BM 1999-03-23 EcDevECONOMIC DEVELOPMENT WORKSHOP WITH SCHOOL BOARD
Tuesday, March 23,1999
Synopsis of Meeting
Attendees:
Entire school Board, Buddy, Homer, Ralph, and a couple of additional staff.
Bill Harries, Bill Rohloff, Chad Beach, Pat Murphy, Mary Ann Kellum, Gary Roden,
Gordon Foster, Ralph Hines and wife, Tom Morton, Bennitt Ratliff, Don Melton,
Andrew McCaig, Adam Wells, Mark Myers, Gary Sieb, Ken Schulman, Jeff Turner,
Lynn Moak, Leon Johnson, and 4 others
At 7:02 Buddy asked Lynn Moak to begin the session by reporting on the Legislative
bills that might affect the School District. Lynn gave a general overview.
At 7:18 Buddy gave Lynn a nice introduction and Lynn explained the Triple Freeport
concept to the School Board. He used 22 slides to make his presentation and distributed
a hand out that outlined his major points. At conclusion of his report (approximately
8:20), he entertained questions from the Board. Deana Reeves had a concern regarding
Table 1, and needed clarification of a point made on page 11. She also wanted to know
who determined inventory values and wanted some additional information relative to
sales tax generation. Robert Key asked some searching questions regarding Table 6, and
offered an opinion on what it would take to garner School Board support for this concept.
He also pointed out that zoning sometimes changes and that a negative effect could occur
if LI zoned land were to be rezoned for residential purposes. He cited the Deer Run
project as an example of what he was talking about. Dr. Arthur asked a question
regarding page 6, and there were some general statements volunteered by other School
Board members. Buddy Echols had some questions regarding page 8, and expressed an
interest in knowing what the ultimate plan of development might be for the industrial area
of Coppell. He was also interested in what percentage of inventory Lynn used in his
study (Lynn answered 43%), and generally had a supportive attitude regarding the
Freeport issue. He pointed out that the School District would not support any proposal
that did not cover all the lost revenue that might accrue to the District. There was some
general discussion regarding Chapter 41 vs. Chapter 42 school districts, that over five
years, the District could loose $2.9 million dollars without someone making up the
shortfall, and that it appeared the first year shortfall would be in the area of $1.4-1.6
million dollars. At approximately 8:50 Lynn had addressed all questions, and the Board
took a 10 -minute break.
At 9:00 Leon Johnson began his report (attached) and generally offered a favorable
response to Lynn's presentation. He did offer some cautions including:
Freeport exemptions are irrevocable, so proceed cautiously
We are talking about revenue for future generations
Coppell will probably continue to be a "rich" district
Make sure you understand outstanding debt
Lynn's projections were conservative—that's good
MAJOR POINT: first year short fall
MAJOR POINT: debt service needs to be addressed
Hold harmless definition (no loss of revenue) must be included
Shift of tax obligation from one group to another not good
Any contractual arrangement must be legally accountable
Net out additional revenue value
A lot of school bills have been introduced in the Leg. --this bothers Leon
Debt service and salaries are all going up, the Board must recognize that
School Board promised citizens that $1.60 was top
Contractual agreements can work, if properly drafted
If nobody picks up shortfall, a certain 5 cent additional tax rate
Bottom Line:
Put into the agreement whatever the School Board wants!
If we have actual growth in excess of $300 M per year, $1.60 rate will easily hold
The District should consider granting this:
First year shortfall is paid out (maybe a number of contracts)?
Interest and sinking fund loss needs to be made up
Compute net value loss
If the $120 M obligation is met --then let's just go on down the road
There needs to be a built-in system of certain obligation—no reneging
A shift of the financial obligation from one group to another no good
Need to answer the question: how much land is available for development?
At conclusion of Leon's presentation there were not many questions. Buddy summarized
the discussion with the following points:
Who are participants to the contract? (need to be people Bd. is comfortable with)
First year shortfall made up
More difficult to determine the rest of the equation (interest and sinking fund)
How much development will this (if granted) generate?
How long will it take to make up total shortfall?
It will take $120M to be made "whole"
An example: 5 buildings/yr. @ $4M each times 30 buildings = $120M
A contract blessed by the School District attorney must be presented before the
Board will vote on this issue
Maybe a third party grantor needs to be specified (the Eco. Dev. Partnership)?
At conclusion of the discussion, the Board agreed to put this item on the agenda for the
March 29 hearing. It was reiterated that several questions need to be addressed prior to
the Board actually taking a vote on this subject, including those outlined above. The
Board will not vote on this issue on March 29. It appears that the Board wants to see a
contract that is "bullet proof', one that addresses the total shortfall question, they have
interest in how the City might develop out, and apparently need more time to mull over
this important decision.
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