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Min 12/11/1984 i 607 Wichita Falls, Texas Memorial Auditorium Building December 11 , 1984 Items 1 & 2 The City Council of the City of Wichita Falls, Texas, met in called session on the above date in the Council Room of the Memorial Auditorium Building at 10:00 o'clock A.M. , with the following members present. Gary D. Cook Mayor Thomas E. Swift Charles Thomas Charles Harper Councilmen Craig A. Wilson Bill Palmer James A. Welburn James Berzina City Manager H. P. Hodge, Jr. City Attorney Wilma J. Thomas City Clerk Fred L. Werner Chief Accounting Officer The invocation was given by Councilman Wilson. Item 3 Financial Advisor Murphy Davis stated that they made a trip to New York to advise Moody's and Standard and Poore' s of what we are doing in Wichita Falls, and the financial condition of Wichita Falls, as it relates to water and sewer revenue bonds. Moody's gave us a strong rating of A-1 . Standard and Poore's rating for the City was A+. They did not go ahead with the insurance when the bonds could be sold with a very strong A-1 rating, and money will be saved. Once the insurance was eliminated, the final figure is $19,955,000. The coupon interest cost is 9.99 percent. He has the documents to sign to effect the bond sale. Mr. Davis recommended that the bonds be sold before the end of the year because of the low interest rate for bond financing. They did not want to chance the interest rate being higher. A second thing is that if they had waited until after the first of the year they would have been waiting for the February debt service payment that the city owes on the bonds. They would have had to do recalculations, and the net amount of financing would have had to be changed. The final closing and date of bond money being received by the City is January 15, 1985. Councilman Swift stated that the first question he would receive pertains to lower water and sewer rates. Mr. Davis stated that on issuance of future additional bonds, it would permit the City to charge a lesser rate for water and sewer service. It does not affect current conditions. Mr. Davis stated that he hoped this one sentence would not be taken out of context. Mayor Cook stated that it means that these rates and interest costs, and the entire bond issue, has been done on the current rate structure of water and sewer rates, and on earnings of the city at the present time. It does not mean that rates will not be looked at in another year. We are able to get these bond rates passed on the city' s current condition. Mr. Davis stated that these bonds are paid for solely from the revenues received from water and sewer service. It has nothing to do with the tax rate, or -tax base, of the City of Wichita Falls. It is a user charge. Councilman Harper confirmed that this provides 12 million dollars for the Cypress Street expansion plan. Mr. Davis stated that the remainder is for refunding and expense associated with refunding. Mayor Cook asked if the 9.9 interest rate is a good rate for cities in Texas? Mr. Davis stated that he is very pleased with it. We would have to compare with cities of our size, and economic conditions, and an issue of about the same size. This is not as low as a tax bond, secured by taxes of 608 Item 3, Cont'd. the City. The interest rate for these bonds is 9.5 percent. We will save one- quarter million dollars in reduction of interest costs. Rick Porter, of McCall , Parkhurst, and Horton, summarized the provisions of the ordinance authorizing the issuance of $19,955,000 in water and sewer revenue bonds. Mayor Cook asked Mr. Porter to furnish the Council with copies of the various ordinances and resolutions because they have not seen them. ORDINANCE NO. 145-84 ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF CITY OF WICHITA FALLS, TEXAS WATER AND SEWER REFUNDING REVENUE BONDS, SERIES 1984 Moved by Councilman Harper that Ordinance No. 145-84 be passed. Motion seconded by Councilman Welburn. Councilman Wilson requested that this information be presented to them sooner, in the future, so that they can have a chance to review it. Mr. Porter stated that this is covered in the preliminary data presented to the Council . The motion was carried by the following vote. Ayes: Mayor Cook, Councilmen Swift, Thomas, Harper, Wilson, Palmer, and Welburn Nays: None Item 4 Mr. Porter explained the resolution calling the water and sewer revenue bonds to be refunded in the Series 1984 issue. RESOLUTION NO. 239-84 RESOLUTION DIRECTING THE REDEMPTION OF CERTAIN OUTSTANDING CITY OF WICHITA FALLS WATER AND SEWER REVENUE BONDS Moved by Councilman Palmer that Resolution No. 239-84 be passed. Motion seconded by Councilman Harper, and carried by the following vote. Ayes: Mayor Cook, Councilmen Swift, Thomas, Harper, Wilson, Palmer, and Welburn Nays: None Item 5 Mr. Porter explained the resolution authorizing the establishment of an escrow agreement for the refunded water and sewer revenue bonds. RESOLUTION NO. 240-84 RESOLUTION AUTHORIZING AN ESCROW AGREEMENT BETWEEN THE CITY OF WICHITA FALLS, TEXAS, AND INTERFIRST BANK WICHITA FALLS, N.A. , WICHITA FALLS, TEXAS Moved by Councilman Thomas that Resolution No. 240-84 be passed. Motion seconded by Councilman Welburn, and carried by the following vote. Ayes: Mayor Cook, Councilmen Swift, Thomas, Harper, Wilson, Palmer, and Welburn Nays: None Councilman Wilson asked where they got the fee? Mr. Davis stated that Interfirst was very helpful in working with them to determine what the escrow fee will be. This fee includes not only their services in this initial refunding of the bonds, but in payment of the bonds in future years. It allows the City to recoup these costs. 609 Item 5, Cont'd. Councilman Harper commented that wha2L-1 they have done in the past month is an almost impossible task. Ken Smith, with Schneider, Bernet, and Hickman, stated that he appreciated working with Mr. Porter and Mr. Davis, and that it had been a pleasure to work with the Council on it. Item 6 was deleted. The meeting adjourned at 10:50 A.M. , into executive session, under Sub- section (e) of Section 2, of Article 6252-17, Revised Civil Statutes. If the work session is continued following the executive session, the press may come back in. It depends upon the hour. PASSED AND APPROVED this day of ,�� ,��� 1984. Craig A. Wilson, Mayor Pro tem ATTEST: Wilma J. Thomas, City Clerk