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Item 7C 1 C.) 10T4 BUILDER RECOVERY i SERVICES Southlake Construction Trash Ordinance Summary-9.21.21 Mayor&Council I wanted to be on record in opposition to a portion of the new solid waste ordinance as it relates to construction debris removal. I plan to speak at the public hearing however due to time constraints,I wanted to present this summary which encompasses a more comprehensive review than what might be possible tonight. Bio/Background Past and future Southlake residence who has been building,renovating,and developing here for over 20 years. Founder and owner of Garabedian Properties Custom Home Builder Local&national award-winning custom home builder with 30 years in the industry. President of The Greater Fort Worth Builders Association and local Government Affairs Liaison for the Texas Association of Builders Founded a construction waste hauling company specializing in service to builders,renovators,and general contractors (Builder Recovery Services LLC) The Issues The addition of a Construction Waste provision in the new ordinance has three primary problematic issues; • Licensing of only select construction waste haulers(NOT all of them) • Creating a license fee based upon a percentage of revenue(income tax) • Creates admirative and financial burdens which adds additional costs for Southlake residents and businesses Industry Outreach For two years our industry has offered to help staff create a policy/ordinance which addressed city concerns while not creating undo administrative and financial burdens on our local businesses and the residents. For whatever reason,staff repeatedly decided to NOT take up these outreaches and proceed down a different path. This is NOT the Southlake Way. Our Objections The proposed ordinance does NOT apply to most construction debris haulers and only applies to the construction debris haulers who just happen to directly compete with the city's Franchise Waste hauler. The proposed ordinance creates admirative burdens on only a few companies who haul waste,while others operate without any such burdens. The proposed ordinance creates financial burdens in the form of an income tax on select waste haulers. The fees charges have no relation to the cost of administering the license which is unlawful. There are no studies,reports or documentation validating the need or the structure of the proposed ordinance. P.O. Box 93984, Southlake,Texas 76092 / service@builderrecoveryservices.com/ 817.748.2669 i ... 4. BUILDER � R Ili RECOVERY J SERVICES SPIN Presentation Summary Staff(Lauren LaNeave)acknowledged that Southlake has no reports,studies,or data to support the proposed wording. Staff noted a license fee was required to offset the cost of wear and tear on city streets and moments later acknowledged that impact fees charged with building permits were to cover the very same wear and tear. Staff noted they had no knowledge of the weights of other vehicles used in construction including concrete trucks,brick delivery trucks and/or other vehicles used to haul construction waste. Staff noted they had no knowledge of the trip counts of other vehicles used in construction including concrete trucks, brick delivery trucks and/or other vehicles used to haul construction waste. Staff noted that the new ordinance on construction waste ONLY applied to companies that used roll off containers and did NOT apply to companies that hauled with trucks. • It seems odd that an ordinance on construction waste only applies to private companies who directly compete with the franchise holder and NOT other companies. Staff noted license fee was necessary for managing blowing trash and verifying haulers were tarped during transport. • It only focuses on blowing trash from only one type of hauler and apparently there is no enforcement necessary to make sure other trucks or trailers are tarped during transport. • Apparently,the only construction waste haulers that need to be checked during transport are only private companies who directly compete with the franchise holder. • No history of citations,enforcement actions,incidents or complaints have been documented showing a pattern or history from construction waste haulers being a significant issue. After SPIN It was noted that a license fee was necessary to create equity with the franchise holder. • Private companies executing private contracts between private parties on private property are NOT in any way related to exclusive franchise holders. • Franchise fees are"rent"for the use of public streets and right of way. o Placement of trash cans on the street for pick up o Placement of cables and utilities in the ROW o Private commerce on private property is NOT a franchise activity under any definition. • Companies that enter into Franchise Agreements do so voluntarily to secure exclusive contracts to utilize the ROW to haul ALL residential waste. The fact that they willfully contract to pay a fee to the city should by no means bind others to pay similar fees. • Using a city's police power to create restrictions on businesses who may compete with a franchise holder seems awkward at the very least. It was noted that this new policy was directly attributed to our company's outreach to start serving Southlake Builders. • We never requested a rewrite of any ordinance,we only wanted to offer a service to other builders which was legally permissible under current local and state laws. • For over 2 years we provided specific feedback on how a registration/license system could be formed. • Staff did NOT wish to engage in that conversation and created a program focused on one very specific part of the construction trash industry. • We have not seen any data or reports indicating our continued operations(or others like us)poses any burdens or impact on the city. • There is NO history of ANY type of citation or complaint on our operations in Southlake. • Staff noted to us that the registration fee(licensing fee)previously charged for operations such as ours was$75 years ago. P.O. Box 93984, Southlake,Texas 76092 / service@builderrecoveryservices.com / 817.748.2669 mT4 BUILDER owl RECOVERY J SERVICES License Fees • Texas law requires license fees only be equal to the amount required to administer the cost of a license. o Southlake builder registration fees are$105 NOT a percentage of revenue generated o Arbitrary percentages have no basis in administrative costs • License fees cannot be used for general revenue purposes • License fees as a percentage of revenue is a tax and there is NO provision in state law for such a tax • License fees as a percentage of revenue can't be equitable by definition • There is NO other license,registration or administrative fee charged by Southlake on a business that is based upon a percentage of revenue(excluding sales tax)that I am aware of. Even the Southlake Taxi license is based upon a flat fee and not the fare amount. Regulatory Requirements • The ordinance as proposed requires private companies to provide private financial information to the city which becomes part of the public record. • The ordinance ONLY applies reporting and regulatory restrictions against one portion of the construction clean up industry which just happens to be a direct competitor to the city's franchise waste hauler. • If you haul construction waste using trucks,you do not need to adhere to these regulatory requirements. • If you haul for only your own sites,you do not need to adhere to these regulatory requirements. o Apparently blowing trash or tarping is not a problem if it is from your construction site. • This targeted focus illustrates what we believe is the true purpose of this policy. Creating financial and regulatory burdens on companies that compete against large corporate franchise holders. Supreme Court Of Texas • As noted to staff in June and recently,there is litigation in front of the Supreme Court of Texas directly related to the use of percentage of income fees being used for licensing fees. o Briefs are being filed in Oct/Nov o We anticipate oral arguments in the Spring • Builder Recovery Services LLC won at the district court level that a fee on gross revenue of 15%was not lawful. The Southlake Way • For the past 20 years Southlake has been a leader in reaching out to businesses and to work collaboratively on crafting policies which address community needs while minimizing regulatory burdens on local businesses. • Over the past 20 years,I have personally spent umpteenth hours in meetings,on calls or in sessions in the 3rd floor conference room with staff to discuss implantation of code adoptions,policy changes,etc.... • For some reason albeit for two years such industry outreach was not engaged by staff. This is not The Southlake Way. Our Recommendation • The construction waste portion of this ordinance be tabled until such a time that; o Staff be directed to work with building industry to create a new ordinance o Staff be directed to NOT create a tax-based licensing fee system. o Staff be directed that ANY licensing of construction waste haulers be equitable in its enforcement o Staff be directed to wait for the Supreme Court's ruling before adopting a new fee structure. Thank you for your time and consideration. I look forward to visiting further on this matter during the public hearing or via phone or in person. Sincerely Michael Garabedian P.O. Box 93984, Southlake, Texas 76092 / service@builderrecoveryservices.com / 817.748.2669 t6 Southlake City Council meeting Public Comment Form Please print. Return completed form to City Secretary prior to start of reeg ar s sion. Name: 11 We A er.u IAA Date: / 1/ ,f Address: 4- 174c/71ti6_ Phone:� 3 (Include City and State) I wish to share my vie . ; •,• . • genda Item: Agenda Item# I will speak m I 'PORT of this item 4) I will speak in OPPOSITION to this item I do not wish to speak, but please record my SUPPORT OPPOSITION UI wish to speak during Public Fo on an ' m not on tonight's agenda Topic: Note: To allow everyone an port ity to e he ,please limit your comments to 3 minutes. Signature: Required: Cards wil of b read into the recor u lessless ied