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