1 1 2 3 KERR COUNTY COMMISSIONERS' COURT 4 Special Session 5 Monday, June 15, 2020 6 9:00 a.m. 7 Commissioners' Courtroom 8 Kerr County Courthouse 9 Kerrville, Texas 78028 10 11 12 13 14 15 16 17 18 19 20 21 22 23 PRESENT: ROB KELLY, Kerr County Judge HARLEY BELEW, Commissioner Precinct 1 24 TOM MOSER, Commissioner Precinct 2 JONATHAN LETZ, Commissioner Precinct 3 25 DON HARRIS, Commissioner Precinct 4 2 1 I-N-D-E-X 2 NO. PAGE 3 *** Commissioners' Comments. 5 4 1.1 Consider, discuss and take appropriate 10 action regarding update, facility use and 5 other matters related to COVID-19. 6 1.2 Consider, discuss and take appropriate 16 action to extend the Local State of 7 Disaster Due to a Public Health and Economic Emergency Proclamation that was 8 signed by Judge Kelly on March 24, 2020, and "extended until terminated by 9 order of the Kerr County Commissioners' Court" on March 30, 2020. 10 1.3 Information regarding the petition campaign 17 11 to get on the November ballot alcoholic beverage sales in Precinct 2. 12 1.4 Consider, discuss and take appropriate 23 13 action to allow County Judge to secure a grant advisor to assist with determining 14 the counties options for spending grant funds related to COVID-19. 15 1.5 Consider, discuss and take appropriate 28 16 action to declare certain county property as surplus in the Human Resources Department. 17 1.6 Consider, discuss and take appropriate 28 18 action to approve a Resolution to apply for the Coronavirus Emergency Supplemental 19 Funding (CESF) Grant through the Alamo Area Council of Governments (AACOG). 20 1.7 Consider, discuss and take appropriate 30 21 action to reappoint Greg Longenbaugh to the Kerr County 9-1-1 Board of Managers. 22 1.8 Consider, discuss and take appropriate 31 23 action to approve the 415 Agreement, Qualified Replacement Benefit Arrangement, 24 for the Texas County and District Retirement System. 25 3 1 I-N-D-E-X 2 NO. PAGE 3 2.1 Pay Bills. 43 4 2.2 Budget Amendments. 43 5 2.4 Auditor Reports. 44 6 2.6 Court Orders. 45 7 3.1 Status reports from Department Heads. 45 8 3.3 Status reports from Liaison Commissioners. 46 9 1.9 Discussion regarding possible refinance 51 of series of Certificates of Obligation, 10 finance options for the FY 2020/2021 capital expenses and possible office 11 building for Regional Public Defender Office. 12 4.4 Deliberation regarding real property as 78 13 per Section 551.072, Government Code. 14 *** Adjournment. 78 15 *** Reporter's Certificate. 79 16 * * * * * * 17 18 19 20 21 22 23 24 25 4 1 JUDGE KELLY: Good morning. It is nine 2 o'clock on Monday, June the 15th, 2020, and the 3 Commissioners' Court is now in session. This is a 4 special session. 5 COMMISSIONER HARRIS: Yes. 6 JUDGE KELLY: Okay. A reminder about cell 7 phones. We're -- we have relaxed our rules on cell 8 phones during this pandemic. So if you would, please 9 put it on buzz or vibrate or something so it doesn't go 10 off. But if it does, I'll forgive you this time. 11 Then the next item on the agenda is Public 12 Input. And let me remind the public that public input 13 is exactly that, It's input. It's where people who want 14 to address the Court on matters that are not on the 15 agenda can come and address the Court. And we are one 16 of the few courts that have public input at all of our 17 special and regular meetings, which I'm proud to say 18 that we do. 19 I'll remind people that when you come, if 20 you want to make comments you're free to do so. If 21 you're here, you will come to the podium. I'll allot 22 three minutes. You'll identify yourself and give your 23 address, we want to know what precinct you live in and 24 know which Commissioner can follow up with you. We'll 25 have a telephone here. You can call, the number is 5 1 (830) 792-6161, and we'll take your call here publicly 2 if you want to call in. I'll remind you that when I say 3 input that's exactly what it is. We don't get to 4 respond to your input. That's the law. Unless you put 5 on there that we're going to discuss it, then we can't 6 discuss it. Is that right? I'm looking at my County 7 Attorney. So we will listen very respectfully and 8 politely, but we can't comment on it. If you want to 9 put it on the agenda, contact your Commissioner or 10 contact me and we can put an item on a future agenda and 11 discuss it. So with that, is there anyone that would 12 like to make a public comment? 13 Okay. Then let's move on to Commissioners' 14 Comments. And just to educate the public, again, this 15 is the opportunity where the Commissioners can report 16 what's going on in their Precinct or in the County. 17 Things that are relevant to County government. And this 18 is really just basically kind of the status report on 19 what's going on in your neck of the woods. So let's 20 start with Commissioner 1, Commissioner Belew. 21 COMMISSIONER BELEW: It's getting very dry 22 out there. 23 JUDGE KELLY: I'm afraid of that. 24 COMMISSIONER BELEW: Yeah. And so, no burn 25 ban for anybody yet, right? 6 1 COMMISSIONER LETZ: Not yet. 2 JUDGE KELLY: Not yet. 3 COMMISSIONER BELEW: Here's the guy we're 4 watching. But it's getting very dry, so keep an eye on 5 it for everybody. 6 JUDGE KELLY: Good. 2. 7 COMMISSIONER MOSER: A couple things. Some 8 of the Precinct 2 folks are pretty upset about a couple 9 things. Number one, and this is probably across the 10 entire County, the appraised value of agricultural 11 exempt land in a lot of cases has gone up 50 percent. 12 And they don't understand why. They haven't had an 13 answer. I don't think the appeals board has met yet. 14 But a lot -- there's going to be a lot of people that 15 are going to be there to make the hearing or at the 16 hearing and understand what's going on. So it's -- it's 17 not understanding. 18 The other thing is -- is the subject of 19 recycle. You know, people get used to doing something, 20 and recycling, and then it's eliminated. And just one 21 of the things that got eliminated from the County are 22 the containers at the landfill. People really like to 23 use them and so when you take something away from 24 somebody that causes some grief, so we've been getting a 25 lot of phone calls about that. 7 1 And another thing just of interest, the 2 Texas Archeological Society was supposed to be here this 3 month with 600 people, they've postponed until next 4 year. Same time, I think. And probably will do it for 5 two years. But I don't think we ever got an official 6 cancellation of that, but it's off. So that's it. 7 JUDGE KELLY: Okay. Good. 3. 8 COMMISSIONER LETZ: Same comments I've heard 9 about the appraised value. People don't understand why 10 they went up so much on the agricultural properties. 11 But hopefully we'll get an answer to that. Other than 12 that, I -- some of the members of the Court know that I 13 traveled this past weekend and went to Louisiana for 14 baseball but -- not that the baseball was good, but 15 what's interesting is that traveling is very challenging 16 these days. For anyone who's planning a trip, looking 17 for restaurants. A lot of restaurants in -- there were 18 very few open in Louisiana. Fast food was there but 19 that was about it. And it's just very -- it's very 20 different than it used to be to go on a road trip 21 somewhere. So I thought it was very interesting. 22 And I guess on a local note, those that try 23 to reach me right now, I'm a little bit hard to catch. 24 I'm on the road quite a bit for the next month. 25 JUDGE KELLY: Good. 4. 8 1 COMMISSIONER HARRIS: All right. I'll chime 2 in with the appraisals. I've had quite a few calls and 3 -- and meeting last week with different individuals. 4 They're all concerned like you say, Tom. And -- and, in 5 fact, there is a group that's planning on getting 6 together and have a meeting this Saturday. And if y'all 7 want information, I'll share it with you afterwards that 8 you might -- I think they're looking for strength in 9 numbers and -- and I encourage it. And I'll be out of 10 town this weekend but I'll share the information with 11 you later. That's all. 12 JUDGE KELLY: Okay. Well, it seems to me 13 that we're hearing a lot about appraisals. And so what 14 I'm going to do is we're going to put this on an agenda, 15 a future agenda, either the 22nd or the 29th, so that 16 the head of the appraisal district -- I can't pronounce 17 her name, Constantinides, something like that. That's 18 as close as I can get. 19 COMMISSIONER LETZ: Sharon. 20 COMMISSIONER MOSER: Sharon. 21 JUDGE KELLY: Sharon. We can't talk about 22 it but I think it's a news worthy thing that we need to 23 -- we need to understand what's going on and I think the 24 public needs to hear her information about what's going 25 on. 9 1 COMMISSIONER HARRIS: Without a doubt. 2 JUDGE KELLY: So we'll put that on the 3 agenda so we can address that publicly then. 4 COMMISSIONER BELEW: And it is worth noting 5 for everybody that we don't have anything to do with the 6 appraisal. 7 JUDGE KELLY: And that -- that's the point 8 that we want to make when we bring Sharon in, is that 9 the County has no control, no authority over the 10 Appraisal District. That's a completely separate 11 function. That is overseen by the Comptroller and the 12 State of Texas. So it has nothing to do with the 13 County, but -- but it affects us and it affects our 14 taxpayers and so we'll have them come in and talk about 15 it. 16 I expect -- I talked with Bob Reeves, our 17 Tax Assessor Collector. We're anticipating to have a 18 higher than average number of ARB hearings, that's 19 Appraisal Review Board. For those of you that want to 20 get into the syntax of County Government, ARB is 21 Appraisal Review Board. And those hearings have to be 22 completed I think -- they have to be completed before we 23 can complete the budget. So I suspect they're going to 24 be very busy between now and August as we complete the 25 budget process. 10 1 COMMISSIONER LETZ: Judge, just a comment. 2 You might visit with Sharon as soon as you can because 3 she may want somebody to come from the Comptroller's 4 Office because I believe that cap rate is set by the 5 Comptroller and not locally. 6 JUDGE KELLY: It is set by the Comptroller, 7 that's a good point. So that may push it at maybe -- 8 close to maybe the 29th to give them time to try to get 9 somebody from the Comptroller's Office in to talk to us. 10 I'm sure they're -- they're talking to everybody across 11 the State. 12 Okay, with that, let's move on to our agenda 13 today, the Consideration Agenda, item 1.1, which has 14 been the first item on our agenda now for three months. 15 Is that right, Dub? 16 MR. THOMAS: 15 weeks. 17 JUDGE KELLY: Consider, discuss and take 18 appropriate action regarding update, facility use and 19 other matters related to COVID-19. Dub Thomas, our 20 Emergency Management Coordinator. 21 MR. THOMAS: Good morning, Judge. Good 22 morning, Commissioners. Yeah, we're in week number 15. 23 Not a whole lot to report this week. I do have some 24 numbers for you. We had no deaths from COVID-19 this 25 past week and we had no positive tests from this past 11 1 week. So that's a good thing. I think that hopefully 2 we're at the bottom of the curve for awhile and I hope 3 we stay there. Testing. We did do some testing this 4 past week. We had mobile testing done by Texas Military 5 Forces at the Doyle Community Center -- the Doyle School 6 Community Center, and we tested 41 people. Still don't 7 have results from those and I still don't have any 8 results back from the testing that we've done the week 9 before either. I know that we had six -- six tests 10 completed and they were all negative and they were still 11 waiting on the rest of those results. So it may be 12 sometime later this week I'll have those results. 13 Let's see. Again, some testing numbers. 14 The COVID positive breakdown again still stayed the 15 same. We had eight by close contact, two by community 16 spread, four travel, seven unknown, for a total of 21 17 COVID positives for Kerr County for the year. 18 Testing for this past week, Peterson 19 Regional at the close of business on Friday had done 20 1,189. Texas Military Forces, 386, that's including the 21 41 from this past Wednesday. 675 in nursing homes. And 22 the 21 COVID positives still gives us an infection rate 23 of .009. 24 JUDGE KELLY: Less than one percent? 25 MR. THOMAS: Less than one percent, yes, 12 1 sir. Significantly less than one percent. 2 JUDGE KELLY: Good job. 3 MR. THOMAS: So I think that -- I think that 4 goes to show that our community is doing a pretty good 5 job as far as social distancing. I've seen a lot of 6 people wearing masks at HEB and some of the other stores 7 around town so I think that's a pretty good thing. 8 Community spread though is still active in 9 Texas. Texas numbers are 86,011 as of yesterday. Total 10 deaths in Texas was 1,957. Total recovered, 56,535. 11 Testing. Total tests is 1.4 million. Of that, the 12 viral test, the one where they do the nasal swab, is 13 actually 1.2 million. The antibody tests, which are the 14 serology test to determine whether or not you've been -- 15 had the virus and just didn't know it, are a 144,050. 16 Kendall County -- surrounding counties, 17 Kendall County is at 36. Medina is 52 with two 18 fatalities. If you'll notice from last week I had 217 19 listed on there for Medina County. What they did is -- 20 if you look at their dashboard, they started including 21 their TDCJ numbers in there. So the Texas -- they do 22 have a prison unit there and so they were adding those 23 numbers in there. So the 52 number comes from the 24 Region 8 -- DSHS Region 8 update; not the State 25 Operation Center's update. 13 1 JUDGE KELLY: So they got almost 250 there 2 in the prison? 3 MR. THOMAS: Pretty close. 4 JUDGE KELLY: I've been in that prison many 5 times. 6 MR. THOMAS: Let's see. Gillespie County is 7 at six. Bandera County is at seven. Kimble County 8 still has one. 235 counties with positive COVID-19 9 cases. Our DSHS Region 8 numbers, of which we are a 10 region -- part of Region 8, active cases are 1,911, 11 3,354 recoveries, 119 deaths. Everything else that you 12 have in the report is the same as it's been for the last 13 15 weeks. 14 We haven't had anymore updates from Governor 15 Abbot on Executive Orders or anything like that. So 16 right now I think we're just -- we need to continue to 17 focus on the positive. And we need to at least stress 18 social distancing, washing your hands, good hygiene, 19 using hand sanitizer if soap's not available, those 20 types of things. 21 COMMISSIONER MOSER: Are we at 75 percent 22 capacity now in restaurants and things? 23 MR. THOMAS: Yes, sir. Yeah, we moved up. 24 June the 3rd is when the Governor put that out so we're 25 up at 75 percent. 14 1 COMMISSIONER MOSER: Okay. Good deal. 2 JUDGE KELLY: Dub, talk to us a little bit 3 about this possible surge. We're hearing the Texas 4 numbers are up a little bit with the openings. I'm not 5 seeing surge numbers here in Kerr County. 6 MR. THOMAS: No, but the -- the surges are 7 going on around the state. The major metropolitan 8 areas, Dallas, Houston, San Antonio, Austin, even Fort 9 Worth, for instance. I think it was expected and -- by 10 the State that once we started opening it up, that 11 people were going to start getting a little bit closer 12 together, they were going to quit using their masks and 13 might relax just a little bit, and I think that's what's 14 caused the surge. 15 JUDGE KELLY: And so as far as our citizens, 16 our taxpayers, we don't want to get too complacent too 17 soon. 18 MR. THOMAS: Absolutely. Yeah, I think -- I 19 think we just -- we need to keep stressing, like I said, 20 social distancing, washing your hands, using face masks, 21 don't go to work if you're sick and, you know, by all 22 means -- we're -- we're doing enough testing around here 23 locally, both free testing from Texas Military Forces 24 and through Peterson Regional. So there's no reason why 25 anybody can't get tested if you feel sick. 15 1 JUDGE KELLY: And the public probably ought 2 to know that the camps are beginning to open up this 3 week. 4 MR. THOMAS: Yes, sir. 5 JUDGE KELLY: I was driving in this morning 6 and I saw at City West Church, they had all the busses 7 lined up to take the kids out to some camp experience 8 somewhere. So that's something we need to be very 9 careful about. Because the counselors come in from all 10 over the country and then you have kids. They've got a 11 good -- American Camping's Organization has a good 12 protocol for the kids, using all paper goods and keep 13 them social distance and such, but they're kids. I 14 mean, you can only keep kids apart so long. But that's 15 -- that's going to be the thing to watch in your 16 community over the next few weeks is opening up the 17 camps. 18 And then remind everyone that we don't open 19 up for actual jury selection at this courthouse, when we 20 actually get a lot of people together, and that will 21 open up August 1. So we still have a couple other 22 benchmarks that we're trying to get past and so far, 23 with the infection rate of less than one percent and 24 limited to 21 COVID positive cases and we only have two 25 active, is that right? 16 1 MR. THOMAS: Yes, sir. Two actives. And I 2 expect one, if not both of those, to come off this week. 3 JUDGE KELLY: And I compliment you and the 4 people that you're working with, City and others. 5 You've done a very good job. 6 MR. THOMAS: Thank you, sir. 7 JUDGE KELLY: Okay. Anything else for Dub? 8 Okay. Always good to see you. 9 MR. THOMAS: Thank you. Maybe next time 10 it'll be under different circumstances. 11 COMMISSIONER BELEW: Well, we look forward 12 to week 16. You're always number one on our list. 13 MR. THOMAS: Okay. Easy. Easy. 14 JUDGE KELLY: Well, as long as we keep 15 getting good reports, what more can we ask? 16 The next item on the agenda we deal with 17 every week now. This will be our, what, 15th week on 18 this one, too? 1.2 consider, discuss and take 19 appropriate action regarding the Local State of Disaster 20 Due to a Public Health and Economic Emergency 21 Proclamation that I signed on March the 24th, and 22 extended until terminated by further order of this Court 23 on March the 30th. 24 So we review this every week. And on advice 25 of counsel, we've kept that Proclamation in place for 17 1 reimbursement and grant purposes. As you can see, we've 2 done -- we've done very well. So anybody want to weigh 3 in on this one today? We put it on the agenda every 4 week. 5 That order is -- the Proclamation, by the 6 way, is only good for seven days unless it's renewed on 7 a weekly basis and that's why it's on the agenda. 8 COMMISSIONER MOSER: No reason to take it 9 off. 10 JUDGE KELLY: Okay. Then let's move on to 11 item 1.3 information regarding the petition campaign to 12 get on the November ballot for the alcoholic beverage 13 sales in Precinct 2. Claudia Richards. 14 MS. RICHARDS: Good morning, Judge. 15 JUDGE KELLY: Good morning. 16 MS. RICHARDS: As most of you know, my name 17 is Claudia Richards. I am the Program Director for 18 Precinct 2 Prosperity Program. Our mission is to 19 legalize the sale of all alcoholic beverages in 20 Precinct 2 for the sales tax benefit, especially during 21 this economic crisis that we're in. 22 I wanted to speak today to let you know -- 23 give kind of an update on where we are. We will be -- 24 we're doing a lot of live and media networking this 25 week. We'll be on -- with the KEDC, Teresa Metcalf, who 18 1 is here also, she will be hosting a broadcast on 2 Wednesday -- begin broadcasting on Thursday. 3 I want to say thank you to the Comanche 4 Trace, especially the Lady Niners. They were absolutely 5 awesome in the drive that they held last week. They got 6 over 150 signatures alone with just what they did in a 7 four-hour period. 8 This week, we -- from the 18th to the 20th, 9 the Story is at -- the Elephant Story will have a 10 drive-thru complimentary wine and cheese tasting. So 11 you can drive thru and sign the petition, sample some 12 great wine or get some great cheese. That will be from 13 the 18th to the 20th, from 10:00 a.m. to 5:00 p.m. 14 COMMISSIONER MOSER: Repeat that location 15 again. 16 MS. RICHARDS: Elephant Story. It's 17 actually located in Comfort. 18 COMMISSIONER MOSER: Okay. 19 MS. RICHARDS: But it's -- it's the Elephant 20 Story. They are also hosting Zanzenberg Storyville in 21 Center Point. And that's directly across the street 22 from the post office on Main Street in Center Point. 23 They will be there on Friday from 4:00 to 6:00, Saturday 24 from 12:00 to 3:00. Same concept, complimentary wine 25 and cheese tasting. 19 1 Commissioner Harris, you mentioned strength 2 in numbers, and I think that that is extremely 3 important, especially with what we're doing right now. 4 We have -- the area that we're working with is such a 5 vast rural area with very few densely populated 6 communities, such as River Hills and Comanche Trace, 7 which are our -- our largest target points, but it's 8 been very rewarding and encouraging to work with 9 everyone in such a diverse population with -- you know, 10 we have such a diverse population out there and everyone 11 has worked phenomenally together and in the middle of a 12 pandemic and the civil unrest that is happening right 13 now. It's been -- it's been really encouraging. 14 So I want to say thank you to the community, 15 thank you to the precinct voters, the registered voters 16 who have gotten out there. And Judge, thank you for 17 last week emphasizing the necessity of it. That was 18 very helpful. 19 As of now, we have 646 valid signatures to 20 submit. So that's where we stand on numbers. 21 JUDGE KELLY: And my understanding, how many 22 -- what's the number we need? 23 MS. RICHARDS: 2,016 by the end of August -- 24 or by the end of July. 25 COMMISSIONER MOSER: Easy way to remember, 20 1 just remember 2020. 2 JUDGE KELLY: 2020. Okay. 3 COMMISSIONER MOSER: 2020, that gets it. 4 JUDGE KELLY: And Ms. Richards, just to 5 clarify. One of the major reasons that we're doing this 6 is to develop the craft agriculture along Highway 27 7 East and Highway 173 South. 8 MS. RICHARDS: Absolutely. 9 JUDGE KELLY: Which are in Precinct 2 -- 10 MS. RICHARDS: Absolutely. 11 JUDGE KELLY: -- in order to be able to 12 develop wineries or local breweries or what have you 13 like has been done in Fredericksburg, we'll need to have 14 that precinct be wet instead of dry. 15 MS. RICHARDS: Correct. And -- 16 JUDGE KELLY: That's one of the major 17 reasons. 18 MS. RICHARDS: Absolutely. And some members 19 of the community have said that they don't want this to 20 become a wine trail. However, if we do open that area 21 up, it will also bring in further retail shops and sales 22 venues and more restaurants. So it won't -- it is not 23 specific to just trying to get alcohol sales. 24 JUDGE KELLY: Well, I think -- I think most 25 of us would much rather see that land developed for 21 1 craft agriculture rather than quarries. 2 MS. RICHARDS: Absolutely. 3 COMMISSIONER MOSER: Correct. 4 MS. RICHARDS: And that's all I've got on 5 that. 6 JUDGE KELLY: Thank you very much. 7 COMMISSIONER MOSER: So 646 to date -- 8 MS. RICHARDS: Correct. 9 COMMISSIONER MOSER: -- signatures. So by 10 the end of -- and it has to be completed, essentially, 11 by the 1st of August? 12 MS. RICHARDS: Correct. 13 COMMISSIONER MOSER: So you've got 60 days. 14 So we may have to go to Plan B if at the end of June 15 we're -- we're not sufficiently there, because probably 16 getting a full hanging approved right now. So may have 17 to try to go door-to-door or something like that, even 18 though people are probably going to resist that. 19 MS. RICHARDS: We will not be going door to 20 door. 21 COMMISSIONER MOSER: Okay. 22 MS. RICHARDS: We will improvise and do what 23 we need to do, but as Mr. Thomas just said, COVID is 24 still -- is still rampant and it is still -- we -- we 25 have been lucky and blessed due to County decisions that 22 1 y'all have made, and keeping social distancing in place, 2 but we will not be going door to door. I think the 646 3 with the first two weeks in, we were hoping to have 4 relief and so trying to market a plan, almost 5 immediately, which was completely different from the 6 plan that we had before, has been challenging. However, 7 the events that we have coming up I think are going to 8 be extremely successful. 9 COMMISSIONER MOSER: Claudia, for all the 10 places that you mentioned where people can sign the 11 petition are -- is in Comfort or Center Point. Are 12 those locations, times, and dates available on a 13 website? 14 MS. RICHARDS: They are. You can find them 15 at Precinct 2 Prosperity dot com. 16 COMMISSIONER MOSER: Precinct 2 Prosperity 17 dot com. Okay. 18 MS. RICHARDS: Correct. And you -- forward 19 slash events or there's also an events tab or an 20 affiliate tab and the petitions are located there at all 21 times, not only during the event signings. 22 COMMISSIONER MOSER: Okay. Good. So I know 23 at -- at Center Point, it's every Friday and every 24 Saturday. 25 MS. RICHARDS: Correct. 23 1 COMMISSIONER MOSER: For three hours on 2 Friday and three hours on Saturday. 3 MS. RICHARDS: Right. 4 COMMISSIONER MOSER: So there's a lot of 5 opportunity for people to sign if they'll just take the 6 time to sign. 7 MS. RICHARDS: But even though they're only 8 there on those days, Los Dos Amigos as well as Tucan 9 Jim's and La Tapatia have copies of the petition as 10 well. 11 COMMISSIONER MOSER: Okay. Good. Thanks, 12 Claudia. 13 JUDGE KELLY: Thanks for your good work. 14 MS. RICHARDS: Thank you. 15 JUDGE KELLY: Okay. Item 1.4 on the agenda, 16 which is consider, discuss and take appropriate action 17 to allow the County Judge to secure a grant advisor to 18 assist with determining the counties options for 19 spending grant funds relating to COVID-19. 20 I put this down for James Robles. Go ahead 21 and sit down, James. That was just if something's 22 unpopular I wanted to blame it on him. 23 This is something that I put on the agenda. 24 And what this is, is for those of you that have not paid 25 attention, the Federal Government has allotted $55 per 24 1 citizen in counties and that has amounted to 1.4 million 2 dollar allocation of a possible grant to the County, 3 Kerr County. And that is for reimbursement for expenses 4 related to COVID-19. 5 In that legislation, they allow up to five 6 percent of what they have awarded of the 1.4 to hire a 7 consultant to advise us on what we can be reimbursed for 8 so that we -- we take advantage, full advantage, of what 9 they're offering to try to help us with. And so it's 10 not often that we get this kind of offer from the 11 Federal Government so I'd like to take advantage of 12 that. And since that is an expense that they allow and 13 at this point we're no where close to $1.4 million, 14 right, Sheriff? 15 So we need -- it would be good for us to 16 have somebody, like the equivalent of a CPA or a tax 17 lawyer that comes in there and takes a look at your -- 18 your information and see what qualifies, and that -- if 19 that is allowed, so that would be a reimbursable expense 20 for us to do, so it would cost us nothing to do. The 21 Federal Government is providing this to try to help us 22 help ourselves and combat this COVID-19. 23 So that's why I put it on the agenda. And 24 so what I'm asking from the Court is to allow us to go 25 ahead and interview consultants and bring somebody to 25 1 the Court to be approved and try to manage these funds 2 and maximize our reimbursements as allowed. 3 COMMISSIONER BELEW: Is this something that 4 will reach a level where we have to have a bid 5 submission or -- 6 JUDGE KELLY: No. 7 COMMISSIONER BELEW: -- or it's just 8 services? 9 JUDGE KELLY: Well, it's just services. 10 COMMISSIONER BELEW: Okay. 11 JUDGE KELLY: I think that's right. County 12 Attorney? 13 MRS. STEBBINS: Professional services. 14 COMMISSIONER BELEW: Professional services 15 up to -- 16 JUDGE KELLY: Well, if -- if you did the 17 five percent we've got in the budget that the Federal 18 Government's given us, up to $70,000. But I don't 19 anticipate we're going to come anywhere close to 20 spending that. You know, but if we go spend five or 21 $10,000.00 to get some good advice on what is 22 reimbursable, I think that would be prudent. 23 COMMISSIONER MOSER: And the City is 24 planning on doing this? 25 JUDGE KELLY: The City's already got 26 1 somebody. 2 COMMISSIONER MOSER: Oh, do they? 3 JUDGE KELLY: Yeah. 4 COMMISSIONER MOSER: In the way of -- it's 5 only enforceable with the City and -- 6 JUDGE KELLY: We -- we've talked with the 7 City. We've talked with our auditors for their 8 recommendation. I've spoken with a couple of my fellow 9 county judges who are -- what we're trying to do at a 10 regional level, and this is -- you know, we're building 11 off of other ideas. We've got the regional public 12 defender's office, so the five of us have been talking 13 about can we find a consultant to help the five of us 14 because, you know, we're -- our economies are 15 intertwined anyway. 16 COMMISSIONER MOSER: Yeah. For other 17 counties it seemed like it would be similar expenses 18 that could be reimbursed. 19 JUDGE KELLY: So we're just -- at this point 20 we're just looking for authorization to shop and 21 interview people and bring somebody back to you and tell 22 you what they recommend. 23 COMMISSIONER BELEW: Now, is this going to 24 be somebody that can consult on it and then write the 25 grant application? 27 1 JUDGE KELLY: We'll write the grant 2 application here on E-grants. Don't ask me too much 3 about that. 4 COMMISSIONER BELEW: But they say -- 5 JUDGE KELLY: They do have me sign these 6 grants. 7 COMMISSIONER BELEW: Yeah. But they're 8 going to look over our shoulder while we do it? 9 JUDGE KELLY: They will assist us, yes. 10 COMMISSIONER BELEW: Yeah. 11 COMMISSIONER LETZ: I'll make a motion that 12 we authorize the County Judge to secure a grant advisor 13 to assist with the COVID-19 related expenses that may be 14 eligible under the Federal grant, and request that a 15 consultant -- I'm sure there will be -- but the County 16 Auditor on the selection process. 17 COMMISSIONER BELEW: Second. 18 JUDGE KELLY: Motion's been made by 19 Commissioner Letz, seconded by Commissioner Belew for us 20 to secure a grant advisor to assist in determining the 21 County's options to spending grant funds related to 22 COVID-19. Any other discussion or debate? 23 COMMISSIONER BELEW: Thank you, James. 24 JUDGE KELLY: Well, and I've been working -- 25 the reason James got on there is because Tanya and James 28 1 have been working with me on this. Okay. 2 Then those in favor raise your hand. 3 Unanimous, five zero. Good. 4 1.5. Consider, discuss and take appropriate 5 action to declare certain County property as surplus in 6 the Human Resources Department? 7 MR. ROBLES: Yes. You have a list of the 8 items. We have four items -- actually five. There's 9 cabinet shelving that are no longer usable and we're 10 requesting that those be declared surplus. 11 COMMISSIONER BELEW: I move for approval. 12 COMMISSIONER LETZ: Second. 13 JUDGE KELLY: Motion's been made by 14 Commissioner Belew, seconded by Commissioner Letz to 15 approve the surplus items as presented. Any further 16 discussion? Those in favor raise your hand. Unanimous, 17 five zero. 18 1.6 consider, discuss and take appropriate 19 action to approve a Resolution to apply for the 20 Coronavirus Emergency Supplemental Funding Grant through 21 the Alamo Area Council of Governments. I don't see 22 Callie here today, but James is here. 23 MR. ROBLES: I'll take it for her. This is 24 going to be a separate grant unrelated to the 1.45 25 million we were just discussing. This is a 30,000 grant 29 1 through AACOG. This will help us with our COVID 2 expenses, cleaning, and also straight time for officers. 3 The application is due today and we're requesting that 4 we get that Resolution approved. 5 COMMISSIONER MOSER: James, a question. 6 This is in addition to the 1.4 million? 7 MR. ROBLES: Yes, sir. 8 COMMISSIONER MOSER: So where does this 9 funding come from? 10 MR. ROBLES: This one comes from AACOG. 11 COMMISSIONER MOSER: Okay. Move for 12 approval. 13 COMMISSIONER LETZ: Second. 14 JUDGE KELLY: Motion's been made by 15 Commissioner Moser, seconded by Commissioner Letz to 16 apply for the AACOG grant. Any other discussion or 17 debate? 18 COMMISSIONER MOSER: And approve a 19 Resolution. 20 JUDGE KELLY: And approve a Resolution. 21 COMMISSIONER BELEW: I'd like a -- kind of a 22 refresher on the -- what the County Auditor said last 23 meeting. We have -- we got already $240,000? 24 MR. ROBLES: Yes. We received 20 percent of 25 the 1.45 million of the fund. 30 1 COMMISSIONER BELEW: So we already have 2 that. 3 JUDGE KELLY: It was actually $291,000. 4 MR. ROBLES: 291,000. 5 COMMISSIONER BELEW: 291,000. Okay. All 6 right. I had remembered 240 for some reason. 291. And 7 that's separate also? That's back of that 1.4 million? 8 MR. ROBLES: Correct. 9 COMMISSIONER BELEW: Okay. All right. 10 That's all. 11 JUDGE KELLY: And so we've got a motion, is 12 that right? 13 COMMISSIONER MOSER: Uh-huh. 14 COMMISSIONER BELEW: Second. 15 JUDGE KELLY: Motion's been made by 16 Commissioner Moser, seconded by Commissioner Belew to 17 apply for the AACOG grant. Any further discussion or 18 debate? Those in favor raise your hand. Unanimous, 19 five zero. 20 Let's move on to 1.7 consider, discuss and 21 take appropriate action to reappoint Greg Longenbaugh to 22 the Kerr County 9-1-1 Board of Managers. Commissioner 23 Moser. 24 COMMISSIONER MOSER: Thank you, Judge. I 25 make a motion that we approve Greg Longenbaugh. Okay. 31 1 He's been on the Board and he's a Deputy Sheriff. That 2 Board is working very, very efficiently and effectively, 3 so he agreed to serve another term. So I make that 4 motion. 5 COMMISSIONER HARRIS: Second. 6 COMMISSIONER BELEW: Second. 7 JUDGE KELLY: Okay. Motion's been made by 8 Commissioner Moser, seconded by Commissioner Harris to 9 reappoint Greg Longenbaugh to the Kerr County 9-1-1 10 Board of Managers. Is there any further discussion or 11 debate? Those in favor raise your hand. Unanimous, 12 five zero. 13 Item 1.8 consider, discuss and take 14 appropriate action to approve the 415 Agreement, which 15 is a Qualified Replacement Benefit Arrangement, for the 16 Texas County and District Retirement System. Jennifer 17 Doss. 18 MS. DOSS: Good morning, Judge and 19 Commissioners. This came to light recently with the -- 20 we were notified by TCDRS, the Texas County District 21 Retirement System, that we have an active employee who, 22 if retired today, their monthly retirement payment would 23 exceed the amount allowed by IRS regulations. 24 Now, the TCDRS does monthly calculations 25 based on your length of service and your age and amount 32 1 of retirement figures. This individual, the salary has 2 been a high level and they've been here for many years. 3 The chances of this person retiring right now, you know, 4 is probably not going to happen, but this -- apparently 5 this has never happened in Kerr County before, so TCDRS 6 is -- they had to notify us that this is a possibility. 7 When this happens, what the 415 Agreement 8 allows is for the -- for Kerr County to pay the 9 difference. Now, the monies that Kerr County pays will 10 be deducted from the monthly contributions that we sent 11 in and we send in for the employees. 12 Apparently, there's only one other Texas 13 county that actually has an employee that has retired 14 that makes these payments. There are several other 15 counties who are in this situation. And when this 16 happens, what I understand from TCDRS is that counties 17 put this 415 in place. And the good news is that you 18 only have to do this once. This will be in place for 19 any future employees that fall into this situation. 20 Now, as an employee ages, so does the limit. 21 So they gave me an example of somebody that's age 50 22 that retires, the limit that they can make or that TCDRS 23 can pay them in retirement is a hundred thousand. When 24 they reach 55, it goes up to 145. Once they reach 60, 25 it's 200,000. And 62 plus, it's 230,000. And so the 33 1 way it was explained to me, that typically if a person 2 retires TCDRS will make the payments from January to 3 October, November. Typically, it's just what the County 4 would pay would be a small amount. And then we pay the 5 remainder of the year. So we pay this through payables. 6 We issue them a 1099, and as that retiree ages, so does 7 the limit. And so probably within a year or two, these 8 amounts increase so much that -- that we wouldn't need 9 to make the difference anymore. 10 COMMISSIONER LETZ: It's confusing but 11 there's a limit under our TCDRS program and that the 12 County's -- it's just the way they set up the program 13 and -- part of it. If there's -- the amount is in 14 excess, the counties have to pick up the difference for 15 a period of time. The employee is entitled to the 16 retirement. 17 MS. DOSS: Right. 18 COMMISSIONER LETZ: It's just the retirement 19 plan doesn't get to that point because of IRS 20 limitations; therefore, the County has to pick it up 21 until the -- you know. 22 JUDGE KELLY: Can't they just max out on the 23 benefit? 24 COMMISSIONER LETZ: But they're -- the 25 employee is entitled to the retirement at a higher level 34 1 than the IRS allows. 2 JUDGE KELLY: I understand that. 3 COMMISSIONER LETZ: Yeah. And it's that -- 4 we -- the counties have to pay the difference, if it 5 happens, which is evidently very rarely in a given 6 situation, you know, for a couple years, until the IRS 7 limit exceeds the limit that the person -- that the 8 employee is entitled to. 9 COMMISSIONER BELEW: So I didn't understand 10 the last part of that, Jennifer. You said that it goes 11 away after a couple of years, in this particular case -- 12 MS. DOSS: Correct. They said if an 13 employee -- 14 COMMISSIONER BELEW: -- right? 15 MS. DOSS: -- retires at 50, it -- 16 incrementally the amount allowed by IRS grows. So by 17 the time they reach 52 or -- they might fall under the 18 -- whatever that limit is. And so for the years that 19 they're under the limit -- excuse me, for the years that 20 they're over the limit, that's the only years that we 21 would need to pay. Once they reach a certain age, the 22 TCDRS amount goes up. TCDRS will pay the entire -- 23 COMMISSIONER BELEW: So it's a time factor? 24 MS. DOSS: Yeah. 25 COMMISSIONER BELEW: At that point it's a 35 1 time factor and not an amount factor? 2 MS. DOSS: If they -- it's their age. It's 3 -- the amount increases with age. 4 COMMISSIONER LETZ: As their age increases, 5 the IRS limitation increases. 6 COMMISSIONER MOSER: What -- what is the IRS 7 limitation? That's the thing I don't understand. 8 MS. DOSS: Apparently, I -- I asked if there 9 was a formula and they said it's not that easy. It's 10 complicated. 11 COMMISSIONER MOSER: Well, why -- why is the 12 federal government limiting the retirement from a state 13 employee? Is that -- unless there's something -- it's 14 probably just my -- 15 COMMISSIONER LETZ: Oh, I don't -- I don't 16 understand -- 17 MS. DOSS: Well, like, you know -- 18 COMMISSIONER LETZ: -- why there's an IRS 19 limit, I don't know, but -- 20 COMMISSIONER HARRIS: I got the same 21 question. I don't -- you know -- 22 MS. DOSS: Right. Well, like Commissioner 23 Letz said that, you know, the employee is entitled -- 24 the retiree is entitled to the -- a hundred percent of 25 the pay, it's just that TCDRS is only allowed to pay up 36 1 to a certain point. 2 COMMISSIONER MOSER: Based on the IRS. 3 MS. DOSS: Right. And so -- 4 COMMISSIONER MOSER: But still -- 5 MS. DOSS: -- so they'll technically be 6 paying the whole because they'll -- they'll reduce our 7 monthly contribution by whatever that amount is. 8 COMMISSIONER MOSER: Yeah, I -- I understand 9 all that. I understand. I'm just asking about the IRS 10 limitation. That's the part I -- 11 JUDGE KELLY: Explain that last part again. 12 I didn't understand that. 13 MS. DOSS: So whatever amount Kerr County 14 pays out to this individual -- 15 JUDGE KELLY: Let's just say we pay out 16 $10,000.00, what happens? 17 MS. DOSS: Right. So the next monthly 18 contribution you'll -- our payments -- from the regular 19 employees, their contributions and our matching, that 20 bill will be reduced by $10,000.00. We'll submit the 21 whole amount but they'll draft $10,000.00. So, in 22 essence, they're making the payment for us but it's not 23 coming directly from them. It is confusing. 24 JUDGE KELLY: So what we're doing with this 25 is circumventing the IRS limitation. And TCDRS is 37 1 actually the one indirectly paying them? 2 MS. DOSS: Correct. 3 JUDGE KELLY: So this is -- 4 MS. DOSS: But you have to have this 5 agreement in place in order to be able to do that. 6 JUDGE KELLY: There's something about this 7 that just doesn't sound right. I don't know what it is. 8 COMMISSIONER BELEW: Well, it -- it doesn't 9 sound right, but it's legal. 10 COMMISSIONER LETZ: I think it's where the 11 -- the reason that works also is that there's -- and I'm 12 guessing on this after looking at that program, they 13 have some excess funds in the -- in -- Kerr County's 14 account has some excess funds in it, above and beyond, 15 because of -- the -- the fund grows. And that excess 16 funds is what's actually making this payment. But it 17 has to go through a roundabout way to get there. 18 COMMISSIONER MOSER: All determined by or 19 dictated by IRS -- 20 COMMISSIONER LETZ: IRS. 21 COMMISSIONER MOSER: -- because none of us 22 understand why there's an IRS limitation. 23 COMMISSIONER LETZ: And I'm sure that the 24 limitation is -- I mean, again, I'm guessing -- it's 25 similar to -- the logic, I would think would be to 38 1 prevent municipalities and local governments from paying 2 real high salaries, and then having retirements. 3 COMMISSIONER MOSER: Okay. 4 COMMISSIONER LETZ: You know, who knows that 5 part of it, I'm just guessing. But it's something -- 6 it's similar to this -- you know, it's graduated taxes. 7 You make over a certain amount, you're at one rate. If 8 you're -- it's the same type logic, I think. 9 COMMISSIONER MOSER: So bottom line is 10 assuming that the IRS limitations are there, which I'm 11 sure they are, then there's -- there's -- we've got the 12 decision here -- 13 MS. DOSS: Right. 14 COMMISSIONER LETZ: And we have to do this. 15 Well, the other option is we can not do the agreement 16 and then the money comes out of our general fund, 17 because we're obligated to the employee. 18 MS. DOSS: Right. 19 COMMISSIONER HARRIS: Well, there's -- so it 20 wouldn't cost us anymore in the long run. 21 MS. DOSS: Correct. Correct. 22 COMMISSIONER HARRIS: It won't cost the 23 County any extra. 24 MS. DOSS: Any amount we pay out, they'll 25 reduce our monthly by the same. 39 1 COMMISSIONER HARRIS: Gotcha. 2 COMMISSIONER LETZ: But if we don't do it, 3 it does cost us more. 4 COMMISSIONER HARRIS: Okay. 5 MS. DOSS: And the County Attorney has 6 reviewed the contract, the agreement and -- 7 MRS. STEBBINS: (Shaking head in affirmative 8 manner.) 9 MS. DOSS: -- she gave us her blessings. 10 COMMISSIONER BELEW: So there's no cost to 11 the County for this? 12 MS. DOSS: No. 13 COMMISSIONER BELEW: There's no service 14 charge? 15 MS. DOSS: No. No. 16 COMMISSIONER MOSER: I make a motion that we 17 approve the 415 Agreement for the Texas County and 18 District Retirement System. 19 COMMISSIONER HARRIS: Second. 20 JUDGE KELLY: Motion's been made by 21 Commissioner Moser, seconded by Commissioner Harris to 22 approve the 415 Agreement, the Qualified Replacement 23 Benefit Arrangement, to the Texas County and District 24 Retirement System. Debate and discussion? 25 COMMISSIONER LETZ: That discussion was 40 1 better than I really anticipated. 2 COMMISSIONER BELEW: Well, I agree with you, 3 Judge. It doesn't sound right and it certainly doesn't 4 make any sense to me. It sounds like a way around 5 something that's been allowed. 6 JUDGE KELLY: And it may very well be that 7 this is what we need to do. But where I'm coming from 8 is, I just don't think it's a good practice to rush to 9 vote for something that we don't understand. 10 MS. DOSS: Well, the TCDRS did say that if 11 you have any questions -- if the Court has any 12 questions, they can call in and explain it and you each 13 can call them and -- 14 JUDGE KELLY: My preference would be is put 15 this back on the agenda and get that explanation from 16 TCDRS so that we know exactly what we're doing. I don't 17 want to vote -- I'm not against it. I'm just saying I 18 don't want to vote for something that I don't 19 understand. I don't think -- I don't think that's what 20 I'm supposed to do. 21 COMMISSIONER HARRIS: But is our County 22 Attorney -- she's reviewed it and you're comfortable 23 with it? 24 MRS. STEBBINS: I reviewed the legality -- 25 JUDGE KELLY: The legality of it. 41 1 MRS. STEBBINS: -- of it. Yes. 2 JUDGE KELLY: Okay. 3 MRS. STEBBINS: Now, I don't -- well, like 4 the County Judge -- 5 JUDGE KELLY: But to understand the policy 6 behind it, I'd like the TCDRS to explain it to us. 7 MS. DOSS: Okay. 8 JUDGE KELLY: I'm not faulting you. I'm 9 just saying -- 10 MS. DOSS: Okay. It is very complicated. 11 JUDGE KELLY: -- let's go to the next pay 12 grade up and say, come explain this to us because this 13 is getting in deep water. 14 COMMISSIONER BELEW: I agree with that. 15 COMMISSIONER LETZ: So basically we need an 16 explanation of the IRS limitations. 17 COMMISSIONER MOSER: Yeah. And I think we 18 start with -- and that's the same -- I said assuming 19 that the IRS limitation is there, which I'm sure it is, 20 then you can go forward. But it's okay to start with 21 the IRS limitation. I'd like to understand it better. 22 It's -- it's a surprise to me for such a limitation. 23 COMMISSIONER HARRIS: And there's no time -- 24 I mean, are we under the gun to get this done in a 25 certain time? 42 1 MS. DOSS: No. If -- if the individual were 2 to retire today -- 3 COMMISSIONER HARRIS: Right. 4 MS. DOSS: -- we wouldn't have -- 5 COMMISSIONER MOSER: Okay, all right. I 6 withdraw my motion. 7 COMMISSIONER HARRIS: I'll withdraw my 8 second. 9 JUDGE KELLY: Okay. So just so the public 10 understands, we don't understand so we're going to look 11 at this some more. That's where we're going. 12 MS. DOSS: Okay. So do we have them call 13 in, say, the next week? 14 JUDGE KELLY: We'll put it on -- we'll put 15 it back on the agenda. 16 MS. DOSS: Okay. Thank you. 17 COMMISSIONER LETZ: As a timed item. 18 JUDGE KELLY: We'll do this again. We'll 19 put it as a timed item so they'll know exactly what time 20 we're going to call in -- or they can call in. 21 MS. DOSS: All right. 22 COMMISSIONER MOSER: Thanks, Jennifer. 23 MS. DOSS: Thank you. 24 JUDGE KELLY: Okay. The only other thing we 25 have on the consideration agenda is a timed item, which 43 1 is probably going to be discussed in Executive Session 2 at 10:30. 3 So let's move on to the Approval Agenda. 4 2.1 pay the bills. Mr. Robles. 5 MR. ROBLES: Good morning. For Kerr County 6 we have $187,943.29. The airport, $2,278.76. Adult 7 Probation, $3,356.91. Juvenile Probation, $1,029.09. 8 Fund 45, we have $3,000. 9 JUDGE KELLY: Tell them what Fund 45 is 10 again? 11 MR. ROBLES: District Clerk fees. 12 JUDGE KELLY: Okay. 13 MR. ROBLES: Fund 78, County Clerk fees, 14 $751.24. And Fund 95, the 198th District Attorney 15 Forfeiture, $7,125. 16 COMMISSIONER BELEW: I move for approval. 17 COMMISSIONER MOSER: Second. 18 JUDGE KELLY: Motion's been made by 19 Commissioner Belew, seconded by Commissioner Moser to 20 approve the payment of bills as presented. Any further 21 discussion on that? Okay. Those in favor raise your 22 hand. Unanimous, five zero. 23 Budget amendments. 24 MR. ROBLES: We have four today. All line 25 item transfers. 216th District Court, Constable 2, HR 44 1 and Indigent Services. 2 JUDGE KELLY: And again, just to reiterate 3 as this time of year as we go into the budget season for 4 next year, all of these budget amendments are fairly 5 routine with interdepartmental changes -- 6 MR. ROBLES: Yes. 7 JUDGE KELLY: -- and allocation of funds. 8 MR. ROBLES: That's correct. 9 JUDGE KELLY: Okay. 10 COMMISSIONER MOSER: Move for approval. 11 COMMISSIONER HARRIS: Second. 12 JUDGE KELLY: Motion's been made by 13 Commissioner Moser, seconded by Commissioner Harris to 14 approve the budget amendments. Any further discussion? 15 All those in favor raise your hand. Unanimous, five 16 zero. 17 Any late bills? 18 MR. ROBLES: No, sir. 19 JUDGE KELLY: Any Auditor Reports? 20 MR. ROBLES: We do have one for the Justice 21 of the Peace, Precinct 3. Y'all should have a copy of 22 that. 23 JUDGE KELLY: Yes. Is there a motion to 24 approve the Auditor's report? 25 COMMISSIONER LETZ: So move. 45 1 JUDGE KELLY: Okay. 2 COMMISSIONER BELEW: Second. 3 JUDGE KELLY: Motion's been made by 4 Commissioner Letz, seconded by Commissioner Belew to 5 approve the Auditor's Report on J.P. 3. Any further 6 discussion? Those in favor raise your hand. Unanimous, 7 five zero. 8 Monthly Reports. 9 COMMISSIONER HARRIS: No. 10 JUDGE KELLY: Court orders? 11 COMMISSIONER LETZ: Yes. We have the Court 12 Orders from our June 8th meeting, 38111 through 38126. 13 They all look to be in order. I'll make a motion to 14 approve. 15 COMMISSIONER BELEW: Second. 16 JUDGE KELLY: Motion's been made by 17 Commissioner Letz, seconded by Commissioner Harris to 18 approve the Court Orders as presented. Any discussion? 19 Those in favor raise your hand. Unanimous, five zero. 20 Information Agenda. 3.1 status reports from 21 Department Heads. Any Department Head reports? 22 MR. ROBLES: Just as a reminder, our -- our 23 budget for -- for the department requesting budget was 24 due by Friday. We'll be turning in a copy to all of the 25 Court of the departments requested budget, as well as 46 1 some summary sheets by the end of the day. 2 JUDGE KELLY: Okay. And just -- just for 3 information purposes, not going through department or 4 office by office, in general are these budget requests 5 that we're going to review in our coming workshops about 6 the same, or actually a little less than what I proposed 7 in my budget? 8 MR. ROBLES: There are several departments 9 that are underneath the budget -- the one you proposed. 10 JUDGE KELLY: And -- but the bottom line is, 11 the requested budget is actually a little bit less than 12 what I proposed? 13 MR. ROBLES: We haven't had time to analyze 14 that. It was due by 5:00 on Friday. But I'll be sure 15 to notate that in the e-mail that we send to you. 16 JUDGE KELLY: Well, I'm just curious. So 17 let me know when you find out. Okay. Thank you. 18 Let's go on to Item 3.2 status reports from 19 Elected Officials. Okay. 20 Then 3.3 status reports from Liaison 21 Commissioners. 22 COMMISSIONER MOSER: We had a small group 23 meeting to discuss economics at the airport and I'll 24 report that in Executive Session next week. 25 JUDGE KELLY: Good. Okay. Anything else? 47 1 COMMISSIONER LETZ: A few things. I mean, 2 small events but the Hill Country Youth Event Center is 3 trying to open up a little bit here and there. Get a 4 little bit of use of the facility and revenue in. I 5 think most of the Court receives a report that they've 6 had a couple of events, not big ones. So that's good 7 news. 8 COMMISSIONER MOSER: So there was a big 9 event there Saturday, I think they had like 90 cars? 10 COMMISSIONER BELEW: Yeah. 11 COMMISSIONER MOSER: 90 cars and a car show 12 inside of the Ag barn there. It's a fabulous facility, 13 you know, all concrete. It's a lot -- I mean, 90 14 automobiles in there. 15 COMMISSIONER LETZ: It was actually -- it 16 was for the -- the facility, it's a small event, but it 17 was the biggest car show I think they've ever had. I 18 think 88 -- 88 vehicles, 90. 19 COMMISSIONER MOSER: Yeah. Right. 20 COMMISSIONER BELEW: The IT Department -- on 21 another topic that came to our attention the other day 22 that there's no backup power. We've had power outages 23 here recently and we have backup battery power for a 24 little while, those UPS systems. And they have to be 25 huge and they don't last very long. And so I suggested 48 1 to Bruce to look into having us a generator that will 2 keep this thing up and operating, at least the servers 3 here. 4 So we have that at the Sheriff's Department. 5 We have it out in West Kerr with AC/DC. We don't have 6 it right here in the courthouse. So that's something 7 that will be coming up before the Court before long once 8 we get a handle on that. And if you want to add 9 anything to that, Bruce? 10 MR. MOTHERAL: It's in the works. 11 COMMISSIONER BELEW: Okay. It's in the 12 works. Just wanted you all to know. 13 JUDGE KELLY: Sheriff? 14 SHERIFF HIERHOLZER: If I can add something 15 to that. If y'all remember, we do have that very large 16 generator that ran the jail until we did the expansion. 17 And you all actually put in my last year's budget, this 18 current budget right now, $20,000.00 to have that 19 generator -- to see if we could move it and -- and get 20 it -- nobody knew what the actual cost was, but just -- 21 you funded that amount to see if we could get it moved 22 over here to the courthouse. 23 That got put on hold because of the 24 committee and all the expansion, we hadn't done it. But 25 I did ask Shane last week to go ahead and get with the 49 1 electric company, whoever he hired, whoever got the 2 County bid on the electricity, to see what it would 3 actually cost to get that generator moved over here and 4 hooked up, because it is a good generator. There's 5 nothing wrong with it. It's old, it's 23 years old, but 6 it does -- it does very well. 7 COMMISSIONER BELEW: The hours that's on it, 8 yeah. 9 (Talking over.) 10 SHERIFF HIERHOLZER: And it would run this 11 entire courthouse. So I still think -- 12 COMMISSIONER MOSER: Is it gas or diesel? 13 SHERIFF HIERHOLZER: Diesel. 14 COMMISSIONER MOSER: Diesel. 15 JUDGE KELLY: So between the Sheriff's 16 Office, IT Department, and the Maintenance Department, 17 they're looking into this and we're going to try to 18 address that issue. 19 COMMISSIONER MOSER: Good report. 20 COMMISSIONER HARRIS: One other thing I want 21 to add, just a reminder to everybody that we will be 22 having a workshop with our Volunteer Fire Departments 23 this Wednesday out at the AG Barn at 10:00 a.m. 24 JUDGE KELLY: And Veterans Services is 3:00 25 p.m. 50 1 COMMISSIONER HARRIS: That's right. 2 JUDGE KELLY: Wednesday's a big day for the 3 County. We've got workshops with the Volunteer Fire 4 Departments in the morning, we meet with the Capital 5 Improvement Planning Committee at one o'clock and it's 6 -- Commissioner Letz and I will, and then we have 7 Commissioners' Court again at three o'clock for a 8 workshop on Veterans Services. 9 COMMISSIONER MOSER: And those workshops 10 will be video recorded? 11 JUDGE KELLY: YouTube. Yes, they will be. 12 COMMISSIONER MOSER: Okay. 13 JUDGE KELLY: Good. Okay. It is ten 14 minutes of ten. I think we've exhausted pretty much 15 what is on our agenda except for the finance item we're 16 going to talk about in Executive Session back at 10:30. 17 But I will remind the public we will come back into 18 public session to adjourn into Executive Session at 19 10:30. 20 COMMISSIONER LETZ: Judge, on that I'm 21 guessing part of that discussion will be in open 22 session, the first part. 23 JUDGE KELLY: Okay. 24 MRS. STEBBINS: The only part of it that can 25 be in Executive Session relates to the purchase of real 51 1 property. I think that is what can go to Executive 2 Session. 3 JUDGE KELLY: Okay. So we'll get -- at 4 10:30, we'll get a general -- this will be Dusty 5 Traylor, our attorney from RBC Capital. And he's going 6 to provide the County on what financing options we have 7 with regard to our capital items from the budget this 8 year, as well as some of the other items that we're 9 discussing at this time. So I would ask the public to 10 tune back in at 10:30 and we will reconvene. We'll be 11 in recess until then. 12 (Recess.) 13 JUDGE KELLY: Okay. The Court will come back into 14 session. We have a timed item, item 1.9 discussion 15 regarding possible refinance of the series of 16 Certificates of Obligation, finance options for the FY 17 20/21 capital expenses, and possible office building for 18 the Regional Public Defenders Office. 19 And when it comes time to talk about the 20 real estate transactions, we'll go into Executive 21 Session that we're unable to discuss in open session. 22 So with that, we have Dusty Traylor here 23 with us today from RBC Capital, I believe, isn't it? 24 MR. TRAYLOR: Yes, sir. 25 JUDGE KELLY: Okay. And we've got you set 52 1 up there at the podium. We're on YouTube, by the way, 2 so the camera is looking at you and you're being 3 broadcast live. 4 MR. TRAYLOR: Very good. So -- 5 JUDGE KELLY: Now, so just to set the stage. 6 Tanya Shelton, the Auditor, and James Robles, the Deputy 7 Auditor, and I have met with Dusty about finance 8 options. It started initially when we were working on 9 our budget proposal because we're proposing to finance 10 over a three-year period some of the capital 11 expenditures in the budget and we're doing that for a 12 couple reasons. And number one, because we don't have 13 enough money to pay cash. But number two, by -- by 14 moving it to -- yeah, moving it to P and I, it affects 15 how we collect -- calculate our effective tax rate as 16 being in the M and O column, maintenance and operation. 17 So those are the two reasons that we 18 initially started meeting with him on this. And we -- I 19 think we've got 880,000 in our budget for capital 20 expenses. And he's -- and we've discussed a number of 21 options. 22 Then we also in that process, he pointed out 23 to us that we have several series of certificates of 24 obligations that are coming up that we have the 25 opportunity to refinance. And interest rates are so 53 1 favorable right now that we asked him to go ahead and 2 take a look at refinancing those certificates of 3 obligation, which I think will -- and you'll hear in a 4 minute -- is going to provide a substantial savings for 5 us over time. 6 And then the third thing is with this 7 regional public defenders office and trying to find a 8 place to house them. We're looking at a building down 9 the street. We've made an offer and it's almost too 10 good to refuse. So we're taking a look at what we can 11 do to finance the purchase of that building. And then 12 we'll talk about that active purchase, we'll go into 13 Executive Session. But that's what spurred this. And 14 we've asked him to come talk and explain to the Court 15 exactly what we're looking at and get people familiar 16 and comfortable with the financing options available. 17 Dusty. 18 MR. TRAYLOR: Judge, Commissioners. It's a 19 pleasure being with you this morning. It's a pleasure 20 to get to be out and -- and see folks in person, and 21 it's great to get to see some familiar faces. 22 As the Judge mentioned, we have discussed 23 some of these financing needs of the County during the 24 course of the past few weeks and months. But we also 25 here recently also just discovered and visited about 54 1 some of the bonds within the Court -- within the 2 County's existing bond portfolio. And so we started out 3 really this presentation, I've got it in two sections. 4 The first section we look at the County's existing bond 5 portfolio and that lends itself pretty quickly to look 6 right at refinancing analysis. 7 So if you look inside tab one on page number 8 four, see a sheet like this, provides a quick summary of 9 the County's outstanding bond portfolio. And what 10 you'll see there is the County has approximately 29.885 11 million dollars of outstanding obligations. And the 12 obligations that we are looking to refinance, 13 specifically, are the certificates of obligation, or 14 CO's, Series 2012. If you'll look, those have their 15 first call date on 2/15/2021, so within this upcoming 16 fiscal year. 17 And then the other set of obligations we're 18 looking at refinancing are the combination tax and 19 revenue certificates of obligation, Series 2014. Those 20 also become callable within this current -- or in the 21 upcoming fiscal year. 22 It's important to point out that the Tax 23 Reform Act of 2017 took away our ability to do something 24 called an advance refunding on a tax exempt basis. 25 We're no longer able to do that under federal tax law. 55 1 Now in order to effect a tax exempt refinancing, we must 2 be within 90 days of the call date of the -- of the 3 obligations to be refunded. So these particular 4 obligations, the 2012's and the 2014's, we would 5 actually be able to deliver tax exempt refinancing bonds 6 around about the middle of November of 2020. So 7 probably November the 17th, 18th, something. Whatever 8 that 90-day count is there backing up from 2/15/2021. 9 Well, that would actually allow us to be in 10 the market to sell refunding bonds in the middle of 11 October, which is pretty quickly approaching here for 12 us. So the analysis that you'll find over on page 13 number 5 contemplates refinancing the callable portion 14 of the Series 2012 and 2014 Certificates of Obligation. 15 That -- that refinancing actually refinances about 16 $4,915,000.00 worth of the County's bonds. 17 And as the Judge mentioned, interest rates 18 are very favorable right now and so in looking at this 19 refinancing, those particular obligations, if you look 20 down on the page, the chart or the table bottom left, 21 see the -- the average coupon on the refunded bonds is 22 about 3.68 percent. 23 Refinancing, once you factor in the call 24 feature, cost of issuance, underwriter discount, that 25 would have a -- an interest rate conservatively of about 56 1 2.28 percent in today's market, meaning in an 2 arbitragial, you'll adjust the bond over 179 of about 3 three -- we have savings of $346,000.00 and -- on a 4 present value basis, when we -- when we do the financial 5 calculation in today's dollars what's that worth, it's 6 worth about $312,000.00, or about 6.37 percent of the 7 principal amount refunded. 8 And if you'll turn with me over to page 6, 9 we actually demonstrate for you how that savings 10 accrues. That -- that $346,000.00 does not accrue all 11 -- all in one year. That accrues over the course of the 12 remaining life of these obligations. These obligations 13 are stated to kind of retire in 2032. And if you'll 14 look there, the column second from the right, the net 15 savings, you'll see that that $346,000 amounts to right 16 around 30,000 or so dollars per year on average savings. 17 And then the column to the far right is that 18 annual calculation of the present value or the value of 19 in today's dollars of that savings. So this is 20 something that we believe is worthwhile for the County 21 to pursue. Obviously, we can't be in the market right 22 now. We need to wait until we get closer to October, 23 but there -- there are steps that could be undertaken 24 here over the course of the next 60 to 90 days to get 25 you in a position to take advantage of what is hopefully 57 1 a favorable market in the middle of October. 2 COMMISSIONER MOSER: Dusty, that looks very 3 favorable. What's the downside? 4 MR. TRAYLOR: Commissioner, there's really 5 -- there really is no downside. There really isn't. 6 COMMISSIONER MOSER: I wouldn't think there 7 would be but -- 8 MR. TRAYLOR: Yes, sir. 9 COMMISSIONER MOSER: Okay. 10 COMMISSIONER BELEW: Well, if we -- if you 11 remortgage a house, for example -- 12 MR. TRAYLOR: Yes, sir. 13 COMMISSIONER BELEW: -- there's some costs 14 associated with it -- 15 MR. TRAYLOR: Yes, sir. 16 JUDGE KELLY: He's got that in here. 17 COMMISSIONER BELEW: -- and sometimes it's 18 not worth the process. 19 MR. TRAYLOR: The estimated issuance costs, 20 Commissioner, are built into these numbers that -- that 21 we're presenting. 22 COMMISSIONER BELEW: What you've presented? 23 MR. TRAYLOR: Yes, sir. So we're not 24 talking about 346,000 in savings and then from that you 25 pay a bunch of cost issuance. The estimated issuance 58 1 costs are built into these -- these numbers. Yes, sir. 2 COMMISSIONER MOSER: So quite simply looking 3 at what we have, in light of the lower interest rates, 4 looks like the smart thing to do. 5 MR. TRAYLOR: Yes, sir. 6 COMMISSIONER MOSER: Thank you. 7 MR. TRAYLOR: And between now and then, 8 we'll -- 9 COMMISSIONER MOSER: Right. Right. 10 MR. TRAYLOR: I mean, hopefully we're able 11 to get you in a position -- 12 COMMISSIONER MOSER: And you got -- and it 13 has -- and it'll be done in -- if we were to do it in 14 the October time frame. 15 MR. TRAYLOR: Yes, sir. 16 COMMISSIONER MOSER: Okay. 17 JUDGE KELLY: And that's because of the call 18 dates in February of next year. We factor in the 90 19 days, puts us back down into November, and this is -- 20 with interest rates the way they are and with the market 21 the way it is right now, I can't see any financial 22 reason we would not want to do this. 23 MR. TRAYLOR: Correct. And we'll -- as -- 24 you know, we'll -- we can, between now and then, work 25 with you to begin -- and work with you and your staff to 59 1 begin the preparation of a preliminary official 2 statement at the offering document used to market the 3 bond in the bond market and get you in a position to 4 late September, early October visit with S&P, the rating 5 agency that carries the rating on the County, get that 6 rating updated so that you're then in a position to get 7 out to the market and start refunding models. 8 Respectfully, like a -- like a refunding on 9 a house. You go out and -- and issue a new bond, that 10 is just simply used to pay off the old bond and now you 11 have a -- 12 JUDGE KELLY: And -- and just to explain on 13 these bond ratings. One of things that we talked to 14 Dusty about that we have been concerned about is if any 15 of your top ten taxpayers are in default on their taxes, 16 that is a negative impact to your bond rating. And for 17 those -- the Court knows, but for those of you that read 18 in the paper that we've settled with Mooney and they've 19 paid their entire 2019 taxes, we no longer have a top 20 ten taxpayer in default. So now that that's done, we're 21 ready to move on this. 22 MR. TRAYLOR: That's good. 23 COMMISSIONER BELEW: Does that -- does that 24 ding it a little bit, or is it full operating -- 25 JUDGE KELLY: No, we're -- we're back in 60 1 first rate. 2 COMMISSIONER HARRIS: We're in good shape. 3 COMMISSIONER MOSER: And so your estimate 4 here is conservatively what the interest rates could be. 5 MR. TRAYLOR: Yes, sir. Based upon what the 6 market is now it's a conservative estimate. Yes, sir. 7 COMMISSIONER MOSER: So you guys must be 8 really busy because probably a lot of people are looking 9 to refinance. 10 MR. TRAYLOR: That's correct. Yes, sir. 11 COMMISSIONER MOSER: Yeah. Okay. 12 JUDGE KELLY: And if you look over on 13 Page 6, I'll just point out that in that net savings 14 column, the second from the right, we're going to -- 15 we're going to save in the neighborhood of, oh, 26, 27 16 thousand to 30 -- low 30 something thousand dollars a 17 year for the next 11 years. That's the way -- 18 COMMISSIONER BELEW: So, and this includes 19 everything that's listed on page four? 20 MR. TRAYLOR: No, sir. It only includes the 21 portion on page four, the Series 2012 -- 22 COMMISSIONER BELEW: Uh-huh. 23 MR. TRAYLOR: -- and the Series 2014. Those 24 are the only obligations that the County has right now 25 that has a call feature that's -- 61 1 COMMISSIONER BELEW: Call feature. 2 MR. TRAYLOR: -- that's coming up in the 3 current -- in the upcoming fiscal year. 4 COMMISSIONER BELEW: All right. 5 JUDGE KELLY: Harley, if you look in that 6 column it says first call date? 7 COMMISSIONER BELEW: I see that. 8 JUDGE KELLY: The next one first call is in 9 '24, '26, and then the last one's in '29. 10 COMMISSIONER BELEW: So we're just dealing 11 with the ones that are coming up in February? 12 MR. TRAYLOR: Yes, sir. 13 COMMISSIONER BELEW: And the one that's not 14 available there, what's the story on that? 15 MR. TRAYLOR: You notice that that 16 particular obligation has a final maturity, if you'll 17 look on -- at the column right next to first call date, 18 says final maturity. The final maturity on that 19 obligation is 2/15/2022. 20 COMMISSIONER BELEW: That's not one we're 21 talking about, right? 22 MR. TRAYLOR? No, sir. It -- it doesn't 23 have a call feature. It pays off before you would get 24 to a normal call feature. That, I believe, was a CO 25 that was issued for some of the initial planning for the 62 1 East Kerr/Center Point Wastewater Treatment Project. 2 JUDGE KELLY: Any other questions? Okay. 3 That has to do with the refinance. 4 MR. TRAYLOR: Yes, sir. 5 JUDGE KELLY: Let's move on to the next one. 6 MR. TRAYLOR: So the next -- the next slide 7 we get into a couple of analysis that we -- that we put 8 together here related to some options for financing. 9 And Judge, what I -- what I did here is I ran a scenario 10 for a total of $1.8 million amortized over four, five, 11 or seven years. And we also did 2.5 million -- 2.55 12 million amortized over four, five, or seven years. My 13 initial -- so one of the -- one of the spreadsheets that 14 we looked at a couple weeks ago and we had a typo that 15 said three. But I went back and looked and that was 16 actually amortized over four years. So I wanted to 17 change that and -- and correct it for our meeting today. 18 JUDGE KELLY: And let's get everybody on the 19 same page of where the 1.8 comes -- 20 MR. TRAYLOR: Let's do. 21 JUDGE KELLY: We're looking at trying to 22 finance about 880,000 for capital improvements. Mainly 23 vehicles and some Road & Bridge equipment and some road 24 projects. Finance that over a three-year term is what 25 we -- that's what we've put -- that's what -- the 63 1 assumption is in the proposed budget that I have 2 submitted. 3 The other one million is what it would 4 really cost to purchase and bring up to ADA compliance 5 the building that we're talking about that would be the 6 public defenders office just down the street. So if we 7 were to borrow the money to do that, then that would be 8 a total of 1.8. 9 MR. TRAYLOR: Yes, sir. The -- the 10 scenarios that were amortized over four or five years, I 11 utilized an interest rate of about 1.35 percent. Okay. 12 We believe that that's a little bit conservative. I 13 think that we can get that down. If we put this out to 14 bid to various banking institutions to purchase it, I 15 think that that rate would likely come in closer to one 16 percent. 17 The -- the seven year amortization, we ran 18 that at about a 1.7 percent interest rate. And again, I 19 believe that that would come in lower than that. I 20 think we could probably get that in below 1.5. But I 21 wanted to be conservative as we looked at these debt 22 service figures here on an annualized basis. 23 So you see the 1.8 million, four years would 24 -- would cost you about $470,000 per year, five years 25 would be about $380,000, and the seven year payback 64 1 would be somewhere between 275 to $280,000 per year. 2 Then moving on to the 2.55 million, again, 3 it's -- I think we -- based upon your -- your ultimate 4 need, your ultimate project with the open dollar amount, 5 obviously we can adjust these figures going forward. 6 But the 2.55 over four years, be about 665,000 per year, 7 five years would be about 535,000 per year, and then the 8 seven year payback would be plus or minus about 390, 9 $395,000. 10 COMMISSIONER MOSER: What's the basis for 11 the 2.55? 12 COMMISSIONER LETZ: Executive Session. 13 COMMISSIONER MOSER: Huh? 14 COMMISSIONER LETZ: Executive Session. 15 COMMISSIONER MOSER. Okay. I understand. 16 MR. TRAYLOR: This -- this type of 17 financing, the way we have laid this out is at a -- the 18 assumption of a tax note. A tax note is an instrument 19 that Counties have the benefit of utilizing under state 20 law. One of the requirement is that the payback cannot 21 exceed seven years. Okay. That's one of the reasons 22 that we limited this thing to seven years. 23 Also in light of the projects that you are 24 looking at here as well and just trying to be sure. A 25 lot of the counties goals is being financially 65 1 conservative and prudent as well. 2 So that's a great -- a great instrument to 3 use. You can pay back debt service on a tax note inside 4 of your INS budget so that it does not come out -- have 5 to come out of the M&O portion of your budget, which is 6 also very, very important given some of the budgetary 7 concerns of the County as well. So I wanted to point 8 out those two items. 9 JUDGE KELLY: Now, just to keep everybody 10 focused on what -- what we were discussing with Dusty. 11 We're looking at this as a type of bridge financing, 12 like a bridge loan. We were talking about trying to 13 present a bond issue to the people in November. We've 14 decided against that. We don't think this is a good 15 time to do that. But we do think it's something that 16 we're probably going to the people with in the next year 17 or two. And so this will be an opportunity for us to be 18 able to tie up some of the land that we're talking about 19 to do this, purchase a building, and have interim 20 financing on it until we're able to take that to the 21 people in a bond issue and do all the cross-financing. 22 That's -- that's really the whole idea behind what we're 23 talking about. 24 COMMISSIONER LETZ: Judge, on the -- the 25 capital item, 800,000 capital items -- and I haven't 66 1 seen the budget in detail so I'm not sure what that is. 2 But I'm always leery of financing kind of annual capital 3 purchases. I presume there's cars and things like that 4 in there. And we've gone back and forth of doing it 5 with debt, doing it with leases, buying outright. And 6 we've bounced around a lot from year to year. And I'd 7 be really concerned about financing those capital 8 purchases unless we have some sort of a plan in where 9 we're going for the next three years after this with 10 those capital items. 11 COMMISSIONER BELEW: What happened -- 12 JUDGE KELLY: That's fair. 13 COMMISSIONER BELEW: -- what happened to the 14 lease idea for the Sheriff's Department? 15 JUDGE KELLY: The lease -- the way we dealt 16 with the lease idea -- I don't know if -- did you 17 participate in that meeting, Dusty, with -- 18 MR. TRAYLOR: No, sir. 19 JUDGE KELLY: -- Bob Reeves, our Tax 20 Assessor Collector? 21 MR. TRAYLOR: I do not believe so. 22 JUDGE KELLY: We sat down and talked with 23 our tax assessor collector about that and he went -- he 24 walked us through it. I -- I can't do it, we'd have to 25 get him in here to show you, but walked us through the 67 1 formula of how we compute the effective tax rate for our 2 revenue caps for the new legislation that was passed 3 last year. 4 There's a significant difference if it's 5 under the M&O side of our expenditures versus the I&S 6 side. And so the lease keeps us in the M&O column. 7 MR. TRAYLOR: Exactly. 8 JUDGE KELLY: And that -- that gives us more 9 restrictions as to what we compute is the effective tax 10 rate. And we have a great more flexibility by putting 11 it over in the I&S. 12 MR. TRAYLOR: That's absolutely right. 13 JUDGE KELLY: And it -- it -- it improves 14 the return to the people. 15 COMMISSIONER BELEW: That's the important 16 part, which is most beneficial to the taxpayer. 17 JUDGE KELLY: But now, as Jonathan's comment 18 and I think it has a lot of validity and that is, we're 19 talking about financing these capital improvements that 20 would normally be in a budget either as a -- you'd 21 normally expect to see it as a lease or as an outright 22 purchase. And we're talking about financing that over a 23 three-year period of time. And that is an encapsulated 24 risk. 25 COMMISSIONER LETZ: And it's also, it's 68 1 complicated in my mind. It's three years, but then we 2 are also looking at refinancing this three-year note 3 over a longer period, so then if we're not careful, 4 we're all of a sudden financing cars over 30 years. 5 COMMISSIONER MOSER: Right. 6 JUDGE KELLY: We don't want to do that. 7 SHERIFF HIERHOLZER: They won't last 30 8 years. 9 COMMISSIONER LETZ: It's -- I'm not opposed 10 to doing it, we just need to be very careful and -- and 11 think of -- and if we can't decide this year what we're 12 going to do next year -- 13 COMMISSIONER MOSER: Right. 14 COMMISSIONER LETZ: -- but we need to have a 15 plan to -- and at least ask our departments what their 16 three-year plan looks like on capital items, and do we 17 roll some of that forward, do we -- just to be aware of 18 that whole issue. 19 COMMISSIONER BELEW: Does it really save 20 money when you look at it that way -- 21 COMMISSIONER LETZ: Right. 22 COMMISSIONER BELEW: -- and -- and it might 23 not. 24 COMMISSIONER LETZ: Just got to make -- be 25 very careful of financing -- 69 1 JUDGE KELLY: Well, that's not so much 2 saving money, that's being able to afford what we need. 3 COMMISSIONER LETZ: Right. 4 COMMISSIONER BELEW: Yeah. And then you're 5 going to go back and you -- and I think I heard you say 6 that then after this happens, we're going to go back and 7 then maybe convince people that we need a CO on this 8 building over here. 9 COMMISSIONER MOSER: Well, that's why you 10 have the bonds. This is a bridge loan. 11 COMMISSIONER BELEW: I know. On the bridge 12 loan it would pay off this. 13 JUDGE KELLY: Well, there -- there's two 14 components -- there's really three. We'll get to the 15 third one in a minute. 16 COMMISSIONER BELEW: Right. 17 JUDGE KELLY: The first one is the 18 refinance. The refinance is a no-brainer -- 19 COMMISSIONER MOSER: Right. 20 JUDGE KELLY: -- in my opinion. The second 21 one we're talking about is financing capital improvement 22 for this year's budget, the FY 20/21 budget. And that's 23 a little bit more complicated. And it's not that it -- 24 we're going to have a savings to the people. It's 25 actually going to cost a little bit more to pay some of 70 1 the finance charges on this, but we're going to be able 2 to afford everything in a year where money is really 3 tight. That's what we're looking at. 4 COMMISSIONER BELEW: Well, I'm looking at -- 5 for a simple way to explain that to voters. And I don't 6 hear it yet. 7 JUDGE KELLY: Well, if -- if we're buying a 8 $50,000.00 automobile -- 9 COMMISSIONER BELEW: Okay. 10 JUDGE KELLY: -- and we don't have the money 11 to pay for it cash, but we can pay a third of it over a 12 three-year period of time, a third, a third, a third, 13 then we can afford a new vehicle. The Sheriff's 14 Department needs new vehicles. How many are we talking 15 about buying? 16 SHERIFF HIERHOLZER: Well, and -- and I'll 17 say two things. Number one, in this coming year's 18 budget I've asked for seven, okay, seven new patrol 19 cars. But the only thing I would caution against is 20 what we did a number of years ago when we got the 2010 21 patrol cars. Because the County did a CO, and it -- and 22 it made sense at that time, the interest rates were low 23 and everything else. And we did it and we got like 15 24 cars, okay, which was great, it worked out. They were 25 going to pay them off in three years. But the problem 71 1 is, you have 15 cars that all wear out at the same time. 2 And so now you -- we were having to try and 3 since we weren't doing CO's the last several years, we 4 were trying to replace, you know, six or seven of those 5 15, but it took you three years to do it. So by the 6 time we finally got rid of the last of the 2010s, which 7 was this year, I have patrol cars bumping 200,000 miles 8 on it because we couldn't get rid of them soon enough. 9 So I would caution about how many vehicles we buy at one 10 time. And that's why we're trying to get on a schedule 11 of, you know, seven to eight a year and no more. 12 JUDGE KELLY: And the Auditor's office and I 13 sat down and discussed this. We feel like we're back to 14 the point that we've got a -- a fair rotation of 15 vehicles to be able to do this, and we're a little 16 older, a little wiser on how to do it. And we think we 17 can do it. 18 COMMISSIONER LETZ: Would the plan be, 19 Judge, then to do a CO again next year for the capital 20 items? Potentially? 21 JUDGE KELLY: Well, we don't know where 22 we're going to be financially next year. 23 COMMISSIONER LETZ: Well, and that's -- 24 COMMISSIONER BELEW: That's what it sounds 25 like we're headed for. 72 1 COMMISSIONER LETZ: But that's kind of the 2 -- the risk is that when we made the decision in -- 3 whenever it was when we bought 15 cars, you're in one 4 set of finance situation and taxes and all that, and 5 that might have been even at the time when we were -- 6 when the economy crashed was when we did that and we had 7 -- the same thing we're doing now but for different 8 reasons. Anyway, we've just gotta be very careful that 9 we don't repeat the mistakes we made -- I won't say 10 mistakes but -- 11 JUDGE KELLY: And -- and we're very mindful 12 of that. What we wanted Dusty to do is run the numbers 13 so that we can come have this conversation with you -- 14 COMMISSIONER LETZ: Right. 15 JUDGE KELLY: -- about is this something we 16 want to do. Because if we can finance these cars over a 17 three-year period of time and we're on a rotation now 18 because we did pay cash the last few years, that we can 19 do that, then it's just like going down and buying a new 20 car every third year. 21 SHERIFF HIERHOLZER: Well, the only other 22 thing I would recommend looking at is that rotation of 23 the seven needs to be patrol cars because that's the 24 hardest driven ones, and the ones that get the most 25 mileage all the time. What we've been doing, I've got 73 1 about another ten that are, you know, like CID or 2 unmarked cars that do not have to be police package type 3 cars. 4 Now, those cars right now are on their last 5 leg, because they've either been patrol cars that we 6 rolled all the way down or they've been used cars or 7 seized cars that we got. So yes, I don't think we 8 should go over seven to eight at the most patrol 9 vehicles in a one-time purchase because of rotating 10 those out. 11 Now, if you added eight or ten more of just 12 normal four-door cars, okay, not police package for your 13 -- your investigators, your warrants, your people -- you 14 know, warrant transport people that are just driving 15 miles and don't need the high package, then I think you 16 would be advantageous in that because those cars can 17 easily last 10 or 15 years. 18 COMMISSIONER MOSER: Right. 19 SHERIFF HIERHOLZER: They're not -- don't 20 have the wear and tear that a patrol car has. And we 21 are in dire need of replacing a lot of those cars. 22 COMMISSIONER BELEW: What -- what's your 23 average cost of a fully equipped cruiser? 24 SHERIFF HIERHOLZER: Police car? 25 COMMISSIONER BELEW: Uh-huh. 74 1 SHERIFF HIERHOLZER: I have it in this 2 year's budget. It's right at -- 3 JUDGE KELLY: Around 45,000? 4 SHERIFF HIERHOLZER: Yeah, between -- right 5 around 45,000, totally equipped. Forty-five, a little 6 bit under 50. I've asked for seven in this year's 7 budget, and the seven totally equipment patrol cars are 8 413,000 is what it came to. Okay. 9 So -- but if we were to get plain cars, you 10 know, you're talking you can do those for probably 11 another 20,000 apiece for a decent, you know, just good 12 economy wise, good gas mileage investor type vehicles, I 13 think you could get some of those. 14 COMMISSIONER BELEW: But this -- this would 15 not go past the life of that vehicle. And that's the 16 important thing. What I thought I was hearing a minute 17 ago was this was going to be stretched out over a time 18 longer than that vehicle would last. 19 JUDGE KELLY: No. We're talking about 20 different financing options. The refinance was the 21 first one. This one is the capital expenditure 22 financing. And this one we do not want it any more than 23 three years. And -- and just to remind everybody, we're 24 not here to make policy decisions today as to what we 25 want to do about all this. We can talk about it. But 75 1 we're here trying to get financial information so that 2 we have real numbers to work with when we make this 3 decision. 4 COMMISSIONER HARRIS: It's knowing our 5 options. 6 JUDGE KELLY: Right. 7 MR. TRAYLOR: One of the things I -- just 8 pointing out, just kind of listening to the conversation 9 here, one of the things that you might consider from a 10 budgetary policy decision moving forward is if you were 11 to, kind of, attack this plan in this fashion this year, 12 then also maybe incorporate something in your budget for 13 -- for future years. You know, we also have in our -- 14 we always have in our audits depreciation. But those 15 depreciation figures are usually just the County 16 interests. And one of the things that we oftentimes 17 encourage our clients to consider is, especially as it 18 relates to things like rolling stock, is get into a -- 19 try to get into a cycle where for your rolling stock 20 have a cash funded depreciation account, such that as 21 those vehicles over time then begin to wear out, you 22 have built up a little bit of a fund balance there in 23 those accounts to fund the next cycle -- the next wave 24 of vehicles. Because they will wear out. 25 COMMISSIONER LETZ: Dusty, is it possible to 76 1 issue a tax note but have it -- part of it be a 2 three-year and part of it be a longer period or -- 3 MR. TRAYLOR: Absolutely. 4 COMMISSIONER LETZ: So you could have -- so 5 you could guarantee that we're paying the cars off in 6 three years, but a little bit more flexibility on the -- 7 MR. TRAYLOR: Absolutely. 8 COMMISSIONER LETZ: -- capital items? 9 MR. TRAYLOR: That's exactly right. Yes. 10 And that's -- that's one of the things we can do, is we 11 put together that package and you guys give us the 12 number -- total dollar amount and the dollar amount of 13 each type of item that you want to pay back. We can 14 build that in our model to amortize certain items within 15 the -- within one series of tax notes that pay off over 16 three years and some may be amortized over four or five 17 years. 18 JUDGE KELLY: So remember that on this 1.8 19 what -- there's two components to that. One is the 20 capital expense that we're trying to finance, and the 21 other million is buying that building, which is meant to 22 be an interim loan subject to going to the voters for a 23 bond issue. 24 Okay. And then -- and before we -- we turn 25 the page on this and start talking about going into 77 1 Executive Session, the 2.55, the numbers that we're 2 adding to that are specific parcels of land that would 3 be part of a bond issue that we've worked at at the 4 capital improvement planning committee level, because 5 there are some very good bargains out there to take a 6 look at and we're looking at financing on that. That's 7 why we bumped the number from 1.8 to 2.55. 8 COMMISSIONER MOSER: Okay. 9 JUDGE KELLY: And we're going to discuss 10 that in Executive Session. But this is the basic 11 finance information and we wanted to make sure that the 12 entire court was up to speed and people understood what 13 we're trying to do to address this year's budget, as 14 well as provide for the future. 15 Any other questions for Dusty? As always, 16 excellent job, Dusty. 17 MR. TRAYLOR: Thank you, guys. Appreciate 18 you. 19 JUDGE KELLY: Okay. So with that, I think 20 it's time for us to go into Executive Session to talk 21 about the specific properties that we might be trying to 22 finance. So let's take a five minute break and we'll 23 come back into Executive Session. 24 We'll be in recess. 25 (Recess.) 78 1 (Executive Session.) 2 (The following transcribed from YouTube.) 3 JUDGE KELLY: It is 11:33 a.m., and the Kerr 4 County Commissioners' Court is coming how of Executive 5 Session back into open session. Is there any action on 6 our Executive Session. 7 COMMISSIONER MOSER: Judge, I would make a 8 motion that the Judge, with the counselor advisory work 9 of the CIP, be authorized to enter into negotiations for 10 real property that could benefit the County in future 11 use. 12 JUDGE KELLY: Okay. 13 COMMISSIONER HARRIS: Potential property. 14 JUDGE KELLY: Potential property, yeah. 15 COMMISSIONER LETZ: Second. 16 JUDGE KELLY: Motion's been made by 17 Commissioner Moser, seconded by Commissioner Letz to 18 authorize the County Judge to enter into negotiations 19 for the possible acquisition of property for use by the 20 County in the future. Any other discussion or debate 21 about that? Those in favor raise your hand. Unanimous, 22 five zero. Any other business before the Court today? 23 Then the Court will be adjourned. 24 * * * * * * 25 79 1 STATE OF TEXAS * 2 COUNTY OF KERR * 3 I, DEBRA ELLEN GIFFORD, Certified Shorthand 4 Reporter in and for the State of Texas, and Official 5 Court Reporter in and for Kerr County, do hereby certify 6 that the above and foregoing pages contain and comprise 7 a true and correct transcription of the proceedings had 8 in the above-entitled Special Commissioners' Court. 9 Dated this the 24th day of June, A.D. 2020. 10 11 /s/DEBRA ELLEN GIFFORD Certified Shorthand Reporter 12 No. 953 Expiration Date 04/31/2021 13 * * * * * * 14 15 16 17 18 19 20 21 22 23 24 25