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2001-05-15 SPECIAL SOUTHLAKE PARKS DEVELOPMENT CORPORATION MEETING May 15, 2001 MINUTES Board Members Present: President Ronnie Kendall; Members: Sherry Berman, Rex Potter, Rick Stacy, Tad Stephens, and Cara White. Board Members Absent: Gary Fawks Staff Present: Director of Community Services Kevin Hugman, Deputy Director of Community Services Steve Polasek, Finance Director Sharen Elam, Financial Consultant Jim Sabonis, and Secretary to the City Manager Kim Bush. Agenda Item No. 1, Call to order. The meeting was called to order by President Ronnie Kendall at 5:04 p.m. Agenda Item No. 2, Executive Session. No executive session was necessary. REGULAR AGENDA: Agenda Item No. 4A. Resolution No. SPDC 01-02, authorizing the issuance of "Southlake Parks Development Corporation Sales Tax Revenue Bonds, Series 2001"; pledging certain "Pledged Revenues" of the Corporation, including "Gross Sales Tax Revenues," to the payment of the principal of and interest on said Bonds and enacting other provisions incident and related to the issuance, payment, security and delivery of said bonds, including the approval and execution of a Paying Agent/Registrar Agreement, a Purchase Contract and a Financing/Use Agreement with the City and the approval and distribution of an Official Statement, and resolving. Finance Director Sharen Elam reminded the Board that in March SPDC authorized a public hearing to be set on this date for the purpose of issuing SPDC bonds to fund capital projects. Approval of Resolution No. SPDC 01-02 authorizes the issuance of $4,690,000 in bonds, which is accounted for in this years' SPDC CIP. Ms. Elam further explained that in order for the sales tax revenue bonds to be issued, the City Council must also consider a resolution that authorizes SPDC to issue the bonds. This is required under Section 4B of the Development Corporation Act of 1979. The resolution will also include a Financing/Use Agreement with SPDC, in which the Board authorizes the City to construct projects and to invest and disburse funds. Financial Consultant Jim Sabonis made a brief presentation and handed out a "Summary of Bond Sale" to the Board for reference. Mr. Sabonis explained that due to the market, interest rates have increased slightly, but the rate for these bonds is still very good. He emphasized that SPDC's rate is based on historical sales tax collections. He also informed the Board that if rates should come down and sales tax collections increase, the Board could look at refunding, but he would not look at this as a temporary financial obligation - still need to plan on long term financing. Mayor Stacy asked if the SPECIAL SPDC MEETING MINUTES - MAY 15, 2001, PAGE 1 OF 3 Board could reallocate the money to different projects than what was originally planned. Mr. Sabonis commented that there is some flexibility if it were based on the changing needs of the community. Mayor Stacy commented that SPDC needs the cash flow now, but he does not want to see a 30-year debt. He commented that SPDC should be able to look at refunding in a couple of years. Councilmember Potter agreed that SPDC should be able to look at it again in at least five years. There were no comments during the Public Hearing. Motion was made to adopt Resolution No. SPDC 01-02 authorizing the issuance of "Southlake Parks Development Corporation Sales Tax Subordinate Lien Revenue Bonds, Series 2001" in the aggregate principal amount of $4,690,000 at a true interest cost rate of 5.6508938%; approving and authorizing the execution of a Paying Agent/Registrar Agreement with the Chase Manhattan Bank, a Financing/Use Agreement with the City, and a Bond Purchase Contract with J.P. Morgan in relation to such Bonds; approving the insurance commitment and Guaranty Agreement with Ambac Assurance Corporation and approving and authorizing distribution of the Official Statement. Motion: Potter Second: White Ayes: Berman, Kendall, Potter, Stacy, Stephens, White Nays: none Approved: 6-0 Agenda Item No. 4B. Approval of Change Order No. 1 with Botanical Technology to construct restroom building #2 at Bob Jones Park. Community Services Director Kevin Hugman explained that during the CIP discussions with SPDC last summer, the Board requested that staff pursue moving up the construction of restroom #2 at Bob Jones Park. SPDC subsequently approved the FY 2001-2002 CIP with an additional $450,000 in the Bob Jones Park project for the addition of this restroom. Staff then pursued a change order with the contractor currently on the project - Botanical Technologies. The proposed change order amount is $292,306 which is well within the maximum 25% increase of an awarded contract (being 11.5% of the awarded contract of $2,529,045). Staff tried to work with the contractor to reduce this amount because they felt some costs were unnecessary. The contractor was not willing to delete the costs recommended by staff, therefore, staff recommends the bid be rejected and staff be authorized to put the facility out for competitive bidding. Mr. Hugman said they felt comfortable that the cost would decrease substantially if it were competitively bid. He also reminded the Board that at the last SPDC meeting during the discussion on the softball complex, there was some discussion by Board members about not doing restroom #2 at this time and possibly reallocating the funds to the softball complex project at Bicentennial Park. If the Board desires to delay the project, we will only incur the design fees at this time and the bulk of the funding for the restroom can be held in reserve. The Board agreed that before committing the funds to restroom #2 at Bob Jones, they would like to see the project bid and look more closely at alternatives for the softball complex. There were no comments from the audience during the public hearing. SPECIAL SPDC MEETING MINUTES - MAY 15, 2001, PAGE 2 OF 3 Motion was made to deny Change Order #1 with Botanical Technologies to construct restroom facility #2 at Bob Jones Park and authorize staff to seek competitive bids for this facility. Motion: Stacy Second: Potter Ayes: Berman, Kendall, Potter, Stacy, Stephens, White Nays: none Approved: 6-0 Agenda Item No. 5. Adjournment. Motion was made and carried to adjourn the meeting at 5:40 p.m. Vice Pre dent Rex Potter ATTEST: ~ < A im rtive Exeecre tary SPECIAL SPDC MEETING MINUTES - MAY 15, 2001, PAGE 3 OF 3