The Lampasas City Council on Monday unanimously approved the first reading of an ordinance to annex 224 acres along Farm-to-Market Road 580 West and 141 acres along U.S. Highway 281 South.

The annexation will bring into the city limits property on both sides of FM 580 West near the new sports complex, as well as land -- primarily on the west side of U.S. 281 -- near the new high school campus. Except for a few properties, most areas on the east side of U.S. 281 south of the current city limits will not be affected.

Council members will vote June 28 on the second reading of the annexation ordinance.

In other business, the council voted 6-0, with Councilman Brad Neely abstaining, to authorize City Manager Michael Stoldt to sign three contracts with the Texas Department of Transportation. The three contracts relate to the relocation and/or improvement of water and wastewater utilities on Key Avenue and Fourth Street.

After the approval of contracts, city staff expect to receive a reimbursement of $443,894 from TxDOT for engineering expenses associated with the Key Avenue and

annexation

Fourth Street projects. After receiving the reimbursement, the city will have a budget deficit for the road projects of about $100,000. Funds to eliminate the deficit could come from reserves or from the May 2011 debt issue, according to Stoldt’s report for the City Council.

In a related matter, the council voted 7-0 to add $2,200 to the city’s contract with Schneider Engineering of Boerne for electrical engineering design in connection with the Key Avenue/Fourth Street project. The extra expense is required by TxDOT to fund additional tasks within the project and to complete the city’s eligibility for engineering reimbursement.

Construction on Key Avenue/ Fourth Street is not scheduled to begin until 2012, Stoldt said in his report.

Also Monday, the City Council approved the second reading of an ordinance that amends the local zoning ordinance.

Minimum side yard and rear yard setbacks have been reduced, which city officials hope will spur development.

The change was necessary, offi- cials said, because many city lots that are zoned for retail use do not meet minimum lot widths. Because of current setback mandates, nothing can be built unless adjoining property is available, officials said.

The second reading passed by a 6-1 vote. Councilman John Cole cast the “no” vote.

In other business, the council voted 7-0 to write off as “uncollectible” $19,162 in overdue bills that have not been paid to the city. A collection agency will handle the delinquent accounts and will receive 30 percent of the debt collected, Finance Director Terry Knudsen said.

In a related matter, the council voted unanimously to write off $906.89 in checks to Hancock Park Golf Course that were returned for non-sufficient funds. Some of the checks date back to August 1996.

Also Monday, the council approved agreements to resolve two instances of encroachment on public rights of way. The council voted 7-0 to approve a license agreement with First Texas Bank for property at 107 N. Key Ave., where a onestory metal commercial building encroaches 2.1 feet onto city right of way on the East Avenue A side. The agreement names the bank as the license holder and allows for the continuing encroachment by the commercial building.

The council also voted unanimously to approve a license agreement with Thomas Teer and John Teer for property at 1103 S. Willis. The license allows an existing residential carport to continue encroaching by 1.76 feet onto an unopened, unimproved and unnamed public right of way that runs through the Teer brothers’ property.

In addition, the council authorized Stoldt to sign an agreement that will guarantee the city an additional $5,303 of grant funds from the State Energy Conservation Office.

The council also approved several expenditures, including:

• a maximum of $40,000 for seal coat rock purchased from Alexander Trucking for $39.60 per ton.

• no more than $25,000 for 100LL fuel purchased from Ann Arbor, Mich.-based AvFuel for the Lampasas Municipal Airport.

• $20,741 for 97 utility poles that will be purchased from Colfax Treating Co. of Pineville, La.

• $15,185 for 25 Kenwood vehicle/ equipment radios and 18 Kenwood handheld radios.

• $9,500 for the replacement by Lancaster Plumbing of a wastewater line in the alley behind the addition to the Lampasas County Office Building.

• $8,240 for two digital in-car police cameras and related equipment.