Last night the Sandy Oaks City Council met for a budget hearing to discuss revenue and expenses. The meeting was less formal than a usual City Council meeting and allowed questions and comments from the audience. Mayor Jim Clement, whose job it is to create a budget, presented a budget that included over $300,000 in revenue and expenses.
Property tax made up 5/6 of the proposed revenue.
The City Council has the ability to set the rate of the property tax without a vote from the residents. Clement proposed a tax of 38 cents. With the proposed tax, the tax bill would be coming out in October 2014, just a few weeks away, and would be due by January 31, 2015. The new city tax is in addition to the current 31 cent county tax.
According to Mayor Clement, the Bexar County Appraisal District is now looking at the area of the city to be valued at over $80 million instead of the originally projected $64 million. He stated he wanted the city council to keep that in mind as they discussed the budget.
Leader of the Budget Hearing
The City Council openly discussed various different topics throughout the Hearing. They also answered and discussed items with members of the audience. But the person who provided the most answers to both the Council and audience members was the city attorney, Art Martinez de Vara, who is also the mayor of Von Ormy, Texas.
Here is a short list of the items Martinez de Vara explained:
- Why the county appraiser’s office valued the area at $84 million instead of the originally suspected $64 million
- The difference between real property and personal property
- That the budget is a living document that needs to be addressed quarterly by the Council
- That additional revenues such as sales tax need to be added in the future
- That the rule of thumb is to keep 1/3 of budget in a reserves fund in case of a catastrophe or a loss of revenue
- The difference between a fiscal year and budget year
- That the official start of the city was when the county judge signed the paperwork, even if there was no city government
- That the 2015 tax could not be set till September 2015
- That property tax is set by the council
- What a roll back tax election is
- That the Council should avoid setting a 0 cent tax to avoid a roll back election
- Stressed that if the council did not create a tax then the city would have no revenue for 2015
Art Martinez de Vara was the only person the City Council relied upon for information regarding the budget.
Issues Related to Spending
Because members of the audience could ask questions of the Council and provide input, many different topics were discussed including road maintinance, animal control, and other services.
Catherine Rendahl asked the Council “Well you still have county services for, how long, 3 years?”
No one from the City Council knew the answer. But one woman in the audience said she had already seen “Bexar County Maintenance End Here” signs on Mathis and Priest roads.
Pedro Orduno, Chairman of the Committee to Incorporate Sandy Oaks and the lead person behind the creation of the city, stood up and asked “We’re still in the process of eliminating the assessment fee from the Waterwood Development Company, right? So from my perspective, if we eliminate the $180, the maintenance fee, I always hope for a break even for myself personally… So where are we at on eliminating the $180?”
Alderman Micki Ball replied “That’s fine and dandy for the people in Waterwood. But that’s not who’s here. There’s a lot of people were this is an increase for them.”
Mayor Jim Clement quickly ended the topic by saying “That’s something other than the budget.”
Orduno later asked “I understand that we can make quarterly adjustments, but if this is the 2015 budget, what about the category for the park? And park maintenance, the swimming pool, the clubhouse?”
The Council explained that it’s not city property.
Grandfathering Businesses on Residential Properties
One audience member was upset about people operating businesses in residential areas. To this, Alderman Earnest Gay responded: “I think we’re going to have to grandfather these people and allow them to keep running their business as long as its running there, ’cause let’s face it, you’ve got several of them that are worth a lot of money out there. Several of them are also bringing in some pretty good, ah, sales tax money.”
Mayor Jim Clement Opposed to Tax Exemptions for Senior Citizens and Disabled
In the audience, BJ Gillespie said “I would like the Council to strongly consider some exemptions. There are some folks out here, when this tax bill hits them, it’s going to take food off their tables. It’s going to take medicine out of their bodies.
Mayor Clement’s response was “Well one of the things we have to consider is if we start giving, putting exemptions on [the budget]…the usable funds are going to decrease accordingly.”
Retroactive Property Tax For Sandy Oaks
Alderman David Tremblay asked the group what the taxable year would be. Art Martinez de Vara explained “The tax that you’re considering in 2014 is property tax, whatever you set it at, the bill will come out in October and be due January 31st…Theoretically, if you wanted to, you could retroactively impose a 2013 property tax. When Von Ormy incorporated we did that. So everybody got a double tax bill for that year.”
“Just for clarification,” said Catherine Rendahl in the audience, “You’re proposing to tax us from January of this year through December of this year when we weren’t even a city?”
Sandy Oaks, Texas incorporated in May of 2014 and didn’t have a government until August.
Art Martinez de Vara replied saying “Unfortunately the law doesn’t allow you to prorate it. So it’s either all or nothing. But the money is going to come into the [20]15 budget…but out of your [20]14 pocket.
“That doesn’t sound right to me,” said Rendahl, “That doesn’t even sound legal to me. You’re going to tax me for an entity that did not exist. What am I paying taxes for? I’m willing to pay any taxes that are required from the time we became a city, but not from last January.”
Mayor Jim Clement then said “Well like what Mr Martinez was just saying, there’s no prorating it halfway through the year. It’s all or none.”
Clement Claims CISO Didn’t Know About Retroactive Property Tax
Another audience member asked “Everyone in this community who has to plan ahead didn’t know that we were going to become a city. There’s the Committee to Incorporate Sandy Oaks [where] there’s about 3 or 4 people … that knew we were going to become a city, and everyone else did not know and could not budget it, and they’re going to have to pay [2014] taxes now?”
Clement stated “The people who were on the Committee to Incorporate had no idea about this either.”
This brought shouts of “Then why didn’t you research ahead of time?!” and “Well you should have known this before you got us into this mess!”
To one upset audience member Alderman Earnest Gay said “We can hear you just fine. Yelling doesn’t get your point across any better.”
Moments later Earnest Gay and rest of the city council voted unanimously in favor of the proposed retroactive property tax for 2014.
City Council Votes In Favor of a Retroactive Property Tax
For the budget itself, only SOPAC members Joel Ortega, Earnest Gay, and Douglas Tomasini voted in favor of it.
No line by line analysis was done on the $301,400 of expenses. No one asked why certain items cost what they did.
Next was the vote for the retroactive tax. David Tremplay motioned to set the tax rate at 30 cents per $100 evaluation and Micki Ball seconded the motion. The entire Sandy Oaks City Council then voted in favor of the tax.
“And that’s set for fiscal year 2015” said Alderman Micki Ball.
Art Martinez de Vara had to explain again that the Council could only vote on the 2014 rate.
“Then we’re not going to vote on it” replied Ball.
But they had already voted on it. Martinez de Vara explained that in addition to the votes for the budget and tax, the tax has to match the budget to bring in the revenue that the budget is stated as bringing in. He also cautioned the council to not set a 0 cent tax if they didn’t want a Roll Back Election in the future, which would be a way for citizens to fight a tax increase of 8% or more.
The Council redid their vote and voted unanimously against a new tax. The budget was corrected to show only revenue from non property tax sources which was mostly $50,000 from franchise fees.
Martinez de Vara suggested to the City Council that they should put all funds into the Reserves category and they did so.
$36,000 for Art Martinez de Vara
Mayor Jim Clement was asked by an audience member who created the budget. After pausing, Clement pointed to Art Martinez de Vara and said “Our attorney.”
“The attorney wrote the budget? Why is it that the Attorney’s Fee is $36,000 and yet the Attorney’s Fee in Von Ormy is $12,000? Why’s it 3 times as much?”
Jim Clement answered “I don’t know anything about Von Ormy.”
“He does”, said the audience member pointing to Art Martinez de Vara. “He’s the Mayor of Von Ormy. So you’re saying that we’ve been discussing a budget that the city attorney created that gives him 3 times as much money as the city attorney from another city that he is the Mayor of. Is that correct?
Jim Clement did not reply.
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