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HomeMy WebLinkAboutResolution 3711-02-2009A Resolution NO 3711-02 2009 ADOPTING REVISED POLICY AND GUIDELINES FOR PUBLIC IMPROVEMENTS DISTRICTS WHEREAS, the City Council is authorized to create public improvement distracts ("PIDs") pursuant to Chapter 372 of the Texas Local Government Code; and WHEREAS, the City is responsible for ultimate administration of PIDs created by the City Council, and WHEREAS the City Council wishes to adopt a revised and updated Policy and Guidelines regarding standards for creation, management, and administration of PIDs created by the City Council in order to give all affected and interested persons and entities a clear understanding of the City's expectations regarding its PIDs, NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS, THAT 1 The attached revised Policy and Guidelines for Public Improvement Districts is hereby adopted, and all previous policies related to PIDs created by the City Council are hereby repealed. 2. This Resolution shall take effect on the date of its adoption Adopted this 3=d day of February 2009 ATTEST B y -- --- - Marty Hendrix City Secretary ORT WORT i Policy and Guidelines for Public Improvement Districts POLICY OVERVIEW Public Improvement Districts ("PIDs") provide a development tool that allocates costs according to the benefits received. A PID can provide a means to fund supplemental services and improvements to meet community needs which could not otherwise be constructed or provided and be paid by those who most benefit from them. The purpose of the PID policy is to outline the issues to be addressed before the City Council can support the establishment and continuation of a public improvement distract. The policy outlines such things as petition requirements, information to property owners, and deternunarion of annual plan of services, budget and assessments. It addresses City adrninistration issues, which are in addition to the requirements of state law I. GENERAL 1 PIDs must be self-sufficient and not adversely impact the ordinary service delivery of the City except where City Council elects to participate m the project's costs. 2 PIDs must be established carefully and only when related to a public purpose to avoid a proliferation of special distracts. 3 PID petition signatures should reflect that a reasonable attempt was made to obtain full support of the PID by the majority of the property owners. 4 Praority will be given to PIDs for• (a) Improvements m the public right-of way (e.g., entryways, landscaping, fountains, specialty lighting, streets and sidewalks), (b) Improvements which meet community needs (e.g., drainage improvements, parks and off-street parking facilities) and (c) Improvements related to operations and maintenance expense (e.g., sidewalk and street cleaning) FLIRT WORTH Policy and Guidelines for Public Improvement District 5 Secondary consideration will be grven for other supplemental servrces" Very careful consrderatron must be given before City Council will support a PID for improvements, whrch requrre bond financing. Use of assessments for partial recovery of a developer's capital costs will be allowed only m special cases where extraordinary public benefit rs shown. Only those capital costs associated wrth continuing drstrrct services will be considered for partial recovery 6 A PID's budget shall include sufficient funds to pay for all costs above and beyond the Crty's ordinary costs, including addrtronal administrative and/or operational costs as well as addrtional maintenance costs resulting from the PID 7 The petrtion should include the notatron that it rs the City's right to maintain the project, wrth input from the exrstrng advisory body and assess the property owners of their appropriate share of the costs rf the management firm's work is unsatisfactory 8 Anyone sellrng land in a public improvement district must rnclude a 'trtle encumbrance" whrch notifies any prospectrve property owner of the exrstence or proposal of special assessments on the property All closing statements must specrfy who rs responsible for payment of the PID assessment on a pro rata share thereof. II. PETITION REQUIItEMENTS For a drstrict to be establrshed, a petrtron shall include the following: 1 Assurance of long-term backing and support. 2 Sunset clause or procedures outlined for publrc revrew of the success of the PID and a determination of property owners whether to contrnue wrth the drstrict or drssolve it. Evrdence that the petrtron s srgnatures meet the state law requrrements or the petrtion will be accompanied by a reasonable fee to cover the city costs of srgnature verificatron. If the proposed distrrct rs an expansron of an exrsting district, a petrtion for the new portron of the distrrct must rdentrfy each subdrvisron, or portion thereof, wrthin the proposed boundarres of the new drstrict, and each subdivisron or portron thereof, that is not currently rn an existing PID shall individually satrsfy the requirements for a petrtron under Sectron 372 005 of the Texas Local Government Code. Subdrvrsion has the meanrng assrgned by Section 232 021 of the Texas Local Government Code. 4 Contingency plan to address the maintenance or disposition of PID improvements and or property that has not been dedicated to the public if a PID is drssolved. 5 Map of the area, description of the boundarres of the distrrct for the legal notrces and a commonly known description of the area to be included in the drstrict. Page 2 of 8 FLIRT WORTH Policy and Guidelines for Public Improvement District 6 A section, which clearly identifies the benefit of the PID to the affected property owners (for use in benefit hearings) and to the city as a whole (i.e., public purpose) 7 Description of all city-owned land within the district as well as its proposed share of project costs. 8 Types of activities the District organization will undertake and who will determine those activities. 9 A Budget, including District s revenue m addition to the assessments, and how all funds will be managed. 10 Staffing needs. 11 Documentation of adequate liability insurance. 12 Specified procedure for eventual termination of the district. 13 Specified assurances to the City that the construction of improvements m the public nght-of way will be maintained by the PID and m no way obligates the Crty to future maintenance or operational costs, unless otherwise stated m a subsequent agreement. 14 Statement that the petitioners understand that the annual budget for the district is subject to review by city staff with final approval by the City Council. In addition, the following issues must be addressed before the City Council will take action on a petition. 1 An application fee" will be paid by the applicant to reimburse the city for the cost of evaluating the petition. Any unexpended portion of the fee shall be reimbursed to the PID or applicant when the evaluation is complete 2 A petition will be viewed more favorably if rt has attached a current tax roll with the signatures of the owners registering support of the petition next to the account for the owner's property on the tax rolls. 3 All estimated costs must be identified before a decision is reached on a request to establish a PID Costs to be identified include costs related to establishing the district; costs for maintenance, operations and administration, and costs for later revision, repair or replacement of any improvements. 4 A professional management plan must be submitted for review and approval before the petition is submitted (e g., who will address issues as they arise and how they will be addressed) 5 For a residential PID the City Council will look more favorably on a petition where the developer of a new subdivision has put m place an active homeowners organization. Page 3 of 8 F~ QRT WORTH Policy and Guidelines for Public Improvement District Any management firm for the PID property owners in the PID to rev' Services, and to attend the annual action. shall be required to hold iew and comment on the public hearing before th a public meeting for Budget and Plan of e City Council takes Page 4 of 8 FART 1'1!QRTH Policy and Guidelines for Public Improvement District GUIDELINES OVERVIEW These guidelines are written to assist m the operations and management of a Public Improvement Distract ("PID"), and are not intended to be an all inclusive list. Of primary consideration, are the statutes outlined in Chapter 372 of the Texas Local Government Code, (http.//tlo2 tlc.state.tx.us/statutes/lg.toc.htm) and the City of Fort Worth Public Improvement District Policy as amended on March 23 1999 I. ESTABLISHMENT A Public Improvement District (PID) is a defined area of properties, whose owners have petitioned the City to form a PID City Council establishes a PID by adoption of a resolution after a public hearing. The public hearing is publicized and written notification of the hearing is mailed to all property owners in the proposed PID By petition, the owners pledge to pay an assessment in order to receive enhanced services and/or improvements within the District. The PID must demonstrate that it confers a benefit, not only to the propert~.es within the District, but also to the `public which includes the entire City The establishment of an Advisory Body should be addressed in the petition. Statutes allow the City Council to appoint: the Advisory Body However City Staff can elect that an existing organization with direct ties to the PID serve as the advisory body Such organizations may be Homeo~mers Associations, Business Associations, Historical Associations, etc. On an annual basis the criteria for the Advisory Body will be reviewed by the City Attorney and if necessary changes will be implemented. II. GOVERNANCE City staff shall adrnimster all PIDs in accordance with the City's PID Policy III. PID MANAGEMENT 1 The City may contract with a management company to manage the PID subject to administrative oversight by City staff. 2 The management company will coordinate development of the Budget and Five Year Service Plan with the advisory body selected by the City Council for such purpose (or any other group that is representative of the property owners), which will be submitted to the City Council for consideration following a public hearing conducted in accordance with State law a. The management company seeks input from the designated advisory body and/or the property owners regarding the needs of the District. b The management company communicates to all property owners within the District, regarding events, activities, or other news in the District. Page 5 of 8 FORT WORTH Policy end Guidelines for Public Improvement District c. Minutes must be submitted to the City within forty five days following each Board meeting. 3 The management company either performs the work or subcontracts the work to be performed m the District. a. Coordinates between the City and the Advisory Body to effectively accomplish the work in the Distract according to the adopted Service Plan and within State law b Attends all PID Advisory Body meetings and other PID committee meetings, as necessary 4 The City's PID Administrator should be notified of the time and place of all PID membership and advisory board meetings. 5 A member of a PID advisory board appointed by the City Council in accordance with Section 372 008 of the Texas Local Government Code cannot have a financial interest, either directly or indirectly with the entity under contract to manage the PID or m any contract or other expenditure for improvements or services in the PID IV ASSESSMENTS 1 By ordinance, the City annually levies the assessments on the properties in the District m accordance with the petition. 2 The City has contracted with. Tarrant County Tax Office for billing and collecting the PID assessments. 3 The PID assessment is billed on the property owner's annual ad valorem tax statement. 4 The Crty provides the PID funding on a reimbursement basis, based on invoices submitted by the Management Company V SERVICE PLAN State law specifically outlines the improvements that may be adopted in the Five Year Service Plan and provided for m the District s annual Budget. 1 The City of Fort Worth utilizes PIDs for operations and maintenance projects which may include: • Landscaping; • Erection of fountains, distinctive lighting, and signs, • Construction or improvement of pedestrian trails, • Acquisition and installation of pieces of art; • Acquisition, construction, or improvement ofoff-street parking facilities, • The establishment or improvement of parks, Page 6 of 8 FLIRT WORTH Policy and Guidelines for Public Improvement District Acquisition, by purchase or otherwise, of real property m connection with an authorized improvement; Special supplemental services for improvement and promotion of the District, including services relating to advertising, promotion, health and sanitation, public safety security business recruitment, development, recreation, and cultural enhancement; and Payment of expenses incurred m the establishment, administration, and operation of the District. 2 Budgets should be developed with the concept that the entire PID will benefit. 3 Annual budgets should be supplemented by a detailed line item explanation of the varaous components and how the amount was derived. VI. EXPENDITURE REIMBURSEMENTS 1 The Management Company will periodically but not more frequently than monthly present to the City an invoice with the following information. a. Report of services rendered and documents evidencing payments made for District services for the reporting period, b The City shall reimburse the Management Company within fifteen (15) business days for District services within the limit of assessments actually collected. c Management payments for adrrunistration of a PID should not exceed 20% of current year assessment. Adnumstrative costs consist of, but are not hrmted to rent, office supplies, salaries, and other expenses necessary for the oversight of PID projects. The Management Company must follow State Statutes regarding authorized expenditures within a PID 3 Expenditures must fall in the general category as outlined in the Texas Local Government Code governing Public Improvement Distracts, as stated in Section IV above. 4 Any purchases of goods or services or any purchase contract that is subject to annual renewal, that is more than 4% of the total budget m any given year requires 3 bid requests by qualified vendors before the purchase may be made. Exceptions are emergency situations, long-1:erm contracts (negotiated for cost management before January 1 2009), and professional services approved m the budget. This is subject to annual review by City staff. 5 The Management Company shall make a peraodic work report, no less than quarterly detailing the Management Company's significant work activities. Page 7 of 8 VII. FINANCIAL REPORTING 1 Financial Statements (Balance Sheet, Income Statement, and General Ledger) should be provided to the City's PID Administrator on a monthly basis. 2 Care should be taken to classify expenditures. Routine repairs and maintenance should not be classified as Capital Improvements. Capital Improvements involve the construction, purchase, or renovation of buildings, parks, streets, or other physical structures that will either enhance the property's overall value or increase its useful hfe. A capital improvement must have a useful hfe of five or more years. 3 Reserves should be maintained to cover the first three months of the fiscal year until tax receipts are received, however reserves should not exceed 75% of average yearly assessments. 4 The annual assessment rate should be supported by the required budget. An explanarion in writing of the reason for delaying or cancelling a project or expenditures in a given year which results m the increase of fund balance should be provided by the managemf;nt company to the PID Administrator pnor to the submission of the next year's budget. 5 An Income Statement comparing the budget to the projected year end balances should also be prepared on a quarterly basis. 6 CPA firms must change every 5~' year 7 The financial records for the PID are subject to review by City of Fort Worth personnel at any time. VIII. DISPUTE RESOLUTION 1 Any disputes between the Management Company and the PID Advisory Board may be directed to the City of Forl: Worth PID City Attorney or Administrator 2 Either party may appeal the decision of the City's PID Attorney or Administrator to the Director of the Department in which the PID program is assigned. 3 Decisions made by the Director maybe appealed to the City Manager City of 1=ort Worth, Texas Mayor and Council Communication ~__~~ _ ~ ~_ ~-~z LL _. -^-_- ~ e ____ COUNCIL ACTION: Approved'A<; Amended on 2/3/2009 Res. No. 371'1-02-2009 -- ,m~ .. M DATE Tuesday February 03 2009 REFERENCE NO G-16451 LOG NAME 17PID POL&GUID SUBJECT Adopt Resolution Revising the Policy and Guidelines for Public Improvement Districts RECOMMENDATION It is recommended that the City Council adopt the attached resolution adopting a revised Policy and Guidelines for Public Improvement Districts (see attachment). DISCUSSION In September of 1991 the City Council adopted the initial Policy for Public Improvement Districts (the Policy) to outline the petition requirements for establishing a Public Improvement District (PID) In March 1999 the City Council revised the Policy to allow a subdivision to join an existing adjacent PID In July 2004 the City Council again amended the Policy to add guidelines and an administration fee Recently the City's Internal Audit Department began auditing the PIDs and the initial findings necessitate revising the Policy to insure better management of the PIDs by outside contractors with ultimate responsibility for PIDs resting with the City of Fort Worth.. The proposed revised Policy is attached to the proposed Resolution The most significant changes include A new Section III in the Guidelines called 'PID Management" which outlines the role of management companies In Section VI of the Guidelines, new language requiring the administration expenses be no more than 20 percent of the budget and requiring at least three bids on goods and services that are more than four percent of the budget; and A new Section VII in the Guidelines called 'Financial Reporting" which details the types of reports that management companies should submit and financial procedures that should be followed FISCAL INFORMATION /CERTIFICATION The Financial Management Services Director certifies that this action will have no material effect on City funds FUND CENTERS TO Fund/Account/Centers FROM Fund/Account/Centers CERTIFICATIONS Submitted for City Manager's Office b~ Tom Higgins (6140) Logname• 17PID POLGUID Page 1 of 2 Originating Department Head. Jay Chapa (5804) Additional Information Contact: Sylvia Flores (8550) Logname: 17PID POLGUID Page 2 of 2