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Home My WebLink About1992-04-24 - Special City CouncilMINUTES OF SPECIAL MEETING City of Stephenville - City Council FRIDAY, APRIL 24, 1992 - 5:00 P.M. The City Council of the City of Stephenville, Texas, convened in spec- ial session on April 24, 1992 at 5:00 p.m., in the Council Chambers at City Hall, 354 N. Belknap, with the meeting being open to the public and notice of said meeting, giving the date, time, place and subject thereof, having been posted as prescribed by Article 6252-17, Section 3A, v.T.C.S., with the following members present, to wit: Mayor: George Swearingen Alan Nix na,,, �ELM4/J Sam Taylor II Ray Reynolds William F. (Bill) Johnson -late Lavinia Lohrmann Absent: Scott Evans and Jim Bostic Others Attending: Don Davis City Administrator Joyce Pemberton City Secretary I. Mayor George Swearingen called the meeting to order and declared a quorum present. II. DISCUSSION OF THE PALUXY RESERVOIR WATER RIGHTS. Mayor Swearingen advised that the City's attorney, Mike Willatt, was unable to attend the meeting; therefore, the Council would not go into executive session. n Mayor Swearingen explained that he felt it was important to brief the Council on the status of negotiations with the Somervell County water District. Because negotiations are on going, the Council cannot act on the final arrangements. He said that, basically, there are three issues that are presently being negotiated by the attorneys: 1) the capital cost for the construction of the reservoir, 2) the operations and maintenance expenses for the reservoir, and 3) the reimbursement that is to be made4 to the City of Stephenville for the expenses incurred in securing and litigating the water permit. As the first two items are still in negotiations, he did not feel is appropriate to discuss them at this time. The third item - the reimbursement to the City of Stephenville - has been tentatively agreed upon by both the Stephenville Water Planning Committee and the Negotiating Committee of the Somervell County Water District. Assuming this agreement is formally approved by both bodies, it will include payback of the permit expenses, plus interest, as follows: 1. 33 1/3% upon signing of the agreement 2. 41.7% amortized over 10 years (with the balance to be paid on commencement of construction, if the latter should occur before the expiration of 10 years) 3. 25% on commencement of construction r ! Stephenville's payments to date total $1,153,994.82. Mayor Swearingen asked Mr. Jim Shackleford, President of the Somervell County Water District, who was in the audience, if that was his understanding of the conceptual agreement? Mr. Shackleford answered "yes, it is." Mayor Swearingen said he felt it would be in order for the Council to discuss, and hopefully agree upon, the tentative - 170 - arrangements for reimbursing the City of Stephenville for the expenses incurred during this permitting process. Should the Council agree on this matter, Mr. Shackleford could then take it back to his Board of Directors and report of the Council' s agreement. Mayor Swearingen said "that in the legislation that created this water district it is written that Stephenville will transfer the water rights to the Somervell County Water District, to be admi- nistered by them at a certain time, before the finalization of this project they definitely have to be in control of that, in accordance with the legislation. Is that right, Jim?" f 1 Jim Shackleford replied "Yes, that's right. That's really the reason the District was created." Councilmember Lavinia Lohrmann asked how the lawsuit that's pending in Austin fit into this situation? Mayor Swearingen replied that right now, as you know, Stephenville is paying all the expense for litiagation. If when we transfer the water rights to the Water District, they will pick up the ball and run with it, whatever expenses there are. Am I correct, Jim? Mr. Shackleford replied "yes, that is exactly correct. Now, may I add one other thing? We would pick up all expenses involved with continuation of the process, the legal process, whatever that is, yes. Excuse me, I'll get back with the other part in a minute." Councilmember Lavinia Lohrmann asked should it be written as the oral decision was? Or are you speaking of an appeal? Or what? Don Davis, City Administrator, said that was one alternative. The oral judgement was that he was going to remand it back to the Water Commission. Obviously, either side could appeal his decision. Neither the Water District nor the City of Stephen- ville are parties in that suit. The suit is between the Texas Water Commission and the Texas Parks & Wildlife and some land- owners. Councilman Sam Taylor commented that what Mr. Shackleford was saying was that if that occurs and it is remanded back to the water Commission for repermitting or whatever the degree of re- doing has to be done at that level, once this contract is entered then the District begins picking up the expenses with that permit process. Mr. Shackleford said "Yes, the proposed contract, and of course, it has not been finalized yet, and we don't know all the fine tuning of it, but there will be a provision within this agree- ment that will specify that the Water District will start assuming all legal costs at the time the transfer is made. So that would include an appeals process or whatever. If it is not appealed and the decision is favorable to us and we go for- ward and its not appealed, great. We will include that as a provision of the agreement... that we will accept the cost. Mrs. Lohrmann said the basic byline of her questioning is, what if in fact the courts do not allow the building of this reservoir and the payment is hinged on the "beginning of construction". Sam Taylor replied that only 25% of it is hinged upon construc- tion beginning. We get 33 1/3 of the total expenses reimbursed the minute we sign the contract, whether its next week or the week after and then 41.7% is reimbursed regardless of whether construction begins or not over ten years, with interest, re- gardless of whether construction begins. He said that it is important to emphasize that with regard to this part that we are addressing today, reimbursement of 75% of the expenses occurs whether or construction ever begins or not. - 171 - Councilman Alan Nix asked if Mr. Shackleford had anything else he would like to say. n PC Mr. Jim Shackleford replied "Yes, I finally thought of what I was going to say a while ago and I would like to add this because I think it is a pertinent point. We had this same sort of discussion with the City of Glen Rose and Somervell County and, in those agreements with those two entities, there is a provision which says that the final transfer of their water rights to the Water District will take place at the time that the granting of water rights to them becomes final and that doesn't become final, of course, until its out of the court's hands and the same provision will be included in the Stephenville agreement. So your final act of transfer of water rights will take place at the time that you have final uncon- tested rights. Right now you have only contested rights." Councilman Ray Reynolds made the motion that the City Council tentatively approve the agreement for reimbursement of our cost from Somervell County Water District, and as part of that, since I've been involved in this for a number of years, I would like to express my appreciation to the water Planning Committee of Alan, Sam, Scott and Chairman, George Swearingen, for the work they have done on this to get to the point where I think it is an agreement that is very satisfactory and it gets our money reimbursed. I appreciate the work. Councilman Sam Taylor made the second. The motion carried by the following vote: AYES: Councilmembers Alan Nix, Don Zelman, Sam Taylor, Ray Reynolds, Bill Johnson and Mayor George Swearingen. NOES: None ABSTAIN: Councilmember Lavinia Lohrmann ABSENT: Councilmembers Scott Evans and Jim Bostic. There being no other business to come before the Council at this time, Mayor Swearingen adjourned the meeting at 5:30 p.m. ATTEST: yc em�on, City Secretary GeoW Swearingen, M yor - 172 -