City Council - workshop

Mayor. I mean, that way it's self sustained.

Right? So We'll

call

to order the May 17 March I'm sorry. March 17, Dearborn City Council workshop. Did anyone sign up to speak?

No, sir.

Moving on to agenda item number one, the presentation of the fiscal year twenty four-twenty five annual audit by Crowe LLP.

Well, evening. My name is Stephanie Harris. I served as the city's engagement partner this year. It's my pleasure to be here this evening to go over the audit results for 2025. And let's see here.

All right here we go. Just as a refresher, auditors responsibilities when it comes to the audit process our goal at the end of the the end of the engagement is to express an opinion on the financial statements. In order to do that, we make a assess a risk of material misstatement or said another way, we evaluate where is the greatest risk that an error could make it all the way through to the financial statements. In order to make that risk assessment, have to gather an understanding and test some of your internal controls over the financial reporting process. And then from that, we follow a risk based approach.

Typically, the audit is divided into three phases. Phase one being interim before year end. Phase two, final field work at the city has closed its books and phase three for reporting and completion. In terms of management's responsibility they are responsible for the financial statement preparation and presentation however you have engaged us to perform a non audit service to assist the city in the preparation of those financial statements. The city's also management is responsible for federal and state compliance as well as establishing and maintaining effective internal controls.

There were several new GASB accounting standards. The first one was GASB 101 that is reflected in your 2025 annual report regarding compensated absences. Previously this long term liability would have truly been based on what benefits are paid upon separation. Now it is what benefits that are provided whether or not they're paid upon separation that may be used in the future. So things like sick time.

The second one was statement 102, certain risk disclosures. This is required when you have any concentrations with regards to revenue risk or expenditures related to the financial statements. This had no material impact. In terms of corrected and uncorrected misstatements, there were no corrected misstatements. Not to say that we didn't have adjustments but those were just provided as part of the non audit service.

We did have one waived adjustment which related to a liability for the sales tax that was remitted in error to the city. Other required communications there were no difficulties with management, no disagreements, no consultations with other accountants, and no significant or adverse events that would require your attention at the city council level. We did conduct a federal single audit that threshold has been raised it used to be 750,000 it's now a million dollars. You did exceed that for the twenty twenty five year you had approximately 2,500,000.0 in federal grant expenditures. We tested the disaster grant public assistance related to hurricane barrel and that had approximately just over $1,000,000 in expenditures for twenty four-twenty five.

In terms of what you want to hear from me, very pleased to say that we are issuing a clean unmodified opinion on the city's financial statements. Again, unmodified being the highest level assurance we can provide as your independent auditor that the financial statements are materially correct and that all disclosures required were included this also does include the single audit based on our testing of that disaster public assistance grant we have issued an unmodified opinion on the city's compliance In terms of just financial highlights for the year, these are going to be some full accrual numbers from your statement and net position. At the end of the year, you had approximately 448,500,000.0 in total assets. That does represent a net increase over twenty twenty four of 18,900,000.0. You saw a reduction in current assets and an increase in capital assets which resulted in the net increase.

Again, the decrease in current assets was related to

the

expenditure up for capital outlay and investment in your long term assets. You ended the year with total liabilities of just over 212,800,000.0. This does represent a net decrease of 2,600,000.0. Your total liabilities saw a decrease in long term debt as well as pension and OPEB liabilities. You had a positive overall ending net position of 234,200,000.0.

This is for both your governmental and business type activities. This did represent an increase over 2024 of 17,900,000.0 or approximately 8%. In terms of your general fund and again the general fund is often looked at in terms of your fund level statements because the dollars that are usually represented there are not restricted for other purposes. You ended the year with a fund balance of 54,800,000.0. Again, a positive increase over the prior year of 2,600,000.0 or 5%.

That total fund balance of 54,800,000.0 represents a 107% of the city's twenty twenty five operating expenditures. Again, one of the benchmarks that is often looked at for the overall health of the city would be that you had a minimum fund balance of 25%. So you're well over that benchmark and looking great. Your unassigned fund balance also represents 97% of your twenty twenty five operating expenditures. We had no audit findings in the form of material weaknesses or significant deficiencies that were identified in the 2025 audit.

In conclusion, the financial statements are presented fairly in all material respects. There were no material audit adjustments for errors. There were no findings with respect to the financial statement audit or the single audit also known as a uniform guidance audit. Management and staff were prepared for our audit and responded timely to our request. That concludes my remarks. I'd be happy to take any questions.

Comments, questions?

Thank you.

You didn't give them anything to comment on. All

good. Vanessa did a good Mayor

and counsel, if I could just add and brag on our finance team. Type of discipline and procedures and protocol and controls that we have to have in place to be able to make that a reality cannot be understated and that can't be left unsaid. We have a fantastic team that works hard every day to make sure that things like that occur. And Nicole mentioned earlier today to our finance committee to have met that deadline in addition to completing the single audit at the same time was to say that was a massive undertaking is an understatement. And so that's a testament to everything that the city does, everything that council does.

But it's a huge, huge kudos to our finance team. And so, thank you all for making sure that that stays our reality.

I'm just curious how long does the audit process take? I know from a corporate world it could take a while. Is it weeks months?

It's weeks generally. Interim work is anywhere from one to two weeks before your end. And then final field work tends to spread out based on receipt of the information and performing procedures anywhere between four and six weeks.

Okay. Good job.

Anything else? Thank you.

Thank you.

Agenda item number two, discussion of issues relating to potential design options for the existing court and theater building and the old Park Station Number 1.

Do you have them there since you got updated ones?

I do. The updated ones I do. Yes, ma'am.

Okay. I'll pass it back

to you. Okay. Well, good evening. I think when we last spoke, we had presented some designs and budgets for renovating the existing the old Fire Station 1 into a black box theater. And at the time, we had decided to go back to Studio Red to do some further research to find out what if we didn't utilize the Fire Station 1 and get an extension off the existing building. And we demoed the Fire Station 1 into parking. So we did that. And I think we did that. And we sent that through. And we continued to work through some other things.

There were some items in there that we felt were still unnecessary. So we took the demo and transferred that into the existing renovations. And we eliminated some other AV equipment we felt didn't need to be that, the things that we could definitely do in house for significantly cheaper. So with that, basically that's what we have here that I wanted to present. So all this is pretty much the same.

I won't we discussed this last time and this is in the packet. But this is an extension from the existing facility. Anything in the pink there is renovating after the court vacates. And the yellow is new construction. There's a couple seating plans of the Black Box Theater.

This is a view from the outside, a view from Center Street with the extension there on the left side and opportunities to promote upcoming shows and performances, which brings us to a cost estimate. The new construction of a new black box would be just under $4,000,000 Site work total, that's adding surveying and parking lot and site work around the area. We use total construction cost of 5.6 plus some contingencies. 7% might be a little high, but that's kind of how they what they estimated, which is with the total overall budget with all the contingencies and other expenses at around $7,000,000 Susan's here as well to answer any questions you guys might have. As you know, we've been exploring opportunities and some options for a while when we first met with them.

Classes at the theater were overflowing. She's doing classes in the hallways, classes in her office. And we're at the point where we're growing now where if we don't find alternative space, then we'll be turning people away, which Susan has been amazing at trying to avoid to do. So, this is what we came up with. So, I just wanted to present that to counsel. And if you have any questions.

Were you able to, by some of the changes you made, were you able to give more space as far as the students and performance space?

Yeah. So, basically, the changes we made didn't take anything away. It just eliminated some things that we felt we didn't need to cut costs a little bit. But the new this is basically the performance space, the black box theater or the performance theater area. That was existing, so that hadn't changed. So we made sure that we kept that in because that's probably the two main things are the performance The storage, space and

yes, storage is true.

Yeah. Storage is So, those were the two main things that we tried

Does to this

have storage? Where is that located?

Yes, sir. So as you could see, see all the storage there in the top left. The whole left side is storage and restrooms.

So

that's all new build if we go new build?

Correct. Everything in yellow is new construction that's extension off of the

So if that doesn't happen, then there's

no storage related for the old renovation part, correct?

Correct. If that doesn't happen, then we'll continue to operate as is. We'll get what we will do is we'll gain the additional rehearsal hall, as you see in the pink. The pink is

MICHAEL It's more additional.

Is the existing renovations to the existing facility. That's the area that the court is vacating That says rehearsal hall in the pink.

Oh, okay.

So that, we will be able to use that area for some programming space. I got you. Which we are excited about.

So this is the kind. Yeah. I was looking at that. I got you too. You

want to go over some of the cost of just renovating the existing building?

Yes, sir. So this is to renovate the existing renovations, about 1.3. And then you see the cost for demoing in the new parking lot where the old fire station was, total of 1.6. Adding some contingencies and some other design service fees, that total would come right at $2,000,000.

So, back up. Yes, ma'am. Demo the parking lot is going to be how much? Almost

200,000. This is just the parking lot where the where the court sit, where the old old fire station sits.

But the demoing is 80 That's

the demo.

Yeah.

Yes, ma'am.

And what is it going to be to construct a new parking lot?

It's a new parking lot. That's part of the new construction. That was about 1,600,000.0. That was in the that's part of this site work total here, the 1.7. That's part of the so basically the 1.7 in the site work total, that's pretty much everything that's in the yellow here.

Okay. And we don't have a comparison of what you showed us before. So how much does this take away? Does this how much did the cost go down by making these changes?

Okay. So the original we originally came in about 10,000,000 to $12,000,000 And then we came back and did some changes. And the one that just recently did a couple weeks ago that was part of the original packet was about $1,600,000 higher. So that was about $8,600,000 And now we're at $7,000,000 So the most recent one went from 8.6 to 7. The one that we presented about a couple months ago, that was about 10. So went from 10 to 8.6 to 7.

Just so I'm clear, $7,000,000 is not including the two to renovate, correct?

Correct. The 7,000,000 is the new construction. Yes, that one Yes, sir.

It'd be 9 to do it all, basically.

To do everything. To do the new construction and the demo and the parking lot and the old yes.

And the numbers you previously saw, those were blended together.

Yeah, right.

Kenny, can I ask a clarification question? Can you go back to the last page that showed just the rental of the current building? Okay. The 87 for the demo was to demo old fire station, but the 202,000 for the new parking lot isn't that

That's parking the parking lot.

Where Fire Station one currently sits?

Correct.

Okay. So, this that collective 300,000 does include putting paving concrete there to put parking. Okay.

Correct it

does. So what you were just talking about is the rest of the parking lot on the back part.

Correct.

Okay. Okay.

Yes.

Thank you.

Part of the site work total, it also includes like materials testing and surveying and all the

other things

that come with

That's a new part.

With overall site work, yes sir.

We have to have

Funding wise, to do like what are the choices?

I think if we we've broken into two separate projects

very

deliberately. We have enough available funding, as you just heard from the audit, to pay cash to renovate the existing building. What you have in front of you right there, that number. We do not have enough money available to pay cash for a new black box theater. Let's call it $7,000,000 And with that, council cannot issue COs to do that.

That would require general obligation debt. So we'd have to put that before the voters. So that's one of the questions that we need to know moving forward is what direction we want to go. If we want to go in that direction, then we would hire Studio Red to design everything. And this is just preliminary to get more serious about it.

And then we would, by January, have everything ready and have a definite cost and then have counsel put that on the ballot in May 2027 to let our voters say yes or no to that. We'd obviously bring in John and Jonathan and talk about all these ways to keep the tax rate the same and those types of things that we've done in the past. But if we're going to go forward with the black box, we're gonna have to borrow money, and the and the motorist gonna have to approve that.

So I have a question with the type b money. How all the other projects, how many years out are we spending that? Are we gonna have money available in two years in Part B? Or we're not going to have any money available for twenty years? Where are we with that? Because I know So it's it's kind

of two different pieces to that. One is how long are we servicing the debt to pay for that billing. And then two, what kind of M and O costs are needing to transfer over each year? The debt, do you remember? I think we have another twenty seven years or so on that debt.

It's twenty So twenty year debt's about eighteen more years. And then M and O this year, we're moving 1,250,000.00 over. And we're still kind of waiting to see. The next very much in its infancy in terms of I mean, you saw pro form a that we set the rates on last summer. But exactly how many members and how's it going to work and what kind of revenue we're going to make off of programming and that type of thing, we don't have a lot of track record just yet. But so it might require a little bit more shifted over.

The only thing that I worry about is just given the last couple of years that bonds have gone other places and not passed. And with us having just built practically every building in town knew how that is going Yeah. To So that's the only I don't think there's anybody against it per se, but it's just the business funding part of it. And I don't know that that is smart. I don't think the timing's right, basically. I'm not.

I understand that. I think I was more just asking, have we spent all of our type B on everything else, and we aren't going to have anything left for twenty years? We couldn't do this in five years, we're done. I mean, we're already planning on all the money we've made from diabetes for other things,

right, other projects. You could always go out, like five years from now or whenever. Try to do That's right.

Well, the sales tax have admit it's not guaranteed, but it tends to grow every year. Exactly. Tend to grow, but that's not guaranteed.

There's certainly possibility that after a few years of the DAC operating, and we actually have somebody. Yeah. Have some a really good projection of what supplementation, if any, that that facility is gonna need and things like that. There may be some availability in CDC. I don't I don't think right now that's something we could reasonably estimate, but it's possible. It's definitely possible.

And we've as you all know, we've gone to that funding source to pay for a lot of side projects, especially in this budget. And at budget time each year, Parks and Rec has lots and lots of needs and lots of plans. And we have the capital improvement plan. There may be some other things that come up renovations at the adult softball complex, for example that could be a source as opposed to if we want to look at TAP B funding anything at the Court Theater Building or a new black box, well, we'd have to really reshape a lot of things.

So we don't really have an alternate way to go about it.

So what do you need from us tonight? Just direction?

I think we do. If it's to the point where we think that we want to move in the direction of putting it on the ballot, even though May 2027 is fourteen months away, a lot of things have to happen over the next eight or nine months to get ready to have it to be on the ballot. And we need to get studio ready for one now.

And also, if I could just add, if you all recall, as part of the last budget process, one of the things that staff did was prepare a five year CIP plan. And that included projects that were cash funded and some were debt funded as well. And we had our financial advisor at that time look at our bond capacity and all of that and we've the projects were prioritized based on need. And so if this were to be approved and go, we would have to reshuffle some of that, which is certainly doable. Just as an FYI, we would have to we would be coming back to you with a revised CIP plan. Some of that those priorities would shift to make sure that this could be accommodated.

I don't know much about this, but I've been kind reading this. Mean, municipalities are really having a hard time with this. Is that

With debt bond elections?

Yeah. Well, I'll give a and whatever risk to myself, I'll give an editorial opinion about some things. I mean, the state of Texas is making it harder and harder to run a municipality or a county or a school district. And I'm very confident that's going to become more and more difficult as the years go ahead. I don't know how this would go on a ballot.

None of us can predict that. I know there's a lot of love and support for the theater. No question about that. In terms of how that was presented by the right folks and sold, you know, I think it's the kind of decision that a school board would have to face of school boards ever would face. Did we build, for example, a new athletic facility? That's a tough one. Some of those passed. Some of them failed. Or a new administration building. A lot of them don't even call them administration buildings, because that's not going to pass on a bond.

But as opposed to building a new elementary school that's replacing one that's 75 years old, that's more meat and potatoes. The other one's seen as more excessive. In the region, just speaking facts not to bias them, just giving facts we saw in November in Baytown and I don't know the politics of Baytown. I don't know the dynamics of Baytown. But they voted down just because there was not an appetite for new taxes.

They voted down park projects. They voted down street projects at Garth Road Expansion. They voted down drainage projects. You don't see a lot of drainage projects voted down in Harris County. In Friendswood ISD, that's not terribly far from here. That's an ISD. Don't know the politics of Friendswood. Don't know the politics of Friendswood ISD. But we've had a lot of discussion about this. It's kind of at a more global level.

But over there, the voters there voted down everything that was put before them. And that even included, as silly as it sounds to me, refinancing some of their debt. They were so against new debt that when school district said, hypothetically, let's take a 9% car loan and make it a 7% car loan and save the money, the voters still said, no, that's debt. We don't want that. So to some extent, that's the climate we're in.

And I think that probably needs to be and if you all we don't have to make a final decision tonight on this by any means. But before too long before we do this, we've got to get going on it. But where does this way relative to internally to Deer Park, to drainage, to streets, to other more let's call it meat and potatoes things. We don't have a lot of buildings, vertical buildings, left to build. This would be one of the final ones.

But the other things that the city does that are going to require debt and being smart about when you take on that debt and do what it takes to sustain the same tax rate, This is competing against that. And so that's another question, I think, for counsel and for all of us is, even if this would be a slammed up to pass, is that $7,000,000 if the city only has x amount of capacity to borrow money, is that the best use of $7,000,000 that the voters would approve for a project? Is this the best? Is the street project the best? Is drainage the best? That type of thing.

If you tack that on to say if you tacked it on the election, what's the additional cost to even do that?

The election cost themselves? Yeah,

mean, there an additional to

add Angela would have to answer that. But I wouldn't think it'd be it'd be part of it. It'd But the city's be when the mayor and the positions one, two, and three are up next year anyway.

We would only have in that particular case, you would have additional publishing. But the costs would be minimal because we're going to either hold an election for mayor one, two and three next year. And if we do, then that will be a general election. And then we would have the other two at the same time same ballot. So your costs are not going to be any more or less if I hold one election, if I hold three elections. The only difference is just publications. I have to publish more in the newspaper than I do for a general election. I

just I think that the theater gets a short end of the stick year after year after year. I mean you just sorry I just think the theater gets a short end of the stick year after year after year. And you just mentioned this would be one of the last vertical buildings.

We jinxed over it.

I mean, I understand the climate. And it's a risk to put it on the ballot. But mean, the renovation, sure. The black box, I'd be willing to put it on the ballot. But that's me.

I think we need to do what we need to do to get this done. Susan, how long has the theater been here? What year?

Can you come to the max, Susan?

The

building was Eight. In 1987 is when this building was. We started at Room 6 in 1979 at the community center. And that's where we are. But grateful for the renovations to the theater. Just know that, that the existing building and we can make work whatever we need to make work. Trust me.

Thank you.

Just think Step on costume. I think it's important. Think Rehearse. When I think George Ann and I were, I think, the first and second patrons of the theater. And I've worked in the theater. I worked in the 'thirty six. We did re I know what it's not just the theater for the city of Deer Park. It's what it's done for the some of the children in this community. It's really it's it's a place for them to find themselves. Mhmm. They're and it's important. It's important to continue this. And I think when push comes to shove, I think you're gonna see a lot of people who understand that and realize that and be willing to do that. I think it's important.

Yeah, I agree. I mean, what you do with the kids year in year out and then you know the productions and all that, it's definitely worth it. How many patrons do you average yearly? Annually? Annually?

Are on the patron list?

Yep.

Boy, thanks. I did not have that number.

Sorry. Hundreds?

No, that's okay. No, it's it's Oh, it's hundreds. Yeah. It's hundreds.

And some of them are by couple. We sell

at least, we've got at least a thousand that prepay. Yep. To see a minimum, I want to say about 1,200.

Okay.

1,200. That doesn't include the number of people that come to the shows. But it's just having a space for the kids. With adding to the courts, we've got that rehearsal hall, which is about the size of the stage now. And we're prepared to use that area. So we're going to make whatever work. And I know that am I allowed to say anything or I'll just answer the questions? I'm sorry.

Just go for it. Just go.

Susan, what would you Susan, like what do you think? What do you think, Susan?

No. What do you think?

That I know that it's it's very risky going out for a vote. And if it can wait, then I'm perfectly fine with that. And I appreciate I know that everyone that is in this room supports what we do. I know that for a fact. And I know that when decisions are tough, especially financial ones, you know, the city deserves a lot of things. You have to look at a lot of things. You have to juggle a lot of things. We're okay. We are okay. We'll figure it out.

Storage is a problem, but we'll figure it out. And I know the climate is very risky. Like Jay said, it's very risky to take things out to the public. And I know without a doubt that God will provide whatever we need. And if it's later, it's later. It's later. And it's okay. But just even renovating the existing space is going to be such a blessing. And we will be able to use that. We will use it. And we use other spaces. So it's okay. I just want everyone to know that.

I want it

to be more than okay. That's the

way I think.

So win or lose

No,

we don't

want to stand out over costumes every year.

Win or lose in May '27, we can still do the renovation. Is that right? We can do the renovation. We can cash flow the renovation. Absolutely.

And I agree with you. Like everybody is for it. For sure, my only biggest fear of it is the timing. I'm a big timing person. And I just don't know the timing.

They say no. They say no.

Well, let me

If we don't separate the renovation from the ballot and create space, and

it

fails, we're going to get a large backlash from the public of why we're spending money on that building. We clearly need to separate this and do the renovation. '27 is the next session. And the governor's got the cities in his bull's eye.

We know that.

They're going to make it as hard as possible. And I don't want to risk the renovation when we clearly have the money. Because if it gets voted down, people are still going to say, well, why are you spending money on that deal if we put that on the ballot? We have to create space between the renovation and then pick this up this time next year and start looking for the following year and get through that next session.

That makes sense too.

Without the

parking lot, do we

have to do the parking lot?

Yeah, that definitely

have to do the parking lot? I mean, is that something

Well, I think the parking lot makes is part of that $1,600,000 Yes. What are you going to do if you tear that building down? Just have nothing there? It needs to be parking. We don't have enough parking over there as it is. That's not that much money.

Yeah, that's only a couple $100,000. I would recommend parking for the theater.

That parking needs to go in no matter what we do.

Make the baseball page work.

My personal opinion is we move forward with renovating and doing that.

I think we need to create space between the renovation and putting this on the ballot. If anything, I think it will earn us some kind of merit with the community that we've invested cash reserves in this building. We fixed it up. And this is the next phase of what we want to do.

I think as long as they understand that this is not the end of it. I I don't think we

should say we're doing it. No one no one has said this gonna be the end of it. It needs to be done in a phase. Phase one, phase two narrative.

So are you saying if we don't put it on '27, you'd willing to say we're going to put it on the next election?

I I would say what I said a minute ago. We should pick it up this time next year after we get the renovations done and get through the majority of the session and see what that's going to look like. Some of the stuff coming out of Austin right now is not good.

I'm open to that.

I just don't see that the theater needs the parking lot. Mean, maybe baseball needs the parking lot. The court needs the parking lot. The court needs the parking lot, but not to put it in with the theater renovations to say that's part of the money they have to spend.

Well, you're talking about $200,000 I mean Yeah.

Well, I mean, I we'll the I think we'd all agree the current fire station one needs to come down. Yes. Yeah. So that's a question of do you put grass back or do you pave it?

No. It needs to be paved. You pave it.

I think you

That's not even up for debate.

No. It's gotta be paved.

It needs to be paving. It needs to be parking

for all of the above.

No. I agree. I'm just saying is that something that that can be put off to do some other thing, to add some other thing?

Well, there again, if

you demo that, then you're just going to

have dirt there and you have

to landscape, but then you're going to have to mow and maintain it. Why not put parking?

That's probably true in the long run.

That's what I would suggest. We need to separate this into phase one, phase two, and move forward where this time next year, once we're done with the renovation, bring it back up and really look at what the climate is going to be. There's a good chance the ISD is going to have a big bond proposition possibly in 'twenty seven. We don't want this on the ballot at the same time.

They do it every year. They

run up a big bond proposition.

I forgot about

Probably they always do.

Well, do them about every five to seven years.

That's why the time changed.

So what I'm hearing us and staff are crystal clear here is we're going to go back to Studio Red. And we're going to say, we are moving full steam ahead with renovating the current building. We want to hire you to do all the architectural work and design work for that purpose. And we will, between budgeting for next year or amending the current budget, what we need to do, we're moving steam ahead to get that done expeditiously. And then we're also telling Studio Red, after that is done, presumably about this time next year, we're going to revisit the whole matter to talk about do we now, as a phase two, look at a second feature, which is the black box theater, with the goal of potentially, if we do move forward with it, having it

on

the May 2028 ballot. Is that what I'm hearing?

That's what I would suggest. That's what I agree with.

I think that's what we have to do.

You good with that?

Absolutely. Thank you.

We got our marching orders. Right. No. Thank you. That's what

we need.

Thank you very much.

Agenda item number three, discussion of issues relating to charter review process and charter review committee.

Mayor, I'm going to turn this over to Angela.

Thank you very much, Mr. Stokes. As counsel is aware, the we're gonna be discussing the creation of a charter review committee and a proposed timeline for the reviews process. This is one of our key focus areas of of our leadership, the governance strategic goal. Strategy number one is to establish a system for regular review of our city charter.

So what we're suggesting is to formulate a charter review committee to have each council member appoint one resident of Deer Park to the committee. And then the city staff would also be part of the committee, be the city manager, the assistant city manager, the city attorney, and the city secretary. And then at our April 7 meeting, a resolution can be passed with those committee appointees and that we would ask for a term of two years that would cover both the twenty twenty seven election and the twenty twenty eight election. And you don't have to worry about having to reappoint people next year if we need to extend this to 2028. So when you have that Charter Review Committee, our proposed timeline for the actual review process would be, obviously, today is our workshop.

April 7, we would create the committee. And then the months of May through September, the committee meetings would be scheduled and they would review the sections at each each meeting would review a particular section. The committee would choose their chair at their first meeting. And then on November the third council meeting, the committee chair would provide the written recommendation to council. And then council can provide any recommendations that they would like for their changes.

And during the months of November and December, counsel would determine what actions would needed to be taken on the recommendations, whether they have their own, whether they accept the chairs, the committees, and or if there's no changes whatsoever. And then if an election occur, would call the special election January February 2027 and that we would hold the election in May 2027. Some of the other cities that we reviewed, City Of Alvin, they've got seven residents on their committee and they reappoint them every fourth year. The city of League City, not less once not less than once every two years following an election, they amend their charter. The city of La Porte has a mandatory review for at least ten years, every ten years.

So when when we one of the suggestions would be on the charter amendment would be the creation of the review committee so that we would have an established process going forward of how long you all would like the review to be done.

How long has it been since our first review?

I believe our last one was done in 2018 approximately. Was right before you all moved into this building, if my memory serves. Anybody have any questions? So we would just ask that you all would come back with a person. If you could send that to Mr. I think

we just want to answer your question further. I think we did do it maybe in '21

or so.

'21, okay.

We did one in this building. We we changed the whole deal about how the employees have the automatic appeal thing. We checked. That was in this building.

Was before

my was before my time. Yeah. Yeah. But the main thing, if y'all look are good with this, if we don't have another council meeting for three weeks from tonight, but over the next, say, week and a half, you each get to name someone, have it obviously be someone that lives inside the city limits and is willing to give of their time and just tell the three of us, me and Angela and Sarah, who you want to name, and we'll just take action along with the next meeting.

Are these going to be evening or daytime meetings?

I would imagine they would be evening meetings. They were in the past. But if y'all name seven people that are willing to meet during the day, we can meet during the day.

I just was curious.

Or late afternoon.

I guess we could ask them, what can you meet? Would give us an idea of what time we would find someone. If you can only meet during the day, that may be a problem.

Yeah, we want to accommodate whoever you all ask. We will accommodate whoever you all ask.

We're good?

Yes, sir.

Agenda item number four, discuss some issues relating to the quarterly financial report for the fiscal year twenty five-twenty six, first quarter ending 12/31/2025.

Good evening, mayor and council. Tonight, I'm presenting the quarter one financial report for fiscal year twenty six. This is for activity through December 31. We'll start off with some highlights. Our first highlight is that 49% of the general fund's budgeted revenue has been collected by the end of the quarter. This is on target for this time of the year. We typically receive about half of our property tax revenue by December and the other half in January. When comparing our property tax collections to our levy, we've collected about 45%, which again is on target for this time of the year. Our second highlight is our industrial district revenue. 98.5% of our IDA revenue has been received compared to what we billed.

This year our billing totaled 14,460,000.00 which is a slight decrease from last year which we received 14,930,000.00. We collected nearly all of our IDA bills by December 31 which was the due date. In comparison to our budget we've collected a 101 of our IDA budget revenue we budgeted 14,100,000.0. And then our last highlight is our expenditures our expenditures are trending on target for this time of the year with we've realized 22% of our budget for the first quarter with another 18 encumbered 25% is kind of a soft target for each quarter so we're right on target with that We'll go on to property taxes. So in quarter one we've collected 28,900,000.0 in property tax and industrial district payments.

Keep in mind this number does include our debt service collections as well. You can see on the slide the collections were received by month with December being the highest as property tax payments must be paid by January 31 to avoid penalties and interest that $28,900,000 broken up is 10,100,000.0 allocated to the general fund and property tax 4,470,000.00 for debt service and that represents 47.61% of the property tax budget and then 14,300,000.0 of this amount is for industrial district payments which again was 101% of their budget. So, we've collected $187,000 over budget for IDAs. And we'll go on to sales tax. Okay.

And as you know sales tax is collected two months in arrears meaning posted revenue has a timing delay. So, this represents quarter one always represents one month's worth of collections. But it was a good month with a 9.8% that's a 9.89.08% increase compared to last year's collections so again it's one month but it is you know a 9% increase compared to last year we saw an increase last year so sales tax has been trending positively for the last several years and across all sales tax revenue accounts including CCPD fire and CDC we've collected 1,850,000.00 with 935,000 of that being allocated to the general fund. In quarter one we realized 11.43% of our budget. So, if collections continue to trend this way we are on target to exceed our budget for the year.

And we'll go on to enterprise funds. The city has three enterprise funds that's our water and sewer fund, our storm water fund, and our Dow active complex fund. The water and sewer fund is our largest enterprise fund and it's collected 2,900,000.0 in revenue representing 18% of its budgeted revenue. These services are billed in arrears so this reflects two months worth of collections which puts them right on target to make their budget as well. On the expenditure side they have realized or encumbered 5,600,000.0 which is 33% of its budget.

The stormwater fund has collected 77,500.0 in revenue representing 15% of its budget. Stormwater is also built in arrears so that is two months worth of collections. And they've realized or encumbered 218,600.0 in expenditures which is 39% of its budget. The DAC has collected $149,000 in revenue which represents 14% of its budget and realized or uncovered 741,800.0 in expenditures which is 35% of its budget. And we'll talk about debt.

So, as of October 1 the city has an outstanding principal debt obligation of 139,200,000.0. Debt service payments for 2026 are approximately 13,800,000.0 which includes 8,240,000.00 in principal payments and 5,590,000.00 in interest payments. We did just make our principal and interest payments for the year that is due on March 15. Then we'll have an interest payment due on September 15. And lastly we'll talk about fund reserves.

So on this slide you can see our adopted general fund budget is 57,700,000.0 for fiscal year twenty six. You can see how we've divided out our resources among the departments on the left side it's the dollar amount on the right side it is a percentage of the budget you can see we've entered the year with a fund balance of 54,160,000.00 and our fund balance represents 94% of our adopted budget and as long as there are no changes in operations we can sustain the city for three forty three days. So with that I will conclude the report and answer any questions.

Questions, comments? Agenda item number five, discussion of issues relating to potential restroom facility and options for a potential handball court at San Jacinto Park.

Okay. So I think the last time we spoke, we had mentioned we brought some proposals together for building some new handball courts. I think it was decided at that time that we would explore other options and building something new just wasn't cost effective. We looked at some existing facilities. And I think we asked the handball group, but also mentioned looking at other locations.

Haven't really gone anywhere. We haven't really identified anything that would be feasible. I was talking to Jay for a little while, and we did discuss the potential of building a restroom on-site, which we're going to do. So we thought, well, what if, just trying to get creative and brainstorming, what if we built a new restroom? And this is the quote we got originally for the facility.

What if we built a new restroom and used the back wall as the handball? So we thought, well, we're building it anyway. This something that's even feasible? You didn't consider. So if you look at the design here, you see in the top left, that's the rear.

So there is a door. This is about $200,000 And a regulation handball is 20 feet wide by 16 feet high. The restroom here is about 20 feet wide, but I think it's only roughly ten, twelve feet high maybe, eight or 10. So basically, we'd have to do so if this is something that we want to consider, there would be a design challenge. It would look a little odd to have a rear wall higher than the rest of the building.

So it would be either do we extend the restroom to make it much bigger, which would increase costs pretty significantly, or do we keep it this way? And do we look at a concrete wall in the back, relocating this door? If it's something that we want to do, we would probably have to turn it over in house to Dilcia and her team. And that would take some time and effort on her part. So before we went that route, we wanted to come back to counsel to see if that's something that you'd like us to continue to pursue. So I don't if there's anything else, Jay, you wanted to add. But that's kind of, I think, the extent of why we're here.

Yeah. Just, know, we left as Kenny said, we left the discussion last time. Let's get serious about restrooms over there. And I think that's going be a very popular thing with the football players, for sure. And that is this is I'm going say it's the best solution, but it is a solution. I think it's better than mixing it with tennis over here. So if it's something that you all are interested in, we'll continue looking into it. Same thing as before, just what direction you want us to go. Are you talking about eliminating handball altogether by not doing this? Or looking for a different place to put handball if we don't do it here?

So if don't do this, Jacob and I will continue to put our heads together and see what else we can come up with. So we currently have no other plans right now. We don't have any other options at this time.

Do you feel like if we do that, that's going to cause the handball people to more try to utilize the pickleball as well? I mean, don't have a wall, but they won't really

I don't think they would mix the handball and the pickleball. Don't think that would work. They can't. They They can't.

That from the numbers that we heard and what I researched, I don't feel a need for

it. I feel the opposite. I think we ought to accommodate some people with handball. Build all these pickleball courts. Do a handball court.

Have you been to the pickleball courts? It's being used a lot.

What does 70 handball players the bathroom with and without the handball court?

No. So that's the next step. That would take, like I said, some time and effort on our part. And if you want us to work on that, we can. But that's why we're here to see if we want to pursue this. So we don't have that yet. But if you'd like us to work on that, we can.

More appropriate to bring a cost factor to the table. Even though I don't see enough people playing handball to justify not,

Thomas himself.

If it's a certain amount, it's one thing. If it's over $100,000 it's another thing. I don't know what the number is. But I think it'd be good, instead of presenting this, to give us some numbers.

We just want to see what if you wanted to remotely move forward with getting more information. If you do, we'll do the thought.

But, Ron, for me, I'm not interested in this, honestly.

Because it's not just the wall. Sorry, man. Yeah. I mean, don't you need fencing on the side? Or do they just look small? It's

bouncing around.

I think there's one way of playing it where there's just one wall.

Right.

And there's another way of playing it where there's three walls. Is that

right? Even if there's just one wall.

Correct.

So There's

no fencing on the sides or

Correct. So, yeah. So if there is one wall, then we would need flooring or platform. Yep. Yes, to play on. Three wall would obviously be significantly more expensive that I think after we met last time that we're getting to the price ranges. The challenge to doing it this way is if you build one wall by itself, you can use both sides. With this option, would not because you have the restroom on one side. So it would strictly be just one single wall handball court is what we'd be able to provide with this option.

Do you feel like there's enough people asking for it? I mean, know we have this one small group, but that's not a large group.

Yeah, it's really hard to tell. I mean, do have a pretty dedicated group of individuals that are very committed. Is that eight people? Is it 20 or 30? It's really hard to say. There's definitely it is a small group. But they're very it's a very committed group.

I think it just comes down to a cost thing at the end. If it's not that big of a difference, then that's fine. If it is, then I don't feel there's enough of to justify doing it. But we need to see a number to be able to make that decision. But for the most part, I don't think it's needed.

We'll move forward then and get cost of building a restroom without one and cost of doing it with one and

see if you

do that one. It's good cost

of building I think it makes more logical sense to have some cost factors attached to

it. Thank

you. Agreed.

Agenda item number six, discussion of issues relating to an ordinance regulating motor assisted scooters, self balancing transporters. What is that? Like a hoverboard?

What the freak is a self

balancing It's like

a segue. Back to the future.

It's a segue.

Segue. Oh, and e bikes. I didn't know we've gone from e bikes to self balancing transporters.

Trying to anticipate, mayor. What could come next?

Ready graduate from my e bike to go to the self balancing transporter.

Can you see back to the future?

You know that?

The first thing I would like to do, not Jim's in agreement, the fourth, whereas in the middle of the second line down from that safety and welfare of the community to eliminate traffic and safety hazard, I would say mitigate, if we could change that word. We're not going to eliminate any traffic hazards,

and I don't think we should have that

in our ordinance. I missed that. I apologize. When we set out to do this ordinance, obviously, what we have now is very restrictive. And with the proliferation of these devices that we've seen in our city and across the country, we tried to rewrite this in a manner that would give more access but with safety guards in mind and then hopefully some age appropriate restrictions and things that I'll go through here in just a moment.

There's there's some definitions and things like that. The big thing gets starts in sixty two dash one ninety three talking about restrictions and prohibitions. And the first thing is, obviously, they the question came up, do we put them on the sidewalk to make them stay in the road? Well, I don't think we want them on San Augustine in Center Street. And and a later one says that under the age of 15, they they can be in a neighborhood with a speed limit that doesn't exceed 25 miles an hour.

So that'd be residential neighborhoods. They can get but on the main roads, if they're gonna go anywhere, like the deck or wherever, they they would we're gonna have to go on the sidewalk. So the first thing we did was said that they have to yield to pedestrians. They can't just be running pedestrians down and everybody having to yield to them. And so they if they have any way to collide with a pedestrian or any of that, it's gonna be basically their fault unless some pedestrian does something stupid and steps in front of them.

We've also put in here that whatever would restrict their hearing. We've tried to list the things that we could determine that would restrict hearing where they can't hear horns or anybody around them, that they cannot wear those while riding these devices. And then under the age of 16, they must wear a helmet.

Under four,

they they can't carry more people than they're designed for. Number five, at nighttime, they must wear a state law of required light that meets the the transportation codes definitions for that. Number six, anyone under the age of 10 cannot operate any of these on a roadway or sidewalk. They can do it in their driveway, but not out on a sidewalk or even in a residential neighborhood under the age of 10. And then under seven, it should be unlawful for the age of under the age of 15 to operate a class three e bike or operate a motor assisted scooter e bike in a neighborhood that exceeds 25 miles an hour.

So they couldn't get on a road that has 30 and above. Anything above 25, which captures our new subdivision and the old residential, they could ride in any of those residential neighborhoods. And then when under eight, we've got them maybe a little bit stout, but we do have them requiring to stop at intersections before they cross. If you look at them now, they zip across however fast their device will run. So we want them to stop and look and make sure that it's clear before they go across.

And then one of the big questions that came in is what about cars pulling in and out of private drives, the post office, city hall? So we put the onus on these folks riding these devices that their job is to yield to any car egressing or ingressing these locations. Because by if you're coming down through there at 20 miles an hour and 25, it's gonna be very difficult for a car watching for vehicles and everything else to be paying attention to see if so we want some responsibility back on the folks riding these. And that should hopefully slow them down. It may take some enforcement.

But slowing them down and knowing that if there's a vehicle there, you must yield to them, not opposite way. And then we've with Kenny, And number 10, it shall be unlawful for any person to operate, park, or ride any motorized or unmotorized vehicle, bicycle, scooters, skateboard, or roller skates in any city park. And 11, this is the hike and bike trails. You can use the all these devices, but golf carts, motorcycles, other motorized motorized vehicles are prohibited on them. So that's the what we came up with. And so I'll toss it out for questions and see if you have them.

Since the Boy Scouts are here, do you mind, because how many of you all have e bikes?

Any of you

all? Just explain a little bit of why we're doing this. Like, the problems that we've had, basically.

Yes. Well, since last November, the number has gone exponentially straight up. Not only in our community, but surrounding communities all across The United States. It's one of those just phenomenons. And with that has come a number of bicycle or these type of devices, motor vehicle wrecks. Thankfully, none serious thus far. But I think a lot of those we've had significant near misses. I had one last week that had I not seen the blur in my peripheral vision to the right going north on center about to turn on San Augustine. I had three of them barreling down on me at about 25 miles an hour that had I not hit my brakes, I would have taken out at least

two of Right on. Can't make this. There

you go.

Right right here.

Did you do that

So,

yes, we have seen everybody's dealing with this.

That's pretty good, chief. I'm I'm really impressed that

you Is

that pretty hard?

That's where the hell is. Just signing up right there. I have a question probably for y'all. So I know this is kind of new and a lot of people are not aware of this. How do we get this out to the public?

We've done a lot of communication through the normal social media channels. Once this has passed, we'll do more. And Chief has found Pasadena and other cities around us, because it is an issue that's affecting miss families everywhere, The communication pieces that they've done.

And the good thing is they all ride to the deck, so you educate them at the deck.

Get them all?

Kenny, you'll leave a little flyer.

No, go out and take a conduct of that, Garrett.

We can definitely brainstorm educational campaigns and find ways to I distribute think it'll be fun. Yeah.

Like how we used to do bag safety.

Think so. Bag radios? Yeah. I do want to thank Kenny and chief and a lot of effort, particularly about the police department.

Definitely.

Jim, Sarah, a lot of effort went into this. Lots of questions were asked. Well, you'd see something and say, what does this mean? What does this mean? A byproduct of this? What's a consequence of that? So I'm very happy with all the work that went into getting us to this point.

That's a lot of work. Good job, guys.

Definitely. So question, Michael, number 11. It distinguishes the class one and two e bikes for riding on hike and bike trails. But does what you implied, for example, like anything of course, mine doesn't I've got one. Mine doesn't go over 20. But like, what if I were to get on it to come to the DAC? Would I still be required to do it on the sidewalk versus the road? Or could I still get on the road and ride it?

You could get on the road if you desired or you could ride the sidewalk. If you were on the sidewalk, these rules would apply to you. If you get on the street, the transportation code rules apply to you just like a vehicle, So any other

in any other normal process of bikes that using roadways like normal?

If they're 16 and above, they can ride

in the So it's really only going to be applicable for 16 and below as a general rule of thumb? Yes. Right. You comfortable with that, Mr. Fox?

Yes. You're getting As

the city attorney and prosecuting attorney, you're going to have to manage some of this.

That was a great team effort. And there was a lot of work done going into this. There's probably eight revisions. It was

I agree with Mr. Stokes. Think kudos to both of you guys and the department for all the effort you're putting into this. And hopefully the end result is we can mitigate an unfortunate narrative and make it safe for our community. Yes, thank you. Any more comments or questions, counsel? No. Thank you, sir. Thank you. That's all the items we have for tonight's workshop. Our regular scheduled meeting will start here shortly. This meeting is adjourned.