City Council - Regular Meeting

Friday, family weekend. So, they're doing I know there's going to be

Have you got Taylor's She's supposed to be bringing this. Yeah, she's supposed to have it to you by this Friday. Okay. And I thought Amy, the stuff that I got from Amy from the

little I'll figure I'm not sure.

Okay, council. You were supposed to One, two, three.

Yes. Stay right here. He disappeared. I was supposed to photoc I was just telling John, well, we're not getting some emails and it's not either intersection. She's saying hi.

Have about five minutes. Unless you tell them. Unless you tell them it to you. You know, it's like snail mail.

You take all your kitchen. changed.

We just moved it. Take us. Yes, sir.

Two minute warning. Two minute warning. One minute.

One minute. So now there you go. It is 6:00. :00 and I call to order the regular city council meeting for the city of Commerce, Texas, September 16, 2025. Please note we do have a quorum present. At this time, I would like to invite Pastor Lance Crump uh of Cross Power Church to join us in a moment of indication. The uh vision at Cross Power Church is to see individuals transformed by the love of Jesus Christ, growing in their faith, and making a positive impact in the world. Cross Power Church is located at 1895 Texas, Highway 24 in Campbell. Sunday morning worship services at 10:45 a.m. and Wednesday night Bible studies at 7 p.m. Pastor Hunt, please join us at the podium and lead us in prayer. Appreciate the honor to be here for the council members and the mayor. I think it's a great thing to have prayer. You know, if there's anything we need today, it's prayer. Let us go to the Lord in prayer. Father, we come before you to

tonight, this evening, just to just to take time to thank you for a city council and a city that still prays, a city that still seeks the face of God. As you said in 2 Chronicles 7:14, if we would humble ourselves and pray and seek your face and turn from our wicked ways, then you would heal our land and hear our prayers from heaven. And Father, I pray today that you would just help us to realize that we're we're in the clash of two kingdoms in the last days that we live in. And it's the the kingdom of light and the kingdom of darkness that you so often warn us about in your word. And Father, I just pray tonight you would help each and every one of us as leaders that we would look beyond party lines, that we would look be beyond skin color, God, and help it to realize that that we're we should only be judged by the content of our character and the way that we handle oursel each and every day and the way that we live our lives. We pray for our country. We pray for Commerce, Texas and the the great the great college that's here, Father, that you would touch each and everyone there, each and everyone here tonight, Father, that you'd help us to to just strive to to be good leaders, Father. And that you would help us to just hide your word in our heart, lest we sin against you each and every day. And Father, you said as we put you first in in our life that you would give us the desires of our heart. You also said when your word goes forth that it will not return void, but it would accomplish that which it was set forth to do. And Father, we pray tonight that in the days that we live in where it seems that darkness is prevailing and that that just as your word said in the last days that people will call good evil and evil good. We're seeing it everywhere. But Father, just help us to realize that you're trying to set up a kingdom that does not fail. You're trying to give those that believe in you and believe in eternal life a home in heaven. Most of all, we thank you for your son, Jesus Christ, that made eternal life possible. And without him, there is no hope. But we thank you tonight that we have hope in your son's name, Jesus Christ. We ask and we pray. Amen.

Amen. Thank you, Pastor. Tonight, we have the honor of uh our pledge being brought by Connie Hail and her grandchildren. Besides being a seventh generation Texan, Mrs. Hail is also a member of the Captain Charles Croxel chapter of the Texas Daughters of the American Revolution. This chapter was chartered in commerce in October 1927, nearly a century ago. Since then, it has remained committed to preserving history, providing education, and instilling patriotism. Please lead us in the pledge tonight. I pledge algiance to the flag of the United States of America and to the republic for which it stands. One nation under God, indivisible with liberty and justice for all.

Honor the Texas flag. I aliance to thee. One state under God one and indivisible. Please stay where you are. On behalf of the City of Commerce, Texas, whereas September 17th, 2025 marks the 238th anniversary of the drafting of the Constitution of the United States of America by the Constitutional Convention. Whereas this Constitution of the United States of America, the guardian of our liberties, embodies the principles of limited government in a republic dedicated to rule by law. And whereas it is the privilege and duty of the American people to accord official recognition to this magnificent document and its memorable anniversary and to the patriotic celebrations which will commemorate the occasion. And whereas public law 84-915 guarantees the issuing of a proclamation each year by the president of the United States of America designated September 17th through the 23rd as constitutional week. Now therefore, I ted by virtue of the authority vested in me as a mayor of the city of commerce do hereby declare the week of September 17th through September 23rd, 2025 as United States Constitution Week. This is in the city of Commerce, Texas, and we urge all citizens to study the Constitution and reflect on the privilege of being an American with all the rights and responsibilities which that privilege involves. We also ask our citizens to reaffirm the principles that the framers of the Constitution intended in 1787 by vigilantly protecting the freedoms guaranteed to us through this guardian of our liberties, remembering that lost rights may never be regained. [Applause]

Thank you very much. Okay, council. Looking at item five now is the presentation to the city council by members of the public. I do have some cards here as I call your name. Please come to the podium. Provide your name and address as you address the council. Please note that please limit your comments to three minutes. I'm going to begin with uh and I'm sorry if I mispronounced any names. Amir, Mr. Amir Raman, please come forward and you can corre correct my pronunciation. Good evening. My name is Amir Rahman. Um landlord over here in this town for over 30 years. The 2024 city tax rate for sulfur springs is 435% versus 0.798% for commerce. That's almost twice the rate for commerce than suffer strains and now we we are facing another tax rate increase in commerce. I want to urge city council to focus on the expense side of the equation and reduce spending rather than trying to squeeze every last drop of uh out of the taxpayers. Self uh pride themsel on being a businessfriendly city and uh it shows

it's like day and night doing business with uh self springs versus commerce. Not only with the tax rate but in the attitude of the Sulfur Springs administration versus commerces. The cost of doing business in commerce is high in many ways. For example, I have a 100-year-old house that has a short hairline crack in the wood siding. Miss Camposen is is staring at that hairline crack, taking pictures at all angles and analyzing it. Is this in the interest of the safety inspections? Citing a few nugget of dry cat food in the back on the back porch, a paper napkin that has blown into the yard. Are these in the interest of safety? These are trivial, insignificant issues and she is failing RSIs for them. I have even been told I can't have a head on the property line. Is that a safety issue too? On another property, she said, "Oh, it looks nice." These are subjective interpretation of Miss Campus. On top of this, she is charging fees left and right. Right or wrong. I never had any issues before with other inspectors on RSI. Several landlords have approached me and said that this is not sustainable. Some may even be ready to sell and get the heck out of commerce. You need to put this on the agenda the landlords and figure out how to do this better. Thank you.

Thank you very much, sir. Appreciate you coming to council. Next card I have is from Mr. Terry Harris. My name is Terry Harris. I live at 1513 Ash and I like to talk about uh rental property inspections as well. Uh the inspection process started I don't know how many years ago but uh Becky was on the council then so you can probably tell us how long it's been but in the beginning uh we were able to uh to make the requirements for the inspections without too much problem. But that is not the case now. It's very difficult and it's very expensive. Uh when the inspection's done, you can pretty much count on spending quite a bit of money for repairs uh that you didn't have to do before. Uh I'm telling you, it's it's pretty pretty rigorous. So, I think uh doing it every year is also a burden. Um, we were doing it when the tenant moved out, but now we've upped it to every year and I don't think that's sustainable for the city as well as us as landlords. I don't think we have the labor available in town to do what is being required. So, I think or I wish I hope y'all would take a step back and give the landlords a little breathing room

here. I think I understand the spirit of it, but I believe we're overstepping quite a bit and right now uh people are pretty much living in fear of this inspection process. So, uh, that's basically what I have to say. Uh, thank you. Thank you, Mr. Harris. Appreciate you coming to council. The next card I have is from Charles Yates.

Hello, I'm Charles Yates. I've had rent property here in commerce since 1975. I never had a problem with my property before. I've always kept it up and tried to keep it up, but uh it started out where I was redoing a house that had been vacant for a long time and I had a heck of a time getting the people out of it. But anyway, I finally got them out and I paid to have the dumpster brought in and we were hauling stuff out with the dumpster. U matter of fact, I think it was just about seven loads it took. It was just, it was just unbelievable. And then one day, this inspector leaves a a note for me that I'm going to get fined for not cleaning up the trash. And I said, "You see that thing right there? It's called a dumpster. I've been loading it up and hauling it off, and now you're telling me I've got to haul off even more when I'm already doing it." You know? I mean, this is ridiculous. So anyway, that's part of the problem right there, I'm sure. But today, I was reading yesterday's Dallas Morning News, and lo and behold, there is a page in there about what we're doing and what Dallas is doing. Same thing, and I saved it, but went off to the house. uh they do inspections every three years. Not only do they do inspections every three years after they have continuous uh good inspections, they don't harass the owners. They have a system to where uh the people living there, if they have a problem, they can report it to the city and the city will uh work with them and

work with the landlord to try to get things repaired. But, uh, basically what's what's happened here now is is everything is out of control. This is just ridiculous. Uh, the lady that does the inspections, she wants people to to paint a board on the outside of the house. Well, my goodness gracious, a board on the outside of the house. Uh, and that's just one one example of what's happening. Uh I think that what we need is we need to have a decent system set up uh to where we can uh work with the city and the city work with us to to build it up and to make it uh it already is a nice town. There's nothing wrong with it. Most of the properties we've been tearing down properties left and right for the last few years. The city's just really gone overboard doing it. Um and and if that needs to be done, it needs to be done, you know. But if we did everything that is being respected or are uh c uh for us to do by the time we pay taxes, insurance, and we're not talking about $200,000 houses. We're talking about everyday houses. Insurance is over $1,000 a year for just a wood frame house. And then you've got your uh insurance on top of that, which is pretty close to it. Uh and then uh you know, we're being told that we have to do this, do that, do this, do that. Well, if we did everything that is expected of us, we can't afford to own any property in

town. It's just un unaffordable. That's all there is to it. But anyway, y'all do a good job of it and straighten it out. Okay.

Thank you, Mr. Yates. Appreciate you coming to council tonight. The next card I have is from uh Miss Alivas. Hello. On behalf of the Student Government Association at East Texas A&M University, we want to strengthen our relations with the city of commerce and our university. We wanted to first start off by introducing ourselves. My name is Stephanie Olivas. I have the honor of serving as the student body president at East Texas A&M University and I'm here with one of our senators, Andrew Collins. and we just want to eventually get on one of the future agendas, but also introduce ourselves to strengthen the relationships between the city of commerce and our university and just be ready for our senators to attend more of these city hall um city council meetings. And that is all. Thank you so much.

We appreciate you coming tonight. Thank you, council. We are now at item number six, our consent agenda. Please take a moment and look over the consent agenda and let me know if you have any questions. There being no questions, may I have a motion? I move that we accept the consent agenda as presented. Second. We have a motion in the second. All in favor say I. I.

Any opposed? I sign. Motion carries. Thank you. Item seven on the agenda is our council comments which provides the opportunity for the city council to address the audience and those online. Council Henry, anything for tonight? I just we're in the middle of bud or at the end of budget season and I just want to just say thank you to staff for all the hard work that you put in on budget. It was uh nailbiting, but thank you. All right, Councilman Miller.

Well, I'll second that. but also we have a couple of agenda items or a couple of events that's coming up. Um, next Saturday is the Bodark Bash and the Bash Dash will be kicking off at 8:00 in front of uh city hall. It's a return of our 5K which has been not around for about 15 years. So, we're excited about that getting started. Make sure everybody is signing up and uh we've ordered t-shirts as of today. uh that starts at 8 and then um after that will be the parade which will start at 9:00. It is uh back to the 80s is the theme of it and they'll everybody will line up at the city park and then come straight through uh downtown first thing. So looking forward to next weekend.

All right. Thank you, Councilman Thompson. Yes. In addition, uh this year the downtown alliance is adding a kid panure for the boat art bash and this is just children that make their own goods. They will sell their goods u and they will be out in here in the grassy area. So that's something in addition to the boar bash. All right. Thank you, Councilman Harris. I feel inadequate because I have nothing to add. Thank you, sir. Uh Mr. Liz, city manager.

Yes. Thank you, mayor. Um, want to thank everyone for coming in uh to make some comments during the the public comment section. I want to provide just some some brief responses. Uh, and then we actually do have a couple of items later on in the agenda where we'll go into more detail. Uh, air, thank you uh for bringing up the information on the tax rates. um as a matter of uh comparison between Commerce and Sulfur Springs uh for the fiscal 25 period that we're in right now and that you referenced the tax rates. Uh Sulfur Springs has a population according to the 2020 census of 15,941 people. And for those 15,941 people, they have a net taxable value in their community of$ 1.4 4 to 1.5 billion of value in which they use to determine the tax rate that's necessary to cover the cost of the services that they provide to those 15,000 people. Comparatively, for the same period of time, the city of commerce has a 2020 population of 9,090, but that does not include the faculty, staff, and students of the university during 6 to nine months of the year when the university is enrolled. So the daily population in commerce while the university is active is between 13 and 14,000 people compared to the 15,000 uh that is present in the city of Sulfur Springs. However, where Sulphur Springs has a net taxable value of $1.5 billion of valuation, the city of commerce has a net taxable value of $618 million of taxable value because 65% of our community is owned by the state of Texas. There is a blessing to have the university and all the resources that they bring. However, there is also a cost to a community to host that uh university. And so the population of

commerce is slightly lower than the city of sulfur springs during university enrollment. However, the city of commerce has to provide all of the same services that the sulfur springs community does with approximately half of the taxable resource base. And so if we have to provide the same services at the same level as Sulphur Springs, but with half of the tax base, the math usually will end up with a tax rate that is higher per $100 of valuation than uh other communities of the cinema population. And so we do put a great deal of effort and we'll talk more uh in in a lot later item about the effort we put into controlling expenses, but we recognize the impact that our tax rate has on all of the property owners in our community, especially those that are in low and fixed income scenarios. Um, but the comparison of Commerce to Sulphur Springs is not completely accurate because we are shackled with some conditions that are significantly different uh than many of our other neighboring communities. Regarding the uh inspection program for rental properties, um we did make a change to that program about a year and a half, two years ago. Uh again, some of it is related to being a college community. Uh for most communities in the state of Texas, uh 65% of the single family structures or single family units in a community would be owner occupied and 45% of those units would be renter occupied in the standard community. Commerce is actually flipped and 65% of our single family units are renter occupied and only 45% of our units are owner occupied. Uh and so Commerce recognizes that there's a significant influence on rental properties uh and tenants in our community. Additionally, many of those community renters are college students that may be living away

from home for the first time ever and being away from mom and dad. And so when you're in a renter tenant relationship, you have less control over the basic life safety system within that rental property. And so the reason and the intent for the inspections is to make sure that the rental properties made available to our community meet a minimum life safety standard. Uh and so for the residential safety inspection or the RSI program, we're looking specifically at matters that speak to life safety issues for those tenants. Um and so prior to our change a couple years ago, uh Mr. Harris, you were correct. Uh the inspection only happened when someone changed the tenant uh for the water account. Uh but we heard feedback from many landlords and property management teams because we're a college town. They would change out tenants multiple times a year and therefore they would have multiple inspections a year, sometimes three to four months after previous inspection. Uh and they wanted to reduce the frequency of inspections. Um and then so we started looking at one annual inspection instead of every time the tenant changed. So for many landlords that reduced the frequency. However, we also found that some landlords were using utility account and keeping it in their name. So they would change tenants multiple times and never trigger an inspection because the utility account never changed names. Uh and so we had rental properties that had not been inspected in 3, four or 5 years because the utility count had never changed. And so we made an adjustment so that we could at least get an annual inspection of those properties rather than once every 3, four, five years. Uh and so the the the need for that change was to reduce the frequency for some landlords

and actually provide more frequency for other landlords and try to meet in the middle. That was the intent. Uh we do recognize that there's some challenges in the implementation of that new program. Uh and so we're working through the logistics of that. Uh we are adding staff uh to our code enforcement program. Uh we had a vacant building inspector position that was not filled and so we're converting that to another full-time code enforcement officer to increase the capacity uh that we've got to perform these inspections in a timely manner. Uh and so uh Amir, to your point, you raised an excellent point about the fees that we charge. Uh that there is a fee to recognize staff time involved in that inspection. Uh and we generally will allow for one um reschedu. And so if we have an inspection scheduled with the tenant or the landlord and that one needs to be rescheduled, we'll reschedu it. However, if we start having multiple reschedules that are consuming staff time, to Mr. Paris's point, we have limited staff. Now, we're spending more and more time with staff for a couple of inspections because of the continued rescheduling. Then, we do have right under the ordinance to issue another fee to recognize that additional staff time, but we're welcome to feedback uh from the council on that program. Lastly, uh Mr. Gates, to your point, uh I think you raised an excellent point. Um during some planning and processes with the city council and members of the community, uh we received a lot of feedback both from elected officials and people attending our meetings that they want us to work on improving the appearance of our community. We agree that we do have a great community uh of people that that care for each other. Um but we received feedback that there are many properties that the appearance of that property has begun to deteriorate over time. Uh, and we do recognize

there's an expenditure required in updating your properties. And so, a property maintenance inspection is different than a residential safety inspection. And so, when we have a property that fails an RSI, that means there's a substantial life safety issue that impacts the tenant. We have a pretty short timeline in which we work with the landlords to try to get those safety issues resolved, but we will work with them understanding those are safety issues and need to be addressed. Property maintenance issues aren't life safety. Sometimes they are aesthetic related like painting a board or two. Um, we will note that in the property maintenance inspection, but we allow much more time uh as long as the landlord is is working with us to correct the property maintenance issues. We do allow a longer time frame because we again recognize there's some expense related to that and it's not necessarily life safety. And so sometimes we get the two confused. There's an RSI safety inspection that is more critical. Then there's a property maintenance that's probably more aesthetic in nature. uh and we allow time to work on that. But again, we're responding to the feedback we received from the community about the appearance. Uh and so uh thank you all for bringing those other excellent points and we welcome the opportunity to review that process. Uh finally, the students that were here and and left, we are so thankful uh for the presence of of students uh even in our meetings. Many times there's a great divide between the campus and the community. Uh, and as I said, a lot of these kids, and I'm I'm sorry, they may not be kids anymore, but I'm 50, so they're kids. Uh, they may be away from mom and dad for the first time in their life uh in a new community with people they don't know, and they may not know what it means to be involved in the community. And we welcome the opportunity uh to interact with the student body uh and

their officers there to improve the relationship between the community and the campus. We want them to feel like commerce is home just as much as they feel like the campus is home. Uh and so improving that relationship mayor is a a great and we've been making efforts and so we're thankful uh that they attended. Uh thank you mayor. Thank you Mr. Lizenbeine. Council item number eight, first and only reading, consideration of an ordinance amending ordinance 2024-09-04, which adopted the fiscal 2024-2025 fiscal year 2025 budget providing for the adoption of amendments to the fiscal year 2025 budget thereto as set forth in exhibit A, providing for an effective date. Miss Campbell, assistant city manager, financial services.

Good evening, mayor and council. Um this is our budget amendment. It will be our final budget amendment for um FY25. Um FY26 goes into effect October 1st. So this is our last chance to get these last few cleanups in. Um I'm just going to go through them really quickly and if you have any questions, please let me know. Um for uh our major funds, uh first we have our general fund. Um, and with our general fund, I'm just highlighting two items um that are kind of unexpected. Um, the first one is going to be in our governmental affairs depart department. Um, specifically contract services. Uh, we need to add $156,000 to that line item and that is specifically for um cons comprehensive plan. um expenses. Uh we don't budget for them. We did not budget for them ahead of time because we weren't sure how much we were going to have in this fiscal year next. It's just like a nice little cleanup. Um now that the comprehensive plan is completed, this should not be an ongoing expense in the 26. And then the other adjustment is going to be in the administrative services specifically in payroll. Um, and this amendment is directly related to the action council took in December for our city manager's pay. Um, because that happened in December, that's 3 months after the budgets adopted. And so I've just been holding on to it until we got to the end.

For the record, I do not make $749,000.

He does not. He does not. There are many other people that fall into that department. Um the other major fund with an adjustment is going to be our public utility fund and specifically that's for our water treatment department. Um and what we need to do is we need to budget for the actual depreciation that happens in the year for $327,000. Um Howdy speaks about this uh numerous times about how depreciation is not an actual cash expense. it is really just our us recording the deterioration of um assets that we already have on the books. And so because of that, we typically do not budget for the depreciation in the water fund. But because at the end of the year, it does affect our fund balance in a way, I like to make sure that at some point we get it accounted for. So that's it for our major funds. Uh the minor funds, these are very typical of the adjustments we make every year and this these truly are just true ups of actual expenses. Uh in fund five that is our capital replacement fund. It is an internal replacement fund. Uh and this is just a true up of the actual expenses. uh we're purchasing new pieces of equipment, uh purchasing uh or having new leases for our enterprise vehicles. We do our best to estimate the cost when we're doing the budget, but we all know as time goes on, you get the real uh prices. And so this is really just a true up of all of the new purchases that we've made throughout the year uh including the effect on depreciation. When we look at uh fund 7 the grant fund

uh we had two active grants in the fiscal year 25 and this is a true up of their expenses in FY25. It is possible there are expenses in prior years but this is true to 25. So first we have the brush grant uh and we have received the new brush truck. Uh we have also received the reimbursement um from the Texas Forestry Service. Uh this is just a true up of what the final invoice was on that brush truck. So we needed an additional 100,000. And then finally the fuel farm. I am recording the fuel farm project in the grant fund and not the airport fund because it is grant related. And what I mean by that is we have an annual grant with text that's called a ramp grant. And that funding is a reimbursement of 9010 for um appropriate um airport expenses. And so we have to spend $110,000 in a fiscal year and we receive a h 100,000 back. So, um, for the last couple of years, as we've been getting fuel farm expenses, I've been going in and getting reimbursed for tech stock. Um, overall, this is the final one, so I wanted to chew up the final expenses. Um, so we need an increase of 90,000 rolling right into the airport. Um, I want to just jump over the fuel and go to transfer out. That 27,000 is the amount that is not covered by the grants that we have spent over the last

few years. Um, so because we have a very healthy fund balance because of sale of land, that's where we're pulling those funds from. Otherwise, our grant fund would be negative and we wouldn't be able to have any more matching funds for new grants going out and we don't want that, right? So, this is just trueing up everything that the grants did not cover and so it's considered a transfer out and it will be a transfer in on the grant fund. Uh we have finally purchased um our first I guess fuel tank of fuel. I don't. Um, and so this is trueing up that expense. We really in the in the budget, we kind of put a placeholder in there. Uh, now that we have actually purchased the fuel, we know how much it is. And so it's an amendment of $31,000 for the fuel. We have had one fuel purchase so far. We're very excited about that for $1560. Um, I will mark that as a win. Um, and so the the main thing is is that they are getting it to function. They are testing. They are doing everything that we can so that we can start having more frequent fuel purchases out at the airport.

I do have a question. Are we utilizing the airport advisory board as we are pricing the fuel for our airport? Because they are experienced pilots and get fuel across the country could offer guidance to us. So the way that we're we have it set up right now um is we have a fuel calculator um which I created using very basic cost project cost analysis right so what we have to be for to cover our overhead what it needs to be to break even if we were going to have a profit and so we go based on that we look at that calculation and then we observe the airports in our area and make sure that um we are not outpricing ourselves and still covering our expenses. And so um in the past I think we were very reliant on the advisory board uh because we didn't have that kind of insight uh but now we have we can look up real time what everybody else is charging and trying to also at the same time make sure that we're covering our costs. If I may, also while we do consult with the advisory board, we also recognize to some extent they're setting the prices for their own fuel for their own airplanes. And so we take their expertise. Uh but we do not give them the ability to set the price because they do kind of have a vested interest in keeping that price low. And so we have to make sure that we are appropriately covering our cost.

Agreed. But please note that the pilots will fly to Sulphur Springs and purchase fuel over there instead of purchasing fuel from commerce because of price. And so that's why we look at the the the region around us to make sure that we're not out of out of line.

Our pricing I want to say mindset is to look at the options. So the calculator kind of gives us three options, right? It's kind of like the lowest that I think that we should kind of go and then like a maximum setting with like a a profit margin of whatever we feel like the profit margin 10% 11%. And then what we do is then we take that and we compare it. And in our goal is to stay under the surrounding cities because we do recognize that um it would be I mean very easy for a plane to just keep on flying like I don't know three more minutes.

Conversely pilots from Suffer Springs and will fly here to purchase air also. And that's the goal. And so we want to be able to we don't want to get stuck in the same situation where I think we were prior to replacing the fuel tank where we were having to continue to supplement the airport and supplement supplement. And so I think that we have found a good medium and and still trying to be um respective of what they what they are wanting and what they need.

Very well. Um, so moving on to the street maintenance fund. Um, I need to increase the budget for 216,200. Well, $216,270. This is just to account for the asphalt zipper. Um, yes, we talked about it during the meeting and we we we approved it. We went through all the right things. I just never had it in that line item for capital purchasing. Um, so this is just adding that in there. um the recreation fund um specifically for basketball. This is something that we've done the last two years uh where we are incurring expenses to pay the referees for basketball um and then what happens is I invoice the boys and girls club at the end of the season and they reimburse us. We have found that works a lot smoother because referees when they come to the game um you know we have them scheduled for x amount of games and so we can kind of plan ahead. We're going through the boys and girls club they have a much more um I guess drawn out process of paying vendors and so this just helps us keep the referees paid at the end of every game or the weekends things like that. So they have already paid the invoice. Uh this is just trueing up the expense. Um and then finally hotel tax fund. This is to account for um the allocated funds to the CLI for the um dash bash dash. Um this is just to true up that expense line to tie out to what you guys wanted to allocate for the extra $1,500. Um, those are all of the amendments that I'll be making if approved.

Any questions for Miss Gamble? There being none, may I have a motion? I'll move to approve the ordinance amending ordinance 2024-9-04, which adopted the fiscal year 2425 budget, providing for the adoption of amendments to the fiscal year 2025 budget. Therefore, as set forth in exhibit A and providing for an effective date. We have a motion and a second. All in favor say I. I.

Any oppose like sign? Motion carries. Thank you. Item number nine, first and only reading, receive a report, conduct a public hearing, and consider action on an ordinance adopting the fiscal year 2025-2026 FY2026 operating budget. Mr. Lisby, city manager. Mayor, Council, thank you. U we have a brief presentation to go over uh some of the highlights of the budget. Um to to Tony and Stephanie's point, this is uh been an ongoing process where we've had multiple meetings and in a lot of workshops where we've been talking about this. And so I don't I don't want to belabor and go through all of the the details that we've covered through the budget process. Uh but I also do want to deliver enough information to the public so they understand uh what we're doing. Uh and so as we build budgets, we typically start uh at a high level and then work down into the weeds. Uh and so uh through the council planning process, uh we adopted the following vision statement that that tries to set a future goal of who we want to be when we grow up. what what do we want commerce to look like so that we're building budgets that move us in the direction uh that the elected officials have given us. And so the statement is simply the city of commerce will be a vibrant self- sustaining community where families can put down roots in the soil and grass of a rural setting, raise their children safely, pursue a quality education, and still have access to the amenities of the DFW Metroplex. And so without dissecting the entire statement, I just want to take a look at that first line. The city of commerce will be a vibrant self- sustaining community. Uh in in the past and and to some degree even in our current situation, uh the health of our community is very much tied to the activity of the university campus. Uh and so we want to begin to move in a

direction in which our community has the ability to be self- sustaining independent of the activities on the campus. Uh we want the activities of the campus to be a blessing and a benefit to our community. Uh but we don't want to be um suffering from changes in the activity of the campus. And so for us to be a self- sustaining community, the community outside of the campus needs to be growing. Uh that means people need to be choosing commerce as a place to live, work and play. Uh and so there needs to be something about our community, the quality of our community uh that people find attractive that they want to choose to come here to live, work or play. And so as we provide the various services within our portfolio, the goal is all the services that we provide in some way move us in the direction of becoming self- sustaining uh so that we're not dependent on the activities of the campus. Additionally, for the staff, our mission statement while we get out of bed each day is we work together to build and maintain a community of the highest quality for present and future generations. And so staff, uh, as we work together and as we work with community partners, we're here to build a community. Uh, I've said it before, uh, and somewhat tongue and cheek, it's easy to build a city. A city is just a place with stuff. Uh, and it is significantly easier to build stuff than it is to build community because community is the relationships. Community is the people that are within that place. And so the goal of staff is not to create a place with stuff, but to help create a community. And so again, the services that we provide need to be structured in a way that we make it convenient and desirable to be a community, to have people that build relationships, and we facilitate that. Finally, as we're putting the budgets together all the way down to the line items, uh we remember that we are a service organization. Uh this city

organization exists to serve. Uh, I've been in communities where unfortunately it seemed that the mentality of of staff was that the community was there to serve them instead of them being there to serve the community. Uh, and so we evaluate each function that we provide, each service that's within this budget and try to make sure that we're raising the level of service that we provide and that we're being responsive to the feedback the community gives us about those services. Secondly, every dollar we spend is someone else's dollar. Uh we have tried to find a way to plant a money tree at the wastewater plant uh and grow our own money, but we have not been successful. And so every dollar in this budget before you, someone else gave us that dollar to use on their behalf. And so we try to exercise a great deal of fiduciary responsibility with every dollar that is in this budget in front of you to make sure that we're spending it on behalf of the public that gave us that dollar and that we're being responsible. And finally, the most valuable thing in this budget is trust. Uh it's it's not the dollars, it's not the equipment. It's seems hard to say, but it's not even the people. The most valuable thing in this budget is the trust of the community that gave us those dollars to use on their behalf. So when we build a budget and then when we implement the budget, everything we do is either building trust with the community or it's eroding trust. And so we look at every line item, every dollar with these three principles in mind. Uh and so the the chart in front of you is looking at the primary government organization. And so that's going to be the general fund and the public utility fund. There are a lot of other minor util minor funds uh that many times are internal in nature but the bulk of the services that we provide directly to citizens uh is this graph that is the

general fund and the public utility fund. Um and so uh at its most basic nature, we exist as a city government to provide public safety, public infrastructure, and quality of life or public health. Those are the three fundamental reasons that local government exists. And so if it's not public safety, public infrastructure or public health or quality of life, we probably shouldn't be doing it. Uh and so every service in this budget fits into one of those three categories or it is an administrative support to the people providing those services. Um no offense to human resources but you might not be able to say human resources is public safety but the people in public safety want to get paid. Therefore we need human resources to support their activities. Uh and so there is uh an overhead uh that is provided and so the the budget that is proposed is 16,224,760.56. Uh within that budget, 29% of that budget is dedicated to public safety activities. 51% of that budget is to public infrastructure. The majority of that, as we'll see later, uh is public utilities. uh then public health and quality of life is 8% uh and support services or administrative overhead is 12% of the budget. When you compare a service organization like the city uh to other nonprofit uh type activities uh an industry standard for administrative overhead is 15 to 25% of their budget should be expended towards administrative overhead. For our organization that's 12%. And so we feel like the administrative overhead is tight uh for an organization our size. Looking specifically at just the general fund. Uh on the right hand side I apologize a lot of numbers here. Uh

trying to summarize it as best we can. On the right hand side are the expenditures associated with the general fund. Now in a general fund uh scenario the services that are provided in this fund are general in nature meaning that it's very hard to send a bill to Bob for his use of the services located within the general fund. 55% of the general fund budget is public safety. Uh majority of that's police and fire. Uh, and so, uh, if citizen Bob is involved in a motor vehicle accident and police resources respond to the scene and fire resources respond to the scene to protect his life, to protect the traffic and the flow of other people, all of those activities that happen in that spot, Citizen Bob directly benefited from those services. But we don't send him a bill for the services that he received because that would be unsustainable and Bob would never be able to pay that bill. And so the cost of providing that service is distributed generally across the entire community so that we all share in the cost of that general service and we all benefit generally from that service. Today I may benefit more because I had a motor vehicle accident, but hopefully tomorrow I don't benefit at all because I don't get an accident and they don't pull me over and they don't write me a ticket. Uh and and so most of the services provided in the general fund are general in nature and it's hard to send an invoice to the user of that service. And so general fund services are usually supported by taxes. Uh and so for the general fund expenditure, 55% of that budget is public safety. Uh 8.1% of the general fund budget is public infrastructure. Uh and that is our street and storm water department. Uh

community services or public health or quality of life is 14.5% of the budget and that's the section at the bottom. And then administrative overhead lives in the general fund. And so it appears to be 22% of the budget, but approximately half of that budget is funded through the public utility fund. Um, and so that 22% uh there's revenue that offsets some of that from the public utility fund because they are providing services to the public utility side as well as the general fund side. For revenues supporting this, uh, again, general fund budgets, $8,572,000. budgeted revenue is $8,62,000. Uh 35% of our revenue comes from taxes. Uh the rest is going to be other uh fees. So within that is the revenue we get from the public utility fund. Uh and then some miscellaneous and other fees, licensing permits to uh to the to the point of what we're charging for residential safety inspections, u other kinds of uh permits for building. 1.3% of our budget uh comes from fees and permits. Uh fines and forfeitures uh the tickets that we write essentially is 0.6% of the revenue in the general fund budget. Uh in our community, we have a philosophy that our courts are not cash registers. Uh and so we don't use our law enforcement and our court system as a revenue generating tool. Uh the goal of public safety is to provide a level of safety and voluntary compliance to our community. uh and so we don't put a revenue burden on that function because it fundamentally changes the way they perform their function if their goal is revenue rather than public safety. Uh and so fines are 0.6% of our revenue. Uh within that taxes of 6,33,000

there's three uh different uh levels of tax that we receive. My apologies uh franchise taxes misspelled. Uh, I I am a numbers guy and so Molly, my uh words lady, corrected me and said that that was misspelled and I failed to correct it before the meeting. So, my apologies. Uh, franchise tax is simply those utilities that operate in our community like the phone company, the cable company, the gas company, and the electric company. Uh, those are all for-profit entities that conduct their business on public land and public right ofway. And so they pay a franchise tax to the community to recognize the fact that they're using public land to conduct their business. Uh franchise tax limits are set by state law. So it's not something that we can then go raise the franchise tax. Uh but it nets about 8.7% of the total tax revenue uh to our community. Sales tax is the economic transactions that happen within our city limits. Uh that's about $1.6 million a year. Um, in comparison, Sulphur Springs sales tax revenue is probably at least three to four times that volume uh in sales tax revenue. And so for our community, uh 64 to 65% of the tax revenue comes uh from property taxes. That's $3.9 million for maintenance and operation. And so as we look at the expense budget and the revenue budget, uh we take the essential services that we provide to the community and the population that lives, works, and plays here and are we providing a level of service that the community is comfortable with. Uh many times we get feedback from the community that they're not satisfied with the level of service that we provide. And so we have to find ways to improve the level of service or the quality of service without necessarily improving the cost of that

service because of the impact it has on our taxpayers. Um next slide. Um when we get to the next item on the tax rate, we'll talk about those expenditures and how that then goes to uh the uh tax rate uh that has been proposed. So mayor, that's the presentation. Uh, we do need a public hearing and I'll be happy to answer any questions. Any questions for Mr. Lisby? Any questions from the council?

There being none, I just a minute, sir. There being no questions from the council, at 6:56, I open the public hearing. Is there anybody in the audience that wishes to come to the podium and address the council? I just have a question about understanding um like whom um uh owner um has I think 140,000 or in that neighborhood uh less taxes or uh uh follow what I'm saying homeowners Um what's the word? Um

deduction or reduction in the the uh homestead exemption. Homestead exemption. Yes. So the state legislature applied that to school taxes and so that's what it's only on the school taxes. Okay. Is that uh reimbured by the state or uh you don't know? I I'm I'm not familiar with how schools calculate their tax rates because the people that do it for a living don't understand it and so All right. All right. I understand struggle with that, but where that money goes, the state can

it's it's my understanding that whatever your assessed value is, if it's a homestead property, they previously reduce that amount by 100,000 and then the schools calculate their revenue requirements. Now they reduce it by 140,000 and then the schools calculate their revenue requirements. So I'm not sure what impact that's going to have on the tax rate. All right. Thank you so much, Chef. Great question. Is there anybody else that wishes to address the council? There being none, at 658, I close the public hearing. Council, we do have a requirement for a roll call vote. May I have a motion? move that we pass an ordinance adopting the fiscal year 2526 fiscal year 26 operating budget as amended.

Second. We have a motion in the second roll call vote. Councilman Henry I. Councilman Muller I. Mayor Real I. Councilman Thompson I. Council Harris I. Motion carries. Thank you. Let me do that.

Yeah. This budget will raise more revenue from property taxes than last year's budget by an amount of $1,965, which is a 3.7% increase from last year's FY25 budget. The property tax revenue to be raised from the new property added to the tax role this year is $111,538. I move to approve an ordinance adopting the fiscal year 2026 budget as presented. Yeah, I guess we need May have a second. Second. We have a second. Roll call vote. Councilman Henry I. Councilman Miller I. Mayor Real I. Councilman Thompson I.

Councilman Ays I. Motion carries. Thank you. Okay. Item 10. First and only reading. Receive a report. Conduct a public hearing and possible action on an ordinance adopting the tax rate of.8306 per $100 of assessed valuation as of January 1st, 2025, fiscal year 2025-2026 or FY26. Mr. Lisby, city manager.

Mayor, council, thank you for the opportunity to present this. Uh again, I have a brief uh presentation discussing the tax rate and how it was determined. Um, and as we just saw, the state of Texas gives us some very specific language uh that we have to use and there's some very specific formulas and calculations that are given to us by the state uh that we don't get to modify or adjust. Uh and so uh each year when the appraisal district gives us the certified value and and so most taxpayers simply want to know how much do I have to pay and there are three primary components of answering that question. The first component is the appraised value and we as a city have absolutely no role and no voice in the appraised value. uh that is determined by the central appraisal district for Hunt County. It's actually a violation of state law for us to participate in the evaluation and setting of of tax values. So we are completely removed from the appraisal of the property. We then adopt the tax rate and the appraisal district has absolutely nothing to do with the tax rate. It's a violation of state law for them to participate in the tax rate. Uh and so the appraisal is independent of the tax rate and the tax rate is independent of the appraisal. You put those two numbers together and that's the answer for the taxpayer. How much do I pay? Uh and so each year the appraisal district gives us a certified tax role that shows the taxable value of our community and then uses that to calculate and the state does the calculation called a no new revenue rate. And so the intent of the no new revenue rate is basically the tax revenue or the tax levy that was generated in the previous budget. If we

hold that value constant and give you the new values of this new year, what is the tax rate necessary to produce the same tax levy or what the citizens have to pay as last year? And so our last year's tax rate was 79 in some digits. The state calculated the new no new revenue rate and it increased to 820323. And so the no new revenue rate is higher in this new year than it was last year because according to the appraisal district, the net taxable value of our community is lower this year than it was last year. That's a number we're given by the appraisal district and we have no say in what that number is. So the appraisal district has determined that the net taxable value of our community has gone down from last year. Therefore the no new revenue rate goes up to generate the same tax levy as the previous year. That no please go back. That calculation is given to us by the state. The second calculation that is given to us by the state is the voter approval rate. And that's basically allowing for a three and a half% increase in the M tax rate uh that the community or the council can adopt without voter approval. And so any tax rate over that 3 and a.5% maintenance and operation requires an election. And so that would be a 868641 tax rate is the voter approval rate. And so based on the revenue requirements of the budget that was proposed, the proposed tax rate is 8306 which is slightly higher than the 820323 uh which is the no new revenue rate. And so as we move on to the next slide, when we look at and I referenced earlier uh

looking at taxable valuations, um I don't know what the certified tax role for Sulfur Springs this year, but in last year uh their certified tax role was $1.478 billion was their certified tax role for last year. Our certified tax role for commerce in this year. Total valuation of everything within the city limits is 1 bill596,813,62. So total valuation of all property within our community is right at 1.6 billion of valuation. However, the brown piece of that chart is all owned by the state of Texas. Next slide. If you remove them from the tax role, then our total assessed value of our community is 721 million794,351. You then take another calculation and remove what is non-t taxable of those. The next slide, our total taxable value is 661,380,695. And so out of a $1.6 6 billion valuation for our community. Approximately 1 billion of that is removed from the equation because it's owned by the state of Texas. So of the remaining net taxable value u almost 55% of that value is residential structures and and that sorry go back one more please that places a significant burden again the general services that we provide to everyone we have to distribute the cost of those general services and 55% of that property tax burden goes to residents not commercial businesses not industries uh it goes to residents and so we're very mindful of the impact that has on the residents

because I'll remind you again our community has about a 35 to 36% poverty rate. Those are residents. Um and so we have to be very mindful of of the impact these budgets have on those those property owners. And so our mission has become vibrant and self- sustaining, which means we have to improve the quality of services that people will choose to live, work, and play here. But we do that with about half of the resources of other communities our size. And so we try to improve quality as much as we can by living within the means that doesn't unnecessarily burden our residents. Molly next. And so what is the impact of the appraisal plus the rate? what do I pay? Uh, and so this again is a chart with a lot of numbers. My apologies, but the tax rate for last budget was 79890979.80 per $100 of valuation. And so the median home value for a residence in our community is a property value of $184,611. Not everybody is going to have a property that's worth $184,000. Uh, so the first column is for every $100,000 of value within your property. Last year for the median home, it's that column with $184,000. Last year, the total city tax to that property was an annual $1,474.87. That's equivalent to $122.91 a month. That was the total city tax to the average residents uh within our community. That does not include school, county, or hospital district. That's just city property tax alone. with the proposed tax rate of 83 cents uh that is

within this budget, that same home that's valued at 184,611. Their total annual tax bill will go up to $1,533.38, which is equivalent to $127.78 per month. So that increase, how much more am I going to have to pay because of this adopted budget? the annual increase for that home is going to be $58.51 a year or equivalent to $4.88 per month. Uh the question if if the question is is $1,533 too much for a residents in Commerce, Texas. Uh then I will simply go back to the comparison between Commerce and Sulfur Springs understanding the difference in total valuation and yes the difference in tax rate. Commerce spends $68,020 of taxes for every citizen in our community. The cap tax per capita for commerce is $68,020. The tax per capita for Sulfur Springs is $92,726. Uh and so the tax per capita in Sulfur Springs is significantly higher than the tax per capita in commerce, but yet our tax rate is higher per cap uh than theirs because of these differences in valuations. And so when we look at the budget changes, did we bring more value in this budget than we brought cost to the average taxpayer? So again, uh these are the state numbers and these are the the this is part of the state language that we have to use in fiscal 26. That's the budget that we've proposed tonight with the tax rate of 8306. That tax levy total maintenance and debt service is 5,513,556.

last year's adjusted tax levy with the tax rate of 7989 that we had for this previous year. That adjusted tax levy is $5,317,11 for a change of an additional $196,545 of additional tax levy in this year over last year. Of that $196,000, $111,000 comes from new development, new construction that didn't exist in our community last year. And so tax increase in the levy for existing properties from last year to current year is an additional $85,7. So the tax levy increase from last year to this year for existing property is an additional 85,000. The other 111 is new construction, new development as our community grows. Thank you, Molly. Next. So, finally, within this budget, here's some improvements to services or new services that we're providing the community in this budget that did not exist in previous years and the annual cost of these services. And so within public safety, uh 10 new patrol vehicles, uh that have been provided to our police department has an annual cost of $80,363. This means unfortunately if one of our citizens has a motor vehicle accident and the police are responding to that call or if we get a call domestic disturbance, police don't have to worry about whether their vehicle is going to run. They just worry about getting to the scene of the need and serving that community. Uh those new vehicles come at an annual cost of $80,000. The new fire engine, this is not the ladder truck. In addition to the ladder truck, we had to put a new engine 3 into service. Uh the annual cost for that new fire engine is $66,353.

So again, when your home is on fire, the fire department doesn't have to worry, is the truck going to run to get us there? They're going to get there and have all the equipment they need to serve you. And the value or the cost of that is 66,000. We replace the entire public safety radio system for all police, fire, and dispatch so that when the call comes in for service, we can radio out all the necessary resources and we can continue to collaborate with the other agencies around us. That radio system has an annual cost of 70,123. And we're improving the forensics tools that our officers have to solve crimes. That's an additional $12,500 within this budget. And so just in public safety alone, these are the annual costs in this budget that didn't exist last year. And our increased property tax levy from existing properties is only $85,000. In parks and recreation, uh we will have a new rec, not a new, but we will have a rec center that we can provide the citizens of our community that we haven't had in decades uh through a partnership with the school district. And that will come with an annual cost of $48,000. And then the community spoke to us about the condition of the baseball fields at Eddie Moore. And so we've completely reconstructed uh and are reconstructing all of the baseball fields at Eddie Moore. And that will have an increased annual maintenance cost of $37,250 a year. So this is just a short list of new services or improved services that we provide to our community that are within the budget that's being presented. and the tax rate that is being proposed will generate an additional $85,000 in tax levy. And so, mayor, we'll be happy to answer any questions. Uh, this does call for a public hearing. Are there any questions from the council for Mr. Lisby?

There being none, at 7:14, I open a public hearing. Is there anybody in the audience that wishes to address the council on this topic? There being none at 7:14, I close the public hearing. Council, this does require a roll call vote. May I have a motion in line with what's on the screen? I move that the property tax rate be increased by the adoption of a tax rate of 0.83600 per $100 of assessed valuation which is effectively a 3.7% increase in the tax rate. Second.

We have a motion and a second. Councilman Henry I. Councilman Mueller I. Mayor Rail I. Councilman Thompson I. Councilman Ays I. Motion carries. Thank you. All right. So, item 11 um first and only reading consideration and possible action of an ordinance ratifying the property tax revenue increase reflected in the fiscal year 2026 operating budget as a result of the city requiring more revenue from property tax than in fiscal year 2025 budget. Mr. Lizby, city manager.

Mayor, council, thank you. Uh, this is a fairly new, I think this be the second year that we've done this exercise. Uh, and it is a transparency uh, move that was made by the state of Texas. Uh, we agree uh, with the need for this transparency and so we're thankful for the opportunity. Uh, and this is simply taking a look at the budget that was presented and adopted, the tax rate that was presented and adopted, and making sure that everybody sees and understands that this budget and tax rate will in fact require an increase in property tax revenue. And the elected officials of our community have to take action to ratify and repeat their understanding of that scenario. Um, and so as we discussed, uh, the budget and the tax rate will present, uh, an additional 196,545 of tax levy, which is a 3.7% increase, uh, from last year's budgeted tax levy. And of that 195, 111,000 change is from new construction and new development that didn't exist. Uh, and so we're just recognizing and ratifying the revenue requirement. And again, as as we put these expense budgets together and we look at all the various revenue that is available to our community, there is a gap between the charges, the fees, the fines, the franchise tax, the sales tax, all the revenue necessary or that we're expecting in that upcoming year. There's a gap between that and the expenditures. And that gap has to be filled with property tax revenue. And that's what's being ratified uh in this action. Any questions for Mr. Lisby? There being none, this does not require a public hearing. May have a motion in accord with what's on the screen.

I move to uh pass the ordinance ratifying the property tax revenue increase reflected in the fiscal year 2026 operating budget as a result of the city requiring more revenue for the property tax than in the fiscal year 2025 budget. Okay, we have a motion and a second council. This does require a roll call vote. Councilman Henry, I. Councilman Miller, I. Mayor Rail, I Councilman Thompson, I. Councilman Ays I.

Motion carries. Thank you. Item 12, adopt FY 2026 capital improvements plan. This is a first and only reading. Receive a report. Conduct a public hearing, discussion, and possible action on an ordinance by the city council of the city of commerce, Texas, accepting the fiscal year 2026 CIP. Mr. Lisby, city manager. Mayor, council, uh each year in addition to the operating budget in which we adopt uh we also adopt a capital expenditure budget uh for those uh major capital expenditures that we anticipate in the upcoming year. And so we've been working on a series of uh capital construction projects and they've been slowly moving forward in time. And so in the fiscal 26 budget uh this CIP we have uh within the general fund uh approximately $2.5 million of funding capacity uh for certificates of obligation. Uh the funding capacity is basically if we take last year's tax rate and we carry that tax rate forward, how much certificate of obligation debt can be incurred without changing the tax rate. Uh, and so the capacity within the general fund for this upcoming period is $2.5 million in funding capacity. And so of that, we're proposing $2 million uh to be allocated to the downtown improvements project. Uh, as you recall, we're currently under design with an engineering team uh to replace um all of the sidewalks, streetscapes, and infrastructure in our downtown area. That is Washington, Maine, and Alamo Street. Uh the current condition of our sidewalks and streetscapes are dismal and in some cases unsafe. Uh and so this project will allow us to completely remove and replace um all sidewalks and

streetscapes in this downtown area. Within fiscal 25, uh we provided $2.5 million of funding towards that project. Uh that included design and anticipated construction. And then uh this will conclude the funding for that project for the final $2 million. So that will be a total of $4.5 million allocated to the construction of our downtown improvements uh that will improve the safety and the appearance of our downtown. Uh within the public utility fund, uh we have got um improvements to our wastewater treatment plant uh that are significant and substantial in nature. We've been talking about that for a while. Uh we anticipate about $6 million uh in construction activity within fiscal 26 uh that will be taking place uh to rehab and restore the capacity of our wastewater treatment plant. And so that would be $2 million on the general fund side, $6 million on the utility fund side for a total capital budget uh for fiscal 26 of $8 million between the general fund and the utility fund. you are not adopting the outlying years. You're only adopting the plan for fiscal 26. However, it is important to see the projects and the needs that are coming uh to us down the road. And so, what we're looking at for future years in terms of funding capacity is basically how many of these problems can we fix without changing the tax rate. And so, that's the calculation. And so assuming that we'll continue to see some development, that we'll continue to see growth in the value of our community outside of the campus, we are conservatively looking at how much capacity do we have to start fixing these problems without changing the tax rate. And so in fiscal 27, we're going to have about $3.5 million of

capacity, but we're only proposing 500,000, which is uh engineering and design for reconstruction of Monroe Street. In fiscal 28, we'll have about $3 million of capacity. We're looking at about $3.5 million of issuance in that year. Uh because we will have under issued in 2027. So we still feel there will be no impact to the tax rate. that is the construction on Monroe and the design for beginning improvements on charity. In fiscal 29, we've got approximately $3 million of capacity and we're proposing $3 million of debt issuance. Uh $2.5 million for construction on charity and $500,000 to finish design for the other half of charity. And then in fiscal 30, we'll have approximately $3 million of capacity. and we're proposing $2 and a half million dollars of certificate debt uh to finish construction of the charity improvements. Uh and then in the public utility side, uh the big project we have right now is improvements to the wastewater treatment plant. But moving beyond that, we anticipate the need to make improvements to groundwater storage tanks for the water treatment and the pump station at approximately 2 and a.5 million. Um then as we do construction for Charity Lane, we anticipate replacing underground utilities to the tune of about a million dollars. And the completion of Charity Lane, probably another million dollars of underground utilities that will need to be replaced as we reconstruct and expand Charity Lane. And so that's taking a look at the next five years of capital projects that are anticipated uh in the general fund and the utility fund. But reminder, you're only adopting fiscal 26 as the current CIP plan.

Are there any questions for Mr. Misy? This does require a uh public hearing. So, at 7:23, I open the public hearing. Is there anybody in the audience that wishes to address the council? There being none, at 7:23, I close the public hearing. Council, this does not require a roll call vote. So, may I have a motion, please? May make a motion that we adopt an ordinance accepting the fiscal year 2026 capital improvement plan on the first and only reading.

Second. We have a motion and a second. All in favor say I. I. Any oppose? like saying motion carries. Thank you. Item 13, uh, first reading, conduct a public hearing, discussion and possible action on an ordinance for a conditional use permit by Kendall Stanhouse for Stanhouse Automotive allowing for an auto repair garage for the property located at 2307 Live Oak Street, Commerce, Texas. Property ID 23159 legal description AO219 Kurland William Track 7 acres 1.996 general business district Mr. Harper, community community development director.

Good evening. Um, what was not in your packets was the minutes from the planning and zoning meeting. They met September 10th, which was last Wednesday. Uh, the turnaround was a little bit too much, but uh to to get it in that packet. Um, but we did meet uh last last Wednesday and uh they they heard this case. And uh in in the general business district, auto repair garage use requires a conditional use permit. Um so when we looked at this location and in the use that they proposed, as you can see right there on your on your screen, um there is nothing south of it. It's a land or university land. Bending Keith is a noticeable noticeable building up there in the uh north east corner of that uh picture. Um and that's a text dot highway as well. And as you can see, there's there's some screening around there just with the existing storage units, but staff and the planning and zoning commission did not see any reason for conditions for this location. Um P and Z recommended approval. U four in favor. There's only four members in attendance, but four in favor and none against.

Are there any questions from Mr. Harter? Um, one of the things that we were talking about in the past is, um, some of our businesses having the ability, I mean, is there a way that there's a fence at Do we talk about a fence? Do we talk about anything that, you know, we have other auto shops that have cars that are out on the streets and everything else? Is there enough space for what they're looking for? Was that addressed? And then also about how it's going to look. Okay. Appearance-wise. Well, if you're building materials, appearance-wise, we can't restrict that.

No, I'm talking about, you know, the different cars, what stage they are, how they're going to be set up, and everything else. Well, that can be added as one of the conditions as a a screening option for storage of vehicles. We as a council can add that condition. Okay. And they'll have two bays with the two garages that are present in that building. I presume as of now the if the zoning isn't approved then there's no point in moving forward with building permits or or uh building modifications. Is it in the plan to use any of that storage area? No, not as not as not as of right now. So you're talking about the self storage on the back?

The self storage on the back and on the east side. I don't believe so. No. So, is that going to continue being used as storage or anybody using an app? The I think I believe the applicants here if you can answer that as well, but yes, we'd like to hear from any other questions for Mr. Harper. If the applicant is in the audience and would please come to the podium. I guess the applicant is not here.

Okay. Well, then never mind that. Okay. This does require a public hearing. So, at 7:28, I open the public hearing. Is there anybody in the audience that wishes to address the council on this topic? There being none at 7:28, I close the public hearing. Okay.

May I have a motion? I move that we pass an ordinance for the conditional use permit by Kendall uh Stanhouse for this uh for Stanhouse Automotive allowing for an automo auto repairs garage for property located at 2307 Live Oak Street with the condition that there is a fencing or something around it that will keep to to improve the appearance And to thank you very much to improve the appearance. So you're talking about street a fence in the front of the building on live oak.

There has to be what I'm looking for is something that will keep the you know the cartridges not always just sitting out there in the front of building or that are in disar or enduring different parts of their um so to make sure that we understand because we'll bring this back with second reading with these adjustments. Are you adding a condition of a fence or a solid fence for visibility screening? Those are two different things. Solid fence. A solid fence for visibility. Okay. Does council clear on the motion? I hope so. If so, may I have a second? Second.

We have a motion and a second. All in favor say I. I. Any oppose like sign? Motion carries. Thank you. Item 14, first reading, conduct a public hearing discussion and possible action on an ordinance authorizing a reszoning application by Deuce Young for Joyfulness Property and Holdings LLC for a change from general business to A2 apartment dwelling district 2 for the property located Highway 24, Commerce, Texas. Property ID 36218, legal description A1033, Thompson Cat Track 32, Acres 2.29. 29. Mr. Harper, community development director.

Council, this resoning request was also heard on the same day, last Wednesday, September 10th. Um, as you can see right there, everything south is the mobile home park that currently exists. Um, and the the property owner owns that as well. He's looking to extend his mobile home park north um into that triangle area right up there to to the north. Um, the the the the important thing is on this is this when it comes into the planning portion of it, the civil engineering that's going to dictate how much can actually go into that area. Um during the PNZ meeting, the uh property owner was optimist his optimistic number for the number of mobile homes in that area was I think 10 to 12. Um PNZ did recommend approval of the reszone in this area. It does not trigger based on the location. it doesn't trigger anything in the mobile home park ordinance in chapter 58 um that would require existing residential structures and whatnot. Um but staff recommended approval as well.

Are there any questions for Mr. Parker?

I'm just curious what this is where the red square is. What's all that? That's his existing just just buildings. I guess it just looks I think that's just part of the software actually. The red square is a software. I'm not worried about the square. I'm worried about what all this buildings and such are. I'm just curious. Okay. He'll be here. Okay.

Any questions for Mr. Harper? There being none, at 7:32 I open the public hearing. Is there anybody in the audience that wishes to address the council? There being none, at 7:32, I close the public hearing. May I have a motion? I move that we accept the uh possible action on an ordinance authorizing a reszoning application by Deuce Young for joyfulness policy and Holdings LLC for a change from GB general business to A2 apartment dwelling district 2 for the property located at highway 24 Commerce Texas 75428. Uh Okay.

Second. We have a motion and second on first reading. On the first reading. All in favor say I. I.

Any oppose like sign? Motion carries. Thank you. Item 15, second reading, an ordinance of the city of Commerce, Texas, amending the city of com, excuse me, amending the city of Commerce, Texas code of ordinances, chapter 90, traffic and vehicles, article 5, stopping, sanding, and parking. Division one generally sections 90-101 A2 traffic parking system maps unauthorized parking subsection 90-101 A2 traffic parking map adopted and chapter 90 traffic and vehicles article 5 stopping standing and parking division 1 generally sections 90-101 traffic parking systems map unauthorized parking subsection 90-101 A3 traffic no parking map adopted prohibited the following area west side of Manga Street beginning at Aldridge page turn and continuing north on the west side of Mango Street to Maple Street, providing for a penalty for a violation of chapter 90 as a class C misdemeanor and a fine in an amount not to exceed 500 $500, providing that this ordinance shall be cumulative, repealing all ordinances to the extent they are in conflict, providing for a severability clause, providing for a publication of an effective date. Mr. Felicity, city manager.

You may take a drink of tea if you need. I think I will.

Um, throughout our community, we have a number of of streets uh that when they were developed and when the subdivisions were put in, uh, the streets may have had an appropriate width at the time those subdivisions were developed. Uh but moving forward in time as we look at uh the changes in automobiles and as well as the changes in the size of public safety and first responder vehicles, a number of our local residential streets are too narrow to allow for two lanes of traffic plus vehicles parking on both sides of the street. And so as we encounter those areas or as we get requests from citizens within those areas, uh we have the option in the practice of designating one side of that street as no parking. Uh this would allow parking on one side of the street and still have enough width uh for first responders to get safely through uh while there's traffic flow. And so for this stretch as you see on the screen of Mangum Street uh from Aldridge to Maple uh the requests from homeowners in that area and based on the evaluation of our first responders, we're recommending that the west side of Mangum Street be designated as no parking. Uh this will allow us to add it to these ordinances uh and put up signs designating that. Uh we'll be happy to answer any questions.

Any questions for Mr. Lizzy? There being none, may I have a motion? Motion on second reading. Second. We have a motion in a second. All in favor say I. I.

Any opposed? Like sign. Motion carries. Thank you. Um item 16, late hours alcohol permit. This is the second reading. Discussion and possible action on an ordinance of the city of Commerce, Texas, authorizing the extended hours for alcohol sales for current and future eligible holders of retail late hours certificate in the city of Commerce Texas providing for a penalty providing for severability and providing for publication and an effective date. Mr. Lizby, city manager.

Mayor Council, this is the second reading of this ordinance. Uh when we had the first reading in a previous meeting, uh council indicated that they uh would approve uh this ordinance, but they wanted to make sure that there was a sunset clause uh so that it would be reviewed uh within 2 years. And so the version of the ordinance that you have before you uh continues the authorization uh for local establishments to serve alcohol to 2:00 a.m. in the morning. So, the ex the previous hour was midnight and this extended it to 2 am. And then within each 2-year time period, uh we observe the data. We talk with our first responders uh to see if we're seeing any adverse impact to the community of those extended hours. At this current time, uh there are only two entities that are taking advantage of this. Uh and in each one, one day of the week, they stay open till 1:00 a.m. instead of midnight. And so, um, staff has recommended, uh, approval to continue this. Uh, council asked for a two-year sunset clause, and that is in this version, and we submitted for second reading. Any questions for Mr. Lisby? [Music]

There being none, may I have a motion? I move that we pass the late night hours alcohol permit on the second reading. Second. We have a motion in the second. All in favor say I. Any opposed like sign. Okay, we have a motion carries. Thank you very much.

Item 17, second reading, discussion of possible action on an ordinance amending ordinance 2024-10-03 to reflect modified city of commerce water and wastewater rates for FY2026. Mr. Lisby, city manager. Mayor, council, as part of our adoption of the budget each year, we re-evaluate uh the charges for service in our public utility fund. Um I just want to briefly um recommunicate that on the general fund, those general services are provided to the community and the the the cost, if you will, are recovered through taxes. Uh and the role of a tax is simply to generate revenue. Uh and so you look at the revenue requirement for that fund and then you assess taxes sufficient to raise the revenue necessary uh to make that fund uh stay in the black if you will. And so the key point is that taxes are not tied directly to the cost of a service. On the public utility side there are no taxes supporting that fund. And so it is only fees and charges for service that exist. And in those fees and in those rates, they are tied directly to the cost of service. And the amount of service used by the customer directly determines the bill they pay for that service. In this case, specifically, water and wastewater services. And so we are recommending uh a minor adjustment uh to the water and wastewater rate uh within this uh utility fund. And so for residential customers uh on the water side uh we still have what we call the lifeline rate which is the first 4,000 gallons of consumption for single family residential structures. Within that the determination uh is that basic household needs for water that are essential for life and health uh is within 4,000 gallons. And so for that first 4,000

gallons for residential customers, we actually charge a rate that's lower than our variable cost of production. Uh we have a discount for that first 4,000 gallons of water because we recognize that it is essential. And 35% of our households live under the poverty rate. And so we want to maintain and protect the utility bill for the first 4,000 gallons for our residential customers. And so their charge is $4 for every,000 gallons. And so in essence, we deliver a,000 gallons to their home when they turn on the faucet and it'll cost them $4 for that,000 gallons of water. Significantly cheaper than going to the convenience store and buying a 20 oz bottle of water for $2. Um, but then as you use more water, the cost goes up to recognize uh that as you use more water, you're placing more demand on the utility. And so therefore that cost goes up. Uh multif family, commercial, and industrial accounts do not get that 4,000 lifeline uh rate. Uh and so those charges reflect our available cost of production uh for each of those. Uh and then the wholesale water contracts, uh those rates are adjusted each year by contract. Uh and so it's a little bit different calculation uh than our retail customers. Um on the sewer side, uh same thing for residential customers. The first 4,000 gallons of water is protected at that lifeline rate of $4. Uh 5,000 to 10,000 gallons is is a higher charge for sewer, but residential customers, we cap the sewer charge at 10,000 gallons. So any consumption over 10,000 gallons does not incur a sewer charge. This allows us to generate the revenue necessary to cover the cost of sewer services while recognizing in most residential applications, water in excess of 10,000 gallons is probably not going down the sewer. It's probably an

exterior uh use outside. So there's no sewer charge for those. Commercial and industrial customers, there is no way to determine how much goes inside and how much goes outside. uh and so all consumption for commercial uh applications is charged uh this rate for sewer. So the impact of this rate change as you look at on the next screen what is the the cost of water. Again I apologize a lot of numbers on this screen but for residential customers 67% of our households never exceed 4,000 gallons a month. So 2third of our household use 4,000 gallons a month or less. And so their current bill is $80 a month for both water and sewer combined. This new rate will be $82. So, that's a $2 a month increase for twothirds of the residential customers of our community. That's a 3% increase. Uh 28% of our residential customers use 10,000 gallons or less. Uh and so most of our residential customers live within that 10,000galon limit uh for both water and sewer calculations. And again, they'll see a 3% increase in their bill. Uh for commercial applications, uh 58% of our commercial users stay within that 4,000 gallons of consumption. Mostly those are going to be convenient stores and office uh establishments that just don't use a lot of water. Uh but then you've got uh other commercials that use 25,000 gallons or a few that use 125,000 gallons. So again, their bills will also see approximately a 3% increase for water and sewer. And finally, the uh industrial uh customer, average customer uses 425,000 gallons a month. Uh and so their bill will also go up approximately 3%. Uh and so this uh rate adjustment uh will impact the bills that customers pay

for water and sewer approximately 3%. So I'll be happy to answer any questions. Any questions for Mr. Lisby? This is a second reading. Uh may I have a motion? I move that we uh adopt the action on ordinance amending uh ordinance 24103 to reflect modified city of commerce water and wastewater rates for 2026. Second. We have a motion and second. All in favor say I. I.

Any oppose? Like sign. Motion carries. Item 18, solid waste fees. This is a second reading discussion of possible action on an ordinance amending ordinance 2024-10-02 to reflect modified city of commerce solid waste fees. Miss Campbell, assistant city manager, financial services.

Good evening, mayor and council. So, we have had no changes to the fee schedule that we brought you uh previously. Um this is just to correlate with the requested fee increase from city sanitation. I know that um Howdy has been working on the contract with city uh city sanitation and that will come to at a later point but this is just to kind of get ahead of that. Um uh and once again the residential rate uh for everyday pickup is not changing. This is mainly for dumpsters uh large collections things like that. um they requested a two and a half percent increase and so our rates are shifting about the same two and a half.

Any questions for Miss Campbell? There being none, may I have a motion? Motion we pass on second reading. Second. We have a motion and second. All in favor say I. I. Any oppose like sign? Motion carries. Thank you. Item 19, CD manager report. Mr. Lizard. Mayor, I invite uh Miss Campbell up for the finance update.

Okay. So, as we're wrapping up the fiscal year, we're looking at August 2025. Property tax revenue has reached 99 and a half% of our budgeted revenue. Uh we do have one month left. We typically do not get a whole lot in uh September, but I do think that we'll hit our budgeted numbers. Delinquent and outstanding taxes have reached 43% collections this year. Um, looking at sales tax, sales tax as of August 2025 has reached 1.5 million in revenue. That's around 95% of our budget. Um, August was a very positive month uh across the board. Uh when we look at our top 10 categories, uh nothing uh really kind of stood out. Um and when we look at I'm just going to keep rolling. When we look at retail, um the retail split comparative to August of 2024 is very similar. There were no large anomalies in retail. Um everything kind of followed the same trend as we were expecting it to. When we look at uh accommodation and food services, uh we'll notice that August compared to last month or last year to this year, uh this year's a little higher. And the main reason behind that is at this time last year, we had a vendor that had kind of fallen off um and were not making their payments. If you'll remember, we ended up having to go all the way to the comproller to start getting those payments started again. um that vendor has since started making their payments again. So that's the big reason why August is is higher than it was last year. When we look at the forecast, um I will give you a little bit of an

insight. With only one month left, I just received the September payment um yesterday and we will meet our sales tax budget. Um, I don't have all of the details yet because it's just the preliminary. Here's what we're depositing into your bank account. Um, I have to request all of the other reports um through open records with the state comproller, but we will hit our budgeted numbers um for FY25.

Thank you. Good evening, mayor and council and citizens of commerce. As a reminder, our weekend, we have switched to weekend hours for our splash park as we wind down the season. Um, our last weekend hours will be the weekend of Bodark Bash and then in October we will close for the season. The library has a lot of events coming up for the fall. They asked that I share this with you all. um it's on their social media as well, but this year for the first time they're doing a pumpkin patch from October 12th through the 31st. Um so they'll have pumpkin cells there and some events where you can do pumpkin carving with the kiddos and story times and some photo booths. They'll also be doing their annual book sale during the Bodark Bash, which they do every year during the bash. They have an art show coming up on September 27th as well. And they have the Jazz Age Jubilee, which is their second annual, I believe, Gayla. um and a primary fundraiser for our public library. So using that QR code, you can purchase tickets. You can also um get the link on the Commerce Public Library Facebook page. We have some flyers on our doors here at city hall. Come up to city hall. We can help you get tickets as well for their second annual fundraiser. Our farmers market season is also winding down. They run from May through September. So our last farmers market weekend will also be the weekend of Bodark Bash. So, be sure this weekend come out and visit the farmers market while you're making a trip to the bash. For clean commerce campaign, we have our section B pickup on Wednesday, September 24th. As a reminder, you can put items curbside as soon as this coming weekend for pickup on next Wednesday, September 24th, if you live in section B. Miss Stephanie talked earlier about our Bodark um Bodark Bash and the Bodark Parade. The Bodark Bash is also hosting

their 35th annual golf tournament this coming weekend on September 19th. Um, so if you haven't already registered now, you can register at commerce-chamber.com or again come to city hall and we can help with that as well. On Tuesday, October 7th, our commerce police and fire departments are presenting National Night Out. Uh, you may be used to that out at Centennial Park. They've moved it this year to City Park to incorporate the splash park into their event. So hopefully you can spread the news and join us at City Park on Tuesday, October 7th. That whole event will run from about 5 to 8:00 p.m. And that's all I have.

Mayor, council, I thank you for uh your attention. It has been somewhat of a marathon and a meeting with a lot of data and a lot of numbers. Uh, and I am going to take just a few more moments and exercise a little bit of executive privilege. Uh, this is probably going to get me in trouble because she's going to absolutely hate this. Um, but one of the important things for any local government and community is the ability to communicate and deliver information uh to the community that's timely, that's accurate, and that's presented well. uh and our very own Miss Mason uh has been an incredibly valuable asset to our team. Uh and so we have been thankful for her services. Uh when she graduated with her undergraduate degree, we kind of winced and figured that she would probably be moving on and leaving us. Uh and we talked her into staying and getting her master's degree. And we assumed that would give us at least another two years of her services. And lo and behold, she completed her master's degree in one year. Uh and so uh she has notified us that she is moving on to pursue some opportunities. There may or may not be a young man involved uh in this decision to move on as well. And so we are going to be uh sorely short staff and we're going to miss her skill and her talent and her ability uh to put timely, accurate, and attractive communications out to our community. and it's going to be very hard to replace her. And so we're very thankful uh for Mason Services. Uh and sorry, sorry, sorry to see her go. [Applause] I have no other updates and we have no need for executive session. There being no need for executive session, may I have a motion to adjurnn. So

move second. All in favor say I. I. Any oppose? Like saying? Motion carries. We are adjourned at 7:53.