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HomeMy WebLinkAboutPR 16862: PORT OF PORT ARTHUR PUBLIC HEARING CITY interoffice 20i2 FEB , 1 x:39 MEMORANDUM IA To: Mayor, City Council, and Acting City Manager r From: Valecia R. Tizeno, City Attorney Date: February 1, 2012 Subject: P. R. No. 16862; Council Meeting February 7, 2012 Attached is P. R. No. 16862 authorizing the Mayor and or any Assistant City Manager to attend and conduct a public hearing at the offices of the Port of Port Arthur, 221 Houston Avenue, Port Arthur, on February 17, 2012, at 9:00 a.m. regarding the issuance and approval of Port Arthur Navigation District Industrial Development Corporation exempt facilities revenue bonds (TOTAL Petrochemicals & Refining USA, Inc. Project) Series 2011 in the aggregate principal amount of $150,000,000, as per 26 USCS Section 147. VRT:gt Attachment cc: Assistant City Manager /Administration • s.pr16862_memo P. R. No. 16862 01/25/12 RESOLUTION NO. A RESOLUTION AUTHORIZING THE MAYOR AND OR ANY ASSISTANT CITY MANAGER TO ATTEND AND CONDUCT A PUBLIC HEARING AT THE OFFICES OF THE PORT OF PORT ARTHUR, 221 HOUSTON AVENUE, PORT ARTHUR, ON FEBRUARY 17, 2012 AT 9:00 A.M. REGARDING THE ISSUANCE AND APPROVAL OF PORT ARTHUR NAVIGATION DISTRICT INDUSTRIAL DEVELOPMENT CORPORATION EXEMPT FACILITIES REVENUE BONDS (TOTAL PETROCHEMICALS & REFINING USA, INC. PROJECT) SERIES 2011 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 and/or any Assistant City Manager to attend and conduct a public hearing at 9:00 a.m. on February 17, 2012, regarding the issuance and approval of Port Arthur Navigation District Industrial Development Corporation Exempt Facilities Revenue Bonds (Total Petrochemicals & Refining USA, Inc. Project) Series 2012 in the aggregate principal amount not to exceed $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 and/or any Assistant City Manager to attend and conduct a public hearing at 9:00 a.m. on February 17, 2012, at the offices of the Port of Port Arthur, regarding the issuance and approval of Port Arthur Navigation District Industrial Development Corporation Exempt Facilities Revenue Bonds (Total Petrochemicals & Refining USA, Inc. Project) Series 2012 in the aggregate principal amount not s.pr16862 to exceed $150,000,000, as per 26 USCS Section 147. 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 & Refining 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 _ day of February, 2012, 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 TQ . ORM: VALECIA R. ' Ajw.- E 0, Yr TORNEY APPROVED FOR ADMINISTRATION: JOHN A. COMEAUX, P. E., ACTING CITY MANAGER 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 City Attorney City of Port Arthur, Texas Cc: Scot Sheldon Sheldon Law Firm, PLLC. From: Gregory B. Salinas McCall, Parkhurst & Horton L.L.P. Date: January 25, 2012 Re: $150,000,000 Port Arthur Navigation District Industrial Development Corporation Exempt Facilities Revenue Bonds (Total Petrochemicals & Refining USA, Inc. Project), Series 2012 (the "Bonds ") The following memorandum describes the federal tax law provisions requiring the City of Port Arthur, Texas (the "City ") to hold a public hearing 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 the necessary public hearing. 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 2010) relating to the issuance of bonds by the Port of Port Arthur Navigation District of Jefferson County, Texas (the "Port") and the Port's Port Arthur Navigation District Industrial Development Corporation (the "Issuer ") for the benefit of Total Petrochemicals & Refining USA, Inc. (the "Company ") (recently changing their name from TOTAL Petrochemicals USA, Inc. and formerly known as ATOFINA Petrochemicals, Inc. and Fina Oil and Chemical Company) and/or BASF Corporation. The Bonds being issued by the Issuer, substantially identical to the June 2011 financing, to continue the financing of the on- going, major plant expansion of the Company as Hurricane Ike disaster area bonds under the federal Heartland Disaster Tax Relief Act of 2008. 1 The Issuer and the Port will approve and authorize the Bonds pursuant to action to be taken by the Issuer and the Port on February 8, 2012. The Bonds will be issued to finance the costs of major improvements to the Company's existing plant complex, located at 7600 32 " Street, adjacent to the boundary of the Port, but within the extra - territorial jurisdiction of the City. Also on February 8, 2012 and prior to the issuance and deliver of the Bonds, the Issuer will hold a public hearing regarding the 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, now 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 Issuer and 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 and the Issuer, 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 June 16, 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 January 31, 2012 or the February 7, 2012 City Council agenda. Attached is a draft resolution of the City Council consistent with prior related resolutions of the City. Due to the Acting City Manager of the City also being a board member of the Issuer and the Port, the draft resolution has changed references to "City Manager" to "any Assistant City Manager." However, I defer to you for any revisions, changes, etc. that you deem appropriate. Similar to 2011, because of the time frame in which to get the required notice published, it necessary that a time and date for the public hearings be determined prior to the January 31 or February 7 City Council meeting which the public hearing will be authorized in order to meet the publication requirements and the scheduled February 28, 2012 closing on the Bonds. If such a time and date can be determined by early Friday, January 27, 2012 for a hearing any time between February 13 through February 16 (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. We would suggest a hearing at 9:00 a.m. CST on Monday, February 13, 2012. 2 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 and March and December 2010 and May 2011 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 , 2012, 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, and any Assistant City Manager (presumably excluding John Comeaux as Acting City Manager) and authorizing the Mayor's approval of the subject bonds for purposes of Section 147(0. 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 Arthur Navigation District Industrial Development Corporation for the benefit of Total Petrochemicals & Refining USA, Inc., appointing hearing officers therefor and authorizing the Mayor to approve such bonds for certain federal tax purposes only." Scot Sheldon of Sheldon Law Firm, 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 either the January 31S' or February 7th, 2012 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 P. R. No. / /12 RESOLUTION NO. A RESOLUTION AUTHORIZING THE MAYOR AND OR ANY ASSISTANT CITY MANAGER TO ATTEND AND CONDUCT A PUBLIC HEARING AT THE OFFICES OF THE PORT OF PORT ARTHUR, 221 HOUSTON AVENUE, PORT ARTHUR, ON FEBRUARY _ , 2012 AT _.M. REGARDING THE ISSUANCE AND APPROVAL OF PORT ARTHUR NAVIGATION DISTRICT INDUSTRIAL DEVELOPMENT CORPORATION EXEMPT FACILITIES REVENUE BONDS (TOTAL PETROCHEMICALS & REFINING USA, INC. PROJECT) SERIES 2011 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 and/or any Assistant City Manager to attend and conduct a public hearing at a.m. on February _, 2012, regarding the issuance and approval of Port Arthur Navigation District Industrial Development Corporation Exempt Facilities Revenue Bonds (Total Petrochemicals & Refming USA, Inc. Project) Series 2012 in the aggregate principal amount not to exceed $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 and/or any Assistant City Manager to attend and conduct a public hearing at a.m. on February _, 2012, at the offices of the Port of Port Arthur, regarding the issuance and approval of Port Arthur Navigation District Industrial Development Corporation Exempt Facilities Revenue Bonds (Total Petrochemicals & Refming USA, Inc. Project) Series 2012 in the aggregate principal amount not to exceed $150,000,000, as per 26 USCS Section 147. 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 & Refining 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 _ day of February _ , 2012, 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 TO FORM: VALENCIA "VAL" TIZENO, CITY ATTORNEY APPROVED FOR ADMINISTRATION: CITY MANAGER EXHIBIT "A" PUBLIC HEARING NOTICE The City of Port Arthur, Texas (the "City") will hold a public hearing at a.m. on February _ , 2012, 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 Port Arthur Navigation District Industrial Development Corporation (the "Issuer "), pursuant to a plan of finance, of one or more series of bonds (the "Bonds "), the proceeds of which will be loaned to Total Petrochemicals & Refining USA, Inc. (the "Company ") for the purpose of paying the costs of the acquisition, construction, reconstruction, and renovation of certain nonresidential real property (including fixed improvements associated with such property) (the "Project) to be used by the Company in the manufacture, transportation, and/or sale of crude oil, petroleum products and petrochemicals. The Project will be located at the Company's plant site complex at 7600 32nd Street in Port Arthur, Jefferson County, Texas, outside the boundaries of the Issuer. The maximum aggregate face amount of the Bonds is anticipated to be $150,000,000. All interested parties are invited to submit written comments to the City prior to the time set for the public hearing or to attend the public hearing and express any comments they may have regarding the Project or 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 Arthur Navigation District Industrial Development Corporation Exempt Facilities Revenue Bonds (Total Petrochemicals & Refining USA, Inc. Project), Series 2012 I, the duly appointed hearing officer (the "Hearing Officer ") of the City of Port Arthur, Texas called the Public Hearing to order at _ a.m. CST on , 2012, with respect to the referenced bonds (the "Bonds"). The Hearing Officer declared that the Public Hearing, required under Section 147(1) 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 certain facilities, including an undertaking the costs of which are eligible to be paid from the proceeds of Hurricane Ike disaster area bonds under Section 704, Heartland Disaster Tax Relief Act of 2008 (Pub. L. No. 110 -343), at the Port Arthur, Texas plant of Total Petrochemicals & Refining USA, Inc. (the "Project ") 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. Comments 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 ARTHURNDIDGTOTAU2012: CITY HEARING MINUTES.WPD EXHIBIT A No comments were made by the general public at the hearing with respect to this Project. PORT ARTHURNDIDC/TOTAW2012: CITY HEARING MINUTES.WPD MAYOR'S CERTIFICATE Port Arthur Navigation District Industrial Development Corporation 221 Houston Avenue Port Arthur, Texas 77640 RE: Port Arthur Navigation District Industrial Development Corporation Exempt Facilities Revenue Bonds (Total Petrochemicals & Refining USA, Inc. Project) Series 2012 in the aggregate principal amount of $150,000,000 Ladies and Gentlemen: Pursuant to Section 147(0 of the United States Internal Revenue Code of 1986, as amended (the "Code "), I hereby certify that I have been duly elected as Mayor of the City of Port Arthur, Texas (the "City") and as such constitute the chief elected executive officer of the City. I have been informed by you that the Port Arthur Navigation District Industrial Development Corporation has adopted a Resolution authorizing the issuance of the captioned bonds (the "Bonds ") under the provisions of Texas law for the purpose of the financing of the acquisition, construction, and improvement of certain facilities, including an undertaking the costs of which are eligible to be paid from the proceeds of Hurricane Ike disaster area bonds under Section 704, Heartland Disaster Tax Relief Act of 2008 (Pub. L. No. 110 -343), at the Port Arthur, Texas plant of Total Petrochemicals & Refining USA, Inc. I have been informed that a public hearing regarding the issuance of the Bonds was held by the Issuer on February _ , 2012 at 9: a.m. CST. I hereby approve the issuance of the Bonds for the purpose of Section 147(0 of the Code. Such approval is solely for purposes of such Section 147(0 and the City shall have no liability for payment of the Bonds or otherwise nor shall any of its assets be pledged to the payment of the Bonds. Very truly yours, Mayor DATE: February , 2012