As City runs short on cash, Council learns $45,713 in permit fees were waived 
(Posted: 11 p.m. June 30, 2010)
"I don't know who is at fault here, and I don't know what action we can take at this time. But, I don't think we should just let it slide. If we don't follow our own ordinances, we can get sued. I'm very concerned about the way this thing was handled. What kind of precedent does this set?"
Councilman Jack Harkrider
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8 Tax increase, budget cuts likely as Council attempts to address shortfall, June 28, 2010
| As city government runs short on cash and elected officials discuss raising taxes to make up the difference, one business got a $42,000 break this year from the City of Liberty Hill.
Although the City's Building Inspector and the Mayor Pro Tem disagree on how it happened and who is to blame, the City appears to have waived $45,713.20 in building permit fees for a company building an apartment complex for low-income residents, as well as the Williamson County Emergency Services District #4.
Building Inspector Pete McKinney told the Liberty Hill City Council during its regular meeting June 28 that he was directed in December 2009 by Mayor Pro Tem Charles Canady to waive $42,257.20 in permitting fees for the San Gabriel's Crossing apartment complex. McKinney said project developers failed to comply with City ordinance when they submitted a set of plans for approval months after the deadline that were different from those approved in 2008. Because more than 180 days had lapsed between submissions, the ordinance states the company should have been required to pay the entire fee again.
Councilman Jack Harkrider brought the matter to the Council's attention this week after McKinney submitted a report that listed the revenue he had generated for the City from permitting fees and fines compared to his salary and benefits this fiscal year. In that report, which was requested by Canady in May, McKinney states that Canady told him to waive the fee for San Gabriel's Crossing as well as $3,456 that was owed to the City by the Williamson County Emergency Services District #4.
The permitting fees first came to the public's attention during the Council's budget workshop June 25, when Canady suggested that the position of Building Inspector be eliminated in 2010-2011 because the City was paying more for McKinney than he was generating in fees. He said the job should be reduced to an "on-call" position, and added that the City was having to dip into cash reserves to pay employees and make a quarterly payment on police vehicles in the final three months of the fiscal year. ( See the Story)
According to budget planning documents prepared for the Council by a local certified public accountant who said she was providing the service free of charge, permit fees received in the current fiscal year total $29,500 compared to $100,500 that was projected in the 2009 budget. The amount allocated for the Building Inspector position was $53,200, which includes McKinney's salary, continuing education, and retirement contribution, as well as the expenses required of the job itself.
McKinney told Radio Free Liberty Hill Tuesday that he disagrees with the budget figures recorded on the planning document and said the fee revenue total was outdated.
"That was written in anger," Canady said Monday about McKinney's report blaming Canady for the waived fees. Canady did not answer a question from Mayor Michele "Mike" Murphy regarding his motivation in asking McKinney to prepare the report.
Instead, Canady told the Council about another case where the City charged a residential developer in the City's extra-territorial jurisdiction (ETJ) a minimal amount for renewing a plat rather than reviewing the plans. He said he thought the City should be consistent. He then looked to City Planner Mel Yantis to explain that the City has some discretion when it comes to assessing fees.
"If you look at the Council's actions, it's always been erring on the side of not trying to build in forced charges and double charges," Yantis said, confirming that the City does have discretion.
Yantis then went further and offered explanations that moved the discussion away from Canady's involvement. Yantis placed some of the blame for the San Gabriel's Crossing situation on the "organizational structure" of City staff and referenced two former employees who he said contributed to permit processing delays on the City's part.
Yantis added, however, that he believed the developer "should have come to the Council before the 180-day deadline and asked for an extension."
Harkrider, who prefaced his concerns by saying he was "not against the San Gabriel project," said he wasn't sure who was to blame on the City's side for waiving fees, but believed the entire City Council should have the final word on such issues.
"I don't know who is at fault here, and I don't know what action we can take at this time. But, I don't think we should just let it slide," Harkrider said. "If we don't follow our own ordinances, we can get sued. I'm very concerned about the way this thing was handled. What kind of precedent does this set?
"As I remember, most people were vehemently opposed to that project," he added. "It bothers me that proper procedures were not followed and it looks like we (the City) will pay for that."
After the project's general contractor attempted to explain some delays, Harkrider said he thought they had plenty of time to follow the published procedures.
Steve Nash of Nash Builders Ltd. of Horseshoe Bay said his company started surveying the site in April and is now doing dirt work there. He said his building plan had not changed, but the site plan was changed to make adjustments for a water line.
"This was not a request to have the plans reviewed again," Nash said.
After a lengthy discussion, in which little was said about the waiver authorized for the fire department extension, Harkrider made a motion to postpone action on the San Gabriel's Crossing fees until the next Council meeting. His motion was approved.
In other business Monday, the Council voted 4-1 to install video cameras with audio at City Hall and Municipal Court. With McLeod voting no, the Council approved the expenditure of $925 to HK Computers for equipment and installation. The Liberty Hill Police Department is already under video surveillance.
Councilman Glen Gavin said the cameras are needed for security purposes at those facilities. City Attorney Art Rodriguez said on days when Court is in session, there is an added security risk for city employees.
"People here for court don't want to be here," he said. On some days, the courtroom, which also serves as the City Council Chamber, is standing-room only.
"People stand right in front of us (at the information window), and some are irate," said Court Administrator Lolly Chevara. "For our safety, we prefer them (cameras)."
Also Monday, the Council discussed the creation of a City Maintenance Department, but took no action on the item. Mayor Murphy, who raised the issue, said she thought the City might be able to save money if more work was done in-house rather than contracting out to vendors. McLeod suggested staff research the amount of money spent with vendors for mowing, repairs and general maintenance and discuss the item in a future budget workshop.
The Council heard a report from Grant Development Services that the City had been approved for a $250,000 grant for a water well for the Liberty Hill Water Supply Corp. A report was also given by Steger & Bizzell, the City's contractor for engineering services, listing the status of current engineering projects.
In other business, the Council voted unanimously to:
* Hire Lucas Wilson as Municipal Court Judge.
* Approve a $1 per hour pay increase for City Secretary Tammy Kirk.
* Approve a revised travel policy for city employees that reportedly complies with IRS codes. The new policy includes provisions previously agreed to by the Council such as reimbursement for gratuities, and reimbursements only for expenses where receipts are submitted. Employees may not be reimbursed for meals unless they are 50 miles from Liberty Hill.
* Approve an ordinance adding a fee for connecting duplexes to the wastewater system. The ordinance set the hookup fee at $9,000, which includes one grinder pump and connections for both units.
* Approve Right of Entry agreements with Pedernales Electric Coop. and 183 BLW, LP. The agreements allow the City's engineering contractor to gain access to large acreage tracts for the purpose of doing surveys.
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