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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 Minutes 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 Minutes 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. Minutes 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. Minutes 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 Minutes 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. Minutes 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. Minutes 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. Minutes 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 Minutes 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. Minutes 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. Minutes 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. Minutes 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. Minutes 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. Minutes 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.