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Home My WebLink About03659 ORD - 02/17/1954ORDINANCE N0. 3659 Providing that in the event of sale of City Waterworks System under Deed of Trust securing City's First Mortgage Waterworks Revenue Refunding Bonds that purchaser thereof shall be entitled to a franchise to operate such System for a period of 20 years from the date of such purchase; and ordaining other matters relating to the subject. WHERF S, in order to provide further security for the payment of City of Corpus Christi First Mortgage Waterworks Revenue Refunding Bonds, dated December 1, 1953, aggregating $3,831,000.00, the City and the Mercantile Nation$ Bank at Dallas, as Trustee, execute{a Deed of Trust dated December 1, 1953, upon the physical properties of the System and among other provisions said Deed of Trust grants a franchise to the purchaser at a sale thereunder (in event of default is payment of such bonds) to operate such Waterworks System for a period of 20 years from date of such sale; and WHERE, the laws of Texas under which said above described bonds are issued expressly authorizes the granting of such franchise for such period of time as additional security for the payment of said bonds; and WHEREAS, Section 18, Article II of the Charter of the City provides that when an ordinance is introduced proposing to grant a franchise, such ordinance as proposed to be passed shall be published in the official newspaper once a week for three consecutive weeks; and WHEREAS, the City Council deems it proper that an ordinance be passed confirming the grant of franchise in event of sale under said Deed of Trust and fixing the rights, powers and privileges granted and to be granted thereby; BE IT CRDAINED BY THE CITY COUNCIL OF THE CITY CF CCRPUS CHRISTI, TMM: 1. (a) That in the event of a sale of the properties encumbered by the Said Deed of Trust in order to enforce the payment of the bonds secured thereby, the City of Corpus Christi herein and hereby grants to the purchaser or purchasers at any such sale which may be so held under the provisions of such Deed of Trust the right, privilege and franchise to operate the properties and facilities so purchased for a term of twenty years dating 3C�5c1 from such purchase, subject to all laws regulating as= then in force, as is provided in Article 1111, Texas Revised Civil Statutes of 1925, as amended, it being the intent hereof to grant a franchise which shall become operative and effective only in the event that said mortgaged properties are sold under the provisions of said Deed of Trust. (b) The granting of this franchise, which shall become effective and operative only after sale under said Deed of Trust, is supported by an adequate consideration, including: the acceptance of the Trust by the Trustee, the money paid to the City by the Trustee upon execution of said Deed of Trust, and the acceptance by the holders of the outstanding refundable bonds of such Waterworks Revenue Refunding Bonds. The grantee of this franchise shall pay annually to the City while such franchise is operative and effective a fixed charge of Five ($5.00) Dollars, on such date or dates as shall be prescribed by the City when the franchise becomes operative and effective. (c) When the right to this franchise shall have become vested because of the purchase of the encumbered properties pursuant to sale under said Deed of Trust, the purchaser of such properties, by filing a written acceptance: of this franchise with the City Secretary of the City of Corpus Christi shall be the grantee of such franchise. (d) In the event that the holder of the franchise shall at any time fail to comply with reasonable rates for services theretofore established by the City, or shall fail or refuse to render ef£.'.cient service to the public, or to maintain such properties in good order throughout the period of the grant, and shall continue in such failure or refusal for a period of 120 days after written notice by the City of such violation, the City shall be authorized to institute proceedings in a court of competent jurisdiction to enforce compliance with such rates, rendition of such service or to effect such proper maintenance as the case may be, or in the alternative for the forfeiture of the franchise, provided that so long as the validity of any such rate or requirement by the City shall be questioned in good faith by such holder through litigation in a court of competent jurisdiction, the City shall not be authorized to institute such proceedings. (e) Upon the termination of the grant of the franchise, the City upon the payment of the fair valuation thereof shall have the right to acquire all of the properties which shall have been operated under such franchise; provided that such grantee shall not be entitled to any payment or valuation because of any value derived from the franchise or the fact that it is or may be a going concern duly installed and operated. The fair valuation of such properties shall be determined in the following manner: Upon determining to propose to purchase such properties the governing body of the City (at this time called the "City Council ") shall adopt a resolution showing such intention and shall deliver to the holder of the franchise a certified copy of such resolution. In the resolution the City Council shall appoint an appraiser sho shall be an engineer skilled in the appraisal of waterworks properties, and the holder of such franchise shall within 30 days after receiving a copy of such resolution appoint another engineer skilled in the appraisal of waterworks properties, and the two engineers thus appointed shall select a third engineer having like qualifications. The three engineers thus selected shall serve as the Board of Appraisement. Such Board sW 1 take such steps as it may deem proper to determine the then fair valuation of such properties and by a majority vote shall determine such valuation. In the event that the holder of such franchise shall fail or refuse to appoint an appraiser within 30 days after receiving the copy of such resolution, the appraiser selected by the City may proceed to determine such valuation. And if the two appraisers first selected shall be unable to or fail to select a third appraiser within 30 days after the second appraiser shall have been selected, the two appraisers shall proceed to determine such valuation. The valuation thus fixed shall be binding upon the parties and shall be considered the price at which the City shall have the right to purchase said properties. If such right is not exercised finally within 6 months after the filing with the respective parties of a copy of said report the right thus to purchase the properties shall no longer be vested in the City and the holder of such franchise upon its expiration shall have the right to remove or otherwise dispose of said properties in the event that a renewal of the franchise is not granted by the City, but shall be responsible to the City for prompt restoration of any part of the streets or alleys damaged through such removal. 2. THAT THE CITY SECRETARY BE AND HE IS HEREBY DIRECTED TO CAUSE A COPY OF THIS PROPOSED ORDINANCE TO BE PUBLISHED ONCE A WEEK FOR THREE CON- SECUTIVE WEEKS IN THE OFFICIAL NEWSPAPER OF THE CITY. 3• THAT THE FOREGOING ORDINANCE WAS ' READ FOR THE FIRST TIME AND PASSED TO ITS SECOND READING ON THIS THE q DAY OF FEBRUARY, 1954, BY THE FOLLOWING VOTE: A. A. LICHTENSTEI IJ ELLROY KING � P. C. CALLAWAY JAMES S. NAISMITH W. JAMES BRACE THAT THE FOREGOING ORDINANCE WAS READ FOR THE SECOND TIME AND /& FEBRUARYS 1954. PASSED TO ITS THIRD READING ON THIS THE DAY OF ,A. A. LICHTENSTEIN ELLROY KING 4 F. C. C %',CLAW AI' JAME5 S. NAISMITH W. JAMES BRACE THAT THE FOREGOING ORDINANCE WAS READ FOR TH THIRD TIME AND PASSED FEBRUARY, 1954, BY THE FOLLOWING VOTE: FINALLY ON THIS THE T /GK AY OF A. A. LICHTENSTEIN ELLROY KING P. C. C /LLAWAY JAMES S. NAISMITH W. JAMES BRACE PASSED AND PPROVED, THIS THE ` /(/� VAY OF FEBRUARY, 1954. MI\70R ATTESTS T CITY OF CORPUS CHRISTI, TEXAS I J CITY SEC E ' RY APPROVED AS TO EGAL FORM: A e9 CITY ATTORNEY