Board of Directors Regular Meeting Agenda


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Meeting Date: 04/18/2019  

SUBJECT MATTER:
Receive, consider and act upon a discussion regarding a request to The Woodlands Land and Development Company for Access Fee information (as requested by Director McMullan);
FISCAL IMPACT:
N/A
BACKGROUND:
Director McMullan requested an agenda item to discuss “access fees” that may or may not be collected by The Woodlands Land Development Company through utility access agreements. This matter was requested for the April 18 Board meeting.
 
The Township is currently conducting an incorporation study and has requested information from the Development Company regarding the access fees collected and the agreements that may currently exist to assist with determining the net impact (on a Woodlands resident) if franchise fees were implemented by the new city at time of incorporation.
 
In The Woodlands, the fee that appears on some utility bills is not a “franchise fee”; it is a “utility access fee”. The Woodlands Township does not have the authority to charge franchise fees; the community associations also had no authority over these fees. The Covenants give The Woodlands Development Company the authority to reserve utility easements. The right to enter into "access agreements" with utilities is a right originally given to the Developer through the New Community Program and approved by the Department of Housing and Urban Development (HUD). Historically, these utility access agreements have been the basis for the "utility access fee" charged by certain utilities, and funds received by the Development Company in accordance with these agreements have been directed to The Woodlands Community Facilities Development Corporation to fund community improvements and amenities. 
 
Under incorporation of The Woodlands, the new city would have the statutory ability to implement franchise fees. However, implementation of a franchise fee would not necessarily eliminate the access fee or the access fee agreement between the utility and the developer, as this would depend on how the access agreements are structured.
 
Although the Township may not be able to attain the specific amounts collected under existing agreements, it would be helpful to understand if there are existing access fees that may be impacted by the implementation of a Woodlands franchise fee. If access fees are presently being collected, the implementation of a franchise fee could potentially replace the access fee. If access fees are not currently being collected, the implementation of a franchise fee would represent a “new” charge for Woodlands residents.
 
The Township has made previous requests to the Development Company for information regarding access fee agreements. The Development Company has maintained the utility access fee agreements are private agreements between private corporations and contain confidentiality provisions. As such, information regarding these agreements could not be released to the Township. 

Following the March 27 request by Director McMullan, a Development Company representative advised that they have one current access fee agreement and that agreement is with Comcast. This information will be beneficial to the Township and its consultant when evaluating franchise fees and the associated financial impact.
RECOMMENDATION:
Board to determine action.

    

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