HomeMy WebLinkAboutAgenda Packet City Council - 11/14/2017 (SP) City of Corpus Christi 1201 Leopard Street
Corpus Christi,TX 78401
cctexas.com
Meeting Agenda Final
Special City Council Meeting
Tuesday, November 14,2017 9:00 AM Council Chambers
SPECIAL CITY COUNCIL MEETING
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48 hours in advance so that appropriate arrangements can be made.
A. Mayor Joe McComb to call the meeting to order.
B. City Secretary Rebecca Huerta to call the roll of the required Charter Officers.
C. PUBLIC INTERVIEWS FOR FINANCIAL ADVISOR FINALISTS
The City Council will conduct public interviews with the finalists for the financial advisor
services agreement. No public comment will be solicited.
D. REGULAR AGENDA: (ITEM 1)
1. 17-1360 Service Agreement for Financial Advisor Services for a One-Year
Not-To-Exceed Amount of$171,000.00 With Four One-Year Options
for a Potential Not-To-Exceed Amount of$870,000.00
Motion authorizing the City Manager or designee to execute a service
agreement with FirstSouthwest, a Division of Hilltop Securities, Inc., Dallas,
Texas for financial advisor services for the Finance Department, in
accordance with RFP No. 1306, based on the best value proposal. The
agreement will be for a not-to-exceed amount of$171,000.00, which will be
funded in FY2017-2018 primarily from bond proceeds. The term of the
agreement is for one year, with four one-year options subject to the sole
City of Corpus Christi Page 1 Printed on 11/13/2017
Special City Council Meeting Meeting Agenda-Final November 14,2017
discretion of the City, with a total potential multi-year not-to-exceed amount
of$870,000.00.
Attachments: Agenda Memo- Financial Advisor
Evaluation Matrix Council
Final Service Agreement KR Signed 10.20.17
Corpus Christi TX- 1295 Form
Corpus Christi TX-MA Disclosure Statement
E. ADJOURNMENT
City of Corpus Christi Page 2 Printed on 11/13/2017
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AGENDA MEMORANDUM
Future Item for the City Council Meeting of October 31, 2017
NCORROP pEO
1852 Action Item for the City Council Meeting of November 7, 2017
DATE: October 31, 2017
TO: Margie C. Rose, City Manager
FROM: Sylvia Carrillo-Trevino, Assistant City Manager
SylviaCa c(�cctexas.com
(361) 826-3189
Kim Baker, Assistant Director of Financial Services—Purchasing Division
KimB2 c(-).cctexas.com
(361) 826-3169
Financial Advisor Services for a One-Year Not-to-Exceed Amount of $171,000.00,
with Four One-year Options and a Total Potential Multi-Year Not-to-Exceed
Amount of $870,000.00
CAPTION:
Motion authorizing the City Manager or designee to execute a service agreement with
FirstSouthwest, a Division of Hilltop Securities, Inc., Dallas, Texas for financial advisor
services for the Finance Department, in accordance with RFP No. 1306, based on the
best value proposal. The agreement will be for a not-to-exceed amount of $171,000.00,
which will be funded in FY2017-2018 primarily from bond proceeds. The term of the
agreement is for one year, with four one year options subject to the sole discretion of the
City, with a total potential multi-year not-to-exceed amount of$870,000.00.
PURPOSE:
The purpose of this agenda item is to execute a contract for financial advisor services to
assist the City with financial matters including but not limited to bond sales.
BACKGROUND AND FINDINGS:
The City has used the same financial advisor for a number of years and a determination
was made that a new solicitation should be undertaken to pursue a new contract for these
services. In anticipation of a number of bond sales in the near future staff issued the
request for proposals (RFP). Seven proposals were received; however, one was deemed
nonresponsive. The remaining six responsive proposals moved on in the process and
were evaluated by an evaluation team against the published criteria in the RFP. Minimum
qualifications were evaluated under a pass fail system and the firms experience and
understanding of the scope of work were evaluated on the published point system as
outlined in the RFP. The firms were also interviewed and scored based on the same
published criteria and a final score was developed for each firm. Pricing for each firm was
then evaluated to determine the pricing scores. The Capital Improvement Program along
with an estimated number of consulting hours was used as the basis for applying the
pricing from each firm to determine the lowest cost for the City over the life of the contract.
The staff recommends awarding a service agreement to FirstSouthwest for the financial
advisor services for the City's Finance Department as the highest scoring proposer.
ALTERNATIVES:
Continue to utilize financial advisors on a per bond sale transaction as is currently being
done.
OTHER CONSIDERATIONS:
No feasible considerations
CONFORMITY TO CITY POLICY:
This purchase conforms to the City's purchasing policies and procedures and State
Statues regulating procurements.
EMERGENCY/ NON-EMERGENCY:
Non-emergency
DEPARTMENTAL CLEARANCES:
City Manager's Office and Financial Services Department
FINANCIAL IMPACT:
❑Operating ❑ Revenue ❑ Capital X Not applicable
Fiscal Year:
2017-2018 Current Year Future Years TOTALS
Line Item Budget $ $ $
Encumbered /
Expended Amount $ $ $
This item $ $ $
BALANCE $ $ $
Fund(s): N/A
Comments: The funding for this contract will be provided from bond proceeds for the
general obligation, revenue and refunding bond sales and by various department budgets
for the small consulting service component of the contract.
RECOMMENDATION:
Staff recommends approval of the Motion.
LIST OF SUPPORTING DOCUMENTS:
Service Agreement
RFP Matrix — Financial Advisor Services
Municipal Advisor Disclosure Statement
RFP No.1306-Financial Advisor Services
Kim Baker
olosa
Proposal Evaluation Samco Capital Markets PFM**7 RBC Capital Markets TKG&Associates FirstSouthwest M.E.Allison&Co. Estrada Ban
p Investmentt Bankers kers
Minimum Qualifications Pass FAIL Pass Pass Pass Pass Pass
Licensing/Registration Pass Fail*1 Pass Pass Pass Pass Pass
Required 5 years in Business Pass Pass Pass Pass Pass Pass Pass
No outstanding lawsuits/lifigafion with City
Pass Pass Pass*3 Pass Pass Pass Pass
during lost years
No outstanding regulatory issues last 5 years,No
Pass Pass Pass*4 Pass Pass*5 Pass Pass*6
outstanding FIN RA,SEC issues last years
References Provided for firm Pass Fail*2 pass Pass Pass Pass Pass
Technical Proposal
Technical Proposal(50 points) 44.50 0;00 43.00 44.25 49.25 45.50 47.75
Experience
Team Experience
Understanding of Project Scope
Interview
Interview(30 points) 23.50 0.00 28.00 22.00 29.50 23.00 30.00
Experience
Team Experience
Understanding of Project Scope
SUBTOTAL QUALIFICATIONS 68.00 0.00 71.00 66.25 78.75 68.50 77.75
Price
Price(20 points) 9.78 0.00 8.89 20.00 17.83 19.34 14.09
Total 77.78 0.00 79.89 86.25 96.58 87.84 91.84
6 5 4 1 3 2
*1-Registration indicated but not provided
*2-References Provided but not on required forms and only provided out of 6 requested
*3-Legal issues not disclosed as required
*4-Regulatory Issues indicated by FI NRA see printout non outstanding
*5-Regulatory Issues indicated by FINRA see printout non outstanding
*6-Regulatory Issues indicated by FINRA see printout and proposal non outstanding
**7-Took major exceptions to contract and RFP not allowed at this stage
SC
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SERVICE AGREEMENT NO. 1306
Cam" A
1&132 Fiancial Advisor Services
THIS Financial Advisor Services Agreement ("Agreement") is entered into by
and between the City of Corpus Christi, a Texas home-rule municipal corporation
("City") and FirstSouthwest, a Division of Hilltop Securities, Inc. ("Contractor"),
effective upon execution by the City Manager or the City Manager's designee
("City Manager").
WHEREAS, Contractor has bid to provide Financial Advisor Services in
response to Request for Bid/Proposal No. 1306 ("RFB/RFP"),which RFB/RFP includes
the required scope of work and all specifications and which RFB/RFP and the
Contractor's bid or proposal response, as applicable, are incorporated by
reference in this Agreement as Exhibits 1 and 2, respectively, as if each were fully
set out here in its entirety.
NOW, THEREFORE, City and Contractor agree as follows:
1. Scope. Contractor will provide Financial Advisor Services ("Services") in
accordance with the attached Scope of Work, as shown in Attachment A,
the content of which is incorporated by reference into this Agreement as if
fully set out here in its entirety, and in accordance with Exhibit 2.
2. Term. This Agreement is for twelve months, with performance commencing
upon the date of issuance of a notice to proceed from the Contract
Administrator or Purchasing Division. This Agreement includes an option to
extend the term for up to four additional twelve-month periods ("Option
Period"), provided, the parties do so prior to expiration of the original term or
the then-current Option Period. The decision to exercise the option to extend
the term of this Agreement is, at all times, within the sole discretion of the City
and is conditioned upon the prior written agreement of the Contractor and
the City Manager.
3. Compensation and Payment. The total value of this Agreement is not to
exceed $171,000.00, subject to approved extensions and changes. Payment
will be made for Services completed and accepted by the City within 30
days of acceptance, subject to receipt of an acceptable invoice. All pricing
must be in accordance with the attached Bid/Pricing Schedule, as shown in
Attachment B, the content of which is incorporated by reference into this
Agreement as if fully set out here in its entirety.
City of Corpus Christi Page ] of 8
Service Agreement Standard Form
Approved as to Legal Form 7/1/16
4. Contract Administrator. The Contract Administrator designated by the City is
responsible for approval of all phases of performance and operations under
this Agreement, including deductions for non-performance and
authorizations for payment. The City's Contract Administrator for this
Agreement is as follows:
Constance Sanchez
Finance
phone: 361 .826.3227
Email: ConstanceP@cctexas.com
5. Insurance; Bonds.
(A) Before performance can begin under this Agreement, the Contractor
must deliver a certificate of insurance ("COi"), as proof of the required
insurance coverages, to the City's Risk Manager and the Contract
Administrator. Additionally, the COI must state that the City will be given at
least 30 days' advance written notice of cancellation, material change in
coverage, or intent not to renew any of the policies. The City must be named
as an additional insured. The City Attorney must be given copies of all
insurance policies within 10 days of the City Manager's written request.
Insurance requirements are as stated in Attachment C, the content of which
is incorporated by reference into this Agreement as if fully set out here in its
entirety.
(B) In the event a payment bond, a performance bond, or both, are
required of the Contractor to be provided to the City under this Agreement
before performance can commence, the terms, conditions, and amounts
required in the bonds and appropriate surety information are as included in
the RFB/RFP or as may be added to Attachment C, and such content is
incorporated here in this Agreement by reference as if each bond's terms,
conditions, and amounts were fully set out here in its entirety.
6. Purchase Release Order. For multiple-release purchases of Services to be
provided by the Contractor over a period of time, the City will exercise its
right to specify time, place and quantity of Services to be delivered in the
following manner: any City department or division may send to Contractor
a purchase release order signed by an authorized agent of the department
or division. The purchase release order must refer to this Agreement, and
Services will not be rendered until the Contractor receives the signed
purchase release order.
City of Corpus Christi Page 2 of 8
Service Agreement Standard Form
Approved as to Legal Form 711116
7. Inspection and Acceptance. Any Services that are provided but not
accepted by the City must be corrected or re-worked immediately at no
charge to the City. If immediate correction or re-working at no charge
cannot be made by the Contractor, a replacement service may be
procured by the City on the open market and any costs incurred, including
additional costs over the item's bid/proposal price, must be paid by the
Contractor within 30 days of receipt of City's invoice.
8. Warranty. The Contractor warrants that all products supplied under this
Agreement are new, quality items that are free from defects, fit for their
intended purpose, and of good material and workmanship. The Contractor
warrants that it has clear title to the products and that the products are free
of liens or encumbrances. In addition, the products purchased under this
Agreement shall be warranted by the Contractor or, if indicated in
Attachment D by the manufacturer, for the period stated in Attachment D.
Attachment D is attached to this Agreement and is incorporated by
reference into this Agreement as if fully set out here in its entirety.
9. Quality/Quantity Adjustments. Any Service quantities indicated on the
Bid/Pricing Schedule are estimates only and do not obligate the City to order
or accept more than the City's actual requirements nor do the estimates
restrict the City from ordering less than its actual needs during the term of the
Agreement and including any Option Period. Substitutions and deviations
from the City's product requirements or specifications are prohibited without
the prior written approval of the Contract Administrator,
10. Non-Appropriation. The continuation of this Agreement after the close of
any fiscal year of the City, which fiscal year ends on September 30th annually,
is subject to appropriations and budget approval specifically covering this
Agreement as an expenditure in said budget, and it is within the sole
discretion of the City's City Council to determine whether or not to fund this
Agreement. The City does not represent that this budget item will be
adopted, as said determination is within the City Council's sole discretion
when adopting each budget.
11. Independent Contractor. Contractor will perform the work required by this
Agreement as an independent contractor and will furnish such Services in its
own manner and method, and under no circumstances or conditions will any
agent, servant or employee of the Contractor be considered an employee
of the City.
12. Subcontractors. Contractor may use subcontractors in connection with the
work performed under this Agreement. When using subcontractors,
City of Corpus Christi Page 3 of 8
Service Agreement Standard Form
Approved as to Legal Form 7/1/16
however, the Contractor must obtain prior written approval from the
Contract Administrator if the subcontractors were not named at the time of
bid or proposal, as applicable. In using subcontractors, the Contractor is
responsible for all their acts and omissions to the same extent as if the
subcontractor and its employees were employees of the Contractor. All
requirements set forth as part of this Agreement, including the necessity of
providing a CCI in advance to the City, are applicable to all subcontractors
and their employees to the some extent as if the Contractor and its
employees had performed the work.
13. Amendments. This Agreement may be amended or modified only by written
change order signed by both parties. Change orders may be used to modify
quantities as deemed necessary by the City.
14. Waiver. No waiver by either party of any breach of any term or condition of
this Agreement waives any subsequent breach of the some.
15. Taxes. The Contractor covenants to pay payroll taxes, Medicare taxes, FICA
taxes, unemployment taxes and all other related taxes. Upon request, the
City Manager shall be provided proof of payment of these taxes within 15
days of such request.
16. Notice. Any notice required under this Agreement must be given by fax,
hand delivery, or certified mail, postage prepaid, and is deemed received
on the day faxed or hand-delivered or on the third day after postmark if sent
by certified mail, Notice must be sent as follows:
1F TO CITY:
City of Corpus Christi
Attn: Constance Sanchez
Director of Finance
Address: 1201 Leopard Street, Corpus Christi, Texas 78401
Fax: 361 .826.4376
IF TO CONTRACTOR:
FirstSouthwest, a Division of Hilltop Securities, Inc.
Attn: Anne Burger Entrekin
Regional Managing Director
70 Northeast Loop 410, Suite 710, San Antonio, Texas 78216
Fax: 210.349.7585
City of Corpus Christi Page 4 of 8
Service Agreement Standard Form
Approved as to Legal Form 7/l/16
17. CONTRACTOR AGREES TO INDEMNIFY, HOLD HARMLESS AND
DEFEND THE CITY OF CORPUS CHRISTI AND ITS OFFICERS,
EMPLOYEES AND AGENTS ("INDEMNITEES') FROM AND AGAINST
ANY AND ALL LIABILITY, LOSS, CLAIMS, DEMANDS, SUITS AND
CAUSES OF ACTION OF ANY NATURE WHATSOEVER ON ACCOUNT
OF PERSONAL INJURIES (INCLUDING DEATH AND WORKERS'
COMPENSATION CLAIMS), PROPERTY LOSS OR DAMAGE, OR ANY
OTHER KIND OF INJURY, LOSS, OR DAMAGE, INCLUDING ALL
EXPENSES OF LITIGATION, COURT COSTS, ATTORNEYS' FEES AND
EXPERT WITNESS FEES WHICH ARISE OR ARE CLAIMED TO ARISE OUT
OF OR IN CONNECTION WITH THIS AGREEEMENT OR THE
PERFORMANCE OF THIS AGREEMENT, REGARDLESS OF WHETHER THE
INJURIES, DEATH OR DAMAGES ARE CAUSED OR ARE CLAIMED TO
BE CAUSED BY THE CONCURRENT OR CONTRIBUTORY NEGLIGENCE
OF INDEMNITEES, BUT NOT IF BY THE SOLE NEGLIGENCE OF
INDEMNITEES UNMIXED WITH THE FAULT OF ANY OTHER PERSON.
CONTRACTOR MUST, AT ITS OWN EXPENSE, INVESTIGATE ALL
CLAIMS AND DEMANDS, ATTEND TO THEIR SETTLEMENT OR OTHER
DISPOSITION, DEFEND ALL ACTIONS BASED THEREON WITH COUNSEL
SATISFACTORY TO THE CITY ATTORNEY, AND PAY ALL CHARGES OF
ATTORNEYS AND ALL OTHER COSTS AND EXPENSES OF ANY KIND
ARISING FROM ANY SAID LIABILITY, DAMAGE, LOSS, CLAIMS,
DEMANDS, SUITS, OR ACTIONS. THE INDEMNIFICATION
OBLIGATIONS OF CONTRACTOR UNDER THIS SECTION SHALL
SURVIVE THE EXPIRATION OR EARLIER TERMINATION OF THIS
AGREEMENT.
18. Termination.
(A) The City Manager may terminate this Agreement for Contractor's failure
to perform the work specified in this Agreement or to keep any required
insurance policies in force during the entire term of this Agreement. The
Contract Administrator must give the Contractor written notice of the breach
and set out a reasonable opportunity to cure. If the Contractor has not
cured within the cure period, the City Manager may terminate this
Agreement immediately thereafter.
City of Corpus Christi Page 5 of 8
Service Agreement Standard Form
Approved as to Legal Form 7/1/16
(B) Alternatively, the City Manager may terminate this Agreement for
convenience upon 30 days advance written notice to the Contractor. The
City Manager may also terminate this Agreement upon 24 hours written
notice to the Contractor for failure to pay or provide proof of payment of
taxes as set out in this Agreement,
19. Assignment. No assignment of this Agreement by the Contractor, or of any
right or interest contained herein, is effective unless the City Manager first
gives written consent to such assignment. The performance of this
Agreement by the Contractor is of the essence of this Agreement, and the
City Manager's right to withhold consent to such assignment is within the sole
discretion of the City Manager on any ground whatsoever.
20. Severability. Each provision of this Agreement is considered to be severable
and, if, for any reason, any provision or part of this Agreement is determined
to be invalid and contrary to applicable law, such invalidity shall not impair
the operation of nor affect those portions of this Agreement that are valid,
but this Agreement shall be construed and enforced in all respects as if the
invalid or unenforceable provision or part had been omitted.
21. Order of precedence. In the event of any conflicts or inconsistencies
between this Agreement, its attachments, and exhibits, such conflicts and
inconsistencies will be resolved by reference to the documents in the
following order of priority:
A. this Agreement and its attachments
B. the bid solicitation document, including addenda (Exhibit 1)
C. the Contractor's bid response (Exhibit 2)
22. Certificate of interested parties. Contractor agrees to comply with Texas
Government Code Section 2252.908, as it may be amended, and to
complete Form 1295 "Certificate of Interested Parties" as part of this
Agreement.
23. Governing Law. This Agreement is subject to all federal, State, and local laws,
rules, and regulations. The applicable law for any legal disputes arising out
of this Agreement is the law of the State of Texas, and such form and venue
for such disputes is the appropriate district, county, or justice court in and for
Nueces County, Texas.
24. Entire Agreement.This Agreement constitutes the entire agreement between
the parties concerning the subject matter of this Agreement and supersedes
City of Corpus Christi Page 6 of 8
Service Agreement Standard Form
Approved as to Legal Form 711/16
all prior negotiations, arrangements, agreements and understandings, either
oral or written, between the parties.
(SIGNATURE PAGE FOLLOWS)
City of Corpus Christi Page 7 of 8
Service Agreement Standard Form
Approved as to Legal Form 7/1/16
CONTRACTOR �
Signature. d4vk�
Printed Name: 10-
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Title: � 2 a vti
Date: �/7j 0 I
CITY OF CORPUS CHRISTI
Signature:
Printed Name:
Title:
Date:
Attached and Incorporated by Reference:
Attachment A: Scope of Work
Attachment B: Bid/Pricing Schedule
Attachment C: Insurance/Bond Requirements
Attachment D: Warranty Requirements
Incorporated by Reference Only:
Exhibit 1 : RFB/RFP No. 1306
Exhibit 2: Contractor's Bid/Proposal Response
City of Corpus Christi Page 8 of S
Service Agreement Standard Form
Approved as to Legal Form 7/1/16
Affachment A - Scope of Work
Financial Advisor Services
1.1. General Requirements
The Financial Advisor will assist the City in the management of its debt program
and the design and issuance, negotiation and writing of bonds, certificates, tax
notes, and other financial instruments as may be required. Financial Advisor
Services include, but are not limited to, quantitative analysis, evaluation and
presentation of financing options, provisions of timely credit market information,
preparation of offering documents, advice and assistance with the issuance,
sale and delivery of debt instruments, as well as, attending meetings and the
provision of ongoing services after the successful delivery of a debt issuance.
1.2. Scope of Work
A. Structure
The Financial Advisor is expected to actively participate in, and lend expertise
to the financial structuring of the bond issue, in conjunction with City's Bond
Counsel and City staff.
B. Official Statements
The City, from time to time, will consider the utilization of various types of debt
including, but not limited to, general obligation bonds, certificates of obligation,
fax notes, commercial paper, revenue bonds, conduit financings including, but
not limited to, housing, education, healthcare, economic development, and
other types of financings which will facilitate the most effective, efficient and
most cost effective method of financing projects. The Financial Advisor will be
required to perform professional Financial Advisory Services in connection with
the pre-sale strategic financial analyses, authorization, on-going quantitative
analysis, marketing, preparation of offering documents, issuance, sale and
delivery of debt instruments, as well as provide ongoing service after the
successful delivery of a debt issue. The Financial Advisor will be required to
provide professional services and perform theses duties as determined by the
City.
The preliminary and final official statements will be prepared by the City's
financial advisor and its bond counsel. The City will provide to the Financial
Advisor its customary disclosure information and will make every effort to
provide the financial advisor with all necessary additional information for the
specific financing. It is the duty of the financial advisor to thoroughly review and
determine the completeness and accuracy of any material representations set
forth in the preliminary and final official statements. The Financial Advisor will be
responsible to the City in all aspects for the accuracy and completeness of
information provided by such Financial Advisor with respect to such disclosure
documents. More specifically the Financial Advisor will be responsible for the
following:
1 . All duties and services necessary or advisable to facilitate the issuance of
bonds and other obligations,
2. Determine the form, size, timing, and method of sale of the issue;
3. Assist in evaluating underwriting proposals and selecting underwriting
teams, including the development of a Request for Proposals;
4. Participate in document preparation and assist bond counsel in the
coordination of the issue;
5. Prepare information for rating agency presentations, schedule and assist in
the presentations, and act as liaison with the agencies, providing
information as needed;
6. Coordinate preparation of official statements for each issue, including
arranging for printing and mailing to prospective investors;
7. Advise the City concerning the need for credit enhancement and assist in
the procurement and negotiation of related agreements
8. Respond to questions or requests for additional information from
prospective investors
9. Coordinate bond sale bid openings or electronic bid verifications and
recommend acceptance or rejection of bids. Evaluate reception of the
bonds relative to the market and other comparable securities
10. Monitor and control fees and expenses incurred in connection with the
issuance of bonds, including soliciting bids for the printing of bond offering
documents, ratings, trustee and paying agent fees and related services
when necessary;
11 . Assist in closing details and post-closing duties. Maintain debt service
records on all outstanding City of Corpus Christi obligations
12. Monitor and advise the City on refunding opportunities and other financial
products that would benefit the City;
13. Evaluate the performance of remarketing agents and credit facilities for
commercial paper programs and variable rate demand notes, including
rates, fees, and other costs;
14. Provide advice and assistance in complying with disclosure requirements;
15. Provide assistance in the development of alternative financing programs for
potential capital projects, including funding available from state and
federal programs;
16. Provide assistance in the development of voted bond programs, including
working with citizen committees;
17. Evaluate the city's financial policies related to effective administration of
the capital program;
18. Advise the City of current issues in the securities industry and financial
markets, including the impact of pending legislation at the state and
federal levels;
19. Advice regarding the investment of bond proceeds
20. Advise the City in all other matters necessary or incidental to the issuance
and administration of debt obligation.
21 . The Financial Advisor will not be permitted to underwrite a portion of an issue
or program for the City during the term of an engagement as Financial
Advisor.
22. Each member of the underwriting syndicate is expected to play an active
role in the placement of the obligations. The Financial Advisor will provide a
report of the final allotments/placements executed by each member as
soon as practical after closing.
C. Other Financial Consultation
Occasionally the City may need to reach out to the Financial Advisor for other
financial advice needed by the City that is not related to the sale of bonds or
items outlined in the regular scope of work in the sections above. When this
occurs the City staff will identify the work as falling into this "Other Financial
Consultation" category and the Financial Advisor will be compensated as
outlined on the pricing sheets on a loaded hourly rate basis for this service.
Attachment B -- Schedule of Pricing
C1S CIS,
0C3
CITY OF CORPUS CHRISTI
Pricing Form
PURCHASING DIVISION
C ,6e.1 v
RFP Na. 1306
Financial Advisor Services
PAGE 1 OF 1
DATE: sept. 19,2fl17 � � 0Z
FirstSouthwest,a Division of Hillto Securities Inc.
PROPOSER AUTHORIZED SIGNATURE Vickie Hall
Vice President
1. Refer to "instructions to Proposers" and Contract Terms and Conditions before completing
proposal.
2. Provide your best price for each item.
3. In submitting this proposal, Proposer certifies that:
a. the prices in this proposal have been arrived at independently,without consultation,
communication, or agreement with any other Proposer or competitor, for the purpose
of restricting competition with regard to prices;
b. Proposer is an Equal Opportunity Employer;and the Disclosure of Interest information
on file with City's purchasing office, pursuant to the Carie of Ordinances, is current
and true.
C, Proposer has incorporated any changes issue through Addenda to the RFP in this
pricing.
ITEM DESCRIPTION Value of Value of Bond Price/Percentage!
Bond
$0 $1,000,000 $15,000 Flat
1,000,001 $5,000,000 0.43%-not less than$15,000
$5,000,001 $10,000,000 0.315%upio$31,500
Issuance of bonds backed by $10,000,001 $25,000,000 0.18%upto$45,000
1 the full faith and credit of the $25,000,001 $50,000,000 0.13,4 up to$65,000
City $50,000,001 $100,000,000 0.10 upto 6108,000
$100,000,001 $200,000,000 0.03%up to$145,000
$200,000,001 $300,000,000 0-065%up to$106,000
$300,000,001 Anything over 5200,000 Capped
2 Issuance of revenue bonds Fee scheduleahove+20%
3 Issuance of refunding bonds Above fee schedule c 10/
Loaded Hourly Rate
A Other Financial Consultation 5225
*Expressed as a percent of par.
Attachment C - Insurance Requirements
Insurance Requirements
I. CONTRACTOR'S LIABILITY INSURANCE
A. Contractor must not commence work under this contract until all
insurance required has been obtained-and such insurance has been
approved by the City. Contractor must not allow any subcontractor,
to commence work until all similar insurance required of any
subcontractor has been obtained.
B. Contractor must furnish to the City's Risk Manager and Contract
Administrator one (1) copy of Certificates of Insurance with applicable
policy endorsements showing the following minimum coverage by an
insurance company(s) acceptable to the City's Risk Manager.The City
must be listed as an additional insured on the General liability and Auto
Liability policies by endorsement, and a waiver of subrogation
endorsement is required on GL, AL and WC if applicable.
Endorsements must be provided with Certificate of Insurance. Project
name and/or number must be listed in Description Box of Certificate of
Insurance.
TYPE OF INSURANCE MINIMUM INSURANCE
COVERAGE
30-day advance written Bodily Injury and
notice of cancellation, non- Property Damage
renewal, material change or Per occurrence -
termination required on all aggregate
certificates and policies.
COMMERCIAL GENERAL LIABILITY $1,000,000 Per Occurrence
including: $2,000,000 Aggregate
1 . Commercial Broad Form
2. Premises - Operations
3. Products/Completed
Operations
4. Contractual Liability
5. Independent Contractors
6. Personal Injury- Advertising
Injury
AUTO LIABILITY (including) $1,000,000 Combined
1. Owned Single Limit
2. Hired and Non-Owned
3. Rented/Leased
WORKERS'S COMPENSATION Statutory and
(All States Endorsement if complies with Part II of
Company is not domiciled in this Exhibit.
Texas)
Employers Liability $500,0001$500,0001$50
0,000
PROFESSIONAL LIABILITY $1,000,000 Per Claim
(Errors and Omissions) (Defense costs not
included in face value
of the policy)
if claims made policy,
retro date must be
prior to inception of
agreement, have
extended reporting
period provisions and
identify any limitations
regarding who is
insured.
C. In the event of accidents of any kind related to this contract,
Contractor must furnish the Risk Manager with copies of all reports of
any accidents within 10 days of the accident.
II. ADDITIONAL REQUIREMENTS
A. Applicable for paid employees, Contractor must obtain workers'
compensation coverage through a licensed insurance company. The
coverage must be written on a policy and endorsements approved
by the Texas Department of Insurance. The workers' compensation
coverage provided must be in statutory amounts according to the
Texas Department of Insurance, Division of Workers' Compensation.
An All States Endorsement shall be required if Contractor is not
domiciled in the State of Texas.
B. Contractor shall obtain and maintain in full force and effect for the
duration of this Contract, and any extension hereof, at Contractor's
sole expense, insurance coverage written on an occurrence basis by
companies authorized and admitted to do business in the State of
Texas and with an A.M. Best's rating of no less than A- VIL
C. Contractor shall be required to submit renewal certificates of
insurance throughout the term of this contract and any extensions
within 10 days of the policy expiration dates. All notices under this
Exhibit shall be given to City at the following address:
Attn: Risk Manager
P.O. Box 9277
Corpus Christi, TX 78469-9277
D. Contractor agrees that, with respect to the above required insurance,
all insurance policies are to contain or be endorsed to contain the
following required provisions:
• List the City and its officers, officials, employees, and volunteers, as
additional insureds by endorsement with regard to operations,
completed operations, and activities of or on behalf of the named
insured performed under contract with the City, with the exception
of the workers' compensation policy;
• Provide for an endorsement that the "other insurance" clause shall
not apply to the City of Corpus Christi where the City is an
additional insured shown on the policy;
• Workers' compensation and employers' liability policies will provide
a waiver of subrogation in favor of the City, and
• Provide thirty (30) calendar days advance written notice directly
to City of any, cancellation, non-renewal, material change or
termination in coverage and not less than ten (10) calendar days
advance written notice for nonpayment of premium.
E. Within five (5) calendar days of a cancellation, non-renewal, material
change or termination of coverage, Contractor shall provide a
replacement Certificate of Insurance and applicable endorsements
to City. City shall have the option to suspend Contractor's
performance should there be a lapse in coverage at any time during
this contract. Failure to provide and to maintain the required
insurance shall constitute a material breach of this contract.
F. In addition to any other remedies the City may have upon
Contractor's failure to provide and maintain any insurance or policy
endorsements to the extent and within the time herein required, the
City shall have the right to order Contractor to stop work hereunder,
and/or withhold any payment(s) which become due to Contractor
hereunder until Contractor demonstrates compliance with the
requirements hereof.
G. Nothing herein contained shall be construed as limiting in anyway the
extent to which Contractor may be held responsible for payments of
damages to persons or property resulting from Contractor's or its
subcontractor's performance of the work covered under this
contract.
H. It is agreed that Contractor's insurance shall be deemed primary and
non-contributory with respect to any insurance or self insurance
carried by the City of Corpus Christi for liability arising out of operations
under this contract.
I. It is understood and agreed that the insurance required is in addition
to and separate from any other obligation contained in this contract.
2017 Insurance Requirements
Purchasing
Financial Advisor Services
05/15/2017 sw Risk Management
Attachment D - Warranty
(No warranties are required under this contract therefore Section 8. Warranty in the
contract is hereby null and void)
CERTIFICATE OF INTERESTED PARTIES FORM 1295
10f1
Complete Nos. 1-4 and 6 if there are interested parties. OFFICE USE ONLY
Complete Nos. 1,2,3,5, and 6 it there are no interested parties. CERTIFICATION OF FILING
1 Name of business entity filing form,and the city,state and country of the business entity's place Certificate Number:
of business. 1 2017-273274
FirstSouthwest,a Division of Hilltop Securities Inc.
Dallas,TX United States Date Filed:
2 Name of governmental entity or state agency that is a party to the contract for which the form is 10/1712017
being filed.
City of Corpus Christi Date Acknowledged:
3 Provide the identification number used by the governmental entity or state agency to track or identify the contract,and provide a
description of the services,goods,or other property to he provided under the contract.
RFP 1306-FA-2017
Financial Advisory Services
A Nature of interest
Name of Interested Party City,State,Country(place of business) (check applicable)
Controlling Intermediary
Feinberg , Hill A Dallas,TX United States X
Peterson, Robert W Dallas,TX United States X
Muschalek,John R Dallas, TX United States X
Edge ,J Michael Dallas, TX United States X
Leventhal, Laura Dallas, TX United States X
Marz, Michael J Dallas, TX United States X
Medanich, David K Dallas, TX United States X
Alexander, Laura Dallas, TX United States X
Hilltop Securities Holdings LLC Dallas, TX United States X
5 Check only if there is NO Interested Party. ❑
6 AFFIDAVIT I swear,or affirm, under penalty of perjury,that the above disclosure is true and correct.
KELLY BRAGG
My Notary Id#125389726 f/r
Expires September 20,2020 !�
Signature of authorized agent of contracting business entity
AFFIX NOTARY STAMP 1 SEAL ABOVEr I
Sworn to and subscribed before me, by the said —` b Y la l.0 1 1 Lit a-)O ,this the day of
20 ,to certify which,witness my hand and seal of office.
1�1�11 21�' L P1,
igna re of off Aer administering oath Printed name of fficer admd st ing oath Title of off administering oath
Forms provided by Texas Ethics Commission www.ethics.state.tx.us Version V1.0.3337
CONFLICT OF INTEREST QUESTIONNAIRE FORM CIQ
For vendor doing business with local governmental entity
This questionnaire reflects changes made to the taw by H.B. 23, 84th Leg., Regular Session. OFFICE USE ONLY
This questionnaire is being filed in accordance with Chapter 176, Local Government Code, by a vendor who Date Received
has a business relationship as defined by Section 176.001(1-a) with a local governmental entity and the
vendor meets requirements under Section 176.006(a).
By law this questionnaire must be filed with the records administrator of the focal governmental entity not later
than the 7th business day after the date the vendor becomes aware of facts that require the statement to be
filed. See Section 176.006(a-1); Local Government Code.
A vendor commits an offense it the vendor knowingly violates Section 176.006, Local Government Code.An
offense under this section is a misdemeanor.
1 Name of vendor who has a business relationship with local governmental entity.
FirstSouthwest, a Division of Hilltop Securities Inc.
2
Check this box if you are filing an update to a previously filed questionnaire.(The law requires that you file an updated
completed questionnaire with the appropriate filing authority not later than the 7th business day after the date on which
you became aware that the originally filed questionnaire was incomplete or inaccurate.)
3 Name of local government officer about whom the information is being disclosed.
Not Applicable
Name of Officer
4 Describe each employment or other business relationship with the local government officer, or a family member of the
officer,as described by Section 176.003(a)(2)(A). Also describe any family relationship with the local government officer.
Complete subparts A and B for each employment or business relationship described. Attach additional pages to this Form
CIQ as necessary.
A. Is the local government officer or a family member of the officer receiving or likely to receive taxable income,
other than investment income, from the vendor?
O Yes E:1 No
B. Is the vendor receiving or likely to receive taxable income,other than investment income,from or at the direction
of the local government officer or a family member of the officer AND the taxable income is not received from the
local governmental entity?
Yes F-1 No
5 Describe each employment or business relationship that the vendor named in Section 1 maintains with a corporation or
other business entity with respect to which the local government officer serves as an officer or director,or holds an
ownership interest of one percent or more.
Not Applicable
6
Check this box if the vendor has given the local government officer or a family member of the officer one or more gifts
as described in Section 176.003(a)(2)(B), excluding gifts described in Section 176.003(a-1).
71 Firs thwest, a ),iyisioo of Hilltop Securities Inc.
By ' j
Sign re of ndor doing business with the governmental entity le
Form provided by Texas Ethics Commission www.ethics.state.lx_us Revised 11/30/2015
FirstSouthwest
A Division of Hilltop Securities_
MUNICIPAL ADVISOR DISCLOSURE STATEMENT
This disclosure statement (the "Conflict Disclosures") is provided by FirstSouthwest, a Division of
Hilltop Securities Inc.("the Firm")to you(the"Client")in connection with our current municipal advisory
agreement, ("the Agreement"). These Conflict Disclosures provide information regarding conflicts of
interest and legal or disciplinary events of the Firm that are required to be disclosed to the Client pursuant
to MSRB Rule G-42(b) and(c)(ii).
PART A—Disclosures of Conflicts of Interest
MSRB Rule G-42 requires that municipal advisors provide to their clients disclosures relating to any actual
or potential material conflicts of interest, including certain categories of potential conflicts of interest
identified in Rule G-42, if applicable.
Material Conflicts of Interest—The Firm makes the disclosures set forth below with respect to material
conflicts of interest in connection with the Scope of Services under the Agreement with the Firm, together
with explanations of how the Firm addresses or intends to manage or mitigate each conflict.
General Mitigations — As general mitigations of the Firm's conflicts, with respect to all of the conflicts
disclosed below, the Firm mitigates such conflicts through its adherence to its fiduciary duty to Client,
which includes a duty of loyalty to Client in performing all municipal advisory activities for Client. This
duty of loyalty obligates the Firm to deal honestly and with the utmost good faith with Client and to act in
Client's best interests without regard to the Firm's financial or other interests.In addition,because the Firm
is a broker-dealer with significant capital due to the nature of its overall business, the success and
profitability of the Firm is not dependent on maximizing short-term revenue generated from individualized
recommendations to its clients but instead is dependent on long-term profitability built on a foundation of
integrity, quality of service and strict adherence to its fiduciary duty. Furthermore, the Firm's municipal
advisory supervisory structure,leveraging our long-standing and comprehensive broker-dealer supervisory
processes and practices, provides strong safeguards against individual representatives of the Firm
potentially departing from their regulatory duties due to personal interests.The disclosures below describe,
as applicable, any additional initigations that may be relevant with respect to any specific conflict disclosed
below.
1. Affiliate Conflict. The Firm, directly and through affiliated companies, provides or may provide
seivices/advice/products to or on behalf of clients that are related to the Firm's advisory activities within
the Scope of Services outlined in the Agreement. First Southwest Asset Management (FSAM), a SEC-
registered affiliate of the Firm, provides post issuance services including arbitrage rebate and treasury
management. The Firm's arbitrage team verifies rebate and yield restrictions on the investments of bond
proceeds on behalf of clients in order to meet IRS restrictions. The treasury management division performs
portfolio management/advisor services on behalf of public sector clients. The Firm, through affiliate First
Southwest Advisory, provides a multi-employer trust tailor-made for public entities which allows them to
prefund Other Post-Employment Benefit liabilities. The Firm has a structured products desk that provides
advice to help clients mitigate risk though investment management,debt management and commodity price
risk management products. These products consist of but are not limited to swaps (interest rate, currency,
commodity), options, repos, escrow structuring and other securities. Continuing Disclosure services
provided by the Firm work with issuers to assist them in meeting disclosure requirements set forth in SEC
rule 15c2-12. Services include but are not limited to ongoing maintenance of issuer compliance, automatic
tracking of issuer's annual filings and public notification of material events. The Firm administers two
government investment pools for Texas governments;the Short-Term Asset Reserve Fund(TexSTAR)and
the Local Government Investment Cooperative(LOGIC). These programs offer Texas government entities
investment options for their cash management programs based on the entities specific needs. The Finn and
the aforementioned affiliate's business with a client could create an incentive for the Firm to recommend
to a client a course of action designed to increase the level of a client's business activities with the affiliates
or to recommend against a course of action that would reduce or eliminate a client's business activities with
the affiliates. Furthermore, this potential conflict is mitigated by the fact that the Firm and affiliates are
subject to their own comprehensive regulatory regime as a member of multiple self-regulatory organizations
in which compliance is verified by not only internal tests but annual external examinations.
II. Other Municipal Advisor or Underwriting Relationships. The Firm serves a wide variety of other
clients that may from time to time have interests that could have a direct or indirect impact on the interests
of Client. For example, the Firm serves as municipal advisor to other municipal advisory clients and, in
such cases, owes a regulatory duty to such other clients just as it does to Client. These other clients may,
from time to time and depending on the specific circumstances,have competing interests,such as accessing
the new issue market with the most advantageous timing and with limited competition at the time of the
offering. In acting in the interests of its various clients,the Firm could potentially face a conflict of interest
arising from these competing client interests.In other cases,as a broker-dealer that engages in underwritings
of new issuances of municipal securities by other municipal entities, the interests of the Firm to achieve a
successful and profitable underwriting for its municipal entity underwriting clients could potentially
constitute a conflict of interest if, as in the example above, the municipal entities that the Firm serves as
underwriter or municipal advisor have competing interests in seeking to access the new issue market with
the most advantageous timing and with limited competition at the time of the offering.None of these other
engagements or relationships would impair the Firm's ability to fulfill its regulatory duties to Client.
M. Secondary Market Transactions in Client's Securities. The Firm,in connection with its sales and
trading activities, may take a principal position in securities, including securities of Client, and therefore
the Firm could have interests in conflict with those of Client with respect to the value of Client's securities
while held in inventory and the levels of mark-up or mark-down that may be available in connection with
purchases and sales thereof. In particular, the Firth or its affiliates may submit orders for and acquire
Client's securities issued in an Issue under the Agreement from members of the underwriting syndicate,
either for its own account or for the accounts of its customers. This activity may result in a conflict of
interest with Client in that it could create the incentive for the Firm to make recommendations to Client that
could result in more advantageous pricing of Client's bond in the marketplace. Any such conflict is
mitigated by means of such activities being engaged in on customary terms through units of the Firm that
operate independently from the Firth's municipal advisory business, thereby reducing the likelihood that
such investment activities would have an impact on the services provided by the Firm to Client under this
Agreement.
IV. Broker-Dealer and Investment Advisory Business. The Firm is dually registered as a broker-
dealer and an investment advisor that engages in a broad range of securities-related activities to service its
clients,in addition to serving as a municipal advisor or underwriter. Such securities-related activities,which
may include but are not limited to the buying and selling of new issue and outstanding securities and
investment advice in connection with such securities, including securities of Client, may be undertaken on
behalf of, or as counterparty to, Client, personnel of Client, and current or potential investors in the
securities of Client.These other clients may,from time to time and depending on the specific circumstances,
have interests in conflict with those of Client, such as when their buying or selling of Client's securities
may have an adverse effect on the market for Client's securities,and the interests of such other clients could
create the incentive for the Finn to make recommendations to Client that could result in more advantageous
pricing for the other clients. Furthermore,any potential conflict arising from the firm effecting or otherwise
assisting such other clients in connection with such transactions is mitigated by means of such activities
being engaged in on customary terms through units of the Fine that operate independently from the Finn's
municipal advisory business, thereby reducing the likelihood that the interests of such other clients would
have an impact on the services provided by the Firm to Client.
2
V. Compensation-Based Conflicts. Fees that are based on the size of the issue are contingent upon
the delivery of the Issue. While this form of compensation is customary in the municipal securities market,
this may present a conflict because it could create an incentive for the Firm to recommend unnecessary
financings or financings that are disadvantageous to Client, or to advise Client to increase the size of the
issue.This conflict of interest is mitigated by the general mitigations described above.
Fees based on a fixed amount are usually based upon an analysis by Client and the Firm of, among other
things, the expected duration and complexity of the transaction and the Scope of Services to be performed
by the Firm. This form of compensation presents a potential conflict of interest because, if the transaction
requires more work than originally contemplated, the Firm may suffer a loss. Thus, the Firm may
recommend less time-consuming alternatives, or fail to do a thorough analysis of alternatives.This conflict
of interest is mitigated by the general mitigations described above.
Hourly fees are calculated with, the aggregate amount equaling the number of hours worked by Firm
personnel times an agreed-upon hourly billing rate.This form of compensation presents a potential conflict
of interest if Client and the Firm do not agree on a reasonable maximum amount at the outset of the
engagement, because the Firm does not have a financial incentive to recommend alternatives that would
result in fewer hours worked. This conflict of interest is mitigated by the general mitigations described
above.
PART B—Disclosures of Information RegardinlZ Le al Events and Disciplinary History
MSRB Rule G-42 requires that municipal advisors provide to their clients certain disclosures of legal or
disciplinary events material to its client's evaluation of the municipal advisor or the integrity of the
municipal advisor's management or advisory personnel.
Accordingly,the Firm sets out below required disclosures and related information in connection with such
disclosures.
L Material Leaal or Disciplinary Event. The Firm discloses the following legal or disciplinary events
that may be material to Client's evaluation of the Firm or the integrity of the Firm's management or advisory
personnel:.
For related disciplinary actions please refer to the Firm's BrokerCheck webpage.
• The Finn self-reported violations of SEC Rule 15c2-12; Continuing Disclosure. The Firm
settled with the SEC on February 2, 2016. The firm agreed to retain independent consultant
and adopt the consultant's finding. Firm paid a fine of$360,000.
• The Firm settled with the SEC in matters related to violations of MSRB Rules G-23(c), G-17
and SEC rule 15B(c) (1). The Firm disgorged fees of$120,000 received as financial advisor
on the deal,paid prejudgment interest of$22,400.00 and a penalty of$50,000.00.
• The Finn entered into a Settlement Agreement with Rhode Island Coinmerce Corporation.
Under the Settlement Agreement, the fit-in agreed to pay $16.0 trillion to settle any and all
claims in connection with The Rhode Island Economic Development Corporation Job
Creation Guaranty Program Taxable Revenue Bond (38 Studios, LLC Project) Series 2010,
including the litigation thereto. The case, filed in 2012, arose out of a failed loan by Rhode
3
Island Economic Development Corporation.The firm's predecessor company,First Southwest
Company, LLC, was one of 14 defendants. FirstSouthwest's engagement was limited to
advising on the structure, terms, and rating of the underlying bonds. Hilltop settled with no
admission of liability or wrongdoing.
H. How to Access Form MA and Form MA-I Filings. The Firm's most recent Form MA and each
most recent Form MA-I filed with the SEC are available on the SEC's EDGAR system at Forms MA and
MA-1. The SEC permits certain items of information required on Form MA or MA-I to be provided by
reference to such required information already filed by the Firms in its capacity as a broker-dealer on Form
BD or Farm U4 or as an investment adviser on Foran ADV,as applicable.Information provided by the Firm
on Form BD or Form U4 is publicly accessible through reports generated by BrokerCheck at
http://brokercheck.finra.org/,and the Firm's most recent Form ADV is publicly accessible at the Investment
Adviser Public Disclosure website at http://www.adviserinfo.sec.gov/. For purposes of accessing such
BrokerCheck reports or Form ADV, click previous hyperlinks.
PART C—Future Supplemental Disclosures
As required by MSRB Rule G-42, this Municipal Advisor Disclosure Statement may be supplemented or
amended,from time to time as needed,to reflect changed circumstances resulting in new conflicts of interest
or changes in the conflicts of interest described above,or to provide updated information with regard to any
legal or disciplinary events of the Firm. The Firm will provide Client with any such supplement or
amendment as it becomes available throughout the term of the Agreement.
4