Transportation and Economic Development Corporation - Regular Meeting

Good evening. I'll call the Thursday, July 24 meeting, the Transportation Economic Development Corporation meeting to order. And we do the roll call, please.

President Flores.

Here.

Vice President Thierryl.

Here.

Secretary Villarreal?

Here.

Board member Basing?

Here.

Board member Mossman?

Here.

Board member Neely? Board member Sherwood? Here.

Thank you. Item c, citizen citizen communication. Anybody here wishing to speak to the board? Seeing none. We'll move on. Item d, approval of minutes d one, consider approval of the minutes from the 06/26/2025 Transportation Economic Development Corporation meeting. Any questions on the minutes? Entertain a motion to adopt the minutes.

So move. Second.

I have a motion by vice president Thoreau, second by board member Basie. Any other discussion? All in favor, signal by raising your hand. All right. That passes unanimously. Thank you. That will take us to item E, presentations. E1, consider presentation for the third quarter financial update. Kevin?

Good afternoon, President and Board members. This item is our quarterly financial update for the third quarter of the fiscal year with actuals through June 30. Start out with our revenue sales tax actuals. Type B sales tax is trending 6.1% through June above the prior fiscal year. We started out a kind of seesawing right above and right below the projection line, But, we had a June was a good month for us.

We saw a spike in payments due to a large sales tax payment come in from Dell. It really pushed our actuals above prior year actuals. And, again, correct myself. That 6.1% is fiscal year to date through the most up to date information, which is through the month of July. Staff continues to monitor sales tax closely, but it looks like we will end this fiscal year slightly above budget, which is good based on where we are fiscal year to date.

From the expense side through the third quarter through June 30, transportation expenditures are right as planned. We've expended 62,750,000.00 through our TCIP program as well as the other smaller expense categories. On the economic development and park side, we've expended $6,440,000 through the third quarter of the fiscal year. So overall, the expenses remain in strong shape and are projected to come in within budget. So kind of the update on some businesses business to date that the board has approved.

As you recall, back in February meeting, we had the presentation strategic plan from the Round Rock Chamber of Commerce. And in April, we I was before you and talked about the debt service payment agreement and the issuance of $20,000,000 for the road portion of our twenty twenty five certificates of obligation. With that, I'll be camps to answer any questions on the quarterly report.

Any questions on this item? All right. Thank you. I'm gonna take us to resolutions. F one, consider resolution approving and proposed amendment to the Transportation Capital Improvements Program to increase funding for the Harrow Parkway project.

Yes. This item is a resolution approving a proposed amendment to our transportation capital improvement plan or TCIP project. This is an additional 6,800,000 for the Harrell Parkway project. This has been identified in our TCIP. Funding is available. It is also included in our proposed budget on the agenda for tonight as well as our five year allocation plan. Be happy to answer any questions.

Any questions for Kevin? Mr. Basia?

So this has been this was in the the five year plan prior to this year as well. Yeah. It's been when did we add that in?

That's a great question. So it was added this last year. When when items come identified with additional funding needs, they get rolled under the planned projects line on our five year allocation plan, and then subject to board approval, they then roll up in the TCIP itself, which is what this resolution does. So this is identified as we looked at that Herald Parkway project. It's out there. Herald Parkway and the Apex Fields are together in one project funded by the Type B board as previously authorized. It's out there with all the activity going on in Old Settlers Park that I believe the board was able to see on their tour this week. This funding was identified to really fix that low water crossing just coming in on Harold Parkway heading north from Highway 79. This is not low water crossing. This brings that up to above grade.

It was identified as a important piece of the project as we're going out there working on Harrow Parkway itself. This additional funding was identified, has been under the planned projects category. Again, this resolution just rolls it up under the TCIP program.

So are those two different buckets of money? Like, when it's planned, it's in one place and then it moves into the actual? Yes. If if some of this is better when we get to the budget, that's that's fair too. Like, I'm I'm just that's okay.

So Yes. That's a good so under the five year allocation plan, which I I will have a slide when we get to that five allocation plan presentation, we kinda have a planned projects that sits down lower in the fund schedule of projects that staff has planned that we intend to bring to the board for consideration to move on to TCIP. This has been sitting there, this $6,800,000.

Okay. Let me try and ask this a different way. So, like, five year plan is based on the current year and the future year budget and best forecast. Right? Like, so let's call it a $125,000,000, you know. So is that 125,000,000 committed to what's in the TCIP and then there's this other I guess what I'm getting at is when something moves in there, does something have to come out, or is there extra is there excess capacity in that plan to allow those that are that are in that waiting bucket to get moved in without moving something else out? Yeah. Does that make sense?

Yes. Both the TCIP program and the planned projects are stay within the available capacity of the type

of application. Gather the available capacity. So it doesn't matter which bucket it's in. It's still in the avail it's not a

Yes, sir.

The the it's a different stage, but the combined amount is the five year plan in terms of the dollars. Yes. I don't know why I didn't understand that before. Thank you for clarifying that. Thank you.

Yeah. No. I mean, I think at that point, maybe it's just committed funds versus in general

This is in the plan. Committed to a dedicated project. Got it. Thank you.

Any other questions? All right. Thank you, sir. That'll take us to f two. We're gonna do f two and f three, but they're both public testimony. So I'll read them both. F two. Yes, sir. Entertain a motion to approve f one resolution.

So moved. Second.

Alright. Have a first by board member Mosson, second by board member Villarreal. Any other discussion? Alright. All in favor, signal by raising your hand. And it passes unanimously. Thank you. Thank you, Steve. I'll take us to items f two and f three, but f, we'll do f I'll read them separately, but Kevin's gonna present as one. F two, consider public testimony regarding a resolution to adopt a five year funds allocation plan for f y twenty six to 2030 for the Round Rock Transportation Economic Development Corporation.

F three, consider public testimony regarding resolution approving the FY twenty five twenty six operating budget for the Round Rock Transportation Economic Development Corporation. Kevin.

Thank you. So my presentation will again include both items. So starting with the proposed budget. Our proposed budget for the type b corporation for fiscal year twenty twenty six is before you. This includes projected revenues of $90,400,000 Sales tax revenues from the half cent sales tax dedicated to Type B purposes are projected to generate $32,000,000 Contributions and other are $28,400,000 These are contributions from other entities that are contributing towards our transportation infrastructure.

And then we have planned $30,000,000 issuance of transportation COs to be issued in 2026 next fiscal year. On the uses side, have a proposed budget of $158,000,000 This includes $151,200,000 in TCIP projects, including the $12,000,000 for our arterial maintenance bottlenecks, sidewalks, and traffic signals buckets. We also have $3,800,000 in debt service payments, 1,400,000.0 for signals, legal, and other costs, and $1,600,000 for technical and administrative support services. On our economic development side, we have in the proposed budget $14,700,000 that includes 12,600,000.0 of approved economic incentive payments, including $11,600,000 for the district infrastructure incentive. We had the chamber contract as well as 1,200,000.0 for downtown marketing and other.

Parks and recreation, we have $6,800,000 for the Old Settlers Park Track And Fields. That commitment of which the type b board approved has already approved. Moving into the five year funds allocation plan. I did wanna point out staff does have one recommended policy change as it relates to the five year allocation plan. This lays out our current policies.

Again, all uses under state law and allowed by local election in 2011 continue to be the policy for expenditures by type b. Our new policy proposal, we would like to define the limit of budget increases not requiring approval by the board. The the language we have had in there is that projects return for approval for significant change in scope and or an increase to the budget. We would like to define what significant change is, so staff's recommendation is saying that 15% of the approved project budget not to exceed $2,000,000. I did wanna point out this would not apply to our projects we run through those buckets I mentioned earlier, arterial maintenance, bottleneck, sidewalk, and traffic fuel projects.

Those programs are adopted by a certain dollar amount each fiscal year, but this policy proposal would be for items named in the TCIP that we would return for approval for that change. And it continues to be on the annual budgets approved during the budget process. Looking at revenues over our five year plan, as I mentioned, we have $32,000,000 projected in revenues for 2026. We are anticipating sales tax growth of 3% annually over the five year time period. So this is our five year funds allocation plan looking at it all together.

Total five year funds coming in are $443,600,000 coming in from sales tax, transportation, CEOs, and those contributions. On the expense side, we have total five year expenditures of $428,900,000 Those are 90% for transportation projects, 8% for economic development projects, and 2% for the parks and recreation project for that work out at Old Sellers Park. In our five year allocation plan, it leaves $14,700,000 unallocated. That then can be rolled up into the committed projects as needs arise that then staff will bring to you in the future for potential amendments to either your TCIP or your EIP. On the transportation side, again, have five year funds at $384,000,000 $238,100,000 is TCIP programmed.

And you'll see that pipeline planned projects sits down there at 92,100,000 All in all, we have $384,000,000 identified over the five years funding allocation plan for transportation, making up, again, 90% of the total allocation. On the economic development side, we have the chamber contract annually, the downtown improvements in marketing program annually. We have $24,400,000 in committed payments and $3,000,000 of EIP not yet allocated but committed for future EIP purposes. All in all, $34,400,000 in the five year EIP. Happy to answer any questions on either the budget or the five year allocation plan.

And, as a reminder, there is a public hearing on these items posted on the agenda.

Alright. So thank you, sir. Any questions on f two, which is the five year funds allocation plan? Yes, sir.

Would you go back a couple of slides? I'm not sure which one. That might be it right there. Can you talk me through the the one year change? I mean, it looks like there's a doing the math in my head, like a 45% reduction in economic development year over year on the proposal. What can you kinda walk me through what what happened there and what that means in terms of kind of our plans going for I'm like I'm it just seems like it's a big delta. What

can you give me some color on that? Yes. Certainly. So yeah, when you look at the five year allocation plan adopted last July and proposed this July, while it is a decrease, a couple things are going on. We've had some projects through Type B that have phased out. Most of the thirty four point four million dollars committed right now is for the district. Yeah. Commitment is 25,000,000, so that's is still there and has continued to be there. The Parks and Recreation project was also new, was approved by the Type B board since last year. And while it is labeled Parks and Rec, one of the highlighted as such, it really rolls up under the economic development portion of the allowable uses.

So we kind of shifted some of it there. I think that Parks and Rec took up some of the former uncommitted EIP payments that were part of the 59,000,000 in the prior year, and are just being displayed differently. We are continuing to keep economic the e fund development arm at about 10%, but that parks and rec is included. We do continue to have this $3,000,000 I mentioned as EIP to be allocated for other purposes in the future. I think that was a larger number last year before the Parks and Recreation kind of got plugged in on the EIP side of the equation.

Any other questions? Board Member Mossman.

Can you please talk a little bit more in regard to clarifying the 15% increase without the approval from the board? I just needed some clarity around, is that from the original amount that's going to be approved by the board? And if so, every time that that increase can happen, are you able to increase 15 additional percent up until that 2,000,000 mark or each time only one time?

Each the staff's recommended policy changes to be able to increase a cumulative 15%, not to increase slightly under it and then come back and increase without the board's approval. The idea would be for these large projects, should we have sufficient funding in the committed or TCIP program, we would staff would be able to increase the budget under that 15% or $2,000,000 in a cumulative fashion. But for if and when a project would go over that, we would continue to bring it back to the board for consideration.

And how long would that be available to and on a yearly basis that can occur or after that year time, does it still need to come back to the board?

Yeah. So project budgets are set up on a life basis. So it would be as long as we're working on that project, we would be limited to we of course, staff always tries to stay within the budget that the board approves, but this policy change would be over the life of the project. It could not increase any more than that without us bringing back to the board.

And is there a cumulative amount over the entirety of, say, a a fiscal year that through all projects that you would not exceed a certain amount?

We don't have that currently envisioned. Staffs were really thinking on it for a per project basis. It really is to to reduce the administrative I wanna say burden. It it was really to reduce the instances we're coming before the board if money is there and identified. It really is to reduce the amount of time that we're coming back by having that cap on there. But we were thinking on a project by project basis, not really a cumulative amount over the whole program.

My concern with that is that if you look at, you know, for whatever reason we have an increase in in cost of materials and you have to across every project increase by 15%, by all means that could potentially create some issues within the budget. And so can we can I propose that we put some sort of language to protect the budget from that?

Yes. I think we could certainly put language in there that the that any overage would have to stay within a sustainable budget amount as as well. So that to to your point, so we don't get to if every project were to go over in the budget be at risk.

Perfect. Thank you.

I've got a question. Yes. Where am I there?

Can you go back to the slide that Britt was looking at? The down in the bottom right, there's a net available to be allocated $14,700,000 Can you talk about what that is and how it can be used? Can it be used for economic development funds? Is it this $2,000,000 or is that where this is coming out of or what's what's happening with that?

Yes. I can definitely answer that. So this 14,700,000.0, it is not in any it has is not in transportation nor e guy development. It really is just sitting over the five years. We have unallocated funding uncommitted funding of 14,700,000.0.

This is typically higher than we would have, as you saw last year's adopted had a net available to be allocated of 662,000. Some of this is the timing as I'm leading the city through the budget process. We had the type b allocation plan. It was balanced, but I really wanted to take the effort to align our type b sales tax projections with the same sales tax projections we're using for our general fund sales tax collections. It kinda gets us back to the revenue chart showing the 3% growth each year.

Type b had been set up with the five year allocation plan slightly less than that. So when I aligned them, it created a bit of extra unallocated revenues because it increased revenues over the five years. Rather than go back working through with the transportation department on identifying where they could plug those in, we decided to bring it forth as unallocated. So it's sitting there. It is available over the five year plan to be used as needs arise. But that's what kinda why it's a little higher this year than it has been in the past.

I mean, I think that makes sense. I mean, it just you know, looking at this, I mean, it just almost looks like the the 14,000,000 came out of economic development because of where the the bot the net available was last year, and now it's all of a sudden in this, you know I mean, I guess my question is is when I look at the the number, which is hold on. Let me find it back here again. It's not on that page. What was left? The 600 I think the net on no. No. Not there. The the net like, what's what's uncommitted in economic development was 3,000,000, I believe. I don't think I see it on this particular slide.

It was on a different one. Yeah. This is over the five year plan, so that essentially leaves us with $600,000 a year over five years. You know? I mean, I would hope that we're gonna be I mean, just just the district itself is eight times that amount

Yes.

In in one project. It's eight times the five year amount. And so I guess I'm just, you know, I don't Brooks, do you wanna wait? I mean, can you help me out a little here and just sort of talk me through? Because that number is really thinned down to the point where we can only do one eighth of the district over five years with that number the way it it's pegged in there today.

Yeah. I mean, I think it's important to note that it's unallocated. So, you know, we'll have discussions as projects come up similar to, you know, project plenty being an example. Right? I mean, that was an expected cost and it went away. We would have found a way to make it work with with inside those funds. So don't wanna have it appear to be like a Rob Peter to pay Paul sit situation, and we'll continue to work to make sure those projects come up that we put them in the plan and we get get them funded. And and especially with the notion being for most our projects to be performance based. Right? So you get a a revenue and then a EIP based on what that revenue is. So as you're doing the math on that, we'll weigh that into account for for doing deals.

Sure. But, obviously, a lot of times, the the money is spent before the I mean, they're performance based, but you still have to front load some of that money in some cases. So I guess, let me just ask it this way. This change doesn't change anything from a strategic perspective on what Jordan and her team are doing. They should continue to go after the same deals at the same pace they're doing. The the and then when they bring those deals, you'll find a way to make them work assuming they pencil out similar to what we've always done in the past. There's no change to any of that. It's just a numbers thing on the slide here.

Agree completely with that.

Is that a fair

Yeah. Fair assessment? Let's let's let's do deals. Okay. Good good deals get done.

Okay. I just it just is like a major change, and so I just wanted to make sure we kinda talk through that a little. I appreciate it. Thank you. Yep.

Alright. Any other questions?

Well, I just wanna make sure one thing. So is the 3,000,000 in the 14,000,000, or is it in addition to?

The 3,000,000 would be on from this slide, it falls under the 34.6.

It falls under the 34.

So it's really 17. If you were to use it all, it'd be 17. Not saying they'd use it all for economic development, but yes.

Okay.

Thank you. Alright.

Any other discussion? Alright. This is a public hearing, so I will open up the public hearing. Anybody wishing to speak on this item F2, the five year allocation plan? Seeing none, I'll close the public hearing. Entertain a motion to adopt F2.

So moved. Second.

Alright. I have a motion by board member, Besi. Second by secretary, Villarreal. Any other discussion? All in favor, signal by raising your hand. All right. Passes unanimously. Thank you. All right. Any other further discussion on F3, which is the twenty twenty five-twenty six operating plan? All right. So this is also a public hearing. I'll also I'll open up the public hearing to anyone wishing to speak on this item, F3. Seeing none, public hearing is closed. Entertain a motion to adopt the minutes.

Second.

I have a motion by Board Member Mossman, seconded by Board Member Basie. Any other discussion? All in favor, signal by raising your hand. That passes unanimously. Thank you, Kevin. All right. If there's nothing else for the good of the Board, we are adjourned at 05:25. Thank you.