HomeMy WebLinkAboutMinutes City Council - 02/10/1998I 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 February 10, 1998, which were approved
by the City Council on February 17, 1998.
WITNESSETH MY HAND AND SEAL, this 17th day of February, 1998.
Armando Chapa
City Secretary
SEAL
MINUTES
CITY OF CORPUS CHRISTI, TEXAS
Regular Council Meeting
February 10, 1998
2:00 p.m.
PRESENT
Mayor Loyd Neal
Mayor Pro Tem Dr. David McNichols
Council Members:
Javier Colmenero
Melody Cooper
Alex L. Garcia Jr.
Arnold Gonzales
Betty Jean Longoria
John Longoria
Edward Martin
City Staff:
City Manager Bill Hennings
City Attorney James R. Bray Jr.
City Secretary Armando Chapa
Mayor Neal called the meeting to order in the Council Chambers of City Hall.
The invocation was delivered by Father Richard Speer, St. Andrews Episcopal Church,
following which the Pledge of Allegiance to the flag of the United States was led by Council
Member Betty Jean Longoria.
City Secretary Chapa checked the roll and verified that the necessary quorum of the Council
and the required charter officers were present to conduct the meeting.
Mayor Neal called for approval of the minutes of the regular Council meeting of January 27,
1998, and there being no corrections, he proclaimed them approved as presented.
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Mayor Neal referred to the presentations on the day's agenda. Judge Lisa Gonzales described
the earned income credit (EIC) that is available to wage-eamers who meet certain income guidelines.
She said that last year the EIC campaign brought in about $83 million to the area counties of Nueces,
Jim Wells, San Patricio, and Duval.
Responding to Council Member Betty Jean Longoria, City Manager Hennings said that city
employees were notified of the EIC campaign through the payroll distribution, and the city provides
assistance to the employees in filing the EIC application if needed.
Council Member Cooper, Chairperson of the Mayor's Task Force on Youth Violence,
presented a grant in the amount of $1,500 to representatives of Police Explorers Post 218 for their
grassroots efforts to benefit youth. Mrs. Cooper said the task force would also distribute a grant
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Regular Council Meeting
February 10, 1998
Page 2
check for $1,500 to the LULAC Tae Kwon Do youth program. Mrs. Cooper thanked several
businesses which contributed donations for the grants.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item H., city manager recruitment profile.
City Secretary Chapa said Mr. Chuck Rohre, Vice President of Ralph Andersen &
Associates, was presenting the Council with the third draft of the recruitment profile. Mr. Chapa
noted that Mr. Rohre had attended the Council's last meeting on January 27th, at which time the
Council members suggested several changes to the profile. Mr. Rohre then provided the Council
with a second draft and received their comments on that document as well.
Mr. Rohre said that in the third draft he added one more company to the list of major
employers in the city, and he slightly revised the information regarding the city departments to
reflect the current organizational chart. He said this document has several purposes, one of which
will be as a benchmark in evaluating city manager candidates. There were no comments from the
Council.
Council Member Gonzales made a motion to approve the draft city manager recruitment
profile as presented that day by Mr. Rohre, seconded by Council Member Betty Jean Longoria, and
passed (Martin voting "No").
* * * * * * * * * * * * *
Mayor Neal called for petitions from the audience.
Mr. Leon Perez, 904 Buford, questioned recent trips by city staff members to view the
computer systems in certain U.S. cities. Mayor Neal asked Mr. Hennings to have a staff member
respond to Mr. Perez's concerns.
Mr. Roy Martinez asked about the Southwestem Bell franchise fees that were increased last
year, in particular the monies involving the Coastal Bend Council of Governments (CBCOG). Mr.
Hennings replied that the telephone company pays franchise fees to the city, as well as a 50¢ 9-1-1
fee to the CBCOG. The city has asked that the 50¢ fee be discontinued, and the State Advisory
Committee on Emergency Communications has not yet taken action on the city's request. He said
there is a meeting in Austin tomorrow regarding that issue. Mayor Neal said he will be attending that
meeting.
* * * * * * * * *
*
* * *
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Regular Council Meeting
February 10, 1998
Page 3
Mayor Neal opened the public hearing on Item 2, electric power supply franchise.
City Manager Hennings referred to a diagram and explained how Central Power and Light
Company (CPL) presently supplies electricity to its customers. He said Corpus Christi Power and
Light (CCPL) was proposing to purchase electricity from other electricity generators, who will
deliver the power into CPL's system. He said the customer will have the choice of selecting either
CPL or CCPL to be the provider of electrical service. Customers who select the new company would
continue to pay their bills to CPL, which would then pass on the appropriate amount of revenues to
CCPL. Mr. Hennings said CCPL states that it can lower electricity bills by 15% to 20%, and if that
reduction were made available to all Corpus Christi customers, it could result in a potential savings
of $35 million to $40 million each year.
Mr. Hennings further explained that the proposed ordinance would order CPL to participate
in this endeavor by offering its customers the opportunity to choose service provided by CCPL, and
then CPL would collect and pay to the new company the appropriate amount of revenue, as
previously explained. He said CCPL has also agreed to enter into a franchise agreement with the
city, which would protect the city's street rental revenues (a significant part of the city's General
Fund budget). Mr. Hennings said CPL has argued that this proposal is illegal and they have
threatened to file a complaint against the city; in fact, past decisions by the City Council in electricity
rate cases have been appealed by CPL to the Public Utility Commission (PUC) of Texas. He noted
that the City Council has original jurisdiction in electricity rate matters.
The City Manager added that CCPL has also agreed to reimburse the city's out-of-pocket
costs, such as in defending an appeal before the PUC or defending litigation. In addition, CCPL has
offered to provide the city with a $25,000 irrevocable letter of credit. He said that during this Council
meeting a public hearing will be held, which is required by law in such proceedings. He
recommended that following the public comment portion, the Council meet in executive session to
receive advice from the city's attorney on this matter. He said based on the information they have
received up to this time, he recommends that the City Council proceed to approve the two ordinances
on the day's agenda. He said initially he had suggested that action on this issue not be considered
until next week; however, CPL requested --and CCPL concurred --that action on these items be
scheduled for the same meeting as the public hearing. Mr. Hennings said the Council did have the
option to defer action until next week. He also noted that if the Council approves the ordinances,
they would be effective in about three months, but if the ordinances are voted down today, no further
action would be needed.
Council Member Garcia asked that if the Council approved the proposal and both companies
were in operation, whether there would be any way for a customer to be denied electrical service,
and Mr. Hennings said he was not aware of any such circumstances. Mr. Garcia also asked if any
other companies had approached the city with a similar proposal, and Mr. Hennings said that has not
occurred in recent weeks, although other companies have approached the city in the past few years.
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Regular Council Meeting
February 10, 1998
Page 4
Mayor Neal said he had been faxed a letter dated February 6, 1998 from the South Texas
Electric Cooperative Inc. (STEC) located in Nursery, Texas. He said the letter states that Nueces
Electric Cooperative Inc. holds a certificate of convenience and necessity (CCN) from the PUC of
Texas to serve portions of Corpus Christi at retail, and STEC holds a CCN to operate as an electric
utility. In addition, STEC asked that the Corpus Christi City Council reject the claims made by
Corpus Christi Power and Light and consider instead Nueces Electric Cooperative.
Mr. Bruce Evans, President of Central Power and Light Company, said that for over 80 years
CPL has been serving the citizens of South Texas with reliable electric power, and today that number
is 600,000 customers. In addition, CPL employs 700 people in the Corpus Christi area, and their
average annual franchise payment to the city is $8 million, with $1.4 million paid in ad valorem
taxes and $307,000 in contributions was made to various non-profit organizations last year. Mr.
Evans also described the ways in which CPL employees are involved throughout the community,
as well as several programs that CPL sponsors in the schools.
Mr. Evans said that deregulation of the electric industry is inevitable and when that occurs,
there will be several companies making proposals to provide electric service to Corpus Christi.
However, he said, since the legislation has not yet been passed, Corpus Christi Power and Light's
proposal is illegal because it would require CPL to engage in "retail wheeling," which is currently
prohibited by regulatory law. He said that during the last session of the Texas Legislature, some bills
were introduced that pertained to electric industry deregulation, and CPL and Central Southwest both
supported the governor's bill on deregulation that was introduced near the end of the session (but
was not passed). He said CPL will work to push forward legislation in the 1999 session that will
offer full electric choice to all Texas citizens, keeping in mind the issues of reliability and the need
for utilities to be able to recoup investments made in their infrastructure.
Mr. Evans went on to say that CPL supports retail competition because the company would
no longer be "captive" to its service territory and would be able to expand its customer base. He said
that if the Council supports CCPL's proposal, CPL would, in essence, have to break the law by
engaging in retail wheeling and they would have no option but to pursue their legal remedies.
Mr. Phil Ricketts, regulatory counsel for CPL, said that on a number of previous occasions,
CPL representatives have communicated to the city's attorneys that adoption of the tariff proposed
by Corpus Christi Power and Light would place the City Council in the regrettable position of being
in violation of both state and federal regulatory law.
Mr. Ricketts said that when the Council discussed this issue during their January 20th
meeting, Mr. Robert Webb, an attorney representing CCPL, was asked whether CCPL needed a
certificate of convenience and necessity from the PUC before it could offer this service. Mr. Ricketts
said Mr. Webb responded that his company would need a CCN if the company was using any type
of facilities to provide retailing -serving customers at retail service. Mr. Ricketts added that in the
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Regular Council Meeting
February 10, 1998
Page 5
Public Utility Regulatory Act, the word "facilities" means any kind of asset, such as a contract with
a customer or a power supply contract. He said if CCPL has any facilities and is providing retail
service to customers in Corpus Christi, it needs a CCN from the PUC, which he explained. Mr.
Ricketts said it also places upon the City Council the obligation to regulate CCPL's rates and
services.
Mr. Ricketts said he thought CCPL's proposed tariff was drafted so that the Council would
not regulate the rates or services of CCPL, and there is nothing in the tariff that requires CCPL to
obtain a CCN. He said that in response to Council Member McNichols' question during the previous
discussion, Mr. Webb characterized CCPL's service as a wholesale service, saying it was similar to
the wholesale services that CPL obtains and provides to its interruptible customers, and to the
services that Texas -New Mexico Power Company has in place for some of its customers. Mr.
Ricketts said a wholesale transaction would be one where CCPL would sell the power to CPL, who
would then resell it on its own to its own customers and then collect and keep the money.
Mr. Ricketts said even if it was a wholesale transaction, there are a number of reasons why
the Council would be unable to adopt this tariff as it is written: the jurisdiction of the Council is
limited to the boundaries of the Corpus Christi city limits, yet the transaction proposed by CCPL
takes place outside the city limits; Texas law states that no city has jurisdiction over wholesale
transactions, rates, or services, as opposed to retail services; and there is a provision in the Public
Utility Regulatory Act called the Integrated Resource Planning Process which gives the Texas PUC
authority over what wholesale transactions utilities enter into, and it does not confer any authority
on city governments. In addition, Mr. Ricketts said that no wholesale supplier needs to obtain a
franchise from a city in which that wholesale supplier's power is ultimately resold at some point in
time, which he further discussed.
Mr. Ricketts also discussed the issue of "unbundled rates," and he said that the Federal
Energy Regulatory Commission (FERC) states clearly that it alone regulates the transmission
component of unbundled rates; any attempt by this Council to set those transmission rates --which
he said the proposed tariff attempts to do --would be a violation of federal regulatory law. Mr.
Ricketts said that CCPL brought this issue to the City Council rather than the PUC because Mr.
Webb had previously made the same proposal on behalf of another company before the PUC, which
rejected the proposal. He noted that this issue is being debated by the Senate Interim Committee and
will be taken up for consideration by the Texas Legislature next January. Mr. Ricketts also referred
to a February 6, 1998, letter to the City Council from the general counsel of the Texas -New Mexico
Power Company, in which it was stated in part that TNMP's economy service tariffs do not provide
customers with choice as to their power suppliers.
Responding to Mayor Neal, Mr. Ricketts said that if CCPL is engaging in a wholesale
transaction, the City Council does not have any jurisdiction over that issue. He said in his opinion,
CCPL's proposal involves retail wheeling, which is illegal.
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Regular Council Meeting
February 10, 1998
Page 6
Council Member Gonzales asked who decides whether it is wholesaling or retailing. Mr.
Ricketts said he thought the Council had the authority to make that decision. Responding to another
question from Dr. Gonzales, Mr. Ricketts said that if the Council voted to approve the tariff, CPL
would have the right to file an appeal to the PUC within 30 days after the tariff takes effect, which
he explained.
In reply to several questions from Mr. Garcia, Mr. Evans said CPL is pushing for legislation
to deregulate the industry, but they believe that legislation needs to deal with many issues, such as
reliability, competition, and infrastructure investments. Mr. Ricketts reiterated his comments that
Mr. Webb had previously unsuccessfully presented a similar proposal to the PUC, and he again
discussed the legalityof CCPL's proposal as well as what he said was a lack of consumer protection
in the new company's tariff. Mr. Evans also discussed the fact that CPL is required to distribute a
brochure concerning the customers' rights, and he said he has not seen such a document from CCPL.
Council Member McNichols asked where retail wheeling is in existence in Texas today, and
Mr. Ricketts replied that he did not think it was. Dr. McNichols said that would mean Corpus Christi
would be the first Texas city to allow retail wheeling, and Mr. Ricketts agreed.
Responding to Council Member Betty Jean Longoria, Mr. Hennings said there are two major
benefits for the city if this proposal is approved: the cost savings to customers, and the advantage
to the city of having a franchise agreement with the new company, which he explained. Mr. Ricketts
added that whatever decision the Council makes that day with regard to the proposed tariff can be
appealed to the PUC.
Council Member Cooper asked Mr. Ricketts about the appeal process, to which he
responded. Mrs. Cooper then questioned why the city would want to take any action now to approve
CCPL's proposal since it will be delayed in the appeal process for some months, and the Legislature
will be considering deregulation beginning next January. Mr. Hennings reiterated that if both the
City Council and the PUC approved this proposal, the new company could be in business in about
six months, even if the PUC's decision is further appealed to the courts. He also emphasized that
there would be the opportunity for a franchise agreement on the local level with CCPL.
Mr. Ricketts said if this proposal was approved CPL would have no choice but to file an
original complaint with the FERC asking them to reverse the ordinance on the grounds that the
Council was exceeding its jurisdiction in setting retail transmission rates. He said CPL would have
the right to request a stay of the ordinance pending the FERC proceeding.
Council Member Martin pointed out that in his experience there has never been a case in
which CPL has not appealed a decision of the Corpus Christi City Council; in fact, he said, CPL has
encouraged the Council to pass a tariff so that they can appeal the decision to the PUC because it is
the body that has the capacity to make those technical decisions. Mr. Ricketts noted that CPL did
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Regular Council Meeting
February 10, 1998
Page 7
not think it was appropriate to litigate this proposal before the PUC because it has been previously
decided by them (in the form of a proposal from another company).
Mr. Tony Canales, of Canales & Simonson, said he was representing CPL with regard to the
federal litigation. He questioned why the Council needed to proceed at this time with CCPL's
proposal which, if the Council approved it, would be a facially invalid ordinance that has been
completely preempted by the federal government. He noted that CCPL had pledged to reimburse the
city's out-of-pocket expenses, and he said there would be many expenses associated with federal
litigation. Mr. Canales also said public policy dictates that it is prohibited to decide an issue based
on a third party's financial interest, and he quoted from a federal statute regarding retail wheeling.
Mayor Neal asked whether there would be anything preventing other companies from
approaching Corpus Christi with similar proposals (including one company which has already done
so). Mr. Canales said CCPL's proposal is premature, and he said this matter rightfully belongs in the
Texas Legislature and the PUC. He also urged the Council to not be risk -takers in these proceedings.
Dr. Gonzales said he was willing to take risks for the community in the chance that a 20%
savings in electric rates can be realized. Mr. Canales replied that the 15% to 20% savings discussed
by CCPL were just opinions, and he added that they do not know where CCPL will be getting its
power from or whether they have long-term contracts. He said the city should rely on the PUC
because it can install the necessary safeguards with regard to disclosure of information.
Responding to Council Member Colmenero, Mr. Canales said that at the present time Texas
does not have a regulatory or statutory framework to implement retail wheeling, which is not against
the law per se but the framework must be in place. In reply to another question from Mr. Colmenero,
Mr. Ricketts addressed the formation of the Public Utility Regulatory Act and the PUC. Mr. Evans
also reiterated CPL's support for deregulation through the Texas Legislature, and he discussed the
jurisdiction of the FERC.
Dr. McNichols questioned the $25,000 letter of credit offered by CCPL. Mr. Canales pointed
out that CCPL's offer does not address litigation outside the PUC, and he said that $25,000 is
insufficient to cover those costs; rather, he said at least $1 million would be needed. He further
explained the litigation process that would be involved. Mrs. Cooper said she was in favor of saving
money for consumers, but she questioned whether that can be accomplished with the legal
complexities involved in this case.
In reply to Council Member John Longoria, Mr. Canales said it is CPL's contention that this
proposal would infringe upon CPL's right to freely engage in interstate commerce pursuant to the
Federal Energy Regulatory Commission rules.
Responding to other questions from Mr. Longoria, Mr. Hennings said that presently CPL
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Regular Council Meeting
February 10, 1998
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pays the city a franchise fee (street rental fee) of 4% of their gross receipts. If there is going to be
another electricity provider in the city, he said the city's revenue stream will be protected if the city
can obtain the same kind of street rental fee from the new company. He added that there will be a
debate in the next session of the Legislature regarding a city's right to collect those street rental fees
from companies who use city streets and utility easements to carry out their business. Mr. Evans said
CPL is the only company with poles in the public right-of-way, and any new companies would not
have to pay a franchise fee because they do not want to build new facilities in the right-of-way.
Mr. Martin pointed out that the Council will have to look to the people who are giving them
advice, knowing that all those people represent clients and positions. He said that while courts are
adversarial proceedings by their nature, they also make decisions as to legitimate disputes between
parties. He said if a federal court has to decide the federal issue in this case, and the PUC has to
decide the state issue, he said he did not think that would be a bad position to be in when the benefit
could be lower electric rates for citizens. Mr. Canales said there is an honest difference of opinion
on this issue, but economic interests are involved, and the Council needs to be able to see above
those interests. He said savings will be achieved through the orderly process of deregulation through
the Legislature.
Responding to Mr. Colmenero, Mr. Canales further described the appeal process and the
financial issues involved. Mr. Evans reemphasized that he lobbied openly on behalf of CPL during
the Last legislative session to get the govemor's bill passed, and he will do so again. In summary, Mr.
Evans said there are three issues the Council needs to consider in addition to the legal issues:
customer safeguards, reliability, and the erosion of franchise fees, which he briefly addressed. He
urged the Council to reject CCPL's proposal and instead to help CPL push the issue of deregulation
through the legislative process.
Mayor Neal called for a five-minute recess. Upon reconvening the Council meeting, the
Mayor said that the next group to address the Council would be representatives of Corpus Christi
Power and Light.
Mr. Juan Garza, President of CCPL, referred to comments made earlier in the meeting by
CPL representatives. He said the urgency regarding this proposal was the approximately $400
million a year which CPL is currently overcharging the Corpus Christi economy. He also referred
to the issue of franchise fees and the legality of CCPL's proposal, which they believe is legal. He
said both Mr. Evans and Mr. Ricketts said the proposal was illegal, but Mr. Canales said it was not
illegal per se.
Mr. Garza also said CPL knows that electricity flows to the point of least resistance;
consequently, the power could be produced in West Texas and it might wind up here since it is on
the interconnect. He said the fact that power is generated in Corpus Christi does not mean that it is
used here first. Mr. Garza said one of the strengths of CCPL's proposal is that it sets the precedent
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Regular Council Meeting
February 10, 1998
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of requiring a city franchise agreement before power is sold here.
Mr. Garza further stated that CCPL will agree to the following: to reimburse the city up to
$15,000 for the cost of drafting a new franchise agreement; to contractually preserve franchise
revenues at current levels; and to post a $25,000 irrevocable letter of credit to cover the cost of the
city's attorneys in the rate case. He said CCPL representatives understand that that would not cover
all the costs of defending the rate case, but they have proposed that Mr. Webb be appointed to defend
the rate case before the PUC, and in turn Mr. Webb will agree in writing that he will not bill the city
for the expense of defending the rate ordinance before the PUC in the unlikely event that CPL will
not reimburse the expenses as required by law. Mr. Garza also referred to information about electric
providers in the state. He pointed out that CPL basically operates in the southern part of Texas, the
area with the highest electric rates in the state.
Mr. Garza addressed the issue of the city protecting its original jurisdiction, and he said if
the Council supported CCPL's proposal, they would essentially be letting the PUC know what
Corpus Christi citizens want at the local level. He added that CPL did not support the deregulation
proposal in the last session of the Legislature until the last week and it failed. However, if that law
had been passed, it would have enacted competition in the year 2001, and if a law is passed in the
next legislative session, there will also be a delay in the commencement of competition.
The next representative speaking for CCPL was Mr. Robert Webb. Responding to Mayor
Neal, Mr. Webb said he was representing CCPL on a pro bono basis. Mr. Webb also referred to
statements made by the CPL representatives, saying that whether CCPL needed a certificate of
convenience and necessity was a debatable issue that was the exclusive jurisdiction of the PUC. He
said any utility that would provide services using the streets of the city would need a franchise,
whether or not it had a CCN.
Mr. Webb also said that CCPL, to the extent that it owns and operates facilities for the
generation, transmission or distribution of electricity in Texas, will be a utility, and all utilities are
regulated. He quoted from a portion of the Texas Utilities Code, which said that to provide fair, just,
reasonable, adequate and efficient services, the governing body of a municipality has exclusive
original jurisdiction over the rates, operations and services of an electric utility in areas within a
municipality. He said it does not make a distinction between retail and wholesale providers, or
between generators, transmitters or distributors. He added that the transactions engaged in by CCPL
and CPL as to the rate ordinance will all be within the city, and he further addressed the definition
of a utility.
Referring to Mr. Canales' arguments against CCPL, Mr. Webb reiterated that CCPL's
urgency is due to CPL overcharging its customers by $400 million a year. He also said that due to
the likely delay in implementing any deregulation legislation in the upcoming session, and despite
legal challenges that will be raised against CCPL's proposal, CCPL will still be able to provide cost
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Regular Council Meeting
February 10, 1998
Page 10
savings to consumers. Mr. Webb also referred to the Johnson Anti -Injunction Act, which says that
no federal court can enjoin the regulatory action of any state or local public utility regulator. Mr.
Webb also challenged Mr. Canales to cite a single case where either the FERC or a federal court has
imposed on a regulatory body (City Council or PUC) any fine for civil disobedience because the
regulatory body passed a rate order and it was overturned because the commission or the court
disagreed as to whether that was the law. He said the City Council should not be deterred by the
thought that CPL will try to bankrupt the city through high litigation costs because it does not
happen.
Former Texas Governor Mark White also spoke on behalf of CCPL. He said that CPL has
made many contributions to the community, and CCPL would also try to make similar contributions
if given the opportunity to serve the city. He said the Texas Legislature will have changed when it
reconvenes in January, and people do not know if the legislators will consider the deregulation issue;
even if such a bill did pass, there is no guarantee that it will lead to rate reductions and it would also
have a delayed implementation date. He said the City Council has the ability, the authority, and the
jurisdiction to take action today on CCPL's proposal.
Mr. White said that CPL is defending the rates it charges currently, and are fighting the rates
that were supposed to have been reduced, yet they claim they are in favor of deregulation. Mr.
White, a former Attorney General, said he would be willing to serve at no charge on behalf of the
city in any court. He also said that customer protection is extremely important, and he noted that
CPL is required by the PUC to distribute its brochures about customers' rights, and CCPL would
be required to do so as well, And CPL's concern about the practice of "slamming" would not be an
issue because customer shifts from CPL to CCPL would be closely monitored by CPL. He said
customers should be allowed to vote with their pocketbook about which electric utility to use.
Mayor Neal said he did not know anything about Corpus Christi Power and Light Company
since the Council had not been given any information about its financial situation, bylaws, or
shareholders. Mr. Garza replied that in their previous presentation to the City Council they had
named CCPL's stockholders (two of whom have since been added): DayLee Snell, Bill Bates, Ken
Berry, Hugo Berlanga, and Ruben Bonilla.
Mayor Neal also asked about CCPL's financial wherewithal, and Mr. Garza said the city
would not incur a major expense regarding this proposal because CCPL's attorneys would undertake
the defense of the proposal, and in the event that CPL would not reimburse the city for costs,
CCPL's attorneys would not bill the city for their services. Mayor Neal said he was not talking about
defense costs, but rather provisions in the proposed ordinance in which CCPL guarantees that it will
pay the city large sums of money. Mr. Garza said CCPL can deal with the fixed amount of $15,000
the city has set, and he noted that the $25,000 letter of credit will be irrevocable. He said the actual
promises on the delivery of the franchise fees to the City Council are based on sales.
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Regular Council Meeting
February 10, 1998
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Responding to Mr. Garcia, Mr. Garza said that there is a possibility that CCPL could go
before the PUC for a certificate of convenience and necessity. He said his primary concern from the
beginning was that the city be protected in its original jurisdiction power, and that franchises be
required of anyone who sells power within the Corpus Christi city limits. Mr. Webb noted that with
regard to both rate ordinances and franchise ordinances, a company has to appear before the City
Council first due to original jurisdiction.
Mr. Garcia also asked if CCPL could appeal an unfavorable ruling from the City Council to
the PUC. Mr. Webb replied that a party to a rate proceeding before the city can do that, and City
Attorney Bray would have to advise the Council as to whether CCPL is a party to the proceeding
involving the rate ordinance. However, he thought the PUC would look very closely at the City
Council's wishes on this issue, since it represents an innovation in the state. He added that Corpus
Christi presented itself as an opportunity because a number of Corpus Christi residents had expressed
concern with CPL.
Mr. Garza added that he is aware of the financial challenges facing the city and its residents,
and he said genuine relief is needed in utility rates. In reply to another question from Mr. Garcia, Mr.
Webb discussed his ethical responsibility in representing Corpus Christi in the rate case, and the
possibility that Mr. White could represent the city if necessary. Mr. Garza said the first motion that
the PUC would entertain from CCPL would be to direct CPL to reimburse the city. Mr. Garcia said
he still had mixed feelings about this proposal.
Mayor Neal called for comments from the audience.
Mr. J.E. O'Brien, President of the Corpus Christi Taxpayers Association, read from a
resolution passed on January 26, 1998 by the association members in which they petitioned the City
Council to take immediate action ordering city staff to study and report to the Council the feasibility
of a city -owned system for distributing electricity. Mayor Neal said the Council has already asked
city staff to do that, and they expect a report on the issue in the next few weeks.
Mr. Chuck Kleebauer, of the Caldwell Group of Corpus Christi, said they are a strategy
consulting company that looks at competition in the industries of telecommunications and energy.
He said that deregulation is inevitable, and he added that CCPL's proposal was a case of retail
wheeling, which is illegal until the law is changed by the Legislature. He suggested that the Council
not act on this proposal and wait until the Legislature takes action on it. Mayor Neal asked Mr.
Kleebauer if he was representing either CPL or CCPL, and he said he was not.
Mr. Byron Wooldridge, 6705 Deerwood, read a series of 15 facts that related to the issue of
desalination and power supplies.
Mr. Vic Menard, 1510 Dove Lane, said he serves as a state officer for the American
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Regular Council Meeting
February 10, 1998
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Association of Retired Persons (AARP), which opposed the deregulation legislation because of the
issue of consumer safeguards. He said they should move forward in an orderly fashion with the
proper safeguards in place through the appropriate legislation.
Mr. Glynn Pugh proposed that the city be a third provider of electricity, and since CPL has
the highest rates in Texas, the city would benefit from having competitive rates here.
Mrs. Dorothy Spann described how CPL has continued to unfairly overcharge its customers.
Mr. Ramiro Ramos, 5313 Woodgate, said he has been working for CPL for 18 years, and he
recognized other CPL employees who were in the audience. He said the employees work hard to
provide electricity and that the company can be trusted.
Mr. Alex Harris, 317 Louise, who has been active with the Greater Corpus Christi Business
Alliance, said Corpus Christi's high electric rates have created a problem in trying to bring
businesses to the city. He encouraged the Council to approve CCPL's proposal.
Ms. Mary Williams, 601 Barracuda, a teacher at Hamlin Middle School, described how CPL
has been active in schools and in the community.
Mr. Alberto Sifuente, a resident of Leathers Housing Project, spoke of the difficulty that
many people have in paying high electric bills.
Mr. Robert Morris, 509 Brawner Parkway, said he thought the purpose of this ordinance was
to allow this case to proceed to the PUC. He urged the Council to not be intimidated by threats of
legal action by CPL.
Mr. Tom Sigardson, 6622 Bent Trail, expressed concern about CCPL and its financial
backing.
Council Member Martin made a motion to close the public hearing, seconded by Council
Member McNichols, and passed unanimously. The Council then went into closed session on Items
2.a. and 2.b. pursuant to Texas Government Code Section 551.071.
The Council returned from closed session.
Mr. Hennings said he has recommended that the Council approve on first reading both of the
ordinances on the day's agenda. He said there are a few minor amendments that staff would
recommend before second reading if the Council approves the first reading ordinances
Mr. Martin made a motion approve Items 2.a. and 2.b., seconded by Mrs. Longoria.
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Regular Council Meeting
February 10, 1998
Page 13
Referring to the proposed ordinances, Mayor Neal questioned Section 1.01 under Item 2.a.
regarding CCPL's "successors and assigns." City Attorney Bray replied that under the City Charter,
CCPL would have to receive Council consent for an assignment, which could not be unreasonably
withheld. He said the proposed CCPL ordinance states that it is subject to all the provisions of the
City Charter. Mayor Neal also pointed out that Section 1.01 would give CCPL the right to use,
construct, install, maintain, repair, and operate in the city's streets and rights-of-way. Mr. Bray said
if CCPL elected to, they would be authorized to do that. He added that CCPL had applied for a
franchise agreement with the city and had requested the same terms as the existing CPL franchise,
even though they said it is not their present intent to put any apparatus in the ground.
The Mayor then referred to Section 2 of the ordinance under Item 2.a., and he said he did not
think that section required any kind of financial backing of the indemnification agreement. Mr. Bray
said the first part is a standard indemnification provision, and the guarantee is that CCPL is
undertaking to defend the ordinance in court by using their own lawyers, with the exception that the
city will hire a lawyer to monitor what CCPL is doing, and that cost will be paid on a monthly basis.
Mr. Bray added that the potential risks that were identified were the possible loss of franchise fees,
for which CCPL would be required to pay 5% of revenues rather than 4% like CPL, and the expenses
of litigation, which are addressed in Section 1.04. He said Section 2 does not require any kind of
additional financial backing or bond. He reiterated that this ordinance contains the basic provisions
as stated in the CPL franchise.
Mr. Garcia asked about the issue of reliability of service, such as in the instance of a storm
or an electric pole being lcnocked down. Mr. Hennings said CPL would be responsible since they
would own the equipment.
Mayor Neal said he wished to vote first on this issue; City Secretary Chapa polled the
Council for their votes as follows:
2.a. FAILED TO PASS
light, heat, and Lowe. franchise.
The foregoing ordinance failed to pass by the following vote: Colmenero, Gonzales, B.
Longoria, and Martin voting "Aye"; Cooper, Garcia, J. Longoria, McNichols, and Neal
voting "No."
2.b. FAILED TO PASS
Directing eertann tate sehedul.,s, and making findings of faet that the -existing rate, of Central
Pewee and Light Ceinnpany ane unreasonable and diserirnwatety to th.;-txtei.t they do not
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Regular Council Meeting
February 10, 1998
Page 14
to b., ehargcd by Central Pewei and Light Campai,y.
The foregoing ordinance failed to pass by the following vote: Colmenero, Gonzales, B.
Longoria, and Martin voting "Aye"; Cooper, Garcia, J. Longoria, McNichols, and Neal
voting "No."
*************
Mayor Neal opened the public hearing on Item 3, economic development tariff through CPL.
He called for comments from the audience, and there were none.
Council Member McNichols questioned a letter from Mr. Keith Arnold of the Greater Corpus
Christi Business Alliance contained in the agenda material. Mr. Bray replied that the request came
last fall and staff discussed it with CPL, and he said he thought they did not have any immediate
applicants. Council Member John Longoria asked if this rate would be retroactive, and Mr. Hennings
said it would not be retroactive and it would be effective upon passage of the second reading for four
years. Dr. McNichols made a motion to close the public hearing, seconded by Mr. Garcia, and
passed.
City Secretary Chapa polled the Council for their votes as follows:
3. FIRST READING ORDINANCE
Approving, ratifying, confirming, and accepting an Economic Development Rate filed by
Central Power and Light Company for the furnishing of service within the City of Corpus
Christi, Texas, by Central Power and Light Company.
The foregoing ordinance passed on first reading by the following vote: Colmenero, Cooper,
Garcia, J. Longoria, McNichols, and Neal voting "Aye"; Gonzales, B. Longoria, and Martin
absent.
*************
Mayor Neal opened the public hearing on the following zoning case:
4. Case No. 1297-1. Spohn Memorial Hospital: A change of zoning from a "B -2A" Barrier
Island Business District to an "I-3" Heavy Industrial District on Padre Island - Corpus
Christi, Section 18, Block 4, being .028 acre out of Lot 5, located approximately 350 feet
east of South Padre Island Drive and approximately 900 feet north of Verdemar Drive.
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Regular Council Meeting
February 10, 1998
Page 15
City Secretary Chapa said the Planning Commission and staff recommended denial of the
"I-3" District, and in lieu, approval of a Special Permit for a medical helipad subject to a site plan
and two (2) conditions. No one appeared in opposition to the zoning change. Council Member Garcia
made a motion to close the public hearing, seconded by Council Member Cooper, and passed.
Council Member McNichols said they discussed this case with the head of trauma services
at Spohn Memorial and received answers to his questions regarding the triage matter. Mr. Brandol
Harvey, Director of Planning and Development, said that staff received a reply from the Naval Air
Station Corpus Christi, and they basically said that all air operations in this area must be coordinated
with their air traffic control and they expressed no concerns.
City Secretary Chapa polled the Council for their votes as follows:
4. ORDINANCE NO. 023204
Amending the Zoning Ordinance upon application by Spohn Memorial Hospital, by granting
a special permit for a medical helipad to .028 acre out of Lot 5, Block 4, Section 18, Padre
Island - Corpus Christi.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Cooper, Garcia, J. Longoria, McNichols, and Neal voting "Aye"; Gonzales, B.
Longoria, and Martin absent.
Mayor Neal opened the public hearing on the following zoning case:
5. Case No. 1097-8. Norwest Bank Texas. South Central, Trustee: A change of zoning from
an "R -1B" One -family Dwelling District to an "I-2" Light Industrial District on Baldwin
Moore Farm Lots, being 2.56 acres out of Lot 2, located along the northeast side of South
Padre Island Drive, between West Point Road and Bush Avenue.
City Secretary Chapa said the Planning Commission and staff recommended denial of the
"I-2" District, and in lieu thereof, approval of a "B-1" Neighborhood Business District with a Special
Permit for a warehouse/distribution facility subject to a site plan and eight (8) conditions.
Rev. J.R. Miller, Pastor of Friendship Baptist Church, said he had just received new
information regarding this zoning case, and he asked if he could defer to the applicant for
clarification. Mayor Neal said that would be appropriate.
Mr. Tim Clower, representing Norwest Bank, apologized for communication problems they
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Regular Council Meeting
February 10, 1998
Page 16
had had regarding this zoning case. He explained that the company that was going to be the tenant
has withdrawn their lease from this property; therefore, he said it would not be necessary to seek the
"I-2" zoning for the warehouse use. He asked that the Council consider rezoning the property to "B-
1" Neighborhood Business District, and he added that there are mixed zoning uses all along that
portion of South Padre Island Drive. Mr. Clower said if they were to have another use for the
property at a later time, they would meet with representatives of Friendship Baptist Church to
discuss the issue.
Mr. Tom Utter, Assistant City Manager for Development Services, said staff would
recommend rezoning the property to `B-1" as Mr. Clower suggested. He explained to Rev. Miller
the types of uses allowed in `13-1." Mayor Neal asked Rev. Miller if he concurred with that
recommendation, and Rev. Miller indicated that he did.
Council Member Gonzales made a motion to amend Item 5 to rezone the subject property
to "B-1" only; the motion was seconded by Council Member John Longoria, and it passed (Garcia
and B. Longoria absent).
City Secretary Chapa polled the Council for their votes as follows:
5. ORDINANCE NO. 023205
Amending the Zoning Ordinance upon application by Norwest Bank Texas, South Central,
by changing the zoning map in reference to 2.56 acres out of Lot 2, Baldwin Moore Farm
Lots from "R -1B" One -Family Dwelling District to "B-1" Neighborhood Business District.
An emergency was declared and the foregoing ordinance passed, as amended, by the
following vote: Colmenero, Cooper, Gonzales, J. Longoria, Martin, McNichols, and Neal
voting "Aye"; Garcia and B. Longoria absent.
*************
Mayor Neal announced the closed session, pursuant to Texas Government Code Section
551.071 regarding the following: Kelly Lewis Jr. v. City of Corpus Christi, et al, Cause No. 94-
1650-B, 117th District Court, Nueces County, Texas, with possible action in open session later in
the Council meeting; and regarding collective bargaining with Corpus Christi Firefighters
Association.
The Council went into closed session.
The Council returned from closed session.
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Regular Council Meeting
February 10, 1998
Page 17
Mayor Neal made the following motion, which was seconded by Council Member Garcia.
City Secretary Chapa polled the Council for their votes as follows:
K. M98-022
Motion authorizing the City Manager to execute a contract for legal services with the law
firm of Meredith, Donnell & Abemethy to represent the City of Corpus Christi in the second
trial of Kelly Lewis Jr. v. City of Corpus Christi, et al, Cause No. 94-1650-B, 117th District
Court, Nueces County, Texas, at an hourly rate of $125, subject to appropriation.
The foregoing motion passed by the following vote: Colmenero, Cooper, Garcia, Gonzales,
J. Longoria, McNichols, and Neal voting "Aye"; B. Longoria and Martin absent.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 6, Year 2000 options.
Mr. Jorge Cruz-Aedo, Director of Finance, said the city has determined that the existing
computer system and software is not compliant for the Year 2000. As such, the city has begun the
process for determining options for replacement of these systems. He said in order to finance that
replacement, staff is recommending that certificates of obligation (COs) with a tax and revenue
pledge be issued.
He discussed eligible revenues that were identified as follows: tourist and convention
revenues; airport parking and lease revenues; aquarium revenues; municipal hotel occupancy tax;
golf center; stormwater revenues; and solid waste revenues. He said many of those revenue streams
have certain restrictions or the revenues are insufficient to warrant serious consideration as a pledge.
Consequently, staff recommends that they capture the portion of the solid waste revenues which are
currently going to the General Fund and dedicate them as a pledge for this debt issue. Mr. Cruz-Aedo
said they are anticipating an authorization in an amount not to exceed $10 million, which includes
the cost of replacing approximately half of the city's personal computers because they are not Year
2000 compliant.
Responding to Mayor Neal, Mr. Cruz-Aedo said any adjustment to the debt service places
pressure on the property tax rate, but they are hoping that there will also be an increase in assessed
valuations. Mr. Hennings pointed out that they were not talking about spending the solid waste
revenues but rather pledging them for 10 years. He said they would budget how they will provide
for the debt service as part of the annual budget process, and it will be close to $1 million for the
General Fund portion. Mr. Cruz-Aedo said the total budgeted solid waste revenues for FY 1997-98
are approximately $19 million, and about 20% of that goes to the General Fund.
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Regular Council Meeting
February 10, 1998
Page 18
Mayor Neal asked about a leasing option. Mr. Cruz-Aedo said that leasing would be more
expensive to the city (higher interest rate and shorter term); in addition, certain software cannot be
lease -purchased. He reiterated that the solid waste plan would not be altered.
Council Member Martin asked if this funding could be done as straight property tax -
supported certificates of obligation, and Mr. Cruz-Aedo said that was correct. Mr. Jeff Leuschel,
bond counsel, said the reason the revenue is pledged in combination is so the city can sell the COs
for cash; a tax -supported CO could not be sold for cash. A brief discussion ensued. Mr. Martin asked
if this would cause an approximate 10 tax increase, and Mr. Hennings replied that while that is an
option, he thought it was too early to make that determination. He noted that there is some
anticipated growth in the tax base as well as the effect of the Crime Control and Prevention District
revenues taking pressure off the Police Department budget. There was further discussion. Mr.
Hennings added that staff would prepare a 10 -year life cycle cost analysis, which would put this
information in a better perspective.
In reply to Council Member Garcia, Mr. Cruz-Aedo further commented on why other
revenue sources would not be applicable to this recommended use. Mr. Garcia said that he had
accompanied some staff members in investigating computer systems in other cities, which was
beneficial and can help the city save money in the long run.
Mr. Martin asked if staff was proceeding with the audit of the solid waste plan, and Mr.
Hennings replied affirmatively. Mr. Martin also referred to further study of the departments.
Mayor Neal called for comments from the audience.
Mr. J.E. O'Brien, 4130 Pompano, said that none of the options presented appear to be very
appealing. He said that approval of the proposed tax and revenue certificates of obligation would
increase the property tax between 1.20 and 1.30 per $100 valuation, minus any increased revenue
from increased valuation. He questioned why general obligation bonds could not be used, pointing
out that they would need voter approval. Mr. O'Brien also asked if any consideration had been given
to possibly "farming out" the city's computer work. He questioned the status of the 9-1-1 fees and
asked if those funds could be used to fund a portion of the debt service for the Municipal Court
computer replacement. He added that he has not seen any reduction in spending to help pay for the
cost of the computer systems.
Mr. Ed Bell, representing Y2K Research Company, said it was important for the city to
continue the process of making its computer systems Year 2000 compliant, and he offered the
services of his company in that effort.
Mr. Hennings said they would ask that the Council adopt a motion instructing staff to prepare
an ordinance to bring back to the Council in the next two weeks that would set in motion the process
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Regular Council Meeting
February 10, 1998
Page 19
of developing the notice of intent, the preliminary official statement and the usual documents that
are needed to issue certificates of obligation. Mr. Garcia made the motion as stated by Mr. Hennings,
and it was seconded.
Responding to Mr. Martin, Mr. Cruz-Aedo said staff would ask that they be instructed to
bring to the Council an amount not to exceed $10 million, with the intention of bringing the exact
amount when the sale occurs. Mr. Martin asked if there would be specific item -by -item estimates
before the sale of the COs, and Mr. Hennings said that was correct.
City Secretary Chapa polled the Council for their votes on the motion as stated, and it passed
by the following vote: Colmenero, Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye";
Cooper, B. Longoria, and McNichols absent.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 7, capital improvement program (CIP) financing.
In reply to a question from the Mayor, Mr. Cruz-Aedo said staff was recommending that a
sale of $7,554,560 in commercial paper notes be sold at this time. He explained that there are
$57,195,000 of capital improvement projects, and they are asking for appropriation authority for
$50,000,000, which is the amount of the commercial paper program, and they are anticipating selling
$256,362 for issuance costs. Mr. Hennings pointed out that this proposal does not approve any
engineering and construction contracts, which will have to come back to the Council for their
approval.
Council Member Martin said he thought there would be an additional action item authorizing
the specific sale of a certain amount of monies at this point. He emphasized that as part of the
commercial paper program, the Council wanted to make the decisions on the priority of the projects
and, in particular, they wanted a list of the projects being financed through the first issuance of the
notes. Mr. Cruz-Aedo said the first issue involved costs to initiate the commercial paper program
with a "pre -sale" of sorts.
Mr. R.H. Shackelford, Director of Engineering Services, pointed out that over the past
several months money has, on occasion, been advanced from other projects in order to continue the
CIP. He said this first issuance involves repaying all the loans made from other projects, as well as
providing the anticipated required cash flow for projects that were approved in prior years for which
funds are now needed. He added that this follows the approved capital budget the Council took
action on in December. A discussion ensued.
Mr. Leuschel explained that when the City Council approved the ordinance establishing the
commercial paper program, the ordinance delegated to authorized representatives the ability to sell
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Regular Council Meeting
February 10, 1998
Page 20
the commercial paper notes. The policy that was adopted concurrently with the ordinance provided
that the City Council would provide input and direction to staff to use that authority under the
ordinance.
Mr. Martin then made a motion to amend Item 7 to direct staff that, if in their judgment it is
appropriate to sell notes at this time in the amount of $7,554,560, staff is directed to do so. Mr.
Garcia seconded the motion to amend, and it passed.
Mayor Neal called for comments from the audience.
Mr. J.E. O'Brien said he thought it was very unfair to the Council that a $50 million item was
brought up seven hours into a Council meeting, as well as staff presenting the Council with materials
that they had not yet seen. He also questioned passing this item on an emergency reading, saying that
there was a lot of information that the Council could discuss further. Mr. O'Brien added that he was
not convinced this program would save the city money.
City Secretary Chapa polled the Council for their votes as follows:
7.a. M98-024
Motion approving financing for $50 million from the $57 million Capital Improvement
Program Budget for Water, Wastewater, and Stormwater.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
7.b. ORDINANCE NO. 023206
Ordinance appropriating $50,000,000 from the sale of commercial paper, $21,300,000 in the
No. 805 Commercial Paper-Water-CIP Fund, $26,770,000 in the No. 850 Commercial Paper-
Wastewater-CIP Fund, and $1,930,000 in the No. 895 Commercial Paper-Stormwater-CIP
Fund to fund various eligible water, wastewater, and stormwater projects on the FY 97-98
Capital Improvements Project List.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B.
Longoria, and McNichols absent.
7.c. RESOLUTION NO. 023207
Resolution expressing official intent to reimburse costs of various water, wastewater, and
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Regular Council Meeting
February 10, 1998
Page 21
stormwater improvements authorized by the Fiscal Year 1997-98 Capital Improvement
Program Budget.
The foregoing resolution passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
* * * * * * * * * * * * *
Mayor Neal called for consideration of consent motions, resolutions, ordinances and
ordinances from previous meetings on Items 8 through 21, and Council members requested that
Items 11, 13, and 19 be withheld for discussion; there were no comments from the audience. City
Secretary Chapa polled the Council for their votes and the following were passed:
8. M98-025
Motion approving the purchase of one vehicle mounted aerial device (bucket truck) in
accordance with Bid Invitation No. BI -0068-98 from Commercial Body Corporation, San
Antonio, Texas for the amount of $91,817. The award is based on low bid. The vehicle will
be used by Facilities Maintenance and is budgeted in FY 1997-98 to be funded through the
City's lease/purchase contract with GE Capital.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, and Neal voting "Aye"; Martin voting "No"; Cooper, B. Longoria, and McNichols
absent.
9. M98-026
Motion approving a maintenance agreement for electronic monitor/defibrillators with
Physio -Control Corporation, based on sole source, for the total amount of $15,367.49. The
term of the contract is twelve months. The maintenance agreement is for the cardiac
monitor/defibrillators used by Emergency Medical Services.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
10. M98-027
Motion approving a supply agreement for approximately 28,100 tons of flexible base caliche
with Redland Stone Products, Inc., Corpus Christi, Texas, based on the low bid of $186,561.
The term of the contract will be 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
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Regular Council Meeting
February 10, 1998
Page 22
Manager or his designee. This material will be used by the Street, Utility Departments and
Elliott Landfill. Funds have been budgeted in FY 97-98 by the using departments.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
12. M98-029
Motion approving a supply agreement for approximately 118,000 pounds of pavement
marking glass spheres in accordance with Bid Invitation No. BI -0077-98 with Swarco
Industries, Columbia, Tennessee, for an estimated annual expenditure of $21,782.80 based
on low bid. The term of the agreement 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. This item will be used by Street Services to mix with traffic
marking paint to make the paint reflective. Funds have been budgeted by Street Services in
FY 97/98.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
14. M98-031
Motion approving the purchase of 6,000 gallons of larviciding oil (GB -1111) from Golden
Bear Oil Specialties, Bakersfield, California for a total of $15,120 based on sole source. This
chemical will be used by the Health Department's Vector Control for the control of
mosquitos. Funds have been budgeted in FY 97/98.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
15. M98-032
Motion authorizing the City Manager or his designee to execute a contract in the amount of
$402,150 with Shiner, Moseley & Associates, Inc. for the O.N. Stevens Water Treatment
Plant Sludge Lagoons and Pre -Sedimentation Basin Rehabilitation Project.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
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Regular Council Meeting
February 10, 1998
Page 23
16. M98-033
Motion authorizing the City Manager or his designee to execute a Contract for Engineering
and Consulting Services with Price Consulting, Inc. for a total fee not to exceed $15,700 for
the Workforce Development Corporation Building Weatherization - Phases I and II.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
17. ORDINANCE NO. 023208
Ordinance authorizing the City Manager or his designee to execute a Rider 17 Interlocal
Contract with the Texas Natural Resource Conservation Commission, which will provide a
grant of $283,750 for air quality planning activities in Nueces and San Patricio Counties.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B.
Longoria, and McNichols absent.
18.a. 0 INANCE NO. 023209
Ordinance authorizing the City Manager or his designee to execute an Interlocal Agreement
with the Coastal Bend Council of Governments, that will fund public service announcements
for Solid Waste Services.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B.
Longoria, and McNichols absent.
18.b. ORDINANCE NO. 023210
Ordinance appropriating $8,400 in the Federal/State Grants Fund No. 162, received from the
Coastal Bend Council of Governments, as a pass-through grant from the Texas Natural
Resource Conservation Commission, to develop public service announcements for Solid
Waste Services.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B.
Longoria, and McNichols absent.
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Regular Council Meeting
February 10, 1998
Page 24
20. ORDINANCE NO, 023211
Authorizing the City Manager or his designee to execute a twenty year lease agreement with
the Instituto de Cultura Hispanica for the Lichtenstein House in Heritage Park, Lots 5 and
6, Block 70, Beach Portion, Corpus Christi, Texas, to use as their business office and
educational center, in consideration of monthly rent of $300.
The foregoing ordinance passed on second reading by the following vote: Colmenero,
Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and
McNichols absent.
21.a. ORDINANCE NO, 023212
Authorizing the City Manager or his designee to execute a twenty year lease with the Camp
Fire Council of Corpus Christi Area, Inc. for the Gugenheim House in Heritage Park, Lots
1 and 2, Block 70, Beach Portion, Corpus Christi, Texas to use as their business office and
as meeting space in consideration of monthly rent of $210, which may be partially or fully
offset by services rendered to the City and will be renegotiated every five years.
The foregoing ordinance passed on second reading by the following vote: Colmenero,
Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and
McNichols absent.
21.b. ORDINANCE NO. 023213
Authorizing the City Manager or his designee to execute approximately a four-year lease,
terminating May 31, 2001, with the Junior League of Corpus Christi, Inc. for the Sidbury
House in Heritage Park, Lots 3 and 4, Block 70, Beach Portion, Corpus Christi, Texas to use
as a historical restoration of an early Corpus Christi home in consideration of monthly rent
of $310, which may be partially or fully offset by services rendered to the city.
The foregoing ordinance passed on second reading by the following vote: Colmenero,
Garcia, Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and
McNichols absent.
Mayor Neal opened discussion on Item 11, purchase of traffic signals.
Responding to Council Member Martin, Mr. Carl Crull, Assistant City Manager for Public
Works and Utilities, explained that the items to be purchased are components, such as signal heads
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Regular Council Meeting
February 10, 1998
Page 25
for maintenance work, but are not full signals. City Secretary Chapa polled the Council for their
votes as follows:
11. M98-028
Motion approving the purchase of 130 traffic signals, 40 pedestrian signals, 100 push button
assemblies and various related traffic signal components from the following companies for
the following amounts in accordance with Bid Invitation No. BI -0070-98, based on low bid
for a total of $92,288.10. Funds have been budgeted in FY 97-98 by the Street Department.
Texas Highway Products Corp. Consolidated Traffic Controls, Inc. Traffic Parts, Inc.
Round Rock. TX Arlinuton TX Spring, TX
Items 3 & 4 Items 12 & 13 Item 6
$34,700 $22,407.50 $3,525
Paradigm Traffic Systems, Inc.
Fort Worth. TX
Items 1,7-11
$17,068.10
Naztec, Inc.
Suearland TX
Item 2
$3,187.50
Grand Total: $92,288.10
Econolite Control Products, Inc.
Tomball. TX
Item 5
$11,400
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 13, supply agreement for cement.
In reply to Council Member Garcia, Mr. F.D. Glenn, Purchasing Agent, explained that for
an item such as cement staff sends out bids to many different companies that may or may not bid.
Mr. Hennings replied that four bids were received in this case and the spread on the lower three were
tight, which appears there was competition. A brief discussion ensued. City Secretary Chapa polled
the Council for their votes as follows:
13. M98-030
Motion approving a supply agreement for approximately 1,100 bags of Portland Type I
Cement, 1,600 bags of Mortar Mix, and 3,500 bags of Concrete Mix in accordance with Bid
Invitation No. BI -0063-98 with MG Building Materials, Corpus Christi, Texas, for an
estimated annual expenditure of $16,574 based on best and low bid. The term of the
agreement 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
Minutes
Regular Council Meeting
February 10, 1998
Page 26
designee. These items will be purchased for Warehouse Inventory and charged out to
various using departments throughout the City. Funds have been budgeted in FY 97/98.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, J.
Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols absent.
*************
Mayor Neal opened discussion on Item 19, lease for submerged land.
Council Member Garcia asked if the lessee was current on their rent. Mr. Utter replied that
they are and continue to be current. He explained that the $200 per month rent is for the bay bottom;
the building belongs to the Johnsons and the building is encroaching on city water area. He said staff
intends to have activity there.
City Secretary Chapa polled the Council for their votes as follows:
19. FIRST READING ORDINANCE
Authorizing the City Manager or his designee to execute a five-year lease with the Johnson's
Survivor Trust, Leo E Johnson, Trustee, for approximately 3,540 square feet of submerged
land adjacent to Lot 2, Block G, Brooklyn Addition, in consideration of payment of the
greater of $200 per month or 1% of monthly gross sales.
The foregoing ordinance passed on first reading by the following vote: Colmenero, Garcia,
Gonzales, J. Longoria, Martin, and Neal voting "Aye"; Cooper, B. Longoria, and McNichols
absent.
* * * * * * * * * * * * *
Mayor Neal called for the City Manager's report. Mr. Hennings announced that on February
12th the Minority Business Opportunity Committee will have a presentation on the owner -controlled
insurance program; there will also be a public hearing on the location of the Westside Neighborhood
Medical Clinic. The public hearing will be held at West Oso High School Auditorium at 7:00 p.m.
on February 12th. He said this is a project that the city has agreed to fund with Community
Development Block Grant funds, and there have been discussions about locating the clinic on
Greenwood or in the West Oso School District. Council Member Gonzales said he thought the
location had already been determined. Mr. Hennings replied that since the City Council will have
to approve the project, the Council will have the opportunity to review the decision of the Hospital
District Board. Dr. Gonzales expressed concern about holding the public hearing if the decision on
the location has already been made.
Minutes
Regular Council Meeting
February 10, 1998
Page 27
Mr. Hennings also said that items scheduled for next week's Council meeting included: a
presentation by the Human Relations Commission on their plans for proposing a revision of the fair
housing ordinance; the quarterly update from the Greater Corpus Christi Business Alliance;
consideration of a recommendation from the Senior Community Services Advisory Committee on
a site for the new southside senior center; and contracts for engineering services for design of the
repairs to the Wesley Seale Dam. He also gave an update on the effluent diversion project, saying
that staff will ask for a delay on the hearing of that issue at the Texas Natural Resource Conservation
Commission. On February 24th a presentation is scheduled about the preparation of a disparity study
that would support special emphasis by the city on minority and women -owned businesses.
Mayor Neal asked staff to schedule an agenda item on the "Herbie the Curbie" issue. He then
called for Council concerns and reports.
Dr. Gonzales expressed concern about continuing problems with people speeding throughout
the city. He also referred to Item 14 from the January 27, 1998 Council meeting pertaining to
professional representation on legislative and policy issues, a consent item which was amended
during the meeting.
Mr. Garcia echoed Dr. Gonzales' comments regarding the Hospital District Board. He said
many people had read an article in the newspaper and made an assumption that the decision about
the site of the new clinic has been made. He requested demographics information on that issue.
Mr. Hennings suggested that the Council instruct staff to tell the Hospital District Board that
the Council would like to hear a recommendation supported by the data on the site location before
they proceed any further with the project. Dr. Gonzales said the question is whether the clinic will
be placed in an area that can meet more people's needs. Mr. Martin said the Hospital Board should
address the Council directly on that issue.
Mr. Longoria said that the Hospital Board had a meeting last week and originally had not
planned to hold a public hearing until he and Council Member Betty Jean Longoria intervened. He
said Mr. Utter was sent to the meeting to ask the board to conduct a public hearing on the matter.
Responding to Mr. Martin, Mr. Hennings said money has been allocated in the budget for
the CDBG program, but staff has yet to bring a contract to the Council for actual construction of the
clinic project. Mr. Longoria pointed out that a public hearing was held last year as part of the CDBG
program.
Mr. Garcia made a motion to inform the Nueces County Hospital District Board to bring their
recommendation for a site for the Westside Medical Clinic to the City Council. The motion was
seconded by Mr. Colmenero and it passed (Cooper, B. Longoria, and McNichols absent.)
Minutes
Regular Council Meeting
February 10, 1998
Page 28
Mr. Garcia also referred to personnel issues at the Aviation Department, and Mr. Hennings
said he would provide a report.
Mr. Colmenero commented on an erroneous media story, and he suggested that there be an
orchestrated method of disseminating information to the media. He also reported a problem with
speeding vehicles on residential streets.
Mr. Martin requested a report ahead of time on the Human Relations Commission
presentation. He also asked about the requirement to reconsider an item. Mr. Bray replied that the
motion has to be made by a Council member on the prevailing side, and then it takes a two-thirds
vote of those present and voting to approve the motion to reconsider, which brings it back just before
the action was taken.
Mr. Longoria referred to a memo from Police Chief Alvarez about the speeding issue, and
he suggested that staff consider a plan to address that issue. Mr. Longoria also commented on a
newspaper article about reformulated gasoline. Mr. Hennings said that article was erroneous, and
he said that reformulated gasoline has been used in Corpus Christi for years, and the city purchases
it and uses it in the city fleet, as well as in other fleets. He said reformulated gasoline is an issue
being addressed by TNRCC.
Responding to Dr. Gonzales, Mr. Bray said that under the Council's rules, a motion to
reconsider can be done up to the next regular meeting of the Council. He added that even if a
proposal was the same, it could be brought forward as new business. If it required a hearing process,
they would have to go through the hearing process again.
There being no further business to come before the Council, Mayor Neal declared the
Council meeting adjourned at 9:45 p.m. on February 10, 1998.
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