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MIN CC 08/15/19891 MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 455 MNUTES OF THE HUNTSVILLE CITY COUNCIL MEETING HELD ON THE 15TH DAY OF AUGUST, 1989 IN THE CITY HA COUNCIL CHAMBERS, LOCATED AT 1212 AVENUE M IN THE CITY OF HUNTSVILLE, COUNTY OF WALKER, TEXAS AT 6:10 P.M. The Council met in a regular session with the following members present: Jane Monday 0. Eugene Barrett City officers present: Gary Bell James L. Carter Ruth DeShaw, City Secretary Ila G. Gaines William B. Green Scott Bounds, City Attorney William H. Knotts, Jr. Percy Howard, Jr. Absent: William L. Hammock Absent: Gene Pipes, City Manager CALL TO ORDER Mayor Monday called the formal session to order at 6:10 P.M. She then recessed the meeting into executive session to consider pending or threatened litigation: Acker v city, et. al., and Fire Departm Response Accident. The executive session ended at 6:43 P.M. with no action taken. RECONVENE FOR CITIZEN INPUT /INQUIRY SESSION Mr. George Russell. 1409 19th Street, Huntsville. concerning Planning Commissions action on a variance Mr. Russell indicated he wishes to speak on the improper action of the Planning Commission ii granting variances for speculative purposes in opposition to the direction of the Comprehensive Plan. Mr Russell said he was shocked and mortified while he visited the Planning Commission meeting on Monday. H said he is here to protest, on behalf of two state organizations, a plan, for speculative reasons only, t destroy one of the most beautiful remaining, natural ecosystems on a major thoroughfare in Huntsville. H said this is a little creek that exists on the corner of 11th Street and Normal park. He said he was unde the impression that variances were granted, in such cases, especially if they were negative variances, whe a developer would come to the Council and show that the code was such that it was going to prevent a higher better and more community- minded use for a piece of land. He said he understands some times the code can b restrictive and a variance is necessary to improve our quality of life. He said in the case in point however, the City Planning Commission, with the exception of one member, who understands the role an mission of the City Planning Commission, used the variance authority to grant a variance which will b exceedingly damaging to the beauty, the ecology and the quality of life of the citizens of Huntsville. He said the philosophy, as expounded upon by the Chairman of the Planning Commission [and also ever by a member who claimed to have a conflict of interest, who then spoke at great length as a citizen and not as a member of the Planning Commission] was, as he interprets it, that any land that is owned by and business, that this businessman has total and exclusive rights to do with that land as he so pleases. He said this is like a God-given right to destroy it. Mr. Russell said there are restrictions on businessmen; noting he cannot put in some wierd porno shop, etc. right on a corner as there are a number of restrictions. He said to destroy this creek on a speculative basis is more obscene than that. He said the Chairman of the Planning Commission denied that the Planning Commission has any responsibility to even attempt to encourage businesses to follow the guidelines of the Comprehensive Plan; quite frankly denied it. He said only Mrs. Marsha Phillips repeatedly attempted to quote, as best she remembered it, from the Comprehensive Plan - -only her. He said he also felt the city staff acted in an irresponsive manner because they would not back u; Mrs. Phillips at all and merely sat quietly with their mouths closed and let her dangle on a line while the others grinned and went right along with lowering the standards so that this property owner could destroy this beautiful piece of property, not with any plan in mind at all, but on a speculative basis. Mr. Russell said he would like to remind folks that the Comprehensive Plan, Ordinance No. 89 -7, was adopted by the City Council and it is reflective of the official views of the City Council; noting this is not what the Comprehensive Plan states: . . . By anticipating the needs of the community for public facilities well in advance of physical growth and expansion, costly mistakes in design construction and location of specific projects can be avoided." He said here the Commission just precipitously grants a Lowering of standards to destroy this public and community asset. He said the Comprehensive Plan serves as the tool through which the attitudes and aspirations of the Commission are formalized into a set of goals MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 456 and objectives for the city. Mr. Russell then referred to the Comprehensive Plan, Goal Four: "Provide Recreational Areas and Open Spaces to Meet Future Community Needs" . . . [Mayor Monday asked Mr. Russell to summarize his remarks as there are two other people who wish to speak.] Mr. Russell then read the section entitled: "Greenbelts /Open Spaces. A city -wide system of greenbelts should be established. Creeks and natural drainage channels can be preserved as greenbelts in recognition of their high aesthetic and functional value to the community and to create a linear unifying element providing scenic beauty and recreation, such as hiking . . . the city should actively acquire drainage conservation easements along all major drainage channels in the city. These easements should be sized to allow the drainage channel to remain, whenever possible, in its natural state. . ." He said this is the philosophy of the City and yet the Planning Commission abrogated its duties and responsibilities and bent over backward to make it easier and cheaper for an entity to destroy this wonderful public asset on a speculative basis. Councilmember Knotts said he agrees with Mr. Russell. He said in the City's Development Code, a variance should not be granted unless there is an undue hardship and in a speculative case, there would not be an undue hardship. Mayor Monday noted the Council will get the Planning Commission's reasoning for this variance and Mr. Dale Brown or Mr. Gene Pipes will acquire that information and advise the Council. Mr. Robert McCann, 1621 Avenue R. to express his opposition to a 3% increase in hotel -motel tax Mr. McCann said he is owner of The Huntsville Inn. He said he is here to express his concerns regarding the proposed increase in the hotel -motel occupancy tax rate from the present 4% to the 7% rate. He said there are a number of owners and operators present tonight, all of whom are opposed to the proposed increase. He said although the project being proposed by the Huntsville Arts Commission may have merit from the City of Huntsville's point of view and for its citizens, he believes an increase in the hotel -motel occupancy tax to pay the lion's share of the total cost, is an unfair and inequitable method to finance the endeavor. He commended the Arts Commission for its hard work and efforts over the years to enhance Huntsville's cultural life. He said he knows personally most of the members of the Arts Commission and it is composed of some of Huntsville's most dedicated citizens. However, he said, to impose the burden of financing this project on one industry seems totally and absolutely unfair to his group. He said they believe, in addition, that they represent the feelings of other industry groups as well. For example, he said, it would seem unfair to them to impose a 3% surtax on dentist patients, on timber brokers, on printing and office supply customers, on student tuition, etc. He said they believe the concept of holding one specific group accountable for the entire burden is less than honorable and stretches almost anyone's concept of fair play. He said some will suggest that the tax burden is a "pass through" and is therefore carried by their guests. He said they believe such a comment shows a lack of concern for their visitors or a rather shallow understanding of supply and demand elasticity, or maybe both. He said price increases, whether for room adjustments or from tax adjustments, will result in fewer rooms rented. He said if called upon, he can prove that. He said they understand the city's desire to redevelop the downtown area and they support the city's efforts entirely. He said they believe that if we all want these things, we should all be willing to share the burden of the cost, either through a property tax increases, a sales tax increases, by private contributions, or any other means available and equitable. He asked if anyone had any questions. Councilmember Knotts asked if a big percentage of Mr. McCann's business is repeat salesmen during the week and that his occupancy is normally less on the weekends. Mr. McCann said repeat salesmen are regular customers during the week, but in the simmer time, occupancy is not normally less on the weekends. Councilmember Knotts noted however, the regular, steady customers are the salesmen and he understands if his establishment gets out of line in price, the salesmen will go to adjacent towns. He said there are normally two reasons they will stay in Huntsville: 1) better motels and prices; and 2) better restaurants; and if we tax them out of town, they will go somewhere else. Mr. McCann said they almost never get a customer now who doesn't ask the price and many leave if the price is not right. He said this elasticity of supply and demand does affect the local hotels and motels. He said the higher the price, the fewer rooms they are going to rent. FJ MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 457 Councilmember Carter asked where the salesmen go if they leave Huntsville. Mr McCann said these people go to Conroe or Madisonville. Councilmember Carter asked about the cost of gasoline to go back and forth. Mr. McCann said he can't tell him it makes sense to do it, he just knows they do it. Mr. McCann said he visited with a local salesman last night who lives here in Huntsville that travels a great deal and he said he spots the towns that have the high occupancy rates and he avoids those towns all over the Southwest. Councilmember Carter felt the customers may have a shallow understanding of elasticity if they are I spending more gas money to go to another town than stay here. Councilmember Knotts said these are route salesmen and they will be in those towns anyway and rather than stay in Huntsville, they will go on to Conroe. Counci (member Gaines asked what the tax is in the surrounding area towns and how much higher is Huntsville than they are already? Mr. McCann said he does not have the figures, but someone has that information. He said if Huntsville increases their tax to 13 percent total (7% for the city and 6% for the state), Huntsville will be equivalent to San Antonio, a real tourist town. Councilmember Carter asked if Mr. McCann had some comparative figures for hotel -motel room prices [Madisonville, Montgomery, etc.(. Mr. McCann said he can get that information for him. Councilmember.Carter said he didn't feel any of the council wants to tax anyone and he certainly does not want the burden of any tax falling on any particular group. He said the Council does not want to be vague here but it certainly wants to make sure that if they make a decision about an issue like this, it has all the information it needs and that everything is calculated. Mr. McCann said he concurs, but does not think he can get that information in a week. Councilmember Carter agreed the Council often makes decisions in too short a time. Mr. McCann said he is trying to prevent that tonight. Scott Cherryholmes to speak about the Downtown Proiect Mr. Cherryholmes said tonight he speaks only for himself even though he is a member of the Huntsville Tourist Council, the Economic Task Force, an Advisory Member and Film Liaison for Film for the Arts Commission; and a member of the governing board of the Huntsville Community Theatre. He said while he does not represent any of those groups tonight, he thinks this involvement gives him a certain perspective. He said as a marketer he would like to share some of his thoughts after being involved in this kind of development. He said Huntsville does have an excellent opportunity to reap financial benefits of one of its most obvious natural resources- -tourism. He said he didn't believe that industry is yet well-developed, but Huntsville does have that potential. He said it is his belief that due to Huntsville's proximity to Houston and Dallas; its accessibility on a major interstate; its historic significance with Texas' oldest prison, Texas only prison museum, Sam Houston's Home, final resting place, and Museum Complex, and a town that dates back to before Texas even became a republic, Huntsville has the potential to become a major Texas tourism destination. He said, however, before this can happen, an investment must be made by individuals, city and the county. He said tonight the City has a chance to seek federal aid, as he understands it, to this cause by submitting an application for matching grant funding. He said it has taken years for its development and months of planning to get to this point and the city's window of opportunity is now. He said he shares this dream with many Huntsville citizens who believe revitalization of downtown is the key to a greater Huntsville. He said the downtown square has been good to Huntsville and the property owners have contributed the tax base which has allowed Huntsville to grow since its early beginnings in the 18001s. He said maybe it is now that Huntsville should pay back that debt. He said after studying other communities like Granbury, Texas, near Forth Worth and Waxahachie between Waco and Fort Worth, he feels Huntsville can create a similar effect here. He said Waxahachie has a fantastic film industry because of the look of their downtown area; it is so busy in fact that they are looking for other areas because they are so bottlenecked. He said the Granbury opera House draws thousands of visitors each year and their city said it is full for every performance. He said Granbury has a thriving downtown and they say it is largely due to this Opera House. He said they have shops that cater to visitor needs like candy stores, art galleries, gift shops, and restaurants. He said Granbury only has a population of 5,500 citizens, yet their proposed 1989 -90 hotel -motel tax earnings are expected to top $185,000. He said 1% of their taxes support the Granbury Opera House and they do receive the total 7% tax earnings suggested by the state. He said this isn't a new option and has been on the books since 1984. He said it is interesting to note that the current Mayor of Granbury MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 458 was a hotel owner back in 1984 when the city decided to increase its hotel -motel tax base. He said he was at that time adamantly against the tax increase but now owns two hotels and is a firm believer in the additional revenues. Mr. Cherryholmes said this Mayor is also a bank President and makes loans to the other motels. He said he is someone that would be interesting to talk to on how the benefit of this money can pay off to Huntsville's hotels. He said Huntsville currently has a convention industry and over 30,000 participants visit Huntsville each year with the Criminal Justice Continuing Education Program. He said this represents about 22,000 visitor nights. He said these people are mostly Texas employees and they do pay the city tax. He said what he, would like to see is if we could get an exciting downtown, these folks that come into our town for these conventions could see what is going on, have activities for them in the evening, and then they would have a good time and they would possibly come back with their families. He said this would be a great marketing opportunity. FORMAL SESSION RECONVENED Mayor Monday then reconvened the formal session. Reverend Cecil McKee, retired methodist minister, presented the invocation. CONSIDER THE MINUTES OF THE PREVIOUS MEETING OF AUGUST 1. 1989 Councilmember Barrett made the motion to approve the minutes of August 1. 1989 and Councilmember Howard seconded the motion. All were in favor and the motion passed unanimously. MAYOR'S ACTIVITY REPORT - -JANE MONDAY Visitors from Japan Mayor Monday advised of the special guests, 23 young women from Japan, in the audience who have been a part of the Huntsville community this summer. She said the city welcomes them and wishes to make them all "Honorary Citizens of Huntsville." She asked the Council to join her in bestowing the honorary certificates upon each of them. Ms. Judy Olson of Sam Houston State University then introduced those present. She noted the students very much enjoyed the downtown area, especially Kings Candy and Bluebonnet Square; as well as the Wal -Mart, the West Hill Mall before going to the Galleria [in Houston]. The Mayor and Council then issued the certificates and congratulated each student. David Czervinske, 620 Hickory Drive. announcement concernina Children's Choir Mr. Czervinske advised he and codirector Joan Howey have just returned from a week long institute in Chicago for Children's Choral Directors across the country and Canada. He said at that time they were privileged to be invited to attend an International Invitational Children's Choral Festival in New York in •May of 1990. He said this opportunity was extended to a limited number of choirs from throughout the United States, Canada and Europe. He said the choruses which do participate will convene in New York City May 25, 1990 for four days of rehearsals which culminate in a final performance on May 30 in Carnegie Hall. He said they feel very privileged for their children and feel it is not only an honor for them and for their organization, but also for our entire community. He said he wanted to share that with the Council this evening. Mayor Monday congratulated him, his co- director and all the children and noted the Council will Look forward to following this with a great deal of interest. ATTENDING CITIZENS Mr. Rogers presented his proposal, which originally requested a rate adjustment of $2.00 per subscriber, however, after visiting with the city staff, they are willing to accept an increase of $1.05 per subscriber which will raise the basic rate from $10.45 per subscriber to $11.50 per subscriber per month. The proposal indicates Huntsville Cable TV offers a "broadband basic" programming package to its customers, consisting of 24 unscrambled channels. He said the rate increase will be effective October 1, 1989. Mr. Rogers' proposal indicated that channels like CNN, ESPN, USA Network, Arts & Entertainment, and The Nashville Network have invested significantly in new programming and have found it necessary to pass those costs directly to them. He said satellite and copyright programming charges have increased from $0.18 to 1 1 MINUTES Of THE AUGUST 15, 1989 MEETING BOOK "P" 459 $1.67 in 1989 and this is an operating cost increase of $1.49 per customer per month in this one expense category alone. Mr. Rogers noted the effect of normal inflationary pressures on cable tv rates at the rate of 4% would have brought the $8.25 rate in 1982 to $10.86 in 1989, but the current rate is only $10.45. Mr. Bounds, City Attorney, noted besides the increase in programming costs, the Cable TV Act of 1984 did limit the authority of the city to regulate rates by telecable operations and basically telecable operations are allowed to apply for a certain rate of increase. He said the staff is recommending that fees be increased as outlined in the ordinance, which represents a 10% increase in the basic cable subscriber service to $11.50 per month and leaving the basic cable service structure as it is currently. Councilmember Knotts asked Mr. Rogers if anything could be done to improve Channel 19. Mr. Rogers said Channel 19 has some interference from two -way radios, but that there is something that can be done to improve it. He said usually if there is a problem in one's home, it is usually a local problem such as a connector on the set that they can handle on an individual basis. He said Channel 19 will probably never be as good a quality station as some of the other channels because of the two -way radio interference. Councilmember Green asked the City Attorney if the cable company can increase their rates without council approval? Mr. Bounds said the company did not increase its rates last year by 5 %, and they are technically permitted 5% per year. Councilmember Green asked then if they skip a year can they add it to the next year? Mr. Bounds said he didn't know whether there has been a decision on this. He said given the increase in programming costs as demonstrated, it appears the increase is reasonable. Councilmember Green noted he is sure their costs have gone up but asked if their revenues have gone up. Mr. Rogers said they are looking at a cost per customer and on that basis when they look at an increase in program costs; any time they gain a new customer, they have also had an increase cost per customer. He said they are looking at more of a fixed cost on a per customer basis. Councilmember Green asked Mr. Rogers what is their return on investment? Mr. Rogers said he did not have this figure. Councilmember Green asked if that information would not be relevant? Mr. Nathan Gieck, Executive Vice President of Texas Telecable Association, said the company can provide return on investment figures for him and feels they would be well in line. He said what they are here for tonight is simply to recover costs they are incurring without the possibility of making a channel realignment in order to do that. He said they are not trying to increase their revenues as far as taking it home and putting it in their pockets, but are trying to "stay even" with expenses they are incurring from their programmers in order to keep providing quality programs like ESPN, etc., as they continually go up on them and they have to pass on the increase. He said last year, the company tried hard, in discussing this with the city, not to take the 5% they could have taken by law, because they wanted to hold off on it as Long as they could because they are in the entertainment business and they are not a utility. He said people don't have to have their service and they have a lot of competition in this community with the arts, the entertainments, the theatre, proximity to Houston, etc. He said they are in a very competitive business just like many of the business people and this is why they didn't take the cost increase last year. He said the increase they are asking for now has been thoroughly reviewed by the city staff who feel comfortable with it. Councilmember Green said he didn't think just looking at cost is a relevant issue and he really thinks the return on investment is much more important than just looking at costs Mr. Gieck said they are Texas Telecable, Inc. and it is pretty hard to divide it out among all the other companies they have because of the way that it is structured. In Huntsville, for example, he said, they have been here five years and have spent an enormous amount of money in order to bring the system up to a quality cable tv system. He assured them some of their other systems, even though they are supposed to stand alone, had to be financially supported by them. Councilmember Green asked if they calculated a Profit center type of approach per city? Mr. Gieck said they did not and that it is more into their entire company. He said it can be broken out and could probably be looked at two or three different ways, but it is very expensive to do so. Mr. Gieck said they did this to the best of their ability four years ago and the Council found at that time they were well in line He said they are just here as a business like MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 460 eryone else. He said if the dentist charges too much for dentistry, the customers are going to go mewhere else. He said maybe they should have taken their 5% last year, but they have gone along this far thout having to do that. Councilmember Green said his position is that he is uncomfortable essentially ther approving or disapproving something on which he has no data on which to vote. Mr. Gieck said they provided what they thought was ample data for the staff to review. Councilmember Knotts asked how many customers they service outside the corporate limits of untsville, over which the city has no jurisdiction. Mr. Gieck said they serve basically the Elkins Lake rea that just received the service last year. Mr. Rogers said approximately 85 -87 percent of the customers re inside the city limits. Councilmember Knotts noted then some of the costs would be incorporated in from hat area. Mr. Rogers said they do have a higher rate outside the city limits to recover for any additional xpenses they might have outside the city. Councilmember Knotts noted then that would go into the overall osts. Mayor Monday asked if there is a differential rate as to what is charged in the city and outside the ity? Mr. Rogers said there is. Mr. Gieck said the main reason for this is that they feel it costs them a ittle bit more to service that area. He said they do not feel the citizens of any community should bear hose costs and that if they extend their operations to another area, only the people in that particular rea have to pay for it. Mr. Bounds addressed Councilmember Green's concerns. He said traditional rate making is on a fair eturn on investment. He said there are some problems on calculating that to get the expertise to come down o divide the system out and to look at what we have inside the city and there would be some associated xpenses. He said he did look at their annual report for their company as a whole and it is doing well. He aid if we look at this system with regard to the other systems, Huntsville has some of the lower rates for heir system, as compared to the systems around Huntsville. He said he looked at the incremental costs they re passing through versus costs they can actually document per subscriber since the last rate increase; ecause this it is a simpler way to justify the increase they are recommending. He reminded the Council hey did ask for a much larger increase. Councilmember Barrett said last year the Council was given a long list that showed Huntsville to be ,ne of the lower fees in their rate schedule. He felt because of the good attitude they had last year, this ncrease should be approved. Councilmember Barrett then made the motion to approve the ordinance allowing The caption of the ordinance is as follows: ORDINANCE NO. 89-20 AN ORDINANCE AUTHORIZING AN INCREASE IN BASIC CABLE TELEVISION RATES; AND MAKING OTHER PROVISIONS RELATED THERETO )iscussion: Mayor Monday noted she took part in the discussions to review the rate increase request. She ;aid when a comparison is done on what Huntsville is paying for the number of channels it is receiving, it •eally is a considerably lower price than almost anyplace in the state. She said many people in the state ire paying this price for 12 channels. She said in reviewing the materials, she does feel that the 5% that could have normally been taken last year and 5% this year are certainly justifiable. Councilmember Barrett -aid the quality of the cable has gone up also and he appreciates that. All were in favor "except" :nunrilm MKAe r—.. uh. —+.A ".,,, " 6—^..^.. •1.^ ......:.... ^ ^ ^ ^ -J L... - .._._ _c I • .- -- ----- '- _ -'_ -- Mr. Bounds said the second item he has been discussing with Huntsville Cable T.V. is the franchise I. He said about six months ago, the company made a proposal with regard to the renewal of the ise. He said they have been working on a draft the staff could recommend to the council. He said he s to have that proposal prior to the next meeting. He said one of the issues that might be addressed I 1 MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 461 then is what method do we wish to use with regard to future rate increase considerations. Councilmember Green said his "no" vote has nothing to do with whether it is a right or wrong issue; he would just like to see their return on investment and those kinds of calculations in the future on which the council can vote. Mr. Gieck expressed his appreciation, noting they are here to stay, they are not going to sell, to keep the questions coming if there are any, that they are going to try to keep the council from being in the cable business, noting that is their deal. He said if the Council receives complaints or problems, to please let them know as they will resolve them and then advise the Council. CONSIDER GRANT APPLICATION Consider approval of the grant application for downtown proiects to the National Endowment for the Arts (NEA) of a one for two matching arant in the amount of $150,000, as previously discussed Dr. Herb Muecke, Chairman, Huntsville Arts Commission, presented the proposal to the Council. He said this is a grant request for $150,000 to be matched by $300,000 from the City of Huntsville which will enable the city, working through the Arts Commission, to develop and implement a master cultural plan for Huntsville, which would utilize the core of the city as a cultural center for the community. He said the principal components of the proposed program are: 1. Hire a cultural planner to meet with officials of the city, county, university, TDC, schools and Chamber of Commerce as well as with artists, arts organizations, property owners, and others to develop a master plan. 2. To begin the remodeling of a facility for the performing arts, conference and community meetings. 3. To contract with designated artists to paint murals by Richard Haas on the facades of the downtown buildings from the completed designs by Haas. 4. To hire architects and consultants to develop and implement an aesthetic community design in cooperation with the county 5. To add a full time position in cultural development. 6. To play a role in implementing the master plan in order to build audiences for the arts. Dr. Muecke said they feel number five is particularly important as they really need someone that is there, on the scene, to make this program work. He then referred to the City Attorney's memorandum on how the hotel -motel finds may be spent, noting this tax is not fully applicable for use on the proposed community theatre. He then presented the budget for their review. He asked for their approval or comments on the following four points: 1. Approval for a grant application to the National Endowment for the Arts which requires a 5100,000 commitment per year. [He said this is the tax money that has to be committed in order to meet the prerequisites of this grant for a three year period from the local government. He said they are asking for $272,500 from the city and they have approval for $27,500 from the county.] 2. Plan A. Approval to raise the hotel -motel tax by 3% for a three year period for a facility remodeling, with a 1% tax for operation thereafter when a suitable facility is identified; or 3. Plan B. Approval to phase -in an increase in the hotel -motel tax, according to the following plan, when a suitable facility is found: Year 1 -- 0 percent tax [beginning July 1, 1990 to July 1, 19911; then Year 2 -- 1 percent tax ) Year 3 -- 2 percent tax ) to complete the remodeling Year 4 -- 3 percent tax ) Year 5 -- 1 percent tax thereafter for operations 4. Information as to the Council's intent to own a facility and to lease it to a governing board for management if the hotel -motel monies are used. [He said such ownership or management is a requirement in the current legislation regarding the use of hotel -motel tax monies.] ------------------------------------------------------------------------------------ -------- --- ------ - - - - -- MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 462 Mayor Monday asked Mr. Scott Bounds, City Attorney, for his comments concerning the use of hotel-motel funds as per recent legislative changes. Mr. Bounds advised during the last legislative session, the as Legislature adopted House Bill 1023 which made substantial changes to the hotel -motel tax law. He ised hotel -motel tax revenues must be "expended in a manner directly enhancing and promoting tourism and convention and hotel industry," and that use is limited to one of five categorized expenditures, as Lows: the acquisition of sites for and the construction, improvement, enlarging, equipping, repairing, operation, and maintenance of convention center facilities -- specifically civic centers, civic center buildings, auditoriums, exhibition halls, and coliseums (and attendant parking for such buildings) that are owned by the City or that are managed in whole or part by the municipality; the furnishing of facilities, personnel, and materials for the registration of convention delegates [convention staffing]; advertising and conducting solicitations and promotional programs to attract tourists and convention delegates or registrants to the City or its vicinity; the encouragement, promotion, improvement, and application of the arts, including instrumental and vocal music, dance, drama, folk art, creative writing, architecture, design and allied fields, painting, sculpture, photography, graphics and craft arts, motion pictures, radio, television, tape and sound recording, and other arts related to the presentation, performance, execution, and exhibition of these major art forms; {, historical restoration and preservation projects or activities or advertising and conducting solicitations and promotional programs to encourage tourists and convention delegates to visit preserved historic sites or museums: (a)at or in the immediate vicinity of convention center facilities, or; (b)located elsewhere in the City or its vicinity that would be frequented by tourists, convention delegates, or other visitors to the City. Ir. Bounds said, in addition to the above five categories, the law sets minimum and maximum expenditures )ased on the amount of tax levy. He said at the city's current 4% hotel -motel tax, 1% (25% of revenue) is the minimum expenditure for advertising ............ category 3; 1% (25% of revenue) is the maximum expenditure for the arts ...............category 4; 2% (50% of revenue) is the maximum expenditure for historical projects..... category 5. r. Bounds said at the present time the city expends 3% of the tax, or 75 %, for any purpose permitted for tems 1 through 5 with the Chamber, with the emphasis being in category 3 [advertising]; they are esponsible for meeting the limitations on category 3 [advertising], and then 1% is spent on the arts. He dvised if the city increases the tax above 4 %, all additional revenue must be spent on a convention enter -- category 1 4% TAX 7% TAX Advertising - -Min. 1% Advertising - -Min. 1% Arts - -Max. 1% Arts - -Max. 1% Historic - -Max. 2% Historic - -Max. 2% Conv. Ctr. - -Min. 3% Mr. Bounds said in looking at the proposal, whether or not the acquisition of Town Theatre would be a egitimate expenditure of hotel -motel tax monies, absent any special statutory definition, [Webster's ictionary states a theatre is an auditorium and an auditorium is a theatre, generally an auditorium iurposel; if the Town Theatre were used as an auditorium, it would comply with the requirements of the 1 1 MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 463 hotel -motel tax. In addition to meeting that part of the test, he said, it must be operated to the benefit of the tourism - convention -hotel industry. Mr. Bounds advised by special provision of the legislature, the City may by ordinance adopted prior to October 1, 1989, pay less than 1% of hotel -motel tax for advertising if more than 50% of the revenues are allocated for convention center purposes, or may by ordinance dedicate more than 50% of its hotel -motel revenues to historical projects. He noted with the exception of this special provision, the general guidelines outlined above apply. Mr. Bounds also provided a one page summary of some of the otherli provisions of H.B. 1023. The City Attorney said it is hard, based upon the information we have been presented so far, to determine whether or not the proposal for the Town Theatre would comply with the literal requirements of the statute. He said it is going to have to be judged, not just by how we print it, but by how it actually gets used. He said if the Town Theatre is made into an auditorium and in fact we do have conventions booked there and convention delegates come in to use it, then he would think we would have a legitimate expenditure of those funds for that purpose. He noted, however, if the city acquires the Town Theatre and it becomes a home for the community theatre and we have four or five productions in a local theatre over a year, and no conventions, certainly he did not think that would be a legitimate use of hotel -motel tax funds. He said he can establish guidelines for the future to insure if they adopt the hotel -motel tax increase, what they have to do in order to comply with the state statute. He said the Attorney General's office has not yet decided how it will be issuing advisories on questions concerning the application of hotel -motel taxes, but certainly, the council may wish to consult with that office concerning a use that might be suspect at some point in time. Mr. Bounds said given the point where we are in this process, where we are applying for grant funds, it could be structured so that there could be hotel -motel tax monies used for it if it were used for convention purposes and not predominately for the arts. He said the theatre could be acquired with the intent of the statute. Mayor Monday said they all have the same concern in that they want to see the downtown project completed and would like to see activity generated, but at the same time they want to be sure that the activity they get downtown is properly acquired and they do not want to miss -fund with hotel -motel taxes as the city does not want to injure that industry. She said in looking at this and in visiting with Linda Pease, Arts Commission Coordinator, she feels one of the problems they have is not enough information. She said they have a good, sound proposal in an outline form as far as the facility, and the rest of the grant is strong. She said in regard to the town theatre, the information about how it will be used and those sorts of things are still vague and she would be interested in hearing what the Council thinks about this. She felt there are some ways to look at what has been proposed so that both purposes can be accomplished and the city can still apply for the grant this evening. Mayor Monday said one of the things she thinks the council may be able to do is to structure the grant so that, in the first year, the cultural planner and coordinator are utilized to draw up a specific Plan and to look at not iust the town theatre but other possibilities, as there may be other areas there that would work as well if not better to a Possible ioining of the arts and a convention facility [noting the town theatre may be it or it may be the Henry Opera House, or there may something else] and to evaluate their findings after considering all the possibilities, to determine the answers to all of our questions She said we will then be on firmer ground and will feel a little better about, not only the utilization of funds but also how we are going to accomplish the entire project. Mayor Monday advised she has asked the Director of Finance to draw up a memorandum concerning the use of ad valorem taxes or the use of current available funds to fund the downtown project, as an option, should the council decide not to use hotel -motel taxes for this purpose. She then presented this memorandum. Councilmember Knotts felt the city needed a structural appraisal for the use of any building the city may be considering to be sure it is in compliance with the fire and building codes today. He said the city MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 464 will be maintaining the structure if it buys it and should insure that the city does not purchase a matchbox. He felt this information is needed before the city could consider such a purchase. Dr. Muecke said the Commission is comfortable with what the Mayor is proposing, as this way they will have had a chance for architects and engineers on the scene to tell them which of the buildings is more feasible. He said they can structure their grant proposal without being specific on that issue. He noted the grant deadline is midnight tonight. Councilmember Knotts said he feels the council is being rushed into this and they need to think it through thoroughly. He asked for a clarification as to what the council is being asked to do tonight. Mayor Monday said what she is proposing they do this evening and she wants to hear the council's omments because there may be a feeling that the council may wish to put on the full 3% hotel-motel tax or nLy use a part of it. She said one of the thins that can be done this evening is to structure the arant o that there is no hotel-motel tax money in it at all: the city icks that up along with the county, Arts ommission Historical Commission and pays for it and goes ahead and says it is going to commit to ulfitling the grant Without hotel -motel mone • then in the first year because the first Year calls for a ultural tanner and a coordinator those people are used to identify facilities et the answers to the uestions rho s be a grantsman. get additional dollars to go with that to facilitate its development and hen they can bring the city a package at the end of a year or nine months etc. identifying the facility, ith specifics answered on the funding end. At that point, she said the city can then decide if indeed his could qualify for hotel -motel because the council may look at it and decide it cannot do both but it hinks a Derforming center is needed downtown and the council will do it as a performing center and will not se hotel-motel taxes. Secondly. Mayor Monday said the Council may feel that it has found a compatible ituation where it can do both Performing and convention t them to ether and do both or at the end of he vear. it may decide none of the above will work and that part of the grant will drop out and the city ill continue with the rest of he rant: streetsca es murals etc. She felt it aives the Council a three-way option if they structure it that way. Councilmember Gaines reiterated that at the end of the year, this planner, in addition to identifying laces, would they also be identifying programs, implementing programs to see how they work or how effective they are. She asked if the Mayor is saying that if, in fact, the council decides to go ahead with a part of he program, it could do that without any hotel-motel tax at all. She said she is not comfortable at all with placing that much burden on the hotel people. She felt they are so vital to our tourism business and if the council puts so much additional money on them that they cannot operate, then the council has hampered its program as she sees it. She said she would like to be able to identify what the council can do in this rea and possibly the city has funds to hire the planner. She felt the program is wonderful and thinks the ity needs to do something in this area, but to do it with the "least hurt to an industry." She said the .ayor's plan may be the one the council should accept. Councilmember Bell said he agrees with Councilmember Gaines. He said the price of motels is important, oting during his recent vacation, they did get back on the road when the motel prices were too high. He aid he would also like to take the burden off of the hotel -motel people and simply did not want to see the otel -motel tax used this way. He said he quite approves of what the Arts Commission has done and woulc Re to go with the proposal, but if it is a good enough proposal, it should be a general tax burden and not specific hotel-motel tax burden. Councilmember Green said what the Arts Commission is proposing is super and they have done a lot of ood things. He said he is personally not in favor of the hotel -motel taxes being used in this manner, owever, and has no problem looking at a proposal to do some study for a year to see if the council can coam p with some alternatives. 1 Ll MINUTES Of THE AUGUST 15, 1989 MEETING BOOK "P" 465 Councilmember Knotts said if we are going to do this downtown project, the Council should look at the possibility of the city taking over its own visitor and convention bureau and operating it itself, with the current hotel -motel tax money it has or a bigger percentage of it, in conjunction with this downtown area. Councilmember Barrett felt the Mayor's compromise is a good one and felt it would not close out the project the Arts Commission is doing and yet it would not overburden the hotel -motel people. He felt the Council needs to adopt this tonight before the deadline. Councilmember Carter said he is not comfortable with the lack of information so as to commit $450,000 either by the 3% on the hotel -motel people or out of the city budget. He felt the city is putting the cart before the horse. He said he is in favor of the project and wants to see it done, but it seemed to him that if we are going to spend a year planning anyway, and the city does not know where it is going to end up at the end of that year, that the city should not commit $450,000 tonight. He felt the city should hire a planner at a smaller fee, $18,000 or $20,000 [lady from New Orleans or someone else who has some national recognition and skills] and then spend a year planning. He said the council does not know now what it will have anyway at the end of the year. He said it does not sound like the city is going to move ahead very quickly anyway or put in a community theatre or anything else very soon. He proposed to scale back and bring the cultural planner in to look at the whole city, the historical preservation, other structures, community theatre, community projects, and then at some later date, decide whether the city wants to commit $400,000 or $450,000 or some other large amount for this type of project. He said he would not be in favor of committing tonight to spending that kind of money without more information about what the city intends to do. Councitmember Barrett said he didn't mean to commit the $450,000 tonight, but rather to approve the compromise type plan. Dr. Muecke said much of this discussion is revolving around the theatre per se, but that is just one element of the overall plan. He said we have spent more time talking about it because it had more loose ends as to whether the city would own it, which building will it be, is it structurally sound, how much will it cost to repair, can it be funded with hotel -motel taxes, etc. He said the Arts Commission feels this is a substantial program even without this building. He said all the arts money [NEA's $50,0001 would be going towards doing the facades downtown which is a major enhancement of the downtown area. Councilmember Knotts felt that if the city is going to apply for the grant and is given the grant, then the city is obligated for $272,000. Dr. Muecke said there is no question about that. Mayor Monday said if we apply for the grant this evening and authorize the funds, the city is going to accomplish a number of things beyond and above the center itself, i.e., the facade plan for downtown, the streetscape, and a number of things will be accomplished within the plan. She said there is also the flexibility down the line of altering the grant itself, if necessary, so that if the intent now is to go ahead with the performing center, we would go ahead and explore that possibility, work toward the development of that as well as the convention center. Councilmember Green said he thought we were looking at an alternative to the proposed plan that would be done out of the regular city budget. Mayor Monday said that is correct. She said the city is looking at the same plan the council reviewed in its work session last week, but with no funding coming out of hotel -motel taxes and all of it coming out of the city budget, the county, and all the elements that are there. She said what was hotel -motel would now come out of the city budget. Councitmember Knotts said if we are given the grant, next year's money will come out of the city's budget too? Mayor Monday said it would be a three year commitment. She said what the city will accomplish is that there are a number of elements included in this other than a performing center. She said at this point, we have Mr. Haas' plan ready to go and implement, a number of merchants ready to implement their plans, the county has come on board to develop the historical spring, we have the streetscape program, and a number of elements that do impact and hopefully renovate and revitalize the downtown - -all ready to go, awaiting the implementation of this grant. MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 466 Mayor Monday said in regard to how to finance it out of the city budget without using hotel -motel taxes, the council needs to talk about that now if that is the question. Councilmember Green said that is not completely the Question but that he is confused because he understood the city is not going to commit to buy a theatre and if that is true, where is this money going to be used? He asked if the Commission has something the Council can look at because he is having trouble following this. Dr. Muecke said the Commission said they just do not want to identify that in the grant because it is still their plan to proceed. Councilmember Green said he is not going to vote on something he cannot identify. Councilmember Knotts said he would personally be against spending any public money on the facade painting. Dr. Muecke said this is the reason they structured it the way they did. Councilmember Knotts felt, however, that point is still vague. Mayor Monday said all of the money from the National Endowment will go for the facade work and there is no Huntsville money in the facade painting. Councilmember Knotts felt the city could not look at this for a year and then, if it is not feasible, to back out of it if the city gets the grant, because if the city gets the grant, it has to go on with it. Councilmember Knotts asked if the NEA gives the city $150,000, can it back out of this whenever it wants to? Mayor Monday said the City does have the flexibility.. She asked Ms. Pease to address these concerns. Linda Pease, Arts Commission Coordinator, said in regard to the city's obligation to the theatre and where it is in the budget, if the Council will review the budget detail it will see a listing under each year for an amount that says downtown facility. She said they did build in an amount so that if, when the cultural planner comes in, a suitable facility can be identified, then the city will have identified monies within the grant that it would propose to use. Councilmember Green said the city is committing money to buy something. Ms. Pease said it is in the plan at this point. She said she has talked with the Director of the local program at the NEA regarding the fact that the city is building in the cultural planner as a part of the plan, and could the city, if it finds it needs to, based on what the planner determines, change the plan. She said the NEA said "of course" and that this was logical and the NEA will need to see what the city is thinking about, but if the planner comes in and the city changes its direction based on what that person is telling the city and what the city finds in their downtown that it needs to do, then the city can do that. Ms. Pease said in the city's more detailed narrative provided to Council last week, they have included a note after that section to say "since the development of a cultural master plan is a part of the grant request, it is understandable that certain aspects of the proposed program may need adjustment, especially in years two and three." She said the NEA has allowed the city this option and the city is not saying "yes" it will buy town theatre or any other specific facility. Councilmember Green asked what if we don't want to buy anything Ms Pease said then she feels the money will be used for something else. The city would still have to make the match for $150,000, but then it would not have to go forward to do the .theatre itself. Councilmember Bell asked if we could do streets or put in red sidewalks? Mr. Bounds, City Attorney asked to address this question, because he had the same basic concern. Mr. Bounds said in looking at the grant documents, it occurred to him that if, after the first year, the Council decides this is not a good grant and it does not want to put any more money into it, what happens then. He said one thing is obvious from the grants - -the city may be declared ineligible to receive future grants from the NEA - -that is the first thing. NEA could declare the city ineligible to receive federal funds through the arts programs and perhaps other related programs. He said it could affect the way the city's applications for future grants are considered by the federal government. He said if the city makes one proposal and does not live up to its obligations for reasons the NEA deems unreasonable, then this may affect the city's ability to get future grants from them for some period of time. Councilmember Bell asked if the city's only obligation is to spend $92,000 a year? Mr. Bounds said this is right. He said the way the grant is going to work is that the city and county are going to have to show they have spent $100,000 before they will receive any federal funds in the amount of $50,000 for that year. He said if after the first year, the city determines, after expending $100,000, it wants to terminate the contract, the city is not obligated to spend another $200,000, but the city may not receive the arts match for the money the city has put into the program and the NEA may withdraw any future match. Mr. Bounds said the NEA will have to approve any expenditure the city makes that would qualify for their match. He said if the city terminates the program, it could then spend those tax dollars for any purpose generally authorized for the 1 L' MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 467 use of tax dollars, but the city will not receive matching federal monies. Councilmember Bell noted the the city can spend its money paving streets and redoing sidewalks, but the NEA might not approve of it Mayor Monday said the money can still be dedicated to the downtown and to do those things outlined in th plan. Councilmember Knotts said if we are just going to spend money downtown, he'd rather see the cit spend it on parking. Mayor Monday said parking.;s a very big part of the grant. Councilmember Carter asked why the city should commit a whole project tonight if it is going to hav, flexibility and to reserve flexibility over time. He said the Commission wants to ask for $90,000 o $100,000 to do something downtown or several different projects and we may fund it out of the budget anyway He asked why the city doesn't want to see these things done rather than commit everything tonight and thei try to adjust within the boundaries within which the city may lock itself. He said this was his poin earlier and this is his point now. He said he probably will not support the grant tonight because if the city is going to spend the money anyway and it is going to come out of the budget, he felt the city shout look at individual projects and see what worth they have. Councilmember Carter said he won't support the Possibilities in terms of getting the grant and not following the grant etc He said he is not agai spending the money and the city may want to spend $300,000 downtown, but the city should look at individ projects and look at what it is doing as it goes along. He said the city needs to get the cultural plan in and talk about the whole city in this sense. Councilmember Knotts felt this was being done with too much haste. He asked if this would be Life-time opportunity on a grant or will this opportunity come back some other time. Ms. Pease said for a couple of years the Arts Commission had been meeting with various groups to try t plan for the downtown and also attending some successful downtown meetings- -about four conferences including the National Mainstreet Meeting and others. She said the components of this plan are based o meeting with tourism groups and museum groups and downtown associations, community theatre, and other art organizations here, economic development council, and a number of people had a sequence of meetings. Sh said the components listed in the plan are based solidly on the things they have been told and have listen to and comprise the "magic mix" the city needs for a successful downtown. She said the theatre is in her because on of the components needs to be something that will make people stay downtown in the evening tha will get people walking so that there is foot traffic and then other things will open up such as restaurant: and gift shops, etc., that would stay open along with the theatre. She said if people stay for the theatr in the evening, then they spend the night. She said the City of New Waverly may be interested in developin tour packages in conjunction with Huntsville so that they can all work together on this. She said thi components are solid. She understood the Council's concerns about the theatre and they have talked with thi NEA about this and that is why they have said the city can change its budget. She said to answer Councilmember Green's and Carter's questions about whether it might be just as well to spend the money, the city would stand to get, if it is awarded this grant, another $150,000 so the city could have a total of $450,000. She said there would be no obligation to Purchase any specific theatre or facility, however, the reason the auestion was addressed to the council would be so that the Arts Commission would know if the council has a willingness to Pursue the Possibility of the city owning a theatre and this would only be a concern if the city were to enact hotel -motel tax She said if the city does not enact that Portion of the funding, then the theatre could be a Private board or organization that would own the theatre and hopefully bring in groups that would keep the theatre booked both for conferences and for performing arts all year. She said it is a vital thing to have the support of the NEA for the reason of extra dollars and also for more leverage in going for other grants With the theatre, she said, this is something where the city has a year to wait until it even begins this grant and it can certainly continue to investigate possibilities. She said after another year, the cultural planner would come on and work with the staff for a year. She said the city has some monies built in for this year so that if a suitable facility is found, then the city can have monies there, rather than getting to that point and a suitable facility is found, but all of the monies are designated for other projects, such as sidewalks, architects, and Haas' paintings. MINUTES Of THE AUGUST 15, 1989 MEETING BOOK "P" 468 e said the Arts Commission felt it needed to have it in there. She said they had to show a three year dget because this is a three year plan proposal, however, Mr. Huff, NEA Director, has said that the city uld certainly have the option of coming back. She said the first part of the proposal is to bring the ltural planner in and that may very well show the city that it does not need a facility there, but rather eds it somewhere else. She said one of the critical things about the sidewalks and some of the other hard nds of improvements is that the city needs to show in the grant proposal that those are vital to more cessibility to cultural events. She said if the city has some center for cultural events there, it is ch easier to show that we need the sidewalks and street improvements. Mr. Scott Bounds, City Attorney, emphasized that the Council is not making a commitment on revenues night but is basically authorizing an application process. He said normally, if the application is proved, the city would work out or develop an agreement for that grant at a much later time. Ms. Pease id the city would know about acceptance on March 1 and then the contract would come. She said the city is t obligated to spend any funds until the contract is signed. She said there would be, of course, the good ith of the intention to do that. Mr. Bounds said it is not uncommon for the city not to develop a tailed agreement until the grant has been approved in general terms and the city then basically negotiates e specifics of the agreement and usually they do have funding clauses in there subject to funding yearly. said the city would have from now until March to continue to work on this proposal. He said some endments to an application that is pending would not be unusual. Mayor Monday said the Arts Commission has come to the City with a proposal that has probably the oadest base of support she has ever encountered and has brought many, many elements together focused on e downtown, on its revitalization, and on its restoration. She said they have done this with experts with tional and international and certainly statewide recognition. She said they have brought us the very best at we can have here this evening on a unified approach for the Council's consideration for an application r this grant that could be the facilitator for this. She said she would have a great deal of difficulty t going forward to apply for this grant. Councilmember Carter said again he supports everything the Arts Commission has done and he will support em in the future. He said he will stay with what he said earlier. He said the only problem he has is ire talking about. He said he appreciates the work and supports what is being done and he will it as it goes along, but for this evening, he felt it was too much to ask for in one evening. Councilmember Gaines clarified what the Mayor is asking the Council to do tonight is to say that the ty does feel it could spend this money and if the grant is issued, the city is not committed to doing this her than just a good faith commitment. She said then if the city decides not to proceed, between now and e time the NEA approves the grant, the city does not have to do anything. She asked if it is understood re that the city could withdraw that application if, after the city has reviewed what it is talking about re in this interim period where it can really get some information on it, it decides it does not want to this? Ms. Pease said the city is not obligated until it signs a contract. Councilmember Gaines said en the city does have from now until March to do some studying to determine if, in fact, this is what the ty wants to do and the city is not really committing itself other than saying that it possibly can do is. She asked if she is correct in this thinking. Ms. Pease said while the city is not committed until has a contract, in all fairness, when the application is signed by the City Manager, it indicates the ty has funds designated for this project. She said there are, however, many times when people drop out of ants and do not meet them. She said when the city had its three year grant with the Texas Commission on e Arts, there were eight cities that were not able to make their grant; Houston being one of them. She id those things happen all the time. She said the intent ought to be there, however. Councilmember ines said then the intent as opposed to an actual commitment is what we are saying; that we are just ying we have an intent to do this and hopefully we will be able to proceed. 1 1 MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 469 Councilmember Knotts said if we are given a $150,000 grant, the city is committed to spend $300,000 Councilmember Gaines said this is true if the city goes ahead with the contract. Councilmember Knotts Proposal would look even better. and Councilmember Gaines seconded the motion. Discussion: Mayor Monday noted then the city is going tc tell the Arts Commission to mail this proposal tonight. She said the city may find down the way that, after serious consideration of the options that have been stated, that it can withdraw, or it can send it alternate options to the proposal. Mayor Monday said if the grant is awarded, the city will then have the opportunity to accept it with a final commitment for the dollars. Mr. Bounds said the city would then have a grant agreement it would approve between March and July of 1990, and all the individual expenditures that were approved by the grant would have to be agreed to as a part of the contract. Councilmember Bell notec the city will have eight months to talk through this town theatre possibility and this is the part with which he is not comfortable. Mayor Monday said the city will have more time than that as it will have the whole first year of the grant to review this [approximately 18 months]. Councilmember Barrett noted each year this grant has to be renewed; in other words, the city could drop out and does not have to complete it. Mr. Bounds said usually the funding is on an annual basis; noting if the city spends $100,000 in year one and gets $50,000 from the national government, there is usually a funding clause in the contract that it is subject to funding for each subsequent year, so if the council does not fund it, the grant terminates at the end of that first or second year; the Council will have the opportunity to approve it each year. basis. Councilmember Knotts said the city should not back out of it once it accepts it as if it is a year plan then it is for three years. are going to be doing from then on is lust finding out how we are going to spend it Mayor Monday said that is not true as we do have a set plan and we do have dollars that are designated for everything from paintings to nominations for an historical register, site plans, and we have it down to the dollars that are going to be used. She said the only question that is not delineated is the facility itself and the wav this said at this point we have the flexibility to alter it if necessary. She said the plan is "very detailed "', and "very specific" on where the dollars go. Councilmember Carter asked what is the commitment on dollars' for the facility. Ms. Pease referred him to the budget detail. Dr. Muecke said he understands their concern over the unknown quantity and noted they have spent most of their time talking about the theatre because that is the fundamental issue and has the most loose ends about it as to where is it going to be and which one. But that is just one element of this plan, he said, and they have not spent the night talking about the non- controversial items which they feel are equally worthwhile. Mayor Monday said as she reads the downtown facility, in year one, $18,750; year two $33,750; and year two, $33,750; and year three, $36,000. Ms. Pease said that is correct and noted there is a detail of the proposed plan if there are any questions. Councilmember Carter said the Arts Commission has his commitment to spend this money, but not in this unified plan and not a commitment tonight. He said he would hope that when the city applies for a grant, it is telling the people who will judge us that we want to do this. He said he wants to do all of these things, but is not ready to make this type of decision on the information he has heard tonight, with about $80,000 still unclear as to what we are exactly going to do. He said he appreciates their work very much, but was going to vote against it. MINUTES OF THE AUGUST 15, 1989 MEETING BOOK °P" 470 Dr. Muecke emphasized, in order to put the theatre in context, the proposed plan is to develop and implement a master cultural plan for community liveability under the guidance of Marian McCollum of New Orleans [the cultural planner they have identified with the NEAT, who will have at her disposal, a series of studies and information completed by citizen groups, City, Chamber and the 1986 Huntsville Arts Festival committees, as well as data gathered during previous grants. He said the five points, of which the theater is number one, are: 1. to develop the downtown as the cultural center: a. to restore the town theatre [to be modified with help of cultural planner, if necessary]; b. to contract with designated artists to implement the Haas architectural illusion designs which were developed to meet the particular design needs of downtown Huntsville [He said this will be step three of which the Commission has gone through the first two steps with Mr. Haas of New York in. conjunction with the historical architect from Austin, Mr. Kim Williams. The project is now in the second phase and interested property owners are now working jointly to finalize the plans in order for the property owners to make improvements in preparation for the Haas design, he said. Dr. Muecke said when the Commission met with the downtown business people, it said it could not make promises about grants, but it was going to make every reasonable effort to look for grants. He said it looked at this grant proposal as supporting what it has, in a good faith effort, made with the downtown business people, as far as their interest in their facade design with Mr. Haas. He said the city would hold facade easements for an agreed period of time where public funds are used. He said they are trying not to use public funds on the wall and are going to pigeon hole the grant money for the facades, so there will be no problem using public money on a private thing.] c. Retain Kim Williams [restoration architect] to work with Richard Haas to develop the current site plan and to work with other professionals to develop a master streetscape plan. [He said this is for sidewalks for easy access for handicap people; making it attractive; location of utility poles; decorative lighting; benches; landscaping, etc., to have a plan for when the money becomes available. This plan will result in the implementation of parking and sidewalk projects, he noted. Dr. Muecke said one of the things they truly feel is important, even from an artistic, cultural point of view downtown, is the parking as that is needed if we want the people to use the downtown. He said they fully expect this to be a major element of their streetscape architecture, which will provide easy accessibility to the Square, the museum and cultural events. He said presently, there are no marked handicapped spaces on the square; several of the sidewalks are set three steps up from the street level which makes access difficult. He said the plans calls for the cooperation of the city and county, etc. He said the Arts Commission has cooperated with the Walker County Historical Commission and they have been very cooperative and feel supportive of this downtown plan. He said they do have funding, as an element of this grant, to support their efforts there to bringing in an expert to be precise here to survey, where needed, to assist the Walker County Historical Commission with its funding for an historical survey, preservation plan, and nomination to the National Register. He said the Texas Historical Commission has visited with Huntsville to report that the county should have about 900 historical structures. He said the Texas Historical Commission provides assistance into planning and offers grants on a matching basis, with local matching funds being provided through this grant. He said this is a small percentage of the grant money, perhaps 2 -3 %, but it is an important element of the proposal.] d) Employ a downtown manager who will be responsible for working with various groups and individuals to achieve its goals for downtown and its cultural development. [Dr. Muecke said they feel this is viable and they are going to tie all this together by having someone in place whose sole responsibility is to look after things downtown. He said promotion, marketing, coordination with the Chamber of Commerce as well as fund raising for the proposed theatre center will be facilitated through this position in the grant.] Finally, he said, efforts of a general nature concerning the objectives of the Huntsville Arts Commission are in the plan to further develop arts proposals. He said there is some leeway so that if the MINUTES OF THE AUGUST 15, 1989 MEETING BOOK "P" 471 theatre is obtained, they might use some of the money for artistic groups to come in and get the show off with a bang. He said they would like to have another two months to finalize the details on the performing theatre aspect, but unfortunately they do not have that time. Councilmember Howard felt the committee has done a wonderful job and in hearing all this, he is wondering if the Council wants to sit by and watch Huntsville slow down or defeat itself. He said if the city feels this will really help the community grow in pride, etc., the city should support the efforts of the Arts Commission. He said he was uncomfortable about using the hotel -motel tax, but he believes over a period of years, the city can manage to support this project. Councilmember Barrett said they have asked the downtown merchants to upgrade their buildings, to spend money on the downtown area and to get Huntsville viable again. He felt the city has gone this far and it needs to go ahead and complete this and keep in tune with the times and go ahead and approve this tonight. He said he intends to vote for it. Councilmember Carter said it should not be assumed that those who might not vote for this plan tonight are against the project. He said no one who may vote against this is against any part of this project; the problem is, we are going to adjust this plan. He said the Council does not know exactly how it is going to spend this. He did not want to see the council rush through this tonight. He said he resents being put in a position where others think they are in opposition to this plan because that is not the case. Councilmember Barrett said one thing he is voting for is that it is not fixed and it can be changed and modified. He said that is the only reason any of them would vote for this. He said if it was all tied down with no flexibility, the Council certainly would not consider it because it may not be feasible economically. He said the way it is laid out tonight, it can be feasible and it can be flexible and the city can stop it at any time. He said if the council was committed tonight for the next three years, he certainly would not vote for it. Councilmember Howard asked if we are saying go ahead with the application and apply for the grant. Mayor Monday said that is correct. Dr. Muecke thanked the Council for their time and consideration. All were in favor of the submission of the grant application except Councilmembers Knotts. Carter and Green, who voted "no." and the motion passed by a vote of 5 to 3 [note Councilmember Hammock is absent]. CITY MANAGER'S REPORT Presentation of the Utility Rate Study Information Mr. Scott Bounds, City Attorney, presented the utility rate study information from the consulting firm of Willis, Graves and Associates of Austin. He said the staff's recommendation will be available for the next meeting of the Council. Fire Department Response Accident Mr. Bounds noted as a result of the executive session discussions, he is asking the City Council to authorize the City Manager and City Attorney to settle all claims for property damage and personal injury as a result of an accident that occurred on July 4, 1989 in an amount of not more than $6,000. Councilmember Barrett made the motion to approve of this settlement and Councilmember Howard seconded the motion All were in favor and the motion Passed unanimously. Adjournment idly submitted, Ruth DeShaw, City Secretary August 15, 1989