04-15-2010 MinutesMINUTES OF THE
SCHERTZ-SEGUIN LOCAL GOVERNMENT CORPORATION
THE STATE OF TEXAS §
COUNTY OF GUADALUPE §
SCHERTZ-SEGUIN LOCAL §
GOVERNMENT CORPORATION §
On this the 15th day of April, 2010, the Schertz-Seguin Local Government Corporation (SSLGC)
convened at 1:35 p.m. in the City of Seguin Council Chambers located at 210 E. Gonzales,
Seguin, Texas. The following members being present and in attendance:
Ken Greenwald
Robin Dwyer
Patricia Ramirez
Andrew Koenig
Jim Wolverton
Betty Ann Matthies
President
Vice-President
Secretary
Treasurer
Director
Ex-Officio
and the following director being absent:
Hal Baldwin Ex-Officio
constituting a majority of the persons appointed to the Board and a quorurn for the transaction of
business, and notice of such meeting having been duly given in accordance with the provisions
of Texas law. Also in attendance were:
Alan Cockerell
Doug Faseler
Don Taylor
Johnny Bierschwale
Susan Caddell
Georgia Hanks
Shawn Shimek
Emery Gallagher
Sam Willoughby
-- Patrick-L-indner
Bill Klemt
John Winkler
Crockett Camp
General Manager
City Manager of Seguin
City Manager of Schertz
Assistant City Manager of Schertz
Finance Director of Seguin
Administrative Assistant
Water System Superintendent
Seguin Water Utility Manager
Schertz Public Works Director
Legal COU11sel (Davidson & Troilo)
Hydrologist Consultant
COriSUltant (Walker Partners)
Consultant/Project Manager
The first order of business was the Calling of the Meeting to Order.
President Ken Greenwald called the meeting to order at 1:35 p.m.
The second order of business was Public Comment.
No one addressed the Board during public comment.
The third order of business was Approval of the Minutes for the Board Meeting held on
March 18, 2010.
Treasurer Andrew Koenig made a motion to approve the March 18, 2010 minutes as
written. Vice-President Robin Dwyer seconded the motion. Upon a vote being called, the
motion carried by unanimous decision.
The fourth order of business was Presentation of the General Manager's Report -Alan
Cockerell, General Manager.
General Manager Alan Cockerell's written report was included in the board agenda packets. He
highlighted the following items in his report:
Water Production
Water production for the month of March was 59.9% of SSLGC's monthly allowable as
mandated by the Gonzales County Underground Water Conservation District
(GCUWCD). The seasonal trend is as expected for this time of year. Mr. Cockerell
called attention to the seasonal pumping chart. The red line on the chart which is the
maximum amount of production allowed for each month was moved to illustrate the
150% maximum allowable per month according to GCUWCD's rule changes which were
approved at its March 16, 2010 meeting. The annual permitted amount remains at 12,910
ac-ft, but the 150% per month allows for more peaking capacity during the summer
months.
Region L
A Region L Public Hearing is scheduled April 15, 2010, at 7:00 p.m., at the San Marcos
Activity Center. Mr. Cockerell plans to attend the meeting which is being held for public
comment regarding Region L's 2011 Initially Prepared Plan.
GMA-13
A GMA-13 meeting was held April 9, 2010, in Pleasanton. A copy of Resolution No.
2010-1 regarding Desired Future Condition (DFC) Scenario 4 was included in the board
agenda packets. Scenario 4 was approved and is the highest pumping scenario with
additional pumping in Gonzales County. This scenario results in an average drawdown
of 23 ft. over the whole GMA for all eight layers included in the model.
• Guadalupe County
Mr. Cockerell attended a meeting April 8, 2010. Normal business was conducted. Mr.
Cockerell commented on the possible reduction in available water that can be produced
from the Carrizo Aquifer. According to information the District made available to GMA-
13, the amount of available water from the Carrizo Aquifer may change from 12,583 ac-ft
to 9,500 ac-ft. The previous allocated amount included production from the Carrizo in
Gonzales County and Wilcox production. Although the larger number may be reduced in
the future, at this time, the District has no plans to make changes to the current water
rights structure. The District does plan to consider charging a fee of one cent per 1,000
gallons for issued permits based on permit amount. The fee would be implemented with
newly acquired permits within the District and not affect SSLGC's current permits.
~ GCUWCD
Mr. Cockerell attended the monthly meeting held April 13, 2010. A copy of the agenda
was included in the board agenda packets. The District issued public notices regarding
historic use and well registration for existing wells. SSLGC has until June 2010 to
complete and submit its form for historic use permits. In order for landowners to receive
any form of mitigation, their wells have to be registered with GCUWCD by June 1, 2010.
Greg Sengelmann attended a Texas Alliance and Groundwater District meeting in Austin
the end of March. Comments were made at the meeting which suggest that authority
over groundwater in the state may be shifted from Groundwater Districts and GMA's to
other governing parties, possibly the state.
• Operations
Well #1 is out of service. SSLGC is working to have the well operational by the summer
months.
The fifth order of business was economists.com Proposal -Alan Cockerell, General
Manager.
A proposal by Dan Jackson with economists.com was included in the board agenda packets. Mr.
Jackson was one of the Corporation's expert witnesses during the SAWS hearing in Gonzales
County. He is familiar with SSLGC's water system and the executive committee and staff
recommend hiring him to review the Corporation's current rate structure and make
recommendations in regard to future negotiations with SAWS and other wholesale customers.
The analysis would be funded from the Corporation's Construction Fund. Mr. Cockerell
provided a brief summary of the proposal and asked for approval from the Board.
Vice-President Dwyer made a motion to approve the proposal from economists.com with
the fee not to exceed $15,000. Secretary Patricia Ramirez seconded the motion. Upon a
vote being called, the motion carried by unanimous decision.
The sixth order of business was Legislative Update -Alan Cockerell, General Manager.
Consultant Jack Fickessen was not present at the meeting in progress due to his participation at a
House Natural Resources Committee meeting in Austin. Mr. Cockerell listened to portions of
the meeting on-line earlier in the day. He reported that the committee was listening to
presentations from TCEQ, SAWS and the Water Development Board on the DFC process. Mr.
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Cockerell plans to attend the next public hearing of the House Natural Resources Committee on
April 29, 2010, and provide the committee with the Corporation's experiences with its specific
project and permitting process in Gonzales County.
The seventh order of business was Guadalupe County Expansion Proiect -Alan Cockerell,
General Manager.
Mr. Cockerell stated that John Winkler with Walker Partners is working to complete the final
design and construction plans for this project. Surveyors are currently completing topographical
surveys for collection lines. A list of the Corporation's current leased property in Guadalupe
County was included in the board agenda packets.
The eighth order of business was Authorization for the Staff and Financial Consultants of
SSLGC to Begin Preparation for the Bond Issue Associated with the Expansion of the
System and Make Presentation to the City Councils Regarding the Corporation's
Expansion and Financing Plans -Mark McLiney, Southwest Securities and Duane
Westerman, SAMCO.
Mr. Cockerell advised the Board that any discussion pertaining to the Corporation's pending
contracts would be deferred to Executive Session. He referred to several items which were
included in the board agenda packets:
o Timeline for the potential bond funding
o Figure 1 depicting a summary of various projects to expand SSLGC's system and costs
relating to the projects
o Summary of water lease payments from the year 2000 to an estimate for the year 2011 for
old Gonzales, new Gonzales and Guadalupe counties
Mr. Cockerell highlighted several activities in the timeline and provided a brief update regarding
the projects. He stated that SSLGC's June board meeting may be moved to June 15, 2010, in
order to coordinate meetings with the Schertz and Seguin City Councils to approve the bond sale.
SSLGC's financial advisors, Duane Westerman with SAMCO and Mark McLiney and Ryan
Cunningham with Southwest Securities, were introduced. Mr. Westerman presented information
regarding options for a bond issue of approximately $23.5 million and projected debt service
requirements for the expansion of SSLGC's system. At the end of his presentation he would ask
approval from the Board to proceed with the timeline in preparation for the bond issue. Towards
the end of Mr. Westerman's presentation, General Counsel Patrick Lindner recommended that
board members defer any action on the proposed bond issue and options regarding capitalized
interest until he could give legal advice in executive session. After a brief discussion, Mr.
Westerman concluded his presentation and stated that with the Board's approval, the financial
advisors would immediately move forward to compile official documents and statements to go
before the Schertz and Seguin city councils in order to obtain their approval for preparation of
the bond issue.
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Under the advice of Counsel, President Greenwald closed General Session to go into Executive
Session at 2: 08 p. m.
Executive Session was held from 2:09 p. m. until 2: 34 p. m.
President Greenwald reopened General Session at 2: 35 p. m.
For the record, President Greenwald stated that no action was taken during Executive Session.
As a result of Executive Session:
Vice-President Dwyer made a motion to approve authorization for staff and financial
consultants to begin preparation for the bond issue associated with the expansion of the
system. Treasurer Koenig seconded the motion. Upon a vote being called, the motion
carried by unanimous decision.
The ninth order of business was Gonzales County Expansion Proiect -Alan Cockerell,
General Manager.
President Greenwald deferred agenda item nine to Executive Session.
The tenth order of business was Lott Lease, Amendment No. 1-Patrick Lindner, General
Counsel.
President Greenwald deferred agenda item ten to Executive Session.
President Greenwald closed General Session at 2: 37 p. m.
The eleventh order of business was Executive Session called under Chapter 551
Government Code, Section 551.071, to seek the Advice of its Attorney on Legal Matters
and Section 551.072, for Deliberations Regarding Real Estate.
President Greenwald opened Executive Session at 2:42 p. m.
Executive Session was held from 2:42 p. m. to 3:13 p. m.
The twelfth order of business was to Consider and Take Action as a result of Agenda Item
Eleven.
President Greenwald reopened General Session at 3:13 p. m.
As a result of Executive Session:
Director Jim Wolverton made a motion to enter into the Lott Compromise and Settlement
Agreement and Amendment No. 1 to the Water Lease. Secretary Ramirez seconded the
motion. Upon a vote being called the motion carried by unanimous decision.
The thirteenth order of business was Consideration and/or Action on Questions and
Possible Items to be placed on the Next AEenda.
General Manager Cockerell stated that he along with SSLGC's financial advisors would be
making presentations to the Schertz and Seguin city councils on April 27 and May 4, 2010,
respectively. He invited board members to attend, although a quorum (more than two) could not
be present. President Greenwald said that he would attend. Mr. Cockerell plans to work with
Consultant John Winkler with Walker Partners and SSLGC's financial advisors in order to
present an overview of SSLGC's project and expansion plans to go along with the financial
advisors' summary of options for the bond issue at the city council meetings.
No additional discussion was held.
The next regular board meeting was scheduled May 20, 2010, at 1:30 p.m. in Schertz, Texas.
The board meeting June 2010 will be held on the 15th at 1:30 p.m. in Seguin, Texas.
The fourteenth order of business was Adjournment.
President Greenwald declared the meeting adjourned at 3:18 p.m.
MINUTES APPROVED THIS o~~ DAY OF , 2010.
Patricia Ramirez
Secretary