190  CITYOFINGLESIDE SPECIALCITYCOUNCILMEETING MINUTES SEPTEMBER17,2024  OpeningA Agenda  1. Call Meeting to Order.  The Special City Council Meeting of the City ofl Ingleside was called to order by Mayor Pro Tem Long at 6:30 p.m. on September 17, 2024, at City Hall 2671 San Angelo Ave.,  Ingleside, TX and live video streaming.  2. Roll Call.  With Council Members present a quorum was established.  Council Members Present: Steve Diehl, Stewart Wilson, David Pruitt, John Salinas, Mayor  Pro-Tem Tracy Long, and. Julio Salinas. Absent: Mayor Oscar Adame  3. Invocation.  Council Member Pruitt led the invocation.  4. Pledge ofAllegiance.  Mayor Pro Tem Long ledt the Pledge of Allegiance to the U.S. flag. There were no Citizen Comments presented for this meeting. Presentation on the Water and Sewer Rate Study.  5. Citizen Comments and Reports.  Presentations  City Manager Lewis stated that the water and sewer rate study completed by HDR, Inc. hadt the 3% transfer ofs sewer service: revenue that willi increase the funds available for debt Grady Reed, the presenter for HDR, Inc., addressed the Council about the water utility rate increase. Explaining that assuming the projected 3,352 connections for FY2025: for water use, limited growth projected for utilities of 1.0% per year, and last year's rate increase of 5% helped revenues to meet expenses, and the five-year water Capital Improvement Projects (CIP) total $8.5M: for next five (5)years, with limited projects inl FY2025. With wastewater therei ist the same growth rate as water assuming the projected billing units are 4,4991 toi include 1,3461 Multi-Family Dwelling Units (DUS), a growth rate of1.0% per year, and with $20M for capital projects not including the Wastewater Treatment Plant (WWTP). The WWTPis driving rate increases but would still need the rate increases even without that project for the debt service Series 2023. Bonds whichi is approximately $19.2M Therei isas $2M transfer that occurred in 2024 with al budgeted $1Mt transfer included ini the Debt issue of approximately $19.2M, in Series 2023 bonds, with annual payments of $840k. Additional debt issue of approximately $4.5M, Series 2024 Bonds, with annual payments starting in 20261 from the Utility Fund. In using the money set aside it lowers the rate increases. Spending $2.5M of the funds whilel leaving money for cost over runs. InFY  service and asked that HDR, Inc. do aj presentation for Council.  with additional debt includedi in the model. 2025 budget to fund the WWTP.  September 17, 2024 Special Council Meeting Minutes  Page 1of6    191  2023 and FY 2024 $23.7M will be spent, leaving $3.9M available in the WWTP Construction Fund (Fund 56) and $27M available to pay for the WWTP. Upgrades to lift stations and water mains are needed. Rate recommendation on the water side is a 15% rate increase which is $7.64 per month for 5,000 gallons of use. Rate recommendations. ont the wastewater sidei isa 25%1 rate: increase which is $11.13 peri month for 5,000 gallons of use. Total for water and wastewater rate increase would be 19.7% The proposed water utility summary shows the decrease due to the money being set aside in 2025-2026 for a new Wastewater Plant. The goal ist tol have the utility funds to become The operating revenues should never go above 50% of the reserves. Ini the residential and commercial bill comparisons, thej proposed billi for 5,000 gallons puts Ingleside higher than Discussion was held between the Council Members, City Manager Lewis, and Grady Reed about other cities updating rates, the difference in cities owning their own water wells versus cities having toj purchase water from other entities, estimating connections growth rate for Ingleside, billing unit on the presentation being for 2025, how the billing is calculated, and] how Ingleside previously went through the samel kind of study several years The water rate increase of 15% includes the proposed pass through rate increase from the San) Patricio Water District. The City of Corpus has infrastructure increases which affects Grady Reed stated he also did the rate study last year for the City of Ingleside. The Wastewater Treatment Plant is the number one driver oft the increase, there is a 20%1 rate increase just to fund the WWTP, with a 25% increase last year and now there needs to be another increase of 25% this year to start the funding which is critical on WWTP with Further discussion was about the 15% increase that has already been factored into the budget previously presentedt to Council, the recommendation is an additional 3% increase. Documentation has been filed to ask for a supplement, while October 30, 2024 will be the opening date for applying. Recommendations are based on historical growth trends, However, in the budget a projected decrease in building permits would contradict using The desalination project in Corpus Christi will increase the rate which possibly is being passed from San Patricio Water District tol Ingleside. The City of Corpus Christi sells water to San Patricio Water District and San Patricio Water District sells tol Ingleside. Cities are now looking for alternate sources of ground water and the water purchases are half of our Paull Baen, 2177 Glenwood) Dr, addressed the Council about the cost of allocations between the water system and the wastewater system that was presented to thel HDR representative, reference to $3.4M in reserve and was based on last year's budget, obligation to the city whichi is for a Wastewater Treatment Plant whichi is being based on a1 tax rate. Grady Reed responded about how the City could possibly move more money into the reserve fund, but the fund is there toj pay fort the debt for aj period ofyears; $300k assuming isj just the utility portion for the Series 2024; through general fund, debt being tax supported; first payment through taxi revenues assumed, could be through the general fund Debra Sanders, 3076A Ave A., addressed the Council about the watert the citizens are getting, citizens getting sick; water reports coming back as failing, and the city had toj pay fines;  increase whichi is $18.77 per month.  stable.  neighboring cities but comparable.  ago without increases and it failed.  San Patricio Water District whichi is being passed to the citizens.  uncertainty on the debt the city has.  historical growth trends.  total water budget.  with the 2025 debt tol be paid.  andi ist the city addressing the water testing, better water quality.  September 17,2024 Special Council Meeting Minutes  Page 2 of6    192  Consent Agenda Public) Hearing  No Consent Agenda presented for this meeting.  7. Public Hearing on the FY2025 City Manager's proposed budget.  At 7:32 p.m. Mayor Pro-Tem Long convened the Ingleside City Council into a Public  Hearing.  Speaking For: Speaking Against: None  None  Paul Baen, 2177 Glenwood, addressed the Council about the material presented to the Councila a fullr month to go over thel budget? Wanted tol know about thei industrial sales taxes for special projects, unfunded pension liability, how certificate of obligations being met, At 7:36 p.m. Mayor Pro-Tem reconvened the Ingleside City Council into a Regular  status oft the process, hostile predatory environment.  Meeting.  8. Public hearing on the 2024 proposed tax rate.  At 7:36 p.m. Mayor Pro-Tem Long convened the Ingleside City Council into a Public  Hearing.  Speaking For: Speaking Against: None  None  Paul Baen, 2177 Glenwood Dr., addressed the Council about the Council considering the adoption ofay policy which prohibits the use ofany unused incremental tax rate or foregone revenue amounts as recently provided for by the legislation; not adopting tax rate, long At7:38 p.m. Mayor Pro-Tem Long reconvened the Ingleside City Council into a Regular 9. Public Hearing on Ingleside Development Corporation fiscal year 2024-2025 budget. At 7:38 p.m. Mayor Pro-Tem Long convened the Ingleside City Council into a Public  range plans, andt the status of plans not implemented.  Meeting.  Hearing.  Speaking For: Speaking Against: None  None  Paul Baen, 2177 Glenwood Dr., Board of Directors for the Ingleside Development Corporation (IDC), IDC has been made aware ofa need for legal advice and will take the necessary actions to get the services of an attorney for the interest of the IDC; revision of the proposed budget is expected to presented; requests of the Council in writing for the current plans for the Economic Development department, sO the IDC can take the appropriate considerations of the impact on the City Manager's proposals and regulations, Council Member Diehl askedi ift the budget document was the same one that was presented before. City Manager Lewis informed the Council that it was the same budget document  and take the: necessary actions. that was presented before.  September 17, 2024 Special Council Meeting Minutes  Page 3 of6    193  At7:41 p.m. Mayor Pro-Tem Long reconvened the Ingleside City Council into a Regular  Meeting. Regular Agenda  10. Deliberate and take appropriate action on the 2024 Update of Water and Sewer Rate Paul Baen, 2177 Glennwood Dr., reiterated his prior comments made under the public hearing, andi madet the additional comment: about the 5%1 rate increase, done years ago, still Discussion was held between Council Members, City Manager Lewis, Director of] Finance Vela, and) HDR Presenter Grady Reed about the $3.4M, the $75k to $80k coming from a Resolution change last year setting al base pay, the reasons for the calculations from the past. Water system certified through the State of Texas have tested the water which is Further discussion about the start of the budget process beginning in August while staff started budget in March; reducing some operations would be needed if not passed; maintenance oft the water towers with debti needing tol bej paid off, money tor repair the water tower after Harvey was spent on other things; going through the process to go through TCEQ to use it again because the water tower has been there since the 1960's and the WWTP was next toi it; TCEQ notices received in 2023; the total including Corpus Christi is1 15%1 total, 15% on water and 25% on WW, the purpose oft the 3% increase is based on approximately $80,000 stated ini the memo; and the 3%i is included in the 15%. Cindy Wilson, 2635 San Angelo Ave, addressed the City Council about how water will Further discussion was held about the minimum of water usage of3,000 gallons; average user will have a bill go up about $19.70 per month; other cities not posting what their increases willl be; possible better breakdown on water and wastewater bills, so Council can have this information on additional projects before passing the budget; and proposed projects being paid by 2026. Budget tax rate must be adopted by September 24th. Need some plant tos start generating revenue toj pay for the $840k debt, and recommendation: is to start now. The rate increase is about other projects, not just the WWTP. Each lift station is about $4.5M, ifp projects don'thappen then the rates need tol be adjusted accordingly. Motion: Council Member Diehl made a motion to direct staff as part of the impending resolution to cover the required increases withi regards to wastewater treatment and readjust the Capital Improvement Projects (CIP), basically bare bones, and make one package. Mayor Pro-Tem) Long seconded the motion. Motion carried with allj present voting ini favor. 11. Deliberate and take appropriate action on the City Manager's proposed Fiscal Year Discussion was held between Council Members, City Manager Lewis, and Director of Finance Vela about the projected number of employees from 1541 to 156, ini regards to the Economic Development Department having two (2) employees; projections were already calculated into the budget in regards to the previous change of the water and wastewater rates; taxi rate of 0.642061, which is the projected collections of$1M less over last years. City Manager Lewis informed the Council that the franchise fees are used for the City's Right of Ways (ROWs), the City does not charge that to ourselves or the water fund or sewer fund, for the use of thel ROWS, but we do make ani internal transfer for costs that are associated with the actual operations of the General Fund; if no changes are made for the no new: revenuei rate: andi reducing by $1M and! having to go back to the voter approval rate, having the money ini reserves to offset the cost; reducing the rate or keeping ita at whati itis now, the City isi not generating the no new revenue rate, because iti is an additional cost to the citizens; taxi funds and enterprise funds, andt the enterprise funds are the water ands sewer funds; andi funds projected in reserves are not able to mix within those accounts.  increases for the City of Ingleside.  being set aside?  certified by the State, and each year they will come back for more.  now cost approximately closer to $150.00 per citizen.  2024-2025 Budget.  September 17,2024 Special Council Meeting Minutes  Page 4 of6    194  Further discussion was held about the need to adjust rates toj pay off debt instead of going out for bonds; rate at which budget is calculated is not a no new revenue rate; used unobligated balance to offset M&O; voter approval rate was a little over 0.74 cents; and  explained how the adoption of the rate is done.  No Action Required  12. Deliberate and take appropriate action on the proposed 2024 Property Tax Rate. Discussion was held between Council Members and City Manager Lewis about the staff recommendation to take official action on the September 24, 2024 Regular City Council Motion: Council Member! Diehli madea a motion to] postpone official action ont the proposed 2024 property tax rate until the September 24, 2024 Regular City Council meeting. Council Member. John Salinas seconded the motion. Motion carried with all present voting in favor. 13. Deliberate and take appropriate action on a proposed Cove Park utility easement to Discussion was held between Council Members and City Manager Lewis about AEP not being granted a utility easement by the property owners, and that City staff met with AEP staff on site and determined a variable width utility easement would be necessary. Motion: Council Member Julio Salinas made a motion to authorize the City Manager to execute the easement after legal review. Council Member Pruitt seconded the motion.  meeting on the proposed 2024 property tax rate.  be granted to AEP.  Motion carried with allj present voting in favor.  Executive Session 14. Closed Session  City Council will meeti in Closed Session pursuant to thej provisions of Chapter 551 of the Texas Government Code, in accordance with the authority contained in: A. Section 551.071 Consultation with Attorney - City Manager Employment At 9:02 p.m. Mayor Adame convened the Ingleside City Council into a closed session pursuant to provision of Chapter 551 of the Texas Government Code, in accordance with the authority contained in Section 551.071 Consultation with Attorney City  Contract.  Manager Employment Contract.  15.Open Session  City Council will reconvene in Open Session at which time action on the matter(s) A. Section 551.071 Consultation with Attorney City Manager Employment At 9:16p.m. Mayor Adame reconvened the Ingleside City Council into a open session pursuant toj provision of Chapter 551 oft the Texas Government Code to take any action necessary related to the executive session noted herein, or regular agenda items, noted  discussed in Closed Session may be considered.  Contract.  above, and/or related items. Item A: No action taken.  ClosingAgenda  16. Items to consider for placement on future agendas. September 17,2024 Special Council Meeting Minutes  Page 5of6    195  Council Member Diehl requested for new employees tol be introduced to the Council. Council Member Julio Salinas requested for a workshop to list new/future projects to give staff information on how to plan. Future use map to help with Planning and Zoning recommendations. Comprehensive Plan will go through all the requirements as a future agenda item. The current future use map gone through the process every 5years.  17.4 Adjourn.  Mayor Pro Tem Long adjourned the special meeting of the City of Ingleside at 9:22 p.m.  APPROVED:  Pedro Oscar Adame, Mayor 26  ATTEST: Ruby)  itySecretary  Ak  September 17, 2024 Special Council Meeting Minutes  Page 6of6