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HomeMy WebLinkAboutPR 16689: PORT OF PORT ARTHUR PUBLIC HEARING REGARDING ISSUANCE AND APPROVAL OF PORT OF PORT ARTHUR NAVIGATION DISTRICT OF JEFFERSON COUNTY, TEXAS interoffice MEMORANDUM To: Mayor, City Council, and City Manager i From: Valecia R. Tizeno, City Attorney Date: September 16, 2011 !!!///"""""" Subject : P. R. No. 16689; Council Meeting September 20, 2011 Attached is P. R. No. 16689 authorizing the Mayor or the city Manager to attend and conduct a Public Hearing at the offices of the Port of Port Arthur, 221 Houston Avenue, Port Arthur, on October 6, 2011, at 9:00 a.m. regarding the issuance and approval of Port of Port Arthur Navigation District of Jefferson County, Texas Exempt Facilities Revenue Bonds (TOTAL Petrochemicals USA, Inc. Project), Series 2011A in the aggregate principal amount of $150,000,000, as per 26 UCS, Section 147. VRT:ts Attachment Cc: Scott Sheldon SHELDON & DUNHAM, PPLC Gregory B. Salinas MCCALL, PARKHURST & HORTON, L.L.P. s.pr16689 memo P. R. No. 16689 09/14/11 is RESOLUTION NO. _ A RESOLUTION AUTHORIZING THE MAYOR AND OR THE CITY MANAGER TO ATTEND AND CONDUCT A PUBLIC HEARING AT THE OFFICES OF THE PORT OF PORT ARTHUR, 221 HOUSTON AVENUE, PORT ARTHUR, ON OCTOBER 6, 2011 AT 9:00 A.M. REGARDING THE ISSUANCE AND APPROVAL OF PORT OF PORT ARTHUR NAVIGATION DISTRICT OF JEFFERSON COUNTY, TEXAS EXEMPT FACILITIES REVENUE BONDS (TOTAL PETROCHEMICALS USA, INC. PROJECT) SERIES 2011A IN THE AGGREGATE PRINCIPAL AMOUNT OF $150,000,000, AS PER 26 USCS SECTION 147 WHEREAS, the City Council of the City of Port Arthur finds it to be in the best interests of the citizens of the City of Port Arthur to authorize the Mayor, the City Manager and/or any Assistant City Manager to attend and conduct a public hearing at 9:00 a.m. on October 6, 2011, regarding the issuance and approval of Port of Port Arthur Navigation District of Jefferson County, Texas Exempt Facilities Revenue Bonds (TOTAL Petrochemicals USA, Inc. Project) Series 2011A in the aggregate principal amount of $150,000,000, as per 26 USCS Section 147, as more fully discussed in the memorandum attached hereto as Exhibit "A ". NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR: Section 1. That the facts and opinions in the preamble are true and correct. Section 2. That the City Council herein authorizes the Mayor, the City Manager and /or any Assistant City Manager to attend and conduct a public hearing at 9:00 a.m. on October 6, 2011, at the offices of the Port of Port Arthur, regarding the issuance and approval of Port of Port Arthur Navigation District of Jefferson County, Texas Exempt Facilities Revenue Bonds (TOTAL Petrochemicals USA, Inc. Project) Series 2011A in the aggregate principal amount of $1.50,000,000, as per 26 USCS Section 147. s.pr 1 6689 Section 3. That the City, by its approval of these bonds, shall not be liable for the payment thereof and that the sole parties liable therefore shall be TOTAL Petrochemicals USA, Inc. and /or TOTAL, S.A. Section 4. That a copy of the caption of this Resolution be spread upon the Minutes of the City Council. READ, ADOPTED AND APPROVED on this 20 day of September, 2011, at a Regular Meeting of the City Council of the City of Port Arthur, Texas, by the following vote: AYES: Mayor City Council NOES: MAYOR ATTEST: CITY SECRETARY APPROVED AS T 1 FORM: / ins .I VALECIA 1 A rN'1, CITY ATTORNEY APPROVED FOR AD I ISTRATION: STE E FI ZGIBBONS, CITY MANAGER EXHIBIT "A" EXHIBIT "A" LAW OFFICES M°CALL, PARKHURST & HORTON L.L.P. 717 NORTH HARWOOD 600 CONGRESS AVENUE 700 N. ST. MARY'S STREET NINTH FLOOR 1800 ONE AMERICAN CENTER 1225 ONE RIVERWALK PLACE DALLAS, TEXAS 75201 -6587 AUSTIN, TEXAS 78701-3248 SAN ANTONIO, TEXAS 78205 -3503 TELEPHONE: 214 754 -9200 TELEPHONE: 512 478 -3805 TELEPHONE: 210 225 -2800 FACSIMILE: 214 754 -9250 FACSIMILE: 512 472 -0871 FACSIMILE: 210 225 -2984 MEMORANDUM To: Valencia "Val" Tizeno Interim City Attorney City of Port Arthur, Texas Cc: Scot Sheldon Sheldon & Dunham, PLLC. From: Gregory B. Salinas McCall, Parkhurst & Horton L.L.P. Date: September 13, 2011 Re: $150,000,000 Port of Port Arthur Navigation District of Jefferson County, Texas Exempt Facilities Revenue Bonds (TOTAL Petrochemicals USA, Inc. Project), Series 2011A (the "Bonds ") The following memorandum describes the federal tax law provisions requiring the City of Port Arthur, Texas (the "City ") to hold public hearings with respect to the above captioned bonds as well as obtaining the approval of such Bonds by the Mayor of the City. The memorandum also discusses the necessary steps to hold such hearings. The federal tax law requirements and the process, however, are substantially identical to the actions required of the City in June of 2011 (as well as similar actions held in 1998, 2000, 2002, 2003, 2008, 2009 and twice in 2010) relating to the issuance of bonds by the Port of Port Arthur Navigation District of Jefferson County, Texas (the "Port") or its industrial development corporation for the benefit of TOTAL Petrochemicals USA, Inc. (the "Company "), formerly known as ATOFINA Petrochemicals, Inc. and Fina Oil. and Chemical Company, and/or BASF Corporation. The Bonds being issued to continue the financing of the on- going, major plant expansion of the Company. The Port will approve and authorize the Bonds pursuant to action to be taken by the Port on September 21, 2011. The Bonds will be issued to finance the costs of major improvements to the Company's existing plant complex, as described above, adjacent to the boundary of the Port, but 1 within the extra - territorial jurisdiction of the City . Also on September 21, 2011 and prior to the issuance and deliver of the Bonds, the Port will hold a public hearing regarding such bonds and the projects to be financed and refinanced with such bonds. The public hearing is a requirement of the federal Tax Equity and Fiscal Responsibility Act of 1984, codified as Section 147(0 of the Internal Revenue Code of 1986, as amended ( "Section 147(f) "). Section 147(0 requires that a public hearing be held within the jurisdiction of the issuer of private activity bonds, in this case the Port, and, if such facilities lie outside the boundaries of the issuer, within the jurisdiction (including extra - territorial jurisdiction) of a political subdivision where the facilities to be financed or refinanced with such bonds are located. Notice of the public hearing is required to be published in a newspaper of general circulation not less than fourteen days prior to the hearing. In addition, Section 147(0 requires that the highest governmental official of the jurisdiction holding the hearing, after considering the comments made at such hearing, approve the bonds. The approval is only for purposes of Section 147(0 and does not create any liability on the part of such official or the related political subdivision. Therefore, the Port, on behalf of the Company, is requesting that the City authorize the holding of the appropriate public hearings and authorize the Mayor of the City to approve such bonds after due consideration of any testimony at such public hearings. As stated above, Section 147(0 requires that the hearing to be held not less than 14 days after published notice of such hearing. For other federal tax reasons, the Bonds are scheduled to close on October 12, 2011. In the past (and as contemplated below), specific action of the City Council of the City has been obtained with respect to the hearing and Section 147(0 approval. If such prior approval is the City's preferred practice, it is requested this matter be placed on the September 20, 2011 City Council agenda. Attached is a draft resolution of the City Council consistent with prior years' resolutions. As in the past financings, because of the time frame in which to get the required notice published, it would be preferable that a time and date for the public hearings be determined prior to the September 20 City Council meeting. If such a time and date can be determined by September 15, 2011 for a hearing any time during the week of October 3, 2011 (subject to a mutually available date and time of the City and the Port), the publication deadlines for the Port Arthur News would permit timely notice in advance of the hearing. The location of the public hearing in the form of notice (is currently the address to the Port's offices). The hearings held in May of 2000, April of 2002 and 2003, May of 2008, March of 2009, February and December of 2010 and June of this year by the City were held at the Port's offices and the hearing this year could also be held there, but the hearings can be held anywhere within the City. As for the City Council meeting on September 20, 2011, the only action of the City Council would be the authorization for the holding of the public hearing, designation of alternate hearing officers, presumably the Mayor, the City Manager and any Assistant City Manager and authorizing 2 the Mayor's approval of the subject bonds for purposes of Section 147(f). The following is suggested agenda language: "Approval of holding certain public hearings relating to certain private activity revenue bonds to be issued by the Port of Port Arthur Navigation District for the benefit of TOTAL Petrochemicals USA, Inc., appointing hearing officers therefor and authorizing the Mayor to approve such bonds for certain federal tax purposes only." Scot Sheldon of Sheldon & Dunham, PLLC, the Port's general counsel, and/or Gregory Salinas of McCall, Parkhurst & Horton L.L.P., the Port's bond counsel, will be available at the September 20, 2011 City Council meeting to answer any questions. Additionally, we are available to meet with you at any time if you feel that is necessary, with reasonable notice. Also attached are the forms of the approval certificates of the Mayor with respect to the Bonds which, after the required City public hearings, the Mayor shall be asked to execute. If you have any questions or comments, please do not hesitate to call Scot Sheldon or Gregory Salinas. 3 PUBLIC HEARING NOTICE The City of Port Arthur, Texas (the "City ") will hold a public hearing at 9:00 a.m. on October 6 , 2011, at the administrative offices of the Port of Port Arthur Navigation District of Jefferson County, Texas (the "District "), 221 Houston Avenue, Port Arthur, Texas 77640. Among the items to be discussed will be the proposal for the issuance by the District of its revenue bonds to finance the acquisition and construction of certain solid waste disposal and sewage facilities related to a refinery expansion, including a new coker (the "Project "), which are located at the TOTAL Petrochemicals USA, Inc.'s plant site complex at 7600 32nd Street in Port Arthur, Texas (the "Project "). The maximum aggregate face amount of the bonds to be issued in one or more series is anticipated to be $150,000,000. The bonds and the interest thereon shall never constitute and shall not be considered as general obligations of the District, the City, Jefferson County or the State of Texas. All interested parties are invited to attend the public hearing, or submit written comments prior to the hearing, and express any comments they may have regarding the Project and the issuance of the bonds. City of Port Arthur, Texas P.O. Box 1089 Port Arthur, Texas 77641 Attention: City Attorney MINUTES OF PUBLIC HEARING Re: $150,000,000 Port of Port Arthur Navigation District of Jefferson County, Texas Exempt Facilities Revenue Bonds (TOTAL Petrochemicals USA, Inc. Project), Series 2011A I, the duly appointed hearing officer (the "Hearing Officer ") of the City of Port Arthur, Texas called the Public Hearing to order at 9:00 a.m. on October 6 , 2011, with respect to the referenced bonds (the "Bonds "). The Hearing Officer declared that the Public Hearing, required under Section 147(f) of the Internal Revenue Code of 1986, was open for purposes of discussing the Bonds and the project to be financed with the proceeds of the Bonds, to -wit: the financing of the acquisition, construction, and improvement of sewage and solid waste disposal facilities (the "Project ") related to a refinery expansion, including a new coker (the "Project "), which are located at the TOTAL Petrochemicals USA, Inc.'s plant site complex at 7600 32nd Street in Port Arthur, Texas. The Hearing Officer declared that the required notice of the Public Hearing for the Project was published in the Port Arthur News, being a newspaper of general circulation in the specific location of the Project and in the jurisdiction in which the public hearing was held. Continents and discussions with respect to the Bonds and the Project are summarized in Exhibit A, attached hereto. After sufficient time was given for all present to make their comments with respect to the Bonds and the Project, I declared the Public Hearing closed. CITY OF PORT ARTHUR, TEXAS By: Title: PORT OF PORT ARfHCRITOTAL /2011A: CITY HEARING MINUTES WPD