The Bastrop Mayor and Board of Aldermen met at City Hall in their regular monthly meeting Thursday evening. Among the items discussed was the possible bankruptcy of Flying Tigers Aviation and the City's responsibility for a grant repayment if Flying Tigers fails to repay the grant monies.
An agenda item that would give Mayor Henry Cotton approval to institute litigation, negotiation, or to file a bankruptcy credit claim in the case of the Flying Tigers Aviation school that abruptly closed down in June was approved by the Board. The City of Bastrop is owed approximately $190,000 for fuel that Flying Tigers used but never paid for. The City was also a sponsor of $575,000 grant that Flying Tigers was awarded, but was responsible for repaying if conditions were not met. That grant would, according to Mayor Henry Cotton, become a loan upon default, which has occurred. The loan with a 12% annual percentage rate of interest, has approximately $410,000 remaining of the principal balance to be repaid.
"We are on the hook for over $600,000 due to the failure of Flying Tigers," Cotton said. "We (the City) just failed to do what was necessary to reign them in." Cotton was not Mayor when the grant and other debt of Flying Tigers were incurred.
Cotton did allude to some good news in the Flying Tigers affair. A new hangar was constructed at the Bastrop Airport as part of the grant, and that hangar will now become the City's. He has already talked to people that are interested in the hangar and use the airport, possibly for flight training.
Another somewhat contentious agenda item was Peoples Water Company's request for a 25-year extension of their water franchise in the City. While People's submitted the draft resolution for approval with a 25-year extension, Cotton had that changed to 3 years.
"I thought it necessary, before granting a 25-year franchise, that we owed it to the residents of the City to examine the water company," Cotton said.
"Three years does not allow us to do any planning on replacing equipment etc," Doil Nelson of Peoples Water Service said.
Cotton has formed a Utility Commission and charged them with looking into utilities in the City.
"We need time for the commission to do its work," Cotton said. The Utility Commission formed by Cotton has not as of yet held a meeting. Although each councilman and Cotton have submitted names for those to serve on the commission.
Cotton said that he has looked at census figures and feels that the City may well be down to under 10,000 residents by 2020. A number that could affect grants, loans and other financial issues for the City.
"Right now it is a critical time with everything in flux," Cotton said. "I feel deeply that a rubber stamp is not appropriate."
"You are handcuffing me," Nelson said about the three year proposed franchise. "I don't like being picked on as a water company. The gas company doesn't get this."
Toward the end of the discussion Cotton did state that he would not be opposed to a 15-year franchise agreement once the Utility Commission has completed it's "vetting process".
The council ultimately decided to table the resolution granting a franchise. People's current franchise does not run out until 2018.
In other water and sewer related discussion the Council heard from Dennis Lyon about a water/sewer "service line" insurance program that his company, Utility Service Partners, would like to begin offering in Bastrop. The basic program would cover, "Homeowner repair protection for leaking, clogged or broken water and sewer lines from the point of utility connection to the home exterior." An additional coverage would also be offered that covers a homes interior water supply and in-home sewer lines, as well as all drain lines connected to the main sewer stack. The coverage would offer repairs and would even include "coverage for broken or leaking water, sewer, or drain lines under the slab or basement floor."
The city would have an opportunity to receive a royalty from each person utilizing the coverage based on the number of insureds using the coverage. USP would handle all billing and repairs and was asking the City to allow them to use the City's logo and approval in marketing materials that would be sent out.
The coverage would be voluntary for any homeowner and no public funds are used in marketing, distribution, or administration of the program. USP would only market by direct mail, with no telemarketing and would never mail without the City's review and approval of marketing material before each and every campaign. Lyon said there would be a maximum of 3 mailing campaigns per year.
Lyon said that USP is currently offering the service in 475 municipalities, including Arcadia in Louisiana. They currently service over 3.1 million homeowners throughout the United States. The program is endorsed by the National League of Cities, No action was taken on the proposal at the Thursday meeting.
In other business, the City approved an extension on the ad valorem tax exemption granted to 715 S. Washington, LLC, which is the old high school on South Washington that was renovated and turned into apartments for the elderly. The tax exemption is granted for the restoration of historic structures such as the old school.
In a somewhat ironic twist from the drawn-out discussion of People's Water Service franchise agreement, the City donated a water main located in the industrial park to People's Water Service. The donation was needed for People's to provide water to the main which will be used by the City at its new fire training facility in the Industrial Park. Research by City staffers showed that the water main, which was built with a grant, should have been donated to Peoples when it was built, however through an oversight it was not. People's cannot provide water service through a main that it does not own.
The Council also agreed to contract with NEOGOV, which operates governmentaljobs.com, to begin taking Fire and Police applications through the online service. The Council also agreed to advertise for bids to construct a handicap accessible entrance at the South end of City Hall. City Clerk Sandra Goleman explained that the USDA is requiring the City to make the entrance accessible before it will release any more grant funds to the City.