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1998R12- CREATION OF A NONPROFIT CORPORATION KESOI...UTlot'i AIo, 91-/-/ c7- RESOLUTION AUTHORIZING AND APPROVING THE CREATION OF A NONPROFIT CORPORATION TO ACT ON BEHALF OF THE CITY OF SCHERTZ, TEXAS; AND OTHER MATTERS IN CONNECTION THEREWITH WHEREAS, Subchapter D of Chapter 431 (Sections 431.101-431.109) of the Texas Transportation Code, as amended (the "Act") authorizes local governments to create local government corporations to aid, assist, and act on behalf of local governments; and WHEREAS, the City Council (the "Governing Body") of the City of Schertz, Texas (the "City") has reviewed and approved the Articles of Incorporation attached hereto and has determined to authorize and approve the creation of a local government corporation, a nonprofit entity, as its constituted authority and instrumentality to accomplish the specific public purpose of acquiring, constructing, leasing, improving, enlarging, extending, repairing, maintaining, and operating a water utility system (the "Project"), pursuant to the provisions of Chapter 402 of the Texas Local Government Code, a8 amended, and other applicable law; and WHEREAS, the Governing Body hereby finds and determines that the adoption of this Resolution is in the best interests of the citizens of the City; now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS THAT: Section 1. The Governing Body has found and determined, and hereby finds and determines, that it is advisable that a nonprofit corporation be authorized and created, with such corporation to be known as the "Schertz/Seguin Local Government Corporation" (the "Corporation"). Section 2, The Governing Body hereby approves the Articles ofIncorporation and Bylaws proposed to be used in organizing the Corporation (copies of which are attached to this Re80lution and made a part hereof for all purposes); hereby grants authority for the incorporation of the Corporation; and herebyappoint8 Ramon Cook and Jim Wo] verton as the initial directors of the Corporation to be appointed by the City. Section 3, The public purposes of the City which the Corporation may further on behalf of the City are acquiring, constructing, leasing, improving, enlarging, extending, repairing, maintaining, and operating a water utility sY8tem, pursuant to the provision8 of Texas law, including, but not limited to, Chapter 402 of the Texas Local Government Code, as amended, and other applicable law, and to take all lawful actions nece8sary or useful in furthering 8uch public purpose8. Section 4. The Corporation i8 hereby designated as the duly constituted authority and instrumentality of the City (within the meaning of those terms in the regulation8 of the Treasury and the rulings of the Internal Revenue Service pre8cribed and promulgated pursuant to Section 103 of the Internal Revenue Code of 1986, as amended) and shall be authorized to act on behalf of the 520301.2 -1- City for the specific public purposes set forth in Section 3 hereof; but the Corporation is not intended to be and shall not be a political subdivision or a political corporation within the meaning of the Constitution and the general laws of the State of Texas (the "State"), including without limitation Article III, Section 52 of the State Constitution, and the City does not delegate to the Corporation any of its attributes of sovereignty, including the power to tax, the power of eminent domain, or the police power. Section 5. The Corporation may, under the conditions set forth in the Act and in this Resolution, issue, or provide for the issuance of, bonds or notes on behalf of the City, acquire, lease, sell, or convey certain properties, and enter into purchase agreements, lease agreements, credit agreements, and all other agreements necessary or useful in connection with the Project. The City shall not lend its credit or grant any public money or thing of value in aid of the Corporation, Furthermore, bonds or notes issued by the Corporation shall be deemed not to constitute a debt of the State of Texas, the City, or of any other political corporation, subdivision, or agency of the State of Texas or a pledge of the faith and credit or taxing power of any of them, but such bonds or notes shall be payable solely from the revenues pledged to the payment of such bonds or notes. In no event shall the Corporation be authorized to levy ad valorem taxes to pay all or part of the principal of or interest on such bonds or notes, Section 6. Upon dissolution of the Corporation, the City shall accept (together with the City of Seguin, Texas on an equal basis) title to or other interest in any real or personal property owned by the Corporation at such time. Section 7. This Resolution is adopted for the purpose of satisfYing the conditions and requirements of the Act and of section 103 of the Internal Revenue Code of 1986, as amended, and the regulations prescribed thereunder from time to time and for the benefit of the Corporation, the City, the owners or holders from time to time of the bonds or notes of the Corporation, and all other interested persons. Section 8, The Governing Body authorizes the Mayor, or his designee, in consultation with legal counsel and the City's financial advisors to take all actions necessary to call and conduct the organizational meeting of the Corporation and to file, at the expense of the Corporation, any and all documents with the offices of the Secretary of State, the Comptroller of Public Accounts, and the United States Department of Treasury, as appropriate, to effectuate the creation and organization of the Corporation. Section 9. The recitals contained in the preamble hereof are hereby found to be true, and such recitals are hereby made a part of this Resolution for all purposes and are adopted as a part of the judgment and findings of the Governing Body. Section 10. All ordinances and resolutions, or parts thereof, which are in conflict or inconsistent with any provision of this Resolution are hereby repealed to the extent of such conflict, and the provisions of this Resolution shall be and remain controlling as to the matters ordained herein, 520301.2 -2- Section 11. This Resolution shall be construed and enforced in accordance with the laws of the State of Texas and the United States of America. Section 12. If any provision of this Resolution or the application thereof to any person or circumstance shall be held to be invalid, the remainder of this Resolution and the application of such provision to other persons and circumstances shall nevertheless be valid, and the Governing Body hereby declares that this Resolution would have been enacted without such invalid provision. Section 13. It is officially found, determined, and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place, and subject matter of the public business to be considered at such meeting, including this Resolution, was given, all as required by Chapter 551, as amended, Texas Government Code. Section 14. This Resolution shall be in force and effect from and after its final passage and it is so resolved. [The remainder of this page intentionally left blank] 520301.2 -3- PASSED AND APPROVED this the 1" day of December, 1998. ATTEST: ~/j~~ City Secretary (CITY SEAL) APPROVED AS TO FORM City Attorney 520301.2 Mayor -4- '62.