1 2 3 4 5 6 7 8 KERR COUNTY COMMISSIONERS COURT 9 Special Session 10 Monday, May 24, 2010 11 9:00 a.m. 12 Commissioners' Courtroom 13 Kerr County Courthouse 14 Kerrville, Texas 15 16 17 18 19 20 21 22 23 PRESENT: PAT TINLEY, Kerr County Judge H. A. "BUSTER" BALDWIN, Commissioner Pct. 1 24 WILLIAM "BILL" WILLIAMS, Commissioner Pct. 2 JONATHAN LETZ, Commissioner Pct. 3 25 BRUCE OEHLER, Commissioner Pct. 4 2 1 I N D E X May 24, 2010 2 PAGE --- Visitors' Input 5 3 --- Commissioners' Comments 6 4 1.1 Consider/discuss, take appropriate action to appoint Deborah Rickard as a member of the 5 Kerr County Child Services Board 13 6 1.3 Consider/discuss, take appropriate action to set a public hearing to discuss County Clerk's 7 annual plan for funding the preservation and restoration of County Clerk's records archive 13 8 1.2 Open bids for Kerrville South Wastewater Project 9 and refer bids to appropriate personnel for consideration and recommendation; take 10 appropriate action as necessary to award bid(s) 14 11 1.8 Consider/discuss, take appropriate action for approval to purchase an equipment haul truck 12 with surplus sale funds 16 13 1.11 Consider/discuss, take appropriate action concerning changes to jail commissary contract 18 14 1.14 Consider/discuss, take appropriate action to 15 allocate surplus 2010 capital funds unused by Sheriff's Office to purchase vehicles 21 16 1.17 Consider/discuss, take appropriate action on 17 authorizing County Surveyor to do preliminary site work for new outdoor arena at Hill Country 18 Youth Exhibit Center 23 19 1.4 Public Hearing on proposed speed limit and speed limit signs on Backacre Road, Precinct 1 25 20 1.5 Consider/discuss, take appropriate action to 21 approve recommended speed limit for Backacre Rd. and approve speed limit signs to be installed 26 22 1.16 Consider/discuss, take appropriate action on 23 resolution to LCRA regarding CREZ power lines in Kerr County 28 24 1.6 Public Hearing on proposed speed limit and speed 25 limit signs on Lower Reservation Rd., Precinct 4 43 3 1 I N D E X (Continued) May 24, 2010 2 PAGE 1.7 Consider/discuss, take appropriate action to 3 approve recommended speed limit for Lower Reservation Road; approve speed limit signs 43 4 1.18 Consider/discuss, take appropriate action on 5 calling for road district in a portion of Lazy Valley Subdivision; set public hearing for same 45 6 1.19 Consider/discuss, take appropriate action on 7 calling for road district in a portion of Castle Lake Subdivision; set public hearing for same 48 8 1.9 Take appropriate action to award contract(s) 9 for demolition and construction of outdoor arena at Hill Country Youth Exhibit Center 49 10 1.10 Consider/discuss, take appropriate action to 11 approve basic financial statement & supplementary information audit for period ending 9-30-2009 54 12 1.12 Consider/discuss, and take appropriate action to 13 approve Kerr County Retiree Health Care Plan actuarial valuation report as of 12-31-2008 76 14 1.13 Consider/discuss, take appropriate action to 15 approve disposition policy 90 16 1.15 Consider/discuss, take appropriate action to approve Kerr County Policy Book revisions and 17 the change to mirror Sheriff's Office format 94 18 1.20 Consider/discuss, take appropriate action on right of way acquisition at Hermann Sons Road 98 19 1.21 Consider/discuss, take appropriate action on 20 property acquisition in east Kerr County for a Road and Bridge equipment yard 100 21 4.1 Pay Bills 103 22 4.2 Budget Amendments 107 4.3 Late Bills 109 23 4.4 Approve and Accept Monthly Reports 110 24 5.1 Reports from Commissioners/Liaison Committee Assignments 110 25 5.2 Reports from Elected Officials/Department Heads 111 --- Adjourned 130 4 1 On Monday, May 24, 2010, at 9:00 a.m., a special 2 meeting of the Kerr County Commissioners Court was held in 3 the Commissioners' Courtroom, Kerr County Courthouse, 4 Kerrville, Texas, and the following proceedings were had in 5 open court: 6 P R O C E E D I N G S 7 JUDGE TINLEY: Good morning, ladies and gentlemen. 8 Let me call to order this regularly scheduled meeting of the 9 Kerr County Commissioners Court scheduled and posted for this 10 date and time, Monday, May 24th, 2010, at 9 a.m. It is that 11 time now. Commissioner Oehler? 12 COMMISSIONER OEHLER: Yes, sir. Will you join me 13 in a word of prayer and pledge of allegiance? 14 (Prayer and pledge of allegiance.) 15 JUDGE TINLEY: Thank you. Be seated, please. At 16 this time, if there's any member of the audience or public 17 that wishes to be heard on any matter that is not a listed 18 agenda item, this is your opportunity to come forward and 19 tell us what's on your mind. If you do wish to be heard on 20 an agenda item, we'd ask that you fill out a participation 21 form. There should be some located at the rear of the room. 22 That helps me not miss you when we come to that item. If 23 they don't happen to be there, or if you don't happen to fill 24 one out, and we get to an agenda item you feel like you want 25 to be heard on, get my attention in some manner; I will give 5-24-10 5 1 you the opportunity to be heard on that matter. But right 2 now, if there's any member of the audience or public that 3 wishes to be heard on any matter that is not a listed agenda 4 item, come forward at this time and give us your name and 5 address, tell us what's on your mind. 6 MR. VINYARD: David Vinyard, 612 Elm Street, 7 Kerrville. I'm here this morning, Commissioners, Judge, to 8 represent Kerrville Gateway, Gulf Coast Commercial. And in a 9 discussion among the development team, it occurred to us that 10 there is both profound economic and financial impact to Kerr 11 County based on the proposal that Kerrville Gateway seeks to 12 make to the City of Kerrville. I wanted to offer, in future 13 session, the possibility to give you a financial briefing on 14 tax and employment benefits of this proposal. Should you 15 like, we would be happy to do that, and I thank you very 16 much. 17 JUDGE TINLEY: You're asking to be placed on the 18 agenda? 19 MR. VINYARD: Yes, sir. 20 JUDGE TINLEY: So you can tell us all about this? 21 MR. VINYARD: Yes, sir. 22 JUDGE TINLEY: And is there any particular time 23 that you'd like to be placed on the agenda? 24 MR. VINYARD: No, sir. At the convenience of the 25 Court. 5-24-10 6 1 JUDGE TINLEY: Okay. Sooner the better? 2 MR. VINYARD: Sooner the better. 3 JUDGE TINLEY: Okay, I think we can accommodate 4 that. Be the second -- second Monday in June. 5 MR. VINYARD: Very well. Thank you. 6 JUDGE TINLEY: All right. Thank you. Anyone else 7 wishing to be heard on any matter that is not a listed agenda 8 item? If not, we'll move forward. What do you have for us 9 this morning, Commissioner Oehler? 10 COMMISSIONER OEHLER: Well, I'm sure a lot of 11 people know my wife broke her hip last week, so I've kind of 12 been out-of-pocket. But I appreciate all the prayers and all 13 of the people that have offered to help, and -- and those who 14 have showed an interest and been kind. That's it. 15 JUDGE TINLEY: Thank you. Commissioner Baldwin? 16 COMMISSIONER BALDWIN: Yes, sir. I have a couple 17 of things I wanted to talk about. This coming Thursday, 18 we're having dinner on the grounds here at 11:45. I want to 19 remind you that the reason that we do this is to have the 20 business people or anybody in the community of Kerr County to 21 bring your sack lunch and come down to the court -- your 22 courthouse lawn and set up and have lunch, and we provide 23 some entertainment. This week we have a group called 24 Southwind that are coming here, and it's a group of dulcimer 25 players. And there's mandolin and guitar and some other 5-24-10 7 1 things in there, but it's about 12 dulcimer players. First 2 time I've heard anything like it. Beautiful instruments and 3 beautiful sounds, and they are a lot of fun. And they'll 4 start playing at about 11:45, so bring your lunch and don't 5 be late. 6 Another issue that's not quite as fun for me is, 7 for a number of years now, every time that -- seems like that 8 we start doing something out at the Ag complex, there is a 9 group of folks that act like little girls to me. They get 10 off out behind the barn and start talking about how goofy we 11 are and how much we don't like the ag youth in Kerr County 12 and all that. You know, we've heard it over and over again. 13 Well, that has popped up again, and I personally am tired of 14 it. So, what I want to do, I've got -- I've got a small list 15 going of names, and I'm going to -- I want to invite them to 16 either the Commissioners Court, or we can do a workshop, 17 either way we want to do it; I couldn't care less. But I 18 want them to come in this room and look us in the face and 19 tell us what it is that their problem is so that we can fix 20 it and move on, and stop all this back-biting and -- I don't 21 know what you call it. I'll tell you what I think you call 22 it, but I'm not going to do it here in public. But I'd like 23 to -- I'd like to do that. And so if you have a thought 24 about whether we want to do it in a regular Commissioners 25 Court meeting or as a workshop issue, be thinking about that, 5-24-10 8 1 and I'll -- Jody, she's dying to poll y'all on that, and so 2 we'll do that in the next few days. But, thank you. I feel 3 better. 4 JUDGE TINLEY: Thank you. 5 COMMISSIONER BALDWIN: Yeah. Not real good, but I 6 feel better. 7 JUDGE TINLEY: I see. Commissioner Williams? 8 COMMISSIONER WILLIAMS: Nothing this morning, 9 Judge. 10 JUDGE TINLEY: Commissioner Letz? 11 COMMISSIONER LETZ: A lot of things on the agenda 12 today, but just one thing as public comment. At 1 o'clock on 13 Saturday was the event -- the historical marker for the Apelt 14 Armadillo Farm in east Kerr County. It was -- according to 15 the Historical Commission of Kerr County, the largest event 16 of that type they've ever had; over 200 people there. The 17 Apelt family came from as far away as Virginia, came down for 18 it. Really nice function, and I just want to thank the 19 Maintenance Department. We took a podium and about 100 20 chairs down there to help with it, and they needed every one 21 of those chairs. But, really good event. And I want to 22 thank the Historical Commission; they did a really good job 23 working it out and putting that together, and Dr. Luther did 24 a great job of putting a lot of the historical information 25 together and working with the Apelt family and Mrs. Norman to 5-24-10 9 1 get that all accomplished. That's it. 2 JUDGE TINLEY: Okay. Couple of items I'd like to 3 bring to your attention. You mentioned the Thursday dinner 4 on the grounds. Thursday evening, Bank of the Hills has its 5 annual Memorial Day event there at the bank called Heroes 6 All. It will begin, I believe, at 6 p.m., when they have the 7 fly-over. If you've not witnessed that event, you've missed 8 something. Just the fly-over, that's -- that's worth going, 9 just for that one purpose. I don't know how Mr. Griffin 10 manages to keep his stroke with that -- with that fighter 11 wing intact so that they come up here and do that, but I'm 12 grateful for it, because it truly adds something. 13 MR. VINYARD: It's their favorite fly-over. 14 JUDGE TINLEY: Pardon? 15 MR. VINYARD: It's their favorite fly-over. 16 JUDGE TINLEY: Well, I hope it continues to be 17 that, because it really, really adds something to the 18 Memorial Day purpose, and I'm glad to see that happen. Also, 19 the Memorial Day events, there will be a Memorial Day event 20 at the V.A. Hospital at 10 a.m. on May the 31st, and here at 21 the courthouse Monday, which is a courthouse holiday, at 2 22 p.m. The one at the V.A. will be in front of the hospital, 23 not around off of Spur 100 at the national cemetery. So, we 24 invite everybody to come and attend those. The economic 25 development -- board of the new economic development 5-24-10 10 1 organization has issued a tentative date of July the 29th to 2 roll out that new organization. It will be done at a public 3 meeting for all concerned, and we're hopeful that as many of 4 the stakeholders and business people and citizens as possible 5 can attend. Not certain as to the location yet. Just want 6 to let everybody know that -- to put that on their radar 7 screen so that if they have an opportunity to be present, 8 they can. I've also been asked to announce that the season 9 ticket applications for Symphony of the Hills are currently 10 being received. If you -- if you wish to apply for those 11 tickets, you can get the application over at the Cailloux box 12 office over at the Cailloux Theater in the -- be the 900 13 block of Main Street. 14 The new building out at the Sheriff's Office 15 complex, in case some of you haven't been by there, it's 16 starting to take pretty good shape. Couple of trucks rolled 17 in early Thursday morning with a lot of steel on it, and by 18 Friday evening, there was the beginning of the 19 superstructure -- the red iron superstructure for the 20 building itself, so that thing is starting to take shape. If 21 you happen to be over in that area, take a look at it and see 22 what you think. Road and Bridge continues to do an 23 absolutely wonderful job out there with all that they're 24 doing with the drainage issues, the parking and all of those 25 issues being involved, and they continue to do great work, 5-24-10 11 1 and we appreciate what they're doing out there. 2 COMMISSIONER WILLIAMS: Judge? 3 JUDGE TINLEY: Yeah. 4 COMMISSIONER WILLIAMS: I'm surprised Peter Lewis 5 didn't stick his hand up and announce that the Texas State 6 Arts and Crafts Fair opens its four-day stint this weekend. 7 MR. LEWIS: The official Arts and Crafts Fair of 8 the State of Texas is our annual event, and we have -- it 9 kicks off on Friday night with a wine and beer event, which 10 has become quite a community event. And then, of course, on 11 Saturday, Sunday, and Monday, we have a bunch of new artists, 12 a bunch of young artists, more artists than we had last year. 13 We expect just a gangbuster fair, so everyone is invited. 14 COMMISSIONER BALDWIN: Better? 15 MR. LEWIS: Yes, sir. 16 COMMISSIONER BALDWIN: While we're here, who is 17 sponsoring the wine and cheese on Friday? 18 MR. LEWIS: Well, sir -- shoot. I think it's J.M. 19 Lowe General Contractors. Yes, sir. 20 COMMISSIONER WILLIAMS: And isn't the music 21 provided by the Grateful Geezers, which most of us are? 22 (Laughter.) 23 MR. LEWIS: Yes, sir. Yes. There's a variety, but 24 yes, that evening the Grateful Geezers, and we are all 25 grateful, yes. 5-24-10 12 1 JUDGE TINLEY: Some of us may not be grateful, but 2 we still qualify as geezers. The hours for the fair, by the 3 way, if I recall correctly, on Saturday -- the fair will not 4 be open Friday evening, as it has been sometimes in the past. 5 It will be open Saturday and Sunday from 10 a.m. to 6 p.m. 6 MR. LEWIS: Yes, sir. 7 JUDGE TINLEY: On Monday, the hours are shortened a 8 bit from 10 a.m. to 4 p.m., so make your plans. The weather 9 forecast is to be plenty hot, but -- but dry. I don't know 10 how that relates to the humidity. The humidity may be a 11 little stronger than people like, but if you're coming from 12 San Antonio, Houston, or Corpus, you should find it quite 13 pleasant. But we look forward to everybody being there. 14 MR. LEWIS: I will add that it rains every Memorial 15 Day. 16 SHERIFF HIERHOLZER: Yes. 17 MR. LEWIS: So we have prepared this year with 18 ponchos and umbrellas and temporary walkway things, and so 19 we're pretty sure it's guaranteed not to rain, because we are 20 prepared. (Laughter.) 21 COMMISSIONER WILLIAMS: And plenty of bales of 22 straw, right? 23 MR. LEWIS: Yes, sir. 24 COMMISSIONER WILLIAMS: What about for wind? 25 MR. LEWIS: Next year. (Laughter.) 5-24-10 13 1 JUDGE TINLEY: Okay, let's get on with the agenda. 2 I'll go to the first item on the agenda, to consider, 3 discuss, take appropriate action to appoint Deborah Rickard 4 as a member of the Kerr County Child Services Board. 5 Commissioner Baldwin? 6 COMMISSIONER BALDWIN: Yes, sir. I just wanted 7 to -- my dear friend sitting next to me here, Kathy, signed 8 off on this, so I'm certainly in favor of it. So, I move for 9 approval of the agenda item. 10 COMMISSIONER WILLIAMS: Second. 11 JUDGE TINLEY: Motion made and seconded for 12 approval. Question or discussion on the motion? All in 13 favor of the motion, signify by raising your right hand. 14 (The motion carried by unanimous vote.) 15 JUDGE TINLEY: All opposed, same sign. 16 (No response.) 17 JUDGE TINLEY: That motion does carry. Item 2 on 18 the agenda; consider, discuss, and take appropriate action to 19 set a public hearing to discuss the County Clerk's annual 20 plan for funding the preservation and restoration of the 21 County Clerk's records archive. This was placed on the 22 agenda at the request of the County Clerk. She's asking for 23 a public hearing to take that matter up as required by 24 statute. Do you have any particular date that you're asking 25 for? 5-24-10 14 1 MS. PIEPER: No, sir. We just have to have it 15 2 days -- the notice published 15 days prior to the hearing. 3 JUDGE TINLEY: Okay. I don't believe -- if it's 15 4 days before the date of the hearing, we could probably do 5 that in June, because we're going to have three weeks until 6 our next meeting. So, how about we do it at 10 a.m. on -- be 7 the 14th, looks like. June 14th. 8 COMMISSIONER BALDWIN: So moved. 9 COMMISSIONER LETZ: Second. 10 JUDGE TINLEY: Motion made and seconded to conduct 11 a public hearing on the agenda item for June 14th, 2010, at 12 10 a.m. Question or discussion on the motion? All in favor 13 of the motion, signify by raising your right hand. 14 (The motion carried by unanimous vote.) 15 JUDGE TINLEY: All opposed, same sign. 16 (No response.) 17 JUDGE TINLEY: The motion does carry. Our 9:15 18 timed item, which is exactly where we are now, is to open the 19 bids for the Kerrville South Wastewater Project, refer bids 20 to appropriate personnel for consideration and 21 recommendation, and take appropriate action as necessary to 22 award the bids. You asked that this item be placed on the 23 agenda, Commissioner Williams. 24 COMMISSIONER WILLIAMS: Yes, sir. 25 JUDGE TINLEY: Looks like we have one bid; is that 5-24-10 15 1 correct? 2 COMMISSIONER WILLIAMS: That's all I know about, 3 Judge. 4 JUDGE TINLEY: Okay. 5 COMMISSIONER WILLIAMS: Cheryl, is that it? 6 THE CLERK: That's the only one. 7 JUDGE TINLEY: Okay. 8 COMMISSIONER BALDWIN: Boy, these tough decisions. 9 This is going to be a tough one. 10 COMMISSIONER WILLIAMS: It is going to be. 11 JUDGE TINLEY: The -- the bid submitted is on 12 behalf of Lupe Rubio Construction Company. The base bid, 13 $481,144. Alternate 1, $62,807. Those are the only two 14 numbers called for in the bid documents. Best I can tell 15 from a cursory examination, the bid is in compliance with the 16 bidding requirement. 17 COMMISSIONER WILLIAMS: Judge, I would offer that 18 motion that we refer the bid submitted by Lupe Rubio to 19 Mr. Keller Drozdick, the engineer for the project, with Tetra 20 Tech -- Mr. Drozdick's in the audience today -- for review 21 and recommendation. 22 COMMISSIONER LETZ: Second. 23 JUDGE TINLEY: Motion made and seconded as 24 indicated. Question or discussion on the motion? All those 25 in favor of the motion, signify by raising your right hand. 5-24-10 16 1 (The motion carried by unanimous vote.) 2 JUDGE TINLEY: All opposed, same sign. 3 (No response.) 4 JUDGE TINLEY: That motion does carry. 5 COMMISSIONER WILLIAMS: Keller, you can pick it up 6 from the clerk. If you want to go back, you can get it from 7 the clerk now. Thank you. 8 JUDGE TINLEY: Let's go to Item 8, if we might, to 9 consider, discuss, take appropriate action for the approval 10 to purchase an equipment haul truck with surplus sale funds. 11 Mr. Odom. 12 MR. ODOM: Good morning. 13 JUDGE TINLEY: Good to see you again. 14 MR. ODOM: What you have before you is a request 15 from us for the surplus funds that we've sold for the 16 equipment that we put with Gov.com, and what we wish to 17 replace is a 1979 Freightliner truck, our haul truck. And 18 you have the packet there that shows you the different 19 trailers that we use, but it particularly moves our equipment 20 around, our chip spreader, maintainers, things like that, 21 where they need to be, as well as hauling base material. 22 This truck was 17 years old when we bought it. We had it 14 23 years. We're pushing the envelope. We're getting to the 24 point where we -- it's hard to find parts. We had a -- we 25 ended up just the other day, just the lights -- the road 5-24-10 17 1 lights up above, we found two of those. They didn't think -- 2 Freightliner didn't even think they had them. So, we're at 3 that point that we would like, and we request from the Court 4 to use this excess funds that we have to go out and to look 5 for a new haul truck. And hopefully it will last us another 6 14, 15 years, just like we've had. It's been a good truck, 7 but parts are -- are really difficult to find now for this. 8 COMMISSIONER WILLIAMS: Have you selected a truck 9 for purchase, or are you just saying you want to do this? 10 MR. ODOM: I wish to purchase it. 11 COMMISSIONER WILLIAMS: You have selected one? 12 MR. ODOM: No, sir. No. I'm sorry, I didn't hear. 13 We haven't selected one. We're looking. We have been 14 looking, and we would come to the Court at that point to make 15 that recommendation. But what I'm asking for is your 16 permission to do that as a Court, and to use those funds, 17 which we feel should be sufficient to purchase one. 18 COMMISSIONER WILLIAMS: 72,514 is what you have 19 available? 20 MR. ODOM: Well, that is what we have. By the time 21 we pay the fee and everything -- that doesn't reflect that. 22 We're probably over $60,000. 23 COMMISSIONER BALDWIN: I move for approval. 24 COMMISSIONER OEHLER: Second. 25 JUDGE TINLEY: Motion made and seconded for 5-24-10 18 1 approval of the agenda item. Further question or discussion? 2 All in favor of the motion, signify by raising your right 3 hand. 4 (The motion carried by unanimous vote.) 5 JUDGE TINLEY: All opposed, same sign. 6 (No response.) 7 JUDGE TINLEY: That motion does carry. Thank you, 8 Mr. Odom. 9 MR. ODOM: Yes, sir. 10 JUDGE TINLEY: Let's move to Item 11; to consider, 11 discuss, take appropriate action concerning changes to the 12 jail commissary contract. 13 MS. WHITT: I'll call him. 14 JUDGE TINLEY: Did he duck out on us? 15 COMMISSIONER WILLIAMS: The missing Sheriff. 16 COMMISSIONER BALDWIN: This is a great moment. 17 COMMISSIONER OEHLER: There he is. You knew he 18 wouldn't be far. 19 JUDGE TINLEY: Yeah. 20 COMMISSIONER LETZ: We almost got by without a 21 meeting. 22 SHERIFF HIERHOLZER: Okay. All this is, is the 23 last year we contracted with Five Star Correctional to do 24 food service and commissary, two separate contracts. They 25 split their company, okay? Same people that are running 5-24-10 19 1 commissary run commissary, same guys. It's just that now 2 they're two totally separate companies. So, the original 3 company sent us a termination letter ending that contract 4 effective May 31st. The new company has sent one to continue 5 the contract, identical. Same money figures, same financial 6 stuff, same everything, same wording. Everything in the 7 contract's identical except for the term. The term of the 8 original one was five years; the term of this one is three 9 years, so it's just a shorter time period. Same person's 10 signature on it. Originally, Sheriff's Office didn't have to 11 contract the commissary except for once every five years, if 12 you ever do. And it's not like a bid-type deal where we're 13 spending money. We're making money off of it. It's just the 14 percentage of it. But I felt I needed to bring it, just 15 'cause of the wording change back to it. This one's normally 16 signed by me and the vendor, and not even the County Judge; 17 that's just the way they are. But I would like the authority 18 to go ahead and -- 19 COMMISSIONER OEHLER: Was there a cancellation 20 clause in that original contract with this one company? 21 SHERIFF HIERHOLZER: Yeah. And there's a 22 cancellation clause in this new one. 23 COMMISSIONER OEHLER: So, it's all according to 24 what it was supposed to be? 25 SHERIFF HIERHOLZER: Yes. 5-24-10 20 1 JUDGE TINLEY: Have you had the opportunity to let 2 the County Attorney briefly review the -- 3 SHERIFF HIERHOLZER: Him and I talked about it 4 several weeks ago. He has not had an opportunity, other than 5 this morning I gave him copies of all of them. He had a copy 6 of the old one, but the cancellation letter and the new one, 7 I gave him that this morning. 'Cause mainly I went through 8 it and looked at the two, and then in the original new one, 9 that -- that same -- same guy that does this, he still had 10 the "indemnify" clause in there. I said no, it had to be 11 identical to the same contract, and so he took all that out 12 so that they are identical. 13 JUDGE TINLEY: Other than going from five-year to 14 three-year, the terms are the same? The monetary and 15 compensation provisions and the other material provisions are 16 the same? 17 SHERIFF HIERHOLZER: Yes. 18 JUDGE TINLEY: Okay. Well, we just got a different 19 entity that's a spinoff of the prior entity. 20 SHERIFF HIERHOLZER: Right. 21 COMMISSIONER BALDWIN: So moved. 22 COMMISSIONER LETZ: Second. 23 JUDGE TINLEY: Motion made and seconded for 24 approval. Question or discussion? All in favor of the 25 motion, signify by raising your right hand. 5-24-10 21 1 (The motion carried by unanimous vote.) 2 JUDGE TINLEY: All opposed, same sign. 3 (No response.) 4 JUDGE TINLEY: The motion does carry. Let's go 5 to -- 6 COMMISSIONER BALDWIN: Luckenbach. 7 JUDGE TINLEY: -- Item 14, if we might, to 8 consider, discuss, take appropriate action to allocate 9 surplus 2010 capital funds unused by the Sheriff's Office to 10 purchase following vehicles: 2010 F-150 Ford truck for the 11 Environmental Health Department, to replace a 1999 Dodge 12 pickup with 108,000 miles with a Blue Book value of $625; 13 2010 F-150 Ford trucks, two of them, for Animal Control, to 14 replace a 1992 Ford F-250 with 170,351 miles, and a 2002 GMC 15 with 159,792 miles. Ms. Hargis? 16 MS. HARGIS: As you know, the Sheriff's Office gave 17 us back about 150,000 out of his budgeted line items in the 18 2010 capital outlay. It's come to my attention that we do 19 need these three vehicles. And as we discussed in our 20 budget, we were going to try to not do any capital items for 21 two years, but I don't think these vehicles are going to make 22 two years. I've asked -- these departments have justified to 23 me that they need these vehicles, and we do have some prebids 24 of about 18,000, almost 19,000 for the Ford -- the Ford 25 pickups. So, I'd just like permission for us to -- we're 5-24-10 22 1 getting close to the $50,000 bid process, so we may have to 2 bid them. But, you know, I'd like to have permission at 3 least to do that, and use the 2010 capital money to purchase 4 these vehicles. 5 JUDGE TINLEY: Are these going to be Buy Board 6 purchase -- purchases? 7 MS. HARGIS: We've been able to actually get a 8 better buy locally, as you may recall, from -- 9 JUDGE TINLEY: Maintenance, yeah. 10 MS. HARGIS: -- from the Ford dealership here in 11 town has given us the bid of eighteen thousand, eight. And 12 they're, what, twenty -- 13 MR. GARCIA: They're 29. 14 MS. HARGIS: At Buy Board. So, the price -- I 15 mean, it goes back to Ray's initial negotiations with them. 16 I think they're afraid of him, but they gave us the best 17 price in town. He wore his gun when he went in. (Laughter.) 18 So -- and we have bought several of these vehicles, and 19 they've been really good cars. So, I really don't have a 20 problem. I think we help the local economy. We may have to 21 bid them. I'm sure they'll come in with these bids, but 22 because we're -- with three of them, we're going to be close 23 to the 50,000 -- or probably over the 50,000, -- 24 JUDGE TINLEY: Mm-hmm. 25 MS. HARGIS: -- actually. 5-24-10 23 1 COMMISSIONER OEHLER: I'd say you need to bid them, 2 just to protect ourselves. 3 COMMISSIONER WILLIAMS: Yeah, I agree. 4 JUDGE TINLEY: Yeah. 5 COMMISSIONER WILLIAMS: Just do the bid. 6 MS. HARGIS: Okay. 7 COMMISSIONER WILLIAMS: No question about it then. 8 MS. HARGIS: But I do need permission to use these 9 -- and I use the word "surplus" because these are the funds 10 that we didn't use that we -- actually, we received the 11 grants after-the-fact, so I think this is a -- you know, 12 these are capital items, and a good use of our funds. It 13 will solve some of our maintenance problems and some of that 14 money going into the 2010 budget. 15 COMMISSIONER WILLIAMS: I move that we solicit bids 16 for replacement of vehicles as detailed in Item 1.14. 17 COMMISSIONER OEHLER: Second. 18 JUDGE TINLEY: Motion made and seconded as 19 indicated. Question or discussion on the motion? All in 20 favor of the motion, signify by raising your right hand. 21 (The motion carried by unanimous vote.) 22 JUDGE TINLEY: All opposed, same sign. 23 (No response.) 24 JUDGE TINLEY: That motion does carry. Thank you, 25 Ms. Hargis. Let's go to -- let's go to Item 17; consider, 5-24-10 24 1 discuss, take appropriate action on authorizing the County 2 surveyor to do preliminary site work for the new outdoor 3 arena at the Hill Country Youth Exhibit Center. That 4 presumes we're going to do that, so I guess if we do it, 5 why -- 6 COMMISSIONER LETZ: I think it can be contingent on 7 that. 8 JUDGE TINLEY: Yes. 9 COMMISSIONER LETZ: But the -- the reason for the 10 item is that when we were out there at the pre-bid 11 conference, and Len was there, and some of his -- Doug and a 12 few others, we looked at -- you know, Len's going to need 13 survey work done exactly where the arena's going to go and 14 what the grade needs to be exactly, so we can adjust things 15 that don't cause a problem somewhere else. 16 COMMISSIONER OEHLER: Yeah. 17 COMMISSIONER LETZ: And so we'll need a -- pretty 18 much a -- you know, a very detailed site survey at the 19 proposed location and a little bit beyond. And I just wanted 20 to get -- you know, so we had authority to go to the County 21 surveyor, Lee Voelkel, and, you know, get this done. 22 Certainly, we're not going to build it -- or if we don't 23 award the contract, they wouldn't do this, so it's contingent 24 on awarding the contract. 25 COMMISSIONER OEHLER: Is that a motion? 5-24-10 25 1 COMMISSIONER LETZ: That was a motion. 2 COMMISSIONER OEHLER: Okay. Second. 3 JUDGE TINLEY: We have a motion and a second to 4 authorize the agenda item, contingent upon the going forward 5 and awarding the bid on the outdoor arena. Further question 6 or discussion on the motion? All in favor of the motion, 7 signify by raising your right hand. 8 (The motion carried by unanimous vote.) 9 JUDGE TINLEY: All opposed, same sign. 10 (No response.) 11 JUDGE TINLEY: The motion does carry. Let's go 12 back to Item 4, a 9:30 timed item. At this time, I will 13 recess the Commissioners Court meeting, and I will open a 14 public hearing on the proposed speed limit and speed limit 15 signs on Backacre Road located in Precinct 1. 16 (The regular Commissioners Court meeting was closed at 9:30 a.m., and a public hearing was held in open 17 court, as follows:) 18 P U B L I C H E A R I N G 19 JUDGE TINLEY: Is there any member of the public 20 that wishes to be heard with respect to the proposed speed 21 limit and speed limit signs on Backacre Road located in 22 Precinct 1? Seeing no one seeking recognition to be heard or 23 otherwise coming forward, I will close the public hearing on 24 the proposed speed limit and speed limit signs on Backacre 25 Road located in Precinct 1. 5-24-10 26 1 (The public hearing was concluded at 9:30 a.m., and the regular Commissioners Court meeting was 2 reopened.) 3 - - - - - - - - - - 4 JUDGE TINLEY: I will now call Item Number 5; to 5 consider, discuss, take appropriate action to approve the 6 recommended speed limit for Backacre Road and approve speed 7 limit signs to be installed, again, located in Precinct 1. 8 Mr. Odom. 9 MR. ODOM: Yes, sir. Backacre's off Coker Road. 10 And this is one road that's never been posted. We had a 11 request by a family that lived there; also, their neighbors. 12 They had had a -- like a homeowners' association meeting and 13 requested that. We placed out three different locations over 14 a three-day period. According to the traffic counters, 85 15 percentile shows that the speed should be set at 40 miles an 16 hour. But when we drove Backacre, 40 miles an hour was just 17 too fast. Too many curves, too close together; was 18 unacceptable. So, our recommendation is that the speed on 19 Backacre be set at 35 miles an hour, and at this time, we ask 20 the Court for their approval on setting the speed limit at 21 35, and also setting six speed limit signs, three in either 22 direction on Backacre in Precinct 1. 23 COMMISSIONER BALDWIN: What an honor it is to be 24 able to say that I want to approve this agenda item. 25 COMMISSIONER OEHLER: Second. 5-24-10 27 1 JUDGE TINLEY: Motion made and seconded to approve 2 the agenda item -- a 35 mile-an-hour speed limit? Is that 3 correct, Mr. Odom? 4 MR. ODOM: That's correct, sir. 5 COMMISSIONER BALDWIN: Yes, sir. 6 JUDGE TINLEY: And the posting of the signs as 7 indicated. Further question or discussion on the motion? 8 COMMISSIONER BALDWIN: Len? 9 MR. ODOM: Yes, sir? 10 COMMISSIONER BALDWIN: How long is the road? 11 MR. ODOM: I believe a mile and a half, 2 miles, 12 off the top of my head. 13 COMMISSIONER BALDWIN: Mile and a half? 14 MS. HOFFER: Just a mile and a half. 15 COMMISSIONER BALDWIN: Thank you. 16 MR. ODOM: That's my guess. 17 COMMISSIONER BALDWIN: Yeah, you're about right. 18 Thank you. 19 JUDGE TINLEY: Any other question or discussion on 20 the motion? All in favor of the motion, signify by raising 21 your right hand. 22 (The motion carried by unanimous vote.) 23 JUDGE TINLEY: All opposed, same sign. 24 (No response.) 25 JUDGE TINLEY: That motion does carry. Okay. Now 5-24-10 28 1 let's go to Item 16; consider, discuss, take appropriate 2 action on resolution to L.C.R.A. regarding the C.R.E.Z. -- 3 CREZ power lines in Kerr County. Commissioner Letz? 4 COMMISSIONER LETZ: I put this on the agenda. I 5 think it's pretty obvious what the purpose of it is. It's a 6 resolution outlining our position related to these L.C.R.A. 7 CREZ power lines that are potentially -- almost certainly 8 will affect some of Kerr County. And I looked at the 9 previous resolution we've done, and this one's a little bit 10 different in that it's more forceful, I would say -- that was 11 the intent, anyway, to try to really give the L.C.R.A. and 12 P.U.C. direction from this Court as to what we feel the 13 residents of Kerr County want. And I know it's a little bit 14 hard to say that, and I did this partially -- one, I think we 15 need to do it, but the other reason is I think the P.U.C., 16 when they rejected some L.C.R.A. power lines a month or so 17 ago, their -- some of the correspondence I've seen out of 18 that basically said they expect the Commissioners Court to be 19 a little -- and other governmental entities to take a little 20 bit tougher stand, or more direct stand -- not necessarily 21 tougher, but more direct stand to help guide them. And I 22 know the City of Kerrville -- I've talked with some of the 23 folks over there, and they've got, I believe, an agenda item 24 tomorrow night on a similar one. I visited with them at one 25 -- at the council meeting a month or so ago about this 5-24-10 29 1 overall topic, and I think they intend to probably send 2 someone to P.U.C. to testify, which may not be a bad idea for 3 us to do the same. So, I drafted a new resolution over the 4 weekend, sent it out. Did anyone -- it's not on my computer. 5 Jody, I got -- 6 COMMISSIONER WILLIAMS: Did you send an e-mail or 7 what? 8 MS. GRINSTEAD: It should be 16a. 9 COMMISSIONER LETZ: It should be -- I don't have 10 it. 11 MS. GRINSTEAD: No? 12 COMMISSIONER BALDWIN: There's no 16a. 13 COMMISSIONER LETZ: Here, if we can get a couple 14 copies? And I don't know that the timing of it is such that 15 we have to do it today. Doesn't hurt. But I really wanted 16 this, you know, out before the Court, before the public, and 17 maybe, you know, it makes sense to go ahead and do it the 18 first meeting in June. I do think it is important to get it 19 done at either this meeting or next meeting. 20 COMMISSIONER WILLIAMS: Didn't I see an e-mail or 21 something about a proposed meeting with L.C.R.A. people here 22 in the courthouse coming up very soon? 23 COMMISSIONER LETZ: I think it's tomorrow 24 afternoon. 25 JUDGE TINLEY: Tomorrow afternoon. 5-24-10 30 1 COMMISSIONER WILLIAMS: Tomorrow afternoon? 2 JUDGE TINLEY: I wasn't sure whether it had been 3 confirmed or not, but I talked to Ms. Hoffman, who's the 4 local customer service rep, and we had talked about they were 5 going to be in town tomorrow. They were going to be present 6 for the council meeting tomorrow night, and she said possibly 7 they could be here tomorrow afternoon. So I asked them, if 8 possible, if they could be available sometime in the 9 afternoon, mid-afternoon-ish, and what we kind of settled on 10 was -- I guess last Friday, was that 2 o'clock -- 3 o'clock, 11 rather. I've not seen the response, so -- she didn't 12 indicate that there was going to be a problem with it, so I 13 assume it's on. I don't know. 14 COMMISSIONER BALDWIN: So, they're going to be in 15 the courthouse for what purpose? 16 JUDGE TINLEY: I think to tell us where they are in 17 terms of their -- 18 COMMISSIONER BALDWIN: To meet with the 19 Commissioners Court? 20 JUDGE TINLEY: Well, obviously, we -- we couldn't 21 have posted that -- 22 COMMISSIONER BALDWIN: Or the public? 23 JUDGE TINLEY: -- at that time, because it was late 24 Friday afternoon that I talked to Ms. Hoffman. And 25 certainly, you know, a couple of us could be present. It was 5-24-10 31 1 my intention to be present. 2 COMMISSIONER BALDWIN: I see. 3 JUDGE TINLEY: And I asked that she did notify all 4 of the members of the Court by e-mail to confirm it, and I 5 assume she did that. I don't know how -- like I say, I've 6 not seen it. But -- 7 COMMISSIONER LETZ: I saw an e-mail that stated 8 that -- probably the one she sent to all of us, but from 9 Ms. Hoffman, that she -- or they would be -- L.C.R.A. and 10 herself would be at Gillespie County Commissioners Court this 11 morning and would not be here today, and -- but that she was 12 aware that this was on our agenda. Judge, you know, I think 13 it's too important to rush through. Can we at least wait 14 till after the break, and then let the Court decide if we 15 want to act on it today? Or -- you know, 'cause I think it's 16 important we get the wording correct. And our local 17 wordsmith hasn't had a chance to look at it yet, Commissioner 18 Williams. 19 COMMISSIONER BALDWIN: Commissioner, you could just 20 put -- far as I'm concerned, you could -- in the "Therefore" 21 part, put Number 1 there and just skip all the other fancy 22 stuff. 23 COMMISSIONER LETZ: Well, I tend to agree. 24 COMMISSIONER BALDWIN: Put the lines outside of 25 Kerr County. That's it. 5-24-10 32 1 COMMISSIONER LETZ: One and two are the most 2 important, in my mind. And for the public, number two reads, 3 "L.C.R.A. should respect private property rights and only 4 locate translation lines on property where property owners 5 voluntarily enter into agreements with L.C.R.A., and 6 condemnation or threat of condemnation should not be used by 7 L.C.R.A." And many of my constituents are the ones I talked 8 to, and L.C.R.A. is not doing that right now. They are still 9 threatening condemnation on property, and they are still not 10 offering anywhere near the amount that Florida Power and 11 Light came through and offered to the public. Florida Power 12 and Light was able to do this voluntarily, and I think 13 L.C.R.A. should do the same. The fact that they have that 14 ability was mentioned to me as irrelevant. 15 COMMISSIONER OEHLER: I think that, you know, if 16 you really look at it, Florida Power and Light set some kind 17 of precedent on what right-of-way's worth. 18 COMMISSIONER WILLIAMS: Absolutely, they did. 19 JUDGE TINLEY: I've had the same discussion with 20 Ms. Hoffman, and told her that if they -- if they were to pay 21 market price, they would -- they would find where their line 22 could be located, and that if they end up in the courthouse 23 on any of these, the comparable sales that they're going to 24 be faced with are the Florida Power and Light comps, because 25 they're -- they are the comp sales, for the same purpose, 5-24-10 33 1 basically the same type of use. And the response I got was, 2 "Well, we really can't afford to pay that." 3 COMMISSIONER OEHLER: Maybe they can't afford to 4 have a line. 5 JUDGE TINLEY: And -- but if that -- 6 COMMISSIONER WILLIAMS: It's that simple, isn't it? 7 JUDGE TINLEY: That's a direct recognition that 8 they do -- they're not offering market value. 9 COMMISSIONER OEHLER: Yeah. 10 JUDGE TINLEY: And, you know, this is going to have 11 to be passed on to the rate payers. And to have a different 12 standard applied to them merely because they have this -- 13 this legal status and have the power of eminent domain, it 14 doesn't make the burden of proof any different in a 15 condemnation case; you're looking at market value. I -- 16 maybe they -- maybe they want to change the definition, 17 instead of being a -- a willing seller under no compulsion to 18 sell, they say, "Well, we got condemnation, so he's a willing 19 seller, but he's under a compulsion to sell." I don't think 20 the appellate courts, in 50-plus years, have -- of the legal 21 standard for market value, they haven't applied that in 22 condemnation cases, to my knowledge, yet, so I don't see that 23 changing. I just see it as strong-arming, and that's very 24 unfortunate. 25 COMMISSIONER LETZ: Yeah. 5-24-10 34 1 JUDGE TINLEY: But as Commissioner Letz said, the 2 P.U.C., I think, wants more direct involvement by local 3 government entities, and they want to know what our thinking 4 is speaking on behalf of our constituents, because they -- 5 they obviously think it's important, and they want the 6 benefit of it. And -- 7 COMMISSIONER OEHLER: Well, the private line 8 Florida Power and Light put in, they put up poles, and 9 L.C.R.A. is proposing lattice towers. They did everything 10 that the property owners really wanted, plus they paid the 11 money that -- basically, one neighbor would say, "Well, my 12 neighbor doesn't want it. Put it over on my place." You 13 know, that -- and all that got done while L.C.R.A. has 14 been -- 15 JUDGE TINLEY: No, that line's in. 16 COMMISSIONER OEHLER: It's in. It's done. 17 COMMISSIONER WILLIAMS: Couple questions, 18 Commissioner. And I'm looking at Number 4 and Number 6, and 19 if I'm not mistaken, the City is -- is in opposition to 20 what's taking place because they don't want those lines 21 coming down I-10 through very developable property in the 22 future. 23 COMMISSIONER LETZ: Right. 24 COMMISSIONER WILLIAMS: And then on 6, we talk 25 about using other right-of-ways, including highways. I'm 5-24-10 35 1 wondering if we have some conflict there that we ought to try 2 to resolve in the language. And the other question that I 3 have, just in glancing at it so far, is under Number 2. When 4 we talk about fair market prices, which -- which becomes the 5 benchmark for anything that they try to do with respect to 6 private property, we talk about private property owners or 7 property owner voluntarily entering into agreements. And I'm 8 wondering at this point whether we should make some reference 9 to "at fair market prices," just to get that in the record 10 too. 11 COMMISSIONER LETZ: Okay. 12 COMMISSIONER WILLIAMS: You and I can sit down and 13 talk about this later, if you wish. 14 COMMISSIONER LETZ: Okay. Let me just -- and I 15 think we can do that. You know, we can I think pass on this 16 until the next meeting, but let me, before we leave it, read 17 these in, just so the public is wear of what the "Resolved" 18 portions say. Number 1 is, "Locate the transmission lines, 19 to the maximum extent possible, outside Kerr County." Two 20 is, "L.C.R.A. should respect private property rights and only 21 locate transmission lines on property where property owners 22 voluntarily enter into agreements with L.C.R.A., and 23 condemnation or threat of condemnation should not be used by 24 L.C.R.A." Three, "L.C.R.A. should consider property 25 fragmentation and natural resources." Four, "Transmission 5-24-10 36 1 lines should not be located on property adjacent to the city 2 of Kerrville, through existing subdivisions and other areas 3 of concentrated population." Five, "Single pole structures 4 should be used, and not lattice structure poles." Six, 5 "Existing transmission and other right-of-ways, including 6 highways, should be used, or property adjacent to existing 7 right-of-ways." Seven, "Consolidation of transmission line 8 right-of-ways should be of high priority, and should be 9 utilized to minimize additional property fragmentation, even 10 when such consolidation increases the cost of the project." 11 And 8, "The location of transmission lines should consider 12 the impact on property values, the aesthetics and beauty of 13 hill country vistas, and protect the hill country natural 14 resources." 15 And there is a little bit of redundancy there; we 16 probably could get rid of one of those, and -- but, anyway, 17 on the highway issue, I took out -- and we've discussed some, 18 I think, the I-10 corridor, and I took that out. To me, a 19 highway right-of-way is better than a non-highway 20 right-of-way, within the -- you know, in other words, better 21 than it going across and tearing up some other country if you 22 can't get voluntary compliance, but at the same time, I agree 23 that you need to look at property values and developable 24 land. So, you know, I think there's a little bit of a 25 conflict there. But there are places, once -- when you get 5-24-10 37 1 close to Comfort, especially -- maybe to be more specific, 2 another line coming in diagonally from the northwest, when 3 you have -- I think it ought to get to I-10 as quickly as 4 possible when it gets near Comfort, and so it comes down 5 right there where there's all kinds, rather than another line 6 coming down, making it worse than it already is right where 7 the substation is at Block Creek, where these power lines are 8 going. So, that's where I'm -- you know, and maybe we should 9 just be more specific about that. The other thing that, you 10 know, I know there is a -- there's a line -- existing 11 right-of-way line that goes from Block Creek power station to 12 Comfort up to Fredericksburg, and that right-of-way should be 13 used as much as possible, both ways. They could -- or, 14 actually, as I understand it from talking with Ms. Hoffman, 15 they're actually talking to -- Palafox? Is that his name? 16 JUDGE TINLEY: Mm-hmm. 17 COMMISSIONER LETZ: Palafox. That, you know, it is 18 possible, though it's much, much more expensive for them to 19 use that right-of-way coming and going. They can bring the 20 tower down to Comfort, take it back out. I don't understand 21 why that makes -- you know, how all that works, but it works 22 from an engineering standpoint. And I think it's a -- to me, 23 a very viable option, to the benefit of Kerr County, 24 certainly. 'Cause that -- 25 COMMISSIONER WILLIAMS: Didn't Gillespie County 5-24-10 38 1 take a position on it? 2 COMMISSIONER LETZ: Yes, they did. Theirs 3 basically said, "Stay out of our county." But if you -- 4 (Laughter.) 5 COMMISSIONER WILLIAMS: That's a position. 6 COMMISSIONER LETZ: But they also -- 7 COMMISSIONER BALDWIN: That's a good position. 8 COMMISSIONER OEHLER: Short resolution. 9 COMMISSIONER LETZ: But then they -- and then the 10 other part of it was, if my recollection is correct, that if 11 you're not going to stay out of our county, use single poles. 12 It was pretty short. It was not a real long resolution. And 13 I think that the -- I think we should have, you know, a lot 14 more meat to it than that. I think we should really try to 15 guide them, and I think the property rights issue is the most 16 important thing, in my mind, on here, and that they use true 17 market value, because if they pay market value, they will get 18 the right-of-way. And it may -- the line may zigzag some and 19 it may cost more, but so be it. 20 COMMISSIONER BALDWIN: When you talk about they 21 should not be on property that is next to the city of 22 Kerrville, are you talking about the city limits? Are you 23 talking about ETJ? Or -- 24 COMMISSIONER LETZ: I just said adjacent. Now, I 25 think the -- the intent, I think, is clear, that in my mind, 5-24-10 39 1 that, you know, if the power lines are coming in on the north 2 side of Kerrville, where they appear to on all the plans that 3 I've seen, they need to move them away from the -- the 4 subdivisions that are right there. That means, in my mind, 5 moving it basically north of the -- of Tierra Linda, up in 6 that area. You want to get it north of Whiskey Canyon, north 7 of all that developable land. I mean, so I think there's 8 a -- we are -- or the city of Kerrville is ringed by 9 subdivisions on the north in the ETJ and up to the city 10 limits, and I think going -- any power lines crossing any of 11 those areas is a detriment to all of Kerr County. 12 COMMISSIONER WILLIAMS: When you move it north, as 13 you say, then, in effect, you're talking about the Florida 14 Power and Light -- 15 COMMISSIONER BALDWIN: Yes. 16 COMMISSIONER WILLIAMS: -- easements which come 17 through at about that point. 18 COMMISSIONER LETZ: Yes. 19 COMMISSIONER BALDWIN: And a lot of that's outside 20 of Kerr County. 21 COMMISSIONER LETZ: Yes. 22 COMMISSIONER WILLIAMS: Which is a good thing. 23 COMMISSIONER BALDWIN: Move them over in Gillespie 24 County. 25 COMMISSIONER OEHLER: Just can't do it here. Just 5-24-10 40 1 got to keep moving further north. 2 COMMISSIONER LETZ: I'm not sure the geography is 3 what counts. 4 JUDGE TINLEY: The other issue -- 5 COMMISSIONER WILLIAMS: There's another issue. 6 There's -- there's going to be a major line coming from the 7 Austin area that will tie in, and one of the -- probably the 8 northern-most route that picks up in Mason and picks up on an 9 existing right-of-way adjacent to Highway 87, coming all the 10 way into Fredericksburg, it follows an existing power line 11 right-of-way. But staying up in that -- up towards the 12 northeast makes it easier and less expensive, and requires 13 less line to come off of that line and go on to Austin. So, 14 that's another major consideration. You know, possibly add 15 something, having the two do tie-ins. Just another thought. 16 COMMISSIONER LETZ: It's -- to me, it's a little 17 bit of a fine line. We certainly -- I mean, I don't want to 18 -- I want it to stay out of Kerr County, but I'm not going to 19 tell them what county to put it in. And the one thing that I 20 did leave off, and I left it off intentionally -- I want to 21 bring it up; maybe we should include it -- is endangered 22 species. Kerr County has a lot. And I'm a lot more aware of 23 that in working with it because of the -- whatever that thing 24 is I'm working on out of San Antonio -- Habitat Conservation 25 Plan. That is an issue. And the feds have a pretty big 5-24-10 41 1 stick when it comes to that. And, you know, that may be 2 something -- you know, but at the same time, you know, I'm -- 3 I think it's pretty clear that, you know, we have a lot of 4 these endangered species in Kerr County, a lot of habitat. 5 And I think that it -- you know, because of that, it is a 6 reason to put it elsewhere. But I don't know if we want to 7 put that in the resolution or not. That's kind of -- I just 8 bring it up for -- 9 JUDGE TINLEY: I'm given to understand that the 10 P.L.C.A. folks have acquired additional properties down in 11 Real County to offer up in exchange for the endangered 12 species issue, so that may not have as much teeth in it as we 13 might have otherwise thought. 14 COMMISSIONER LETZ: Well, it may not. But the -- 15 because I have become very intimately involved with how this 16 Section 10 -- which that is Section 10 takings -- works. 17 It's got to be -- frequently, the proximity to the incidence 18 of taking is critical to whether it's accepted or not, and 19 Real County is not real close to -- 20 JUDGE TINLEY: No. 21 COMMISSIONER LETZ: -- north of Kerrville. So, 22 they might have acquired the property there, but whether, 23 from a species standpoint, that's viable as a viable 24 alternative to the incidental taking is a different argument. 25 I've been educated on that point. 5-24-10 42 1 COMMISSIONER OEHLER: Going to trap all the 2 endangered species and put them over there? 3 COMMISSIONER LETZ: Put them all there. I'm sure 4 they're happy about that in Real County. Anyway, so bring it 5 back in two or three weeks? Does that make sense? Or do you 6 want to do it today? 7 JUDGE TINLEY: My understanding is that they are 8 going to roll out their actual preferred route and 9 alternative routes to the P.U.C. in a finding in early July, 10 I believe. July the 9th? 11 COMMISSIONER LETZ: Right. 12 JUDGE TINLEY: Does that number sound correct? 13 COMMISSIONER LETZ: Yes. I know it's the first 14 couple weeks in July. So -- 15 JUDGE TINLEY: So, I would think early June would 16 give us an opportunity. 17 COMMISSIONER LETZ: We'll work a little bit. I 18 just wanted to get it before the Court. 19 JUDGE TINLEY: Okay. We've got a 9:45 timed item, 20 so let's go to that item now. At this time, I will recess 21 the Commissioners Court meeting, and I will open a public 22 hearing on a proposed speed limit and speed limit signs on 23 Lower Reservation Road located in Precinct 4. 24 (The regular Commissioners Court meeting was closed at 9:54 a.m., and a public hearing was held in open 25 court, as follows:) 5-24-10 43 1 P U B L I C H E A R I N G 2 JUDGE TINLEY: Is there any member of the public or 3 audience that wishes to be heard with respect to the proposed 4 speed limit and location of speed limit signs on Lower 5 Reservation Road located in Precinct 4? Seeing no one 6 seeking recognition or otherwise coming forward to be heard 7 on the matter, I will close the public hearing on the 8 proposed speed limit speed limit signs on Lower Reservation 9 Road, located in Precinct 4, and I will reconvene the 10 Commissioners Court meeting. 11 (The public hearing was concluded at 9:54 a.m., and the regular Commissioners Court meeting was 12 reopened.) 13 - - - - - - - - - - 14 JUDGE TINLEY: We'll go now to Item 7, to consider, 15 discuss, and take appropriate action to approve the 16 recommended speed limit for Lower Reservation Road and 17 approve speed limit signs to be installed. Mr. Odom? 18 MR. ODOM: Yes, sir. Thank you. Lower Reservation 19 is off 479 in Precinct 4, and there has never been -- like 20 the previous road, has never been a posted speed limit on it. 21 And Ms. Bryant -- I believe Ms. Bryant was sitting beside 22 me -- requested on March the 26th that we do a traffic count 23 to set a speed limit. We did that at three different 24 locations. We ended up with a speed limit of 47 in Box 1. 25 Box 2 was 53, and Box 6 was 62 miles an hour. So, according 5-24-10 44 1 to this data, the average speed would be 54, which would 2 indicate a speed of 55 miles an hour by the 85 percentile. 3 We feel that -- we drove that, and certainly 55 is not 4 acceptable. We looked at -- I looked at 40; Ms. Bryant asked 5 me about that earlier, and I looked at 45. Forty-five is 10 6 miles up underneath that, and is reasonable in most cases. 7 When you start to set something lower, we already know that 8 the average is 55; they're not going to drive that. 9 What we will have to do eventually -- Ms. Bryant 10 asked me -- is that as we go through, we will probably remove 11 those cattle guards. All that area is fenced, but that is -- 12 as we work over the next two years up there, we will address 13 that concern up there. But the traffic count is not that 14 much up in there. Very little traffic. Those cattle guards 15 restrict that area. And the area has come apart due to the 16 rains and to the freeze/thaw, so we'll be working on that 17 area over the next two years. Other than that, what I'm 18 asking the Court to do is to approve setting the speed limit 19 at 45 miles an hour and install eight speed limit signs, four 20 in either direction, for Reservation Road in Precinct 4. 21 COMMISSIONER OEHLER: Move approval. 22 COMMISSIONER LETZ: Second. 23 COMMISSIONER BALDWIN: Second. 24 JUDGE TINLEY: Motion made and seconded for 25 approval of the agenda item as indicated. Further question 5-24-10 45 1 or discussion on the motion? All in favor of the motion, 2 signify by raising your right hand. 3 (The motion carried by unanimous vote.) 4 JUDGE TINLEY: All opposed, same sign. 5 (No response.) 6 JUDGE TINLEY: That motion does carry. 7 COMMISSIONER LETZ: Judge, I think we probably 8 could handle 20 and 21 outside of executive session. I think 9 we can probably go pretty quick. If we need to, we can 10 always come back, or we can go to -- 18 and 19 shouldn't take 11 long either. 12 JUDGE TINLEY: Yes, sir, that's where I'm going 13 now. Let's go to Item 18; consider, discuss, and take 14 appropriate action on calling for a road district in a 15 portion of Lazy Valley Subdivision and setting a public 16 hearing for same. 17 COMMISSIONER LETZ: This is on the agenda based on 18 a phone call I received from Nadene Friday -- or Thursday. I 19 guess it was Thursday. I think the Court's aware that 20 there's -- some of my constituents in Lazy Valley Subdivision 21 would like a road district formed, and there's a -- the 22 timing of it, this is on the agenda kind of as a holder -- 23 space holder, as is the next one. There's a lot -- it's a 24 public hearing; there's a lot of paperwork and process that 25 has to go forward or be done to get it on the November 5-24-10 46 1 ballot, and this is on there because Nadene was concerned 2 that we might be running out of time a little bit. We do not 3 -- I have a petition, probably not in the proper form, from 4 Lazy Valley, and I have a lot of phone calls out of the next 5 agenda item. But I'll turn it over to Nadene to look at the 6 road district and see if it has to be handled at this 7 meeting, or if we can put -- these two be can be pushed off 8 to the next meeting. 9 MS. ALFORD: In the Transportation Code, in 10 257.021, the establishment of a road district, the 11 commissioners court of the county, by order, may establish 12 one or more road districts in the county. But then, once you 13 -- you can establish it. Then you need to have a public 14 hearing on it, and notice has to be done to those people and 15 in the paper. 16 COMMISSIONER LETZ: Timing, basically. 17 COMMISSIONER WILLIAMS: And ultimately a vote, 18 right? 19 MS. ALFORD: Yeah. 20 COMMISSIONER LETZ: We can establish it without a 21 petition, correct? 22 MS. ALFORD: Correct. 23 COMMISSIONER LETZ: And then as soon as we 24 establish it, then we hold a public hearing? 25 MS. ALFORD: Mm-hmm. 5-24-10 47 1 COMMISSIONER LETZ: The -- timing wise, can we push 2 this off until the June 14th meeting? 3 MS. ALFORD: We can. 4 COMMISSIONER LETZ: Okay. My recommendation to the 5 Court would be for us to do that, and the reason is I want to 6 talk to the residents of both these areas and make sure that 7 the boundaries that they want us to have -- 'cause I think 8 we're going to have to have the boundaries set prior to 9 forming it. That'd be a good idea, in my mind. Okay. Thank 10 you, Nadene. 11 MS. ALFORD: Uh-huh. 12 JUDGE TINLEY: What's the notice -- what's the 13 notice requirement for the public hearing? 14 MS. ALFORD: It's like the notice of election, to 15 be done 30 days before we hold the hearing. 16 JUDGE TINLEY: Thirty days notice, as opposed to 17 15? 18 MS. ALFORD: Yes, sir. 19 JUDGE TINLEY: Okay. 20 COMMISSIONER LETZ: Yeah. The timing issue that 21 becomes real critical is, even though this is just a local 22 election, it has to go through the Justice Department for 23 preclearance, and that really backs up your -- you know, 24 getting a lot of the legwork done. One of the districts, 25 Lazy Valley, they're pretty much -- they've done a lot of 5-24-10 48 1 their research and all that's done, but the other -- the one 2 in Castle Lake, you know, they need to get a little bit -- 3 they need to get on the stick, get a little bit done prior to 4 next court meeting. Anyway, I think we can pass it. 5 COMMISSIONER WILLIAMS: Nadene? 6 MS. ALFORD: Sir? 7 COMMISSIONER WILLIAMS: What is the calendar 8 deadline for initiatives of any description for the November 9 ballot? 10 MS. ALFORD: August 24th is the last day to call 11 the November election. 12 COMMISSIONER WILLIAMS: Okay. For any purpose? 13 MS. ALFORD: For any purpose, yes. August the 14 24th. 15 COMMISSIONER WILLIAMS: Thank you. 16 MS. ALFORD: Mm-hmm. 17 JUDGE TINLEY: That's not too far away, gentlemen. 18 Okay. Let me go ahead and call Item 19; consider, discuss, 19 take appropriate action on calling for a road district in a 20 portion of Castle Lake Subdivision and setting a public 21 hearing for the same. 22 COMMISSIONER LETZ: Judge, I guess we'll pass on it 23 and have it on the next agenda. 24 JUDGE TINLEY: Okay. We've got a 10 o'clock timed 25 item; let's consider that. We got several of them. Let's 5-24-10 49 1 take the first one, if we might. Item 9, take appropriate 2 action to award contract for demolition and construction of 3 outdoor arena at Hill Country Youth Exhibit Center. We went 4 out for bids on that, and Mr. Lewis is here with us today. 5 MR. LEWIS: Good morning again, Judge and 6 Commissioners. I do -- on the rodeo arena, May 10th we 7 received bids from four different contractors: Feller 8 Fabrication; Socen, Inc., doing business as Southwest 9 Fabricators; Kendnel Kasper Construction, Inc.; and Heritage 10 Construction. Reviewed those. As y'all recall, the scope of 11 work was the demolition of the existing -- or sequentially, 12 construction of an arena and an announcer's stand, and then 13 demolition of the existing arena. And so we structured the 14 bids at the Court's pleasure to have either the demolition 15 stand-alone, the new construction stand-alone, and we also 16 asked them for their best value if they combined both. As 17 the bids -- as we received the bids, it was very apparent 18 that there was a low bidder on the demolition and a low 19 bidder on the new construction. They weren't the same 20 contractor. So, we qualified those. I spoke in earnest with 21 them and made sure that each of those contractors was 22 comfortable; they stood behind their numbers and they were 23 confident they had the scope of work complete on both that -- 24 both new construction and demolition. And so I'm here this 25 morning to recommend that the County consider, and recommend 5-24-10 50 1 for approval Kendnel Kasper Construction out of 2 Fredericksburg to be responsible for the demolition, and 3 their hard bid for that was $7,885, and that Socen, Inc. out 4 of Junction, also doing business as Southwest Fabricators, be 5 awarded -- be considered for award on new construction of the 6 arena and the press box for $115,950. 7 COMMISSIONER WILLIAMS: What was the first number, 8 Peter? 9 MR. LEWIS: $7,885. And y'all -- we did have bid 10 summaries, bid tabulations that may be in your package there 11 that shows how we arrived at that construction/demolition 12 time. Kendnel Kasper proposes to tear that arena down, 13 remove it, and we're cutting it down to grade, capping -- the 14 County's going to handle any utilities before they begin 15 their demolition, and then Kendnel Kasper will do that work 16 in 15 days, and then Socen, Inc., will construct the new 17 arena and the announcer's stand in 60 days. 18 JUDGE TINLEY: The sequence of the projection is 19 new construction first, then the demolition? 20 MR. LEWIS: Yes, sir. 21 COMMISSIONER LETZ: When we were at the pre-bid 22 conference, we were going through some of the details on the 23 demolition, and after looking at it, a few things were taken 24 out of the demolition; namely, the lights. Those lights are 25 pretty good lights, some of them. Some of them are pretty 5-24-10 51 1 old, some of them are petty good. I thought that's something 2 that, you know, we didn't want to -- 'cause I thought we 3 should keep them; I thought that made sense. And we're going 4 to -- you know, they can be used somewhere, certainly. So 5 those were taken out at the last minute, and also some of the 6 electrical disconnect stuff, we're going to take care of 7 that. That was not part of it. I thought it would be -- I 8 just didn't want -- depending on where the low bidder was, I 9 didn't want to have some electric stuff out there. 10 MR. LEWIS: I had a request from Roy Walston to 11 that effect, and, you know, confirmed that that was the route 12 that we were going to take and that the County -- County was 13 going to handle all utilities, and you would salvage for 14 yourself anything worth saving, like fixtures, light poles. 15 COMMISSIONER OEHLER: We were just told those 16 lights some on of them are not very old. 17 MR. LEWIS: Some of them look very new. Some are 18 kind of old, but only a handful of them. 19 COMMISSIONER LETZ: Those -- the dollars look 20 reasonable to me. Bruce probably knows more about that. 21 COMMISSIONER OEHLER: Yeah, I agree. I sure 22 believe the demolition is reasonable. 23 MR. LEWIS: Yeah. 24 COMMISSIONER OEHLER: Of course, there's a lot of 25 salvage there. The price of steel right now is up. But 5-24-10 52 1 still -- go ahead. 2 JUDGE TINLEY: What was our -- what was our budget 3 guesstimate? 4 MR. LEWIS: We did not have one. 5 COMMISSIONER LETZ: I think we put originally, 6 like, 150,000, I want to -- 7 COMMISSIONER WILLIAMS: That was an estimate we -- 8 COMMISSIONER LETZ: That was an estimate to do the 9 whole project. You know, and so we're -- 10 JUDGE TINLEY: In our capital package, we 11 allocated -- I don't have that in front of me, so I was just 12 curious as to what it was. 13 COMMISSIONER LETZ: Seems like it was that. 14 JUDGE TINLEY: We're certainly within that, though. 15 COMMISSIONER LETZ: Yeah. 16 JUDGE TINLEY: Okay. 17 COMMISSIONER LETZ: I guess the only issue is, I 18 presume we're -- I mean, my feeling is we should go forward 19 with the project, you know, and I'll make a motion to award 20 the contract as recommended by Peter Lewis. 21 COMMISSIONER OEHLER: Second. 22 JUDGE TINLEY: Motion made and seconded to award 23 bids as recommended by Mr. Lewis, to Kendnel Kasper for the 24 demolition, $7,885, and Socen, Inc., for the new 25 construction, $115,950. And that includes the -- the 5-24-10 53 1 adjustment made on what was pulled from the demolition also. 2 Okay. 3 COMMISSIONER LETZ: A comment. Peter, who are the 4 -- some of the principals in Socen? Because I think there 5 are some local ones. 6 MR. LEWIS: I thought you might ask. I don't have 7 the gentleman's name that we visited with at the site here in 8 front of me. I do have -- Shannon Boyles is the owner, and I 9 spoke with him regarding that, but there were some other -- 10 the brothers, and I apologize, I -- 11 COMMISSIONER LETZ: I believe that David Johnson is 12 part of this. 13 COMMISSIONER OEHLER: Is David Johnson part of that 14 group? 15 MR. LEWIS: And when we met at the prebid, they had 16 some thoughts about how to improve the optimum layout. And 17 so what we suggested -- what Commissioner Letz suggested is 18 that they bid as drawn, and that we would select a contractor 19 and work through those details. 20 COMMISSIONER LETZ: I said we would -- you know, if 21 they had better ideas about things, they were listed, but bid 22 it as drawn. 23 MR. LEWIS: And I also note there is an agenda item 24 here today that the County -- to authorize the County to do 25 the survey work. There were some questions from the bidders 5-24-10 54 1 about that, but we have assured them the County will handle 2 that, and we'll work with them on the exact location of the 3 new arena. 4 COMMISSIONER OEHLER: We took care of that earlier 5 in awarding the bids. 6 JUDGE TINLEY: Any further question or further 7 discussion on the motion? All in favor of the motion, 8 signify by raising your right hand. 9 (The motion carried by unanimous vote.) 10 JUDGE TINLEY: All opposed, same sign. 11 (No response.) 12 JUDGE TINLEY: The motion does carry. Thank you, 13 Mr. Lewis. 14 MR. LEWIS: Thank you. 15 JUDGE TINLEY: We'll go to Item 10, which is 16 another 10 o'clock timed item, to consider, discuss, and take 17 appropriate action to approve the basic financial statement 18 and supplementary information audit for the period ending 19 September 30, 2009. Ms. Hargis? 20 MS. HARGIS: Gentlemen, we do have our auditor 21 here, Keith Neffendorf with Neffendorf, Knopp, Doss, and 22 Company. I'm going to let him present the audit for 2009. 23 MR. NEFFENDORF: Good morning. How are y'all 24 doing? 25 COMMISSIONER BALDWIN: Good morning. 5-24-10 55 1 MR. NEFFENDORF: Good seeing y'all. I think y'all 2 already got the electronic version. 3 COMMISSIONER BALDWIN: Okay. 4 MR. NEFFENDORF: I'll just pass these out. These 5 are the hard copies. 6 COMMISSIONER BALDWIN: Bet this cost. 7 JUDGE TINLEY: It's already paid for. 8 MR. NEFFENDORF: Yeah, right. No, not yet. But 9 that's all right; we'll wait. As you -- once again, I'm 10 Keith Neffendorf the with the firm Neffendorf, Knopp and Doss 11 out of Fredericksburg. We did the audit for the County for 12 the period ending September 30, 2009. And, basically, it's a 13 good financial report. We'll go over it -- or I'll go over 14 it and hit the high points. If you have any questions, you 15 can stop and ask me. 16 As you recall, GASB 34 became effective for the 17 year ending September 30, 2004. It was a major change for 18 governmental reporting for all counties, cities, schools. We 19 have to do two sets of financial statements. The first set 20 is done on the basis of the -- what I call the governmental 21 basis that everybody did for years, where you adopt your 22 budget; you show your tax rate. And then the second set, we 23 have to convert what they call GASB 34 statements. These 24 statements are supposed to be just like a business entity, 25 where you show all your depreciation, your fixed -- your 5-24-10 56 1 accumulated depreciation on your fixed assets, all your 2 long-term debt, and come up with a profit and loss just like 3 a business entity would. Now, there is a reconciliation 4 that's done between the -- to get from the governmental to 5 the GASB 34 which the Auditor does. Basically, the County's 6 responsibility is just to keep its records on the 7 governmental basis to show your budget-to-actual comparisons, 8 and the Auditor gets the joy of converting from governmental 9 to GASB 34. 10 Last -- the report format is the same, basically, 11 as it has been for years. There was one major change for the 12 GASB reporting. They came out with GASB 45, which is a 13 statement for accounting for the liability for the other than 14 pension benefits -- other than pension post-retirement 15 benefits, which, of course, is the retiree health care. And 16 there was an actuarial study done for the course; it's up 17 there by the firm to compute that valuation. Essentially, 18 that valuation -- and we'll go over that in a minute in the 19 notes. It's pretty easy. It's just like your retirement 20 system. The only difference being with your retirement 21 account through the Texas County and District Retirement 22 System, is you're actually funding that. This particular 23 benefit, you have a pay-as-you-go what your actual costs are. 24 But in accordance with the State, you also have to compute 25 actuarial liability, which is disclosed in this audit report. 5-24-10 57 1 Okay. So, I'm going to go through -- I'm going to 2 highlight some financial information. If you have any 3 questions, you stop and ask me, or later if you have some, 4 give us a call. And the only reason this is stamped 5 "preliminary draft," the note in the financial statements on 6 the airport operations, there is a difference in their 7 beginning fund balance, and I'll point that out later, about 8 200-something thousand dollars that was given to us. We 9 contacted the City's auditor, and Jeannie just gave me the 10 e-mail that's dated Saturday, the 24th, where he identifies 11 that difference and explains that difference. That's the 12 only reason this thing's drafted -- stamped "preliminary 13 draft," is we didn't have the -- and I'll show you that; I'll 14 show you the notes where that difference is. Okay. So, 15 after the index on Page 1 is the independent auditor's report 16 that just says we made an audit of the financial statements 17 of Kerr County as of and for the year ending September 30th, 18 2009. In the third paragraph there, we state that our 19 financial statements referred to above present fairly the 20 financial position of the County as of September 30th, 2009. 21 This is the standard auditor's clean opinion letter. 22 Unqualified opinion. 23 The first section, Management Discussion and 24 Analysis, Pages 2 through 8, is a requirement of GASB 34. 25 We're not required to audit it. That's why it's labeled 5-24-10 58 1 "Unaudited." What it is is a summary, financial information 2 and narrative highlight. It's real good for your readers. 3 I'm not going to go over it; I do my own highlights. But 4 we've been told by a lot of readers of financial statements 5 that they can understand this better than looking at all 6 those financial statements, 'cause it is a condensed version. 7 The first statement we give an opinion on is on Page 9, 8 statement of net assets. This is the equivalent of a balance 9 sheet for the county as of September 30, 2009. And as you 10 recall, this is under GASB 34. It includes all your fixed 11 assets, the rate of depreciation, your long-term debt. So 12 you can see your total assets for the county, including all 13 your fixed assets, end of year, 53,225,000. Your 14 liabilities, including your long-term debt, were 6,133,000, 15 so you had net assets of 47,091,000. That net assets would 16 be the equivalent of retained earnings or stockholders' 17 equity, so you can see the County is in good financial shape. 18 You have almost as much cash and cash equivalents as you do 19 long-term debt, and any business would love to be in that 20 position. 21 Pages 10 and 11 is statement of activities. This 22 is equivalent of an income statement. It's in a format 23 required by GASB 34, but in the end, it comes up with the 24 same thing, the net profit or loss for the year. First 25 column is expenses. Shown there, including depreciation for 5-24-10 59 1 those activities, coming up to a total expenses under GASB 34 2 for the 24,475,000. Subtract off what they call program 3 revenues, charges for services; these are all the fees, fines 4 collected by the J.P.'s, County and District Clerk, Tax 5 Assessor/Collector. Operating grants and contributions, the 6 moneys you get from the State for the judges' supplemental, 7 County Attorney, and some other items. Then you come up with 8 a net expense there shown in that column, 19,896,000. How 9 that is funded is shown below. General revenues, property 10 taxes, between the two of them about for general and debt 11 service about 14.8 million. The other taxes, the bulk of 12 that of sales tax, 2.9 million. Then you have your grants 13 and contributions, miscellaneous revenue, investment 14 earnings; come up with total general revenue of 19,286,000. 15 So, your net loss for the year last year was 610,249. 16 Pages 12 and 13 is the governmental funds balance 17 sheet. And as I said before, this is under governmental 18 basis, and it shows the major funds across the top there. 19 Your general fund, Road and Bridge fund, the health care 20 funds, and then capital projects and your other funds. These 21 are all your special revenue funds, and then it comes up with 22 a total. General fund, of course, had assets of 3,464,000, 23 liabilities of 1,301,000; net fund balance of 2,162,000. 24 Road and Bridge assets, 456,000; liabilities, 137,000. Fund 25 balance of 319,000. And the total column over there for all 5-24-10 60 1 the funds of the governmental, 6,436,000. Liabilities of 2 1,655,000. Net fund balance of 4,780,939. So, basically, 3 the fund balances are in good shape. The general fund is a 4 little below what we would like to see. It was about a 13 5 percent; we like to see in the 20 to 25 percent range. 6 Overall, the governmental funds, though, as a whole are 7 between that 20 and 25 percent range, so still in good shape. 8 You take that fund balance figure of 4,780,000 to 9 the next page; this is how we reconcile the governmental to 10 GASB. Of course, your big item is we add back the cost of 11 the fixed assets minus the depreciation, minus the long-term 12 debt. That's the $40,028,000 figure. We add back your 13 current year capital outlays, long-term debt principal 14 payments, 2,069,000. Subtract the depreciation expense last 15 year, 1,828,000. Then you have other adjustments that we're 16 required to make the -- from the modified accrual to full 17 accrual accounting. These have to do mainly with your 18 recording of your fines and fees receivable, and then your 19 taxes receivable, $2 million. So, the net assets under GASB 20 34 are 47,091,000. 21 Page 15 and 16 is the governmental fund revenues 22 and expenditures statement. This is, again, on the 23 governmental basis. The general fund had revenues of 24 16,442,000, expenditures of 16,910,000, so you had a deficit 25 of 467,000. After your proceeds from capital out -- capital 5-24-10 61 1 leases, and your transfers in and transfers out, your net 2 change in fund balance for the general fund was a deficit of 3 411,000. Road and Bridge had revenues of 2,613,000, 4 expenditures of 2,791,000, deficit of 177,751 for the year. 5 The other funds are shown there, again, for the health care, 6 capital projects, and all your special revenue funds. The 7 total governmental funds revenues, 23,883,000. Expenditures, 8 24,587,000. Deficit for the year is 703,000. After your 9 lease-purchase proceeds, transfers, other financing sources, 10 you had a net deficit for the year, governmental basis, of 11 596,000. Reduced the fund balances from 5.3 million to 4.8. 12 The next page, you start out with that net change. Deficit 13 of 596,000 on the governmental basis. Add back your current 14 year capital outlays, long-term debt principal payments, 15 little over $2 million. Subtract depreciation expense, 1.8 16 million. Subtract your adjustments from the modified accrual 17 to accrual basis. Like I said before, this has to do with 18 your fines and fees receivable and your taxes. You come up 19 with your net change under GASB 34, deficit of 610,000. 20 Page 18, fiduciary net assets. These are your 21 trust funds; mainly have to do with the agency funds for all 22 the offices, the cash that is held. That's why there is no 23 fund balance; it's due to others. Page 19 starts the notes 24 of the financial statements. The first part of the notes was 25 just an explanation of what I've already gone over, 5-24-10 62 1 explaining the governmental accounting, use of funds for 2 governmental accounting, and then the conversion to GASB 34. 3 The first note I'd like to go over and point out starts over 4 on Page 25, the deposits and investments. The County, of 5 course, has to comply with Public Funds Investment Act, and 6 as of the end of the year, the amount of the deposits at the 7 bank were 953,000, and those were all covered by FDIC 8 insurance or pledged securities. The middle of that page -- 9 or toward the bottom, we show the listing of the deposits and 10 temporary investments. This has to do -- lists your C.D.'s 11 with the various banks and your TexPool amount of 2.8 million 12 to come up with your total investments at the end of the year 13 of 5,536,000. And on the next page, all your investments are 14 in accordance with the Public Funds Investment Act, as the 15 C.D.'s are either covered by depository insurance and/or 16 pledged collateral. TexPool is considered a governmental 17 investment pool, and even though its balances are not secured 18 by FDIC coverage or pledged securities, they have built-in 19 safeguards, and they are in accordance with the Public Funds 20 Investment Act. Therefore, all your funds/moneys are in 21 accordance with the Public Funds Investment Act. 22 COMMISSIONER BALDWIN: Where are you seeing 23 TexPool? 24 MR. NEFFENDORF: The bottom -- very last page, 25 bottom of 25, the TexPool. 5-24-10 63 1 COMMISSIONER BALDWIN: Yeah, okay. I'd already 2 gone to 26. 3 MR. NEFFENDORF: Yeah. The other notes just 4 provide additional disclosure to the financial statement. 5 Page 27, Note 3.D gives a summary of your capital assets, the 6 changes for the year, the assets/additions, and then it also 7 gives a summary at the bottom showing you accumulated 8 depreciation for all those various assets. Likewise on top 9 of Page 28, gives the summary of the depreciation expense of 10 the year, 1.8 million. Note 3.F, long-term liabilities, that 11 just shows the beginning balance in your debt for your bonds, 12 certificates of obligation payable, and your capital leases. 13 Shows the amount; you only issued last year a 95,000 capital 14 lease; you paid off on 1.3 million, so your ending balance 15 was reduced to 4,411,000. And then, of course, Page 29 gives 16 a summary then of the those certificates of obligation notes 17 payable, gives the details of those, the balances. And at 18 the bottom of the page, those are the requirements due under 19 those obligations over the next four years. And likewise, on 20 Page 30, for the capital lease obligations, shows the same 21 thing; the balances and what the obligations are over the 22 next five years. 23 Page 31 is the retirement system disclosure. This 24 information is provided to us by them, and it just gives a 25 summary of the plan description, funding policy. Last year 5-24-10 64 1 your retirement costs for the county was 1,239,952. And on 2 Page 32, it gives a summary of the actuarial value 3 information. At the bottom of that page, you can see the 4 valuation. The latest one was 12/31/08, and at that time, 5 the County had -- the value of the assets was 20,565,000. 6 The liabilities was 24,950,000, so you had unfunded liability 7 of 4,384,000, which is about 82.4 -- 43 percent. As you can 8 see, that percentage went down as the retirement system, like 9 most other people, took hits in the investment area. And 10 that's typical of most of the counties that we've seen. You 11 see about a 5 to 6 percent drop in the funded ratio. 12 COMMISSIONER WILLIAMS: That's due to the market? 13 MR. NEFFENDORF: Right. 14 COMMISSIONER WILLIAMS: Due to market issues? 15 MR. NEFFENDORF: Right. And I'm sure the 12/31/09 16 valuation numbers are going to be even worse. Note 3.H, top 17 of Page 33, this is the disclosure required under the joint 18 venture with the City, and that just shows the assets, 19 liabilities, net assets, and revenues and expenses last year 20 for the airport operation. And this is the figure that was 21 in question. At the very end there, they have the net 22 assets, beginning, possible restatement, 6,995,000. 23 Actually, that number should have been the prior-year ending 24 number, which was 6,780,000, which is a difference of 25 214,319. Which I think Jeannie has given you a copy of the 5-24-10 65 1 e-mail from their auditor as to what happened there. Note 2 3.1 on Page 33, risk management. That just gives the 3 disclosure for the workers comp, unemployment, and property 4 and liability coverage through TAC. The other notes are 5 pretty much standard. 6 The other one that's new was on Page 35, Note 3.M, 7 post-retirement benefit other than pension benefits. That's 8 the GASB 45 requirement that we're now under. It just gives 9 a basic plan description, and then shows over on Page 36 the 10 funding policy. Under GASB 45, the actuarial valuation 11 determined that your required contribution should have been 12 315,000. You paid only 58,000, so you had a net obligation, 13 end of year, of 256,000. And their evaluation, just like for 14 the -- similar to the retirement system valuation, showed an 15 unfunded liability of 2,685,000. And then they give the 16 summary of their actuarial methods and assumptions. And then 17 Note 3.N, subsequent events. The County did issue 4,350,000 18 in tax notes; that's disclosed there. 19 Required supplementary information schedules, Page 20 38, the general fund budget-to-actual comparisons. Revenues, 21 final amended budget, 17,477,000. Actually recorded, 22 16,442,000, so you had a deficit of $1 million -- little over 23 a million dollars in revenues. Your expenditures, your final 24 amended budget, 17,398,000. You only spent 16,910,000. 25 Positive variance of 487,000. So, overall, you had planned a 5-24-10 66 1 net change positive of 29,000; actually was a deficit of 2 411,000, so we had an unfavorable variance in the budget of 3 441,000. Of course, the investment earnings, taxes, and 4 sales tax were all down a little bit. Road and Bridge, Page 5 39, budget-to-actual, revenues, final amended, 2,673,000. 6 Actually recorded 2,613,000. Deficit of 60,000. 7 Expenditures, your final amended budget, 2,831,000. Actually 8 spent 2,791,000, so you had a favorable variance of 39,000. 9 So, overall, you had planned a deficit of 157,000. It 10 actually was 177,000, so you had an unfavorable variance of 11 20,606. 12 The other supplemental schedule is just that 13 funding progress that's required to be shown as a 14 supplemental schedule for the retirement plan, and we've gone 15 over those numbers. The other letter in there is the -- in 16 addition to our audit, we had a test for internal control 17 over financial reporting. We found no major weaknesses, and 18 we also had a test for compliance with laws, contracts, 19 regulations and grants; we found no incidences of 20 noncompliance. So, basically, the County is still in good 21 financial shape. Your moneys are secured in accordance with 22 the Public Funds Investment Act. You had small 23 differences -- unfavorable differences in the budget, but in 24 a $24 million budget, you only had 400,000; it was pretty 25 close. And that was all due to some revenues not coming in 5-24-10 67 1 as they anticipated. And your fund balances, like I said 2 before, overall your governmental is right in line with the 3 percentages. Your general fund should be -- hopefully we can 4 get that back up a little bit. 5 COMMISSIONER BALDWIN: Right in line with the 6 percentages? Now, -- 7 MR. NEFFENDORF: Mm-hmm. 8 COMMISSIONER BALDWIN: -- compared to what? 9 Compared to other counties? Or -- 10 MR. NEFFENDORF: Well, yeah. I mean, there is no 11 hard and fast rule. There's nothing in the law that says you 12 -- you know, what is an adequate fund balance? The 13 Comptroller's office has come out with a guideline of 25 14 percent, and that's -- the rule of thumb for years has been 15 three months operating expenses is a -- you know, is a 16 reasonable fund balance. Now, there -- you know, there's 17 always variables in that amount. You can have some -- 18 obviously, you can have some stuff that makes you want to 19 have more fund balance, if you know you've got a bunch of 20 outdated equipment and stuff like that, that you don't want 21 to go out and issue debt for, that you could be holding 22 moneys back or putting them in reserve. But, generally, that 23 -- that's the rule of thumb, is the 25 percent or three 24 months operations. That's not a -- that's not a hard and 25 fast rule; it's just a guideline. 5-24-10 68 1 COMMISSIONER WILLIAMS: The percentage of revenues 2 lost against budget -- budgeted anticipated revenues, 3 400-some-odd thousand against 24 million, about what, 2 and a 4 half percent? 3 percent? 5 MR. NEFFENDORF: Yeah. 6 COMMISSIONER WILLIAMS: And that's due basically to 7 just the economy. 8 MR. NEFFENDORF: Right. Sales tax was down a 9 little bit, and the investment earnings took a big hit. 10 MS. HARGIS: Yeah. I did a draft that came off of 11 my program -- excuse me -- and I'm going to hand it out. 12 COMMISSIONER BALDWIN: Would you say that last part 13 again, please? 14 MR. NEFFENDORF: About the -- the differences in 15 revenues? The investment earnings took a big hit. Went -- 16 your investment rates went way down. 17 COMMISSIONER BALDWIN: Okay, yeah. 18 COMMISSIONER OEHLER: Fines and fees went down 19 some. They're coming back a little, but the fence right down 20 the middle of I-10 had something to do with that. 21 MR. NEFFENDORF: And, generally, we hear that a 22 lot. The governments, the counties, cities, we found that 23 across the board, that there was an overall decrease. Pretty 24 much everybody took some hits in sales tax and the fines and 25 fees. And that's -- 5-24-10 69 1 MS. HARGIS: If you'll look at the second page, at 2 the pie chart on the revenues, the pie chart shows that we're 3 at 77 percent property tax revenue for last year. And in the 4 prior year when I ran that, it was only 66 percent. So, our 5 sales tax was running, at the end of '09, about 14 percent 6 down. Our fines and fees, as you know, were running probably 7 close to 40 percent down. So, we took the economic hit 8 pretty much on -- on our sales tax and on our fees and fines. 9 That's pretty much where it is. The I-10 corridor helped, 10 but we also had a reduction in our normal District Clerk fees 11 and County Clerk fees. We talked about this during budget 12 last year; I think we were all aware. Our sales tax is 13 coming up. It's still not wonderful. We're, like, 9 -- 14 instead of being 14 percent, we're running about anywhere 15 from 8 to 9 percent as of this month; 6 percent for the 16 month, but 9 percent for the year. Our fines and fees for 17 the courts are down. Keeping -- I mean, they're in line with 18 our budget, but remember, I reduced them dramatically. So, 19 the J.P. courts fines and fees are still down. They're still 20 not running what they have in the past. So, again, I think 21 some of this, again, is based on economic flow. We're not -- 22 the clerks' offices were not getting money from a lot of 23 lawsuits in the district court that would be filed in good 24 times. 25 We're not getting sales from houses. We're not 5-24-10 70 1 building houses. We're starting to build. I understand from 2 one of the local architect firms that Comanche Trace has 3 probably got 10 -- he alone has 10 new starts, so it's 4 starting to come back. But, you know, I think by the end of 5 this quarter, I think we'll see, you know, some dramatic 6 changes going upwards, 'cause summer months is when our sales 7 tax comes up. Our river's up. That's another thing; last 8 year we had the drought. The river was down. People didn't 9 come because of that. So, I'm hoping our tourism sales come 10 back up this year. So -- but, you know, that -- that's 11 traumatic when you look at that pie chart. We went from 66 12 to 77 percent, depending on our property taxes. So -- and 13 actually when I came here, it was closer to almost 56 percent 14 property tax, and the rest was sales tax, so we've taken a 15 real hard turn the other direction. They always tell you 16 never to depend on sales tax. I mean, from the other 17 municipality environment, one of the things they try to tell 18 city managers is don't depend on sales tax; sales tax is 19 volatile. And I think we're seeing that more now than we 20 have seen in probably 20 years. So, you know, those are the 21 things we need to consider when we go into our budgeting, but 22 it's kind of eye-opening when you look at the overall bottom 23 line. 24 MR. NEFFENDORF: Much easier to withstand a 10 25 percent hit in sales tax than it would be a 10 percent 5-24-10 71 1 adjustment in your property valuation. That would be very -- 2 and so far, in the central Texas area, at least, the 3 valuations have been staying -- staying pretty good. 4 JUDGE TINLEY: Ms. Hargis, the -- the difference in 5 the airport fund, does that have a direct relationship to the 6 so-called found funds that -- 7 MS. HARGIS: No, it's an error. It's just a flat 8 error on the auditor's part, and our auditors picked up on 9 it. And we asked for a correction two weeks ago. The guy 10 was out of town. Comment was, "Well, I'm out of town; I 11 can't find it." So, that's why we got it on Saturday. It 12 was the first thing I pulled up this morning. I'm 13 disappointed, but if they don't -- because it's not material 14 to their overall statements. This is the reason that I've 15 requested that the airport do their own audit, totally 16 separate from the City, totally separate from the County. 17 This is an integral part -- a component part of our audit. 18 We have to report on it. And because they just presented 19 their audit a week ago or two weeks ago, we can't present 20 ours, which means we're late on our disclosure requirement. 21 It's not fair to us. So, they budgeted $5,000 for an 22 independent audit. I believe they're agreeing to that, but 23 this will just give us more reason to say that we have to 24 insist that they do that. We cannot be late next year. We 25 were late this year, but our financial adviser said that we 5-24-10 72 1 -- you know, because we may need to go back to the bond 2 market in the next couple of years, which we're all aware of, 3 because of the jail, we can't afford not to do our disclosure 4 on time. Because that's what they're looking for now, is 5 your debt rating; you know, do your pay your debt on time? 6 Are you doing your disclosure on time? Are you punctual? 7 And we failed this year. We can only fail one time. So, we 8 will have our audit, and we will have it to them by March the 9 31st. 10 COMMISSIONER WILLIAMS: How is this rectified in 11 terms of airport net assets? 12 MS. HARGIS: Well, we have to put a note on 13 there -- I'm sure they'll have to put a note on there showing 14 that, you know, there was an error, and that the other 15 auditor did not -- because it's part of their audit. We 16 can't pull it out. That's the reason why. 17 MR. NEFFENDORF: We'll just have to put a note 18 under this section where it says net assets, beginning, -- 19 COMMISSIONER WILLIAMS: Mm-hmm. 20 MR. NEFFENDORF: -- 6,995,000. We'll have to come 21 up with -- we'll have to then show a difference adjustment 22 required, 214,319. I mean, the guys says it's immaterial, 23 but $214,000? 24 MS. HARGIS: To the airport, it is material. 25 COMMISSIONER WILLIAMS: It's not immaterial. 5-24-10 73 1 MR. NEFFENDORF: No. And then the thing is 2 obvious, because if you -- your beginning net assets in one 3 year have to tie back to what you showed at the end -- ending 4 assets the other year. Now, you know, it's true that there 5 could be -- you could always have prior-period adjustments 6 where something came up, but you still should start out with 7 what you ended with, and then have some explanation of why 8 you're adjusting that to get to your new number. But, 9 anyway, that's beside the point. 10 COMMISSIONER WILLIAMS: So, you would have a 11 footnote -- 12 MR. NEFFENDORF: Well, no -- 13 COMMISSIONER WILLIAMS: -- when you say that? 14 MR. NEFFENDORF: Right. That footnote, we're going 15 to show the -- what they ended with last year, per their 16 audit, financial statements. Then we're going to have a 17 prior-period adjustment that shows that 214,000 to come up 18 with this -- you know, net assets, beginning, restated. 19 COMMISSIONER WILLIAMS: Okay. Just so the onus is 20 on someone else, not us. 21 MR. NEFFENDORF: That's correct. 22 MS. HARGIS: This just substantiates why we should 23 be a better fiduciary responsible for their books than they 24 are. 25 JUDGE TINLEY: The explanation was that it wasn't 5-24-10 74 1 material to the City's statements where they include the 2 airport operations within their own statement? 3 MS. HARGIS: (Nodded.) And -- and usually that's a 4 5 percent variance, and in their statements it probably is 5 not material, but in the airport's, it is. 6 COMMISSIONER LETZ: Well, this has been an issue 7 we've had all along, that the airport should be accounted for 8 independently, and we've said that for -- 9 COMMISSIONER WILLIAMS: Years. 10 COMMISSIONER LETZ: -- years. And haven't gotten 11 anywhere on that. Well, we're about to -- we're getting 12 closer on that point. But it's -- and it's -- regardless of 13 whether the City does it or we do it, it's still -- the 14 financial part, it's an independent entity and needs to be 15 handled independently. 16 MS. HARGIS: Independently. 17 MR. NEFFENDORF: And timely. 18 COMMISSIONER LETZ: And timely. 19 COMMISSIONER WILLIAMS: That's very important. 20 MR. NEFFENDORF: That's right. 21 COMMISSIONER LETZ: Well, thank you. 22 MR. NEFFENDORF: You bet. 23 COMMISSIONER WILLIAMS: Thank you, sir. 24 COMMISSIONER LETZ: Very helpful. 25 MR. NEFFENDORF: All right. Appreciate it. 5-24-10 75 1 COMMISSIONER LETZ: Did we do better than 2 Fredericksburg? 3 MR. NEFFENDORF: I don't like to do comparisons. 4 (Laughter.) They never -- no. I mean, generally, in central 5 Texas, most -- most of these counties have stayed pretty 6 strong. Everybody -- we don't -- we're not like San Antonio 7 or Austin that are really hurting, 'cause they rely a lot on 8 that sales tax. Like I said before, our -- out here, the 9 property -- property valuations is the key. If we can keep 10 that up -- and the other thing I always like to tell people 11 too is, you know, on the Road and Bridge side, if the state 12 would let us keep more of that money that we have to send to 13 them, then we could keep the dough here. That would be -- 14 that would be a big boon. 15 COMMISSIONER BALDWIN: That would be huge. 16 MR. NEFFENDORF: Thank y'all. 17 COMMISSIONER BALDWIN: Thank you. 18 COMMISSIONER OEHLER: Thank you. 19 JUDGE TINLEY: You need a formal approval of the -- 20 of just the basic financial statement, supplementary 21 information audit? 22 MS. HARGIS: Yes, please. 23 JUDGE TINLEY: Or the entire -- 24 MS. HARGIS: The entire document. 25 JUDGE TINLEY: Okay. Okay. 5-24-10 76 1 COMMISSIONER BALDWIN: So moved. 2 COMMISSIONER LETZ: I'll make a motion we approve 3 the audit as presented. 4 COMMISSIONER WILLIAMS: Second. 5 JUDGE TINLEY: Motion made and seconded. Question 6 or discussion on the motion? All in favor of the motion, 7 signify by raising your right hand. 8 (The motion carried by unanimous vote.) 9 JUDGE TINLEY: All opposed, same sign. 10 (No response.) 11 JUDGE TINLEY: The motion does carry. Let's take 12 about a 15-minute recess. 13 (Recess taken from 10:41 a.m. to 11:01 a.m.) 14 - - - - - - - - - - 15 JUDGE TINLEY: Okay, let's come back to order, if 16 we might, from our mid-morning recess. We've got a timed 17 item for 10:30, Item 12, which we'll take up now. Consider, 18 discuss, and take appropriate action to approve the Kerr 19 County retiree health care plan actuarial valuation report as 20 of December 31, 2008. Mrs. Hargis? 21 MS. HARGIS: Right. You get stuck with me to make 22 this presentation, because otherwise I had to pay the guy 23 $1,200, so you're stuck with me. 24 SHERIFF HIERHOLZER: May have been worth it -- oh. 25 MS. HARGIS: If we could go to the first page, 5-24-10 77 1 Tess? Before we get started, I just wanted to define some 2 terms so that you can understand what they are. OPEB is 3 other post-employment employee benefits. Our OPEB, our 4 post-employee benefits other than pension. OPEB generally 5 takes the form of health insurance and dental, vision, 6 prescription drugs, and other health care benefits. Go back. 7 The reason I did this after the audit is it kind of gives you 8 a general overview of -- of what the two methods of 9 accounting are. The fund accounting basis is generally a 10 modified -- what we call modified cash basis. Generally 11 speaking, we do our books on a cash basis; money comes in one 12 month, we spend that month, and that's it. What they want in 13 GASB 45 is a full accrual that looks like -- for better, like 14 Exxon financial statements. So, we're putting back in that 15 type of -- of a -- you know, we have two ways of doing it, 16 and we'll get to those. One is pay as you go, and one is to 17 fund it. So, we can go to the second one. 18 This one, just really quickly, says that we had to 19 implement it as of 12/31/08. Statement 43 applies to 20 prefunded OPEB plans. We didn't prefund this plan, and I 21 don't recommend that we do. 45 applies to employers 22 sponsoring a pay-as-you-go method, which is what we're doing. 23 We have not set up a trust for this, because if we did, we 24 would be in 43. And to do a trust, we'd have to actually set 25 money aside, set it up in a trust, very similar to what they 5-24-10 78 1 do to our retirement benefits. And, again, we have not done 2 that. The next one, 43 and 45. The main thing with all of 3 these is that you disclose what the contribution would be on 4 your financial statement so that the taxpayers know that you 5 have an unfunded liability. When he talked about a 6 description -- let me go through this a little bit slower. 7 The discounted rate of 4.50 is unfunded; that's what we 8 receive in his actuarial stuff. The prefunding is 7.5. If 9 we prefunded it, we would get a better discount. The 10 discount applies to interest revenue and our assets as a 11 whole. In other words, how strong are we with our assets, 12 and how can we put it in there? And the financing, again, is 13 pay as you go, or the level of percentage would be prefunded. 14 The total present value -- this is the scary part. 15 The total present value of the future benefits is 4,778,879. 16 That's based on the -- the employees that we had as of 17 12/31/08. Prefund would be 2,770,000. The present value -- 18 that's today's value -- is 2,093,046, and prefunded would be 19 a million, eleven. Unfunded actuarial value. This is what 20 you saw in the audit. This is what they're saying we're 21 going to owe in the next 20 years, 2,685,863. This is on 22 health care benefits for retirees. 23 COMMISSIONER WILLIAMS: Over what period of time? 24 MS. HARGIS: Over 20 years. 25 COMMISSIONER WILLIAMS: Twenty years. 5-24-10 79 1 MS. HARGIS: Okay, the next slide. This breaks it 2 down to a monthly plan. Under the -- the center column, the 3 4.5 is our discount. That brings our normal cost down 4 annually of 204,000. You amortize that cost over the 20 5 years, and your annual required contribution, which is the 6 ARC, is 315,730. The ARC per active participant is 1,349. 7 That's based on an age of 45.6, the average age of 45.6. 8 This kind of shows you the member and the measurement and the 9 percentile of other entities, comparing us to other entities, 10 and we're about in the 27 percentile of cost based on what we 11 do. All right. Let me back up to that one just a little 12 bit. When I say the cost of what -- what we do, we -- in our 13 plan, we offer retirees retirement health benefits. We also 14 have a health insurance plan where we pay 60,000 per 15 participant, so that's all taken into consideration when they 16 come up with this 1,349. Okay, next slide. 17 The current pay as you go is, they take the claims 18 and the supplemental payments of 97,000, the premiums we 19 actually collected for the retirees, so that came down to 20 58,941. That's where you're getting the pay-as-you-go 21 reduced amount. Then our obligation being 315, less the 58, 22 gives you a total there of 256,789. Before we go to the next 23 slide, again, we have another term here, and I highlighted 24 these, because I have a hard time. The NOO is not "no" and 25 is not misspelled. This amount is known as the net OPEB 5-24-10 80 1 obligation. Each year, the NOO accumulates with interest 2 plus the difference between the ARC; that's the 1,349, and 3 the actual contributions for the year, plus some technical 4 adjustments, so that can change, that bottom line. But, for 5 right now, that's the number we get to use for the next two 6 years. We -- we have to have -- according to the GASB 7 statements, we have to have these studies done every two 8 years, so we'll be looking at doing this again in 2011. The 9 next slide, please. 10 And the last one just gives you a flowchart of how 11 we can do it. We can either do -- keep it as it is, we can 12 change it, we can do nothing, we can end the plan, we can 13 prefund the plan. If we prefund it, we can put it in a 14 trust. You can earmark it. You can put cash in, and it's 15 got bond at the end, which I do not recommend, and is to sell 16 a bond issue to prefund this amount. Because this amount 17 could get larger, most probably will get larger, just based 18 on the population. If we grow, the numbers are going to 19 grow. The actuarial -- I asked him. I said, technically 20 speaking, I mean, it's a big number, 2 million, 8. What are 21 the other counties doing? I mean, what do they recommend? 22 Right now, they don't recommend that we do anything but 23 accumulate this on our finance statements, at least for the 24 next three to four years, because of the health care reform 25 that's out there, number one. And number two, the plan could 5-24-10 81 1 change drastically. 2 Most -- most entities who are doing this are not 3 prefunded, because it's an astronomical number. The problem 4 is going to come when the number gets so large on our 5 financials that we're going to have to think about funding 6 part of it, and that lands you in the three- to four-year 7 range. So, in three to four years, we're going to have to 8 budget a pretty large number to start putting back towards 9 funding this. I don't know when the County started this 10 program, but we didn't have to. Counties don't have to do 11 this until have you a population of 75,000 people. The City 12 of Kerrville currently is not doing it because they don't 13 have a population of 25,000. If they go over 25, then -- 14 then state law requires them to start funding their health 15 insurance plan. But we may need to look at options on our 16 plan, and perhaps making sure that the 97,000 is covered. 17 Now, there's different options we need to look at. Perhaps 18 during the budgeting period, we might review those options. 19 But keeping in mind when we go out to the bond 20 market, no one really knows how that's going to affect our 21 rating or how it's going to affect the buyers of the bonds. 22 Are they concerned about this unfunded liability? Do they 23 realize it's a pay as you go? Currently, I think we have 14 24 people -- is that correct? Fourteen people who are 25 participating in the program. They're changing the over-65 5-24-10 82 1 health insurance, so it may be more advantageous for a lot of 2 folks to go that direction. We haven't really -- and we 3 can't, as I understand, encourage necessarily that they go 4 with -- with the Medicare programs, but it may be that we get 5 to a point where the cost of ours and the cost of Medicare 6 are the same, and then they -- they might be able to choose. 7 But, you know, I don't want to necessarily say to the Court 8 what the -- you know, let's don't do it any more. We've 9 already got it in place; I'm not sure that's a real good 10 option. You could do that. As he said, you could end the 11 program. You have 14 people; you grandfather the 14 people 12 and we stop. Or you fund it -- you just -- you come up with 13 an amount to offset the retirees, but you're still going to 14 have a cost. And that cost is going to be -- need to be put 15 out there and put on your financial statements. It's kind of 16 hidden in your financial statements. On your net assets 17 statement, if you go down to the long-term liability section 18 there, the very last number that says long-term debt for more 19 than one year, that's where that 246,000 is -- 256,000. 20 COMMISSIONER BALDWIN: Let me ask you a question. 21 What would be wrong with kind of putting it in neutral right 22 now and -- until we do reach that population level where 23 we're required to participate, and then start at that point? 24 I mean, what would be wrong with that? What's the down side 25 of that? 5-24-10 83 1 MS. HARGIS: Well, right now I'm not prepared to 2 answer that. I would probably need to make sure that legally 3 we can do it. And -- and -- 4 COMMISSIONER BALDWIN: I thought you just said that 5 we could. 6 MS. HARGIS: We can. We can, but I need to see 7 what the repercussions are. I don't know whether that would 8 be real popular amongst some of the folks. But I think, you 9 know, that's a real strong possibility. It's a real strong 10 possibility. 11 COMMISSIONER BALDWIN: You're talking about setting 12 aside a large -- quote, large amount of money. What is a 13 large amount of money to you? I mean, what are we talking 14 about? 15 MS. HARGIS: Well, present value, 2 million, 8 is a 16 large amount of money to me. 17 COMMISSIONER BALDWIN: That's a large amount of 18 money to me, too. So, you're talking about setting aside 19 that amount of money annually? Or what -- what are you 20 talking about? 21 MS. HARGIS: Well, you can either do it -- you can 22 do it in one lump sum by setting -- by selling a bond issue 23 and setting it aside in a trust fund. 24 COMMISSIONER BALDWIN: Right. 25 MS. HARGIS: You can pay as you go, which means you 5-24-10 84 1 start funding that liability on an annual basis, which is the 2 315,000. 3 COMMISSIONER BALDWIN: Per year? 4 MS. HARGIS: Per year right now. 5 COMMISSIONER BALDWIN: Okay. I see what you're 6 saying. 7 MS. HARGIS: So -- 8 COMMISSIONER OEHLER: Where do you -- I mean, how 9 many -- how did you come up with the number of people that 10 are projected to be -- to retire, to receive these funds? 11 MS. HARGIS: Based on their ages. 12 COMMISSIONER OEHLER: The ages. But -- but that's 13 based on the ones that we know right now that probably will 14 retire from Kerr County? 15 MS. HARGIS: Yeah. It's based on the number that's 16 going to to retire. But -- 17 MS. HYDE: When we did this -- I worked with 18 Jeannie on the GASB's, so most of those numbers that she got 19 for GASB, they came from me, okay? 20 MS. HARGIS: Because I am not privy to that. 21 MS. HYDE: When we got the first numbers back, 22 Jeannie had to pull me off the ceiling. True? 23 MS. HARGIS: 'Cause they were too high. 24 MS. HYDE: They were way too high, because of the 25 way that we fund. We had to look at our average age -- and 5-24-10 85 1 that's what she was telling you; our average age is about 45. 2 So, by the time we get to 60, you got about 15 and a half 3 years to start funding this. Now, Jeannie's also telling you 4 our President is making a lot of changes to what we can and 5 cannot do, so we don't know that we can take away any benefit 6 that we had in place as of January 1 of 2010, period. We 7 don't know that. 8 COMMISSIONER OEHLER: Well, you know, and the thing 9 is, there will be some mortality along the way for people 10 that have already retired. 11 MS. HYDE: Yes. The problem -- 12 COMMISSIONER OEHLER: It won't be funded once 13 they're gone, and so you're going to have some of that. I 14 mean, it's hard to -- I can't -- 15 MS. HYDE: The problem is, we have two age groups 16 that are extremely large. 17 COMMISSIONER OEHLER: Mm-hmm. 18 MS. HYDE: Our age group -- how'd I do that on that 19 one, Buster? 20 COMMISSIONER BALDWIN: Did pretty good. You 21 pointed toward me. 22 MS. HYDE: Absolutely. Our age group is a very 23 large one. And that's the one that's going to hit us first. 24 MS. HARGIS: Mm-hmm. 25 MS. HYDE: That's going to -- 5-24-10 86 1 COMMISSIONER OEHLER: Providing that they stay 2 employed at Kerr County. 3 MS. HYDE: Yes. 4 MS. HARGIS: Well, they just have to reach the 5 eight years and retire with the eight years, and they're 6 eligible. 7 MS. HYDE: Then they're eligible. 8 MS. HARGIS: So it doesn't mean that they retire 9 with us; it just means they've been here eight years and 10 they're eligible, so they come back around at 65. 11 COMMISSIONER OEHLER: Okay, I'm beginning to 12 understand that part. I didn't -- that was the part I didn't 13 get. 14 MS. HARGIS: So that's the part that's a little bit 15 haunting, because we could have people that have been here 16 eight years. They quit, they retire, they don't work any 17 more, but they knock back on the door when they're 60, 18 because, "Oh, I earned it." 'Cause that's what it says. 19 So -- 20 MS. HYDE: But -- but we changed the thing this 21 year, so the good news is, they only have 30 days. 22 COMMISSIONER LETZ: Once they turn 60? 23 MS. HYDE: You're darned tootin'. Remember, y'all 24 didn't really like it; one of the Commissioners kind of was 25 angry with me for a little bit, but we changed it. So, we've 5-24-10 87 1 been doing changes, and some of them were not popular 2 changes, but that's why. And they only get one bite at the 3 apple. There have been several that have contacted their 4 Commissioners, and then, in turn, contacted me to try to get 5 back on the insurance. And it's been -- I'm really 6 empathetic, but you have one chance, and you denied it. So, 7 that also helps us. 8 MS. HARGIS: But the mortality rate is included in 9 here. They are -- they've already figured -- 10 MS. HYDE: Mortality. 11 MS. HARGIS: -- mortality in here. That's what the 12 actuarial -- that's the reason for the actuarial study, 13 'cause we can't really look at that. Again, right now it's a 14 study. It -- you know, to read it, it's kind of a little bit 15 confusing. The main part of it is to understand the bottom 16 line and the retirement age, and then we need to sit down and 17 look at it and get some information on the federal 18 government, whether they're going to allow us, based on the 19 new health reform act -- check to make sure that the 20 population -- because it's going to be a long time before we 21 get to be 75,000, but we may be locked in under the new 22 health reform act. Because it says you can't change health 23 insurance, but I'm not sure if that's on retirement benefit. 24 We have to check that. But we need to -- we need to talk 25 about these options, perhaps in our workshops this year, and 5-24-10 88 1 decide that -- you know, how we're going to handle it. 2 Again, it will grow pretty quickly. And that's present value 3 money, 2 million, 8. 4 JUDGE TINLEY: Ms. Hargis, refresh my recollection. 5 What did we end up paying for this actuarial study? 6 MS. HARGIS: 5,000. 7 JUDGE TINLEY: 5,000, okay. 8 MS. HARGIS: Yeah. And he -- apparently in the -- 9 when we paid this, we didn't -- they don't include coming out 10 to present it, so you got me instead. Because I refused to 11 pay for that. 12 JUDGE TINLEY: I'm not critical about that. I just 13 wanted to refresh my recollection to see how much -- 14 MS. HARGIS: We went -- 15 JUDGE TINLEY: -- we rolled into this thing. 16 MS. HARGIS: The cities -- the G.F.O.A. got 17 together with municipalities and did a contract, kind of like 18 it would be through a buy board, for him to do these 19 actuarial studies for everybody for that amount of money, so 20 we kind of tag-tailed on that and were able to get one fairly 21 reasonable. So -- and I'm assuming they they're renewing 22 this contract every year with -- with these entities. But, 23 again, he -- I asked him, you know, what he would do, and he 24 said right now, now because of the new health reform, it's a 25 little bit more up in the air. If we didn't have that, we 5-24-10 89 1 probably could think about doing what Buster's talking about 2 doing. 3 COMMISSIONER WILLIAMS: What is required of us with 4 respect to this report, now that it's done? Just has to be 5 filed? Has to be a part of our annual audit, or what? 6 MS. HARGIS: It has to be part of our annual audit, 7 which you saw that it has been included. It's required for 8 this year, and then every two years, we have to redo it to 9 make sure that our numbers are current. Because, again, the 10 present value's going to change. The population's going to 11 change. The average age is going to change. 12 COMMISSIONER WILLIAMS: Federal requirements are 13 going to change. 14 MS. HARGIS: So right now, under GASB -- 15 COMMISSIONER BALDWIN: That means that we agree 16 with everything in here, huh? 17 MS. HARGIS: Well, you don't have to agree. You 18 just have to accept it. 19 COMMISSIONER WILLIAMS: Just have to know it. 20 MS. HARGIS: There's no -- there's -- 21 COMMISSIONER BALDWIN: I'll agree -- I'll vote to 22 accept that it exists. 23 MS. HARGIS: That's fine. That's fine. 24 COMMISSIONER WILLIAMS: Is that a motion? 25 COMMISSIONER BALDWIN: Darned right, it's a motion, 5-24-10 90 1 if we can get that far down the road here. 2 COMMISSIONER LETZ: Second. 3 JUDGE TINLEY: Vote to accept the report? 4 COMMISSIONER BALDWIN: Yes, sir. 5 JUDGE TINLEY: Okay. And a second. Further 6 question or discussion on the motion? 7 COMMISSIONER BALDWIN: We were down the road. 8 JUDGE TINLEY: All in favor, signify by raising 9 your right hand. 10 (The motion carried by unanimous vote.) 11 JUDGE TINLEY: All opposed, same sign. 12 (No response.) 13 JUDGE TINLEY: Motion does carry. Now we'll go to 14 Item 13; consider, discuss, take appropriate action to 15 approve the disposition policy. Policy was sent to all 16 elected and department heads for comments/suggestions, and 17 those suggestions and comments have been incorporated into 18 the policy. 19 MS. HARGIS: Okay. Unfortunately, you're stuck 20 with me a lot today. I have passed this around to everyone. 21 I've gotten comments, which I have incorporated, from the 22 different elected officials. I have just received another 23 comment from the Sheriff that requested that I take out the 24 gambling paragraph, because that would be under the criminal 25 statutes, and we wouldn't have anything like that; it would 5-24-10 91 1 go through a seized or forfeiture-type of an item. So, we 2 want that -- as you can see, I pretty much followed the 3 Government Code. The only difference was to mention 4 Gov.deals, and there -- we already are working with them, as 5 you know. 6 COMMISSIONER BALDWIN: May I ask a question, 7 please? Commissioner Number 2 here was bothering me at the 8 time you made a statement, so I wanted to get you to repeat 9 it, please. What was it the Sheriff said about gambling? 10 MS. HARGIS: The Section 2 -- there is a paragraph 11 in here that refers to the disposition of gambling equipment. 12 COMMISSIONER BALDWIN: Right. 13 MS. HARGIS: Because this is county-wide property, 14 not seized property, it would be very unlikely that we would 15 have gambling property to dispose of. It would most likely 16 -- and if we did, it would come under the criminal code, 17 which I don't have in here. So, he requested we just remove 18 that paragraph, because he has to follow the criminal code 19 when he does a forfeiture or a seizure. 20 COMMISSIONER BALDWIN: Okay. 21 JUDGE TINLEY: That's Paragraph 5, about a fourth 22 of the way down on Page 2. 23 MS. HARGIS: Yes. 24 JUDGE TINLEY: Okay. 25 COMMISSIONER BALDWIN: And what do you do -- what 5-24-10 92 1 do you do with that stuff? 2 SHERIFF HIERHOLZER: There are two codes. The 3 Local Government -- actually, the Government Code, not Local 4 Government Code, says one thing, and the Code of Criminal 5 Procedure says another. But, in reality, what happens is it 6 actually goes to the grand jury of that county, and your D.A. 7 controls it and then says what you can do with it, and it 8 refers back, and you have to report it to Austin and do all 9 that. But like we had to do with the last that we did seize, 10 it was sold, okay, but it has to be sold outside of the state 11 of Texas in a state where it was legal. 12 COMMISSIONER BALDWIN: Oh, I see. 13 SHERIFF HIERHOLZER: 18-wheelers had to come down 14 and take that. But there are different rules. And it's not 15 county surplus or County-owned property, so I just don't feel 16 that it needs to be in the County's disposition. It's 17 governed -- 18 JUDGE TINLEY: Forfeited property. 19 SHERIFF HIERHOLZER: It's forfeited property, 20 governed by the codes on how I have to dispose of it. 21 COMMISSIONER BALDWIN: Okay, good. Thank you. 22 JUDGE TINLEY: So, with the exception of the 23 deletion of that Paragraph Number 5 about a fourth of the way 24 down on Page 2, you're seeking approval of this disposition 25 policy? 5-24-10 93 1 SHERIFF HIERHOLZER: I think it was mentioned a 2 couple of places. 3 MS. HARGIS: Yes, please. And it does follow the 4 Local Government Code, and I have referred to all of those 5 sections that Jannett asked me to do. And there was also 6 property in excess of $500. It's a very low threshold, but 7 that is the Government Code. If it's over -- if it's over 8 $500, it has to go through Gov.deals. 9 JUDGE TINLEY: The first full paragraph after 10 seven, in the middle of Page 2, that also refers to the 11 disposition of gambling equipment. That would need to come 12 out too, would it not? 13 MS. HARGIS: Yes. 14 JUDGE TINLEY: Okay. 15 COMMISSIONER BALDWIN: So, we are basically 16 adopting the state law. 17 MS. HARGIS: Yes. 18 JUDGE TINLEY: He's quick today. 19 COMMISSIONER BALDWIN: I tell you, man. 20 COMMISSIONER WILLIAMS: Right on top of it. 21 COMMISSIONER BALDWIN: You're not going to get this 22 stuff by me. 23 MS. HARGIS: But if the governor's office comes 24 down and -- and audits us again, we can hand them a policy. 25 And they told us to keep it very simple, and we did. We just 5-24-10 94 1 gave them the law. But because you've signed off on it, and 2 therefore we won't have a problem with it. 3 COMMISSIONER LETZ: I'll make a motion we approve 4 the disposition policy as modified today. 5 COMMISSIONER OEHLER: Second. 6 COMMISSIONER BALDWIN: Second. 7 JUDGE TINLEY: Motion made and seconded to approve 8 the disposition policy as modified, with the deletions on 9 Page 2. Further question or discussion? All in favor of the 10 motion, signify by raising your right hand. 11 (The motion carried by unanimous vote.) 12 JUDGE TINLEY: All opposed, same sign. 13 (No response.) 14 JUDGE TINLEY: The motion does carry. We now go to 15 Item 15; consider, discuss, take appropriate action to 16 approve Kerr County policy book revisions, and the change to 17 mirror the Sheriff's Office format. 18 SHERIFF HIERHOLZER: Don't look at me. 19 JUDGE TINLEY: Explain to me the "change to mirror 20 the Sheriff's Office format." 21 MS. HYDE: If you open the book, sir, it now 22 mirrors their format, so that any changes that we make, it 23 makes it easy for the Sheriff's Office to incorporate into 24 his current policies. 25 JUDGE TINLEY: So, the numbered titles and 5-24-10 95 1 paragraph numbers correspond to what he's got? Is that what 2 we're dealing with? 3 MS. HYDE: No, sir, just the actual format itself, 4 so that all he has to do is copy and paste. 5 SHERIFF HIERHOLZER: It's the format I have. 6 And -- and what makes it easy, if this Court decides to 7 change a policy regarding any of the county's stuff, you can 8 change that one policy without having to change the whole 9 book. It's -- they're individualized in there where you can 10 substitute and change out and update, and it's format. 11 JUDGE TINLEY: Loose-leaf substitution. 12 SHERIFF HIERHOLZER: That's right. 13 MS. HYDE: Then the revisions that was in the front 14 of y'all's book, there were three pages of revisions. 15 COMMISSIONER WILLIAMS: These are all pretty minor. 16 MS. HYDE: Very minor. 17 COMMISSIONER LETZ: Very minor. Move approval as 18 submitted. 19 COMMISSIONER BALDWIN: Just a second. This 20 mirroring the Sheriff's -- you're adopting what the Sheriff's 21 doing, in other words? 22 SHERIFF HIERHOLZER: No. 23 MS. HYDE: No, sir. 24 SHERIFF HIERHOLZER: We would never admit to doing 25 that to each other. 5-24-10 96 1 COMMISSIONER OEHLER: Can't do that. 2 COMMISSIONER BALDWIN: Does that in any way -- does 3 that adversely affect us, our side, in any way? 4 MS. HYDE: All we did -- all we did was, we're 5 working well and playing well together. Because in the past, 6 when we changed some policies, the Sheriff's Office was not 7 -- didn't know. 8 MS. PIEPER: Not playing well. 9 SHERIFF HIERHOLZER: We didn't get along. 10 MS. HYDE: They didn't read the minutes. And so, 11 in an effort to work well and play well with the Sheriff's 12 Department, we are making this very simple for them. When I 13 hand to it them, they can copy and paste. 14 COMMISSIONER BALDWIN: I sense a little bit of 15 anger here. 16 MS. HYDE: No, we love each other. 17 COMMISSIONER BALDWIN: Oh. 18 COMMISSIONER OEHLER: Oh. Whose gun is loaded? 19 COMMISSIONER BALDWIN: It's a liquor store for 20 lunch today. (Laughter.) 21 COMMISSIONER WILLIAMS: In your notations on the 22 attachment, you talk about the need for a COBRA, FMLA, and 23 appendix -- 24 MS. HYDE: Well, we're ready to start training, 25 sir, so we have not really made any changes to these that I 5-24-10 97 1 need -- 2 COMMISSIONER WILLIAMS: We're adopting what we know 3 to be in place today. 4 MS. HYDE: Yes, sir, what we know. When FMLA 5 changes come out, we can revise -- 6 COMMISSIONER WILLIAMS: Got you. 7 MS. HYDE: Same with COBRA and HIPAA. 8 COMMISSIONER BALDWIN: I second whatever Letz is 9 fixing to say. 10 COMMISSIONER LETZ: I already said it. 11 COMMISSIONER BALDWIN: You've already said it? 12 COMMISSIONER LETZ: I made a motion to approve as 13 modified. 14 COMMISSIONER BALDWIN: Second. 15 JUDGE TINLEY: Motion made and seconded to approve 16 the Kerr County policy book as modified and presented. 17 Question or discussion on the motion? All in favor of the 18 motion, signify by raising your right hand. 19 (The motion carried by unanimous vote.) 20 JUDGE TINLEY: All opposed, same sign. 21 (No response.) 22 JUDGE TINLEY: That motion does carry. 23 MS. HYDE: Thank you, gentlemen. 24 COMMISSIONER LETZ: Thank you. 25 COMMISSIONER WILLIAMS: Thank you. Good job. 5-24-10 98 1 JUDGE TINLEY: We will now go to Item 20; consider, 2 discuss, take appropriate action on right-of-way acquisition 3 at Hermann Sons Road. Commissioner Letz, you mentioned that 4 you thought that could be handled in open session? 5 COMMISSIONER LETZ: I think we can. I think we can 6 try to handle them in open. If we need to go into closed, we 7 can. This one, on the right-of-way acquisition of Hermann 8 Sons Road, which has been kind of moved to where it is 9 because of TexDOT redoing Highway 27 right through there, 10 there's an alignment of Hermann Sons Road and Westwood Road. 11 Previously, the Court authorized me to go ahead and make the 12 offer letters and try to work out the right-of-way issues. 13 That's all been surveyed, or preliminary survey work's been 14 done. The amount offered was the -- was 10,000 an acre, and 15 that amount was based on the full appraisal that Mr. Beck 16 Gipson did when we were looking at acquiring some property, 17 basically right at that intersection, about a year ago. And 18 then in addition to the per-acre amount, there was a -- a 19 value of any improvements, which essentially, on all the 20 properties, would be a fence. I'm having a little bit of 21 trouble on a tract; may need to go up a little bit on that. 22 I just wanted to basically bring it to the Court's authority. 23 It will be within the budget that we granted to Road and 24 Bridge for this project. We're talking a little about -- I'd 25 rather not go into the details unless we do go into closed 5-24-10 99 1 session, but I'm requesting, I guess, authority to continue 2 to negotiate this right-of-way acquisition within the budget 3 constraints that are in the Road and Bridge budget. 4 COMMISSIONER WILLIAMS: How much acreage do you 5 need to straighten out this right-of-way? 6 COMMISSIONER LETZ: The total amount is about 3 7 acres total. And some of the land that's been -- the way 8 we're shifting it, will become county property that's 9 actually outside of a right-of-way; just be some dead land, 10 kind of these angles or such right there that there's 11 property that is deeded. I mean, the current road is deeded 12 to the County's nonprescriptive easement. We own it, and 13 we're shifting it. And I guess we could offer to sell a 14 little bit of it back to one property owner, but the way 15 those roads line up, the land's not usable for anybody for 16 any purpose, so we would just acquire this initial property. 17 JUDGE TINLEY: So, you're seeking authority from 18 the Court to continue to negotiate the matter within the 19 budget parameters? 20 COMMISSIONER LETZ: Yes, sir. 21 COMMISSIONER BALDWIN: I move for approval. 22 COMMISSIONER WILLIAMS: Second. 23 JUDGE TINLEY: Motion made and seconded for that 24 approval. Question or discussion on the motion? All in 25 favor of the motion, signify by raising your right hand. 5-24-10 100 1 (The motion carried by unanimous vote.) 2 JUDGE TINLEY: All opposed, same sign. 3 (No response.) 4 COMMISSIONER BALDWIN: How much is -- how much is 5 in the budget for this single project? Do we recall? 6 Anybody know? 7 MR. ODOM: Well, I have probably over 30,000. 8 COMMISSIONER BALDWIN: So, that's kind of close to 9 it. 10 JUDGE TINLEY: Item 21; consider, discuss, take 11 appropriate action on property acquisition in east Kerr 12 County for Road and Bridge equipment yard. Is that matter 13 going to require -- definitely require executive session? 14 COMMISSIONER LETZ: I think we can probably handle 15 that as well at this point. And if the Court wants to go 16 into detail -- it's more of -- it can be a general item, or 17 can be more specific if the Court chooses. The properties I 18 referred to earlier that we looked at several years ago off 19 Hermann Sons Road, you know, we couldn't come to terms with 20 the property owner. But Len and I discussed it again, and he 21 would like us to acquire property for an equipment yard in 22 east Kerr County. And Len wanted to put it on the agenda 23 today, I guess for authority for Commissioner Williams and 24 myself and Len to kind of work together on moving forward on 25 it. Don't have any specific tracts definitely identified. 5-24-10 101 1 We have some, you know, potential tracts. But, you know, if 2 we go into too much detail, then I think it does need to go 3 into executive session. But I want to make sure the Court's 4 aware that -- that we're looking at trying to find some other 5 property. We're not at the point of doing an appraisal, but, 6 you know, from preliminary contacts, they're pretty 7 interested in selling possibly, and I want the Court to be 8 aware of what we're doing. If we get to the point of actual 9 negotiations, that would come back to the Court as an 10 executive session item, the parameters for that. 11 JUDGE TINLEY: Seems reasonable. 12 COMMISSIONER BALDWIN: Did we budget anything for 13 that specific issue? 14 COMMISSIONER LETZ: I do not believe so. 15 COMMISSIONER WILLIAMS: No. We talked about it. 16 COMMISSIONER LETZ: Talked about it. 17 COMMISSIONER BALDWIN: Well, it would be probably 18 -- at the rate we're going -- the speed we're going with this 19 thing, it would be after this next budget's approved anyway, 20 wouldn't it? 21 COMMISSIONER LETZ: Right. And what we had looked 22 at when we talked to Mr. Avila several years ago was the 23 property on Hermann Sons Road; it was a lease-purchase where 24 it could be worked into with a portion of the lease payment 25 going towards the purchase price, so it would be -- it could 5-24-10 102 1 be phased in. And, you know, that's another way to get into 2 it without having to come up with a large expenditure. 3 JUDGE TINLEY: So you're just -- it's mostly an 4 information item. That, and seeking consensus of the Court 5 in order to continue to look at properties, review possible 6 sites that may be appropriate, and gather information on and 7 so forth. And -- but when it comes down to specific offers, 8 specific sites, appraisals, et cetera, you'd bring the matter 9 back to the Court? 10 COMMISSIONER LETZ: Yes, sir, I think right now. 11 But I would go out there and actually begin talking to some 12 of the property owners, see if there's an interest, so there 13 would be some -- I just want to make sure the Court was aware 14 of that before Len and myself or Bill, 'cause it could be in 15 Bill's precinct too; just depends. Just east of Center 16 Point. 17 COMMISSIONER OEHLER: I think it's a good idea for 18 y'all to find something down there that would benefit both 19 precincts. 20 COMMISSIONER WILLIAMS: I agree. 21 COMMISSIONER LETZ: And the idea is also that this 22 would be used as a staging yard for a lot of the base 23 material going throughout the county, 'cause most of it's 24 coming from the east, so they need to get it into the county 25 and then distribute it out west so it doesn't all go to 5-24-10 103 1 Kerrville and then go back to the east. 2 COMMISSIONER OEHLER: Yeah. 3 COMMISSIONER LETZ: And paying double freight, like 4 we're doing right now. Okay. So, I don't think we probably 5 needs any action on this. It's just -- I just wanted a 6 clarification, and we'll bring it back once we have a more 7 specific proposition. 8 JUDGE TINLEY: Let me make sure that I haven't 9 missed an item here. 10 COMMISSIONER LETZ: Good, Rob? Rob has questioned 11 whether it should be executive session or not. 12 JUDGE TINLEY: Okay. Okay, let's go to Section 4 13 of the agenda, if we could, please. Payment of the bills. 14 COMMISSIONER LETZ: Move we pay the bills. 15 COMMISSIONER BALDWIN: Second. 16 JUDGE TINLEY: I have a motion and second to pay 17 the bills. Question or discussion on the motion? 18 COMMISSIONER BALDWIN: Now, are we talking about 19 late bills? Are we talking about amended bills? We're 20 talking about bills. 21 JUDGE TINLEY: Just the regular bills. 22 COMMISSIONER WILLIAMS: Just the plain old ordinary 23 bills. 24 COMMISSIONER BALDWIN: This little package here, 25 okay. 5-24-10 104 1 COMMISSIONER WILLIAMS: Plain vanilla bills. 2 COMMISSIONER BALDWIN: Now I don't have any 3 questions. 4 MS. HYDE: Oh. 5 JUDGE TINLEY: I had a question, but I think it's 6 maybe more of a comment. I note on Page 7, prisoner meals 7 shows 12,774 prisoner meals for $4,382. I calculated that 8 out, and that's 34 cents a meal. That's pretty reasonable. 9 COMMISSIONER BALDWIN: Very reasonable. 10 SHERIFF HIERHOLZER: I think it's probably a little 11 bit more than that, Judge. I'd have to look at it. Some of 12 the bills may not have come through all the way yet. But it 13 is -- 14 JUDGE TINLEY: Is it under 50 cents? 15 SHERIFF HIERHOLZER: It's a very good program. 16 It's -- right, yeah. I have to -- I don't have the last 17 bills I approved with me, but it's not bad. 18 JUDGE TINLEY: I think that sends a good message, 19 that it's not such that people want to hang out there and get 20 their three squares there. 21 SHERIFF HIERHOLZER: They will get three squares. 22 It is all dietitian-approved, portion-approved, everything 23 else. It's just not -- it's just -- 24 COMMISSIONER WILLIAMS: Does that apply to the 25 Juvenile Detention Center, where you provide food there as 5-24-10 105 1 well? 2 SHERIFF HIERHOLZER: Sir? 3 COMMISSIONER WILLIAMS: Does that also apply to the 4 Juvenile Detention Facility? 5 SHERIFF HIERHOLZER: On the meals that we do 6 provide for them, yes. 7 COMMISSIONER WILLIAMS: Okay. 8 SHERIFF HIERHOLZER: And that's not all their 9 meals. 10 COMMISSIONER WILLIAMS: I understand. 11 SHERIFF HIERHOLZER: Yeah, it's not lobster and 12 steak and -- you know, but it's a balanced meal. 13 JUDGE TINLEY: Anybody planning on going to the 14 jail, don't think that they're going to really enjoy the 15 culinary feast, huh? 16 SHERIFF HIERHOLZER: Right. 17 COMMISSIONER WILLIAMS: It's not four-star, but 18 it's nutritionally -- 19 SHERIFF HIERHOLZER: It's nutritional. 20 JUDGE TINLEY: Sheriff, let me go to Page 8. 21 SHERIFF HIERHOLZER: Uh-oh. 22 JUDGE TINLEY: There's a rental item to Edward 23 Pollard, $2,000. Is that going to be charged -- I assume 24 that was an execution sale or something along those lines? 25 SHERIFF HIERHOLZER: Yes. That was actually billed 5-24-10 106 1 and reimbursed to the -- well, it was actually billed for the 2 county as part of all that sale of everything we had to do. 3 His bill that he charged us until we could get the equipment 4 out of that building that he had owned was that amount. When 5 the Court awarded the Sheriff's Office the reimbursement for 6 the fees it cost us to actually do it, that was in that, and 7 was reimbursed back to the County. 8 JUDGE TINLEY: Okay. That was carried at cost, 9 then, in that case. That was in -- came back to you off the 10 top of the proceeds? 11 SHERIFF HIERHOLZER: That's correct. 12 JUDGE TINLEY: Okay, good. Thank you. Any other 13 questions or comments about the bills? 14 COMMISSIONER BALDWIN: I would like to make a 15 comment. Throughout the -- throughout the bills, you see 16 that our telephones are still being billed from Windstream, 17 and I think my dear precious friend John is going to make 18 some comments about the status of our telephone system here 19 in just a few minutes. 20 JUDGE TINLEY: Okay, yeah. Any other questions or 21 comments? All in favor of the motion, signify by raising 22 your right hand. 23 (The motion carried by unanimous vote.) 24 JUDGE TINLEY: All opposed, same sign. 25 (No response.) 5-24-10 107 1 JUDGE TINLEY: The motion does carry. Budget 2 amendments. 3 COMMISSIONER BALDWIN: Which one's that? 4 COMMISSIONER OEHLER: That has the yellow stripe 5 down it. 6 JUDGE TINLEY: We have a budget amendment 7 request -- summary request, Numbers 1 through 12. 8 COMMISSIONER BALDWIN: Item Number 3, we're taking 9 from the elected official's salary? 10 MS. HARGIS: That's correct. 11 COMMISSIONER BALDWIN: And putting it into office 12 supplies? 13 MS. HARGIS: That's right. 14 COMMISSIONER OEHLER: That's the time Rex wasn't 15 being paid after he went to -- 16 COMMISSIONER WILLIAMS: He's not taking a cut in 17 pay. 18 COMMISSIONER BALDWIN: He's not taking a cut in 19 pay? I thought, "Golly, what is wrong with this young man?" 20 JUDGE TINLEY: What a guy. 21 COMMISSIONER BALDWIN: Yeah. 22 COMMISSIONER OEHLER: Well, you might ask for that. 23 I'm not sure he's going to be willing -- 24 COMMISSIONER WILLIAMS: Not exactly. 25 SHERIFF HIERHOLZER: I doubt it. 5-24-10 108 1 COMMISSIONER BALDWIN: And then Number 4 and 5, we 2 have overtime in -- in election services. How do you do 3 that? How do you -- there's nobody here. How do you have -- 4 COMMISSIONER WILLIAMS: Does that relate to the 5 city election? 6 COMMISSIONER BALDWIN: -- overtime in elections? 7 MS. HARGIS: Well, we've had, I think, more expense 8 in that area for the different elections than we had 9 budgeted. She -- 10 COMMISSIONER BALDWIN: Really? 11 MS. HARGIS: Mm-hmm. 12 COMMISSIONER BALDWIN: Overtime. 13 MS. PIEPER: The ones working elections, especially 14 on election day, usually work from 6 a.m. till 10 p.m. 15 COMMISSIONER WILLIAMS: Well, for what election are 16 we talking about? We haven't been -- 17 MS. HYDE: Our employees. Our employees. Our 18 election staff. 19 COMMISSIONER WILLIAMS: No, no, no. What election? 20 The city election or the primaries? What are you talking 21 about? 22 MS. HARGIS: I think the primaries. Not -- I think 23 the primaries took a lot of it, and then -- so she ran out 24 when she did. The city's reimbursable, so -- 25 JUDGE TINLEY: Even if this is the city, it's 5-24-10 109 1 charged through here and then we get reimbursed by the City. 2 MS. HARGIS: Keep in mind, this was Diane's first 3 year to work with elections and budget for overtime, so -- 4 JUDGE TINLEY: Any other questions or comments? Do 5 I hear a motion to approve the budget amendment requests as 6 enumerated, 1 through 12 on the summary sheet? 7 COMMISSIONER BALDWIN: So moved. 8 COMMISSIONER WILLIAMS: So moved -- I'll second. 9 JUDGE TINLEY: Motion made and seconded to approve 10 the budget amendment request dated -- or shown as 1 through 11 12 on the summary sheet. Question or discussion? All in 12 favor of the motion, signify by raising your right hand. 13 (The motion carried by unanimous vote.) 14 JUDGE TINLEY: All opposed, same sign. 15 (No response.) 16 JUDGE TINLEY: The motion does carry. Late bills. 17 I guess this is the only one? 18 MS. HARGIS: Yeah. 19 JUDGE TINLEY: On Whelan Plumbing that we had to 20 make the adjustment on? 21 MS. HARGIS: Yes. And you have a credit on there, 22 as you can see. 23 COMMISSIONER LETZ: Move approval. 24 COMMISSIONER BALDWIN: Second. 25 JUDGE TINLEY: Motion made and seconded for 5-24-10 110 1 approval. Question or discussion? All in favor of the 2 motion, signify by raising your right hand. 3 (The motion carried by unanimous vote.) 4 JUDGE TINLEY: All opposed, same sign. 5 (No response.) 6 JUDGE TINLEY: That motion does carry. I've been 7 presented with monthly reports from Justice of the Peace, 8 Precinct 2; Justice of the Peace, Precinct 4; and Constable, 9 Precinct 4, for March and April 2010. Do I hear a motion 10 that those reports be approved as presented? 11 COMMISSIONER OEHLER: So moved. 12 COMMISSIONER LETZ: Second. 13 COMMISSIONER WILLIAMS: Second. 14 JUDGE TINLEY: Motion made and seconded that the 15 indicated reports be approved as presented. Question or 16 discussion? All in favor of the motion, signify by raising 17 your right hand. 18 (The motion carried by unanimous vote.) 19 JUDGE TINLEY: All opposed, same sign. 20 (No response.) 21 JUDGE TINLEY: Motion does carry. Reports from 22 Commissioners in connection with their liaison or committee 23 assignments. Commissioner Oehler? 24 COMMISSIONER OEHLER: Nothing to report. 25 JUDGE TINLEY: Commissioner Baldwin? 5-24-10 111 1 COMMISSIONER BALDWIN: Nothing to report. 2 JUDGE TINLEY: Commissioner Williams? 3 COMMISSIONER WILLIAMS: I just had an e-mail from 4 Mr. Saunders of Branch Water Services, and they are not quite 5 finished with the survey; they're going to be back for two 6 more days this week to complete the data collection. And he 7 extends his thanks and appreciation to Tim and his staff for 8 looking over them and securing the equipment at night and so 9 forth. But that's moving along very well. 10 JUDGE TINLEY: Anything else? 11 COMMISSIONER WILLIAMS: No, sir. 12 JUDGE TINLEY: Commissioner Letz? 13 COMMISSIONER LETZ: Judge, if it's all right, I'll 14 reserve my comments until after the County Attorney. I'll 15 supply a comment after the County Attorney's comment. 16 JUDGE TINLEY: You assume the County Attorney's 17 going to make some comments? 18 COMMISSIONER LETZ: I assume the County Attorney's 19 going to make some comments. If he doesn't, then I don't 20 have any. 21 JUDGE TINLEY: Okay. All right, we will move to 22 reports from elected officials or department heads. Sheriff, 23 I'll let you go -- no, I ought to hold you till last, in case 24 we get close to lunch. 25 COMMISSIONER OEHLER: Better hurry, 'cause I'm 5-24-10 112 1 about out of here. 2 JUDGE TINLEY: Sheriff? 3 SHERIFF HIERHOLZER: Real quick, just a couple 4 things. Statistical-wise, I had to pull up some for the jail 5 for the last year, and I thought it ought to be interesting 6 that from May 1st, 2009 to May 1st, 2010, there was 4,194 7 people booked into the Kerr County Jail. If you look at that 8 compared to the population, you're looking at close to 10 9 percent of Kerr County's population runs through that 10 facility. Of that, 1,190 of those were direct 11 alcohol-related arrests. Not family violence due to alcohol, 12 but direct alcohol-related arrests. That's kind of 13 interesting. And 800 of those were direct drug arrests, and 14 500 were violation of probations. 15 COMMISSIONER WILLIAMS: Ah. 16 SHERIFF HIERHOLZER: Okay. On other news -- and I 17 have to thank John and his crew for once. (Laughter.) Few 18 times -- 19 MS. HYDE: Wow, that's a first. 20 JUDGE TINLEY: Surely you've done some previously. 21 SHERIFF HIERHOLZER: The Sheriff's Office, 22 unfortunately, experienced what I would call the perfect 23 storm that happened out there a few weeks ago in which KPUB 24 had a squirrel get into a power deal that shut off all the 25 power for that portion of town for a short period of time. 5-24-10 113 1 The generator running the jail clicked on, but a lizard got 2 into part of it and blew out the automatic transfer switch, 3 so we did not have automatic transfer of our power onto a 4 generator. And after the dispatch battery backup, which is 5 as big as Walmart's and all the rest of them, runs the 6 emergency power for just the dispatch center, for a total of 7 17 minutes the entire Sheriff's Department went in the dark. 8 Radio, telephones, jail doors, everything. We had zero power 9 at the Sheriff's Office. They -- they were able to get ahold 10 of me, and I got up there and was able to manually switch 11 over to generator to where we got power back up on the 12 generator, but it took about 10 hours to get power back into 13 the jail and the Sheriff's Office, okay? It was a major -- 14 one of those things that you very seldom -- I've only seen 15 total power outage of the Sheriff's Office twice. Once was 16 in this building, and now once has been that one. But the 17 staff did a remarkable job of getting everything going -- 18 jail staff, because when it goes dark in a building without 19 windows, it's like being in the deepest cave; you don't see, 20 you know, a foot in front of your face. 21 COMMISSIONER OEHLER: Don't y'all have a bunch of 22 flashlights? 23 SHERIFF HIERHOLZER: We have a lot of flashlights, 24 but unfortunately, that's always the time, with 160 inmates 25 in there, that inmates want to always scream something 5-24-10 114 1 happened, somebody's hurting, you know, somebody's doing 2 this. You know, it's just -- it's their time -- 3 COMMISSIONER WILLIAMS: Hanky-panky time, huh? 4 SHERIFF HIERHOLZER: -- to mess with the jail 5 staff. But I think the staff did remarkable. And then once 6 you go without power that long, and all your battery back-ups 7 have run down and then power does come on, I don't -- all our 8 weak computers that were, you know, already weak, and John 9 had scheduled for swapping out, he is now having to swap out 10 a lot sooner, because we lost a lot of computer equipment out 11 there when that happened. But I -- and that's why I wanted 12 to thank him and his staff. I know they're still working on 13 issues that we have had over there two weeks ago. 14 MR. TROLINGER: You're welcome, Sheriff. Thanks 15 for mentioning it. 16 SHERIFF HIERHOLZER: A lot of it's not going to -- 17 older stuff that just doesn't come back up all the way. It 18 started to, and certain programs quit. You can ask John 19 about the cost of the insurance on that. 20 MS. HARGIS: I still think we need to apply. 21 SHERIFF HIERHOLZER: It was just one of those 22 things that happened. Our average daily population is still 23 over 160, with females over 20. We're not going down. Thank 24 you. 25 COMMISSIONER WILLIAMS: Any other good news, 5-24-10 115 1 Sheriff? 2 SHERIFF HIERHOLZER: No, not at all. I'll 3 hopefully get a vacation sometime, be out of y'all's hair. 4 JUDGE TINLEY: Things always get better when you're 5 on vacation. 6 SHERIFF HIERHOLZER: I know. 7 JUDGE TINLEY: Mr. Trolinger? 8 MR. TROLINGER: Thanks again, Sheriff. And I'd 9 like to report that the status of the telephone system is 10 good. The new phone system is working well. I feel that 11 we've resolved the majority of the user problems with some 12 individual phones that are still to be replaced, one or two. 13 The actual switch-over of the telephone service from 14 Windstream to Hill Country Telephone is less than 50 percent 15 complete. We have switched the outgoing service, and that -- 16 and that includes the long distance, which is now no 17 additional cost, so the billing problem there is going to 18 drop off pretty quickly. But the incoming lines where we 19 have to switch the actual telephone numbers over from 20 Windstream to Hill Country Telephone is not complete. And we 21 do not have an ETA on that, so there -- there is still 22 billing from Windstream for those lines. I don't have -- 23 COMMISSIONER BALDWIN: How does that work? You 24 know, why hasn't it been done? And -- why hasn't it been 25 done? 5-24-10 116 1 MR. TROLINGER: The -- the service requested from 2 Windstream has not been scheduled by Windstream yet to 3 actually switch those over. 4 COMMISSIONER BALDWIN: They haven't done their 5 little switch? 6 MR. TROLINGER: All the right steps have been taken 7 to get that in place, but Windstream has not scheduled to 8 switch the service yet. 9 COMMISSIONER WILLIAMS: So, Hill Country is not 10 ticking on our incoming and outgoing calls yet, correct? 11 MR. TROLINGER: They are on our outgoing. 12 COMMISSIONER WILLIAMS: They have outgoing, but not 13 the incoming? 14 MR. TROLINGER: Yes, sir. Within a week -- within 15 seven days, Hill Country had run the fiberoptic cable into 16 the courthouse, lit up the line, and provisioned, and we were 17 testing within -- within that -- on that eighth day, we were 18 testing. They've done a great job. They've been very 19 responsive. We had a couple small problems. They fixed 20 those, and we put that thing online just as quickly as -- as 21 we could do after testing. 22 JUDGE TINLEY: My understanding, then, is that -- 23 MR. TROLINGER: So the outcome was good. 24 JUDGE TINLEY: -- we, Kerr County and Hill Country 25 Telephone -- or Hill Country Telecommunications, I think, is 5-24-10 117 1 the name of it, have done everything that we're required to 2 do on our end which leads up to Windstream's actions, but 3 we're merely waiting on Windstream to do their part of it? 4 MR. TROLINGER: Yes, sir. And that's current as of 5 Friday. I spoke with Mr. Marquez, and he assured me that we 6 were simply waiting on Windstream. 7 COMMISSIONER WILLIAMS: Who have you spoken to at 8 Windstream? 9 COMMISSIONER BALDWIN: There's the question. 10 MR. TROLINGER: Good point. 11 COMMISSIONER WILLIAMS: Yeah. 12 MR. TROLINGER: Kimberly Dandurand has been my 13 contact, the sales rep, and I haven't received a response 14 from her yet on that issue. I've received a response this 15 morning on a different issue, but no update from Windstream. 16 COMMISSIONER WILLIAMS: It would perhaps seem 17 logical that since the sales rep lost the account, you might 18 want to go over her head and see if you can find something -- 19 MR. TROLINGER: That's -- and that's where we're 20 at. The actual service request goes all the way to national 21 and bypasses the local completely. So, really, the local 22 personnel don't have any direct input, other than once they 23 receive that request from up top, that they act on it. So, 24 we've gone to the top. 25 COMMISSIONER OEHLER: What you call foot-dragging. 5-24-10 118 1 JUDGE TINLEY: Where is national? 2 MR. TROLINGER: I believe it's in Charlotte, North 3 Carolina. 4 JUDGE TINLEY: Okay. 5 COMMISSIONER WILLIAMS: I thought they were in 6 Arkansas. 7 MR. TROLINGER: They're also in Arkansas, but 8 Charlotte, North Carolina apparently is where the office is 9 that handles the service for us. 10 COMMISSIONER WILLIAMS: Which of these incomplete 11 actions contributes to the lack of audio quality on phones -- 12 some phones in the courthouse? 13 MR. TROLINGER: Now, I understand you had a 14 specific complaint about voicemail, some problems, and we're 15 still looking into that. 16 COMMISSIONER WILLIAMS: I'm asking about a 17 different subject now, not voicemail. 18 MR. TROLINGER: Okay. 19 COMMISSIONER WILLIAMS: Audio quality. 20 MR. TROLINGER: Unless there's a specific extension 21 with a problem, I'm not aware of a system-wide problem. 22 COMMISSIONER WILLIAMS: We'll talk. 23 MR. TROLINGER: Okay. 24 JUDGE TINLEY: In the infamous words of Joan 25 Rivers, "Let's talk." 5-24-10 119 1 COMMISSIONER WILLIAMS: Yeah. 2 MR. TROLINGER: Okay. Well, if there are any 3 problems or questions with the phone system -- and I'll say 4 this. It's a -- it's a big deal taking over the phones. I 5 have a lot of respect for the people that take care of phone 6 systems now. It's like having another computer on every 7 single desk, basically. But if there are any specific 8 requests, we want them -- we want to put them in the help 9 desk, just like we do computer issues, and get them resolved. 10 First thing we have to do is have it in our help desk so we 11 know it's a problem. Thanks. 12 JUDGE TINLEY: Thank you, John. 13 MR. TROLINGER: You're welcome. 14 JUDGE TINLEY: Other elected officials? Department 15 heads? 16 MS. PIEPER: Judge, I have something. 17 JUDGE TINLEY: We're going to get to the County 18 Attorney maybe in a little bit. 19 COMMISSIONER LETZ: Hopefully before the County 20 Attorney has to leave in seven minutes. 21 JUDGE TINLEY: That's right. 22 MS. PIEPER: Senate Bill 1061 required the 23 Commissioners Court to appoint the local advisory board, and 24 which y'all did back on October 26th of 2009. And the local 25 advisory board was required to establish a safety data 5-24-10 120 1 reporting improvement plan and submit it to D.P.S. by June, 2 so I'm reporting that the local advisory board met last week; 3 we got our plan done, so it's going to meet that deadline. 4 That's all I need to let you know. 5 JUDGE TINLEY: I assume you were there. Thank you. 6 COMMISSIONER OEHLER: Thank you. 7 JUDGE TINLEY: Mr. Henneke? 8 MR. HENNEKE: Thank you, Judge. Gentlemen, I want 9 to announce that I've resolved the legal issue with regard to 10 the dispute with the City over the ETJ agreement. I've been 11 working on this issue, and it's a complicated issue. Local 12 Government Code is not one that's necessarily straightforward 13 in all -- all places. But in researching the law and doing 14 my due diligence and conferring with Mr. Hayes at the City, 15 and also with various other legal experts and professionals, 16 the agreement, I guess, to put it -- to put it best, 17 gentlemen, we're not required to enter into an agreement with 18 the City for regulation of the ETJ, and as a consequence, 19 have no requirement to participate in arbitration. So, the 20 legal issue that's been pending out there has been resolved. 21 Now, with regard to the policy issue of still working with 22 the City over joint management of the ETJ and standards, 23 specifically, in the event there's a conflict over which 24 regulation would be the more stringent, and that's certainly 25 something that would be a policy matter to be entered into 5-24-10 121 1 between y'all and the City, but I just wanted to make a 2 report on that as to that -- that pending legal issue that 3 had been going on. 4 JUDGE TINLEY: Thank you. Any -- first, let me 5 ask, any questions for Mr. Henneke? 6 COMMISSIONER WILLIAMS: Well, I wanted to hear what 7 Jonathan said before I asked the question. 8 COMMISSIONER LETZ: Just to follow up a little bit, 9 one, I really appreciate Rob going back to square one and -- 10 and working through the little quagmire of regulations that 11 address this, Chapter 242 and 232, primarily, of the Local 12 Government Code. But -- and what has happened was that when 13 we became a Subchapter C county, that eliminated the 14 requirement to comply with what we thought we had to comply 15 with in Chapter 242. Which we still have some requirements 16 of things we have to require related to -- 242 is what makes 17 cities and counties work together in the ETJ. There still 18 are some requirements that we have to do. Some things kind 19 of don't apply at all. But the part that we had been working 20 on and trying to come up with a blended set of rules or one 21 or the other taking over the ETJ is -- does not apply to us. 22 So, the good news is that we are in compliance with state 23 law, and actually have been in compliance with state law 24 since the County canceled the agreement three years ago. 25 I visited with Todd Parton late Friday on this 5-24-10 122 1 issue, and he and I both -- just ourselves. He had not met 2 with Council, certainly, at that point. You know, we still 3 need to work together. There's still some things we need to 4 try to iron out to make it -- from a development standpoint, 5 make it easier to work in the ETJ, instead of having to go 6 back to where we were originally with developers having to 7 comply with all the city standards and county standards. So, 8 I think we still have some work to do to try to work through 9 that, though it's going to be a different framework than we 10 did previously. And the City Council will be -- this is on 11 their agenda to take -- discuss tomorrow night. They were 12 not aware when they put it on the agenda what the discussion 13 was going to be. It's changed greatly because of what Rob 14 found out, and -- well, actually found out about a week or so 15 ago, 10 days ago, but he confirmed it, I think, on Friday 16 that this interpretation that we had been working under 17 previously was not correct. And that's kind of it in a 18 nutshell. 19 I think the other important point that Rob found 20 out from, I think, Mr. Brook was that the County cannot 21 delegate its authority in the ETJ, so the County has to do 22 the platting. Whether the City can delegate some of their -- 23 you know, delegate their process to us, we don't know yet. 24 That's going to be a decision Mike Hayes is going to have to 25 make looking at it, but we cannot delegate the platting to 5-24-10 123 1 the City. That doesn't mean that we probably -- and I'm 2 going to talk to Rob about this, but I think this came up in 3 discussions. There may be portions of it that we can 4 delegate from the inspection standpoint, some of the working 5 part of it, but the actual approval has to stay at the county 6 level, from our standpoint. 7 COMMISSIONER WILLIAMS: That means we will do the 8 plat reviews. 9 COMMISSIONER LETZ: We have to do the plat reviews. 10 We cannot give that up. And so there is a -- you know, this 11 is a huge change. And hopefully -- you know, I'm glad Rob 12 went through it. There was some -- when all this kind of 13 came to a head in March, it came to a head partially because 14 of a discussion that -- before Rob was in office, when I said 15 there was conflicts between -- I didn't notice this conflict, 16 but there were other conflicts that I noticed between 232, 17 242, and 212, which is the governmental codes. And it was at 18 that meeting it was requested that Mike Hayes look into some 19 of these. And then everything kind of blew up and all 20 discussions stopped at that point. So I'm just glad that 21 we -- you know, Rob was able to go -- you know, took the 22 initiative to go back into looking at the details, look at 23 the law, reading from it square one again and coming up with 24 the resolution, and then really taking the time and getting 25 several other legal minds around the state to confirm that 5-24-10 124 1 this is the correct approach. I think it's really -- I 2 visited with others in Austin, the lobbyist types, and 3 members. They were not aware of this either, 'cause I talked 4 to them about it, and no one -- no one jumped out and told me 5 at all of my discussions I've had at the state level that the 6 -- "Hey, y'all don't have to worry about it; it doesn't apply 7 to you." So, it's kind of a -- it was not an easy thing to 8 find, but it is the correct answer. So, that's it. 9 COMMISSIONER WILLIAMS: Well, I'm glad. I commend 10 Rob for his research and finding this out, and I'm also very 11 pleased to learn that we don't have -- we're not facing the 12 arbitration issue or the possible impediment to the project 13 we got going in east Kerr. So, that's all good news. 14 COMMISSIONER OEHLER: Absolutely. 15 COMMISSIONER LETZ: Yeah. The final thing -- and 16 Rob did mention this on the -- and this is a potential 17 confusing part to the development community that we really 18 need to resolve, is that the stricter standards under 242 is 19 what applies between the city rules and the county rules, and 20 what is stricter is not easy to determine. I mean -- 21 COMMISSIONER OEHLER: There comes the next group. 22 COMMISSIONER WILLIAMS: It depends on the issue. 23 COMMISSIONER LETZ: Yeah. It depends on -- for 24 example, is a 60-foot right-of-way with bar ditches stricter 25 than a 40-foot right-of-way with curb and gutter? I mean, 5-24-10 125 1 there -- it's -- those types of questions still are coming to 2 me, and that's why we need to continue to work with the City 3 of Kerrville to come up with a set of standards at least that 4 we both agree to, and work them into our own set of rules. 5 Anyway -- 6 MR. HENNEKE: Two things, just to follow up 7 briefly. Number one, I think from looking at this 8 legislative framework, it kind of reiterates and reinforces 9 the importance of the model subdivision rules, which are what 10 Kerr County has in place, which makes us a Subchapter C 11 county under section 232 of the Local Government Code, and 12 they've been in place in 2007. And secondly, just to 13 clarify, then, from the issues that we had previously 14 discussed, with my additional research and with this 15 interpretation, there's no need at this point to go forward 16 with an Attorney General opinion, and I just wanted to make 17 sure that -- that there wasn't that expectation any more, 18 because that issue's been resolved on this. 19 COMMISSIONER LETZ: And I think we'll probably -- 20 I'll put it on the agenda next time to formally, you know, 21 undo that last court order so it's not hanging out there 22 about our arbitration or going to the Attorney General. We 23 probably ought to just -- you know, because this is not an 24 action item today. 25 COMMISSIONER OEHLER: Rescind the order. 5-24-10 126 1 COMMISSIONER LETZ: Rescind the order. 2 JUDGE TINLEY: Thank you, Mr. Henneke. We 3 appreciate it. 4 COMMISSIONER BALDWIN: Thank you, Rob. Good job. 5 But, you know, you're talking about 40-foot right-of-way with 6 bar ditches, and as opposed to something else. You can 7 certainly compare 3 inches of base to a requirement of 2 8 inches of base. 9 COMMISSIONER LETZ: Yeah. 10 COMMISSIONER BALDWIN: See, that kind of -- I mean, 11 there's a lot of areas that you can plainly see the 12 difference, and which is more stringent and which is not. 13 COMMISSIONER LETZ: Right. 14 COMMISSIONER BALDWIN: And, of course, we covered 15 all that territory at one time. 16 COMMISSIONER WILLIAMS: Good news. 17 COMMISSIONER BALDWIN: This is for you. 18 COMMISSIONER WILLIAMS: I got one. You can have 19 it. 20 JUDGE TINLEY: Okay. Ms. Hyde? 21 MS. HYDE: This will be quick, 'cause I'm not going 22 to read it to y'all. Y'all can read. I'm just going to ask 23 you to please note some sections in it. Make sure Cheryl 24 gets one. 25 JUDGE TINLEY: This is our homework assignment? 5-24-10 127 1 COMMISSIONER WILLIAMS: You'll give us a test? 2 MS. HYDE: Maybe y'all could start a file with all 3 of these, because I think they will be pertinent to budget 4 when we start talking budgets. On this first one, if you'll 5 look at the very bottom, the very -- the very last bullet, 6 you might -- 7 COMMISSIONER LETZ: You said you weren't going to 8 read it. 9 MS. HYDE: I'm not. You need to mark it. That's 10 the one that really impacts us. 11 COMMISSIONER WILLIAMS: Which one? 12 MS. HYDE: The very last bullet on the very first 13 page. 14 COMMISSIONER OEHLER: Applies to 2012. 15 MS. HYDE: And just put "untrue" next to it, 'cause 16 it continues to change. If you go to the second page, we are 17 major medical; that's the one you would look at. On Page 3, 18 under provisions, unrelated to health coverage, nursing 19 mothers. I'll put that on the agenda next time, after 20 talking to Tim. And then the overview section, the very last 21 one, that one is already changed. The big fat one on the 22 very last page. 23 COMMISSIONER WILLIAMS: Last page? 24 COMMISSIONER LETZ: The one that says medical loss 25 ratios? Oh, no. 5-24-10 128 1 MS. HYDE: The last page before gives you -- yeah, 2 requirement to report value of employment-based health 3 coverage on W-2's. That's already been modified as well. I 4 have to put it on W-2's this year for 2010. 5 COMMISSIONER OEHLER: That's going to be enough to 6 read. I may throw something at you. 7 MS. HYDE: I didn't throw; I just set it down. 8 Judge, you're shaking your head. Yeah, you don't want to 9 read it right now before lunch. 10 COMMISSIONER OEHLER: Please note. 11 MS. HYDE: On this one, first page under 12 background, that very first paragraph, just mark it. 13 COMMISSIONER LETZ: Mark it? 14 MS. HYDE: Mark it. That's the important part of 15 this. 16 COMMISSIONER LETZ: Okay. 17 MS. HYDE: The rest of it, y'all can read, but it's 18 all tax, I.R.S. tax. 19 COMMISSIONER OEHLER: Got another one? Careful. 20 JUDGE TINLEY: Ms. Hyde, if the Court were to pass 21 a court order directing you to staple everything on the top 22 left-hand -- 23 COMMISSIONER OEHLER: Left-hand corner. 24 JUDGE TINLEY: Would that be effective? 25 SHERIFF HIERHOLZER: Probably would be disregarded. 5-24-10 129 1 COMMISSIONER BALDWIN: Let's try it and see. 2 COMMISSIONER WILLIAMS: Let's just go with the 3 suggestion. 4 JUDGE TINLEY: Agenda item. 5 COMMISSIONER BALDWIN: Yeah. 6 MS. HYDE: On this next one, health care reform 7 bill background, please read all of that. Who can 8 participate? That's the second paragraph on the first page. 9 Mark it. That should answer why we discussed a lot about the 10 age limits. And the rest of it, in a nutshell, yeah, there's 11 $3 million out there that people can get, but in the state of 12 Texas, how quick do you think $3 million is going to be taken 13 up? Pretty darned quick. So, that's it on that. That's 14 just for you guys to read, 'cause it will probably change 15 again. Department of Labor web site, I know that 16 Commissioner Williams will probably be asking me where are 17 the updates on COLA. COLA is across the board. It went from 18 less than 1 percent, right at 9 -- .9 to almost a 6, and then 19 it went back down to a 2, so it is across the board, based on 20 what the President is doing. So, I have no clue. And you'll 21 get one -- you'll get one at the end of this month via 22 e-mail. 23 COMMISSIONER WILLIAMS: Right. 24 JUDGE TINLEY: Thank you, ma'am. Any other elected 25 official, department head have anything to lay on us? 5-24-10 130 1 Anything else to come before the Court this morning -- or 2 today? We'll be adjourned. 3 (Commissioners Court adjourned at 12:06 p.m.) 4 - - - - - - - - - - 5 6 7 STATE OF TEXAS | 8 COUNTY OF KERR | 9 The above and foregoing is a true and complete 10 transcription of my stenotype notes taken in my capacity as 11 official reporter for the Commissioners Court of Kerr County, 12 Texas, at the time and place heretofore set forth. 13 DATED at Kerrville, Texas, this 28th day of May, 2010. 14 15 JANNETT PIEPER, Kerr County Clerk 16 BY: _________________________________ Kathy Banik, Deputy County Clerk 17 Certified Shorthand Reporter 18 19 20 21 22 23 24 25 5-24-10