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HomeMy WebLinkAbout10-29-01 PC MinutesMINUTES JOINT PUBLIC HEARING PLANNING COMMISSION CITY COUNCIL October 29, 2001 City Council Chambers A Joint Public Hearing of the Planning Commission and City Council was held on October 29, 2001 with the following members present: Commission members present: Chairman Laurie Leister Vice -Chairman Greg Dykeman Commissioner Bill Lucas Commissioner Dohn LaBiche Commissioner Glenn Bodwin Commissioner Carlos Hernandez Commissioner Dale Hallmark Commission members absent: Commissioner Marty Craig Commissioner Albert Robinson Councilmembers present: Mayor David W. Moore Mayor Pro -Tern Guy Goodson Councilman -at -Large Andrew Cokinos Councilmember Lulu Smith Councilman Audwin Samuel Councilmember Bobbie Patterson Councilmembers absent: Councilmember-at-Large Becky Ames Also present: Stephen Richardson, Planning Manager; Murray Duren, Senior Planner; Tyrone Cooper, First Assistant City Attorney; Bart Baker, Senior Planner; Jill Cole, Recording Secretary; Kyle Hayes, Economic Development Director and Stephen Bonczek, City Manager APPROVAL OF MINUTES Vice Chairman Dykeman made a motion to approve the minutes of the public hearing held October 22,2001. Commissioner Lucas seconded the motion. Motion to approve carried 6:0. Planning Commission October29,2001 Ui I iNrmlwnalzw Mayor Moore called the Joint Public Hearing of October 29, 2001 to order and explained the purpose of the joint hearing process and then turned the meeting over to Chairman Leister. She explained the policies and procedures for the hearing process. 1) File 617-OB: Consider the request for annexation of three areas south, southeast and east of the City of Beaumont totaling 4,239.68 acres, more or less. Applicant: City of Beaumont Mr. Richardson stated that the meeting was the second of two public hearings required by state law for annexation. Area I is located south of the southeast corporate limits, south of Cardinal Drive, Sulphur Drive and Spindletop Avenue, extending east and west of Port Arthur Road and extending west of Erie. Area 2 is located along the west bank of the Neches River, extending in a northerly direction from the corporate limits at the K.C.S. Railroad right-of-way to a point east of Washington Boulevard if it was extended cast to the Neches. Area 3 is located is between the Neches River and Highway 347 being primarily the Beaumont Works of DuPont and a number of other tracts within that complex. (Commissioner LaBiche arrived.) The City of Beaumont is annexing these areas for the following reasons: 1) Doing so will add to the economic stability of the City by ensuring that it has an adequate tax base to provide the necessary services to its residents. 2) It is the City's desire to regulate the extent and quality of development within the areas proposed for annexation. This will enable the City of Beaumont to plan and control the areas' development so that it will enhance and not detract from the City. 3) To protect environmentally sensitive areas and to better regulate the quality of development in the area. Mr. Richardson recommended approval of the annexation of the three areas. Kyle Hayes, Economic Development Director, addressed the Commission. He stated that the City currently has 14 in -lieu agreements or industrial agreements where they make payments to the City. For the year 2001, those 14 companies paid N Planning Commission October 29, 2001 the City of Beaumont $11.2 million dollars, 17% of the general fund revenue. That money goes to provide police and fire protection, library services, etc. and is extremely important to the City. In the last 10 years DuPont has sold off or split into 3 other companies... DuPont Dow, Ineos, and Beaumont Methanol. Last year, those four companies paid the City 1.7 million dollars. The City has a good relationship with these four companies. In the past, the City could do what is called strip annexing. If the City was not able to reach an agreement with one of those four companies, the City could go down Highway 347 and take in that particular company. The law changed about 3 years ago where a city now has to go in and take a minimum of 1,000 feet. So if the City can't reach an agreement with one of those companies, we have to go in and annex the entire facility or cut through the middle of the facility. That's why the City is proposing to annex the DuPont facility, so it won't be cut down the middle. Mr. Hayes added that he is optimistic that an agreement will be reached with all four companies. Mr. Hayes said that the City has met individually with representatives from 3 of the companies and has a meeting scheduled with another. Through this process, the City came across 5 companies located on the Spindletop oil site - Duke Energy, Santana, Sabine Gas Transportation, Texas Brine Corp., and Phillips Services. Those 5 companies have a value of over $75 million dollars. If they were located inside the city limits of Beaumont, they would contribute or make payments of over $475,000. In the last week, two attorneys representing three of those companies have been visiting with the City Attorney and himself. They are going to work with those companies to reach an agreement. But we're going to need an agreement with at least 3 of those companies to make it worthwhile. Otherwise, it's better for the City of Beaumont to move forward and annex those 5 companies. The 14 in -lieu agreements expire in December. Neches Industrial Park is located at the end of Gulf States Road. Gulf States Road is located behind Exxon Mobil. There's 6 or 7 companies located on Gulf States Road —Exxon Mobil, P.D. Glycol, Entergy—the City has agreements with all of those companies. Neches Industrial Park does not want to be annexed by the City of Beaumont, but they don't want to enter into an in -lieu agreement either. At the last hearing, the comment was made that the City doesn't want to extend water and sewer out to the Neches Industrial Park. The City doesn't extend water and sewer to anyone outside the City limits of Beaumont unless they're willing to reimburse the cost of doing so. It's not fair for the taxpayers of Beaumont to make improvements for someone who doesn't pay any city taxes. Another comment was made that they don't derive any benefits from the City. Mr. Hayes said that he, Mayor Moore, officials from the Chamber of Commerce and representatives from Entergy's Economic Development Department have been out to that site at least three times in the last 2 years bringing prospects to the site. They're located outside Planning Commission October 29, 2001 the city limits, but regional economic development groups trying to bring jobs to this community site would be considered a benefit derived from the City. Mr. Hayes encouraged the Commission to move forward with annexing these properties. Vice -Chairman Dykeman asked Mr. Hayes to address concerns that were expressed at the last hearing about the effect annexation would have on regulation of the existing oil producers. Mr. Hayes stated that these 5 companies are spread out from West Port Arthur Road east and it wouldn't make sense for us to take 1,000 ft. here and 2,000 ft. here to take in these companies. They had tried to take in an area that makes sense. It would affect some rice growers and other agricultural uses. As far as the oil drilling —no drilling can be done within 1500 ft. of any residential structure, but there aren't any residences within this proposed area that they are aware of Chairman Leister asked about the fees that were mentioned that would have to be paid to the City in order to drill within city limits. Mr. Hayes said that there are fees, but he doesn't know what they are, but if the City annexes that area, they would not pay any additional taxes until January 2003. If we enter into an agreement with those 5 companies, those areas would continue to be outside the city limits and it would be business as usual. Fencing of the drilling sites and $25,000 in fees that were mentioned at the last hearing were discussed. Mr. Richardson said that the last hearing, the question was raised about the 500 ft. height minimum that planes could fly. There is nothing in the City Code about it, but he called one of the aviation companies in the City and they said that normal FAA regulations are 1,000 ft., however the FAA does grant waivers to 500 feet. Discussion between Vice -Chairman Dykeman and Mr. Hayes regarding the issues raised by Neches Industrial Park and their attorney, Mr. Hoke Peacock. Commissioner Lucas and Mr. Hayes discussed fire response at Mobil. Discussion followed between Commissioner Lucas, Mr. Hayes and Tom Warner regarding City services such as water and sewer and the cost involved in providing them. The time frame of providing these services was also discussed. Mr. Lucas said there should at least be a ballpark figure. Mr. Warner said he would need to know what services they needed. He said we really want the in -lieu agreements. Mr. Lucas said it sounded like blackmail to him. He added that the City should privatize more and put the city bureaucrats to work. Planning Commission Oclober 29, 2001 Chairman Leister opened the public hearing and asked for comments. Jim Ellis, Site Manager for DuPont, Highway 347, addressed the Commission. Mr. Ellis said that DuPont has been at the Area 3 location for 50 years and exceeds $5 billion in facility investments. They employ over 5,000 in Texas and pay over $45 million in taxes. At the Area 3 location, they employ over 800 people and cover over 793 acres. Every 7 years DuPont negotiates the renewal of industrial agreements with the City. These agreements are a fee that each company pays in lieu of taxes and services, although the complex lies outside the city limits, Each company pays a negotiated fee over the 7 year life of the contract. Mr. Ellis stated that the City generates revenue without having to provide any services to the industrial park companies. DuPont is in the process of negotiation with the City and was very surprised and disappointed to receive a letter on the proposed annexation dated September 17 from the City. They were never informed of the City's intent to annex the industrial complex although each of the companies have been independently negotiating with the City on the renewal of the industrial agreements. The letter and the article in the Beaumont Enterprise on September 20 was the first communication that they received. Because of their long standing history of open communications with the City, they were very disappointed in the manner in which the annexation issue has been managed. The industrial contracts the City has today represent approximately 17% of the total revenue for the City's general fund. DuPont and the tenant companies on the site collectively paid fees for the contract to the City last year totaling $1.7 million, which represents about 3% of the City's revenue. Over the life of the current 7 year contract, we've paid $13 million to the City. He said that DuPont also supports local schools, Lamar University and communities in this region. Total local fees and taxes over the 7 year period amount to over $75 million. Fees and taxes were paid during extremely difficult economic times. DuPont produces commodities and is subject to competition. They have had to close several facilities in the last few years and these closures have resulted in the loss of 250 jobs which translates to approximately $3 million in lost county and city tax revenue. DuPont believes that annexation would be fiscally irresponsible and is not in the best interest of the City or citizens. Mr. Ellis answered questions from the Commission. Sandy Elms, 6000 Highland, addressed the Commission. Ms. Elms told the Commission and Council that she recently purchased her property. She is not in favor of the annexation. One of the reasons she purchased property outside the city limits was because it lowered her costs of operating her environmental contracting business. Marcus Petry, attorney for Sabine Gas Transmission, addressed the Commission in opposition to the proposed annexation. He said that they stored natural gas in seven R Manning Commission October 29. 2001 salt dome caverns. He added that the company would like to have an industrial agreement. Jim Kaiser, 7875 Spurlock, addressed the Commission in opposition to the annexation. Mr. Kaiser owns property in Area 1 and leases it to Phillips Services, a small oil operator. Hoke Peacock, attorney, addressed the Commission on behalf of his clients, Duke Energy and Santana. He said he is confident that current negotiations for in lieu agreements with the City will be successful. His client at Neches Industrial Park is still reluctant to be annexed or to enter into an agreement. He stated that the Service Plan that was mailed out does not meet state statutes. The plan is only an inventory of existing services. He added that he wanted an order from the City Attorney that the service plan meets state statutory requirements. Floyd Fortenberry, 6155 Erie, addressed the Commission in opposition to the proposed annexation. He said he has lived on the "hill" since 1969. He said he farms and runs some cows and a few horses. He paid the City $5,000 to tie into the prison water line. Tracy Sahualla, 6150 Erie, addressed the Commission in opposition to the annexation. He asked again why the gun club was excluded from the annexation, Mr. Hayes responded that if the gun club was included in the proposed annexation, they would have to close that business if the annexation was approved since firing of guns inside the City is prohibited. Mr. Sahualla said be guessed he would have to start paying city taxes and stop shooting his guns and raising his cows. Susie Fortenberry, 6155 Erie, addressed the Commission in opposition to the annexation. She feels that the gun club should be annexed if everyone around them is being annexed. She added that the gun club was not a business. Why let them keep shooting but not let her shoot on her own property where she lives? Vice -Chairman Dykeman asked Mr. Richardson about the timing of the annexation procedure. Is there some time? Are we reaching a point of no return? Chairman Leister closed the public hearing. Discussion of annexation process followed. Commissioner Lucas asked Mr. Richardson about who pays what and how much in these agreements? Mr Hayes (for Mr. Richardson) replied that some pay 80% of taxes due and some pay 60%. He said the City was in a financial bind and 0 Planning Commission October 29, 2001 needed the money. Mr. Lucas said he has a problem with this. Small companies could go bankrupt or move out of the City. Chairman Leister asked Mr. Peacock about the Neches Industrial Park. He replied that they have never had an agreement with the City. He added that his client paid $170,000 to the City for a water line on the same day that they received the letter from the City about a proposed annexation. She asked why they have not entered into an in -lieu agreement with the City. He replied that you have not made a credible threat. City Manager Stephen Bonczek addressed the Commission and discussed the $4 million city budget deficit. He said we could raise city property taxes. We are pro business and a 20% discount on taxes is a pretty good deal. We will work with these industries. Vice -Chairman Dykeman made a motion to approve the request for the annexation of Areas 1, 2 and 3 into the City of Beaumont totaling 4,239.68 acres as requested in File 617-011. Commissioner Lucas tried to make an amendment to the motion that the annexation should wait until they get in -lieu contracts. Commissioner LaBiche seconded Vice -Chairman Dykeman's motion. Mayor Moore made comments. He said we need a level playing field for all the citizens. Commissioner Hallmark made comments. He said he was still bothered about leaving out the gun club and was worried about the existing farm tracts and residents out there. Motion to approve carried 5:2 (Lucas, Leister). 1 501 11, a, I THERE BEING NO FURTHER BUSINESS, THE MEETING WAS ADJOURNED AT 4:38 P.M. 0