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Item 6GCITY OF SOUTH LAKE MEMORANDUM (February 10, 2015) To: Shana Yelverton, City Manager From: Ben Thatcher, Assistant City Manager Subject: Item 6G: Ordinance No. 1112, 2nd Reading, Approve an ordinance calling a special election to determine whether the voters of the City of Southlake desire to levy a sales and use tax to promote economic development in the city and to fund a community entertainment and recreation center and reduce the sales and use tax for the Southlake Crime Control and Prevention District Action Requested: Approve Ordinance No. 1112, 2nd Reading, as noted above Background Information: The purpose of this item is to call for a special election on May 9 to ask voters to approve reducing the Crime Control & Prevention District rate (from 1/2 cent to 1/8 cent) while at the same time create a new Type A sales tax district (rate of 3/8 cent) to fund the construction and operations of the community recreation center and to allow for the promotion of economic development. Under state law all special sales tax districts require voter approval. As City Council has discussed the many different possibilities to build the community recreation center over the last few years it was determined by the City Council that the best method to fund phase II of this project would be to use dedicated sales tax revenue. Currently the City is utilizing its full portion of sales tax allowance, and has identified the Crime Control and Prevention District as a possible area to repurpose existing sales tax rates. Now that the CCPD has completed building each of its public safety buildings as it was created to do in the 90s, an 1/8t" of a cent is all that is needed to provide funding for the School Resource Officer program going forward. Municipalities are allowed by the State to utilize a variety of special purpose districts, and the City Council considered several options at their January 2013 winter workshop as well as at their March 4,2014 City Council meeting. During the worksession of the March 4, 2014 City Council meeting the City Council chose to pursue the creation of a Type A sales tax district because it afforded the most flexibility to the City. At that meeting staff was also directed to bring this proposition to Southlake voters in May 2015. The proposed language for the proposition has been crafted in conformance with state law and per the City Attorney's recommendation. It is designed so that the action of reducing the CCPD rate and creating the new Type A district will take affect simultaneously. The ballot language will read: "The decrease of the one-half percent (1/2%) Crime Control and Prevention District sales and use tax to one -eighth percent (1/8%) and the adoption of a sales and use tax for the promotion and development of new and expanded business enterprises at the rate of three -eighths percent (3/8%) to be used for projects authorized by Chapters 504 and 505 of the Texas Local Government Code, including specifically a community entertainment and recreational center and land, buildings, equipment, facilities, or improvements that provide new or expanded business enterprises that create or retain primary jobs as authorized by Section 505.155 of the Texas Local Government Code, including maintenance and operation costs of an authorized project." A "yes" vote for this proposition will authorize the reduction of the CCPD rate and the creation of the Type A district and subsequent rate. A "no" vote will keep the CCPD sales tax at its current rate. It must be noted that the CCPD is scheduled to sunset in 2018, and a later election will still be required to reauthorize that district regardless of the outcome of this special election. Financial Considerations: The proposed special election will coincide with the City's general election in May and will not incur any additional expenses. Strategic Link: This item supports the City's strategy map through objective C3 - Provide attractive & unique spaces for the enjoyment of personal interests. The community recreation center is also in accordance with recommendations in the City's Southlake 2030 Plan and therefore this special election call aligns with CBO1 — Continue to implement Southlake 2030 Plan by focusing on short-term initiatives. Citizen Input/ Board Review: CCPD has been involved in this process and is aware that this special election will be called for May 9. Legal Review: Ordinance was created by TOASE. Alternatives: 1. Approve the Ordinance calling for the special election. 2. Take no action on the Ordinance and choose not to hold the special election this May. Supporting Documents: Ordinance No. 1112 Staff Recommendation: Approve Ordinance No. 1112, 2nd Reading. Staff Contact: Ben Thatcher, Assistant City Manager ORDINANCE NO. 1112 AN ORDINANCE CALLING A SPECIAL ELECTION TO DETERMINE WHETHER THE VOTERS OF THE CITY OF SOUTHLAKE DESIRE TO LEVY A SALES AND USE TAX TO PROMOTE ECONOMIC DEVELOPMENT IN THE CITY AND TO FUND A COMMUNITY ENTERTAINMENT AND RECREATION CENTER AND REDUCE THE SALES AND USE TAX FOR THE SOUTHLAKE CRIME CONTROL AND PREVENTION DISTRICT; PROVIDING FOR ELECTION PROCEDURES; PROVIDING THAT THIS ORDINANCE SHALL BE CUMULATIVE OF ALL ORDINANCES; PROVIDING A SEVERABILITY CLAUSE; PROVIDING FOR ENGROSSMENT AND ENROLMENT; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Southlake is a home rule city acting under its charter adopted by the electorate pursuant to Article XI, Section 5 of the Texas Constitution and Chapter 9 of the Local Government Code; and WHEREAS, the Development Corporation Act of 1979, codified in Chapters 501 et seq. of the Texas Local Government Code (the "Act"), provides that certain eligible cities may create an industrial development corporation to be funded by a sales and use tax to promote economic development in the city, if the tax is authorized by a majority of the qualified voters; and WHEREAS, the City of Southlake is an eligible city as defined by Section 504.002 of the Act; and WHEREAS, Section 504.152 of the Act allows the voters to allow the corporation to expend funds for certain specified projects or project categories if approved by the voters; and WHEREAS, Section 321.108 of the Tax Code provides that a municipality can call an election to reduce the amount of sales and use tax collected for the benefit of a municipal crime control and prevention district; and WHEREAS, the Act provides that an election shall be held in accordance with Chapter 321 of the Tax Code; and WHEREAS, Section 321.409 of the Tax Code authorizes combined ballot propositions; and WHEREAS, Section 321.401 of the Tax Code provides that the governing body of a municipality may call an election by the adoption of an ordinance approved by the vote of a majority of its members; and WHEREAS, Section 321.403 of the Tax Code states that such an election must be held on the first succeeding uniform date for which sufficient time elapses for the holding of an election; and WHEREAS, Section 41.001 of the Texas Election Code (the "Code") specifies that May 9, 2015 is a uniform election date; and WHEREAS, this special election shall be held in conjunction with the general election to be held on the same date. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF SOUTHLAKE, TEXAS: SECTION 1) ELECTION CALLED A special election shall be held on Saturday, May 9, 2015, to submit to the voters a proposition to determine whether to authorize the adoption of a three -eighths (3/8) of one percent (1 %) sales and use tax for the promotion of economic development in the city to be used for projects, improvements and costs as permitted by Chapters 501, 504, and 505 of the Act, as amended, and at the same time reduce the tax for the Southlake Crime Control and Prevention District from one-half (1/2) to one -eighths (1/8). SECTION 2) BALLOT The official ballots for said election shall be prepared in accordance with the Texas Election Code so as to permit the electors to vote "FOR" or "AGAINST" the proposition, with the ballots to contain such provisions, markings and language as required by law, and with such proposition to be expressed substantially as follows: PROPOSED The decrease of the one-half percent (1/2%) Crime Control and Prevention District sales and use tax to one -eighth percent (1/8%) and the adoption of a sales and use tax for the promotion and FOR () development of new and expanded business enterprises at the rate of three -eighths percent (3/8%) to be used for projects authorized by Chapters 504 and 505 of the Texas Local Government Code, including specifically a community entertainment and recreational AGAINST () center and land, buildings, equipment, facilities, or improvements that provide new or expanded business enterprises that create or retain primary jobs as authorized by Section 505.155 of the Texas Local Government Code, including maintenance and operation costs of an authorized project. SECTION 3) POLLING PLACE The polling place for the special election shall be at Southlake City Hall, located at 1400 Main Street, Suite 460, Southlake, Texas 76092. Voting shall be conducted between the hours of 7:00 a.m. and 7:00 p.m. SECTION 4) PROCEDURES FOR THE SPECIAL ELECTION The special election shall be held in conjunction with the general election. The City intends to enter into an agreement for election services with Tarrant and Denton Counties (the "Agreements"). Procedures for the general and special election will be established in Resolution No. 15-009 calling the general election and in the Agreements. SECTION 5) PUBLICATION AND POSTING OF NOTICE OF ELECTION Notice of the election shall be published twice no earlier than April 9, 2015, and no later than April 29, 2015, in the newspaper in accordance with the provisions of the Code. Additionally, notice shall be posted no later than April 20, 2015, in the regular place for posting notice of meetings of the city council of the city, and shall remain posted continuously through election day, May 9, 2015. SECTION 6) EARLY VOTING Early Voting by personal appearance shall be conducted beginning on April 27, 2015, and continuing through May 5, 2015, on days, at times and at locations specified in Resolution No. 15-009 calling the general election and in the Agreements. SECTION 7) GOVERNING LAW The election shall be held in accordance with the constitution of the United States and the Texas Election Code, and Chapter 321 of the Texas Tax Code, and all resident qualified voters of the city shall be eligible to vote in the election. SECTION 8) This ordinance shall be cumulative of all provisions of ordinances and of the Code of Ordinances of the City of Southlake, Texas, as amended, except where the provisions of this ordinance are in direct conflict with the provisions of such ordinances and such Code, in which event the conflicting provisions of such ordinances and such Code are hereby repealed. SECTION 9) It is hereby declared to be the intention of the City Council that the phrases, clauses, sentences, paragraphs, and sections of this ordinance are severable, and if any phrase, clause, sentence paragraph or section of this ordinance shall be declared unconstitutional by the valid judgment or decree of any court of competent jurisdiction, such unconstitutionality shall not affect any of the remaining phrases, clauses, sentences, paragraphs and sections of this ordinance, since the same would have been enacted by the City Council without the incorporation in this ordinance of any such unconstitutional phrase, clause, sentence, paragraph or section. SECTION 10) This ordinance shall be in full force and effect after its passage and publication as required by law, and it is so ordained. PASSED AND APPROVED ON FIRST READING this 3rd day of February, 2015. John Terrell, Mayor ATTEST: Lori Payne, City Secretary PASSED AND APPROVED ON SECOND READING this 17'h day of February, 2015. John Terrell, Mayor ATTEST: Lori Payne, City Secretary EFFECTIVE: APPROVED AS TO FORM AND LEGALITY: City Attorney