McKinney Municipal Utility District No. 1 (MMUD1) is the legal subdivision of the state located in the City of McKinney’s ETJ but not in the city limits as of now. I am going to refer to it as MMUD(s) because documents refer to MUD1 and MUD2, but MUD1 is the Master District. The City has control of a number of construction requirements and is party to an agreement that allows the City to even contract with the MMUD for the City to provide certain services. MMUD was created in the 80th legislature in 2007 by Rep. Jodie Laubenberg as HB 3979.

This MMUD is also the entity involving the Trinity Falls Development. From everything I hear, the Developer is experienced with these kinds of financing vehicles. This blog is not about the developer per se. It is about MUDs in general and the MMUD as an example in particular. MUDs are about helping the developer get a project financed. MUDs are in abundance in the Houston area. Missouri City, as an example, has 25 MUDs in their city limits. MUDs are not so popular North Texas. And for a reason. Take a poll of the Houston area cities with MUDs and ask if they could undo the MUDs today if they could?

MUDs help with leap-frogging development. Leap-frogging is not a positive term. In many cases it means allowing islands to be created. Everybody knows that the best growth management is in contiguous concentric circles, but that never happens like the textbook pictures. There are always people wanting to get away from the city where land is cheaper. And almost always the growth fills in between until the outlanders become just like the city, too.

In the map below from the Municipal Advisory Council (MAC), it shows Collin County in green, McKinney ISD in blue and MMUD in pink. MMUD is 880.42 acres in size. In other disclosures, the Trinity Falls property is shown to be 1,700 acres. Therefore, one must assume that MMUD could expand. I have heard that there will be a MUD3 and MUD4 at some point in time.

The purpose of the MMUD is to sell bonds to pay for the infrastructure (and substantial other costs) put in place by the Developer. By infrastructure, it is meant to be roadways as well as water and wastewater lines. How much in bonds are anticipated? That becomes a very interesting question. We turn to their bond disclosure documents to understand. MMUD shows the authorized debt to be as follows:

$133,050,000  Roadways.
$145,000,000 Water & Sewer System.
$  10,240,000 Fire Protection Related.
$288,290,000 Total Bonds Authorized.

You are probably asking if this could be correct? It’s going to take $288,290,000 to provide infrastructure for 880 acres of mostly residential development?

Again, we look to official documents to understand. As it turns out, they show only 680 acres of development, and it is all residential. The remainder is for parkland, an elementary school or is undevelopable.

Unless you’ve beat me to it, then $288,290,000 divided by 680 acres is $423,956 per acre. Based on an average of what they have disclosed so far, the average lots per acre is 2.935. That would mean the bond authorization placed on a per lot basis is $144,443 per lot!

Before we go further, it is important to realize that bond authorization does not mean they will sell that much in bonds to repay the developer. However, the significance is still there, and I guarantee you $144,443 is probably not a number shown to the McKinney City Council or that staff bothered to calculate or that the council bothered to ask.

So What If The Lot Cost Is Very High?

You can say that if the buyer wants to purchase a house that has $144,443 in it before any vertical construction begins, then that is their business. But that is why we must dig deeper. If it goes into the value of the house, then you know the full cost. However, homeowners in the MMUD must be on their toes to realize the cost of the house they pay to the builder is only part of their costs.

In addition, they have to pay a MMUD tax that covers the $144,443 per lot:

House Price Paid by Mortgage.
+Infrastructure Paid by MMUD I&S Tax Levy Paid.
= The Full Cost of the House & Property.

The MMUD tax is the issue that can become troublesome. Take a poll today of the MMUD occupants and ask if they understand the MMUD taxes?

How Much Is The MMUD Tax?

There are two parts to the answer. The first is how high could the MMUD Tax be. The McKinney ISD has a maximum rate that is very high. It is a total of $1.67 per $100 value. That is broken down into Maintenance & Operations (M&O) of $1.17 and $0.50 for Interest & Sinking (I&S or Debt Service). Both components are at the maximum the state allows.

The City of McKinney’s tax rate, although not charged to the MMUD property owners, is $0.5830 with $0.4100 being for M&O and $0.173 for I&S. It is nowhere near the maximum allowed by state law.

The MMUD is quite different. The M&O maximum tax rate is $1.20. However, there is no limit on the I&S portion of the tax rate. Therefore, there is no legal limit on the tax rate.

However, the question first at hand is what is the current MMUD tax rate? The answer is $1.05 per $100 broken down into $0.505 for M&O and $0.545 for I&S.

Therefore, if you live in the City of McKinney, the total tax rate is $0.5830. If you live in the MMUD, the tax rate is $1.050.

Okay, So What?

Your next thought might be the same as mine, and that is won’t the house price and taxable value of the house reflect a lower amount since part of the home is financed out of the mortgage and part out of the MMUD tax?

Let’s check. One MMUD home on Sabine is valued at $397,392. The land value is $80,000 for the lot, and the improvement value is $317,392.

The lot is 7,500 square feet or $10.67 per sf. The improvements, based on 3,612 sf would be $87.87 per sf. for a total of $110.02 per sf when the total value is stated on the main area of 3,612 sf.

What do you think? Discounted or not?

Of course, these are Collin County Appraisal District values and not the actual purchase price. The purchase price could have been lower. Or higher.

It must be mentioned that these are the market values as shown by CCAD before any exemptions are taken into consideration.

What We Do Know.

The total tax bill on the example property, before exemptions, would be $3.03696 per $100 when adding in the MISD ($1.67); Collin County ($0.235); College District ($0.08196) to the MMUD’s rate of $1.05.

These are the current year’s rates. The tax rolls will not be certified until July 25, 2016 for the tax bills mailed October 1, 2016 and due January 31, 2017. So sometime between July 25 and October 1, the MMUD will be setting their tax rate for the bill to be mailed by October 1. It could be the same or lower. There is virtually no ceiling on the topside.

When the tax bill is received (again, before exemptions) of $12,068.64 ($397,342 x $3.03696 / $100), the homeowner will realize what they have bought into by being in the MMUD.

Were they told of the MMUD tax potential at the closing of the purchase? Oh, yes, they signed a document along with dozens more when they were just hours away from getting the key. The tax bill may have been incorporated into the mortgage, so the homeowner will have a wake up call to examine their escrow every year when insurance and taxes possibly change. A fully informed potential buyer would be educated when they drove into a subdivision of MMUD. I drove around this morning and didn’t see a sign.

Lewis, Why Do You Care If The MMUD Homeowner Gets Riled?

I don’t. My concerned being raised is about the City of McKinney. Maybe even the County/CCCD. If you read through the documents, you can find quite a bit of language that says, read our lips, the City and the County are not responsible for the debt and payments of MMUD. But you would be quite naïve if you think there are no repercussions.

First, I don’t like it that the MMUD has the name “McKinney” in it. If there was ever a MMUD default, the headline would not be favorable for the City. Also, the history of MUDs all over the state is for the homeowners to get restless or irritated with a dose of buyers’ remorse once they realize their tax bill would be lower by $1,846.68 annually ($1.05-0.5853 x $397,392 / $100) if they lived in the McKinney city limits. Take a poll of the highest tax rates in Texas and you will find mostly MUDs at the top of the list.

If the MMUD homeowners believe they got duped paying a competitive price for their house plus a tax rate that included part of their house (meaning they paid twice for part), then embarrassment turns into rage. Especially if they can’t sell their house to escape the burden. Before long they may start wanting to run for City Council to force the absorption of the MMUD by the City AND to absorb the outstanding debt at the time. It HAS happened across the state. If they see that the City is part of the agreement and had plans to incorporate the MMUD, then why not now?

What About The Debt?

Now we are getting to the guts of the matter. The tiny little MMUD has been authorized to issue, $288,290,000 in bonds supported only by the property owners of MMUD. They have issued only $13,800,000 to date in two issues. However, they are ramping up in that $8,070,000 was dated September 1, 2015 with a secondary issue of $5,730,000 dated February 1, 2016. The race is to sell debt as fast as possible to reimburse the developer when there is value on the ground to carry the debt service.

For a perspective, the entire outstanding debt for all of Collin County is $379,084,150! For all of the City of McKinney, the outstanding tax related debt is $307,790,000!

Do you see my concern?

Can the City of McKinney control the issuance of more debt until they have confirmations there is not going to be a negative impact on the City, legal, public relations or other? The answer is yes and no.

By contract, the City has placed a cap of $120,000,000 of debt issuance on MMUD unless they approve to raise the level.

So, Lewis, why don’t you shut up and wait until a problem crops up? First, I’m not geared that way. My entire career has been about worrying over things that could blow up. But the real reason is that I was waiting for the audited financial statements for the MMUD for their fiscal year ending March 31, 2016.

Then something happened on the way to the wait station.

The McKinney City Council shows a workshop agenda for tomorrow night and a Council meeting agenda item on Tuesday night to amend the 2012 agreement. McKinney does a horrible job of providing background before a meeting as I complained about in my last blog. First, they claim the amendment resolution preamble is in the best interest to the City. Quite noble, but they don’t explain the benefit. In fact, there is no staff paper, no real back story, no staff recommendation.

What the amendment does say, to me, is that MMUD is being given permission to raise the debt issuance limit to $262,800,000!

Why in the world if there is already a $120,000,000 cap with only $13,800,000 issued would MMUD need to lift the cap right now?

And nobody seems concerned that all debt issuance and taxes entity have a bearing on each other. A $million of debt uses everybody’s debt capacity. A penny tax increase is a penny of taxing capacity the resident can afford.

Conclusion & Recommendation.

I am concerned how we allowed a MUD to get created in McKinney in the first place. Yet bigger, since we are only about 50% built-out and tens of thousands of acres left to be developed, how are we going to say no to the next Houston-style method of incentivizing a developer? In fact, why are we incentivizing residential development at all? In addition to allowing the MUD financing vehicle, the City is granting a sales tax split to MMUD!

I am requesting of the City Council that this agreement amendment be postponed until the middle of July when the audited financial statements should be finished as well as the certified tax roll be delivered.

More importantly, I suggest the City Council require a five-year plan be provided to the City Council when additional bonds are issued and made a requirement for City approval to go forward with future bonds. The financial plans should show the lot and construction pipeline as MMUD already discloses now to bond holders in their official bond issuance statement. The plan should also show the tax value assumptions, the debt issuance/debt service assumptions as well as the tax rate component forecast for the next five years. It is with 100% certainty that MMUD has this information.

In fact, the bond rating agencies would be insisting to see this information. Except there is one problem: these bonds are not rated nor or they guaranteed by a bond insurer. And there is a reason for their absence. Only very sophisticated buyers would be interested in these bonds. And there is a premium they earn for the risk. Take a poll of the interest rates on these and other MUD bonds compared to typical tax supported bonds.

At this point, I am not suggesting that toothpaste can be put back into the tube. However, the MMUD board meetings should be held in McKinney and the City needs to be involved in monitoring. The MMUD now shows bookkeepers, financial advisors, bond attorneys and auditors all being from Houston. They are very smart people with absolute perfect knowledge of how MUDs work. I have to wonder if the City of McKinney asked their own financial advisors and bond attorneys the pros and cons of allowing a MUD to be created in the ETJ? Who did the due diligence on this proposition from the beginning and since the inception?

Ironically, they show Chandler Merritt, Public Works Director of the City of McKinney, as a finance-connected official according to the Municipal Advisory Council. Go figure!

Lastly, it should be noted that 29.1% of the $13,800,000 in bond currently outstanding went toward soft costs (legal fees, financial fees, capitalized interest and other non-construction costs). There is an entire cottage/mansion industry in Houston related to MUDs. We really need to think long and hard about the potential for MUDs to proliferate in North Texas.

Nobody thinks through how these animals end, but there are many stories of ugly exits as they take on a life of their own and want to be absorbed when it is in the best interest of the MUD. But my overriding concern is that a council known for making decisions without full public disclosure really needs to monitor the MMUD and any MUD in the ETJ. LFM

 

 

 

 

 

[Note: this blog has been updated to correct an error in the table and also to expand the table to be more informative with the breakdowns between cities, counties and school districts. The overall message is generally the same, but a few specific comments have been updated. LFM]

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It will be best if you read yesterday’s blog before delving into today’s information.

Introduction.

Sometimes it can be dangerous to start comparing one local government to another. Part of the reason is that no single piece of data can tell a complete story. The other part is a fairly compelling argument that you must understand a lot about all of the cities in the comparison. There always will be outliers. At the same time, you will tend to see norms forming as certain ratios begin to cluster. And it is the ratios that are absolutely necessary to see. Ratios are the equalizers, or as close as we can make the data reveal a story.

First, you must select relatively meaningful entities to compare. Two common criteria are size and proximity. Below I have compared eight cities using those guidelines. Four are very close in size regarding population. Plano is included due to proximity to McKinney. I might have omitted Lewisville and even Denton except they are close in size, and Denton is a county seat city. Taken together, they perhaps form a nice U-shaped, contiguous configuration that starts and ends with McKinney and Denton in alignment with Hwy 380 to complete the horseshoe.

Building on yesterday’s blog, we have now enhanced our knowledge base considerably. I intentionally wanted you to focus on just the underlying approach and to be hungry to see how McKinney compares with a meaningful sample as presented today.

The absolute dollars are interesting but the least helpful in comparisons until you view the data on some common basis such as the percentage distribution. The average/median is 22.9/28.7% for the cities, 8.2/9.2% for county related and 68.9/62.2% for school districts. To no surprise after learning about the domination of ISDs yesterday, McKinney is well above the average and median. But let’s look deeper.

On a Per Capita basis, McKinney is quite high at $7,102 second only to Frisco with $10,476. Plano is the outlier on the lower end of the spectrum.

On the other key metric, Debt as a % of Taxable Values, McKinney is the third highest, with Frisco and Denton quite a bit higher.

So, What Are Our Takeaways?

There’s actually quite a few.

• We have confirmed that the school districts dominate in debt in just about every comparison.
• We have shown where McKinney is significanly higher than most of the cities we might use for comparison purposes in an effort to establish a “norm.”
• As a burden on city taxpayers, McKinney’s load due to ISDs (McKinney ISD, Frisco ISD predominately), is noteworthy.
• It is possible that we have spotted a cost differential with Frisco ISD’s policy of more but smaller high schools versus Allen ISD’s single high school. Not sure, more digging required to explain any outlier. What we also don’t know is the school building unused capacity for any of the school districts.
• We may have also spotted a high % of the tax base for debt in Denton due to the combination of so much non-taxable property with two large universities as well as county facilities. Again, validation requires some digging.

The Bigger Hidden Story.

Even well-managed city cannot control the other local governmental entities. Also, in many cases, counties, cities and school districts don’t talk to each other any more than they have to. In fact, many overlapping entities stay at odds with each other. Even though they serve the same taxpayers.

This friction becomes obvious to people like bond rating agencies having to evaluate each entity in light of one taxpayer and the vast number of bond holders. If the bond rating agencies and the citizens could huddle in one spot and deal with this one question, what do you think the outcome would be?

The Question: what could be done regarding debt and tax rates that would be the best for the citizens and the bondholders regarding affordability, ability to pay and willngness to pay?

The Possible Answer: Develop a policy that sets some parameters so that we can see the picture as a whole. For debt, the amount cannot exceed a total of $________ per capita with no more than $____ going to the county, $______ going to the city and $______ going to the school district(s).

Can you see how that is not so hard to do when you put comparative data in front of intelligent people willing to serve the people? Financial policies can be formulated, adopted and then revisited annually to affirm a gyroscope is in place to assure responsibleness. Can you imagine a set of policies everybody can articulate?

Conclusion.

Okay, okay, climb back over your pew and sit down. Even the bond rating agencies don’t like caps that could threaten the ability to repay the bond holders and to disrupt the operations of the local governments. I’m just trying to convey that more and more attention is being given to data-driven decisions. There is a maximum limit out there somewhere. Some say there is room to go. Others say were are there right now. Yet others say we have passed the limit. Can you put a number on it? I can. And you can, too.

Here is what we know. We (public officials and citizens) either self-police or else we risk somebody imposing a lid on us. In fact, did you know there is a traveling senate committee going around the state armed with data they are misusing to basically be prepared to stifle local governments’ ability to decide? We have prominent state officials elected on the promise they would try to eliminate property taxes? They had much rather “clean up” local government than to face their own egregious mishandling funds at the state level.

But heed the warning. Even today another story came out about Garland ISD missing the cost of a $20 million natatorium the voters approved by $10 million!

We are violating the principle of taking care of the basics and, if possible, do a few frilly things. In fact, the optional things that allow an elected official’s name on a building plaque are coming ahead of the crumbling streets and school buildings in many cases. More on that topic coming up. LFM

 

Introduction.

I have always encouraged MPA students to work hard on being able to visualize the magnitude of numbers they hear. Basic things. A single acre of land. A square mile. A football field. A water storage tank size in gallons and the cost per gallon to build. The cost of a lane-mile of roadway. Hip pocket numbers I would say. You will forever be in discussions about the size and cost of things. Be prepared to do a logic test.

At the same time, don’t shy away from putting big numbers in context. It is early and quite often you start hearing millions and billions. If you hear that the city uses 10 billion gallons a year, don’t immediately think waste. It might be. But for McKinney with a population of 155,142, that breaks down to 176.59 gallons per capita per day (gpcd). And since that includes commercial and industrial water use in the average, the residential portion would be less. But the point is that 10 billion is a large number easily misinterpreted unless placed in a proper perspective.

The perspective becomes more important when talking about dollars. There is an interesting principle involved here that I must pause to explain. If you want to place emphasis on a metric, you multiply it as high as possible. “We’re going to be using over 100 billion gallons of water over the next 10 years!” If you want to minimize the emphasis, you divide to the lowest possible level. I just did that with my gpcd calculation.

The principle can be applied to deliberately distort facts. Or to genuinely understand a perspective. I just want you to know that I know the game. At the same time, I want you to appreciate that I am trying to help. If you are interested in local government, you deal with a lot of numbers and some very large numbers. With the massive amount of growth in Texas (a million new people every 7-10 years just in the Metroplex), one must gird up to appreciate the task of grasping large numbers. The minute you hear, “we get 36,000 calls per year,” whip out your calculator and see how many that is per dispatcher per day or hour just to equip yourself with a perspective.

Let’s Play With Debt.

I am the first to be cautious about debt. And if there is a viewpoint I take, it is that of the bond rating agencies representing the concern of the bond purchasers. Why? Because in my entire career, rating agencies are the first (and for years the only) outsiders that care about the consequences of today’s actions on the future. They appreciate a good financial condition today, but can you repay your bonds for the next 20 years? They also know the importance of one governmental entity on the others. That starts at the state level. But the more granular local level rises to take center stage fairly quickly. From the taxpayers’ standpoint, the checkbook doesn’t care. What is the total tax bill? So, too, it is the bond rating agencies’ concerns about the overlapping impact of things like debt and tax payments that we focus on today.

In the table above, you can see about 11 lines down that the City of McKinney has $263,424,127 in debt supported by property taxes. That is a significant amount of money by any yardstick. However, the story that often goes unnoticed is that there is an additional $824,470,845 in overlapping debt from Collin County, Collin County College District and the School Districts inside McKinney.

Clearly the County and CCCD are not overly burdensome. However, the ISDs make up $760,891,739 of the debt carried by the taxpayers inside the City of McKinney. In total, it all adds up to $1,087,894,972. Now you can get a sense of the magnitude of debt and the sources? By the way, these numbers come from required financial disclosures to the public – wonderfully informative data often ignored by local government leaders and citizens.

In an effort to place over $1 billion in debt into perspective, I have shown the number as:

• $7,012.25 per capita.
• $20,966.64 per household.
• 7.10% of the taxable values in the City of McKinney.

The next obvious question is How does McKinney compare with Plano, Frisco, Allen and other area cities? I’m going to give you that answer in a future blog, but that is not the point here. In one sense it doesn’t matter. The objective is to understand our own and how local governments impact each other. And when we can carry no more?

Another perspective is to appreciate the direction we are headed with debt. These numbers do not include the approximate $110 million recently approved for the City and the $220 million for McKinney ISD. After those bonds are issued, along with other authorized bonds but unissued bonds, there will be some bonds that will have been paid off. Therefore, these metrics change often but generally trend upward.

In any case, whether viewed as total absolute dollars or on a per unit basis (capita, household or tax base), it’s a lot of money. Every elected official and appointed money board member needs to have these hip-pocket numbers in their head or in the cell phone notes.

What About Overlapping Tax Rates?

Again, when viewed in total, the numbers are quite high. The City of McKinney has not raised the tax rate in years; in fact, they have been lowered slightly. However, the bill that the taxpayer gets is based on the total of all taxing entities, and that number is about $2.48 per $100 of value broken down as follows:

• City of McKinney $0.583
• Average  ISD $1.590
• County/CCD $0.307

Conclusion.

It’s hard not to be the Master of the Obvious, but clearly almost 70% of the debt carried within the City of McKinney boundaries is related to school districts. ISDs also account for about 64% of the tax rate.

MISD is supposed to be lowering their rate by 2-cents next year, and the FISD is talking about raising theirs considerably. FISD can by law go up to $1.67.

This blog is one of many planned to take a spoonful of local government finance items at a time. I encourage you to study the selected numbers and the associated perspectives and stories.

The City of McKinney voters took a menu of bond propositions and said yes to most but no to $millions of others. McKinney ISD gave the voters an all or none proposition that included $50 million for a football stadium to add to almost $12 million authorized in past years and yet to be issued.

It is imperative that citizens and all taxpayers look at the entirety of the burden placed by county, city and ISDs collectively. It’s all coming out of the same pocketbook.

There is also a finite amount of debt and taxes that can be placed on the public without there being some repercussions. We aren’t there yet from the bond rating agencies’ standpoint else we would be seeing some downgrades. But we must understand that the rating agencies look at both 1) ability to pay and 2) willingness to pay.

Collin County is a very wealthy sub-region in a wealthy region in a relatively wealthy state. Citizens keep allowing bonds to pass and tax rates to increase. Therefore, we keep passing the ability and willingness tests. For now.

However, we aren’t paying sufficient attention to big-ticket liabilities coming down the road. I have blogged about many of these and will continue to do so.

When the McKinney City Council sat passively and listened to the pitch for the MISD bond program by their superintendent, I was thinking, my goodness, the City just winked at $62 million of future roadway needs that would have been the exact some impact on Joe Sixpack (me). But that concern would only come up if people really thought about the sustainability of the community for the long-term future.

Also, near Houston, the Katy ISD 12,000 seat football stadium was reported just four days ago to have increased from $57.6 million to $62.0 million. The increase was for add-ons and unforeseen infrastructure requirements.

MISD has yet to go our for, receive and award a bid. It’s a long time before the kickoff whistle blows. LFM

 

Listen up, MPA students and future council candidates! The City of McKinney has just given you a wonderful case study. First, you need to invest a little time to watch this presentation to the City Council and how the meeting played out. Here’s my take:

A group wants to take the City’s best and biggest sports park, Gabe Nesbitt, and investment money to upgrade the fields so they can be used for tournament leagues and bring more out of town teams to play on our fields. They also want to control and collect all of the money, including concessions. They also want the City to continue paying for much of the maintenance costs.

Oops! That becomes unclear right the very beginning. What the company is saying in their presentation doesn’t exactly jive with the materials they already had in the Council packets. They do the typical, “let me blind you with dreams of massive economic benefits” and show a very large $30 million tag. Except the Council isn’t so blind. In fact, they almost compete to ask good professional questions. The company’s answers aren’t so good. They have a good ole’ boy speaker who doesn’t impress the City Council.

But the Council is playing nice. You can tell by their tone that they are trying to be fair and hear the full pitch. Then they ask the Rhoda Savage, the Parks & Rec Director to comment. She is polished and makes some very good points. Her credility is sky high with the Council. You can sense her skepticism, but she is all professional.

Then an original McKinney good ole’ boy speaks. He is not polished, but he is powerful. He calls out 50 years of memories with the good ole’ boys on the Council. While being polite, he delivers a sledge hammer plea. He’s repeats more than once that he is not smart enough to figure this out, but you know very well he is smart as a whip.

But then comes the polished and well thought out speech from Lonea, head of one of the McKinney baseball leagues. She raises questions that nobody in the room would have thought to consider. Bang, bang, bang. You could sense that the Council probably has seen her stern professional demeanor, but they know there is a fire that they surely want to contain.

At this point you know this pitch is not going to fly. But then the bureaucratic (from the Council, not staff) agony overcomes the meeting, like a thick cloud of goo. Oh my goodness, here comes the process. We’re going to study it to death. A park master plan has just be done. It is so new that it hasn’t been presented to the council. Undo? Redo? How to scope another study? Who should do it and who should pay for it? Can’t be staff. Too busy. It will have to have tons of community input, from the same people who were just asked for input on the park master plan.

Stop. Stop. Stop. Every councilmember either doesn’t want this or shouldn’t want it in light of the lousy presentation from the business and the multiple questions raised by the baseball league representatives. Nobody even asks if this is such a good deal, and the business is going to make sufficient money to make a profit or perhaps just break even after they put $millions into it and set fees to cover their costs, then McKinney only has literally tens of thousands of undeveloped acres, so why not do their own thing?

This is insane. The Council is going to allow this to go several steps through the process just so they can say they went through a process in order to say no. NO is the correct answer RIGHT NOW. Why waste staff time? Why get the baseball family in an uproar? The Council knows the little leaguers can fill the council chambers 10x over – and will.

Or they could write a polite letter:

Dear Company:

Thank you for your interest in McKinney. We believe that all of our current resources going mostly to the advantage of recreational baseball is the will of the Council reflecting the will of the people. We believe there is plenty of land in McKinney for you to create a tournament league complex in McKinney, invest your money and set your own fees. By the way, you happened to mention in your answers to some questions that there was some legal action being taken in some adjacent communities where tournament leagues were not being given the same status as recreational teams. We would have to tell you that making that statement was not a very smart thing to do. We wish you well in your future endeavors.

Respectfully,

McKinney City Council