Min - City Council - 1983 - 05/05 - CalledALLEN CITY COUNCIL
CALLED - SPECIAL EMERGENCY SESSION
May 5, 1983
Present:
Mickey Pierson, Mayor (arrived at 6:37 p.m.)
Council Members:
Joe Farmer, Mayor Pro Tem
Jem McClure (arrived at 6:37 p.m.)
Rex Womack
Don Rodenbaugh
Ward Paxton
Dennis Offutt (arrived at 6:46 p.m.)
City Staff•
Jon McCarty, City Manager
Marty Hendrix, City Secretary
The called - special emergency session was called to
order by Mayor Pro Tem Farmer at 6:34 p.m. on Thursday, May 5,
1983, in the Council Chambers of the Allen Municipal Annex,
1 Butler Circle.
This called - special emergency session had been called
in order to discuss matters pertaining to the development of
the west side utilities that will service the Manufacturers'
Outlet Mall site, located at S.H. 121 and U.S. 75.
City Manager Jon McCarty advised the Council that repre-
sentatives from the Belz Enterprises, Inc. were present
to discuss with the City Council various aspects on the financing
of the construction of the west side utilities, those individuals
being Marty Belz, President, and Jimmy Williams, Finance Director.
Mr. Williams advised the Council that under the existing pay
back agreement between the city and Belz Enterprises for these
utilities, 908 of the sales tax revenues would be used to pay back
the loan until it reached $500,000, then 808 would be used until
the loan reached $200,000, then 608 of the sales tax revenue would
be used to pay off the remaining balance. Mr. Williams advised that
he had not calculated in the use of pro rata fees collected by the
city on connections to these utilities, but those fees would also
be used to pay off this loan.
Mr. Williams advised the Council that if the sales tax revenue
and pro rata funds were not enough to pay the interest on the
principal, then the additional interest accrued will not be added
on, thus the city would not have to pay the additional interest.
The Council discussed with Mr. Williams the pay back of the
cost of the utilities using the sales tax revenue and the use
of the pro rata connections and explained how the pro rata is
calculated on a linear foot basis.
The Council expressed to Mr. Williams their previous concerns
on the initial information regarding the financing of these
utilities such as the setting of a ceiling on the interest rate
and establishing a period of time on the carry. The Council advised
that they were looking to the Belz Enterprises for an estimate on
how long it will take to pay back the costs of these utilities.
ALLEN CITY COUNCIL
Called - Special Emergency Session
May 5, 1983 Page 2
Again, the Council reviewed with Mr. Williams the calculation
of the pro rata fees and the fact that they can be calculated on
the linear foot or by the acre, and the city would like the option
to determine which way it will be calculated in this situation.
Also, Mayor Pierson requested that any pro rata collected and paid
to Belz should be applied directly to the principal of the loan.
Discussion continued between the City Council and Belz re-
garding the only collateral the Belz Enterprises has is the
agreement for payment with the city using the sales tax revenue
and pro rata collections, drawing up of a formal contract for
the pay back now that the construction figures are available,
the bids received on the construction of the utilities and the
low bid, a review of the estimated sales tax revenue to be
received in the first year and years to follow, estimated time
for completion of construction of the mall and when the construction
will commence, the terms of the loan being on a draw basis, a
review of the estimated calculations on the interest that will
be accrued, the sales tax revenues will be applied to the total
dollars of the loan, when the city will have to make the first
payment, how sales tax revenue payments are made to the city
from the state, and if there is a delay in the construction of
the mall and the receipt of sales tax is delayed, then the city
would be concerned about the amount of the accrued interest that
will occur.
Based on the above discussions, it was the consensus of the
City Council that the city staff proceed with drawing up of an
amendment to the agreement between the City of Allen and the
Belz Enterprises.
The called - special emergency session was adjourned at
7:19 p.m.
These minutes approved on the 19th day of MAY
M. . Pierson. MAYOR
Marty Hendrix, ITY SECRETARY 1