BROADCAST VIA FACEBOOK LIVE SITE: CITY OF HIAWASSEE
OPEN TO PUBLIC
Towns County Senior Center @ 954 North Main St Hiawassee, GA
Monday, October 30th, 2023 6 PM
The City of Hiawassee will hold a Special Called Meeting/Public Hearing to:
1. Discuss and set the Millage rate for 2024 taxes
2. Discuss and approve the UCBI Term Sheet/IGA for the Paris Business Center Following the Special Called Meeting/Public Hearing,
The City will hold the October Work Session HIAWASSEE CITY COUNCIL
WORK SESSION AGENDA
1. Call to order
1.1 Invocation – Nancy Noblet
1.2 Pledge of Allegiance
1.3 Mayor’s Introductions of Guests and Announcements
1.4 Approve the Agenda as distributed
2. Old Business
2.1 Mayors Report
2.2 Feather Flag Ordinance discussion
3. Consent Agenda:
3.1 Minutes from October 3rd, 2023 City Council Meeting
3.2 Minutes from Work Session October 30th, 2023
3.3 June Financials
4. 2024 Calendar
5. Air Care Med Contract renewal for 2024, same price $5390.00
6. Alcohol License approval for: - Hiawassee Package Store Hiawassee Food Mart (Texaco) Monte Alban - Ingles iMarket Ingles Hiawassee Fuels LLC (Valero)
7. Police Report
8. Economic Development Report
9. Executive Session
10. Adjournment
Monday, October 30th, 2023 6 PM
Monday, October 30th, 2023 6 PM Minutes
The City of Hiawassee held a public hearing on Monday October 30, 2023 to hear citizen input on the Millage rate for 2023 taxes and the UCBI Term Sheet/IGA for the Paris Business Center. Because the Public Hearing for the Millage rate was advertised to be held at City Hall and the meeting was moved to the Senior Center at 954 North Main Street, Hiawassee, GA due to the expected attendance related to the UCBI Term Sheet and IGA for the Paris Business Center, the meeting was postponed to 6:10. A police office was stationed at City Hall to direct any attendees who arrived there to the Senior Center.
The public hearing was called to order at 6:10 p.m. by Mayor Liz Ordiales. Present in addition to the Mayor were Council members Amy Barrett, Jay Chastain, Anne Mitchell, Nancy Noblet and Patsy Owens. Staff present were Economic Development Director Denise McKay, Downtown Development Manager Steve Harper, Police Chief Jeremy Parker, Officers William Conway and Jose Carvajal, and City Clerk Bonnie Kendrick. City Attorney Thomas Mitchell was also in attendance.
The invocation was given by Council member Nancy Noblet and was followed by the Pledge of Allegiance.
Council member Jay Chastain requested that the agenda be amended to add the City Attorney to speak regarding the Paris Buildings.
Motion to approve the agenda as amended was made by Council member Nancy Noblet, seconded by Council member Jay Chastain with all in favor.
Mayor Ordiales is recommending that the Council take the roll-back millage rate which will drop the millage rate from 1.972 to 1.809. Larry Sorgen asked why, and Mayor Ordiales explained that the millage rate was lowered because property valuation was increasing. It lowers the millage rate to keep the property tax income relatively the same each year. There was no other discussion regarding the millage rate. Motion to approve the roll back millage rate to 1.809 was made by Council member Amy Barrett, seconded by Council member Jay Chastain, also in favor were Council members Patsy Owens and Nancy Noblet. Opposed to the motion was Council member Anne Mitchell. Mayor Ordiales advised the Council and citizens that it will be 2- 3 weeks to get the bills out in the mail because of the process that is required to get it to our bill processor. There will be 60 days between the mailing date and the due date for the bills which will make them due sometime in February.
The meeting moved to the topic of the Paris Business Center loan. Mayor Ordiales gave the background on the strategic plan that was completed in 2018. Out of the 6 priority areas, (Quality of Life, Community Identity, Historic Town Center Revitalization, Town Square, Economic & Workforce Development and Transportation) the focus has been on the Downtown Center revitalization and Economic and Workforce Development. The purchase and renovation of the Paris Buildings supported these goals by preserving the oldest buildings in downtown Hiawassee and using them to accomplish the economic and workforce development by developing a business incubator.
While the City received a grant to replace the roof on both buildings but, once work commenced, it was discovered that replacing the roof on either building would likely cause it to collapse the buildings. Because it was being funded by a grant, the DDA requested approval to use the funds to stabilize the building and the roof on each building was covered with a tarp to keep water from further damaging the buildings. An application for an ARC grant in the amount of $600,000 to renovate the building was submitted in February 2021 and received approval in November 2021. Interior demolition, land surveys and environmental studies all needed to be completed before reconstruction could begin. Original designs included one roof top dining area, however undercover dining and additional outdoor seating was added in April 2023.
Elimination of the 2nd story will cost $1.1Million, cost $1.7Million with the second story. 55% of SPLOST is dedicated to economic development. We receive approximately $30K/month through SPLOST receipts. The other 45% is shared between Public Safety, Parks and Recreation, and Roads, Streets, and Bridges. Skyrocketing costs because of COVID-19 included significant cost increases as well as supply chain issues.
Rob Sollie and Eric Champlin, owners of Trailful Outdoors, addressed the Council with their concerns regarding the Paris Business Center renovations. Eric detailed their personal and company history and contributions to the City and the surrounding area. Eric then described the issues that have affected their building since the renovations began on the Paris buildings. Significant water damage resulted from the building roofs being covered in tarps causing water to collect in the crawl space of the building – previously this was falling into the Paris buildings. They have not asked for any remuneration from the City understanding that once the buildings were completed the water issue would have been addressed. They were given the option to purchase their building in June 2023 and told if they did not that the building, it would be sold. Not wanting to uproot their business, they started the process of procuring a loan. The building inspection required by the purchasing process uncovered grave issues with the building – some related to the water now funneling into their crawlspace. The property manager for their building owner, Paul Scherer, who is also a member of the Hiawassee Planning Committee, recently informed them that the project is nearly out of money and that the Council majority will vote against the loan to complete the Paris Buildings renovations. The loan is set to close in a few weeks and Rob and Eric are looking for assurance from the City that the issues will be addressed. Water management issues can be addressed for approximately $10,000.00.
Vicki Constantinides also spoke regarding the history of the Paris Building from purchase in 2019 through recent meeting where Mayor Ordiales and Economic Development Director Denise McKay suggested use of SPLOST funds to close the gap. While she feels that the precepts of the City ordinances were not followed to the letter of the law, but no one in authority questioned what was going on with the buildings. All must take some responsibility. She asked the Council to please vote to finish the building and to leave the citizens with something useful.
As requested by Council, City Attorney Thomas Mitchell stated that the agenda item is to discussion and approval of the UCBI Term Sheet and intergovernmental Agreement between the City of Hiawassee and the City of Hiawassee Downtown Development Authority. He stated that in the last few weeks, it was learned that the Mayor had executed an amendment to the construction contract on the Paris Business Center in June that expanded the project and authorized expenditure of an additional $1.2Million without Council approval. DDA approval for the project expansion was voted for in April, but it was not approved by Council. Because the City owns the property, and the project is for building on the property, the Council must approve those actions. The Mayor should have been aware of these requirements. The expansion lead, in large measure, to the need for the loan for which the Intergovernmental agreement with the DDA is required. The loan documents – there are several of them – are in draft form and have not been executed. However, the contractor has performed some of that work although the funding source and the contract had not been approved. Attorney Mitchell detailed the expenditures on the Paris Business Center project and described 4 scenarios that the Council needed to choose from and the ramifications of each. They included completing the project with the second story seating area, without the second story seating area, a “bare bones” completion and not completing the project at all. To date $830,765.94 has been paid – cost to complete as proposed with second story-$1,727,417.00, cost to complete without second story-$1,358,031.00, cost to complete “bare bones” as required by the grant-$1,200,000.00 as evidenced by conversations over the weekend with the contractor. Cost to terminate the project would be $821,970.99. The building would not be complete, but with whatever stabilization is necessary, and terminating the project would likely disqualify the City from receiving grants in the foreseeable future and this does not take into account the donations made. In addition, it was also learned that Bradshaw Lane, which is the street the Mayor lives on, was paved without approval of Council using LMIG and SPLOST funds without Council approval. As a result of these Council members Jay Chastain, Nancy Noblet and Amy Barrett have requested an investigation pursuant to section 2.15 of the City of Hiawassee Charter which states “The city council may make inquiries and investigations into the affairs of the city and the conduct of any department, office, or agency thereof and, for this purpose, may subpoena witnesses, administer oaths, take testimony, and require the production of evidence. Any person who fails or refuses to obey a lawful order issued in the exercise of these powers by the city council shall be punished as provided by ordinance”. Based on the Mayor exceeding authority with regard to City funds and property, they have also inquired into the possible steps to remove the Mayor. While Section 5.15 provides for removal from office for specified reasons, it is his opinion that this does not meet the requirements of due process required by the Georgia Supreme Court in the case entitled the City of Ludowici vs Stapleton. Councilmembers Chastain, Barrett, and Noblet each requested that Attorney Mitchell discuss with the Mayor whether she would resign. Attorney Mitchell stated that he spoke with the Mayor late Sunday afternoon and said she advised him she is not prepared to resignation at this time, but understands that the Council members need full investigation and that an investigation will likely occur. His role as the City Attorney does not allow his involvement in the investigation much beyond advising the Council members as the Council’s charter authority to initiate it, as he has done and his interpretation of Section 5.15 above.
Attorney Mitchell has advised Councilmembers Chastain, Barrett, and Noblet that the City Council would need to hire separate counsel and that attorney may have different opinions on these matters. The investigation provided for in Section 2.15 may require a hearing officer as well. Likewise, the Mayor may retain counsel as well should she choose to do so. With regard to the actual agenda issue, Attorney Mitchell stated the term sheet will need to be approved if the Council decides to go through with the loan and he would appreciate some direction from the Council regarding which way they were leaning because he and the bank’s attorney need to get the documents completed before the end of the week so that Council will have time to review prior to the meeting on Tuesday next week. In addition, should the Council determine to proceed, Attorney Mitchell will need the contractor to provide an amendment to the contract taking into account all the work the Council directs to be done, which is to complete as purposed, - with rooftop, complete without rooftop, or do as he characterizes the barebones – there is about $160,000.00 between those last two things - or begin the process to terminate the contract. Attorney Mitchell asked if the Council had any questions.
Council member Jay Chastain stated he wanted to know what happened and what else has happened. He feels he is sworn to protect the City and the tax payers.
Council member Nancy Noblet stated she wanted to do what was right for the City and to fix the issue for Eric and Rob (Trailful Outdoors owners) and she didn’t want to see another business go out of business. She also stated that the main topic at the recent joint retreat between the City and the DDA was transparency and wanted the investigation to find what was hidden. She wants all to stand together for what is right for the city.
Council member Amy Barrett stated the building changes over the course of the project were not approved by Council including grading work, increasing the size of the kitchen as well as the second roof top dining area.
Mayor Liz stated that an investigation is in order and stated that she had sent text messages to meet with any Council member any time to explain anything (must be one on one because of quorums) and no one responded to the texts except Council member Patsy Owens and Anne Mitchell. She also stated Council was updated be either herself or Economic Development Director Denise McKay on the status of the buildings.
Attorney Mitchell asked for direction from Council regarding the Paris Building project stating a forensic audit as had been suggested, would likely take months to complete and a decision needed to be made regarding the 4 options previously stated. Several Council members stated they felt “backed into a corner” regarding the building. Ultimately, the Council authorized Attorney Mitchell to contact the bank’s attorney to create the documents for the loan to complete the “barebones” completion of the Paris Buildings ($1.2 Million loan) for review and consideration at the Council meeting next week. He will also contact John Sheahan of Storm Construction to revise the contract for the work to be completed.
Janet Oliva asked Attorney Mitchell to clarify the separate counsel and how that would work. Attorney Mitchell stated that the Council would need to hire an independent counsel. She wondered if a financial consultant might be a better fit for the situation.
Mayor Ordiales reiterated that the money for the Paris project was to come from SPLOST funds not from property taxes. SPLOST funds are generated when anyone makes a purchase whether they live here or are visiting.
Mickey McGee stated he felt there was a conflict of interest with a member of the Council who may or may not be influenced by virtual of their work associations. The Mayor stated she felt that all would be exposed in the investigation.
Josh Alexander asked who would be paying if the Council hired independent counsel. Attorney Mitchell stated the City would pay for that expense.
Paul Scherer offered statistics from the restaurant industry on the number of restaurants that fail in the first year of business and asked if that was being taken into account in this situation and stated that no one in the room knows who this restaurant business is and is concerned about the secrecy surrounding this restaurant ownership. All that is being provided is a “white box” and the restaurant will be responsible for build out of the restaurant (appliances, etc). It was stated that the restaurant had requested their name not be revealed at this time and due to client privacy, the name has not yet been revealed. Mr. Scherer asked why they needed the roof top dining area. Mayor Liz stated it was approved by the DDA. Downtown Development Manager Steve Harper stated that the DDA did not want the roof top dining area that it was forced on the DDA by the Mayor. It was also stated that Mr. Harper’s and Economic Development Director Denise McKay’s jobs were threatened if it was not included.
Mickey McGee stated that any time an elected official has a potential conflict of interest it should be disclosed. The Mayor stated that the road list is devised with input for the City employees who drive the roads and she offered to share the list which also included Council member Noblet’s street. Street sign naming was also brought up as an issue.
Council member Nancy Noblet stated she was not in favor of the loans and in fact was not in favor of purchase and renovation of building because of the deterioration that occurs over the number of years the buildings were vacant, but she did not want to lose grants because the City needs them. She stated that she was at the DDA meeting in September and the Mayor had told the DDA at that time, that she had told them 6 months ago to do something about loan or they would be in this situation. She also stated that she had heard several DDA members were being bullied by the Mayor. She asked that all agree to disagree and move on with the meeting.
The meeting then moved onto the Work Session.
In Old Business the Mayor presented her report, which included updates on the alcohol license renewals for 2024, business license renewals, and property taxes (bills will be sent out in November). The water rates and the rate comparison dashboard as well as rates in surrounding areas were presented. Mayor Ordiales explained that the water bills are calculated based on a base rate of 1200 gallons (minimum bill $26.13 for Water only) and an additional charge of $7.10 per 1000 gallons after the 1200 gallons. Ms. Oliva stated she had received many complaints from friends and neighbors about the increased water rates and the Mayor asked her to refer them to City Hall where she would explain their bills in the same manner. Larry Sorgen asked about commercial vs residential rates. Council member Jay Chastain said that when he was first elected to the City Council in 2002 it was that way Other topics were the water main break on Main Street at River Street and associated costs, Daughters of the American Revolutions provided the City with a proclamation for the preservation of the Unicoi Parkway, the Berrong-Oakley House Christmas decoration fund raiser ($25.00), donations to the Berrong-Oakley house are now over $33,000.00, Halloween will be held at the Georgia Mountain Fairgrounds tomorrow evening (October 31st) from 5-9pm.
Also, in Old Business the Feather Flag Ordinance will be on the agenda for its second reading.
In New Business, the Consent agenda will consist of the minutes from October 3rd, 2023, City Council Meeting, minutes from October 30th, 2023, Work Session and the June financials.
The draft 2024 Calendar was presented and will be on the agenda for approval next week. Changes to the normal dates include moving the January meeting to January 9th instead of January 2nd and setting the May Work Session to Tuesday May 28th due to the Memorial Day holiday.
The Air MedCare Contract renewal for 2024 is the same price as last year ($5390.00). This will be on the agenda next week for approval.
Alcohol License applications have been received for Hiawassee Package Store, Hiawassee Food Mart (Texaco), Monte Alban, Ingles iMarket, Ingles, Hiawassee Fuels LLC (Valero), Hiawassee Brew, Bacchus on the Lake, Tilted Café and Tilted Bottle. These will be on the agenda for approval next week. Deadline for applications to be received is tomorrow (October 31st).
In the Police Report, Chief Jeremy Parker said it had been a busy month. The Trunk or Treat event for First Responders went well on Saturday and the department is working on an active shooter drill.
In the Economic Development Report, Director Denise McKay reported that the GICH project in Young Harris has been given approval. Apartments are projected to be available in 2025.
There being no need for an executive session, the motion to adjourn the meeting was made by Council member Amy Barrett, seconded by Council member Jay Chastain with all in favor. Meeting adjourned at 7:46pm