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2019_02.11 CC Packet - Special KENNEDALE CITY COUNCIL AGENDA SPECIAL MEETING | FEBRUARY 11, 2019 at 5:30 PM CITY HALL COUNCIL CHAMBERS, 405 MUNICIPAL DRIVE I. CALL TO ORDER NOTE: Pursuant to §551.071, Texas Government Code, City Council reserves the right to adjourn into Executive Session at any time during the Work Session or the Regular Session to discuss posted Executive Session items or to seek legal advice from the City Attorney on any item posted on the agenda. II. WORK SESSION A. Presentation by Andrew Friedman of SAMCO Capital Markets, the City’s financial advisor, regarding the authority of a City to issue various bonds and the considerations related to different types of indebtedness B. Receive a report and hold a discussion regarding the Citizen Charter Study Committee recommendations for possible charter amendments C. Discussion regarding proposed contracts to purchase potable water from the City of Arlington and to transfer the operation and maintenance of the Kennedale water and sewer systems to the City of Arlington III. EXECUTIVE SESSION 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 of any item posted on the agenda and legal issues regarding the Open Meetings Act. A. Discussion with the City Attorney regarding proposed contracts to purchase potable water from the City of Arlington and to transfer the operation and maintenance of the Kennedale water and sewer systems to the City of Arlington B. Discussion with the City Attorney regarding Resolutions of Support for applications to the Texas Department of Housing and Community Affairs (TDHCA) Housing Credit Program C. Discussion with the City Attorney regarding erosion along Winding Creek D. Discuss pending legal matters regarding Ron Sturgeon vs. City of Kennedale E. Discussion with the City Attorney regarding City funding for EDC property known as Block 1 Lot 1A2, Harris Corporation Addition IV. RECONVENE INTO OPEN SESSION, AND TAKE ACTION NECESSARY PURSUANT TO EXECUTIVE SESSION, IF NEEDED V. REGULAR SESSION VI. ROLL CALL VII. DECISION ITEMS A. Consider approval of Ordinance 658 calling a Charter Amendment Special Election for May 4, 2019 B. Discuss and consider Resolution 543, a Resolution of Support for an application to the Texas Department of Housing and Community Affairs (TDHCA) 2019 Housing Credit Program by OM Housing, LLC to partially finance the mixed-use development of The Village at Hammack Creek, located at the northeast corner of East Kennedale Parkway and Kennedale Sublett Road VIII. ADJOURNMENT In compliance with the Americans with Disabilities Act, the City of Kennedale will provide for reasonable accommodations for persons attending meetings. This facility is wheelchair accessible and accessible parking spaces are available. Requests for sign interpreter services must be made forty-eight (48) hours prior to the meeting. Please contact the City Secretary at 817-985-2104 or (TTY) 1-800-735-2989. CERTIFICATION I do hereby certify that a copy of the February 11, 2019 Kennedale City Council agenda was posted on the bulletin board next to the main entrance of City Hall (405 Municipal Drive; Kennedale, TX 76060), in a place convenient and readily accessible to the general public at all times; and that said agenda was posted at least seventy-two (72) hours preceding the scheduled time of said meeting, in accordance with Chapter 551 of the Texas Government Code. ___________________________ LESLIE GALLOWAY, CITY SECRETARY STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: WORK SESSION - A. I. Subject: Presentation by Andrew Friedman of SAMCO Capital Markets, the City’s financial advisor, regarding the authority of a City to issue various bonds and the considerations related to different types of indebtedness II. Originated by: Brady Olsen, Finance Director III. Summary: Andrew Friedman of SAMCO Capital Markets, the City’s financial advisor, made the attached presentation to the Charter Study Committee at their Thursday, January 3 meeting. Following tonight's presentation to Council, Mr. Friedman and Finance Director Brady Olsen will be available to answer questions. IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: 1.Kennedale Debt Discussion - SAMCO Kennedale Debt Discussion - SAMCO.pdf CITY OF KENNEDALE, TEXASCity Charter Committee Discussion onTypes of Municipal DebtJANUARY 3, 2019 2General Obligation Bonds•Authorized by a successful bond election or multiple bond elections for multiple projects•If voters turn down a bond election the City is prohibited from issuing COs for the same project for 2 years•Secured by ad valorem tax levy, but can be paid from other sources as well•Typically used for general improvements in the City (street improvements, municipal facilities, rolling stock,etc.)•NOT typically used to fund enterprise fund improvements (i.e. utility system improvements)•Bond Elections alone carry an added cost (renting election machines, legal fees for drafting electionordinance, etc.) typically around $15,000‐$30,000 regardless of election successTypes of Municipal Debt 3Revenue Bonds•No election required•Ad valorem taxes are not allowed in repayment of the Bonds•Often carry a higher cost of borrowing due to weaker security of the bonds (utility system revenues versusad valorem taxes)•Stricter bond covenants that can make revenue bonds much more difficult to issue requiring higher utilityrates as a result.•A typical covenant would require prior year’s netrevenues of 1.25X the average debt service of allutility system debt outstanding (including the issuance of the Bonds)•Debt Service Reserve Fund must be created and funded over the course of 60 months in an amountequal to the average annual debt service of the revenue bondsTypes of Municipal Debt 4Certificates of Obligation•No election required, but voters retain the right of referendum•City Council must adopt a Notice of Intent Resolutionand publish the notice in its paper of record for twoconsecutive weeks, so citizens are aware of the upcoming financing•Subject to petition by the registered voters of the City•If a petition is submitted with 5% of the qualified voters contesting the issuance of the COs then theissuance of COs is paused until a bond election can becalled and held. Only after a successful electioncould the COs be sold•Sale can only proceed once 30 days has elapsed since thepublication of the Notice and no valid petition hasbeen filed with the City•Ad valorem taxes and utility system revenues may be pledged in repayment of the Obligations depending onwhich fund supports the project•Allows the City to finance multiple projects with multiple sources of repayment together to createeconomies of scale and reduce issuance costsTypes of Municipal Debt 5Tax Notes•No election required•Not subject to referendum by the citizens•Maximum maturity of 7 years•Used primarily for financing assets with a shorter useful life•Quickest process to issue debt and have the funds deposited into the City’s accounts•Typically a cheaper borrowing alternative to Lease Purchase AgreementsTypes of Municipal Debt 6Pros and Cons of Requiring a Bond Election for All Debt IssuancesPros:•Voters have a direct say in each financing the City is consideringCons:•Costly for the City to hold bond elections for potential projects (especially for smaller projects)•Projects turned down at a bond election cannot be funded for two years•Long lead time to fund projectsTypes of Municipal Debt 7Pros and Cons of Certificates of ObligationPros:•Less costly than issuing general obligation bonds (no election cost)•Cheaper than issuing revenue bonds and less restrictive bond covenants•Quicker process than having a bond election and issuing GO Bonds•Fund multiple projects at one‐time•i.e. can fund general fund projects and utility system projects together rather than issue two separatebonds and incurring twice the costCons:•Less input from the voters•Voters are made aware of the City’s intention to sell debt and retain the right of referendum•Very low threshold (5% of qualified voters) to stop a CO issuance•Potential public perception that you are circumventing the voters•Elected officials are tasked with directing the City based upon their insight of the various issues facingthe cityTypes of Municipal Debt STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: WORK SESSION - B. I. Subject: Receive a report and hold a discussion regarding the Citizen Charter Study Committee recommendations for possible charter amendments II. Originated by: George Campbell, City Manager III. Summary: During their October 16, 2018 Regular Meeting, the City Council appointed a Charter Study Committee to review the City’s Home Rule Charter and to recommend to Council whether a special election to amend the Charter should be held. The Committee met six times, and a report of the resulting recommendations, which was approved by the Committee at their Wednesday, January 23 meeting, is attached. This is the same report that was distributed via email to the City Council on Tuesday, February 5, 2019. For the sake of brevity some items have not been duplicated in this packet: Appendix A (full text of the current Charter), Appendix B (excerpt from a TML publication), Ordinance 658 (attached to Decision Item A of this agenda), and the Committee meeting minutes (available at www.cityofkennedale.com/agendas). As mentioned, Decision Item A on this agenda is consideration of Ordinance 658, which was drafted by City Attorney Betsy Elam (with assistance from Tom Spurgeon of McCall, Parkhurst & Horton (the City's Bond Counsel) regarding Proposition B), and would call a Special Election for Saturday, May 4, 2019, submitting to voters those Charter amendments proposed by the Committee. As Council is aware, Charter elections must be held on one of the two uniform election dates, which for 2019 are Saturday, May 4, and Tuesday, November 5. In order for Charter amendment propositions to appear on the Saturday, May 4 ballot, a special election must be called via adoption of an Ordinance containing final ballot language no later than Friday, February 15. IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: 1.2019_02.05_Informal Staff Report to Council 2019_02.05_ISR_Charter Committee Report.pdf 2.Charter Study Committee Report to Council Pages from Charter Study Committee Report to Council_LG.pdf PAGE 1 CITY OF KENNEDALE | www.cityofkennedale.com INFORMAL STAFF REPORT to the Mayor and City Council DATE: Tuesday, February 5, 2019 SUBJECT: Charter Study Committee Report ORIGINATED BY: Leslie Galloway, City Secretary & Communications Coordinator Mayor and Council, The purpose of this report is to provide the Council with information regarding the discussions and resulting recommendations of the Charter Study Committee. Consideration of the adoption of Ordinance 658 will appear on the Monday, February 11 agenda.       As Council is aware, Charter elections must be held on one of the two uniform election dates, which for 2019 are Saturday, May 4, and Tuesday, November 5. In order for Charter amendment propositions to appear on the Saturday, May 4 ballot, a special election must be called via adoption of an Ordinance containing final ballot language no later than Friday, February 15. SHOULD YOU HAVE ANY QUESTIONS REGARDING THIS REPORT, PLEASE CONTACT CITY SECRETARY LESLIE GALLOWAY AT 817-985-2104 OR LGALLOWAY@CITYOFKENNEDALE.COM.                                                               NOT INCLUDED HERE; AVAILABLE AT cityofkennedale.com/charter NOT INCLUDED HERE; AVAILABLE AT tml.org/p/TexasHomeRuleCharters2010.pdf Section 11.04 Form of recall petition The recall petition mentioned above must be addressed to the city council of Kennedale, must distinctly and specifically point out the ground or grounds upon which such petition for removal is predicated. The petition must specifically state each ground with such certainty as to give the officer sought to be removed, notice of the matters and things with which he is charged The signature shall be verified by oath in the following form: State of Texas County of Tarrant _______ , being first duly sworn, on oath deposes and says that I am one of the signers of the above petition and that the statements made therein are true, and that each signature appearing thereto was made in my presence on the day and date it purports to have been made, and I do solemnly swear that the name is the genuine signature of the person whose name it purports to be. SWORN AND SUBSCIBED TO me this __ day of. ___ , 20 . Notary Public in and for The State of Texas Section 11.05 Various Papers Constituting Petition Within ten (10) days from the filing of such petition, the city secretary shall examine the same and ensure that the structure and format are proper to proceed to ascertain that the requisite number of qualified voters have signed the petition. If the petition is insufficient the city secretary will' return the petition with a certificate describing the problem and ten (10) days will be allowed for amendments or corrections. After acceptance of the petition by the Secretary in complete and proper form it wil be forwarded to the city council of Kennedale within 15 days to be considered at the next regular meeting of the city council. 2 Section 11.06 Public Hearing to be Held The officer whose removal is sought may, within 5 days after the petition has been presented to the city council, request that a public hearing be held to permit him to present facts pertinent to the charges specified in the recall petition. In this event, the city council shall order such public hearing to be held not less than 10 days nor more than twenty days after receiving such a request for a public hearing. Section 11.07 Election to be called If an officer whose removal is sought does not resign, the city council shall order an election and fix a date for holding such recall election to coincide with the next scheduled election. Section 11.08 Ballots in recall election Ballots used at recall elections shall conform to the following requirements: (A) With respect to each person whose removal is sought, the question shall be submitted: "Shall (name of person) be removed from the office of (name of office) by recall?" (B) Immediately below each such question there shall be printed the following words, one (1)tne other, in order indicated: ___ FOR the recall of (name of person) __ -"AGAINST the recall of (name of person) Section 11.09 Result of recall election If the majority of the votes cast at a recall election shall be against the recall of the person named on the ballot he shall continue in office for the remainder of his term. If a majority of the votes cast at such an election be for the recall of the person named on the ballot, he shall be deemed removed from office. The vacancy shall be filled as provided in section 3.06 of this charter Submitted for consideration of city charter review Bob Gruenhagen 11-16-18 3 RECALL SECTION 11.03 (Submitted by Charter Study Committee Member Gail Uranga January 2, 2019) ARTICLE V RECALL OF OFFICERS BY THE PEOPLE Section 5.01 Scope of Recall: All members of the City Council shall be subject to recall and removal from office by the qualified voters of the city. Section 5.02 Petitions for Recall: Before the question of recall of such officer shall be submitted to the qualified voters of the City, a petition demanding such question to be submitted, shall first be signed by the qualified voters of the City equal in number to at least thirty percent (30%) of the number of votes cast in the last regular municipal election of the City, and in no event less than five hundred (500) such petitioners. Each signer of such recall petition shall personally sign their name thereto in ink or indelible pencil, using their normal signature. In addition, each signer shall print their name, street address of their residence in Colleyville, voter registration certification number and the day, month and year that their signature was affixed to the recall petition. Section 5.03 Form of Recall Petition: The recall petition mentioned above must be addressed to the City Council of the City of Colleyville, must distinctly and specifically point out the ground or grounds upon which such petition for removal is predicated, and if there be more than one (1) ground, such as for incompetence, misconduct, or malfeasance in office, shall specifically state each ground with such certainty as to give the officer sought to be removed, notice of the matters and things with which he is charged. The signature shall be verified by oath in the following form: STATE OF TEXAS COUNTY OF TARRANT ______________, being first duly sworn, on oath deposes and says that I am one (1) of the signers of the above petition and that the statements made therein are true, and that each signature appearing thereto was made in my presence on the day and date it purports to have been made, and I solemnly swear that the same is the genuine signature of the person whose name it purports to be. _______________________________ SWORN AND SUBSCRIBED TO before me this ______ day of ___________, 20 __. _______________________________ Notary Public in and for The State of Texas. Section 5.04 Various Papers Constituting Petition: Within ten (10) days from the filing of such petition, the City Secretary shall examine the same and from the list of qualified voters ascertain whether or not said petition is signed by the requisite number of qualified voters, and, if necessary, the City Council shall allow him extra help for that purpose, and he shall attach to said petition a certificate showing the result of such examination. If by the City Secretary's certificate the petition is shown to be insufficient, it may be amended within ten (10) days from the date of said certificate. The City Secretary shall, within ten (10) days after such amendment is filed, in case one (1) is filed with him, make a like examination of said amended petition, and if his certificate shall show the same to be insufficient, it shall be returned to the person filing same without prejudice, however, to the filing of a new petition based upon new and different grounds, and not upon the same grounds. Section 5.05 Presentation of Petition to the City Council: Within fifteen (15) days after the date of filing of the papers constituting the recall petition, the person performing the duties of the City Secretary shall present such petition to the City Council of the City of Colleyville at a special meeting called for this purpose, or at the next regular meeting of the City Council. Section 5.06 Public Hearing to be Held: The officer whose removal is sought may, within five (5) days after such recall petition has been presented to the City Council, request that a public hearing be held to permit him to present facts pertinent to the charges specified in the recall petition. In this event, the City Council shall order such public hearing to be held not less than ten (10) days nor more than twenty (20) days after receiving such request for a public hearing. Section 5.07 Election to be Called: If an officer whose removal is sought does not resign, the City Council shall order an election and fix a date for holding such recall election within thirty (30) days of the date of the petition; provided, however, if an election cannot be called within said thirty (30) day period, then the date of the election shall be the first date an election may be called under State law. Section 5.08 Ballots in Recall Election: Ballots used at recall elections shall conform to the following requirements: (A) With respect to each person whose removal is sought, the question shall be submitted: "Shall (name of person) be removed from the office of (name of office) by recall?" (B) Immediately below each such question there shall be printed the following words, one (1) above the other, in the order indicated: ______FOR the recall of (name of person). ______AGAINST the recall of (name of person). Section 5.09 Result of Recall Election: If the majority of the votes cast at a recall election shall be against the recall of the person named on the ballot, he shall continue in office for the remainder of his unexpired term, subject to recall as specified in this Charter. If a majority of the votes cast at such election be for the recall of the person named on the ballot, he shall, regardless of any technical defects in the recall petition, be deemed removed from office and the vacancy shall be filled as provided in Section 3.05 of this Charter. Section 5.10 Recall, Restrictions Thereon: No recall petition shall be filed against any officer of the City within six (6) months after his election, nor within six (6) months after an election for such officer's recall. Nothing herein shall prevent impeachment of an officer of the City nor removal for other causes as provided for herein. Section 5.11 Failure of City Council to Call an Election: In case all of the requirements of this Charter shall have been met and the City Council shall fail or refuse to receive the recall petition, or order such recall election, or discharge other duties imposed upon said City Council by the provisions of this Charter with reference to such recall, then the County Judge of Tarrant County, Texas, may discharge any such duties herein provided to be discharged by the City Secretary or by the City Council. ORDINANCE 658 NOT INCLUDED HERE; ATTACHED TO DECISION ITEM A IN THIS PACKET --- CHARTER STUDY COMMITTEE MINUTES NOT INCLUDED HERE; AVAILABLE AT cityofkennedale.com/agendas STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: WORK SESSION - C. I. Subject: Discussion regarding proposed contracts to purchase potable water from the City of Arlington and to transfer the operation and maintenance of the Kennedale water and sewer systems to the City of Arlington II. Originated by: George Campbell, City Manager III. Summary: The Utility & Infrastructure Board (UIB) met on Tuesday, February 5, but postponed discussion of these contracts due to continuing negotiations. The Board intends to meet again to formulate a recommendation to the Council once terms have been finalized. The most current version of these two contracts (as of the publication of the packet on Friday, February 8) and the related Informal Staff Reports are included in the Confidential packet for Council's reference. Also attached is the original presentation regarding these contracts, which was made at the December 6, 2018 meeting. IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: 1.2018_12.06_Wholesale Water Contract Presentation 2018_12.06_Arlington Contract Presentation_2up.pdf 2.2019.01.11 Water Contracts_ISR_CONFIDENTIAL ISR_2019.01.11 Water Contracts_WM.pdf 3.2019.02.05 Water Contracts_ISR_CONFIDENTIAL ISR_2019.02.05 Water Contracts_WM.pdf 4.2018_11.29_Wholesale_Water_Contract_CONFIDENTIAL 2018_11.29_Wholesale_Water_Contract_CONFIDENTIAL.pdf 5.2018_12.06_OM Water Agreement- Arlington_CONFIDENTIAL 2018_12.06_OM Water Agreement- Arlington_CONFIDENTIAL.pdf Kennedale/Arlington Collaboration For Water Purchase and O&M Agreements December 6th, 2018 Special Meeting Successful Negotiations •Arlington has been an open and up front partner throughout the process •We truly believe this is a win for the citizens of Arlington and Kennedale •Arlington Team: Buzz Pishkur, Craig Cummings, Angelia Garrett, Brad Franklin, Craig Gantt •Kennedale Team: George Campbell, Brady Olsen, Wayne Olson, Tom Gooch 2 Cooperation Goals •Arlington will take responsibility for operation and maintenance of Kennedale Water and Wastewater System. •Kennedale will retain ownership of all utility assets in place at time of agreement. •Kennedale water and sewer rates will be reduced due to cost savings throughout the system. •Eligible Kennedale employees will be hired by Arlington and have access to wages and benefits currently available to similar employees. 3 Slide 14 Slide 17 Slide 29 Slide 16 Cooperation Goals •Kennedale will transition its water supply to Arlington to the fullest extent possible. •Arlington will honor all existing contractual obligations of Kennedale that cannot be eliminated by the change in operation responsibility. •The agreement will have a term which will allow the Cities to evaluate the viability of the collaboration. •The agreement will allow for termination and a transfer of all capital additions installed by Arlington to Kennedale. 4 Slide 18 Timeline •2017 –Began discussions with Arlington on possible interlocal agreement for operation of the Water and Sewer system •2018 –Meetings with Arlington Staff •November 2nd 2017, February 2nd, March 9th, April 27th, May 16th, May 23rd, July 9th, August 24th, October 31st, November 7th, November 30th –UIB •June 5th, November 29th –Council Action •May 30th—Authorized Freese and Nichols to evaluate technical aspects of contract –Discussed with Council throughout 2018 and 2019 budget discussions and regular meetings 5 Contract Highlights •Initial term of 5 years – renewable in 5-year increments. –After two years, renegotiate price based on actual costs •Annual non-routine maintenance and repair limit of $100,000 •$10,000 single maintenance expenditure limit without Kennedale approval. •Eligible Kennedale employees will be offered employment in same or similar positions, subject to successful results on all pre-employment screenings. 6 Contract Highlights •Kennedale retains ownership of all system assets. •Funding is provided in Arlington’s fee to construct an interconnect to deliver Arlington water to Kennedale & annual capital projects thereafter. •Arlington will propose an annual capital improvement plan to Kennedale. •Kennedale will grant Arlington transmission rights for water distribution at a set fee with a fee adjustment formula. •Kennedale should see a $600,000 savings in operating costs 7 Services Included •Arlington will maintain system to same standards of its own system. •Arlington will implement existing technology to the betterment of our system •Arlington will run and maintain wells while in use 8 Impact on Kennedale How We Got Here •Citizens and Council highly interested and motivated to reduce the water and sewer rates •City has previously delayed needed maintenance and capital improvements •Arlington has excess capacity and a desire to sell water •Both Cities committed to regional solutions to common issues and challenges in a dynamic, densely populated metropolitan area 10 Outside Studies •Kennedale has long underfunded capital and maintenance projects for the W&S system •Freese & Nichols Study –Identified $4.5 Million in short term needs •TRWA –Identified over $600,000 in annual maintenance needed to maintain system 11 Current System •As a cost savings measure, majority of water supply comes from existing wells. •Remaining water supply provided by Fort Worth •Wastewater treatment and transmission largely provided by Arlington, supplemented by Fort Worth •Contract with Fathom to manage utility billing •Budget 12.5 FTE to manage remaining operations 12 Impact of Arlington Contracts Operational Impact •Move off wells –Hopefully improved taste –Possible improved pressure •Improved technological resources –Line robots, mapping, vactor •Targeted repairs of W&S lines •In-house engineering and construction crews •Potentially difficult transition period 14 Direct Citizen Impact •Arlington and Kennedale citizens will be able to pay bills at multiple locations in either city –Still a presence in Kennedale City Hall •Citizens will report service issues directly to Arlington 15 Employee Impact •All eligible employees (6) being offered employment with Arlington –Will receive at least equal pay and benefits and retain retirement benefits through TMRS •Ineligible employees (2) being offered to stay during 2 month transition period •All employees being offered payment for sick days as if fully vested •No employees in Water and Sewer Fund after the end of February 16 Infrastructure •Kennedale will own all infrastructure •Within first months of transition, a full inventory will occur and Arlington will offer fair market price for assorted tools/equipment •Current fleet will be moved to other City departments per replacement schedule 17 Existing Contracts •Fort Worth- Sale of Water (2031) and Wastewater Services (2048) •Arlington- Wastewater Service •Fathom-Billing (2027) •Progressive Waste 18 Fort Worth Contract •Fort Worth was a good partner in this process •Agreed to review contract in case of conflict with current water purchase agreement •Agreed to a Memorandum of Understanding –Ensure neither Kennedale nor Arlington resells Ft Worth water –Adjust impact fees based on purchased water from Arlington 19 Fort Worth Water vs Arlington Water •Fort Worth formula based on rolling averages of maximum daily use, maximum hourly use, and total volume –Paying ~$2.62/ 1,000 gallons •Arlington rate of $2.32 / 1,000 gallons 20 Fathom •Currently budgeted to spend ~$220,000 per year for service •Contract ends in 2027 •Arlington believes it can absorb billing function with their current infrastructure •Fathom open to a buy-out 21 Costs Retained by Kennedale •Kennedale will retain ownership of existing infrastructure –Will need to pay to maintain existing service building •Engineering costs to review Arlington capital proposals •Debt Service •General property and liability insurance •Franchise Fee and City Return on Investment 22 Cost of Operations 23 Item Current Budget Year 1 Amended Budget Typical Year Arlington Contract Fathom Contract $223,856 $223,856 $223,856 Fort Worth Water $226,300 $226,300 $226,300 Arlington Sewer $696,000 $696,000 $696,000 Fort Worth Sewer $21,900 $21,900 $21,900 Return of Investment $355,518 $355,518 $355,518 Franchise Fee $190,658 $190,658 $190,658 Debt $509,680 $509,680 $509,680 Insurance $16,473 $16,473 $16,473 Building Maintenance/Other $49,181 $49,181 $49,181 Engineering $80,000 $80,000 $50,000 Emergency Exp/Reserve $150,000 Annual Capital $250,000 Purchase Water Arlington $500,000 One-Time Capital $635,000 $635,000 Other Kennedale Operating Costs $1,654,953 Arlington O&M Agreement $1,088,000 $788,000 Total $4,659,519 $4,092,566 $4,027,566 Financial Impact •~$600,000 savings in operations •~$200,000 net increase in purchased water •Additionally, able to fund reserve and continue capital spending 24 New Costs •~$200,000 to $300,000 net cost in purchased water •~$150,000 annual to fund emergency maintenance and fund reserve •~$250,000 annually in additional capital costs 25 Effect on Rates •Need ~$4.03 million in revenue to support ongoing expenditures •Current rates budgeted to bring in $4.01 million •Contract with Arlington allows us to support operating budget after the recent rate reduction 2626 Rate Recommendation •Move adopted rates in line with AWWA guidelines –Reduction in base rate for larger meters –Reduction in base rate for commercial customers –Slight increase in volume charge for high volume customers 27 Rate Recommendation Meter Size Residential Base Senior/Disabled Base* Commercial Base Industrial Base Multiple Res/Comm Base 3/4"$20.00 $20.00 $26.00 $26.00 $26.00 Per Unit 1"$43.34 $43.34 $43.34 $43.34 $26.00 Per Unit 1.5"$86.58 $86.58 $86.58 $86.58 $26.00 Per Unit 2"$138.58 $138.58 $138.58 $138.58 $26.00 Per Unit 3"$260.00 $260.00 $260.00 $260.00 $26.00 Per Unit 4"$433.42 $433.42 $433.42 $433.42 $26.00 Per Unit Volume Residential Rate Senior/Disabled Rate Commercial Rate Commercial Rate Multiple Res/Comm Rate** 0-5000 Gallons $2.75 Per 1000 Gallons $2.75 Per 1000 Gallons $2.75 Per 1000 Gallons $2.75 Per 1000 Gallons N/A 5001-20000 $5.36 Per 1000 Gallons $5.36 Per 1000 Gallons $5.36 Per 1000 Gallons $5.36 Per 1000 Gallons N/A 20001-50000 $6.70 Per 1000 Gallons $6.70 Per 1000 Gallons $6.70 Per 1000 Gallons $6.70 Per 1000 Gallons N/A 50001+$6.70 Per 1000 Gallons $6.70 Per 1000 Gallons $8.38 Per 1000 Gallons $8.38 Per 1000 Gallons N/A Residential Senior/Disabled Commercial Industrial Base Multiple Res/Comm Base $30.00 $30.00*$55.00 $55.00 N/A Per 1000 Gallons $2.90 $2.90 $6.72 $4.50 N/A City of Kennedale Water & Sewer Rates (ADOPTED SEPTEMBER 17, 2018) Water Rates Service Within The City Limits *For senior/disabled rate, a credit of $7.50 per month/billing cycle will apply towards the applicable meter size for water service. **For multiple residential units on a single meter, the volume charge shall be calculated on a per unit basis by dividing the total volume of water used by the number Service Within The City Limits *For senior/disabled rate, a credit of $7.50 per month/billing cycle will apply towards the applicable base for sewer service. Sewer Rates 28 Rate Recommendation Meter Size Residential Base Senior/Disabled Base* Commercial Base Industrial Base Multiple Res/Comm Base 3/4"$20.00 $20.00 $25.00 $25.00 $26.00 Per Unit 1"$33.40 $33.40 $41.75 $41.75 $26.00 Per Unit 1.5"$66.60 $66.60 $83.25 $83.25 $26.00 Per Unit 2"$106.60 $106.60 $133.25 $133.25 $26.00 Per Unit 3"$200.00 $200.00 $250.00 $250.00 $26.00 Per Unit 4"$333.40 $333.40 $416.75 $416.75 $26.00 Per Unit Volume Residential Rate Senior/Disabled Rate Commercial Rate Commercial Rate Multiple Res/Comm Rate** 0-5000 Gallons $2.50 Per 1000 Gallons $2.50 Per 1000 Gallons $2.50 Per 1000 Gallons $2.50 Per 1000 Gallons N/A 5001-20000 $5.50 Per 1000 Gallons $5.50 Per 1000 Gallons $5.50 Per 1000 Gallons $5.50 Per 1000 Gallons N/A 20001-50000 $7.00 Per 1000 Gallons $7.00 Per 1000 Gallons $7.00 Per 1000 Gallons $7.00 Per 1000 Gallons N/A 50001+$7.00 Per 1000 Gallons $7.00 Per 1000 Gallons $8.50 Per 1000 Gallons $8.50 Per 1000 Gallons N/A Residential Senior/Disabled Commercial Industrial Base Multiple Res/Comm Base $30.00 $30.00*$55.00 $55.00 N/A Per 1000 Gallons $2.90 $2.90 $6.50 $4.50 N/A Service Within The City Limits *For senior/disabled rate, a credit of $7.50 per month/billing cycle will apply towards the applicable base for sewer service. Sewer Rates City of Kennedale Water & Sewer Rates (PROPOSED) Water Rates Service Within The City Limits *For senior/disabled rate, a credit of $7.50 per month/billing cycle will apply towards the applicable meter size for water service. **For multiple residential units on a single meter, the volume charge shall be calculated on a per unit basis by dividing the total volume of water used by the number 29 Citizen Impact 30 Customer Profile #1 Residential-3/4" 3/4" meter ResidentialCustomer, using 6500 gallons of water and 4700 gallons of Sewer p Rate Year Water Bill if used: Sewer Bill if used: Total Bill Overall Chg Month Year 6500 4700 July 2013 $35.73 $36.41 $72.14 Jan 2016 $52.53 $58.63 $111.16 54.09% Sept 2017 $48.29 $49.63 $97.92 -11.91% Sept 2018 $41.79 $43.63 $85.42 -12.77% Proposed $40.75 $43.63 $84.38 -1.22% Customer Profile #2 Residential-1" 1" meter ResidentialCustomer, using 8000 gallons of water and 6000 gallons of Sewer pe Rate Year Water Bill if used: Sewer Bill if used: Total Bill Overall Chg Month Year 8000 6000 July 2013 $45.49 $41.73 $87.22 Jan 2016 $112.30 $62.40 $174.70 100.30% Sept 2017 $95.33 $53.40 $148.73 -14.87% Sept 2018 $73.17 $47.40 $120.57 -18.93% Proposed $62.40 $47.40 $109.80 -8.93% Citizen Impact 31 Customer Profile #3 Residential-3/4" 3/4" meter Residential Customer, using 15000 gallons of water and 11000 gallons of Sew Rate Year Water Bill if used: Sewer Bill if used: Total Bill Overall Chg Month Year 15000 11000 July 2013 $80.52 $62.18 $142.70 Jan 2016 $98.00 $76.90 $174.90 22.56% Sept 2017 $93.35 $76.90 $170.25 -2.66% Sept 2018 $87.35 $61.90 $149.25 -12.33% Proposed $87.50 $61.90 $149.40 0.10% Customer Profile #4 Residential-1" 1" Residential Customer, using 45,000 gallons of water and 30,000 gallons of Sewer per m Rate Year Water Bill if used: Sewer Bill if used: Total Bill Overall Chg Month Year 45,000 30,000 July 2013 $247.92 $139.89 $387.81 Jan 2016 $335.75 $132.00 $467.75 20.61% Sept 2017 $326.65 $132.00 $458.65 -1.95% Sept 2018 $304.99 $117.00 $421.99 -7.99% Proposed $303.40 $117.00 $420.40 -0.38% Special Thanks •Buzz Pishkur and the City of Arlington •Chris Harder with City of Fort Worth •Wayne Olson •Tom Gooch of Freese and Nichols •Current Public Works staff 32 STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: EXECUTIVE SESSION - A. I. Subject: Discussion with the City Attorney regarding proposed contracts to purchase potable water from the City of Arlington and to transfer the operation and maintenance of the Kennedale water and sewer systems to the City of Arlington II. Originated by: III. Summary: IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: EXECUTIVE SESSION - B. I. Subject: Discussion with the City Attorney regarding Resolutions of Support for applications to the Texas Department of Housing and Community Affairs (TDHCA) Housing Credit Program II. Originated by: III. Summary: IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: EXECUTIVE SESSION - C. I. Subject: Discussion with the City Attorney regarding erosion along Winding Creek II. Originated by: III. Summary: IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: EXECUTIVE SESSION - D. I. Subject: Discuss pending legal matters regarding Ron Sturgeon vs. City of Kennedale II. Originated by: III. Summary: IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: EXECUTIVE SESSION - E. I. Subject: Discussion with the City Attorney regarding City funding for EDC property known as Block 1 Lot 1A2, Harris Corporation Addition II. Originated by: III. Summary: IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: DECISION ITEMS - A. I. Subject: Consider approval of Ordinance 658 calling a Charter Amendment Special Election for May 4, 2019 II. Originated by: George Campbell, City Manager III. Summary: At their Regular Meeting on October 16, 2018, the City Council appointed a Charter Study Committee to review the City’s Home Rule Charter: • Mayor Brian Johnson, Chair (nominated by the Council) • Bob Gruenhagen, Vice Chair (nominated by Councilmember Gilley) • Gail Uranga (nominated by Councilmember Joplin) • Robert Mundy (nominated by Councilmember Pugh) • Kenneth Michels (nominated by Councilmember Rhodes) • John Clark (nominated by Mayor Johnson) • Cheryl Pond (nominated by Mayor Pro Tem Lee) The Committee's recommendations have been reviewed by City Attorney Betsy Elam and formatted into Ordinance 658, calling for a Special Election on Saturday, May 4, 2019. As Council is aware, Charter elections must be held on one of the two uniform election dates, which for 2019 are Saturday, May 4, and Tuesday, November 5. In order for Charter amendment propositions to appear on the Saturday, May 4 ballot, a special election must be called via adoption of an Ordinance containing final ballot language no later than Friday, February 15. IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: VII. Alternative Actions: VIII. Attachments: 1.O658_Charter Election Ordinance_TOASE O658_Special Charter Election _ TOASE.pdf INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 1 OF 26 O658 CITY OF KENNEDALE, TX 2019 ORDINANCE NO. 658 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF KENNEDALE, TEXAS, CALLING FOR A SPECIAL ELECTION TO BE HELD ON MAY 4, 2019, FOR THE PURPOSE OF SUBMITTING TO THE VOTERS PROPOSED AMENDMENTS TO THE CHARTER; APPROVING A JOINT ELECTION WITH TARRANT COUNTY; AND ESTABLISHING PROCEDURES FOR THAT ELECTION; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Kennedale, Texas, (the “City”) is a home rule city acting under its charter adopted by the electorate pursuant to Article XI, Section 5 of the Texas Constitution and Chapter 9 of the Local Government Code; and WHEREAS, it is the intention of the City Council to call a special election to submit proposed amendments to the City Charter to the voters in accordance with Section 9.004 of the Texas Local Government Code; and WHEREAS, an election to submit to the voters proposed amendments to the city charter is required by law to be held on the uniform election date that occurs 30 days after the election is ordered and Section 3.005 of the Texas Election Code requires that a special election be ordered prior to February 15, 2019; and WHEREAS, Section 41.001 of the Texas Election Code specifies that the May 4, 2019 is a uniform election date. WHEREAS, the election will be held as a joint election, conducted under the authority of Chapter 271 of the Texas Election Code (the “Code”); and WHEREAS, by this Ordinance, it is the intention of the City Council to designate a polling place for the election, to appoint the necessary election officers, to establish and set forth procedures for conducting the election. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF KENNEDALE, TEXAS: SECTION 1. SPECIAL ELECTION CALLED. The City Council does hereby, on its own motion, order a special election to submit to the voters of the City of Kennedale proposed amendments to the City Charter. The proposed amendments to the City Charter are set forth in Exhibit "A," attached to this ordinance and incorporated herein for all purposes and are hereby approved by the City Council for submission to the voters. The election shall be conducted according to the laws of the State of Texas, and shall be held on Saturday, May 4, 2019 from 7:00 a.m. to 7:00 p.m. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 2 OF 26 O658 CITY OF KENNEDALE, TX 2019 SECTION 2. BALLOTS. The official ballots for said election shall be prepared in accordance with the Texas Election Code so as to permit the electors to vote "YES" or "NO" on each proposition, with the ballots to contain such provisions, markings and language as required by law, and with the propositions to be expressed substantially as set forth as follows: PROPOSITION A – Vacancies for Three Year Terms Shall the Kennedale Home Rule Charter be amended to delete Section 3.06(a)(1) regarding filling vacancies for three (3) year terms as unnecessary, because the charter only provides for two (2) year terms? PROPOSITION B – Indebtedness Shall the Kennedale Home Rule Charter be amended to revise Section 6.05 regarding the issuance of indebtedness by retaining the first sentence thereof (which authorizes the City to issue all forms of indebtedness permitted by state law), retaining the existing additional authority to enter into short term borrowings (less than one year), and deleting all other provisions thereof since they are otherwise provided by state law? PROPOSITION C – Initiative, Referendum and Recall Shall the Kennedale Home Rule Charter be amended to revise Article XI by increasing the signature requirements for initiative, referendum and recall to thirty percent (30%) of the votes cast in the last regular election but not less than five hundred (500) by amending Section 11.01; and to allow for a public hearing prior to calling a recall election by amending Section 11.03? SECTION 3. EARLY VOTING. a. Early voting by personal appearance. Early voting by personal appearance shall be conducted beginning April 22, 2019, and continue through April 30, 2019, at the Kennedale Community Center, 316 W. 3rd Street, Kennedale, Texas 76060 at the following times: MONDAY, APRIL 22, 2019 8:00 A.M. – 5:00 P.M. TUESDAY, APRIL 23, 2019 8:00 A.M. – 5:00 P.M. WEDNESDAY, APRIL 24, 2019 8:00 A.M. – 5:00 P.M. THURSDAY, APRIL 25, 2019 8:00 A.M. – 5:00 P.M. FRIDAY, APRIL 26, 2019 8:00 A.M. – 5:00 P.M. SATURDAY, APRIL 27, 2019 7:00 A.M. – 7:00 P.M. SUNDAY, APRIL 28, 2019 11:00 A.M. – 4:00 P.M. MONDAY, APRIL 29, 2019 7:00 A.M. – 7:00 P.M. TUESDAY, APRIL 30, 2019 7:00 A.M. – 7:00 P.M. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 3 OF 26 O658 CITY OF KENNEDALE, TX 2019 Branch offices for early voting by personal appearance shall also be established as outlined in the Joint Election Agreement with Tarrant County. b. Early Voting by Mail. Heider Garcia, the Tarrant County Elections Administrator, or his successor, acting pursuant to Texas Government Code §601.002 (“Election Administrator”), is hereby designated as Early Voting Clerk for the election. Applications for early voting by mail may be delivered not later than the close of business on April 23, 2019 to the Election Administrator in any of the following ways: via mail to Early Voting Clerk, P.O. Box 961011, Fort Worth, Texas 76161-0011; via courier or hand delivery to Tarrant County Elections, 2700 Premier St., Fort Worth, Texas 76111-3011; via fax to 817-831-6118; or via email to votebymail@tarrantcounty.com. c. Early Voting Ballot Board. Early voting, both by personal appearance and by mail, shall be canvassed by the Early Voting Ballot Board established by Tarrant County under the terms of the Agreement. SECTION 4. APPOINTMENT OF ELECTION JUDGE AND ALTERNATE ELECTION JUDGE. The Presiding Election Judge and Alternate Presiding Judge shall be appointed by Tarrant County as authorized by Chapter 271 of the Code. SECTION 5. METHOD OF VOTING; COSTS. The Joint Election Agreement shall provide (a) the type of electronic voting equipment to be used for early voting by personal appearance and on election day, (b) notification and training for election judges and clerks, (c) an estimate and final payment terms for the election services provided, (d) agreements for early voting equipment and voting machine rental, and (e) other procedures to conduct the election. All expenditures necessary for the conduct of the election, the purchase of materials therefor, and the employment of all election officials are hereby authorized, and shall be conducted in accordance with the Code. SECTION 6. GOVERNING LAW AND QUALIFIED VOTERS. The election shall be held in accordance with the Constitution of the State of Texas and the Code, and all resident qualified voters of the City shall be eligible to vote at the election. SECTION 7. PUBLICATION AND POSTING OF NOTICE OF ELECTION. Notice of the election shall be given as required by Chapter 4 of the Code, and additionally, a substantial copy of the proposed amendments shall be published on the same day twice in each of two successful weeks, with the first publication occurring INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 4 OF 26 O658 CITY OF KENNEDALE, TX 2019 before the 14th day of the election in conformance with Section 9.004(c) of the Texas Local Government Code. SECTION 8. NECESSARY ACTIONS. The Mayor and the City Secretary, in consultation with the City Attorney, are hereby authorized and directed to take any and all actions necessary to comply with the provisions of federal and state law in carrying out and conducting the election, whether or not expressly authorized herein. SECTION 9. EFFECTIVE DATE. This resolution shall be effective upon its adoption. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF KENNEDALE, TEXAS, THE 11TH DAY OF FEBRUARY, 2019. APPROVED: ______________________________ MAYOR, BRIAN JOHNSON [ C I T Y S E A L ] ATTEST: ______________________________ CITY SECRETARY, LESLIE GALLOWAY APPROVED AS TO FORM AND LEGALITY: ______________________________ CITY ATTORNEY INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 5 OF 26 O658 CITY OF KENNEDALE, TX 2019 ORDINANCE NO. 658 EXHIBIT A: “2019 CHARTER CHART” (21 pages) Proposed Changes (Redlined) Appear On:  Page 8: Section 3.06 - Vacancies and Forfeiture of Office  Pages 15-16: Section 6.05 - Indebtedness  Page 21: Section 11.01 - Initiative  Page 22: Section 11.03 - Recall INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 6 OF 26 O658 CITY OF KENNEDALE, TX 2019 2019 PROPOSED CHARTER ARTICLE I - FORM OF GOVERNMENT AND BOUNDARIES Section 1.01 - Incorporation The citizens of the City of Kennedale, Tarrant County, Texas, do hereby declare that the City of Kennedale is incorporated as a political subdivision of the State of Texas under the name of "City of Kennedale", hereinafter referred to as the 'City', and with the duties, rights, powers, authority, privileges, obligations, and immunities provided in this Charter. Section 1.02 - Form of Government The City government shall be a "Council-Manager Government". Pursuant to the provisions of and subject only to the limitations imposed by this Charter and by the state constitution and statutes, the City Council, led by the Mayor, shall be vested with all the powers of the City. The City Council shall enact legislation, adopt budgets, determine policies and appoint the City Manager. The City Manager shall execute the laws and administer the government of the City. The Mayor is responsible for vigilantly reviewing governmental activities, providin g leadership and making recommendations to the Council and City Manager that ensure that the city government is meeting the needs of the citizens of the City of Kennedale. Section 1.03 - Boundaries The boundaries of the City shall be as they exist when this Charter is adopted and shall remain in effect until changed. Section 1.04 - Change of Boundaries The City Council may, by ordinance, annex territory to the City. The City Council may, by ordinance, disannex territory within the City, and/or exchange territory with other cities and towns. These actions are subject only to state law. In accordance with state law, the people who reside in annexed territory shall be entitled to all the rights and privileges of citizens of the City, and shall be bound by the acts, ordinances, resolutions, and regulations of the City. ARTICLE II - RIGHTS AND POWERS OF THE CITY Section 2.01 - General The City shall have the rights and powers granted to municipalities and cities under the general laws, and the rights and powers of self-government that now exist or may hereafter be granted to Home Rule Cities by the Constitution and the general and special laws of the State of Texas, together with all the rights and powers so granted as fully and completely as th ough they were enumerated in this Charter. Such rights and powers, whether expressed or implied, shall be exercised and enforced in the manner prescribed by applicable State Law or by this Charter, and when not prescribed herein, in such manner as shall be provided by ordinance or resolution of the City Council. Section 2.02 - Construction and Severability The rights and powers of the City under this Charter shall be construed in favor of the City in the event of conflict between the City and other governmental agencies or bodies, corporations, or individuals, and the specific mention of particular rights or powers in this Charter shall not be construed as limiting in any way the general rights and powers stated in this Article. In addition, INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 7 OF 26 O658 CITY OF KENNEDALE, TX 2019 should any phrase, clause, sentence, or provision of this Charter be declared invalid by a court of competent jurisdiction, the validity and applicability of the remainder of this Charter shall not be affected. Section 2.03 - Intergovernmental Relations The City may exercise any of its rights or powers or perform any of its functions, and may participate in the financing thereof, either jointly or in cooperation, by contract or otherwise, with any one or more of the States or any political subdivisions or agencies thereof, or with the United States or any agency thereof. Section 2.04 - Transfer of Rights, Powers, and Obligations (a) The City shall succeed to all rights, claims, actions, orders, contracts, and legal or administrative proceedings pending or in process at the effective date of this Charter, except as modified pursuant to the provisions herein; and each matter shall be maintained, carried on, or dealt with by the City authority as appropriate under this Charter. (b) All City ordinances, resolutions, orders, and regulations in force on the date this Charter becomes fully effective are repealed to the extent that they are inconsistent or interfere with the operation of this Charter or of ordinances or resolutions adopted pursuant hereto. To the extent that the Constitution and laws of the State of Texas permit, all laws governing this City or its agencies, officers, or employees at the time this Charter becomes fully effective are superseded and void to the extent that they are inconsistent or interfere with the operation of this Charter or of ordinances or resolutions adopted pursuant hereto. ARTICLE III - THE CITY COUNCIL Section 3.01 - City Government The governing body of the City shall be known as the "City Council of the City of Kennedale", hereinafter referred to as the "City Council". The City Council shall be composed of a Mayor and five (5) other Council members. Section 3.02 - Expense Reimbursement Each member of the City Council shall receive reimbursement for each scheduled City Council meeting duly attended. In addition to the above, the City shall, upon receiving receipts and other appropriate documentation for authorized expenditures, reimburse the members of the City Council for necessary expenses incurred by them in the performance of their official duties. Section 3.03 - Mayor and Mayor Pro Tem The Mayor shall preside at City Council meetings, and shall be recognized as head of the City government. The Mayor shall have the right to vote only in the event of a tie. The Mayor shall also have veto power. The City Council shall elect one of its members Mayor Pro Tem. The Mayor Pro Tem shall act as Mayor in the absence of the Mayor and shall have the same duties and power as the Mayor except veto power. The Mayor Pro Tem shall retain the right to vote as a Council member. The Mayor may exercise veto power over a Council action within five (5) working days of that action. The Mayor shall give written notice of a veto to the City Secretary. Upon proper notice, Council action to consider overriding a veto shall be an agenda item at the next scheduled Council meeting. The decision of the Council to override a veto is not subject to veto by the Mayor and becomes effective immediately. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 8 OF 26 O658 CITY OF KENNEDALE, TX 2019 Section 3.04 - General Duties and Powers By this Charter, all powers of the City shall be vested in the City Council. The City Council shall exercise these powers to ensure the performance of all duties and obligations imposed on the City by law and by this Charter. Specifically, the City Council is provided with, but not limited to, the following powers: (a) To enact municipal legislation. (b) To appoint or elect and to remove, after a hearing, all persons appointed or elected by the City Council. (c) To establish the compensation for all City officers. (d) To create, change, or abolish all offices, departments, and agencies of the City government other than those offices and agencies created by this Charter; and to assign additional duties and powers consistent with this Charter to officers, departments, and agencies created by this Charter. (e) To establish operating policy. (f) To establish the boundaries of the City. Section 3.05 - Prohibitions (a) Holding Other Office. Except where authorized by law, no member of the City Council shall hold any other City office or employment with the City, excluding boards, committees and commissions, during the term for which the Council member was elected to the City Council. No former member of the City Council shall hold any compensated appointed City office or employment with the City for a period of two years after the expiration of the term of office. (b) Appointments and Removals. Neither the City Council nor any of its members shall, in any manner, dictate the appointment or removal of any City administrative officer or employee whom the City Manager or any of his subordinates are empowered to appoint. The City Council may, however, express its views fully and freely, discussing with the City Manager anything pertaining to the appointment and removal of such officers and employees. (c) Interference in Administrative Matters. Except for the purpose of inquiry or investigation, the City Council shall deal with administrative departments and the personnel of these departments solely through the City Manager. Neither the City Council nor any of its members shall give an order, either publicly or privately, to any subordinate of the City Manager. Section 3.06 - Vacancies and Forfeiture of Office (a) Vacancies. The office of a Council member or Mayor shall become vacant upon the death, resignation, forfeiture of office, or removal from office in any manner authorized by law or by this Charter. (1) Reserved. Vacancies on the City Council for offices with three year terms shall be filled as provided in this subsection. If a vacancy occurs in the office of the Mayor at a time when there remains an unexpired term of twelve (12) months or less, it shall be filled by the Mayor Pro Tem. If a vacancy occurs in any other City Council position at a time when there remains an unexpired term of twelve (12) months or less, including a position if vacated by the Mayor Pro Tem, itshall be filled by appointment by a majority vote of all of the remaining Council members. If a vacancy occurs in the office of the Mayor or any City Council position at a time when more than twelve (12) months remains on the unexpired term, it shall be filled by a majority vote of the qualified voters at a special election called for such purpose within one hundred twenty (120) days. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 9 OF 26 O658 CITY OF KENNEDALE, TX 2019 (2) Vacancies on the City Council for offices with two year terms shall be filled as provided in this subsection. The City Council may call a special election or by a majority vote of all remaining Council Members appoint a qualified person to fill the vacancy. (b) Forfeiture of Office. A Council member shall forfeit office if the member: (1) Lacks at any time during the term of office any qualification for the office prescribed by law or by this Charter; (2) Violates any express prohibition of this Charter; (3) Is convicted of a felony or any offense involving moral turpitude while in office; or (4) Fails to attend three (3) consecutive scheduled meetings without valid excuse, or fails to maintain an eighty (80) percent attendance record, excluding excused absences, for each elected year (including all scheduled budget and special meetings). (c) Declaration. Upon finding the occurrence of a condition of forfeiture, the Council must declare a vacancy at its next regular meeting and shall fill the vacancy as set forth in this Charter. (d) Qualifications. The Council shall be the judge of the qualifications of its members and for these purposes shall have the power to subpoena witnesses and require the production of records, but the decision of the Council in any case shall be subject to review by the courts. Section 3.07 - Investigations The City Council may investigate the affairs of the City and the official conduct of any City department, office, or agency. For this purpose, the City Council may subpoena witnesses, administer oaths, take testimony, and compel the production of all pertinent evidence. Any person who fails or refuses to obey a lawful order issued by the City Council shall be guilty of a misdemeanor, as provided by ordinance. Section 3.08 - Meeting Procedure (a) Meeting. The City Council shall meet in regularly scheduled City Council meetings at least once each month at such times as the members may prescribe by rule. Special meetings may be called on the request of the Mayor or three (3) City Council members. All City Council meetings shall be held at City Hall or at such place in the City that will permit the attendance of the general public. All City Council meetings and all sessions of the City Council and committees of the City Council shall be open to the public; however, the City Council may recess for the purpose of discussing in a closed or executive session those matters permitted by State Law, including, but not limited to: (1) Pending or contemplated litigation, settlement offers, and any other legal advice. (2) The acquisition or disposal of real property. (3) Personnel matters. (4) The evaluation of candidates for offices appointed by the City Council. (b) A motion calling for a closed or executive session must be made in a public meeting and must state the general subject to be discussed. No final action or vote with regard to any matter considered in a closed meeting shall be made except in a public meeting. (c) Rules and Minutes. The City Council shall determine its own rules and order of business, and shall provide for keeping minutes of all its proceedings. The minutes shall be a public record. The record of votes shall be recorded in the minutes of the City Council. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 10 OF 26 O658 CITY OF KENNEDALE, TX 2019 (d) Quorum. Three (3) members of the City Council shall constitute a quorum. The Mayor's presence shall not be counted for determining a quorum. Section 3.09 - Ordinances (a) An ordinance must be adopted by majority vote of the City Council to accomplish any of the following acts: (1) Adopt or amend an administrative code or establish, alter, or abolish any City department, office, or agency. (2) Provide for a fine or other penalty, or establish a rule or regulation for violation of which a fine or other penalty is imposed. (3) Levy taxes. (4) Grant, renew, or extend a franchise. (5) Regulate the rate charged for its services by a public utility. (6) Authorize the borrowing of money. (7) Convey, lease, or authorize the conveyance or lease of any lands of the City. (8) Adopt without amendment ordinances proposed under the initiative power. (9) Amend or repeal any ordinance previously adopted, except as otherwise provided in this Charter with respect to repeal of ordinances reconsidered under the referendum power. (10) Set fees, rates and charges. (b) Acts other than those referred to in (1) through (10) above may be accomplished by ordinance, resolution, or vote of the Council unless law or specific provision of this Charter requires that they be enacted by ordinance. Section 3.10 - Procedure for Enactment of Ordinances (a) Each proposed ordinance shall be introduced in written or printed form, and the enacting clause of all ordinances shall be "BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF KENNEDALE", but such enacting clause may be omitted when the ordinances of the City are codified and published in book or pamphlet form by the City of Kennedale. All ordinances, resolutions or orders may be passed at any regular meeting or at any special meeting called for that purpose. Prior notification of all meetings shall be made to the public and the press in accordance with the requirements of State law. (b) Proposed ordinances shall be published in the official medium as provided by State Law. All such ordinances may be admitted and received in all courts, subject to the rules of evidence and laws of jurisdictions where proof of such ordinances is tendered, without further proof. All meetings and ordinances shall be governed in strict accordance with State Law. Section 3.11 - Authentication, Recording, Codification, and Printing (a) Authentication and Recording. The City Secretary shall record in full, all ordinances and resolutions adopted by the City Council. This record shall be authenticated by the signature of the City Secretary. (b) Codification. The City Council shall provide for the preparation of a general codification of all City ordinances and resolutions having the force and effect of law. The general codification shall be adopted by the City Council by ordinance, and shall be published promptly in bound or loose-leaf form with this Charter and any laws of the State of Texas and such codes or technical INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 11 OF 26 O658 CITY OF KENNEDALE, TX 2019 regulations and other rules and regulations as the City Council may specify. This compilation shall be known and cited officially as the "City Code of Kennedale, Texas". Copies of the code shall be furnished to city officers, placed in public places for free public reference, and made available for purchase by the public at a price determined by the City Council to be sufficient to cover costs. ARTICLE IV - MUNICIPAL ELECTIONS Section 4.01 - City Council Places and Terms (a) The City Council shall be divided into the Mayor and places 1, 2, 3, 4, and 5. Each position shall be filled by a qualified citizen from the City at large by a majority vote cast by qualified voters. (b) Each place shall be for a two year term. The Mayor and Council members for places 2 and 4 shall be elected in even numbered years. Council members for places 1, 3, and 5 shall be elected in odd numbered years. Section 4.02 - Annual Elections (a) All general and special elections shall be held in accordance with the laws of the State of Texas regulating the holding of municipal elections and in accordance with this Charter and ordinances or resolutions adopted by the Council for the conduct of elections. The Council shall appoint the election judges and other election officials and shall provide for the compensation of all election officials in the City elections and for all other expenses in holding said elections. The election judges shall make provisions for the recount of ballots in case of doubt or fraud. They shall also be authorized to prevent unlawful practices such as electioneering or loitering near voting places. (b) Sample ballots identical to the voting format for the election shall be posted in the voting place for the benefit of the voters. Section 4.03 - Political Activities (a) No employee of the City may campaign for or against any issue while serving in his/her official capacity; nor influence the nomination, election, or defeat of any candidate for Mayor or Council member; or campaign for or against the recall of the Mayor or Council member. This provision shall not prohibit the ordinary exercise of the right to express opinions and to vote. (b) No candidate for municipal office may solicit the support, the endorsement, or the financial contributions of any City employee. Section 4.04 - Qualifications for Candidacy and Holding Office (a) Each member of the City Council, including the Mayor, shall meet the following qualifications: (1) Be a registered voter of the City; (2) Have resided in the City for one (1) year before the date of election; (3) Continue residency in the City during the term of office; (4) Not hold more than one public elective office; (5) Not hold an appointed office of the City excluding boards, committees, and commissions; (6) Be at least 21 years of age; (7) Not have been determined mentally incompetent by a final judgment of a court; and (8) Not have been finally convicted of a felony from which the person has not been pardoned or otherwise released from the resulting disabilities. (b) No candidate may file for more than one office or position number per election. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 12 OF 26 O658 CITY OF KENNEDALE, TX 2019 Section 4.05 - Canvassing of Elections and Declaration of Results Returns of every municipal election shall be delivered forthwith by the election judges to the City Secretary with a copy of the returns being sent to the Mayor. The Council shall canvass the returns, investigate the qualifications of the candidates and declare the official results of the election prior to the first regular Council meeting following delivery of the votes to the City Secretary all in accordance with the Texas Election Code. The results of every municipal election shall be recorded in the minutes of the Council. The qualified person receiving a majority of the votes cast for any office shall thereupon be declared elected by the said Council. The decision of the Council, as to qualification of candidates, shall be conclusive and final for all purposes. If a run-off election is necessary, it shall be scheduled in accordance with State Law. ARTICLE V - MUNICIPAL ADMINISTRATION Section 5.01 - City Manager The City Council shall appoint a City Manager by an affirmative vote of not less than four (4) members of the Council. The City Council shall by majority vote determine and fix the City Manager's compensation. The City Manager shall be chosen solely upon the basis of executive and administrative training, experience, and abilities, without regard to political considerations. Neither the Mayor nor any Council member may be appointed City Manager or acting City Manager while holding office or for a period of two (2) years after his/her term has ended. Section 5.02 - Temporary Absence or Disability of the City Manager By filing a letter with the City Secretary, the City Manager may designate a qualified City administrative officer to be Acting City Manager during any absence of the City Manager. Such designee shall be approved by the City Council. If the City Manager fails to make such designation, the Council shall appoint an Acting City Manager to serve during such times. The Acting City Manager may be removed by a majority vote of the City Council. Section 5.03 - Removal of the City Manager The City Council, acting in its sound discretion, may suspend or remove the City Manager at any time by an affirmative vote of not less than four (4) members of the Council. The City Council shall give the City Manager written notice for removal and/or suspension and give the City Manager an opportunity to respond. Upon written request of the City Manager, the City Council shall schedule a public hearing and provide the City Manager an opportunity to present a defense against any accusations made. The City Council shall not arbitrarily or capriciously suspend or remove the City Manager, but its decision in such matters shall be final. Section 5.04 - Duties and Powers of the City Manager The City Manager shall be responsible to the City Council for the proper administration of all the affairs of the City. Responsibilities of the City Manager shall include the following: (a) Except as otherwise provided in this Charter, appoint, suspend, layoff, demote, or remove any directors or heads of administrative departments, or any other administrative officers, or employees of the City. (b) Supervise and control directly or indirectly all administrative departments, agencies, officers, and employees. (c) Attend all City Council meetings with the right to take part in discussions but have no vote. Scheduled absences shall be with prior approval of the Mayor. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 13 OF 26 O658 CITY OF KENNEDALE, TX 2019 (d) Prepare and submit the proposed annual budget, and be responsible for its administration after it is adopted. (e) Submit to the City Council a report at the end of the fiscal year on the finances and administrative activities of the City for the preceding year. (f) Keep the City Council advised of the financial condition and the future needs of the City, and make such recommendations to the City Council on matters of policy and other matters as may seem desirable. (g) Combine, abolish, or create administrative departments subject to the approval of the City Council. (h) Have such other powers and perform such other duties as prescribed by this Charter and the City Council, in accordance with State Law. Section 5.05 - City Departments There shall be such departments as are established by this Charter or as may be established by ordinance. All departments shall be under the control and direction of the City Manager unless otherwise provided in this Charter. The head or director of each department may serve as a chief of a division within that respective department. The City Manager may appoint one person to serve as the head of two or more departments. With the consent of the City Council, the City Manager may serve as the head of one or more such departments. Section 5.06 - City Secretary The City Council shall appoint the City Secretary by a majority vote. The City Council shall only appoint a person recommended by the City Manager. The City Manager may appoint such assistant city secretaries as the City Council may authorize. The City Secretary shall be the clerical officer of the City Council, and shall keep the minutes, agenda, ordinances, attendance record, and other official records of the City Council and the City. The City Secretary shall be the custodian of the official seal of the City, and shall have such other duties and powers prescribed in this Charter and by the City Council. In addition to the responsibilities stated in this Charter, the City Manager may designate administrative duties to be performed by the City Secretary. Section 5.07 - Removal of City Secretary The City Council, acting in its sound discretion, may suspend or remove the City Secretary at any time by an affirmative vote of not less than four (4) members of the Council. The City Council shall give the City Secretary written notice for removal and/or suspension and shall give the City Secretary an opportunity to respond. Upon written request of the City Secretary, the City Council shall schedule a public hearing and provide the City Secretary an opportunity to present a defense against any accusations made. The City Council shall not arbitrarily or capriciously suspend and/or remove the City Secretary, but its decision in such matters shall be final. Section 5.08 - City Attorney The City Council shall appoint a City Attorney who shall serve at the discretion of the Council and whose compensation shall be fixed by the City Council. The City Attorney shall be licensed to practice law in the State of Texas. The City Attorney shall be the legal advisor of the City INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 14 OF 26 O658 CITY OF KENNEDALE, TX 2019 Council and offices and departments of the City. The City Attorney shall represent the City in all legal proceedings, and shall perform any other duties prescribed by this Charter, ordinance or the City Council. The City Attorney designated may be an individual, partnership or professional corporation composed of individuals licensed to practice law in the State of Texas. Section 5.09 - Special Counsel The City Council shall have the authority to retain special counsel for specific purposes. ARTICLE VI - FINANCE Section 6.01 - Fiscal Year The fiscal year shall begin on the first day of October and end on the last day of the following September. Section 6.02 - Budget (a) Submission of the budget. On or before the fifteenth day of August of each year, the City Manager shall submit to the City Council a balanced budget for the ensuing fiscal year to meet the goals and objectives of the City Council and provide a budget message. (b) Budget Message. The budget message shall explain the budget both in fiscal terms and in terms of work programs for the ensuing fiscal year. It shall outline the proposed financial policies of the City and shall include such other material as the City Manager deems necessary, (c) Budget Contents. The budget shall contain the following: (1) Comparative figures for the estimated income and expenditures for the ensuing fiscal year compared to the combination of: actual income and expenditures through, the latest complete accounting period that information is available for at the commencement of budget preparation, and the estimated income and expenditures for the incomplete portion of the current fiscal year. (2) The proposed expenditures of each office, department, or function. (3) A schedule showing the debt service requirement due on all outstanding indebtedness and on any proposed debt. (4) The source or basis of the estimates. (5) The total of the proposed expenditures which shall not exceed the total estimated income and the balance of available funds. (6) The budget message which shall include a forecast of a five-year estimate of revenues and expenditures and an explanation of its effect on taxation. The source or basis of the estimates shall be a part of the forecast. (7) Such other information as may be required by the Council or deemed desirable by the City Manager. (d) Public Hearing on the Budget. The Council shall hold one or more public hearings on the proposed budget prior to the final adoption. (e) Adoption of the Budget. The City Council shall adopt the proposed budget, with or without amendment, after public hearings and before the first day of the ensuing fiscal year. Should the Council take no final action before the first day of the ensuing fiscal year, the amounts appropriated for the current fiscal year shall be deemed adopted on a month to month basis. Final adoption shall constitute appropriation of the expenditures proposed from funds so indicated. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 15 OF 26 O658 CITY OF KENNEDALE, TX 2019 (f) Adjustments after Adoption. During the fiscal year, the City Council shall have the power to make budget adjustments. Expenditures that could not, by reasonable thought and attention, have been included in the original budget, may be authorized by the City Council. All such authorizations by the City Council shall be filed as amendments to the original budget, including the reasons for such amendments. (g) Defects in the Budget. Defects in the form or preparation of the budget or the failure to perform any procedural requirements shall not invalidate any tax levy, nor shall it invalidate the tax roll. Section 6.03 - Monthly Financial Reports The City Manager shall present a monthly financial report and such additional information as may be required by the City Council. All income and expenses for the preceding month and for the year to date shall be shown, and shall be compared to the fiscal budget. The City shall provide copies of the monthly financial reports to the public at cost, upon request. Section 6.04 - Annual Audit The City Council, by a majority vote of the entire Council, shall select and shall contract with a municipally oriented certified public accounting firm for the purpose of rendering an independent audit of all accounts and other financial records of the City government. The personnel of the firm conducting the audit shall not hold any public office in the City nor have any personal interest, direct or indirect, in the fiscal affairs of the City government or any of its offices. After completion of any audit of the City, the auditor shall prepare a report, and shall submit the report to the City Council, within one hundred eighty (180) days after the end of the fiscal year. The City shall provide copies to the public at cost, upon request. Section 6.05 - Indebtedness (a) The City shall have the right to issue and refund general obligation bonds, revenue bonds, and other evidence of indebtedness as is now permitted or as may be hereafter authorized to be issued by a Home Rule City in the State of Texas. All bonds of the City that have been issued, sold, and delivered to the purchaser shall be incontestable. All refunding bonds that have been exchanged shall be incontestable. (a) General Obligation Bonds. The City shall have the power to borrow money through general obligation bonds, which shall constitute direct and general obligations of the City, payable from ad valorem taxes levied against all taxable property located therein, within the limits prescribed by law or this Charter. (b) Revenue Bonds. The City shall have the power to borrow money for constructing, purchasing, improving, extending, or repairing public utilities, recreation facilities, or any other self-liquidating municipal function not prohibited by state law. Such borrowing shall be implemented through revenue bonds that are payable, both as to the principal and interest, solely from and secured by a first lien on and pledge of the net revenue derived from the properties, the interest pledged from the income, or both, after deduction of reasonable operating and maintenance expenses as required by law. The holders of the revenue bonds shall never have the right to demand payment thereof from monies raised or to be raised by taxation. (c) Short Term Borrowing. The Additionally, the City may borrow funds on the credit of the City for a term not to exceed one year provided that such . Such obligations are scheduled to must be retired by the end of the budget year in which they were issued. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 16 OF 26 O658 CITY OF KENNEDALE, TX 2019 (d) Certificates of Obligation. The City shall have the power to issue Certificates of Obligation in accordance with the laws of the State of Texas. If, prior to the date tentatively set for the authorization of the issuance of the certificates, a petition signed by five percent (5%) of the qualified voters of the City is filed with the City Secretary protesting the issuance of such certificates, the City shall not be authorized to issue certificates for such purpose unless the issuance thereof is approved at an election called, held, and conducted in the manner provided for bond elections by the laws of the State of Texas. ARTICLE VII - REVENUE AND TAXATION Section 7.01 - Municipal Taxes All taxes due the City shall be payable at the office of the Tax Collector, who shall be designated by the Council, and may be paid at any time after the tax rolls for the year have been completed and approved, which shall be no later than October 1st. Taxes shall be paid on or before January 31st, of each year following the year for which the taxes are levied, and all such taxes not paid on or prior to such date shall be deemed delinquent and shall be subject to such penalty and interest as prescribed by State law. The Council may provide further by ordinance all taxes, either current or delinquent, due the city may be paid by installments. Failure to levy and assess taxes through omission, in preparation of the approved tax roll, shall not relieve the person, firm, or corporation so omitted from obligation to pay such current or past due taxes as shown to be payable by recheck of the rolls and receipt for the years in question. Section 7.02 - Power to Tax The Council shall have the power granted to municipalities by the Constitution and laws of the State of Texas to levy, assess and collect lawful taxes on property within the territory of the City, not to exceed the maximum limits set by the Constitution and laws of the State of Texas or restricted by this Charter. Section 7.03 - Appraisal and Assessment of Real Property All taxable property situated within the corporate limits of the City on the first day of January of each year, not expressly exempted by law, shall be subject to yearly taxation by the City. As prescribed by State Law, the assessed value of such property shall be One-Hundred (100) percent of its appraised value on January 1 as determined by the Tarrant Appraisal District or its successor. Section 7.04 - Tax Rate The tax rate shall be calculated, publicized and adopted in accordance with the State Property Tax Code. Section 7.05 - Election to Repeal Tax Increase If the City Council adopts a tax rate that exceeds the Roll Back Rate, the qualified voters of the City, by petition, may require that an election be held to determine whether or not to reduce the tax rate adopted for the current year to equal the Roll Back Rate. Such petition is valid if it complies with State Law. Section 7.06 - Tax Exemptions and Abatements (a) The City Council may pass, by ordinance, exemptions and abatements as provided by State Law. Exemptions and abatements shall include, but not be limited to, over 65 exemptions, INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 17 OF 26 O658 CITY OF KENNEDALE, TX 2019 disabled exemptions, and tax abatements. (b) The Tarrant Appraisal District shall prescribe the method and manner in which such exemptions may be secured by qualified property owner(s) according to State Law. Section 7.07 - Tax Payments All taxes due the City shall be payable in legal tender to the City or its agent, and shall become due and payable upon receipt of the tax bill. Such taxes shall be delinquent if not paid before February 1 of the year following the year in which imposed. The interest and penalty on delinquent taxes shall be assessed as provided by State Law. Section 7.08 - Tax Liens and Liability (a) Real and Personal Property. On January 1 of each year, a tax lien in favor of the City attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed for the year on that property, whether or not the taxes are imposed in the year the lien attaches. The lien shall have priority over all other claims except as provided by law. (b) Business and Non-Business Personal Property. Upon securing a tax warrant as provided by State Law, the City may seize, and take possession pending the sale of, as much of any business personal property, or certain non-business taxable personal property as may be reasonably necessary for the payment of all taxes, penalties, and interest owed, as well as all costs of seizure and sale. ARTICLE VIII - BOARDS AND COMMISSIONS Section 8.01 - Boards and Commissions—General (a) In addition to the boards and commissions established by this Charter, the City Council shall be empowered to create additional boards and commissions. Each appointed member of the Boards and Commissions of the City shall meet the following qualifications: (1) Be a registered voter of the City; (2) shall have resided in the City for one year, and (3) continue residency in the City during the term of office. (b) The City Secretary shall provide application forms to all qualified citizens who express interest in serving on the boards and commissions. All such applicants shall receive due consideration by the City Council however, the City Council may select and appoint any qualified person. (c) The City Council shall have the authority to remove any appointee from any board or commission. (d) The City Council shall by ordinance set the size, quorum, length of terms, rules of order and organization of each City board and commission. Section 8.02 - Planning and Zoning Commission A Planning and Zoning Commission shall be established to advise and formulate recommendations to the City Council for the improvement, planned growth, health, safety and well being of the City. The duties and powers of the Planning and Zoning Commission shall include the following: (a) To prepare and recommend for approval by the City Council, a long range comprehensive city plan for the orderly physical development of the City, and to review and make recommendations for revisions to the City Plan as necessary, but such review shall be made no less frequently than once every five years. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 18 OF 26 O658 CITY OF KENNEDALE, TX 2019 (b) To review proposed changes in zoning districts and make recommendations to the City Council, in accordance with procedures for such review as established by ordinance. (c) To review and approve or deny proposed platting or subdivision of land within the City and its extraterritorial jurisdiction, in accordance with procedures established by ordinance and State Law. (d) Any other duties or powers assigned to the Commission by ordinance. Section 8.03 - Zoning Board of Adjustment (a) A Zoning Board of Adjustment shall be established to hear appeals from any aggrieved person, entity or by, any officer, department or board of the City affected by any decision pertaining to zoning. (b) The Board of Adjustment shall have all powers granted by, and shall be controlled by the provisions of State Law. The Board is vested with the power and authority, and in appropriate cases and subject to appropriate conditions and safeguards, to make such variances, exemptions and exceptions to the terms of appropriate ordinances in harmony with their special rules therein contained for the purposes of rending full justice and equity to the general public. The City Council shall establish, by ordinance, Zoning Board of Adjustment procedures for accepting, hearing and acting upon appeals. Section 8.04 - Parks and Recreation Board A Parks and Recreation Board shall be established to advise and formulate recommendations to the City Council for the use, improvement and growth of parks and recreation activities within the City. ARTICLE IX - MUNICIPAL COURT Section 9.01 - Establishment of the Municipal Court A municipal court, known as the "Municipal Court of Kennedale, Texas" is hereby established. The Municipal Court shall have the jurisdiction, powers, and duties given and prescribed by the laws of the State of Texas. The City Council shall have the power to create and establish by ordinance additional municipal courts. Section 9.02 - Fines, Fees, and Costs All fines, penalties, fees, or costs collected by the Municipal Court shall be deposited in the City treasury. No fee or costs shall be charged except those authorized by State Law. Neither the compensation of the Judge of the Municipal Court, nor of any full or part-time employee of the City, shall be based upon a percentage of the fines imposed by the Municipal Court. Section 9.03 - Judge of the Municipal Court The City Council shall appoint a Judge who shall be known as the "Judge of the Municipal Court". The Judge shall be appointed for a two (2) year term. In order to be appointed, the Judge must be a resident of the State of Texas. The City Council shall fix the compensation for the Judge. The City Council, acting in its sound discretion, may suspend or remove the Municipal Judge at any time by a majority vote of the entire Council. The City Council shall give the Municipal Judge written notice for removal and/or suspension and give the Municipal Judge opportunity to respond. Upon written request of the Municipal Judge, the City Council shall schedule a public hearing and provide the Municipal Judge an opportunity to present a defense INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 19 OF 26 O658 CITY OF KENNEDALE, TX 2019 against any accusations made. The City Council shall not arbitrarily or capriciously suspend or remove the Municipal Judge, but its decision in such matters shall be final. If for any reason the Judge is unable to act, the City Council shall either declare the office vacant, or appoint a temporary Judge to serve until the Judge is able to act. If the office of the Judge is declared vacant, it shall be filled by appointment by the City Council in accordance with this Section. Following appointment the Judge must meet all educational or other qualifications as prescribed by State Law. The City Council may also appoint such alternate Judges as necessary. All alternate Judges must meet the same qualifications as the Judge of the Municipal Court. Section 9.04 - Clerk of the Municipal Court The City Manager shall appoint a clerk who shall be known as the "Clerk of the Municipal Court". The Clerk of the Municipal Court shall keep the records and the proceedings of the Court, issue all processes, and generally perform all the duties prescribed by law for clerks of such courts, insofar as those duties are applicable. Section 9.05 - City Prosecutor The City Council shall appoint a City Prosecutor who is licensed to practice law in the State of Texas. The City Council shall fix the compensation for the City Prosecutor and determine the length of time for the appointment. The City Prosecutor may be an individual, partnership or professional corporation composed of individuals licensed to practice law in the State of Texas. ARTICLE X - FRANCHISES AND PUBLIC UTILITIES Section 10.01 - Franchise Power of the City In addition to the City's power to buy, construct, lease, maintain, operate, and regulate public utilities within and without the City limits, and to manufacture, distribute and sell the commodities or products of such utility operations required by the public, the City shall have such further powers as may now or hereafter be granted under the Constitution and laws of the State of Texas. Section 10.02 - Power to Grant Franchises The City Council shall have the power by ordinance, after public hearing, to grant, renew, and extend all franchises for all public utilities of every character operating within the City and, with the consent of the franchise holder, to amend the same, provided, however, that no franchise shall be granted for an indeterminate term, and that no franchise shall be granted for a term of more than twenty (20) years from the date of the grant, renewal or extension. Council action on all ordinances granting, renewing, extending or amending a public utility franchise shall comply with the applicable provisions set forth in Section 3.10 of this Charter. Section 10.03 - Exclusiveness of Franchises No grant or franchise to construct, maintain, or operate a public utility and no renewal or extension of such grant shall be exclusive. Section 10.04 - Transfer of Franchises No public utility franchise shall be transferable except by the approval of the City Council expressed by ordinance following a public hearing. The term "transferable", as used herein, shall not be constructed in such a manner as to prevent the franchise holder from pledging said franchise as security for a valid debt or mortgage. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 20 OF 26 O658 CITY OF KENNEDALE, TX 2019 Section 10.05 - Extensions of Public Utilities All extensions of service of public utilities within the City limits shall become a part of the aggregate property of the public utility, shall operate as such, and shall be subject to all the obligations and reserved rights contained in this Charter and in any original grant hereafter made. The right to use and maintain any extension shall terminate with the original grant and shall be terminable as provided in Section 10.06. In case of an extension of a public utility operated under a franchise hereafter granted, such right shall be terminable at the same time and under the same conditions as the original grant. Section 10.06 - Right of Franchise All grants, removals, extensions, or amendments of public utility franchises shall be subject to regulation by the City Council. The City Council, by ordinance, shall have the following powers: (a) To repeal the same by ordinance at any time for failure to begin construction or operation within the time prescribed or otherwise to comply with the terms of the franchise, such power to be exercised only after due notice and hearing. (b) To require an adequate extension of plant and service as is necessary to provide adequate service to the public and maintenance of the plant and fixtures at the highest reasonable standard of efficiency. (c) To impose regulations that insure safe, efficient and continuous service to the public. (d) To require at any time such compensation and rental as may be permitted by the laws of the State of Texas. (e) To require the franchise holder to restore at the franchise holder's expense, all public or private property to a condition equally as good or better than before disturbed by construction, repair or removal. The franchise holder in opening and refilling of all earth openings shall re-lay the pavement and do all other work necessary to complete restoration of streets, sidewalks or grounds to a condition equally as good or better as when disturbed. (f) To require every franchise holder to furnish within a reasonable time to the City, without cost to the City, a general map, with updates outlining the location, character, size, length, and terminals of all facilities of such franchise holder in, over, and under ground of property in the City and to provide detailed information on request. Section 10.07 - Records and Accounts The City Council shall periodically examine, and may, if deemed appropriate, request and audit the records of all franchise holders and municipally owned public utilities. T he City Council shall also demand that all franchise holders and municipally owned public utilities keep a standard system of accounting and furnish reports on the local operations of the utility. Such reports shall be prepared in such form and contain such information as the City Council shall prescribe. Section 10.08 - Sale of Municipal Services The City Council shall have the power and authority by ordinance to sell and provide such public services as may be beneficial to the City. Section 10.09 - Ownership and Control of Streets, etc. The sole right of control and use of the public street, sidewalks, highways, bridges, alleys, public places, and other real property of the City is hereby declared to be inalienable. The City Counci l INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 21 OF 26 O658 CITY OF KENNEDALE, TX 2019 may prohibit the use of any property or right of way within the City limits to any public utility, whether the use be under, over, or on such property. Section 10.10 - Regulation of Rates The Council shall have full power after due notice and hearing to regulate by ordinance the rates, charges and fares of all public utility franchise holders operating in the City, provided that no such ordinance shall be passed as an emergency measure. Upon receiving a request from a public utility franchise holder requesting a change in rates, the Council shall call a public hearing for consideration of the change. All such franchise holders who shall request an increase in rates, charges, or fares shall have, at the hearing of the Council called to consider such request, the burden of establishing by clear, competent, and convincing evidence the value of its investment property allocable to service in the City, and the amount and character of its expenses and revenues connected with the rendering of such service. If, upon such hearing, the Council is not satisfied with the sufficiency of the evidence furnished, it shall be entitled to call upon such public utility for the furnishing of additional evidence at a subsequent date to which said hearing may be adjourned. No public utility franchise holder shall institute any legal action to contest any rate, charge, or fare fixed by the Council until such franchise holder has filed a motion for rehearing with the Council setting out each ground of its complaint against the rate, charge, or fare fixed by the Council, and until the Council shall have acted upon the motion within a reasonable time, not to exceed sixty (60) days from the filing of such motion for rehearing; provided, that the Council may by resolution extend such time of acting on said motion for rehearing from sixty (60) days to ninety (90) days. The City shall have the power to employ at the expense of the franchise holder, expert assistance and advice in determining a reasonable rate and equitable profit to the franchise holder. Section 10.11 - Discrimination The City Council shall prevent unjust discrimination in service or rates by all franchise holders. Section 10.12 - Franchise Records The City shall compile and maintain a public record of utility franchises. Section 10.13 - Franchises Granted Before Ratification of this Charter All franchises granted before ratification of the Charter are recognized as contracts between the City and the grantee, and the contractual rights contained in any such franchise shall not be impaired by the provisions of the Charter. ARTICLE XI - INITIATIVE, REFERENDUM, AND RECALL Section 11.01 - Initiative The qualified voters of the City shall have the power to propose any ordinance, except an ordinance related to zoning, the appropriation of money or the authorization of the levy of taxes or one repealing such an ordinance, and to adopt or reject the same ordinance at the polls, such power being known as "initiative". Any initiated ordinance may be submitted to the City Council by a petition signed by qualified voters equal in number to at least thirty twenty-five (3025) percent of the votes cast in the last regular municipal election, but not less than five two hundred and fifty (500250) signatures. Such initiated ordinance may be passed by the City Council without change, or may be submitted to the voters at an election called for that purpose. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 22 OF 26 O658 CITY OF KENNEDALE, TX 2019 Section 11.02 - Referendum The qualified voters of the City shall have power to require reconsideration by the City Council of any adopted ordinance, excepting those ordinances relating to zoning the appropriation of money or the levy of taxes, such power being known as "referendum". In the submission of a petition for referendum, the number and qualifications of signers shall be the same as required in this Charter for an initiative petition, except that referendum petitions must be filed with the City Secretary within sixty (60) days after the effective date of the ordinance that is the subject of the referendum. When such petition has been certified as sufficient by the City Secretary, the ordinance specified in the petition shall not go into effect, or if it has gone into effect, further enforcement or action thereunder shall be suspended unless and until such ordinance is approved by the voters as provided herein. Section 11.03 - Recall The qualified voters of the City shall have the power to recall any elected official of the City and may exercise that power by filing with the City Secretary a petition containing the same number of signatures and qualifications as required for an initiative petition under this Charter. If the petition is certified by the City Secretary to be sufficient, the officer whose removal is sought may request that a public hearing be held to permit the officer the opportunity to present facts pertinent to the recall petition. If the officer does not resign, the City Council shall call an election to determine whether the official named in the petition shall be recalled. The election shall be held no earlier than thirty (30) days after the City Council receives the petition, nor no later than the next special election as allowed in the Texas Election Code. Section 11.04 - Results of Recall Election If the majority of the votes cast in a recall election are for the recall of the officer named on the ballot, the City Council shall immediately declare that office vacant, and the vacancy shall be filled in accordance with the provisions of this Charter. Section 11.05 - Limitation of Recall No recall petition shall be accepted against an elected official within six (6) months after taking office, and no official shall be subjected to more than one recall election during a term of office. Section 11.06 - Form of Petitions All papers for any particular petition circulated for the purpose of an initiative, referendum, or recall shall be uniform in size and style. Initiative petitions shall contain the full text of the proposed ordinance, and referendum papers shall contain a description sufficient to identify positively the ordinance sought to be repealed. The signatures to initiative, referendum, or recall petitions need not be appended to one paper, but all pages that compose a single petition shall be assembled and given to the City Secretary as one instrument with an attached affidavit. The affidavit attached to the petition shall be prepared by the person who files it, and shall bear the stated number of signatures and a statement to the effect that all signatures appended to the petition are, in his belief, the genuine signatures of the persons whose names they purport to be. Names, addresses, and voter registration certificate numbers of the signers of such petitions shall be printed adjacent to their signatures. Section 11.07 - Filing, Examination, and Certification of Petitions Petitions for initiative, referendum, or recall shall be filed with the City Secretary. Within twenty INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 23 OF 26 O658 CITY OF KENNEDALE, TX 2019 (20) days after a petition is filed, the City Secretary shall determine whether the petition has been signed by a sufficient number of qualified voters, whether it has a proper, attached affidavit of the person who filed the petition and whether it otherwise meets the procedures of this Charter and other laws. After completing an examination of the petition, the City Secretary shall certify the results to the City Council at its next regular meeting. If the petition is insufficient, the City Secretary shall set forth in a certificate the reasons for its insufficiency, and shall at once notify the person who filed it of the findings. Section 11.08 - Amendment of Petitions An initiative, referendum, or recall petition certified insufficient for lack of the required number of valid signatures or due to inadequate form or content may be amended once if the Petitioner files a notice of intention to amend it with the City Secretary within five (5) days after receiving the copy of the certificate and files a supplementary petition upon additional papers within ten (10) days after receiving the copy of such certificate. Amendment in the form of a supplementary petition must be signed and filed as provided for in the original petition. The same procedures established for an original petition shall then be followed by the City Secretary and City Council. The findings of the insufficiency of a petition shall not prejudice the filing of a new petition for the same purpose. Section 11.09 - Consideration by the City Council Whenever the City Council receives a certified initiative or referendum petition from the City Secretary, it shall proceed at once to consider such petition. A proposed initiative ordinance shall be considered in a public hearing held by the City Council. The City Council shall take final action on an initiative or referred ordinance not later than thirty (30) days after the date on which it was submitted to the City Council by the City Secretary. Section 11.10 - Submission to Voters If the City Council fails to pass an ordinance proposed by initiative petition in the exact form proposed, or it fails to repeal a referred ordinance, the ordinance shall be submitted to the voters not less than thirty (30) days from the date the City Council takes its vo te, or not later than the special election date as allowed in the Texas Election Code. Section 11.11 - Results of Election When a majority of the votes cast on a proposed ordinance are favorable, it shall become an ordinance of the City, upon certification of the election results. A referred ordinance shall be approved by a majority of the voters. If conflicting ordinances are approved by the voters at the same election, the one receiving the greatest number of affirmative votes shall prevail to the extent of such conflict. ARTICLE XII - GENERAL PROVISIONS Section 12.01 - Public Meetings Meetings of all elected commissions and all boards or commissions appointed by the City Council shall be open to the public in accordance with the laws of the State of Texas. Meetings of the City Council shall be held in accordance with provisions of this Charter. Minutes, transcriptions and recordings of all public meetings shall be archived according to State Law and shall be public records. INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 24 OF 26 O658 CITY OF KENNEDALE, TX 2019 Section 12.02 - Public Record Municipal records shall be available for public inspection during normal business hours, in accordance with state law. The cost, to any person requesting noncertified reproductions of public records, shall be established by the City Council. Section 12.03 - Effective Date of this Charter This Charter shall become effective on and after the date and time of the first meeting of the City Council following the election at which a majority of votes cast by qualified voters of the City affirms adoption of this Charter. The City Council shall, immediately after canvassing said election, declare by resolution that this Charter is adopted. The City Council shall then order that this resolution be recorded upon the records of the City of Kennedale, Texas, and the records of the Secretary of State of Texas, as prescribed by the laws of the State of Texas. Section 12.04 - Effect of Charter on Existing Law All ordinances, resolutions, rules and regulations in force in the City on the effective date of this Charter, and not in conflict with this Charter, shall remain in force until altered, amended or repealed. All taxes, assessments, liens, encumbrances and demands, of or against the City, fixed or established before such date, or for the fixing or establishing of which proceedings have begun at such date, shall be valid when properly fixed or established either under the law in force at the time of beginning of such proceedings or under the law after the adoption of this Charter. Section 12.05 - Continuation of Present Offices All persons holding administrative office at the time this Charter takes effect shall continue in office and in the performance of their duties until provision shall have been made in accordance therewith for the performance of such duties or the discontinuance of such office. The powers conferred and the duties imposed upon any office, department or agency of the City by the laws of the State shall, if such office, department or agency be abolished by this Charter or under its authority, be thereafter exercised and discharged by the office, department or agency designated by the Council unless otherwise provided herein. Section 12.06 - Amendments to this Charter Amendments to this Charter may be formulated and submitted to the voters as provided by State Law. Section 12.07 - Conflict of Interest Officers or employees of the City having a direct or indirect interest in any proposed or existing contract, purchase, work, sale, or service to, for, or by the City shall not vote or render a decision, or use their position, authority, or influence in any manner that would result in personal betterment, financially or otherwise, to any degree. Every elected officer shall publicly disclose any such interest upon assumption of office or prior to consideration of any such matters. Any officer or employee who willfully conceals such interest or willfully violates the requirements of this section shall be guilty of malfeasance in office or position, and shall forfeit the office or position. Violation of this section with the knowledge, express or implied, of the person or corporation contracting with or making a sale to the City shall render such contract or sale voidable by the City Manager or City Council. Section 12.08 - Nepotism INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 25 OF 26 O658 CITY OF KENNEDALE, TX 2019 (a) No member of the same household of a City Council member or the City Manager of the City shall be employed in a paid position for public service to the City, except as permitted by State law. (b) No person related to a member of the City Council or the City Manager of the City shall be employed in a paid position for public service to the City if such kinship is closer than the second degree by marriage or the third degree by consanguinity, except as permitted by State Law. Section 12.09 - Guarantee of Funds The City Council shall require that the depository or depositories holding all public funds shall pledge eligible securities or surety bonds against said funds to the extent of the total of such funds held by each and every depository in accordance with the laws of the State of Texas. Section 12.10 - Notice of Injury or Damage Before the City of Kennedale shall be liable for damages for the death or personal injuries of any person or for damage to or destruction of property of any kind that does not constitute a taking or damaging of property under the Constitution of Texas, the person injured, or if deceased, his or her representatives shall give the City Council or City Manager notice in writing of such death, injury, damage, or destruction, duly verified by affidavit, within thirty (30) days after same has been sustained. Such written notice shall state specifically when, where, and how such death, injury, damage, or destruction occurred; the apparent extent of any such injury; the amount of damages sustained; the street and number of the actual residence of the claimant at the date the claim is presented; the actual residence of the claimant six months immediately preceding the occurrence of such death, injury, damage, or destruction and the names and addresses of all witnesses upon whom it is relied to establish the claim for damages. The failure to so notify the City Council or City Manager within the time and manner specified herein shall exonerate, excuse, and exempt the City from any liability whatsoever. No act of any officer or employee of the City shall waive compliance or stop the City from requiring compliance, but the provision may be waived by resolution of the City Council, made and passed after the expiration of the thirty (30) day period herein provided and evidenced by minutes of the City Council. Section 12.11 - Official Medium The City Council shall, by resolution, designate a local legal newspaper or newspapers of general circulation in the City as the official newspaper(s) for publication of official business. All ordinances, notices, and other matters that are required to be published officially by this Charter, ordinances of the City, or the laws of the State of Texas shall be publicized in said medium. Section 12.12 - Gender of Wording The gender of wording used throughout this Charter shall be interpreted to mean either sex. Section 12.13 - Qualified Voter The word "voter", as referred to in this Charter, shall be defined as an individual who meets the requirements of thirty (30) days residency in the City of Kennedale, Texas, and is a registered voter in the State of Texas. Section 12.15 - Official Oath of Office INCLUDING EXHIBIT A: “2019 PROPOSED CHARTER”, PAGE 26 OF 26 O658 CITY OF KENNEDALE, TX 2019 (a) Before taking the oath or affirmation of office prescribed by this Section and entering upon the duties of office, all elected officials of the City shall subscribe to the following statement: I, ____________, do solemnly swear (or affirm) that I have not directly or indirectly paid, offered, promised to pay, contributed, or promised to contribute any money or thing of value, or promised any public office or employment, for the giving or withholding of a vote at the election at which I was elected so help me God. (b) Before taking the oath or affirmation of office prescribed by this section and entering upon the duties of office, all appointed officials of the City shall subscribe to the following statement: I, ____________,do solemnly swear (or affirm) that I have not directly or indirectly paid, offered, or promised to pay, contributed, or promised to contribute any money, or valuable thing, or promised any public office or employment, as a reward to secure my appointment or confirmation thereof, so help me God. (c) Before entering upon the duties of their offices, all elected and appointed officials of the City shall take the following oath or affirmation: I, ____________, do solemnly swear (or affirm) that I will faithfully execute the duties of the office of ____________ of the City of Kennedale of the State of Texas and will to the best of my ability preserve, protect and defend the Constitution and laws of the United States and of this State, and the Charter and ordinances of this city, so help me God. Section 12.16 - City Exempt for Appeal Bonds It shall not be necessary in any action, suit, or proceeding in which the City of Kennedale is a part of any bond, undertaking, or security to be executed in behalf of said City. All such actions, suits, appeal, or proceedings shall be conducted in the same manner as if such bond, undertaking, or security had been given; and the City shall be liable as if s uch obligation had been given and executed. Section 12.17 - Funds not Subject to Garnishment No funds of the City or within the custody of the City or any of its officials in any official capacity shall be subject to garnishment, and the City shall not be required to answer in any garnishment proceedings. Section 12.18 - Certification and Submission to Voters Pursuant to the obligations imposed on this Charter Commission by law, said Commission has determined and hereby certifies: (a) That this Charter is a true and correct copy of the Charter prepared by this Charter Commission. (b) That, in the submission of this Charter to the voters, it would be impracticable to segregate each subject for a separate vote thereon, for the reason that the Charter is so constructed that, in order to enable it to work and function, it is necessary that it be adopted in its entirety, therefore it is submitted so as to be voted upon as a whole. (c) That the election for this purpose shall be held in the City of Kennedale on the 17th day of January, 1998. (d) That the Charter Commission completed its work on the 25th day of November, 1997. STAFF REPORT TO THE HONORABLE MAYOR AND CITY COUNCIL Date: February 11, 2019 Agenda Item No: DECISION ITEMS - B. I. Subject: Discuss and consider Resolution 543, a Resolution of Support for an application to the Texas Department of Housing and Community Affairs (TDHCA) 2019 Housing Credit Program by OM Housing, LLC to partially finance the mixed- use development of The Village at Hammack Creek, located at the northeast corner of East Kennedale Parkway and Kennedale Sublett Road II. Originated by: Melissa Dailey, Director of Planning and Economic Development III. Summary: OM Housing is proposing a $50 million redevelopment of approximately 16 acres at the northeast corner of Kennedale Parkway and Kennedale Sublett Road (133 E Kennedale Parkway). As a catalyst project in the center of the community, this development inherently carries more risk than subsequent ventures might. As such, cities commonly offer incentives in an effort to spur investments like this one. OM Housing is, instead, proposing to utilize Federal incentives to mitigate these risks in the form of Housing Tax Credits that would provide 9% of the financing. If awarded, these credits would be provided directly to the developer and would require a maximum rental fee for the 112 multi-family homes included in the proposed development, which would also include 16 market-rate townhomes, 31,000 square feet of retail, and 7,500 square feet of office space. This development would offer high-quality workforce housing in a vibrant neighborhood setting that aligns with the wages of many of those employed locally. For example, a one-bedroom apartment would have a maximum rent of $846.00 for someone earning up to 60% of AMFI (Area Median Family Income). OM Housing plans to utilize Urban Village zoning, which has stringent requirements aimed at ensuring that the project is tailored to meet the unique needs and desires of the community by providing public realm amenities that make it a destination, but also promote walkability. A mixed-use development of this scope is likely to encourage additional investments in this historically underutilized area, providing the synergy necessary to attract shoppers and retail tenants to TownCenter. It would also serve as significant progress on several key goals of the Comprehensive Plan: To create vibrant centers by promoting social integration and economic activity through the development of different-scale centers throughout the community, To promote access to housing options for people of varying financial means and residential preferences, and To promote access to jobs by creating employment opportunities within Kennedale that help to stabilize the local tax base and allow residents to work close to home. IV. Fiscal Impact Summary: V. Legal Impact: VI. Recommendation: Approve VII. Alternative Actions: Staff recommends approval of OM Housing, LLC’s request for support of their application for Housing Tax Credits. VIII. Attachments: 1.2019_02.07Memo_SupportLetters 2019_02.07Memo_SupportLetters.pdf 2.Village at Hammack Creek Slides from Previous Meeting 2019_02.11_Village at Hammack Creek.pdf 3.R543_Resolution of Support for Village at Hammack Creek R543 Support of OM Housing Tax Credit Application for Village at Hammack Creek (TDHCA).pdf CITY OF KENNEDALE | www.cityofkennedale.com MEMO RANDUM to the Mayor and City Council DATE: Thursday, February 07, 2019 SUBJECT: Letters of Support, Decision Item B ORIGINATED BY: Melissa Dailey, Director of Planning & Economic Development Attached are letters of support that were provided to staff for Decision Item B on the Monday, February 11 agenda. SHOULD YOU HAVE ANY QUESTIONS REGARDING THIS REPORT, PLEASE CONTACT MELISSA DAILEY AT 817-985-2135 OR MDAILEY@CITYOFKENNEDALE.COM. VILLAGE AT HAMMACK CREEK PROPOSED 16-ACRE MIXED-USE DEVELOPMENT VILLAGE AT HAMMACK CREEK 4.75 acres retail/office development 31,000 sf retail 7,500 sf office 2.12 acres townhomes (16 in Phase I) 7 acres multi-family homes (112) 2+ acres open space Affordable housing; Not low-income or Section 8 No subsidies provided directly to residents This is workforce housing with max rents: 1 bedroom $846 2 bedroom $1,015 3 bedroom $1,173 VILLAGE AT HAMMACK CREEK WHAT ARE HOUSING CREDITS? Congressional Program enacted in 1986 under President Reagan Private financing of high-quality housing Administered by the Texas Department of Housing and Community Affairs (TDHCA) GOAL  to provide high-quality affordable housing and spur economic development 112 apartments 20% market rate 80% affordable housing Workforce Housing: 30-60% AMFI (Area Median Family Income = $75,200 in 2018) Income limits for this development (60%) Household of 1 $31,620 Household of 2 $36,120 Household of 3 $40,520 Household of 4 $45,120 VILLAGE AT HAMMACK CREEK $50 million development $1.24 million direct annual impact $36.5 million over 20 years City property tax $363,000/year $10.7 million over 20 years KISD property tax $726,000/year $21.4 million over 20 years Est. Sales Tax $150,000/year $4.4 million over 20 years ECONOMIC IMPACT 150+ construction jobs 50+ permanent jobs Business for local vendors ECONOMIC IMPACT Page 1 of 1 R543 CITY OF KENNEDALE, TX 2019 RESOLUTION NO. 543 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF KENNEDALE, TEXAS, SUPPORTING OM HOUSING’S APPLICATION FOR HOUSING TAX CREDITS FOR THE PROPOSED VILLAGE AT HAMMACK CREEK PROJECT. WHEREAS, OM Housing, LLC, has proposed The Village at Hammack Creek – a mixed use development for high quality, eco-friendly, retail, office, and rental apartments at 133 E Kennedale Parkway in the City of Kennedale; and WHEREAS, the naming of the proposed project as “Hammack” is reflective of Kennedale history – Dr. J. A. Hammack and the tributary located on the site; and WHEREAS, OM Housing, LLC, intends to submit an application to the Texas Department of Housing and Community Affairs (TDHCA) for 2019 Housing Credit Program to partially finance the development of The Village at Hammack Creek; and WHEREAS, The Village at Hammack Creek project will be required to comply with all City zoning and site development regulations/standards, prior to issuance of any building permits; and WHEREAS, the proposed Village at Hammack Creek will be required to be consistent with the Kennedale Comprehensive Plan, to be an eco-friendly facility, and be architecturally compatible with the TownCenter. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF KENNEDALE, TEXAS: This Resolution affirms the City of Kennedale’s acknowledgement and support of the application for the Village at Hammack Creek subject to the provisions noted in the preamble. DULY PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF KENNEDALE ON THE 11TH DAY OF FEBRUARY, 2019. APPROVED: ______________________________ MAYOR, BRIAN JOHNSON [ C I T Y S E A L ] ATTEST: ______________________________ CITY SECRETARY, LESLIE GALLOWAY