By Anton Riecher and Kathleen Calame
Citizens took the opportunity at a public hearing on March 28 to expressed frustrations, concerns and questioned the Devine City Council and Mayor about the upcoming $15 Million dollar drainage bond that the voters are being asked to pass on May 6, 2023 with a substantial tax increase.
Topics addressed by the public ranged from the possible negative impact such a tax rate hike is expected to have on citizens and businesses, driving away new business, how the overall project benefits a relatively small number of homes , to the long term limitations imposed by the state on municipal tax rates. Concerns were expressed over the priority and slow progress to finish the asbestos water line project already underway to insure clean and safe drinking water to the whole community, plus the lack of funds available if the bond passes to take care of such projects if needed.
Time rules challenged
With the deciding tie vote called by Mayor Cory Thompson, the Devine City Council rejected a motion to extend the time available to give citizens commenting from five to 20 minutes during a public hearing on a proposed $15 million flood improvement bond issue. Each citizen was cut off after 5 minutes.
“If council wants to change the rules then we need to actually go in and change the rules,” Thompson said following the split vote March 28.
The $15.020 million bond issue involves drainage and flood control improvements to better channelize water entering Burnt Boot Creek. Principally, the project would mitigate flooding issues between Colonial Parkway to Howell Street affecting 32 homes and structures within the 100-year flood plain.
For complete video coverage of the public hearing visit the Devine News’ YouTube channel at youtube/3elazU9_fR8.
At the second of two public meetings on the bond issue proposed for the May 6 election ballot, Thompson opened by addressing the recent controversy over time allowed for public comment.
“I’ve talked to legal counsel (City Attorney Thomas Cate) for the past couple of weeks,” Thompson said. “He has recommended that I follow standard city policy instead of something slightly different when conducting a meeting.”
In the past, Thompson said he had always allowed three minutes for public comment. However, a review of the actual city code written in 2007 places a five minute limit on such comment.
“And that’s what we’re going to do tonight,” Thompson said.
Council previously permitted three-minutes uninterrupted for each individual to address the council. By contrast, the five minutes would include breaks for response from council members and the city staff, With regard to items on the regular session agenda, individuals are permitted to make questions now as each topic is discussed.
Following the first speaker Frances Navarro who was cut off at the five minute mark, District 4 Council Member Josh Ritchey asked if the council could extend the time limit further. Cate told Ritchey that the council was free to vote on the matter.
“I make a motion that we extend the amount of time that citizens have to speak at this public hearing to 20 minutes or until we run out of time tonight,” Ritchey said. The motion was seconded by District 2 Council Member Angela Pichardo.
However, District 3 Council Member David Espinosa and District 5 Council Member Debbie Randall voted against the motion. With District 1 Council Member Ruffino Vega absent, the deciding tie vote went to Thompson.
Thompson said, “Motion fails”.
Tax Bills would rise drastically
Michelle Berdeaux, Chief Appraiser of the Atascosa County Appraisal District is a Devine resident who lives on Jack Nicklaus. She asked for clarification on a comment at a previous meeting by the representative of SAMCO Capital Markets, the city’s financial consultants, that the project would cap the municipal tax rate at $1 per $100 valuation.
“I believe the public is being misled. According to the Texas Municipal League municipal property tax rates for cities of 5,000 population and less are limited by the Texas Constitution, Article 6, Section 4 and 5, to a maximum tax rate of $1.50 per $100 of assessed valuation. As of 2022, Devine’s population stands at 4,349, Berdeaux said.
“So my concern is that if you’re maxing out your tax rate at $1 I believe, if I’m not mistaken, that’s your interest and sinking fund,” she said. “But the whole combined city tax rate can be up to $1.50. If we’re combining all of our resources into this project … I think I read somewhere it’s going to help 25 homes I believe and a couple of streets, okay, for the next 20 years what are we going to do about our services.
“We’re going to have to go up on our tax rate to pay our police officers, city employees, public works personnel,” Berdeaux said.
For example, she said that the 20-year estimated cost for Mayor Thompson on his new home built in 2022 and not at market value because it was under construction, at a tax rate of $1.50 per $100 valuation, would be $44,213, she said.
“Your tax bill, if it were at its regular amount would go from a current tax of $549.54 annually to $2009.70,” Berdeaux said. She also reported that the annual tax rate on Randall’s home would potentially rise from $671 annually to $2,254.73.
“That’s almost a $50,000 investment out of your pocket for these 25 homes.” Berdeaux said.
Berdeaux’s own tax bill would rise $94,000 over that same period, she said.
“I don’t think this has been brought and discussed with the public enough for us to put it on the ballot. I don’t believe it has been put out to the public effectively so everybody understands what this is actually going to do to their pocket book”, she said.
“In this economy, with the property values increasing annually you’re going to do this to your home owners,” she said. “You’re going to kill your businesses. Nobody is going to pay a tax rate like that to come here. They’re going to go to Lytle. They’re going to go to any other city but Devine, Texas, at a $1.50.”
The only way to offset rising property taxes is to increase sales tax revenue, Berdeaux said. “You are not going to get a business in here at $1.50. Poteet almost died at $1.10,” she said. “They’re still at $1.02. Over 10 years they’ve been over a $1. So explain to the public what you’re doing to them. Because it isn’t just one tax rate. What’s going to happen with the school and the county and everybody else.”
“You can shake your head no, but that’s a dollar amount for every citizen in this city and you are going to cause an increase in your delinquency rate, cause an increase in foreclosures. People are going to move and you aren’t going to be able to pay for this because there won’t be a tax base. You are going to kill it, dead in the water,” she said.
“Put that out to your property owners before they come out to vote”, said Berdeaux.
Asked by Thompson to address the $1 cap concern, Mark McLiney of SAMCO Capital Markets said that “some of the facts (Berdeaux) discussed were accurate.” The maximum tax rate for a city the size of Devine is $1.50 per $100 valuation.
“Now there are lots of different ways to get there,” McLiney said. “On debt, the max that the attorney general will allow on debt is $1”
If the city council authorizes the bond issue the total debt rate for the city’s existing bonds and the proposed new ones would be roughly $.44 cents per $100 valuation, depending on taxable values and interest rates.
The city’s current M&O rate is 39.64 cents and the service debt rating is .091 cents, for a total tax rate of 83 cents per $100 valuation, McLiney said.
“I’m not sure where the $1.50 comes from except it is the cap,” he said.
At the request of Devine resident Barry Graham, McLiney gave a rundown on how much bond debt is supported by the city’s ad valorem taxes and utility rates. The principal outstanding for the general fund supported by ad valorem taxes is $1.150 million and, from the utility fund, $9.690 million.
“That’s how much if you had to pay it off right now that you would have to pay,” McLiney said. “That does not include interest.”
Overgrowth of creek downhill a problem
Graham joined with other speakers to express concern about the engineering going to the flood improvement project.
“Since we’re going to get all this water rolling downhill what’s going to happen when it gets to the bottom,” he said. “You know, it’s got to go somewhere. So if we speed it up at the top of the hill it’s really going to be coming downhill. And Burnt Boot Creek right now is full of trees that are 20 feet tall.”
“Technically, phase 1 of this project was completed in the 1970s,,” he said. “Things have changed a lot since then.”
Graham asked whether the clearance work is included in the proposed bond issue.
“That would be another several million dollars maybe,” Graham said. “After we create our own problem again.”
Pichardo said she has heard the same concerns from constituents in her district.
“I, as a representative for District 2, cannot guarantee that their houses and homes will not flood because the construction will end at Howell Street,” she said.
The creek after Howell Street is full of brush and trees, yet is not included in the drainage bond reconstruction Pichardo which concerns her.
Who wanted this on the ballot? Can we afford?
Phil Montgomery took the podium to ask who on the council had “championed” the idea of putting the drainage improvement bond issue on the May ballot. Thompson replied that beginning late last year the council began reviewing issues outstanding that the public had asked about.
“They were items that were beyond our scope as being able just to do anything,” Thompson said. “The council sitting here should not indebt the city for $15 million. Through a bond election the public themselves are actually able to vote for the item if they want.”
Montgomery also told the council he was concerned about how the city keeps track of pending projects and proposals.
“I’m not saying we don’t need to do this but can we afford it?” Montgomery said. “Can we take that on as a city and actually grow and prosper because business isn’t going to come here. And people aren’t going to move here when they see the tax rate.”
He also said that history “is going to pay out and it’s going to point that lonely finger at you.”
“I want to know who put this on the agenda,” Montgomery said. “I know that council approved it or what you call it. Who actually championed this? Who actually did the research? Who, for the lack of a better term, kicked the pig?”
Asked by Ritchey what happens when you kick a pig Montgomery replied “it squeals.”
Was sufficient time to research before putting on ballot
Devine resident Nancy Saathoff asked, “Was every council member given a comprehensive list of items, and given enough time to research them individually, prior to voting on what items to choose from for this bond? Were they given sufficient time to research the various projects under consideration and choose from that list?
Ms. Pichardo replied no. Ritchey replied no, and Espinosa shook his head, but she asked him directly and he said no. Only Randall replied that she believed she had been given enough time.
“I had stayed on top of a lot of this stuff myself,” Randall said. “We’re we given every teenie-weenie detail – no.”
Saathoff asked, “Is there currently any land or property in this plan area that is currently unable to be developed, that will be able to be developed upon completion of this drainage project?”
“What about the 40 acres near Colonial Parkway and Libold near the golf course?” asked Pichardo.
“No” replied the Mayor Thompson.
$500,000 grant applications
In other action, the council approved two applications for a $500,000 Texas community development block grant, one to cover a water improvement project and the other for a sewer improvement project. Only one of the two grants would be granted, if either.
The sewer improvement project is a backup in case the water improvement project for a new city well is denied, Thompson said.
Council members also voted to approve action authorizing Thompson or Interim City Administrator Dora Rodriguez to sign applications for future grants though the Texas Department of Agriculture TDA Go grant program.
Yancey Water Supply easement at Airport
The council voted to approve the city staff working on a 10-foot-wide, 17,000-feet long easement for Yancey Water Supply across the north side of the Devine Municipal Airport, in return for providing water service to the airport.
Cancelling the Bond Election? Devine call special meeting to discuss
The City of Devine in a unusual move called a special live stream meeting on press night, Tuesday, April 4 to discuss and consider cancelling the Bond Election they themselves set for May 6, 2023.
The $15 Million Dollar bond that Mayor Cory Thompson and the City Council ordered was for drainage and flood issues but brought up lots of controversy on the haste, tax increase, timing and lack of public input prior to putting it on the ballot at the two public hearings.
See story next week for results of this special press night meeting.