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HomeMy WebLinkAboutMinutes City Council - 10/29/1996I HEREBY CERTIFY that the foregoing is a true and correct copy of the minutes of the Regular Council Meeting of the City of Corpus Christi of October 29, 1996, which were approved by the City Council on November 12, 1996. WITNESSETH MY HAND AND SEAL, this 12th day of November, 1996 Armando Chapa City Secretary SEAL *0°. MINUTES CITY OF CORPUS CHRISTI, TEXAS Regular Council Meeting October 29, 1996 2 p.m. PRESENT Mayor Mary Rhodes Mayor Pro Tem Tony Heldenfels Council Members - Dr. Jack Best Betty Black Melody Cooper Betty Jean Longoria John Longoria Edward Martin Dr. David McNichols City Staff: City Manager Bill Hennings City Attorney James R. Bray Jr. City Secretary Armando Chapa Mayor Rhodes called the meeting to order in the Council Chambers of City Hall. The invocation was delivered by Council Member Best, following which the Pledge of Allegiance to the flag of the United States was led by Council Member McNichols. City Secretary 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 Rhodes called for approval of the minutes of the regular Council meeting of October 22, 1996, and there being no corrections, she proclaimed them approved as presented. * * * * * * * * * * * * * The Mayor announced that there would be two presentations. Council Member Black discussed the "Founder's Walk" (Volkswalk), which will be held November 2, 1996 beginning at the Sandy Shores Hotel on North Beach and culminating at Fire Station No. 1 on Belden Street. She explained that the 8.5 -mile walk is sponsored by the Corpus Christi Downtown Management District and downtown merchants. Mrs. Black then introduced Mr. Greg Salvo, who described the event. He pointed out that there are areas of downtown that are not well known by the majority of citizens, and this event is designed to better familiarize them. Over 60 historical landmarks in the Chaparral/Mesquite/Upper and Lower Broadway area have been identified and will be pointed out during the walk and thereafter. Council Member Melody Cooper discussed the "Paint Out the Violence" event, which was Minutes Regular Council Meeting October 29, 1996 Page 2 held October 26, 1996. She introduced Dr. Rich Hammonds, Principal of the Student Learning and Guidance Center; Sgt. Charles Tryon, C.C.P.D.; and Mr. Michael Doddridge, of the Home Depot. Mrs. Cooper said over 100 volunteers assisted in painting out graffiti at 11 sites. She also thanked Whataburger Inc. for donating t -shirts for the event. * * * * * * * * * * * * * Mayor Rhodes referred to the Board and Committee appointments on the day's agenda, and the following appointments were made: Building Code Board of Appeals Bill Braselton Corpus Christi Minority Business Opportunity Steering Committee Benedicto Ramos (Reappointed) Abey Flores (Reappointed) Adelfino Palacios Lino Vera Art Maldonado B. David Royal Mary Helen Salazar Steven Gomez Diana Mendez Guadalupe Gomez John DeLuna Linda Roehl Mayor Rhodes opened discussion on Item 4, water rate ordinance. She explained that some minor changes were made and the Council would be voting on the amendments (Item 4.a.), but they would not vote on the second reading of the ordinance until November 12, 1996 (Item 4.b.). City Manager Hennings said the motion to amend corrects some erroneous numbers in the ordinance. Responding to Council Member McNichols, Mr. Hennings said the proposed ordinance "passes through" the cost of raw water. The remainder of the water rate is reduced to offset the raw water cost "passed through," so that the total effect is neutral. Dr. McNichols pointed out that commercial water rates were not being reduced per se; rather, the raw water component was being broken out from the treatment and distribution costs. Similar adjustments are being made to all rate classes. Mayor Rhodes called for comments from the audience on Item 4.a., and there were none. City Secretary Chapa polled the Council for their votes as follows: 4.a. M96-333 Motion amending by substitution the ordinance amending section 55-50 of the Code of Minutes Regular Council Meeting October 29, 1996 Page 3 Ordinances, City of Corpus Christi, regarding correction of revised water rates. The foregoing motion passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." Mr. Hennings referred to visual examples of utility bills to illustrate the pass-through approach. The first example was the bill of a single-family residential customer who uses 12,000 gallons of water a month. He noted that the example showed charges for gas use as well, which already incorporates the pass-through approach. The gas cost is broken down into two parts: gas basic service and fuel cost. Mr. Hennings said if the pass-through approach is adopted for water usage, it will be divided into two parts as well: water basic service and cost of raw water. Mr. Hennings continued that if approved, the ordinance would take effect January 1, 1997, and the bills that are distributed beginning in February would add one line showing the break down for raw water costs; however, the total monthly charge for the same amount of water consumption would remain the same. He referred to the customer bill example to discuss the incremental charges that are currently in effect, as well as the incremental charges and the break down for raw water costs using the pass through. Council Member Martin asked if the cost of raw water of 25¢ per 1,000 gallons indicated on the example was the actual cost that would be charged. He said there would be a different charge for inside city limits (ICL) customers than for outside city limits (OCL) customers if the cash utility system is utilized. Mr. Hennings explained that in order to calculate the cost of raw water beginning in January 1997, the actual costs of raw water for the month of November 1996 will be used; he said the 25¢ per 1,000 gallons is an estimation, and if the actual cost is different, the ordinance will have to be amended accordingly. Mr. Martin asked if the ordinance could be worded to indicate that the charge would be the rates currently in effect less the actual cost of water. Mr. Hennings agreed that that would be a better approach and the ordinance would be so worded. Mr. Martin then asked if the Council would review the approach used to determine the cost of raw water; Mr. Hennings said they would. Responding to a question from Council Member Heldenfels, Mr. Hennings said there were various reasons why the pass-through approach was being recommended, including some rate design considerations. Mr. Heldenfels said he thought that after the 6% utility rate cap was implemented and a proposed exemption to that cap was defeated by the voters, an agreement had been proposed between Council Member Martin and Mr. J.E. O'Brien that they would not challenge the pass- through of gas costs due to its volatility. He also objected to attempts at trying to equate gas and water. City Attorney Bray explained that the rationale for passing through water costs was not based on whether or not the gas pass-through was challenged. He said staff believes the Charter provision has been construed from the outset to allow pass-throughs, and there is not any basis within the Minutes Regular Council Meeting October 29, 1996 Page 4 Charter amendment itself to distinguish between gas and water. Mr. Heldenfels said that during the Charter amendment election on January 19, 1991, there was a proposed Charter amendment setting the 6% utility rate cap, which was approved by the voters; and another proposed amendment to exempt pass-through costs, which was not approved. Mr. Bray pointed out that the alternative proposal did not address pass-throughs alone but also addressed federal mandates and debt service. Mr. Heldenfels replied that he thought the ordinance was invalid. Council Member John Longoria asked if changes to the block rate structure for water costs would change customers' water bills, and Mr. Hennings said there were several separate issues the Council needed to consider: the pass-through approach for raw water costs; the increasing block rate for single-family residential customers; and the decreasing block rate structure for industries. Mr. Hennings added that the basic approach to rate design is that a rate is established to generate a set amount of revenue, and a certain amount is charged to each customer in the class. When the structure is changed, some customers within each rate class would pay more and others would pay less; it is revenue neutral. He said the cost of service study update showed that the single- family residential class was paying more than the cost of the water, so the Council could conceivably reduce the rates for the class as a whole to place the revenues back in line with the actual cost --that does not mean that any particular customer would receive an increase or a decrease if the structure was changed from an increasing block rate to a flat rate or some other approach. Mr. Longoria asked if changes to customers' water bills would occur if the Council votes to exercise the Garwood option. Mr. Hennings replied that it depends on how the Council exercises the option: if the option is exercised outright and the city pays the $15 million purchase price right away, that would be a current cost; but if the option is exercised conditionally, which he said is probably the better approach, the city would not make any payments other than option payments until the permit is granted, which could take a year or more. Council Member Best said he had been told that the 6% rate cap is probably unconstitutional but had never been challenged by the city, and Mr. Hennings replied that staff sent the Council members the bond counsel's opinion to that effect. Dr. Best then asked if there was any other way for the city to finance the pipeline (which he favors) other than the proposals made by staff. Mr. Hennings said he did not believe there was any other way to do so without some significant delay in the project, such as Charter revisions. Dr. Best then asked about possible legal challenges. Mr. Hennings said he and other city staff met yesterday with several bond attorneys, and they were all satisfied that the proposed financing mechanism is legal and would be upheld if it is challenged in court. Mr. Bray said it is possible for the issuer of the bonds, which in this case would be the Nueces River Authority, to file Minutes Regular Council Meeting October 29, 1996 Page 5 a declaratory judgement lawsuit to declare the proposed bonds and the contracts which support the bonds to be valid, and to have a judge address those issues. Mr. Hennings added that he expects the financing proposal to be legally challenged and that a court will need to rule on it. Mr. Martin said a committee had been actively discussing alternative financing of the pipeline, and they since have stopped once the pass-through approach was designed. He said there were other ways to finance the project that would not cause any delays --one such approach would be to eliminate declining block rates for industries, which would also not affect the 6% cap since the industries are located outside the city limits. He added that he was not suggesting that that approach be adopted. Upon verification by Mr. Hennings, Mr. Martin said that under the water pass-through proposal, customers would first see a change in methodology on their utility bill beginning January 1, 1997 before they would see any change in the cost for water. He then said that to the extent staff is maintaining that only the cost of service portion of water is subject to the 6% cap, staff is in fact lowering the cost of service portion by an amount that can never be regained, no matter what happens with the validation suit. He suggested that Mr. Hennings and Mr. Bray consider only passing through the cost of new water. Mr. Hennings again referred to the examples of utility bills to discuss what a water bill would be for a single-family residential customer using 12,000 gallons of water per month once the costs of the Texana and Garwood pipelines are included in about five years. The example showed an increase in the cost of raw water from 25¢ per 1,000 gallons today to 75.07¢ at that time, with a resulting increase in the total water bill from $24.33 today to $30.34 in the future (a 24% increase). He pointed out that the cost of treatment and distribution would remain the same ($21.33). The next example Mr. Hennings used was a large OCL refinery using almost 194 million gallons of water per month. He said that customer's current bill of $216,460 per month would increase to $313,567 once the cost of the pipelines are included (a 44% increase). The City Manager noted that 22% of the industrial customer's total usage is raw water, while only 12% of the single- family ICL customer's usage is attributable to raw water. Mr. Hennings then described the decreasing block rate structure for the example of the industrial customer. As with the ICL customer, the total monthly charge for the industrial customer will not change as a result of adopting a raw water pass-through approach. A brief discussion ensued about the impact of possibly eliminating the last "block" in the declining block rate structure. Mr. Hennings pointed out that there were some uncertainties relating to that idea. He said if it did occur, the city would have to have written commitments from the large water users indicating that the anticipated increase in their cost is fair and reasonable from their perspective and does not place them in an uncompetitive position. Mayor Rhodes asked if the large industrial customers had agreed to the pass-through approach, and Mr. Hennings said they had and Minutes Regular Council Meeting October 29, 1996 Page 6 he would ensure that their support was verified in writing. Dr. McNichols said the average residential customer uses about 6,000 gallons of water per month, which means their water bill, following the inclusion of costs for Texana and Garwood, would only increase $3 per month over current costs. He reiterated that the amount of customers' bills in January would remain the same as they are now (for the same consumption) if the pass- through approach is adopted --the difference would be in showing the break out of the raw water cost. Mr. Hennings concluded by saying that staff recommended that the vote on Item 4.b. be postponed until November 12, 1996. 4.b. POSTPONED * * * * * * * * * * * * * Mayor Rhodes opened discussion on Item 5, water transmission facilities contract. Mr. Hennings said staff was prepared to discuss the key issues of the proposed contract, but the vote would also be postponed until November 12. He said the agreement contained in the agenda materials was still in draft form and staff reviewed it yesterday with all the participants in the project. He said they expect to receive the final agreement next week. Mr. Hennings then referred to Article II of the proposal concerning the acquisition and construction of the project. He said the contract would provide that the Nueces River Authority (NRA) would acquire the right-of-way and build the pipeline to Lake Texana, while the Port of Corpus Christi Authority would be the project manager. He noted that the agreement calls for the city approving any acquisition of property, as well as approving the engineering contract, plans and specifications, and bid documents; such approval would be made by the City Manager. Mr. Carl Crull, Assistant City Manager for Public Works and Utilities, explained that the Port of Corpus Christi has entered into a letter agreement with HDR Engineering, pending finalization of the full contract. He said sub -consultants have been selected for the various components of the project: the three pipeline segments are being designed by Urban Engineering, Naismith Engineering and Govind & Associates; the structural work and the site civil work related to the pump stations are being designed by Goldston Engineering. The environmental permitting work is being conducted by Shiner, Moseley & Associates, and Koch Pipeline Group is acquiring the right-of-way. He said several actions will be occurring concurrently due to the compressed time frame of the project. Minutes Regular Council Meeting October 29, 1996 Page 7 Council Member Best asked if Coastal Refinery had made an offer concerning their right-of- way. Mr. Crull explained that in an earlier phase of this project, there had been discussions about utilizing one of Koch Pipeline's right-of-ways, but he was not aware of any discussion concerning Coastal. He noted that the problem with using either company's right-of-ways is that most of the easements that are granted are for a specific number of pipelines and specific products. To expand that easement right, permission would again have to be sought from the property owners and environmental concerns not previously addressed with some older easements would have to be dealt with. It was concluded that the city should buy its own right of way. Responding to questions from Council Member John Longoria, Mr. Hennings said the Council would be presented with the final contract for their approval. He added that Mr. Crull has been working diligently with the Port of Corpus Christi and the engineers on the project, and he has the authority to continue working with them. Mr. Longoria questioned the wording of Section 2.08, and Mr. Hennings replied that that was standard language in a contract such as this one. Regarding Mr. Longoria's question of Section 3.02, Mr. Hennings said a bank will serve as trustee, and the city will make payments to the bank. Council Member Heldenfels said he was not comfortable with the proposal of the City Manager approving acquisitions of property and other items; he said the City Council should make those approvals. Mr. Heldenfels also questioned Section 3.01, which states that the project will be financed by "one or more issues" of the Authority's bonds. Mr. Hennings explained that a bond resolution containing the maximum of $135 million was passed, but he did not think the actual cost of the project would be that high. He said it was his intention that there will be a very specific cap on the project. Responding to Mr. Heldenfels' first comment, Mr. Hennings said he planned to bring any controversial items to the Council, but the intention was to avoid administrative delays wherever possible. Mr. Hennings pointed out that in Section 2.07, the agreement would allow the Nueces River Authority to make minor revisions to the plans and specifications; however, city approval would be required for major revisions. In addition, the Authority would notify the city when the project has been substantially completed, and they would deliver a list of all of the property that has been acquired. At that point, the project would become the property of the city, and the city would be solely responsible for its operation (Section 2.10). Responding to a question from Council Member Martin concerning Section 2.10, City Attorney Bray said there would be no warranties with respect to the project itself; the Nueces River Authority will assign to the city all of their contracts from the contractor that contained the warranties. Mr. Heldenfels asked if the city could obtain a general warranty deed from the Authority, and Mr. Hennings said staff would review that. Minutes Regular Council Meeting October 29, 1996 Page 8 Mr. Hennings said that in Section 3.12 it states that interest earned on the bonds shall be used to pay debt service on the bonds of capital costs of the project, and any left over would go to the city. A brief discussion ensued about the question of interest, and Mr. Hennings said staff would investigate it further. He then referred to Section 4.03, which provides that payments by the city would be an operating expense of the city utility system, and the city will fix such rates and charges, including but not limited to a cost -of -water pass-through charge, as will produce revenues at least equal to expenses of operation and maintenance of the city utility system. He added that no tax revenues of the city are pledged under the contract. The City Manager said that in Section 4.07, the summary states that the city "pledges not to sell its utility systems, or parts thereof, to the extent its ability to comply with this agreement would be impaired." He said that provision has been included in past revenue bond covenants. Mr. Hennings said staff would take into consideration the Council's questions, and bring back a final document for their approval on November 12. Mr. Martin asked if the bidding approach the Nueces River Authority will use is substantially similar to what the city would use, and Mr. Hennings said it was, adding that the Authority is subject to state laws concerning competitive bidding. 5. POSTPONED Resolution authe.:ze,g the City Manages to execute o.i behalf of the City of Coipns Christi, Christi's ovate. fro... Lakc Texm.a to -the Corpus Ch.;sti-urea. * * * * * * * * * * * * * Mayor Rhodes opened discussion on Item 6, proposed financing and construction of the Lavaca-Navidad River Authority (LNRA) pipeline project. She noted that there was an amendment to Item 6.b., which was distributed to the Council. Council Member Martin said it was extremely critical that the city have the exact same types of authorities relative to the LNRA contract as the NRA contract. Mr. Crull replied that many of those issues were addressed in the original water conveyance contract with the LNRA, such as the city's approval of the plans and specifications, awards, bid documents, etc. Mr. Crull explained that this action is to allow the LNRA to proceed with their portion of the project, which is the initial pump station and the portion of the pipeline which lies on the Bureau of Reclamation property, which is controlled by the LNRA. He said the contract the city entered into in December 1993 provides for the LNRA to build this portion of the project upon request by the Minutes Regular Council Meeting October 29, 1996 Page 9 city. It also provides for the city to reimburse LNRA up to $450,000 for expenses that are incurred prior to delivery of bond proceeds for their portion of the project. Mr. Martin asked if the city would be reimbursed with interest on these funds and on the previously approved funds. Mr. Crull said staff would review that. Mayor Rhodes made a motion to amend Item 6.b. by adding the following language to the motion: "for the preparation of plans and specifications and performance of other project -related engineering tasks; providing the expenditure does not exceed $450,000." Council Member Best seconded the motion, and it passed unanimously. Mayor Rhodes called for comments from the audience on Items 6.a. and 6.b. Mr. John Hartley asked if expenses incurred by LNRA above and beyond --but related to --the expense of the pipeline's construction can be charged to the city. He also asked if the reinstatement of the Choke Canyon debt payments after five years will have an effect on customers' water bills. He said he could not believe that there were no other viable alternative water supplies than the one being recommended. He added that when the contract was signed, it was not called a utility and today it is being referred to as a utility. Responding to Mr. Hartley's questions, Mr. Crull said this proposal allows the LNRA to proceed with the engineering and permitting actions, and at a later date they will be issuing bonds for their portion of the project, and that debt service will be added to the city's monthly bill that it pays to LNRA. Mr. Hennings noted that legislation recently passed that allows for deferment of the Choke Canyon debt for five years. Mayor Rhodes asked how that payment will be reflected after the five years have passed. Mr. Hennings said that under today's scenario, it would not affect rates at all. Mr. Martin added that, in fact, it has the effect of foregoing what would have been an increase. Mr. J.E. O'Brien, 4130 Pompano, said he understood that this action was a loan to be repaid from bond proceeds, and he asked if it was legal for the city to loan money. He said the City Charter exempts from the referendum procedures appropriations already made, and he asked for a definition of the term "appropriations already made." In reply to Mr. O'Brien's questions, Mr. Bray stated that the city can loan money for public purposes just as it can spend money for public purposes. He said it seemed very clear that "appropriations already made" were not included in the initiative and referendum provision, and this action was an appropriation already made. Mr. Leon Perez, 904 Buford, asked what the Nueces River Authority and the Port of Corpus Christi were. Minutes Regular Council Meeting October 29, 1996 Page 10 Mr. Lewis Lovelace, 1549 Casa Grande, said the Council acts for special interests and always goes against the will of the majority of the voters. Mr. Phil Rosenstein said he is against any money being spent until the issue of declining block rates for industries is settled. City Secretary Chapa polled the Council for their votes as follows: 6.a. ORDINANCE NO. 022733 Ordinance appropriating $450,000 from the Unappropriated Fund Balance of the Combined Utility Fund to use as an advance on preliminary costs of the Lavaca-Navidad River Authority portion of the Lake Texana Pipeline Project, expected to be reimbursed from bonds issued by the Lavaca Navidad River Authority. An emergency was declared and the foregoing ordinance passed by the following vote: Rhodes, Best, Black, Cooper, B. Longoria, Martin, and McNichols voting "Aye"; Heldenfels and J. Longoria voting "No." 6.b. M96-334 Motion formally requesting the Lavaca-Navidad River Authority (LNRA) to proceed with the LNRA project portion of the Lake Texana - Corpus Christi Pipeline in accordance with the provisions of Section 2.04 of the Water Delivery and Conveyance Contract between the Lavaca-Navidad River Authority and City of Corpus Christi for the preparation of plans and specifications and performance of other project -related engineering tasks; providing the expenditure does not exceed $450,000. The foregoing motion passed, as amended, by the following vote: Rhodes, Best, Black, Cooper, B. Longoria, Martin, and McNichols voting "Aye"; Heldenfels and J. Longoria voting "No." ************* Mayor Rhodes called for a five-minute recess. * * * * * * * * * * * * * Mayor Rhodes opened discussion on Item 7, proposed FY 1996-97 capital budget. Ms. Grace McNett, Capital Budget Officer, said the proposed capital budget primarily Minutes Regular Council Meeting October 29, 1996 Page 11 reflects drainage, wastewater, and water improvements, as well as other significant needs. She referred to a pie chart illustrating the percentage of capital improvements by category, and she noted that the water supply (23.9%) was distinguished from general water projects (21.8%). Ms. McNett said another pie chart demonstrated the percentage of capital improvements by funding source, with revenue bonds constituting 78% of the funding. Ms. McNett said the capital budget also focuses on proceeding with the Gateway Project and the implementation of park and recreation improvements funded by the Community Development Block Grant (CDBG) program. In addition, CDBG funds will be used to eliminate architectural barriers at public facilities, in response to the Americans with Disabilities Act. She said there are a number of airport master plan projects, primarily a major reconstruction of the terminal facility, as well as the repair of the Health Department's roof with reprogrammed CDBG funds. The Capital Budget Officer went on to say that of particular note is a restructuring of the utilities capital improvement program (CIP) as a result of the drought. A number of projects have been shifted to later years in order to enhance the Combined Utilities Fund's financing capacity to undertake the water supply projects. The effect of the drought includes deferring 16 drainage projects totaling approximately $13 million; 15 wastewater projects totaling $74 million; and 10 water projects totaling about $38 million. She then referred to a graph which illustrates sustained progress in those projects which are supported by revenue-producing activities, while projects that rely on taxes (such as streets, parks and recreation, public health and safety, and public facilities) have fallen behind. She said that indicates a need to begin planning for a future bond election. Council Member Martin asked if the major change in the capital budget is that the water pipeline is no longer being treated as a capital project. Ms. McNett said it is not being included in the bond sale because of the NRA's financing proposal. Mr. Martin said he did not want to have the city's largest project in its history not reflected as one of its capital projects. Ms. McNett said staff would review that. Mr. Martin then asked about financial information provided to the Council which showed a $1 million gain in the debt service for utilities. Mr. Hennings said staff would respond to his question. Council Member Heldenfels reiterated his concern that involving the Port of Corpus Christi and the Nueces River Authority in the construction of the Texana pipeline was a violation of the city's contract with LNRA. Mr. Bray replied that the LNRA contract does not attempt to govem the city on how it carries out its responsibilities with regard to the pipeline. In addition, LNRA officials are cooperating with the city on their portion of the pipeline, and they have attended meetings regarding financing and engineering aspects of the project. Minutes Regular Council Meeting October 29, 1996 Page 12 Mayor Rhodes called for comments from the audience, and there were none. City Secretary Chapa polled the Council for their votes as follows: 7. FIRST READING ORDINANCE Approving the FY 1996-97 Capital Budget in the amount of $66,908,000. The foregoing ordinance passed on first reading by the following vote: Rhodes, Best, Black, Cooper, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye"; Heldenfels voting "No." * * * * * * * * * * * * * Mayor Rhodes called for consideration of consent motions, resolutions, ordinances and ordinances from previous meetings on Items 8 through 15, and Council Members requested that Item 9 be withheld for discussion. City Secretary Chapa polled the Council for their votes and the following were passed: 8. M96-335 Motion approving a supply agreement with Mueller Co., San Antonio, TX for approximately 106 fire hydrants ranging in size from 3' - 5 1/2', in accordance with Bid Invitation No. BI - 0018 -97, on the basis of low bid for an estimated annual expenditure of $58,064.02. The term of the contract shall be for twelve months with an option to extend for up to two additional twelve month periods, subject to the approval of the supplier and the City Manager or his designee. Funds are budgeted in FY 96-97 by the Water Department. The foregoing motion passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." 10. M96-337 Motion authorizing the City Manager to execute an agreement with Resource Management International for assistance concerning water rate design and miscellaneous utility system issues in an amount not to exceed $15,000. The foregoing motion passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." Minutes Regular Council Meeting October 29, 1996 Page 13 11.a. M96-338 Motion authorizing the City Manager, or his designee to execute an agreement with Corpus Christi Independent School District (CCISD)/ Casa Linda Elementary School to provide $20,000 from the FY 1995 CDBG Program to construct a play area cover at Casa Linda Elementary School Playground. The foregoing motion passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." 11.b. M96-339 Motion authorizing the City Manager, or his designee to execute an agreement with Corpus Christi Independent School District (CCISD)/ Coles Elementary School to provide $75,000 from the FY95 CDBG Program to install an air-conditioning system at Coles Elementary School Gymnasium. The foregoing motion passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." 12. RESOLUTION NO. 022734 Resolution authorizing the resale of sixty-two properties shown on the attached and incorporated Exhibit A for a minimum opening bid amount equal to 20% of the most recent appraised value of each. The foregoing resolution passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." 13.a. M96-340 Motion authorizing the City Manager or his designee to accept a grant in the amount of $750,268 and to execute contract change No. 4 to Contract No. 7460005741-97 with the Texas Department of Health for public health services, including immunization and laboratory services, during the period September 1, 1996 to August 31, 1997. The foregoing motion passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." Minutes Regular Council Meeting October 29, 1996 Page 14 13.b. ORDINANCE NO. 022735 Ordinance appropriating $61,296 from the Texas Department of Health in the No. 162 Federal/State Grants Fund for public health services, including immunization and laboratory services during the period September 1, 1996 to August 31, 1997, (with the remainder of $688,972 paid directly by the State for in kind services) adding $61,296 to the No. 162 Federal/State Grants Fund - Health Department. An emergency was declared and the foregoing ordinance passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." 14.a. ORDINANCE NO. 022736 Ordinance authorizing the City Manager, or his designee, to execute an Interlocal Agreement with the Coastal Bend Council of Governments that will fund the purchase of a compost screen for the City's centralized composting program. An emergency was declared and the foregoing ordinance passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." 14.b. ORDINANCE NO. 022737 Ordinance adding $130,000 from the Coastal Bend Council of Governments, as a pass- through grant from the Texas Natural Resource Conservation Commission, to the FederalState Grants Fund No. 162 and appropriating $130,000 from the Federal/State Grants Fund No. 162 to purchase a compost screen for the City's centralized composting program. An emergency was declared and the foregoing ordinance passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." 15. ORDINANCE NO. 022738 Ordinance authorizing the City Manager, or his designee, to execute a six-month lease, with the option to extend for one additional six-month period, with Lori Willson dba Merchant Ivory Trading Company for 60 square feet of rental space in the airport terminal at the Corpus Christi International Airport to provide sales of flowers and flower arrangements in consideration of payment of the greater of 10% of gross sales or $175.00 a month. Minutes Regular Council Meeting October 29, 1996 Page 15 An emergency was declared and the foregoing ordinance passed by the following vote: Rhodes, Best, Black, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye." * * * * * * * * * * * * * Mayor Rhodes opened discussion on Item 9, water well lease agreement. Responding to Council Member Black, Mr. Crull said the city negotiated the lease in question in 1984, but staff was unable to secure an easement across the adjacent property to supply power to the well; in addition, in 1984 the drought broke and the well was subsequently not needed. He said this action would reinstate the lease for a five-year term. Mrs. Black asked about the value of the well, and Mr. Crull replied that it is rated to produce almost one million gallons per day, and it is comparable to the other wells in the vicinity. Council Member Heldenfels asked if the well was already drilled when the city entered into the 1984 agreement, and Mr. Crull said it was. Responding to another question from Mr. Heldenfels, Mr. Crull said he thought the well was located in the Gulf Coast Aquifer, which is insulated from Wesley Seale Dam by many layers of clays. Mayor Rhodes called for comments from the audience, and there were none. City Secretary Chapa polled the Council for their votes as follows: 9. M96-336 Motion authorizing the City Manager or his designee to execute a water well lease agreement with John Lloyd Bluntzer, Carl F. Bluntzer, Evelyn P. Bluntzer, and Diane P. Peters trustees under the Will of Fannie B Nason. The City will pay $1,500 per month plus an additional $.15 per thousand gallons on water volume over 10 million gallons for an initial term of five years and twenty days, with an option to extend for an additional five years. The foregoing motion passed by the following vote: Rhodes, Best, Cooper, Heldenfels, B. Longoria, J. Longoria, Martin, and McNichols voting "Aye"; Black voting "No." * * * * * * * * * * * * * Mayor Rhodes called for the City Manager's report. Mr. Hennings pointed out that with the conclusion of Daylight Savings Time on October 27, 1996, there is a change in the Water Conservation and Drought Contingency Plan: trees, shrubbery, plants, gardens, vegetables, and flowers can be watered at any time during the day or night on an odd -even schedule based on Minutes Regular Council Meeting October 29, 1996 Page 16 address. The hour restrictions are no longer in effect during the cooler months of November through April since evaporative losses are minimal from this type of watering. The restrictions pertaining to lawn watering remain in effect: it is allowed on a 14 -day cycle based on address and is prohibited between the hours of 10 a.m. to 6 p.m. Mr. Hennings said there would not be a Council meeting next week (November 5th) since it was the first Tuesday of the month. Items scheduled for the November 12th meeting include: the contract with the Nueces River Authority; the final reading on the raw water pass-through ordinance; a report on the factory outlet center; six zoning cases; and a discussion of the Garwood Irrigation Company option. Mayor Rhodes called for Council concerns and reports. Council Member McNichols asked if the Council could receive the background material on the Garwood option prior to the November 12th meeting to allow them ample time to study it. He said it was important that all of the communities which receive water from Corpus Christi adopt the water conservation measures approved by the Council. He pointed out that the combined reservoir capacity is decreasing again. Dr. McNichols also asked about the status of the financial plan to rebuild the General Fund ending balances. Mr. Hennings replied that he intended to bring that issue back to the Council. He said he felt that the Council needed to adopt a financial plan to take to the bond rating agencies, and deal with the policy issues as well. Council Member Martin asked if compliance letters had been sent to the appropriate communities regarding water conservation measures, and Mr. Hennings said staff would provide a follow-up report. Mr. Martin also asked about possible restrictions in discussing the Waldron Road school zone crossing situation in light of a recent claim that was brought against the city. Mr. Bray said there would probably be a need to discuss some of the litigation aspects in closed session, but more general discussions could be held. He added that staff would bring that issue back to the Council. Mr. Martin then requested clarification of a recent memorandum prepared by staff concerning the Texas Municipal Retirement System. He also asked about the status of the city's audit. Mr. Hennings said the audit was several weeks away; however, representatives of the rating agencies will be attending the Texas Municipal League state convention in Corpus Christi in November. Mr. Martin asked if the Council should meet briefly next week since the November 12th meeting contained many important issues. Mr. Hennings pointed out that the Garwood issue was not an action item for that date. He added that Council meetings scheduled for December were December 10th and December 17th. Mr. Martin asked if a meeting should be scheduled on December 3rd, and Mayor Rhodes agreed that that was an option. Minutes Regular Council Meeting October 29, 1996 Page 17 Council Member Best requested that the developers of the Frost Brothers Building and the factory outlet center both appear to update the Council on the status of those projects. Council Member John Longoria asked if there would be more discussion by the Council of the Kostoryz street project, and Mr. Hennings said there would be. Mr. Longoria then asked about rehabilitation of the Campbellton wells. Mr. Hennings said that was a complex issue and several factors would determine when that issue would be dealt with. Mr. Longoria asked about a specific minority participation project. Mr. Hennings replied that the minority participation requirement on that project was not waived but reduced from 15% to 5% based on the assessment of the nature of the contract and the availability of subcontractors for the work. He said he would provide a full report. Mr. Longoria then referred to a list of City Council action requests, stating that they needed to be responded to in a more expeditious manner. * * * * * * * * * * * * * Mayor Rhodes called for petitions from the audience. Ms. Aima Werner, 810 Oak Park, discussed the organization RID (Remove Intoxicated Drivers) and a specific accident involving an intoxicated driver. She expressed concern about corruption in Corpus Christi, pointing out that the city's name translates to "the Body of Christ." There being no further business to come before the Council, Mayor Rhodes declared the Council meeting adjourned at 4:45 p.m. on October 29, 1996. * * * * * * * * * * * * *