Incorporation Study Public Information Session

September 23, 2021

Governance of The

Woodlands has evolved

over time as the area has

grown from a small

master-planned

development to a thriving

community with a

population of 118,000.

With the passage of state legislation in 2017, The Woodlands Township Board received the authority to place incorporation on an election ballot for consideration by the voters.

These are the steps the

Township Board

considered prior to

placing incorporation

on the ballot.

118,000+

Ballot LanguageTHE WOODLANDS TOWNSHIP – PROPOSITION A

Authorizing the Type-A city incorporation of The Woodlands Township District

and the adoption of an initial property tax rate of not more than $0.2231 per

one hundred dollars ($100) valuation of taxable property.

THE WOODLANDS TOWNSHIP – PROPOSITION B

Upon incorporation of The Woodlands Township District into a Type-A General

Law City to be called the City of The Woodlands, the transfer of the rights,

powers, privileges, duties, purposes, functions, responsibilities, the authority

to issue bonds, and the authority to impose taxes from The Woodlands

Township District to the City of The Woodlands.

 Election Day is Tuesday, November 2, 2021.

Early voting begins Monday, October 18, 2021.

For more information on The Woodlands Township election,

visit www.thewoodlandstownship-tx.gov/NovemberElection. 

The Woodlands TownshipIncorporation Study Process and

Findings Overview

September 23, 2021

Our Presenters

19

Julia NovakExecutive Vice President

Jonathan IngramSenior Manager

Project Team

20

Josh RauschManager

Rebekka HoskenManager

Eric HallHR Green

21

1. Who We Are

2. Incorporation Study Goals and Approach

3. Incorporation Study Findings

1. Revenue Under Incorporation

2. Law Enforcement

3. Infrastructure/Public Works

4. General Government

5. Tax Rate Impact

4. Topical Q&A

Agenda

22

Who We Are

23

Who isTNCG/Raftelis?

One of the most experienced

municipal financial and

management consulting

practices in the nation.

TNCG/Raftelis has provided financial/ organizational assistance for

1,200+cities, counties and utilities

that serve more than

25%of the U.S. population

including the agencies serving

38/50of the nation’s 50 largest cities

24

TNCG/Raftelis Management Consulting

EXECUTIVE

SEARCH

ORGANIZATIONAL

ASSESSMENTSTRATEGIC

PLANNING

Improving organizations for those they serve and those who work in them

25

Incorporation Study Goals and Approach

26

New Revenues

What new revenues are available under incorporation?

New Services/Costs

What services become “City” services, what are the start-up costs, and what are ongoing costs?

Governance

How does governance change under incorporation?

Tax Rate Impact

How will incorporation impact property tax rates?

Incorporation Study Objectives

• Provide an objective, fact-based, third-party assessment of incorporation implications

• Protect or enhance all existing service levels

• Inform board and voters without advocating a position

26

2

3

4

5

1Service Level

Define and protect service levels.

27

Project Timeline

Feb 2018

Study Process

Initiation

Township hires

Matrix and TNCG

to complete dual

studies; TNCG to

serve as peer

review

Study Refinement

TNCG contracted

to finalize financial

model and

develop new law

enforcement study

December 2018

December 2018 –

February 2020

Decision Making

TNCG presents

findings to public

and board and

finalizes

incorporation

model

assumptions

COVID Disruption

Incorporation

deliberations

delayed due to

COVID disruption

April 2020

August 2021

Incorporation

Process Restart

Incorporation

model applied to

current Township

budget to derive

revised tax rate

implications

28

TNCG/Raftelis Role

• Inventory current service levels

• Complete benchmark community comparisons to inform and validate financialmodel assumptions

• Define service alternatives and cost impacts for new “City” services› Revenue impact› Law enforcement› Public works› General government

• Incorporate HR Green transportation infrastructure assessment into financialmodel

• Develop comprehensive financial projections to inform maximum tax ratecalculations

29

Revenue Under Incorporation

30

Goal 1

Identify reasonable baseline projection assumptions based on historical revenue and expense trends in each fund

• What happens if the

Township remains

unincorporated?

Goal 3

Identify new revenues

available under incorporation

• Validate assumptions

based on learning from

benchmark comparisons

Revenue Analysis Goals and Approach

Goal 2

Define projection scenarios

that reflect strong as well as

limited revenue growth

• What are the parameters

that the Board can work

within as they define

revenue and expense

alternatives under

incorporation?

30

31

Revenue Analysis Goals and Approach

• Applied trend analysis to The Woodlands Base Budget and five-yearplan to project three baseline scenarios

› Probable – Assumes revenues based on actual five-year historicalexperience

› Budgeted – Assumes revenues based on assumption valuesincluded in the 2019 five-year plan

› Constrained – Assumes flat revenue growth

• Define new revenues available under incorporation

› Revenue estimates informed by benchmark comparisons

32

Revenue Growth

Assumptions

TNCG/Raftelis

Probable Scenario

The Woodlands

Five-Year Plan

Property Tax 2.00% 2.00%

Sales and Use Tax 3.00% 2.75%

32

Comparison of Growth Assumptions

These revenue sources account for 80% of the Township’s annual budget.

33

New/Impacted

RevenueDescription Year 4 Financial Impact

Franchise Fees Collected from utility operators $7.6 million per year

Alcohol and Beverage

Tax

Revenue share from the sale of alcoholic beverages

$1 million per year

Fine and Forfeiture

Revenue

Revenue derived from enforcement of local ordinances

$930,000 per year offset by

Municipal Court expenses

Building Permit

Revenue

Revenue derived from development and building plan safety, code, and regulatory review

$150,000 per year offset by permit

review staff/contract expense

New Revenue $9.7 million in new revenue

New Revenue Under Incorporation

34

Law Enforcement

35

Law Enforcement Study Team

Julia Novak

Executive Vice –

President

• Former City Manager

• 30+ years local

government and

consulting experience

• Has worked with

hundreds of local

governments nation-

wide and lead dozens

of law enforcement

studies for large and

small jurisdictions

Bill Connors

Law Enforcement Specialist

• 30+ years of law

enforcement experience

• Retired from NYPD in the

top 125 of 40,000 staff

department

• Served as police

commissioner

• Over 30 law enforcement

organizational assessments

Jonathan Ingram

Senior Manager

• Completed over 40 law

enforcement staffing

studies and organizational

assessments

• Broad expertise in data-

based staffing and

deployment

methodologies for patrol,

investigations, and

support services

Joshua Rausch

Manager

• Computer Aided Dispatch

(CAD) data analysis

expert

• Workload and staffing

analysis on public safety

projects in jurisdictions

with populations from

20,000 to 350,000

36

Law Enforcement Study Goals

• Define the staffing level and cost required to provide law enforcement in The Woodlands under three service alternatives• Full-service department

• Hybrid in-house and contract model

• Contract model (current approach)

• Compare the structure of a full-service department to benchmark jurisdiction police departments

• Must maintain or enhance current service levels

37

Law Enforcement Study Approach

• Extensive engagement with current law enforcement providers in Montgomery and Harris counties• Fact finding regarding current service levels and service delivery model

for direct and indirect services

• Review and validation of all analytical findings with actual service providers

• Comprehensive assessment of actual costs for The Woodlands law enforcement services and current contractual agreements

• Reflection of transition agreements negotiated in good faith between The Woodlands and Montgomery County to maintain continuity of service

38

Law Enforcement Study Approach

• Analyzed data provided by Township and MCSO• Dispatched Calls for Service (DCFS) workload analysis

• Crime trends

• Investigative workload

• Other workload and performance measurement data

• Benchmarked police staffing levels in Allen, Frisco, Round Rock, Southlake, Sugar Land, and Conroe

• All current and anticipated services are represented in each law enforcement model and reasonable, informed, and vetted cost estimates are reflected

39

Law Enforcement Service Level

Overview

40

Full-service

Standalone

Department

• Standalone police

department composed of

The Woodlands personnel

• Fully-loaded cost of

standing up a Department

• Defines the ceiling of law

enforcement costs

• Includes City Marshall/Chief

Contract Services

(current)

• Continues current

arrangements with counties,

as amended by the

transition agreement(s)

• Includes City Marshall/Chief

Three Law Enforcement Models

Hybrid: In-house and

Contract Services

• Most police officers

provided by The Woodlands

while continuing some

contracted services

• Takes advantage of regional

specialized services and

economies of scale

• Includes City Marshall/Chief

40

41

Patrol Investigations

Support

Services

Specialty

Services

Service Level Continuity

Each law enforcement model maintains or enhances all existing service levels across four broad program areas

41

42

Patrol Staffing

• Each model replicates current patrol staffing level

• The International Association of Chiefs of Police (IACP) guideline recommends allocating at least 33% of an officer’s time to proactive policing

• Proactive policing allows an agency to focus on identified trends, high crime areas, and community engagement

• Patrol staffing levels under each law enforcement model allow Woodlands to continue to exceedbest practice guidelines at 52% proactivity

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• Each staffing model replicates direct services and staffing levels provided under the current contracts

› General Investigations

› Major Case Squad

› Narcotics

› Crimes Against Children

› Victim Services

› Professional Standards

› Administration

• Maintains capacity to meet current contractual service levels in each law enforcement model

Investigations Staffing

44

Support Services Staffing• “Back office” requirements of a

Police Department are considerable

• Many support services have been provided to The Woodlands by the MCSO, MCCO, and HCCO without explicitly defining the services and service standards in interlocal agreements

• Critical to build support service capacity to carry out law enforcement activities beyond Patrol and Investigations

45

Each law enforcement model maintains current service level and resource commitment across 15 discrete support service programs

• Community Engagement

• CSI/Lab/Evidence

• Dispatch/PSAP

• Training and Recruitment

• Accreditation

• Real-Time Crime Center

• Records

• Animal Control

• Facilities Maintenance

• Fleet Management

• Finance

• Human Resources

• Information Technology

• Municipal Court

• Administration

Support Services Staffing

46

Capital/Start-up

Cost

47

• Major drivers are expanding dispatch, RMS, and new Police Headquarters

• Vehicles and Equipment• Includes body-worn cameras, radios, cell phones, PPE, vehicles for sworn

staff

• Also includes specialty equipment for animal control, crisis intervention, SWAT

• Accurately reflects what is already funded in Township’s 5-year plan

Capital and Start-up Cost

48

Hybrid In-House/ Contract Model

49

Hybrid In-House/Contract Model

In-house Staff

• Patrol

• General Investigations

• Narcotics

• Professional Standards

• Investigative Administration

• Community Engagement

• Support Services Administration

• Corporate Support (Fleet, IT, HR, etc.)

Utilizes Counties for Support

and Specialty Services

• Emergency Communications/Dispatch

• Recruitment and Training

• Major Crime Detectives

• K9 Services

• SWAT Team & Hostage Negotiation

• Crime Scene Investigation & Crime Lab

• Auto Theft Task Force

• Jail Services

50

Continuity of Service - Current Transition Agreement

County Fiscal

Year

Number of County

Personnel

Maximum

Reduction by

percent

Remaining

County Personnel

if All Reductions

Are Made

1 (Year of Incorporation)

92 0% 92

2 92 20% = 18 74

3 74 30% = 28 46

4 46 30% = 28 18

5 18 20% = 18 0

51

Continuity of Service - Current Transition Agreement

Law Enforcement ProviderYear 1

(at Incorporation)Year 2 Year 3 Year 4 Year 5

MCSO - Direct Personnel 19 0 0 0 0

MCSO - Supplemental Personnel 92 74 46 18 0

MC Constable’s Office 3 3 3 3 3

Creekside Park – Harris County & The Woodlands Police

12 12 12 12 12

The Woodlands Police 7 44 72 100 118

Total 133 133 133 133 133

Support Services* 0 8 21 33 42

Grand Total Law Enforcement 133 141 154 166 175

52

Hybrid Model – Takeaways

• Patrol – Replicates current staffing level and allows The Woodlands to continue to exceed best practice guidelines in each law enforcement model

• Investigations - Replicates direct services and staffing levels provided each law enforcement model and maintains capacity

• Support Services - Each law enforcement model maintains current service level and resource commitment across 15 discrete support service programs

• Specialty Services - Other program areas covered through special assignment are reflected in each law enforcement model

• Facilities and Infrastructure – Outfits department with facilities, IT resources vehicles and equipment

53

Hybrid Model – Takeaways

• Creekside Park / Harris County service continuity maintained› Protects continuity of service and ensures a minimum of

12 sworn officers dedicated to Creekside Park at all time

› City patrol officers will provide overlapping service to Creekside residents

54

•Approximately $9.7 million in new annual operating costs for personnel, materials, supplies, and overhead

• Offset by new revenues, including court fines/fees and projected growth in existing revenue sources

•Approximately $9.7 million in new startup capital and major equipment costs in the first five years

• Funded through existing incorporation and capital reserve funds

•Police/Municipal Court facility anticipated to be partially funded through incorporation reserve funds

• In addition to $14.4 million in law enforcement expenses currently included in Township’s 5-year plan

Law Enforcement Cost Summary

55

Infrastructure/

Public Works

• Extensive engagement with current County providers

• Comprehensive assessment of existing pavement condition › Field condition survey of every

Township street

• Developed a Pavement Condition Index (PCI) value for each segment of roadway• 95 PCI for Concrete

• 64 PCI Asphalt

• Performed 5-year budget analysis to determine investment needs under multiple PCI scenarios

56

Infrastructure – HR Green Pavement Study

• Board voted to apply $1.25 million over five years to bring all concrete and

asphalt pavement to excellent condition

• Maintains Excellent PCI rating for concrete roads and brings asphalt road

to Excellent PCI

• Board voted to dedicate the $1.25 million per year to a sinking fund in

Year 6 and beyond

• Board voted to include $50,000 per year in bridge deck maintenance

funding and $200,000 per year in shoulder maintenance funding

Infrastructure – HR Green Pavement Study

* Correction: Slide adjusted on 09/29/21 to reflect that the incorporation study initiatives for transportation infrastructure were not “unanimously” approved

by the Township Board of Directors. Director Ann Snyder voted no on the board decision package relevant to this incorporation initiative.

• TNCG/Raftelis developed Public Works operating and capital cost/start-up model

› Benchmark comparisons

› APWA industry guidelines

› Market-based land acquisition cost estimates

› Public cooperative purchasing agreements for heavy equipment

• Incorporation includes adequate funding to build an operations and maintenance department

58

Public Works

• Approximately $4.8 million in new annual operating costs for personnel, materials, supplies, and overhead

› Offset by new revenues and projected growth in existing revenue sources

• Approximately $10.2 million in startup capital and major equipment costs in the first five years

› Funded through existing incorporation reserve funds

• In addition to approximately $5.9 million currently dedicated to streetscape maintenance

59

Public Works Cost Summary

• HR Green completed an assessment of MUD service consolidation model options under incorporation

1. Maintain current model of 11 independent MUDs providing water, wastewater, and stormwater management services

2. Integrate all MUDs under one consolidated property tax rate

3. Integrate all MUDs under a user-fee model, eliminating MUD property tax rates

• Board unanimously voted to maintain current structure under the incorporation model

• Future City Councils may consider MUD consolidation options

60

Municipal Utility Districts – HR Green Study

61

General Government

• Incorporation will require additional administrative and general government support as well

• TNCG/Raftelis applied benchmark data to estimate staffing needs under incorporation

• Some, such as City Secretary and risk management, are already accounted for in Township budget

• Others, such as municipal court and building permitting, will be added under incorporation and would be revenue neutral

• Property tax freeze for disabled/senior citizens

62

General Government

63

Tax Rate Impact

• Township applied incorporation study initiatives to the adopted 5-year plan

• Reflects probable revenue growth

• Results in no increase in the maximum tax rate

• TNCG/Raftelis validated with Township Finance Director to review findings

• Approach reflects sound financial management practices and historical commitment to financial management best practices

64

General Government

• Approximately $16.8 million in new annual expenses plus continuation of $133.7 million in annual expenses currently funded by the Township

• Approximately $19.9 million in capital costs related to Public Works and Law Enforcement in the first five years

• Funded through existing incorporation and capital reserve funds

• Police/Municipal Court facility anticipated to be partially funded through incorporation reserve funds

• Incorporation initiatives approved by the Board can be implemented with no impact on maximum tax rate, based on projected revenue growth

• The maximum initial tax rate is $0.2231 per $100 valuation

• Reflects Township’s current rate and will be maintained for 5 years based on current Five-year Plan

65

Financial Impact Summary

66

Incorporation Impacts

Incorporation Impact

67

Township Law Enforcement City

• Transition agreements allows smooth transition to local control by a City police department with a singular policing philosophy, consistent level of service

• Provided by two counties; 104 positions currently funded by Township

Incorporation Impact

68

Township ROW Management, Road Planning, Maintenance and Speed Limits

City

• Local Control by City

• Determined by Harris and Montgomery Counties

Incorporation Impact

69

Township Community Ordinances

• Such as Fireworks, Noise and Parking

City

• Local Control by City

• No Authority

Incorporation Impact

70

Township Development, Planning and Tree Preservation

City

• Local Control by City

• Dependent on developers, and Cities of Houston and Conroe

Incorporation Impact

71

Township Drainage and Flooding City

• Can establish and enforce drainage standards

• No Authority

Incorporation Impact

72

Township Access to State and

Federal Funding

City

• Eligible for a greater share of funding

• Eligible in limited situations

Incorporation Impact

73

Township What Doesn’t Change

• School Districts

• Unpaid local officials

• Local Tax Rate

City

• Independent Jurisdictions

• No Change

• $0.22331/$100 of valuation –tax rate can be frozen for disabled residents and those over 65

• Independent Jurisdictions

• No Change

• $0.22331/$100 of valuation

Incorporation Information

• The November Election section of the Township Website

› Exact wording of the Incorporation propositions

› Candidate names in ballot order for the Directors election

› Voting information, and more

› www.thewoodlandstownship-tx.gov/NovemberElection

• Incorporation Study website

› Comprehensive information on the study, including reports, FAQs, videos, and more

› www.thewoodlandsincorporationstudy.com

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Topical Area Q&A

• Four Stations for Small Group Questions and Answers

• Self-Governance/Transition

• Infrastructure/Public Works

• Finance/Cost of Service

• Law Enforcement

• Opportunity to engage in small group discussions and Q&A with consultants and Township staff

• You will have the opportunity to go to three of the four break out areas

• We will rotate groups after 10/15 minutes

• Overview of questions will be reported back to large group

• Purpose is inquiry and understanding 76

Topical Area Q&A

77

Thank you!