Texas Border Business
By DAVID A. DÍAZ
City of Edinburg and Hidalgo County leaders are scheduled to meet at noon on Monday, December 12, 2016, at Edinburg City Hall to review and take possible action on plans to build a new county courthouse in the city’s downtown region, the Edinburg Economic Development Corporation has announced.
In a separate, but related issue dealing with construction of another major facility in Edinburg, the City Council also will hold a public hearing regarding program guidelines of the Edinburg Housing Finance Corporation – which is an extension of the City Council – that could lead to the financing of a major upscale residential complex known as La Sienna Apartments.
Both meetings, which will be held in the Council Chambers of Edinburg City Hall, which is located at 415 East University Drive, are open to the public.
The joint session between the Edinburg City Council and the Hidalgo County Commissioners Court, will focus on “Discussion and action on Memorandum of Understanding between County of Hidalgo, City of Edinburg and Edinburg EDC regarding the development of and funding for a New Hidalgo County Courthouse,” according to the agendas posted online by the city and the county.
According to U.S. legal.com, a memorandum of understanding (MOU) may be used as a confirmation of agreed upon terms when an oral agreement has not been reduced to a formal contract. It may also be a contract used to set forth the basic principles and guidelines under which the parties will work together to accomplish their goals.
The deliberations also will include what roles might be played by the Edinburg Economic Development Corporation, which is the jobs-creation arm of the Edinburg Mayor and Edinburg City Council, in the development and funding for the planned county courthouse.
The Edinburg EDC Board of Directors is comprised of Mayor Richard García as President, Harvey Rodríguez, Jr. as Vice President, Elías Longoria, Jr. as Secretary/Treasurer, and Richard Rupert and Dr. Peter Dabrowski as Members.
Agustín García, Jr. is Executive Director for the Edinburg EDC.
EDINBURG HOUSING FINANCE CORPORATION, LA SIENNA APARTMENTS
The public session that will feature only the Edinburg City Council calls for the following actions:
Public Hearing
Hold Public Hearing Regarding Program Guidelines of the Edinburg Housing Finance Corporation Pursant to Section 394.9025(b), Texas Local Government Code.
Resolution
Consider Resolution
Approving and Establishing the City of Edinburg Economic Development Program Policies and Procedures Pursuant to Chapter 380 of the Texas Local Government Code;
• Establishing the EHFC La Sienna Apartments Chapter 380 Economic Development Program;
• Approving the Chapter 380 Economic Development Agreement;
• Approving the Economic Development Support Agreement and Related Loan and Security Documents;
• Approving the Intercreditor Agreement;
• Approving Program Guidelines; Approving Application of the Act to Certain Residential Development, and
• Authorizing the Mayor or the Mayor Pro-Tern to Execute the Approved Agreements and Any Other Instruments Deemed Necessary and Proper to Effectuate the Purpose of this Resolution.
NEW COURTHOUSE WOULD HAVE TO BE BUILT IN DOWNTOWN EDINBURG
The key provision of Edinburg’s involvement in helping finance the project states that the new courthouse would be built on the existing courthouse square in downtown Edinburg, next to the existing Hidalgo County Courthouse.
The financial strategies by the city and county have yet to be finalized, and the construction of the courthouse still must face future actions by the Hidalgo County Commissioners Court.
The Edinburg City Council/Hidalgo County Commissioners Court joint session was originally scheduled for Tuesday, December 6, 2016 in the Hidalgo County Commissioners Courtroom, located on the first floor of the county Administration Building at 100 East Cano.
But county officials wanted additional details regarding the city’s vision for the redevelopment of the downtown region, where the current Hidalgo County Courthouse and the proposed Hidalgo County Courthouse are and would be centered.
City leaders provided the needed information, according to Richard Hinojosa, Edinburg’s City Manager, which led to the upcoming Monday, December 12, 2016 joint work session to be held at noon in the Council Chambers at Edinburg City Hall.
Hinojosa provided the public with additional information regarding the vision of the Edinburg Mayor and Edinburg City Council relating to the downtown region.
Highlights of Hinojosa’s insights follow:
Question:
What can you reveal so far about what the city and the Edinburg Economic Development Corporation have been looking at offering for the planned new county courthouse?
Richard Hinojosa:
Our commitment has always been the same. We were looking at providing $1.5 million (one million, five hundred thousand dollars) a year for 30 years, which would be shared equally between the city and the Edinburg EDC.
Question:
Nothing precludes the city or the Edinburg EDC from paying off the payments to the county ahead of time?
Richard Hinojosa:
Correct. There is a provision in the MOU for that.
The MOU is just the first step. We also will have to enter into an interlocal agreement with the county on the actual construction. They are going to have a committee, and we will have representation on that committee, during the entire construction project.
(Note: An interlocal agreement is generally defined as “a written contract between local government agencies such as a city, a county, a school board or a constitutional office. Any time a public service involves the joint operations and budgets of two or more local government agencies, an interlocal agreement must be drawn up and approved by all sides, with each government’s governing body–a school board, a city council, a county commission–enacting the agreement by vote. Source: https://flaglerlive.com/62163/interlocal-agreement-definition-faq/)
We also are involved with the county on a $20 million grant from the Hidalgo County Metropolitan Planning Organization for roadway infrastructure and drainage around the county courthouse. That all will get spelled out in the interlocal agreement – that will be the next step after the MOU.
(Note: The Hidalgo County Metropolitan Planning Organization (HCMPO) is a federally funded program that works with Hidalgo County communities and the Texas Department of Transportation to plan for the county’s future transportation needs. Under federal law, every metropolitan area with a population of 50,000 must have a designated Metropolitan Planning Organization. Citizens are encouraged to participate in the planning process. Edinburg Councilmember Homer Jasso, Jr. currently serves as Edinburg’s representative on the HCMPO. Source: https://www.hcmpo.org)
Question:
The $20 million funding from the Hidalgo County Metropolitan Planning Organization, is that contingent on a new courthouse being approved for construction?
Richard Hinojosa:
No, it (roadway infrastructure and drainage around the county courthouse) will occur regardless.
Question:
What will be the impact of the $20 million grant from the Hidalgo County Metropolitan Planning Organization?
Richard Hinojosa:
The biggest impact is we will solve the drainage problem downtown.
The main obstacles of flooding have been that the drainage has always gone east. I-69 has always been a bottleneck for trying to get drainage to go east – there is no outfall.
With this new funding and with the roadway improvements that we will be doing there, we will be taking the drainage west, straight to the ditch on the west outfall.
The plan is to fix the downtown drainage once and for all so we don’t have any more flooding there.
Question:
Has a specific plan for the downtown drainage been considered by the City Council?
Richard Hinojosa:
We have done a master plan drainage study, and downtown was part of that master plan, so the City Council is aware of that.
We have been meeting with the county. With a brand new courthouse going up there, we want people to be able to get there. With the location of the new courthouse, we will be closing Closner Blvd. between Cano and McIntyre streets, so we will have a one-way roadway system around the courthouse.
That one-way roadway system will also be incorporated into the $20 million funding from the MPO – it will be part of the $20 million funding – including all the signalization and signage that goes with it, and especially the drainage that goes with it.
Question:
That $20 million funding was approved by the Hidalgo County Metropolitan Planning Organization earlier this fall? Was it Councilmember David Torres who was serving on the MPO at the time?
Richard Hinojosa:
Yes, Councilmember Torres was on the MPO at the time. Hidalgo County Commissioner (Precinct 4) Joseph Palacios was too. We brokered that project with all the other communities that are on the MPO.
Question:
Regarding a related meeting with some city and county officials on the courthouse project that was held yesterday (Monday, December 5, 2016), who participated in that session and why was the decision made to cancel the planned city council/county commissioners court joint session that would have been held at noon today (Tuesday, December 6, 2016).
Richard Hinojosa:
I think that we all want to make sure that when we get to the meeting next week, that we are all on the same page, and that we did not have any issues that might be a point of discussion.
We had one more meeting (with key staff members on Monday, December 5, 2016), and they asked for additional information on what we want to do with our downtown. Obviously, we are looking to redo our downtown and improve upon it. We have a master plan for our downtown, possibly designate it as a TIRZ or other reinvestment zones downtown. We brought all of those up to the county, so we are providing all that information this week.
(Note: Tax Increment Reinvestment Zones (TIRZs) are special zones created by City Council to attract new investment in an area. TIRZs help finance costs of redevelopment and encourage development in areas that would otherwise not attract sufficient market development in a timely manner. Taxes attributable to new improvements (tax increments) are set-aside in a fund to finance public improvements within the boundaries of the zone. TIRZs are special zones created by City Council to attract new investment in an area. TIRZs help finance costs of redevelopment and encourage development in areas that would otherwise not attract sufficient market development in a timely manner. Taxes attributable to new improvements (tax increments) are set-aside in a fund to finance public improvements within the boundaries of the zone. Source: https://www.houstontx.gov/ecodev/tirz.html)
The courthouse is going to be the focal point downtown, but redevelopment around the courthouse is going to be very important. That is something we wanted to make sure that the county was aware.
Question:
Who participated in this meeting yesterday (Monday, December 5, 2016) between the city and the county?
Richard Hinojosa:
Councilmember (Homer) Jasso, Jr. and myself, with County Judge Ramon Garcia and County Commissioner Joseph Palacios and their staffs.
••••••
DRAFT OF THE PROPOSED MEMORANDUM OF UNDERSTANDING AMONG THE COUNTY OF HIDALGO, THE CITY OF EDINBURG And THE EDINBURG ECONOMIC DEVELOPMENT CORPORATION REGARDING THE DEVELOPMENT OF AND FUNDING FOR A NEW HIDALGO COUNTY COURTHOUSE TO BE LOCATED IN EDINBURG, TEXAS
Purpose
The purpose of this Memorandum of Understanding (“MOU”) is to memorialize the commitments made by the County of Hidalgo (the “County”), the City of Edinburg (the “City”) and the Edinburg Economic Development Corporation, a non-profit corporation created by the City and organized pursuant to Section 4A of the Development Corporation Act of 1979, – Article 5190.6, V.A.T.C.S. (the “EEDC”), in furtherance of the construction of a new Hidalgo County Courthouse (the “Courthouse”), to be located in the county seat of Edinburg, Texas.
Background
Originally constructed in 1954, the existing courthouse accommodated five courts that served a small rural community with a population of 168,000. Today, the County has 24 courts with a population nearing 900,000. The increase in the number of courtrooms requires County and City leaders to address the need for a new courthouse (the “Courthouse”) that can accommodate all of the current County courts, while considering our continuing growth and the changing landscape that has become known as downtown Edinburg. In addition to serving the judicial needs of the County, a new Courthouse in downtown Edinburg is expected to revitalize the area, compliment the growth of the University of Texas RGV, and spur economic development in our vibrant community.
Commitment of the County of Hidalgo
• The County is committed to constructing and operating a new Courthouse. The County currently expects that the Courthouse will:
• Be built on the existing courthouse square in downtown Edinburg; Serve the existing courts in Hidalgo County, and allow for consideration for future courts;
• Serve the County Clerk and District Clerk, as well as other offices deemed necessary to support court operations or otherwise deemed appropriate by the County;
• Improve safety and health conditions for all visitors, employees, and those who conduct business at the Courthouse;
• Accommodate parking for employees and others with business at the Courthouse; Increase opportunities for economic development; and
• Benefit the citizens of the City and the County.
Commitment of the City of Edinburg
To support and ensure the success of the County in its endeavor to create and operate the new Courthouse in downtown Edinburg, the City desires to cooperate by contributing to the County an amount equal to the lesser of (i) twenty percent (20%) of the Total Project Cost (as such term is defined below) and (ii) Thirty Million Dollars (U.S.$30,000,000.00) (such amount, the “City Contribution Commitment”). The following terms apply to the City Contribution Commitment:
The “Total Project Cost” includes, without limitation, the architectural, engineering, design, government approvals, geotechnical, lab testing, surveying, construction, construction/program management, FF&E, accounting and similar development costs to have the Courthouse designed, constructed and furnished, whether incurred prior to or after execution hereof. The current estimate of the Total Project Cost is One Hundred Fifty Million Dollars (U.S.$150,000,000.00).
If, in order to pay the City Contribution Commitment in full, the City incurs debt obligations for the purpose of financing the City Contribution Commitment, then the payment of the City Contribution Commitment to the County will be due and shall be paid by the City on or before the later of: commencement of construction on the Courthouse, and ii. the earlier of: (A) one year from the date the City incurs such debt obligations and (B) thirty (30) days prior to the date on which the County’s first payment on any bonds issued by the County or other financing, if any, incurred by the County for the Courthouse (the “County Financing”).
c. If the City opts to pay the City Contribution Commitment over time instead of paying the entire amount upfront, then the City will make thirty (30) annual payments of One Million Five Hundred Thousand Dollars (U.S.$1,500,000.00) to the County with the first such payment being made on or before the later of: i. thirty (30) days prior to the County’s first payment on the County Financing, which date shall be provided in writing by the County to the City at least thirty (30) days before the due date of the City’s payment; and ii. commencement of construction; and each subsequent payment shall be due, and shall be paid no later than, the same date of the year during each of the subsequent twenty-nine (29) years.
d. In the event the City intends to incur debt obligations in accordance with Subparagraph 4.b. above but has not incurred such debt by the earlier of (i) December 31, 2017 and (ii) the closing on the County Financing, then the City shall make annual payments in accordance with Subparagraph 4.c. above until such time as the City pays off the remaining balance of the City Contribution Commitment pursuant to Subparagraph 4.b. above.
e. Nothing in Subparagraphs 4.b. through 4.d. above shall be construed to prevent the City from making payments on the City Contribution Commitment prior to the due date for such payment.
f. If the City creates a Tax Increment Reinvestment Zone (“TIRZ”) including any of the Edinburg downtown area, then the City shall cause the TIRZ to dedicate the tax increment revenue to fulfill the City’s Contribution Commitment before using any such TIRZ funds for other purposes. Without limiting the generality of the foregoing, if the County participates in such TIRZ, no County funds shall be used for the City
g. The City’s agree to make the City Contribution Commitment pursuant to this Paragraph 4 is subject to annual appropriation from the City Council of the City except to the extent (i) the City opts to fund the City Contribution Commitment through bonds pursuant to Subparagraph 4.b. above or through a TIRZ pursuant to Subparagraph 4.f. above or (ii) of the EEDC’s payments pursuant to Paragraph 5 below). The City agrees, however, to use its best efforts to secure the funds necessary for making the City Contribution Commitment in accordance with the terms hereof.
h. The Courthouse development will require off-site infrastructure design, approval and construction for improvements including, without limitation, drainage systems, utilities, roadways and traffic controls (“Off-Site Infrastructure”). The County and City agree that payments by the City or any third party, including the Hidalgo County Metropolitan Planning Organization for Off-Site Infrastructure shall not count towards the City Contribution Commitment.
i. The City may provide input to the County with respect to the County’s ongoing planning, design, and site-work considerations for the Courthouse. If the County creates a committee for such planning design and site-work considerations for the Courthouse, the County agrees to allow the City to appoint one member of the committee.
Commitment of the EEDC
To support and ensure the success of the County in its endeavor to create and operate the Courthouse in downtown Edinburg, the EEDC desires to cooperate by providing a minimum of Seven Hundred Fifty Thousand Dollars (U.S.$750,000.00) per year to the County. Any such funds received by the County from the EEDC shall be allocated toward the City Contribution Commitment pursuant to Paragraph 4 above.
Future Development and Actions
a. The parties acknowledge that additional terms are to be determined among them, and will be subject to one or more additional agreements between them, which may include (i) an agreement pursuant to the Interlocal Cooperation Act, Texas Government Code 791.001 et seq., which authorizes local governments to contract with each other to perform governmental functions and services under the terms of the Act; and/or (ii) in recognition of the increased opportunities for economic development, an economic development agreement pursuant to Chapters 380, Local Government Code.
b. Notwithstanding anything to the contrary contained herein, the parties agree that (i) the Courthouse is the County’s project, (ii) the parties hereto other than the County shall have no ownership, control or management with respect to the Courthouse, and (iii) the County shall retain control of it, including without limitation with respect to planning, design, site-work, scheduling, and procurement of goods and services.
••••••
DANNENBAUM ENGINEERING CORPORATION RANKED HIGHEST TO DESIGN AND CONSTRUCTION NEW HIDALGO COUNTY COURTHOUSE
On Friday, October 21, 2016, a week after hearing from five companies vying for the project management contract, the Hidalgo County Commissioners Court, meeting in a special session, presented their scoring sheets to the Purchasing Department to select for negotiations a firm for the design and construction of the new Hidalgo County Courthouse.
After the tally, Dannenbaum Engineering Corporation was ranked highest among the firms and the county commissioners court voted to commence negotiations to finalize a professional service agreement.
Below is the ranking and average score for the five firms:
1. Dannebaum, 95.4
2. Jacobs Project Management Co., 92.8
3. Broaddus & Project Control,92.4
4.Hill International, 92.0
5. JLL 86.8
Hidalgo County Purchasing Agent Martha Salazar pointed out that if the negotiations fail with Dannebaum, the county will proceed to negotiate with the second-ranked firm, Jacobs Project Management Co.
During the presentation of qualifications at the Thursday, October 13, 2o16 county commissioners court, Louis Jones, who serves as Principal/Director, South Texas Region, for Dannenbaum, said his firm will partner with B2Z Engineering of Mission, Moca of San Antonio, Farmsworth Group, of San Antonio, and Naylor Wentworth Lund Architects, of Salt Lake City, Utah.
“The Hidalgo County Courthouse Team is a uniquely qualified group of design, program and construction management and inspection professionals with the necessary expertise required for this pursuit,” Jones said during the presentation.
