CITY OF LAREDO
                  CITY COUNCIL WORKSHOP REGARDING THE
                         FINANCING OF BRIDGE IV

                         CITY COUNCIL CHAMBERS
                              1110 HOUSTON
                             LAREDO, TEXAS
                               5:00 P.M.

                                MINUTES

     M98-W-08                                    FEBRUARY 23, 1998

   I.  CALL TO ORDER

       With a quorum present Mayor Elizabeth G. Flores called the meeting to
       order.

  II.  PLEDGE OF ALLEGIANCE

       Mayor Elizabeth G. Flores led in the Pledge of Allegiance.

 III.  ROLL CALL
       IN ATTENDANCE:
       ELIZABETH G. FLORES,    MAYOR
       JOSE. R. PEREZ, JR.,    COUNCILMEMBER, DISTRICT I
       LOUIS H. BRUNI,                "     , DISTRICT II
       CECILIA MAY MORENO,            "     , DISTRICT IV
       ELISEO VALDEZ,                 "     , DISTRICT V
       JOE A. GUERRA,                 "     , DISTRICT VI
       MARIO G. ALVARADO,             "     , DISTRICT VII
       CONSUELO "CHELO" MONTALVO,     "     , DISTRICT VIII
       GUSTAVO GUEVARA, JR.,   CITY SECRETARY
       FLORENCIO PENA, III,    CITY MANAGER
       JAIME L. FLORES,        CITY ATTORNEY

       ABSENCES:

       Motion to excuse Cm. Alfonso I. "Poncho" Casso.

       Moved : Cm. Guerra
       Second: Cw. Moreno
       For:  7                          Against:  0         Abstain:  0

  IV.  CITY MANAGER'S REPORT

       2. Discussion and possible action regarding the financing for the Laredo
          Northwest International Bridge (Fourth Bridge) and consideration of
          the City's loan application to the Texas Department of Transportation
          for State Infrastructure Bank Program Funds.

          Florencio Pena, City Manager, made the presentation and stated that
          this is the most important project that City Council has been involved
          over the last several years.  He read part of the correspondence from
          the United States Department of State.  He said that the first
          paragraph eludes to the fact that GSA has approved the Master Plan and
          read the second paragraph signed by Elizabeth Swope, Coordinator of
          U.S.-Mexico Border Affairs, for the record, which eludes to the issue
          they will be dealing and read as follows:

          "We have reviewed a copy of the 1995 Memorandum of
          Understanding between the City of Laredo and the State of Texas
          concerning funding of the bridge.  However, since these funds have not
          been appropriated, we will need information about current financial
          arrangements prior to exchanging Diplomatic Notes with Mexico
          authorizing construction.  We would also appreciate a clarification of
          the waiver referred to in your letter.

          In addition, we note that the construction schedule provided reflected
          actions taking place as early as the last week, February 1998.  Please
          provide a revised construction schedule reflecting current plans."

          Mr. Pena explained that in regards to the waiver it is unfortunate,
          but he has explained this waiver to Mrs. Swope in the past and it is
          unfortunate that she does not recall.  The waiver issue was the issue
          dealing with the limitation of the use of funds which the state has
          already resolved.  Instead of using innovative financing funds we are
          to use State infrastructure bank funds and that provision which
          required the exclusive use of surplus revenues to be designated over
          for highway projects has been eliminated, so the waiver issue is no
          longer an issue.  What is an issue is the submission of our financial
          arrangements.

          Jesse Covarrubias, Project Engineer, explained the plan on the
          proposed bridge site with road connections, interchanges, toll booths,
          inspection facilities, queuing stations for 310 trucks with the
          possibility to expand in the future for 220 tractors, and an overall
          view of the project and the layout of Master Plan for the bridge
          facility approved by GSA.

          Note:  Cm. Casso arrived at 5:35 p.m.

          Mr. Pena stated we could include an alternative bid to include the 220
          queuing area.

          Cindy Collazo gave an overview of the financing package that they
          propose to submit to the TxDot who will be financing a large portion
          of this project.  She presented construction funding sources
          comparison of City of Laredo and TxDot Proposals.  "Exhibit A"
          attached.

          Mr. Pena pointed that March 10 is the date to present the State
          Infrastructure Bank application to TxDot.

          Mr. Noe Hinojosa, Financial Advisor, gave an overview of the impact
          that this financial package will have on the city in terms of the
          general fund.  He presented financing options and went over the spread
          sheets.

                         CITY OF LAREDO, TEXAS
                 INTERNATIONAL FOURTH BRIDGE FINANCING

                               OPTION A                      OPTION B
   SOURCES:
   SIB Loan                   $24,870,000                       N/A
   Capitalized Interest         5,948,075                       N/A
   Tax Exempt (20 & 25 years)   3,910,000                   $29,115,000
   Taxable (20 years)           7,155,000                     7,155,000
                               ____________                 ___________
 Total                        $41,883,075                   $36,270,000

   USES:
   Construction Fund          $32,646,211                   $32,646,211
   Reserve Fund                 1,370,000                     1,365,000
   Contingencies                1,295,864                     1,126,581
   Cost of Issuance and Other     622,925                     1,132,208
                                ___________                 ___________
 Total                        $35,935,000                   $36,270,000

        IMPACT ON CITY
 Cost of Borrowing:                            Difference

 SIB Loan @ 4.1%              $16,706,522      16,706,522       N/A
 Tax Exempt @ 5.35% & 5.5%      2,585,565     (22,830,344)  $25,415,909
 Taxable @ 6.985%               6,469,688               0     6,469,688
                              ___________     ___________   ___________
 TOTAL                        $25,761,775      (6,123,822)  $31,885,597


 Average Contribution to Capital
  Improvements Fund (1999-2011)

                               $3,332,506         840,010   $2,492,496

Maximum FY 2000 & FY 2009      $4,685,331       1,618,028   $3,067,303

Minimum FY 2010                $1,247,804        (260,124)  $1,507,928


          Motion to authorize City Manager to submit application with option A
          for financing of Bridge IV.

          Moved : Cm. Perez
          Second: Cm. Valdez
          For:  8                       Against:  0         Abstain:  0


   V.  ADJOURNMENT

          Motion to adjourn.

          Moved : Cm. Perez
          Second: Cm. Bruni
          For:  8                       Against:  0         Abstain:  0

          Adjournment time:  6:25 p.m.


   I HEREBY CERTIFY THAT THE ABOVE MINUTES CONTAINED IN PAGE 01 TO 04
   ARE TRUE, COMPLETE, AND CORRECT PROCEEDINGS OF THE CITY COUNCIL WORKSHOP
   REGARDING THE FINANCING OF BRIDGE IV HELD ON THE 23RD OF FEBRUARY, 1998.  A
   CERTIFIED COPY IS IN FILE AT THE CITY SECRETARY'S OFFICE.


                                            ________________________
                                            GUSTAVO GUEVARA, JR.
                                            CITY SECRETARY