2001 12 13 WS MinutesMINUTES OF THE WORK SESSION
OF THE CITY COUNCIL OF THE CITY OF BAYTOWN
December 13, 2001
The City Council of the City of Baytown, Texas, met in work session on December 13,
2001, at 5:35 p.m. in the Hullum Conference Room of Baytown City Hall, 2401 Market
Street, Baytown, Texas, with the following in attendance:
Ronnie Anderson
Council Member
Calvin Mundinger
Council Member
Don Murray
Council Member
Mercedes Renteria III
Council Member
Scott Sheley
Council Member
Pete C. Alfaro Mayor
Absent was: Coleman Godwin Council Member
Monte Mercer City Manager
Ignacio Ramirez, Sr. City Attorney
Gary W. Smith City Clerk
The meeting was opened with a quorum present after which the following business was
conducted:
Discuss authorization of the issuance of Baytown Area Water Authority Contract
Revenue Bonds, Series 2002 (City of Baytown project).
Discuss authorization of the issuance of City of Baytown General Obligation and
Refunding Bonds, Series 2002.
Discuss authorization of the issuance of City of Baytown Marina Improvement
Refunding Bonds, Series 2002A.
Discuss authorization of the issuance of City of Baytown Certificates of Obligation,
Series 2002.
Drew Masterson, First Southwest, reported to City Council on the issues concerning the
four bond sales. The BAWA sale was a competitive sale. Three bids were received and
the low bidder was Prudential Securities with an average interest rate of 5.11 %. The yield
to the buyer ranges from 3.18% in 2004 to 5.3% in 2020. The interest rate is very close to
the lowest rate over the past five years. Standard & Poors upgraded BAWA's bonds from
A- to A. The rating is now the same as the rating from Moody's. This is the result of hard
work from the City Manager, Finance Department and Legal Department. The increased
rating is due to the solid financial position of BAWA.
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Minutes of the Work Session — December 13, 2001
The general obligation and refunding bonds are in the amount of $18,620,000, of which
$7,010,000 is for the capital improvement program. The balance of the sale includes the
refinancing of the 1992 general obligation bonds. $3,020,000 was refunding the Marina
bonds. Certificates of Obligation were issued in the amount of $5,415,000 for the water
and sewer improvements. The refunding bonds lower the interest rate from 6.44% to
4.63 %. This will yield an annual savings of $130,000 over the next eleven years. The
blended general obligation bond rate is 4.82 %. The refunded Marina bonds are subject to
alternative minimum taxation, and bear 4.9 %. The Certificates of Obligation have interest
at 5.15 %. Information relative to other bond issues of the City was made available to the
Council. Mr. Masterson reviewed the rating reports.
Discuss project plan and reinvestment zone financing plan for Reinvestment Zone
Number One, City of Baytown.
Monte Mercer, City Manager, introduced the project plan and financing plan for
Reinvestment Zone Number One. The Reinvestment Zone Board has reviewed the plans
over several meetings and has approved the plans.
The project plan reflects $32,000,000 in nonproject costs, which are not eligible for
reimbursement. The costs involve restaurants, theaters, improvements to San Jacinto Mall,
a hotel, gateway improvements and residential infrastructure. The noneducational project
costs are reimbursable ($42,090,000) and provide for a conference center, plazas,
roadways, gateway improvements, drainage, utility relocations, land, convocation/fine arts
center, residential infrastructure, Fire, Police and EMS facilities, and zone administration
and management. Educational facilities project costs ($18,000,000) are projected, if the
school district is able to participate.
The success of the zone depends on participation of the governmental entities.
Reimbursement depends on the increase in the incremental value of the real property
within the zone. Reimbursement for project costs in each segment of the zone depends on
the creation of incremental taxes in the segment.
If the project plan and financing plans are approved, then the zone board will be able to
approve development contracts, but only in accordance with the plans.
Will Deane, Alliance Retail, responded to inquiries about perceptible improvements in
zone and related that the new theaters at the Mall were built in anticipation of the zone.
Chili's Restaurant will begin construction in the near future. Negotiations are underway
for the start of the monumentation for the zone.
It was noted that the general description of the zone boundaries did not include the
LEGNA property. David Hawes stated that the general language in the description will
include the LEGNA property.
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Minutes of the Work Session— December 13, 2001
op� Implementation of aesthetic changes (landscaping scheme, signage and monumentation,
and development plans) will begin in 2002.
Bonds will not be issued until the value of the zone is in excess of the obligations. Bonds
will not be considered unless there is sound economic reason to issue the bonds.
Will Deane assured the Council that Alliance Retail was committed to the development of
San Jacinto Mall.
Discuss appointments
Electrical Board
Community Development Advisory Committee
Growth Management and Development Advisory Commission and
Planning and Zoning Commission
Baytown Industrial Development Corporation Board
Confirmation of City Manager's appointment to the Civil Service
Commission.
Appointments were not considered due to a lack of time.
Adjourn.
Council Member Mundinger moved adjournment. Council Member Anderson seconded
the motion. The vote follows:
Ayes: Council Members Anderson, Mundinger, Murray, Renteria and Sheley
Mayor Alfaro
Nays: None.
There being no further business the meeting adjourned at 6:28 p.m.
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City Clerk