September 24, 2018 REGULAR MEETING OF THE CITY COUNCIL OF TFiE
CITY OF NEDERLAND
4:30 P.m_ September 24, 2018
1_ MEETING
The meeting was called to order at 4:30 p.m. by Mayor Nugent at the Nederland City
Office Building, 207 N. 12'" Street, Nederland, Texas. See attached for quorum.
The following statement was posted:
"PIJRSIJANT TO SECTION 30.07, PENAL CODE (TRESPASS BY LICENSE HOLDER
WITH AN OPENLY CARRIED HANDGIJ143, A PERSON LICENSED UNDER
SUBCHAPTER H, CHAPTER 411, GOVERNMENT CODE (MANUGUN LICENSING
LAW), MAY NOT ENTER THIS PROPERTY WITH A HANDGUN THAT IS CARRIED
OPENLY_"
2. INVOCATION AND PLEDGE OF ALLEGIANCE
The invocation and pledge of allegiance were led by Gay Ferguson, City Clerk.
3. CONSENT AGENDA - All consent agenda items listed are considered to be routine by
the City Council and will be enacted by one motion. There will be no separate
discussion of these items unless a councilmember so requests, in which event the item
will be removed from the Consent Agenda and considered separately.
A motion was made by Councilmember Neal and seconded by Mayor Pro Tem Albanese
to approve the Consent Agenda Items a-c as presented. MOTION CARRIED_
Ayes: Mayor Nugent, Councilmembers Austin, Neal, Albanese, and Belaire.
Noes: None.
a. August 2018 Departmental Reports
b. Tax Assessor Collection Report - August 2018
c. Requests:
• Consider action authorizing the closure of Street from Nederland Avenue to
Atlanta Avenue on Wednesday, October 31" for the Seventh Street Baptist
Church Block Party.
• Consider action authorizing the closure of Boston Avenue between Twin City
Highway and 14t^ Street on Saturday, October 20'' for the Fall Market may
event.
wimommilor
Minutes Continued, September 24, 2018
4. REGULAR AGENDA
a. A motion was made by Mayor Pro Tern Albanese and seconded by Councilmember
Austin to accept the quarterly Hotel Occupancy Tax Fund financial reports from the
Nederland Historical Society. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
b. Rob Woods, Director of Public Works; and Rick Bourque, Schaumburg & Polk, Inc.,
provided an update on the Nederland Avenue Paving and Drainage project. A
schedule was handed out which reflected some adjustments. Milling has begun on
the second phase of the project. Rain is predicted for the rest of the week so
surface treatment will be pushed to next week. Mr. Bourque stated they anticipate
less base repairs in the 2nd phase and the goal for completion of the project is
around Thanksgiving. He said there may still be some minor work after that
deadline but the project will be substantially complete.
c. A motion was made by Councilmember Austin and seconded by Mayor Pro Tem
Albanese to approve a request from Nederland ISD to utilize the Nederland
Recreation Center as a secondary evacuation location for Hillcrest Elementary
School. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
d. A motion was made by Mayor Pro Tem Albanese and seconded by Councilmember
Austin to approve the Marion & Ed Hughes Public Library Strategic Plan and
Technology Plan. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
e. Appointments:
i. A motion was made by Councilmember Neal and seconded by Councilmember
Austin to re-appoint Sylvia Root and Mike Roebuck to the Nederland Economic
Development Corporation Board of Directors. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
ii. A motion was made by Councilmember Neal and seconded by Councilmember
Austin to appoint Don Albanese and Stuart Kieschnick to the Nederland Economic
Development Corporation Board of Directors. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, and Belaire.
Noes: None.
Abstain: Mayor Pro Tem Albanese.
f. A motion was made by Mayor Pro Tern Albanese and seconded by Councilmember
Neal to approve Ordinance No. 2018-27, approving the settlement filed in Entergy
Texas, Inc.'s rate proceeding initiated on May 15, 2018. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
g. Chris Duque, City Manager, read the caption of Ordinance No. 2018-20, regarding
granting a franchise agreement with Texas Gas Company.
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Minutes Continued, September 24, 2018
A motion was made by Councilmember Austin and seconded by Councilmember
Neal to postpone action on Ordinance No. 2018-20, granting a franchise agreement
with Texas Gas Company. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
h. A motion was made by Mayor Pro Tem Albanese and seconded by Councilmember
Austin to approve reimbursing EMHUGH, Ltd. For property damage related e to the
City's recycling drop-off center at the Market Basket property.
ON
CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
i. James Gilly, Jr. with US Capital Advisors reported the bonds were offered and 6
bidders submitted very competitive offers. The lowest was Piper Jaffray with a rate
of 3.243845 percent. He commended the city for its budgetary and financial
policies that allowed the Standard and Poor's rating to remain at AA.
A motion was made by Mayor Pro Tem Albanese and seconded by Councilmember
Neal to approve Ordinance No. 2018-28, authorizing the issuance of City of
Nederland, Texas, Tax and Revenue Certificates of Obligation, Series 2018.
MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, and Albanese.
Noes: None.
Abstain: Councilmember Belaire.
j. A motion was made by Councilmember Austin and seconded by Councilmember
Neal to approve Resolution 2018-14, providing written consent to the petition to
include additional land in Jefferson County Water Control and Improvement District
10. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
k. Budget:
i. A motion was made by Councilmember Austin and seconded by Mayor Pro Tern
Albanese to approve Ordinance No. 2018-29, amending the fiscal year 2017-2018
budget. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
ii. A motion was made by Mayor Pro Tern Albanese and seconded by
Councilmember Austin to approve Ordinance No. 2018-30, declaring certain utility
accounts as uncollectable. MOTION CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
iii. A motion was made by Councilmember Austin and seconded by Councilmember
Neal to approve Ordinance No. 2018-31, utility rates and regulations. MOTION
CARRIED.
Ayes: Mayor Nugent, Councilmember Austin, Neal, Albanese, and Belaire.
Noes: None.
I.
Minutes Continued, September 24, 2018
5. COMMUNICATION
City Manager's Report:
a. Miscellaneous:
• October Th - City will be hosting the Chamber Coffee at the Public Safety
Building
• Trunk R Treat will be on Halloween and police and fire will be handing out
candy.
6. ADJOURN
There being no further business a motion was made by Mayor Nugent and
seconded by Councilmember Austin to adjourn the meeting at 5:43 p.m. MOTION
CARRIED.
Ayes: Mayor Nugent, Councilmembers Austin, Neal, Albanese, and Belaire.
Noes: None.
�IAND ;
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q)). _ ' R. A.
. Nugent ayor
. City of Nede nd, Te
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.
AYE OUN\\
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A/ WA _/ I At
ay Fergus.", City Clerk
City of Nederland, Texas
CITY OF NEDERLAND
COUNCIL MEETING ATTENDANCE SHEET
NAME TITLE PRESENT ABSENT
Mayor R.A. Nugent Ma Y /
\.7
Talmadge Austin Council Member—Ward I v
Billy Neal Council Member—Ward II V/
Don Albanese
Council Member—Ward III V
\/
Craig Belaire Council Member—Ward IV
Chris Duque City Manager V
Gay Ferguson City Clerk V
Jesse Branick City Attorney
Cheryl Dowden Director
ry of Finance V, /
Gary Porter Police Chief V
ActingFire Chief V
k/Terry Morton
Robert Woods Director of Public Works
George Wheeler Building Official
Victoria Klehn Librarian
Holly Guidry Human Resources Director ✓
V
Joni Underwood Executive Secretary
1/7
Angela Fanette Parks Director
AG
R. •. Nugent, f=yor
41 'i II . iii
',ay Fer4�son, City CI=1k
September 24, 2018
Date
rr►
ALLISON NATHAN GETZ �d1, �) TERRY WUENSCHEL
TAX ASSESSOR-COLLECTOR I" , �. CHIEF DEPUTY
* /
\ •
�?'EXA��'/
STATE OF TEXAS
COUNTY OF JEFFERSON
I, Allison Nathan Getz, P.C.C., the Tax Assessor-Collector of Jefferson County, Texas and
also, by contract or statute, the Tax Assessor-Collector for CITY OF NEDERLAND, affirm, under
oath, that this amount $33,399.30, represents all taxes collected for CITY OF NEDERLAND
during the month of August 2018.
r'1
Allison Nathan Getz, P.C.C.
JEFFERSON COUNTY COURTHOUSE •P.O. BOX 2112 •BEAUMONT,TEXAS 77704-2112
PHONE: (409)835-8516 • FAX: (409)835-8589
RESOLUTION NO. 2018-14
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
NEDERLAND, TEXAS GRANTING ITS CONSENT TO A
PETITION BY LSP HIGHWAY 347, LLC FOR THE ADDITION
OF 97.11 ACRES OF LAND TO THE JEFFERSON COUNTY
WATER CONTROL AND IMPROVEMENT DISTRICT NO. 10
WITHIN THE CITY OF NEDERLAND'S AND CITY OF
BEAUMONT'S EXTRATERRITORIAL JURISDICTION
WHEREAS, the owner, LSP Highway 347, LLC, of 97.11 acres of land (the
"land") and Jefferson County Water Control and Improvement District No. 10 (the
"District") have submitted a petition (the "petition") for the addition of the land to
the District a copy of which is attached hereto and labeled Exhibit"A"; and
WHEREAS, the District is a political subdivision providing water and sanitary
sewer services within the extraterritorial jurisdiction of the City of Nederland (the
"City"); and
WHEREAS, the land described in the petition is located within the
extraterritorial jurisdiction of the City of Nederland and of the City of Beaumont and
a portion of the land is located within the Nederland city limits; and
WHEREAS, Section 42.0425 of the Texas Local Government Code provides
that land may not be added to political subdivisions providing water and sanitary
sewer services within the extraterritorial jurisdiction of the City unless the City grants
its written consent by resolution or ordinance and provides that the City's written
consent may include certain conditions;
NOW,THERFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF NEDERLAND,TEXAS:
SECTION 1.That subject to the provisions of this Resolution, the City Council
gives its written consent for the "District"to annex a 97.11 acre
tract, as described in the petition attached as Exhibit A.
SECTION 2.That the City's consent is conditioned upon the following: (1) the
District's bonds and debt shall be and remain obligations of the
District and (2) the District's bonds and debt shall not affect the
City of Nederland's ability to issue debt.
PASSED AND APPROVED this 24"day of SEPTEMBER, 2018.
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}I� 1.3.1= R.A."Dick" 1' gent,Mayor
1t / /.1 #AI //
gay Fergu'on,City Cler"
APPROVED AS TO FORM AND LEGALITY:
Jesse -ranick "y Attorney
City • Ne. rland,Texas
1
EXHIBIT A
�r►
PETITION FOR CONSENT TO INCLUDE ADDITIONAL
LAND IN JEFFERSON COUNTY WATER CONTROL AND
IMPROVEMENT DISTRICT NO. 10
THE STATE OF TEXAS §
COUNTY OF JEFFERSON §
TO THE HONORABLE MAYOR AND
CITY COUNCIL OF THE CITY OF NEDERLAND:
LSP Highway 347 LLC,a Texas limited liability company,being the holder of title to all
of, and therefore, a majority in value of the land hereinafter described, as such values are
indicated by the tax rolls of the central appraisal district of Jefferson County, Texas
("Landowner"), and Jefferson County Water Control and Improvement District No. 10
("District") (Landowner and District hereinafter called "Petitioner"), acting pursuant to the
provisions of Section 42.0425,Texas Local Government Code,as amended,respectfully petition
for consent to include additional land in a water control and improvement district. In support of
this petition,Petitioner shows as follows:
The District,to which the land hereinafter described is sought to be annexed,exists under
the terms and provisions of Article XVI,Section 59 of the Constitution of Texas and Chapters 49
and 51,Texas Water Code,as amended. Landowner is the sole owner and holder of fee simple
title to the land sought to be annexed to the District, as indicated by the tax rolls of the central
appraisal district of Jefferson County,Texas. Landowner represents and warrants that there are
no holders of liens against said land.
II.
The land sought to be added to the District contains approximately 97.11 acres of land,
more or less,and lies wholly within Jefferson County,Texas. No part of said area is within the
limits of any incorporated city or town. Under the provisions of Section 42.001, Local
Government Code,as amended,said area is within the extraterritorial jurisdiction of the Cities of
Nederland and Beaumont,Texas and is not within such jurisdiction of any other city. All of the
territory to be annexed may properly be annexed to the District.
III.
The land sought to be added to the area of the District is described by metes and bounds
in Exhibit"A"attached hereto and incorporated herein for all purposes.
IV.
The general nature of the work proposed to be done in the area sought to be annexed shall
be the purchase,construction,acquisition,repair,extension and improvement of land,easements,
works,improvements,facilities,plants,equipment and appliances necessary to:
(1) provide a water supply for municipal,domestic and commercial purposes;
(2) collect, transport, process, dispose of and control all domestic, industrial or
communal wastes whether in fluid,solid or composite state;
(3) gather,conduct,divert and control local storm water or other harmful excesses of
water in the area;and
(4) provide, operate and maintain a fire department and/or firefighting services
("firefighting-facilities")within the area.
V.
The area of the District is urban in nature, is within the growing environs of the City of
Nederland, and is in close proximity to populous and developed sections of Jefferson County.
There is a necessity for the improvements described above because the land sought to be added to
the District is not supplied with adequate water, sanitary sewer, drainage or fire-fighting
facilities, nor is it presently economically feasible for such facilities to be added to said land.
The health and welfare of the present and future inhabitants of the District,the land sought to be
added to the District,and of territories adjacent thereto require the installation and acquisition of
adequate water,sanitary sewer,drainage and fire-fighting facilities for and within the land sought
to be added to the District.
A public necessity exists for the addition of said lands to the District to promote and
protect the purity and sanitary condition of the State's waters and the public health and welfare of
the community, by and through the construction, extension, improvement, maintenance and
operation of water,sanitary sewer,drainage and fire-fighting facilities.
WHEREFORE, Petitioner respectfully prays that this petition be granted in all respects
and that the City of Nederland give its consent to the annexation of the aforesaid land into said
District.
-2-
LSP HIGHWAY 347 LLC,
a Texas limited liability company/
By: ( +('if {( �' 1 ✓-1;4: 1
Nam : Rob t H.Chandler
Title: Manager
THE STATE OF TEXAS §
COUNTY OF JEFFERSON §
This instrument was acknowledged before me on this 18th day of June,2018,by Robert
H.Chandler,Manager of LSP HIGHWAY 347 LLC,a Texas limited liability company,on behalf
of said limited liability company.
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Liu.4
Notary Public in and for -
State of Texas
(SEAL) .0.2. BRENDA G RATUFF
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NryID13944637
O `VApr 29,
My mission Expires
344075.1
-11-
IIIIL
EXHIBIT A
Legal Description of the Property
TRACT I:
BEING 96.33 acres of land out of and a part of Tract 1II,Walker-Arena Hwy 347, recorded
in File No. 2015010541, Official Public Records, Jefferson County, Texas, part of the
Pelham Humphries Survey, Abstract No.32,and part of the J. S. Johnson Survey Abstract
No. 34,Jefferson County.Texas; said 96.33 acre tract being more fully described by metes
and bounds as follows,to wit:
Note: Bearings, coordinates, distances and acreage are based on the Texas Coordinate
System of 1983, South Central Zone. US Survey Feet,and are referenced to SmartNet,North
America.
COMMENCING at a brass disk found in concrete for the Northeast corner of Tract IV of
said Walker-Arena Hwy 347 plat; said brass disk being on the Southwesterly right of way
line of a dedicated road named State Highway 347,a.k.a.Twin City Highway,and Southeast
corner of a (Called 7.595) acre tract of land described in a deed to E. 1. DU PONT DE
NEMOURS & COMPANY, recorded in Volume 845, Page 48, Deed Records, Jefferson
County,Texas;having a Texas Coordinate of N: 13948890.88,E:3538794.39;
THENCE, South 51 deg., 35 min., 00 sec., East(Called South 51 deg., 35 min., 09 sec.,
East), on the Southwesterly right of way line of said State Highway 347, a distance of
884.61'to a 1/2"steel rod,capped and marked"SOUTEX",found for the Southeast corner of
a (Called 10.83) acre tract of land described in a deed to Triangle Waste Properties, LP,
recorded in File No.2017034093,Official Public Records,Jefferson County,Texas;said
steel rod being the most Easterly Northeast corner of the herein described tract; having a
Texas Coordinate of N: 13948341.61,E:3539487.42;
THENCE, South 51 deg., 35 min., 11 sec., East (Called South 51 deg., 35 min., 09 sec.,
East), continuing on the Southwesterly right of way line of said State Highway 347, a
distance of 315.82' passing a 5/8"steel rod,capped and marked"JAMA GROUP",found for
a common corner of said Tract III and a(Called 61.526)acre tract of land described in a deed
to Walker-Arena Land Holdings, LLC, recorded in File No. 2013040591, Official Public
Records,Jefferson County,Texas,continuing for a total distance of 1566.46'to a 5/8"steel
rod found in concrete for the Northeast corner of a(Called 2.000)acre tract of land described
in a deed to 347 Partners, LTD, recorded in File No. 2008004217,Official Public Records,
Jefferson County,Texas;said 5/8"steel rod being the most Southerly Southeast corner of the
herein described tract;
THENCE, South 39 deg., 08 min., 50 sec., West, on the North line of said 347 Partners,
LTD tract,the North line of a(Called 2.536) acre tract of land described in a deed to 347
-5-
Partners, LTD tract, recorded in File No. 2008004808, Official Public Records, Jefferson
County,Texas,the North line of a(Called 5.00)acre tract of land described in a deed to Kerr
Enterprises, Inc., recorded in File No. 2002005775, Official Public Records, Jefferson
County,Texas,and the North line of a(Called 60.136)acre tract of land described in a deed
to Lower Neches Valley Authority, recorded in File No. 2007001740, Official Public
Records, Jefferson County, Texas, a distance of 2133.51' to a 'A" steel rod found for the
Northwest corner of the(Called 60.136)acre tract on the Northeasterly line of a 100' wide
Gulf States Utilities Company right of way, recorded in Volume 370, Page 38, Deed
Records,Jefferson County,Texas;said'''"steel rod being the Southwest corner of the herein
described tract;
THENCE, North 52 deg., 25 min., 26 sec., West (Called North 52 deg., 25 min., 13 sec.,
West), on the Northeasterly line of said Gulf States Utilities Company right of way, a
distance of 1251.26' passing a 5/8" steel rod,capped and marked"JAMA GROUP", found
for a common corner of said Tract III and the (Called 61.526) acre tract,continuing for a
total distance of 2452.63'to a 5/8"steel rod,capped and marked"JAMA GROUP",found on
the Southeasterly line of the (Called 7.595) acre tract; said 5/8" steel rod being the most
Northerly Northwest corner of the herein described tract;
THENCE, North 39 deg., 19 min., 32 sec., East (Called North 39 deg., 09 min., 39 sec.,
East), on the South line of the(Called 7.595)acre tract,a distance of 242.42' to a /2" steel
rod, capped and marked "SOUTEX", found for the most Westerly corner of a (Called
0.5602) acre tract of land recorded as a Non-Exclusive Access and Utility Easement,
recorded in File No.2015017352,Official Public Records,Jefferson County,Texas;said%2"
steel rod being an angle point on the Northwesterly line of the herein described tract;
THENCE, South 50 deg., 54 min., 40 sec., East, on the Southwesterly line of the (Called
0.5602) acre tract,a distance of 59.88' to a %2"steel rod,capped and marked"SOUTEX",
found for the most Northerly Northwest corner of Tract II of said Walker-Arena Hwy 347
tract;said'/"steel rod being an angle point on the Northwesterly line of the herein described
tract;
THENCE, South 50 deg., 48 min., 57 sec., East (Called South 50 deg., 50 min., 21 sec.,
East),on the Southwesterly line of said Tract II,a distance of 466.75' (Called 466.69') to a
'/2'' steel rod, capped and marked "SOUTEX",found for the most Southerly corner of said
Tract II;
THENCE, North 39 deg., 09 min.,23 sec., East(Called North 39 deg., 09 min., 41 sec.,
East),on the Southeasterly line of said Tract II and Tract I of said Walker-Arena Hwy 347
plat, a distance of 933.68' to a 'A"steel rod,capped and marked"SOUTEX",found for the
most Easterly corner of said Tract I;
THENCE, North 50 deg., 50 min., 35 sec., West(Called North 50 deg., 50 min., 21 sec.,
West),on the Northerly line of said Tract I,a distance of 466.53' (Called 466.69') to a %2"
steel rod,capped and marked"SOUTEX'',found for the most Northerly corner of said Tract
I: said `/" steel rod being on the Southerly line of a (Called 2.544) acre tract of land
-6-
described as an Easement Estate for Access and Utilities to serve Tracts II through IV,
recorded in File No.2015013861,Official Public Records,Jefferson County,Texas;
THENCE, North 39 deg., 10 min., 06 sec., East (Called North 39 deg., 09 min., 41 sec.,
East), on the Southerly line of the (Called 2.544) acre tract, a distance of 294.89' (Called
294.82')to a'/"steel rod,capped and marked"SOUTEX",found for corner;
THENCE,continuing on the Southerly right of way line of the(Called 2.544)acre tract on
the arc of a curve to the right having a radius of 240.00', an arc length of 68.16', a chord
bearing of North 46 deg.,53 min.,31 sec.,East,a chord distance of 67.93'to a Y2"steel rod,
capped and marked"SOUTEX", found for the most Westerly corner of the (Called 10.38)
acre tract;said%2"steel rod being the most Northerly corner of the herein described tract;
THENCE, South 50 deg., 50 min., 41 sec., East, on the Southwesterly line of the (Called
10.33) acre tract, a distance of 814.67' to a ''/2" steel rod, capped and marked "SOUTEX",
found for the most Southerly corner of the(Called 10.83)acre tract;
THENCE, North 39 deg., I 1 min., 11 sec., East, on the Southeasterly line of the (Called
10.83) acre tract, a distance of 642.67' to the POINT OF BEGINNING and containing
96.33 acres of land,more or less.
TRACT II:
Tract Number IV,of WALKER-ARENA HIGHWAY 347,a subdivision in Jefferson County,Texas
as the same appears upon the map or plat thereof,on file and or record under County Clerk's File
No.2015010541,Official Public Records of Jefferson County,Texas.
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ORDINANCE NO.2018-27
AN ORDINANCE BY THE CITY COUNCIL OF THE CITY OF
NEDERLAND, TEXAS ("CITY") APPROVING THE SETTLEMENT
FILED IN ENTERGY TEXAS,INC.'S RATE PROCEEDING INITIATED
ON MAY 15, 2018; FINDING THAT THE MEETING COMPLIES
WITH THE OPEN MEETINGS ACT; MAKING OTHER FINDINGS
AND PROVISIONS RELATED TO THE SUBJECT;AND DECLARING
AN EFFECTIVE DATE
WHEREAS, on or about May 15, 2018 Entergy Texas, Inc. ("ETI" or "Company")
filed a Statement of Intent with the City to increase electric rates in its service area by
$117.5 million per year;and
WHEREAS,ETI proposed to offset the first two years of the rate increase by about
$100.8 million per year for income taxes that it over-collected as a result of the Tax Cuts
and Job Act of 2017("TCJA");and
WHEREAS, the City suspended the effective date of ETI's rates within its
jurisdictional limits until September 17,2017,and retained the Lawton Law Firm,P.C.to
review the Company's rate change request and proposed tariffs;and
WHEREAS,the City denied ETI's rate request on September 10,2018;and
WHEREAS, concurrently with its filing with the City, the Company filed its
Statement of Intent with the Public Utility Commission of Texas("PUC"or"Commission")
on May 15,2018,under Docket No.48371;and
WHEREAS,the City intervened in Docket No.48371 at the Commission along with
other cities pursuant to the Public Utility Regulatory Act("PURA")§33.025;and
WHEREAS,ETI,PUC Staff,and other intervening parties participating in Docket No.
48371 have reached a settlement of ETI's base rate increase request;and
WHEREAS, the settlement authorizes a $53.2 million increase to ETI's current
adjusted revenues;and
WHEREAS, the settlement provides that ETI will return to customers
approximately$205 million(including interest)in excess deferred tax savings that accrued
pursuant to the TCJA;and
WHEREAS,the settlement provides that ETI will return to customers$25 million
for tax over-collections in 2018 as a result of the TCJA;and
WHEREAS,over the first four years rates are in effect, Residential customers will
experience a $2.9 million annual decrease compared to current rates, Small General
Service customers will receive a$1.3 million annual increase,and Street Lighting rates will
decrease by about $900,000 per year. The impact on the remaining rates classes will
average out to a$3.6 million annual decrease for General Service customers,a$700,000
annual increase for Large General Service customers,and a$1.1 million annual increase
for Large Industrial Power Service customers;and
WHEREAS,having reviewed the Company's rate change request and the terms of
the proposed settlement, the Lawton Law Firm has recommended approval of the
settlement agreement;and
WHEREAS, settlement of the case will reduce the risk of an unanticipated or
negative outcome and will also reduce litigation expenses;and
1
WHEREAS,the settlement will result in a just and reasonable outcome and is in
the public interest.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
NEDERLAND,TEXAS,THAT:
Section 1. That the statement and findings set out in the preamble to this
Ordinance are hereby in all things approved and adopted.
Section 2. The settlement agreement proposed in PUC Docket No. 48731 is
approved.
Section 3. The meeting at which this ordinance was approved was in all things
conducted in strict compliance with the Texas Open Meetings Act,
Texas Government Code,Chapter 551.
Section 4. This ordinance shall become effective from and after its passage.
PASSED AND APPROVED this 24TH day of SEPTEMBER,2018.
# 14
Mayor R9'Dick"Nugent
mit' . alei A/ _.i A/�
Gay Fergus 1 ,City Cler 1
e a, cialfrphynev
2
Ordinance Number a01%—a3
AN ORDINANCE
AUTHORIZING THE ISSUANCE OF
CITY OF NEDERLAND, TEXAS,
TAX AND REVENUE CERTIFICATES OF OBLIGATION,
SERIES 2018;
AND LEVYING AN AD VALOREM TAX;
PLEDGING CERTAIN NET REVENUES; AUTHORIZING
THE EXECUTION OF A TRANSFER AND
PAYING AGENCY AGREEMENT;
AND OTHER MATTERS IN CONNECTION THEREWITH
CITY OF NEDERLAND,TEXAS
ADOPTED September 24, 2018
56432017.1
TABLE OF CONTENTS
Page
ARTICLE ONE
THE CERTIFICATES
SECTION 1.1 Authorization and Terms; Purpose 2
SECTION 1.2 Redemption 3
SECTION 1.3 Execution,Registration, Delivery, and Dating 5
SECTION 1.4 Registration, Transfer, and Exchange 6
SECTION 1.5 Mutilated, Destroyed, Lost, and Stolen Certificates 7
SECTION 1.6 Persons Deemed Owners 7
SECTION 1.7 Cancellation 7
SECTION 1.8 Book-Entry Only 8
ARTICLE TWO
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 2.1 Definitions 9
SECTION 2.2 Notices 13
SECTION 2.3 Effect of Headings and Table of Contents; Recitals 13
SECTION 2.4 Ordinance a Contract; Amendments 13
SECTION 2.5 Benefits of Ordinance 14
SECTION 2.6 Repealer 14
SECTION 2.7 Governing Law 14
SECTION 2.8 Severability 14
SECTION 2.9 Public Meeting 15
SECTION 2.10 Authority of Officers 15
ARTICLE THREE
FORMS
SECTION 3.1 Forms Generally 16
SECTION 3.2 Form of Definitive Certificate 17
SECTION 3.3 Form of Registration Certificate of Comptroller of Public Accounts 23
SECTION 3.4 Form of Certificate of Paying Agent 23
SECTION 3.5 Form of Assignment 24
SECTION 3.6 Form of Initial Certificate 24
SECTION 3.7 Insurance Legend 25
ARTICLE FOUR
TAXES, REVENUES,AND FUNDS; INVESTMENTS
SECTION 4.1 Certificate Fund 26
SECTION 4.2 Deposits to Certificate Fund; Excess Certificate Proceeds 26
SECTION 4.3 System Account 26
SECTION 4.4 Construction Accounts 27
SECTION 4.5 Investments and Security For Funds 27
SECTION 4.6 Tax Levy 27
56432017.1 1
TABLE OF CONTENTS
Page
SECTION 4.7 Net Revenues 28
SECTION 4.8 Issuance of Additional Obligations 29
ARTICLE FIVE
COVENANTS
SECTION 5.1 To Maintain Agency 30
SECTION 5.2 To Maintain and Operate the System and Insure Property 30
SECTION 5.3 Rates and Charges 31
SECTION 5.4 Records and Accounts,Annual Audit 31
SECTION 5.5 Special Covenants 31
SECTION 5.6 Covenants to Maintain Tax-Exempt Status 32
SECTION 5.7 Remedies in Event of Default 35
ARTICLE SIX
DEFEASANCE
SECTION 6.1 Discharge of Obligations 36
ARTICLE SEVEN
SALE
SECTION 7.1 Sale of the Certificates 38
SECTION 7.2 Payment of Costs of Issuance; Engagement of Bond Counsel 38
SECTION 7.3 Official Statement 38
ARTICLE EIGHT
CONTINUING DISCLOSURE UNDERTAKING
SECTION 8.1 Definitions 39
SECTION 8.2 Updated Information and Data 39
SECTION 8.3 Material Event Notices 40
SECTION 8.4 Limitations, Disclaimers, and Amendments 41
56432017.1 11
AN ORDINANCE
AUTHORIZING THE ISSUANCE OF
CITY OF NEDERLAND,TEXAS,
TAX AND REVENUE CERTIFICATES OF OBLIGATION,
SERIES 2018;
AND LEVYING AN AD VALOREM TAX;
PLEDGING CERTAIN NET REVENUES; AUTHORIZING
THE EXECUTION OF A TRANSFER AND
PAYING AGENCY AGREEMENT;
AND OTHER MATTERS IN CONNECTION THEREWITH
RECITALS
1. The City Council (the "Governing Body") of the City of Nederland, Texas (the
"Issuer"), a home rule city, has given notice of its intent to issue certificates of obligation (the
"Certificates") in an amount not to exceed $9,695,000 for the purpose of paying contractual
obligations of the Issuer to be incurred for construction of public works, and purchase of
materials, supplies, equipment, machinery, buildings, land, and rights-of-way for authorized
needs and purposes, to wit: (1) improvements and expansion to existing sanitary sewer facilities;
including replacement of main sewer lines and sewage treatment plant improvements; and (2)
certain other costs related and incidental thereto and the issuance costs of the Certificates. The
notice was published once a week for two consecutive weeks in a newspaper of general
circulation in the Issuer, the first publication being before and not less than 30 days prior to the
tentative date stated in the notice for the passage of this ordinance.
2. No petition signed by at least 5% of the qualified electors of the Issuer protesting
the issuance of the Certificates has been presented to or filed with the City Clerk of the Issuer
prior to the date set in such notice for passage of this Ordinance, nor has any such petition been
filed as of this date.
3. The Governing Body has found and determined that $9,695,000 in aggregate
principal amount of the Certificates described in such notice should now be issued and sold, and
has adopted this ordinance authorizing issuance of such Certificates.
4. It is in the Issuer's best interest to issue the certificate of obligations described
herein.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF NEDERLAND, TEXAS, THAT:
56432017.1 1
ARTICLE ONE
THE CERTIFICATES
SECTION 1.1 Authorization and Terms; Purpose.
A. Authorization, Title, Principal Amount, and Purpose. The Certificates are hereby
authorized to be issued in the aggregate principal amount of $9,695,000 and are entitled the
Issuer's "TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 2018", to pay
contractual obligations incurred to make permanent public improvements and for other public
purposes all as stated in Recital 1 hereto, pursuant to the authority conferred by and in
conformity with the laws of the State of Texas, particularly Texas Government Code section
1502.052, and the Certificate of Obligation Act of 1971, Texas Local Government Code sections
271.041 through 271.065, each as now in effect. The Certificates shall have a Dated Date of
October 1, 2018 (which is the "Dated Date" of the Certificates and to be inserted below"Dated
Date"immediately below the title thereof).
B. Denominations, Maturities, Rates of Interest. The Stated Maturities of the
Certificates are September 1 of the years and the aggregate principal amounts set forth below in
this Subsection, and interest on the Certificates of each Stated Maturity accrues from the Issue
Date or the most recent Interest Payment Date to which interest has been paid or duly provided
for, until such Certificates are paid or due provision therefor is made at or after the Maturity
thereof, at the per annum rates set forth opposite such Stated Maturity below, calculated on the
basis of a 360-day year of twelve 30-day months and payable semiannually on each March 1 and
September 1 commencing March 1, 2019:
Year of Principal Interest Year of Principal Interest
Stated Amount Rate (%) Stated Amount Rate (%)
Maturity Maturity
2019 $340,000 4.000% 2029 $485,000 3.000%
2020 350,000 4.000 2030 500,000 3.250
2021 365,000 4.000 2031 520,000 3.250
2022 380,000 4.000 2032 535,000 3.375
2023 395,000 4.000 2033 555,000 3.375
2024 410,000 4.000 2034 570,000 3.500
2025 425,000 4.000 2035 590,000 3.500
2026 440,000 4.000 2036 610,000 3.500
2027 460,000 3.000 2037 635,000 3.500
2028 475,000 3.000 2038 655,000 3.500
C. Payment. The principal of the Certificates is payable upon surrender, and the
interest on the Certificates is payable, at the corporate trust office of the Paying Agent in Dallas,
Texas or at such other city as designated by the Issuer upon Notice to the Registered Owners.
Such place is herein referred to as the"Place of Payment".
56432017.1 2
The Issuer shall transfer the principal of the Certificates to the Paying Agent on or prior
to the date it is due.
If the specified date for any payment of principal (or Redemption Price) of or interest on
the Certificates is a Saturday, Sunday, or legal holiday or equivalent (other than a moratorium)
for banking institutions generally in the city of the Place of Payment,such payment may be made
on the next succeeding day which is not one of the foregoing days without additional interest and
with the same force and effect as if made on the specified date for such payment.
D. Payment of Interest; Interest Rights Preserved. Interest on any Certificate is
payable to the Registered Owner thereof as of the Record Date and is payable(i) by check sent
by United States Mail, first-class postage prepaid, by the Paying Agent, to the address of the
Registered Owner appearing in the Security Register, or (ii) by such other method acceptable to
the Paying Agent requested in writing by the Registered Owner at the Registered Owner's risk
and expense.
In the event of a non-payment of interest on a scheduled payment date, and for 30 days
thereafter, a new record date for such interest payment (a "Special Record Date") will be
established by the Paying Agent, if and when funds for the payment of such interest have been
received from the Issuer. Notice of the Special Record Date and of the scheduled payment date
of the past due interest("Special Payment Date", which shall be 15 days after the Special Record
Date) shall be sent at least five business days prior to the Special Record Date by United States
mail, first class postage prepaid, to the address of each Registered Owner of a Certificate
appearing on the registration books of the Paying Agent at the close of business on the last
business day next preceding the date of mailing of such notice. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having been mailed as aforesaid,
such Defaulted Interest must be paid to the Persons in whose names the Certificates (or their
respective Predecessor Certificates) are registered on such Special Record Date.
E. Legal Tender. The principal of and interest on the Certificates is payable in any
coin or currency of the United States of America which at the time of payment is legal tender for
the payment of public and private debts, without exchange or collection charges to the
Registered Owner.
SECTION 1.2 Redemption.
A. Optional and Mandatory Redemption. The Certificates are subject to redemption
at the option of the Issuer and by mandatory redemption prior to Stated Maturity on the
Redemption Dates and Redemption Prices as provided in the Form of Certificate in Section 3.2.
B. Exercise of Redemption Option. At least 45 days prior to a date of redemption
(the "Redemption Date") (unless a shorter notification period shall be satisfactory to the Paying
Agent), the Issuer shall notify the Paying Agent of its decision to exercise the right to optionally
redeem Certificates, the principal amount of each Stated Maturity to be redeemed, and the
Redemption Date. The decision of the Issuer to exercise the right to redeem Certificate shall be
entered in the minutes of the Governing Body.
56432017.1 3
C. Selection of Certificates for Redemption. If less than all Outstanding Certificates
of the same Stated Maturity are to be redeemed on a Redemption Date, the Paying Agent shall
select at random and by lot the Certificates to be redeemed, provided that if less than the entire
principal amount of a Certificate is to be redeemed, the Paying Agent shall treat such Certificate
then subject to redemption as representing the number of Certificates Outstanding which is
obtained by dividing the principal amount of such Certificate by$5,000.
D. Notice of Redemption. Not less than 30 days prior to a Redemption Date, the
Issuer shall cause a notice of redemption to be sent by United States Mail, first-class postage
prepaid, in the name of the Issuer and at the Issuer's expense, by the Paying Agent to each
Holder of a Certificate to be redeemed in whole or in part at the address of the Holder appearing
on the Security Register at the close of business on the business day next preceding the date of
mailing such notice, and any notice of redemption so mailed shall be conclusively presumed to
have been duly given irrespective of whether received by the Holder. All notices of redemption
shall state:
(1) the Redemption Date,
(2) the redemption price (the"Redemption Price"),
(3) the principal amount and identification (by Issuer and Certificate name,
CUSP number, Stated Maturity, interest rate, Dated Date, and, in the case of partial
redemption, the Certificate numbers and respective principal amounts) of Certificates to
be redeemed,
(4) that on the Redemption Date the Redemption Price of each of the
Certificates to be redeemed will become due and payable and that interest thereon shall
cease to accrue from and after said date, and
(5) that the Certificates to be redeemed are to be surrendered for payment of
the Redemption Price at the Place of Payment, and the address of such Place of Payment.
E. Limitation on Transfer/Exchange of Certificates. Neither the Issuer nor the
Paying Agent is required to transfer or exchange any Certificates selected for redemption within
45 days of the Redemption Date, provided however, such limitation shall not be applicable to an
exchange by the Holder of the unredeemed balance of a Certificate which is subject to partial
redemption.
F. Payment of the Redemption Price. If a Certificate is subject by its terms to
redemption and has been called for redemption and notice of redemption thereof has been duly
given as hereinabove provided, such Certificate (or the principal amount thereof to be redeemed)
so called for redemption shall become due and payable, and if money sufficient for the payment
of such Certificates (or of the principal amount thereof to be redeemed) at the then applicable
Redemption Price is held for the purpose of such payment by the Paying Agent, then on the
Redemption Date, interest on the Certificate (or the principal amount thereof to be redeemed)
called for redemption shall cease to accrue and such Certificates shall no longer be deemed
Outstanding hereunder.
56432017.1 4
If any Certificate called for redemption shall not be so paid upon surrender thereof for
redemption, the same shall continue to bear interest from the Redemption Date therefore at the
rate borne by such Certificates.
SECTION 1.3 Execution, Registration, Delivery, and Dating.
The Mayor of the Issuer shall execute the Certificates on behalf of the Issuer and such
signature shall be attested by the City Clerk of the Issuer. The signature of either of said officers
on the Certificates may be manual or facsimile. Certificates bearing the manual or facsimile
signatures of individuals who were at the time the proper officers of the Issuer bind the Issuer,
notwithstanding that such individuals or either of them cease to hold such offices prior to the
certification and delivery of such Certificates.
The Mayor of the Issuer is authorized and directed to execute and the City Clerk of the
Issuer to attest the Initial Certificates in the name of Cede & Co. The Mayor of the Issuer is
further authorized and directed to submit the Initial Certificates, together with the record of the
proceedings authorizing the issuance thereof and any and all other necessary orders, certificates,
and records, to the Attorney General of Texas for approval. After the Attorney General has
approved such Certificates, the Mayor of the Issuer shall cause such Certificates to be delivered
to the Comptroller of Public Accounts of the State of Texas for registration. If requested by the
Attorney General or its representatives, or if otherwise deemed necessary to properly evidence
the intent of the Issuer in the adoption of this Ordinance, the Mayor or Mayor pro tem of the
Issuer may make such ministerial changes in the written text of this Ordinance as such officer
determines are consistent with the intent and purposes of this Ordinance, which determination
shall be final. Upon registration of the Certificates, the Comptroller is authorized and directed to
deliver the Certificates in accordance with instructions of the Mayor of the Issuer. At any time
thereafter the Issuer may deliver such Certificates to the Paying Agent together with definitive
Certificates to be issued in exchange therefor, and the Paying Agent is directed, within not more
than five business days following receipt of instructions from the payee named therein
designating the Persons, Stated Maturities, and denominations to and in which such Certificates
are to be transferred, register and deliver such definitive Certificates as provided in such
instructions. The officers or acting officers of the Governing Body are authorized to execute and
deliver on behalf of the Governing Body such certificates and instruments as may be necessary
to accomplish or in furtherance of the delivery of the Certificates to and payment therefor by the
Purchasers.
All Certificates registered and delivered by the Paying Agent hereunder are to be dated
by the Paying Agent the date of their registration.
No Certificate is entitled to any right or benefit under this Ordinance, or is valid or
obligatory for any purpose, unless there appears on such Certificate either a certificate of
registration substantially in the form provided in Section 3.3, executed by the Comptroller of
Public Accounts of the State of Texas or his duly authorized agent by manual signature, or a
certificate of registration substantially in the form provided in Section 3.4, executed by the
Paying Agent by manual signature, and either such certificate upon any Certificate is conclusive
56432017.1 5
evidence, and the only evidence, that such Certificate has been duly certified or registered and
delivered.
SECTION 1.4 Registration, Transfer, and Exchange.
The Issuer shall cause to be kept at the Place of Payment a register (herein referred to as
the "Security Register") in which, subject to such reasonable regulations as the Issuer or the
Paying Agent may prescribe, the Paying Agent shall provide for the registration of the
Certificates and of transfers of the Certificates as herein provided.
Upon surrender for transfer of any Certificate at the Place of Payment, the Issuer shall
execute, and the Paying Agent shall register and deliver, in the name of the designated transferee
or transferees, one or more new Certificates of the same Stated Maturity, of any authorized
denominations, and of a like aggregate principal amount. New Certificates registered, and
delivered in an exchange or transfer will be delivered by the Paying Agent at the Place of
Payment or sent by United States mail at the Registered Owner's written request, risk, and
expense.
At the option of the Registered Owner, Certificates may be exchanged for other
Certificates of the same Stated Maturity, of any authorized denominations, and of like aggregate
principal amount, upon surrender of the Certificates to be exchanged at the Place of Payment.
Whenever any Certificates are so surrendered for exchange; the Issuer shall execute, and the
Paying Agent shall register and deliver, the Certificates which the Registered Owner of
Certificates making the exchange is entitled to receive.
All Certificates issued in any transfer or exchange of Certificates shall be delivered to the
Registered Owners at the principal corporate trust office of the Paying Agent or sent by United
States Mail, first class, postage prepaid to the Registered Owners, and, upon the registration and
delivery thereof, the same shall be the valid obligations of the Issuer, evidencing the same
obligation to pay, and entitled to the same benefits under this Ordinance, as the Certificates
surrendered in such transfer or exchange.
Every Certificate presented or surrendered for transfer or exchange must be duly
endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the
Paying Agent duly executed, by the Registered Owner thereof or his attorney duly authorized in
writing.
No service charge may be made to the Registered Owner for any registration, transfer, or
exchange of Certificates, but the Issuer or the Paying Agent may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in connection with
any transfer or exchange of Certificates.
Neither the Issuer nor the Paying Agent is required (1) to transfer or exchange any
Certificate during a period beginning 45 days prior to a redemption date hereunder and ending at
the close of business on the day of mailing of a notice of redemption or (2) thereafter to transfer
or exchange in whole or in part any Certificate so selected for redemption.
56432017.1 6
SECTION 1.5 Mutilated, Destroyed, Lost, and Stolen Certificates.
If(1) any mutilated Certificate is surrendered to the Paying Agent, or the Issuer and the
Paying Agent receive evidence to their satisfaction of the destruction, loss, or theft of any
Certificate, and (2) there is delivered to the Issuer and the Paying Agent such security or
indemnity as they require to save each of them harmless, then, in the absence of notice to the
Issuer or the Paying Agent that such Certificate has been acquired by a bona fide purchaser, the
Issuer shall execute and upon its request the Paying Agent shall register and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost, or stolen Certificate, a new Certificate of the
same Stated Maturity, and of like tenor and principal amount, bearing a number not
contemporaneously outstanding.
In case any such mutilated, destroyed, lost, or stolen Certificate has become or is about to
become due and payable, the Issuer in its discretion may pay such Certificate instead of issuing a
new Certificate.
Upon the issuance of any new Certificate under this Section, the Issuer or the Paying
Agent may require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses connected therewith.
Every new Certificate issued pursuant to this Section in lieu of any mutilated, destroyed,
lost, or stolen Certificate constitutes an original additional contractual obligation of the Issuer,
whether or not the mutilated, destroyed, lost, or stolen Certificate is at any time enforceable by
anyone, and the new Certificate is entitled to all the benefits of this Ordinance equally and
ratably with all other Outstanding Certificates.
The provisions of this Section are exclusive and preclude (to the extent lawful) all other
rights and remedies with respect to the replacement and payment of mutilated, destroyed, lost, or
stolen Certificates.
SECTION 1.6 Persons Deemed Owners.
The Issuer and the Paying Agent, and any agent of either, may treat the Registered Owner
as the owner of a Certificate for purposes of receiving payment of principal of and (subject to
Section 1.1) interest on the Certificate and for all other purposes whatsoever, whether or not the
Certificate is due or overdue, and neither the Issuer nor the Paying Agent, or any agent of either,
is affected by notice to the contrary. All payments made to or duly provided for the Bondholder
in accordance with this Ordinance will be valid and effectual and will discharge the liability of
the Issuer to the extent of the sums paid in or duly provided for.
SECTION 1.7 Cancellation.
All Certificates surrendered for payment,redemption, transfer, exchange, or replacement,
if surrendered to the Paying Agent, are to be promptly canceled by it and, if surrendered to the
Issuer, are to be delivered to the Paying Agent and, if not already canceled, are to promptly be
canceled by the Paying Agent. The Issuer may at any time deliver to the Paying Agent for
cancellation any Certificates previously certified and delivered which the Issuer acquires in any
56432017.1 7
manner whatsoever, and all Certificates so delivered are to be promptly canceled by the Paying
Agent. No Certificate may be certified in lieu of or in exchange for any Certificate canceled as
provided in this Section, except as expressly provided by this Ordinance. All canceled
Certificates held by the Paying Agent are to be disposed of in accordance with the standard
document retention policies of the Issuer.
SECTION 1.8 Book-Entry Only.
Notwithstanding the provisions contained in Sections 1.3, 1.4 and 1.5 relating to the
payment, redemption and transfer/exchange of the Certificates, the Issuer hereby approves and
authorizes the use of "Book-Entry Only" securities clearance, settlement and transfer system
provided by The Depository Trust Company ("DTC"), a limited purpose trust company
organized under the laws of the State of New York, in accordance with DTC's requirements and
procedures, and authorizes the Issuer and the Paying Agent to take such as actions as are
necessary to qualify the Certificates with DTC and to deliver the Certificates through DTC.
Pursuant to the rules and procedures of DTC now in effect, the Certificates shall be
deposited with DTC (or with the Paying Agent on behalf of DTC) who shall hold said
Certificates for its participants (the "DTC Participants"). While the Certificates are so held, the
Registered Owner of the Certificates on the Security Register for all purposes, including payment
and notices, shall be Cede & Co., as nominee of DTC, notwithstanding the ownership of each
actual purchaser or owner of each Certificate (the "Beneficial Owners") being recorded in the
records of DTC and DTC Participants.
In the event DTC determines to discontinue serving as securities depository for the
Certificates or otherwise ceases to provide book-entry clearance and settlement of securities
transactions in general or the Issuer determines that DTC is incapable of properly discharging its
duties as securities depository for the Certificates, the Issuer covenants and agrees with the
Registered Owners of the Certificates to cause Certificates to be printed in definitive form and
provide for the certificated certificates to be issued and delivered to DTC Participants and
Beneficial Owners, as the case may be. Thereafter, the Certificates in definitive form shall be
assigned, transferred and exchanged on the Security Register maintained by the Paying Agent
and payment of such Certificates shall be made in accordance with the provisions of Sections
1.3, 1.4 and 1.5.
56432017.1 8
ARTICLE TWO
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
SECTION 2.1 Definitions.
For all purposes of this Ordinance, except as otherwise expressly provided or unless the
context otherwise requires:
(1) The terms defined in this Section have the meanings assigned to them in
this Section.
(2) All terms defined herein include the plural as well as the singular.
(3) All references in this Ordinance to designated "Articles", "Sections",
"Exhibits", and other subdivisions are to the designated Articles, Sections, Exhibits, and
other subdivisions of this Ordinance as originally adopted.
(4) The words "herein", "hereof', and"hereunder" and other words of similar
import refer to this Ordinance as a whole and not to any particular Article, Section,
Exhibit, or other subdivision.
"Certificate Fund" means the special fund of the Issuer created and established by the
provisions of Section 4.1.
"Certificates" means any obligation of the Issuer authorized to be issued by Article One,
whether initially delivered or issued in exchange for or upon transfer or in lieu of any
Predecessor Certificate.
"Collection Date" means, for any year, the date that annual ad valorem taxes levied by
the Issuer in that year become delinquent.
"Debt Service Requirement"has the meaning stated in Section 4.6.
"Fiscal Year" means the annual financial accounting period for the Issuer as established
by the Issuer on or prior to the date of this Ordinance; provided, however, the Governing Body
may change such annual financial accounting period to end on another date if such change is
found and determined to be necessary for accounting purposes or is required by applicable law.
"Governing Body" means the City Council of the Issuer.
"Governmental Obligations" means (1) direct obligations of, or obligations the timely
payment of the principal of and interest on which are fully and unconditionally guaranteed by,
the United States of America, or (2) obligations authorized under Texas law from time to time
for discharge and final payment of political or governmental obligations which, at the time of
deposit have been assigned ratings in the highest rating category by a nationally recognized
56432017.1 9
investment rating firm, but in the case of both Clauses (1) and (2) only if such obligations may
not be called for redemption prior to maturity.
"Gross Revenues" for any period means all revenue during such period in respect or on
account of the operation or ownership of the System, excluding refundable deposits, restricted
gifts, refunds for amounts advanced in aid of construction, and grants in aid of construction, but
including earnings and income derived from the investment or deposit of money in any special
fund or account (other than earnings on the Certificate Fund) created and established for the
payment or security of the Certificates.
"Interest Payment Date" means a date specified in the Certificates as a fixed date on
which an installment of interest thereon is due and payable.
"Issue Date"means the date on which Certificates are first registered and delivered to the
Purchasers in exchange for the purchase price therefor.
"Issuer"has the meaning stated in the Recitals.
"Maintenance and Operating Expenses" means all current expenses of operating and
maintaining the System not paid from the proceeds of the Certificates, including the cost of all
salaries, labor, materials, interest, repairs, and extensions necessary to provide efficient service,
and each proper item of expense, but only if, in the case of repairs and extensions, they are, in
the judgment of the Governing Body, necessary to keep the System in operation and render
adequate service to the Issuer and its residents, or respond to a physical accident or condition that
would otherwise impair the Certificates or Prior Obligations or Parity Obligations.
"Maturity" when used with respect to any Certificate means the date on which the
principal of such Certificate becomes due and payable as therein provided, whether at the Stated
Maturity, by call for redemption, or otherwise.
"Net Revenues" for any period means the Gross Revenues less the Maintenance and
Operating Expenses.
"Ordinance" means this Ordinance as finally passed and adopted by the Governing Body
or as it may from time to time be supplemented, modified, or amended in accordance with the
provisions hereof.
"Outstanding" when used with respect to Certificates means, as of the date of
determination, all Certificates theretofore issued and delivered under this Ordinance, except,
without duplication:
(1) Canceled Certificates: Certificates theretofore canceled by the Paying
Agent or delivered to the Paying Agent for cancellation;
(2) Gross Cash Defeasance: Certificates for whose payment or redemption
money in the necessary amount has been theretofore deposited with the Paying Agent in
trust for the Registered Owner of such Certificates, provided that, if such Certificates are
56432017.1 10
to be redeemed, notice of such redemption has been duly given pursuant to this
Ordinance, irrevocably provided for to the satisfaction of the Paying Agent, or waived;
(3) Replaced Certificates: Certificates in exchange for or in lieu of which
other Certificates have been registered and delivered pursuant to this Ordinance;
(4) Paid Missing Certificates: Certificates alleged to have been destroyed,
lost, or stolen which have been paid as provided in Section 1.5; and
(5) Net Cash Defeasance : Certificates for the payment of the principal of and
interest on which money or Governmental Obligations or both are held by the Paying
Agent or other bank or trust company and with the effect specified in Section 6.1;
provided, however, that in determining whether the Registered Owners of the requisite principal
amount of Certificates Outstanding have given any request, demand, authorization, direction,
notice, consent, or waiver hereunder, Certificates owned by the Issuer or any other obligor upon
the Certificates are disregarded and deemed not Outstanding, except that, in determining whether
the Paying Agent is protected in relying upon any such request, demand, authorization, direction,
notice, consent, or waiver, only Certificates which the Paying Agent knows to be so owned are
required to be so disregarded.
"Parity Obligations" means the obligations of the Issuer now or hereafter issued with a
lien on Net Revenues on a parity with the lien on Net Revenues granted the Certificates.
"Paying Agent" means the corporation named as the "Paying Agent" herein until a
successor Paying Agent becomes such pursuant to the applicable provisions of this Ordinance,
and thereafter"Paying Agent"means such successor Paying Agent.
"Person"means any individual, corporation, partnership,joint venture, association,joint-
stock company, trust, unincorporated organization, or government or any agency or political
subdivision thereof.
"Place of Payment" means a corporate trust office of the Paying Agent in the State of
Texas, as established in Section 1.1.
"Predecessor Certificates" of any particular Certificate means every previous Certificate
evidencing all or a portion of the same debt as that evidenced by such particular Certificate, and,
for purposes of this definition, any Certificate registered and delivered under Section 1.5 in lieu
of a mutilated, lost, destroyed, or stolen Certificate is deemed to evidence the same debt as the
mutilated, lost, destroyed, or stolen Certificate.
"Prior Obligations"means the obligations of the Issuer so defined in Section 4.7.
"Purchaser" means the initial purchaser or purchasers of the Certificates named in
Section 7.1 of this Ordinance.
56432017.1 1 1
"Registered Owner" mean the registered owner, whose name appears in the Security
Register, for any Certificate.
"Regular Record Date" for the interest payable on any Interest Payment Date means the
close of business on the 15th day (whether or not a business day) of the calendar month next
preceding such Interest Payment Date.
"Security Register" has the meaning stated in Section 1.4.
"Stated Maturity" when used with respect to any Certificate means the date specified in
such Certificate as the fixed date on which the principal of such Certificate is due and payable.
"Subordinate Lien Obligations" means any bonds, notes, warrants, certificates of
obligation, or any similar obligations hereafter issued by the Issuer that are payable, in whole or
in part, from and equally and ratably secured by a lien on and pledge of the Net Revenues, such
pledge being subordinate and inferior to the lien on and pledge of Net Revenues to payment of
the Certificates.
"System" means all of the Issuer's waterworks and sewer system, together with all future
extensions, improvements, and additions thereto and replacements thereof, excluding from the
foregoing, however, to the extent now or hereafter authorized or permitted by law, facilities of
any kind which are declared by the Governing Body, prior to the acquisition or construction
thereof by the Issuer, not to be a part of the System and which are acquired or constructed by or
on behalf of the Issuer with the proceeds from the issuance of"Special Facilities Obligations",
which are hereby defined as being special revenue obligations of the Issuer which are not
payable from Net Revenues but which are payable from and secured by other liens on and
pledges of any revenues, sources, or payments, not pledged to the payment of the Certificates.
SECTION 2.2 Notices.
Where this Ordinance provides for notice to Registered Owners of any event, such notice
is sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-
class postage prepaid, to each Registered Owner, at the address of such Registered Owner as it
appears in the Security Register. Neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Registered Owner affects the sufficiency of such notice with
respect to all other Registered Owners. Any notice so mailed shall be conclusively presumed to
have been duly given, whether or not the Registered Owner receives such notice. Where this
Ordinance provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event with respect to which such
notice is given, and such waiver is the equivalent of such notice. Waivers of notice by
Registered Owners are to be filed with the Issuer, but such filing is not a condition precedent to
the validity of any action taken in reliance upon such waiver.
SECTION 2.3 Effect of Headings and Table of Contents; Recitals.
The section headings herein and in the Table of Contents are for convenience only and do
not affect the construction hereof
56432017.1 12
The Recitals contained in the preamble hereof are hereby found to be true, and such
Recitals are hereby made a part hereof for all purposes and are adopted as part of the judgment
and findings of the Governing Body.
SECTION 2.4 Ordinance a Contract;Amendments.
This Ordinance constitutes a contract with the Registered Owners entered into upon the
initial purchase of the Certificates, is binding on the Issuer and its successors and assigns
whether or not so expressed, and may not be amended or repealed by the Issuer so long as any
Certificate remains Outstanding except as permitted in this Section.
The Issuer may, without the consent of or notice to any Registered Owner, from time to
time and at any time amend this Ordinance in any manner not detrimental to the interests of the
Registered Owners, including the curing of any ambiguity, inconsistency, or formal defect or
omission herein or therein. In addition,the Issuer may, with the written consent of the Registered
Owners of a majority in aggregate principal amount of the Certificates then Outstanding affected
thereby, amend, add to, or rescind any of the provisions of this Ordinance; provided that, without
the consent of the Registered Owners of all of the affected Outstanding Certificates, no such
amendment, addition, or rescission may (1) change the Stated Maturity of the Certificates or any
Interest Payment Date for an installment of interest thereon, reduce the principal amount thereof,
or the rate of interest thereon, change the place or places at, or the coin or currency in, which any
Certificate or the interest thereon is payable, or in any other way modify the terms or sources of
payment of the principal of or interest on the Certificates, (2) give any preference to any
Certificate over any other Certificate, (3) modify any of the provisions of the proviso to the
definition of the term "Outstanding", or (4) modify any of the provisions of this Section, except
to increase the percentage provided hereby or to provide that certain other provisions of this
Ordinance cannot be modified or waived without the consent of the Registered Owner of each
Certificate affected thereby.
Any consent to any amendment hereof by the Registered Owner of any Certificate binds
every future Registered Owner of the same Certificate and the Registered Owner of every
Certificate issued upon transfer or in lieu thereof or in exchange therefor, in respect of anything
done or suffered to be done by the Issuer in reliance thereon, whether or not notation of such
action is made upon such Certificate.
SECTION 2.5 Benefits of Ordinance.
Nothing in this Ordinance, expressed or implied, is intended or may be construed to
confer upon any Person (other than the Issuer and Registered Owners) any right, remedy, or
claim, legal or equitable, under or by reason of this Ordinance or any provision hereof, this
Ordinance and all its provisions being intended to be and being for the sole and exclusive benefit
of the Issuer and the Registered Owners.
SECTION 2.6 Repealer.
All orders, ordinances, and resolutions, or parts thereof, which are in conflict or
inconsistent with any provision of this Ordinance are hereby repealed and declared to be
56432017.1 13
inapplicable to the extent of such conflict, and the provisions of this Ordinance are controlling as
to the matters prescribed herein.
SECTION 2.7 Governing Law.
This Ordinance is to be construed in accordance with and governed by the laws of the
State of Texas and the United States of America.
SECTION 2.8 Severability.
If any provision of this Ordinance or the application thereof to any Person or
circumstance is held to be invalid, illegal, or unenforceable, the remainder of this Ordinance and
the application of such provision to other Persons and circumstances is nevertheless valid, legal,
and enforceable and the Governing Body hereby declares that this Ordinance would have been
enacted without such invalid provision or application.
SECTION 2.9 Public Meeting
The Governing Body officially finds, determines, and declares that notice of the adoption
of this Ordinance was posted as required by law at a location within the Issuer in a place readily
accessible to the general public at all times for at least 72 hours preceding the scheduled time of
the meetings at which this Ordinance is read and approved; that such meetings were open to the
public; and that public notice of the time, place, and purpose of such meetings was given as
required by Texas Government Code chapter 551, as amended.
SECTION 2.10 Authority of Officers.
The Mayor, the Mayor Pro Tem, the City Clerk or any assistant City Clerk, Manager,
Attorney, or Director of Finance of the Issuer, or any of them, are authorized to evidence
adoption of this Ordinance and to do any and all things proper and necessary to carry out the
intent hereof.
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56432017.1 14
ARTICLE THREE
FORMS
SECTION 3.1 Forms Generally.
The Certificates,the Registration Certificate of the Comptroller of Public Accounts of the
State of Texas to be reproduced on the initial Certificates, the Registration Certificate of the
Paying Agent to be reproduced on subsequently delivered Certificates, and the form of
Assignment to be reproduced on each of the Certificates are to be substantially in the forms set
forth in this Article with such appropriate insertions, omissions, substitutions, and other
variations as are permitted or required by this Ordinance, and the Certificates may have such
letters, numbers, or other marks of identification (including identifying numbers and letters of
the Committee on Uniform Securities Identification Procedures of the American Bankers
Association) and such legends and endorsements (including any reproduction of an opinion of
counsel or notice of insurance) thereon as may, consistently herewith, be determined by the
officers executing such Certificates as evidenced by their execution thereof. Any portion of the
text of any Certificates may be set forth on the reverse thereof, with an appropriate reference
thereto on the face of the Certificate.
The Certificates may be printed, lithographed, engraved, typewritten, photocopied, or
produced by any combination of these methods, or produced in any other manner, all as
determined by the officers executing such Certificates as evidenced by their execution thereof.
The initial Certificates to be delivered to the Attorney General may be issued either(i) as a single
fully registered certificate in the total principal amount of the Certificates with principal
installments to become due and payable as provided in Section 1.1 hereof and numbered
consecutively T-1 and upward, or (ii) as fully registered certificates, being one note for each
stated maturity in the applicable principal amount and denomination and to be numbered
consecutively from T-1 and upward(hereinafter called the"Initial Certificate(s)").
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56432017.1 15
SECTION 3.2 Form of Definitive Certificate.
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation ("DTC"), to the Issuer or its agent for registration of
transfer, exchange, or payment, and any certificate issued is registered in the name of Cede &
Co. or in such other name as is requested by an authorized representative of DTC (and any
payment is made to Cede& Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede& Co.,has an interest herein.
REGISTERED REGISTERED
NO. $
United States of America
State of Texas
CITY OF NEDERLAND, TEXAS
TAX AND REVENUE CERTIFICATE OF OBLIGATION,
SERIES 2018
Interest Rate: Dated Date: Stated Maturity: CUSIP NO:
October 112018
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
The City of Nederland, Texas (hereinafter together with its successors referred to as the
"Issuer"), a body politic and municipal corporation duly organized and existing under and by
virtue of the laws of the State of Texas, for value received, hereby promises to pay, but solely to
and from the extent of the sources described herein, to the Registered Owner specified above or
registered assigns, on the Stated Maturity specified above, the Principal Amount specified above,
and to pay interest thereon to the Person herein specified from the Issue Date thereof, or from the
most recent Interest Payment Date to which interest has been paid or duly provided for, until
such principal is paid or duly provided for on or after such Stated Maturity or any earlier
Redemption Date, semiannually on March 1 and September 1 in each year commencing March
1, 2019, at the per annum Interest Rate specified above, computed on the basis of a 360-day year
of twelve 30-day months and, except as otherwise permitted by the Ordinance hereinafter
referred to,to make the payments to the United States of America in the amounts and on the date
therein described when due. Principal of this Certificate is payable at its Stated Maturity to the
Registered Owner hereof, upon presentation and surrender, at the principal payment office of the
Paying Agent executing the Registration Certificate of Paying Agent appearing hereon, which
shall initially be BOKF,NA, or its successor in its designated place of payment, initially Dallas,
Texas(the "Place of Payment").
56432017.1 16
The interest so payable on, and paid or duly provided for on or within 10 days after, any
Interest Payment Date will be paid to the Person in whose name this Certificate (or one or more
Predecessor Certificates evidencing the same debt) is registered at the close of business on the
Regular Record Date for such interest, which is the 15th day (whether or not a business day) of
the calendar month next preceding such Interest Payment Date. Any such interest not so paid or
duly provided for ceases to be payable to the Person in whose name such Certificate is registered
on such Regular Record Date, and shall be paid to the Person in whose name this Certificate (or
one or more Predecessor Certificates) is registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest to be fixed by the Paying Agent, notice whereof
being sent to the Registered Owners of the Certificates not less than five business days prior to
the Special Record Date. All such interest is payable at the Place of Payment. Such interest is
payable (1)by check or draft mailed to the address of the Registered Owner as the same appears
on the Security Register of the Issuer kept by the Paying Agent, as Registrar, or (2) in
accordance with other customary arrangements acceptable to the Paying Agent made by the
Registered Owner. The principal of this Certificate is payable at the Place of Payment upon
presentation and surrender of this Certificate. All such payments must be made in such coin or
currency of the United States of America as at the time of payment is legal tender for payment of
public and private debts.
If the specified date for any such payment is a Saturday, Sunday, or legal holiday or
equivalent (other than a moratorium) for banking institutions generally in the city in which the
Place of Payment is located, such payment may be made on the next succeeding day which is not
one of the foregoing days without additional interest and with the same force and effect as if
made on the specified date for such payment.
This Certificate is one of the series specified in its title issued in the aggregate principal
amount of$9,695,000 (the "Certificates") pursuant to an Ordinance adopted by the governing
body of the Issuer (the "Ordinance"), to pay contractual obligations of the Issuer incurred
construction of public works, and purchase of materials, supplies, equipment, machinery,
buildings, land, and rights-of-way for authorized needs and purposes, to wit: (1) improvements
and expansion to existing sanitary sewer facilities; including replacement of main sewer lines
and sewage treatment plant improvements; and (2) certain other costs related and incidental
thereto and the issuance costs of the Certificates, under and in strict conformity with the laws of
the State of Texas, particularly Texas 1502.052 section and the Certificate of Obligation, Act of
1971, as amended, Texas Local Government Code sections 271.041 through 271.063, as
amended.
The Certificates with a Stated Maturity on or after September 1, 2027 may be redeemed
at the option of the Issuer, on notice mailed to the Registered Owners thereof not less than 30
days prior to the Redemption Date as provided in the Ordinance, as a whole or from time to time
in part in integral multiples of$5,000 principal on any date prior to their Stated Maturity, but not
before September 1, 2026,upon payment of the Redemption Price, which is the principal amount
thereof together with interest, if any, accrued from the most recent Interest Payment Date to the
Redemption Date. The optional redemption of certificates may be conditioned upon issuance of
one or more series of refunding bonds or obligations to pay the redemption price of the
Certificates to be redeemed on or prior to the redemption date.
56432017.1 17
Certificates of a denomination larger than $5,000 may be redeemed in part (in, and
leaving unredeemed, an authorized denomination) and upon any partial redemption of any such
Certificate the same must be surrendered in exchange for one or more new Certificates of the
same Stated Maturity in authorized denominations for the unredeemed portion of principal.
Certificates (or portions thereof) for whose redemption and payment provision is made in
accordance with the Ordinance cease to bear interest from and after the Redemption Date.
If this Certificate (or any portion of the principal sum hereof) has been duly called for
redemption and notice of such redemption duly given, then upon such redemption date this
Certificate (or the portion of the principal sum hereof to be redeemed) is due and payable, and, if
money for the payment of the redemption price and the interest accrued on the principal amount
to be redeemed to the date of redemption is held for the purpose of such payment by the Paying
Agent, interest ceases to accrue and to be payable hereon from and after the redemption date on
the principal amount hereof to be redeemed.
The Certificates of this series are payable from the proceeds of an ad valorem tax levied
upon all taxable property within the Issuer, within the limitations prescribed by law, and are
further payable from and secured by a lien on and pledge of the Net Revenues derived from the
operation of the Issuer's waterworks and sanitary sewer system (the "System") as identified and
defined in the Ordinance. In the Ordinance, the Issuer reserves and retains the right to issue
additional obligations prior and superior in right to, on a parity with, or subordinate to the
Certificates with respect to the lien on Net Revenues, and the Certificates are issued with the
pledge of Net Revenues subordinate to the pledge of Net Revenues to the Issuer's other
outstanding obligations, and any other obligations of the Issuer hereafter issued which are issued
with a pledge of Net Revenues prior and senior to or on a parity with the pledge of Net Revenues
to the Certificates.
Reference is hereby made to the Ordinance, copies of which are on file in the principal
corporate trust office of the Paying Agent, and to all of the provisions of which the Registered
Owner by his acceptance hereof hereby assents, for definitions of terms; the description of and
the nature and extent of the tax levied and the revenues pledged for the payment of the
Certificates; the terms and conditions relating to the transfer or exchange of the Certificates; the
conditions upon which the Ordinance may be amended or supplemented with or without the
consent of the Registered Owner; the rights, duties, and obligations of the Issuer and the Paying
Agent;the terms and provisions upon which this Certificate may be redeemed or discharged at or
prior to the Stated Maturity thereof, and deemed to be no longer Outstanding thereunder; and for
the other terms and provisions specified in the Ordinance. Capitalized terms used herein have
the same meanings assigned in the Ordinance.
The Ordinance permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the Issuer and the rights of the
Registered Owners of the Certificates under the Ordinance at any time by the Issuer with the
consent of the Registered Owners of a majority in aggregate principal amount of such
Certificates at the time outstanding affected by such modification. Any such consent by the
Registered Owners of this Certificate or any Predecessor Certificate herefor evidencing the same
debt is conclusive and binding upon such Registered Owner and all future Registered Owners of
56432017.1 18
this Certificate and of any Certificate issued upon the transfer or in lieu hereof or in exchange
herefor,whether or not notation of such consent is made upon this Certificate.
As provided in the Ordinance and subject to certain limitations therein set forth, this
Certificate is transferable on the Security Register of the Issuer,upon surrender of this Certificate
for transfer to the Paying Agent at the Place of Payment, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Paying Agent duly executed by, the
Registered Owner hereof or its attorney duly authorized in writing, and thereupon one or more
new fully registered Certificates of the same Stated Maturity, of authorized denominations, and
for the same aggregate principal amount will be issued to the designated transferee or
transferees.
The Certificates are issuable as fully registered Certificates in denominations of principal,
equal to $5,000 and any integral multiple thereof. Upon surrender of this Certificate for
exchange to the Paying Agent at the Place of Payment, and subject to certain limitations set forth
in the Ordinance, one or more new fully registered Certificates of the same Stated Maturity, of
designated authorized denominations, and for the same aggregate principal amount will be issued
to the Registered Owner of this Certificate.
No service charge may be made for any transfer or exchange hereinabove referred to, but
the Issuer or the Paying Agent may require payment of a sum sufficient to cover any tax or
governmental charge payable in connection therewith.
The Issuer, the Paying Agent, and any agent of either of them may treat the Person in
whose name this Certificate is registered as the Registered Owner hereof for the purpose of
receiving payment as herein provided and for all other purposes, whether or not this Certificate
be overdue, and none of the Issuer, the Paying Agent, and any such agent is affected by notice to
the contrary.
It is hereby certified, covenanted, and represented that all acts, conditions, and things
required to be performed, exist, and be done precedent to the issuance of this Certificate in order
to render the same a legal,valid, and binding obligation of the Issuer have been performed, exist,
and have been done, in regular and due time, form, and manner, as required by law, and that
issuance of the Certificates does not exceed any constitutional or statutory limitation. In case
any provision in this Certificate or any application thereof is deemed invalid, illegal, or
unenforceable, the validity, legality, and enforceability of the remaining provisions and
applications is not in any way affected or impaired thereby. The terms and provisions of this
Certificate and the Ordinance are to be construed in accordance with and governed by the laws of
the State of Texas.
Unless either a Registration Certificate hereon has been executed by the Comptroller of
Public Accounts of the State of Texas or his duly authorized agent or by the Paying Agent,
respectively, by manual signature, this Certificate shall not be entitled to any benefit under the
Ordinance or be valid or obligatory for any purpose.
56432017.1 19
IN WITNESS WHEREOF, the Issuer has caused this Certificate to be duly executed.
c) ..R1-41/0 CITY OF NEDERLAND, TEXAS
.'741 V; By
Mayor
C ty Clerk
[The remainder of this page intentionally left blank.]
56432017.1 20
SECTION 3.3 Form of Registration Certificate of Comptroller of Public Accounts.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS*
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS §
§ REGISTER NO
THE STATE OF TEXAS §
I HEREBY CERTIFY that this Certificate has been examined, certified as to validity and
approved by the Attorney General of the State of Texas, and duly registered by the Comptroller
of Public Accounts of the State of Texas.
WITNESS my signature and seal of office this
Comptroller of Public Accounts
(SEAL) of the State of Texas
* Note to Printer: Not to appear on printed Certificates
SECTION 3.4 Form of Certificate of Paying Agent.
CERTIFICATE OF PAYING AGENT*
This Certificate has been duly issued under the provisions of the within-mentioned
Ordinance; the Certificate or Certificates of the above-entitled and designated series originally
delivered having been approved by the Attorney General of the State of Texas and registered by
the Comptroller of Public Accounts, as shown by the records of the Paying Agent.
Registration Date
BOKF NA
as Paying Agent
By
Authorized Officer
* Note to Printer: Not to appear on initial Certificates
56432017.1 21
SECTION 3.5 Form ofAssignment.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto
(Print or typewrite name, address, and zip code of transferee):
(Social Security or other identifying number: )
the within Certificate and all rights thereunder, and hereby irrevocably constitutes and appoints...
attorney to transfer the within Certificate on the books kept for registration thereof, with full
power of substitution in the premises.
DATED:
NOTICE: The signature on this assignment
Signature guaranteed: must correspond with the name of the
registered owner as it appears on the face of
the within Certificate in every particular.
SECTION 3.6 Form of Initial Certificate.
The Initial Certificate shall be in the form set forth in Section 3.2 except that the form of
a single fully registered Certificate shall be modified as follows:
(i) immediately under the name of the Certificate the headings "Interest Rate
", "Stated Maturity ", and "CUSIP No. " will be
omitted;
(ii) Paragraph one will read as follows:
The City of Nederland, Texas (hereinafter together with its successors referred to as the
"Issuer"), a body politic and municipal corporation duly organized and existing under and by
virtue of the laws of the State of Texas, for value received, hereby promises to pay, but solely to
and from the extent of the sources described herein, to the Registered Owner specified above or
registered assigns, the hereinabove stated the Principal Amount on September 1 in each of the
years and in principal amounts and bearing interest at per annum rates in accordance with the
following schedule:
56432017.1 22
Year of Principal Interest
Stated Maturity Amount Rate(%)
(Information to be inserted from schedule in Section 1.1 hereof).
(or so much thereof as shall not have been paid upon prior redemption) and to pay interest
thereon computed on the basis of a 360-day year of twelve 30-day months to the Person herein
specified from the Issue Date, or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, until such principal is paid or duly provided for on or after
such Stated Maturity or any earlier Redemption Date, semiannually on March 1 and September 1
in each year commencing March 1, 2019, at the per annum Interest Rates specified above,
computed on the basis of a 360-day year of twelve 30-day months. Principal installments of this
Certificate are payable at its Stated Maturity or on a prepayment date to the registered owner
hereof by BOKF,NA (the "Paying Agent"),upon its presentation and surrender, at its designated
offices in Dallas,Texas(the"Place of Payment").
SECTION 3.7 Insurance Legend
If bond insurance is obtained by the Issuer or the Purchaser for the Certificates, the
Definitive Certificates and the Initial Certificate(s) shall bear an appropriate legend as provided
by the insurer.
56432017.1 23
ARTICLE FOUR
TAXES,REVENUES,AND FUNDS;
INVESTMENTS
SECTION 4.1 Certificate Fund.
To pay interest on and to provide a sinking fund for the payment, redemption, and
retirement of the Certificates, the Issuer hereby creates and shall maintain solely for such
purposes (subject to the provisions of Section 5.5) a special fund designated as its
"CERTIFICATES OF OBLIGATION, SERIES 2018, INTEREST AND SINKING FUND" (the
"Certificate Fund"). The Issuer authorizes and directs its authorized officials to withdraw from
the Certificate Fund and to transfer to the Paying Agent money on deposit in the Certificate Fund
sufficient to pay the amount of principal or interest falling due on the Certificates, such transfer
of funds to the Paying Agent to be made in such manner as will cause immediately available
funds to be deposited with the Paying Agent on or before the last business day next preceding
each Maturity or Interest Payment Date for the Certificates.
SECTION 4.2 Deposits to Certificate Fund;Excess Certificate Proceeds.
The Issuer, prior to a Maturity or Interest Payment Date for the Certificates, may deposit
any of the Net Revenues to the Certificate Fund in accordance with Section 4.3. The Net
Revenues, if deposited, shall be expended annually to pay principal of and interest on the
Certificates as the same become due and payable. The Net Revenues so deposited shall be
accounted for and transferred to the Paying Agent in accordance with the provisions of
Section 4.1 governing other money in the Certificate Fund.
The Issuer shall deposit accrued interest and premium, if any, received from the
Purchaser and ad valorem taxes levied and collected to pay principal of or interest on the
Certificates to the Certificate Fund. In addition, the Issuer shall deposit any surplus proceeds,
including investment income therefrom, from the sale of the Certificates not expended for
authorized purposes to the Certificate Fund.
SECTION 4.3 System Account.
The Issuer shall keep all Gross Revenues derived from operation of the System separate
and apart from all other funds, accounts, and money of the Issuer and shall deposit amounts
collected into the Issuer's "WATERWORKS AND SEWER SYSTEM ACCOUNT" (the
"System Account"). The Issuer shall pledge and appropriate money in the System Account as
required for the following purposes and in the order of priority shown:
First: as a first charge on and claim against the Gross Revenues, to pay reasonable and
proper Maintenance and Operating Expenses required by statute or ordinances
authorizing the issuance of any indebtedness of the Issuer;
Second: to deposit amounts required in the special funds and accounts established for
payment of any obligations of the Issuer with a lien on Gross Revenues or Net Revenues
prior or superior to the lien granted to secure payment of the Certificates;
56432017.1 24
Third: to deposit amounts required in the special funds and accounts established for the
payment of the Certificates or any additional obligations of the Issuer secured by the Net
Revenues on a parity with the Certificates; and
Fourth: any Net Revenues remaining in the System Account after satisfying the
foregoing payments, or making adequate and sufficient provision for the payment,
security and benefit thereof, to be appropriated and used for any other Issuer purpose now
or hereafter permitted by law.
SECTION 4.4 Construction Accounts.
Except as provided in Section 4.2, the Issuer will deposit proceeds derived from the sale
of the Certificates (after paying costs of issuance) into special construction account or accounts
created for the projects to be constructed with such proceeds. Pending completion of
construction of the projects financed with such proceeds interest earned on the such proceeds
must be accounted for, maintained, deposited, and expended as permitted by the provisions of
Texas Government Code section 1201.043, as from time to time in effect, or as otherwise
required by applicable law. Thereafter, such interest must be accounted for, maintained,
deposited, and expended in accordance with Section 4.5.
SECTION 4.5 Investments and Security For Funds.
The Issuer is required to keep all money in such funds and accounts at a depository of the
Issuer except when invested pursuant to this Section. Subject to Section 5.6, money in any fund
established by this Ordinance may, at the option of the Issuer, be invested in a manner permitted
by the provisions of the Public Funds Investment Act of 1987, Texas Government Code chapter
2256, subchapter A, as then in effect, the Public Funds Collateral Act, Texas Government Code
chapter 2257, as then in effect, or by any other law applicable to the Issuer; provided that all such
investments must be made so that money required to be expended will be available at the proper
time or times. The Issuer shall credit or debit all interest and income or losses from deposits and
investments in any fund or account established pursuant to the provisions of this Ordinance shall
be credited to such fund or account. The Issuer shall sell investments promptly as necessary to
prevent any default in connection with the Certificates.
All money on deposit in the Funds for which this Ordinance makes provision(except any
portion thereof as may be at any time properly invested as provided herein) shall be secured in
the manner and to the fullest extent required by the laws of Texas for the security of public
funds, and money on deposit in such Funds shall be used only for the purposes permitted by this
Ordinance.
SECTION 4.6 Tax Levy.
To provide for the payment of the Debt Service Requirements, which are defined to be
(i)the interest on the Certificates and (ii) a sinking fund for payment of principal of the
Certificates at Stated Maturity or earlier redemption or a sinking fund of 2% (whichever amount
is greater), the Issuer levies and shall levy for the current year and each succeeding year
thereafter while the Certificates or any interest thereon is Outstanding, a sufficient tax on each
56432017.1 25
$100 of taxable property in the Issuer, within the limitations prescribed by law, adequate to pay
such amounts, full allowance being made for delinquencies and costs of collection. Such tax
shall be assessed and collected each year, and the same may not be diverted to any other purpose.
The Issuer shall pay the taxes so levied and collected into the Certificate Fund. The Governing
Body hereby declares its purpose and intent to provide and levy such tax, it having been
determined that the existing and available taxing authority of the Issuer for such purpose is
adequate to permit a legally sufficient tax in consideration of all other outstanding indebtedness.
The Issuer shall determine the amount of taxes to be provided annually for the Debt
Service Requirement in the following manner:
A. Prior to establishing the annual tax rate, the Governing Body shall determine:
(1) the amount of Debt Service Requirements to become due and payable on
the Certificates between the Collection Date for the taxes then to be levied and the
Collection Date for the taxes to be levied during the next succeeding calendar year;
(2) the amount on deposit in the Certificate Fund (including surplus
Certificate proceeds transferred to the Certificate Fund under Section 4.2) after (a)
deducting therefrom the total amount of Debt Service Requirements to become due on
Certificates prior to the Collection Date for the ad valorem taxes then to be levied and (b)
adding thereto the amount of the Net Revenues, if any, to be appropriated and allocated
to pay such Debt Service Requirements, if any, prior to the Collection Date for the ad
valorem taxes then to be levied; and
(3) the amount of Net Revenues, if any, to be appropriated and to be set aside
for the payment of the Debt Service Requirements on the Certificates between the
Collection Date for the taxes then to be levied and the Collection Date for the taxes to be
levied during the next succeeding Fiscal Year.
B. The Issuer shall assess and levy annually each year a tax to pay the Debt Service
Requirements sufficient to provide tax revenues in the amount established in paragraph(1) above
less the sum total of the amounts established in paragraphs (2) and (3), after taking into
consideration delinquencies and costs of collecting such annual taxes.
SECTION 4.7 Net Revenues.
The Issuer covenants and agrees that the Net Revenues are hereby irrevocably pledged to
the payment of the principal of and interest on the Certificates and the pledge of Net Revenues
herein made for the payment of the Certificates shall constitute a lien on the Net Revenues in
accordance with the terms and provisions hereof and be valid and binding without any physical
delivery thereof or further act by the Issuer. The pledge of Net Revenues hereunder is
subordinate to the prior pledge of Net Revenues to secure the Issuer's outstanding obligations
secured by a pledge of Net Revenues to the extent of such pledge (together with prior obligations
hereafter issued pursuant to Section 4.8 (the "Prior Obligations").
56432017.1 26
Section 1208, Government Code, applies to the issuance of the Certificates and the
pledge of the Net Revenues of the System granted by the Issuer under this Section, and such
pledge is therefore valid, effective and perfected. If Texas law is amended at any time while the
Certificates are Outstanding such that the pledge of the Net Revenues of the System granted by
the Issuer under this Section is subject to the filing requirements of Chapter 9, Business &
Commerce Code, then to preserve to the Bondholders the perfection of the security interest in
said pledge, the Issuer agrees to take such measures as it determines are reasonable and
necessary under Texas law to comply with the applicable provisions of Chapter 9, Business &
Commerce Code and enable a filing to perfect the security interest in said pledge to occur.
SECTION 4.8 Issuance of Additional Obligations.
The Issuer hereby expressly reserves the right to hereafter issue bonds, notes, warrants,
certificates of obligation, or similar obligations, payable, wholly or in part, as appropriate, from
and secured by a pledge of and lien on the Net Revenues of the System prior and superior in
right to, on a parity with the Certificates as Parity Obligations, or subordinate to the pledge of
and lien on the Net Revenues in favor of the Certificates, without limitation as to principal
amount, but subject to any terms, conditions, or restrictions applicable thereto under existing
ordinances, laws, or otherwise.
56432017.1 27
ARTICLE FIVE
COVENANTS
SECTION 5.1 To Maintain Agency.
The Issuer will at all times until the Certificates are duly paid maintain an agency
meeting the qualifications herein described, for the performance of the duties of the Paying
Agent hereunder. BOKF, NA, is hereby appointed Paying Agent for such purposes. The Issuer
retains the right to replace the Paying Agent, and the Paying Agent may be removed from its
duties hereunder at any time upon not less than 30 days notice with or without cause by action of
the Governing Body entered in its minutes, but no such removal is effective until a successor has
accepted the duties of the Paying Agent hereunder by written instrument.
Every Paying Agent appointed hereunder must at all times be a commercial bank or trust
company organized and doing business under the laws of the United States of America or of any
state, authorized under such laws to exercise corporate trust powers, having a combined capital
and surplus of at least $10,000,000, subject to supervision or examination by federal or state
authority, registered as a transfer agent with the Securities and Exchange Commission. If such
corporation publishes reports of condition at least annually pursuant to law or to the requirements
of such supervising or examining authority, then for the purposes of this Section the combined
capital and surplus of such corporation shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. Upon any change in the Paying
Agent, the City agrees to promptly cause a written notice thereof to be sent to each Registered
Owner affected by the change,which notice shall also give the address of the new Paying Agent,
which shall be the designated Place of Payment.
This Section is subject to the provisions of Section 8.2.
The terms of the Transfer and Paying Agency Agreement with the initial Paying Agent
are hereby approved in substantially the form and to the effect presented to the Governing Body
on this date, and the Mayor and the Mayor Pro Tem of the Issuer, or either of them, and the City
Clerk and any Assistant or Acting City Clerk of the Issuer, or any of them, are hereby authorized
to execute and deliver such Transfer and Paying Agency Agreement.
SECTION 5.2 To Maintain and Operate the System and Insure Property.
The Issuer covenants and agrees that while the Certificates remain Outstanding it will
maintain and operate the System with all possible efficiency and maintain casualty and other
insurance on the properties of the System and its operations of a kind and in such amounts
customarily carried by municipalities in the State of Texas engaged in a similar type of business
and that it will faithfully and punctually perform all duties with reference to the System required
by the laws of the State of Texas. All money received from losses under such insurance policies,
other than public liability policies, are hereby pledged as security for the Certificates until and
unless the proceeds are paid out in making good the loss or damage in respect of which such
proceeds are received, either by replacing the property destroyed or repairing the property
damaged, and adequate provision for making good such loss or damage must be made within 90
56432017.1 28
days after the date of loss. The payment of premiums for all insurance policies required under
the provisions hereof shall be considered Maintenance and Operating Expenses. Nothing in this
Ordinance may be construed as requiring the Issuer to expend any funds which are derived from
sources other than the operation of the System but nothing herein may be construed as
preventing the Issuer from doing so.
SECTION 5.3 Rates and Charges.
The Issuer hereby covenants and agrees that rates and charges for services afforded by
the System will be established and maintained to provide Gross Revenues sufficient at all times:
A. to pay all Maintenance and Operating Expenses;
B. to produce Net Revenues sufficient (but subject to the maximum amount of Net
Revenues pledged hereunder), together with any other lawfully available funds, to produce an
amount of Net Revenues sufficient to pay the interest on and principal of the Certificates and any
additional obligations of the Issuer hereafter issued on a parity therewith; and
C. to pay other legally incurred indebtedness payable from the Net Revenues or
secured by a lien on the System or the Net Revenues thereof.
SECTION 5.4 Records and Accounts, Annual Audit.
The Issuer covenants and agrees that so long as any of the Certificates remain
Outstanding it will keep and maintain separate and complete records and accounts pertaining to
the operations of the System in which complete and correct entries shall be made of all
transactions relating thereto, as provided by Texas Government Code section 1502.067, as
amended, or other applicable law. The Registered Owners or any duly authorized agent or
agents of the Registered Owners may inspect the System and all properties comprising the same.
The Issuer agrees that, following the close of each Fiscal Year, it will cause an audit of its books
and accounts to be made by an independent firm of Certified Public Accountants. Copies of
each annual audit shall be furnished to the Executive Director of the Municipal Advisory Council
of Texas at his office in Austin, Texas, and, upon written request, to the original purchaser of the
Certificates and any subsequent Registered Owner thereof Expenses incurred in making the
annual audit of the operations of the System are Maintenance and Operating Expenses.
SECTION 5.5 Special Covenants.
The Issuer covenants that:
A. Lawful Authority: it has the lawful power to pledge the Net Revenues supporting
the Certificates and has lawfully exercised said powers under the laws of the State of Texas;
B. No Encumbrance: as long as any Certificates or any interest thereon remain
Outstanding, the Issuer will not sell, lease or encumber (except in the manner provided in
Section 4.8) the System or any substantial part thereof, provided that this covenant shall not be
56432017.1 29
construed to prohibit the sale of such machinery, or other properties or equipment which has
become obsolete or otherwise unsuited to the efficient operation of the System; and
C. No Franchise: to the extent that it legally may, the Issuer further covenants and
agrees that, so long as any of the Certificates, or any interest thereon, are Outstanding, no
franchise shall be granted for the installation or operation of any competing systems other than
those owned by the Issuer, and the operation of any such systems by anyone other than the Issuer
is hereby prohibited.
SECTION 5.6 Covenants to Maintain Tax-Exempt Status.
A. Definitions. When used in this Section, the following terms have the following
meanings:
•
"Closing Date" means the date on which the Certificates are first authenticated and
delivered to the initial purchasers against payment therefor.
"Code" means the Internal Revenue Code of 1986, as amended by all legislation, if any,
effective on or before the Closing Date.
"Computation Date"has the meaning set forth in Section 1.148-1(b)of the Regulations.
"Gross Proceeds" means any proceeds as defined in Section 1.148-1(b) of the
Regulations, and any replacement proceeds as defined in Section 1.148-1(c) of the Regulations,
of the Certificates.
"Investment"has the meaning set forth in Section 1.148-1(b)of the Regulations.
"Nonpurpose Investment"means any investment property, as defined in section 148(b) of
the Code, in which Gross Proceeds of the Certificates are invested and which is not acquired to
carry out the governmental purposes of the Certificates.
"Rebate Amount"has the meaning set forth in Section 1.148-1(b)of the Regulations.
"Regulations" means any proposed, temporary, or final Income Tax Regulations issued
pursuant to Sections 103 and 141 through 150 of the Code, and 103 of the Internal Revenue
Code of 1954, which are applicable to the Certificates. Any reference to any specific Regulation
shall also mean, as appropriate, any proposed, temporary or final Income Tax Regulation
designed to supplement, amend or replace the specific Regulation referenced.
"Yield"of
(1) any Investment has the meaning set forth in Section 1.148-5 of the Regulations; and
(2) the Certificates has the meaning set forth in Section 1.148-4 of the Regulations.
56432017.1 30
B. Not to Cause Interest to Become Taxable. The Issuer shall not use, permit the use
of, or omit to use Gross Proceeds or any other amounts (or any property the acquisition,
construction or improvement of which is to be financed directly or indirectly with Gross
Proceeds) in a manner which if made or omitted, respectively, would cause the interest on any
Certificate to become includable in the gross income, as defined in section 61 of the Code, of the
owner thereof for federal income tax purposes. Without limiting the generality of the foregoing,
unless and until the Issuer receives a written opinion of counsel nationally recognized in the field
of municipal bond law to the effect that failure to comply with such covenant will not adversely
affect the exemption from federal income tax of the interest on any Certificate, the Issuer shall
comply with each of the specific covenants in this Section.
C. No Private Use or Private Payments. Except as permitted by section 141 of the
Code and the Regulations and rulings thereunder, the Issuer shall at all times prior to the last
Stated Maturity of Certificates:
(1) exclusively own, operate and possess all property the acquisition, construction or
improvement of which is to be financed or refinanced directly or indirectly with Gross Proceeds
of the Certificates, and not use or permit the use of such Gross Proceeds (including all
contractual arrangements with terms different than those applicable to the general public) or any
property acquired, constructed or improved with such Gross Proceeds in any activity carried on
by any person or entity (including the United States or any agency, department and
instrumentality thereof) other than a state or local government, unless such use is solely as a
member of the general public; and
(2) not directly or indirectly impose or accept any charge or other payment by any
person or entity who is treated as using Gross Proceeds of the Certificates or any property the
acquisition, construction or improvement of which is to be financed or refinanced directly or
indirectly with such Gross Proceeds, other than taxes of general application within the Issuer or
interest earned on investments acquired with such Gross Proceeds pending application for their
intended purposes.
D. No Private Loan. Except to the extent permitted by section 141 of the Code and
the Regulations and rulings thereunder,the Issuer shall not use Gross Proceeds of the Certificates
to make or finance loans to any person or entity other than a state or local government. For
purposes of the foregoing covenant, such Gross Proceeds are considered to be "loaned" to a
person or entity if: (1) property acquired, constructed or improved with such Gross Proceeds is
sold or leased to such person or entity in a transaction which creates a debt for federal income tax
purposes; (2) capacity in or service from such property is committed to such person or entity
under a take-or-pay, output or similar contract or arrangement; or (3) indirect benefits, or
burdens and benefits of ownership, of such Gross Proceeds or any property acquired, constructed
or improved with such Gross Proceeds are otherwise transferred in a transaction which is the
economic equivalent of a loan.
E. Not to Invest at Higher Yield. Except to the extent permitted by section 148 of
the Code and the Regulations and rulings thereunder, the Issuer shall not at any time prior to the
final Stated Maturity of the Certificates directly or indirectly invest Gross Proceeds in any
56432017.1 31
Investment, if as a result of such investment the Yield of any Investment acquired with Gross
Proceeds, whether then held or previously disposed of, exceeds the Yield of the Certificates.
F. Not Federally Guaranteed. Except to the extent permitted by section 149(b) of the
Code and the Regulations and rulings thereunder, the Issuer shall not take or omit to take any
action which would cause the Certificates to be federally guaranteed within the meaning of
section 149(b) of the Code and the Regulations and rulings thereunder.
G. Information Report. The Issuer shall timely file the information required by
section 149(e) of the Code with the Secretary of the Treasury on Form 8038-G or such other
form and in such place as the Secretary may prescribe.
H. Rebate of Arbitrage Profits. Except to the extent otherwise provided in section
148(f) of the Code and the Regulations and rulings thereunder:
(1) The Issuer shall account for all Gross Proceeds (including all receipts, expenditures
and investments thereof) on its books of account separately and apart from all other funds (and
receipts, expenditures and investments thereof) and shall retain all records of accounting for at
least six years after the day on which the last outstanding Certificate is discharged. However, to
the extent permitted by law, the Issuer may commingle Gross Proceeds of the Certificates with
other money of the Issuer, provided that the Issuer separately accounts for each receipt and
expenditure of Gross Proceeds and the obligations acquired therewith.
(2) Not less frequently than each Computation Date, the Issuer shall calculate the Rebate
Amount in accordance with rules set forth in section 148(f) of the Code and the Regulations and
rulings thereunder. The Issuer shall maintain such calculations with its official transcript of
proceedings relating to the issuance of the Certificates until six years after the final Computation
Date.
(3) As additional consideration for the purchase of the Certificates by the Purchasers and
the loan of the money represented thereby and in order to induce such purchase by measures
designed to insure the excludability of the interest thereon from the gross income of the owners
thereof for federal income tax purposes, the Issuer shall pay to the United States out of its
general fund, other appropriate fund, or, if permitted by applicable Texas statute, regulation or
opinion of the Attorney General of the State of Texas, the Certificate Fund, the amount that when
added to the future value of previous rebate payments made for the Certificates equals (i)in the
case of a Final Computation Date as defined in Section 1.148-3(e)(2) of the Regulations, one
hundred percent (100%) of the Rebate Amount on such date; and (ii) in the case of any other
Computation Date, ninety percent (90%) of the Rebate Amount on such date. In all cases, the
rebate payments shall be made at the times, in the installments, to the place and in the manner as
is or may be required by section 148(f) of the Code and the Regulations and rulings thereunder,
and shall be accompanied by Form 8038-T or such other forms and information as is or may be
required by Section 148(f) of the Code and the Regulations and rulings thereunder.
(4) The Issuer shall exercise reasonable diligence to assure that no errors are made in the
calculations and payments required by paragraphs (2) and(3), and if an error is made,to discover
56432017.1 32
and promptly correct such error within a reasonable amount of time thereafter (and in all events
within one hundred eighty (180) days after discovery of the error), including payment to the
United States of any additional Rebate Amount owed to it, interest thereon, and any penalty
imposed under Section 1.148-3(h) of the Regulations.
I. Not to Divert Arbitrage Profits. Except to the extent permitted by section 148 of
the Code and the Regulations and rulings thereunder, the Issuer shall not, at any time prior to the
earlier of the Stated Maturity or final payment of the Certificates, enter into any transaction that
reduces the amount required to be paid to the United States pursuant to Subsection H of this
Section because such transaction results in a smaller profit or a larger loss than would have
resulted if the transaction had been at arm's length and had the Yield of the Certificates not been
relevant to either party.
J. Elections. The Issuer hereby directs and authorizes the Mayor Mayor Pro Tern,
Secretary, Manger, Attorney, or Director of Finance of the Issuer, either or any combination of
them, to make elections permitted or required pursuant to the provisions of the Code or the
Regulations, as they deem necessary or appropriate in connection with the Certificates, in the
Certificate as to Tax Exemption or similar or other appropriate certificate, form or document.
SECTION 5.7 Remedies in Event of Default.
In addition to all the rights and remedies provided by the laws of the State of Texas, the
Issuer covenants and agrees particularly that in the event the Issuer (a) defaults in the payments
to be made to the Certificate Fund, or(b) defaults in the observance or performance of any other
of the covenants, conditions, or obligations set forth in this Ordinance, the Registered Owners of
any of the Certificates shall be entitled to seek a writ of mandamus issued by a court of proper
jurisdiction compelling and requiring the governing body of the Issuer and other officers of the
Issuer to observe and perform any covenant, condition, or obligation prescribed in this
Ordinance.
No delay or omission to exercise any right or power accruing upon any default shall
impair any such right or power or shall be construed to be a waiver of any such default or
acquiescence therein, and every such right and power may be exercised from time to time and as
often as may be deemed expedient. The specific remedies herein provided shall be cumulative of
all other existing remedies and the specification of such remedies shall not be deemed to be
exclusive.
56432017.1 33
ARTICLE SIX
DEFEASANCE
SECTION 6.1 Discharge of Obligations.
Any Certificate is deemed paid and is no longer considered to be Outstanding within the
meaning of this Ordinance when payment of the principal of and interest on such Certificate to
the Stated Maturity thereof or(if notice of redemption has been duly given, irrevocably provided
for, or waived as provided herein)to the redemption date has been made or has been provided for
by deposit with the Paying Agent for such payment (or with any other bank or trust company
which has agreed to hold the same for such purpose) (1) money sufficient to make such payment,
(2) Governmental Obligations certified by an independent public accounting firm of national
reputation to be of such maturities and interest payment dates and to bear such interest as will,
without further investment or reinvestment of either the principal amount thereof or the interest
earnings therefrom, be sufficient to make such payment, or (3) a combination of money and
Governmental Obligations together so certified sufficient to make such payment, provided that
all the expenses pertaining to the Certificates with respect to which such deposit is made have
been paid or the payment thereof provided for to the satisfaction of the Paying Agent (and to
such other bank or trust company).
If such deposit is made with respect to some but not all of the Certificates then
Outstanding, the Issuer shall designate the Stated Maturities of Certificates with respect to which
such deposit is made. If such deposit is sufficient so to provide for the payment of the principal
of and interest on some but not all Outstanding Certificates of a particular Stated Maturity so
designated, the Paying Agent shall select the Outstanding Certificates of such Stated Maturity
with respect to which such deposit is made by such random method as the Paying Agent deems
fair and appropriate and which may provide for the selection of portions (equal to and leaving
unredeemed an authorized denomination) of Certificates a denomination larger than$5,000.
Notwithstanding anything herein to the contrary, no such deposit has the effect described
in this Section (a) if made during the subsistence of a default in the payment of any Certificate
unless made with respect to all of the Certificates then Outstanding or(b) unless accompanied by
an opinion of counsel of recognized standing in the field of federal income taxation to the effect
that neither such deposit nor the investment thereof adversely affects the excludability of interest
on any Certificate from the gross income of any owner thereof for federal income tax purposes.
The Paying Agent (or other bank or trust company) with which a deposit is made of
money and Governmental Obligations for such purpose shall hold the deposit in a segregated
account in trust or escrow for the Registered Owners of the Certificates with respect to which
such deposit is made and, together with any investment income therefrom, the deposit may be
disbursed solely to pay the principal of and interest on such Certificates when due, except that
cash receipts may be withdrawn and paid to the Issuer provided the date and amount of such
withdrawals are taken into account in the most recent verification of the accounting firm referred
to in this Section. No money or Governmental Obligations so deposited may be invested or
reinvested unless in Governmental Obligations and unless such money and Governmental
Obligations not invested and such new investments are together certified by an independent
56432017.1 34
public accounting firm of national reputation to be of such amounts, maturities, and interest
payment dates and to bear such interest as will, without further investment or reinvestment of
either the principal amount thereof or the interest earnings therefrom, be sufficient to make such
payment.
At such times as a Certificate is deemed to be paid hereunder, as aforesaid, it is no longer
entitled to the benefits of this Ordinance, except for the purposes of any such payment from such
money or Governmental Obligations and for the provisions of Sections 1.4 and 1.5 and for the
continuing compliance of the Issuer with the provisions of Section 5.6.
Upon such deposit as described above, such Certificates shall no longer be regarded to be
outstanding or unpaid. Provided, however, the Issuer has reserved the option, to be exercised at
the time of the defeasance of the Certificates, to call for redemption at an earlier date those
Certificates which have been defeased to their maturity date, if the Issuer (i) in the proceedings
providing for the firm banking and financial arrangements, expressly reserves the right to call the
Certificates for redemption, (ii) gives notice of the reservation of that right to the owners of the
Certificates immediately following the making of the firm bank and financial arrangements, and
(iii) directs that notice of the reservation be included in any redemption notices that it authorizes.
56432017.1 35
ARTICLE SEVEN
SALE
SECTION 7.1 Sale of the Certificates.
The sale of the Certificates to Piper Jaffray& Co. (the "Purchaser"), at the price of par in
the amount of$9,695,000, plus a net premium of$263,787.30, less an underwriters discount of
$69,094.85, plus accrued interest thereon from the Dated Date to the date of initial delivery, is
hereby confirmed and determined to be in compliance with the terms of the Notice of Sale,
except for the requirement that no maturity may be adjusted by more than 10% which is waived,
and the maturities submitted are approved.
Delivery of the Certificates shall be made to the Purchaser as soon as practicable after the
adoption of this Ordinance,upon payment therefor in accordance with the terms of sale.
SECTION 7.2 Payment of Costs of Issuance;Engagement of Bond Counsel.
The Issuer has in consultation with its financial advisor, USCA Municipal Advisors, LLC
set aside an amount of the proceeds of the Certificates to pay costs of issuance of the Certificates.
The amount of such proceeds will be designated in a closing letter prepared by the financial
advisor, and in the absence of contrary written instructions included as part of such closing letter
to deposit such proceeds with the Issuer, the Paying Agent will pay such costs of issuance on
behalf of the Issuer in accordance with invoices.
The Issuer hereby confirms engagement of Norton Rose Fulbright US LLP as Bond
Counsel ("Bond Counsel") for the City in accordance with the terms of the Letter of Engagement
between the Issuer and Bond Counsel.
SECTION 7.3 Official Statement.
The Issuer hereby approves and ratifies distribution of the Preliminary Official Statement
and Notice of Sale and Bidding Instructions relating to the Certificates. The Issuer further
approves and authorizes distribution of the Official Statement, dated the date hereof,
substantially in the form of the Preliminary Official Statement but completed and modified to
reflect the terms of sale of the Certificates and such other changes as the Mayor of the Issuer
shall approve. The Mayor of the Issuer and City Clerk of the Issuer are authorized to execute
and deliver for and on behalf of the Issuer sufficient copies of such Official Statement, and, in
the form and content manually executed by said officials of the Issuer, the same shall be deemed
approved by this Governing Body and constitute the Official Statement duly authorized for
distribution.
56432017.1 36
ARTICLE EIGHT
CONTINUING DISCLOSURE UNDERTAKING
SECTION 8.1 Definitions.
As used in this Article, the following terms have the meanings ascribed to such terms
below:
"EMMA"means the Electronic Municipal Market Access system.
"MSRB"means the Municipal Securities Rulemaking Board.
"Rule" means SEC Rule 15c2-12, as amended from time to time or officially interpreted
by the SEC.
"SEC"means the United States Securities and Exchange Commission.
SECTION 8.2 Updated Information and Data.
The Issuer shall provide annually to the MSRB through EMMA, within six months after
the end of each fiscal year ending in or after September 30, 2018, financial information and
operating data with respect to the Issuer of the general type included in the Preliminary Official
Statement provided to the Purchaser in connection with its initial approval of its purchase of the
Certificate of Obligations, being the information described in Exhibit A hereto. Any financial
statements so to be provided shall be (1) prepared in accordance with the accounting principles
set forth in Appendix A to the Official Statement, or as may otherwise hereafter be established
consistent with Texas law and Generally Accepted Accounting Principles, and (2) audited, if the
Issuer commissions an audit of such statements and the audit is completed within the period
during which they must be provided. If audited financial statements are not so provided, then the
Issuer shall provide audited fmancial statements for the applicable fiscal year to the MSRB
through EMMA, when and if audited financial statements become available but if such audited
financial statements are unavailable the Issuer will provide such fmancial statements on an
unaudited basis within the above-described six-month period.
If the Issuer changes its fiscal year, it will notify the MSRB through EMMA of the
change (and of the date of the new fiscal year end) prior to the next date by which the Issuer
otherwise would be required to provide fmancial information and operating data pursuant to this
Section.
The financial information and operating data to be provided pursuant to this Section may
be set forth in full in one or more documents or may be included by specific reference to any
document (including an official statement or other offering document, if it is available from the
MSRB) that theretofore has been provided to the MSRB through EMMA or filed with the SEC,
or may be provided in any other manner consistent with the Rule.
56432017.1 37
SECTION 8.3 Material Event Notices.
The Issuer shall notify the MSRB through EMMA of any of the following events with
respect to the Certificates in a timely manner, and not more than 10 business days after
occurrence of the event:
1. Principal and interest payment delinquencies;
2. Non-payment related defaults, if material;
3. Unscheduled draws on debt service reserves reflecting fmancial difficulties;
4. Unscheduled draws on credit enhancements reflecting financial difficulties;
5. Substitution of credit or liquidity providers, or their failure to perform;
6. Adverse tax opinions the issuance by the Internal Revenue Service of proposed or
final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-
TEB), or other material notices or determinations with respect to the tax-exempt
status of the Certificates, or other material events affecting the tax status of the
Certificates;
7. Modifications to rights of Registered Owners of the Certificates, if material;
8. Certificate calls, if material, and tender offers;
9. Defeasances;
10. Release, substitution, or sale of property securing repayment of the Certificates; if
material;
11. Rating changes;
12. Bankruptcy, insolvency, receivership, or similar event of the Issuer, which shall
occur as described below;
13. The consummation of a merger, consolidation, or acquisition involving the Issuer
or the sale of all or substantially all of its assets, other than in the ordinary course
of business, the entry into of a definitive agreement to undertake such an action or
the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and
14. Appointment of a successor or additional trustee or the change of name of a
trustee, if material.
The Issuer shall notify the MSRB through EMMA., in a timely manner, of any failure by
the Issuer to provide financial information or operating data in accordance with Section 8.2 by
the time required by such Section.
56432017.1 38
SECTION 8.4 Limitations, Disclaimers, and Amendments.
The Issuer shall be obligated to observe and perform the covenants specified in this
Section with respect to the Issuer and the Certificates while,but only while, the Issuer remains an
"obligated person" with respect to the Certificates within the meaning of the Rule, except that
the Issuer in any event will give the notice required by Section 8.3 of any Certificate calls and
defeasance that cause the Issuer to be no longer such an"obligated person".
The provisions of this Article are for the sole benefit of the Registered Owners and
beneficial owners of the Certificates, and nothing in this Article, express or implied, shall give
any benefit or any legal or equitable right, remedy, or claim hereunder to any other person. The
Issuer undertakes to provide only the financial information, operating data, financial statements,
and notices which it has expressly agreed to provide pursuant to this Article and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the financial results, condition, or prospects of the Issuer or the State of Texas or
hereby undertake to update any information provided in accordance with this Article or
otherwise, except as expressly provided herein. The Issuer does not make any representation or
warranty concerning such information or its usefulness to a decision to invest in or sell
Certificates at any future date.
UNDER NO CIRCUMSTANCES SHALL THE ISSUER BE LIABLE TO THE
REGISTERED OWNER OR BENEFICIAL OWNER OF ANY CERTIFICATE ANY OTHER
PERSON, IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN
PART FROM ANY BREACH BY THE ISSUER, WHETHER NEGLIGENT OR WITHOUT
FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS ARTICLE, BUT EVERY
RIGHT AND REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON
ACCOUNT OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR
MANDAMUS OR SPECIFIC PERFORMANCE.
No default by the Issuer in observing or performing its obligations under this Article shall
constitute a breach of or default under this Ordinance for purposes of any other provision of this
Ordinance.
Nothing in this Article is intended or shall act to disclaim, waive, or otherwise limit the
duties of the Issuer under federal and state securities laws.
The provisions of this Article may be amended by the Issuer from time to time to adapt to
changed circumstances resulting from a change in legal requirements, a change in law, or a
change in the identity, nature, status, or type of operations of the Issuer, but only if (1) the
provisions of this Article, as so amended, would have permitted an underwriter to purchase or
sell Certificates in the primary offering of the Certificates in compliance with the Rule, taking
into account any amendments or interpretations of the Rule to the date of such amendment, as
well as such changed circumstances, and (2) either (a) the Registered Owners of a majority in
aggregate principal amount (or any greater amount required by any other provision of this
Ordinance that authorizes such an amendment) of the Outstanding Certificates consent to such
amendment or (b) a Person that is unaffiliated with the Issuer (such as nationally recognized
56432017.1 39
bond counsel) determines that such amendment will not materially impair the interests of the
Registered Owners and beneficial owners of the Certificates. The Issuer may also amend or
repeal the provisions of this Article if the SEC amends or repeals the applicable provisions of the
Rule or a court of final jurisdiction determines that such provisions are invalid,but in either case
only to the extent that its right to do so would not prevent the Purchaser from lawfully
purchasing the Certificates in the offering described herein. If the Issuer so amends the
provisions of this Article, it shall include with any amended financial information or operating
data next provided in accordance with Section 8.2 an explanation, in narrative form, of the
reasons for the amendment and of the impact of any change in the type of financial information
or operating data so provided.
56432017.1 40
This Ordinance is in force and effect from and after its final passage, and it is so
ordained.
PASSED AND ADOPTED on September 24, 2018.
.4. N CITY OF NEDERLAND, TEXAS
•
AgOe-i45
=off,
'•. �?,{j� ' Mayor
peur 4, / of i
ity Clerk
56432017.1 S-1
EXHIBIT A
In the Preliminary Official Statement dated September 18, 2018, the quantitative
financial information and operating data with respect to the Issuer of general type contained in
Schedules 1 through 14 and certain information in the annual financial statements in
Appendix C.
56432017.1 A-1
ORDINANCE NO.2018-29
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
NEDERLAND,TEXAS AMENDING THE FISCAL YEAR 2017-
2018 BUDGET IN ACCORDANCE WITH THE BUDGET AND
THE CHARTER OF THE CITY OF NEDERLAND.
WHEREAS,the City Council previously approved Ordinance No.2017-19,which adopted
the Fiscal Year 2017-2018 City Budget;and,
WHEREAS, the City Council deems it necessary to amend the current budget to adjust
revenues and expenditures as set out in Attachment"A"attached hereto;and,
WHEREAS,the 2017-2018 City budget states "That any unencumbered funds remaining
on hand at the end of the fiscal year ending September 30, 2018 shall be construed with and
classified with Miscellaneous revenue anticipated during the fiscal year beginning October 1,
2017 and ending September 30,2018,and such funds are hereby appropriated as a City Council
Contingency Account for purposes approved by the City Council;and,
NOW,THEREFORE,BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF NEDERLAND,
TEXAS:
THAT the budget for the fiscal year 2017-2018 is amended to allow for adjustments in
revenues and expenditures as set out in Attachment"A."
THAT all ordinances and parts of ordinances in conflict herewith are expressly repealed.
THAT the City Clerk shall file a true copy of this ordinance and said budget amendment
with the Office of County Clerk of Jefferson County,Texas as provided by Section 102.011 of the
Local Government Code.
THAT,this being an ordinance not requiring publication,it shall take effect and be in force
from and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF NEDERLAND AT A
01641443,VIEETING THIS THE 24th DAY OF SEPTEMBER,2018.
104410: / i° _ R.A.Nugent ayor
r; ��`/^ City of Nederland,Texas
'1/4Cpl d�
ay Ferg 'on,City Cl k
APPROVED AS TO FORM AND LEGALITY:
Jesse : anick, ' ttorney
1
CITY OF NEDERLAND
BUDGET AMENDMENT REQUEST
FISCAL YEAR: 2017-2018
DATE: September 24,2018
DEPARTMENT: Various
FUND: General(01)
AMOUNT
CURRENT INCREASE PROPOSED
ACCOUNT NO. ACCOUNT TITLE BUDGET (DECREASE) BUDGET
01-0000-4110 Current Taxes 3,865,000 250,000 4,115,000
01-0000-4120 Industrial in lieu of Tax Payments 1,700,000 251,789 1,951,789
01-0000-4130 Sales Tax 3,050,000 150,000 3,200,000
01-0000-4480 Donations - 25,316 25,316
01-0000-4610 Interest Income 15,000 75,000 90,000
01-1100-6333 Travel&Training 4,000 (800) 3,200
01-1300-6110 Salaries&Wages 308,664 (2,000) 306,664
01-1300-6115 Extra Help 3,000 3,800 6,800
01-1300-6393 Contractual Services 48,000 14,000 62,000
01-1500-6110 Salaries&Wages 122,787 7,600 130,387
01-1500-6311 Auditing&Accounting 45,000 (7,000) 38,000
01-1600-6110 Salaries&Wages 151,331 1,400 152,731
01-1600-6314 Medical Svs and Pre Employ 8,500 (1,000) 7,500
01-1600-6393 Contractual Services 30,000 (23,000) 7,000
01-1601-6312 Consultant Services 900 3,000 3,900
01-1900-6265 Supplies/Minor Tools&Equipment 2,500 1,500 4,000
01-1900-6348 Electricity 9,000 (2,000) 7,000
01-1900-6380 Janitorial Services 22,440 (15,000) 7,440
01-2100-6110 Salaries&Wages 1,975,882 124,118 2,100,000
01-2100-6116 Certification Pay 94,470 (24,470) 70,000
01-2100-6121 Group Insurance 347,544 (7,544) 340,000
01-2100-6124 TMRS 147,225 3,000 150,225
01-2100-6128 Worker's Compensation 42,373 (4,000) 38,373
01-2100-6231 Wearing Apparel 19,000 4,900 23,900
01-2100-6265 Supplies/Minor Tools&Equipment 15,000 2,500 17,500
01-2100-6274 Safety Equipment 3,800 (2,000) 1,800
01-2100-6315 Computer System 12,000 20,000 32,000
01-2100-6322 Postage&Freight 6,000 (3,000) 3,000
01-2100-6341 Insurance General 28,000 (2,000) 26,000
01-2100-6380 Janitorial Services - 5,100 5,100
01-2100-6384 Prisoner Cost 25,000 5,000 30,000
TOTAL 12,102,416 854,209 12,956,625
Page of
CITY OF NEDERLAND
BUDGET AMENDMENT REQUEST
FISCAL YEAR: 2017-2018
DATE: September 24,2018
DEPARTMENT: Various
FUND: General(01)
AMOUNT
CURRENT INCREASE PROPOSED
ACCOUNT NO. ACCOUNT TITLE BUDGET (DECREASE) BUDGET
01-2101-6111 Overtime - 13,500 13,500
01-2101-6115 Extra Help 17,500 (8,855) 8,645
01-2101-6124 TMRS - 1,000 1,000
01-2101-6222 Motor Vehicle Fuel 6,200 (2,200) 4,000
01-2101-6236 Foods 16,800 (13,200) 3,600
01-2101-6265 Supplies/Minor Tools&Equip 3,000 (1,500) 1,500
01-2101-6393 Contractual Services - 16,000 16,000
01-2102-6333 Training&Travel 3,000 (2,400) 600
01-2200-6110 Salaries&Wages 1,027,251 (27,251) 1,000,000
01-2200-6111 Overtime 86,400 80,000 166,400
01-2200-6121 Group Insurance 152,897 (12,000) 140,897
01-2200-6124 TMRS 75,269 5,000 80,269
01-2200-6128 Worker's Compensation 17,776 (1,500) 16,276
01-2200-6380 Janitorial Services - 3,508 3,508
01-2200-6393 Contractual Services 4,000 (2,000) 2,000
01-2400-6110 Salaries&Wages 133,669 4,000 137,669
01-2400-6115 Extra Help 10,000 3,000 13,000
01-2400-6210 General Office Supplies 6,000 (3,000) 3,000
01-2400-6212 Books&Publications 1,500 (1,000) 500
01-2400-6380 Janitorial Services - 5,520 5,520
01-2400-6393 Contractual Services 22,000 (12,000) 10,000
01-3000-6110 Salaries&Wages 157,398 6,800 164,198
01-3000-6121 Group Insurance 24,805 3,000 27,805
01-3000-6210 General Office Supplies 4,000 (1,500) 2,500
01-3000-6341 Insurance General 4,400 10,400 14,800
01-3000-6349 Natural Gas 1,500 2,300 3,800
01-3100-6110 Salaries&Wages 415,936 6,000 421,936
01-3100-6111 Overtime 30,000 (12,000) 18,000
01-3100-6222 Motor Vehicle Fuel 35,000 (10,000) 25,000
01-3100-6246 Street&Bridge Supplies 105,000 (30,000) 75,000
01-3100-6348 Insurance Motor Equipment 7,800 (1,000) 6,800
01-3100-6354 Traffic Lights 9,000 (4,000) 5,000
01-3100-6366 Rental Equipment 10,000 (5,000) 5,000
01-3100-6730 Street Improvements 275,000 25,000 300,000
TOTAL 2,663,101 34,622 2,697,723
Page of
CITY OF NEDERLAND
BUDGET AMENDMENT REQUEST
FISCAL YEAR: 2017-2018
DATE: September 24, 2018
DEPARTMENT: Various
FUND: General (01)
AMOUNT
CURRENT INCREASE PROPOSED
ACCOUNT NO. ACCOUNT TITLE BUDGET (DECREASE) BUDGET
01-3400-6333 Travel&Training 2,500 (1,000) 1,500
01-5100-6110 Salaries&Wages 191,088 (6,000) 185,088
01-5100-6111 Overtime 24,000 (14,000) 10,000
01-5100-6115 Extra Help 125,000 (33,000) 92,000
01-5100-6126 Social Security 26,075 (2,000) 24,075
01-5100-6236 Foods 10,500 (2,500) 8,000
01-5100-6256 Chemicals&Insecticides 35,000 10,000 45,000
01-5100-6341 Insurance General 19,704 (2,500) 17,204
01-5100-6393 Contractual Services 12,000 5,000 17,000
01-5500-6115 Extra Help 44,500 (6,500) 38,000
01-5500-6341 Insurance General 19,100 (1,000) 18,100
01-5500-6348 Electricity 22,000 (6,000) 16,000
01-5500-6350 Bldg/Structure Improvements 6,000 1,500 7,500
01-9000-6315 Computer System 90,000 35,000 125,000
01-9000-6393 Contractual Services 203,731 (23,731) 180,000
01-9000-6406 Contingency 50,000 (25,000) 25,000
01-9000-6409 Vacation Buy Back 23,000 (23,000) -
01-9000-6411 Preventive Care Reimbursement 40,000 (40,000) -
01-9000-6907 Transfer to Capital Outlay Fund 332,448 200,000 532,448
01-9000-6393 Transfer to SIF - 50,000 50,000
TOTAL 1,276,646 115,269 1,391,915
Page of
CITY OF NEDERLAND
BUDGET AMENDMENT REQUEST
FISCAL YEAR: 2017-2018
DATE: September 24,2018
DEPARTMENT: Various
FUND: HoteUMotel(23),Parks Special(25)
Water&Sewer(50)
Solid Waste(52),Dispatch(70)
AMOUNT
CURRENT INCREASE PROPOSED
ACCOUNT NO. ACCOUNT TITLE BUDGET (DECREASE) BUDGET
23-0000-4393 Hotel Occupancy Tax 70,000 60,000 130,000
23-0000-6389 Payment to Chamber&Hist.Society 56,050 60,000 116,050
25-0000-6350 Buildings,Fixtures&Grounds - 11,200 11,200
25-0000-6720 Blds,Fixtures&Grounds 152,000 (11,200) 140,800
39-0000-4910 Transfer In - 50,000 50,000
50-6000-6256 Chemicals&Insecticides 300,000 (20,000) 280,000
50-6000-6323 Health Inspection Fees 18,200 2,810 21,010
50-6000-6404 Untreated Water 200,000 9,801 209,801
50-6100-6110 Salaries&Wages 238,302 7,000 245,302
50-6100-6393 Contractual Services 33,800 7,000 40,800
50-6200-6121 Group Insurance 35,558 (4,558) 31,000
50-6200-6222 Motor Vehide Fuel 4,000 2,000 6,000
50-6200-6348 Electricity 200,000 (20,000) 180,000
50-6300-6110 Salaries&Wages 442,215 3,000 445,215
50-6300-6111 Overtime 50,000 (7,000) 43,000
50-6300-6222 Motor Vehicle Fuel 22,000 (7,000) 15,000
50-6300-6247 Water&Sewer Mains 100,000 10,000 110,000
50-6300-6755 Water Distribution Lines 20,000 (5,130) 14,870
50-6300-6756 Sewer Collection Lines - 5,130 5,130
50-9000-6409 Vacation Buy Back 25,000 (25,000) -
50-9000-6411 Preventive Care Reimbursement 20,000 (20,000) -
52-0000-4360 Federal Emergency Mgmt Funds - 375,489 375,489
52-0000-4610 Interest Income 2,500 5,500 8,000
52-0000-4840 Solid Waste Service 1,575,000 47,215 1,622,215
52-3300-6110 Salaries&Wages 436,678 (12,000) 424,678
52-3300-6222 Motor Vehicle Fuel 63,000 17,000 80,000
52-3300-6258 Motor Vehicle Supplies 75,500 7,500 83,000
52-3300-6343 Insurance Motor Equipment 24,800 (5,200) 19,600
52-3300-6355 Vehicle&Equipment R&M 23,500 8,500 32,000
52-3300-6390 Waste Disposal 240,000 , 45,000 285,000
52-3300-6392 Disaster Debris Expense - 63,043 63,043
52-3000-6397 Green Waste Disposal 22,000 (2,000) 20,000
52-9000-6406 Contingency 45,306 (42,806) 2,500
52-9000-6411 Preventive Care Reimbursement 5,000 (5,000) -
70-2100-6110 Salaries&Wages 570,110 (4,000) 566,110
70-2100-6111 Overtime 55,000 16,000 71,000
70-2100-6113 Longevity 4,512 (1,500) 3,012
70-2100-6210 General Office Supplies 71,600 7,400 79,000
70-2100-6348 Electricity 9,000 (4,000) 5,000
TOTAL 5,210,631 624,194 5,834,825
JUSTIFICATION
End of year line-item correction
Dept.Head Signature: Date:
Finance Director: Date:
Date Approved: Date Posted:
Page of
ORDINANCE NO.2018-30
AN ORDINANCE ACCEPTING UTILITY ACCOUNTS
RECEIVABLE CHARGE-OFFS IN THE AMOUNT OF
$7,153.08 AS SHOWN IN ATTACHMENT"A"FOR THE
YEAR ENDED 9-30-18 IN THE CITY OF NEDERLAND.
WHEREAS,Generally Accepted Accounting Practices require that uncollectible
accounts receivable be written off to reflect accurate revenues;and,
WHEREAS,based on auditor recommendations it is desirable to present
uncollectible accounts to be charged off,
NOW,THEREFORE,BE IT ORDAINED BY THE CITY COUNCIL OF
THE CITY OF NEDERLAND,TEXAS:
Section 1.The City of Nederland's book of accounts of the Water
Billing/Collecting Department are hereby corrected to reflect the following charge-offs
for fiscal year 2017-18 in the amount of$7,153.08 as set forth in Attachment"A."
Section 2.Charge-offs affected by this Ordinance are for accounting purposes
only and are not to be construed as a release or forgiveness of indebtedness by the City.
This provision shall in no way be construed to waive or discharge or dispense with the
continued application of Section 106-32 of the Code of Ordinances concerning the
accounts hereby affected.
THAT this being an ordinance not requiring publication,it shall be effective from
and after its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
NEDERLAND AT A REGULAR MEETING THIS THE 24th day of September
A.D.,2018.
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City of Nederland,Texas
APPROVED AS TO FORM AND LEGALITY:
Jes•- Br. ' ' City Attorney
Ci I, of► derland,Texas
ATTACHMENT"A"
CITY OF NEDERLAND
ACCOUNTS TO BE WRITTEN OFF FOR FYE 2017-2018
Account Number Amount
02-0080-02-0 119.23
02-0300-04-0 81.58
02-1360-02-0 135.56
02-1920-06-0 58.67
02-2530-12-0 175.48
04-1350-07-0 36.31
04-1700-24-0 31.96
04-1740-04-0 137.92
04-4380-00-0 259.01
05-0310-06-0 78.15
05-0410-13-0 660.57
05-0510-07-0 12.39
05-0890-05-0 166.94
05-1840-08-0 31.20
05-1960-05-0 85.15
05-3130-07-0 101.92
05-3910-23-0 45.32
05-4047-05-0 20.70
06-1370-05-0 38.28
07-0880-06-0 103.73
09-0130-24-0 116.19
10-0730-06-0 25.35
10-5140-01-0 426.45
11-1690-00-0 107.51
11-1791-01-0 62.41
12-0435-03-0 204.97
12-1320-07-0 17.74
13-0500-08-0 15.96
13-1160-13-0 60.03
13-1180-07-0 49.44
13-1490-08-0 116.98
13-2065-10-0 47.83
13-2070-26-0 36.56
13-2128-09-0 130.21
15-0080-00-0 17.43
15-0390-02-0 94.07
15-0560-04-0 54.62
15-2320-10-0 10.64
15-2905-20-0 81.04
16-0660-17-0 47.86
16-1340-17-0 143.52
16-1368-27-0 28.49
16-1690-00-0 91.85
16-2110-06-0 88.58
16-2220-03-0 78.08
17-0210-00-0 190.24
18-0830-00-0 121.73
18-1120-03-0 108.98
18-1710-00-0 186.56
19-0060-04-0 110.97
19-0065-03-0 35.58
19-0270-02-0 31.96
19-1060-04-0 402.83
19-1540-03-0 40.03
19-2630-03-0 43.19
19-3080-04-0 588.26
20-0840-27-0 77.27
20-1110-06-0 15.73
20-1725-02-0 23.16
21-1850-00-0 11.30
ATTACHMENT"A" PAGE 2 OF 2
21-2440-04-0 64.29
22-2440-00-0 53.99
22-2708-10-0 300.55
23-1130-16-0 49.84
23-1160-01-0 70.34
24-0403-11-0 92.40
TOTAL. $7,153.08
ORDINANCE NO. 2018-31
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
NEDERLAND, TEXAS ESTABLISHING WATER AND SEWER
RATES, WATER METER DEPOSITS, WATER AND SEWER
CONNECTION FEES, WATER AND SEWER MAINTENANCE
FEES, TRASH REMOVAL, AND GARBAGE RATES, AND
PROVIDING FOR THE ADDITION OF STATE MANDATED
SALES TAX TO THE GARBAGE PORTION OF THE RATE,
INSIDE AND OUTSIDE THE CITY OF NEDERLAND, TEXAS,
AND FURTHER PROVIDING FOR INTEREST PENALTIES, RE-
CONNECTION CHARGES, TRANSFER FEES, AND RETURNED
CHECK FEES AND REPEALING ORDINANCE NO. 2017-18.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
NEDERLAND,TEXAS:
WHEREAS, a revision should be made in the rates for utility services now being
charged by the City of Nederland,Texas, inside the city limits and outside the city limits.
SECTION 1. Repeal of Previous Ordinances and Regulations.
1. All other ordinances and/or regulations governing City of Nederland (CITY) water and
sewer service in conflict with this ordinance are hereby repealed when this ordinance
takes effect, provided, however, the repeal of prior ordinances does not waive, excuse,
or vacate any balances due for water services provided hereunder and the CITY may
collect such balances due.
SECTION 2. Water and Sewer Systems.
1. The water system and sewer system are public utilities operated and maintained by the
CITY. The systems shall be operated in accordance with ordinances and policies adopted
by the CITY, State law, and/or Federal law. Subject to such requirements, the City
Manager may make such reasonable regulations as to govern the water and sewer
systems to ensure their continued operation.
2. For the purpose of this ordinance, the terms"water service"and "utility service" shall be
inclusive of water service, sewer service, and garbage/trash services as provided by the
CITY.
3. For the purpose of this ordinance,the term"customer"shall mean the person responsible
for payment and/or all persons acting for him/her or by his/her direction.
SECTION 3. Application for Water Service.
1. Any person and/or business desiring to obtain water service from the CITY shall make
application on a form supplied by the CITY. The application shall include:
a) name of the individual to be f) address to be served
responsible for the payment of g) address, if different from the service
utility service address, to which bills are to be sent
b) the social security number of the h) home telephone number
individual responsible for payment i) the signature of the individual
c) the driver's license number responsible for payment
d) the applicant's employer j) proof of identification
e) the applicant's work phone k) rental agreement, if applicable
number
2. The person responsible for the payment of utility service shall agree that he/she will abide
by all ordinances, rules, policies, and/or regulations governing water and sewer service
provided by the CITY.
SECTION 4. Installation of Service.
1. No private service lines shall be connected or tapped to any CITY water line unless a
meter is installed by the CITY at that connection.
2. No private service lines shall be connected to any CITY sewer line unless the
connection/tap has been made and/or approved by the CITY.
3. Not more than one (1) premise may be connected to any 1 water and/or sewer tap.
Exceptions may, however, be granted to this stipulation for situations involving a master
meter to serve apartment complexes, mobile home parks, etc.
4. No person shall make or permit to be made any subsidiary connection of another's
premises with his/her water or sewer service.
5. If approved by the CITY, additional water services may be provided to residences and/or
businesses for water to be utilized for purposes such as outside watering, swimming
pools, etc. In this situation, water provided by such separate service will not be
discharged through the CITY's sewer system.
SECTION 5. Water Connection/Taps and Sewer Connection/Taps.
A. GENERAL
1. The CITY reserves the right to tap existing CITY water lines, set water meters, and
require use of CITY taps and meters and reserves the right to tap existing CITY sewer
lines.
2. Any individual or business desiring a water tap and/or a sewer tap shall make said
request to the CITY. If said request, in the CITY's opinion, is beneficial to the CITY
and/or does not endanger the existing water line(water system)and/or the sewer line
(sewer collection system),the CITY shall provide all materials, labor and equipment to
tap the existing water line and/or existing sewer line.
3. The CITY shall make the final determination as to the location of the water and/or
sewer tap.
4. If street excavation is required, the following fees will be assessed in addition to the
fees listed below:
Additional Cost for Street Excavations
Excavation Length Asphalt Concrete
5'or less $730 $1,650
10'or less $1,000 $2,200
15'or less $1,275 $2,400
20'or less $1,525 $3,425
25'or less $1,800 $3,650
30'or less $2,075 $4,000
31'or more Cost will be calculated Cost will be calculated
B. WATER TAPS
1. The water connection fees are as follows:
Inside City Outside City .
(No Street Excavation) (No Street Excavation)
3/4"Water Tap $ 500 $ 675
1"Water Tap 600 800
1'/:"Water Tap 1,150 1,400
2"Water Tap 1,450 1,750
2"Compound 2,500 2,800
Over 2"Water Tap Cost Cost x 1.5
2. In return for payment of such fee, the CITY shall tap the existing water line and install
a water meter. The fee does not include the cost of the meter deposit as provided in
Section 6.
C. SEWER TAPS
1. The sewer connection fees are as follows:
Inside City Outside City
(no street excavation) (no street excavation)
4"up to 5'deep $200 $300
4"from 5'to 10'deep $450 $550
6"up to 5'deep $300 $400
6"from 5'to 10'deep $550 $650
8"up to 5'deep $400 $500
8"from 5'to 10'deep $650 $750
More than 10'deep Actual cost
D. NEW SUBDIVISION WATER AND SEWER TAP FEES (INSTALLED BY DEVELOPER)
Tap Size Inside City Outside City
3"Water $250 N/A
1"Water $350 N/A
4"Sewer $300 N/A
SECTION 6. Water Meter and Garbage Container Deposits.
1. In order to establish water, sewer, and garbage service, an applicant for said services
shall be required to pay a deposit to the CITY in accordance with the following schedule
(excludes residential rental property in renter/tenant's name):
Inside City Outside City
3/4"and Smaller Water Meter $110 $110
1"Water Meter 160 160
1'A"Water Meter 210 210
2"and Larger Water Meter 310 310
2. Residential Rental Property Deposit: In order to establish water, sewer, and garbage
service, an applicant, who is not the property owner, for said services shall be required
to pay a deposit to the CITY in accordance with the following schedule (excludes
apartment complexes and duplexes without individual water meters for each unit):
Inside City Outside City
3/4"and Smaller Water Meter $225 $225
1"Water Meter 225 225
3. In order to be provided with an additional garbage container, which shall be limited to
one additional garbage container per residential account (two total) and three additional
per commercial account (four total), an applicant shall be required to pay an additional
deposit of$75.00 per additional container. No deposit will be required if customer has
paid his bill in full by the due date specified on each individual bill for a period of twelve
(12) consecutive months immediately prior to the request for an additional garbage
container.
SECTION 7. Application of Deposit.
1. Upon the termination of water service,at the request of the customer, the deposit or any
portion of the deposit remaining shall be returned to the customer when water and all
other charges have been paid, as well all trash has been cleared from the property in
accordance with this ordinance and the garbage cans have been collected.
2. Current customers, who have service in their name, who continue to maintain utility
service and who have, each month, paid their bill in full and by the due date specified on
each individual bill for a period of 12 consecutive months shall, at their request, be
refunded the full amount of their deposit.
3. Tenants, who rent residential property from a property owner that elected to not have
service in their own name, shall be refunded the full amount of their deposit if they
continue to maintain utility service and pay their bill in full and by the due date specified
on each individual bill for a period of forty-eight (48) consecutive months.
SECTION 8. Previous Service-Outstanding Balance.
Any applicant requesting water service from the CITY who currently has or previously had
CITY water service and has, at the time of application, an outstanding balance on his/her
previous water service must pay the outstanding balance in full in addition to the meter
deposit prior to receiving new service.
SECTION 9. Water Rates.
The following monthly rates shall be charged for water service:
Inside City Outside City
First 2,000 Gallons(minimum)* $10.00 $14.55
Each additional 1,000 gallons** (up to 2.85 4.60
50,000 gallons)
Each additional 1,000 gallons above 2.86 4.61
50,000 gallons
Water Line Maintenance— 0.34 0.34
per 1,000 gallons(above minimum)
* Effective July 1,2007,where water service is provided to multiple units served by one meter,the minimum
rate for the first 2,000 gallons will be charged for each unit based upon ninety percent(90%)occupancy of the
total number of units.
** Except as required by provisions of outside CITY contracts.
The City may permit contractors engaged by the City for City construction project to utilize
potable (bulk water) with the permission of the Public Works Director and the City Manager.
Otherwise, no bulk water sales are permitted.
SECTION 10. Sewer Rates.
The following monthly rates shall be charged for sewer service:
Inside City Outside City
First 2,000 Gallons(minimum)* $10.65 $16.45
Each additional 1,000 gallons** (up to 4.60 6.05
50,000 gallons)
Each additional 1,000 gallons above 4.81 6.26
50,000 gallons
Sewer Line Maintenance— 0.34 0.34
per 1,000 gallons(above minimum)
* Effective July 1,2007,where water service is provided to multiple units served by one meter,the minimum
rate for the first 2,000 gallons will be charged for each unit based upon ninety percent(90%)occupancy of the
total number of units.
** Except as required by provisions of outside CITY contracts.
SECTION 11. Garbage Rates.
RESIDENTIAL ACCOUNTS
All residences inside the CITY limits shall be required to use the CITY garbage service in
accordance with the following schedule:
Inside City Rate(per month) $ 19.75+sales tax*
Additional Container** $ 8.65+sales tax*
COMMERCIAL ACCOUNTS
Businesses inside the CITY limits may elect to utilize the CITY garbage service in accordance
with the following schedule:
Inside City Rate(per.month) $ 19.75+sales tax*
Each Additional Container** $ 10.00+sales tax*
No more than 3 additional containers
Businesses inside the CITY limits may elect to utilize the CITY garbage service and not receive
twice a month trash service in accordance with the following schedule:
Inside City Rate(per month) $ 12.75+sales tax*
Each Additional Container** $ 10.00+sales tax*
No more than 3 additional containers
*Sales tax shall be in an amount required by law
**Customers requesting additional containers must have sufficient space on their residential or business lot to
accommodate the necessary spacing. The City Manager or his designee have the authority to decide whether a
customer has sufficient space.
The Public Works Director may require any residential or commercial generator who regularly
exceeds the provided garbage can load and/or weight capacity within a collection period, or
any customer who regularly generates refuse requiring special handling to use a private
commercial disposal system or to make other approved disposal arrangements.
Garbage bags will be available at City Hall for purchase by customers. The fee for garbage
bags is $7.00 per roll of bags.
SECTION 12. Billing and Penalty.
1. All charges on utility service bills shall be due and payable to the CITY fifteen (15) days
after the date the bill is mailed to the person responsible for payment.
2. If payment is not received by the sixteenth (16th)day,a ten percent(10%) penalty shall
be assessed.
Y
3. Notwithstanding the provisions of 1 and 2 above, in accordance with Section 182.002 of
the Texas Utilities Code, the 10% penalty shall not be applied to persons age 60 or older
until the 25th day after the date on which the bill was issued, provided that such person
has made a request for delay, presented reasonable proof of their age,and is a residential
customer who has occupied, and shall continue to occupy, the entire premises for which
a delay is requested.
4. Should the 15th day fall upon a weekend, holiday, or any day that the City Hall Building
is closed, a grace period of two (2) business days shall be granted.
SECTION 13. Delinquency-Termination of Service.
1. If full payment is not received by the CITY by the next date at which the water meter is
read, a subsequent utility bill shall be mailed for the current reading plus the amount
owed on the previous billing including the 10% penalty; this does not apply to residential
rental property classified as"Elevated Risk."
2. If full payment is not received on the date on which the subsequent utility bill Is due, all
utility service shall be disconnected. A final notice via telephone call or mail shall be sent
to the customer on the Thursday following the due date indicating that services shall be
disconnected on the Wednesday immediately following the issuance of such notice. If
payment in full is not received by 5PM on the due date, then a cut-off work order will be
issued. Once the cut-off work order is issued, a reconnection fee and any additional
deposit shall be due in addition to the previous balance.
SECTION 14. Re-connection Charges.
1. Should utility service be discontinued due to non-payment of a utility bill, all funds due
to the CITY, in addition to a re-connection fee shall be paid prior to reinstatement of
utility service. The re-connection fee shall be $30.00 if reinstatement of utility service
is requested during working hours (8:00 a.m. to 4:30 p.m., Monday through Friday). A
customer will be required to keep a minimum $210 deposit on file or a $325 deposit for
residential rental property accounts in addition to the account balance and reconnection
fees before utility service is reconnected.
2. Should service be discontinued, the CITY shall install a lock on the water meter. Should
the customer or any person tamper with the lock and damage it, the following fees shall
be assessed: 1st offense- $100 and 2nd and/or subsequent offense- $250. This fee shall
be paid, in addition to all other charges, prior to reinstatement of service.
3. Should any person turn on water service, after the CITY has discontinued the service for
non-payment, such action shall be considered a criminal offense.
4. Should a customer be repeatedly disconnected due to non-payment, the CITY may
require the following:
a) Payment for the delinquent bill in the form of cash, money order, and/or cashier's
check.
b) The CITY retains the option of requiring payment for utility bills by cash, money
order, and/or cashier's check for all future utility billings.
5. If payment is made with a check returned insufficient funds due to the issuance of a
disconnection notice, water will be immediately disconnected.
SECTION 15. Transfer Fee.
A transfer fee, in the amount of$15.00, shall be assessed for transferring service within the
CITY's utility service system. The final bill of the transferred account plus $15.00 will be
added to the customer's new account.
SECTION 16. Returned Check Fees.
1. Any customer who pays his/her utility bill with a check which is returned from the financial
institution due to, but not limited to, insufficient funds and/or closed account shall be
assessed a $30.00 fee.
2. The CITY may,at the request of the customer, re-run the check. If the check is accepted,
the fee shall be waived. However, if the check continues to be returned, the CITY shall
require that the bill be paid by cash, money order, cashier's check, or credit card.
3. The CITY retains the right to prosecute for returned checks in accordance with the Texas
Penal Code.
4. If a check is returned unpaid due to the financial institution error,the financial institution
shall submit written verification of such error. In this situation, the fee shall be waived.
5. Should a customer have two (2)or more checks returned due to insufficient funds and/or
closed account within a period consisting of twelve (12) consecutive months, the CITY
shall no longer accept checks from that individual for a period of 24 months. During the
24 month period, all payments shall subsequently be made in the form of cash, money
order, cashier's check, and/or credit card.
SECTION 17. Temporary Service.
1. Should a customer request temporary service, no deposit shall be required, unless the
customer is in arrears on other accounts.
2. The duration of such temporary service shall not exceed 15 calendar days. Customer
shall be billed for actual usage.
3. Should the account become delinquent, the customer shall not be allowed to begin any
new service until all delinquent monies are paid.
SECTION 18. Failure to Receive a Bill.
1. All bills for utility service shall be rendered monthly in accordance with a schedule
established by the CITY. The CITY shall exercise care in the delivery of utility bills, but
is NOT responsible for the service provided by the United States Postal Service.
2. Failure to receive a bill shall not relieve the customer for payment of service received
within the prescribed period nor exempt him/her from the responsibility imposed for
delinquent accounts.
SECTION 19. Deferred Payments.
1. The City Manager and/or his/her designee shall be empowered to develop payment
schedules should a customer be unable to pay his/her bill. The City Manager may not
develop payment schedules should a customer be unable to pay his/her bill if the
outstanding balance is greater than $500.00.
2. Should a customer not be able to pay his/her account by the due date, he/she must
contact the CITY prior to the due date and request that a payment schedule be developed.
3. Should a customer not contact the CITY prior to the issuance of a disconnection notice,
he/she shall be required to pay the entire amount of the bill in order to retain water
service.
4. The customer and the CITY may develop a payment schedule which shall be documented
on a form supplied by the CITY. This form shall include, but not be limited to, the
following information: dates of future payments, amounts of future payments; and
signature of the customer. Should the customer subsequently not comply with the
payment schedule, water service shall be disconnected and shall not be reinstated until
the full amount owed on the bill is paid.
5. In no case shall the CITY abdicate the right to refuse a payment schedule as presented
by the customer.
6. If a customer fails to comply with the provisions of their payment schedule, he/she shall
not be permitted to establish additional payment schedules until full payment has been
received on the initial/existing payment schedules.
SECTION 20. Adjustments.
1. The City Manager and/or his/her designee shall be empowered to make adjustments on
utility bills when an investigation reveals that the meter charges are excessive in
comparison to previous billings due to inadvertent misfortune or inadvertent damage to
a customer's pipes and plumbing. Customer must show proof leak has been repaired
before issuance of adjustment.
2. Any adjustments made to the utility bill shall be made to the cost for sewer service,
including base rate and maintenance fee. An adjustment will be made based upon an
average of six monthly bills during the previous six-month period.
3. In the event that water usage during the billing period exceeded 50,000 gallons,the cost
of water shall be adjusted by one-third (1/3) of the excess water usage based upon an
average of six monthly bills during the previous six-month period. Such an adjustment,
however, shall only be made for those customers whose monthly bill averages less than
50,000 gallons based upon an average of the preceding 12 months. Any adjustment to
the cost of water shall only be made if the customer provides verification that a leak
existed and that repairs have been made.
4. In no case shall a sewer adjustment be granted if the CITY notified the customer of a
potential water leak on his/her property.
5. Sewer adjustments will be limited to one per 12-month period. Sewer adjustments shall
not exceed $2,500 unless approved by the City Council.
6. A sewer adjustment will be granted the first time a swimming pool is filled upon
construction. To be eligible for an adjustment,the customer must have a Building Permit
issued by the City of Nederland Inspections Department.
7. Any suspected billing errors should be reported to the Billing &Collections Department
when the billing error is discovered. If a billing error did occur, an adjustment will be
calculated to correct the error. However, adjustments will be limited to the previous
twelve months billing and require the city manager's approval.
SECTION 21. Meter Tampering.
1. It is unlawful for any person to turn on water to any premises from the CITY water system
without first obtaining approval from the CITY.
2. It is unlawful for any person to connect water service to a premises after service has
been terminated by the CITY.
3. It is unlawful to interfere with, disturb or damage in any manner or form any water
meters, locks, cutoff valves, or other appliances of the CITY. The head of household or
property owner involved shall be held responsible for the violation of this section.
4. Tampering fees of up to five hundred dollars ($500.00) shall be assessed where a meter
has been interfered with, disturbed,or damaged.
SECTION 22. Trash Removal Rates.
1. Trash blocking drainage-a service fee of$50.00- $200.00 will be charged to the owner
of the property when it becomes necessary to clear a ditch of trash and/or debris during,
before, and/or after a rainstorm to prevent possible flooding. The fee shall be based
upon the amount of work performed by the CITY. The City shall document the work and
add the service fee on the customer's next bill; the next month bill will be the customer's
notice.
2. Miscellaneous trash and/or debris, defined as green waste and/or any other bulky items
not able to be placed into the standard CITY garbage container,from empty(undeveloped
or vacant) property must be hauled off by the owner or developer at their expense.
Violations of said policy will be forwarded to the City's Code Enforcement Department for
compliance. The City shall not reconnect services until said violation has been resolved
by the Code Enforcement Officer and/or Municipal Court.
3. The CITY will provide collection of trash to residential and commercial customers receiving
garbage service twice per month. The amount of trash removed shall be limited to four
(4)cubic yards per collection. Trash piles greater than the prescribed 4 cubic yards must
be removed from the property within ten (10) calendar days or violations may be
forwarded to the City's Code Enforcement Department for compliance. If the City's Code
Enforcement Officer tags the pile in violation, the City solid waste service shall not pickup
that trash. The CITY shall not provide this service to vacant properties or those properties
without an active account. Green waste and trash will not be removed if it is co-mingled.
4. Should an owner of property or customer within the CITY request the removal of trash,
the CITY may do so at a cost equivalent to the actual costs of personnel,equipment,and
disposal fees but no less than $20.00 per cubic yard per collection for quantities greater
than four cubic yards. Payment must be made to the City prior to the trash being
collected. The amount of trash to be collected shall not exceed four (4) cubic yards at
any one time. Such service shall be provided at the discretion of the CITY dependent
upon such factors including, but not limited to, existing work load,and scheduling. This
provision shall not apply to the accumulation of trash due to work performed by
contractors and/or individuals/companies hired by the property owners. The placement
of the trash in quantities greater than four cubic yards shall constitute the owner or
customer's request for said service and acceptance of prescribed fees.
SECTION 23. Validation.
If any section, paragraph, subdivision, clause, phrase or provision of this ordinance shall be
adjudged invalid or held unconstitutional, the same shall not affect the validity of this
ordinance as a whole or any part or provision thereof other than the part so decided to be
invalid or unconstitutional.
This ordinance shall take effect October 1, 2018.
PASSED AND APPROVED by the City Council of the City of Nederland,Texas at a special
meeting this the 24TM day of SEPTEMBER 2018.
19)
_>-:��� i� V�/'�= R. A. Nugent, ��ayor
, City of Nede r-nd,Texas
ay FergYison, City rk�
City of Nederland,Texas
APPROVED AS TO FORM AND LEGALITY:
•
AIM
i%:
Jesse :ranic d Attorney
City Ned- land,Texas