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HomeMy WebLinkAboutMinutes City Council - 04/02/2002 - SpecialI HEREBY CERTIFY that the foregoing is a true and correct copy of the minutes of the Special Council Meeting of the City of Corpus Christi of April 2, 2002, which were approved by the City Council on April 16, 2002. WITNESSETH MY HAND AND SEAL, this 16th day of April 2002. SEAL Armando Chapa City Secretary • 1 i 7 MINUTES CITY OF CORPUS CHRISTI, TEXAS Special Council Meeting April 2, 2002 - 9:05 a.m. PRESENT Mayor Samuel L. Neal Jr. Council Members: Javier D. Colmenero Henry Garrett Bill Kelly Rex A. Kinnison John Longoria* Jesse Noyola Mark Scott ABSENT Mayor Pro Tem Brent Chesney City Staff: City Manager David R. Garcia Deputy City Manager George Noe City Attorney James R. Bray Jr. City Secretary Armando Chapa Recording Secretary Rachelle Parry Mayor Neal called the meeting to order in the Council Chambers of City Hall. 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. City Manager Garcia said the purpose of this meeting is to provide detailed information to the Council about the capital improvement program (CIP) and the capital budget. *Council Member Longoria arrived at 9:08 a.m. Mayor Neal said that since this meeting was posted as a special meeting rather than as a workshop, he will call for public comment after each presentation. The first presentation was regarding the short-range and long-range CIP for the Water Department (including the water supply element). Mr. Mark McDaniel, Director of Management and Budget, gave an overview of the CIP, which staff had presented to the Council during their annual retreat on March 15, 2002. He said staff has identified a funding plan for the three-year, short-range CIP in the existing rate model (assuming 6% utility rate increases); however, the long-range CIP does not have an identified funding plan. Mr. Garcia said that in addition to the extensive listing of projects in the three-ring binder, staff has also provided the Council with a prioritized enumeration of the long-range CIP for both the combined utility system and future street needs. Mr. Ed Garana, Water Superintendent, discussed the Water Department projects. He noted that in the short-range CIP, the southside transmission main (Phases 2-5) is the largest project, comprising 46% of the total ($28.85 million). Mr. Garcia explained that about two years ago, the southside of the city experienced a crisis of sorts with its water pressure. Consequently, the South Staples Street pump station was moved ahead of schedule as a stop -gap measure pending the progression of the southside transmission main project. Mr. Garcia said the plan originally called for running a 36 -inch main across the Laguna Madre to Padre Island, which would have been very expensive. However, the Council directed staff I r T Minutes - Special Council Meeting April 2, 2002 - Page 2 to explore the development of a desalination facility on the island so as to create a separate water supply there. Mr. Garafia said that will eliminate the need for the water main crossing but a line still needs to be extended to Flour Bluff. He added that that project will provide a more stable water platform across the entire city, which was further discussed by Assistant City Manager Ron Massey. Council Member Kinnison asked about changing the timing of some of the projects in order to alter the rate model (i.e., reduce the need for 6% rate increases). Mayor Neal said that if the Council is committed to the three-year funding plan provided by the rate model, projects can be substituted but the overall cost would remain the same. However, he said it is a different issue if the Council is not committed to the funding plan. Mr. McDaniel said that in order to lower the rate model by 1%, about $8.4 million of projects will have to be eliminated in Year 1. And taking into consideration the compounding effect, that equates to $21 million of projects in Year 10. There was additional discussion of the short-range CIP water projects. With regard to the water supply short- range CIP, Mr. McDaniel said the largest project is the Garwood pipeline at 49% ($10 million) followed by the Rincon Bayou pipeline at 32% ($6.5 million). Mr. McDaniel then discussed the water long-range CIP projects. He said traditional funding sources include the "pay-as-you-go" CIP, commercial paper (on an interim basis), and revenue bonds. Mr. Garafia said the largest of the long-range projects are the water treatment plants at 47% ($41 million) followed by Phases 6 and 7 of the southside transmission main at 28% ($24 million). He also discussed the projects in the categories of distribution, pumping plants and other water needs. Responding to Council members' questions, Mr. Garcia said that the Texas Natural Resource Conservation Commission (TNRCC) requires that when a community reaches 75% of its water and wastewater capacity, it needs to have a firm plan in place to increase that capacity. While reviewing the individual projects, Council members commented specifically about water service to customers outside the city limits and the issue of the colonias. Regarding the water supply long-range CIP, Mr. McDaniel said that traditional funding sources include revenue bonds supported by the raw water charge component of the utility rates. He noted that funding for the initial study phases of the Garwood pipeline and the Padre Island desalination facility is included in the short-range CIP. Staff is in the process of evaluating engineering proposals for feasibility studies for the projects. Upon completion of those studies, the cost estimates and schedules will be refined for inclusion in the long-range CIP. The Garwood pipeline constitutes 90% ($88 million) of that plan and the desalination facility is 10% ($10 million). Additional discussion ensued about the raw water charge and the utility rate model. Mayor Neal called for public comment about the water projects. Mr. Bill Kopecky, 3609 Topeka, referred to the water long-range CIP. He said that in 1997 and 1998, 300,000 acre-feet of water was spilled due to rains the city could not capture because Lake Corpus Christi was full and most of the rains were coming through the Nueces Basin. He asked the Council to seriously consider constructing a pump station in the Simmons area or a water diversion at Cotulla as a long-range water supply alternative to either delay or eliminate the need for the Garwood pipeline. ■ r r r Minutes - Special Council Meeting April 2, 2002 - Page 3 Mr. Massey said city staff has asked the Regional Water Planning Group to look at the issue of optimization of the Nueces Basin. In addition to Mr. Kopecky's suggestions, another idea is to build a two-way pipeline between Lake Corpus Christi and Choke Canyon Reservoir. Responding to Council Member Scott, Mr. Garafia said the evaporation rate in those two reservoirs is large, as are transportation losses. He said at their closest point (at Simmons), the Nueces River is about 10 miles from Choke Canyon. Mr. Garcia said the Garwood pipeline and the desalination facility alone are not going to solve Corpus Christi's long-range water supply needs. He said the Council should have a wide range of available options. Responding to Mayor Neal, City Attorney Bray said the Simmons plan was one of 22 options in the Trans -Texas study in the early 1990s. Mr. Garcia said staff could add the Cotulla reservoir and the reservoir optimization study (including the estimated costs) to the city's long-range water supply plan. Mayor Neal said that in addition to the Garwood pipeline and the desalination facility, the Council should also have information about piping the water from the Choke Canyon Reservoir to a water treatment facility (as opposed to Lake Corpus Christi). Mr. Scott said there are people who are opposed to that concept and Mayor Neal said future Councils will need to evaluate all of the options. Mr. Garcia pointed out that the city now has a long-term water planner, Mr. Max Castefieda, and staff can give the Council a presentation about the city's water planning strategy. Council Member Kinnison suggested that the city consider partnering with other entities. Mr. Garcia said staff is trying very hard to maintain the integrity of the city's water supply as a result of attempts by other cities to utilize it as they face their own water crises. Mayor Neal said that having a sufficient water supply is this community's number one issue. ************* The second presentation was regarding the Wastewater Department. Mr. Foster Crowell, Wastewater Superintendent, explained that the city has six basins, service areas and treatment plants which operate independently of each other. He noted that many of the projects are necessary to meet the TNRCC's wastewater discharge permits, which regulate such things as effluent quality, plant capacity, and basin treatment capacity. Mr. Crowell then described the many projects included in the short-range CIP, with total programmed expenditures for the three years of $70.56 million. Mayor Neal asked about the status of the downtown wastewater system. Mr. Crowell replied that there have been several wastewater improvement projects in that area, including sliplining of the Water Street trunk and ongoing inflow and infiltration issues. He said that overall, the downtown area is doing well. Council Member Colmenero asked about the longevity of sliplined pipes. Mr. Crowell said that in 1982 Corpus Christi started sliplining pipes as part of a pilot project and they are still operating. He said the estimated life of a sliplined pipe is 50 to 70 years. Mr. Crowell and Mr. Escobar responded to other Council members' specific questions about certain projects and general comments about the large number of wastewater projects in relation to the amount of staff (including engineers) needed to design and construct them. Minutes - Special Council Meeting April 2, 2002 - Page 4 Mr. Crowell then discussed the wastewater long-range CIP projects, which are categorized as follows: wastewater treatment plants - $131.8 million; lift stations and force mains - $17 million; collection systems - $16.1 million; and other related wastewater needs - $16.73 million, for a grand total of $181.6 million. City staff also responded to Council questions; there was no public comment. * * * * * * * * * * * * * The third presentation was about the Gas Department. Ms. Debbie Marroquin, Gas Superintendent, explained that there are five separate gas systems: Corpus Christi (consuming 90% of the gas); Calallen/Annaville (7% consumption); Padre Island; Country Creek; and farm taps on Old Brownsville Road and Hwy. 44. She said that five of the seven short-range CIP projects pertain to the southside gas transmission main. The first project (Part A), which involves crossing Oso Creek at South Staples Street, is estimated to cost $1 million and will connect the Country Creek gas system to the Corpus Christi system. The last two projects are for reservation fees and a compressed natural gas station. Ms. Marroquin also discussed the long-range CIP projects, the first three of which involve additional phases of the southside gas transmission main totaling $6.5 million. The other two are for reservation fees for years two and three for $1.4 million, for a grand total of $7.9 million. She said their goals are to connect the gas systems as much as possible and to pursue a more competitive gas supply contract. She then responded to Council members' questions. There were no comments from the public. * * * * * * * * * * * * * The fourth presentation was made by Ms. Valerie Gray, Stormwater Superintendent. She discussed the three main categories of projects in the short-range CIP: minor drainage improvements - $1.13 million; bridge rehabilitation and replacement- $600,000; and rolled curb and gutter replacement - $330,000. Staff members responded to questions from the Council and there was a discussion about rolled curbs and gutters and drainage problems throughout the city. Mr. Massey noted that the stormwater master plan, which is being developed, will set drainage standards for neighborhoods. At that point, a determination can be made about how each neighborhood measures up to the established standards. He said that eventually the city will improve those areas but it will take much time and money to do so. Mayor Neal stated that any of the stormwater long-range CIP projects can be moved into the short-range plan but it would be at the expense of water projects under the city's current funding system. Additional discussion ensued about the difficulty of funding stormwater projects. Mayor Neal suggested that the Council reread a March 8, 2002 memo from the City Manager in which he forwarded the recommendations of the Stormwater Management Advisory Committee. The Mayor asked staff to provide a presentation to the Council about those recommendations. In response to Council members' questions, Ms. Gray discussed the waiting list for rolled curb and gutter improvements. Mr. Garcia stated that the city requires developers to build drainage Minutes - Special Council Meeting April 2, 2002 - Page 5 ditches as part of the platting process. Mr. Escobar explained the Channel 31 pilot project and noted that some communities, such as San Patricio, have created drainage districts which other communities can utilize. He said the last major stormwater expenses were incurred as part of the 1986 bond program. Mr. Garcia said that cities throughout the state impose impact fees. Mr. Escobar said that in the next few months, staff will begin bringing items to the Council related to the stormwater master plan. Mayor Neal said the development community in Corpus Christi has always resisted impact fees. Mr. McDaniel then referred to the 39 stormwater long-range CIP projects, which total $66.8 million. He noted that those projects will be reprioritized once the results of the master plan are obtained. Ms. Gray said the master plan may even add projects to the CIP. Responding to Council Member Kelly, Ms. Gray said that Nueces County and other entities will be included in the master plan discussions. She then delineated the long-range projects. Mayor Neal said that areas south of South Padre Island Drive drain into the Cayo del Oso and Oso Creek and he asked about permitting standards for those areas. Mr. Massey said the master plan should identify the areas that probably should not be developed because of environmental concerns. A discussion ensued about the quality of stormwater runoff. The Mayor commented that the city is now paying the price for very poor stormwater planning in the 1960s and the future development of the city is directly tied to stormwater issues. There were no comments from the audience. * * * * * * * * * * * * * The fifth presentation was regarding the utility rate model. Mr. McDaniel said the model currently indicates a continued need for a 6% base rate increase per year beyond the short-range CIP for all the utilities (not including the increase for the raw water charge). He said the model is intended to support a 25% working capital (25% of expenditures) for the combined utility system, which has been set as a policy issue and is considered by the bond rating agencies. He said at this point it assumes the inclusion of the entire short-range and long-range CIP as of January 2002. The Budget Director then showed a graph of utility rate adjustments since 1975. He said the average rate increases for water, wastewater and gas were approximately 4%, 8% and 3% respectively. Mr. McDaniel said that each 1% increase in the base utility rates in FY02-03 will generate the following (approximate figures): $761,766 in revenue; $8.4 million in capital improvement project capacity in Year 1 of the short-range CIP (FY02-03); $9.5 million in capacity in Year 1 of the long-range CIP (FY04-05); and $21 million in capital improvement capacity by Year 10 (FY11- 12). He pointed out that the model is a planning tool that has very many variables, such as inflation rates. He said every year it is reviewed and updated. Mr. Kinnison said the utility rate model includes every project in both the short-range and long-range programs. He said he would like staff to develop a rate model with 3% utility rate increases and then determine the amount of funding that will be available. He said at that point the Council can determine what projects will "fall out" and not be funded. Mr. Garcia said the simplest thing to do is to drop off the unfunded stormwater projects, Minutes - Special Council Meeting April 2, 2002 - Page 6 which total $66 million. However, he said the implication of not raising the utility rates 6% is that if the Council wishes to fund those projects in the future, a much more substantial rate increase will be needed. He said staff can provide all that information to the Council. Mayor Neal said staff should determine a dollar amount rather than pinpointing projects. He added that the short-range projects should continue to be funded. Mr. Garcia said many of the projects are linked together and, as certain areas are cut back, they commit to a course of action that has long-range implications. He said if the Council is considering cutting back to 3% rate increases in next year's budget (FY02-03), that will impact projects that are currently underway. Mr. Scott said staff needs to illustrate the long-term effect of lesser rate increases. Mr. Longoria said he thinks the trend has been for Councils and the general public to be more critical of 6% rate increases and he suggested that instead, staff should budget for lesser amounts. He added that staff should also show how different rate increases will affect a typical utility bill. Mr. Colmenero asked staff to also consider other funding options. Mr. Noyola said there are many people on fixed incomes who would be adversely affected by a 6% rate increase. Mr. Kinnison said the Council can lay the ground work and plan ahead for future projects and future bond elections. There were no comments from the audience on the utility rate model. Mayor Neal recessed the meeting at approximately 1:25 p.m. so the Council could attend the funeral of Council Member Chesney's father. * * * * * * * * * * * * * The Mayor reconvened the Council meeting at approximately 3:20 p.m. The sixth presentation was regarding public facilities. Mr. McDaniel pointed out that staff would be focusing on the long-range CIP projects for public facilities, public health and safety, airport, parks and recreation, and streets since the short-range CIP is made up almost entirely of utility projects (which have already been discussed). He said that traditional funding sources for public facilities programs include bond funds (general obligation, sales tax, and hotel/motel tax) and CDBG funds. Mr. Kevin Stowers, Assistant Director of Engineering Services, said there are five public facilities projects in the long-range CIP totaling $9.9 million: northwest branch library expansion; new southside branch library; Memorial Coliseum improvements; "Doc" McGregor photograph collection storage facility; and a marine archeology laboratory. He said the short-term CIP projects (including the multipurpose arena and the convention center expansion) are well underway. Mr. Kinnison asked about the Memorial Coliseum project. Mr. Stowers said that a decision has not yet been made about the functionality of the coliseum, particularly since the arena is not completed. Deputy City Manager Noe pointed out that the city has a lease with the IceRays hockey team for the use of the coliseum. The lease has a five-year renewal option and staff intends to negotiate for the IceRays to use the arena instead. Mr. Garrett asked about the Workforce Development roof waterproofing, and Mr. Stowers said that contract, which is being funded with CDBG monies, has already been awarded. Mr. Garrett commented that that building (the old Police Department headquarters) has had water leaks for many years. There were no public comments. Minutes - Special Council Meeting April 2, 2002 - Page 7 The seventh presentation was about the public health and safety projects. Mr. McDaniel said that traditional funding sources are general obligation and sales tax bonds, State Infrastructure Bank loans, and the Padre Island tax increment financing district. Mr. Stowers said the long-range CIP includes some continuing projects that were in the 2000 Bond issue, such as Phase 2 of the public safety training facility ($10 million). Other future projects are: a fire station in the area of Yorktown Boulevard between Rodd Field Road and the Cayo del Oso - $1.5 million; Annaville fire station - $1.5 million; Police headquarters expansion (Phases 1 and 2)- $1.8 million; and four police substations - $2.5 million, for a total of $17.3 million. Mr. Stowers also referred to the ongoing short-range public health and safety projects. He said staff is working on land acquisition for Phase 1 of the police and fire training facility; advertising for the Mustang Island fire substation project will be advertised on April 15th; fire station ADA compliance and coed improvements are underway; the Health Department roof repair has been completed; the contract for the construction of the new Animal Control facility has been awarded; the seawall, sidewalk and marina bulkhead improvements are currently being advertised for bids; the Elliott Landfill project is under construction; the Packery Channel project is moving forward; and the JFK Causeway elevation is also underway. Staff then responded to Council members' questions, including some regarding the police substations and fire stations. There were no comments from the public. * * * * * * * * * * * * * The eighth presentation was regarding the airport long-range projects. Mr. McDaniel said that traditional funding sources include Federal Aviation Administration (FAA) grants, passenger facility charges, airport revenue bonds and airport capital reserves. He said that future airport capital improvement projects are dependent on FAA grants and discretionary funding. Mr. Dave Hamrick, Aviation Director, said many of the CIP projects are demand -driven in accordance with the recently received airport master plan. He then described the long-range projects, which are categorized as follows: runway extension - $28.09 million; land acquisition - $11.71 million; airfield drainage - $4.1 million; airfield rescue - $2.85 million; taxiway improvements - $1.93 million, and other projects - $2.65 million, for a total of $51.33 million. Mayor Neal asked about a project in the current year known as the landside roadway system - entrance road reconstruction. Mr. Stowers replied that staff plans to open bids on April 22nd for the loop road portion and parking lot improvements. He said the entrance road component itself has been deferred to the future. Mr. Hamrick said he does not think it will be too far in the future, which he explained. The Mayor also asked about a possible joint facility usage. Mr. Hamrick said subsequent to the Mayor's request, he has drafted a lease for the Coast Guard, which is interested in relocating to the airport. Mayor Neal also commented on the importance of homeland security and Corpus Christi's proximity to the Gulf of Mexico. Additional discussion ensued about the entrance road and the joint use airport issues. There were no comments from the audience. * * * * * * * * * * * * * 1 r Minutes - Special Council Meeting April 2, 2002 - Page 8 The ninth presentation was regarding park and recreation projects. Mr. McDaniel said that traditional funding sources include general obligation bonds, park trust funds, CDBG funds, state or interagency grants, and street assessment appropriations. He said the long-range CIP will be further refined pending the completion of the parks master plan, which is estimated to occur in the summer of 2002. Mr. Stowers said these programs also receive monies from the Golf Course Fund, Marina Fund and General Fund. He said the long-range CIP includes improvements in the following areas: golf courses - $10 million; aquatic facilities - $8.78 million; parks - $7.98 million; marina - $5.5 million; neighborhood park playgrounds - $5 million; beaches - $2.4 million; park maintenance facilities - $1.09 million; recreation centers - $615,000; tennis centers - $495,000; and other - $605,000, for a total of $42.46 million. Mr. Kinnison requested that the new southside senior center be included in the short-range program and he inquired about the marina improvements, to which Mr. Tony Cisneros, Director of Park and Recreation, responded. Mayor Neal asked about the marina dredging project. Mr. Stowers said it is a Texas General Land Office project, which he further described. Mr. Massey added that despite the GLO project, there is a need for long-term marina dredging. Mr. Longoria asked Mr. Kelly about the CIP project for Labonte Park. Mr. Kelly said that park is where all the soccer and intramural sports are played in the northwest area. Mr. Stowers said any infrastructure at Labonte Park will be flood resistant; however, most of the improvements will be for underground utilities. Mr. Noyola asked about the timing of the Garcia athletic fields renovation and the West Oso High School tennis courts renovation. Mr. Cisneros said there are many park and recreation projects in the long-range CIP and not enough money to pay for them. He said part of the problem is deferred maintenance, which is also caused by a lack of funding. Mr. Garcia added that West Oso High School is located in a CDBG-eligible area. Mr. Scott referred to the short-range CIP, saying that one of the baseball leagues is concemed that the irrigation system project is being done during baseball season. Mr. Cisneros replied that it is simply a function of needing to get the projects done. A discussion ensued. Mr. Colmenero asked about projects at the senior centers and the HEB tennis center, and Mr. Garrett asked about South Bluff Park and the out -of -service fire station on Louisiana Parkway, to which staff responded. There was no public comment. * * * * * * * * * * * * * The tenth and last presentation was regarding street projects. Mr. McDaniel explained that after the capital budget/planning guide was distributed, staff updated the streets long-range CIP, including adding some new projects (with pending cost estimates). Mr. Stowers said the future street needs are not funded at this time but will be through the next bond issue. He said staff has made recommendations about the priority of those projects, which are categorized under new construction, reconstruction and other street -related construction. Mr. Massey explained that new construction expands capacity, whereas reconstruction takes an existing road and increases its longevity. • sr• r Minutes - Special Council Meeting April 2, 2002 - Page 9 Responding to Mayor Neal, Mr. McDaniel said the preliminary estimate for the streets long- range CIP is $125.39 million, but that does not include some of the new projects. Mr. Massey said the timing of some of those projects depends on how much money is invested in street maintenance each year. He added that Metropolitan Planning Organization funding is tied up for the next three years. Mr. Garcia said the estimates do not include utility costs. Mr. David Seiler said many of the city's streets have needed additional capacity and improvements for quite some time. Mayor Neal suggested that staff develop a debt model for a bond election in 2004. Mr. McDaniel said that beginning in 2009, the city will have a debt capacity of $98 million (assuming a 3% growth in valuations). Ms. Barbara Dolce, Street Superintendent, described the city's pavement management program and Mr. Escobar further described the difference between new construction and reconstruction projects. Mr. Kinnison referred to a future bond program for streets, saying the Council should let the citizens decide how much debt they think they can handle in order to accomplish these overdue projects. Mr. Garcia said the street cost estimates are linked to the utility rate numbers. Mr. Escobar pointed out that with the Bond 2000 projects, for every $1 of street work, construction crews are having to do $1 of utility work. Consequently, there is $20 million of utility work associated with the $20 million in street work approved by the voters. Staff members further responded to Council members' questions about specific street projects. There were no comments from the public. In conclusion, Mayor Neal referred to a chart showing the impact of proposed rate increases on an average residential utility bill. He said that information needs to be disseminated. Mr. McDaniel said the reason the utility bill itself does not increase by 6% is because the raw water charge increase is only 3% and because solid waste fees (which are also included) are not changing. Mr. Garcia said that on April 30th, staff will bring back the detailed analysis the Council requested. The Mayor said it is important that the Council and staff initiate an intensive community informational program about the meaning of "debt." He said debt that is properly incurred, financed and approved for a good purpose improves the quality of life in cities. He said the presentations made at this meeting illustrate the consequences of not investing in the city's infrastructure. There being no further business to come before the Council, Mayor Neal adjourned the Council meeting at 5:27 p.m. on April 2, 2002. * * * * * * * * * * * * *