Travis County Commissioners Court
September 25, 2007
Item 53
I see you are eagerly anticipating that we will go to another item of yours. Must be number 53. Which is to consider and take appropriate action on request for alternative funding for east service center. We indicate here the matter may be taken into executive session for consultation with attorney. If we need to do that, we will do it this afternoon when we convene in executive session to discuss the other executive session items. Okay?
>> all right. Joe gieselman with tnr, rodge elkhoury, facility. We embarked on the ease service centers, a consolidation of roadage bridges offices in pre--precinct 1 and 4. When we mapped this out for the court a couple years ago we were going to use any number of different funding showers. One of those was road and bridge fund. We were going to use those, actually have used the road and bridge fund to construct the horizontal improvements which would include the driveway, parking lots, stormwater drainage from the facility. We actually proceeded down that line. The buildings of course were being done with general fund or debt. And that was, they were being done by, through roger's office, facilities, and they are currently under contract and under construction. We got to the point where the interpretation of the law became an issue on whether or not, what the tnr was doing with the workforces was eligible under the road and bridge fund in the law. The auditor asked for a written legal opinion on that. And upon further research, the county attorney made a determination that there was no explicit authority that allowed tnr to use those sources of funding for that purpose. There's probably more that can be said on that. I expect you will hear on that in executive session. With a it amounts to, we have about $2.6 million that meads to be covered by alternate funding sources because the money that we have used to date, money that we have encouple berd from the road and bridge fund to pay for thesthat is that are almost ready to launch, and next year we envision use of future road and bridge in fy '08 to continue the process of constructing it. We have gotten with pbo in the last two weeks and I think through working with pbo have found some alternative funding sources that are eligible for this purpose. What we are asking the court to do is approve those alternate funding sources. I will ask jessica if she is available to outline where those founding sources would come fro.
>> jessica, are you available?
>> I actually met with tnr yesterday. There are two parts of the 2.6 million that joe is referring to. The if first part is a million 65,502 which we understand need to be reclassified in fy '07 and we are hitting the end of the fiscal year. That is the first part of this. The rest we can talk about in a little bit which is the 1.6 million. We have a proposal for the million 65,502 and there are members of the auditor's staff and county auditor here to discuss the reclassification but pbo's initial recommendation to tnr was to take those transfers and get authority today from the court to do automatics within their budget and transfer, basically, transfer out any remaining balances that we had projected, which totaled 585,000. However, in further discussions with the county auditor's office and in order to expedite this action because we do realize it needs to be reclassified this week so that we can hit fy '07, we would recommend that the entire amount come from the fy '07 allocated reserve which currently is $1.7 million. What that will do is in effect free up $1,650,502234 road and bridge funds in fy '07. As you know we adopted a budget for fy '08. We do not have any additional revenue estimates coming for that money. However, we are recommending a second reclassification, if you will, from fy '07 co's into the road and bridge, the freed up balance, basically. So that we can at least utilize that money in fy '08. I think our first recommendation in order to proceed with the fy '07 reclassifications which must occur, is to reclassify a that amount into the generally fund and that would necessitate a budget adjustment from the general fund allocated reserve into tnr line item 45514912288105 to be given the authority to us to do that as automatic or if that is not the right line item to do it into the appropriate line item this week.
>> so what you are suggesting, what the million come from allocated reserve?
>> 1,065,502. I was indicating that is the current reserve in the allocated fund. I can reserve.
>> the notion is fairly simple. You spend a million bucks out of red money. What we do is we use general fund to reclassify those expenditures as general fund. That freed up a million of blue money. That is road and bridge. Then rather than borrow for h mac you use the rode and bridge for h mac which is perfectly legal and appropriate and historically consistent approach. It's kind of sort of maybe last minute because we just learned about it shortly a few moments ago literally. But that is one approach for the immediate problem of '07 expenditures that were made, that sort of shouldn't have been. Then we have the other issue of the remaining expenditures in '08. I have a suggestion for you.
>> can I ask this question. The 1.7 projected for allocated reserve, was that part of the year-ending balance smyes.
>> we have to reduce year-ending ball by a million and 65,000.
>> maybe, maybe not. As you are aware, the ending fund balance pbo, we project the expenditures, the auditors office projects the revenues. It's not unusual for those estimates to be off. They could be off as much as a million dollars. That is not unusual. And so what we would proposed--
>> you will know that Friday morning? Post for Friday morning at ten. Final claims for '07. Will we know the impact of taking this from allocated reserve by then?
>> we really will not know until the county books are closed. Those are really closed after the last payroll. And that's sometime in October. Once the county books are closed the auditor closes the books, and we know the effect of the million 65,000, if in fact we do not have enough leeway in those project shuns to cover that, what we would do is the following Tuesday come back to Commissioners court and recommend that you allocate either from allocated reserve, car reserve for the balance that we need to conversation. In the past years we have been more conservative on our estimates and we are thinking that perhaps we will be able to cover that.
>> part of it is. The hard close of the book is about the middle of October. We will know all of these things definitively then. Now we are estimating. Departments were still making requisitions of last day for that was Monday. One of the bind in the budget is all of us in the number game would like this to be rail solid and know what we are doing. By the same token departments keep doing business. We try to keep the books not moving for as short a period of time as we can. You know, business has to go on. And so what leroy is exactly right, I mean, we'll have more of a feel. Can we name--
>> by when?
>> budget transfers? We're going to have a pretty good idea Friday. We'll have a better idea. We're sitting there trying to figure out what is in there, what is encumbered. You know, I mean, we're talking about thousands and thousands of transactions, particularly at the end of the year. There's nothing wrong with that because people, a lot of times, hold back until the end of the year to make sure they have enough money and don't run short. Nothing wrong with that but a lot of activity at year-end.
>> that is the reason at pobe--pbo we had initially recommended and tnr agreed that we would come up with all the balances and use that to transfer into this building account that the auditor has proposed to use for this transaction. However, their accounts are moving at the same time as all the other accounts. And to expedite the process, what we would recommend is for the court to allow us to do an automatic budget transfer for that amount into allocated reserve into tnr's general fund building account so that the auditor can go in in tnr and do the reclassification of those road and bridge funds prior to the end of the fiscal year. And we think that would be the most expeditious way to handle this transaction.
>> it would enable us to do in a timely manner, I guess is the simplest at this late date.
>> yes.
>> if response to the question I really wanted to ask, there's no reason for me to the be concerned about taking this money from allocated reserve at this point.
>> that's correct.
>> the remaining funding.
>> yes.
>> you have--
>> I move approval of that part first?
>> second.
>> yes.
>> let's do that and not worry about it. Any more questions about it? From the '07 allocated reserve. All in favor. That passes by unanimous vote. Thank you.
>> now you have '08. Everything will be done according to hoil in '08. So however, what I'd like to do is put this in a larger context which mr. Gieselman may have insight in but is not a part of his backup. As part of the budget process, you did not address more than $9 million worth of capital projects that it is entirely conceivable that you will want to address. Precinct 2 building, east side ff and s and galt, other Austin property and renovation. Each of those appear on your budget agenda worksheet and were not addressed. We do not have fund sources for them. We will probably wish to have fund sources for them. When this came up of another million six, you can add that million six to your capital challenges. Frequently you addressed co funded activities. In late October, early November. You have may wish to expedite it because life goes on. And this east side project, not only that but negative --negotiations for property are continuing. And we have a bit of a disconnect between fund source identification and some of these projects. Just 20 minutes ago you were discussing tiberon. That's a 2.6 million item currently in the co that we may wish to fund partially out of car and partial out of a c o. There's a lot of discussions that have to occur to connect some dots and to have them all done at once has great benefit. So the Commissioners court can say, here is our capital program. And let's go execute it. Rather than do it on an ad hoc basis every Tuesday, another issue comes forward which makes everyone cranky. Or at least some people cranky. Certainly makes me cranky.
>> none of us claimed that, christian. Not one of us will .
>> where we disome. Get the auditor involved to make sure the contractual obligations we don't all of a d d e te, yoha n intie e llndg ma su ou oor hhe ofbte whe u ilno s vor predonin ye sir ose ipwa tipaicarojt ic our fothlahr .anis that one accommodates to that.
>> makes sense to me. May well circulate an October calendar, try to figure out a convenient, earliest convenient Thursday afternoon to have a work session.
>> also wondering if we can get a list of all the capital projects so that we can consider it beforehand. Eswed t h thf oi mcayou are comfortable with what all the implications for all the capital projects, and then we can go forward and execute.
>> okay. Otherwise the 1.6 will wait at least another three, four weeks.
>> is that acceptable to tnr?
>> 416,000 needed in October?
>> donald ward, tnr. One of the projects we have going on as part of this ease service center a curb be and gutter, one of the critical things that you have to construct as part of the roads and parking lot. To basically lay out the edges and go forward with the base material and the asphalt material, you need this as a step one. We're ready to award that contract. In fact, we were ready to award it this week. It's very critical path for us to do that. And so, that would definitely have some affect on it. Basically what we are looking for there, close to 300,000 for that. 91,290.
>> curb and gutter is not eligible for road and bridge funding either?
>> I thought it was.
>> we could talk about some of the factors. I need some more discussion on what we are talking about.
>> okay. If we can get bond counsel information on internal legal opinion?
>> bond counsel wouldn't have to comment on road and bridge funds. They would not comment on that.
>> let give him the facts by this afternoonokay.
>> .
>> we need a mental shift regarding eligible road and bridge fund projects, looks like. We don't need another lawyer, john, we need a mental shift.
>> some of this is account zng the road and bridge fund fund two things by law, roads and bridges. And that is what the law says. And we try to follow the law on that like everything else. Secondly, we have to send a report through the come troller's office where they make sure that we're only spending money for roads and bridges here. So the truth of the matter is that we don't think a parking lot is a road or a bridge. The driveway into the parking lot we don't think is a road or a bridge. In our very simplistic view, we don't see how you can use road and bridge funds. If the county attorney writes an opinion saying that is a road and the comptroller office's says it's okay for you to pay that, then we will. But in all honor esty, it's that simple.
>> yeah. Seems to me it should have come up in Texas numerous times before. Wherever it lands is fine with me.
>> this has been in discussion for quite some time, judge.
>> if you have to build a bridge across, I mean, with an entry road, does a bridge only qualify if it's out a public road?
>> that is where the facts, that is--
>> I don't know that. But it is a question of facts. And if the fakes --facts say it's a road or bridge or not. Normally a parking lot attaches to a building, it's not part a road. Wheer is what it says. Here is the law. Money in the road and bridge fund of the county may be used only for working public roads or bulling bridges. Except as otherwise provided by law.
>> so when he say we immediate to restore--
>> that's right. If I get a written statement from the county attorney, since I have to put my name on the report that we send to the comp troller, that this in fact under the law, 256.001, is in fact a road, I don't have a problem witness. Then the comp troller says yeah, we agree with that. That is what I need. We're trying to get around that.
>> the county attorney might be interested in talking to his counterpart in dallas. Since road and bridge funds in dallas are used for things other than roads and bridges. That I believe has been accepted by the dallas attorney as consistent with the otherwise clause in the law. There might be some lawyering that needs to be done and you will hear about itone.
>> judge, one thing you might want to know, this roadway was designed for traffic conditions, has gone through geotechnical mall assist and is a structurel roadway built to that effect based on criteria for surb divisions and roadways.
>> where we land is fine with m.
>> it is a factual question.
>> . We may have been too general in our interpretation historically.
>> if I may, cynthia mcdonald, tnr financial services. We also did contact the comp troller's office regarding the report. Just to clarify, there are other things on the report besides road repair and maintenance. There is another line item and it is acceptable from their standpoint to use road and bridge funds for other expenses related to road matters. They were specifically interested in the lateral road distribution but we account for all of our road and bridge funds because we don't separate the lateral road fund distribution. So when we report, we report all of our road and fund expenditures and they have not questioned the other line item which is over a million dollars on an annual basis. We have actually gotten a written confirmation from them that however we do the report, as long as we are within the statute, they are fine with that. We can report other expenditures as long as the attorneys and everybody else agreed that it is meeting the statute.
>> we have asked for that in writing. Our office does not have it. The real question is, does it meet it if. If it does, fine. That's all.
>> based on where we land here, we may need 300,000 plus dollars in October is what I am hearing.
>> yes, sir.
>> so the contract will be on the court's agenda when?
>> we anticipate it to be on the court's agenda today, but this topic preempted it, sir.
>> today?
>> it will be on the court's agenda when?
>> next week. If this goes favorably.
>> bring that legal issue with you when you bring it. We'll foe what we have to do.
>> is there any sense to discussing this in executive session further? Have we covered all that's necessary to move forward?
>> we will have an executive session discussion with john this afternoon.
>> okay.
>> I anticipate we might want to do that. We indicated we may get some consultation with attorney. I don't know that we can land on this specific 300,000 plus. We can certainly get legal opinion on it preliminarily and more next week if we need to. Yes, sir.
>> I want to make the court aware of two things the buildings continue. So we have not, because we can't we're under contract. So those keep going on. Even though we might not have access to those buildings. Depending how this is resolved. The other issue is the ruling here has a greater consequence than just the road and bridge east service center. We were also going to do park roads and parking lots serving other county facilities as well as road and bridge funds. And if the ruling is we cannot use road and bridge money for that purpose, have you the allocate at some point, and you have all indicated this year some money for those purposes. But prospectively, all those type of improvements will have to come out in in the general fund.
>> on park roads, public rosa?
>> depends on how you look at that?
>> that will be this yeek.
>> those are going to be pac questions that john and I will be having to meet.
>> yes, in addition to what joe was saying, the road improvements were for parks and some of the facilities roads funded through co's but those are major improvants. It does not cover day-to-day maintenance and repair.
>> this will have bearing also for other counties potentially since dallas pays for sheriffs deputies out of its road and bridge funds. If we cannot pay for a curb.
>> that--
>> I understand. Using road and bridge funds.
>> that would not surprise me.
>> I am surprised every week.
>> joe, we anticipated our discussion with you this afternoon. Move that we recess until 1:30. All in favor. That passes by unanimous
The Closed Caption log for this Commissioners Court agenda item is provided by Travis County Internet Services. Since this file is derived from the Closed Captions created during live cablecasts, there are occasional spelling and grammatical errors. This Closed Caption log is not an official record the Commissioners Court Meeting and cannot be relied on for official purposes. For official records please contact the County Clerk at (512) 854-4722.
Last Modified:
Wednesday, September 26, 2007, 18:30 AM