1 1 2 3 KERR COUNTY COMMISSIONERS' COURT 4 Special Session 5 Thursday, January 10, 2019 6 9:00 a.m. 7 Commissioners' Courtroom 8 Kerr County Courthouse 9 Kerrville, Texas 78028 10 11 12 13 14 15 16 17 18 19 20 21 22 23 PRESENT: ROB KELLY, Kerr County Judge HARLEY BELEW, Commissioner Precinct 1 24 TOM MOSER, Commissioner Precinct 2 JONATHAN LETZ, Commissioner Precinct 3 25 DON HARRIS, Commissioner Precinct 4 2 1 I-N-D-E-X 2 NO. PAGE 3 1.1 Pay Bills. 3 4 1.4 Approve Payroll. 4 5 1.5 Consider and discuss request from the City 4 of Kerrville for a Resolution in support 6 of its legislative efforts to use the Hotel Occupancy Tax for a convention center and 7 hotel in Kerrville. 8 1.6 Consider, discuss and take appropriate 14 action on requests from the County Clerk, 9 the Tax Assessor, and District Clerk to appoint clerks and assistants for their 10 offices pursuant to Local Government Code Chapter 151. 11 *** Adjournment. 16 12 *** Reporter's Certificate. 17 13 * * * * * * 14 15 16 17 18 19 20 21 22 23 24 25 3 1 JUDGE KELLY: Let's come to order. This is 2 Thursday morning, January the 10th at about a minute or 3 so after 9 o'clock, and the Commissioners' Court of Kerr 4 County is now in session. 5 The approval agenda 1.1 is to pay the bills. 6 MRS. JOHNSON: Good morning. 7 JUDGE KELLY: Good morning, Joy. 8 MRS. JOHNSON: The bills for Kerr County is 9 $373,600.69. And other bills to be approved by the 10 Court for the Treasurer's disbursement is Airport, 11 $2,913.38, and Juvenile Probation $315.00. 12 COMMISSIONER LETZ: I make a motion that we 13 approve all bills and disbursements as presented. 14 COMMISSIONER MOSER: Second. 15 JUDGE KELLY: Okay. Commissioner Letz has 16 moved and Commissioner Moser has seconded. Is there any 17 further discussion? 18 COMMISSIONER MOSER: Yeah. I think it's 19 just important every now and then to point out the 20 reason that we have these other things. We have Kerr 21 County, we have Airport. This is not unique the County 22 paying for it. The County is the Administrator for the 23 Airport, so that's the reason for that disbursement 24 there. It's part of the airport budget, bottom line, 25 okay. 4 1 JUDGE KELLY: But it is important to develop 2 the notion that the airport board somehow is not self 3 sporting, because they are. 4 COMMISSIONER MOSER: Correct. Correct. 5 JUDGE KELLY: Any other discussion? Those 6 in favor raise your right hand. Those opposed? It 7 passes, four zero. 8 1.2 budget amendments? 9 MRS. JOHNSON: There is none. 10 JUDGE KELLY: 1.3 late bills? 11 MRS. JOHNSON: There is none. 12 JUDGE KELLY: And 1.4 approve the payroll. 13 MRS. JOHNSON: Payroll is $782,392.67. 14 COMMISSIONER HARRIS: I move to accept the 15 payroll as read. 16 COMMISSIONER LETZ: Second. 17 JUDGE KELLY: Commissioner Harris has moved, 18 and Commissioner Letz has seconded approval of the 19 payroll. Those in favor? Is there any other discussion 20 before we do that? 21 COMMISSIONER MOSER: No. 22 JUDGE KELLY: Okay. Those in favor raise 23 your hand. 4-0, unanimous. 24 Next is 1.5, and we have Kerrville City 25 Manager Mark McDaniel here to talk to us about the City 5 1 of Kerrville requesting a Resolution in support of its 2 legislative effort to use the Hotel Occupancy Tax for a 3 convention center and hotel in Kerrville. 4 MR. MCDANIEL: Good morning, Judge, 5 Commissioners. I appreciate you allowing me to be here 6 today and speak with you about a very exciting, very 7 important project for Kerrville. As you all know we've 8 been talking about a hotel conference center in this 9 community for years. And tourism is a huge part of our 10 economy. We haven't been able to get the ball across 11 the goal line, so to speak, because of the level of 12 public investment that's required to make that 13 conference center happen. That's been the large reason 14 why it hasn't happened. 15 So today what we're asking y'all for is just 16 support, your support, the community's support for us to 17 pursue legislation in this session of the legislature to 18 acquire the State's portion of the hotel tax. So in 19 Kerrville if you stay in a hotel room, you're going to 20 pay 13 percent hotel tax. Seven percent of that goes to 21 the City, the other six percent goes to the State. And 22 so there's a program that 39 other cities have taken 23 advantage of already since its inception where they are 24 eligible to receive ten years of that six percent. A 25 hundred percent of that six percent over ten years to 6 1 help fund a hotel conference center. 2 So for us, we did a study, a hotel 3 conference center study. We've done these before in the 4 past, I know, both public sector and private sector, but 5 we wanted to update that study, and we did that last 6 year. And that study revealed that yes, in fact we can 7 support a full service hotel conference center. Went 8 into some detail about how large, and looked at 9 different parts of town. Did not identify any specific 10 parcel, but looked at different parts of town, made some 11 recommendations in that regard. Looked at the local 12 economic impact, and then also looked at the pro forma 13 for the performance, the financial performance, of a new 14 hotel conference center so they could determine what the 15 level of public investment might be. And of course, 16 it's all an estimate, it's all just a study. Reality is 17 that we won't know what those final numbers are until we 18 have a partner and we start negotiating, and who's going 19 to pay for what kind of a thing, and how big is it 20 really going to be and where it's really going to go, 21 and that's all down the road. But all that's really 22 moot unless we get this state funding. And so this is 23 not new tax, it's a tax already assessed. Mostly the 24 people that are coming to Kerrville; not those that live 25 here, but obviously some have family and so forth that 7 1 stay in hotels. But this would be just getting the 2 State's portion. 3 And so we have Senator Buckingham and 4 Representative Murr that have agreed to sponsor our 5 bill, but they also want to see local support. So this 6 week the City Council adopted a Resolution and, Judge, 7 may I approach the bench? 8 JUDGE KELLY: Please. 9 MR. MCDANIEL: So this is the Resolution 10 that the City adopted. And I know it's not an action 11 item on your agenda for today, but this is something 12 that we -- something similar to this is what we would 13 respectfully request from the Commissioners' Court so 14 that we can then forward that along to Representative 15 Murr and Senator Buckingham for their information. 16 So with this, Judge, I'd be happy to take 17 any questions from the Court. 18 COMMISSIONER HARRIS: Mark, what do you 19 think the odds are to get that state funding? 20 MR. MCDANIEL: You know, they're pretty 21 good. Their last session there were a number of cities 22 that acquired it. Out of the 39 cities that have 23 received that approval there is only about maybe ten 24 that have actually pulled the trigger and taken 25 advantage of it, because as I said earlier this is 8 1 one -- just one piece of the funding. You know, the 2 City may also move to do its portion of the hotel tax to 3 make it happen as well. 4 Y'all have all heard about what's going on 5 in Fredericksburg, for example, at their conference 6 center. Well, they're doing the same thing. It's not 7 funded yet. They're going after the same state funding, 8 and so -- but there's other funding involved beyond just 9 the State's portion, and that's why it's been difficult 10 for other cities to do that. We have the luxury of also 11 TDIC and other sources if necessary, kind of stack the 12 level of public investment, you know, depending on what 13 the counsel ultimately decides. So I think the chances 14 are good that we'll be able to receive this 15 authorization and, you know, that'll put us in really 16 good position. 17 COMMISSIONER MOSER: Mark, let me understand 18 what you're asking the Court to do. You and I have met 19 and talked about this. But this is a multi-step 20 process. This is a very early step in the process, and 21 so you haven't selected the site, you've done a study 22 says looks feasible. You haven't selected or negotiated 23 or established the relationship with private sector to 24 do this, so you are asking the Court to just endorse the 25 concept in this legislative session of having the State 9 1 grant the six percent to be allocated back to this 2 project, if in fact it takes step 2, 3, 4, 5, 6 on down 3 the road, is that correct? 4 MR. MCDANIEL: Yes, Sir, all of that's 5 correct. 6 COMMISSIONER MOSER: So very clearly that's 7 not a commitment by the County for any rebate or 8 anything else; it's just that it's a -- essentially a 9 public endorsement of letting this process proceed. 10 Another question, if I may. And I'm -- and 11 I understand that it's needed now just because of where 12 the legislative session is. It's just beginning. I 13 guess it began yesterday or something. 14 JUDGE KELLY: Tuesday. 15 COMMISSIONER MOSER: Tuesday, okay. So that 16 that's important in this session. Now a question would 17 be -- would arise why this year, why not two years from 18 now, or something when the legislature comes back again? 19 Perhaps even putting on a referendum, okay, for the City 20 to see what the public thinks about this, but you 21 couldn't make it in this legislative session if you did 22 that. So has that been discussed at all? 23 MR. MCDANIEL: Yeah, I think given our 24 surveying that we've done over the years and the 25 feedback we have gotten from the community over the 10 1 years there's clearly an interest. In fact there was 2 some criticism that we weren't further ahead when 3 Fredericksburg made its announcement about the project. 4 And again it's something that the City has tried on a 5 number of occasions. It's just the numbers did not -- 6 couldn't get the numbers to work. Because I've looked 7 back through all the files of the prior city managers 8 and talked to others about their efforts. So I think 9 it's clearly something that the community has expressed 10 is something that they want to do and, you know, we just 11 don't want to wait another two years. 12 Our study makes some assumptions about a 13 start date and so we don't want to have to go and also 14 update our study. Not that it was terribly expensive, 15 but that's yet another effort to have to go through if 16 we needed to do that. 17 We also have some strong support from 18 Representative Murr and Senator Buckingham to carry our 19 bill. And in the end our bill may be mixed up with 20 somebody else's bill, you all know how that works as it 21 works its way through the legislature. And there's also 22 a number of other cities that are having interest in 23 doing this. And we don't know if at some point, maybe 24 even the next session, that the legislature comes back 25 and say, you know, we're not going to do this program 11 1 anymore, everybody else that is grandfathered is taken 2 care of, you know, taken advantage of it. You know, we 3 don't want to do this program anymore. That's always 4 possible. 5 COMMISSIONER MOSER: Is that study available 6 to the public? 7 MR. MCDANIEL: It is not, and the reason for 8 that is it's an economic development item. There's a 9 lot of information in there that in dealing with a 10 prospective partner on this project that is pretty 11 sensitive in terms of negotiating, so we don't want to 12 show our cards so to speak in terms of negotiating with 13 a prospect. 14 COMMISSIONER MOSER: So you are essentially 15 saying take this draft Resolution and for us to come 16 forward at perhaps the next session, or something, the 17 Court to pass a Resolution on this? 18 MR. MCDANIEL: Yes, Sir. 19 JUDGE KELLY: Well, it's set on the regular 20 Commissioners' Court meeting on the 14th. 21 COMMISSIONER MOSER: Okay. 22 COMMISSIONER LETZ: I've met with Mark as 23 well, and I think it's a good idea, this project. I 24 think a couple of things that are important to let 25 the -- and I don't know how you want to do this, let the 12 1 public know. To me it's a hotel convention center; not 2 a convention hotel, as you mentioned. The reason is 3 from talking with you it's basically an updated new 4 version of what the YO has, the YO Hotel has, and the 5 Inn of the Hills has, and a little bit different in 6 updating to today's standards, so it's really not a 7 convention center as much as it's a new hotel with 8 convention sites. 9 MR. MCDANIEL: What will likely be the 10 arrangement is that the convention center would be if we 11 got the State funding. The State funding requires that 12 the City own the conference center and the land. The 13 hotel -- we don't want to be in the hotel business, so 14 our partner would own the hotel, so it is different in 15 what we have today, and it probably will end up being a 16 little larger in terms of some of the meeting space. 17 But one doesn't work without the other. The hotel's got 18 to be right there with the conference center, and they 19 could be two separate buildings, or just connected by a 20 breezeway, or skybridge, or whatever. We have all that 21 in terms. 22 COMMISSIONER LETZ: Well, similar to what 23 San Marcos has, I think they have Embassy Suites and a 24 conference center. 25 MR. MCDANIEL: Yes, Sir. 13 1 COMMISSIONER MOSER: So this would be -- the 2 process, if it gets to the legislature, then it would be 3 City complete their analysis and pro forma and 4 relationship with the private sector -- 5 MR. MCDANIEL: Right. 6 COMMISSIONER MOSER: -- and then what will 7 it be, City Council say yeah or nay, and that's it? 8 MR. MCDANIEL: Well, it's several steps. So 9 we would try to identify a partner first of all, do an 10 RFP and identify a partner. And then working with that 11 partner, we would identify a site, a prospective site 12 and work on that. And we would look at obviously the 13 negotiated deal in terms of how much public investment 14 there is going to be versus how much private investment, 15 and so that obviously takes awhile, and even sometimes 16 years to get to where you need to be. But without the 17 State funding, again, there's no point in really talking 18 about it. 19 COMMISSIONER MOSER: So without that there's 20 no need in going down that path? 21 MR. MCDANIEL: Yes, Sir. 22 COMMISSIONER MOSER: Gotcha. 23 JUDGE KELLY: But to make it perfectly clear 24 to the public, the City's not asking the County for any 25 money; you're asking us for public support of a project 14 1 that the City's underwriting? 2 MR. MCDANIEL: That's correct, Judge. 3 JUDGE KELLY: Along with the State of Texas? 4 MR. MCDANIEL: That's correct. 5 JUDGE KELLY: Okay. And just FYI, I was in 6 Austin for the opening of the legislature on Tuesday, 7 and Senator Buckingham did buttonhole me and did ask me 8 about this issue and is vitally concerned about trying 9 to move forward. 10 MR. MCDANIEL: Very good. 11 JUDGE KELLY: Any other discussion? Well, 12 we hope to see you back on Monday for the action item. 13 MR. MCDANIEL: Yes, Sir. Thank you very 14 much for your time. 15 COMMISSIONER MOSER: Yeah. Thanks, Mark. 16 JUDGE KELLY: The next item on the agenda is 17 1.6 consider, discuss and take appropriate action on 18 requests from the County Clerk, the Tax Assessor, and 19 District Clerk to appoint clerks and assistants for 20 their offices pursuant to Local Government Code Chapter 21 151. I see the Tax Assessor back there. Anyone want to 22 speak to this? 23 COMMISSIONER REEVES: I had submitted it to 24 Miss Grinstead prior to January 1st, Judge, and 25 paperwork, I guess, was forwarded to the Clerk's Office, 15 1 and I think it just needs approval. 2 COMMISSIONER LETZ: This is something that 3 was on the agenda for the 1st, but we didn't handle it 4 properly, bottom line, you know, so we just need to go 5 back and make a motion. I'll make a motion to approve 6 the request from the County Clerk, Tax Assessor, and 7 District Clerk to appoint clerks and assistants for 8 their offices pursuant to Local Government Code Chapter 9 151. 10 COMMISSIONER HARRIS: Second. 11 JUDGE KELLY: Okay, motion been made by 12 Commissioner Letz and seconded by Commissioner Harris. 13 Is there any other discussion? As I understand it, this 14 is just for them to get their staff up to full speed, is 15 that correct? 16 COMMISSIONER LETZ: Yeah. It's a 17 requirement of whenever they're elected. 18 JUDGE KELLY: Those in favor raise your 19 hand. Those opposed. It carries unanimously four zero. 20 Next item on the agenda is an executive 21 session matter. It's to consider, discuss and take 22 appropriate action regarding office space assignments. 23 So with that -- 24 COMMISSIONER LETZ: With that, I'm saying 25 County Attorney and Sheriff can stay in. It's related 16 1 to -- I'll just read it. Deliberations regarding 2 negotiating contract and courthouse security 3 potentially. 4 JUDGE KELLY: Okay, and before you leave, I 5 want to ask the County Attorney, if she would, please 6 introduce the new Assistant County Attorney. 7 MRS. STEBBINS: Sure, I would love to do 8 that. This is Jason Sorensen. He's our new Assistant 9 County Attorney, and he'll be handling Mental Health, 10 J.P. Court, and any other things that we can find for 11 him to do. 12 JUDGE KELLY: Welcome, Jason. Hopefully 13 this won't take long, so just be patient with us. 14 (Executive Session.) 15 JUDGE KELLY: Commissioners' Court is now 16 back in session. There being no action items to act on, 17 we'll entertain a privileged motion to adjourn. 18 COMMISSIONER MOSER: Second. I mean make 19 that motion we adjourn. 20 JUDGE KELLY: Okay, Court stands adjourned. 21 * * * * * * 22 23 24 25 17 1 STATE OF TEXAS * 2 COUNTY OF KERR * 3 I, DEBRA ELLEN GIFFORD, Certified Shorthand 4 Reporter in and for the State of Texas, and Official 5 Reporter in and for Kerr County, do hereby certify that 6 the above and foregoing pages contain and comprise a 7 true and correct transcription of the proceedings had in 8 the above-entitled Commissioners' Court. 9 Dated this the 24th day of January, A.D. 10 2019. 11 12 /s/DEBRA ELLEN GIFFORD Certified Shorthand Reporter 13 No. 953 Expiration Date 04/31/2020 14 * * * * * * 15 16 17 18 19 20 21 22 23 24 25