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2012-10-04

New EDC directors appointed, Corp's 501(c)3 status questioned

By Judith Pannebaker BCC Editor

A special meeting of Bandera City Council took place on Tuesday, Sept. 25. At that time, councilmen approved the budget and tax rate for fiscal year 2012-2013, as well as approved new members to serve the Economic Development Corporation (EDC) and the Planning and Zoning Commission.

At the onset of the meeting Mayor Pro Tem Maggie Schumacher informed those attending that comments would only be allowed during the "Visitors to be Heard" agenda item. The only person who signed up to speak was Nell Clark, wife of mayoral candidate Don Clark.

During the "Visitors to be Heard" section, Nell Clark delivered a vicious personal attack, maligning the reputations not only of Schumacher, but also of two unidentified "ladies," who currently serve on the council, as well as a woman who is a declared candidate for a seat on city council and was recommended for a place on EDC.

Personal attacks

In her prepared statement, Clark thanked "most" of the EDC members and officers for their "hard work and devotion to the city and citizens." She then accused Schumacher of having her "own personal agenda" by removing current EDC members and replacing them with her own "handpicked people."

After describing "two ladies on the council" as not being "independent thinkers," Clark asked, "What is the rush (to replace EDC directors)? Most of them will be getting off in December. Do you have a small window of opportunity before the election? Are you selling yourself short?"

Clark went on to accuse Schumacher of having "a personal vendetta."

Clark also referenced a motion made by Councilman John Hegemier at the last council meeting and seconded by Councilman Brandi Morgan to table the replacement of EDC members until December because, as Hegemier noted, "We might have a new mayor and city council."

"Two weeks later, it's back and you're trying to get your way again," Clark said. "This is no way to run a city. You're a very controlling person, who needs power, Maggie."

No personal opinions

In an interview, municipal attorney Jason D. King of Akers & Boulware-Wells, LLP, said the purpose of the allowing citizens' comment at the front of meetings was to receive comments from the public related to items of public interest occurring in the city. It was not to be used as a venue for attack.

"Some municipalities have even added a disclaimer beside the agenda item stating the inappropriateness of venting personal or other opinions," King said.

In fact, harangues similar to that delivered by Clark have led to the removal of "Citizens' Comment" item from agendas of the Bandera County River Authority and Groundwater District. According to a spokesman, continued personal attacks and political statements led to contentious and non-productive meetings.

BCRAGD General Manager David Mauk noted, however, "We allow members of the audience to speak on specific agenda items."

King opined that it would be "perfectly legal" for the city to remove the "Citizens to be Heard" item from future agendas. "The Open Meetings Act is used for disclosing governmental functions 'in the light of day'," he explained. "The Open Meetings Act does not require public participation. That takes place in public hearings."

King continued, "Meetings in Bandera are always relatively lively, but I never expected anything like that."
Later that week, for some reason, Don Clark reportedly apologized to City Administrator Mike Cardenas for his wife's remarks, purportedly saying, "I had no idea what she was going to say."

After learning about Clark's ostensible "apology," one perennial city-watching wit remarked, "If Don can't 'control' his own wife, should he get elected mayor, how does he intend to 'control' all those women on city council?"

Hail Mary plays

And, despite several Hail Mary plays launched by Hegemier and seconded by Morgan, EDC directors who had served far longer than legally allowed were removed by a 3-2 decision with Councilmen Nancy Montgomery and Binky Archer and Schumacher casting affirmative votes.

As King explained, "The legal issues are straightforward. No (EDC) director can serve more than six years and apparently several have. According to state statutes, city council has the right to appoint or remove directors at any time for any reason."

For the record, longtime EDC directors included Don Clark, who had served 15 years: Joe Hearn, 13 years; Vonia Dyer, 11 years; and Linda James, eight years. Prior to his resignation as EDC president in May, former Mayor Horst Pallaske had also served 15 years.

"I really don't care what anyone thinks is behind the replacement of these long-serving EDC members. The plain fact is we're trying to make everything legal," Schumacher said. "Now that we know they have been serving illegally, according to state statutes that govern the economic development corporations, we have a legal right and obligation to correct the situation."

New EDC directors include city residents, Tony Battle, Joe Davis, Carolyn B. Edwards and Esther Maldonado and business owner, Johnny Boyle, who resides in the county.

According to Schumacher, all new directors will have an opportunity to attend a training session to learn about their new responsibilities and duties. Also, personnel from Austin who oversee local EDCs will be available for additional training at a later date.

Clearly pleased with the outcome, Archer said, "The city council had the same reaction from people when we were dealing with the police department. Now the city marshal system is in place and look how well everything has turned out. Finally, this city is moving forward at last."

What 501(c)3 status?

In a related issue, the Bandera County Courier has sent an open records request to the City of Bandera, requesting evidence of the local EDC's current 501(c)3 status, in addition to copies of EDC tax returns filed with the Internal Revenue Service.

In the past, both Don Clark and Hearn have referenced the corporation's 501(c)3 status. However, the City of Bandera Economic Development Corporation is not listed on the website of Comptroller Susan Combs as being a 501(c) organization.

Information on

www.texasahead.org/tax_programs/typeab/,

seems to define Bandera's EDC as a Type B EDC, which can underwrite all Type A projects, i.e., the development of industries, in addition to funding quality of life improvements, such as parks, museums, sports facilities and even affordable housing. However, Type B EDCs are subject to more administrative restrictions than Type A.

Type B corporations may pay for land, buildings, equipment, facilities, targeted infrastructure and improvements for:

• Professional and amateur sports and athletic facilities, tourism and entertainment facilities, convention facilities and public parks;

• Related store, restaurant, concession, parking and transportation facilities;

• Related street, water and sewer facilities; and affordable housing.

To promote and develop new and expanded business enterprises that create or retain primary jobs, a Type B EDC may fund:

• Public safety facilities;

• Recycling facilities;

• Streets, roads, drainage and related improvements;

• Demolition of existing structures;

• General municipally owned improvements; and maintenance and operating costs associated with projects.

Type B EDCs also may seek voter approval to spend Type B sales tax funds for a water supply, water conservation program or to clean up contaminated property.

Additionally, Type B EDCs created by cities with a population of 20,000 or less may use sales tax proceeds to fund projects that promote new or expanded business development that do not create or retain primary jobs.

Council also unanimously approved with alacrity an EDC administrative expenditure for $3,500 for Christmas lights requested by Genie Strickland on behalf of the Bandera Business Association.