Loading...
1978 09 14 CC Minutes80914 -1 MINUTES OF THE REGULAR MEETING OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS September 14, 1978 The City Council of the City of Baytown, Texas, met in regular session Thursday, September 14, 1978, at 6:30 p.m. in the Council Chamber of the Baytown City Hall. The following members were in attendance: Jody Lander Jimmy Johnson Ted Kloesel Mary E. Wilbanks Eileen Caffey Allen Cannon Emmett O. Hutto Fritz Lanham Dan Savage Scott Bounds Karen Petru Absent: Eileen P. Hall Councilman Councilman Councilman Councilwoman Councilwoman Councilman Mayor City Manager Assistant City Manager City Attorney Deputy City Clerk City Clerk Mayor Hutto called the meeting to order and the invocation was offered by Reverend Billy Joe Tate of the Central Baptist Church. Approve Minutes Councilwoman Wilbanks moved for approval of the minutes of the regular meeting of August 24, 1978, and the special meeting of August 31, 1978, and ratification of actions taken concerning each of the matters listed on the agendas of said meetings; Councilwoman Caffey seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None Ordinance - Approving a Resolution of the Baytown Area Water Authority Which Authorizes the Issuance of BAWA Water Supply Contract Revenue Bonds (City of Baytown, Texas Project) Series 1978, and Accept Terms and Conditions of Said Resolution Mr. Bob Gillette, President of the Baytown Area Water Authority Board, explained that at a previous bid opening only one bid was received for the sale of these bonds. Therefore, the bond sale was readvertised and bids were opened at 5:00 p.m. Five bids were received for the purchase of $11,850,000 worth of Baytown Area Water Authority Water Supply Contract Revenue Bonds with the effective interest rate ranging from 5.7756% to 6.3025 %. Tom Masterson, of Underwood, Neuhaus, explained that the best bid was received from Donaldson, Lufkin, and Jenrette of New York City at an effective interest rate of 5.77 %. Mr. Masterson explained that this bidding reflects two things: (1) A maturity schedule which has been reduced and shortened by five years from the maturity schedule originally offered, and (2) there has been a good bond market within the last few days. Mr. Masterson was very pleased with the 5. 771,lo interest rate. In response to a question from Councilman Kloesel, Mr. Masterson explained that the time table is to the year 2000 80914 -2 Minutes of the Regular Meeting - September 14, 1978 which is a period of 20 years following the date on which the contract with the City of Houston becomes effective. Councilman Lander inquired about the purpose of the cash premium. Mr. Masterson explained that the premium is the tie - breaker in the event that two bidders should select the same sets of interest rates over the life of the issue. The purpose of the premium is to resolve the tie in such an event. The Administration recommended approval of the ordinance. Councilwoman Wilbanks moved for adoption of the ordinance; Councilman Lander seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2531 AND ATTACHED RESOLUTION & CERTIFICATE AN ORDINANCE APPROVING A RESOLUTION OF THE BAYTOWN AREA WATER AUTHORITY WHICH AUTHORIZES THE ISSUANCE OF " BAYTOWN AREA WATER AUTHORITY WATER SUPPLY CONTRACT REVENUE BONDS (CITY OF BAYTOWN, TEXAS PROJECT) SERIES 1978 "; ACCEPTING THE TERMS AND CONDITIONS OF SUCH RESOLUTION; AND PROVIDING FOR AN EFFECTIVE DATE HEREOF. RESOLUTION AUTHORIZING ISSUANCE OF BAYTOWN AREA WATER AUTHORITY WATER SUPPLY CONTRACT REVENUE BONDS (CITY OF BAYTOWN, TEXAS PROJECT) SERIES 1978 THE STATE OF TEXAS COUNTIES OF HARRIS AND CHAMBERS BAYTOWN AREA WATER AUTHORITY WHEREAS, the Baytown Area Water Authority (hereinafter called the "Authority ") was organized, created, and established pursuant to Chapter 600, Acts of the 63rd Legislature of the State of Texas, Regular Session, 1973 (hereinafter called the "Authority Act ") ; WHEREAS, the Authority has the right, power, and authority to enter into contracts of not exceeding 40 years duration with persons, corporations (public or private), municipal corporations, including the City of Baytown (hereinafter called "Baytown "), political subdivisions of the State of Texas, and others, on such terms and conditions as the Board of Directors of the Authority (hereinafter called the "Board ") may deem desirable, fair, and advantageous for the performance of its rights, powers, and authorities under the Authority Act, including the right, power, and authority to acquire surface and /or underground water supplies from sources both within and without the boundaries of the Authority and to conserve, store, transport, treat, purify, distribute, sell, and deliver water, both surface and underground, to such persons and other parties within the boundaries of the Authority; WHEREAS, the Authority has entered into a "Wholesale Water Supply Contract - Untreated Water," dated as of November 1, 1976, with the City of Houston (hereinafter called "Houston "), for the purchase of quantities of untreated surface water from Houston (hereinafter called the "Houston Contract "); 80914 -3 Minutes of the Regular Meeting - September 14, 1978 WHEREAS, the Authority has also entered into a "Water Supply Contract - Treated Water," dated January 31, 1977, with Baytown for the sale and delivery of treated water to Baytown (hereinafter called the "Baytown Contract "), which was approved at an election within Baytown on January 15, 1977; WHEREAS, on April 21, 1977, the City Council of Baytown, by its Ordinance No. 2211, approved a Resolution Authorizing Issuance of Baytown Area Water Authority Water Supply Contract Revenue Bonds (City of Baytown, Texas Project), Series 1977 (hereinafter called the "1977 Bond Resolution "); and WHEREAS, in accordance with the Baytown Contract, the Authority has duly authorized, sold, and delivered that issue of "Baytown Area Water Authority Water Supply Contract Revenue Bonds (City of Baytown, Texas Project), Series 1977 ", dated May 1, 1977, in the aggregate principal amount of $1,250,000 (hereinafter called the "Series 1977 Bonds ") pursuant to the 1977 Bond Resolution adopted by the Board on April 21, 1977 for the purpose of acquiring funds to make, purchase, construct, lease, or otherwise acquire certain water supply, treatment, and distribution facilities defined as the "Project" in the Baytown Contract (hereinafter sometimes called the "Project "), and the Series.1977 Bonds are the only bonds ever issued by the Authority; WHEREAS, pursuant to law and the 1977 Bond Resolution, the Authority is authorized to issue, upon the request of Baytown, Additional parity bonds in such amounts as are required for the purpose of acquiring funds to (i) complete making, purchasing, constructing, leasing, or acquiring the Project; (ii) enlarge, expand, or modify the Project; (iii) reconstruct the Project; or (iv) refund any bonds, which additional bonds, when issued and delivered, shall be payable from and secured by a first lien on and pledge of the Pledged Revenues (hereinafter defined) (which shall include additional payments sufficient to enable the Authority to comply with all terms and conditions of the 1977 Bond Resolution with respect to the issuance of such additional bonds), in the same manner and to the same extent as any previously outstanding Series 1977 Bonds; and all of the Series 1977 Bonds and any such additional bonds shall in all respects be on a parity and of equal dignity; WHEREAS, Section 13 (b) of the 1977 Bond Resolution provides that no such installment or series of additional bonds shall be issued unless: (i) A certificate is executed by the President and Secretary of the Board to the effect that no default exists in connection with any covenants or requirements of any outstanding Series 1977 Bonds, and that the Debt Service Fund contains the amount then required to be on deposit therein; (ii) Baytown is not in default with respect to any series of bonds or other debt issued by it; and (iii) The principal of and installment or series of Additional Bonds are payable on the same semiannual interest dates and annual principal dates as the Outstanding Bonds, and such requirements can be met; WHEREAS, it is necessary to issue additional bonds at this time to complete the making, purchasing, constructing, leasing, or acquiring the Project; 80914 -4 Minutes of the Regular Meeting - September 14, 1978 WHEREAS, on , the City Council of Baytown, by its Ordinance No. approved the issuance of The bonds authorized to be issued hereby (hereinafter defined as the "Series 1978 Bonds ") and the terms and conditions of this Resolution (hereinafter called the "Resolution "); WHEREAS, this preamble shall constitute an integral part of this Resolution; and WHEREAS, the Board, having taken all action necessary to be done prior to the issuance of the Series 1978 Bonds, now deems it necessary and advisable to do so. IT IS, THEREFORE, RESOLVED BY THE BOARD OF DIRECTORS OF THE BAYTOWN AREA WATER AUTHORITY THAT: Section 1. Designation, Amount, and Purpose of the Bonds. The Authority's negotiable bonds are hereby authorized to be issued in the aggregate principal amount of Eleven Million Eight Hundred Fifty Thousand Dollars ($11,850,000) to be called "Baytown Area Water Authority Supply Contract Revenue Bonds (City of Baytown, Texas Project) Series 1978" (hereinafter called the "Series 1978 Bonds ") for the purpose of acquiring funds to complete making, purchasing, constructing, leasing, or acquiring water supply, treatment, and distribution facilities defined as the "Project" in the Baytown Contract. Section 2. Date, Denomination, Numbers, and Maturities of the Series 1978 Bonds. The Series 1978 Bonds shall be dated September 1, 1978, shall be in the denomination of $5,000 each, shall be numbered consecutively from one upward, and shall mature serially on the first day of May in each of the years and in the amounts, respectively, as set forth in the following schedule, unless theretofore called for redemption as provided in this Resolution: Years of Maturity Annual Principal Amounts Years of Annual Principal Maturity Amounts 1981 $125,000 1991 $500,000 1982 125,000 1992 675,000 1983 150,000 1993 750,000 1984 150,000 1994 825,000 1985 175,000 1995 900,000 1986 225,000 1996 975,000 1987 275,000 1997 1,050,000 1988 350,000 1998 1,150,000 1989 400,000 1999 1,250,000 1990 450,000 2000 1,350,000 Section 3. Interest on the Series 1978 Bonds. The Series 1978 Bonds shall bear interest from the date thereof to their scheduled maturities or redemption at the rates of interest, as set forth in the following schedule, payable on May 1, 1979, and semiannually thereafter on November 1 and May 1 of each year while the Series 1978 Bonds are outstanding: Years of Interest Years of Interest Maturity Rates Maturity Rates 1981 1991 1982 1992 1983 1993 1984 1994 1985 1995 1986 1996 1987 1997 1988 1998 1989 1999 1990 2000 N la 80914 -5 Minutes on the Regular Meeting - September 14, 1978 Such interest shall be evidenced by interest coupons which shall initially appertain to the Series 1978 Bonds and shall be payable in the manner provided in the FORM OF SERIES 1978 BOND set forth in Section 5 hereof. Section 4. General Characteristics and Execution of the Series 1978 Bonds. The Series 1978 Bonds and the interest coupons appertaining thereto shall be issued, shall be payable, may be redeemed prior to their scheduled maturities, shall have the characteristics, and shall be signed, executed, (and the Series 1978 Bonds shall be sealed), all as provided and in the manner indicated in the FORM OF SERIES 1978 BOND set forth in Section 5 hereof. In case any officer of the Authority whose facsimile signature shall nevertheless be as valid and sufficient for all purposes as if such offices had remained in office until delivery of such Series 1978 Bonds. Section 5. Form of the Series 1978 Bonds. The Form of the Series 1978 Bonds, including the form of Registration Certificate of the Comptroller of Public Accounts of the State of Texas to be printed and endorsed on each of the Series 1978 Bonds and the form of the interest coupons which shall appertain and be initially attached to each of the Series 1978 Bonds shall be, respectively, substantially as follows, with necessary and appropriate variations, omissions, and insertions as permitted or required by this Resolution: NO. FORM OF THE SERIES 1978 BOND: $5,000 United States of America State of Texas BAYTOWN AREA WATER AUTHORITY WATER SUPPLY CONTRACT REVENUE BOND (CITY OF BAYTOWN, TEXAS PROJECT) SERIES 1978 ON May 1, , the BAYTOWN AREA WATER AUTHORITY (the "Authority "), for value received, hereby promises to pay to the bearer hereof the principal amount of FIVE THOUSAND DOLLARS and to pay interest thereon, from the date hereof to maturity or redemption, at the rate of % per annum, evidenced by interest coupons payable on May 1, 1979, and semiannually thereafter on November 1 and May 1 of each year while this Bond is outstanding; provided, however, that such principal and interest are payable solely from the sources and in the manner herein provided, and from no other source. THE PRINCIPAL of this Bond and the interest coupons appertaining hereto shall be payable to the bearer, in lawful money of the United States of America, without exchange or collection charges to the bearer, upon presentation and surrender of this Bond or proper interest coupon, as the case may be, at the following, which shall be the Paying Agent (the "Paying Agent ") for this series of Bonds: CITIZENS BANK & TRUST CO. OF BAYTOWN BAYTOWN, TEXAS The Authority may at any time or from time to time, with the approval of the City of Baytown, Texas ( "Baytown "), appoint one or more other Paying Agents for the Bonds (hereinafter defined) in the manner and subject to the conditions set forth in the Resolution (hereinafter defined). Minutes of the Regular Meeting - September 14, 1978 THIS BOND is one of a series of Bonds dated as of September 1, 1978 (the 'Bonds "), authorized and issued in the aggregate principal amount of $11,850,000 for the purpose of acquiring funds to complete making, purchasing, constructing, leasing, or acquiring certain water supply, treatment, and distribution facilities defined as the "Project" in the Water Supply Contract - Treated Water, dated January 31, 1977 (the "Contract "), between the Authority and Baytown and approved at an election within Baytown on January 15, 1977. THE BONDS are additional parity revenue bonds as defined and permitted in the resolution adopted by the Board of Directors of the Authority on April 21, 1977 (the "1977 Bond Resolution "), authorizing the issuance of that issue of "Baytown Area Water Authority Water Supply Contract Revenue Bonds (City of Baytown, Texas Project), Series 197711, dated April 1, 1977, in the original principal amount of $1,250,000 (the "Series 1977 Bonds "). IN THE CONTRACT and pursuant to Ordinance No. 78- of the City Council of Baytown, in which Baytown approved the issuance of the Bonds and the terms and conditions of the resolution of the Board of Directors of the Authority ( "the Board "), dated authorizing the issuance of the Bonds (the "Resolution "), Baytown has agreed and is unconditionally obligated to make payments of Pledged Revenues into the "Baytown Area Water Authority Water Supply Contract Revenue Bonds (City of Baytown, Texas Project) Series 1978 - Debt Service Fund: (the "Debt Service Fund ") kept by the Paying Agent, all as defined in the Resolution, in addition to and on a parity with payments to be made with respect to the Series 1977 Bonds. The principal of and interest on this Bond, and other Bonds of the series of which it is a part (equally, ratibly, and in all manner on a parity with the Series 1977 Bonds), are payable solely from, and secured by a first lien on and pledge of, the payments of Pledged Revenues or, in certain instances as described in the Resolution, from amounts attributable to the proceeds of the Bonds, as hereinafter described. Pursuant to the Contract, Pledged Revenues include the payments for treated water to be made by Baytown to the Paying Agent for deposit into the Debt Service Fund and pledged in the Resolution for payment of the principal and interest on the Bonds issued pursuant to the terms of the Contract, the source of which shall include any and all available sources that Baytown may pledge toward such payments, including gross revenues of its waterworks and sanitary sewer system. THE HOLDER HEREOF shall never have the right to demand payment of this obligation from monies derived or to be derived by taxation or any other revenues of the Authority other than the Pledged Revenues as described in this Bond or, in certain instances as described in the Resolution, from amounts attributable to proceeds of the Bonds. Except for the lien on and the assignment and pledge of the Pledged Revenues, neither the Project not any other property of Baytown or of the Authority is encumbered by any lien for the benefit of the holder of this Bond. The Bonds of this series are special obligations payable as aforesaid and shall not be considered as general obligations of the governing body of the Authority, the Authority, the State of Texas, or any municipalities or subdivisions thereof. No entity other than the Authority is obligated, directly, indirectly, or contingently, to pay the Bonds of this series from any other source whatsoever. ON NOVEMBER 1, 1993, or on any interest payment date thereafter, any outstanding Bonds of this series may be redeemed prior to their scheduled maturities, in whole or in part, as instructed by Baytown, upon written notice of the 80914 -7 Minutes of the Regular Meeting - September 14, 1978 exercise of the option to redeem delivered by Baytown to the Authority and the Paying Agent, for a price equal to the principal amount of the Bonds to be redeemed plus unpaid accrued interest to the date fixed for redemption. The Paying Agent shall cause a written notice of any redemption to be published at least once during each week for at least two consecutive weeks, each publication to be made in a newspaper or general circulation in Houston, Texas, with the first of such publications being at least 30 days prior to the date fixed for redemption. If, because of temporary or permanent suspension of the publication or general circulation of any such newspapers, it is impossible or impractical to publish such notice in the manner provided herein, then such publication in lieu thereof a:3 shall be made with the approval of the Paying Agent shall constitute a sufficient publi- cation of a notice. By the date fixed for any such redemption, due provision shall be made with the Paying Agent for the payment of the principal amount of the Bonds which are to be redeemed, plus accrued interest thereon to the date fixed for redemption. If such written notice of redemption is published, the Bonds called for redemption shall become due and payable on the date fixed for redemption, and, if due provision for such payment is made, all as provided above, the Bonds which are to be redeemed thereby shall automatically be deemed to have been redeemed prior to their scheduled maturities; shall not bear interest after the date fixed for redemption; and shall not be regarded as being outstanding except for the right of the bearer to receive the funds provided for such payment. Upon presentation and surrender of such Bonds to the Paying Agent, together with all coupons appertaining thereto maturing after such redemption date, such Bonds shall be paid. IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday, a Sunday, a legal holiday, or a day on which banking institutions in the city where the bank of the Paying Agent is located are authorized by law or executive order to close and on which the bank of the Paying Agent is closed, then the date for such payment shall be the next succeeding day which is not such a day; payment on such date shall have the same force and effect as if made on the original date of payment; and no interest shall accrue from the original date of payment to such date. THIS BOND shall be exchangeable or transferable by delivery. The principal of this Bond shall be payable upon presentation and surrender of the Bond to the Paying Agent. The bearer of this Bond and the bearer of any coupon hereunto appertaining may be deemed and regarded by the Paying Agent as the absolute owner for all purposes, including payment and discharge of liability upon such Bond or coupon to the extent of such payment, and the Paying Agent shall not be affected by notice to the contrary. This Bond and the interest coupons appertaining hereto shall at all times be negotiable instruments within the meaning of the Texas Uniform Commercial Code, as amended. IT IS HEREBY certified and covenanted that this Bond has been duly and validly authorized, issued, and delivered; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond have been performed, existed, and have been done in accordance with law; and that this Bond is a special revenue obligation of the Authority, with the principal and interest on this Bond being payable solely from, and secured by a lien on and pledge or, the payments of Pledged Revenues to be made by Baytown or, in certain instances as described in the Resolution, from amounts attributable to the proceeds of the Bonds. THE AUTHORITY has reserved the right, subject to the restrictions stated in the Resolution, to issue additional 80914 -8 Minutes of the Regular Meeting - September 14, 1978 parity revenue bonds ( "Additional Bonds ") which also may be made payable from, and be secured, equally and ratibly with the outstanding Series 1977 Bonds and the Bonds, by a lien on and pledge of the Pledged Revenues, all in accordance with the terms of the Resolution, as the same may be amended as provided therein, to acquire funds (a) to complete making, purchasing, constructing, leasing, or acquiring the Project, (b) to enlarge, expand, or modify the Project, (c) to reconstruct the Project, or (d) to refund any of the Series 1977 Bonds, the Bonds, or any Additional Bonds. Such Additional Bonds may be issued in one or more series, in various principal amounts, to mature at different times, to bear interest at different rates, to be payable in such installments, to be redeemable prior to maturity on whatever terms or prices, and to contain other provisions as may be provided in any resolution or resolutions of the Board whereunder such Additional Bonds may be issued. THE AUTHORITY has also reserved the right to amend the Resolution with the prior written consent of Baytown and with the approval in certain circumstances of the holders of two - thirds (2/3) in aggregate principal amount of the outstanding bonds who are materially adversely affected by such amendment; provided, however, that, without the consent of the holder of each outstanding bond affected thereby, the Resolution shall not be amended so as to permit: (a) the reduction of the portion of bonds the consent of the holders of which is required for any waiver, modification, or alteration; (b) the extension of the time or times of payment of the principal of and interest on the bonds, or the reduction in the principal amount thereof or in the rate of interest thereon or any other modification in the terms of payment of the principal of or interest on the bonds; (c) the creation by the Authority of any lien ranking prior to or on a parity with the lien of the Bonds (other that with respect to Additional Bonds); .(d) the giving of any preference of any bond over any other bond; or (e) the extension of any waiver of default to subsequent defaults. IN WITNESS WHEREOF, this bond and the interest coupons appertaining hereto have been signed with the facsimile signature of the President of the Board, and countersigned with the facsimile signature of the Secretary of the Board, and the official seal of the Authority has been duly impressed, or placed in facsimile, on this Bond. Secretary, Board of Directors President, Board of Directors (AUTHORITY'S SEAL) FORM OF COMPTROLLER'S REGISTRATION CERTIFICATE: OFFICE OF THE COMPTROLLER OF PUBLIC REGISTER NO. ACCOUNTS OF THE STATE OF TEXAS I HEREBY CERTIFY THAT there is on file and of record in my office a certificate to the effect that this Bond has been examined, certified as to validity, and approved by,the Attorney General of the State of Texas, and further that this Bond has been registered by the Comptroller of Public Accounts of the State of Texas. WITNESS my signature and seal this (COMPTROLLER'S SEAL) Comptroller of Public Accounts of the State of Texas NO. Minutes of the Regular Meeting - September 14, 1978 FORM OF INTEREST COUPON: ON , BAYTOWN AREA WATER AUTHORITY 80914 -9 promises to pay to the bearer, but solely from the sources described in the Bond to which this interest coupon appertains, the amount shown on this interest coupon, in lawful money of the United States of America (without exchange or collection charges to the bearer), unless due provision has been made for the redemption prior to the scheduled maturity of the Bond to which this interest coupon appertains, upon presentation and surrender of this interest coupon at CITIZENS NATIONAL BANK & TRUST CO. OF BAYTOWN, BAYTOWN, TEXAS, such amount being interest coming due on such day in respect of the Bond bearing the number hereinafter designated of that issue styled BAYTOWN AREA WATER AUTHORITY WATER SUPPLY CONTRACT REVENUE BONDS (CITY OF BAYTOWN, TEXAS PROJECT) SERIES 1978 dated September 1, 1978. The holder hereof shall never have the right to demand payment of this obligation out of any money derived or to be derived by taxation or any other revenues of the Authority other than the sources described in the Bond to which this coupon appertains. Bond No. Secretary, Board of Directors President, Board of Directors Section 6. Definitions. In addition to the other terms and phrases defined herein, the following terms shall have the following meanings: Bonds -- Bonds issued by the Authority, including the Series 1977 Bonds, the Series 1978 Bonds, and Additional Bonds, as described in Section 13, (1) which, together with the interest thereon, are to be paid from the payments of Pledged Revenues and (2) which have been issued and sold to acquire funds to (a) make, purchase, construct, lease, or otherwise acquire the Project, (b) complete such making, purchasing, constructing, leasing, or acquiring, (c) enlarge, expand, or modify the Project, (d) reconstruct the Project, or (e) refund any Bonds. Bondholder -- The holder of any Bond and, when used with respect to any coupon, the holder thereof. Costs of the Project -- The costs incurred or to be incurred by the Authority or Baytown with respect to the acquisition of the Project, whether incurred prior to or after the date of the Baytown Contract and including, but not limited to, the following items: (1) Obligations for labor, materials, services, and equipment; (2) Costs of any bonds and insurance the cost of which is not otherwise provided for; (3) Costs of engineering services, including costs for preliminary design and development work, test borings, surveys, estimates, plans and specifications, supervising construction, and performing all other duties required by or consequent upon proper construction; 80914 -10 Minutes of the Regular Meeting - September 14, 1978 (4) Expenses incurred in connection with the issuance and sale of the Bonds, including without limitation (a) fees and expenses of accountants, auditors, attorneys, underwriters, engineers, and financial advisors, (b) material, supplies, printing, and engraving, (c) recording and filing fees, (d) rating agency fees, and (e) initial fees and expenses of a trustee, if any; (5) Costs required to be paid under the terms of any contract or contracts in connection with the Project; (6) Sums required to reimburse the Authority or Baytown for advances made by either of them for any of the above items, including fees of any kind for any other cost incurred, including expenses for organization of the Authority, overhead expenses, and expenses for any work done by either the Authority or Baytown which are properly chargeable to the Project; and (7) Costs of all other items related to the acquisition of the Project. Houston Contract -- The Wholesale Water Supply Contract - Untreated Water, dated as of November 1, 1976, between the Authority, as buyer, and the City of Houston, Texas, as seller. Outstanding Bonds -- At any date as of which the amount of Outstanding Bonds is to be determined, the aggregate of all Bonds, except the following: (1) Bonds cancelled or delivered to the Paying Agent for cancellation at or prior to such date; (2) Bonds for the full payment of the principal of and interest on which cash shall have been theretofore deposited with the Paying Agent and which (a) shall have matured by their terms, or otherwise shall have become payable, but shall not have been rendered for payment or (b) shall have been purchased by the Authority but shall not have been presented for payment; and (3) Bonds in exchange for or in lieu of which other Bonds have been delivered under this Resolution. Paying Agent -- Any person named herein or in accordance herewith to pay the principal of and interest on any of the Bonds, one of which shall be Citizens Bank & Trust Co. of Baytown, Baytown, Texas, and any successor Paying Agent. Pledged Revenues -- The payments to be made by Baytown to the Authority for treated water and pledged herein for payment of the principal and interest on the Bonds issued pursuant to the terms of the Baytown Contract, the source of which shall include any and all available sources that Baytown may pledge toward such payments, including gross revenues of its waterworks and sanitary sewer system. Project -- The property, works, facilities, and improvements (whether previously existing or to be made, constructed, or acquired), within or without the 80914 -11 Minutes of the Regular Meeting - September 14, 1978 boundaries of the Authority, necessary (1) to acquire surface water supplies from sources both within and without the boundaries of the Authority, including particularly the sources provided by the Houston Contract; (2) to conserve, store, transport, treat, and purify untreated water purchased by the Authority pursuant to the Houston Contract; and (3) to distribute, sell, and deliver treated water to Baytown pursuant to the terms of the Baytown Contract. The Project will consist of (1) property, works, facilities and improvements to accept untreated water at a point of delivery pursuant to the Houston Contract; (2) pipelines and canals; (3) a reservoir and /or forebay between such point of delivery and the Authority's treatment facilities; and (4) certain water treatment facilities as may be revised pursuant to the Baytown Contract. Section 7. Pledge; S ecial Obligations. (a) The Series 1978 Bonds--a-n-T the interest coupons appertaining thereto shall be payable from, and secured by an irrevocable first lien on and pledge of, the Pledged Revenues or, in certain instances as described in Section 8, from amounts attributable to the proceeds of the Series 1978 Bonds. The Pledged Revenues are further pledged irrevocably to the establishment and maintenance of the Debt Service Fund (hereinafter defined) at the Paying Agent. (b) The Series 1978 Bonds and the interest coupons appertaining thereto shall be special obligations of the Authority payable solely from the sources described above, and no holder of any Series 1978 Bonds shall ever have the right to demand payment of the Series 1978 Bonds and interest coupons from funds derived or to be derived by taxation or any revenues of the Authority other than those pledged in the preceding subsection. The Series 1978 Bonds shall not be considered general obligations of the governing body of the Authority, the Authority, the State of Texas, or any municipality or subdivision thereof. No entity other than the Authority is obligated, directly, indirectly, or contingently to pay the Series 1978 Bonds from any other source whatsoever. Section 8. Project Fund; Investment Thereof. (a) Immediately after the sale and delivery of the Series 1978 Bonds, the Authority shall deposit into a separate and special "Baytown Area Water Authority Stater Supply Contract Revenue Bonds (City of Baytown, Texas Project) Series 1978 - Project Fund" (the "Project Fund "), which is hereby created and shall be established at one of the Authority's official depositories, an amount equal to the principal amount of the Series 1978 Bonds less underwriter's discount, if any. The Project Fund shall be established, drawn on, and used by the Authority to pay the eligible Costs of the Project. (b) Any monies held as part of the Project Fund shall, at the direction of Baytown, be invested and reinvested pursuant to the Authority Act and in accordance with the laws of the State of Texas, subject to the provisions of Section 17 hereof. All interest and realized profit from such investment may be transferred to and deposited in the Debt Service Fund (hereinafter defined) if so directed by the Authority. All losses resulting from such investment will be charged against the Project Fund. Any obligation in which such money is so invested shall be kept and held safely and shall be sold and the proceeds of the sale applied so as to make promptly all payments required to be made. (c) After completion of the Project, any surplus monies remaining in the Project Fund (other than funds required to provide for the payment of the Costs of the Project not then due and payable or the liability for the 80914 -12 Minutes of the Regular Meeting - September 14, 1978 payment of which is being contested or disputed) shall, at such time or as soon thereafter as possible, be deposited in the Debt Service Fund (hereinafter defined). Any monies retained in the Project Fund by the Authority for the payment of Costs of the Project not then due and payable, or the liability for the payment of which is being contested or disputed and which shall thereafter become available, shall be applied in accordance with the provisions of the preceding sentence. Section 9. Debt Service Fund; Investment Thereof.(a) Immediately after the sale and delivery of the Series 1978 Bonds, the Authority shall deposit into a separate and special trust fund called the "Baytown Area Water Authority Water Supply Contract Revenue Bonds (City of Baytown, Texas Project) Series 1978 - Debt Service Fund" (the "Debt Service Fund "), which is hereby created and shall be established by the Authority at the Paying Agent and maintained as provided in this Resolution so long as any Series 1978 Bond or interest coupon appertaining thereto is outstanding and unpaid, the accrued interest, if any, on the Series 1978 Bonds to the date of delivery. All payments by Baytown of Pledged Revenues with respect to each series of Outstanding Bonds shall be deposited directly into the appropriate Debt Service Fund, without priority or preference. (b) All monies from time to time deposited and held in the Debt Service Fund shall be held in trust by the Paying Agent for the benefit of the Bondholders entitled to be paid therefrom. From the monies in the Debt Service Fund the Authority shall pay, or cause to be paid, the interest on the Series 1978 Bonds as the same shall become due and the principal of the Series 1978 Bonds as the same shall mature or be called for redemption. (c) If the date for the payment of the principal of or interest on a Series 1978 Bond is a Saturday, a Sunday, a legal holiday, or a day on which banking institutions in the city where the bank of the Paying Agent is located are authorized by law or executive order to close and on which the bank of the Paying Agent is closed, then the date for such payment shall be the next succeeding day which is not such a day; payment on such date shall have the same force and effect as if made on the original date or payment; and no interest shall accrue from the original date of payment to such date. (d) (i) Any monies held as part of the Debt Service shall, at the direction of Baytown, be invested or reinvested by the Paying Agent pursuant to the Authority Act and in accordance with the laws of the State of Texas and subject to the provisions of Section 17 hereof. (ii) Any securities purchased with the monies in the Debt Service Fund shall be deemed a part of the Debt Service Fund. The income and profits, including realized discount on securites purchased, received on all such securities (after deduction for accrued interest and premium paid from the Debt Service Fund at time of purchase) shall be deposited in or credited to the Debt Service Fund, and all losses thereon shall be charged against the Debt Service Fund. Neither the Authority nor the Paying Agent shall be liable or responsible for any loss resulting from any such investment or resulting from any such investment or resulting from the redemption or sale of any such investment as herein authorized. If at any time it shall become necessary that some or all of the securities purchased with the monies in the Debt Service Fund be redeemed or sold to raise monies necessary to comply with the provisions of this Resolution, the Paying Agent shall, at the direction of Baytown, effect such redemption or sale. 80914 -13 Minutes of the Regular Meeting - September 14, 1978 Section 10. Security of Funds. All moneys deposited with the Authority or the Paying Agent and not invested in securities by the Authority or the Paying Agent pursuant to the provisions hereof or insured by the Federal Deposit Insurance Corporation or other federal agency, shall continuously be secured, for the benefit of the Bondholders, as required by law for the security of the Authority's funds. Section 11. Baytown's Payments of Pledged Revenues. (a) Baytown has agreed in the Baytown Contract, and, in addition to and on a parity with payments agreed to be made pursuant to the approval of the 1977 Bond Resolution, by approving the issuance of the series 1978 Bonds and the terms and conditions of this Resolution, Baytown has further absolutely and unconditionally obligated itself and agreed (regardless of, and notwithstanding, any provisions of any other contract or agreement between Baytown and the Authority or any other party to the contrary) to make the following payments to the Authority in immediately available funds: (i) On or before November 1, 1978 and the first day of each month thereafter, such amount, in approximately equal monthly installments, as will be sufficient, together with any other amounts available therefor in the Debt Service Fund, as shall in the aggregate equal (A) the interest which shall become due on the Series 1978 Bonds on the next succeeding interest payment date, plus (B) the principal amount of any of the 1978 Series 1978 Bonds to be redeemed prior to maturity on such date; and (ii) On or before the first of the month twelve months prior to the first maturity of the Series 1978 Bonds, and the first day of each month thereafter, such amounts, in approximately equal monthly installments, as will be sufficient, together with any other amounts available therefor in the Debt Service Service Fund, as shall in the aggregate equal the principal amount of the Series 1978 Bonds which shall mature on the next maturity date of the Series 1978 Bonds. (b) The holders of the Series 1978 Bonds shall be entitled to rely unconditionally on the agreements, covenants, and representations set forth in this Resolution. It is further understood and agreed that Baytown may prepay all or any part of each payment of Pledged Revenues, and any such prepayment and any earnings thereon shall be applied by the Authority to Baytown's obligation to make succeeding payments of Pledged Revenues (except such amounts as may be specified by Baytown to be applied to the purchase or redemption of any of the Series 1978 Bonds prior to their maturities); provided, however, that the redemption of any Outstanding Bonds prior to maturity at any time, pursuant to the provisions of this Section, Section 11(b) of the 1977 Bond Resolution, or any similar section in any resolution authorizing any Additional Bonds, with funds from any source (whether from Pledged Revenues or otherwise), shall not relieve Baytown of its unconditional obligation to pay each payment of Pledged Revenues, as specified above, when due. Section 12. Redemption of the Series 1978 Bonds Before Maturity. (a) Redemption dates and prices. (ii) The Series 1978 Bonds are noncallable for redemption prior to November 1, 1993. (ii) On November 1, 1993, or on any interest payment date thereafter, any Outstanding Series 1978 Bonds are subject to optional redemption prior to their scheduled 80914 -14 Minutes of the Regular Meeting - September 14, 1978 maturities, in whole or in part, at the option of and as directed by Baytown, upon written notice of the exercise of the option to redeem delivered by Baytown to the Authority and the Paying Agent. On or before the day fixed for such redemption, Baytown shall deposit, or cause to be deposited, Pledged Revenues into the Debt Service Fund, in immediately available funds, a sum, which, together with other monies available therefor in the Debt Service Fund, is equal to the aggregate principal amount of the Series 1978 Bonds requested to be redeemed plus accrued interest to the date of redemption. (b) Notice of Redemption. The Paying Agent shall cause a written notice of any redemtpion to be published at least once during each week for at least two consecutive weeks, each publication to be made in a newspaper of general publication in Houston, Texas, with the first of such publications being at least 30 days prior to the day fixed for redemption. If, because of temporary or permanent suspension of the publication or general circulation of any such newspapers, it is impossible or impractical to publish such notice in the manner provided herein, then such publication in lieu thereof as shall be made with the with the approval of the Paying Agent for the payment of the principal amount of the Series 1978 Bonds which are to be redeemed, plus accrued interest thereon to the date fixed for redemption. If such written notice of redemption is published, the Series 1978 Bonds called for redemption shall become due and payable on the date fixed for redemption, and, if due provision for such payment is made, all as provided above, the Series 1978 Bonds which are to be redeemed thereby shall automatically be deemed to have been redeemed prior to their scheduled maturities; shall not bear interest after the date fixed for redemption; and shall not be regarded as being Outstanding Bonds except for the right of the bearer to receive the funds provided for such payment. Upon presentation and surrender of such bearer Series 1978 Bonds to the Paying Agent, together with all coupons appertaining thereto maturing after such redemption date, such Series 1978 Bonds shall be paid. (c) Redemption Requests. In the event Baytown exercises its option under Section 12 (a)(ii), redemption shall be made pursuant to such Section at such times and in such principal amounts as Baytown shall, not later than 45 days prior to the date in which any Series 1978 Bonds are to be redeemed pursuant to Section 12 (a)(ii), state in a written certificate which is signed by a duly authorized representative of Baytown and received by the Authority. The Authority shall give the notice of redemption referred to in Section 12(b) in respect of such redemption. Section 13. Additional Bonds. (a) The Authority reserves the right, upon the request of Baytown, to issue additional bonds (the "Additional Bonds ") in such amounts as are required for the purpose of acquiring funds to (i) complete making, purchasing, constructing, leasing, or acquiring the Project, (ii) enlarge, expand, or modify the Project, (iii) reconstruct the Project, or (iv) refund any Bonds. The Additional Bonds, when issued and delivered, shall be payable from and secured by a first lien on and pledge of the Pledged Revenues (which shall include additional payments sufficient to enable the Authority to comply with all terms and conditions of this Resolution with respect to the issuance of such Additional Bonds), in the same manner and to the same extent as any previously Outstanding Bonds; and all of the Bonds shall in all respects be on a parity and of equal dignity. The Additional Bonds may be issued in one or more series, in various principal amounts, to mature at different times, to bear interest at different rates, to be payable in such installments, to be redeemable prior to maturity on whatever terms or prices, and to contain such 80914 -15 Minutes of the Regular Meeting - September 14, 1978 other provisions as may be provided in any resolution or resolutions of the Board whereunder the Additional Bonds may be issued. (b) No such installment or series of Additional Bonds shall be issued unless: (i) A certificate is executed by the President and Secretary of the Board to the effect that no default exists in connection with any covenants or requirements of any Outstanding Bonds and that the Debt Service Fund contains the amount then required to be on deposit therein; (ii) Baytown is not in default with respect to any series of bonds or other debt issued by it; and (iii) The principal of and interest on any such installment or series of Additional Bonds are payable on the same semiannual interest dates and annual principal dates as the Outstanding Bonds. (c) Nothing in this Section shall either require or preclude that (i) any bonds which may be issued by the Authority or any other issuer for the purpose of acquiring funds to (A) make, purchase, construct, lease, or otherwise acquire the Project; (B) complete such making, purchasing, constructing, leasing, or acquiring; (C) enlarge, expand, or modify the Project; (D) reconstruct the Project; or (E) refund any Bonds; (ii) the Bonds must rank equally and on a parity with any such bonds not issued as Additional Bonds; or (iii) that the Bonds must be secured, together with any bonds not issued as Additional Bonds, by a pledge of the Pledged Revenues. Section 14. Amendments and Supplemental Resolutions. (a) The Authority may at any time, subject to the conditions and restrictions contained in this Resolution and with the prior written consent of Baytown, but without the consent of, or notice to, the Bondholders, enter into a resolution or resolutions supplemental hereto, which thereafter shall form a part hereof, for any one or more of the following purposes: (i) To add to the covenants and agreements of the Authority contained in this Resolution other covenants and agreements thereafter to be observed and performed; (ii) To cure any ambiguity or to cure, correct, or supplement any defect, omission, or inconsistent provision contained in this Resolution or in any supplemental resolution; (iii) To establish the amount, terms, provisions, and conditions or a particular series of Additional Bonds and to prescribe the form of such bonds and the coupons appertaining thereto; or (iv) To make any other change in this Resolution or any supplemental resolution which, in the judgement of the Authority in reliance upon an opinion of counsel of recognized national standing in the field of municipal bond law, does not materially adversely affect the rights of the Bondholders of any series. The Authority hereby covenants that it will perform all the requirements of any such supplemental resolutions which may be in effect from time to time. (b) (i) If at any time the Authority shall desire to amend this Resolution, the 1977 Bond Resolution, or the 80914 -16 Minutes of the Regular Meeting - September 14, 1978 Baytown Contract, and such amendment, in the judgement of the Authority in reliance upon an opinion of counsel of recognized national standing in the field of municipal bond law, materially adversely affects the right of the Bondholders, the Authority shall cause notice of the proposed amendment to be published at least once during each week for at least two consecutive weeks, each publication to be made in a newspaper of general circulation in Houston, Texas. Such notice shall briefly set forth the nature of the proposed amendment and shall state that a copy thereof is on file at the principal office of the Authority for inspection by all Bondholders. (ii) From time to time the Bondholders of not less than two - thirds (2/3) in principal amount of the Outstanding Bonds materially adversely affected by any waiver, modification, or alteration of this Resolution, the 1977 Bond Resolution, or the Baytown Contract, may, by an instrument or instruments in writing signed by such Bondholders and filed with the Authority, assent to and authorize any such waiver, modification, or alteration of this Resolution, the 1977 Bond Resolution, or the Baytown Contract that shall be proposed by the Authority and consented to by Baytown; and any action therein authorized to be taken, with the assent or authority given as aforesaid, shall be binding upon all Bondholders affected thereby, no such waiver, modification, or alteration shall permit: (a) the reduction of the portion of the Bonds the consent of the Bondholders of which is required for any waiver, modification, or alteration; (b) the extension of the time or times of payment of the prinicpal of and interest on the Bonds, or the reduction in the principal amount thereof or in the rate of interest thereon or any other modification in the terms of payment of the principal or interest on the Bonds; (c) the creation by the Authority of any lien ranking on a parity with (other than with respect to Additional Bonds); (d) the giving of any preference of any Bond over any other Bond; or (e) the extension of any waiver of default to subsequent defaults. (c) Upon the adoption of any waiver, modification, or alteration pursuant to the provisions of this Section, this Resolution, the 1977 Bond Resolution, or the Baytown Contract, as the case may be, shall be deemed to be amended in accordance therewith and the respective rights, duties, and obligations of the Authority, Baytown, and all the Bondholders of the then Outstanding Bonds shall thereafter be determined, exercised, and endorsed hereunder, subject in all respects to such amendment. Section 15. Sale and Delivery of the Series 1978 Bonds; Approval and Registration Thereof. (a) The sale of the Series 1978 Bonds to (the "Initial Purchaser ") pursuant to the taking of public bids therefor on the date of this Resolution, at a price of and accrued interest to the date of delivery, is hereby confirmed. Delivery of the Series 1978 Bonds to the Initial Purchaser shall be made as soon as practical after the adoption of this Resolution, upon payment therefor, in accordance with the terms of sale. (b) Before the delivery of any Series 1978 Bonds, all necessary records and proceedings pertaining to such Series 1978 Bonds shall be delivered to the Attorney General of Texas for investigation, examination, and approval and to the Comptroller of Public Accounts (or a deputy designated in writing to act for such Comptroller) shall manually sign the Comptroller's Registration Certificate prescribed herein to be printed and endorsed on each Series 1978 Bond, and the seal of such Comptroller shall be impressed, printed, or lithographed on each of the Series 1978 Bonds. Thereafter the Series 1978 Bonds shall be delivered to the initial 80914 -17 Minutes of the Regular Meeting - September 14, 1978 purchasers thereof in accordance with the terms of sale of such Series 1978 Bonds. Section 16. Damaged, Mutilated, Lost, Stolen, or Destroyed Bonds and Coupons. (a) In the event any Bond is damaged, mutilated, lost, stolen, or destroyed, the Authority shall execute a new Bond of the same principal amount and maturity with coupons corresponding in all respects to those unpaid coupons, if any, of the damaged, mutilated, lost, stolen, or destroyed Bond, in exchange for or in lieu of, such Bond and its coupons, if any, submit such replacement Bond to the Attorney General of Texas for his approval and otherwise cooperate with the Bondholder of any such Bond in complying with the provisions of Article 715a, Vernon's Texas Civil Statutes, as amended, or any other statute or procedure available for the issuance of replacement bonds. (b) In the event any coupon appertaining to any Bond is damaged, mutilated, lost, stolen, or destroyed, the Authority shall execute and deliver a new Bond of the same principal amount and maturity and having attached coupons corresponding to the coupons appertaining to the Bond to which such damaged, mutilated, lost, stolen, or destroyed coupon appertained, in exchange and substitution for, or in lieu of and substitution for, the Bond and appurtenant coupons to which such damaged, mutilated, lost, stolen, or destroyed coupon appertained, submit such replacement Bond to the Attorney General of Texas for his approval and otherwise cooperate with the Bondholder of any such Bond is complying with the provisions of Article 715a, Vernon's Texas Civil Statutes, as amended, or any other statute or procedure available for the issuance of replacement Bonds or coupons. (c) Application for exchange and substitution of damaged, mutilated, lost, stolen, or destroyed Bonds and coupons shall be made to the Authority. In every case, the applicant for a substitute Bond shall furnish to the Authority and Baytown such security or indemnity as may be, respectively, required by them to save each of them and the Paying Agent harmless. In every case of loss, theft, or destruction of a Bond or a coupon, the applicant shall also furnish to the Authority and Baytown evidence to their respective satisfaction of the loss, theft, or destruction and proof of ownership. In every case of loss, theft, or destruction or a coupon or coupons only, the applicant shall surrender the Bond to which the coupon or coupons so damaged, mutilated, lost, stolen, or destroyed appertain, with all coupons appertaining thereto (including any damaged or mutilated coupons) not lost, stolen, or destroyed. In every case of damage or mutilation of a Bond only, or a Bond without coupons, the applicant shall surrender the Bond so damaged or mutilated together with all coupons, if any, appertaining thereto. (d) Notwithstanding the foregoing provisions of this Section 16, in the event any such Bond or coupon shall have matured, and no default has occurred which is then continuing in the payment of the principal or interest on the Bonds, the Authority may authorize the payment of the same (without surrender thereor except in the case of a damaged or mutilated Bond or coupon) instead of issuing a substitute Bond and coupons, if any, provided security or indemnity is furnished as provided above in this Section 16. (e) Upon the issuance of any substitute Bond, the Authority and Baytown may charge any such Bondholder with all expenses in connection therewith. Every substitute Bond (and any coupon or coupons attached thereto) issued pursuant to the provisions of this Section 16 by virtue of the fact that any Bond or any coupon is lost, stolen, or destroyed shall constitute a contractual obligation of the Authority, 80914 -18 Minutes of the Regular Meeting - September 14, 1978 whether or not the lost, stolen, or destroyed Bond or coupon shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Resolution equally and proportionately with any and all other Series 1978 Bonds and coupons duly issued under this Resolution. (f) This Resolution shall constitute sufficient authority for the issuance of any such substitute Bond without the necessity of further action by the Board or any other body or person, and the issuance of such substituted Bonds is hereby authorized, notwithstanding any other provisions of this Resolution. Section 17. No- Arbitrage. The Authority convenants that it will make no use of the direct or indirect proceeds of the Series 1978 Bonds which, if such use had been reasonably expected on the date of delivery of the Series 1978 Bonds, to and payment for the Series 1978 Bonds by the initial purchasers thereor, based on the facts, estimates, and circumstances in existence on such date would have caused the Series 1978 Bonds to be arbitrage bonds within the meaning of Section 103 (c) of the Internal Revenue Code of 1954, as amended, or any regulations or rulings pertaining thereto; and by this covenant the Authority further is obligated to comply with the requirements of the aforesaid Section 103 (c) and all applicable and pertinent regulations relating to arbitrage bonds. The Authority further covenants that the direct or indirect proceeds of the Series 1978 Bonds will not otherwise be used directly or indirectly so as to cause all or any part of the Series 1978 Bonds to be or become arbitrage bonds within the meaning of the aforesaid Section 103(c), or any regulations or rulings pertaining thereto. Section.18. Resignation and Removal of the Paying Agent and Appointment of Another Paying Agent. The Paying Agent may at any time resign and be discharged of the duties and obligations created by this Resolution by giving at least 60 days written notice by registered or certified mail to the Authority and Baytown. The Paying Agent may be removed, at any time, with the consent of Baytown, by an instrument filed with the Paying Agent and signed by the Authority. Any successor Paying Agent shall be appointed by the Authority with the approval of Baytown. In the event of resignation or removal, the Paying Agent shall pay over, assign, and deliver any monies.held by it as Paying Agent and any records maintained by it to its successor, or, if there be no successor, to the Authority. At any time or from time to time, with the approval of Baytown, the Authority may appoint one or more other Paying Agents for the Bonds. Section 19. CUSIP Numbers. The Board of Directors of the Authority authorizes the imprinting of CUSIP (the American Banker's Association Committee on Uniform Securities Identification Procedures) numbers on the Series 1978 Bonds; provided, however, that the failure of such CUSIP numbers to appear on the Series 1978 Bonds, or the imprinting of incorrect CUSIP numbers, shall in no way affect the validity or enforceability of the Series 1978 Bonds or relieve the purchaser of any obligation to accept delivery of and make payment for the Series 1978 Bonds. Section 20. Emergency. It is hereby officially found and determined tha a case of emergency or urgent public necessity exists which requires the holding of the meeting at which this Resolution is adopted, such emergency or urgent public necessity being that the proceeds from the sale of the Series 1978 Bonds are required as soon as possible and without delay for necessary and urgently needed public improvements and further that such meeting was open to the public, and public notice of the time, place, and purpose of Minutes of the Regular Meeting - September 14, 1978 such meeting was given, all as required by Article 6252 -17, Vernon's Texas Civil Statutes, as amended. Section 21. Effective Date. This resolution shall take effect from and after its passage by the Board of Directors of the Baytown Area Water Authority. the this INTRODUCED, READ, AND Board of Directors of day of _ ATTEST: Peter R. Buenz, Secretary APPROVED: 80914 -19 PASSED by the affirmative vote of the Baytown Area Water Authority , 1978. Robert L. Gillette, President Scott Bounds, Attorney for The Baytown Area Water Authority Receive Petitions None. City Manager's Report Proposed Airport Development - The Administration has been advised by the Consulting Engineers and the FAA that it is necessary to hold a public hearing concerning the proposed airport development north of the city. This hearing will be on the environmental impact statement which has been prepared and is available at City Hall for interested persons to review. The Administration has scheduled this hearing for October 12, 1978 at 7 :00 p.m., during the regular Council meeting. Clean Community Program - At the last Council meeting, City Council tentatively scheduled a work session to discuss the Clean Community Program to be held this week but it was postponed. It was suggested that the work session be held on Tuesday, October 3, 1978, at 5:00 p.m. Council had no objection. Lee College Music Department - The Lee College Music Department and the City of Baytown's Parks and Recreation Department are sponsoring an appearance of the United States Army Forces Command Band on Monday, September 18, 1978, from 7:30 p.m. to 8:45 p.m. Harris County Mayor's and Councilman's Association - The next meeting of the HCMCA is scheduled for Thursday, September 21. The program is "Meet Your Legislator." The Administration will check with Council later to determine how many of the Council members will be able to attend this meeting. Street Improvement Program - The base on Louisiana Street and Allman Street has been lime stabilized. The limestone has been added to the base between Bowie and Travis Streets. 80914 -20 Minutes of the Regular Meeting - September 14, 1978 Kilgore Road /Mockingbird Lane Storm Sewer Project - No work has been accomplished due to the heavy rain. There are still a few curb inlets to be completed, some road repairs, and general cleanup. Neighborhood Center at the Sports Complex - Some work has gone forward on that job in spite of the weather. Half of the roof deck is in place and the sheeting on the exterior walls is nearly complete. Jenkins - Hollaway Park - The work has been slow due to the rain but the concession stand and the scorekeeper building are almost complete; the water and sewer service lines are installed, and part of the asphalt paving has been finished. Questions or Comments Regarding the City Manager's Report Councilman Kloesel commented that he read an article concerning the flooding of the Brownwood area and asked what procedure is used regarding the floodgates. Mr. Lanham explained that the Administration has established a procedure during periods of heavy rains to have a person on duty on an overtime basis to check the floodgates, since the floats do not always work to turn the gates on automatically. Councilman Kloesel inquired if the residents of Brownwood open and close the floodgates. Mr. Lanham explained that there have been instances where the residents opened and closed the gates and turn the pumps on and off. Mr. Lanham explained that not all of the residents agree about when the pumps should be turned on or off. Mr. Lanham felt that it is necessary for the city to operate the pumps and that the pumps should be locked. Bill Miller Appeared Bill Miller appeared concerning the closing of Durrain Ferry Road. The Council received a petition on March 20, 1978, regarding the re- opening of Durrain Ferry Road, which has been closed temporarily due to construction of Spur 201. This was later followed with a work -shop appearance by people both for and against it. The original action of the Council was that no action would be taken until the com- pletion of the construction. That construction has not been completed. Within the last couple of weeks, permanent barriers have been installed and signs placed. After the original decision of Council to wait until completion of the construction to allow traffic to be re- established to a normal pattern, a motion was put before the Council and it was voted to close Durrain Ferry Road. Mr. Miller felt that this has not been properly handled. He felt the original decision of Council to wait until construction was complete would be the fairest. Mr. Miller suggested that Arizona Street be closed because it is a very hazardous street where motorists cross two lanes of traffic. Mr. Miller requested that Durrain Ferry Road be an open issue. Mr. Miller stated that he would return at a later date after normal traffic is re- established to give Council the traffic count and the technical information that is needed to make a determination. Mr. Miller commented that he has been using Durrain Ferry Road for many years and felt that is is unreasonable to close the street. He commented that he will donate land to continue Britton Street, which would tie Britton Street into Durrain Ferry Road. Ordinance - Approving Second and Final Reading on Annexation of Certain Properties Belonging to Mobay Chemical Corporation This is the second and final reading on the annexation 80914 -21 Minutes of the Regular Meeting - September 14, 1978 of a portion of the Mobay Chemical property. This annexation is being completed in accordance with the City's industrial district policy. The Administration recommended approval of the ordinance. Councilman Lander moved for adoption of the ordinance; Councilman Kloesel seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2516 AN ORDINANCE PROVIDING FOR THE EXTENSION OF CERTAIN BOUNDARY LIMITS OF THE CITY OF BAYTOWN, TEXAS, AND THE ANNEXATION OF CERTAIN TERRITORY, WHICH SAID TERRITORY LIES ADJACENT TO AND ADJOINS THE PRESENT BOUNDARY LIMITS OF THE CITY OF BAYTOWN, TEXAS. Ordinance - Including Certain Property Belonging to Mobay Chemical Corporation in the Proper Council District This would place the newly annexed property belonging to Mobay Chemical Corporation in Council District No. 4. This property is contiguous with Council District No. 4 and does not abut any other Council District. At present, no one resides on this property. The Administration recommended approval of the ordinance. Councilman Kloesel moved for adoption of the ordinance; Councilman Johnson seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2532 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN ADDING CERTAIN PROPERTY TO COUNCIL DISTRICT NO. 4; REPEALING ORDINANCES INCONSISTENT HEREWITH; CONTAINING A SAVINGS CLAUSE; AND PROVIDING FOR THE PUBLICATION AND EFFECTIVE DATE HEREOF. Ordinance - Prohibiting Angle Parking Within the Right -of- Way on Bayway Drive At its July 13 meeting, Council considered this item and at that time, Council delayed action for 60 days to give the property owners notice of the proposed action. The Administration has discussed this matter with the managers of the Aroma Cafeteria which will be the most affected. Aroma Cafeteria will lose a few parking spaces. The managers of the Aroma understand the reason for the prohibition. The Administration recommended approval of the ordinance. Councilman Kloesel inquired if the Administration had been able to contact any of the other property owners or businesses on Bayway. Mr. Lanham explained that other businesses were not contacted because most of the businesses in this vicinity do not require very much parking space. The angle parking in front of Aroma Cafeteria is now being utilized by employees. Councilman Johnson moved for adoption of the ordinance; Councilman Kloesel seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None 80914 -22 Minutes of the Regular Meeting - September 14, 1978 ORDINANCE NO. 2533 AN ORDINANCE PROHIBITING ANGLE PARKING WITHIN THE RIGHT OF WAY OF BAYWAY DRIVE; PRESCRIBING A MAXIMUM PENALTY OF TWO HUNDRED AND N01100 ($200.00) DOLLARS; AND PROVIDING FOR THE PUBLICATION AND EFFECTIVE DATE HEREOF. Ordinance - Authorizing the Purchase of a Sewer Easement from Jack Howard With the development of a fast -food store at the intersection of McKinney Road and State Highway 146, it was discovered that the city's sanitary sewer line is not located within the easement but on private property. An appraisal was made where the sum of $1,860.00 was established as the property's value. The city offered the appraised value for the property which has been accepted by Jack Howard, the owner of the property. The Administration recommended approval of the ordinance. Councilman Lander moved for adoption of the ordinance; Councilman Johnson seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2534 AN ORDINANCE AUTHORIZING THE ACQUISITION OF AN EASEMENT ACROSS LAND OWNED BY JACK A. HOWARD AND W. FLOYD HOWARD; AUTHORIZING PAYMENT BY THE CITY OF BAYTOWN OF THE SUM OF ONE THOUSAND EIGHT HUNDRED SIXTY AND N01100 ($1,860.00) DOLLARS; AND PROVIDING FOR THE EFFECTIVE DATE HEREOF. Ordinance - Awarding the Annual Contract for Water and Wastewater Supplies Four bids were received for the city's estimated annual supply of water and wastewater supplies. The Purchasing Department sent notices to bid to 27 companies, but received only one bid that met all the specifications, the bid of Utility Supply. Utility Supply's bid on estimated quantities is $245,297.52 less a 12% discount if all the bid is accepted. Council also received a copy of cost comparisons of the bids that were received and what is currently being paid - -there are some significant increases. Mr. Lanham expressed concern that the City only received one complete bid. He stated that the city has been buying from this company for a number of years and has received good service. Mr. Lanham explained that if Council approves the money that the Administration requested in revenue sharing to begin the water meter replacement, this will be a significant item because the city plans to buy approximately 2,200 meters next year. The Administration recommended approval of the ordinance.(See Bid Tabulation Page 90914 -22a) In response to a question from Councilman Kloesel, Mr. Lanham explained that the meters bid are Rockwell meters which have provided good service in the past. Mr. Lanham remarked that he felt that these increased costs is an indication that the city should examine the tapping fees. Councilman Lander moved for adoption of the ordinance; Councilman Kloesel seconded the motion. Councilman Cannon inquired if the city would be permitted to go out for six -month contracts because many times, companies do not want to be committed for an entire year and this might resolve part of the cost problem. Mr. Lanham stated �jTL �. WATER AND WASTEWATER SUPPLIES 31 D� 739 -s7 SATE= September 5> 1978 - 9:30 a.m. 'TEM QTY DESC R t PT10N SECTION 1. - REPAER CLAMPS SECTION ll. - BRASS FITTINGS SECTION 111. - IRON FITTINGS SECTION IV. - GALVANIZED FITTINGS SECTION V. - POLYETHYLENE PIPE ECTION Vl. - ASBESTOS - CEMENT PIPE ECTION V11.- CAST IRON CASTINGS ECTION V111. - METER BOXES ECTION IX. - POLYVINYL PIPE ECTION X. - FIBERGLASS MANHOLES ECTION Xl. - WATER METERS Twenty Seven Companies were mailed notices to bid. GROSS TOTAL LESS DISC. • ,�1 ET .TOTAL DELI'v ERY t3U914 -22a CITY OF BAYTOU�.�V • B1D TABULATI QN . �. UTILITY SUPPLY UTILITY SUPPLY SOUTHWEST SUPPLY THE MARQUE CORP. NEPTUNE WATER MET UNIT EXTENDED UNIT EXTENDED UNIT XTENOEO UNIT EXTENDED UNIT EXTENDED Ic I $216,251.00 $245,297.52 13,319.20 $15,135.45 * $ 8 >339.77 0 BID NO B(0 ix • 18,353.10 20,727.96 �r 1 2 .12 3, 33 0 B1D NO BlD ��• 23,547.69 26,757.15 * 1 67.76 5,5 0 BID NO BID �� 128.16 144.92 NO .BID 0 BID NO BID 2,800.00 3,075.00 • 2,591.26 0 BID NO 810 13,651.35 15,502.12 14,010.60 0 B1D NO B!D �•- 7,856.75 8,927.40 * 2,516.00 0 BID NO B!D �5,63i.30 b,396.10 � 6,565.50 0 slD NO B1D � e 39,972.63 45,247.48 zt 38,459.09 0 BID iJ0 BID � 6,891,32 •7,830.99 NO BlD $ 8,175.00 NO BID Ei !� • 84,099.50 95,552.95 63,677.65 NO BID 583,187.50 ;i 1 E,960.74:� y'� BASE BID LESS 12� BASE BID *INCOMPL TE SECTION lF ALL S CTIONS ACCEPTED + ., $216,251.00 $245,297.52 N 80914 -23 Minutes of the Regular Meeting - September 14, 1978 that a solution to part of the problem could be to take bids separately on water meters. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2535 AN ORDINANCE APPROVING THE PURCHASE OF WATER AND WASTEWATER SUPPLIES BY ACCEPTING THE BID OF UTILITY SUPPLY COMPANY FOR SECTION NO. I THROUGH XI OF THE CITY OF BAYTOWN BID NO. 789- 87 AND AUTHORIZING PAYMENT BY THE CITY OF BAYTOWN IN THE AMOUNT OF TWO HUNDRED SIXTEEN THOUSAND TWO HUNDRED FIFTY -ONE AND N01100 ($216,251.00) DOLLARS. Public Hearing on the Request of Houston Lighting and Power Company for Rate Increase Mayor Hutto opened the public hearing on the request of Houston Lighting and Power Company for a rate increase at 7:00 p.m. Scott Bounds, City Attorney, explained that Houston Lighting and Power Company has presented an application to City Council requesting approval of a general rate increase. This request was to be effective as of August 21, 1978. However, Council suspended that effective date 120 days pending investigation of the reasonableness of the request. Section 43c of the Public Utility Regulatory Act, under which the city now exercises its authority to regulate utility rates, provides that the City shall hold a hearing within 30 days from the proposed effective date in every case where there is a major change in rates. In order to meet this statutory deadline, this hearing was called. Next Monday, the Public Utilities Commission opens its hearing on the rate increase proposal. Those hearings will extend through the week of October 2. In order to avoid any conflict with those hearings and in order to use the material developed for those hearings, Mr. Bounds advised Council to recess the public hearing until October 19 and to direct H L & P to make a presentation at that time regarding the proposed rate increase. Councilwoman Wilbanks moved to recess the public hearing until October 19, 1978, at 7:00 p.m., and requested that H_-L_& P make a presentation to Council at that time; Councilman Johnson seconded the motion. In response to a question from Council, Mr. Bounds explained that the hearing could be held at anytime, but the 19th was suggested to allow H L & P ample time for the preparation of their presentation. In response to a question from Councilman Lander, Mr. Bounds explained that the cities are required to make a presentation to the Public Utilities Commission on Monday. A great deal of that that testimony will be reduced to writing. The Public Utilities staff will present its testimony the following week. The main portion of the hearing will begin the week of October 2. A large amount of the information will be reduced to writing which will be made available to City Council. The city in cooperation with the City of Houston has retained Touche Ross. This firm has prepared a presentation for the cities to present to the Utilities Commission on Monday. After the hearing before the Commission, Touche Ross will hopefully understand the status of H L & P's request. Therefore, the city might plan to have Touche Ross representatives attend the October 19 meeting to discuss 80914 -24 Minutes of the Regular Meeting - September 14, 1978 this further with Council. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None At this time, Mayor Hutto recessed the public hearing until October 19, 1978, at 7:00 p.m. Ordinance - Awarding the Bid for Police Department Brake and Alignment Svstem Seven bids were received for the purchase of brake and wheel alignment systems for the Police Department garage. The bid tabulation follows: WHEEL ALIGNMENT BRAKE LATHE BRAKE LATHE SYSTEM & GRINDER Richard Holley Co. $6,150.00 $2,400.00 $3,500.00 J.V. Equipt. Co. $6,382.65 $3,468.00 $4,936.80 Hunter Equipt. Co. $9,384.00 $3,769.00 $5,162.50 Vasco Equipt. Co. $8,029.90 $2,630.00 $3,600.00 Marand Sales Co. $6,500.00 $2,720.00 $3,376.00 Bratten Equipt. Co. $8,088.25 $2,523.00 $3,604.00 The recommended bidder for the wheel alignment system is Vasco Equipment Company in the amount of $8,029.90. Lower bids which were submitted did not meet specifications. Bidders were given the option of bidding on a brake lathe or brake lathe with grinder. The Administration recommended acceptance of the bid of Marand Sales Company for the amount of $3,376.00 for the brake lathe with grinder. This is the low bid that meets specifications. The proposed ordinance awards the bid for the alignment system to Vasco Equipment Co. and the bid for the brake system to Marand Sales Co. The Administration recommended approval of the ordinance. Councilman Johnson moved for adoption of the ordinance; Councilman Cannon seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2536 AN ORDINANCE APPROVING THE PURCHASE OF A WHEEL ALIGNMENT SYSTEM BY ACCEPTING THE BIDS OF VASCO EQUIPMENT COMPANY FOR ITEM NO.1 AND MARAND SALES COMPANY FOR ITEM NO. 2B; AND AUTHORIZING PAYMENT BY THE CITY OF BAYTOWN FOR EACH ITEM AS SET OUT BELOW. Ordinance - Authorizing Final Payment of Country Club Water Line Replacement Contract The Administration recommended that Council pass a revised ordinance which has been placed at the Council 80914 -25 Minutes of the Regular Meeting - September 14, 1978 table, finding that the construction of this water line is substantially complete, but withholding $15,000 because the contractor was unable to complete the cleanup due to rain. Councilman Lander moved for adoption of the ordinance; Councilman Johnson seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2537 AN ORDINANCE FINDING THAT THE CONSTRUCTION OF THE COUNTRY CLUB WATER LINE REPLACEMENT PROJECT IS SUBSTANTIALLY COMPLETED IN ACCORDANCE WITH THE TERMS OF THE CONTRACT; ACCEPTING THE CONSULTING ENGINEERS' CERTIFICATE OF SUBSTANTIAL COMPLETION; AUTHORIZING THE PAYMENT TO R.T. BISHOP CONSTRUCTION COMPANY, INC. AND R. T. BISHOP, JOINT VENTURE, OF A SUM SUFFICIENT TO INCREASE TOTAL PAYMENT TO ONE HUNDRED PERCENT (100 %) OF THE CONTRACT SUM, LESS RETAINAGES SPECIFIED BY THE ENGINEERS FOR ALL INCOMPLETE WORK AND UNSETTLED CLAIMS AND PROVIDING FOR THE EFFECTIVE DATE HEREOF. Ordinance - Approving and Accepting the Sterling Municipal Library Expansion and Authorizing Final Payment to Spaw- Glass, Inc. Several months ago, Council found this building to be substantially complete and authorized payment with the exception of $1,350.00. This final payment was delayed because of the need to install an exterior tile band on the building which work has been completed. The Administration recommended approval of the ordinance. Councilman Kloesel moved for adoption of the ordinance; Councilman Lander seconded the motion. Councilwoman Wilbanks inquired about the Library air conditioning. Flora Wilhite, Director of Sterling Municipal Library, explained that she had talked with Les McDonald, the designer of the air conditioning system. Mr. McDonald is trying to resolve the problem. When the air conditioning is not working properly, a serviceman is dispatched promptly. However, Currie, the firm that worked with Spaw -Glass on this project, has billed for service beyond the warranty date which was February 1978. No bills have been received from Spaw -Glass for this service. Mr. Lanham suggested that Council could delay taking action on this item until the Administration can talk with the architect. Mayor Hutto commented that in a job of this magnitude, it is frivolous to think that holding up $1,350 will make much difference to the contractor and he felt that Council should authorize final payment. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2538 AN ORDINANCE APPROVING AND ACCEPTING STERLING MUNICIPAL LIBRARY EXPANSION FINDING THAT THE IMPROVEMENTS ARE IN TERMS OF THE CONTRACT; ACCEPTING THE OF FINAL ACCEPTANCE; AUTHORIZING THE SAID SPAW- GLASS, INC. AND PROVIDING HEREOF. CONSTRUCTION OF THE BY SPAW -GLASS INC.; ACCORDANCE WITH THE ARCHITECTS' CERTIFICATE FINAL PAYMENT OT THE FOR THE EFFECTIVE DATE 80914 -26 Minutes of the Regular Meeting - September 14, 1978 Ordinance - Accepting Certain Properties in the Brownwood Subdivision Mr. and Mrs. Roland Armstrong own Lot 15, Block F of the Brownwood Subdivision. They would like to dedicate this lot to the City of Baytown at no cost to the City. The Armstrong's have moved a residence off this property. It no longer serves any purpose for them and they would like to donate the land to the City at this time in anticipation that the Brownwood Relocation Project will be implemented. If the City accepts this property, it will have the responsibility of maintaining it. The Administration recommended approval of the ordinance. Councilman Kloesel moved for adoption of the ordinance; Councilman Johnson seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2539 AN ORDINANCE ACCEPTING THE LAND DEDICATION BY ROLAND P. ARMSTRONG AND MARY M. ARMSTRONG: DIRECTING THE CITY CLERK TO FILE SAID DEDICATION WITH THE COUNTY CLERK OF HARRIS COUNTY, TEXAS, AND PROVIDING FOR THE EFFECTIVE DATE HEREOF. Ordinance - Awarding the Bid for the Demolition of Dilapidated Buildings Six bids were received for the demolition of the old Goldfield Building located at 13 N. Main just north of the Chamber of Commerce Building. The bid tabulation follows: COMPANY LOCATION COMPLETION TIME COST Angel Eqpt. 13 N. Main 30 days $10,500. to 1112 Daniel 30 days 3,000. Walkers Serv. 13. N. Main 10 -20 -78 8,800. of 1112 Daniel 10 -5 -78 1,350. A -1 Home Imp. 13 N. Main 10 days 7,755. to 1112 Daniel 2 days 800. Olshan Demo. 13 N. Main 30 days 6,400. " 1112 Daniel 30 days 1,050. Martin & Sons 13 N. Main 60 days 7,864.50 it 1112 Daniel 30 days 852. Savell Const. 13. N. Main 3 weeks 9,500. " 1112 Daniel 3 weeks 5,000. Olshan Demolition Company submitted the low bid in the amount of $6,400. The Urban Rehabilitation Board has studied the bids and recommended that the bid be awarded to Olshan Demolition Company. This building is in a badly deteriorated state. The Legal Department is working on clearing up the taxes owed on this property. The Administration recommended approval of the ordinance. Councilman Lander moved for adoption of the ordinance; Councilman Johnson seconded the motion. In response to a question from Councilman Kloesel, Mr. Lanham explained that the only demolition bids that are brought before Council are the ones totalling over $2,000. 80914 -27 Minutes of the Regular Meeting - September 14, 1978 The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Nays: None ORDINANCE NO. 2540 AN ORDINANCE ACCEPTING THE BID OF OLSHAN DEMOLISHING COMPANY, INC. FOR THE DEMOLITION OF THE STRUCTURE AT 13 NORTH MAIN STREET; AUTHORIZING EXECUTION OF A CONTRACT FOR SIX THOUSAND FOUR HUNDRED AND NO 1100 ($6,400.00) DOLLARS; MAKING VARIOUS FINDINGS AND PROVISIONS RELATED TO THE SUBJECT. Councilman Kloesel inquired about the demolition of a building on Minnesota Street which had burned but never had been cleared away. Jack Cramer, Chief Building Inspector, commented that his department is working on that at the present time. Ordinance - Setting Construction Speed Limits on a Portion of Loop 201 Council received a copy of a letter from Omer F. Poorman, District Engineer for the State Department of Highways and Public Transportation. In his letter, Mr. Poorman requests that the City of Baytown establish a construction speed zone along that portion of the proposed Loop 201 which extends between Decker Drive and State Highway 146. The Highway Department anticipates letting a contract to construct structures, grading, and storm sewers along this portion of the Loop in December, 1978. The proposed ordinance sets the construction speed limit at 35 MPH for this portion of the Loop. The Administration recommended approval of the ordinance. Councilman Lander moved for adoption of the ordinance; Councilman Kloesel seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None ORDINANCE NO. 2541 AN ORDINANCE EXTABLISHING SPEED LIMITS DURING CONSTRUCTION ON A PORTION OF LOOP 201 WITHIN THE CORPORATE LIMITS OF BAYTOWN AND PROVIDING A PENALTY FOR THE VIOLATION THEREOF. Resolution - Authorizing the City Manager to Make Application for a CETA Program Grant Through Harris County The next two items would authorize the City Manager to make application for CETA Program Grants through Harris County. The first program would be similar to programs which the city has operated in the past. Under the terms of the proposed program, the city would employ 12 individuals under the Title VI CETA Program. These individuals would have to meet certain income and employment guidelines and Harris County would certify their eligibility under the program. The City would be responsible for providing work opportunities for these employees and assisting in their learning both good work habits and work skills. Harris County would provide federal funds to cover the employees salaries and fringe benefits. The Administration plans to use these employees in the Municipal Court, Library, Meter Department, Police, and Public Works. The Administration recommended approval of the resolution. Councilman Johnson inquired if this is a successful program. Mr. Lanham explained that this program has proven 80914 -28 Minutes of the Regular Meeting - September 14, 1978 to be successful in the past, and many of the people who were employed under CETA were moved into permanent positions in the city when vacancies occurred. The second proposed resolution would authorize the City Manager to make application for a Title III CETA Youth Program Grant through Harris County. Under the terms of this proposed application, the City would hire 16 youths between the ages of 16 and 19. This program is directed primarily toward high school drop -outs. These employees would be placed at city job sites and would work under the direction of city employees. These individuals would be paid directly by Harris County Manpower. The Administration recommended approval of the resolution. Councilman Kloesel moved for the adoption of Resolution No. 641 and Resolution No. 642; Councilman Johnson seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None RESOLUTION NO. 641 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS, AUTHORIZING THE CITY MANAGER TO MAKE APPLICATION FOR A CETA GRANT UNDER THE EMERGENCY JOBS AND EMPLOYMENT ACT. RESOLUTION NO. 642 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS, AUTHORIZING THE CITY MANAGER TO MAKE APPLICATION FOR A CETA YOUTH PROGRAM GRANT UNDER THE EMERGENCY JOBS AND EMPLOYMENT ACT. Consider Establishment of a Private -Use Airport The Administration has received a notice from Kenneth Stephenson, Airspace Specialist for the Federal Aviation Administration's Southwest Region Office in Fort Worth. In this notice, Mr. Stephenson indicates that Steve Hebert and Bill Roberts are proposing to construct a private -use airport in the vicinity of McNair, Texas. The private -use airport would be relatively close to the proposed site for the Baytown Municipal Airport. It is estimated there will be 30 single engine aircraft and 10 multi - engine aircraft with 400 landings per month within 5 years. IFR operations are planned within 5 years. The Administration felt that the private -use airport would interfere with the development of the proposed municipal airport. The Administration requested authorization to submit comments to the FAA opposing the location of this private -use airport because of the impact it will have on the development of the proposed Baytown Municipal Airport. Councilman Kloesel commented that his reservation is that the city might be moving into this opposition too rapidly. He inquired as to the amount of time available to oppose the application. Mr. Lanham responded that the city has until September 30, 1978. Mayor Hutto pointed out that Council could oppose the application and could withdraw opposition if the city's proposed municipal airport location does not prove feasible. Councilman Cannon commented that Council is giving consideration to the Humphrey Airport at the present time, and the city does not want to hurt existing private enterprise. 80914 -29 Minutes of the Regular Meeting - September 14, 1978 He felt that the Council should protect its interests in that area by going on record as opposed to the location of the private -use airport. Councilman Lander commented that he, too, has some reservations similar to Councilman Kloesel because the city's proposed airport is not a 100% certainty. However, Council does need to make it known that the municipal airport is being considered seriously. It would be a safety hazard to have two airports in such close proximity. Councilman Cannon stated that if the city's proposed airport does not go through, he would be glad to withdraw any opposition to the private -use airport. Councilman Kloesel favored Council meeting with the proponents of the proposed private -use airport. He felt that Council should take some time to make a decision and felt that Council could make a decision on this at the last Council meeting in September. Councilman Cannon commented that Council has the opportunity to go on record as opposing any additional airport in the area until the city's own proposed site is resolved. Should the FAA not approve the city's proposed site, the Council could then withdraw the opposition to a proposed private enterprise airport. Councilman Kloesel moved to postpone action on this item until the next Council meeting. The motion died for lack of a second. Councilman Lander moved that Council go on record as opposing the establishment of the private -use airport; Councilman Cannon seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None Abstained: Councilman Kloesel Review a Policy Established on Placement of Buoys and Consider Proposing a Resolution Requesting that the State Legislature Amend the Law Regarding Recreational Fishing At the last Council meeting, Councilman Kloesel requested that an item be placed on the agenda regarding the buoys which restrict recreational fishing in Scott, Burnett and Crystal Bays. Council received a copy of a memorandum from Randy Strong, Assistant City Attorney. Mr. Bounds commented that basically the memorandum outlines the state law that has applied and presently applies to shrimping in these bays. Prior to the placement of the buoys, Section 77.089 permitted a person to catch shrimp for bait at any time of the year by use of a manually operated net. A possession limit of two quarts of shrimp per person or four quarts of shrimp per boat is established by this section. After the buoys were placed in the bays, it made effective a state law that already existed that prohibited shrimping or fishing by the use of a seine, drag line, fyke, setnet, trammel net, trap, dam, or weir from a bay in Harris County within one mile of the limits of a city. A 1977 Attorney General Opinion stated that this statute also prohibited the use of a trawl. At the present time, this statute would control over the prior state laws and would prohibit any use of nets to take shrimp or fish from these bays. At this time, a sports fisherman is not prevented from using a rod and reel or similar device to catch fish. Section 201.016 allows a person to use up to three crab traps in Burnett, Crystal, or Scott Bays, and does not place any restriction on the use of crablines, hooks, lines, or trot lines usually employed for the catching of crabs. 80914 -30 Minutes of the Regular Meeting - September 14, 1978 Councilman Kloesel stated that the complaints he receives have to do with wording on the buoys. Four buoys state "no fishing" and the remainder of the buoys state "restricted fishing and shrimping." Mr. Bounds explained that the wording on the buoys has no effect upon the state statute. Councilman Kloesel commented that the fisherman does have the responsibility to know the law but felt that the city needs to have the wording to indicate that there is restricted fishing and shrimping along with a short reference to the law below the wording. Councilman Kloesel also expressed concern that the Game Wardens may not be cooperating with the citizens when questions are raised. Mayor Hutto commented that the buoys are not large and the writing is small, but the wording "no fishing" is in error because fishing is permitted by rod and reel but not permitted by net. Councilman Kloesel inquired if the wording "restricted fishing" is to be written on all buoys. Mr. Lanham explained that the four buoys with the wording "no fishing" were left in the bays after the original buoys disappeared, and the wording can be changed on those four buoys to state "restricted fishing." Mayor Hutto recognized Dick Manning, who suggested that to be consistent with what the law specifies and with the limitation of space on the buoys, the city could be very precise and avoid all confusion by putting the words "no netting" on the buoys. Mr. Bounds stated that the wording on the buoys was worked out with the Parks and Wildlife Department, and the Administration would need to discuss the changed wording with that department. Councilwoman Wilbanks felt that Council would not be able to resolve this problem by changing wording on a sign. She felt that if Council would indicate that it is "restricted fishing ", it would be encumbent on the city and the state to have material available to inform the people what is meant by a restricted fishing area. Councilman Lander commented that there are thousands of laws that citizens do not understand and the city is not able to keep a stack of laws and pamphlets to educate everyone on everything. This is not the responsibility of the city, but is the responsibility of each individual to know the law. Mayor Hutto recognized a woman in the audience who commented that she is a sports- minded person, and as such, any person who does fishing and shrimping should know the law before they do so. Mr. Lanham assured the Council that the four buoys that have "no fishing" will have the wording changed to be consistent with the other buoys. Consider Request of Property Owners for Water and Sewer Service Outside the City Limits Five property owners who own property along Bush Road outside the city limits have requested that the city provide water and sewer service to them. They are developing plans and specifications for approval by the City Engineer. If this request is approved, the cost of installing the necessary water and sewer services will be paid. Also, the property owners will pay twice the minimum and one and one -half times the normal rates over the minimum for these services, plus 80914 -31 Minutes of the Regular Meeting - September 14, 1978 the $100 buy -in charge for sewer service. Mr. Lanham commented that he felt this area will someday be annexed by the city. The Administration recommended approval of the request. Councilman Johnson moved for approval of this request for water and sewer service outside the city limits; Councilman Johnson seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Kloesel, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None Consider Appointments to the BAWA Board Councilman Kloesel stated that he strongly felt that the appointments to the BAWA Board and any major board of the city should be made in a public meeting. He further emphasized that he does not consider this a personnel matter. His view of personnel matters consists of discussing employees of the city. Since the BAWA Board has a large budget to deal with and much business to transact, he felt that the appointments should be made in public. Mayor Hutto pointed out that the city's policy has been to appoint the members in public but if there is any discussion regarding the people involved, this has been done in executive session. Councilman Kloesel moved that the appointments to the BAWA Board be made in public and any discussion related to the appointment of this Board be made in public. Councilman Klosesl inquired if state action would be required in order for this Board to be elected. Mr. Bounds stated that this is correct. The motion died for lack of a second. Councilman Kloesel asked that a resolution be prepared for the next meeting, asking that the state change this power to an elected board. Councilman Lander mentioned that this action would remove the jurisdiction of BAWA from the City Council. Councilman Kloesel felt that there are too many appointed boards which are responsible to the Council but are not responsible to the city. Councilman Lander felt that such appointments can be discussed more thoroughly in closed session because Council would be reluctant in some cases to discuss prospective appointees in an open session. Councilman Lander stressed that if the boards are elected boards, they will operate independently of Council. Committee Reports None. Unfinished Business None. Recess and Reconvene Mayor Hutto recessed the open meeting into executive session to discuss personnel matters. *Councilman Kloesel did not attend the executive session. When the open meeting was reconvened, the following business was transacted: 80914 -32 Minutes of the Regular Meeting - September 14, 1978 Appointments to the BAWA Board Councilman Lander moved for the reappointment of Peter R. Buenz and Harry Hartman to the Baytown Area Water Authority Board; Councilman Cannon seconded the motion. The vote follows: Ayes: Council members Lander, Johnson, Wilbanks, Caffey, and Cannon Mayor Hutto Nays: None Abstained: Councilman Kloesel Councilman Kloesel inquired about the makeup of the members of the BAWA Board. Mr. Lanham explained that Robert Gillette - Chairman, I. J. Butrick - Vice - President, Peter Buenz - Secretary, and Tillman O'Brien, Jr. and Harry Hartman - Board members. Adjourn With no further business to be transacted, Councilman Johnson moved for adjournment; Councilwoman Caffey seconded the motion. The vote for adjournment was unanimous. Karen Petru, Deputy City Clerk APPROVED: