1982-07-07 Regular Meeting and Public Hearing

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• • Minutes, Regular Meeting and Public Hearing La Porte City Council, July 7, 1982, Page 5 • issued will be in the event that you want to issue additional bonds under the trust endenture which you can do for the pur- pose of completing the project or expanding, or even refunding the bonds if there is a change in interest rates. Or the corporation may be asked to join in amendments to the loan agreement by releasing some property that is being held as security, but I think it's safe to say that the corpora- tion's actual involvement up to the time of the bond issue is probably limited to review by its legal counsel to make sure that everything's on track and then the actual signing of the documents and passage of the resolutions necessary to the issuance of the bonds. Gay: What if the recipient of these bonds should go into default? Lyons: The important thing to remember is that these bonds are not obligations of the City. Statuatorily they can't be obligations of the City. The incorporation papers of the IDC • clearly state that they are not obligations of the City. Our bond documents clearly states that they are not obligations of the unit which creates the IDC. There are limited obliga- tions of the IDC itself only to the extent of those revenues. The legal documentation under which the bonds will be issued will make it clear that is is not the City's debt. Malone: Will the eligible blighted area in any way interfere with our zoning? Lyons: No, that is only a term of art used in the context of the corporation and the rules that relate to it. It has no legal meaning outside of that. The City Council will give next to the final decision. The way it works is, the City Council says this is the eligible blighted area and they file their resolution declaring with the Texas Industrial Commission and the Commission has 30 days to comment on it. If they make no comment on it, then the EBA goes into effect. To my knowledge, there have been a pretty good number of EBA established, and I don't think the Commission has commented on any of them at all. Matuszak: Is there any way any industry could take advantage of this without the approval of the governing body? Lyons: No, the statute requires that City Council approve any bond resolution of the IDC. •