Travis County Commissioners Court
February 27, 2007
Item 32
Number 32 is to consider and take appropriate action on certain legislative issues and proposed bills before the 80th Texas legislature including the following. A is house bill 1517 relating to the reporting of expenditures for region slat slative communication by local government entities. Good morning.
>> we don't have anything new. I don't believe.
>> 1517, judge, has had a lot of concern over at tac. The reason I値l make a few comments on it, it impacts county officials and employees communicating with the state and testifying in front of committees. Since I do that a fair amount, it would impact what I do. It's an interesting bill and hard to figure where it's coming from because we are an instrument tall ty of the statelve I would think that they would welcome the fact that when we have issues, bills we think we ought to have to make what they tell us to do work or problems with funding, that we would provide them information. But what in essence this bill does, for people like us, that gopher and testify or communicate with the state, there would have to be a cost analysis of what that costs, and not only would we have to collect the complete data, salary and indirect costs, they would expect that to appear on the county's financial statement statement. The essence of this really is that, that really does cutoff communication between the two governments. And it's hard to understand that anyone thinks that's in the name of good government. It would be just like, as if you said to me, an appointed official in Travis County, every time you come and talk to the Commissioners court, we want a complete cost accounting analysis of what that costs so either you want communication or not. So it's a very strange bill. It's hard to believe it's in the interests of the public.
>> do we want to come up with a letter that sets forth whatever reservations we think we have ?
>> yeah, we do.
>> I hope the sponsor would be interested in hearing how impacted governmental entities perceive the bill.
>> yeah.
>> what impact we think it will have on us.
>> let me say, judge, the sponsor of the bill has met with tm l. I知 not certain, but possibly in that meeting were also representatives of cuc or ta c. He did express an openness and willingness to consider part of the bill and some of the most onerous part of the bill he indicated in that meeting as it was reported to me, I was not in the meeting, that that was not his intent. So tml is working with him to try to address some of these issues. But certainly a letter from us affirming our concerns would be very appropriate.
>> yeah. I had no idea what 1517 was.
>> you would think they would common our input. Just such an odd bill.
>> can we have that by next week ?
>> yes, sir.
>> that way the court can look at it and tweak it if we need to.
>> uh-huh.
>> get it over there to them them. I would think that something as fairly straight forward and objecttive would be help helpful.
>> yes, sir. As drafted it's understand understandable that susan would express these concerns concerns. It would, for example, judge require you to kind of keep your time like a lawyer. If you were to contact a legislator, would you have to make an entry at some point that would have to be accounted for in some sort of physical matter, a percentage of your time that was allocated to that contact would then have to ultimately all be totaled and put under our financial statements. That's what it says right now.
>> I would not receive additional compensation from the state.
>> I don't think they planned on that.
>> I didn't read that part at the end of the bill, but I知 sure it's in there.
>> more importantly, I think as far as the points made, we have an obligation under open government law to detail what we are doing in open court sessions. So this would be utterly redundant to our open records and open government processes. I think that that is the big biggest consideration here. It makes us distinct from private sector that has no obligations to that kind of, it creates an unnecessary burden and also doesn't increase the information available to the public.
>> something that kind of makes those points in letters that we can approve and sign next week would be helpful.
>> okay.
>> judge, if we can skip to e because trish needs to depart.
>> e is draft bill relating to the powers and duties of Travis County healthcare district's board of managers and to employee benefits of certain employees of that district.
>> good morning. You have in front of you, I hope, a summary of our local bill guide and talking points related to that. I壇 like to just briefly go through this in very high level and would request that you give consideration to support for our local bill as it affected matters that affect the hospital district in support of the healthcare service delivery obligations obligations. Our local bill has nine sections. And several of them relate to operational matters of the district. Several relate to transition transitions that will occur from transferring operations from the city of Austin and Travis County to the district over the coming years, and several relate also to matters of healthcare service delivery in the region. The section one essentially would request and give us the ability to issue revenue anticipation notes, which is something we have discussed with this court before, in terms of our ability to have a low-cost financing mechanism to handle our cash flow matters from taxing period to particularing period. This is an ability that other district in Texas do have. Section two is language that would clarify what it is that we have authority to contract with for the delivery of healthcare services. Section 3 and 4 relate to our ability to continue to work on projects on a regional nature. We are not a regional taxing district but we have the ability to work with neighboring counties on healthcare delivery solution solutions and try to develop solutions for community that impact all our service areas areas. Three and four would give us not only the ability to work on a regional basis but give us the ability to create organizations and potentially help finance organizations that would address regional solutions. I think this is also in line with at least one bill filed with representative nashtat nashtat's office, house bill 882, which address local communities abilities take work on service delivery on on--healthcare service delivery on a regional basis basis. Section five has to do with the district' ability to employ physicians. Again this relates to the transition of the operations of the clinic system to the district, and gives us an express ability to employ physicians that does not exist in our statute today. Six, excuse me, five and six are related. They are related to the same meater of employee physician addressing two different statutes. Section 7 has to deal with a prohibition put on this district in its enabling legislation that prevented it from applying a sales tax although that is an ability that every other district in Texas has. We have no intention of applying a sales tax but are mindful of the discussions happening currently in the legislature about revenue caps and rate increases, and some discussion about the ability to potentially reduce property taxes with an offsetting sales tax, which would be a local authority. If we are not able to avail ourselves of a sales tax, those provisions would be of no benefit to us if we lost revenue from a property tax reduction. Section 8, again, has to do with the transition of the clinic system to the district. And it is a very important piece of legislation for us in terms of our priorities. We are trying to make sure that whatever system the healthcare district adopt for the transferring employees, that their retirement in the city of Austin is protected and they are able to continue to retire out of that system. This section basically would provide for proportion all ty between the city of Austin transferring employees and the plan that the district would adopt. Section 9 is having to do with a situation, and I would say that this is really trying to anticipate a future situation that we couldn't give you a specific example about today. But we are concerned that there could be losses to the federal funds that the district receives. We refer to them and talk about this many times as matching funds. There are dish and up l. Dis disproporesel share and upper payment limits monies that the district receives through its sharing arrangement with seaton. There have been discussions at the federal and state level, and the federal about reducing those amounts of monies available to the states, which would like like-wise impact us. And also discussions at the state level about re redirecting funds from the u upl programs, additional programs, to other healthcare activities which also would affect the district. The district right now currently is budgeted in this current fiscal year to receive approximately 18 million out of its total 76 million budget from those funds. We can foresee a time in the future where if there were, and this is hard to predict, but if there were a significant loss of revenue to the district, we may be in a position of having to push back a roll back rate, unless we made a decision to cut services that were in line with the cuts in revenue. So this is essentially just creating an affirmative ability that if we were in a position where our funding were significantly curtailed and we had to come to this court and discuss either cutting services or trying to raise additional funds to continue services, that we would be in the position of affirmative possibility of taking a vote to the community to grant a new rate as opposed to pushing, asking you to push back roll back, and then potentially be subject to a roll back petition.
>> what are the other, the other, I guess the urban counties that have healthcare districts, and the money is maybe not funneled down to the district but used for services,, what are they doing? Have you basically touched base with them ?
>> the other districts are in a slightly different position than we are, sir.
>> why ?
>> because they do operate hospitals and they have other sources of revenue that they rely on besides those additional upl revenue revenues. Because our district does not operate a hospital, our two sources of revenue right now are the tax revenues that we raise as well as the sharing of additional upl that we only receive by virtue of this lease arrangement that we have with seaten. The effects of cutting back on addition upl we would anticipate essentially, if the state took an action to reduce or redirect dish and upl dollars aware from those programs to other programs, that the state would also take an action to make those hospitals whole per se. In in other words, they would increase their direct reimbursements to help the hospitals mitigate the effect of that redirection. Because the district does not provide services and would not receive direct reimbursement from medicaid, we have no yeah to offset those reference. In this case the hospitals would be less impacted than the district would be because we have no source, no ability to make up that revenue in another way, where those other district would.
>> so we are the only ones as far as the tax structure that would be impacted.
>> actually, yes.
>> if the dish money was not made available? Yes, sir, because of the nature--yes, sir, because of the nature of our arrange arrangement with seaten for the lease and operation of breckenridge.
>> any other questions, comments? Move approval.
>> second.
>> you're asking us to support the legislation, basically.
>> yes, sir.
>> any discussion of the motion? An all in favor. Show than house court finally. Thank you--show unanimous court. Finally. Shall we go back to the court and pick up number cr? Draft bill relating to the criminal and civil enforcement of the required payment of toll for use of certain turn page projects s s--turnpike projects.
>> thank you judge. If you would like to--
>> I値l go back to b. Anything on y? Any progress ?
>> .
>> I do have one itemone tex dot has a bill, and my an understanding is, correct me if I知 wrong, it is tex dot dot's desire, this bill that has been filed, tex dot is behind it, is far better than what we have before us. It essentially keeps the collection of delinquent toll fees a civil matter handled tex dot. In light of that bill, I see no reason for us to continue.
>> let's postpone c and have that bill before us next week.
>> that sounds find.
>> can we get a copy of it ?
>> it hasn't been filed yet. I don't know if we have a copy that we are able to share with the court yet but perhaps by next week we will.
>> some sort of summary.
>> yes, sir.
>> that that one is better than this one.
>> some have some prefail draft that I can make available to all the member.
>> let's put it on the agenda next week. B, house joint resolution 61 proposal a constitutionel amend am allowing a state mandate imposed on a county to have effect only if the state provides for paper to the county of the cost of the mandate. I move approval.
>> second.
>> good thing, isn't it ?
>> yes, sir.
>> that's what I call a good government bill. Discussion? All in favor. That passes by unanimous vote. D, consider and take appropriate action on request for regulation of land use authority for Travis County and/or other counties. I have gotten hill country e-mails. Rest of the court gotten them on land use authority? Next week maybe we invite one or two of them down to see if we can make a little progress on this one.
>> just as a note on that, I believe that the bill that we are looking at has a triggering mechanism has only the 130 corridor, the road, as the triggering mechanism and does not reach to western Travis County, does not reach to water quality.
>> I think it's undetermined on those folks.
>> on the 130, has that been filed ?
>> I don't believe it has.
>> perhaps we should add for the discussion for next week another proposed bill not yet filed from patrick rose rose's office that would have a triggering mechanism water quality.
>> e we approved a moment all. Right ?
>> yes, sir.
>> f is draft bill relating to financial accounting and reporting for the state and certain political subdivisions of state. We're waiting on the bill to be filed on this one. None had been filed as of late yesterday. So we'll have it back on next week. G is reconsideration of vote to sub senate bill 12 relating to programs for the enhancement of air quality, including energy fish efficiency initiatives, providing penalties. Miss noel.
>> good morning. The objecttive of this bill is to spend all of the money in the terp and lirp program program. I知 urging tract to support this specifically with regard to the lirp provision provisions. As written, senate bill 12 requires replacement. Current, I repeated myself, to be new, but it's difficult for a person living at 300 percent of the poverty level to aforward a brand new car. With full insurance coverage coverage. It will likely be charged a higher interest rate because of bad credit. This would make it more difficult for a person to replace a dirty car with a cleaner vehicle. This should be changed to -- at the very least a 1996 or newer vehicle, maybe even a 2000, but not a brand new one. This bill also requires that the retiring vehicle be at least ten years old in order for it to be replaced. The age of the vehicle should not matter. The goal of the program, again, is to get dirtdirt-- dirtdirt--dirty cars off the streets.
>> the standard ought to be that you pollute to a certain level sph.
>> should it be the replacement with a fuel efficient car rather than a new car ?
>> no, it should just be replaced with a newer car that has already passed the safety and emissions pork of the test.
>> if you can't--portion of the test.
>> if you can't pass the test because your car plutes then you ought to qualify.
>> correct.
>> okay.
>> this bill also requires the county to provide an electronic means to distribute the funds. The repair facilities may have to pay a fee to a credit card company for this service. In addition, currently the l lirp program requires a person to pay up to, the program reimburses an applicant up to $600 for the repair and diagnostics of a noncomplying vehicle. This bill does not increase the repair portion of that. This bill should require a certain increase, maybe up to $900. Currently anything over $600 the applicant must pay for. Extra lirp funds may be used for air quality improvements in consultation with tc e q. This bill permits the allocation of unspent lirp funds for air quality projects but the bill states that the county cannot spend more than $5 million per year per project, and this funding must be matched on a dollar per dollar basis. The county taxpayers have already paid into the lirp fund and should be able to withdraw from this fund without requiring additional county mandatory commitments commitments. The tc e q, auto manufactur manufacturers and car dealers by this bill would have the means of marketing, to market this program instead of the counties. The lirp is an available program that is currently used utilized due to lack of public awareness, and this bill proposes to charge tceq auto manufacturers and car dealers with marketing this program. However, it is the county in the best position to market this program because we have the most comprehensive database of individuals eligible for this program and the funds should be allocated for public out outreach at the county level level.
>> so this responsibility is being taken from counties ?
>> correct. And will be given to the auto dealer manufacturers and the new car dealers and tceq.
>> okay. What about the clean air coalition? Has it addressed this? Or the clean air force ?
>> they have not addressed this yet.
>> what about our other central Texas counties? In other words, are we fighting the state alone or do we have some help ?
>> there are several other counties that, again, support the intent of the bill but have raised some questions with some of the provisions and they have shared our concerns.
>> okay. And these are their concerns also ?
>> I believe so.
>> yes.
>> some of them.
>> not to cut you off, but.
>> fine.
>> this is a letter. Should we try to get this on the clear air force and coalition agenda ?
>> yes, it will be discussed tomorrow at the clean air coalition's meeting.
>> the hearing is this week Thursday, judge, in in the senate.
>> and how does the Texas automobile association feel about this ?
>> I don't know the answer to that question. I think that they would support it.
>> you think they would? Given the fact that they are going to basically be asked or forced along with tceq to do this work sm.
>> I may misunderstand the bill. I think the way it works is it would give them the opportunity to sell new cars cars. So I think they are reimbursed for their expense expenses out of the program in connection with helping market to get the old cars off the road and sell new cars. I would think that it would be something they would generally support.
>> where is senator watson from ?
>> excuse me ?
>> what county is senator watson from ?
>> Travis County as far as I know.
>> this is our watson ?
>> no, this bill is is is filed by senator averet from wacookay. On some of this, doesn't bother me that the other dealers and tceq and market marketing, but it does bother knee exclude counties counties. Where wount--wouldn't we all do it? Another thing, I知 not sure about the $5 million per year limit, per air quality project. That's in the bill ?
>> yes, sir, it is. If there is extra money in the lirp program, right now there's currently $80 million in the lirp fund. It's to get rid of this excess money by giving the counties an opportunity to do other air quality work.
>> this is exactly what I remember us talking about when shell en erk was talking about this thing. This is the typical thing what happens with the state when you fund a program and before you know it it is a slush fund. When you have $80 million and the dollars are sitting in an account waiting for somebody to come up with some creative way to go, hmm there's $80 million bucks. You know, I would be supportive of this if we were going to be assured that those lirp dollars were dollars that we could use. If the we are getting into mandatory electronic, you know, automated disbursants of these funds, I mean, that's fixing to be an un unfunded mandate. That's fixing to be a deal where you guys take the thing on and we better watch it because if we don't, I mean, that's exactly would what we are going to have coming down the pike pikeCommissioner, the bigger picture here, Texas has severe air quality issues, as I know the court is very aware. This bill also addresses increased funding four terp and I think generally we are very supportive of that increased funding. The problem that has resulted in there being a lot of money left in that fund, and I believe there's about 200 million all together because there's a lot of unexpended terp funds as well, is not necessarily related directly to this program. There were a number of funds in which the legislature chose to leave unec pended balances in order to meet the necessity of balancing the budget during a previous legislative session.
>> right.
>> that's why those dollars, a lot of people believe those dollars were there. With lirp specifically, I think there have been some difficulties in figuring out a program that enabled people driving very old cars and who may be driving very old cars because they could not really afford new cars, to take that old car and put them in a new car that this person was able to, you know to make work financely or economically--financially or economically. So there are some issues, you know, like that that have probably had to be fine tuned. The bigger picture has to do with the way the state legislature through the appropriations committee and the finance committee used these balances to get our number that we needed to balance the budget.
>> but chris, I mean, and I値l let this thing go, the education of this and the whole lirp program is something that most people don't even understand. I mean, one thing that is easy to understand, for a grand, if you have a clunker you can't get out of your clunker for an extra grand. I知 not sure can you get out of your clunker for an extra 2500. I mean, so what you have got is that really isn't working at that level. I think there's a lot more explanation that needs to be gathered so in a bumper sticker you can tell us, here is what this thing is.
>> my motion is to support this approach but also to support any changes recommended by the clean air force and the clean air coalition, both of which will have this on their agenda very soon, along with our encouragement that we communicate our position and theirs to the sponsor of the bill as well as other senators and members of the Travis County delegation. It's one of those programs, I think, that can do a lot of good of there is pollution , there is auto generated pollution that takes place outside this program. Right ?
>> yes, there is.
>> yeah, that's the thing of I think that for us to have impact we really need clear anne force and coalition, which rents a whole lot more counties than just Travis County. My motion basically is for us to support this approach, we ought to get these ideas to those two groups and get their support. They may have tweaking recommendations, and if so, support those. There is a second?
>> second.
>> mr. White.
>> thank you judge. I just wanted to interject a little bit. One of the cleengroups we're working with is Texas clean air working group, which is a Texas decidewide group.
>> working with them too ?
>> that the correct. They are talking about some elements that we need amendments here. We are speaking with them. There is going to be a hearing on Thursday and we need to have somebody, perhaps either submit this in support of the Travis County position or perhaps even to present testimony at the hearing.
>> in advance of those meetings, are you asking for a vote from us so that we can put in a card of support for the amendment for Thursday ?
>> yes, I think so. I think the Commissioners court is already on record in support of the bill. I don't think it's unreason unreasonable to look for some minor tweaking amend amendments. That's essentially what these are. The basic fundamental concepts of the bill is something that the Commissioners court has already expressed support for. These are fine tuning issues and I think we do need to get them corrected.
>> will there be, is the hearing on Thursday strictly hearing, no voting to amend amending ?
>> usually that's the case. This is in the senate natural resources committee of which the author of this bill is the chairman. Usually they lay the bill out, have public hearing, and then leave the bill pending until a subsequent week or two at which time they bring up amendments, roll out a substitute, and then vote it out. Normally it would not occur on Thursday.
>> so we have the luxury of waiting a week.
>> right. I think it's important, though, if we have someone available to make these points, certainly by letter, and maybe publicly, and I very much appreciate the point. This is a very good bill from I think all the groups that you mentioned, judge, perspective. The court has supported this bill. These are minor in the scheme of things points that we think would improve the program.
>> somewhere in this letter we should say Travis County has worked with the terp and lirp programs over the last, they have been in effect two years or four ?
>> terp for a number of years. Lirp is just there our second year.
>> terp for 15 and lirp for the last four or five and these changes to this bill is welcome. However, we would like to recommend several minor changes.
>> correct.
>> something like that I think. But can we authorize this language but any additional language that comes from the coalition and the air force and then try to work in conjunction with the Texas clean air association ?
>> Texas clean air working group.
>> working group. Where is that radical--i mean where is that group from ?
>> they are statewide. Their offices are right across the street here pretty much. So--
>> we certainly want to work with them then.
>> the testimony for that group on Thursday will be presented by judge adams from ellis county, dallas area.
>> okay. Then my motion gets a second second?
>> yes.
>> is that friendly friendly friendly?
>> uh-huh.
>> discussion? All in favor? That passes by unanimous vote. This is our agenda for the clean air agenda tomorrow and clean air force at their next meeting.
>> if not it will be brought up under other business.
>> okay. Is that all on this one? Thank you. Appreciate it. Let's skip down to the next one which is h. Draft bill relating to the collection of a parking fee for maintenance of designated parking facilities.
>> yes, judge. As you know from last week, we had submitted some language just to get the ball rolling but we are waiting on approval from the court to take any further action.
>> I thought our position was pretty much that if you are a vendor at one of our facilities and you charge parking, we get part of it. And the way we covered the parking, we charge an admission fee at most of the parks. When there are organized sports, what the groups charge are entry fees, et cetera. I think we get whatever cut we contract for out of that. So it's not a direct parking fee bill. I mean, unless there is a motion for one. Where I知 headed is, let's just keep doing what we have been doing. Our lawyers tell us that we are on sound legal feeting feetingfeet--footing. Soundmay be in very very small letters.
>> I don't know if I used that word.
>> we are on footing. So if a vendor comes in and the big ones who expect thousands of people, charge the parking fee, and we contract to get a take of that parking fee that they collect, which is a little different than our being out there collecting the parking fee ourselves.
>> so that would take, I mean, that would take a certain, or a bill of itself if we wanted to do that because counties, is that right, because counties can't do that, john ?
>> there is no official statutory language that says a parking fee can be collected at an arena or venue similar to what we have right now.
>> do we think that that would be something that if we wanted that, that everybody wouldn't be supportive of that? I mean, if it was, if you wanted to do that? I mean, what county would not want the ability to do that?
>> I知 not aware of any opposition.
>> I don't think you want to do that, if the facility that comes to mind, really county parks outside the ex expo center.
>> we just identified which ones we would want to do. I am not saying we would for every one but it may give us the abilityi don't think we ought to do it, is my own view. I think that we want to generate revenue, we ought to just charge an admission fee.
>> that's fine with me as well.
>> every time I park at a city of Austin parking meter downtown, that position is reinforced. Anything else on this bill ?
>> on, as far as the increase, renegotiating a contract.
>> for the larger users.
>> routine always does.
>> contract more than the bill.
>> right.
>> I just want to be sure.
>> where you have thousands of people, you make money. Where you don't, you may well go into the hole because somebody has to collect.
>> I値l bring that point up.
>> ist, house bill 937 relating to an exemption from the payment of a toll for an authorized emergency vehicle.
>> I guess I will represent all the dents on this one. Right now it's kind of convoluted the way the law is written, that the sheriff or whoever is in in charge of the deputy using the facility would have to verify that the deputy was on duty and in some official duty while they used the toll road. Basically what this bill allows is any marked, actually marked and unmarked police vehicle would be able to use the toll road without pay. Just straight up, if you have an emblem, light bar , police unit, you are excepted from the toll. I think it's probably a lot easier to add minister this bill than the current one.
>> we don't believe any of our dentist would be out there joy riding on these toll roads. They are out there, we think it will be official business.
>> well, yeah. I think even the lost revenue is probably not significant relative to the total revenue of the toll authority. So I just don't think it's worth trying to track official and unofficial. If they are out there, they are probably on duty somehow or other or getting to duty.
>> I think it's practical to ask that about emergency vehicles. I just don't know how that interfaces with the bond sale, I mean, because I know that that is one of the issues that, I mean at least 130, the tta facilities, because the bonds were predicated on if you drove on them, you were going to get charged. If there's a way that we can get around that I think it's a great idea. I mean, more power to us if we can ask that because I do think it's practical for to you have your emergency vehicles, what they have lights on or whether they don't using the road. If we can pull that off, then great.
>> what's other counties doing with the same type of situation ?
>> they are subject to the same laws as we are, the same law the way it's written. And what Commissioner dougherty was speaking to was the way the bonds were sold for toll roads constructed in this central Texas area, three in particular, sh 45 north, loop 1 north and sh 130, those bond were sold with the stipulation that the exemption would be for police vehicles, basically, in duty.
>> pursuit.
>> so the wording is kind of you know, not very clear.
>> yeah.
>> I think, quite frankly.
>> we believe that governmental emergency vehicles ought to be exempt exempted. Period.
>> that's what this bill does.
>> because they do in the leashly take the toll. If they are on there.
>> there's a greater public good being done.
>> in addition, many counties have contributed significant dollars to these public transportation projects. And if you want a footnote s sh 130, tract's 90 million plus contribution, that would be appropriate too. I think a nice letter like that, if anything persuade them, that's what I would do.
>> but my question still, I asked the question. The question is this, what are the other counties doing that have tolce, such as dallas and harris and other counties in the state that have tolce when it comes to this type of situation. What are they doing as far as dealing with this situation? As far as emergency vehicles or anything else on the toll toll? How are they dealing with it sphthat's my question.
>> let me see. Do I understand right that in dallas they don't have the same bond language? Is that the issue ?
>> that's correct. Commissioner, lets me see if I can explain.
>> explain it to me.
>> the law, dollars and everybody else the way I understand it is under the same law that we have. That law can be read broad enough that a police vehicle not responding to a particular incident, a law enforcement vehicle is going through. I would suppose by what I am hearing, in dallas they are actually not being stopped, not being charged. The difficulty, what makes us different from dallas, is that when they issue bonds here, in the bond documents, they were very specific in their bond cov flants to the bondholders, the bond buyers and holders, very specifically as to who would be exempted and who wouldn't or at least a lot more specific. That's the hold up. Not so much the law, although this will make it more clear that it's available, it's really going to be, I値l worried, a bond covenant issue. So that's why, and I haven't researched myself. This is from listening to the conversations. I think that's where the fight is, in the bond language.
>> okay. I知 sorry.
>> go ahead.
>> no no, go ahead.
>> in regard to the bond language, and this is one thing that raises concerns for me, of course the bond language would, because it is a document strictly for the generation of income, of course they would say nobody is going to be exempted. But now the rubber is meeting the road and reality reality. Of course, there are other provisions in the bond document as well as the debt service documents now being revisited because reality is striking, such as the non noncompete clauses. And so I think we are just in the natural process of bringing reality to bear. And I think the reality is the enforcement cost of having to verify that each emergency vehicle was actually on an emergency call, is, the reality of that is far too brurden some for everyone involved, and I think this we are just simply realizing that. Not to mention the fact, is this number correct, 244 million combined between county for the contribution of right-of-way to tex dot? I think they are realizing that we deserve the benefit of the doubt.
>> we anticipate delivery of that letter next week. So the court can look at it and approve it. Right?
>> thank youwe'll will have it back on, joe.
>> thank you.
>> j, added item, house bill 345, relating to the collateralization of certain public funds.
>> good afternoon.
>> good afternoon.
>> I知 mare may, investment makinger for Travis County, your treasurer and I are here to speak and make you aware of this bill, hb 345. I have been working to understand this bill on behalf of the government treasurers organization of Texas. We have found a number of graves problems with the bill. What it does is amends the current collateral law that we are under. As you know, that law sauce that public funds deposited in a bank in Texas must be collateralized. And of course we follow that law. The idea of this bill is to provide another, a different alternative way of providing that collateral. And the controllers office would be authorized to set up a pool or pools. In generally, it sounds like a great idea. Let's put all the money into one big pool, you know, you can have more on Tuesday and I can have more on Wednesday Wednesday. The entire amount needed may be less, and that will be beneficial to all the banks and the government entities as well. Unfortunately, that's not what this bill says. It was written, prepared with the cooperation of the banking industry, and understandably, it mostly looks at their side of the collateralization, and it does not look at the government entity side, which is to provide for the safety of the public funds that we are responsible for. I have a number of examples here. The first one is that the bill provides for 102 percent of the deposits that the public entity has in the bank . Travis County always has at least 110 percent, and during tax season, it goes way up because we are not sure when we might have a spike in the deposits. And 102 percent would not serve us well because we would end up being under collateralized on days where we got more money and than we were aware was coming. The second large problem.
>> our experience has been that--
>> pardon ?
>> our experience has been that 110 percent is more appropriate for us than 102 percent.
>> 110 percent is appropriate for us except during tax season. Then that's not enough.
>> for the average voter, that eight percent is not over collateralization because--
>> it's not overcollateraliz overcollateralization ?
>> the difference between 10 102 and 110.
>> yes. We put that there for a spike, for the increase of revenue coming in. And so we allow for that so that Travis County does not get written up for under undercollateralizing the public funds. We would rather be over overcollateralized at any time as opposed to be under undercollateralized. That means should the bank close, we are get going to get our money plus eight percent or whatever that we need. And let me explain that the bank has to know by noon what collateral reneed for that day. But we continue to get deposits and to make those positive its in the bank until close of business for the bank. So we cannot know until it's too late to get collateral, the level of deposit that we need to collateralize. So that's the purpose of that cushion.
>> so this bill, which only allows for 102 percent, would leave us hanging eight percent. And then that's not even tax season when the revenues come in during tax season, of course, we increase our collateralization to cover the 50 million that came in yesterday for today, that time of thing.
>> so 22 is not a minimum, it's a maximum.
>> we don't know because the bill really doesn't address it. All it says is 1012 percent.
>> okay.
>> that's--102 percent.
>> that's one of our problems as well.
>> okay.
>> the next problem is current cat recall law provides that accrued interest, which should be ours if the bank fails, will not be collateralized anymore. Currently the collateral law provides for collateraliz collateralizings accrued interest. This bill would take that away. You know, that part of public funds would simply not be protected. There is an investment form called a securities lending program. You buy securities and then you lend them out and make at bit of extra interest on them. Detail t would be concern that if that were used on the collateral, which is to be the controller's office is to have charge of the collateral, then the collateral might not be available when we needed it at all. Or it might be delayed. So that's another problem with the safety of our public funds.
>> and that's from the perspective of the cities, municipalities. The counties wouldn't have that. And mare rents the governor governor's organization of Texas which includes municipalities, isd and consolidated school district as wellve we have another perspective, and that is the county, which we are concerned with.
>> there is concern that our collateral might not be secured as well as it is right now. Right now the county collateral is held in the federal reserve bank. They notify us, okay, you have this much more than you ask for, or you ask them to release and we have done that, and we have assurance that that is pledged to Travis County. If the controller takes control of it, then we are not that sure. In particular, the current law, this is from the new bill, the controller by rule shall regulate a custodian under the pooled collateral program in the matters provided by subchapter c, which is the current law, to the extent possible. I'm sorry, but all have you to do is to say, oh, that's not possible, you know, this isn't good, we're not going to do that. It substantially weakance the current law that we have about collateral. Finally, reporting, all of the reports that the bill talks about are to be sent by the banks to the control controller. We would get nothing. We would not know what was going on with our collateral collateral. Right now we getting daily reports, market daily reports, we have a lot of information so that we know, and our auditors when they come in and audit us, know what we have. And under this bill, the controller would know, we hope. Anyway, these are just some of the weaknesses as the bill is now written. I would urge you not to support it. Gtot has been trying to work with the bankers to make some changes, put in some amend mentsthat we could agree to that would give us some of these protections. So far we have not succeeded in that, and I don't have that to provide you today.
>> what would you recommend to oppose it ?
>> as written currently, yes.
>> do we know what position tac and cuc ?
>> tac, this morning at breakfast we discussed the bill and I laid it out for them. Inda reid is working with us at tac as well as jim ail listen said he will work on it as well. They will not take a stand but they will provide the information and of course re relay their support of the integrity of public funds, and that they will tell cuc and everything about that.
>> cuc will be boulder than that. I do think we ought to put together a letter that sort of in simply english explains the issues that we have with had.
>> yes, sir.
>> looks like somebody intended to do good but may not have done so.
>> yes.
>> from the county perspective.
>> right.
>> so should we read this as sort of implying that these banks would rather deal with the comptroller than counties ?
>> I personally think the bank hoped that it will be a cheaper way for them to get the job done. And I understand why they would feel that way of the but we feel that they are not getting the job done. Under this bill.
>> the document should indicate while while--why we think this is a worse deal for Travis County and other counties.
>> right.
>> reduce that to writing. That's what cuc will want to see. Call it to done lee's attention at the next cuc meeting and let him call it to the attention of the urban counties. Tuc has lawsuit so I why they would be a little more shy about getting involved in stuff like this. But you all are saying this is not a good thing.
>> Thursday we are meeting with tac and tac is meeting with representative linn's office and we are going over portions of this and hoping the educate them on like the county depository statutes and things of that nature that they were not aware of. And so, mariy said, it we gan as a banking bill. If they think it's going safe us money but it's not, the banks will be making the money and the county will be left holding the bag.
>> could we just retool this memo, mary's memo is very well stated, I think, in the letter to representative lynn.
>> right. Well, dolores and I just met yesterday on this. What we discovered, every time we look at this bill we find something else. There are some things not in this memo.
>> okay.
>> we need to add them. The hearing, there's not been a hearing and it has not been called at this point. Do we have until next Tuesday ?
>> they have way longer than that. Certainly until next Tuesday Tuesday. You mean for us to respond in yes, absolutely.
>> to get what we feel is better.
>> the bill is filed by the vice-chairman of the committee that the bill would be to be heard by or has already been referred to to. So I will be certain this bill will get full consideration in the house. Do we have a week? Yes. Certainly.
>> pardon.
>> if I had to comment about a certain section, would I say.
>> refer to the section that we have ?
>> yeah. Then we start sharing with a lot of people, I think it will make it easier for them to understand it.
>> one of the things the treasurers were concerned was with the auditing. I had asked susan's office to look at it from that perspective. Maybe mike can say something to that. Because I think that's the part that this whole bill leaves out any kind of over oversight from the state, of the state controller. If the they are in fact adamant that this bill will pass, then we need to the be sure that this language is in there to take care of that concern from the auditing viewpoint.
>> makes sense to me.
>> every year in our external audit one of the things the external auditors look at is did we comply with having the right amount of collateral. And the way this bill is written right now, there's no way for them to verify that. There's no requirement that anything be given to the county. The other thing that I thought mary's memo was excellent too, and the thing that it would probably be good to add, because this bill talks about it being optional, but the reality is and I think probably you all would both agree, the banks right now hate the way they have to comply with Texas law on collateral. It's too expensive for them. And so it makes sense to try and come up with a way to pool it. Other states have done that too. But the reality is once that law is in place, I would be very surprised if the Travis County would be able to find a bang that would provide collateral under any means except for the pool. In other words, you will not be able to find a depository that will provide collateral the way they are right now. That's going to take some other authority away from you as well, that you have right now. For example, in your investment policy, you describe the types of collateral that are, that you will accept as the types of collateral. Those are aren by the state law on collateral but you can choose to liven nate some types of collateral illegal in the state of Texas but you don't think are appropriate, you would not be able to do that if you are using a pool. The comptroller is going to make that decision on what collateral is acceptable at well. There are some other things like that. But the key thing is even though this is presented as an optional thing for banks to do, you're going to find that it's not going to be optional, you're not going to be able to find a depository that will provide collateral the way they are right now.
>> the banks who bid on our contract at the last time we did that are very much in favor of this bill.
>> sounds like you will probably have a grocery list of problems, rolling problems week by week with this bill.
>> we came up with almost four pages of questions and concerns, which I tried to boil down in this memo, know know. But yes, there are a lot of things.
>> it might be appropriate to have a rolling commentary provided to representative flynn and to the delegation. I imagine that the banking industry will be making a rolling commentary as well.
>> probably.
>> we can roll one week.
>> okay.
>> try to approve something, look at it. If you all incorporate mike mike's points there.
>> yes, thank you mike.
>> our goal is for the vice clean air to see what we perceive to be distinct disadvantages of the bill.
>> right.
>> okay. We'll have it back on next week.
>> thank you.
>> on k, kimberly peer suggested that we pull this, says she is still reviewing it. K is the matter involving 9 934 and senate bill 437, ignition interlock. It will be on next week unless somebody has something today. Anything in generally regarding slative issues? You all still having fun ?
>> I feel like where we are on the billboard, bill 137, I still have some concerns on that, especially in those areas, the unincorporated areas of Travis County that need to have some attention brought to it as far as billboardsyes, I am looking into--
>> yes, I am looking into the bills that you had mentioned earlier and will get some information to you as soon as I have it available.
>> okay. Let's see what we can do on that.
>> recess until 1:45 or 1:30 1:30?
>> 1:45.
>> move that we recess until 1:45.
>> second.
>> all in favor? That passes by unanimous vote with Commissioner dougherty off the dias. Dias.
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Last Modified:
Wednesday, February 28, 2007 8:20 AM