HomeMy WebLinkAboutMinutes City Council - 12/15/1998I 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 December 15, 1998, which were approved
by the City Council on January 12, 1999.
WITNESSETH MY HAND AND SEAL, this 12th day of January, 1999.
Armando Chapa
City Secretary
SEAL
MINUTES
CITY OF CORPUS CHRISTI, TEXAS
Regular Council Meeting
December 15, 1998
2:00 p.m.
PRESENT
Mayor Samuel L. Neal Jr.
Mayor Pro Tem John Longoria
Council Membera:
Javier D. Colmenero
Melody Cooper*
Alex L. Garcia Jr.
Dr. Arnold Gonzales
Betty Jean Longoria
Edward A. Martin
Dr. David McNichols
City Staff:
City Manager David R. Garcia
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 Rev. E.F. Bennett (retired), following which the Pledge of
Allegiance to the flag of the United States was led by Council Member McNichols.
City Secretary Chapa called the roll and verified that the necessary quorum of the Council
and the required charter officers were present to conduct the meeting. Mayor Neal called for
approval of the minutes of the regular Council meeting of December 8, 1998, A motion was made
and passed to approve the minutes as presented.
* * * * * * * * * * * * *
Mayor Neal referred to the presentation on the day's agenda. Mrs. Yvonne Haag, Assistant
to the Mayor, discussed plans for the 10th annual H -E -B "A Feast of Sharing" holiday dinner. She
introduced the members of the Mayor's Planning Committee for the event. Two of the committee
members, Mrs. Debbie Lindsey -Opel and Mr. Dee Haven, described some of the details of the
dinner, which is anticipated to serve 10,000 people.
* * * * * * * * * * * * *
Mayor Neal called for petitions from the audience.
Mr. Phil Rosenstein referred to the November 17, 1998 Council meeting during which Mayor
Neal had asked that Mr. Rosenstein be removed from the Council Chambers following comments
Mr. Rosenstein had made to the Council. Mr. Rosenstein said during the December 15th meeting that
Mayor Neal violated the rules of decorum and the Ethics Code, which he cited. Mr. Rosenstein
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Regular Council Meeting
December 15, 1998
Page 2
added that he is disappointed that no one on the Council agrees with his contention that he was
wrongfully ejected from the November 17th Council meeting.
Mr. J.E. O'Brien, 4130 Pompano, said he understood that the three pump stations for the
Mary Rhodes Pipeline have yet to be accepted, and he questioned whether the current use of the
pipeline will have any legal ramifications regarding the warranty or the contract guarantee. Mr. Carl
Crull, Assistant City Manager for Public Works and Utilities, replied that the pipeline is in use and
the city has issued to the various contractors notices of substantial completion, which means that the
operating entities can assume operation of the facility. He said that does not abrogate them from any
responsibility with regard to the completion of the "punch -list" items, the final acceptance testing,
or the one-year warranty program. He said that since final acceptance of the pipeline has not been
made, the one-year warranty program is not yet in effect. Mayor Neal asked if this was standard
procedure, and Mr. Crull said it is standard on many contracts.
Mr. Isaac Valencia, President of the Corpus Christi Police Officers Association, said the POA
supported the creation of the Crime Control and Prevention District and its goal of adding a net
number of officers to the Police Department. He said the City Manager's plan to reduce the city's
budget includes a deferral of five officers to the second police academy in 1999. He said that
deferment slows down the process of adding officers to the force and the POA objects to that
proposal. City Manager Garcia said that staff is attempting to locate approximately $500,000 in
reductions in the Police Department. He reiterated that the total number of police officers that were
committed as part of the Crime Control District will be there on schedule. Mr. Garcia said the
proposed reductions are reasonable, and he added that there are administrative efficiencies that can
be achieved in both the Police and Fire Departments.
Mr. Abel Alonzo, 1701 Thames, commended the City Manager for attempting to operate the
city in the most efficient manner. He said the Greater Corpus Christi Business Alliance lost $77,000
last year on two projects, which he said could have been used to hire another police officer or
firefighter. He added that the Alliance is not inclusive and diverse and he urged the City Manager
to include the Alliance in his budget -cutting proposals.
*Council Member Cooper arrived at 2:25 p.m.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 2, a hearing request on Central Power and Light
Company's electricity rates.
The Mayor read from a prepared statement in which he gave a brief history of the issue
involved. He explained that there was no state regulation of utility rates in Texas before 1976; prior
to that time, rates within city limits were regulated by City Councils. Most city charters provided
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Regular Council Meeting
December 15, 1998
Page 3
that a utility company requesting a rate increase would reimburse the city for its reasonable costs in
the rate proceeding, which included employment of rate experts.
The Mayor said that in 1975, the Legislature enacted statewide regulation of utility rates,
which places initial jurisdiction over electric rates in City Councils. However, decisions of the
Council are appealed to the Public Utility Commission, which has final authority. The state law also
requires an electric utility to reimburse cities for their reasonable rate case expenses. This enables
cities to employ necessary experts to meaningfully participate in rate cases.
Mayor Neal stated that since enactment of the state law, Corpus Christi has repeatedly joined
with other cities in the CPL service area, which includes more than 100 cities, to participate in
electric rate cases. For 16 years, the CPL cities have used a law firm formed by Don Butler, a former
City Attorney for Austin. The firm, now called Butler, Porter, Gay & Day, specializes in vigorously
representing cities in utility regulation. It represents hundreds of cities in cases involving not only
CPL, but also West Texas Utilities, Texas Utilities Electric Company, Lone Star Gas Company,
Texas -New Mexico Power Company, Entergy Gulf States, and Southwestern Bell Telephone
Company. Some of its representative clients include Dallas, Fort Worth, Arlington, Lewisville,
Plano, Irving, Grand Prairie, Waco, Beaumont, Port Arthur, Abilene, Fort Stockton, McAllen, and
Victoria.
In recent cases, said the Mayor, the lawyer from the Butler firm representing CPL cities has
been Geoffrey Gay. Prior to joining the firm in 1988, Mr. Gay was appointed director of the Office
of Public Utility Counsel of the PUC by Governor Mark White. In that position, he represented the
interest of residential ratepayers. Before that he was an assistant attorney general for Texas and
deputy consumer advocate for West Virginia. He has a masters degree from Rice University, as well
as a law degree from the University of Houston, and is listed in "Best Lawyers in America." Mr. Gay
has had a direct role in advocating positions on behalf of cities that have saved consumers over $2
billion.
Mayor Neal went on to say that presently Corpus Christi is participating in two significant
cases at the PUC which are interrelated. The first is a rate case filed by CPL several years ago which
resulted in significant rate reductions for consumers, and CPL has appealed from the PUC to court.
The second is a case asking the PUC to approve a merger of CPL's parent company. Mr. Gay and
the CPL Cities Steering Committee are recommending a settlement of the merger case, which would
also partially settle the rate case, which they believe would significantly benefit ratepayers.
The Mayor said the issue before the Council at that meeting is whether to adopt the resolution
recommended by the City Manager, which approves the settlement and denies initiation of a new
rate case at this time. Mayor Neal then outlined the format for the presentations, consisting of 30
minutes for Mr. Gay and 30 minutes for Mr. Jose Marroquin and his representative, followed by
questions from the Council members and comments by audience members.
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Regular Council Meeting
December 15, 1998
Page 4
In his presentation, Mr. Gay referred to a summary of cities' involvement in recent CPL rate
matters. He explained that Docket No. 12820 was a case initiated by the cities which led to a
stipulation with CPL resulting in a $50 million refund and a disallowance of fuel costs of $62.5
million. For the sake of comparison, he said the economic value of the stipulation that the Council
will be considering is more than double the economic value of the stipulation in Docket No. 12820.
Mr. Gay also explained the rate case under Docket No. 14965. He said in that case CPL
alleged a revenue deficiency of $70.8 million and the cities' position was that rates should be
reduced by $55 million. The PUC ultimately awarded a $21 million rate reduction. In addition,
Docket Nos. 16995 and 19502 dealt with the issue of interruptible rates, as did Docket No. 14965.
Mr. Gay said the PUC has ordered increases in interruptible rates effective in 1999 and 2000, and
he said there is no way the PUC will permit that issue to be reopened.
Mr. Gay then discussed the proposal presently before the Council, known as the merger
stipulation under Docket No. 19265 involving Central and South West Corporation (CPL's parent
company) and American Electric Power Company (AEP). He said the settlement agreement
guarantees a rate reduction of $19 million regardless of legislative action, and it requires CPL to drop
its appeal of the glide -path reductions from Docket No. 14965. CSW has also agreed that if the
merger terminates and the cities initiate a rate case, rate reductions will be made retroactive to
August 1, 1999. Mr. Gay said he believes there is no way that a rate case initiated by this City
Council (or any city in CPL's service territory) will lead to rate relief sooner than August 1999.
Mr. Gay's second chart illustrated the economic value of the six-year merger deal, which
totals $264 million. Mr. Gay also referred to a comparison of the ratepayers' share of the net merger
savings under the stipulation versus the company's proposal.
Mr. Gay also described other key elements of the stipulation: CPL cannot request a rate
increase before January 1, 2003; there are incentives to increase off -system sales and to reduce fuel
costs to the benefit of ratepayers; there are limitations on the applicability of automatic adjustment
clauses (PCRF); CPL has promised that the quality of service will be at least equivalent to that
provided in the recent past, and they will enact quality -of -service standards; and there is a measure
of protection against possible market risks from the merger.
Mr. Gay addressed the issue of the $69 million "golden parachute" (change -in -control)
payments arising from the merger of CSW and AEP. He emphasized that not one penny of those
payments can be used to increase or decrease rates and they are not reflected in the calculation of net
merger savings. Mr. Gay also indicated that change -in -control agreements are a standard business
practice and are borne solely by the shareholders, who benefit when the stock value increases as a
result of the merger. He noted that the change -in -control agreements were created by the CSW board
to encourage senior executives to find a suitable purchaser to enhance the company's stock value.
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Regular Council Meeting
December 15, 1998
Page 5
Mr. Gay then explained why the stipulation is preferable to a rate case. He said the PUC will
not welcome a rate case and a rate case order would have to find over earnings greater than $33
million to exceed the value of the stipulation. Also, a rate case order would likely allocate a
substantial portion of ratepayer dollars to write-down potential stranded costs, and it cannot protect
ratepayers against a potential refund of the 1998 and 1999 glide -path reductions. He added that
legislation will likely moot any rate case but not the stipulation.
At the conclusion of this presentation, Mr. Gay rebutted several specific allegations relating
to this issue. He said that a settlement is not in the economic best interest of the cities' consultants
or lawyers, although it is in the best interest of ratepayers. Also, he said that AEP is regarded as a
low-cost provider and rejection of the merger could lead to CSW's acquisition by a high-cost
provider. Mr. Gay noted that all issues involving interruptible rates and interclass subsidization have
been fully litigated.
Referring to concerns raised by Mr. Marroquin, Mr. Gay pointed out that virtually all electric
utilities have summer -winter price differentials, and he feels that the PUC will not consider that
issue. He said that purchasing power at time of peak is not a realistic or affordable option for CPL,
and in a rate proceeding the PUC would make weather -normalization adjustments. Mr. Gay also
stated that the assertion of city original jurisdiction over CPL's fuel costs will fail; and he said that
current CPL rates compare favorably to rates of other large, publicly held electric utilities. He added
that the stipulation does not indicate how stranded costs on the CSW system are to be addressed.
Responding to Council Member Garcia, Mr. Gay said that Texas ratepayers cannot be
obligated through some complex affiliate transactions to pick up any potential stranded costs that
are assignable to the AEP system. He added that all the stranded costs that exist on the CSW system
reside in CPL's South Texas Nuclear Project.
Mr. Garcia asked how the stipulation may affect the renewal of CPL'S franchise agreement
with the City of Corpus Christi. Mr. Gay replied that there is nothing in the stipulation that impacts
the franchise arrangement, either positively or negatively. He added that this issue is before the City
Council at this time due to the request to proceed with a rate case. He said he has signed the
stipulation on behalf of the Steering Committee Member Cities pending approval of the various City
Councils. He said CPL can interpret that they have no binding agreement with the cities until all
those that Mr. Gay represents pass resolutions approving the stipulation.
In reply to other questions from Mr. Garcia, Mr. Gay said that if the City Council initiates
a rate case, he believes that the stipulation is voided and there is some possibility that AEP will walk
away from the merger because of the complexities involved in a rate case. He reiterated that there
is a commitment by the company in the stipulation that the quality of service will be as great as
today or greater in the future, and the company would not be able to cut many employees and
achieve that result. In addition, the merger has nothing to do with operational savings. He said the
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Regular Council Meeting
December 15, 1998
Page 6
bottom line is that this stipulation provides more relief to ratepayers sooner than proceeding with a
rate case, and he encouraged the Council to adopt it.
Responding to Council Member Gonzales, Mr. Gay referred to a chart comparing the
residential bills for three electric utility companies: CPL, Houston Lighting and Power, and Texas
Utilities Electric Company. The bills compare 1,000 kWh of usage during the months of April,
August, and November in 1997 and 1998. He noted that the average consumer on CPL's system
consumes less power than the average residential consumer on HL&P's or TUEC's systems.
The next presentation was made by Mr. Glynn Pugh. He said he worked as a CPA for 25
years, as a lawyer for 50 years, and as an auditor of public utility companies for several years. He
said as a consumer advocate, he does not receive a fee for the legal work he performs on behalf of
residential and commercial ratepayers. Mr. Pugh said he represents Mr. Marroquin, who seeks a rate
case that he initiated before the City Council about three months ago. Mr. Pugh said Mr. Marroquin
expressed his regret at not being able to attend the hearing that day due to a family situation.
Mr. Pugh said the stipulation contained in the Council members' agenda material was signed
on November 3, 1998. He said at that time it was a good stipulation for the ratepayers and the merger
was on a fast track. However, he said, the merger was removed from the fast track and the Federal
Energy Regulatory Commission ruled that it would inquire into the value of this merger for
consumers. He said the FERC has scheduled hearings beginning June 7, 1999, with a decision to
follow possibly in December 1999.
Mr. Pugh noted that HB 349 in the Texas Legislature proposes to reduce electric rates
statewide by 12%, which could supersede the 2% reduction being considered before the City
Council. He questioned why the merger savings could not offset CPL's stranded costs in the South
Texas Nuclear Project. Mr. Pugh said the City Council should delay taking action for 30 days to
allow the attorney to negotiate a better deal and to acquaint the Council with some of the changes
that have taken place since the stipulation was originally signed on November 3`d.
Mr. Pugh also referred to some of the issues addressed by Mr. Gay. Mr. Pugh said there is
no point in debating the issue of quality of service because even though CPL's rates are high, they
provide good service. He said he believes CPL's quality service will remain after the merger. Mr.
Pugh also said the Council should not be concerned about potential job losses. He then discussed the
change -in -control payments, saying that the $69 million will get passed on to consumers as part of
costs because there is a monopoly.
Mr. Pugh said Mr. Gay's chart showing residential rates for 1997 and 1998 for three electric
utility companies is not a fair comparison because in April 1997 an 81/2% interim increase was
awarded to CPL, which was subsequently eliminated in 1998. Mr. Pugh added that CPL's peak
season rates are set too high and he and Mr. Marroquin are seeking to have those peak rates reduced.
Minutes
Regular Council Meeting
December 15, 1998
Page 7
He also discussed the difference between industry interruptible rates and residential firm
rates, and said that there is an urgency associated with Mr. Marroquin's case because he is
attempting to lower the peak season rates for July, August, September, and October 1999.
Mr. Pugh asked the Council to either deny or grant Mr. Marroquin's petition for a rate case.
He said if the Council denies it, they should waive the original jurisdiction of the city so that Mr.
Marroquin can proceed with his request to the PUC.
In response to Council Member Garcia, Mr. Pugh said he is addressing two different rate
cases: one involving peak season and interruptible rates, which should be expedited; and the other
involving the merger, which should be delayed. He said in the case of the peak season rates, he
would expect to have a $25 reduction each month for four months in the typical residential
ratepayer's bill. With respect to interruptible rates, Mr. Pugh said that would be difficult to predict,
but he believes those rates should be increased more than planned. He also further explained the rate
reduction that was ordered through the case in Docket No. 12820.
Replying to Council Member Betty Jean Longoria, Mr. Pugh said he is not asking the
Council to block the merger between CSW and AEP, but he felt the cities' attorneys needed more
time to negotiate a better deal.
Mr. Hector Marroquin, 2433 Allencrest, read a statement on behalf of his father, Jose
Marroquin, who said he was against the merger. Mr. Marroquin said in his statement that the $19
million discount being proposed in the merger will only result in a $30 savings per year for each
ratepayer, which he said was not sufficient. He said that by approving the merger, the ratepayers will
lose hope for future competition for electricity. Mr. Marroquin said if the Council proceeds with his
request for a rate case, the peak season rates may be lowered.
Mayor Neal called for comments from the audience, which he said would be limited to three
minutes each.
Mr. Jim Darling, City Attorney for the City of McAllen, said he is chairman of the Cities'
Steering Committee, which represents 48 cities. He said the PUC has made it clear that the merger
is not a rate case. He noted that only three of the cities have intervened in the merger --Corpus
Christi, Victoria, and McAllen --and they are the only cities which need to sign the stipulation for
it to become effective. He said one reason why those cities need to act on the merger at this time is
because there is a bill in the upcoming legislative session which will deal with electrical
restructuring (deregulation)
Mr. Darling said that by signing the stipulation, the intervening cities can seek an exception
to the proposed legislation so as to protect the savings that the stipulation will provide. Mayor Neal
asked if the City of McAllen has approved the stipulation, and Mr. Darling said it has.
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Regular Council Meeting
December 15, 1998
Page 8
Council Member Garcia asked Mr. Darling if he thought the attorneys could have negotiated
a better deal. Mr. Darling replied that he did not think they could have, reiterating that the stipulation
contains two major concessions by the company: abandonment of CPL'S appeal on the glide -path
issue, and retroactive rates to August 1999 by stipulation if the cities file a rate case in the event the
merger is not successful. Responding to another question from Mr. Garcia, Mr. Darling said the
merger does not affect another electric company's ability to seek a franchise agreement with the city
and/or their ability to obtain a certificate from the PUC.
Mr. John Hartley, 3925 Sandy Hollow, asked the Council to delay action on the merger. He
also asked the Council members to consider what affect this will have on young people's ability to
make a living in this community and to provide a home for their families.
Mr. Lonnie Garcia, 4505 Larkspur, said the Council has an obligation to serve the citizens
and he asked them to consider Mr. Marroquin's high electric rates.
Mr. Abel Alonzo, 1701 Thames, said he was concerned that a newspaper article had stated
that seven of the Council members had already made up their minds about this issue, and he
questioned the purpose of holding a public hearing if that is the case. He said citizens are asking that
the merger be delayed 30 days to allow the attorneys to negotiate a better deal.
Mr. Jim Hietpas, 3723 Rojo, said this year his electric bill doubled from previous years and
he added that he cannot afford to pay such high rates.
Mr. Byron Wooldridge, 6705 Deerwood, said the reason that Corpus Christi residents use
less electricity than other Texans is because many people cannot afford it. He asked that a decision
on the merger be delayed, and he added that CPL owes rate payers money arising from Docket No.
14965.
Mr. J.E. O'Brien, 4130 Pompano, asked whether any Council member who may have
received a campaign donation from CPL should recuse himself, or whether the Mayor, a former CPL
director, should recuse himself. Mr. O'Brien also asked when the decision was made to hold a public
hearing on this issue and by whom. He said he heard no Council discussion but just an
announcement after a closed meeting that a public hearing would be held. He also referred to an
article in the San Antonio Express -News, as well as to a portion of the stipulation agreement which
states that if the Legislature makes a mandate it will not change the agreement. He said he felt that
paragraph was meaningless since the Legislature has the priority in setting the laws. Mr. O'Brien
also referred to the attachments to the stipulation.
Council Member Martin made a motion to close the public hearing, seconded by Council
Member McNichols, and passed.
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Regular Council Meeting
December 15, 1998
Page 9
Council Member Colmenero said he examined the options before the Council pertaining to
the stipulation, to upcoming legislation, and to a possible rate case before the PUC. He said if the
Council decided to delay action on the merger, it is possible that the merger will not become
effective, which would jeopardize $235 million for the next 10 years for ratepayers. He expressed
support for approval of the stipulation.
Responding to Dr. Gonzales, Mr. Gay said if the Council delayed action on the merger, it is
possible that AEP may interpret that as a rejection of the merger. As for Mr. Pugh's calls for him to
go back and more aggressively negotiate a deal, Mr. Gay replied that he has negotiated a proposal
that is in excess of what the city's consultant would be suggesting if he filed testimony on the facts
of the merger. He said the Federal Energy Regulatory Commission plans to examine the issue of
competition and whether it is fair for CSW and AEP to merge; however, he said, there is no
suggestion that the merger savings are inadequate or wrongly calculated.
Mayor Neal asked about the city staffs recommendation. City Manager Garcia said staff has
examined Mr. Gay's recommendation to approve the stipulation and compared it to Mr. Pugh's
request that the city initiate a rate case. He said staff is convinced that the best opportunity to provide
rate relief to CPL customers quickly and in as large an amount as possible comes from accepting the
stipulated settlement.
Mr. Martin said this is a unique situation whereby the members of the Cities Steering
Committee have unified and negotiated a tremendous opportunity for the city. He then made a
motion to approve the proposed resolution, seconded by Mrs. Longoria.
Council Member Garcia asked if the stipulation affects Corpus Christi's franchise fees. Mr.
Gay replied that if there is a rate reduction, the franchise fees will be affected, but it does not affect
the city's ability to negotiate a new franchise. City Manager Garcia said staff has anticipated that
there will be an affect since the rates will be rolled back.
City Secretary Chapa polled the Council for their votes as follows:
2. RESOLUTION NO. 023509
Resolution ratifying an agreement with Central and Southwest Corporation (CSW) regarding
Public Utility Commission of Texas Docket No. 19265, Merger of Central and Southwest
Corporation and American Electric Power Company, because the agreement will provide
Central Power and Light ratepayers with greater rate relief than initiation of a rate case;
denying the request of Jose R. Marroquin dated September 7, 1998 to initiate a rate case
because such action would not serve ratepayers' interest in assuring the lowest legal electric
rates, and authorizing Mr. Marroquin to proceed with his request to the Public Utility
Commission of Texas.
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Regular Council Meeting
December 15, 1998
Page 10
The foregoing resolution passed by the following vote: Colmenero, Cooper, Garcia,
Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye."
* * * * * * * * * * * * *
Mayor Neal called for a brief recess.
* * * * * * * * * * * * *
Mayor Neal called for consideration of consent motions, resolutions, ordinances and
ordinances from previous meetings on Items 3-18. Council members and an audience member
requested that Items 4, 6, 12, 14, 15, 17 and 18 be withheld for discussion. City Secretary Chapa
polled the Council for their votes and the following were passed:
3. M98-415
Motion approving supply agreements with the following companies for the following
amounts in accordance with Coastal Bend Council of Governments Bid Invitation No.
CBCOG-99-1 for food items which include canned and frozen fruit and vegetables, meats
and condiments for an estimated six month expenditure of $78,790.35 based on the
recommended award submitted by the Coastal Bend Council of Governments. The term of
the contracts shall be for six months with an option to extend for up to three additional
months, subject to the approval of the Coastal Bend Council of Governments, the suppliers,
and the City Manager or his designee. Funds have been budgeted by Senior Community
Services in FY 98-99.
Sysco Food Service U.S. Foods
San Antonio, TX Corpus Christi, TX
77 Items 72 Items
$14,560.89 $34,155.57
Labatt Food Service
Corpus Christi, TX
104 Items
$29,412.39
Grand Total - $78,790.35
Lance, Inc.
Charlotte, NC
1 Item
$661.50
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
5. M98-417
Motion approving the purchase of fifteen computer workstations from MicroTek Sales, Inc.,
Corpus Christi for the total amount of $23,281, based on State of Texas cooperative
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Regular Council Meeting
December 15, 1998
Page 11
purchasing agreement. The computers will be used by the Legal Department and are
budgeted in the FY 1998-99 Budget as replacements.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
7. M98-419
Motion authorizing the City Manager or his designee to execute a construction contract with
Jalco Inc. in the amount of $625,795 for the Carolyn Heights and Sunnybrook/Mansheim
wastewater collection system rehabilitation project.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
8. M98-420
Motion authorizing the City Manager or his designee to execute a construction contract with
D&R Sales in the amount of $98,514 to construct a new gas regulator building.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
9. M98-421
Motion adopting the timetable for the FY 99 Consolidated Annual Action Plan (AAP) that
is the application process for the Community Development Block Grant (CDBG), HOME
Investment Partnerships (HOME), and Emergency Shelter Grants (ESG) programs.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
10.a. M98-422:
Motion authorizing the City Manager or his designee to accept a grant in the amount of
$185,914 from the State of Texas, Office of the Governor, Criminal Justice Division for
funding eligible under the FY 1998 Juvenile Accountability Incentive Block Grants Program
and to execute all related documents.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
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Regular Council Meeting
December 15, 1998
Page 12
10.b. ORDINANCE NO. 023510
Ordinance appropriating $185,914 from the State of Texas, Office of the Governor, Criminal
Justice Division, in the No. 162 Federal/State Grants Fund for the Juvenile Accountability
Incentive Block Grants Program; authorizing the transfer of $20,657 from the No. 111 Law
Enforcement Trust Fund, and appropriating it in the No. 162 Federal/State Grants Fund as
the city match for the Juvenile Accountability Incentive Block Grants Program.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and Neal voting
"Aye"; Cooper absent.
11.a. M98-423
Motion authorizing the City Manager or his designee to accept a grant extension and renewal
grant and execute a contract with the Texas Department of Human Services for the Title XX
Meals on Wheels Program.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
11.b. ORDINANCE NO. 023511
Ordinance appropriating a $10,886 extension grant and a $131,673 grant from the Texas
Department of Human Services to the No. 162 Federal/State Grants Fund for the Title XX
Meals on Wheels Program.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and Neal voting
"Aye"; Cooper absent.
13. ORDINANCE NO. 023513
Ordinance closing and abandoning a 1,131.56 -square foot portion of a 10 -foot wide by
113.16 -foot long utility easement out of Lot 5, Block 2, South Aires Subdivision No. 1,
subject to compliance with the specified conditions and the owner, George Preis, replatting
the property within 180 days at the owner's expense.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and Neal voting
"Aye"; Cooper absent.
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Regular Council Meeting
December 15, 1998
Page 13
16. ORDINANCE NO. 023516
Ordinance authorizing the City Manager to execute an extension of the lease agreements
with Pagan -Lewis Motors dba Budget Rent-A-Car of Corpus Christi Inc.; Coastal Bend
Rent-A-Car, Inc. dba Avis Rent-A-Car; Mar Jean Texas Inc. dba Hertz Car Rental; National
Car Rental of Corpus Christi Inc.; and JFC Leasing, LLC dba Dollar Rent-A-Car to extend
the lease agreements for no more than 12 months, on a month-to-month basis, all leases to
expire no later than December 31, 1999.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and Neal voting
"Aye"; Cooper absent.
Mayor Neal opened discussion on Item 4, purchase of traffic signal video cameras.
In response to Council Member Colmenero, City Manager Garcia said when staff proposed
budget reductions at last week's Council meeting, they examined comprehensive programs and
determined that reductions would not affect the city's ability to maintain service levels. The
reductions were achieved by eliminating service enhancements for this year. He said Item 4 is part
of the city's ongoing program of maintaining intersection signalization. Mr. Garcia said there were
120 traffic signal video cameras in the budget and 30 were eliminated as part of the reductions.
Mr. Colmenero also asked which intersections will be involved. Mr. Crull said staff has a
preliminary list of about 15 intersections throughout the city where the cameras will be located.
Replying to Council Member Gonzales, Mr. Crull said that as the in ground loop protectors
wear out they are replaced with video detection systems. City Manager Garcia pointed out that this
is an upgrading of the technology used at existing intersections.
City Secretary Chapa polled the Council for their votes as follows:
4. M98-416
Motion approving the purchase of 90 traffic signal video cameras from Ken Bridges A-V,
Corpus Christi, Texas in accordance with Bid Invitation No. BI -0030-99, based on low bid,
for a total of $107,100. Funds have been budgeted by the Street Department in FY98-99.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
Minutes
Regular Council Meeting
December 15, 1998
Page 14
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 6, airport land acquisition project.
Responding to Council Member Garcia, Mr. Crull said the parcels are being acquired under
the FAA's guidelines for acquisition of airport property since the agency will ultimately be paying
90% of the cost of the land. Referring to a map of the airport land acquisition, City Manager Garcia
said the city would like to acquire as much of the needed land as possible through agreed purchase
rather than having to initiate a condemnation proceeding. City Secretary Chapa polled the Council
for their votes as follows:
6. M98-418
Motion authorizing the acquisition of Parcel No. 8-D 1 located on FM -763 (Joe Mireur Road)
for $103,681 in connection with the Corpus Christi International Airport land acquisition
proj ect.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 12, needs assessment of old Nueces County
Courthouse.
Mr. Leon Perez, 904 Buford, said the old courthouse is not worth spending $50,000 on it.
adding that the mortar has turned to sand.
Mayor Neal asked when the report will be ready. Mr. Art Sosa, Building Official, said Mr.
Almond indicated that he plans to begin the study during the last week of December with completion
in four months.
Responding to Council Members Colmenero and McNichols, City Manager Garcia said the
Ad Hoc Committee will review Mr Almond's report and determine what they feel is and is not
feasible. He said the reason the study is being conducted is to ascertain the actual condition of the
building.
Council Member Martin pointed out that the contract includes an initiative for a detailed
estimate of the cost to demolish and remove the facility. City Secretary Chapa polled the Council
for their votes as follows:
Minutes
Regular Council Meeting
December 15, 1998
Page 15
12.a. ORDINANCE NO. 023512
Ordinance appropriating $49,480 from the Corpus Christi Industrial Development
Corporation in the No. 102 General Fund for Old Courthouse consulting services; amending
the FY 98-99 budget, adopted by Ordinance No. 023387, to increase appropriations by
$49,480 in the No. 102 General Fund.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and Neal voting
"Aye"; Cooper absent.
12.b. M98-424
Motion authorizing the City Manager or his designee to execute a contract for the historic
Nueces County Courthouse needs assessment and restoration study with Killis Almond and
Associates Inc. for a fixed fee not to exceed $50,000.
The foregoing motion passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye"; Cooper absent.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 14, closure of a utility easement.
Council Member Gonzales questioned why the city is requiring payment for the easement
closure by the property owner. City Attorney Bray summarized a memo in the agenda material
responding to Dr. Gonzales' question. He said in his opinion, the law and the Constitutional
requirements state that if the city owns a piece of property, the public owns the property (however
it is acquired). Consequently, he said, the public cannot give the property away for private benefit,
which he explained.
Council Member John Longoria asked how this item differs from the easement closure under
Item 13. Mr. Crull replied that in that case, the city approached the property owner to acquire the
easement in order to install a sewer system in that area. The property owner then dedicated the
easement at no cost. Subsequently, staff decided on another location for the sewer system and the
easement is no longer needed. He said staff is recommending that the utility easement be closed, that
the fair market value be waived, and that the property be returned to the owner.
Mr. Crull said that with regard to Item 14, the property consists of two separate lots with the
utility easement between them. The property owner wishes to combine the two lots into one in order
to construct a church building, which necessitates the closure of the easement.
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Regular Council Meeting
December 15, 1998
Page 16
Dr. Gonzales asked if the city could require the church to pay $1 for the easement. Mr. Bray
replied that that would constitute a waiver of the requirement. He said the difficulty is that the
private property owner initiated the request for the easement closure for a private benefit.
Council Member Martin pointed out that the property is owned by the church and pays taxes
on it. Responding to a question from Mr. Martin, Mr. Crull said the easement in question is a full
utility easement. Mr. Martin asked if the city has the right to waive platting fees, and Mr. Bray said
the city can when it is for city benefit.
Council Member McNichols asked if the city can make a finding that the public interest is
served by the fact that the property owner is a church; Mr. Bray said it cannot. Responding to
Council Member Garcia, Mr. Crull explained how the fair market value was established for the
easement closure. Mr. Bray added that the Council makes the final decision on that issue. A brief
discussion ensued.
Mr. Martin suggested that the church be allowed to pay the $1,418 for the easement closure
over a period of three years. There was consensus of the Council to allow staff to work out a
payment schedule for the church over three years.
City Secretary Chapa polled the Council for their votes as follows:
14. ORDINANCE NO. 023514
Ordinance closing and abandoning a 3,546 -square foot portion of a 10 -foot wide utility
easement out of Lots 1 and 1A, Block 6, Southbridge Unit 4, recorded in Volume 55, Page
162, of the Map Records of Nueces County, Texas; subject to compliance with the specified
conditions and the owner, The New West Haven Baptist Church, replatting the property
within 180 days at its expense.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Cooper, Garcia, Gonzales, B. Longoria, Martin, McNichols, and Neal voting
"Aye"; J. Longoria voting "No."
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 15, appropriation of Police Department grant funds.
Council Member McNichols asked how these grant funds affect the status of the mobile data
terminals/automated vehicle location (MDT/AVL) system. Police Chief Alvarez said the
department's current computer system needs to be upgraded so as to accommodate the MDT/AVL
system when it is implemented in approximately January 2000.
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Regular Council Meeting
December 15, 1998
Page 17
Council Member Martin asked if there was funding for the system. Chief Alvarez replied that
some adjustments have been made in the purchase of some of the equipment, but the grant funds can
be used. Mr. Martin and City Manager Garcia said the MDT/AVL system will enhance the
productivity of the existing public safety personnel through decreased response time and decreased
time needed to process paperwork. City Secretary Chapa polled the Council for their votes:
15. ORDINANCE NO 023515
Ordinance appropriating $716,217 from the U.S. Department of Justice, Bureau of Justice
Assistance in the No. 162 Federal/State Grants Fund to purchase computer and radio
equipment to complement the mobile data terminals/automated vehicle location system being
installed, digitized radios to replace analog radios, technology to equip the mobile
communications van, and 10 non -police package vehicles; authorizing the transfer of
$79,580 from the No. 111 Law Enforcement Trust Fund and appropriating it in the No. 162
Federal/State Grants Fund as the City's grant match.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Cooper, Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and
Neal voting "Aye."
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 17, agreement with C3 Communications Inc.
Responding to Council Member Colmenero, Mr. Bray said the company in question is
assuming the ownership of certain underground fiber optic cable lines which were previously used
by another company. City Secretary Chapa polled the Council for their votes as follows:
17. ORDINANCE NO. 023517
Ordinance authorizing the City Manager or his designee to execute a use privilege agreement
with C3 Communications Inc., for the right to install and maintain both an aerial and
underground fiber optic cable in designated portions of public rights-of-way; establishing a
one time fee of $52,410.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Cooper, Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and
Neal voting "Aye."
* * * * * * * * * * * * *
Minutes
Regular Council Meeting
December 15, 1998
Page 18
Mayor Neal opened discussion on Item 18, transfer of control of the cable t.v. franchise.
Council Member McNichols said he had had a question about whether he could vote on this
item due to his involvement with AT&T, and he has since clarified that with the attorney. City
Secretary Chapa polled the Council for their votes as follows:
18. IRS READING ORDINANCE
Approving the merger transactions between AT&T Corporation and Tele-Communications,
Inc. and consenting to the change of control of the cable television franchise.
The foregoing ordinance passed on first reading by the following vote: Colmenero, Cooper,
Garcia, Gonzales, B. Longoria, J. Longoria, Martin, McNichols, and Neal voting "Aye."
* * * * * * * * * * * * *
Mayor Neal referred to Item L., a progress report on the city's Year 2000 readiness plan.
Mr. John Bacon, Director of Information Systems, began his computer presentation by
referring to the Year 2000 Readiness Disclosure, which states: "This is a Year 2000 Readiness
Disclosure. Statements contained within this disclosure are subject to the Year 2000 Information and
Readiness Act. In case of a dispute, this document and the information contained within it are
entitled to the protections of the Act and may reduce your legal rights regarding the use of this
document." He said this statement is posted on the city's Web site and will be included in all
information releases in the future.
Mr. Bacon said in anticipation of the Y2K issue, over 75 action items have been identified
and assigned to 20 different department heads for resolution. In all, there are several hundred city
employees working directly on this project, which consists of four components: mainframe
replacement; other information systems; embedded systems; and business partners.
Mr. Bacon explained that in terms of personnel, time and dollars, the city's primary focus
to date has been on replacement of the non-compliant mainframe and its software. He reviewed
actions that have been taken thus far. An assessment of the mainframe was completed in 1996 which
indicated that it would cost between $3 million to $5 million to modify the existing hardware and
software to make them Y2K compliant. Consequently, the decision was made in 1997 to replace the
systems rather than bring them into compliance. Also last year four project teams were developed:
Finance, Human Resources (including Payroll), Municipal Court, and Fleet Management.
He went on to say that in early 1998 staff evaluated proposals from several vendors in
response to RFP's, and in March certificates of obligation were sold to finance the project. Also that
Minutes
Regular Council Meeting
December 15, 1998
Page 19
month, the City Council awarded three contracts to three separate firms to replace the systems. Mr.
Bacon referred to the schedule for the coming months, explaining that implementation of all system
modules will be completed by August 1999 and technical staff will have received the necessary
training. In addition, new and replacement personal computers will continue to be installed and by
September 1999 the wide -area network expansion will be completed.
Mr. Bacon said that as a whole, the project is on track, although there have been some delays
and some improvements in individual segments of the project. He cited the following completion
dates: Fleet Management and Municipal Court- January 1999; Payroll and other Human Resources
modules - March 1999; Financials - June 1999; and Cash Receipts and Accounts Receivable -August
1999. Mr. Bacon also indicated that the project is still within the overall budget (of $9,725,000)
although there have been variances in several line items, most notably a further expansion of the
wide -area network made possible by savings in the personal computer replacement and upgrade
component.
Mr. Bacon said that while the current mainframe software is supported in-house, other major
information systems rely on vendor support for the day-by-day maintenance of the application
software. These include Library, Geographical Information System, Public Safety computer-aided
dispatch and record management system, and utility billing. Mr. Bacon also discussed embedded
systems, such as the 800 MHZ radio system, telephones, utility supervisory control and data
acquisition (SCADA) and telemetry, fire control, lighting, security, and others.
With regard to the city's business partners, Mr. Bacon said they have been categorized as
follows: suppliers of goods and services; financial institutions; and organizations which provide
services to city employees. He noted that beginning in January 1999, a "readiness survey" developed
by city staff will be included in all bid invitations and requests for proposals. He said that based on
the nature of the item to be procured, the city may rule that a vendor is non-compliant and disqualify
them if they appear unprepared for the year 2000 or do not return the survey.
Mr. Bacon concluded by saying that he will give the Council another update on this issue in
March 1999; in addition, staff plans to hold presentations by other entities, including CPL,
Southwestern Bell, Frost Bank, Nueces County, and the Federal Aviation Administration.
Mayor Neal said he wished to have a thorough review of the city's readiness for the year
2000 at least by Thanksgiving 1999.
Council Member Colmenero noted that the completion date for wastewater SCADA and
telemetry is December 1999, and he asked if that date can be moved forward. Mr. Bacon replied that
staff will try to fast-track that component; he added that the necessary information can be obtained
manually if necessary, as it was years ago before the systems were automated.
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Regular Council Meeting
December 15, 1998
Page 20
Council Member Garcia requested a copy of the city's 75 -item Y2K compliance checklist,
and Mr. Bacon said he will provide it. Mr. Garcia also suggested that the Council Administrative
Analysis Committee begin meeting every 30 to 45 days to review compliance issues. Mr. Garcia
asked about the city's contingency planning, and City Manager Garcia replied that most of the city's
efforts are going into testing the systems and ensuring that the necessary changes are made both
within the city and by the city's suppliers. He added that other entities which are dependent upon the
city's services are also surveying the city to ensure its readiness for the year 2000.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 19, "automobile -free zone" on Alameda Street
bridge. He called for comments from the audience, and there were none. City Secretary Chapa polled
the Council for their votes as follows:
19. RESOLUTION NO. 023518
Resolution supporting the request by the Corpus Christi Regional Transportation Authority
and proposal to the Texas Department of Transportation for the designation of the Alameda
Street Bridge over Interstate Highway 37 between its north and south frontage roads, as an
"automobile -free zone" for purposes related to the Regional Transportation Authority's
Livable Communities Initiative Project, Phases 2 and 3.
The foregoing resolution passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, McNichols, and Neal voting "Aye"; Cooper and Martin absent.
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 20, Latchkey Program agreement. He called for
comments from the audience, and there were none. City Secretary Chapa polled the Council for their
votes as follows:
20. RESOLUTION NO. 023519
Resolution authorizing the City Manager or his designee to execute an Interlocal Agreement
with Corpus Christi Independent School District (CCISD) to execute a nine-month
agreement to operate a Latchkey Program on designated CCISD campuses.
The foregoing resolution passed by the following vote: Colmenero, Garcia, Gonzales, B.
Longoria, J. Longoria, McNichols, and Neal voting "Aye"; Cooper and Martin absent.
* * * * * * * * * * * * *
Minutes
Regular Council Meeting
December 15, 1998
Page 21
Mayor Neal opened discussion on Item 21, Disability Income Protection Plan. There were
no comments from the audience. City Secretary Chapa polled the Council for their votes as follows:
21. ORDINANCE NO. 023520
Ordinance amending Ordinance No. 8127 by amending Section 951.0, Plan I Employees,
Subsection 951.14, Disability Income Protection Plan, to provide authority for the City
Manager to set shared premium contributions on a percentage basis.
An emergency was declared and the foregoing ordinance passed by the following vote:
Colmenero, Garcia, Gonzales, J. Longoria, McNichols, and Neal voting "Aye"; Cooper, B.
Longoria, and Martin absent.
* * * * * * * * * * * * *
Mayor Neal announced that Item 22 had been withdrawn by the City Manager.
22. WITHDRAWN
a -
510, Maeat,eljai Group Pay Plat fel FY 1998 99, effe.,ti•e D,,,, m1_,,t 7, 1998, with a.,.a:s,,,1
Subs,etiens: Seetiei. 500, Subset on 509; Scctie , 550, Sulscctiei.s 551.1, 551.5, 551.7,
* * * * * * * * * * * * *
Mayor Neal opened discussion on Item 23, joint funding agreement with the USGS. He
called for comments from the audience, and there were none.
Minutes
Regular Council Meeting
December 15, 1998
Page 22
Responding to Council Member McNichols, Mr. Crull said some of the data that will be
gathered by the USGS will be used to further refine the firm yield of the water supply system. Dr.
McNichols asked if some of the cost for this item could be shared by other water users in the system.
Mr. Crull replied that all of the costs under the water supply activity are rolled into the raw water
cost adjustment, which is shared among the users. Mr. Chapa polled the Council for their votes:
23. M98-425
Motion authorizing the City Manager or his designee to execute an annual Joint Funding
Agreement with the United States Geological Survey (USGS), U.S. Department of the
Interior, for the continuation of surface water data collection and limited studies by the
USGS for the City's water supply activity; providing that the City pay the USGS the amount
of $134,960, out of a total project cost of $171,270.
The foregoing motion passed by the following vote: Garcia, Gonzales, B. Longoria, J.
Longoria, McNichols, and Neal voting "Aye"; Colmenero, Cooper and Martin absent.
* * * * * * * * * * * * *
Mayor Neal called for the City Manager's report. Mr. Garcia said that on December 8th the
first meeting was held about the new area code by a group consisting of business leaders, community
leaders, citizens, and various telecommunications providers. He said public service announcements
and an extensive advertising campaign will ensue to inform the public of the change to area code
361. Mr. Garcia noted that December 15' is the last meeting scheduled for 1998, and the next regular
meeting is scheduled for January 12, 1999.
Mayor Neal noted that the legislative forum will be held at Texas A&M University -Corpus
Christi on December 16th and he plans to present the city's legislative agenda to the legislative
delegation. The Mayor also requested a meeting with the City Manager and appropriate staff on the
issue of a traffic light at SPID and Aquarius Drive. He then called for Council concerns and reports.
Council Member Garcia reported pot holes in front of Grace United Methodist Church on
Leopard Street. He and other Council members also extended holiday greetings. Council Member
Gonzales requested a report on the infrastructure and facility needs in Flour Bluff.
Council Member Betty Jean Longoria requested an update on the Laredo/Agnes/Crosstown
Triangle landscape project. Council Member Colmenero reported sidewalk and gutter problems at
416 Chaparral and 300 Chaparral.
There being no further business to come before the Council, Mayor Neal declared the
Council meeting adjourned at 6:30 p.m. on December 15, 1998.