HomeMy WebLinkAboutMinutes City Council - 12/03/1987 - SpecialPRESENT
Mayor Betty Turner
Mayor Pro Tem Mary Rhodes
COUNCIL MEMBERS:
David Berlanga, Sr.
Clif Moss
Bill Pruet
Linda Strong
Absent
Leo Guerrero
Mary Pat Slavik
MINUTES
CITY OF CORPUS CHRISTI, TEXAS
SPECIAL COUNCIL MEETING
CITY HALL COUNCIL CHAMBERS
DECEMBER 3, 1987
11:30 A.M.
City Manager Craig McDowell
City Attorney Hall George
City Secretary Armando Chapa
Mayor Betty Turner called the meeting to order in the Council Chambers of
City Hall.
City Secretary Armando Chapa called the roll and verified that the
necessary quorum of the Council and the required Charter Officers were present
to conduct the meeting.
Mayor Turner called for consideration of the General Improvement and
Refunding Bonds, Series 1987.
Assistant City Manager Juan Garza introduced representatives from McCall,
Parkhurst, & Horton, Bond Counsel; Mr. James Seal, representative of M.E.
Allison & Co.; and representatives from Texas Commerce Bank and Dean Witter
Capital Markets who were present for the sale of bonds. Mr. Garza continued by
stating that the proposal is to approve the sale of General Improvement and
Refunding Bonds, Series 1987, in the amount of $40,200,484.55.
Mr. Garza continued by stating that the projects included in the sale of
bonds are those recommended by the bond task force and the construction of the
Police building and improvements to the communication system. He explained that
the refinancing provides the flexibility for next year in that the City can use
the cash flow generated to sell more bonds, use the money for replenishing the
reserves, add to the general fund or any other financing in accordance with the
truth in taxation law. Assistant City Manager Garza explained the two
ordinances and two resolutions that need to be approved by the City Council in
order to complete the sale.
MICROFILMED
cial Council Meeting
December 3, 1987
Page 2
Mayor Turner asked Mr. Garza to explain the specific projects that would be
funded from the sale of bonds.
Mr. Garza explained that the following specific purposes are included:
Drainage and Storm Sewers - $500,070; Aquarium - $2,700,000; Public Health and
Safety - $6,600,000; Airport - $400,000; Parks and Recreation - $1,100,000;
Street Improvements - $3,330,000; and Library books - $250,000. He noted that
the funds for street improvements will be matched by State funds.
Mayor Turner expressed the opinion that there is a need to move forward
with these projects as soon as possible. She then referred to a letter received
from the Taxpayers Association indicating that they are concerned about the
proposed refunding of over $23,000,000 of 1985 General Improvement Bonds which
they feel is a violation of the City Charter, since Article VIII, Section 2(b)
requires that the refunding be approved by the voters of the City. She inquired
if this needs to be referred to the Attorney General.
Mr. Hobby McCall stated that the procedures proposed are legal, stating
that they have discussed this with the Attorney General's office and they are in
agreement that the part of provision requiring an election would not apply in
this situation. He assured the Council that this is a legal procedure.
City Manager McDowell pointed out that Mr. McCall's firm is one of the most
outstanding in the State in dealing with bonds, and he had no hesitation in
recommending the approval of the ordinances.
Mayor Turner then inquired if Mr. Seal concurred, and Mr. Seal assured the
Council that the agrees with Mr. McCall that this is a legal and proper
procedure.
Mayor Pro Tem Rhodes asked for City Attorney George's opinion, because she
was under the impression that when local law is more restrictive than State law,
it usually supersedes state law, and she wanted to be sure that these procedures
are legal.
Mr. McCall explained that the issue is based on the Texas Constitution and
the test is whether the local law is consistent with State law. He explained
that in this case, the language is inconsistent with State law; therefore, it
must fall under the State Constitution.
Mayor Turner then referred to the Tax Cap included in the City Charter
which is different from the $2.50 per $100 of valuation maximum allowed by State
law.
Mr. McCall explained that the terms of the City Charter cannot be
inconsistent with State law.
Mayor Turner then inquired if other cities in the State have refunded
bonds, and Mr. McCall stated that this has been done in Dallas, San Antonio and
Austin.
ecial Council Meeting
liecember 3, 1987
Page 3
Mr. Garza informed the Council that the bonds have already been sold, and
they were completely sold because Corpus Christi has popular bonds.
Mr. McDowell then distributed to the Council copies of a comparison of
bonds sold by other entities. He noted that this City's rating was reduced to
AA- and A.1. He then referred to the tax rate and presented the schedule on the
refunding which shows that the tax rate will remain at its present level with
the exception of the two cent increase which was authorized by the City Council.
Mr. McDowell continued by stating that the City was informed in writing by
the rating agencies that the City's ratings were reduced somewhat because of the
tax cap which was a major factor; the exemption on homesteads for citizens over
65 years of age which was approved in April, 1987; and the general economic
conditions. He explained that on the positive side, the sound and progressive
operation of the City was one factor; the coming of Homeport was another factor;
and the success of the Port of Corpus Christi. He noted that the Council is
seeing for the first time written into the credit report those specific issues,
and had the detrimental issues not been in effect, the rating would not have
been adjusted. He noted also that there is a possibility of these factors
costing the City more money in the future.
Mayor Turner called for comments from the audience.
Mr. J. E. O'Brien, 4130 Pompano, explained that the letter from the
Taxpayers Association was written because of the City Charter. He stated that
he does have a difference of opinion with Mr. Hobby McCall; this City's Charter
was just recently approved; the Council should pay attention to what is included
in the City Charter. He questioned if the City staff could do anything right,
and if there is a conflict between the State law and City Charter, this should
have been addressed when the Charter was revised. He also questioned the
emergency to pass ordinances in order to sell bonds.
Mr. McDowell stated that it was his understanding that the charge to the
Charter Revision Commission was to simplify the Charter - not make major
amendments to the Charter. He explained also that the emergency deals with the
effective administration of the City and the need to move forward with the
Police Station Building.
Mr. Garza also pointed out that the underwriters would not be willing to
wait three weeks for three readings of the ordinances.
Mr. Philip Rosenstein, 949 Bobalo, stated that he is not opposed to
projects proposed, but he is against doing things that will cost the taxpayers
money. He questioned the reason the City Attorney does not give legal opinions
but rather allows other attorneys to provide the legal opinions. He expressed
the opinion that the citizens have a right to know how much it is going to cost
the taxpayers and noted that refinancing always costs the taxpayers more.
Mr. Raymond Hasker noted that there are very few voters present and
questioned the reason for calling a Special Council Meeting. He inquired as to
what constitutes an emergency and questioned adhering to the State laws rather
than the City Charter which was approved by the citizens of Corpus Christi. He
stated that any time these special meetings are called, the public should be
informed.
ecial Council Meeting
.,ecember 3, 1987
Page 4
Mayor Turner informed him that this meeting was discussed at a previous
Council meeting, and Mr. McDowell explained that notice of the meeting was
posted last week and it was discussed at the Council Meeting on November 17,
1987. Mr. Garza pointed out that it is not an emergency meeting; the emergency
is to pass the ordinances in order to sell the bonds.
Mr. Bob Hallet of Texas Commerce Bank stated that the reason the special
meeting was called was to take emergency action to take advantage of market
conditions. He stated that the reason is that one cannot ask bond holders to
hold bonds for a long period of time. He pointed that other cities, and even
the State of Texas, conduct special meetings for this purpose.
Mayor Turner then called for consideration of the resolutions and
ordinances.
City Secretary Chapa polled the Council for their votes and the following
Resolution was passed:
1. RESOLUTION NO. 20097
APPROVING THE FORM OF THE OFFICIAL STATEMENT PERTAINING TO CITY OF CORPUS
CHRISTI, TEXAS GENERAL IMPROVEMENT AND REFUNDING BONDS, SERIES 1987, AND
AUTHORIZING, RATIFYING AND APPROVING THE OFFICIAL STATEMENT AND THE USE
THEREOF IN THE OFFERING AND SALE OF SAID BONDS, AND DECLARING AN EMERGENCY.
The foregoing Resolution passed by the following vote: Turner, Berlanga,
Moss, Pruet, Rhodes and Strong voting "Aye"; Guerrero and Slavik absent.
City Secretary Chapa called for consideration of the ordinance and informed
the Mayor that there was a need to have a motion to suspend the Charter Rule and
pass the ordinance on emergency.
A motion was made by Council Member Strong that the Charter Rule be
suspended and that the ordinance be passed on an emergency. The motion was
seconded by Council Member Pruet and passed unanimously.
2. ORDINANCE NO. 20098
AN ORDINANCE PROVIDING FOR THE ISSUANCE OF $40,200,484.55 GENERAL
IMPROVEMENT AND REFUNDING BONDS, SERIES 1987, OF THE CITY OF CORPUS
CHRISTI, TEXAS, BEARING INTEREST AT THE RATES HEREINAFTER SET FORTH, AND
PROVIDING FOR THE LEVY, ASSESSMENT AND COLLECTION OF A TAX SUFFICIENT TO
PAY THE INTEREST ON SAID BONDS AND TO CREATE A SINKING FUND FOR THE
REDEMPTION THEREOF AT MATURITY; REPEALING ALL ORDINANCES IN CONFLICT
HEREWITH; DECLARING AN EMERGENCY; AND ALL OTHER MATTERS RELATED THERETO.
The Charter Rule was suspended and the foregoing Ordinance passed by the
following vote: Turner, Berlanga, Moss, Pruet, Rhodes and Strong voting "Aye";
Guerrero and Slavik absent.
ficial Council Meeting
uecember 3, 1987
Page 5
A motion was made by Council Pruet that the Charter Rule be suspended and
that the following be passed on an emergency. The motion was seconded by
Council Member Strong and passed unanimously.
3. ORDINANCE NO. 20099
AUTHORIZING AN ESCROW AGREEMENT BETWEEN THE CITY OF CORPUS CHRISTI, TEXAS
AND FIRST CITY BANK OF CORPUS CHRISTI, AN ESCROW AGENT, AND OTHER MATTERS
PERTAINING THERETO.
The Charter Rule was suspended and the foregoing Ordinance passed by the
following vote: Turner, Berlanga, Moss, Pruet, Rhodes and Strong voting "Aye";
Guerrero and Slavik absent.
4. RESOLUTION 20100
CALLING CERTAIN BONDS FOR REDEMPTION PRIOR TO SCHEDULED MATURITIES.
The foregoing Resolution passed by the following vote: Turner, Berlanga,
Moss, Pruet, Rhodes and Strong voting "Aye"; Guerrero and Slavik absent.
City Manager McDowell referred to the attachment explaining the fifth
ordinance which was to amend the budget to authorize the sale of bonds and to
increase the total expenditures from $209,765,733 to $211,037,667. He stated
that this amendment was necessary because of the approved Bond Sale.
City Secretary Chapa polled the Council for their votes and the following
ordinance was passed:
5. ORDINANCE 20101
AMENDING ORDINANCE NO. 19891 PROVIDING FOR THE ADOPTION OF THE CITY OF
CORPUS CHRISTI FISCAL YEAR BUDGET BEGINNING AUGUST 1, 1987 AND ENDING JULY
31, 1988; APPROPRIATING MONIES IN CONFORMITY WITH THE AMENDMENTS TO SAID
BUDGET; PROVIDING FOR SEVERANCE; AND DECLARING AN EMERGENCY.
The Charter Rule was suspended and the foregoing Ordinance passed by the
following vote: Turner, Berlanga, Moss, Pruet, Rhodes and Strong voting "Aye";
Guerrero and Slavik absent.
There being no further business to come before the Council, on motion by
Council Member Strong, seconded by Mayor Pro Tem Rhodes and passed unanimously,
the Special Council Meeting was adjourned at 12:16 p.m., December 3, 1987.
I HEREBY CERTIFY that the foregoing is a true and correct copy of the
Minutes of the Special Council Meeting of the City of Corpus Christi of December
3, 1987, which were approved by the City Council on December 8, 1987.
WITNESSETH MY HAND AND SEAL, this the day of/ _ J
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etty Tur r, MAYOR
Armando Chapa, City Secrethry
City of Corpus Christi