MIN CC 01/20/2009CITY COUNCIL MEETING of JANUARY 20, 2009 BOOK "U" 171
MINUTES OF THE HUNTSVILLE CITY COUNCIL JOINT WORK SESSION HELD ON THE 20TH DAY OF JANUARY,
2009, IN THE CITY HALL, LOCATED AT 1212 AVENUE M IN THE CITY OF HUNTSVILLE, COUNTY OF WALKER,
TEXAS AT 6:OOPM.
The Council met in a special joint work session with Walker County Commissioners' Court and the TIRZ No. One Board with
the following:
COUNCILMEMBERS PRESENT: J. Turner, Wayne Barrett, Tom Cole, Charles Forbus, Melissa Mahaffey, Lanny Ray,
Dalene Zander
COUNCILMEMBERS ABSENT: Clarence Griffin, Mac Woodward
CITY OFFICERS PRESENT: Bill Baine, City Manager; Thomas Leeper, City Attorney; Stephanie Brim, City Secretary
OTHERS PRESENT: Walker County Judge Danny Pierce, Commissioner Robert Earl Autery, Commissioner BJ Gaines,
Commissioner Tim Paulsel, Commissioner Bobby Warren, TIRZ Board Member David Moorman, Dr. Richard Montgomery
CALL TO ORDER [6:OOpm]
Mayor Turner called the meeting to order.
PLEDGE OF ALLEGIANCE to US and TEXAS FLAGS, INVOCATION
' Councilmember Barrett led the invocation.
WORK SESSION
The Huntsville City Council, TIRZ No. One Board and Walker County Commissioners Court held a joint work session
consisting of open dialog to assess performance and viability of Tax Increment Reinvestment Zone No. One, and tax
increment reinvestment zones in general.
Mayor Turner stated that a burn ban had been placed in effect for Walker County as of 5:OOpm; and opened the meeting,
stating the work session was to be a forum to exchange ideas. He then recognized Councilmember Forbus.
Councilmember Forbus stated he was happy to see so many attending the joint work session including various media
representatives, and proceeded to review the events of the work session held on October 28, 2008 and subsequent news
coverage. Councilmember Forbus stated dissatisfaction that the Item did not cover the negative results of the Ravenwood
Project — highly reduced benefits to the local school district, no housing being built, etc. He also discussed the Interlocal
Agreement with Walker County and the reported potential threat of litigation in the Item, and stated he hoped the coverage of
tonight's meeting covers the whole gamete of issues.
Mayor Turner suggested that the participants follow normal decorum and for anyone who wishes to speak to be recognized
by the Mayor.
Commissioner Gaines questioned going back on what [City and County] said we were going to do, referring to the purchase
of the property and its intended development.
Mayor Turner clarified that (1) the City took action on the 380 agreement, and has not taken any action to date on the TIRZ;
(2) the TIRZ requires approval to be assigned to a different owner, and the developer stated at the work session on October
28, 2008 that he did not intend to build the residential portion; and (3) the City has a history of cancelling these types of
agreements when not effective, referencing the Curtis — West Hills Park development.
Commissioners and Councilmembers continued discussion on the residential area of the Ravenwood development —that no
public infrastructure has been installed /built, that the property had been identified as for sale, etc. Discussion continued at
. length on clarification of the City's action on the 380 agreement, and the removal of the residential portion of the Ravenwood
project from the TIRZ.
TIRZ Board Member David Moorman asked about the prospect of another developer coming to ask for TIRZ or other
incentives with respect to economic development, and why the City would eliminate the existing TIRZ as a tool.
Councilmember Forbus discussed the impact of the TIRZ with respectto inflating property values and stated he thought no
one on Council would be opposed to a reasonable project if another one is brought forward.
Mayor Turner reiterated that part of the work session was to review the past five years' performance. Mr. Moorman brought
up the expense of setting up the TIRZ and the difference between cancelling a project and reducing the TIRZ itself.
CITY COUNCIL MEETING of JANUARY 20, 2009 BOOK "U" 172
Gouncllmemoers Manatrey Clari led that the Gouncll's actions were to eliminate potential reimbursement for residential
improvements that should only be paid for from commercial development efforts; and Councilmember Ray clarified that the
Ravenwood project required the additional incentives to be viable because of the sales price of the land, not the market
value, and the project has been scaled back, not eliminated. Discussion continued on the other benefits not realized —other
development in the TIRZ, benefits to the school district, etc.
Mayor Turner directed the discussion to the general consensus on the use of a TIRZ as a tool for development for the City
and /or County. Several Councilmembers indicated they would offer incentives including the use of a TIRZ to developers for
realistic projects. Some discussion centered on cost of implementing other TIRZ or other incentives, although no dollar
amounts were mentioned.
Councilmember Autery indicated he would prefer notice the County be given notice if the Citywas going to take action on this
type of matter. Councilmember Ray indicated no slight was meant to the County, but the City's actions to date did not
include the County 1380 agreement] and didn't even know the interlocal agreement even existed. Councilmembers and
Commissioners discussed further the lack of residential development in the Ravenwood project.
Commissioner Paulsel asked if the interlocal agreement expired by time or performance. Walker County District Attorney
David Weeks stated he advised Commissioners Court that the interlocal is still a valid instrument and should be considered
as such. Councilmember Ray stated the interlocal was void if the requirements were not metwithin three years. Discussion
continued on whether the interlocal was still in effect or void.
Councilmember Forbus asked if the County was considering litigation against the City. Mr. Weeks replied to not believe
everything you read in the papers, but that is a decision for [Commissioners Court]. [It was somewhat agreed that the threat
of litigation was over reported in the local newspaper.]
Councilmember Barrett questioned not hearing more from the initial proponents and supporters of the Ravenwood project,
stating that some even assumed the position of a rally around the developer, and some still thinkthat Ravenwood is going to j
be a boondoggle for the school, that those who most highly touted this project are now deafeningly silent. He reiterated that
the Council is trying to set the record straight, to stick up for the citizens.
Mayor Turner reiterated that the City has had the TIRZ in place for almost five years, and the interlocal had language with a
three -year deadline, that the City has given this project almost five years with only disappointing results, and asked at what
point do you say enough is enough? He indicated a strong feeling that this isn't working.
Discussion continued on when the land was closed on [March 2008]; whether the interlocal was still in effect; clarification that
the front 60 acres —the retail portion of the Ravenwood project is still in the TIRZ; property values versus sales price when
property is located within a TIRZ; and the developer's own affirmation that he was not going to build the residential portion of
the project.
Commissioner Paulsel posed the concern over litigation [by the developer]. When they [developers] sue the County, the
taxpayers pay for that. What can we do to limit our liability at that point? Mayor Turner stated we are the only people with
our name on the Property Commerce deal [City], and if the County would like to make the case to keep the TIRZ around for a
longer period of time, to come to us [Council] and make the case. Discussion continued on the project being sold to the
community filled with unrealistic expectations. Councilmember Ray also questioned why more people aren't mad that what
they pushed for turned out to be wrong.
Commissioner Autery started discussion on the developer's actions based on the City's actions, whether the TIRZ is
transferable [with City Council approval], whether he could sell the property orbe reimbursed, etc. Councilmember Mahaffey
stated the City merely modified the contract to more closely match the actual work being done on the project.
Councilmember Barrett also stated the developer wouldn't be out any money, because he wasn't going to get reimbursed
because he wasn't going to build the houses. Councilmember Barrett continued that when we [City representatives] met
[with the developer], the property had been listed for some time with an apartment realtor at the same time he had a contract
to build the single family houses; the developer had a contractual obligation to the City, and Council felt like they had to
respond in some way, not just do nothing. Councilmember Mahaffey restated that the fear was that the developer was
going to try to be reimbursed by the money for public improvements.
Commissioner Gaines stated the same concern as Commissioner Paulsel - litigation against the County. Councilmember
Ray pointed out that one can't sue for damages that wouldn't have ever been incurred. Mayor Turner asked Mr. Leeper to
discuss lawsuits. Councilmember Ray mentioned the City Attorney had sent a letter to Property Commerce to that effect. ,
Commissioner Paulsel requested copies of the letters [which will be provided].
Councilmember Barrett stated he hoped we [City and County] can find we are in agreement on how to respond to this, for
economic development in this community — that it is important for City and County to work together on other things. li
Mayor Turner reiterated an earlier question - that if the County feels the City is being hasty, how long do you have this [TIRZ]
in place before modifying it in some capacity? Judge Pierce and Mayor Turner discussed at length the County's versus
City's activities [such as the 380 agreement], the entire TIRZ area, eliminating the TIRZ to return the prices back to market,
etc.
CITY COUNCIL MEETING of JANUARY 20, 2009 BOOK "U" 173
Mayor Turner restated that the TIRZ has been in place for five years, and we {city] are disappointed w/ results. How long do
we keep it? As the TIRZ is laid out geographically, it has retarded growth by raising purchase price of property contained
within. Judge Pierce asked what will happen to that land once it is taken out. Councilmember Ray stated that is somewhat
unknown, but if you leave it in, nothing will happen, because according to the developers the landowners will hold you up for
the price.
City Manager Bill Baine commented about the TIRZ in general and the reason it was implemented in the first place, and
stated pleasure that Huntsville has finally got some development, that some things may not have been done in the best
manner.
Mayor Turner and Councilmember Ray commented that enough time has passed to recognize it isn't working, that the
current TIRZ has actually stopped growth, and it's time to move on.
Mayor Turner called for any closing remarks.
Councilmember Cole stated he would like to have a determination on whetherthe interlocal agreement is in effect or expired,
questioned the cost of keeping the TIRZ; indicated sometimes when something is not good, it is better to stop it and start
over; and each group should try to do it better next time, for the community and economic development in general.
Commissioner Paulsel stated that this has been a City project since day one, but the County was asked to be partners; he
appreciated Dr. Barrett's comments that the City and Court get along. Councilmember Mahaffey stated she did not know
who was keeping in touch with [the County], and both entities need to be more proactive in letting each other know what's
going on.
Judge Pierce agreed with Commissioner Paulsel that this is out of the County's hands, and as long as the entities we live in
good faith with the developer and take care of the discrepancies, the remainder of the TIRZ lies completely with the City.
Judge Pierce stated he didn't think the County would entertain litigation against the City, that litigation certainly wasn't
discussed, and the County wants to be good partners.
' ADJOURNMENT [8:23pm]
Mayor Turner thanked everyone for attending, and adjourned the work session.
HUNTSVILLE CITY COUNCIL SPECIAL SESSION
CALL TO ORDER [8:35pm]
ITEMS FOR CONSIDERATION
a. Presentation, discussion and /or possible action on Ordinance 2009 -15, amending or repealing Tax Increment
Reinvestment Zone Number One, created by Ordinance 2004 -08 -03.1 (2004 -16), excluding that area designated for
the retail portion of the Ravenwood Village Project.
passed 7 -0.
b. Presentation, discussion and /or possible action to ratify the terms of employment agreement with Theresa O'Brien to
provide municipal court and prosecution duties.
Mayor Turner reported that City Attorney Thomas Leeper's last day will be Friday, January 20, 2009, and in order
to keep Municipal Court running smoothly, City Manager Bill Baine was asked to find someone to handle prosecution
duties for a 90 -day period at a cost not to exceed $3,000 per month. Mr. Leeper clarified that the agreement was not
explicitly for 90 days but until a permanent City Attorney is selected or with 30 days' notice. Councilmember Mahaffey
requested clarification that there are no benefits, the contract is a flat fee only [yes]; Councilmember Cole asked if the
attorney is local [Mr. Baine replied yes], and that they have a private practice [yes].
The motion passed 7 -0.
C. Presentation, discussion and /or possible action to authorize the Mayor to enter into an agreement with PosaBarls,
May, Cron & Cavin, P.C. for legal representation of the City of Huntsville as Interim City Attorney.
BOOK "U"
Mayor Turner introduced representatives from the Ross Banks firm, and stated the plan was still to look at fines
as well as individual lawyer applicants in replacing the City Attorney, and that the panel would be interviewing in order to
make a decision within the next 30 -60 days.
The motion passed 7 -0.
d. Presentation, discussion and /or possible action on the minutes of the City Council meetings held on October 28 and
November 11, 2008.
Councilmember Ray moved to approve the minutes of the City Council meetings held on October 28 and
November 11 2008: and Councilmember Forbus seconded the motion.
Councilmember Ray pointed out the fallowing corrections /changes to the minutes: that Councilmember
Woodward was NOT present, and to add a note that a transcription of the meeting is attached. City Secretary
Stephanie Brim was instructed to send a copy of the transcription to Walker County along with copies of the City
Attorney's letters to Property Commerce.
The motion Passed 7 -0.
ADJOURNMENT [8:44pm]
Mayor Turner adjourned the meeting.
_ Ste*Alie A. Brim, City Secretary
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