City Goes After Railway Museum President David Wood

Anyone who has attended San Angelo's Railway Museum knows the critical role Board President David Wood has played in that operation.  His tours reveal his deep knowledge of San Angelo's rail history and the extent of his personal commitment to the operation as many exhibits are personally owned by Wood.

The railway museum is in the historic Santa Fe Depot and the nonprofit railway museum has operated there for over twenty years.  It's been an all volunteer operation.  The City no longer trusts the museum's number one volunteer who has challenged the city for not meeting its maintenance obligations under the lease.

Oddly, the city gave its auditorium to the San Angelo Performing Arts Council (SAPAC).  It provided $6.2 million in funding and another $1 million in historic tax credits.  The City gave SAPAC years to meet its fundraising goals before forking over millions in direct taxpayer subsidies.  Why the dramatic contrast in support?

City Council will need to explain why it fell over backwards for SAPAC while knocking the railway museum off the rails.  Both nonprofits enrich the community.  Both bring "heads to beds," tourists to town so they can rent hotels and buy meals.

Back in May San Angelo Live reported:

Wood and his board of directors are concerned that the city may be making a move to evict the 20-year-old museum of railroad history for a corporate suitor. 

City Council took the first step toward eviction with its action not to renew the lease.

What happens next with the old depot is up in the air. Rumors are that the City is interested in leasing or selling the old depot to a private company, such as Texas Pacifico, who runs a real railroad operation here. Spokeswoman for Texas Pacifico Liz Grindstaff said her company currently has a lease on their existing location and any speculation about leasing the depot is premature.

City Manager Daniel Valenzuela should recall the pain former Assistant City Manager Liz Grindstaff caused him with her role in the Furniture Fiasco, the unauthorized purchase of over $100,000 in Water Department furniture.  That debacle occurred in Valenzuela's first City Council meeting.

Grindstaff coordinated City Hall renovations, which originally excluded the city auditorium as it was in "good condition."   She left the city to join Texas Pacifico Railroad, which city staff recommended helping with a nearly $250,000 economic development incentive.  After City Councilman Winkie Wardlaw opposed the incentive Liz Grindstaff ran for his seat and won.

City Manager Daniel Valenzuela's investigation into the unauthorized furniture purchase hardly met the standard of competency.  It failed to answer the most basic questions and is unsigned and undated.  Yet yesterday Valenzuela had his attorney ignore the city's log like failures while pointing out the stick in David Wood's eye.

Time will reveal the city's true intentions. The Railway Museum Board must try to read the tea leaves.  If the city is intent on making money from real estate tossing David Wood off the board would make no difference.  It would be sad if the city's opaque approach splintered an all volunteer group with a noble mission.

It's incumbent on City Council to make their intentions clear.   The public can infer the city wants David Wood gone.  The question is do they want the whole operation out as well?

The Railway Museum does not have the city's PR resources which have already been unleashed in surprise attack fashion.  It does have over twenty years of goodwill in the community it can mobilize.  Will David beat Goliath?

Update 9-6-17:  A splintered railway museum board gave city staff the fodder it needed to not renew the lease.  So far all the communication has been from the anti-David Wood camp.  Goliath drove David out.  He resigned last night from the museum board so the organization has a chance to renew the lease.  It has an uphill climb to convince City Council the organization has revamped.

Update 9-19-17:  The City gave a decimated Museum board six months to get its act together after the city ran roughshod over the Museum's volunteer leaders.

Update 3-6-18:  City Council approved a lease extension for the Railway Museum through 6-15-2018.  

City Council Booted Railway Museum and Deliberated Budget Public Hearing Behind Closed Doors

San Angelo's City Council looked secretive and unwilling to share the most basic deliberations in today's meeting.  The Executive Session agenda had two items where Council took action but shared no information.  The first involved real property at 703 S. Chadbourne..

b. Section 551.072 Deliberations about Real Property regarding 703 S. Chadbourne 

c. Section 551.071(2) consultation with attorney regarding 703 S. Chadbourne 

Council returned to public session and voted not to renew the lease at 703 S. Chadbourne.  The City  never identified the current occupant in the agenda or council discussion.  That is not honesty or transparency.

Railway Museum Board President David Wood heard about the move and cancelled two doctor appointments to attend.  His testimony informed the public watching live, not City Council or staff.  Wood offered public comment expressing his dismay at the turn of events.  When asked why, i.e. what were council's deliberations, Wood was told that information was under attorney-client privilege.

City Council hid behind attorney client privilege only to have staff produce a slick, scripted press release on the matter.  The press release quoted the same City Attorney who told Mr. Wood the reasons were confidential.  She did not hesitate to share information on Council's decision via news release.

City Council is the accountable body and it should not hide behind attorney-client privilege.  It should not delegate its responsibility to inform the public to a press release.  City Council held deliberations and took a vote in a public meeting.  They need to state the reasons for their action, which cancelled the Railway Museum's lease ten days before it is due to expire.

Oddly, staff moved the mandatory public hearing on the 2017-2018 budget to executive session from the public agenda.  The following item was moved after a nearly two minute silence. 

e.  Discussion and consideration of matters related to the fiscal year 2017‐2018 operating budget including:

1. First public hearing and introduction of an ordinance of the City of San Angelo approving and adopting the budget for the fiscal year beginning October 1, 2017, and ending September 30, 2018. This budget will raise more total property taxes than last year’s budget by $1,540,425 (4.29%), and of that amount, $635,425 is tax revenue to be raised from new property added to the tax roll this year.

2. Conduct a separate record vote to ratify the property tax revenue increase reflected in the budget and place the adoption of this tax rate on the agenda for the September 5, 2017 regular meeting of the City Council as an action item. (T. Dierschke)

It's hard to vote and put the item on the agenda for September 5th when it is September 5th.  The shift to executive session was likely a procedural move due to poor planning.   However, it would be interesting to hear deliberations from Council on an item intended for the public to hear and make comments.  Citizens did not get that opportunity.

Mayor Brenda Gunther and City Council looked off step on the budget item and mean spirited on the Railway Museum.  They serve the public and should not hide behind staff.  Deliberations, even procedural ones, should be shared. 

Parts Budget Up $200,000, Contract Renewal Nears

San Angelo's City Council will take up a $200,000 increase in repair parts when they return from the Labor Day holiday.  This is significant as the City contracted out its parts department three years ago.  At the time it promised City Council a financial impact analysis.  That never came and when asked the city could not produce one.  It simply referred to vendor's pricing structure and a contract that had the City of Odessa as an example.

The parts department contract is up for renewal as it expires on 9-26-17.  Now would be the time for this City Council to hear the financial impact of contracting out the parts department for the last three years.   They learned of the arrangement August 8th in a Budget Workshop meeting.

This City Council has no members that approved the concept in May 2014.  There has been 100% turnover in elected leadership.  A financial impact presentation would ensure an informed renewal and that council remains complaint with purchasing ordinances.  It may not be required within the letter of the law, but ethically, the spirit requires it.

Update 9-5-17:  There were no deliberations on this item as it was on the consent agenda and no member of City Council pulled it for discussion.  In their August 15th meeting no member of City Council wanted to know why the cost for repair parts increased $200,000 for the current fiscal year.  That held for September 5th.  

Update 9-15-17:  City Council will not take up contract renewal for vehicle parts department operation in their 9-19 meeting.  The city produced no additional financial information.  I wrote my City Council representative with my concerns but am yet to receive a response.

No Financial Impact Exists on Parts Department Outsourcing

San Angelo's City Council approved contracting out its vehicle parts department in May 2014.  The consent agenda item had no presentation and was supported by a two page memo that said:

The financial impact will be finalized through the negotiation process.

That financial impact is nowhere to be found. When asked to produce the promised financial analysis city staff sent a copy of the signed contract.

The information requested is in "Section 7" of the contract, per the department. 

Section 7 is simply the pricing plan summary shown above. Assessing financial impact is Assistant City Manager/CFO Michael Dane's territory, not the Parts Department.  No credible financial officer would consider a vendor's pricing structure a financial impact analysis.  However, that is the city's position.

Oddly, Council's shadowy decision occurred in the midst of the city's rush to renew its trash contract with Republic Services. The Vehicle Maintenance Fleet Parts and Supply Management RFP was due April 9, 2014.  City staff opened trash bids the end of March only to learn Republic had over-billed commercial customers for over a decade.  That fact did not deter staff or council from their headlong rush to renew. 

With the public upset over the trash situation I'm sure city officials were relieved that no one raised the most basic questions regarding contracting out parts.

City Council remained out of the loop on the Parts Department until a recent strategic planning session.  As the contract is up for renewal now would be the time for city staff to show a three year financial impact analysis.  That the promised information does not exist should be concerning to city council and citizens wanting effective local governance.

Operations Director Shane Kelton is over both trash and vehicle maintenance.  City Manager Daniel Valenzuela signed both agreements.  Mr. Valenzuela is not known for his investigative abilities.   His investigative reports are light to the point they've been unsigned and undated.  These facts might explain why no financial impact exists in City Hall.

Sales Tax Budget Varies Widely in Two Weeks

San Angelo's City Council heard two sales tax stories in recent budget sessions.  On August 22nd staff proposed a 3% sales tax increase over current budget for the city's general fund.  On August 8th staff proposed a large decrease in sales tax revenues for economic development.

So which is it, a projected 3% increase or a large decrease?  It cannot be both.  Sales tax revenue for the development corporation and general fund are directly correlated.

Using the general fund assumption of $17 million in sales tax revenue for the coming year the Development Corporation would have $8.5 million.  That's $650,000 more than budgeted.

There's a disconnect between 2017-18 sales tax projections in staff budget presentations.  City Council and the public deserve a consistent story from staff.

Update 9-23-17:  The COSADC Board background packet for 9-27-17 shows over $8 million in sales tax revenue with one month left in the fiscal year.  The development corporation will end the year with sales tax roughly equal to last year, i.e. no decline.  The city believes it will rise 3%.  So why the $800,000 sand bagging?  Is it to fund the Sunken Gardens park, also on the September agenda?  The Railway Museum might have serious regret for not shopping around for a new home.

Update 11-5-17:  Finance Director Tina Dierschke told the Development Corporation Board that sales tax revenues had been up the last four months in a row .

Update 11-19-17:  Sales tax revenue is up nearly $300,000 or 11% from last year.  That's the story City Council will hear on 11-21-17.

Update 2-2-18:  The Development Corp decided to adjust sales tax revenue up to coincide what the city budgeted.  Sandbag removed!

Update 3-18-18:   Sales tax revenue is "over budget for revenue by $822,919 year to date."  That's from the city's higher number, not COSADC's lowball budget.  City Council will hear the report on March 20th.

Update 11-3-18:  Finance Director Tina Dierschke admitted sales tax came in much higher than budget for the closed fiscal year.  Staff never addressed the discrepancy between the city and the Development Corp's sales tax revenue projections. 

Murky Vehicle Maintenance Contract to Renew in September

Nearly three years after the City of San Angelo contracted out its vehicle parts department City Council heard information about the arrangement.

In May 2014 City Council approved negotiating with NAPA-Barron Services for vehicle parts and supply management.  The item had no discussion and passed in the consent agenda upon motion by Don Vardeman and seconded by Charlotte Farmer.

The background packet stated:

"The financial impact will be finalized through the negotiation process."

I requested this information after hearing Operations Director Shane Kelton describe the arrangement.  The city could not produce any documents showing the promised financial impact of this arrangement.  It did produce a contract which differed from details shared by Kelton.

"That management fee is set.... about $40,000."

The contract calls for NAPA Barron to be paid in two ways:

A search of the city's website produced amounts paid to NAPA for a six month period.  There appears to be two checks per month and over the half year period the city paid NAPA nearly $500,000.

Hopefully City Council will get the promised financial impact before the contract is renewed.  The initial three year period is up on September 26, 2017. 

Water Board Gets Partially Consulted

San Angelo's Water Advisory Board heard a consultant's presentation on the Water Utility Master Plan (at a maximum cost of just under $315,000) before considering the hiring of another consultant for a Water Supply Engineering Feasibility Study (at a maximum cost of just under $575,000).  During the second presentation Water Chief Bill Riley showed a slide titled "Current Water Supplies."

The city's current surface water supplies are ample.

Lake Nasworthy - 8,069 acre feet
O.C. Fisher - 15,164 acre feet
O.H. Ivie - 120,056 acre feet
Twin Buttes - 22,070 acre feet
E.V. Spence - 72,508 acre feet
                      (source: Water Data for Texas)

Those sources currently hold 237,000 acre feet.  Mr. Riley's slide showing a mere 13,820 acre feet would be way off on any truth meter.  His slide would be better titled "Estimated Safe Yield" for water planning purposes.  The Water Advisory Board needs to plan for lots of non-rainy days.   It has a super conservative number to use going forward.

Board member Kendall Hirschfeld recalls our serious water predicament as a City Council member.  He understands the need for finding more water sources for our community, as does the state of Texas.

The 2017 Texas State Water Plan has the following projects listed for San Angelo:

Direct and/or indirect reuse for municipal use - $150,000,000  (year 2020)
Hickory Wellfield expansion in McCulloch County - $27,104,000  (year 2020)
West Texas Water Partnership - $39,175,200  (year 2030)
Desalination of other aquifer supplies in Tom Green County - $57,967,000 (year 2050)

Hirschfeld expressed his concerns about Water Board members being out of the information loop on critical development projects.  Our water board cannot hear updates on the West Texas Water Partnership and its possible $40 million price tag.  Updates on the Hickory Wellfied expansion are not allowed as the city may be suing Alsay and Carollo Engineering for their work on six additional Hickory wells which should have been completed in 2016.   It's hard for a board to do its work with incomplete information.

Planning not to run out of water is hard work and expensive.  It must also be irritating for citizens volunteering their time and expertise to be out of the loop on major projects, regardless of how good the reasons.