrounding property is primarily single family residential with some duplexes
and quad - plexes nearby. She added that the lot is larger than required by zoning regulations.
She stated that they looked at the plat for compliance with the Comprehensive Land Use Plan; it
shows this neighborhood as part of the Downtown Village character district. This should be
based on the original street grid and block pattern, and usage should include a mix of residential
and businesses. The proposed plat does preserve the existing block pattern and the streets,
where they front, have with a 50 foot right -of -way; this is in compliance with the
future transportation plan.
The technical specifications and the lots purposed for Old Town has been met. No plans are
required for a development of this size; however, plans are required as part of the building
development and staff will be reviewing to make sure they meet our code and drainage
requirements. Staff considered the requirements to be met by the applicant and recommend
approval of the replat.
Rachel noted that the Planning and Zoning Board considered this case at their September 15th
meeting and held a public hearing where several property owners expressing concern
about draining. Staff has informed the Public Works storm water staff and they will be contacting
the property owner as part of that project. Planning and Zoning voted to recommend approval.
Adlai Pennington from Ashton Holdings was available for questions.
Public Hearing:
Mayor Johnson opened the public hearing; there was no one present requesting to speak.
Mayor Johnson closed the public hearing.
Rachel reminded Council that if a plat meets all city requirements, you are required by state law
to approve it.
Motion To approve a plat of approximately 0.988 acres at 408 3rd Street. Action Approve,
Moved By Frank Fernandez, Seconded By Charles Overstreet.
Motion passed Unanimously
G. Consider approval of Ordinance 608 repealing Ordinance 589 water and sanitary sewer
rates for service
There was no discussion on this item.
Motion To approve Ordinance 608 repealing Ordinance 589 water and sanitary sewer rates.
Action Approve, Moved By Charles Overstreet, Seconded By Liz Carrington.
Motion passed Unanimously
H. Public Hearing to consider approval of Ordinance 611 approving the adoption of water and
sanitary sewer service rates as recommended by the rate committee
1. Staff presentation
2. Public Hearing
3. Staff response and summary
4. Action by the City Council
Page 10 of 17
Water/Wastewater Rate Review Committee Chair Ernest Harvey stated that this was fully
presented during the work session. He provided a brief review stating that as a committee, they
looked at the expenditures and revenues in the budget. He noted that many citizens have called
for a return to the previous rate, but that had a shortfall of about $1.5 million. Adding, that
pumping water from the wells is the most affordable, but we can't meet the demand; so, we
added Fort Worth as a water supply. He noted that right now, the average 1,000 gallons of water
costs us $1.91 to source, pump and treat; that does not cover storage or delivery.
He stated that this is where you can see the impact of the situation; we once were our own
source provider, but now we are a combined water source and as we keep growing we will
probably be sourcing at a higher percentage. Ernest provided a review of sewer cost, impact
fees, budget, where the money goes, and the rate structure. Anything that's more than a 25%
increase is unreasonable.
It was brought to the attention of those in attendance that state regulations require that cities
meet 70% of capacity. The city's aim is to keep the system at 75 -80% to allow for development.
There were lengthy discussions among Council and the Committee.
Committee Chair Harvey presented their recommendations as follows:
• Establish a Utility Advisory Board
• Adjust franchise fees to 4% (minimum); create a new line item; let it reflect the actual cost plus
20%
• Reduce /adjust administrative fee (paid to general fund) and review annually
• Change the issuing of bond governance; lower threshold of what would qualify as a bond.
• Reconsider leveraging water /wastewater reserves. Use other financing options to fund TIRZ or
Master Plan projects rather than loaning it from the water /wastewater fund reserves
• Increase the current $15 Senior Discount to $25; Ensuring the proper storage and destruction
of private information used to establish these discounts
• Create a donate system to those who can't afford these rates. Provide option on the bill for
residents to donate to those who need assistance.
• Offer a discount for downsizing meters. The Committee recommends a $200 discount.
• Recommend providing a low- income discount for all ages
• Establish a Finance Advisory Board to review budget, audit, bonds, etc.
The following were the three (3) options presented to City Council in regard to the rate structure:
• Rate Option 1: Consultant Carolyn Marshall queried the Public Utility Commission (PUC) to
see how they did their rates. The PUC start at 1 for a 518" meter (instead of 3 % ") which shifts all
rates above 3/4" down. This option will leave a $36,000 shortfall; which the Committee feels is
something that could be dealt with. You also have to remember to add $28,000 for the senior
discounts and the possible reduction in meters, estimated at $45,000. He noted that in all
these options, the Committee did not change the sewer rates because most of that is fixed
costs. He added that until they can resolve the large increases in sewer costs, they can't
recommend a change.
Option 1 is the option that the Committee is recommending to Council.
Page 11 of 17
• Option 2: Stay at base rate and offer suggested discounts; this option will leave no shortfall
other than discounts.
• Option 3: To give a greater discount, but the risk becomes greater with these larger decreases.
It is not really much of a discount per household, but leaves you with a $273 million shortfall
before additional discounts. Council could decide not to do capital projects such as Crestdale,
and give this discount. Putting that project off would cover the shortfall, but it would push those
improvements into another fiscal year budget; or even split it between two fiscal years. But
you're really only offering an $8.00 decrease.
He pointed out that in these options they had to increase the volume rates to decrease the base.
You can pick and choose any of these recommendations or rates.
Suggested opportunities for potential future savings:
• The staff is still working on I & I reduction; once this can be reduced, there are some savings,
but we're spending up front
• Long -term sewer treatment options; look at what Arlington is charging us vs. Fort Worth. You
might want to shift more over to Fort Worth.
• The same deal applies to the long -term water supply. Multiple sources for water; look at
Arlington as an additional source
• Customer usage modifications; tiers are to encourage methodology
The City's current billing and collection contract with FATHOM; there are opportunities, but you
have to look at fulfilling contracts and how the changeover would work
Mayor Johnson provided a review of how the committee was selected. He stated that he
selected only one person from the previous committee, Adrienne Kay to provide a historical
aspect. Ernest Harvey was asked to serve on the Committee because the Mayor has the
highest regard for him and his integrity; noting that Ernest will tell the truth whether you like it or
not, and he served as Chair for the Impact Fee Committee. He stated that Pastor Greg Adams is
always here every month at the Council meetings and he didn't like the water rates, so we
wanted his perspective. The Mayor added that he put Chris Pugh on the Committee because he
was the first one to speak at the April meeting and he expressed that communication need to be
improved. Gary Swan was part of the Shame of Kennedale group with opposing views, so we
wanted to include their views and asked some others from the group to be part of the
Committee. They said no, but suggested Cathy Brown. Additionally, it was noted that Bob sent
all of Cathy Brown's recommendations to the Council and they have all reviewed what she
recommended.
Public Hearing:
Mayor Johnson reviewed the rules and due to the large number of people signed up to speak,
he requested that everyone limit their speaking to three minutes.
Mayor Johnson opened the public hearing;
John Hivale, 418 Coker Valley Drive, requested to know why Cathy Brown resigned from the
Water Rate Review Committee. Additionally, he requested that Council allow the members of
Page 12 of 17
the Committee to individually speak without fear of intimidation or retribution. He stated that he
did support the questions brought forward by Councilman Fernandez. He noted that there are a
couple of other plans besides the AWWA that could have been applied, such as the Equity
Buying Method and the Incremental Cost Method. He stated that he has a lot more information
and questions to be asked.
Mayor Johnson requested that all the Committee members stand and address the issue raised
as to Committee members feeling intimidation or fearing retribution.
Committee member Adrienne Kay stated that she has been on three water committees and for
the record she was the one who encouraged Cathy Brown to participate on this committee. She
added that at no time did she feel intimidated; however, there was engaging debate and a lot of
passion on the subject matter. The Committee as a whole agreed to support the
recommendations, and she has no ill will or hard feelings toward anyone that she served on the
committee with.
Committee member Chris Pugh stated that he was never contacted by anyone from City Council
in regard to what we were discussing as a committee; City staff was assigned to help us and
they answered any and all our questions. Bob went to great length to respond to a lengthy
amount of questions. He added that there was very heated debate, and he thought that
everyone had ideas that went out, and decisions that did not. But, in the end, they voted
and majority rules. He stated that he didn't feel intimidated or that staff was trying to push their
ideas onto the Committee. Staff presented us with frameworks and we used that
to edit/manipulate the number until we came up with the options presented. He thanked the
group for the opportunity to serve and noted that he really learned a lot.
Committee member Gary Swan stated he was asked to join the committee, and now has more
appreciation for the people who work at the city full time. He stated that they looked at each
measure, debated each measure and voted on each measure. The vote didn't go some of our
ways at times, but at times it did. He stated that if he was not satisfied with the debate,
perhaps he didn't debate strongly enough. He does however side with the committee.
Committee Greg Adams stated that It was a pleasure to serve. He agrees with what everyone
has said; if we don't come together, this will do more harm than good. He added that he voted
for it, but is not completely satisfied with the outcome. Noting that his water bill won't change
one dime, but he feels like it is a start. The committee expects the rates to continue to move in
the direction we're suggesting, he has hopes that it will continue to improve. He stated that
Ernest did a great job leading, staff and Bob Hart did a great job of providing us information and
then leaving the decision to us.
Rockie Gilley, 220 S Dick Price Road, questioned the statement in the presentation
regarding Option 3 and the delay of the Crestdale repairs. He stated that wasn't the Crestdale
repairs approved in the budget? Mayor Johnson replied yes it would be removed from the
budget. Mr. Gilley stated that he guesses the budget is just a working document. He continued
that if you have a functioning steady stage system that functions, you do not need a triple digit
increase to repair and keep it functioning. Some amount of the increase is going to build out new
infrastructure for new development. He feels that they are hearing the rest of the story
tonight. He thinks there is a reasonable case for a 20 -25% increase and predicts that most will
only see a slight reduction. He defined an ordinary citizen as someone who is not a member of
the Chamber, EDC, P &Z, or an expert on government. The ordinary citizens of Kennedale have
minimal interest in the master plan and the rapid development of the city. He feels that the
ordinary citizen is not well represented in Kennedale. In closing, he added that the reasons for
Page 13 of 17
the large rate increases are to build new development and it is within Council's power to slow
down development. He requested that they consider that option.
Councilman Walker question Mr. Gilley on what option he would consider reasonable? He
stated that he would like to see a detailed breakdown of what cost goes to maintaining the water
system /repairs and what go out for new development; he would like voters to have a say in the
master plan; and he thinks that anything more than a 25% increase is unreasonable.
Pat Turner, 1013 Kennedale Sublett Road, voiced his disappointment in the way the community
has acted towards Council and staff regarding the rate increases; especially on social media. He
stated that Kennedale has the best and most educated Council that they have ever had; and the
same goes for city staff. He stated that negotiation is where both parties are equally dissatisfied
with the outcome. In closing he urged people to volunteer and be part of the solution.
Robert Mundy, 712 Shady Creek Drive, stated that he has served in various capacities over the
past 30 years and he know what a hard job Council has; noting that they are the representatives
for the people. He also realizes that it is hard not to say no to taxes and water rate increases;
however, it is their decisions that will keep the city in good running order. He feels that Council
and staff did their due diligence in the decision making process of the rate increase and in the
repealing of the increase... they listened. His recommendation to Council is that they continue to
do their due diligence and make sure to understand the options being presented this evening.
He added that we do not need to be changing the rate every six months
Jan Joplin, 204 Hilltop Drive, thanked Council and the Water Rate Review Committee for all
their hard work. She stated up front that knowing the process of the water rate committee, she
thought she had some ideas of what it would be like, but it wasn't what he expected, and she is
disappointed with that. She stated that during the presentation we heard a lot about risk for the
city; however the risk of high water rates is a burden to the citizens. She feels that what is
driving up the cost of water rates is all the additional items that are charged to the fund. She
noted that it would be interesting to take all that out and see what it looks like without all those
expenditures. She ask Council to buy and negotiate, to spend smart and to stay in budget;
noting that citizen's do not want that risk to the city, because is causes their own risk.
Councilman Overstreet question Jan if she feels the rhetoric surrounding this issue has been
blown out of proportion; if the committee is complete joke; and if this is a lost cause. She started
that she doesn't agree with the statements about corruption and conspiracies and that it is more
about choices. The process is not what it should be; she feels the citizens, as a whole, put on
these types of committees are not qualified to make such decisions.
Thomas Newsom, 303 Pennsylvania Avenue, stated that we have concentrated on fixed cost
and rates, but he questioned if there is a good understanding of what the rates start with. He
believes it is a two phase process, you establish the revenue requirements and if you are going
to collect that. He stated that it doesn't seem that there has been a lot of focus on the revenue.
He questioned what goes into the revenue requirements and why is it that the rates are based
upon the entire capital expenditures? He added that the city needs another form of notification
besides the Star Telegram; suggesting that notices be added to social media. He had questions
regarding the appropriations verbiage in the ordinance.
Mayor Johnson agreed that the notification process needed more options for citizens. City
Attorney Wayne Olsen provided a legal opinion on the notification requirements and the
verbiage in the ordinance.
Page 14 of 17
John Clark, 100 Meadowlake Court, stated that he would like to see the city focus on the issues
and the process. He addressed some of the statements that have been made and what could
happen when we are forced to make budget cuts, He stated that we need a balance; he does
not believe you can spend less in an emergency than if you plan for an expense. We need to be
good stewards, not just manage from crisis to crisis or to discount what is needed to secure the
city's future. We need to make reasonable, orderly decisions because hoping problems do not
occur is not a good plan; planning for what will occur is a better policy. He added that we know
there are problems in the structure, so we need to plan in advance for them. In closing, he
encouraged Council members to look around at all the good decisions they have made to
improve the city. He wished them luck.
Jack Dalyrmple, 1008 Oakridge Court, expressed his support for the City Council, City Manager,
City staff, and the Water Rate Review Committee. He stated that he was disappointed with the
way the rate increase was originally handled. However, he feels that Council is making a good -
faith effort to resolve a complicated issue in a manner that respects the best interest for all
concerned. He stated that he doesn't know all the facts, but he does trust in a representative
democracy. He listed several improvements that have occurred over the seven years he has
been in Kennedale and he appreciates the efforts of the city officials.
Jerry Bacon, 6712 Lindale Road, thanked Council for cleaning up all the SOB's in his area of
town. He added that he was disappointed in the rate increase and has had to adjust where his
money goes in order to pay the high bills. He feels the fixed rate on meter size is not a fair
system and asked if it cannot be prorated according to the amount of services used. He
questioned if it was possible to have some type of variable fixed rate instead of a totally fixed
rate.
Joe Taylor, 604 Bluebonnet Lane, stated that he appreciates Council's willingness to review the
rates and organize a committee. He feels it has been an honorable approach. He noted that
there is a fourth option and that is to haul water, and nobody wants that. He agrees with
statements made by Pat Turner and John Clark. He understands the challenges of
communication and working on boards. He thinks the improvement to the city the last several
years have all been good; that the city is moving the right direction; and that they have been
good stewards over the city. He encouraged others to be part of the solution.
Ronnie Nowell, 317 Bowles Court, stated that everything that he planned to say has been said.
However, he wanted to brag on City Manager Bob Hart. He stated that because of Bob and
past/present Council this city is growing and seeing improvements. He added that growth hurts
and that is what Kennedale is experiencing now. He hopes everyone will come together and
consider serving in some capacity. In closing, he offered the Mayor, Council and City Manager
words of encouragement quoting Franklin D. Roosevelt: "When you come to the end of your
rope, tie a knot and hang on."
Mayor Johnson closed the Public Hearing.
Staff response and summary:
Committee Chair Earnest Harvey stated that Council has heard from the Committee and from
citizens. They request that Council take action. Bob Hart stated that the Ordinance in the packet
reflects Option 1 with the meter rate change and the senior discount; if Council wants to
make changes we need to amendment the Ordinance.
Mayor Johnson stated that they will review the recommendations item by item.
Page 15 of 17
- Establish a Utility Advisory Board to look at rates throughout the year
All were in agreement that this needs to happen. Councilman Turned stated that we need
people who will commit to tenure, so we are not constantly having to reeducate.
- Establish a Finance Advisory Board
Council had differing opinions on this and agreed to study it more and determine the
parameters. They agreed to add to a future agenda for further discussion.
Mayor Johnson moved on to Option 3 stating that he sees it as being the more palpable one,
even with the rick factors. There was a lengthy discussion between Council and the Committee
concerning the pros and cons of this option.
Due to the length of the meeting Council agreed to recess the meeting until tomorrow, Tuesday,
September 20, 2016 at 7:30 p.m.
Motion To recess the meeting and to reconvene tomorrow, Tuesday, September 20, 2016 at
7:30 p.m. Action Meeting Recessed, Moved By Kelly Turner, Seconded By Liz Carrington.
Motion passed Unanimously
Meeting recessed at 11:25 p.m.
Mayor Johnson called the meeting to order and opened the regular session at 7:30 p.m.
Tuesday, September 20, 2016.
Present: Frank Fernandez, Brian Johnson , Kelly Turner, Liz Carrington, Charles Overstreet,
Michael Walker
Absent: None
City Manager Bob Hart, City Secretary Leslie Galloway, City Finance Director Krystal Crump,
Public Works Director Larry Ledbetter and Water Rate Review Committee Chair Ernest Harvey
were in attendance to answer questions that Council may have concerning the opinions
presented.
Mayor Brian Johnson provided a summary of where they left off at last night's meeting. He
stated that they agreed to establish a Utility Advisory Committee, but decided to have future
discussion regarding the Financial Advisory Committee. Council began discussions of the rate
options provided by the Water Rate Review Committee. There were lengthy discussions
concerning all the options presented, calculations, discounts, rate structure, budget shortfalls,
meter sizes, infrastructure repairs, risk factors, citizen concerns and community needs.
Motion To adopt Ordinance 611 approving water and sanitary sewer rates Option 3 as
recommended by the Water Rate Committee. Action Approve, Moved By Liz Carrington,
Seconded By Kelly Turner.
Motion passed with a vote of 4 -1; with Frank Fernandez voting against approval.
XII. EXECUTIVE SESSION
Mayor Johnson recessed into executive session at 9:13 p.m. on Tuesday, September 20, 2016
A. The City Council may meet in closed session at any time during the work session or the
regular session, pursuant to Section 551.071 of the Texas Government Code for consultation
with the City Attorney pertaining to any matter in which the duty of the City Attorney under the
Texas Disciplinary Rules of Professional Conduct may conflict with the Open Meetings Act,
including discussion on any item posted on the agenda.
Page 16 of 17
The City Council will meet in closed session pursuant to Section 551.072 of the Texas
Government Code to deliberate the purchase, exchange, lease, or value of real property for the
following:
1. 108 New Hope Road
2. 6727 Hudson Village Creek Road
3. 3575 W. Kennedale Parkway
XIII. RECONVENE INTO OPEN SESSION, AND TAKE ACTION NECESSARY PURSUANT TO
EXECUTIVE SESSION, IF NEEDED
Mayor Johnson reconvened into open session at 9:50 p.m.
A. Consider approval of Resolution 492 authorizing the City Attorney to bring a condemnation
action for the purpose of obtaining fee title of property to build a public street, or for other public
purposes permitted by law
There was no action taken on this item.
XIV. ADJOURNMENT
The meeting was adjourned at 9:52 p.m.
,--�
Brian Johnson, Mayor
ATTEST:
Leslie Galloway, City Secretary
Page 17 of 17