Fredericksburg City Council Regular Meeting - January 6, 2026

The Fredericksburg City Council met on January 6, 2026 at 9:00 AM at New City Hall. The meeting included an invocation, pledges, council comments, consent agenda approval, a quarterly update from the Convention & Visitor Bureau (CVB), a funding request for the 2026 Food & Wine Festival, acceptance of a Zoning Board of Adjustment resignation, annual department updates from Development Services, Public Works, Parks, Health, and Finance, and a future agenda review. The council also convened in executive session for personnel and real estate matters.

Consent Calendar

• Approved the minutes from the December 9, 2025 Special Joint Meeting with CVB Board, December 9, 2025 Special City Council Meeting, and December 16, 2025 Regular City Council Meeting. (Motion passed unanimously)

Public Comments & Testimony

• No public comments were made during the meeting.

Discussion Items

6A. Fredericksburg Convention & Visitor Bureau (CVB) Quarterly Update

• David Shields (CVB Board President) read the CVB mission statement and provided an update on the CEO search: first major screening January 23, candidate review February 4, virtual interviews February 18-19, all-day interviews March 4, with potential hire in April.
• Jesse Bard (CVB Board) highlighted that Gillespie County had $190 million in direct travel spending in 2024, and the CVB provided a $57 return in direct visitor spend for every $1 spent on marketing. He noted that a $1 million reduction in funding would equate to a $57 million loss to the local economy.
• The CVB requested: (1) adoption of a three-year annual budget, and (2) return of $1 million to the operating budget to restore it to $5.3 million for the fiscal year. The council had previously withheld $1 million from the CVB budget, directing it toward historic preservation and arts funding.
• Karen Mayo (VP Sales) explained that the $1 million was not new spending; it was a parking place for funding already designated. The CVB used reserve funds ($250,000 for county reserve and $250,000 for a fall campaign) to maintain operations. CVB reserves are approximately $4.5 million.
• Councilmember Klein asked about county funding; CVB reported positive conversations with Judge Jones about increasing HOT tax enforcement collection.
• Councilmember Watson questioned the CVB's ability to pull from reserves to reach $5 million. CVB stated that while possible, a three-year funding commitment would allow them to reduce reserves and attract a higher-caliber CEO. The board noted that some candidates declined due to the budget size.
• Councilmember Kirchner asked about gaps in tourism and initiatives. Jesse Bard emphasized that spending per visitor is down nationally; the CVB's marketing focuses on heritage, arts, and culture (over 90% of ads touched heritage/arts). The CVB is the marketing agent for small businesses.
• No vote was taken on the CVB's funding request; the update was informational.

6B. Consider approving a Request for Funding for the 2026 Food & Wine Festival

• Jim Mikula (Chamber of Commerce) requested $219,000 total ($185,000 base plus $34,000 for a culinary week expansion, including a national PR campaign). The item had been tabled from December 16, 2025.
• The additional $34,000 breakdown: $10,000 for CBS Austin (long-form videos and live interviews), $1,000 for an outside PR firm, digital advertising, influencers lodging, print ads, photography, and graphic design. An additional $21,000 would go toward a national PR firm (not yet selected) and travel for journalists.
• Councilmember Klein expressed concerns about public benefit, volunteer use, and the lack of giveback to nonprofits or Market Square redevelopment. He noted that the chamber uses paid staff rather than volunteers and that the city previously ran the event with volunteers and funds directed to Market Square.
• Mikula stated that 20-28% of attendees in 2025 had household incomes over $200,000, and the festival attracted a high-net-worth demographic. He also noted the five-year agreement allows for giveback in years 4 and 5, and they are considering funding a catering kitchen for Market Square.
• Councilmember Watson asked about coordination with CVB; Mikula acknowledged overlap and expressed willingness to explore working with CVB's PR firm (Geiger).
• Motion to approve $219,000 passed 3-1 (Councilmember Klein voted no).

6C. Accepting Zoning Board of Adjustment Resignation(s) and Appointing Replacements

• The council accepted the resignation of Taylor Williams from the ZBA (motion passed unanimously). Replacement appointments were discussed in executive session.
• After executive session, the council approved appointing Adam Lewis to fill Williams' term and appointing Jimmy Colt to the alternate position vacated by Lewis. (Motion passed unanimously)

7. City Manager’s Report – Annual Department Updates

• Development Services (Cliff Cross): Reported 16 zoning cases processed (14 approved, 2 tabled), 7 Board of Adjustment cases, 15 Historic Review Board cases (14 approved initially, 1 denied then approved on revision), 83 plan reviews, 9 commercial permits ($288,840 revenue), 53 residential permits ($365,311 revenue), 587 inspections (25 failed initially, later resolved). Short-term rentals now at 1,008 active, generating ~$211,025 in Q3. Subdivisions: Sonoma Oaks nearing build-out, Friendship Oaks phases progressing, Trails at Windcrest infrastructure beginning. Future: unified development code RFQ received 13 responses; fee structure and ordinance amendments expected by February 2026.
• Public Works (Chris Kneese): Electric: rehabbed underground primary in Sandcastle, continued overhead line removal on Main Street, completed infrastructure GIS survey, added 5 new commercial customers. Sanitation: completed cells 12/13 at landfill (including customer convenience center and grit trap), replaced all Main Street trash receptacles, applied for $4.8M ACOG grant. Solid waste deposited: 37,000 tons in 2025 (down 3,600 tons from 2024 due to rate increases). Recycling operates at a loss (~$60-70k/year). Streets: paved 9.5 miles, accepted 1.1 miles of new roads, assisted with parking lot at Ladybird and Totch House. Water: completed Homing Lane lift station, 2-inch main replacement on East College Street, West Live Oak water/sewer extension, standby generators installed. Water pumpage trends down despite growth. Aquifer levels rebounded after 2025 rainfall.
• Parks (Andrew Schmidt): Capital improvements: specialized equipment purchased, pool plaster repair (mostly warranty), annual Christmas lights lease at Market Square now seasonal (up Nov-Jan). Reservations at Market Square indoor facilities ~500 (up), Totch House slightly down, Pioneer Pavilion up. Pool use: Park Pool and Town Pool near capacity. RV park occupancy at 39% (down from COVID peak). New recreation superintendent hired.
• Health Department (Kelly Olfers): 317 fixed food establishments (up from 308 in 2024), 64 mobile food units (down from 70). 330 temporary health permits issued for special events. Routine inspections increased by 100 due to third inspector. Child care: 8 facilities inspected. School environmental health inspections: Fredericksburg ISD (5 campuses), Harper, and Doss Consolidated – although no longer required by TEA, department continues them. All staff now accredited sanitarians. New software improved inspection efficiency and public reporting.
• Finance (Carla Wareham): 2025 revenues at 101% of budget (sales tax, interest, development fees strong); expenses at 90% (salary savings, timing of City Hall costs, delayed stormwater project). General fund reserves $9 million. Structural balance at risk by 2029 due to personnel costs (60% of recurring) growing faster than revenues. 2026 budget raised property taxes to voter approval rate and added $530,000 in revenue compression relief. Sales tax: 2025 finished at $9.6M; 2026 through December at $2.3M. HOT tax: on track for $6M budget. Electric and water revenues trending as expected.

8. Items for Future Agenda

• City Manager Bailey reviewed upcoming items: January 20 meeting with Fire, EMS, PD, and Municipal Court updates; ordinance on community room use/fees; evaluations of city manager and judge; ordinance on horse-drawn carriages; July 4th and other event requests. February: sound ordinance, solicitor permits, animal control fees, SOB ordinance amendment. Special meeting January 13 for HOT funding applications.

Key Outcomes

• Consent agenda (minutes) approved unanimously.
• Food & Wine Festival funding approved $219,000 (3-1 vote, Klein opposed).
• ZBA resignation accepted; Adam Lewis appointed to fill term, Jimmy Colt appointed as alternate (both approved unanimously).
• All department updates received and discussed; no formal votes taken on those presentations.
• Council will meet again January 13 (special) and January 20 (regular).