The Pampa City Commission met on Monday evening for a regularly-scheduled meeting at City Hall.
The commissioners revisited a topic from last summer in regards to capital improvement projects for the city.
“We started the discussion last year during budget discussions,” city manager Shane Stokes said. “We had identified a large number of capital needs for the City and we funded the tax anticipation notes, which were basically short-term loans for those projects in the current budget.”
The remainder of the capital needs were tabled until January at Monday’s meeting.
The first topic was the automated water meter project across the city.
“In 2014, we started the project with the purchase of 6,000 (of roughly 7,800) automated water meters and had them installed, which covered about 3/4 of the meters that we have in town,” Stokes said. “Last night the discussion about the meters centered around $1.5 million to complete the project, which would be the remainder of the residential meters.”
Stokes said the idea is to complete the project so all of the meters inside the city are automated. The meters are communicated with through satellite and eliminates the need for meter readers to go out every cycle. The older meters are also prone to inaccurate readings the longer they are in service.
“More and more water gets through the old meters without actually turning the meters,” Stokes said. “You don’t get an accurate count of usage and the older they get, the worse it gets.”
Stokes said this particular project won’t affect the tax rate and will be funded from the water fund. Water rates will also not be increased because of the project.
“We think we’ve gotten our water rates, through a lot of hard work, to where they should sustain the water fund at this rate,” Stokes said. “It will not necessarily affect the water rate, but it will not affect the tax rate.”
The next project addressed was the streets project, which was addressed in 2018 with a very comprehensive analysis.
“It indicated what we already knew, which was our streets are in bad shape,” Stokes said. “It’s not something that happened overnight, it’s just been years and years of not having the money to maintain the streets the way they needed to be maintained. The study showed we have $30 million of need for our streets in 2018. That hasn’t gotten any better in the past two years.”
The streets were analyzed through PCI (Pavement Condition Index) and put in five categories: good, fair, poor, serious and failed.
“It’s anywhere from zero to 100,” Stokes said. “Zero to 24 is a failed street where on the top is anywhere from 70-100 in that rating. Overall the entire city rated at 44 points, so obviously not good.”
The City has identified the most serious and most important streets based on usage, traffic, complaints, etc.
“We’ve kind of prioritized what we thought were the most important streets,” Stokes said. “It’s critical if you can take a street that’s in good condition and keep it there or take a street in fair condition and get it to good condition. That’s really where money is being spent. You can spend $30 million on the failed streets and only be able to do a couple of streets, because they would require a rebuild of the streets.
“But you can spend money of keeping good streets good by doing seal coats or fog seal, things like that. That’s money well spent, because your spending it maintaining the good streets.”
The request was for $2.3 million to address some of those high priority streets.
The third topic in the capital projects was for a second fire engine at $650,000.
“The tax notes we did funded one of those two engines (during last summer’s discussions),” Stokes said. “The second of our two engines is for $650,000. The situation with our fire engines is they were bought at the same time 16 years ago. The trucks that were purchased were on the bottom of the line in regards to fire engine manufacturers.
“They got the most basic model you can get and we’ve simply not had good luck with those trucks. Chief Greg Lee said in his 40 years in the fire industry he has seen things break on these engines he has never seen break on fire engines.”
The two trucks are at the end of their life, the first was funded in the current budget year and the second one needs replaced.
The City Commission determined they wanted to move forward with working financial consultants to take the next step to issue certificates of obligation, which would result in a resolution in February stating the City’s intent.
“There was a lot of discussion about the tax rate Monday night and the truck and streets that are in the general fund that are tax-supported,” Stokes said. “They would affect the amount of tax raised to pay that debt service. We discussed 15-year notes on this general fund debt that would be in the range of two cents on the tax rate to fund it.”
Stokes pointed out as the City’s overall debt package fluctuates (debt that pays off) the payment scheduled could be structured to have as minimal impact on the tax rate as possible. Stokes also said being they are supported by the general fund, they are supported by taxes (sales tax and property tax).
“Sales tax is trending up again for the first time in a long time, so should that trend hold and our sales tax goes over budget, that could even make those payments without affecting the property tax rate,” Stokes said.
Stokes said it is unknown at this point whether or not come budget discussion if they will be discussing the tax rate, but the commissioners came to the conclusion these projects have to be addressed at some point.
“They’re not going to get any cheaper and it’s a matter of if you want to address them or kick the can down the road like it’s been done in the past,” Stokes said.
Stokes emphasized it’s never easy to talk about debt and tax rates, but they are conversations needed to be had.
“It’s never fun talking about issuing debt and possibly raising tax rates,” Stokes said. “But for a city our size, if you don’t spend money on capital, your city continues to deteriorate and again you can only kick the can down the road for so long before you’re forced to do something. We’re trying to do what we can to keep and maintain what we’ve got.”
The commissioners approved the following items:
• Approving the minutes of the January 13, 2020 Regular Commission Meeting and the January 20, 2020 Special Commission Meeting as presented.
• Adopting on second and final reading Resolution No. R20-001, a Resolution of the City of Pampa approving an Economic Development Agreement and Forgivable Loan in the of $250,000 from the Pampa Economic Development Corporation to Resound Networks, LLC.
• Adopting Resolution No. R20-002, a Resolution by the City of Pampa, Texas denying Southwestern Public Service Company’s request to increase rates in connection with its Statement of Intent submitted on about August 8, 2019. SPS’ 2019 rate case would like an increase in their base rates. Originally they asked for $141 million in their base rate but it dropped to $57 million. The Public Utility Commission of Texas is reviewing the case and municipalities had a deadline to take action and this resolution denies the case which will allow more time for the case to come to a settlement. Stokes said the current base rate increase would be six-and-a-half percent, but he anticipates it would fall under six-and-a-half percent.
• Approving the Interlocal Cooperation Contract for the Failure to Appear (FTA) Program (revised 01/2020) between the Texas Department of Public Safety (TXDPS) and the City of Pampa and authorizing the City Manager to execute said Contract. This changes the amount of the fine for Failure to Appear in municipal court from $30 to $10, as the Texas Comptroller’s Office will no longer receive $20 from the fine.
• Approving the List of Disbursements dated December 2019.
