Planning Commission - Regular Meeting

See, you

here. Commissioner Hedrickk here. Commissioner Bud here. Commissioner Cantu here. Commissioner Tickleman here. Commissioner Espanza here. Commissioner Jackson here. Quorum has been established to conduct the meeting. Thank you. And uh could you read us the rules for public comment, please? Yes, citizens will be allowed to attend and make public comments in person at the city planning commission meetings. The public is invited to speak on any agenda item and any other items that pertain to the planning commission. Comments are limited to three minutes. If you choose to speak during this period, you will not be allowed to speak again when the item is being considered in order of the agenda.

Okay. Thank you. At this time, I'll go ahead and open up the public comment. If anyone would like to come and speak on anything on the uh other than tonight's agenda, please come forward. If not, then I'll go ahead and close the public comment and move on to the approval of absences for Commissioner Tykeleman and Commissioner Miller for February 18th, 2026. I move that we approve the absences of Commissioner Telman and Miller. Second. I have a motion and a second. All those in favor say I. I. All those opposed? Motion passes. Moving on to the approval of minutes for February 18, 2026.

I'll make a motion to approve the minutes on February 18th, 2026. I'll second. I have a motion and a second. All those in favor say I. I. All those opposed. Motion passes. Moving on to the consent public hearing discussion and possible action for items A and B.

Thank you, Madam Chair. For the record, Andrew Deeus with development services reading in tonight's consent agenda. Starting with letter A plat number two, a master preliminary plat for Sunset Ridge Estates. Item number three, a preliminary plat for Park Punit 2. Item number four, a replat for Shatzel McMin. Item number five, a replat for Comedream come subdivision trench 2. Item number six, replat for Bratton Place unit 2. Staff and the technical review committee have reviewed the following plats and deemed that they are consistent with the UDC as well as Texas local government code. Staff recommends approval. Under letter B, plat time extension, we have just one item, item number seven, a preliminary plat of Oso Vista subdivision units one and two. If approved, it would be a 2-year time extension at is as it is a preliminary plat. Uh that concludes tonight's consent agenda. If there are any questions, I'd be happy to address them.

Thank you, Andrew. Uh, commissioners, do we have any questions for staff on items 2 through 7? I have a question on uh item number two. Um, on the plat there's a lot of streets that are labeled as private. What does that indicate? As it is a master preliminary plat, that final decision has not yet been made if they will be public or private. in discussions with the developer. They will be public streets. So, does that need to be updated to take the word private off of there as it's a master preliminary plan? It is not recorded. Thank you.

Is that also the one cuz I had heard that is that uh the residential area that is going to be gated? Correct. So, if the developer opts to keep it a public street network, it could not be gated. Oh, okay. I had heard that it I thought it was uh something that they had on the development that they were going to be it was going to be a gated community, but it's not. Well, at this time it's a master preliminary plot. As we get closer to final, they would have to make a formal determination if it's going to be public or private, but as preliminaries and master preliminary is not recorded. It is not memorialized anywhere yet.

Oh, okay. All right. Thank you. Uh, commissioners, any other questions for staff on items two through seven? If not, then I'll go ahead and open up the public comment on um items 2 through 7. If anyone would like to come and speak on these items, please come forward. If not, then I'll go ahead and close the consent public hearing and entertain a motion or further discussion. I just had one other question on item number seven. Um, have they started work on that one yet or they have not yet? Cuz on one part it said they've started, on another part it said they haven't. Yes, they have begun work with the approved public improvements.

Okay. But there's still because what what did we approve before? Just the preliminary plat. Correct. But not uh not any final plats yet. Correct. This is at the the desire of the developer to ask for a time extension. We did explain to them that uh what we like to call belt and suspenders. It's not a requirement. Their plot is still alive as they have a final and approved PIS, but if they so wish to ask for a small time extension, that is at their discretion. Okay. Thank you.

Okay. Any other questions for staff? I'd like to make a motion to um to accept uh the uh the consent agenda as presented. I'll second. I have a motion and a second. All those in favor to approve items 2 through 7 as presented by staff say I. I. I.

All those opposed? Motion passes. Moving on to public hearing discussion. Possible action item C. It's been a while. Sorry. Good. Good evening, uh, chair, commissioners. Ivette Wallace, interim director of development services. Um, this evening, I'll provide an overview of recommended adjustments to the city's trust fund structure and the parallel recommendation to adopt impact fees for water, wastewater, storm water, and roadway infrastructure. Most of you were not here when we brought the impact fees forward, but we're just going to kind of go over both of them again tonight so that way you have the full picture. Uh these recommendations do come from the capital improvement advisory committee uh following several years of studying master planning and review and and for those that may not know and as we get further into this the master plans were adopted by council. So we we have made progress in this this time period. I'd also like to introduce uh the capital improvement advisory committee chair. He's with us tonight Moses Mastagosi. Um he's here to represent the SEAK and answer any specific questions you may have as the chair committee or the the committee chair. My phone's ringing. I'm sorry. All right. So, just a little bit of background, and I'm not going to read off the slides. I'm not that kind of person. So, I prepared some other language. You feel free to read the slides, but beginning in 2019, city council directed staff to reexamine the trust fund system and explore alternative funding for growth related infrastructure. Those of you that have been in this community understand that sometimes those buckets were empty for quite some time and then sometimes they had abundance of funds in it. So we needed to look to see what that balance looked like. Over the next several years, we completed updates to water, wastewater, roadway, and storm water master plans and identified significant capital needs driven by growth. In early 2024, council requested a reassessment of the trust funds to determine whether they could remain solvent under the current structure. They did that after we brought CAK's recommendation forward

to planning commission and then ultimately council uh for adoption. and they wanted us to take a step back, look at the trust fund fees and do a comparison and bring two recommendations forward for consideration. So, the two recommendations that came out of the capital imp uh capital improvement advisory committee that they're recommending that we present to city council are are one for impact fees and one for the trust funds. So, the impact fees are established in state law chapter 395 if if you're not familiar with that. and they're they're were established as a way for new development to fund its potential share of system expansion. They are tied directly to adopt master plans and a 10-year CIP or capital improvement program ensuring fees are based on actual projected growth related improvements. SEAK recommended adoption of impact fees effective October 21st, 2026 with trust funds suns setting at the same time to avoid duplicate charges. The second recommendation also came from SEAK is amending the existing trust fund policy. The trust funds have been in place since 1982 and have reimbursed over $41.5 million in infrastructure, but several structural issues now limit their sustainability. SEAK recommends modernizing the policy to consolidate the current buckets, which is currently four into two, uh, water and wastewater, clarifying reimbursement rules, and eliminating lift station reimbursements. Um, for those of y'all that that have the history, lift stations are very costly and that is a major drain on the current trust fund system. We feel that these changes could bring it to solveny. So, I'm just going to go into impact fees. I'm going go into trust funds and then we'll go into the fees specifically. Just giving you full history again. So, impact impact fees again not reading off the slide. I'm I'm going to tell you that it's a cost of constructing capital improvements of facility expansions including and limited to construction contract price, surveying and engineer fees, land

acquisition cost including land purchases, engineering and financial consultant cost and the capital cost must be included in the 10-year CIP used in the calculation of the impact fee. So we developed the master plans first with the CIPs and so we have those published online and that is that has been published since we adopted them and even before we adopted them but they're out there. It shows you what should be constructed and what that anticipated cost should be. Uh impact fees cannot be used for operations maintenance or replacement. So it's very specific on what you can and can't do. uh trust funds, the system that has been um along for as long as I've been alive, uh is was originated in 1982, was a great year, and we codified that ordinance in 1982 with this and it said, "All fees and charges will be indexed to the August constructed index published in the engineer news record and adjusted September 1st each year." However, that was never implemented. So we adopted it but it wasn't adjusted incrementally over the past 43 years. We should have done that. We should have done that incremental adjustment uh for that. What we did do is a 40% increase incrementally since fiscal year 2020. Um some of y'all are familiar with the fee increase that development services did and in that we did increase the trust fund fees. We did a 10% increase for four years to try to help get us into solveny. However, that still didn't get us where we needed to be. So, what we'll do is talk about some of the adjustments that we feel uh need to be made to the the trust fund here in a bit. So, we're going to go back to impact fees. What did SEAK recommend? Um again, this was brought forward to planning commission already. So, SEAK recommended adoption of impact fees effective October 1, 2026 with trust fund fees suns setting at the same time. I want to point out that there's two different terms used here. One is assessed and one is adopted. Assessed represents the

maximum fee that the city's authorized to charge based on the impact fee study, system capacity needs, and long-term infrastructure planning. Adopted is the approved rate, whatever rate we end up adopting. SEAT gave us a rate that they felt should be the adopted rate, and that's the rate that you're going to see in the adopted column. So, for instance, water is assessed at $1866 per ERU, which is a residential unit, and the adopted rate is recommended at $950. Uh wastewater is 12688 and then it's recommended at 612. Storm water is uh 30.54 per thousand square ft and the recommended is 100 per eru. And then roadway is a 5% max rate but we're recommending zero at this time or I'm sorry is recommending zero at this time. So when we talk trust funds we weren't talking about fees. We weren't talking about amending any fees. What we wanted to do or what we thought would be best in our discussions with SEAK and with SEAK subcommittee is reduce the number of buckets from 4 to two because it leads to a lot of confusion and it leads to moving monies around unnecessarily. So that's going to help with that. We don't have to do as many transfers and the accounting gets much better. The lift stations as discussed earlier when we added those in 2003 this put a strain on the trust fund system as projects were much high dollar in comparison to the water and wastewater line extensions that we previously previously were reimbursing. We felt that moving lift stations to participation agreements would leave additional funds for the originally intended purpose of a trust fund. Um and again 1982 was a long time when this was developed but the intent of the trust fund was for those extensions of water line and wastewater line. If you know if you lived a quarter of a mile away from the wastewater line and you wanted to extend as a resident you could come in and you can apply for reimbursement to extend that line. And so we're just trying to get it back to what the true intent was was with the

the extension of water and wastewater lines. We also the ordinance clearly defined the difference between PRTA and search charges and spoke to PRAS at 25% of search charges to be deposited into one bucket and then 75% into another bucket. That led to a lot of confusion, a lot of how should we assess it? When is it collected? When is it build? A lot of uncertainty. So we looked at the interpretation of PRAA. We've made some changes to that so that way it's more streamlined. It's not subject to differing interpretations. It's clear, crystal clear in the code. And then we're reducing just the amb ambigu ambiguity. I can speak. I I swear it's been a long day. Sorry. Um we're reducing that by cleaning up the language and telling you when we're going to collect. Where do we collect the fees? So search charges are collected when you come in for a tap and prata is collected at final plat only if you meet the prata requirements for collection. One of the other biggest changes is eliminating the use of a design memorandum. So in lie of a design memorandum, we will require full approv uh fully approved public improvement plans. So this helps us reduce amendments. So what we were seeing with design memorandums is it was just it was a a good guesstimate right a good like OPCC if you will. And oftent times we had to come back and make numerous amendments which would lead to more drain on to the trust fund. This gives us more certainty and doesn't allow for as many deviations and changes as you're going through the project. Limiting the extensions. Um, so extensions right now is something that was kind of just granted if you were moving construction along. What does that look like? like was I just moving my equipment from one side of the property to the other side of the property for 5 years and saying I was doing something or were we actually doing something having inspections and there were there were significant delays. So one of the things that we're doing is limiting the the number of

extensions that you can seek and then you have to have a justification and then there's going to be an appeal process. So, if we deny the the time extension, then you would have to appeal to council and they would have to hear that instead of staff making that determination and saying, "Yes, we agree. You know, you haven't been able to move forward for 5 years because of COVID when other developers could." Um, and we just kind of taking us out and providing that clear language that says you have to meet this requirement. Um, or we're not going to grant you the time extension. If you don't care for our recommendation or our decision, you can appeal to council and ultimately they would have the deciding factor. And then one of the other things that that that we really want to do, I'm sorry, not that we really want to do, we are going to do is we're not recommending any fee increases at this time. And there's a reason for that because we don't know what these changes are going to do to the funds. So, what we're we're suggesting and in all of our discussions is that we hold off on reassessing the fees until fiscal year 2028. That's going to give us time to see projects come in, see reimbursements come in with the new rules and regulations, and then we'll make the determination on what those fees should be adjusted to. We know there's probably going to be adjust an adjustment, but what we don't want to do is put a number out there that doesn't align with what we actually need and then we have, you know, buckets that have plenty of money in it. We we this this fund should be kind of remain solvent and doesn't mean that it has to have millions of dollars in it for use, but it should just constantly have the same amount of dollars coming in as the same amount of dollars are coming out right over the course of a year or two years. So, we're going to revisit that in fiscal year 2028. And of course once we do we're going to ensure that we are going to revisit the fees per the uh engineer record August construction index affected October 1st of each year. So more of a certainty that every year we're going to look at it and if adjustments need to be made we'll be up

here at council every budget season to make an adjustment. Um and that's just us wanting to make sure that we don't get into this 40 years from now again. So, I just did a side-by-side comparison of what we currently have today. This really doesn't show you as much as the next slide's going to show you, but it does break it down. As you can see from a commercial, you have a lot and acreage fee. U, one of the things that we are doing now is we're saying that commercial should be charged by the acreage instead of the lot, right? Because sometimes you can have, let's just say, 50 acres and one commercial building. So, paying by the or one lot on that 50 acres. So, paying by the lot isn't really sufficient in the commercial world. So, we said, let's go by acre. And on the residential side, you used to be able to go lot or acreage, whichever was greater. We cleared that language up and also said residential just by the number of lots you have. So no matter your acreage, we're looking at the number of lots. So that helps us kind of get a better estimate of what fees will be actually coming in instead of just looking to see what fees greater and and t choosing the greater fee. And it also helps the developers determine what cost they're going to have upfront. So you'll see that there's the lot acreage fees. Um, we also have sir charges and PR rata fees and we have that for water and wastewater today. Currently there is no storm water fee when it comes to trust funds nor is there a roadway fee. When we're talking impact fees again we have assessed and adopted. We are recommending the adopted. So for water would be $950 per eru. Again 612 for wastewater 100 for storm water and then zero for roadway at this time. And I just did a better comparison here with with some projects. Right. So let's go single family for a second. 48 lots, 9.158 acres. And the assumption on these is that they have to pay the PRAA fees. So that way we can kind of see what that total cost looks like. So if we had a project today is existing with the trust funds and they had to pay Prata fees per

lot, they would be paying 2060.39. With the impact fee adopted recommended rate, they'd be paying 161 uh662. So there's not a huge difference when it comes to the residential side in the difference between our existing trust funds and the the recommended uh impact fees. Actually there's a slight increase because the PRATA is included in this one. We don't always see PRAA but we do see PTA in a lot of the infill development or the areas that already have infrastructure that's not being installed. On the multifamily, you'll see a pretty significant increase. And I will tell you now that the multif family has been paying by that lot versus acreage and not really paying as much into these buckets as the residential developers have been because of the way that we would look at lot or acreage. Um so for us right now if we took today's ordinance the way we have it codified per lot you'd be looking at 62 to 38.92. The impact fees would take that up to $387,000. It's pretty significant. Um, but a commercial has a much greater demand on the system. I mean, if if you have a hundred units in that commercial, you know, one building on a commercial, it's going to have a lot more drawn or water and wastewater system than a single family home would or a 3,000 ft commercial business. So, we looked at all of that when we were looking at these fees and creating them. Um, commercial, we did uh 2.61 acres just to give us a baseline on the trust fund. Right now, it' be 13,024. If we went impact fees, it would be 7810. So there is there is a difference, right? We're looking at the project now. We're not just looking at the use, but we we need we need to know the number of units because we have to be able to determine the actual demand on the system. So what are the key differences between a trust fund and an impact fee? Trust funds are fully local funded solely by developers through lot acreage and PRATA

fees with maximum local control but limit scale scalability. Impact fees blend developer contributions, so there still is a portion they pay, with city participation as required by state statute, and are governed by state law and subject to changes at the state level. Impact fees are directly connected to master plan improvements, ensuring charges correlate to needed capacity expansion, which creates a more standardized and predictable framework. I will also say that if you are building and and seeking reimbursement if there is a master plan you still have to adhere to that master plan. Um the impact fees were designed based on the master plans but even today a developer with the trust fund if there's a master plan has to build to the master plan or amend the master plan. So you still have that component and the master plans are still used. The trust funds allow us the flexibility if there's state changes where we can remain in our system without the impacts of any state changes which is is something to take into consideration as we move this forward. So with all of that said and done and I can go back to any slide and give youall any more history. I I wanted to tell you that in all of the considerations between impact fees and trust funds, after meeting with the subcommittee, after meeting with SEAK, after looking at everything on our own, after looking at the length of the study and how old the data is that developed that fee at this time, the recommendation that we want to pose moving forward is to update the trust fund policy with the uh update the trust fund policy with no fee increase at this time and schedule a revisit of the trust fund fees in 2020. 28 to evaluate solveny and determine if adjustments are necessary. If we get to 2028 or beyond and we see it's not working, we have the master plans, we have the CIPs, we can go back, we can redo the fee, right? The fees are are dated at this point because the data is older and it took us so long to to move them forward. And it's no fault on on

anyone. It's just it's such a lengthy process that by the time we got through the process, the fees are are pretty old right now. Um, so that is going to be our recommendation. Tonight before you though, we're bringing the UDC text amendment with the trust fund changes. Again, the planning commission's already give uh the approval to move the SEAK recommendation forward. We briefed that last year. It went forward to council. Council said, "Go back. Let's let's compare." Um, so tonight the re what y'all are looking at and what you'll be providing your recommendation on solely is the trust fund edits that we're making to the UDC. Um, and again, we're moving both recommendations forward, but I wanted to just come in here and give the full history and not just come in here and say, "Hey, we're amending the trust fund." Um, so that that's the recommendation tonight that we'd be seeking from planning commission.

Okay. And I stand by for any questions. Thank you, Commissioners. We have any questions? Um so one of the biggest questions that I had back when we discussed this uh was how are what's the plan to reconcile the current projects that are in that that are under the trust fund uh program and you know where is that money going to come from to pay off those as we transition.

So that's a that's a good question and I will tell you right now I pulled the actual balance because I know you're probably going to ask me how much money is in there. Let me tell you what that looks like right now. Um, so right now the trust fund in overall in totality is in a deficit of about $1.3 million, which is much better than we were this time last year, right?

Last year we were in much greater. So we were able as a city to to figure those projects out and move them forward. A $1.3 million deficit isn't unreasonable for us to carry because again we we get money into these buckets daily. With every permit, with every plat, there's monies going into that that bucket. So those projects that were sitting and waiting for funds have already been addressed and we address those as a city and now moving forward we're ensuring that projects are well aware before they submit for trust fund reimbursement of where we are when we think we anticipate to have funding where they are in line for funding. Um and again we feel that the adjustments will help them get that reimbursement sooner rather than later.

But you you can't use money collected in impact fees to pay for trust fund projects, right? No. Yeah. No. Um, it's correct. Yes. No, you cannot. So, the the question is is are we going to write a check from the general fund to pay off all these things or what are we what are we doing? So, you're saying if if council decided to move forward with impact fees on in March, May, whenever they decide forward, what will we do to reconcile the projects we've already approved? Correct. So, I'll chime in. So, um, the recommendation that was in front of council,

please state your name. I'm Moses Mastagasi, District Five. I know I don't have to do it, but um so the recommendation that was in front of council that should have gone to council in June of 24 was that there was an 18 mer 18-month healing period basically. So you would be collecting fees and it would take 18 months to actually implement the impact fee process. So that's going to still be the recommendation. And so council ultimately in March 17th decides to go with impact fees. Impact fees still wouldn't come into play until January of 28, right? You're going to wait the 18 months because staff has got to be put together. Processes have to be put together. There's still policies that have to be put together that haven't been done because everything was shelfd when it was taken off the agenda in June of 24. So currently today, what happens when you're a developer, if you're waiting, you wait in line for those funds to come in, the city can take it upon themselves to have the general fund pay it off or they can go through their budgeting process and include it in there, but that's still a determination that's got to be made by the city. Right? So doing these text amendments today only make the trust fund better while all that still in place. So, let's say we go through with impact fees, passing these text amendments, take off another lift station, draining it by 7 million before we get to impact fees, or another, you know, developer that wants to stand in line for fees but never develop the property or develment, which technically puts it in negative because when she gives you that number, the bank account's not negative, but when you have all the projects in Q, the balance is negative. That's the number she's giving you, right? So there's

projects that have been in Q for a year, two years, three years that they just come back and get a extension on, but they actually never develop. So there's the number your your balance is negative where if you started that project, it would reimburse itself in a sense and ultimately you wouldn't be told a negative number as far as ending balance, not what's in the account technically today, right? So, we're hoping that ultimately even if again it's council's decision if you go to impact fees that 18 months you're going to have a period of where you're collecting fees but not necessarily distributing them. That should bring it to solvent before impact fees hit. Now, an impact fee and a trust

Hold on. I want to make sure that I understand this correct. Yep. is the what I heard I bet say was that we're going to address the fee schedule in fiscal fiscal year 28.

So the fee schedule you will not change because it's already been increased by 40% every year or 10% every year for the last four years. But what you're addressing is some of the things that get reimbursed, right? You're addressing lift stations. you're addressing how it gets reimbured and how projects end up getting developed or not developed again. So the technically the trust fund account is not negative but if you have everything in Q and you're dedicating those dollars to pay those off then you have a negative balance but you can't you can't use any monies collected as an impact fee to pay off

and that's why it would take 18 months. That's that was the recommendation previously because we were 7 million in debt at one point and we needed to give the city 18 months time to figure out how to finalize and pay off and allow all the plats that are in Q that are paying into the trust fund to then roll over get developed or or not get time extensions on come back and then be an impact fee fee. So, so to answer your question specifically, um, if council decides to move forward with impact fees, they're going to set that date certain when we'll start going to impact fees. In that interim, the trust fund would still of course be in place because we're not going to move to it until that time, which means the fees that are existing today would still be collected, right? It it may not be any additional projects between now and then, but it would still be collected to fund those projects.

But it's realistic that there's going to be gap funding that's going to need to be identified to pay off those balances. there could easily be yes and and we as a city would have to look into how we're going to do that whether it's through the budget process or through an operating department because it's their asset at the end of the day. We'd have to have those discussions and see what that looks like. I just remember having a lot of conversations about this with Al and um and one of the things that I had challenged Al before everything got, you know, put on a shelf for a minute was, you know, let's find a similar city that went from something similar to impact fees and, you know, learn from their mistakes and, you know, just kind of understand what we're looking at in this transition.

So, no other city had a trust fund. That's the problem.

Yeah. Everybody else had nothing and went to an impact fee. We have what's called a trust fund, but theoretically it's an impact fee, right? It's a similar version, but not governed under state law and state rules. It's governed under the UDC and whatever rules those are. And that's why in 2003, lift stations were added to the process. Now, impact fees do reimburse for lift stations. Impact fees reimburse for almost the identical things trust funds do. difference is on an impact fee you have a study that says this is your growth area and here are the things that qualify within this boundary and that gets updated every 5 years. With the trust fund you have a developer who looks at the master plan and says I want to develop there that pipeline is in the master plan it's oversized it's going to open up a larger area and fees are then collected off of that. So those are primarily the two biggest differences between a trust fund. It's basically a land developerdriven type process because it's where we think growth will go where an impact fee is where a body decided this is where the growth will go and if the growth goes there then they can qualify for this that and the other.

Okay. So, I concur what the 2026 TAMUCC Alumnist of the Year said. Uh, mainly Mike Dice, interum assistant city manager. The main thing is, as Avette pointed out, there's going to be a a a gap of time that collection would actually start for impact fees. And yes, you're correct. Impact fees cannot be used for trust fund reimbursements. During that time, we should based on what we're collecting today and what we're paying out with changes, that gap should be hopefully zero. Um, but then at that point, we would have to cross that bridge if they do adopt it. Again, we support the the changes we feel that uh SEAK and the subcommittee have done. I mean, we've had six years on this. Uh, you know, 30 meetings plus meetings. Uh,

70 I I can't even count anymore. So, uh, I think we we have really at this point, you know, tried to plug every hole that we could see in the plan on either side. Uh, and this should be the best opportunity for the city. But again, there may be a gap, but the way it's it's looking right now, if it were to go, we should have it covered with the changes. Well, I just think it needs to be a surprise trigger date, you know, because I, you know, development certainty does not like surprises.

I know, but a lot of plats have been submitted and, you know, and extensions and stuff have been granted and, you know, there's there's um I I'm just worried that whenever whenever the the ball drops, right, like there's going to be a bill, you know, and and and that's fine. And we just have to have a plan in place on how we're going to pay that bill. That's right.

So, and Commissioner, I I think it won't be as drastic as in other jurisdictions because to so to to to Moses point, we we do have the trust fund. So, so they if they the yes, they can evade the impact fee, but they're going to they're going to jump into the trust fund so that they they're not completely just void where there it went from nothing to impact fees where they did were able to kind of dodge it. They're not completely dodging.

Yeah. No, I I get it. Have you have you guys taken with the the the with this deficit? Have you taken the plats the the the what what is on the books and the in these in what all these delays have taken and projected on what the fees are they're going to be able to cure occur recur bring in by the time that 18month time comes around. So, so we do have that from when we brought the fee forward um last year and we do know those projects. Uh it's the uncertainty of when they'll actually complete the project. That was going to be my question. Can we approach Can we approach these developers and say

and you know what the rule is, but to say we've got to put the you know we got to put our foot down something. this trust fund amendment. Even if council even if council decides to move forward with an impact fee, we would still recommend adjusting the trust fund as is today because it would give us that that teeth, right, to say, hey, you have been sitting on this project for 5 years. You have others that have been waiting in line. They completed their public improvements in 12 months. So, it's it's are you ready now? And if you're not ready now, you have to go to the back of the We have the we we would have the ability to be able to not ex not to approve an extension past that point then, right? If they would come in and try to delay it yet again.

So a plaid extension. So think of it as two. Not every subdivision, not every plaid, not every development qualifies for any reimbursement. So the reimbursement is only for oversized utility lines that weren't put in by the city because this area has been annexed. It's not for stuff within the development more so it's for stuff outside or to allow future developments that are adjacent to be able to be developed. So you're not running parallel lines. So during this time of let's say you have impact fees move forward or don't have impact fees moved forward, you're going to be able to collect more dollars and and not actually release more dollars out because probably 75% of developments in town don't get a um trust fund or an impact fee credit or reimbursement because an impact fee has the same mechanism. a developer will be able to come and say, "I'm developing this area. I'm paying those fees," which is the water and wastewater fee, but I have a 30-inch line to install because there's 5,000 acres behind me that are going to tie into that. They're not responsible to put pay for that 30-inch line. They the the impact view of the trust fund pays the difference for that line so that there's not 12 lines going to that same lift station. They can all tap into one system. And and the problem really and the beauty about what the city did in 2019 and enacted this process, they saw the vision of an impact fee which by state law has changed dramatically. Every legislation, you know, the way you approve it, how fees can be adjusted because sometimes it's weaponized to basically stall grow growth. But what it did for city of Corpus Christi is the city of Corpus Christi didn't have master plans. It didn't have a network system to show you that the roadway is supposed to be this size. It doesn't show you that the pipeline was supposed to go this way. And every every engineer, the 10 of them we have in this

town would say, "This is best for my client." They turn it in, subdivision works, the math works, they go start it, and then the guy next door goes, "Well, how am I supposed to get there?" Right? And they'd have to go through an easement or gut out a line or do something creative or and that's what caused so many problems and still a lot of problems that we've got to fix throughout the city. But now we have those master plans. And this is why it took six years because the first three years was actually getting sewer, water, drainage, and roadway master plans implemented for the whole city. You have every lift station design on the books. Now, the size pumps that are there, the area it's supposed to accept, so tomorrow, if an improvement has to happen, it can happen without TECQ necessarily coming in and putting a billion dollar fine because we overloaded a system or we we undersized a water line or we oversized a street for no reason. I mean, those are the things that now we're all um playing evenly and understanding. So this is why we think the tax amendments will benefit long term and short term. So longterm is is if we stick to trust funds, it's definitely going to change um the time it takes to be reimbursed and not put anything on the taxpayer because this is all developer dollars and even the master plans and the dollars that were spent over the six years were all developer dollars. So the taxpayer hasn't been on the hook for anything. Now, the difference with an impact fee is an impact fee will be paid by a developer, but let's assume the impact fee account has a half a million dollars in it, right? And a developer wants to start something that's on the master plan in the CIP projects in the five-year plan and they go do it and it's a $2 million project. Well, the city's going to have to get those dollars ready through bonds and

different mechanisms to reimburse the developer. And then once those fees are then recollected from that area actually opening up and paying back in when permits are pulled then those that'll pay off the bond. So the that's also the biggest difference here is an a trust fund is a developer fee. An impact fee is a builder fee. So a developer pays this at platting before the lots are on the ground and before there's anybody ever going vertical. An impact fee is on the vertical. So as a developer, I would develop the lots and then the guy comes in and pulls a permit, they would then pay that fee. So that is one of the two biggest differences between a trust fund and an impact fee as well. Just want to clarif when you were talking about staffing up earlier, right? Is this the person the mechanism by determining on who how this fee is going to be assessed and who is going to pay it? Is this going to be determined by the staff that we're staffing up or is this going to be written in stone on

It's already written in stone. It's written in stone. We've already we have draft policies in place. So, we've been working on it so it's not just sitting on the shelf. We we do have that in in line. We would probably utilize our existing staff that currently manages our reimbursement agreements. Of course, we'd have to in teach them this new process, right? We'd have to work with accounting. We'd have to get different buckets in place. we'd have to build that system out, rebuild our system, our collection system today. So that's why we need time um outside of just the policies, we need time to rebuild our um IT infrastructure for it.

Okay. Thank you. Yeah, Trey, just so you know, there's state law that that governs over this entire process, and they have there there's a requirement that they have a committee, the SEAK committee, that um you know, has people from different walks of life, you know, um builders, land developers, um you know, community members. That's state law, too, right? Uh and so and so anytime those fees get adjusted or anything else, it it does not pass go unless it goes through their committee.

Well, it has to go through our committee and now state law changed to where council has to approve it by twothirds vote, not just majority. Yeah. And there was even state law to put moratorum on impact fees even being implemented in cities, but that didn't pass legislation this go around. There's supre supreme court cases that are looking at impact fees because again an impact fee is supposed to be a tool that creates development growth in some areas. It's a tool to deter development growth or create certain type of development which is unequitable. So it's that's why state law has been changing dramatically around it over even over the 18 months that this got shelfd. the the the bottom line is the person that pays for this is the buyer of the lot who whose home it's going to be right. The end user is always

Exactly. So I it sounds like because that was always my biggest concern. It sounds like with these adjustments you've taken care of that so it's really not going to be that much of an impact to the homeowner in comparison to what the original numbers were.

So if if we can bring this to solveny it would pretty much remain the same impact that they have today. Right. because right now the developer still is bearing the cost of the infrastructure. The builder has their cost and of course they put that on the overall cost of the the house and the lot. So it would end up being the same. Now if it were to move to impact fees that could shift. Um of course there there may be some forgiveness but the developer still has to do public infrastructure improvements, right? It may not all be covered and then the builder of course is going to be paying that impact fee. So now the the cost is going to shift potentially from the lot to the price of the permit or the home itself.

Just to add on to that, if you look at what the impact fee is supposed to do, it's supposed to take an area and look at what the development cost as a whole is through the master plan and ultimately put a number to it. And we took a lot of time to look at that number and say this is why it makes sense. It doesn't put a burden on a commercial developer and really an impact fee and we're not a big box retail community. Everybody's a mom and pop. You got, you know, your Takaras. You don't have your Costos and your, you know, your Nordstroms every day being built here. And if you saw the biggest difference in the impact fee versus trust fund, that's where that number is so dramatic and where the collection can be a larger amount. As a committee, what we did is we looked at this in a holistic way and said, "Okay, what makes sense for the city to stay solvent and not put a negative turn or spin on developing this city out the right way through the master plan process, there's communities that we're developing in uh throughout the state that impact fees are north of $30,000 per lot, right? I mean, just imagine what that does to the price of a home in in our community. You can't you can't afford that or you basically are not going to be developing anymore, right? But we're also trying to make sure that none of this falls on the taxpayer and it never has in a sense with the trust fund system. So, if we go to impact fees, we want to make sure it also doesn't. So, what we did as a committee, there's an assessed number and then there's an I don't know the exact word applied number. was the recommended adopted number.

The the recommended adopted number, the the number that impact fees and corpus could go up to is 8,700 and change. As a committee, we put it closer to 1622 when you add the two together or 1562. Sorry, it's been a six-year ride on this thing. Um, but ultimately, there's potential if you go to an impact fee that that number could increase and that our committee would stay together. It's 15 people. It's nine council members. They pick the person that, you know, they want. The city manager picks six people. State law says it's a 60/40 split. And whether it's, you know, normal citizens, and then stakeholders, whether they're land developers, builders, apartment guys, shopping center guys, they're in the real estate realm to keep everything fair and balanced so that tomorrow it's not weaponized, right? to where it's not stopping growth or stalling growth or trying to create um one type of city that's unaffordable maybe for most average people, right? So, that's really what it comes down to. So, I think both of them are great tools. I think what we're doing and what we've done to the trust fund uh UDC has been long overdue. Uh but again, everything is a process here in the city and this is where we're at today with this process and we hope to move it forward with the trust fund amendments and then ultimately let council my council presentation will be two to three hours because I'll start with the very beginning and go through every single process and conversation and thought process on how we got to the finish line. But today, we're trying to give you the shorter version of what would make the trust fund a better tool regardless if we go to impact fees and then also explain to you what we what you guys kind of got the longer version. Not all of y'all because y'all are all

haven't been here uh since that time frame, but uh on why we still recommended an impact fee and at what number we recommended it at at that time. So, and what those parameters were. Again, in 2004, we were here in March of basically two years ago. This was the number and here's the timeline that the city needs to get policies, people, and pro processes. And to Mr. Miller's point, how do we fix the trust fund, meaning make it solvent so it necessarily doesn't fall on the taxpayer? And the developers that are finalizing plats or developing plat ultimately pay their fees and then those that have been in queue to get reimbursed for developments that they had finished uh or that they're going to finish that they are you know uh taken care of by the UDC which is still their right to be um made whole with what they did as far as development. So but our city lacks infrastructure and this is really why we're here. This is really why we push for master plans as a development community. Uh I was pushing for it because you know you hire five different engineers and they have five different ways of getting to the finish line when all you have to do is open the book and it says you're going this way, right? And that that's why the master plan's important. And really any text amendments to the master plan need to be a process that's more refined and it has through CCW public works um storm water to provide a justification whether it's reuse or density changes on why you know they're not going to follow it or want to alter it. They shouldn't be able to just bring you a piece of paper and say, "Hey, you know, I'm just going to do this and it makes sense to my guy and know there's got to be some checks and balances and now having a true master plan and departments that are kind of going through that process uh make a whole lot of difference even when it comes to what gets reimbursed and what get uh goes through the trust fund and and we'll go

through the impact fee if that's adopted. So, okay, hopefully all that makes a lot of sense. Any other questions? Well, I know I've sat in some of those SEAK meetings and they're intense. You guys have done an excellent job on making sure that this thing is lined out. Not only for the developers, the builders, the people, just our community. No, it's for the community. At the end of the day, it's to develop a smarter, more efficient community, which ultimately if you have 12 lines going into the same spot instead of one larger line, imagine the impact that puts on our wastewater system, our water system, our road system. Yeah, it's a domino effect on everyone.

You've got to do it right the first time. And and I applaud, you know, Al and and Mr. Dice uh starting the process and now I bet getting it to the finish line. And you know, we just want to make sure everybody understands it. And ultimately, you know, the developers are going to pay their fair share, the builders are going to pay their fair share, and you know, uh, the community isn't going to be left with an asset that's, you know, going to cause them a lot of issues tomorrow with their rates because we all live here and nobody wants to just pay higher rates just to pay higher rates. But if you have maintenance cost and uh more infrastructure than you really needed to get things developed, well, that's what ends up happening. So,

well, y'all have done a great job on doing this presentation and all the work that you've done in all the what, six years, seven years. Yeah, I've been a part of it since day one. That's a long time. Yep. Any other questions?

I'm just going to make one comment then I'll be done. Um, you know, I trust the committee and I trust the calculations that you've done. I don't see how this is going to fix our issue honestly just because um when you've got lot acreage fees that have that that are currently per on a per lot basis a little bit higher than what's being proposed here and then the same on commercial but the big jump is in multif family. I don't see a whole lot of multif family getting built anytime soon. We just had a we just had a a good amount of multif family over the past two years be and if this change would have been in place it would have been on one corridor. It would have been good.

Yeah. I mean we but what I'm saying is we've kind of missed the boat because right now we've got an abundance of class A space. Um

so we would have loved to bring this to you sooner. We've had these discussions on the UDC uh text amendments uh even before this process for impact fees. Right. We had DS tag. We started working through this process. We could never come up to with a resolution that everyone agreed to. We revisited again and we we sat there daily and we went over it line by line until we came up with stuff that as a community, as the community members representation, as a department that we felt comfortable bringing forward. So, is it going to get us exactly where we need to be just by changing how we assess the fee for lot and acreage? Probably not. But with the other amendments that we're proposing, that's going to help us get there. The limit the elimination of lift stations for trust funds moving to participation is the number one amendment. The me design memorandum is the second and then the extensions would be the third that's going to get us to where we need to be.

Okay. And I'll make you feel a little bit better with the thought process. You going to build an apartment complex? No. No. Well, actually soon, but no. Um the the biggest thing and I'll give you the best example without necessarily going into a whole lot of detail. There's lift stations in this community today that exist that don't have any services on them that have never paid a dollar back into the trust fund. Oh, I know.

And those there's a couple of them that were over, let's just say $8 million between the two of them. So imagine those not being on the the system. We'd be 7 million in the net right now. So that's a huge text amendment. The search charges are a huge text amendment. Two years ago, there was also an amendment on how much reimburstable offsite you can get that was brought to the committee. It was a very small one, but as a text amendment, but a very large one in dollars. So there's been minor things done, but even the 40% jump has been a huge jump as far as the fee collection side, but you need those developments that were on those large uh pipelines or lift stations to, you know, come to fruition so they can pay back into the bucket as designed so that way this thing moves forward the right way.

I completely agree and I know exactly where those are and I know exactly who the developers are, right? But what I'm saying is is I think that this is great. I think that we're late. Um what are we not laid on in corpus? No, I I get it. And I just I'm worried that whenever we go to reassess these fees in 28 that everything's going to shoot through the roof because we're going to be at a deficit because I just don't see any new multifamily here. If we stay with trust funds, remember that this is a first come first serve process.

Oh yeah. And the biggest part of this that's different is let's say somebody comes in and says I'm going to get a million dollars from this project, right? And they put their name in Q. That makes when they come to council and they say how much is the the balance. They don't tell you the balance of the bank account. They tell you the balance because of all the projects in Q. That guy doesn't start. He falls out of Q. That's a big difference in the text amendment that doesn't exist today because there's projects that are going to happen that haven't happened. So it also puts an onus on that developer or person that is a stakeholder with their project to either move forward or come back when they're ready, right? And and even applying for it now is going to it's going to put it in a developer's mind that they shouldn't be applying for something because they've got one extension that they can get, right? So it it it goes back to that process. Now they can still get their plat approved. Their plat and a reimbursement are totally different things. They don't have to go hand in hand.

Yeah. No, I'm I'm totally for it. So, I'm just I'm just just cautionary tale that that the fees may not do what we think they're going to do and away from reviewing it.

So, so Commissioner Miller, if I can clarify. So, uh back to the slide uh with the comparison of impact fees and lot acreage. Right. So, today you're right. We would only charge for one lot for that. Let's just say multif family. So, let's just say it's under 8,000. Let's just put that number out there. And of course, we're proposing it at 40,000. Um I don't want it to be confused with the 387,000 that that would be an impact fee. So if we remain on the trust fund, is there going to be an increase for multif family? Yes. But it's not going to be as significant as the increase would be if we're an impact fee. So we could see 30 to $40,000 more going into the trust fund buckets for a multifamily. We're not going to see, you know, $300,000 more come into a trust fund bucket for a multif family. So, I just wanted to to clarify that portion and then to what Moses stated earlier, the small adjustments that we have made to what's eligible for trust fund have already helped. The 40% increase actually helped. We would have been in a much larger deficit today without those changes. Those changes have really kind of streamlined who can be eligible for reimbursement and now we're just taking it that step further. Is it a bit delayed? Of course. Um, but it's it's now is better than ever.

Yeah. No, I get it. Well, and and the main thing when we talk about delay, we want to be methodical and in the way that we examined it, researched it, and brought it to I mean, this is our second or third goound in presenting to y'all on what we uh have done with the CAG. The main thing is we want to make sure we do it right and we're not having to double back and correct things that may have been wrong. the the proposal that SEAK has done and and proposed today should eliminate that that concern. Uh again, the big ticket items and you know how things are going to be if you you know if you're not shovel ready you go to the end of the line that way the incentive is to get things going. The more people build the more that goes back into the trust fund. So it'll selfgenerate if we force people to develop that are participating with that timeline. So, and all there's a lot of concerns.

All I'm saying is that we would have fixed the world if we'd had done this before co how how does the song go if if we're a fifth get drunk. No, I I get it. And the the best place best time to you know plant a tree is today, right? 10 years ago. Yeah. But uh but anyway, um just you know, I want to make sure that that we understand that we're probably going to be revisiting these fees. Well, is it perfect? No, but at least you guys have done something to try to do something about the problems we've been having all these years.

And I'd like to say about fees, I mean, the department is is we are engaged with our stakeholders on all fees. We don't just randomly say we're going to do a fee whether you like it or not. So, before we would even get to a point of presenting a fee to y'all in and council, we would have that intense engagement way ahead of time. I mean, it took a lot of engagement to get the fees up where they were, but uh if we work with the development community to make that happen, they're more apt to be on board and engaged with us as well. So, uh it's not like we're just going to blindly do it in the middle of the night. Um

so, we say fiscal year 28, which means there's discussion with our stakeholders start the first quarter of 2027 because we have to be prepared to move it forward with our budget, which means that all has to be ready to go to y'all before we even hit budget season. And so, see, I want you to do it in the middle of the night. Well, I mean, I can or you want him to do it in the middle of night. I'm sleeping in the night. I I I want it to be a a hard and fast line, right? You know, because I I just I don't want anybody to take advantage of it. Um, you know, based on a timing, and I know that it's impossible to do that because this has to take 1500 votes and, you know, everything's got to got to go through the process. But um but you know,

you and I both know as soon as an ordinance goes to council and there is a date certain for adoption, people are racing to the finish line. Oh, yeah. It's we're used to it. We're we know we're going to get an influx of of submitts. Now, some people uh try to give us a submitt that's a napkin. And of course, we're going to respectfully decline that. So, it needs to be a complete submitt, but yes, we are we're very well aware of that with any fee increase, with any text amendment. When the tree ordinance came into play, the submitts were I I I couldn't keep up with submitts. Our staff was just drowning because everyone wanted to beat the tree ordinance and planting a tree. So, we're we're used to that. We'll prepare. It was It was What if instead of writing it on a napkin, I write it on a $100 bill?

I would still deny it. Respectfully, respectfully deny it. Then I'd have to report you to the ethics commission. Man, put me in a tricky spot. So, before we get uh planning commission recommendation, I just wanted to tell you what the next steps are. So, we are planning on bringing both items uh not both items, we're planning on bringing the UDC text amendment forward and we're also planning on bringing an item setting a public hearing for an impact fee on March the 17th. On March the 17th, council council will tell us which direction they want to go into. If they want to move forward with an impact fee, then we're going to ask for the trust fund amendments right now while we go forward with the impact fee. If they decide we're not going forward with an impact fee, we'll have them vote on that trust fund amended ordinance and we'll move forward as that is. So that's going to be decided on that date. And again,

we have to have a two-thirds vote for that vote. We do not, but we do have to set a public hearing and the public hearing will be set in the future. So May May the 12th, I think is the date that we decided on. So it won't be heard that day. We would come back if they wanted to do impact fees. So we'd ask them at that time to consider trust fund amendments. Okay.

Okay. Any other questions? If not, uh then I'll go ahead and open up the public hearing on um item uh eight if anyone would like to come and speak on item eight. If not, then I'll go ahead and close the public hearing and uh entertain a motion or other discussion recommendation. Who wants to do it? I make a motion to approve uh item C, excuse me, C8. I'll second. I have a motion and a second. All those in favor say I. I. I.

All those opposed. Motion passes. Thank you'all very much. That was that was really uh interesting and something that is very important. Yes. Very good. Uh moving on to director's report. No report for tonight. None. Okay. Future agenda items? None. And we are adjourned.