City Council Regular Meeting

This ordinance amends the Fiscal Year 2025-2026 Annual Budget to allocate $562,655 from the General Fund balance. These funds are designated for the reimbursement of park maintenance costs to Trinity Falls Municipal Utility District #1 and McKinney Municipal Utility District #2. The amendment is authorized and approved by the City Council, with the ordinance becoming effective upon its adoption on March 17, 2026.

The City Council of McKinney, Texas, is set to adopt its Fiscal Year 2026 Federal Legislative Agenda. This agenda outlines the city's priorities for federal advocacy and aims to guide the Texas Congressional Delegation and other advocates in pursuing issues that impact McKinney residents and businesses.

Key priorities for FY 2026 include:

• Infrastructure Development: Significant focus on projects for McKinney National Airport, including commercial air service development, runway extensions, and taxiway/taxilane improvements. Funding is being sought through various federal programs like TIFIA, FAA grants, and DOT grants.
• Transportation: Continued efforts to secure federal funding for road projects, including a $3,139,500 Railroad Crossing Elimination Grant for the McIntyre Road grade separation, and support for the McKinney Urban Transit District's federal transit funding.
• Water Supply: Ongoing support for the North Texas Municipal Water District's (NTMWD) initiatives with the federal government to ensure future water supplies.
• Public Safety: Seeking continued federal funding for programs such as the Homeland Security Grant Program (State Homeland Security Program and Urban Area Security Initiative), and FEMA's Assistance to Firefighters Grant Program and Staffing for Adequate Fire and Emergency Response Grant Program.
• Community Development: Advocating for continued funding for the Community Development Block Grant (CDBG) Program, which provides resources for housing, public services, infrastructure, and economic development.

The resolution directs city staff to distribute the approved agenda to the federal legislative consultant and take effect immediately upon passage.

The City Council is considering a resolution to authorize the City Manager to execute a change order to the professional services agreement with Terracon Consultants, Inc. for the McKinney National Airport Commercial Terminal Project (AI2250).

Key Details:

• Service Provider: Terracon Consultants, Inc.
• Services: Additional Construction Materials Observation, Engineering and Testing (CMET) services.
• Project: McKinney National Airport Commercial Terminal (MNACT) located at 1508 Industrial Blvd.
• Original Proposal Amount: $64,973.00 for specific services including concrete batch plant quality control, additional concrete beams, and control strip coring.
• Change Order Authorization: The City Manager is authorized to execute a change order, not to exceed $70,973.00, which includes a $6,000.00 owner's contingency.
• Reason for Change: The need for additional CMET services related to the design and construction of the terminal.
• Approval Date: The resolution is set to be passed and approved on March 17, 2026.

The City Council is considering authorizing the City Manager to execute a construction agreement with RNDI Companies, Inc. for the asbestos abatement and demolition of the Old City Hall and Development Services Buildings located at 222 N. Tennessee Street and 220 N. Kentucky Street in downtown McKinney. The total contract amount is $434,237, which includes a $39,000 owner's contingency. RNDI Companies, Inc. was selected based on a proposal that scored highest in the RFP process, particularly in pricing and firm qualifications. The project involves interior and exterior asbestos abatement, selective interior demolition for access, and full exterior demolition of both structures, followed by basement backfill for the City Hall building. The total proposed cost for the City Hall work is $283,022.00, and for the Development Services Building is $112,215.00, with a net total of $395,237.00 before the contingency and salvage value adjustments.

The City Council will consider authorizing the City Manager to execute a contract with Lee Engineering, LLC for professional engineering services. This contract is for the design of traffic signals at two specific locations along Bloomdale Road: Bloomdale Rd @ Community Ave and Bloomdale Rd @ Hardin Blvd. The agreement may also include any necessary supplemental agreements. This action is part of the TR2612 project, as indicated on the provided location map.

This resolution authorizes the City Manager to execute an amendment to the existing professional services contract with Occumed Plus – McKinney, L.P. The amendment, effective March 1, 2026, continues the provision of medical services and supplies for City of McKinney employees and their eligible dependents enrolled in the City's self-funded healthcare benefit plan. The amendment updates several sections of the original agreement dated December 16, 2015:

• Section 2.8 (Other Duties of Contractor): Contractor must verify enrollee eligibility by contacting Cigna Health & Life Insurance Company.
• Section 4.1 (Preferred Provider Arrangement): Occumed Plus will be the City's Preferred Provider, with enrollees paying a City-determined copay for covered services.
• Section 5.2 (Notices): Updates the addresses for official notices between the City and the Contractor.
• Exhibit A (Covered Services): This exhibit is replaced entirely, detailing specific employment and clinical services with associated costs. Notably, employees on the "City Care" or "City Care Plus" plans will have a $0 co-pay, while those on the "HDHP" plan will have a $20 office visit cost. Any new services offered by the Contractor will be considered "Covered Services" upon seven days' notice to the City and mutual agreement on pricing.

This resolution formally adopts the Budget Guidelines for Fiscal Year 2026-27 for the City of McKinney. These guidelines direct city staff in developing the upcoming budget, aligning it with Council goals such as Strategic & Economic Growth, Operational Excellence, and Enhancing Quality of Life. Key directives include:

• Revenue Estimates: Must be detailed, conservative, and realistic, using credible data sources and historical performance.
• General Fund Expenditures: To be proposed as fully funded and balanced, maintaining a conservative tax levy and a General Fund reserve of at least 25% of budgeted expenditures.
• Personnel: Staffing adjustments will follow the 10-Year Financial Plan and performance management data. Police and Fire pay will adhere to Meet and Confer agreements with market adjustments.
• Utility Fund: Focus on long-term sustainability and implementation of rate adjustments based on annual rate studies.
• Economic Development Funds (MEDC/MCDC): Budgets will include roadway development based on estimated sales tax revenue, with year-end adjustments for actual revenue.
• Capital Funds: Support for the Equipment and Facilities Replacement Fund is prioritized. The city will fund depreciation where possible to minimize debt and cash fund infrastructure.

The resolution was passed and approved on March 17, 2026, by the City Council.

This resolution expresses the City of McKinney's support for the City of Melissa to become a member city of the North Texas Municipal Water District (NTMWD) Regional Solid Waste System (RSWS). McKinney has a long-standing relationship with NTMWD, joining in 1951, and became a member of the RSWS in 1993. The City of Melissa, which hosts the 121 Regional Disposal Facility (121 RDF) and has been an NTMWD customer for approximately 40 years, formally requested membership in the RSWS with a proposed effective date of October 1, 2026. NTMWD staff support Melissa's request, recognizing its regional partnership. McKinney's City Council resolution, passed on March 17, 2026, supports Melissa's membership subject to NTMWD's approval processes.

This item concerns administrative and allocation adjustments to the City of McKinney's Fiscal Year 2025-2026 Annual Action Plan and the Fiscal Year 2026-2027 Community Support Grant application scope. Key proposed amendments include:

Annual Action Plan Amendments (FY 2025-2026):

• Financial Reallocations: Reallocating remaining CDBG funds totaling $402,636.00 for eligible uses and $8,417.10 of CDBG-CV funds to the Wellness Center for Older Adults.
• Program Expansion: Expanding the Housing Rehabilitation Program to include subrecipients.
• Community Support Grant (CSG) Amendment: Transferring $40,000 previously awarded to Community Lifeline Center to The Samaritan Inn.
• New Program: Introduction of a Nonprofit Capacity Building program, with up to $75,000 available for leadership development, strategic planning, and other capacity-building activities for one or more non-profits.

These adjustments align with the city's Consolidated Plan (2025-2029) and aim to optimize the use of federal CDBG and HOME funds, as well as local Community Support Grants, to address community needs. Applications for these grants will be accepted from March 3 to April 3, 2026.

This ordinance authorizes the issuance and sale of "City of McKinney, Texas General Obligation Refunding and Improvement Bonds, Series 2026" and delegates authority for their execution. The bonds will fund new public improvements and refund existing debt to achieve savings.

New Money Authorization:
The City will issue up to $75,000,000 in new General Obligation bonds for voter-approved projects from 2019 and 2024 elections, including:

• $9,300,000 for Public Safety
• $27,000,000 for Parks & Recreation
• $38,700,000 for Streets

Refunding Existing Debt:
The ordinance also authorizes refunding up to $5,000,000 of outstanding Series 2014 and 2016 General Obligation bonds, aiming for at least 3.00% net present value debt service savings (estimated over $181,000).

Delegated Authority & Parameters:
The City Manager, Chief Financial Officer, or Director of Financial Services are designated as "Pricing Officers" to execute the bond sales by May 19, 2026, with a closing date of June 17, 2026. Key parameters include a maximum true interest cost of 5.00%, new money maturity by August 15, 2046, and refunding maturity by August 15, 2035. The delegation expires if not exercised within one year of the ordinance's adoption.

Repayment & Compliance:
A continuing direct annual ad valorem tax will be levied on all taxable property to repay the bonds. The City will also adhere to federal tax-exempt status covenants and SEC Rule 15c2-12 for continuing disclosure, including annual financial reporting and timely notification of material events to the MSRB.

This ordinance authorizes the City of McKinney to issue "Waterworks and Sewer System Revenue Refunding and Improvement Bonds, Series 2026" to fund improvements and extensions to the city's Waterworks and Sewer System and to refund existing debt. The City Council has delegated authority to a Pricing Officer (City Manager, Chief Financial Officer, or Director of Financial Services) to finalize the bond sale details within specific parameters, as authorized by Texas Government Code, Chapters 1207 and 1371.

Key Provisions & Financial Details:

• New Money: Up to $28,000,000 (with $25,000,000 planned) will finance water and wastewater infrastructure projects. Examples include University Pump Station Improvements, Redbud Pump Station – Ground Storage Tank No 2, Couch Drive WW Capacity Improvements, Comegys Creek WW Improvements, and Florence St & North St Infrastructure Improvements. The maximum maturity for new money bonds is March 15, 2046.
• Refunding: Up to $8,000,000 (with $7.72 million planned) will refund a portion of the "City of McKinney, Texas, Waterworks and Sewer System Revenue Refunding and Improvement Bonds, Series 2016". This refunding aims for at least 3.00% present value debt service savings (estimated at over $387 thousand / 4.66%). The maximum maturity for refunding bonds is March 15, 2036.
• The maximum true interest cost for the bonds shall not exceed 5.00%.

Funding Mechanism & Security:
These bonds are special obligations of the City, payable solely from the Net Revenues of the Waterworks and Sewer System, constituting a first lien pledge as per Texas Government Code, Chapter 1208. They are not secured by or payable from taxation. The City commits to maintaining rates and charges sufficient to cover operating expenses and debt service.

Bond Ratings & Timeline:
The City's Water Sewer Revenue Bonds currently hold strong ratings: AA+ (Stable Outlook) from Standard & Poor’s and Aa1 from Moody’s. The issuance timeline includes Council Action on parameters on March 17, rating calls on April 16, ratings received by April 27, competitive bond sales on May 19, and closing by June 17.

This item involves a public hearing to consider the annexation of approximately 37.4063 acres of land (Case No. 24-0004A) and a request to zone the property to "MF36" - Multi-Family Residential District (Case No. 24-0104Z). The property is located on the west side of County Road 161, approximately 2,050 feet north of County Road 124 in McKinney, Collin County, Texas.

Key Details:

• Owners/Applicants: QZ Ranch Trust, Bernd Fitzau, Valerie A. Fitzau, Flint Loughridge, Regina Loughridge, and Loughridge Living Trust.
• Current Status: The property is currently outside the City's corporate limits but within its Extraterritorial Jurisdiction (ETJ), with existing land use as single-family residential.
• Proposed Zoning: "MF36" - Multi-Family Residential District, intended to provide a transition and buffer between the future US 380 Bypass/commercial areas to the west and existing single-family residences to the east.

Development Requirements & Agreements:

• The annexation and zoning requests are interdependent: if the MF36 zoning is not approved, the property will not be annexed. If approved, it becomes part of the City and cannot revert to ETJ.
• Infrastructure Responsibility: The property owners are responsible for designing, extending, and constructing all necessary public improvements (utilities, roadways, sidewalks, drainage, etc.) at no cost to the City, in accordance with the City's Unified Development Code (UDC) and McKinney Code.
• Fees: Owners must pay all annexation and development fees, including potential pro-rata fees for off-site water/sewer facilities and proportionality fees (or impact fees if the City's Capital Improvement Plan is updated).
• Parkland Dedication: Owners must comply with parkland dedication requirements, either by dedicating land or paying fees in lieu thereof.
• Waivers: Owners waive certain vested rights and claims against the City related to infrastructure costs and development requirements.

Municipal Services Plan (Effective March 17, 2026):

• Immediate Services: Police, Fire, EMS, Fire Prevention, Solid Waste Collection, Environmental Health, and Code Enforcement will be provided at levels equal to current city services.
• Utilities & Streets: Water, sanitary sewer, and emergency street maintenance will be provided on the effective date, with developers responsible for constructing necessary infrastructure. Routine street maintenance will be scheduled annually.
• Parks & Recreation: Residents will have access to existing facilities immediately. Developers must construct hike/bike trails and meet parkland dedication requirements.
• Other Services: Any other municipal services not specifically listed will be provided within 2.5 years, or 4.5 years if not reasonably feasible within 2.5 years.

Comprehensive Plan Conformance: Staff acknowledges the proposed MF36 zoning does not directly align with the "Suburban Living" placetype designated for the Northridge District where the property is located. However, staff recommends approval, stating it "substantially advances a majority of the decision making criteria" for compatibility, particularly by supporting housing diversity as outlined in the "Diversity (Supporting our Economy and People)" guiding principle.

Timeline: The Planning and Zoning Commission's recommendation will be forwarded to the City Council for final action at the March 17, 2026 meeting. No citizen opposition or support has been reported by staff through the online portal.

This item concerns a public hearing to consider rezoning a property located at 2906 Woodlawn Road from the "AG" - Agriculture District to "I1" - Light Industrial District. The property is approximately 11.112 acres and is currently zoned AG with a mix of single-family residential and vacant uses, with some adjacent industrial use. The rezoning request is intended to bring the site into conformance with neighboring properties and allow for existing developed conditions. The "I1" - Light Industrial zoning designation, as defined in the city's land use comparison table, permits a range of industrial activities including light manufacturing, warehousing, and contractor's yards, among others. This rezoning aligns with the "Oak Hollow District" of the Comprehensive Plan, which designates "Employment Mix" as a character-defining placetype intended for non-residential uses such as office, distribution, and other businesses, benefiting from proximity to major regional highways.