Loading...
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. ************* 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 Minutes 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. * * * * * * * * * * * * * Minutes 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. Minutes 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 Minutes 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. Minutes 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 Minutes 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 Minutes Regular Council Meeting February 10, 1998 Page 8 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 Minutes Regular Council Meeting February 10, 1998 Page 9 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 Minutes 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. Minutes Regular Council Meeting February 10, 1998 Page 11 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 Minutes Regular Council Meeting February 10, 1998 Page 12 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. Minutes 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 Minutes 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. Minutes 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 Minutes 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. Minutes 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. Minutes 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 Minutes 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 Minutes 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 Minutes 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 Minutes 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. Minutes 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. Minutes 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 Minutes 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. * * * * * * * * * * * * *